/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100326.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, March 26, 2010, Vol. 14, No. 84 Headlines 360NETWORKS INC: Creditors Lose Bid to Get Dreier Artworks ACCESS PHARMACEUTICALS: Whitley Penn Raises Going Concern Doubt ALERIS INT'L: $690 Million Rights Offering Gets Go Signal ALERIS INT'L: Hilco Completes Sale of Aluminum Foil Plant ALERIS INT'L: Modified Plan Offers 50% to Unsecureds ALION SCIENCE: Inks Pact with Credit Suisse on Sale of 12% Notes ALL LAND INVESTMENTS: Plan Confirmation Hearing Set for April 27 AMBAC FINANCIAL: Regulator Assumes Control of Troubled Contracts AMBAC FINANCIAL: May Seek Bankruptcy Protection AMBAC FINANCIAL: Clients May Receive 25% in Cash AMERICA'S SUPPLIERS: MalongBailey LLP Raises Going Concern Doubt AMERICAN LOCKER: Santa Monica Partners Holds 8.3% of Common Stock AMR CORP: Sees $4.9 Billion Cash Balance at End of Q1 ARIZONA EQUIPMENT: Installment-Payment Plan Confirmed by Court ANTHRACITE CAPITAL: Al Togut Serves as Chapter 7 Trustee BASS PRO: S&P Assigns Corporate Credit Rating at 'BB-' BEAR MOUNTAIN: Gets Creditor Protection Under CCAA BERNARD MADOFF: Owes $984,280 in Sales Tax to New York State BIV RETAIL: Foreclosure Sale to Close by Month's End BOSQUE POWER: Files for Chapter 11 Bankruptcy in Texas BRIDGEVIEW AEROSOL: Exclusivity Period Extended Until April 30 BRIDGEVIEW AEROSOL: Cash Collateral Hearing Set for April 1 BUFFETS HOLDINGS: Seeking Replacement $250-Mil. Term Loan BWAY CORP: S&P Changes Outlook to Positive; Affirms 'B+' Rating C BEAN: Section 341(a) Meeting Scheduled for May 6 C BEAN: Asks for Court's Nod to Use Cash Collateral C BEAN: Taps Doerner Saunders as Bankruptcy Counsel C BEAN: Wants to Hire Smith Cohen as Co-Counsel C BEAN: Wants May 15 Extension of Schedules Filing Deadline CALIFORNIA: Increases Size of Taxable Bond Sale to $3.4 Billion CAROLINA FIRST: S&P Affirms 'B+/B' Counterparty Credit Ratings CITIGROUP INC: Treasury Mulls Sale of 27% Stake COACHMEN INDUSTRIES: Annual Shareholders' Meeting on April 29 CONSOL ENERGY: S&P Downgrades Corporate Credit Rating to 'BB' CRESCENT RESOURCES: Sending Plan to Creditors for Voting COOPER-STANDARD: Disclosure Statement Hearing to Resume Today COOPER-STANDARD: Duff & Phelps Approved for Asset Valuation COOPER-STANDARD: Plan Exclusivity Extended Until June 29 COOPER-STANDARD: Reaches $17.6MM Settlement With Cooper Tire CRYOPORT INC: Enable Capital Holds 9.9% of Common Stock CVR ENERGY: May Eventually Take Business Public, Moody's Says DELPHI CORP: Automotive Posts $3 Million Loss for 2009 DELPHI CORP: CFO Sheehan to Resign Effective March 30 DELPHI CORP: DSRA Stopped From Pursuing Suit vs. GM DELPHI CORP: Professionals Seek $371 Million in Final Fees DELTA AIR: FS Technicians Reject Union Representation DELTA AIR: Inks LaGuardia & Reagan Pact With US Airways DELTA AIR: Reports February 2010 Traffic Results DELTA AIR: Techops to Expand Services for Sun Country DESERT CAPITAL: Hancock Askew Raises Going Concern Doubt DREIER LLP: 360networks Creditors Lose Bid to Get Artworks DRESSER-RAND GROUP: Moody's Gives Pos. Outlook; Keeps 'Ba3' Rating DUBAI WORLD: To Get $9.5-Bil. Bailout From Dubai Government DUBAI WORLD: Met with Creditors on $26-Bil. Debt Plan ENNIS HOMES: Wants Access to Creditors Cash for April Expenses EXTENDED STAY: To Seek Nod of Starwood Investment Pact on April 8 FANNIE MAE: Sec. Geithner Rules Out Nationalization FREDDIE MAC: Sec. Geithner Rules Out Nationalization FILI ENTERPRISES: Can Use BofA Cash Collateral Through April 11 FINLAY ENTERPRISES: Coles Resigns as Chief Restructuring Officer FRONTIER COMMUNICATIONS: Fitch Retains Positive Watch on Ratings GENERAL MOTORS: To Make $1-Bil. Loan Repayment on Wednesday GENERAL GROWTH: Beachwood Place, 4 Others Win Plan Confirmation GENERAL GROWTH: Finalizes Deals; Reorganization Plan Expected GENERAL GROWTH: Miller Buckfire May Deliver Fairness Opinion GENERAL GROWTH: Simon to Sweeten Offer, Lines Up Financing GMAC INC: Sells Factoring Business to Wells Fargo GREAT ATLANTIC: Senior VP Jennifer MacLeod to Leave Company HAYES LEMMERZ: Howell Can Sell Michigan Facility to Lucy Road HEALTHSOUTH CORP: Shares Initial Observation for 1st Qtr 2010 HOLLYWOOD MOTION: Files Bankruptcy Exit Plan HOVNANIAN ENTERPRISES: Stockholders Okay Amended Incentive Plan INTERSTATE HOTELS: S&P Withdraws 'CCC+' Corporate Credit Rating INSIGHT HEALTH: S&P Downgrades Rating on $315 Mil. Notes to 'CC' JAPAN AIRLINES: Establishes Compliance Investigation Panel JAPAN AIRLINES: Releases January Traffic Data JAPAN AIRLINES: TWU Calls for Antitrust Immunity for AMR Deal JOURNAL REGISTER: Shareholder Lacks Standing to Appeal Plan KEYSTONE AUTOMOTIVE: S&P Puts B- Corp. Credit Rating on Watch Neg. KT TERRAZA: Section 341(a) Meeting Scheduled for April 22 LAKE AT LAS VEGAS: Unsecureds to Receive 4.5% Under Plan LANDMARK VALLEY: Can Borrow $60,000 for House Construction LEHMAN BROTHERS: Examiner to Unveil Players in Lehman Auction LEHMAN BROTHERS: Settles Tax Disputes With IRS For $125M LENOX CONDOMINIUM: Section 341(a) Meeting Scheduled for April 21 LINN ENERGY: S&P Affirms Corporate Credit Rating at 'B+' LIONS GATE: S&P Puts 'B-' Corp. Rating on CreditWatch Negative LOCAL TV: S&P Retains 'B-' Rating on First-Lien Credit Facilities LUXURY VENTURES: Payment to Landlord Wasn't Preferential LYONDELL CHEMICAL: Parent Prices $2.275-Bil. Sr. Secured Notes MAGUIRE PROPERTIES: Posts $335.9-Mil. Net Loss for Dec. 31 Qtr. MAMMOTH CORONA: Amended Plan Outline Hearing Set for April 21 MAMMOTH CORONA: Cash Collateral Hearing Slated for April 21 MAXIM CRANE: Moody's Assigns Corporate Family Rating at 'B3' MAXIM CRANE: S&P Assigns Corporate Credit Rating at 'B' MAXKO PETROLEUM: Trustee Wins $1.1 Mil. from Defaulting Bidders MDRNA INC: KPMG Raises Going Concern Doubt MERVYN'S LLC: Target Losses Bid to Dismiss Creditors' Lawsuit METALS USA: Plans to Raise $200,000,000 in IPO METRO-GOLDWYN-MAYER: Lions Gate Drops Out of Bidding METRO-GOLDWYN-MAYER: Creditors Say Current Offers Too Low MIDWAY GAMES: Receives Approval of Disclosure Statement MOVIE GALLERY: To Pay $7.8-Mil. of Hollywood Studios' Claims MPC COMPUTERS: Gateway Loses Bid to Force Chapter 7 Conversion MSGI SECURITY: Enable Capital Holds 9.99% of Common Stock MSGI SECURITY: Gruber & McBaine Holds 2.9% of Common Stock MXENERGY HOLDINGS: Sempra Sole Holder of Class B Stock NATIONAL CONSUMER: Thrift Supervision Deal Doesn't Move Ratings NEW COMMUNICATIONS: Moody's Puts 'Ba2' Rating on $3.2 Bil. Notes NEW YORK RACING: Racing Industry Rallies for New Casino Operator NORTEL NETWORKS: $7 Mil. in Claims Change Hands March 2-11 NORTEL NETWORKS: Proposes More Work for Global IP NORTEL NETWORKS: Wins OK for LinkLaters as U.K. Counsel NUTRACEA INC: Creditors Object to More Plan Time ONASNI PROPERTY: Relief from Stay Hearing Set for March 31 OVERSEAS SHIPHOLDING: S&P Assigns 'BB-' Rating on $300 Mil. Notes PHARMANET DEVELOPMENT: Moody's Assigns 'B3' Rating on Senior Notes PACIFIC ETHANOL: Calif. SC Approves Settlement With Socius CG PHARMANET DEVELOPMENT: S&P Assigns 'B+' Corporate Credit Rating PHILADELPHIA NEWSPAPERS: Seeks to Force Lenders to Extend DIP Loan PLAINS EXPLORATION: Moody's Assigns 'B1' Rating on $300 Mil. Notes PLAINS EXPLORATION: S&P Assigns 'BB-' Rating on $300 Mil. Notes PREMIER GENERAL: Section 341(a) Meeting Scheduled for April 12 PROTOSTAR LTD: Creditors Appeal $5M Satellite Sale Bonuses REGENT BROADCASTING: Files Schedules of Assets and Liabilities REGENT COMMUNICATIONS: Has Access Lenders' Cash Until July 28 REGENT COMMUNICATIONS: Resilient Wants New Plan of Reorganization RESERVE GOLF CLUB: Court Approves Plan of Reorganization RITZ CAMERA: Closes Shop at Boscov Ahead of Schedule RIVER WEST: to Reduce 45% of Administrative Overhead and Payroll ROTHSTEIN ROSENFELDT: Levinson Jewelers Denies Knowledge of Fraud RUMJUNGLE - LAS VEGAS: Sec. 341(a) Meeting Scheduled for April 22 RUMJUNGLE - LAS VEGAS: Files Schedules of Assets & Liabilities RUMJUNGLE - LAS VEGAS: Taps Nancy Allf as Bankruptcy Counsel RUMJUNGLE - LAS VEGAS: Wants Weinberg as Litigation Counsel SANTA ANA: Fitch Affirms Low-B Ratings, Outlook Stable SCHUCK-BAYMEADOWS: Taps GrayRobinson as Bankruptcy Counsel SCHUCK-BAYMEADOWS: Section 341(a) Meeting Scheduled for April 14 SMURFIT-STONE: Aurelius Insists on Finance II Liquidation SMURFIT-STONE: Aurelius Wants $200MM Claim Allowed for Voting SMURFIT-STONE: Shareholders Want Recovery; IRS Wants Interest SMURFIT-STONE: Wins Nod to Pay Arrangers of $650 Mil. Revolver SOLUTIA INC: S&P Downgrades Rating on $1.15 Mil. Loan to 'BB-' SPECIALTY PACKAGING: Can Hire Klehr Harrison as Co-Counsel SPECIALTY PACKAGING: Can Hire Michael Musso as CRO SPECIALTY PACKAGING: Gets Final Nod to Obtain DIP Financing SPRINT NEXTEL: Panel Sets 2010 Objectives as Free Cash Flow SQUARETWO FINANCIAL: Moody's Assigns 'B2' Corporate Family Rating SQUARETWO FINANCIAL: S&P Assigns 'B' Counterparty Credit Rating STARPOINTE ADERRA: Can Sell Condominium Unit 2083 for $288,000 STRATUS TECHNOLOGIES: Moody's Assigns 'B3' Corporate Family Rating TITLEMAX HOLDINGS: Full-Payment Plan Set for April 12 Hearing TLC VISION: Wins Approval of Disclosure Statement TOPSPIN MEDICAL: Kost Forer Raises Going Concern Doubt TRUMP ENTERTAINMENT: Court to Decide on Exit Plan by Mid-April TRUVO SUBSIDIARY: Gets Consent to Commence Debt Restructuring UAL CORP: Invests on 50 Widebody Aircraft to Reduce Costs UAL CORP: Reports February 2010 Traffic Results US FIDELIS: Sec. 341 Meeting Scheduled for April 5 US FIDELIS: U.S. Trustee Names 4-Member Creditors' Panel VAUGHAN COMPANY: Founder Faces SEC Fraud Charges VERIZON COMMS: S&P Puts Rating on New Comms. Sr. Unsec. Notes VISTEON CORP: Equity Holders Claim Plan Ignores True Value WOLVERINE TUBE: Amendment to Indenture With BNA is Effective W.R. GRACE: BNSF Appeal on Royal Settlement Stayed W.R. GRACE: Court Approves Fees for July-September W.R. GRACE: Settles Asbestos Property Damage Claims XERIUM TECHNOLOGIES: Reports $96.8-Mil. 4th Quarter Net Loss XERIUM TECHNOLOGIES: To Decide on Restructuring Path by March 31 * Moody's: PE-Backed Firms Have High Defaults, Potential Recovery * Greenberg Traurig's UK Unit Expands Restructuring Practice * Kirkland's Labovitz Earns Spot on Law360's Lawyers to Watch * BOOK REVIEW: Ten Cents on the Dollar, Or the Bankruptcy Game ********* 360NETWORKS INC: Creditors Lose Bid to Get Dreier Artworks ---------------------------------------------------------- Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York denied a bid by the official committee of unsecured creditors of 360networks (USA) Inc. to obtain possession of artworks bought by Marc Dreier. The 360networks Committee has alleged that it retained Dreier LLP, to pursue preference actions for the benefit of the 360 Estates. The Committee said that between October 2007 and November 2008, Mr. Dreier stole and converted more than $50 million of preference recovery funds that were held in trust for the Committee, at which time a constructive trust over the funds was established for the 360 Estates' benefit. The Committee asserted that Mr. Dreier's purchases of various artworks are traceable to the preference recoveries. Federal prosecutors sought dismissal of the 360 Committee's bid, arguing that the funds used to buy the artworks cannot in all circumstances be traced to the preference recoveries. The Committee also argued that the victim restoration process under the authority of the Attorney General entails the pro rata distribution of forfeited property to Mr. Dreier's victims in accordance with the amounts of their losses. In a five-page decision, the Court held that to grant a constructive trust in favor of the 360 Estates would be unfair both to the other Dreier victims, whose funds were likewise stolen in connection with a fiduciary relationship. About Dreier LLP Marc Dreier founded New York-based law firm Dreier LLP -- http://www.dreierllp.com/-- in 1996. On December 8, 2008, the U.S. Securities and Exchange Commission filed a suit, alleging that Mr. Dreier made fraudulent offers and sales of securities in several cities, selling fake promissory notes to hedge and other private investment funds. The SEC asserted that Mr. Dreier also distributed phony financial statements and audit opinions, and recruited accomplices in connection with that scheme. Mr. Dreier has been charged by the U.S. government for conspiracy, securities fraud and wire fraud before the U.S. District Court for the Southern District of New York (Manhattan) (Case No. 09-cr-00085-JSR). Dreier LLP filed for Chapter 11 on December 16, 2008 (Bankr. S.D.N.Y., Case No. 08-15051). Judge Robert E. Gerber handles the case. Stephen J. Shimshak, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, has been retained as counsel. The Debtor listed assets between $100 million and $500 million, and debts between $10 million and $50 million in its filing. Wachovia Bank National Association, Sheila M. Gowan as trustee for Chapter 11 estate of Dreier LLP, and Steven J. Reisman as post- confirmation representative of the bankruptcy estate of 360networks (USA) Inc. signed a petition that sent Mr. Dreier to bankruptcy under Chapter 7 on January 26, 2009 (Bankr. S.D. N.Y., Case No. 09-10371). About 360networks Headquartered in Vancouver, British Columbia, 360networks, Inc. -- http://www.360.net/-- provides fiber optic communications network products and services worldwide. The company, together with 22 affiliates, filed for chapter 11 protection on June 28, 2001 (Bankr. S.D.N.Y. Case No. 01-13721), obtained confirmation of their plan on October 1, 2002, and emerged from chapter 11 on November 12, 2002. Alan J. Lipkin, Esq., and Shelley C. Chapman, Esq., at Willkie Farr & Gallagher, represented the company in the case. Lawyers at Dreier LLP represented the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed $6,326,000,000 in assets and $3,597,000,000 in liabilities. ACCESS PHARMACEUTICALS: Whitley Penn Raises Going Concern Doubt --------------------------------------------------------------- On March 23, 2010, Access Pharmaceuticals, Inc., filed its annual report on Form 10-K for the year ended December 31, 2009. Whitley Penn LLP, in Dallas, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of the Company's recurring losses from operations, negative cash flows from operating activities and accumulated deficit. The Company reported a net loss of $17,340,000 on $352,000 of revenue for the year ended December 31, 2009, compared with a net loss of $34,431,000 on $291,000 of revenue for 2008. The Company's balance sheet as of December 31, 2009, showed $1,583,000 in assets and $28,572,000 of debts, for a stockholders' deficit of $26,989,000. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c1b Dallas, Tex.-based Access Pharmaceuticals, Inc. is an emerging biopharmaceutical company focused on developing a range of pharmaceutical products primarily based upon its nanopolymer chemistry technologies and other drug delivery technologies. The Company currently has one approved product, two products at Phase 2 of clinical development and several products in pre-clinical development. ALERIS INT'L: $690 Million Rights Offering Gets Go Signal --------------------------------------------------------- Aleris International Inc. and its units obtained approval of a commitment agreement underpinning a $690 million rights offering to finance its reorganization plan. The Court authorized the Debtors to: (i) enter into an Equity Commitment Agreement, which will be between Aleris International, Inc., certain investment funds and accounts managed by Oaktree Capital Management, L.P. and its affiliates, certain investment funds and accounts affiliated with Apollo Investment VII, L.P., and certain investment funds and accounts managed or advised by Sankaty Advisors, LLC the "Backstop Parties"; and (ii) effectuate the contemplated transactions including, but not limited to, the payment by the Debtors of the Structuring Agreement Fee, the expenses of the Backstop Parties under the Equity Commitment Agreement, any amounts required to be paid pursuant to the indemnification provisions of the Equity Commitment Agreement, and the Termination Fee, on the terms and conditions set forth in the Equity Commitment Agreement. In collaboration with the Backstop Parties, the Debtors have formulated and are proposing a reorganization plan that provides a recovery to unsecured creditors, a substantial investment of new equity capital into the Debtors' businesses, a right-sizing of the Debtors' capital structure, and a restructuring of the Debtors' organization structure. The Debtors' proposed Plan of Reorganization contemplates that the reorganized Debtors will sell their assets to certain "OpCos," entities established for the purposes of acquiring those assets and operating the reorganized Debtors' businesses in the future. These entities will, in turn, be owned, directly or indirectly, by ACH Intermediate Co., which will be owned by ACH1 Holding Co. Among other things, the common stock of HoldCo will be contributed to the OpCos, used by the OpCos as part of the consideration paid to Reorganized Debtors for its assets, and then distributed by the Debtors under the Plan to certain creditors and participants in a Rights Offering pursuant to the Plan. Under the Plan, holders of U.S. Roll-Up Term Loan Claims, European Roll-Up Term Loan Claims, and European Term Loan Claims may participate in a Rights Offering of New Common Stock and notes issued by IntermediateCo, by purchasing units consisting of, in the aggregate, shares of New Common Stock and $45 million of exchangeable notes issued by IntermediateCo. The Rights Offering is expected to generate proceeds of up to $690 million. These proceeds will be used to fund distributions under the Plan, pay certain other costs associated with the Debtors' emergence from chapter 11, and ensure adequate liquidity for the Debtors upon emergence from chapter 11. The Rights Offering is backstopped by the Backstop Parties pursuant to, and subject to the terms and conditions of, the Equity Commitment Agreement. Under the Equity Commitment Agreement, the Backstop Parties have committed to purchase, and the Debtors have agreed to sell, all of the Subscription Units offered pursuant to the Rights Offering, but not purchased by other creditors. The Backstop Parties are further investing by purchasing shares of IntermediateCo Preferred Stock for $5 million. A full-text copy of the Equity Commitment Agreement is available for free at http://bankrupt.com/misc/Aleris_CommitmentAgmt.pdf About Aleris International Aleris International, Inc., produces and sells aluminum rolled and extruded products. Aleris operates primarily through two reportable business segments: (i) global rolled and extruded products and (ii) global recycling. Headquartered in Beachwood, Ohio, a suburb of Cleveland, the Company operates over 40 production facilities in North America, Europe, South America and Asia, and employs approximately 8,400 employees. Aleris operates 27 production facilities in the United States with eight production facilities that provided rolled and extruded aluminum products and 19 recycling production plants. Aleris International, Inc., aka IMCO Recycling Inc., and various affiliates filed for bankruptcy on February 12, 2009 (Bankr. D. Del. Case No. 09-10478). The Hon. Brendan Linehan Shannon presides over the cases. Stephen Karotkin, Esq., and Debra A. Dandeneau, Esq., at Weil, Gotshal & Manges LLP in New York, serve as lead counsel for the Debtors. L. Katherine Good, Esq., and Paul Noble Heath, Esq., at Richards, Layton & Finger, P.A. In Wilmington, Delaware, serves as local counsel. Moelis & Company LLC, acts as financial advisors; Alvarez & Marsal LLC as restructuring advisors, and Kurtzman Carson Consultants LLC as claims and noticing agent for the Debtors. As of December 31, 2008, the Debtors had total assets of US$4,168,700,000; and total debts of US$3,978,699,000. Bankruptcy Creditors' Service, Inc., publishes Aleris International Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Aleris International, Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) ALERIS INT'L: Hilco Completes Sale of Aluminum Foil Plant --------------------------------------------------------- Hilco Industrial, LLC, a distressed asset disposition and acquisition company, and its joint venture partners, announced the sale of an aluminum foil production facility, formerly owned by Aleris International, a global producer of aluminum rolled and extruded products, recycled aluminum, and specification alloys. The plant, located in Three Rivers, Quebec, Canada, was purchased by the joint venture from the estate of the bankrupt company for $10.5 million. Hilco then launched a worldwide marketing campaign to sell the facility in its entirety. An auction was staged on March 10, 2010, which drew more than 200 bidders. The winning bid for the facility in its entirety was from an undisclosed buyer located in the Peoples Republic of China. About Hilco Industrial, LLC Hilco Industrial provides industrial asset disposition services, specializing in selling machinery, equipment and inventory auctions and negotiated sales. It sells the broad range of industrial assets found in manufacturing, wholesale and distribution companies through on-site, online and combination "webcast" auction sale events as well as negotiated (private treaty) sales. Hilco Industrial is headquartered in Farmington Hills, Michigan, and maintains offices in key cities in North America and the United Kingdom. It is a unit of Hilco Trading, LLC, an international leader in asset valuation, acquisition, disposition and advisory services. About Aleris International Aleris International, Inc., produces and sells aluminum rolled and extruded products. Aleris operates primarily through two reportable business segments: (i) global rolled and extruded products and (ii) global recycling. Headquartered in Beachwood, Ohio, a suburb of Cleveland, the Company operates over 40 production facilities in North America, Europe, South America and Asia, and employs approximately 8,400 employees. Aleris operates 27 production facilities in the United States with eight production facilities that provided rolled and extruded aluminum products and 19 recycling production plants. Aleris International, Inc., aka IMCO Recycling Inc., and various affiliates filed for bankruptcy on February 12, 2009 (Bankr. D. Del. Case No. 09-10478). The Hon. Brendan Linehan Shannon presides over the cases. Stephen Karotkin, Esq., and Debra A. Dandeneau, Esq., at Weil, Gotshal & Manges LLP in New York, serve as lead counsel for the Debtors. L. Katherine Good, Esq., and Paul Noble Heath, Esq., at Richards, Layton & Finger, P.A. In Wilmington, Delaware, serves as local counsel. Moelis & Company LLC, acts as financial advisors; Alvarez & Marsal LLC as restructuring advisors, and Kurtzman Carson Consultants LLC as claims and noticing agent for the Debtors. As of December 31, 2008, the Debtors had total assets of US$4,168,700,000; and total debts of US$3,978,699,000. Bankruptcy Creditors' Service, Inc., publishes Aleris International Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Aleris International, Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) ALERIS INT'L: Modified Plan Offers 50% to Unsecureds ---------------------------------------------------- Aleris International Inc. and its debtor affiliates delivered to the U.S. Bankruptcy Court for the District of Delaware their modified First Amended Joint Plan of Reorganization and Disclosure Statement on March 19, 2010. The Modified First Amended Plan provides that the Reorganized Debtors will only be liable for Indenture Trustees' Fees and Expenses up to an aggregate amount of $1,000,000 for all series of Debt Claims, and if the aggregate amount asserted exceed $1,000,000, the Reorganized Debtors may, absent an agreement among the Indenture Trustees, apply to the Bankruptcy Court for a reasonable allocation of the amount payable. Under the Modified Amended Plan, the Debtors estimate that more than $23.5 million will be paid on account of prepetition, unsecured claims, with possible recoveries to certain unsecured creditors of up to 50%. U.S. Debtors Class 5 consists of all General Unsecured Claims other than Convenience Claims and Insured Claims. Pursuant to the Modified Amended Plan, on the Initial Distribution Date and each Distribution Date until the Final Distribution Date, each holder of an Allowed General Unsecured Claim will receive its Pro Rata Share of $16.5 million in Cash minus the aggregate amount of Cash previously received by the holder on the Initial Distribution Date and each other Distribution Date. The Backstop Parties have agreed with the Official Committee of Unsecured Creditors that, if the Plan is confirmed, they will waive any recovery with respect to Debt Claims held by the Backstop Parties that constitute U.S. Term Loan Claims. The Debtors estimate that this waiver will reduce the amount of Debt Claims participating in recoveries in Class 5 by approximately $100 million. Because holders of Allowed General Unsecured Claims other than Debt Claims do not receive the benefit of the subordination provisions relating to the Senior Subordinated Note Claims, if the ultimate Allowed General Unsecured Claims total $163 million, the Debtors estimate the recovery for Allowed General Unsecured Claims other than Debt Claims to be 0.8%. A full-text copy of the Modified Amended Plan is available for free at http://bankrupt.com/misc/Aleris_Modified1stAmPlan.pdf The Debtors also delivered to the Court exhibits to the Plan containing: * Acquisition Agreement * Amendment to the Claims Settlement Guidelines * Contribution Agreement * Equity Commitment Agreement * Form of IntermediateCo Note Indenture * Terms of the IntermediateCo Preferred Stock * Form of Registration Rights Agreement * Form of Stockholders Agreement * Terms of the Amendment to European Term Loan Facility * Form of Amended and Restated Organizational Documents of Holdco, IntermediateCo, and the Reorganized Debtors Full-text copies of the Exhibits are available for free at: http://bankrupt.com/misc/Aleris_PlanExhibits1.pdf Solicitation Schedule Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware formally signed on March 12, 2010, an order approving Aleris International, Inc. and its debtor affiliate's Disclosure Statement filed contemporaneously with their Chapter 11 Plan of Reorganization. The Court will convene a hearing on May 13, 2010, to consider confirmation of the Plan. Deadline for filing objections to Plan Confirmation is on April 29, 2010. The Court has set April 29, 2010, as the Voting Deadline. A full-text copy of the Disclosure Statement Order is available for free at http://bankrupt.com/misc/Aleris_DSorder.pdf On March 22, 2010, Judge Shannon entered an amended order changing the Solicitation Date to March 26, 2010. The Court also approved the Debtors' Voting and Solicitation Procedures. Full-text copies of the voting procedures and form of ballots are available for free at: http://bankrupt.com/misc/Aleris_VotingProcedures.pdf About Aleris International Aleris International, Inc., produces and sells aluminum rolled and extruded products. Aleris operates primarily through two reportable business segments: (i) global rolled and extruded products and (ii) global recycling. Headquartered in Beachwood, Ohio, a suburb of Cleveland, the Company operates over 40 production facilities in North America, Europe, South America and Asia, and employs approximately 8,400 employees. Aleris operates 27 production facilities in the United States with eight production facilities that provided rolled and extruded aluminum products and 19 recycling production plants. Aleris International, Inc., aka IMCO Recycling Inc., and various affiliates filed for bankruptcy on February 12, 2009 (Bankr. D. Del. Case No. 09-10478). The Hon. Brendan Linehan Shannon presides over the cases. Stephen Karotkin, Esq., and Debra A. Dandeneau, Esq., at Weil, Gotshal & Manges LLP in New York, serve as lead counsel for the Debtors. L. Katherine Good, Esq., and Paul Noble Heath, Esq., at Richards, Layton & Finger, P.A. In Wilmington, Delaware, serves as local counsel. Moelis & Company LLC, acts as financial advisors; Alvarez & Marsal LLC as restructuring advisors, and Kurtzman Carson Consultants LLC as claims and noticing agent for the Debtors. As of December 31, 2008, the Debtors had total assets of US$4,168,700,000; and total debts of US$3,978,699,000. Bankruptcy Creditors' Service, Inc., publishes Aleris International Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Aleris International, Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) ALION SCIENCE: Inks Pact with Credit Suisse on Sale of 12% Notes ---------------------------------------------------------------- Alion Science and Technology Corporation entered into a an agreement to sell to Credit Suisse Securities (USA) LLC, as "initial purchaser", 310,000 of the Company's units -- each Unit consisting of $1,000 principal amount of the Company's 12% Senior Secured Notes due November 1, 2014, and one detachable warrant to purchase approximately 1.9439 shares of common stock, par value $0.01 per share, of the Company. Credit Suisse also acted as sole bookrunner in connection with the Company's 2007 offering of its 10 1/4% Senior Unsecured Notes due 2015. In addition, affiliates of Credit Suisse acted as joint lead arranger, administrative agent, collateral agent and lender under the Company's previously existing Term B Senior Credit Facility and will act as sole lead arranger, administrative agent, and lender under the New Credit Agreement. Credit Suisse also serves as arranger, administrative agent and collateral agent under the New Credit Agreement. About Alion Science Alion Science and Technology Corporation, based in McLean, VA, is an employee-owned company that provides scientific research, development, and engineering services related to national defense, homeland security, and energy and environmental analysis. Particular areas of expertise include communications, wireless technology, netcentric warfare, modeling and simulation, chemical and biological warfare, program management. Revenues for the twelve month period ended June 30, 2009, were $770 million. * * * Alion carries a 'B-' corporate credit rating from Standard & Poor's. ALL LAND INVESTMENTS: Plan Confirmation Hearing Set for April 27 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware approved the disclosure statement explaining All Land investments, Inc.'s proposed Chapter 11 plan. As a result, the Debtors have sent solicitation packages to voting creditors. Ballots are due 5:00 p.m. (prevailing Eastern Time) on April 12, 2010. The Debtor will file its report on the results of the Plan voting by April 19. A hearing to consider confirmation of the Plan is scheduled for April 27, 2010, at 1:00 p.m. at the Bankruptcy Court, 824 North Market Street, Wilmington, Delaware. Objections, if any, must be received by the Court and notice parties no later than April 12, at 4:00 p.m. According to the amended Disclosure Statement, the Plan provides for holders of allowed general unsecured claims, totaling $8,644,700, to receive a pro rata distribution account of the claim from funds remaining, if any, after the payment of allowed administrative claims, allowed priority non-tax and tax claims, and secured claims. Based on the $18,000 being funded by Lawrence and Frank Zeccola for unsecured creditors, the Debtor estimates that allowed general unsecured claims will each receive a dividend of 12.7% of the claims within 30 days of the effective date. Existing equity interests will be cancelled and equity holders won't receive anything. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/AllLand_AmendedDS.pdf About All Land Investments Newark, Delaware-based All Land Investments, LLC, operates a real estate business. The Company filed for Chapter 11 bankruptcy protection on October 29, 2009 (Bankr. D. Del. Case No. 09-13790). Gary F. Seitz, Esq., at Rawle & Henderson LLP assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. AMBAC FINANCIAL: Regulator Assumes Control of Troubled Contracts ---------------------------------------------------------------- Ambac Assurance Corporation, the principal operating subsidiary of Ambac Financial Group, Inc., on March 24, 2010, established a segregated account pursuant to Wisc. Stat. Section 611.24(2) for: (i) certain policies insuring or relating to credit default swaps, (ii) all residential mortgage-backed securities policies (some of which will be allocated to the Segregated Account after it is established), (iii) certain other identified policies, including those relating to Las Vegas Monorail Company, (iv) certain student loan policies, AAC also allocated these to the Segregated Account: (i) all remediation claims, defenses, offsets, or credits (but excluding recoveries arising from remediation efforts or reimbursement or collection rights with respect to policies allocated to the Segregated Account), if any, in respect of the Segregated Account Policies, (ii) AAC's disputed contingent liability, if any, under the long-term lease with One State Street, LLC, and its contingent liability (as guarantor), if any, under the Ambac Assurance UK Limited lease with British Land, (iii) AAC's limited liability interests in Ambac Credit Products, LLC, Ambac Conduit Funding LLC, Aleutian Investments LLC and Juneau Investments LLC, and (iv) all of AAC's liabilities as reinsurer under certain reinsurance agreements. The purpose of the Segregated Account is to segregate certain segments of AAC's liabilities. The Segregated Account is capitalized by a $2 billion secured note due 2050 issued by AAC and an aggregate excess of loss reinsurance agreement provided by AAC. On the same day, the Office of the Commissioner of Insurance of the State of Wisconsin commenced rehabilitation proceedings with respect to the Segregated Account to permit the OCI to facilitate an orderly run-off or settlement of the liabilities allocated to the Segregated Account pursuant to the provisions of the Wisconsin Insurers Rehabilitation and Liquidation Act. The rehabilitation court has issued an injunction effective until further court order enjoining certain actions by Segregated Account policyholders and other counterparties, including the assertion of damages or acceleration of losses based on early termination and the loss of control rights in insured transactions. Pursuant to the Verified Petition filed in Wisconsin with such proceedings, the OCI has stated that it will, within approximately six months, seek the approval of the rehabilitation court for a plan of rehabilitation with respect to the Segregated Account. The Verified Petition states that the Segregated Account Rehabilitation Plan will, if approved, provide, among other things, that the holders of Segregated Account Policies shall receive in respect of claims made a combination of (i) cash and (ii) surplus notes with the same terms as the AAC Surplus Notes. Until the Segregated Account Rehabilitation Plan is approved, which OCI has indicated will be in approximately six months, it is anticipated that no claims will be paid on Segregated Account Policies. Dow Jones Newswires' Aparajita Saha-Bubna says the Wisconsin regulator took control of $35 billion in policies written by AAC. Those policies primarily cover principal and interest payments on souring mortgage securities. Dow Jones also reports that the regulator is negotiating a potential settlement to roughly $17 billion in contracts on complex financial products with a group of banks. The products -- collateralized-debt obligations -- are pools of securities that have sharply deteriorated in value. According to Dow Jones, policyholders began questioning Thursday whether a regulatory solution to $52 billion in troubled insurance underwritten by AAC would treat all policyholders equally after its regulator seized a part of its portfolio. "We still have a lot of questions to ask," said Harold Horwich, an attorney for 12 unnamed mutual-fund companies that organized to protect their investments, according to Dow Jones. The report says the group, which holds about $20 billion in municipal bonds insured by Ambac, wants to make sure the insurer has enough capital to support the bonds as it settles its other obligations. Dow Jones notes that a quirk in Wisconsin insurance law is driving the concern. Dow Jones explains that in many states, a process called rehabilitation is used by state regulators to seize the entirety of a troubled insurer. But, under Wisconsin law, the regulator can take charge of parts of the business, leaving the rest to operate as normal. "Typically, an order of rehabilitation gives the commissioner a great deal of latitude in restructuring," said Nick Pearson, an attorney at Edwards Angell Palmer & Dodge LLP, according to Dow Jones. Mr. Pearson said he isn't familiar with details on the rehabilitation process on Ambac's portfolio, Dow Jones relates. In a separate report, Dow Jones' Aparajita Saha-Bubna says the regulator will suspend payments totaling about $120 million for March 2010 to holders of the contracts. As long as the regulator is overseeing these contracts, monthly payments beyond March are also suspended, Dow Jones says. According to Dow Jones, the commissioner's office will seek to unwind those insurance contracts that Ambac sold to financial firms but can't fully pay off without jeopardizing claims of other policyholders. Those contracts being unwound were intended to protect investors mainly from losses on mortgage securities. Dow Jones notes that Ambac in 2009 paid out $1.4 billion in claims to policyholders, according to an annual filing with its regulator. The payments were primarily related to losses on securities made up of souring mortgage loans, according to people familiar with the matter, Dow Jones reports. Dow Jones further relates that an executive who led the negotiations for Citigroup Inc. said in an e-mailed statement: "We are pleased to have a fair settlement of this extremely complex and difficult situation, and we are particularly appreciative of the creative and evenhanded work of" the insurance regulator "in bringing the parties together." Dow Jones says Citigroup's exposure to Ambac, using a "fair value" estimate, is $4.5 billion, according to Citigroup's annual report. Citigroup has reserves of about $5.5 billion for exposure to so- called monoline insurers, including Ambac, in the event they are unable to fulfill their commitments. Additional details on the rehabilitation proceedings are available at no charge at http://ResearchArchives.com/t/s?5c28 About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial Group, Inc. common stock is listed on the New York Stock Exchange (ticker symbol ABK). Ambac's principal operating subsidiary is Ambac Assurance Corporation, a guarantor of public finance and structured finance obligations. Ambac Assurance has earned a Caa2 rating from Moody's Investors Service, Inc., with a developing outlook and a CC rating from Standard & Poor's Ratings Services with a developing outlook. Moody's Investors Service at the end of July 2009 downgraded to Caa2 from Ba3 the insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited. The rating action was prompted by Ambac's announced large loss reserve increase and credit impairment charge estimated for the second quarter of 2009. Dow Jones notes Ambac once boasted top triple-A credit ratings. In November 2009, Ambac warned it could have problems paying off debt that comes due in 2011. According to Dow Jones, Ambac Financial said it was considering strategies that include a prepackaged bankruptcy-court filing. Before the financial crisis, Ambac was the second-biggest bond insurer behind MBIA Inc. AMBAC FINANCIAL: May Seek Bankruptcy Protection ----------------------------------------------- Ambac Financial Group, Inc., warned that its regulator's move to assume Ambac Assurance Corporation's troubled contracts may impact the parent company. Ambac Financial explained that its liquidity, both on a near-term basis and a long-term basis, is largely dependent on dividends and other payments from AAC. As a result of the rehabilitation proceedings with respect to the Segregated Account, it is highly unlikely that AAC will be able to make dividend payments to the Company for the foreseeable future. Ambac Financial said its principal uses of liquidity are for the payment of principal and interest on its debt, its operating expenses, and capital investments in, and loans to, its subsidiaries. Further, other contingencies -- e.g., an unfavorable outcome in the outstanding class action lawsuits against the Company -- could cause additional liquidity strain. Ambac Financial said, while it does not believe the Segregated Account Rehabilitation Proceedings constitute an event of default under its bond indentures, it may consider, among other things, a negotiated restructuring of its outstanding debt through a prepackaged bankruptcy proceeding or may seek bankruptcy protection without agreement concerning a plan of reorganization with major creditor groups. No assurance can be given that the Company will be successful in executing any or all of these strategies. While management believes that the Company will have sufficient liquidity to satisfy its needs through the second quarter of 2011, no guarantee can be given that it will be able to pay all of its operating expenses and debt service obligations thereafter, and its liquidity may run out prior to the second quarter of 2011. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial Group, Inc. common stock is listed on the New York Stock Exchange (ticker symbol ABK). Ambac's principal operating subsidiary is Ambac Assurance Corporation, a guarantor of public finance and structured finance obligations. Ambac Assurance has earned a Caa2 rating from Moody's Investors Service, Inc., with a developing outlook and a CC rating from Standard & Poor's Ratings Services with a developing outlook. Moody's Investors Service at the end of July 2009 downgraded to Caa2 from Ba3 the insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited. The rating action was prompted by Ambac's announced large loss reserve increase and credit impairment charge estimated for the second quarter of 2009. Dow Jones notes Ambac once boasted top triple-A credit ratings. In November 2009, Ambac warned it could have problems paying off debt that comes due in 2011. According to Dow Jones, Ambac Financial said it was considering strategies that include a prepackaged bankruptcy-court filing. Before the financial crisis, Ambac was the second-biggest bond insurer behind MBIA Inc. AMBAC FINANCIAL: Clients May Receive 25% in Cash ---------------------------------------------- Bloomberg News reports that Ambac Financial Group Inc.'s insurance regulator said that Ambac's clients will probably get about 25 cents on the dollar in cash for claims on about $35 billion of home-loan bonds backed by the insurer. "Currently, my expectation is we'd be at approximately 25 cents cash" on the portfolio, with Ambac meeting the rest of its obligation by handing over surplus notes, Wisconsin Insurance Commissioner Sean Dilweg said in an interview with Bloomberg. The arrangement isn't final until approved by a court, he said. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial Group, Inc. common stock is listed on the New York Stock Exchange (ticker symbol ABK). Ambac's principal operating subsidiary is Ambac Assurance Corporation, a guarantor of public finance and structured finance obligations. Ambac Assurance has earned a Caa2 rating from Moody's Investors Service, Inc., with a developing outlook and a CC rating from Standard & Poor's Ratings Services with a developing outlook. Moody's Investors Service at the end of July 2009 downgraded to Caa2 from Ba3 the insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited. The rating action was prompted by Ambac's announced large loss reserve increase and credit impairment charge estimated for the second quarter of 2009. Dow Jones notes Ambac once boasted top triple-A credit ratings. In November 2009, Ambac warned it could have problems paying off debt that comes due in 2011. According to Dow Jones, Ambac Financial said it was considering strategies that include a prepackaged bankruptcy-court filing. Before the financial crisis, Ambac was the second-biggest bond insurer behind MBIA Inc. AMERICA'S SUPPLIERS: MalongBailey LLP Raises Going Concern Doubt ---------------------------------------------------------------- On March 23, 2010, America's Suppliers, Inc., formerly Insignia Solutions, PLC, filed its annual report on Form 10-K for the year ended December 31, 2009. MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that Company has suffered an accumulated deficit of $6,949,006 as of December 31, 2009. The Company reported a net loss of $848,808 on revenue of $12,750,550 for the year ended December 31, 2009, compared with net income of $102,996 on revenue of $12,275,231 for 2008. The Company's balance sheet as of December 31, 2009, showed $1,312,933 in assets and $1,674,669 of debts, for a stockholders' deficit of $361,736. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c17 Scottsdale, Ariz.-based America's Suppliers, Inc. through its wholly-owned subsidiary DDI Inc., develops software programs that allow the Company to provide general merchandise from third party manufacturers and suppliers for resale to businesses through the Company's Web site at http://www.DollarDays.com AMERICAN LOCKER: Santa Monica Partners Holds 8.3% of Common Stock ----------------------------------------------------------------- Santa Monica Partners, L.P., beneficially owns directly 132,578 shares, constituting 8.3% of the Outstanding Shares of American Locker Group Incorporated. SMP Asset Management LLC, the general partner of Santa Monica Partners, beneficially owns indirectly the 132,578 Shares. Lawrence J. Goldstein, the president and sole owner of SMP Asset Management and a principal of Humonica Asset Management, LLC, a registered investment adviser, beneficially owns indirectly an aggregate of 177,523 Shares, constituting 11.2% of the Outstanding Shares, consisting of 132,578 Shares owned by Santa Monica Partners and 44,950 Shares held by client accounts, constituting 2.8% of the Outstanding Shares. The beneficial ownership of such Shares is disclaimed by SMP Asset Management and Mr. Goldstein. About American Locker Group American Locker Group Incorporated (ALGI.PK) -- http://www.americanlocker.com/, http://www.canadianlocker.com; and http://www.securitymanufacturing.com-- is known for its proven reliability, durability and customer service. American Locker is the only locker company to operate a dedicated center to provide prompt and reliable service to their customers. American Locker is used by thousands of water parks, theme parks, ski resorts, retailers, law enforcement agencies, and health club operators around the world. As of September 30, 2009, the Company had total assets of $7,823,419 and total liabilities of $3,606,037 in total liabilities. According to the Troubled Company Reporter on February 27, 2009, the Company has warned that unless it is able to enter into an acceptable extension or forbearance agreement with the Bank and obtain additional financing, the Company might be forced to restructure its debts under the protection of Chapter 11 of the U.S. Bankruptcy Code. AMR CORP: Sees $4.9 Billion Cash Balance at End of Q1 ----------------------------------------------------- AMR Corporation updated its year 2010 guidance to investors, saying that it expects to end the first quarter with a cash and short-term investment balance of about $4.9 billion including about $460 million in restricted cash and short-term investments. AMR said in the guidance that first quarter mainline unit revenue is expected to increase between 6.5% and 7.5% year over year while first quarter consolidated unit revenue is expected to increase between 6.8% and 7.8%. In total, Cargo and Other Revenue is anticipated to increase between 4.1% and 5.1% relative to first quarter 2009. A full-text copy of the Updated Guidance, which was posted at the Securities and Exchange Commission, is available for free at http://ResearchArchives.com/t/s?5c0f About AMR Corporation Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, including Brazil, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. At Dec. 31, 2009, AMR reported total assets of $25.438 billion, including total current assets of $6.642 billion; against total current liabilities of $7.728 billion, long-term debt, less current maturities of $9.984 billion, obligations under capital leases, less current obligations of $599 million, other liabilities and credits of $10.616 billion; resulting in stockholders' deficit of $3.489 billion. * * * AMR carries a 'CCC' issuer default rating from Fitch Ratings. It has 'Caa1' corporate family and probability of default ratings from Moody's. It has 'B-' corporate credit rating, on watch negative, from Standard & Poor's. ARIZONA EQUIPMENT: Installment-Payment Plan Confirmed by Court -------------------------------------------------------------- The Hon. Eileen W. Hollowell of the U.S. Bankruptcy Court for the District of Texas confirmed Arizona Equipment Rental I, LLC's amended Plan of Reorganization. According to the Disclosure Statement, the Plan provides for holders of general unsecured claims, including lease rejection claims to receive monthly payments of interest only at the rate of 5.5% per annum beginning 30 days after the effective date of the Plan for five years, with an automatic option in favor of the reorganized Debtor for an additional five years of monthly payments of interest only to the holders of these claims if the payments under the Plan on year five are current. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/Arizonaequipment_AmendedDS.pdf Arizona Equipment is represented by: John R. Clemency, Esq. Lindsi M. Weber GALLAGHER & KENNEDY, P.A. Tel: (602) 530-8000 Fax: (602) 530-8500 E-mail: john.clemency@gknet.com E-mail: lindsi.weber@gknet.com Tucson, Arizona-based Arizona Equipment Rental I, LLC, was founded by Lance Evic and Jeffrey Bleecker in 2004 as a Volvo Rents franchise construction equipment rental company serving Arizona. AER is headquartered in Tucson, Arizona, and currently employs approximately 30 employees. The business however has been hit by the slow down in the construction and mining industry. The Company filed for Chapter 11 bankruptcy protection on October 30, 2009 (Bankr. D. Ariz. Case No. 09-27946). The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. ANTHRACITE CAPITAL: Al Togut Serves as Chapter 7 Trustee -------------------------------------------------------- Albert Togut, Esq., at Togut Segal & Segal, LLP, has been appointed the Chapter 7 trustee to oversee the liquidation of Anthracite Capital, Inc.'s estate. Albert Togut, Esq. Togut Segal & Segal, LLP One Penn Plaza, Suite 3335 New York, NY 10119 Tel: (212) 594-5000 Fax: (212) 967-4258 E-mail: alcourt@teamtogut.com As reported by the Troubled Company Reporter, Anthracite Capital filed for Chapter 7 of the Bankruptcy Code on March 15, 2010 (Bankr. S.D.N.Y. Case No. 10-11319). Judge Arthur J. Gonzalez presides over the case. The Garden City Group, Inc., serves as claims and notice agent. The Company disclosed estimated assets of $100 million to $500 million, and estimated debts of $500 million to $1 billion. The Company's board of directors authorized the Chapter 7 filing in light of the Company's financial position, outstanding events of default under the Company's secured and unsecured debt and other factors. The Company indicated that, in a liquidation, it is likely that shareholders would not receive any value and that the value received by unsecured creditors would be minimal. 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. BASS PRO: S&P Assigns Corporate Credit Rating at 'BB-' ------------------------------------------------------ Standard & Poor's Ratings Services said that it has assigned its 'BB-' corporate credit rating to Springfield, Mo.-based Bass Pro Group LLC, an outdoor recreational specialty retailer. At the same time, S&P assigned an issue-level rating of 'BB-' (the same as the corporate credit rating) to the company's proposed $400 million term loan B with a '4' recovery rating, indicating S&P's expectation of average (30%-50%) recovery in the event of default. Proceeds from the term loan will be used to repay borrowings under the existing revolver. Concurrent with this transaction, the company will launch a new $300 million asset-based loan facility, unrated by S&P. "The ratings on Bass Pro Group LLC reflect its participation in the highly competitive and widely fragmented outdoor recreation market, the recent weak performance of its Tracker Marine Group, and its aggressive capital structure; these are partially offset by the company's good market position and diversified product offering," said Standard & Poor's credit analyst David Kuntz. Bass participates in the competitive and fragmented outdoor recreation segment. Key selling strengths include its in-depth knowledge about the merchandise it sells and the local region. The stores are built as a "destination" location, where consumers come from the surrounding area, spend substantial amounts of time, and are able to test much of the merchandise. However, the company does face significant competition from other outdoor recreation retailers such as Cabela's, discounters such as Wal- Mart, and more traditional sporting good retailers. BEAR MOUNTAIN: Gets Creditor Protection Under CCAA -------------------------------------------------- PricewaterhouseCoopers, the court-appointed monitor, said that the Supreme Court of British Columbia entered an order March 25 placing Bear Mountain Master Partnership under creditor protection pursuant to the Companies' Creditors Arrangement Act. The CCAA order results in creditors and other third parties being stayed from terminating agreements or otherwise taking any steps against Bear Mountain. Prowis Inc. has been appointed the Chief Restructuring Officer for Bear Mountain. Over the past nine years, the Bear Mountain development has been a major contributor to the growth of the local community resulting in many new businesses and hundreds of jobs being created. It has received international acclaim for Southern Vancouver Island as a world-class golf destination. Both customers and suppliers can be assured that, while restructuring measures are implemented, it will be business as usual at Bear Mountain Resort with no interruption to the large number of events that are planned to take place, including all conference reservations, golf tournaments and the esteemed TELUS World Skins Game to be held June 21 and 22, 2010. The company's bank has indicated that it will provide continued support during the restructuring. The Monitor and the Chief Restructuring Officer will be communicating with customers and suppliers in the near future. Any inquiries can be addressed in writing to the Monitor as follows: PricewaterhouseCoopers Inc. Suite 700-250 Howe Street Vancouver, B.C. V6C 3S7 Phone: 604-806-7717 (voice mail only) E-mail: bearmountain@ca.pwc.com BERNARD MADOFF: Owes $984,280 in Sales Tax to New York State ------------------------------------------------------------ Tom Topousis, writing for the New York Post, says Bernard Madoff owes the state of New York $984,280 in sales tax by his now- defunct securities firm. According to the Post, Mr. Madoff joined the ranks of New York's 250 top tax deadbeats this month at No. 68 on the list. "But when it comes to collecting from the disgraced financier, the state has to get in line with investors looking for pennies on the dollar out of what the feds have collected from his leftover cash and the sale of his homes and yachts," Mr. Topousis writes. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert $64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) BIV RETAIL: Foreclosure Sale to Close by Month's End ---------------------------------------------------- Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports that, according to papers filed by The Hollywood Motion Picture and Television Museum with the Bankruptcy Court in Los Angeles, Regions Bank in January 2010 agreed to sell Belle Island Village to Tennessee Investment Partners LLC for $19.5 million in a deal slated to close by March 31. According to Ms. Palank, the buyer is partially owned by Tennessee-based real estate investment firm Matisse Capital LLC and by Belle Island Village's original developer. Belle Island Village was a proposed resort destination in Pigeon Forge, Tennessee. It was supposed to house Debbie Reynolds' The Hollywood Motion Picture and Television Museum. Construction lender Regions Bank foreclosed on the unfinished development in 2009. Belle Island Village's developer, BIV Retail, LLC, filed for Chapter 7 bankruptcy protection on March 25, 2009 (Bankr. E.D. Tenn. Case No. 09-31579). BOSQUE POWER: Files for Chapter 11 Bankruptcy in Texas ------------------------------------------------------ Bosque Power Co. LLC, together with five of its affiliates, filed for Chapter 11 protection in Waco, Texas (Bankr. W.D. Tex. Case No. 10-60348). The Company estimated assets and debts of between $100 million and $500 million as of the filing. The 30 largest unsecured creditors are owed more than $700,000. According to Reuters, Bosque Power, a power company, disclosed that it loaned $412 million in January 2008 to fund the conversion of its combustion turbines. Laguna Park, Texas-based Bosque Power Company, LLC, owns and operates a natural gas fired power plant with a capacity of 800 megawatts. The power-generating facility, located in Laguna Park, commenced operations as a natural-gas power plant in 2000. Bosque sells its energy and ancillary services in the Texas power market. Bosque Power Partners owns 100% of the membership interest in Bosque Power. Affiliate BosPower Development, BosPower Development Blocker I, BosPower Development Blocker II, BosPower Partners and Fulcrum Marketing and Trade also sought bankruptcy protection. BRIDGEVIEW AEROSOL: Exclusivity Period Extended Until April 30 -------------------------------------------------------------- Judge Pamela S. Hollis of the U.S. Bankruptcy Court for the Northern District of Illinois signed off on an agreed order extending the exclusivity periods for debtors Bridgeview Aerosol LLC, AeroNuevo LLC, and USAerosols, LLC: -- the Debtors' exclusive period to file a Chapter 11 plan is extended to April 30, 2010; and -- the Debtors' exclusive period to solicit acceptances on the plan is extended to June 30, 2010 Wells Fargo Bank and the official committee of unsecured creditors agreed to the extension. The Debtors have originally requested for a May 28 extension of their exclusive plan filing deadline, and a July 30 extension of their exclusive solicitation deadline. The Extension Order also provides that upon the Debtors' request, neither Wells Fargo nor the Committee will unreasonably withhold its consent to an additional 30 days' extension of the exclusive periods. The Debtors are represented in the case by: Steven B. Towbin, Esq. Mark L. Radtke, Esq. Kimberly Bacher, Esq. SHAW GUSSIS FISHMAN GLANTZ WOLFSON & TOWBIN LLC 321 North Cark Street, Suite 800 Chicago, Illinois 60654 Steven B. Towbin, Esq. E-mail: stowbin@shawgussis.com mradtke@shawgussis.com kbacher@shawgussis.com Wells Fargo Bank is represented in the case by: Norman B. Newman, Esq. MUCH SHELIST DENENBERG AMEND & RUBENSTEIN, P.C. 191 N. Wacker Dr., Suite 1800 Chicago, Illinois 60606 E-mail: nnewman@muchshelist.com The official committee of unsecured creditors is represented by: Adam Silverman, Esq. ADELMAN & GETTLEMAN, LTD. 53 W. Jackson Blvd., Suite 1050 Chicago, Illinois 60604 About Bridgeview Aerosol Bridgeview, Illinois-based Bridgeview Aerosol, LLC is in the custom aerosol specialty products industry. BVA provides a wide array of services relating to aerosol products including initial product formulation, testing, manufacturing, packaging and distribution. BVA primarily manufactures, packages and distributes household cleaning and automotive products. Affiliate AeroNuevo owns the real property on which BVA operates. USAerosols is the parent company of BVA and AeroNuevo. Bridgeview Aerosol filed for Chapter 11 bankruptcy protection on October 30, 2009 (Bankr. N.D. Ill. Case No. 09-41021). In its schedules of assets and debts filed in December 2009, Bridgeview Aerosol disclosed $16,312,338 in total assets and $23,621,655 in total debts. BRIDGEVIEW AEROSOL: Cash Collateral Hearing Set for April 1 ----------------------------------------------------------- The Hon. Pamela H. Hollis of the U.S. Bankruptcy Court for the Northern District of Illinois, will consider at a hearing on April 1, 2010, at 10:30 a.m., the continued use of Bridgeview Aerosol, LLC, Aeronuevo, LLC, and USAerosols, LLC, of Well Fargo Bank, National Association's cash collateral. The Court, in a fifth interim order, granted the Debtors access to WFB's cash collateral until April 2, 2010. The Debtors would use the cash collateral to operate their business and to facilitate the reorganization of their balance sheets and business. The Debtors owe $12,000,000 on a secured loan. Wells Fargo, the lender, has consented to Debtors' use of cash collateral, subject to a permitted variance of 10% per line item. The Debtors will make provisional interest payments to Wells Fargo as adequate protection for any diminution in value of its collateral: (a) $36,251 per month for their use of the cash collateral, plus (b) $13,901 per month for the Debtors' use of the property in Bridgeview, Illinois, that AeroNuevo owns. The Debtors will also grant Wells Fargo Bank liens of the highest available priority upon any asset that the Debtors acquire postpetition and any proceeds generated from the property; and adequate protection liens, which will be subject only to prior perfected and unavoidable liens in property of the Debtors' estate as of the Petition Date. In case the adequate protection liens and provisional interest payments are inadequate, Wells Fargo will have an allowed claim against the Debtors' estates that will be superior to any claim, whether an administrative of priority claim, against the Debtors' estates. The Debtors and any other parties in interest may file a reply to WFB's objections on March 30, 2010. The hearing will also be an evidentiary hearing if WFB's objections will not be resolved prior to the hearing. About Bridgeview Aerosol Bridgeview, Illinois-based Bridgeview Aerosol, LLC is in the custom aerosol specialty products industry. BVA provides a wide array of services relating to aerosol products including initial product formulation, testing, manufacturing, packaging and distribution. BVA primarily manufactures, packages and distributes household cleaning and automotive products. Affiliate AeroNuevo owns the real property on which BVA operates. USAerosols is the parent company of BVA and AeroNuevo. Bridgeview Aerosol filed for Chapter 11 bankruptcy protection on October 30, 2009 (Bankr. N.D. Ill. Case No. 09-41021). Steven B. Towbin, Esq., at Shaw Gussis et al assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. BUFFETS HOLDINGS: Seeking Replacement $250-Mil. Term Loan --------------------------------------------------------- Carla Main at Bloomberg News reports that Buffets Holdings Inc. is looking for lenders who will accept interest composed of cash with a company option to defer part of the payment until a later date. The report, citing people involved in the private discussions, said Buffets is seeking a $250 million first-lien term loan to replace exit borrowings and cut finance costs. Credit Suisse Group AG is arranging the loan. The Company is offering to pay 8 percentage points more than the London interbank offered rate in cash and another 2 percentage points with a payment-in-kind option. About Buffets Holdings Headquartered in Eagan, Minnesota, Buffets Holdings Inc. -- http://www.buffet.com/-- is the parent company of Buffets, Inc., which operates 626 restaurants in 39 states, comprised of 615 steak-buffet restaurants and eleven Tahoe Joe's Famous Steakhouse restaurants, and franchises sixteen steak-buffet restaurants in six states. The restaurants are principally operated under the Old Country Buffet, HomeTown Buffet, Ryan's and Fire Mountain brands. Buffets, Inc., employs approximately 37,000 team members and serves approximately 200 million customers annually. Buffets and all of its subsidiaries filed Chapter 11 protection on January 22, 2008 (Bankr. D. Del. Case Nos. 08-10141 to 08-10158). Joseph M. Barry, Esq., M. Blake Cleary, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor LLP, represent the Debtors in their restructuring efforts. The Debtors selected Epiq Bankruptcy Solutions LLC as claims and balloting agent. The U.S Trustee for Region 3 appointed seven creditors to serve on an Official Committee of Unsecured Creditors. The Committee selected Otterbourg Steindler Houston & Rosen PC and Pachulski Stang Ziehl Young & Jones as counsels. Buffets emerged from Bankruptcy in April 2009. In connection with its Chapter 11 plan, Buffets obtained a $117.5 million in new first lien exit financing from various lenders. This financing was in addition to a $139.8 million in second lien rollover financing remaining from the pre-petition lenders. BWAY CORP: S&P Changes Outlook to Positive; Affirms 'B+' Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Atlanta-based BWAY Corp. to positive from stable. The 'B+' corporate credit rating and all other ratings are affirmed. The company reported total debt of $398 million at Dec. 31, 2009. "The outlook revision reflects BWAY's improving profitability and cash flow despite the effects of lower volumes in the company's metal and plastic packaging segments," said Standard & Poor's credit analyst James Siahaan. S&P believes that the company's plant rationalization and cost reduction efforts will continue to support its financial results in 2010. If the company's operating performance continues to improve, and if BWAY demonstrates prudence with respect to the level of debt financing incorporated in potential acquisitions, then its funds from operations to total debt ratio may approach the 20%-area, at which point S&P would likely consider an upgrade. The ratings on BWAY reflect the company's aggressive financial risk profile that offsets its business position as a leading producer of metal and plastic general-line containers, including those used for coating applications. BWAY, with annual sales of about $1 billion, mainly produces plastic containers and general-line metal containers for packaging paints, solvents, and household products in the U.S. market. C BEAN: Section 341(a) Meeting Scheduled for May 6 -------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of creditors in C. Bean Transport, Inc.'s Chapter 11 case on May 6, 2010, at 10:00 a.m. The meeting will be held at Isaac C. Parker Courthouse, 30 S. 6th Street, Fort Smith, AR 72901. 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. Amity, Arkansas-based C. Bean Transport, Inc., filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. W.D. Ark. Case No. 10-71360). Chad J. Kutmas, Esq., at Doerner, Saunders, Daniel & Anderson, LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. C BEAN: Asks for Court's Nod to Use Cash Collateral --------------------------------------------------- C. Bean Transport, Inc., has sought authorization from the U.S. Bankruptcy Court for the Western District of Arkansas to use the cash collateral from March 18 to May 14, 2010. The accounts receivable consists the cash collateral. General Electric Capital Corporation asserts a security interest and lien in all accounts receivable of the Debtor and proceeds thereof. Federal Financial Credit, Inc., asserts a security interest and lien in all accounts receivable of the Debtor and proceeds thereof, which FFCI is believed to recognize is junior to the interest of GECC in accounts receivable. The Debtor is engaged in discussion with GECC and FFCI seeking a consensual cash collateral order, which, if achieved, will be presented to the Court. The accounts receivable which are believed to be subject to the asserted security interests claims of GECC and FFCI are accounts receivable generated by the operations of the Debtor through its two operating divisions, the Dry Van Division of Fort Smith, Arkansas, and the Flat Bed Division of Amity, Arkansas. As of March 19, 2010, the C. Bean accounts receivable include a face value amount of $1,690,836 for the Fort Smith, Arkansas, Dry Van Division, and $591,497 for the Flat Bed Division of Amity, Arkansas. Chad J. Kutmas, Esq., at Doerner, Saunders, Daniel & Anderson, L.L.P., the attorney for the Debtor, explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/C_BEAN_budget.pdf The Debtor believes that GECC and FFCI are adequately protected for the use of its cash collateral due to the equity in other assets in which each holds or does not have a security interest. As additional adequate protection, the Debtor is prepared to grant GECC and FFCI replacement liens in estate property in the same priority as those parties enjoyed prepetition subject to a determination that GECC and FFCI have properly perfected and valid security interests in the property pursuant to their loan documents with the Debtor. FFCI Objects FFCI has objected to the Debtor's request to use cash collateral, saying that it holds a properly perfected security interest in all of the Debtor's assets. FFCI states that its blanket lien may be inferior to a lien claim in accounts receivable to a purported lien claim by GECC. According to FFCI, there is in excess of $400,000 of accounts receivable over and above the lien claim of GECC. "Therefore, FFCI holds a first position lien on those accounts receivable and a first lien on all other assets of the Debtor with the exception of any first lien claim on rolling stock (tractors and trailers) pledged to other secured creditors," FFCI states. As of the date of filing of the bankruptcy, the total amount that the Debtor owes to FFCI totals $1,435,244 plus continuing interest, late charges, costs and legal fees. According to FFCI, the Debtor has failed to: -- use the cash collateral in accordance with the requirements of the loan documents governing the loans; -- use the cash collateral to make the payments on the loans; -- segregate the cash collateral into a separate account; and -- account to FFCI for use of the cash collateral. FFCI says that the Debtor is using its cash collateral without its consent. The Debtor's unauthorized use of cash collateral is diminishing FFCI's collateral and secured position on the loans, FFCI adds. FFCI objects to the use of its collateral for any purpose other than to reduce the indebtedness owed to it. "The Court should require the Debtor to provide FFCI with adequate protection of its security interest in the Cash Collateral by: (a) requiring the Debtor to bring current all past due but unpaid obligations owing to FFCI under the terms of the Loans; (b) requiring the Debtor to pay its additional obligations under the Loans as they become due; (c) requiring that FFCI's Cash Collateral shall at all times hereafter, be segregated in an identifiable separate account which is not co-mingled with other funds; and (d) ordering the cash collateral be used only to first satisfy payments on the FFCI Loans and next to pay taxes, insurance and maintenance on the collateral," FFCI states. FFCI is represented by Richard L. Ramsay, Esq., at Eichenbaum, Liles & Heister, P.A., who can be reached at rick.ramsay@elhlaw.com by e-mail. About C Bean Amity, Arkansas-based C. Bean Transport, Inc., provides trucking and transportation services and owns and manages certain real estate with operations and facilities centered in Sebastian County, Arkansas. The Company filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. W.D. Ark. Case No. 10-71360). Chad J. Kutmas, Esq., at Doerner, Saunders, Daniel & Anderson, LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. C BEAN: Taps Doerner Saunders as Bankruptcy Counsel --------------------------------------------------- C. Bean Transport, Inc., has sought permission from the U.S. Bankruptcy Court for the Western District of Arkansas to employ Doerner, Saunders, Daniel & Anderson, L.L.P., as bankruptcy counsel. DSDA will: a. take necessary or appropriate actions to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any action commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections to claims filed against the estate; b. prepare motions, applications, answers, orders, reports, and other papers in connection with the administration of the estate; c. take necessary or appropriate actions in connection with a Chapter 11 plan and related disclosure statement and all related documents, as well as such further actions as may be required in connection with the administration of the estate, including an orderly liquidation of assets; and d. perform all other necessary legal services in connection with the Debtor's Chapter 11 case. Gary M. McDonald, a partner at DSDA, says that the firm will be paid based on the hourly rates of its personnel: Gary M. McDonald $325 Chad J. Kutmas $225 Paralegals $95-$105 Mr. McDonald assures the Court that DSDA is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. The Debtor has also filed an application to employ Smith, Cohen & Horan, P.L.C., as co-counsel to the Debtor. DSDA has advised the Debtor that it will carefully monitor and coordinate all efforts of all professionals retained by the Debtor in its Chapter 11 case and will clearly delineate their respective duties so as to prevent duplication of effort, wherever possible. Amity, Arkansas-based C. Bean Transport, Inc., provides trucking and transportation services and owns and manages certain real estate with operations and facilities centered in Sebastian County, Arkansas. The Company filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. W.D. Ark. Case No. 10-71360). The Company estimated its assets and debts at $10,000,001 to $50,000,000. C BEAN: Wants to Hire Smith Cohen as Co-Counsel ----------------------------------------------- C. Bean Transport, Inc., sought authorization from the U.S. Bankruptcy Court for the Western District of Arkansas to employ Smith, Cohen & Horan, PLC, as co-counsel. SCH will: a. take necessary or appropriate actions to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any action commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections to claims filed against the estate; b. prepare motions, applications, answers, orders, reports, and other papers in connection with the administration of the estate; c. take necessary or appropriate actions in connection with a Chapter 11 plan and related disclosure statement and all related documents, as well as such further actions as may be required in connection with the administration of the estate, including an orderly liquidation of assets; and d. perform all other necessary legal services in connection with the Debtor's Chapter 11 case. Don A. Smith, a partner at SCH, says that the firm will be paid based on the hourly rates of its personnel: Don A. Smith $200 Eric L. Pendergrass $200 Paralegals $95-$105 Mr. Smith assures the Court that SCH is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. The Debtor has filed an application to employ Doerner, Saunders, Daniel & Anderson, L.L.P., as bankruptcy counsel. DSDA and SCH have advised the Debtor that they will carefully monitor and coordinate all efforts of all professionals retained by the Debtor in its Chapter 11 bankruptcy case and will clearly delineate their respective duties to prevent duplication of effort, wherever possible. Amity, Arkansas-based C. Bean Transport, Inc., provides trucking and transportation services and owns and manages certain real estate with operations and facilities centered in Sebastian County, Arkansas. The Company filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. W.D. Ark. Case No. 10-71360). The Company estimated its assets and debts at $10,000,001 to $50,000,000. C BEAN: Wants May 15 Extension of Schedules Filing Deadline ----------------------------------------------------------- C. Bean Transport, Inc., has asked the U.S. Bankruptcy Court for the Western District of Arkansas to extend until May 15, 2010, the deadline for the filing of schedules of assets and liabilities, schedules of executory contracts and unexpired leases, lists of equity security holders, schedules of current income and expenditures, statements of financial affairs statement of financial affairs, and initial report. The Debtor says that it needs the 45-day extension to assemble the necessary information from its books, records, and other sources relating to numerous assets and contracts, as well as thousands of creditors. According to the Debtor, the compilation of information within 14 days would be a significant burden on the Debtor and its limited professionals, and could adversely impact the Debtor and its professionals' focus on substantive matters related to its Chapter 11 case. Amity, Arkansas-based C. Bean Transport, Inc., provides trucking and transportation services and owns and manages certain real estate with operations and facilities centered in Sebastian County, Arkansas. The Company filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. W.D. Ark. Case No. 10-71360). Chad J. Kutmas, Esq., at Doerner, Saunders, Daniel & Anderson, LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. CALIFORNIA: Increases Size of Taxable Bond Sale to $3.4 Billion --------------------------------------------------------------- Dow Jones Newswires' Stan Rosenberg reports that California on Wednesday increased the size of a planned $2.5 billion taxable bond sale to $3.4 billion. California also raised the price for the bond. Dow Jones says investors are so eager to purchase debt from the state. "Right now, the bonds are between two and three times oversubscribed," said one person familiar with the deal earlier Wednesday, according to Dow Jones. "It is clear that pension managers around the world believe in the Golden State relative to 'expected' returns on equities," said Michael Pietronico, chief executive of New York-based Miller Tabak Asset Management, Dow Jones reports. Dow Jones relates that the upsizing comes just two weeks after California boosted a $2 billion offering of tax-exempt debt to $2.5 billion on voracious demand from yield-hungry investors. Dow Jones says the current offering also started out at $2 billion, was boosted to $2.5 billion earlier this week and now to $3.4 billion. Dow Jones relates that earlier in the session, underwriters tested demand for the latest bonds at levels ranging up to 2.75 and 3.25 percentage points above comparable Treasury securities. Dow Jones says based on Treasurys prices at the time, those "spreads" would have produced yields of 7.4% and 7.9%, levels difficult to turn down. Now, the spreads have narrowed for key maturities and sizes of those maturities increased to accommodate demand. According to Dow Jones, the newest sale will be formally priced Thursday. CAROLINA FIRST: S&P Affirms 'B+/B' Counterparty Credit Ratings -------------------------------------------------------------- Standard & Poor's said that it affirmed its 'B+/B' counterparty credit ratings on Carolina First Bank. These ratings were subsequently withdrawn at the company's request. CITIGROUP INC: Treasury Mulls Sale of 27% Stake ----------------------------------------------- The Wall Street Journal's Randall Smith, citing people familiar with the matter, reports that the Treasury Department is exploring plans to sell its 27% stake in Citigroup Inc. in a program of regularly scheduled sales. According to the Journal, Jeffrey Harte, an analyst at Sandler O'Neill & Partners LP, said the move is likely to ease investor worries that the U.S. government might sell some of its 7.7 billion shares "through a big negotiated block sale at a discount" to the market price. The Journal says a Treasury spokesman declined to comment. According to the Journal, Citigroup's annual report indicates the Treasury also owned $5.3 billion of Citigroup trust-preferred securities and warrants to buy 465.1 million shares as of Dec. 31. The U.S. government acquired the securities in 2008 and 2009 as part of its efforts to stabilize the shaky financial system, the Journal says. 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: Annual Shareholders' Meeting on April 29 ------------------------------------------------------------- The annual meeting of shareholders of Coachmen Industries, Inc., will be held at the Christiana Creek Country Club, 116 West Bristol Street, Elkhart, Indiana, on April 29, 2010, at 10:00 a.m., for these purposes: 1. To elect three directors of the Company to hold office for the terms indicated in the proxy statement. 2. To amend the Articles of Incorporation of the Company to change the name of the Company to All American Group, Inc.; and 3. To transact such other business as may properly come before the meeting or any adjournment thereof. Shareholders of record at the close of business on March 15, 2010, are entitled to notice of and to vote at the meeting. A full-text copy of the Company's proxy statement is available at no charge at http://ResearchArchives.com/t/s?5c1c 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. CONSOL ENERGY: S&P Downgrades Corporate Credit Rating to 'BB' ------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its corporate credit rating on Canonsburg, Pa.-based coal and natural gas producer Consol Energy Inc. to 'BB' from 'BB+'. At the same time, S&P lowered the issue-level rating on the company's 7.875% senior secured notes to 'BBB-' (two notches above the corporate credit rating) from 'BBB'. The recovery rating remains '1', indicating S&P's expectation of very high (90%-100%) recovery in the event of a payment default. S&P also assigned a 'BB' (same as the corporate credit rating) issue-level rating to the company's proposed senior unsecured notes offering. The recovery rating is '3', indicating S&P's expectations of meaningful (50%-70%) recovery in the event of a payment default. S&P removed all ratings from CreditWatch, where they had been placed with negative implications on March 15, 2010. The rating outlook is negative. "S&P considers Consol's willingness to fund the large acquisition of Dominion's natural gas assets with a high proportion of debt to be aggressive, and S&P expects that its pro forma financial profile will remain somewhat weak for the current rating during the intermediate term, with total adjusted debt to EBITDA exceeding 4x for the next couple of years," said Standard & Poor's credit analyst Marie Shmaruk. Somewhat offsetting these concerns is the somewhat stronger overall business risk profile as a result of the proposed acquisition, which gives Consol a more balanced portfolio of natural gas and coal assets. Moreover, low natural gas prices could stress the balance sheet further and delay the company's ability to exploit its reserves and to deleverage to a level that S&P would consider to be more in-line with the rating. In addition, S&P is concerned about the challenges of integrating and developing its significant gas reserves and the meaningful capital expenditures that are required to develop gas reserves. S&P's rating also takes into account its expectation that management will take the necessary steps to adjust its discretionary spending levels, to match market conditions, such that its credit measures do not deteriorate meaningfully from pro forma levels. CRESCENT RESOURCES: Sending Plan to Creditors for Voting -------------------------------------------------------- Dawn McCarty at Bloomberg News reports that U.S. Bankruptcy Judge Craig Gargotta ruled that Crescent Resources LLC's submitted a disclosure statement that provides adequate information for creditors to make an informed decision on its reorganization plan. Accordingly, Crescent will be sending the Plan to creditors for voting. Crescent Resources LLC filed an amended reorganization plan on March 11. Significant terms of the Amended Plan include: -- Holders of prepetition secured debt will receive a combination of reinstated debt and 100% of the equity of the reorganized company. Holders of the prepetition lenders claims aggregating $1.55 billion will recover 38% of their claims. -- General unsecured creditors owed a total of $305.4 million will receive an interest in a litigation trust to be formed as part of the Plan. -- Various project level lenders will have their existing debt reinstated. Lazard estimates the Reorganized Debtors' enterprise value to range from approximately $588 million to approximately $665 million, with a midpoint of roughly $626 million. The Reorganization Value was based on the estimated enterprise value of the operations and assets of the Reorganized Debtors through the application of, among other analyses, a discounted cash flow valuation methodology of the Debtors' operations using a range of discount rates from 15% to 20%, which imputed a present value of free cash flows of those operations over the life of the business. Black-lined versions of the Amended Plan and Disclosure Statement are available for free at: http://bankrupt.com/misc/Crescent_AmendedDS.pdf http://bankrupt.com/misc/Crescent_AmendedPlan.pdf The Official Committee of Unsecured Creditors is opposing the Plan. It believes that a Chapter 7 liquidation will yield higher recoveries for unsecured creditors. About Crescent Resources Crescent Resources, LLC -- http://www.crescent-resources.com/-- is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Based in Charlotte, North Carolina, Crescent Resources is a joint venture between Duke Energy and the Morgan Stanley Real Estate Funds. Established in 1969, Crescent creates mixed-use developments, award-winning country club communities, single- family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Crescent Resources and 120 affiliates filed separate chapter 11 petitions on June 10, 2009 (Bankr. W.D. Tex. Lead Case No. 09- 11507). The Hon. Craig A. Gargotta presides over the case. Attorneys at Weil Gotshal Manges LLP represent the Debtors in their Chapter 11 cases. Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., serves as the Debtors' co-counsel. Garden City Group serves as claims and notice agent. The Debtors disclosed more than $1 billion each in assets and debts when they filed for bankruptcy. COOPER-STANDARD: Disclosure Statement Hearing to Resume Today ------------------------------------------------------------- Cooper-Standard Holdings Inc. and its debtor-affiliates filed with the U.S. Bankruptcy Court for the District of Delaware an amended joint Chapter 11 plan of reorganization on March 20, 2010. The Debtors amended the Plan after they reached a new equity commitment agreement with a majority of holders for notes due in both 2012 and 2014 that would allow them to generate $355 million of proceeds by selling stock and warrants. The new commitment agreement, which provides for a sale of stock and warrants and a commitment to backstop an equity rights offering, replaced the deal the Debtors hammered out with certain noteholders last month. The initial deal provided for a direct investment and equity rights offering that only totaled $245 million. Under the new Equity Commitment Agreement, the noteholders including those that took part in the initial deal, agreed to purchase 11.75% of the new common stock and $100 million of 7% convertible preferred stock, convertible into 19.7% of the new common stock, issued by the reorganized company. They will receive new warrants to purchase 7% of the new common stock. The noteholders will also provide a backstop for any portion of the new common stock in the rights offering that has not been purchased to ensure a total investment of $355 million. This commitment is conditioned on the approval of the Equity Commitment Agreement and confirmation of the amended Plan. Among those that agreed to backstop the rights offering are Barclays Bank PLC, Silver Point Capital L.P., funds associated with American Funds and TCW, and investment adviser, Lord Abbett & Co. LLC, which acts on behalf of its clients. A full-text copy of the new Equity Commitment Agreement is available for free at http://bankrupt.com/misc/CSHI_NewECA.pdf "The proposed $355 million equity investment is a strong vote of confidence in Cooper-Standard and significantly improves the recoveries to the company's stakeholders over those of the original plan," James McElya, chairman and chief executive officer of Cooper-Standard, said in a statement. "The company is now positioned to emerge from bankruptcy in the near term on a consensual basis with a strong balance sheet while maintaining our leadership position in the industry," Mr. McElya said. According to the Debtors' attorney, Drew Sloan, Esq., at Richards Layton & Finger P.A., in Wilmington, Delaware -- dsloan@rlf.com -- the proceeds from the new rights offering, together with the exit financing, would provide the Debtors with sufficient capital to pay off claims that stemmed from the December 23, 2004 credit agreement and the senior notes. The Debtors have already filed a motion in the Bankruptcy Court to approve the Equity Commitment Agreement and a process for the consummation of the rights offering, as well as a motion to file under seal schedules to the agreement. A copy of the document detailing the proposed process is available for free at http://researcharchives.com/t/s?5b91 The Court will hold a hearing on the motions on March 26, 2010. The Court will also consider approval of the Debtors' Disclosure statement describing the Amended Plan at the March 26 Hearing, according to papers filed in Court. The hearing was originally set for March 18 but was adjourned to that date. Plan Amendments Under the amended Plan, CSHI's debtor-in-possession financing and prepetition credit facility will still be paid in full in cash. General unsecured claims against CS Automotive and all of its debtor subsidiaries will still receive payment in full in cash. The amended Plan, however, now provides for the senior note claims to be unimpaired and to be paid in full in cash, provided each of the supporting senior noteholders has agreed to forgo its right to receive cash payment, and in lieu of this right, has agreed to accept its pro rata share of 4,563,095 shares of the new common stock. The supporting senior noteholders include Barclays Bank, Capital Research and Management Company, Oak Hill Advisors L.P., Silver Point Capital and their affiliates. Meanwhile, holders of the senior subordinated notes will be issued 8% of the new common stock and new warrants to purchase 3% of the stock. They will also receive rights to purchase 39.6% of the new common stock. The amended Plan still requires the Debtors to obtain a new working capital facility of up to $150 million, which is another condition to confirmation of the Plan. A CSHI spokesman said the company is still discussing the terms of its exit financing agreement, according to a report by Reuters. Under the amended Plan, CSHI's balance sheet will be deleveraged with an estimated funded debt balance at emergence of about $480 million, which represents a reduction of over $650 million. CSHI had total liabilities of more than $1 billion when it filed for bankruptcy protection on August 3, 2009. Directors of the Reorganized Debtors The Board of Directors that will be formed to administer the reorganized company on and after the effective date of the Plan will be composed of seven members including the chief executive officer of the reorganized company and two members from the current Board of Directors of CSHI who will be selected by the Debtors. Under the amended Plan, Barclays Capital, Oak Hill Advisors and Silver Point can each nominate one member to the Board. The seventh member to be nominated will be picked by Capital Research and Management Company, Lord Abbett, TCW Asset Management Company and TD Asset Management Inc. Valuation of the Debtors Lazard Freres & Co. LLC, the Debtors' financial adviser, has estimated that the total value available for distribution to holders of allowed claims ranges from $975,000,000 to $1,075,000,000, with a mid-point estimate of about $1,025,000,000 as of an assumed effective date of May 1, 2010. The distributable value is based on the estimated value of the reorganized Debtors' operations on a going concern basis. Full-text copies of the Debtors' amended Plan and disclosure statement are available for free at: http://bankrupt.com/misc/CSHI_1stAmendedCh11plan.pdf http://bankrupt.com/misc/CSHI_DS1stAmendedCh11plan.pdf Allen Campbell, vice-president and chief executive officer of CSHI, said the amended Plan has the support of the majority of the noteholders and the Official Committee of Unsecured Creditors. In another development, Cooper-Standard Automotive Canada Ltd., the Canadian subsidiary of CSHI that sought creditor protection under the Companies' Creditors Arrangement Act, filed a plan of arrangement or compromise with the Ontario Superior Court of Justice on March 12, 2010. U.S. Trustee Objects Roberta DeAngelis, Acting United States Trustee for Region 3, has questioned a provision in the amended Plan which seeks for a release of claims held by parties-in-interest against non-Debtor third parties. Ms. DeAngelis complained that in the proposed form of ballot, the Debtors do not provide entities who vote in favor of the Plan the ability to "opt out" of the third-party release. She said the Debtors' refusal to untie the third-party release from a "yes" vote on the Plan is inconsistent with applicable law. Ms. DeAngelis also opposed the Debtors' request to file under seal certain schedules to the Equity Commitment Agreement, arguing that not all information contained in the documents are confidential. Ms. DeAngelis said information about the purchase obligations of the noteholders which the Debtors want to seal would not unfairly prejudice or otherwise harm the noteholders' commercial interests. Ms. DeAngelis further said that information related to the Debtors' ability to conduct their businesses outside of the ordinary course and information related to their intellectual property, legal proceedings and environmental matters should be accessible to the public. She pointed out that those information are critical to understanding the Debtors' representations, warranties and covenants under the Equity Commitment Agreement and if they are getting value in exchange for their commitments under the agreement. With respect to the Debtors' motion to approve the Equity Commitment Agreement, Ms. DeAngelis filed a separate statement to reserve her right to be heard on all issues relating to the motion. U.S. Bank Withdraws Objection U.S. Bank National Association notified the Court that it has withdrawn its objection to the proposed deal between the Debtors and the noteholders to backstop the equity rights offering. Treatment of Claims Claims against, and interests in Cooper-Standard Holdings Inc. and its subsidiary debtors are divided into 10 classes under the first amended joint Chapter 11 plan of reorganization. Priority tax claims and administrative expenses have not been classified and are excluded from these classes: Type of Class Claim/Interest Proposed Treatment ----- -------------- ------------------ Not applicable Administrative The Debtors or the Expenses reorganized Debtors will pay each allowed administrative expense in full in cash. Not applicable Priority Tax Claim Each claimant will be (about $3 million entitled to receive cash estimated) payment or other treatment agreed to by the claimant and the Debtors or the reorganized Debtors. Class 1 Priority Claims Unimpaired. Claimant is (approximately entitled to receive cash $250,000 estimated) in an amount sufficient to render the claim unimpaired, provided that allowed priority claims representing obligations incurred in the ordinary course will be paid in full or performed by the Debtors or reorganized Debtors consistent with past practice. Class 2 Miscellaneous Unimpaired. The rights of Secured Claims the claimant will remain (approximately unaltered. The claimant $0 estimated) will retain any liens and interests securing the claim or the Debtors will provide other treatment that will render the claim unimpaired. Class 3 Intercompany Claim Unimpaired. At the option (approximately of the Debtors or the $1.087 billion reorganized Debtors, the estimated) rights of the claimant will remain unaltered and treated in the ordinary course of business; or the intercompany claim will be cancelled and discharged, in which case the discharged and satisfied portion will be eliminated and the holders thereof will not be entitled to, and will not receive or retain, any property or interest in property on account of such portion; or the intercompany claim will be settled and discharged in exchange for property of the Debtors; provided that intercompany claims against any Debtor held by a non-debtor subsidiary will remain unaltered. Class 4 Prepetition Credit Unimpaired. Claimant will Facility Claims receive payment in full ($658.416 million, in cash. including principal plus accrued prepetition and postpetition interest calculated at the applicable nondefault rate or rates (including interest on interest) through May 1, 2010) plus any accrued postpetition interest from May 2, 2010 to the effective date at the applicable non-default rate or rates (including interest on interest) Class 5 Senior Note Claims Unimpaired. Each claimant ($219.250 million, will receive payment in including principal full in cash, provided plus prepetition that each supporting and postpetition senior noteholder agrees interest calculated to forgo its right to at the applicable receive payment in full in nondefault rate cash, and in lieu thereof, through May 1, 2010 agrees to accept in full plus any satisfaction of its postpetition allowed claim, and in interest from consideration for its May 2, 2010 to the allowed claim and its effective date at commitment under the new the applicable Equity Commitment non-default rate or Agreement, less favorable rates and any other treatment consisting of amount the Court its pro rata share of may order as 4,563,095 shares of the necessary to render new common stock. Class 5 unimpaired) Class 6 Senior Subordinated Impaired. Each claimant Note Claims claimant is entitled to ($330 million) receive its pro rata share of, in the aggregate, 1,742,222 shares or about 8% of the new common stock and warrants to acquire an additional 725,926 shares or about 3% of the new common stock. Each eligible noteholder is entitled to receive its share of rights to subscribe for up to, in the aggregate, 8,623,491 shares or about 39.6% of the new common stock, with the right to purchase additional shares not subscribed for. Each non- eligible noteholder will receive its pro rata share of the non-eligible noteholder shares. Class 7 Subsidiary Debtor Unimpaired. Each claimant General Unsecured is entitled to receive Claims (about cash in an amount $22.2 million sufficient to render its estimated) claim unimpaired. Class 8 Subsidiary Debtor Unimpaired. The legal, Equity Interests equitable and contractual rights of the holder will remain unaltered. Class 9 Holdings General Impaired. All claims will Unsecured Claims be extinguished and no (about $69.113 distributions will be made million estimated) to the claimants. Class 10 Old Holdings Equity Impaired. All interests Interests will be cancelled and extinguished and no distributions will be made to holders of such interests. The estimated recovery for administrative expenses, priority tax claims, and Classes 1 to 8, excluding Class 6, is 100%. Classes 9 and 10 have 0% recovery. Meanwhile, the estimated recovery for Class 6 is 25.8% assuming there is full participation of holders of allowed senior subordinated note claims in the rights offering; or 15.4% assuming there is no participation from those holders. Holders of Class 6 Senior Subordinated Note Claims are entitled to vote on the Plan, while Classes 1 to 5 and Classes 7 to 10 are not entitled to vote. About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, is a leading global automotive supplier specializing in the manufacture and marketing of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and NVH control systems. The Company is one of the leading suppliers of chassis products in North America, with about 14% of market share. The Company's main custoemrs include Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen, BMW, Fiat and Honda, among other automakers. Cooper-Standard Automotive employs approximately 16,000 people globally with more than 70 facilities throughout the world. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. In its bankruptcy petition, the Company said that assets on a consolidated basis total $1,733,017,000 while debts total $1,785,039,000 as of March 31, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- COOPER-STANDARD: Duff & Phelps Approved for Asset Valuation ----------------------------------------------------------- Cooper-Standard Holdings Inc. and its debtor-affiliates obtained court approval to employ Duff & Phelps LLC as their asset valuation provider effective January 28, 2010. The Debtors tapped the firm to provide valuation of their personal and real properties, customer contracts, technology- related intangible assets, trademarks, among other things. The firm is also tasked to make valuation of the reporting units owned by the Debtors including CSA North America, CSA Europe, CSA South America and CSA Asia Pacific, and equity investments including Nishikawa Standard Company, Guyoung Technology Co. LTD and Shanghai SAIC-Metzler Sealing. Also part of Duff & Phelps' duties is to provide valuation of Cooper-Standard Automotive (Deutschland) GmbH, Cooper-Standard Automotive Ceska republika s.r.o, and Cooper-Standard Automotive Polska Sp. z.o.o., and make estimation of the replacement cost of some of the Debtors' tangible assets. Duff & Phelps will be paid for its services on an hourly basis and will be reimbursed for its expenses. The hourly rates of the firm's professionals are: Professionals Hourly Rates ------------- ------------ Managing Director $565 Director $515 Vice-President $415 Senior Associate $320 Analyst $235 Administrative $120 The firm estimates that its fees for the services will be about $625,000 to $690,000. Steven Shanker, managing director at Duff & Phelps, assures the Court that his firm does not hold or represent interest adverse to the Debtors, and that it is a disinterested person pursuant to Section 101(14) of the Bankruptcy Code. About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, is a leading global automotive supplier specializing in the manufacture and marketing of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and NVH control systems. The Company is one of the leading suppliers of chassis products in North America, with about 14% of market share. The Company's main custoemrs include Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen, BMW, Fiat and Honda, among other automakers. Cooper-Standard Automotive employs approximately 16,000 people globally with more than 70 facilities throughout the world. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. In its bankruptcy petition, the Company said that assets on a consolidated basis total $1,733,017,000 while debts total $1,785,039,000 as of March 31, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- COOPER-STANDARD: Plan Exclusivity Extended Until June 29 -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware granted Cooper-Standard Holdings Inc. and its debtor-affiliates a three- month extension of their exclusive right to file a Chapter 11 plan and solicit votes for that plan. The Court extended the Debtors' plan filing deadline to June 29, 2010, and the solicitation deadline to August 30, 2010. The extension elicited support from the Official Committee of Unsecured Creditors. The panel said it will give the Debtors enough time to negotiate the terms of a plan that will provide the highest recovery for unsecured creditors. Separately, the Court gave Cooper-Standard Holdings Inc. and its affiliated debtors until June l, 2010, to file notices of removal of civil actions pending as of their bankruptcy filing. About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, is a leading global automotive supplier specializing in the manufacture and marketing of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and NVH control systems. The Company is one of the leading suppliers of chassis products in North America, with about 14% of market share. The Company's main custoemrs include Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen, BMW, Fiat and Honda, among other automakers. Cooper-Standard Automotive employs approximately 16,000 people globally with more than 70 facilities throughout the world. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. In its bankruptcy petition, the Company said that assets on a consolidated basis total $1,733,017,000 while debts total $1,785,039,000 as of March 31, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- COOPER-STANDARD: Reaches $17.6MM Settlement With Cooper Tire ------------------------------------------------------------ Cooper-Standard Holdings Inc. asks the U.S. Bankruptcy Court for the District of Delaware to approve a settlement of a lawsuit that Cooper Tire & Rubber Company brought against CSHI, Cooper- Standard Automotive Inc. and Cooper-Standard Automotive Canada Ltd. Under the deal, CSHI and its units agreed to pay Cooper Tire $17,639,080 in cash in return for the dismissal of the lawsuit. The defendants also agreed to either obtain a release of Cooper Tire's obligations under a 1996 guaranty or to provide a letter of credit in the initial sum of $7 million to reimburse Cooper Tire for any amount that it is required to pay on account of the guaranty. Cooper Tire serves as guarantor of a lease for a property between Bank of New York and CSA Inc. under the 1996 guaranty. The deal also requires CS Automotive to continue to indemnify Cooper Tire for certain workers compensation liabilities. Meanwhile, Cooper Tire is required to continue to indemnify CS Automotive with respect to certain environmental matters pursuant to the stock purchase agreement. The settlement is formalized in a 17-page agreement, a copy of which is available for free at: http://bankrupt.com/misc/CSHI_CooperTireSettlement.pdf Cooper Tire brought the lawsuit against the defendants to compel CSHI to remit about $60 million in tax refunds, which CSA Canada received in July 2009 as well as to recover $42.5 million in additional tax refunds yet to be received. Cooper Tire asserts ownership of the tax refunds based on the stock purchase agreement that was executed in connection with the sale of its automotive units, comprised of CS Automotive and CSA Canada, to CSHI in 2004. The Court will hold a hearing on April 15, 2010, to consider approval of the settlement. Deadline for filing objections is April 8, 2010. About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, is a leading global automotive supplier specializing in the manufacture and marketing of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and NVH control systems. The Company is one of the leading suppliers of chassis products in North America, with about 14% of market share. The Company's main custoemrs include Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen, BMW, Fiat and Honda, among other automakers. Cooper-Standard Automotive employs approximately 16,000 people globally with more than 70 facilities throughout the world. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. In its bankruptcy petition, the Company said that assets on a consolidated basis total $1,733,017,000 while debts total $1,785,039,000 as of March 31, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- CRYOPORT INC: Enable Capital Holds 9.9% of Common Stock ------------------------------------------------------- Enable Capital Management, LLC; Enable Growth Partners, L.P.; and Mitchell S. Levine, as managing member, disclosed that as of February 25, 2010, they may be deemed to beneficially own in the aggregate 838,982 shares or roughly 9.9% of the common stock of CryoPort Inc. On February 5, 1010, the Company effected a 1-for-10 reverse stock split of all of the Company's issued and outstanding shares of common stock. As reported by the Troubled Company Reporter, CryoPort on February 19, 2010, entered into an Amended and Restated Amendment Agreements with Enable Growth Partners LP, Enable Opportunity Partners LP, Pierce Diversified Strategy Master Fund LLC, Ena, and BridgePointe Master Fund Ltd., who are the Holders of the Company's outstanding Original Issue Discount 8% Senior Secured Convertible Debentures dated September 27, 2007 and Original Issue Discount 8% Secured Convertible Debentures dated May 30, 2008, and associated warrants to purchase common stock. CryoPort said the February 2010 Amendment amended and restated the amendment agreements that the Company and Holders entered into on January 12, 2010 and February 1, 2010. On February 23, 2010, the Company and Holders entered into an additional amendment to modify the February 2010 Amendment. Pursuant to the February 2010 Amendment, the Holders confirmed their prior agreement to defer until March 1, 2010, the Company's obligation to make the January 1, 2010 and February 1, 2010 debenture amortization payments -- each in the aggregate amount of $200,000) and their consent to the Company's recent 10-to-1 reverse stock split. In addition, subject to the Company consummating a public offering of units -- each unit consisting of one share of common stock and one warrant to purchase one share of common stock -- for gross proceeds of not less than $5,000,000 at a per unit price of not less than $3.00 per unit, the Holders have consented and agreed, among other items, to: -- each will convert $1,357,215 in principal amount of the outstanding principal balance of such holder's debenture in exchange for a number of shares of common stock determined by dividing such principal amount by the unit offering price for the public offering; -- with respect to the remaining outstanding balance of the debentures after conversion, the Company would not be obligated to make any principal or interest payments until March 1, 2011, at which time the Company would be obligated to start making monthly principal and interest payments of $200,000 for a period of 17 months with a final balloon payment due on August 1, 2012. In addition, the future interest that would accrue on the outstanding principal balance from July 1, 2010 (the date to which accrued interest was previously added to principal) to March 1, 2011 will be added to the current principal balance of the debentures; -- the conversion price of the remaining outstanding balance of each Debenture will be equal to the lesser of the current conversion price of $4.50 or the unit offering price; -- the exercise price of the Warrants currently held by the Holders will be equal to the lesser of the current exercise price of $4.50 per share or the exercise price of the warrants included as part of the units sold in this offering and the exercise period shall be extended to January 1, 2015; -- the termination of certain anti-dilution provisions contained in the Debentures and Warrants held by the Holders and their right to maintain a fully-diluted ownership of the Company's common stock equal to 34.5%; -- the termination of certain financial covenants; and -- each will execute a lock-up agreement covering a period of 180 days from the effective date of the registration statement; provided, however, that in the event that on any trading day during the lock-up period the trading price of the Company's common stock exceeds 200% of the offering price of the units, then each Holder may sell at sales prices equal to or greater than 200% of such unit offering price a number of shares of common stock on that trading day equal to up to 10% of the aggregate trading volume of the Company's common stock on the primary market on which it is trading on such Open Trading Day, and (ii) in the event on any trading day during the lock-up period the trading price of the Company's common stock exceeds 300% of the unit offering price, each Holder may sell at sales prices equal to or greater than 300% of such unit offering price an unlimited number of shares of common stock on such Open Trading Day. Sales under the foregoing clause (ii) on any particular Open Trading Day shall not be aggregated with sales under the foregoing clause (i) on the same Open Trading Day for purposes of calculating the 10% limitation under clause (i). In the event that the Company does not consummate this offering at a price of $3.00 per unit for minimum gross proceeds of $5,000,000 by March 15, 2010, then the provisions shall be null and void (provided, however, the exercise period for the warrant shall remain extended to January 1, 2015). About CryoPort Inc. Headquartered in Lake Forest, Calif., CryoPort, Inc. (OTC BB: CYRXD) -- http://www.cryoport.com/-- provides innovative cold chain frozen shipping system dedicated to providing superior, affordable cryogenic shipping solutions that ensure the safety, status and temperature of high value, temperature sensitive materials. The Company has developed a line of cost-effective reusable cryogenic transport containers capable of transporting biological, environmental and other temperature sensitive materials at temperatures below 0� Celsius. At December 31, 2009, the Company's consolidated balance sheets showed $1,964,134 in total assets and $21,585,470 in total liabilities, resulting in a $19,621,336 shareholders' deficit. The Company's consolidated balance sheets at December 31, 2009, also showed strained liquidity with $895,205 in total current assets available to pay $20,092,678 in total current liabilities. Going Concern In its report on Form 10-Q for the period ended December 31, 2009, the Company said it has not generated significant revenues from operations and has no assurance of any future revenues. The Company generated revenues from operations of $35,124, incurred a net loss of $16,705,151 and used cash of $2,586,470 in its operating activities during the year ended March 31, 2009. The Company generated revenues from operations of $42,888, had net loss of $5,085,376, and used cash of $1,941,693 in its operating activities during the nine months ended December 31, 2009. In addition, the Company had a working capital deficit of $19,197,473, and had cash and cash equivalents of $647,308 at December 31, 2009. The Company's working capital deficit at December 31, 2009, included $13,740,633 of derivative liabilities, the balance of which represented the fair value of warrants and embedded conversion features related to the Company's convertible debentures which were reclassified from equity during the nine months ended December 31, 2009. Currently management has projected that cash on hand, including cash borrowed under the convertible debentures issued in the first, second, and third quarter of fiscal 2010, will be sufficient to allow the Company to continue its operations only into the fourth quarter of fiscal 2010. These matters raise substantial doubt about the Company's ability to continue as a going concern. CVR ENERGY: May Eventually Take Business Public, Moody's Says ------------------------------------------------------------- Moody's Investors Service has made corrections to paragraphs three and eight of a March 18, 2010 release. The revised release is: Moody's upgraded CVR Energy, Inc.'s Corporate Family Rating to B1 from B2, Probability of Default Rating to B1 from B2, its bank revolver to Ba3 (LGD 2; 29%) from B2 (LGD 3; 31%) and affirmed CVR's SGL-3 Speculative Grade Liquidity rating. Moody's also assigned a Ba3 (LGD 2; 29%) rating to CVR's pending $250 million offering of first lien senior secured notes due 2010 and a B3 (LGD 5; 79%) rating to its pending $250 million of second lien senior secured notes due 2017. Importantly, the note and revolver ratings assume the issuance of $250 million in second lien senior notes. The rating outlook is stable. Note proceeds will be used to repay CVR's remaining $453.3 million (at February 28, 2010) Tranche D first secured Term Loan balance. Moody's will withdraw the B2 term loan rating upon its retirement. The revolver, CVR's existing swaps, the first lien notes and any future first lien debt will share first lien security on total assets, with the second lien notes behind them. If CVR replaces its revolver with an asset based lending facility, that facility would be granted a first lien on receivables and inventory and a second lien on fixed assets. First lien debt would remain first on fixed assets and would have a second lien on receivables and inventory. Second lien debt would be reduced to a third lien position. In spite of a continuing serious sector downturn, the new ratings reflect CVR's consistent sound, though reduced, earnings during the down-cycle, the earnings benefit and diversification provided by CVR's low cost internally generated petroleum coke gas-fired fertilizer business, favorable inland location and ample access to somewhat discounted crude oil feed, and the added earnings power and complexity of the Coffeyville refinery after the completion of several years of substantial upgrading capital spending. CVR reduced leverage on complexity barrels due both to increased complexity capacity after capital spending and reduced debt. Comparatively low expected capital spending in 2010 and 2011 relative to expected cash flow leaves room for further debt reduction. The ratings are restrained by CVR's comparatively small scale and low level of risk diversification as a single stand-alone refinery; very difficult sector conditions expected during the 2010 and 2011; significant leverage when weighed against the fact that a standalone refinery is exposed to inherent significant unscheduled downtime risk; potential forthcoming increased capital outlays if CVR proceeds with a potential fertilizer expansion; the reduced fuel cost advantage of CVR's fertilizer business during current times of reduced natural gas prices, high fixed costs in the fertilizer unit, and likelihood that CVR will remain in an acquisition mode to reduce portfolio risk. Moody's believes that CVR would remain a disciplined acquirer. Its ratings incorporate the expectation that any acquisitions would be of a suitably attractive refinery, that an added refinery would diversify key operating risks, and that it would be amply funded with equity relative to reasonable cash flow expectations and the complexity barrels purchased. Furthermore, though operating only one refinery, downtime risk is moderated to a degree by process redundancy in key units: atmospheric and vacuum distillation, the coker, distillate hydrotreating and sulfur recovery, and in sources of essential hydrogen. However, the diversification benefit of the fertilizer business is also moderated by the fact that the refinery must be up and running to produce the petroleum coke by-product the fertilizer plant consumes in lieu of buying natural gas as fuel and feedstock. A further restraint is that CVR may eventually take its fertilizer business public as a Master Limited Partnership. That business is currently a private limited partnership. The collateral language in CVR's current revolver prevents cash distributions to the general partner (CVR's controlling private shareholders plus management) of the fertilizer business, although non-cash distributions are being accrued and would presumably one day be paid in cash. After $521 million invested in its refinery since 2005, including capacity expansion, a new continuous catalytic reformer, CVR's completion of CVR's future non-acquisition capital spending plans over the medium term are modest enough to allow for free cash flow generation under reasonably anticipated sector conditions with the potential for debt reduction. The company states that it may reduce debt by $25 million or more during 2010. CVR's EBIT / Throughput Barrels, EBIT / Interest Expense, and Retained Cash Flow / Debt metrics have been comparatively strong during the down-cycle, mapping to Ba and investment grade levels, and its Debt / Complexity Barrels has fallen and crossed into investment grade territory. Though 2009 earnings included a substantial FIFO inventory gain, 2008 earnings carried a larger FIFO loss. CVR's gathering system captures crude cost advantages and its regional location and upgrading capacity add further margin potential to its throughput. CVR reports that its Nelson Complexity Index increased to 12.2 by the end of 2009 from 9.5 in 2005 and that it believes its Nelson Complexity Index will increase to 12.9 by mid-2010. CVR yields a comparatively high 92% proportion of total output as high value gasoline and diesel. Its new continuous catalytic reformer, coking capacity, expanded cracking capacity and completion of low sulfur gasoline and ultra-low sulfur diesel capacity have also reduced its proportion of low premium gasoline and boosted the proportion of premium gasoline. The last rating action on CVR was on December 5, 2007, when Moody's upgraded its Corporate Family Rating from Caa1 to B2, senior first secured debt ratings from Caa1 (LGD 3; 31%) to B2 (LGD 3; 31%), Probability of Default rating from Caa2 to B3, and assigned a stable outlook. CVR Energy, Inc., is headquartered in Sugar Land, Texas. It operates a 115,000 barrel-per-day crude oil refinery in Coffeyville, located in southeastern Kansas, a fertilizer production business, and a crude oil gathering system spanning Kansas, Oklahoma, western Missouri, and eastern Colorado. CVR produces a very low level of premium gasoline (to be addressed with a new) and it carries the higher unit costs of comparatively low energy and heat efficiency. DELPHI CORP: Automotive Posts $3 Million Loss for 2009 ------------------------------------------------------ Delphi Automotive LLP said it incurred loss of $3 million since August 19, 2009, when the new company was incorporated, The Detroit Free Press reports. The loss was because Delphi Automotive "narrowed its scope of attention and has very solid operations and good products in the areas that it's going after," Jim Gillette, director of financial services at CSM Worldwide was quoted by The Detroit Free Press as saying. The report notes that Delphi's debt was cut 83% to $396 million between the end of 2008 and 2009. Delphi Automotive is a private company that acquired, through various subsidiaries and affiliates, substantially all of the global core business of Delphi Corp., now known as DPH Holdings Corp. and its debtor affiliates. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi had approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELPHI CORP: CFO Sheehan to Resign Effective March 30 ----------------------------------------------------- Delphi Automotive LLP disclosed in mid-February 2010 additional appointments to the company's Board of Managers. "These new board members bring outstanding additional industry experience to the already-considerable talent on the board, said Delphi Chairman John A. (Jack) Krol. "We look forward to their perspective and insight on the opportunities facing Delphi, and to making the company even stronger than it already is." The new members are: Nicholas M. Donofrio, 64, retired executive vice president, Innovation & Technology at International Business Machines Corporation. Mr. Donofrio began his career at IBM in 1964, and worked at the company for more than 40 years in various positions of increasing responsibility, including division director; divisional vice president for advanced workstations; general manager, Large Scale Computing Division; and senior vice president, Technology & Manufacturing. Mr. Donofrio also serves on the boards of the Bank of New York Mellon Corporation, Advanced Micro Devices, and Liberty Mutual Holding Company, Inc. He earned a B.S. degree in electrical engineering from Rensselaer Polytechnic Institute and holds a master's degree in electrical engineering from Syracuse University. Mark P. Frissora, 54, chairman and CEO of Hertz Global Holdings, Inc. Prior to joining Hertz in 2006, Mr. Frissora served as chairman and CEO of Tenneco, Inc. from 2000. Mr. Frissora previously served for five years as a vice president at Aeroquip-Vickers Corporation. From 1987 to 1991, he held various management positions at Philips N.V., including Director of Marketing and Director of Sales. Prior to Philips, he worked for ten years at General Electric Co. in brand management, marketing and sales. He also is a member of the board of directors of Walgreens. Mr. Frissora holds a B.A. degree from The Ohio State University, with studies focused on business and communications. He has completed advanced studies at both the University of Pennsylvania's Wharton School and the Thunderbird International School of Management. Thomas W. Sidlik, 60, retired from the DaimlerChrysler AG Board of Management in Germany in 2007. He served as the chairman of Eastern Michigan University from 2007 to 2009. Previously, he served as chairman and CEO of Chrysler Financial Corporation, chairman of the Michigan Minority Business Development Council, and vice-chairman of the National Minority Supplier Development Council in New York. He currently serves on the boards of Eastern Michigan University and the Detroit Institute of Arts. He received a B.S. in finance and banking with honors from New York University and an MBA from the University of Chicago. As noted in the company's December 2009 release, the Board is chaired by Jack Krol, former chairman of DuPont and lead director for Tyco International Ltd. Previously named members of the board include Gary L. Cowger, Rajiv L. Gupta, J. Randall MacDonald, Sean O. Mahoney, Michael McNamara and Lawrence A. Zimmerman. In related news, Delphi Automotive related on February 25, 2010, that its chief financial officer John Sheehan plans to leave the company effective March 31 to pursue other opportunities. "John has been an outstanding leader in the transformation of Delphi," said CEO and President Rodney O'Neal. "Through an extremely difficult period for our company and our industry, John has been a tenacious and steadfast advocate for us with the financial community, assuring that we had adequate funding to operate and meet our commitments to our customers. His leadership of our restructuring process has earned him the respect of our employees, customers and suppliers. While we will miss his guidance, work ethic, and leadership of the financial team at Delphi, we wish him the very best in new endeavors." Mr. Sheehan, 49, joined Delphi in 2002 as chief accounting officer and controller. In March 2005, he was named acting chief financial officer overseeing Delphi's treasury, tax, mergers and acquisitions, internal and external reporting, internal control, budgeting, forecasting and financial planning and analysis. He was named vice president and chief restructuring officer, chief accounting officer and controller in October 2005 and became CFO in October 2008. Delphi has initiated an outside search for Mr. Sheehan's successor. Upon Mr. Sheehan's departure, Keith Stipp, current treasurer of the company, will serve as acting CFO until the position is filled. About Delphi Automotive Delphi Automotive is a leading global supplier of electronics and other technology for autos, commercial and other vehicles. Delphi Automotive was created in October 2009 when a group of private investors purchased assets from the former Delphi Corporation. Delphi has more than 100,000 employees at 270 locations and 24 engineering centers in 32 countries. More information regarding the company can be found at http://www.delphi.com/ About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi had approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELPHI CORP: DSRA Stopped From Pursuing Suit vs. GM --------------------------------------------------- Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York ordered the Delphi Salaried Retirees Association to immediately cease and desist from any further prosecution of its action in the United States District Court for the Eastern District of Michigan against General Motors Company or New GM or any similar lawsuit in any forum against New GM. The DSRA will immediately dismiss New GM from the Michigan Civil Action, without prejudice to its ability to seek future relief in the Bankruptcy Court from the injunction set forth in the Debtors' Modified First Amended Joint Plan of Reorganization and its related confirmation order dated July 30, 2009, upon a showing to the Bankruptcy Court of new facts and circumstances that would demonstrate that New GM's conduct is not subject to the release and injunction provisions of the Modified Plan and the July 30 Confirmation Order, Judge Drain ruled. Any further prosecution of the Michigan Civil Action against New GM, or prosecution of any similar lawsuit in any forum against New GM, without the DSRA first proceeding in the Bankruptcy Court will constitute contempt of the Bankruptcy Court, Judge Drain held. DSRA Objects, New GM Talks Back Shortly before the Bankruptcy Court entered its ruling, the DSRA filed a response to New GM's Plan Enforcement Motion. DSRA, through its counsel, Howard S. Sher, Esq., at Jacob & Weingarten, P.C., in Troy, Michigan, asserted that New GM's decision to initiate the collateral proceedings "is patent forum shopping, designed to select a forum [New GM] believes will be more sympathetic to [New GM's] position, while at the same time forcing the DSRA to litigate issues in multiple forums in an attempt to drain the DSRA's financial resources." The DSRA insisted that its allegations in the Michigan Civil Action (i) concern actions completely unrelated to the Modified Plan and taken after the effective date of the releases granted to New GM by the Bankruptcy Court; and (ii) implicate a cause of action outside the scope of the releases because its claims involve allegations of willful misconduct. In effect, the DSRA asked the Bankruptcy Court to either abstain from ruling on the Plan Enforcement Motion in favor of the Michigan District Court or, deny the Plan Enforcement Motion. "The DSRA is wrong," New GM said in light of the DSRA's response. New GM's counsel, Lisa G. Laukitis, Esq., at Jones Day, in New York, clarified that New GM's commitments to assume or grant pension "top-up" commitments to the United Auto Workers, United Steelworkers and International Union of Electronic, Electrical, Salaried, Machine and Furniture Workers were all made before the Effective Date of the Modified Plan, October 6, 2009. In fact, according to its own pleadings, the DSRA's claims of "government action" and "constitutional discrimination" arose in July 2009 when New GM assumed the UAW pension top-up obligation as part of the Modified Plan and early September 2009 when New GM committed to top up the USW and IUE-CWA pensions, before the Effective Date, she pointed out. The DSRA's emphasis on the Effective Date is also a red herring because New GM's top-up decisions fall within the releases in the Modified Plan, Ms. Laukitis contended. For one, the Modified Plan exculpates New GM for any acts taken in furtherance of the Master Disposition Agreement and the Modified Plan or consistent with the various settlement agreements reached between New GM and the Unions. More importantly, the exculpation encompasses acts taking place before and after the Effective Date, she pointed out. New GM's actions in respect of these pension top-up obligations were undertaken to implement the Modified Plan and are consistent with the Union Settlement Agreements approved by the Bankruptcy Court, she added. New GM also opposed the DSRA's request that the Bankruptcy Court abstain from deciding the Plan Enforcement Motion. New GM believes that the Bankruptcy Court is the most appropriate forum to interpret and enforce its own orders and is most familiar with the complex union and employee negotiations and the sale and financing transactions that were required during the Debtors' Chapter 11 cases. New GM thus asked the Bankruptcy Court to decide on its Plan Enforcement Motion. Upon review, Judge Drain overruled the DSRA's response to New GM's Plan Enforcement Motion. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi had approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELPHI CORP: Professionals Seek $371 Million in Final Fees ---------------------------------------------------------- Pursuant to Sections 330 and 331 of the Bankruptcy Code, 41 professionals retained in the Debtors' Chapter 11 cases filed with the Court their final fee applications, seeking payment of fees aggregating totaling $371,114,977, and reimbursement of expenses, amounting to $22,512,113. The Delphi Fee Committee notes that the final fee application process covers the period through January 25, 2008. The specific final fees and expenses requested are: A. Professionals of the Debtors Firm Period Fees Expenses ---- ------ ---------- --------- Skadden, Arps, Slate, 10/08/05- $90,556,038 $5,756,849 Meagher & Flom LLP 01/25/08 KMPG LLP 10/08/05- $52,000,509 $4,774,859 10/06/09 FTI Consulting, Inc. 10/08/05- $44,018,853 $3,645,695 01/25/08 PricewaterhouseCoopers 02/01/06- $36,025,791 $3,233,384 LLP 01/25/08 Rothschild Inc. 10/08/05- $27,895,161 $857,653 01/25/08 Ernst & Young LLP 10/08/05 $27,549,300 $584,199 01/28/08 Deloitte & Touche LLP 10/08/05- $13,377,565 $4,660 01/25/08 Shearman & Sterling LLP 10/08/05- $6,020,871 $283,744 01/25/08 Mayer Brown LLP 02/01/06- $3,422,323 $91,912 01/25/08 Legal Cost Control. Inc. 10/01/06- $2,708,812 $0 01/25/08 Covington & Burling LLP 10/08/05- $1,883,390 $60,324 01/25/08 Togut, Segal & Segal LLP 10/01/07- $1,671,124 $198,683 01/25/08 Jones Lang Lasalle 10/01/07- $1,259,205 $61,316 Americas, Inc. 12/31/07 Ivins, Phillips, & 10/08/05- $1,201,943 $19,669 Barker Chartered 01/25/08 Howard & Howard 10/08/05- $1,093,130 $105,865 Attorneys, P.C. 01/25/08 Wilmer Cutler Pickering 10/08/05- $999,898 $199,335 Hale and Dorr LLP 01/25/08 Groom Law Group, 10/08/05- $745,728 $39,319 Chartered 01/25/08 Thompson Hine LLP 10/08/05- $716,338 $82,203 01/25/08 DLA Piper LLP 05/01/06- $308,947 $12,092 08/15/07 Butzel Long 10/01/07- $294,581 $4,613 01/25/08 Jaeckle Fleischmann & 10/01/07- $280,150 $48,435 Mugel, LLP 01/25/08 Banner & Witcoff, Ltd. 10/08/05- $253,346 $11,997 08/15/07 Cadwalader, Wickersham 10/10/05- $249,351 $14,877 & Taft LLP 08/15/07 Dykema Gossett PLLC 10/01/07- $212,416 $24,438 01/25/08 W.Y. Campbell & Company 09/01/06- $190,322 $5,015 01/25/08 Quinn Emanuel Urquhart 10/08/05- $153,390 $5,803 Oliver & Hedges, LLP 08/15/07 Cantor Colburn LLP 10/01/07- $119,740 $28,417 01/25/08 O'Melveny & Myers LLP 10/01/07- $7,988 $1,007 01/25/08 Blake, Cassels & 10/01/07- C$2,539 C$1,173 Graydon LLP 01/25/08 B. Professionals of the Official Committee of Unsecured Creditors Latham & Watkins LLP 10/01/05- $19,817,103 $1,113,098 01/25/08 Mesirow Financial 10/19/05- $9,803,908 $157,826 Consulting, LLC 01/25/08 Jeffries & Company, Inc. 10/08/05- $4,759,561 $144,672 01/25/08 Steven Hall & Partners, 11/07/05- $1,648,071 $0 LLC 01/25/08 Warner Stevens, L.L.P. 11/10/05- $1,406,439 $74,322 01/25/08 Buck Consultants, LLC 10/01/07- $96,648 $0 09/30/08 C. Professionals of the Official Committee of Equity Security Holders Fried, Frank, Harris, 05/08/06- $11,066,482 $509,892 Shriver & Jacobson LLP 01/25/08 Houlihan Lokey Howard & 07/31/06- $3,121,774 $109,900 Zukin Capital 01/25/08 Gregory P. Joseph Law 10/01/07- $148,725 $5,490 Offices LLC 01/25/08 D. Professionals of Senior Noteholders Goodwin Procter LLP 09/17/07- $3,412,444 $224,661 01/17/08 Klestadt & Winters, LLP 09/17/07- $3,205 $66 01/17/08 Maryann Keller & 09/17/07- $329,906 $0 Associates 01/17/08 Stutman, Treister & 06/04/08- $284,501 $15,823 Glatt P.C. 09/25/08 Davidson Kempner Capital Management LLC; Elliott Associates, L.P.; Nomura Corporate Research & Asset Management, Inc.; Northeast Investors Trust; SPCP Group, LLC; Whitebox Advisors, LLC, and CR Intrinsic Investors, LLC, are holders of senior notes issued by Delphi Corporation. These professionals seek payment of hold back fees that amount to: Professional Holdback Fees ------------ ------------- Latham Wilkins $421,184 Houlihan Lokey 133,225 Skadden Arps 155,721 FTI Consulting 736,503 Mesirow Financial 157,826 Cantor Colburn 22,959 Gregory P. Joseph 29,745 Blake Cassels C$507 Moreover, Buck Consultants seeks final approval of previously paid fees made by the Debtors for $151,426 for the period from January 23, 2006, to September 30, 2008. Warner Stevens, L.L.P., also seeks payment of $12,500 for preparation of its final fee application. Jones Lang seeks final allowance of additional fees of $36,095 for services performed and $144,701 for unpaid fees. Certain Professional Fees are not Warranted, U.S. Trustee Asserts Despite the review of the asserted professional fees and expenses by the Debtors' Audit Committee and the Delphi Joint Fee Review Committee, negotiated reductions and voluntary write-offs totaled only 4%, Diana G. Adams, U.S. Trustee for Region 2, complains. While the Debtors' Chapter 11 cases were complicated, they were not a success, the U.S. Trustee maintains. She notes that the Debtors were unable to consummate their original plan of reorganization, which was confirmed on January 25, 2008. She further points out that the Debtors' Modified First Amended Joint Plan of Reorganization, which was confirmed on July 30, 2009, became effective on October 9, 2009 -- only after the U.S. Department of the Treasury authorized General Motors Corporation or Old GM to use government money to partially fund the Modified Plan. Upon review, the U.S. Trustee thus asks the Court to disallow the requested fees of certain professionals, totaling $16,092,345, on these grounds: * The Court should reduce Skadden Arps' fees by $436,530 because the firm billed the Debtors for clerical time incurred by paraprofessionals, which is not compensable, and charged excessive fees for the work of unadmitted personnel. * Rothschild did not meet its burden of proving that it is entitled to a $15 million Completion Fee. The Court should disallow the Completion Fee. * Wilmer Hale seeks reimbursement of fees for $174,049 incurred by PwC, which assisted the firm in its representation of the Audit Committee. Professionals retained under Section 327 of the Bankruptcy Code may not retain other professionals and claim the fees as expenses in applications for compensation, the U.S. Trustee contends. The Court should thus deduct that amount from either Wilmer Hale's or PwC's final fee award. In addition, Wilmer Hale did not disclose the arrangement with PwC in the affidavits under Rule 2014 of the Federal Rules of Bankruptcy Procedure that it filed with the Court. The Court should thus order Wilmer Hale to disgorge $179,398, which represents total fees incurred and paid during the third interim fee period. * The Court should reduce the final fee award to Latham & Watkins for $132,330 because the firm charged excessive fees for the work of unadmitted personnel. * The Court should disallow fees and expenses, totaling $151,836, billed by Fried Frank for time incurred by summer associates, which is overhead and not compensable. The U.S. Trustee further asserts that Fried Frank charged excessive fees for unadmitted personnel. * Warner Stevens seeks the award of future fees for $12,000. The Court should deny the award of future fees unless Warner Stevens settles a supplemental fee order along with contemporaneous time records documenting the request. * Howard & Howard seeks the award of future fees and the reimbursement of future expenses for $6,200. The Court should deny this request unless Howard & Howard settles a supplemental fee order along with contemporaneous time and expense records documenting the request. The U.S. Trustee says she does not object to the final award of fees and reimbursement of expenses of the other professionals, a list of which is available for free at: http://bankrupt.com/misc/Delphi_UndisptdFinalFees.pdf Professionals Respond to U.S. Trustee's Contentions John Wm. Butler, Jr., Esq., of Skadden Arps asserts that his firm already made voluntary reductions with respect to fees, charges, and disbursements, totaling $10,117,859, or about 9.5%. "These voluntary accommodations of about 9.5% exceeds the 4% aggregate voluntary accommodation calculated by the U.S. Trustee." In response to the U.S. Trustee's objections, Mr. Butler explains that Skadden Arps' policy is not to charge clients for firm administration matters as set forth in the firm's Final Fee Application. However, as contemplated under Section 330 and customary practice in the Southern District of New York, Skadden Arps is permitted to recover reasonable paraprofessional fees, he says. In this light, paraprofessionals' review of the case docket and several correspondences; and tracking of motions and other pleadings to assure that all deadlines were timely met are not overhead charges but specific tasks required for the smooth and continuous representation of debtors in very large and complex Chapter 11 cases, Mr. Butler insists. To address the U.S. Trustee's concerns, Warner Stevens filed with the Court a copy of contemporaneous time records showing that it incurred 41.6 hours of professional time or $12,645 in the preparation of the Final Fee Application. Warner Stevens adds that it has incurred $485 in expenses related to the service of its Final Fee Application. Despite that incurrence, Warner Stevens seeks only $12,500 for the preparation of the Final Fee Application. A copy of the supplemental time records is available for free at: http://bankrupt.com/misc/Delphi_WarnerSuppTimeRecords.pdf Latham & Watkins, for its part, clarifies that it did not charge hourly rates for the unadmitted personnel that exceed the hourly rates for attorneys who had been admitted to the bar. Latham & Watkins further contends that the U.S. Trustee failed to account for an increase in the firm's billing rates for attorneys and paralegals that occurred on January 1, 2008. Thus, Latham & Watkins asks the Court to overrule the U.S. Trustee's objections to its requested fees. William R. Shaw, managing director at Rothschild, explains that the $15 million Completion Fee was triggered by these two events in the Debtors' Chapter 11 cases, each of which constituted a "Transaction" under the firm's engagement letter: (1) The effectiveness of an Amended and Restated Global Settlement Agreement and Amended Master Restructuring Agreement on September 29, 2008, which immediately transferred an unfunded net pension liability of about $2.1 billion from the Debtors to Old GM and committed Old GM to provide substantial additional support to the Debtors with respect to labor costs and other post -employment benefits commitments, which the Debtors valued at about $10.6 billion; and (2) The effectiveness of the Modified Plan, and Delphi Holdings LLP's consummation of the acquisition of most of the Debtors' assets and operations. In a separate filing, Michelle A. Goldis, Esq., at Wilmer Hale, argues that her firm's arrangement with PwC was properly disclosed and authorized by the Court. She reminds that Court that the Debtors noted in the PwC Employment Application that PwC would perform various accounting services for the Debtors and would do work for Wilmer Hale in connection with Wilmer Hale's work for the Audit Committee. She relates that Wilmer Hale then submitted an interim fee statement on September 26, 2009, to the Debtors, disclosing that the requested fees to be reimbursed included a $174,094 for services rendered and costs incurred by PwC during the period from February 1, 2006, to May 31, 2006. No objections were filed and the Debtors paid the requested amount, she relates. Fee Committee Files Recommendation David M. Sherbin, Esq., chairman of the Fee Review Committee, notes that the Final Fee Applications of certain professionals sought payment of fees and expenses, exceeding the amounts previously awarded by the Court for the first six interim fee periods and the amounts submitted to the Debtors for the seventh interim fee period. In this light, the Fee Review Committee contacted each professional to reconcile the discrepancies, which resulted to a reduction of fees, aggregating $215,000. A summary of the Reconciled Fee Amounts prepared by the Fee Committee is available for free at: http://bankrupt.com/misc/Delphi_ReconciledFees.pdf The Fee Review Committee thus recommends to the Court the amounts sought in the Final Fee Applications, as reconciled, for approval. The Fee Review Committee, however, points out that Buck Consultants, LLC's final fees for $248,074 is incorrect. The Fee Review Committee explains that the $248,074 amount, includes $94,568 of fees incurred after January 25, 2008, which are not part of the final fee application process. Thus, Buck should only be seeking final approval of $153,506 for fees and $0 for expenses, the Fee Review Committee maintains. Reorganized Debtors Defend Rothschild and Support Approval of Final Fees In light of the U.S. Trustee objections to Rothschild's Completion Fee, DPH Holdings Corp. President John Brooks comments that the U.S. Trustee does not appreciate the basis for the payment of the Completion Fee to Rothschild. In accordance with Rothschild's engagement letter, Delphi Corporation paid Rothschild $7.5 million in January 2009 and $7.5 million in connection with the closing of the transactions on the Plan Effective Date in October 2009. Mr. Brooks emphasizes that Rothschild has agreed to certain voluntary accommodations with respect to its overall fee: * Rothschild agreed to reduce its mergers and acquisitions or "M&A" fee with respect to the sale of the Debtors' steering business by $500,000. Rothschild earned a $5 million Steering M&A Fee which, after applying the 50% credit against the Completion Fee as required under the engagement letter, entitled the firm to receive payment of $2.5 million. As an accommodation, Rothschild agreed to further reduce that amount to $2 million and to defer payment until after the Effective Date. * Rothschild waived its right to receive a $2 million New Capital Fee in connection with in the DIP Accommodation Agreement. Rothschild was entitled to a New Capital Fee capped at $2 million in connection with any extension, modification, or refinancing of debtor-in-possession financing. Although DPH Holdings believes that Rothschild earned the $2 million New Capital Fee in connection with the DIP Accommodation Agreement, the firm waived the New Capital Fee as an additional accommodation. Mr. Brooks adds that DPH Holdings will pay the balance due and owing to Rothschild of $2,190,322, consisting of a holdback of $190,322 with respect to the seventh interim period and the $2 million M&A fee. DPH Holdings will also pay the unpaid fee amounts as reconciled by the Fee Review Committee, he adds. These amounts have been fully provided for in the professional fee escrow established in connection with the closing of the transactions on the Plan Effective Date, Mr. Brooks tells the Court. Dickinson Wright Stipulates with U.S. Trustee on Final Fees Dickinson Wright PLLC firm filed its sixth interim and final application for the period from April 26, 2006, to August 15, 2007. Even though Dickinson Wright sought final approval and payment of its costs and fees, the firm withdrew the Final Application and refiled the fee application as its Sixth Interim Application. The Debtors included Dickinson Wright in their Notice of Hearing for the final fee applications. Kristi A. Katsma, Esq., at Dickinson Wright PLLC, in Detroit, Michigan, says it was agreed between the Debtors and Dickinson Wright that the Debtors had made an error on their Notice of Hearing, and that the final amount of fees and costs for Dickinson Wright should be $455,642 and $21,976 as previously approved pursuant to the interim fee application process. Upon learning of Dickinson Wright's failure to file a current final fee application, the Debtors and U.S. Trustee agreed to allow the firm's Sixth Interim Application as a final application. Thus, Dickinson Wright asks the Court to allow payment of its prior fee applications for $445,642 and reimbursement of expenses of $21,976. Ms. Katsma notes that Dickinson Wright, which had not been involved in the Debtors' bankruptcy case after August 15, 2007, believes that its failure to refile a final fee application constitutes excusable neglect. There is no prejudice to the Debtors' estate as Dickinson Wright is not seeking payment of additional fees and costs or allowance of any fees or costs which were not already approved by prior Court orders, she maintains. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi had approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELTA AIR: FS Technicians Reject Union Representation ----------------------------------------------------- Delta Air Lines, Inc., received on February 25, 2010, a notification from the National Mediation Board that a majority of eligible flight simulator technicians rejected union representation by the International Association of Machinists. "Our flight simulator technicians have made a decisive choice not to have IAM representation," said Mike Campbell, Delta's executive vice president of Human Resources and Labor Relations, in an official statement issued by the Company. "We take our responsibility to do right by our people very seriously and we'll continue to do everything we can to make Delta a great place to work," Mr. Campbell said. "It's now time for the IAM to move forward to allow our employees in other workgroups the same opportunity to express their individual choice about union representation," Mr. Campbell added. Ninety-one flight simulator technicians were eligible to vote in this election. Of those, only 40 voted in favor of IAM representation, according to the statement. AFA Blocks Delta's Crew Integration Efforts The Association of Flight Attendants has lobbed a grievance asserting that Delta must stop combining Delta-Northwest flight crews because its contract says flights flown by Northwest pilots must be worked by Northwest flight attendants, reported The Atlanta-Journal Constitution. The dispute is hinged on labor representation issues that remain unresolved after the airlines merged in October 2008. Delta's non-union flight attendants have not voted on representation. "We understand that since Delta management has never had to adhere to a flight attendant contract before, they are used to imposing various work rules upon the flight attendants with no recourse, so of course they would be intimidated . . . and get defensive," Northwest AFA president Janette Rook related in an e- mail to the AJC. "Since Delta has gotten rid of most of the pre- merger NWA management that understood our contract, there have been a number of critical contractual violations," Ms. Rook added. In a memo to flight attendants, Delta Senior Vice President of in-flight service Joanne Smith said she "strongly disagree[s] with the AFA's position for several reasons, among them that all our operations are now Delta operations and all pilots are Delta pilots operating under a single Delta seniority list." The integration "will improve work-life quality for Northwest attendants," she added. Delta and Northwest pilots have already combined seniority lists. Delta wants to cross-staff flight attendant crews starting May 1, 2010, according to the report. About Delta Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to 367 destinations in 66 countries on six continents. Delta employs more than 70,000 employees worldwide and operates a mainline fleet of nearly 800 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry's trans-Atlantic joint venture with Air France KLM. Including its worldwide alliance partners, Delta offers customers more than 16,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline's service includes the SkyMiles frequent flier program, the world's largest airline loyalty program; the BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta became the world's largest airline following merger with Northwest Airlines in 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. At December 31, 2009, Delta had total assets of $43,539,000,000 against total current liabilities of $9,797,000,000 and total noncurrent liabilities of $33,497,000,000, resulting in stockholders' equity of $245,000,000. At end-2008, Delta had stockholders' equity of $874,000,000. The December 31, 2009 balance sheet showed strained liquidity: Delta had total current assets of $7,741,000,000 against total current liabilities of $9,797,000,000. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Negative/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DELTA AIR: Inks LaGuardia & Reagan Pact With US Airways ------------------------------------------------------- Delta Air Lines (NYSE: DAL) and US Airways (NYSE: LCC) have entered into an agreement to transfer to four airlines 12 percent of the takeoff and landing slots involved in a previously announced transaction between the carriers at New York's LaGuardia and Washington's Reagan National airports. The transfers are contingent upon Federal Aviation Administration (FAA) approval and the subsequent closing of the originally proposed Delta-US Airways transaction. In comments filed with the U.S. government, Delta said it has concluded agreements with AirTran Airways (NYSE: AAI), Spirit Airlines and WestJet (TSE: WJA) to transfer up to five pairs each of takeoff and landing slots at LaGuardia. In a separate transaction, US Airways has agreed to transfer five pairs of Reagan National slots to JetBlue Airways (Nasdaq: JBLU). AirTran, Spirit, WestJet and JetBlue are each considered limited incumbents or new entrant airlines by the FAA at these airports. In the filings, the four airlines urged the government to approve the proposed Delta-US Airways slot transaction. Under Delta and US Airways' originally announced proposal, US Airways would transfer 125 operating slot pairs to Delta at LaGuardia and Delta would transfer 42 operating slot pairs to US Airways at Reagan National. US Airways also would gain access to the key international destinations of Sao Paulo and Tokyo-Narita. With the new six-way agreement, Delta would operate an additional 110 slot pairs at LaGuardia; AirTran, Spirit and WestJet would obtain five slot pairs each at LaGuardia from Delta; US Airways would acquire 37 slot pairs at Reagan National; JetBlue would gain five slot pairs from US Airways at Reagan National; and US Airways would gain access to Sao Paulo and Tokyo. As previously outlined by Delta and US Airways, the airlines' proposed transaction would add flights to a number of cities from both the New York and Washington, D.C. markets. In New York, Delta will add or preserve service to dozens of small- and medium-sized communities while adding service in a number of markets not currently served by US Airways. The airline would also begin a multimillion dollar construction program at LaGuardia to connect the existing Delta and US Airways terminals. Delta has estimated that the transaction will generate as many as 7,000 new jobs in the New York City area driven by the construction of new facilities and the addition of service. In Washington, D.C., US Airways will add 15 new, daily destinations to its schedule, including eight routes that currently have no daily nonstop service to Reagan National on any airline. US Airways plans to fly to all of the destinations that Delta decides to discontinue as a result of this transaction. The airline also will significantly expand its use of larger dual-class jets by nearly 50 percent at Reagan National. Delta and US Airways on Aug. 12, 2009, announced their plans to transfer slots at LaGuardia and Reagan National airports. On Feb. 9, 2010, the FAA granted conditional approval of the transaction with a requirement that slots be divested at both airports. As part of their filings, Delta and US Airways also submitted comments challenging the legal basis for the divestiture requirement. Delta and US Airways confirmed in the filings that they do not intend to go forward with the transaction on the conditions stated in the FAA's Feb. 9 notice if the original transaction, as modified by today's agreement, is not approved. About US Airways US Airways, along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. The airline employs more than 31,000 aviation professionals worldwide and is a member of the Star Alliance network, which offers its customers more than 19,700 daily flights to 1,077 airports in 175 countries. Together with its US Airways Express partners, the airline serves approximately 80 million passengers each year and operates hubs in Charlotte, N.C., Philadelphia and Phoenix, and a focus city at Ronald Reagan Washington National Airport. And for the eleventh consecutive year, the airline received a Diamond Award for maintenance training excellence from the Federal Aviation Administration for its Charlotte hub line maintenance facility. For more company information, visit http://www.usairways.com About Delta Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to 367 destinations in 66 countries on six continents. Delta employs more than 70,000 employees worldwide and operates a mainline fleet of nearly 800 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry's trans-Atlantic joint venture with Air France KLM. Including its worldwide alliance partners, Delta offers customers more than 16,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline's service includes the SkyMiles frequent flier program, the world's largest airline loyalty program; the BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta became the world's largest airline following merger with Northwest Airlines in 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. At December 31, 2009, Delta had total assets of $43,539,000,000 against total current liabilities of $9,797,000,000 and total noncurrent liabilities of $33,497,000,000, resulting in stockholders' equity of $245,000,000. At end-2008, Delta had stockholders' equity of $874,000,000. The December 31, 2009 balance sheet showed strained liquidity: Delta had total current assets of $7,741,000,000 against total current liabilities of $9,797,000,000. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Negative/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DELTA AIR: Reports February 2010 Traffic Results ------------------------------------------------ Delta Air Lines (NYSE: DAL) reported traffic results for February 2010. System traffic in February 2010 decreased 2.6 percent compared to February 2009 on a 6.1 percent decrease in capacity. Load factor increased 2.8 points to 77.1 percent. Domestic traffic decreased 3.3 percent year over year on a 4.6 percent decrease in capacity. Domestic load factor increased 1.0 point to 78.8 percent. International traffic decreased 1.5 percent year over year on an 8.5 percent decrease in capacity, and load factor increased 5.3 points to 74.3 percent. Delta Air Lines Monthly Traffic Results February 2010 February 2009 Change ------------- ------------- ------ RPMs (000): Domestic 7,937,949 8,208,678 (3.3%) Mainline 6,206,895 6,446,654 (3.7%) Regional 1,731,054 1,762,025 (1.8%) International 4,556,685 4,625,521 (1.5%) Latin America 1,058,394 1,017,000 4.1% Mainline 1,036,475 1,000,404 3.6% Regional 21,919 16,596 32.1% Atlantic 1,995,819 2,146,056 (7.0%) Pacific 1,502,472 1,462,465 2.7% System 12,494,634 12,834,199 (2.6%) ASMs (000): Domestic 10,071,021 10,555,228 (4.6%) Mainline 7,767,826 8,091,515 (4.0%) Regional 2,303,195 2,463,713 (6.5%) International 6,136,380 6,707,255 (8.5%) Latin America 1,388,305 1,369,435 1.4% Mainline 1,358,038 1,343,428 1.1% Regional 30,267 26,007 16.4% Atlantic 2,913,042 3,513,162 (17.1%) Pacific 1,835,033 1,824,658 0.6% System 16,207,401 17,262,483 (6.1%) Load Factor Domestic 78.8% 77.8% 1.0 pts Mainline 79.9% 79.7% 0.2 pts Regional 75.2% 71.5% 3.7 pts International 74.3% 69.0% 5.3 pts Latin America 76.2% 74.3% 1.9 pts Mainline 76.3% 74.5% 1.8 pts Regional 72.4% 63.8% 8.6 pts Atlantic 68.5% 61.1% 7.4 pts Pacific 81.9% 80.2% 1.7 pts System 77.1% 74.3% 2.8 pts Passengers Boarded 10,874,769 11,400,286 (4.6%) Mainline Completion Factor 94.7% 99.2% (4.5) pts Cargo Ton Miles (000): Passenger Cargo 166,531 115,896 43.7% Freighter Cargo 0 39,686 (100.0%) System 166,531 155,582 7.0% Delta Air Lines Year to Date Traffic Results February 2010 February 2009 Change ------------- ------------- ------ RPMs (000): Domestic 16,388,172 16,895,251 (3.0%) Mainline 12,832,333 13,327,346 (3.7%) Regional 3,555,839 3,567,904 (0.3%) International 9,912,269 10,465,922 (5.3%) Latin America 2,211,835 2,178,123 1.5% Mainline 2,172,472 2,139,430 1.5% Regional 39,363 38,694 1.7% Atlantic 4,502,997 5,024,043 (10.4%) Pacific 3,197,437 3,263,756 (2.0%) System 26,300,441 27,361,172 (3.9%) ASMs (000): Domestic 21,216,319 21,919,675 (3.2%) Mainline 16,344,753 16,834,433 (2.9%) Regional 4,871,565 5,085,242 (4.2%) International 13,003,280 14,424,086 (9.9%) Latin America 2,845,838 2,886,107 (1.4%) Mainline 2,790,438 2,826,240 (1.3%) Regional 55,401 59,867 (7.5%) Atlantic 6,300,288 7,553,727 (16.6%) Pacific 3,857,153 3,984,252 (3.2%) System 34,219,599 36,343,761 (5.8%) Load Factor Domestic 77.2% 77.1% 0.1 pts Mainline 78.5% 79.2% (0.7) pts Regional 73.0% 70.2% 2.8 pts International 76.2% 72.6% 3.6 pts Latin America 77.7% 75.5% 2.2 pts Mainline 77.9% 75.7% 2.2 pts Regional 71.1% 64.6% 6.5 pts Atlantic 71.5% 66.5% 5.0 pts Pacific 82.9% 81.9% 1.0 pts System 76.9% 75.3% 1.6 pts Passengers Boarded 22,502,920 23,569,888 (4.5%) Cargo Ton Miles (000): Passenger Cargo 319,826 230,140 39.0% Freighter Cargo 0 75,281 (100.0%) System 319,826 305,421 4.7% About Delta Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to 367 destinations in 66 countries on six continents. Delta employs more than 70,000 employees worldwide and operates a mainline fleet of nearly 800 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry's trans-Atlantic joint venture with Air France KLM. Including its worldwide alliance partners, Delta offers customers more than 16,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline's service includes the SkyMiles frequent flier program, the world's largest airline loyalty program; the BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta became the world's largest airline following merger with Northwest Airlines in 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. At December 31, 2009, Delta had total assets of $43,539,000,000 against total current liabilities of $9,797,000,000 and total noncurrent liabilities of $33,497,000,000, resulting in stockholders' equity of $245,000,000. At end-2008, Delta had stockholders' equity of $874,000,000. The December 31, 2009 balance sheet showed strained liquidity: Delta had total current assets of $7,741,000,000 against total current liabilities of $9,797,000,000. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Negative/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DELTA AIR: Techops to Expand Services for Sun Country ----------------------------------------------------- The maintenance division of Delta Air Lines (NYSE: DAL), Delta TechOps, recently expanded its relationship with Sun Country Airlines of St. Paul, Minn., with agreements to provide auxiliary power unit (APU) and component maintenance services. "As the maintenance and repair organization supporting the world's premier global airline, Delta TechOps has a highly skilled workforce and tremendous resources at our disposal," said Tony Charaf, president of Delta TechOps. "The men and women of Delta TechOps deliver a high degree of efficiency, flexibility and service to valued customers like Sun Country." As part of one agreement, Delta TechOps will provide exclusive maintenance on the GTCP 131-9B engine APUs for Sun Country's fleet of nine 737 NG aircraft for five years. A second agreement extends an existing contract through 2018 for Delta TechOps to supply inventory support and service?including integrated component repair and exchanges?for Sun Country's entire 737 NG fleet. Delta TechOps has been providing maintenance services to Sun Country's aircraft since 2001. "During our nine-year partnership with Delta TechOps, they've provided the customized solutions we need, along with unparalleled service and the best technicians in the industry," said Tony Kubit, director of Engineering for Sun Country Airlines. "Their proven expertise in 737 NG maintenance and familiarity with our growing fleet made them the obvious choice to provide our APU maintenance and component services going forward." About Sun Country Airlines MN Airlines, LLC, d.b.a. Sun Country Airlines is based in St. Paul, Minnesota. Sun Country, which has earned a reputation for offering world class service at an affordable price, was recently named in the "Top 10 Domestic Airlines" by Travel+Leisure for the fourth year in a row and Conde Nast Traveler for the third year in a row. The airline flies to popular destinations in the United States, Mexico and the Caribbean. For a complete list of destinations and more information, visit http://www.SunCountry.com About Delta TechOps Delta TechOps -- http://www.deltatechops.com-- is the largest airline maintenance, repair and overhaul provider in North America, generating more than $500 million in revenue in 2009. In addition to providing maintenance and engineering support for Delta's fleet of more than 750 aircraft, Delta TechOps serves more than 150 other aviation and airline customers around the world, specializing in high-skill work like engines, components, hangar and line maintenance. Delta TechOps employs more than 8,500 maintenance professionals and is one of the world's most experienced providers with more than seven decades of aviation expertise. About Delta Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to 367 destinations in 66 countries on six continents. Delta employs more than 70,000 employees worldwide and operates a mainline fleet of nearly 800 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry's trans-Atlantic joint venture with Air France KLM. Including its worldwide alliance partners, Delta offers customers more than 16,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline's service includes the SkyMiles frequent flier program, the world's largest airline loyalty program; the BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta became the world's largest airline following merger with Northwest Airlines in 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. At December 31, 2009, Delta had total assets of $43,539,000,000 against total current liabilities of $9,797,000,000 and total noncurrent liabilities of $33,497,000,000, resulting in stockholders' equity of $245,000,000. At end-2008, Delta had stockholders' equity of $874,000,000. The December 31, 2009 balance sheet showed strained liquidity: Delta had total current assets of $7,741,000,000 against total current liabilities of $9,797,000,000. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Negative/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DESERT CAPITAL: Hancock Askew Raises Going Concern Doubt -------------------------------------------------------- On March 23, 2010, Desert Capital REIT, Inc., filed its annual report on Form 10-K for the year ended December 31, 2009. Hancock Askew & Co., LLP, in Savannah, Ga., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and cash flow produced from operating activities is not sufficient to meet current obligations and debt payments. The Company reported a net loss of $55.6 million on interest income of $1.4 million for the year ended December 31, 2009, compared to a net loss of $37.5 million on interest income of $7.4 million for 2008. The Company's balance sheet as of December 31, 2009, showed $83.0 million in assets, $54.9 million of debts, and $28.1 million of stockholders' equity. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c19 Henderson, Nev.-based Desert Capital REIT, Inc. is a Maryland corporation formed in December 2003 as a real estate investment trust. When the Company first began conducting business, it specialized in the financing of real estate projects by providing short-term mortgage loans to homebuilders and commercial developers in markets where it believed it possessed requisite skills and market knowledge, which was primarily in the western United States. Currently, the Company relies primarily on sales of its real estate assets and to a lesser degree on interest income from its performing loans and rental income from its tenants, to provide the cash flow necessary to operate its business. DREIER LLP: 360networks Creditors Lose Bid to Get Artworks ---------------------------------------------------------- Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York denied a bid by the official committee of unsecured creditors of 360networks (USA) Inc. to obtain possession of artworks bought by Marc Dreier. The 360networks Committee has alleged that it retained Dreier LLP, to pursue preference actions for the benefit of the 360 Estates. The Committee said that between October 2007 and November 2008, Mr. Dreier stole and converted more than $50 million of preference recovery funds that were held in trust for the Committee, at which time a constructive trust over the funds was established for the 360 Estates' benefit. The Committee asserted that Mr. Dreier's purchases of various artworks are traceable to the preference recoveries. Federal prosecutors sought dismissal of the 360 Committee's bid, arguing that the funds used to buy the artworks cannot in all circumstances be traced to the preference recoveries. The Committee also argued that the victim restoration process under the authority of the Attorney General entails the pro rata distribution of forfeited property to Mr. Dreier's victims in accordance with the amounts of their losses. In a five-page decision, the Court held that to grant a constructive trust in favor of the 360 Estates would be unfair both to the other Dreier victims, whose funds were likewise stolen in connection with a fiduciary relationship. About 360networks Headquartered in Vancouver, British Columbia, 360networks, Inc. -- http://www.360.net/-- provides fiber optic communications network products and services worldwide. The company, together with 22 affiliates, filed for chapter 11 protection on June 28, 2001 (Bankr. S.D.N.Y. Case No. 01-13721), obtained confirmation of their plan on October 1, 2002, and emerged from chapter 11 on November 12, 2002. Alan J. Lipkin, Esq., and Shelley C. Chapman, Esq., at Willkie Farr & Gallagher, represented the company in the case. Lawyers at Dreier LLP represented the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed $6,326,000,000 in assets and $3,597,000,000 in liabilities. About Dreier LLP Marc Dreier founded New York-based law firm Dreier LLP -- http://www.dreierllp.com/-- in 1996. On December 8, 2008, the U.S. Securities and Exchange Commission filed a suit, alleging that Mr. Dreier made fraudulent offers and sales of securities in several cities, selling fake promissory notes to hedge and other private investment funds. The SEC asserted that Mr. Dreier also distributed phony financial statements and audit opinions, and recruited accomplices in connection with that scheme. Mr. Dreier has been charged by the U.S. government for conspiracy, securities fraud and wire fraud before the U.S. District Court for the Southern District of New York (Manhattan) (Case No. 09-cr-00085-JSR). Dreier LLP filed for Chapter 11 on December 16, 2008 (Bankr. S.D.N.Y., Case No. 08-15051). Judge Robert E. Gerber handles the case. Stephen J. Shimshak, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, has been retained as counsel. The Debtor listed assets between $100 million and $500 million, and debts between $10 million and $50 million in its filing. Wachovia Bank National Association, Sheila M. Gowan as trustee for Chapter 11 estate of Dreier LLP, and Steven J. Reisman as post- confirmation representative of the bankruptcy estate of 360networks (USA) Inc. signed a petition that sent Mr. Dreier to bankruptcy under Chapter 7 on January 26, 2009 (Bankr. S.D. N.Y., Case No. 09-10371). DRESSER-RAND GROUP: Moody's Gives Pos. Outlook; Keeps 'Ba3' Rating ------------------------------------------------------------------ Moody's Investors Service changed the outlook for Dresser-Rand Group, Inc., to positive from stable. Moody's also affirmed its existing Ba3 Corporate Family Rating, Ba1 secured revolving credit facility rating, B1 senior subordinated rating. Moody's upgraded DRC's Speculative Grade Liquidity Rating to SGL-2 from SGL-3. These actions reflect DRC's continued ability to generate a relatively strong base of earnings during the oilfield service capital equipment downcycle. "DRC has the largest installed base of capital equipment in its classes," commented Francis J. Messina, Moody's Vice President. "Consequently, DRC benefits from a strong after-market service equipment business which helps the company weather a downcycle." The positive outlook anticipates that DRC will be the major recipient of any global infrastructure build as new orders have began to build. The fourth quarter '09 new unit bookings of $370 million surged forward from $79 million during the previous quarter. Moody's estimates that backlog will continue to strengthen throughout 2010. Moody's, however, recognizes that the downturn in the oil and gas markets in 2009 adversely affected new unit bookings, which will result in lower new unit sales overall in 2010. Most of DRC's customers are large, financially sound companies that take a longer-term view of the commodity price cycle. As a result, many of these companies have a longer-term view toward projects. Concurrently, DRC's strong aftermarket parts and services business, which benefits from its strong leadership position within its industry, provides a base to its business. DRC's ratings could be upgraded in the second half of 2010 as operating performance improves and financial policies remain prudent. DRC's ratings reflect its strong market share, technological expertise, its dependable aftermarket business, and its relatively strong financial profile. DRC has long-standing relationships due to its distinctively engineered and difficult to duplicate equipment tailored to its customers, which has resulted in the largest installed base of 95,000 units in its industry. As a result of the size and tailored engineered base, DRC's ratings benefit from its strong after-market service equipment business throughout the cycle. DRC's SGL-2 rating reflects its good liquidity. DRC is expected to live within its cash flow in 2010. The company has a $500 million secured bank revolver, maturing 2012, with $241 million of outstanding letters of credit at December 31, 2009. There are two financial based covenants: an interest coverage minimum of 3.0x and leverage test less than 3.75x. Moody's anticipates the company will be well within its covenant parameters. The Ba1 rating for the senior secured facility reflects both the overall probability of default of DRC, to which Moody's assigns a PDR of Ba3, and a loss given default of LGD 2, 17% and its position in its capital structure. The B1 subordinated rating (LGD 5, 81%) is notched significantly below the secured bank rating given its subordination to both the secured and general unsecured debt of the company. The last rating action was on June 13, 2006, when Moody's upgraded DRC's ratings and assigned a stable outlook. Dresser-Rand Group Inc. is headquartered in Houston, Texas. DUBAI WORLD: To Get $9.5-Bil. Bailout From Dubai Government ----------------------------------------------------------- Stefania Bianchi at Dow Jones Newswires reports that Dubai's government said Thursday it will inject about $9.5 billion into Dubai World and real-estate developer Nakheel. Dow Jones relates that, according to a statement by Dubai government, cash for Dubai World "will be funded by $5.7 billion remaining from the loan previously made available from the Government of Abu Dhabi and from internal Dubai government resources." According to Dow Jones, the statement said that "the government is offering to recapitalize Dubai World through the equitization of the Government's $8.9 billion claim and a commitment to fund up to $1.5 billion in new funds." The statement also said the government "is offering to inject approximately $8 billion in new funds, which will have a significant direct impact on the construction and real estate sectors and the wider economy, and to recapitalize Nakheel through the equitization of the government's $1.2 billion claim." Dow Jones also relates a government financial advisor said on a conference call that Dubai World's restructuring will include the selling of some assets. The advisor added that a restructuring plan put forward to Dubai World lenders "will include work to be done to fix companies inside of there, improve companies inside of there, and also eventually include selling companies inside of there." Dow Jones says the government has no specific timeline and "there's no immediate action" on asset sales. Dow Jones also reports that Dubai World's chief restructuring officer, Deloitte's Aidan Birkett, met with bankers Wednesday in a five-hour conference as it hammers out a deal with creditors. A committee of senior creditors leading talks on behalf of the banks includes HSBC Holdings PLC, Standard Chartered PLC, Lloyds Banking Group PLC, Royal Bank of Scotland Group PLC, Abu Dhabi Commercial Bank PJSC and Emirates NBD PJSC. "Government position seems to be supportive with $9.5 billion in new funds and governments own claims being equitised," said Saud Masud, head of Mideast research at Swiss investment bank UBS AG in Dubai, according to Dow Jones. "If proposal is accepted it appears the Nakheel bonds would be paid. This will be a long process nonetheless." 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: Met with Creditors on $26-Bil. Debt Plan ----------------------------------------------------- Carla Main at Bloomberg News reports that Dubai World and its advisers on March 24 completed a meeting with banks to discuss proposals to restructure about $26 billion of debt. According to the report, more than 90 banks are owed money by Dubai World. Seven of its biggest creditors, HSBC Holdings Plc, Royal Bank of Scotland Group Plc, Lloyds Banking Group Plc, Standard Chartered Plc, Bank of Tokyo-Mitsubishi UFJ Ltd., Emirates NBD PJSC and Abu Dhabi Commercial Bank PJSC, are negotiating with Dubai World on behalf of the lenders. 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. ENNIS HOMES: Wants Access to Creditors Cash for April Expenses -------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of California will consider at a hearing on April 2, 2010, at 11:00 a.m., Ennis Homes Inc.'s access to the cash collateral, in which Wells Fargo Bank, Valley Business Bank and Tri-Counties Bank claim to have valid liens. The hearing will be held at Fresno Courtroom 11, Department A. The Debtor sought the Court's permission to use $217,488 of the secured creditors' cash collateral to fund the expenses for the month of April 2010. The Debtor will use the money to continue selling homes and closing escrows. The Debtor related that it is negotiating a debtor-in-possession credit facility with Bank of America. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the secured creditors replacement liens against all of the Debtor's real property, other than (a) any real property that is subject to the existing liens of Wells Fargo Bank; and (b) the 4 remaining parcels in the Silver Springs subdivision that are subject to the existing liens of Citizens Bank, any liens will be junior to all existing liens. About Ennis Homes Inc. Ennis Homes Inc. is a homebuilder in California. Ennis Homes was founded in 1979 by Ben Ennis and has become one of the largest family owned homebuilders in the Central Valley,. Son Brian Ennis serves as President and daughter Pam Ennis acts as Vice President- Marketing of the Company. Ennis Homes Inc. filed for Chapter 11 on Feb. 3, 2009 (Bankr. E.D. Calif. Case No. 09-10848). Hagop T. Bedoyan, Esq., and Jacob L. Eaton, Esq., represent the Debtor as counsel. In its petition, Ennis Homes listed between $100 million and $500 million each in assets and debts. EXTENDED STAY: To Seek Nod of Starwood Investment Pact on April 8 ----------------------------------------------------------------- American Bankruptcy Institute reports that Extended Stay Inc. will head to court on April 8 to request court approval to enter into an investment agreement with Starwood Capital Group that is the centerpiece of its latest reorganization plan. Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). FANNIE MAE: Sec. Geithner Rules Out Nationalization --------------------------------------------------- Sewell Chan at The New York Times reports the Obama administration is moving tentatively to develop a plan to reshape Fannie Mae and Freddie Mac. NY Times relates that the Treasury Department and the Department of Housing and Urban Development on April 15, 2010, will publish a list of questions seeking comment on the appropriate role of the government in housing finance, as well as the design of mortgage products and protections for consumers who use them. NY Times also relates that Treasury secretary, Timothy F. Geithner, said before the House Financial Services Committee on Tuesday, that the administration would "take a fresh, cold, hard look at the core problems" in housing finance and deliver a "comprehensive set of reforms" to Congress, but declined to specify a timetable. According to NY Times, Mr. Geithner ruled out nationalizing Fannie and Freddie or creating several entities to compete with them. Mr. Geithner also mentioned a public utility model, in which the entities would guarantee mortgages without maintaining investment portfolios, thereby limiting the systemic risk they would pose. NY Times notes that Mr. Geithner's predecessor, Henry M. Paulson Jr., had endorsed that model. NY Times also relates that other witnesses proposed to the Congressional panel a variety of solutions: -- Michael D. Berman, chairman of the Mortgage Bankers Association, urged that the government guarantee mortgage -backed securities, but not the regulated entities that would issue them. -- Vince Malta, a vice president for the National Association of Realtors, suggested that Fannie and Freddie be converted into government-chartered nonprofit entities that would be required to place any excess revenues into a reserve fund. -- Robert E. Dewitt, testifying for the National Multi Housing Council and the National Apartment Association, which represent the rental housing industry, called for "a balanced housing policy that doesn't measure success solely by how much home ownership there is." NY Times notes that the government has so far spent $126 billion bailing out Fannie and Freddie. About Fannie Mae Fannie Mae -- http://www.fanniemae.com/-- is a government- sponsored enterprise that was chartered by Congress in 1938. Fannie Mae securitizes mortgage loans originated by lenders in the primary mortgage market into mortgage-backed securities, which can then be bought and sold in the secondary mortgage market. Fannie Mae also participates in the secondary mortgage market by purchasing mortgage loans and mortgage-related securities, including the Fannie Mae MBS, for its own mortgage portfolio. In addition, Fannie Mae makes other investments that increase the supply of affordable housing. Under its charter, Fannie Mae may not lend money directly to consumers in the primary mortgage market. Although Fannie Mae is a corporation chartered by the U.S. Congress, and although its conservator is a U.S. government agency and Treasury owns its senior preferred stock and a warrant to purchase its common stock, the U.S. government does not guarantee its securities or other obligations. Conservatorship As reported by the Troubled Company Reporter, the U.S. government took direct responsibility for Fannie Mae and Freddie Mac, placing the government sponsored enterprises under conservatorship on September 7, 2008. James B. Lockhart, director of Federal Housing Finance Agency, said that Fannie Mae and Freddie Mac share the critical mission of providing stability and liquidity to the housing market. Between them, the Enterprises have $5.4 trillion of guaranteed mortgage-backed securities (MBS) and debt outstanding, which is equal to the publicly held debt of the United States. Among the key components of the conservatorship, the FHFA, as conservator, assumed the power of the Board and management. FREDDIE MAC: Sec. Geithner Rules Out Nationalization ---------------------------------------------------- Sewell Chan at The New York Times reports the Obama administration is moving tentatively to develop a plan to reshape Fannie Mae and Freddie Mac. NY Times relates that the Treasury Department and the Department of Housing and Urban Development on April 15, 2010, will publish a list of questions seeking comment on the appropriate role of the government in housing finance, as well as the design of mortgage products and protections for consumers who use them. NY Times also relates that Treasury secretary, Timothy F. Geithner, said before the House Financial Services Committee on Tuesday, that the administration would "take a fresh, cold, hard look at the core problems" in housing finance and deliver a "comprehensive set of reforms" to Congress, but declined to specify a timetable. According to NY Times, Mr. Geithner ruled out nationalizing Fannie and Freddie or creating several entities to compete with them. Mr. Geithner also mentioned a public utility model, in which the entities would guarantee mortgages without maintaining investment portfolios, thereby limiting the systemic risk they would pose. NY Times notes that Mr. Geithner's predecessor, Henry M. Paulson Jr., had endorsed that model. NY Times also relates that other witnesses proposed to the Congressional panel a variety of solutions: -- Michael D. Berman, chairman of the Mortgage Bankers Association, urged that the government guarantee mortgage -backed securities, but not the regulated entities that would issue them. -- Vince Malta, a vice president for the National Association of Realtors, suggested that Fannie and Freddie be converted into government-chartered nonprofit entities that would be required to place any excess revenues into a reserve fund. -- Robert E. Dewitt, testifying for the National Multi Housing Council and the National Apartment Association, which represent the rental housing industry, called for "a balanced housing policy that doesn't measure success solely by how much home ownership there is." NY Times notes that the government has so far spent $126 billion bailing out Fannie and Freddie. About Freddie Mac Based in McLean, Virginia, Freddie Mac (NYSE: FRE) -- http://www.FreddieMac.com/-- was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. The Company's participation in the secondary mortgage market includes providing its credit guarantee for residential mortgages originated by mortgage lenders and investing in mortgage loans and mortgage- related securities. The Company earns management and guarantee fees for providing its guarantee and performing management activities (such as ongoing trustee services, administration of pass-through amounts, paying agent services, tax reporting and other required services) with respect to issued PCs and Structured Securities. At December 31, 2009, the Company's consolidated balance sheets showed total assets of $841.,784 billion, total liabilities of $837.412 billion, and total equity of $4.372 billion. Freddie Mac is under conservatorship and is dependent upon the continued support of Treasury and FHFA to continue operating its business. The Company received $6.1 billion and $30.8 billion in June 2009 and March 2009, respectively, pursuant to draw requests that FHFA submitted to Treasury on the Company's behalf to address the deficits in the Company's net worth as of March 31, 2009, and December 31, 2008, respectively. As a result of funding of the draw requests, the aggregate liquidation preference on the senior preferred stock owned by Treasury increased from $14.8 billion as of December 31, 2008, to $51.7 billion on December 31, 2009. FILI ENTERPRISES: Can Use BofA Cash Collateral Through April 11 --------------------------------------------------------------- Hon. Peter W. Bowie of the U.S. Bankruptcy Court for the Southern District of California issued a third interim order authorizing Fili Enterprises, dba Daphne's Greek Cafe, to use cash collateral securing the Debtor's obligation to Bank of America, N.A., through April 11, 2010. According to the Court's Third Interim Cash Collateral Order, Bank of America asserts that: (a) certain prepetition obligations owed to Bank of America were, as of the Petition Date, secured by valid, enforceable and properly perfected liens on and security interests in substantially all of the Debtor's personal property and other assets, including, without limitation, cash on hand of the Debtor and cash and receipts generated by the operation of the Debtor's business; and (b) the cash proceeds on hand as of the petition date and the cash proceeds generated from the post-petition use and sale of the Prepetition Collateral, constitute "cash collateral" within the meaning of Section 363(a) of the Bankruptcy Code. The Debtor and the Committee of Unsecured Creditors both dispute whether all of the cash on hand as of the Petition Date, or the cash generated postpetition from the operation of the Debtor's business, constitute Bank of America's cash collateral. The Court has not yet made a determination regarding the extent to which Debtor's cash on hand as of the Petition Date, or the cash generated postpetition from the operation of the Debtor's business, constitute BofA's cash collateral. For the purposes of the Third Interim Order, only that portion of the Debtor's cash that is later found to properly constitute BofA's cash collateral, will be referred to as "Cash Collateral." The Court says BofA will have a claim under Section 507(b) of the Bankruptcy Code for the diminution in the value of the Collateral, if any, arising from the Debtor's use of the Collateral, or resulting from the imposition of the automatic stay. The Debtor and Committee each reserve all rights to challenge the extent and amount of any Adequate Protection Claims asserted by BofA. To secure the Adequate Protection Claims, the Court grants BofA (1) adequate protection payments as provided for in the Debtor's budget; and (2) replacement security interests in, and liens upon, the Prepetition Collateral, all postpetition proceeds and all postpetition assets of the Debtor, excluding, however, all claims, causes of action and proceeds arising under Sections 510, 544, 545, 546, 547, 548, and 549 of the Bankruptcy Code. The Cash Collateral Order also provides that the Debtor will deliver to the landlords that requested adequate protection in response to the Cash Collateral Motion a check made payable to the Objecting Landlord in the amount of the of pro-rated rent and charges for the period January 11 through and including January 31, 2010, payable under 11 U.S.C. Section 365(d)(3). Payments were to be made as follows: -- On or before February 22, 2010, each of the Objecting Landlords were to receive one-half of its January Stub Rent; and -- On or before March 15, 2010, each of the Objecting Landlords were to receive the remainder of its January Stub Rent. The Debtor is to maintain cash reserves in the aggregate amount of January Stub Rent payable to landlords who are not Objecting Landlords. The Objecting Landlords are Azure Creekside Corporation; Rolling Hills Plaza LLC; 45 Plaza Associates LLC; Flamingo Investment, Inc.; La Jolla Village Square; Montalvo Shopping Center, LLC; CLPF West Hollywood, LP; Plaza Paseo Real Associates, LLC; KFT Enterprises No. 2, LP; Simi Entertainment Plaza, LP; Huntington Center Associates, LLC; Terra Nova Plaza; PK III Encinitas Marketplace L.P.; Park Place Realty Holding Co., Inc.; Kimco Westlake, LP; The Macerich Partnership, LP; FR Crow Canyon LLC; Thousand Oaks Marketplace, LP; and, Bella Terra Associates, LLC. The next Cash Collateral Hearing will take place on April 9, 2010, at 2:00 p.m. Objections to be heard at the April 9, 2010 hearing must be filed by the close of business on April 5, 2010. The Debtor will provide to the Creditors' Committee and BofA a copy of the budget for the period after April 11, 2010, by not later than March 31, 2010. The Debtor is represented by: Karol K. Denniston, Esq. -- karol.denniston@dlapiper.com Brendan P. Collins, Esq. -- brendan.collins@dlapiper.com The Debtor's secured creditor is represented by: Richard W. Esterkin, Esq. -- resterkin@morganlewis.com The Official Committee of Unsecured Creditors is represented by: Jeff Pomerantz, Esq. -- jpomerantz@pszjlaw.com San Diego, California-based Fili Enterprises, Inc. -- dba Daphne's Greek Cafe, aka Daphne's Greek Express -- filed for Chapter 11 bankruptcy protection on January 11, 2010 (Bankr. S.D. Calif. Case No. 10-00324). Brendan Collins, Esq., and Natasha Johnson, Esq., at DLA Piper LLP (US), assist the Company in its restructuring effort. In its schedules of assets and liabilities, the Company disclosed total assets of $16,723,356 and total liabilities of $16,335,468. FINLAY ENTERPRISES: Coles Resigns as Chief Restructuring Officer ---------------------------------------------------------------- David J. Coles has resigned his position as Chief Restructuring Officer of Finlay Enterprises, Inc. effective March 31, 2010. Effective April 1, 2010, Bruce E. Zurlnick will replace Mr. Coles as the Company's Chief Restructuring Officer. About Finlay Enterprises Finlay Enterprises, Inc. (OTC Bulletin Board: FNLY) through its wholly owned subsidiary, Finlay Fine Jewelry Corporation, is a retailer of fine jewelry operating luxury stand-alone specialty jewelry stores and licensed fine jewelry departments in department stores throughout the United States and achieved sales of $754.3 million in fiscal 2008. The number of locations at the end of the second quarter ended August 1, 2009, totaled 182, including 67 Bailey Banks & Biddle, 34 Carlyle and four Congress specialty jewelry stores and 77 licensed departments with The Bon Ton. The Company and seven affiliates filed for Chapter 11 on August 5, 2009 (Bankr. S. D. N.Y. Case No. 09-14873). Weil, Gotshal & Manges LLP, serves as bankruptcy counsel. Alvarez & Marsal North America, LLC, is engaged as restructuring advisor in the Chapter 11 case, and the firm's David Coles is appointed as chief restructuring officer. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Judge James Peck presides over the case. In its bankruptcy petition, Finlay Enterprises disclosed assets of $331,824,000 against debts of $385,476,000 as of July 4, 2009. As of the petition date, Finlay owes $38 million outstanding under a first lien credit agreement, $24.7 million under second lien notes, $176.6 million outstanding under third lien notes (in addition to $17.5 million to secured vendors), and $40.6 million under remaining unsecured obligations under the senior notes. On September 25, 2009, the Bankruptcy Court appointed Gordon Brothers Retail Partners, LLC, as agent for Finlay Enterprises and its affiliates and subsidiaries to conduct 'store closing" or similar sales of merchandise located at all of the Company's retail store locations and the Company's two distribution centers. The transaction is expected to be completed by February 28, 2010. Gordon Brothers bid 85.75 cents on the dollar for inventory valued at an estimated $116 million for closings sales of 49 Finlay stores. Gordon had a prepetition contract to conduct store closings sales for 55 other stores. FRONTIER COMMUNICATIONS: Fitch Retains Positive Watch on Ratings ---------------------------------------------------------------- Fitch Ratings has maintained the Rating Watch Positive status on Frontier Communications Corporation after reviewing Frontier's recent financial performance and the current status of its proposed transaction as outlined below. In addition, Fitch has assigned a 'BB' Issuer Default Rating to New Communications Holdings Inc. and a 'BB' rating to Spinco's proposed offering of senior unsecured debt due 2017 and 2020. Spinco is a subsidiary of Verizon Communications Inc. which will merged with and into Frontier at the expected mid-2010 close of Frontier's acquisition of certain Verizon access lines. These ratings remain on Rating Watch Positive by Fitch: Frontier Communications Corporation: -- IDR 'BB'; -- Senior unsecured $250 million credit facility due May 18, 2012 'BB'; -- Senior unsecured $145.5 million senior unsecured term loan due Dec. 31, 2012; -- Senior unsecured notes and debentures 'BB'. Industrial development revenue bonds 'BB': -- Maricopa County Industrial Development Authority (AZ) IDRB series 1995. These ratings have also been placed on Rating Watch Positive: New Communications Holdings, Inc. -- IDR 'BB'; -- Senior unsecured notes. In addition, Fitch expects to rate Frontier's proposed $750 million senior unsecured credit facility 'BB', Rating Watch Positive. The facility will become effective on the close of the acquisition of the Verizon lines. Once the $750 million facility is in place, Frontier's existing $250 million credit facility will terminate and Fitch will withdraw the rating on the latter facility. Gross proceeds from the note offering, plus cash, will be placed into an escrow account to fund a portion of the special cash payment that Verizon will receive just prior to the spin-off. Immediately prior to the spin-off of Spinco from Verizon, the proceeds will be released from the escrow account and will partly fund a special payment to Verizon. Upon the merger of Spinco and Frontier, Spinco will cease to exist and the notes will become senior unsecured obligations of Frontier and rank pari passu with existing Frontier debt. Frontier's 'BB' rating reflects its strong operating margins and access to ample liquidity. As a result of the potential positive effects of the Verizon transaction on Frontier's credit profile, the company's 'BB' IDR and other ratings were placed on Rating Watch Positive. Fitch anticipates that Frontier's pro forma gross debt to EBITDA (including integration expenses) at year-end 2010 will be in the 3.0 times to 3.1x range, substantially lower than the 4.3x recorded at year-end 2009 due to the delevering effect of the transaction. In addition, cash flows will benefit from Frontier's planned 25% reduction in its per share common dividend. The Rating Watch Positive reflects expectations for strengthened credit metrics following the close of the merger, particularly a material decline in leverage. Improvements in leverage will be partly offset in the near term by integration costs and investments to expand broadband availability. Fitch currently believes financial flexibility could improve once the integration costs and broadband expansion spending are largely behind the company and material progress on achieving synergies occurs. Fitch anticipates resolving the Rating Watch Positive prior to the close of the merger, and following regulatory approvals and the completion of financing for the transaction. The ratings also reflect the trends in Frontier's core rural telecommunications operations, which are facing a slow but relatively stable state of decline due to continued pressure of competition and a sluggish economic recovery. The company has been mitigating the effect of access line losses to cable operators and wireless providers through the marketing of additional services, including high-speed data, and through cost controls. Frontier's ample liquidity is derived from its cash balances, free cash flow, and its revolving credit facility. At Dec. 31, 2009, Frontier had $359 million in cash and in 2009 free cash flow was approximately $175 million. Frontier's expectations for 2010 capital spending range from $220 million to $240 million on a stand-alone basis, and an additional $180 million will be spent on integration activities in anticipation of the Verizon line acquisition. In addition to its cash balances and free cash flow, liquidity is provided by an undrawn $250 million five-year credit facility, which expires May 2012. The facility will be available for general corporate purposes but may not be used to fund dividend payments. Frontier has approximately $7 million of debt due in 2010, $280 million due in 2011 and $180 million due in 2012. If the Verizon line acquisition closes as anticipated in mid-2010, there will be virtually no change to Frontier's anticipated 2010- 2012 maturity schedule. GENERAL MOTORS: To Make $1-Bil. Loan Repayment on Wednesday ----------------------------------------------------------- Dow Jones Daily Bankruptcy Review reports that General Motors Corp. expects to make a $1 billion loan repayment to the U.S. Treasury on Wednesday as part of its promise to begin giving back government money ahead of schedule, a person familiar with the plan said. As reported by the Troubled Company Reporter on March 12, 2010, Katie Merx at Bloomberg News said GM plans to pay back government loans before June. Bloomberg reported that Chief Executive Officer Ed Whitacre reiterated March 10 that GM aims to repay about $5.7 billion in remaining U.S. debt before June. 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 GROWTH: Beachwood Place, 4 Others Win Plan Confirmation --------------------------------------------------------------- Bankruptcy Judge Allan Gropper confirmed the Joint Plan of Reorganization, and approved, on a final basis, the accompanying Disclosure Statement as to five debtors on March 18, 2010. The Plan Debtors subject to confirmation are: * Beachwood Place Mall LLC * Beachwood Place Holding LLC * 10000 West Charleston Boulevard, LLC * 120/1140 Town Center Drive, LLC * 9901-9921 Covington Cross, LLC "I commend the parties for having been able to get to this point," Judge Gropper was quoted by Bloomberg News as saying at the March 18 hearing. Judge Gropper approved the Disclosure Statement, as amended, as providing holders of Claims entitled to vote on the Plan with adequate information to make an informed decision as to whether to vote to accept or reject the Plan in accordance with Section 1125(a)(1) of the Bankruptcy Code. The Disclosure Statement provides Holders of Claims and Interests and other parties-in-interest with sufficient notice of the release, exculpation and injunction provisions contained in the Plan, in satisfaction of the requirements of Rule 3016(c) of the Federal Rules of Bankruptcy Procedure, Judge Gropper said. General Growth Properties, Inc. is also negotiating agreements with its last four property loans, Reuters noted. GGP has reached a tentative agreement to restructure a $2.5 billion loan on 24 properties, Reuters related. GGP is "wrestling" with Deutsche Bank AG for Fashion Show and the Shoppes at The Palazzo malls, the report said. A fourth loan is on the Oakwood Mall, Reuters added. Prior to the confirmation of the Plan, Thomas H. Nolan, Jr., president and chief operating officer of GGP, filed with the Court a declaration on March 17, 2010, in support of the confirmation of the Plan with respect to the Five Plan Debtors. Mr. Nolan told the Court that the Plan: (i) maintains the current, non-default contract rate of interest across all of the loans; (ii) extends the loans maturity dates to October 6, 2017, for a $240.2 million CMBS loan secured by Beachwood Place Mall, LLC, and to March 3, 2015 for a $21.8 million non- CMBS loan to which 10000 West Charleston Boulevard, LLC, 1120/1140 Town Center Dive, LLC and 9901-9921 Covington Cross, LLC are borrowers; and (iii) permits the Five Plan Debtors to continue using their existing cash management system. In exchange with the Plan terms negotiated with the secured creditors, the Five Plan Debtors agreed, among others: (i) to pay a restructuring fee of 100 basis points on the outstanding balance of the loans upon emergence; (ii) for the Beachwood Loan, to pay a special servicing fee equal to the special servicing fee for such loans under Pooling & Servicing Agreements; (iii) to catch up any unpaid amortization during the Chapter 11 cases upon emergence; (iv) for the Beachwood Loan, to increase amortization payments during the term of the loan upon emergence; and (v) to set aside new reserve amounts during the term of the loans. Mr. Nolan insisted that the Plan should be confirmed because: (i) it satisfies the classification requirements of Section 1122 of the Bankruptcy Code; (ii) it satisfies the seven mandatory requirements of Section 1123(a) of the Bankruptcy; (iii) its provisions are in accordance with the discretionary authority of Section 1123(b) of the Bankruptcy Code; (iv) it was proposed in good faith as the result of collaborative efforts between the Five Plan Debtors and the Secured Debt Holders; and (v) the directors and officers of the reorganized Five Plan Debtors comply with Section 1129(a)(5)(A)(ii) of the Bankruptcy Code. Mr. Nolan further said that the Plan provides a 100% estimated recovery for all Allowed Claims and Interests under the Supplemental Plan. In this light, Mr. Nolan maintained that confirmation of the Plan will position the Five Debtors to deliver sustainable, significant value to their stakeholders, including lenders, customers, and employees. Updated Financial Projections 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 17, 2010, appending an updated version of the Debtors' financial projections. Mr. Mesterharm noted that the updated Financial Projections reflect recent performance, certain adjustments to reflect GGP'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_mar17cashforecast.pdf Based on the Updated Financial Projections, Mr. Mesterharm stated that the Plan Debtors, with the continued use of the GGP enterprise's consolidated cash management system and associated liquidity, will have sufficient cash flow to: (a) make all payments and other distributions required under the Plan; (b) service all debt obligations contemplated by the Plan; and (c) continue to operate their businesses as contemplated by the Plan. Mr. Mesterharm further said that at the end of February 2010, the Debtors had $520.1 million of cash on hand. Through the end of 2010, the Plan Debtors will incur another $103.0 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 loan and the paydown of certain mezzanine loan obligations, of which $8.4 million is related to the Plan Debtors whose confirmation hearing is scheduled for March 18, 2010, he noted. The Plan Debtors will also incur $80.9 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 $29.1 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 $313.1 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 March 17, 2010, amended exhibits to their Plan to (i) supplement property-specific Exhibit "B" with respect to 10000 West Charleston Boulevard, LLC; 1120/1140 Town Center Drive, LLC and 9901-9921 Covington Cross, LLC; and (ii) amend and replace property-specific Exhibit "B" to Beachwood Place Mall, LLC. A full-text copy of property-specific Exhibit "B" for these Five Plan Debtors is available for free at: http://bankrupt.com/misc/ggp_5DebPropExhibitB.pdf Plan Confirmation Rulings 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 March 18, 2010, Judge Gropper averred. 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 Five 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. Moreover, all objections, responses, statements and comments in opposition to the Plan, including those raised at the confirmation hearings on December 15, 2009, December 22, 2009, January 20, 2010, February 16, 2010, March 3, 2010 and March 18, 2010, other than those withdrawn with prejudice in their entirety prior to the confirmation hearing on March 18, 2010, or otherwise resolved on the December 15 confirmation hearing, December 22 confirmation hearing, January 20 confirmation hearing, the February 16 confirmation hearing, the March 3 confirmation hearing or the March 18 confirmation hearing are overruled, Judge Gropper said. A full-text copy of the Confirmation Order dated March 18, 2010, is available for free at: http://bankrupt.com/misc/ggp_Mar18ConfOrder.pdf Voting Results Travis K. Vandell, senior managing consultant at Kurtzman Carson Consultants LLC, filed with the Court on March 17, 2010, a supplemental tabulation of votes for the Joint Plan of Reorganization with respect to Plan Debtors Beachwood Place Mall, LLC, 9901-9921 Covington Cross, LLC, 1120/1140 Town Center Drive, LLC, and 10000 West Charleston Boulevard, LLC. Four creditors grouped as Class B holding a total of $323,909,141 voted to accept the Plan. Class B is the only voting class under the Plan. Accept or Dollars Dollars Creditor Name Reject Accept Reject ------------- --------- --------- ------- Bank of America N.A. Accept $258,593,930 $0 Metropolitan Life Accept $21,771,737 $0 Insurance Company Metropolitan Life Accept $21,771,737 $0 Insurance Company Metropolitan Life Accept $21,771,737 $0 Insurance Company BofA is successor-in-interest to LaSalle Bank NA and Landesbank Baden Wurttemberg. A full-text copy of the Tabulation Report on the votes on the Plan is available for free at: http://bankrupt.com/misc/ggp_4PlanDebtorsVotingResults.pdf 27 Affiliates Added to Plan As of March 17, 2010, 27 Debtors were added as proponents to the Joint Plan of Reorganization: * Birchwood Mall, LLC * Cache Valle, LLC * Colony Square Mall L.L.C. * Fallen Timbers Shops, LLC * GGP-Columbiana Trust * GGP-Foothills L.L.C. * Mall of the Bluffs, LLC * Mayfair Mall, LLC * Mondawmin Business Trust * North Plains Mall, LLC * North Town Mall, LLC * Oakwood Hills Mall, LLC * OM Borrower, LLC * Owings Mills Limited Partnership * Pierre Bossier Mall, LLC * Pioneer Office Limited Partnership * Pioneer Place Limited Partnership * Price-ASG L.L.C. * Rouse-Portland, LLC * Sierra Vista Mall, LLC * Silver Lake Mall, LLC * Southwest Denver Land L.L.C. * Southwest Plaza L.L.C. * Spring Hill Mall L.L.C. * The Rouse Company at Owings Mills, LLC * Westwood Mall, LLC * White Mountain Mall, LLC Judge Gropper will convene a hearing with respect to confirmation of the Joint Plan of Reorganization and final approval of the Disclosure Statement as to the Additional Plan Debtors on March 26, 2010. Objections to the Disclosure Statement and Plan are due March 25. 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: Finalizes Deals; Reorganization Plan Expected ------------------------------------------------------------- General Growth Properties, Inc., will file with the United States Bankruptcy Court for the Southern District of New York a new proposal to reorganize its holding company this week, Tiffany Kary of Bloomberg News disclosed. At a hearing held March 18, 2010, GGP informed Bankruptcy Judge Allan L. Gropper that it needed more time to finalize its agreements for its reorganization plan in light of the size and complexity of the $6.5 billion commitments from Brookfield Asset Management Inc. and Fairholme Capital Management LLC and Pershing Square Capital Management LP, Reuters reported. Under the new reorganization plan, GGP would get more than $6 billion in cash and another $250 million to back a rights offering, Ms. Kary said. Specifically, $3.8 billion will come from Fairholme and Pershing and $2.5 billion will come from Brookfield, counsel to GGP, Marcia L. Goldstein, Esq., at Weil, Gotshal & Manges LLP, in New York, told Judge Gropper, Ms. Kary noted. "The Debtors are pleased," Bloomberg quoted Ms. Goldstein as saying in light of the terms of the new reorganization plan. To recall, GGP was expected to file a reorganization plan contemplating a split of the company's good and bad assets on March 18, 2010. GGP also said in previous Court filings that it intend to file a motion to approve proposed bidding procedures or selection of plan transaction on March 19, 2010. A hearing on the Bidding Procedures Motion is scheduled for April 13, 2010, before the Bankruptcy Court. As of March 22, 2010, the Debtors have not yet filed any bidding procedures motion. Elliott & Paulson to Join GGP's Plan Elliott Associates, L.P., and Paulson & Co. are engaged in talks to team with Brookfield in a bankruptcy exit plan for GGP, Dan Levy, Saijel Kishan and Daniel Taub of Bloomberg News reported March 22, citing two people familiar with the matter. Elliott Associates and Paulson have talked with GGP and are to replace or join Fairholme Capital Management and Pershing Square Capital Management LP in the bankruptcy exit plan with Brookfield, disclosed the two people who wished to be unidentified as the talks are private, Bloomberg noted. The report said Elliott and Paulson's proposal may include Luxor Capital Group LP or other funds, a person familiar with the proposal told Bloomberg. 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: Miller Buckfire May Deliver Fairness Opinion ------------------------------------------------------------ Bankruptcy Judge Allan Gropper entered a formal order on March 18, 2010, approving General Growth Properties Inc.'s supplemental application to employ Miller Buckfire & Co., LLC. Judge Gropper further ruled that Diana G. Adams, the U.S. Trustee for Region 2, retains all rights to object to Miller Buckfire's interim and final fee applications on all grounds, including but not limited to the reasonableness standard under Section 330 of the Bankruptcy Code. The Official Committee of Unsecured Creditors withdrew its objection to the Debtors' supplemental application to employ Miller Buckfire. In the supplemental application, the Debtors and Miller Buckfire sought to amend the terms of the engagement to fix the firm's fees at $30,250,000, thus lowering the total compensation payable to Miller Buckfire from the prior maximum of $33,000,000. The terms of the Third Supplement are: (a) At the request of General Growth Properties, Inc., Miller Buckfire will deliver a Fairness Opinion, for which Miller Buckfire will receive a fee of $3,000,000 upon delivery of the Fairness Opinion; provided, however, that 100% of the Opinion Fee will be credited against a Fixed Fee. (b) Miller Buckfire has agreed to forgo any Financing Fee in connection with its retention. The effect of this is (i) to eliminate any possible difference in fees for Miller Buckfire should the Debtors pursue one type of transaction over another, example, a financing rather than an M&A transaction, or vice versa, and (ii) more closely mirror the fee structure contemplated by UBS Securities LLC's retention. (c) The total amount of all fees actually paid to Miller Buckfire by the Debtors will be $30,250,000. Accordingly, upon consummation of a Transaction, Miller Buckfire will be paid $30,250,000, provided that all fees actually paid to Miller Buckfire by the Debtors will be credited against the fixed fee. This represents a reduction of $2,750,000 from the previous potential maximum fee of $33,000,000. This reduction was agreed to by Miller Buckfire in consideration of the Debtors' proposed employment of UBS. 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: Simon to Sweeten Offer, Lines Up Financing ---------------------------------------------------------- Simon Property Group Inc. sent a letter March 15 to General Growth Properties Inc.'s lawyers saying it expects to deliver its improved proposal late this week or early next, The Wall Street Journal's Kris Hudson, Mike Spector and Jeffrey McCracken, citing people familiar with the matter, report. Sources told the Journal Simon didn't outline details of its offer, which are still in flux. The Journal related that its sources said Simon indicated in the letter that it will resolve antitrust concerns that may arise from its proposed combination. According to Simon's letter, it is working to come up with a better offer in partnership with Blackstone Group LP and two sovereign-wealth funds it hasn't identified. Simon also is lining up a $6 billion credit line led by J.P. Morgan Chase & Co. to help finance the bid, according to the letter. One person familiar with the matter told the Journal that Citigroup Inc. and Morgan Stanley are part of the bank group that JP Morgan is leading. It remained unclear exactly how the $6 billion in financing would play into Simon's new bid, the Journal notes. Earlier this month property investor Brookfield Asset Management Inc. and General Growth investors Fairholme Capital Management and Pershing Square Capital Management LP unveiled a recapitalization proposal that would split General Growth into two entities upon emerging from bankruptcy and values the company at $15 per share. The Journal says the timing of Simon's increased bid will depend on how soon competing bidders file definitive documents outlining their offer in the bankruptcy case. That filing is expected within the next week. The Journal also relates Simon stated in its letter that it will stop participating in the bidding after the April 13 hearing if the Brookfield plan is approved as the stalking horse. The Journal says General Growth declined to comment other than to say, "Our goal is to maximize value for all stakeholders." The Journal adds that the letter was a response to a written inquiry from General Growth's advisers for additional details about Simon's initial bid. 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) GMAC INC: Sells Factoring Business to Wells Fargo ------------------------------------------------- Wells Fargo & Company said Wednesday that Wells Fargo Bank, N.A. has entered into a definitive agreement to purchase substantially all of the North American factoring portfolio of the Commercial Services Division of GMAC Commercial Finance Group. The portfolio consists of approximately 150 small and middle-market clients that primarily serve the retail channel, representing approximately $4 billion in annual volume of factored receivables. Wells Fargo Bank will also acquire the client service application system currently used to manage these relationships. The portfolio and client service application system will become part of the Trade Capital division of Wells Fargo Capital Finance upon the closing of the transaction. Terms of the purchase were not disclosed. "We are pleased to welcome these new clients and their customers to Wells Fargo," said Stuart Brister, president of the Trade Capital division of Wells Fargo Capital Finance. "We look forward to being able to help them achieve success through the expertise we've gained in more than 50 years in factoring and through all the additional financial products and services Wells Fargo has to offer." "Wells Fargo is committed to helping small and middle-market businesses succeed," said Bill Mayer, president of the Commercial & Retail Finance Group at Wells Fargo Capital Finance, of which the Trade Capital division is a part. "Being able to provide continuous service and financing for these clients during these uncertain times is another example of how we deliver on that commitment." Wells Fargo Bank, N.A., was advised by Wells Fargo Securities. Wells Fargo & Company is a diversified financial services company with $1.2 trillion in assets, providing banking, insurance, investments, mortgage and consumer finance through more than 10,000 stores and 12,000 ATMs and the Internet -- http://www.wellsfargo.com/-- across North America and internationally. Bloomberg News' Dakin Campbell noted that GMAC Chief Executive Officer Michael Carpenter is selling units to focus on auto financing after losses tied to home lending forced the firm to accept three U.S. bailouts. According to Bloomberg, Mr. Carpenter is seeking buyers for commercial finance assets worth about $200 million at the end of last year, according to the company's year-end filing. Factoring allows companies to gain liquidity by selling their receivables for cash, Bloomberg notes. Bloomberg also relates GMAC said in fourth-quarter filings it would sell the factoring unit and marked down $30 million in assets in preparation. GMAC's filing listed $233 million of loans and finance receivables for sale within the unit that includes the factoring operations. The GMAC business is part of GMAC Commercial Finance which offers global factoring, accounts receivable finance and loan facilities that range from $5 million to $500 million, Bloomberg says, citing the company's Web site. About GMAC Inc GMAC Inc. -- http://www.gmacfs.com/-- is a bank holding company with 15 million customers worldwide. As a global, independent financial services institution, GMAC's diversified business operations include automotive finance, mortgage operations, insurance, commercial finance and online banking. GMAC Inc. was founded in 1919 as a wholly owned subsidiary of General Motors Corporation. On November 30, 2006, General Motors Corporation sold a 51% interest in the Company to FIM Holdings LLC, an investment consortium led by Cerberus FIM Investors, LLC, the sole managing member. On December 24, 2008, the Board of Governors of the Federal Reserve System approved the Company's application to become a bank holding company under the Bank Holding Company Act of 1956, as amended. In connection with this approval, GM and FIM Holdings were required to significantly reduce their voting equity ownership interests in GMAC. These reductions in ownership occurred in 2009. Ally Bank, a unit of GMAC Financial Services, is an online U.S. bank that provides an array of products, including online savings accounts, money-market savings accounts and a variety of no penalty certificates of deposit. The bank was founded on three core values: talking straight, doing what's right and being obviously better than the competition. Ally Bank's total assets were $42.5 billion at the end of the second quarter of 2009. Headquartered in Minneapolis, Minnesota, Residential Capital LLC -- http://www.rescapholdings.com/-- is the home mortgage unit of GMAC Financial Services, which is in turn wholly owned by GMAC LLC. * * * For the 2009 full year, GMAC reported a net loss of $10.3 billion, compared to net income of $1.9 billion in 2008. GMAC reported that as of Dec. 31, 2009, it had $172.306 billion in total assets and total debt of $98.313 billion. GMAC says there is substantial doubt about ResCap's ability to continue as a going concern. GMAC says that should ResCap file for bankruptcy, its investment related to ResCap's equity position would likely be reduced to zero. Dow Jones notes GMAC has received $16.3 billion of federal aid as part of an effort to avoid bankruptcy. It converted into a bank- holding company at the end of 2008 to help make it through the financial crisis. In February 2010, Moody's Investors Service upgraded the senior unsecured rating of GMAC and GMAC-supported subsidiaries to B3 from Ca, with a stable rating outlook. At the end of January, Standard & Poor's Ratings Services raised its long-term counterparty credit rating on both GMAC and Residential Capital to 'B' from 'CCC'. GREAT ATLANTIC: Senior VP Jennifer MacLeod to Leave Company ----------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. reported that Jennifer MacLeod, the Company's Senior Vice President, Marketing and Communications, will leave the Company to pursue other opportunities. The Great Atlantic & Pacific Tea Company, Inc., based in Montvale, New Jersey, operates conventional supermarkets, combination food and drug stores and discount food stores in 8 U.S. states and the District of Columbia. The Company's business consists strictly of retail operations, which totaled 433 stores as of December 5, 2009. During the 40 weeks ended December 5, 2009, the Company operated in four reportable segments: Fresh, Price Impact, Gourmet and Other. The Other segment includes Food Basics and Liquor businesses. As of December 5, 2009, the Company had $3,025,429,000 in total assets against $3,383,900,000 in total liabilities, resulting in stockholders' deficit of $402,186,000. * * * The Company's existing corporate rating with Moody's Investors Service is B3 with a negative outlook. The Company's senior unsecured debt is rated Caa1, its senior secured notes are rated B3 and its liquidity rating is SGL-3. The Company's corporate credit rating with Standard & Poor's Ratings Group is B- with a stable outlook. Its senior unsecured debt is rated CCC, and its recovery rating is 6, indicating that lenders can expect a negligible (0%-10%) recovery in the event of a payment default. Its senior secured notes are rated B-, with a recovery rating of 4, indicating that lenders can expect an average recovery (30%-50%) in the event of a payment default. Its preferred stock rating is CCC-. HAYES LEMMERZ: Howell Can Sell Michigan Facility to Lucy Road ------------------------------------------------------------- The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware authorized Lemmerz International - Howell, Inc., a debtor-affiliate of Hayes Lemmerz International, Inc., to sell its idle manufacturing facility and real property located in Howell Township, Michigan, to Lucy Road Resources, LLC. The sale was free and clear of all claims, liens, interests and other encumbrances. Originally founded in 1908, Hayes Lemmerz International, Inc. (NasdaqGM: HAYZ) is a worldwide producer of aluminum and steel wheels for passenger cars and light trucks and of steel wheels for commercial trucks and trailers. The Company is also a supplier of automotive powertrain components. The Company has global operations with 23 facilities, including business, sales offices and manufacturing facilities, located in 12 countries around the world. The Company sells products to every major North American, Asian and European manufacturer of passenger cars and light trucks and to commercial highway vehicle customers throughout the world. The Company and certain affiliates filed for bankruptcy on May 11, 2009 (Bankr. D. Del. Case No. 09-11655) after reaching agreements with lenders holding a majority of the Company's secured debt. The Company's principal bankruptcy attorneys are Skadden, Arps, Slate, Meagher & Flom, LLP. Lazard Freres & Co., LLC, serves as the Company's financial advisors. AlixPartners, LLP, serves as the Company's restructuring advisors. The Garden City Group, Inc., serves as the Debtors' claims and notice agent. As of January 31, 2009, the Debtors had total assets of $1,336,600,000 and total debts of $1,405,200,000. This is the Company's second trip to the bankruptcy court, dubbed a Chapter 22, which was precipitated by an unprecedented slowdown in industry demand and a tightening of credit markets. HEALTHSOUTH CORP: Shares Initial Observation for 1st Qtr 2010 ------------------------------------------------------------- HealthSouth Corporation said it will participate in the Barclays Capital 2010 Global Healthcare Conference in Miami, Florida. The Company will share its initial observations on the first quarter of 2010. These observations are: * Volume: Strong December 2009 discharges created a steeper ramp up in January 2010. Heavy snow falls in February 2010 affected some markets. Volume growth through mid-month is on track for March 2010. * Expenses: Expense management has been better than expected in the first quarter of 2010, creating improvement over the first quarter of 2009. * Earnings: The Company reaffirms its 2010 guidance as presented discussed during its earnings conference call on February 23, 2010. A full-text copy of the company's presentation is available for free at http://ResearchArchives.com/t/s?5c10 About HealthSouth Birmingham, Alabama, HealthSouth Corporation (NYSE: HLS) -- http://www.healthsouth.com/-- is the nation's largest provider of inpatient rehabilitative healthcare services. Operating in 26 states across the country and in Puerto Rico, HealthSouth serves patients through its network of inpatient rehabilitation hospitals, long-term acute care hospitals, outpatient rehabilitation satellites, and home health agencies. As of December 31, 2009, the Company had total assets of $1.681 billion against total liabilities of $2.191 billion and convertible perpetual preferred stock of $387.4 million. HOLLYWOOD MOTION: Files Bankruptcy Exit Plan -------------------------------------------- Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports that The Hollywood Motion Picture and Television Museum on Tuesday filed its Chapter 11 plan of reorganization before the Bankruptcy Court in Los Angeles. According to Ms. Palank, the plan: -- calls for the completion of the museum's construction; -- aims to resolve a long-running legal dispute; -- promises to pay creditors in full; and -- hopes to put Ms. Reynolds' substantial collection on public view for the first time in more than 10 years. According to Ms. Palank, the museum warned that if that plan doesn't work out, it would liquidate, hiring an auction house to sell off Ms. Reynolds' collection until enough proceeds are generated to pay creditors. Ms. Palank recalls that Ms. Reynolds first opened the museum in a Las Vegas hotel in the early 1990s, but it closed in 1997 upon the hotel's bankruptcy filing. According to Ms. Palank, Ms. Reynolds won a spot in a new Hollywood development, slated to open in 2004. However, that deal didn't pan out, as the museum's lender said it would no longer fund the museum's construction, leaving the museum unable to build its space and pay the $1.6 million bridge loan it took out from another lender, Gregory Orman. Ms. Palank relates that loan eventually became the center of legal battles between the museum and Mr. Orman, who accused the museum of defaulting on the loan. While those battles waged, the museum signed another deal to anchor Belle Island Village, a proposed resort destination in Pigeon Forge, Tennessee. That, too, met with trouble, according to Ms. Palank, and eventually construction lender Regions Bank foreclosed on the unfinished development in 2009. Ms. Palank also relates that, according to the museum, Regions Bank in January 2010 agreed to sell Belle Island Village to Tennessee Investment Partners LLC for $19.5 million in a deal slated to close by March 31. The buyer is partially owned by Tennessee-based real estate investment firm Matisse Capital LLC and by Belle Island Village's original developer. Ms. Palank says the buyer intends to reinstate the museum as the development's anchor tenant and is promising to advance the museum enough cash to cover Mr. Orman's claim, including principal, non-default-rate interest and his attorneys' fees. About Hollywood Motion Picture Creston, California-based Hollywood Motion Picture and Television Museum -- http://www.hmpc.tv/-- is a California non-profit organization that actress Debbie Reynolds founded to build a museum for her collection of Hollywood memorabilia. It owns the artifacts of Hollywood's Golden Age that Ms. Reynolds collected over several decades. The Hollywood Motion Picture and Television Museum filed for Chapter 11 bankruptcy protection on June 12, 2009 (Bankr. C.D. Calif. Case No. 09-12311). Judge Robin Riblet presides over the case. Peter Susi, Esq. -- cheryl@msmlaw.com -- in Santa Barbara, California, serves as counsel to the Debtor. In its petition, the Debtor disclosed estimated assets of $10 million to $50 million; and estimated debts of $1 million to $10 million. Hollywood Motion Picture Trust filed for Chapter 11 bankruptcy on February 24, 2010 (Bankr. C.D. Calif. Case No. 10-10864) also before Judge Riblet. Peter Susi, Esq., also serves as counsel to the Trust. In schedules filed together with the petition, the Trust disclosed total assets of $5,261,474, and total debts of $5,556,944. HOVNANIAN ENTERPRISES: Stockholders Okay Amended Incentive Plan --------------------------------------------------------------- Hovnanian Enterprises Inc. held its 2010 Annual Meeting of Stockholders, at which the Company's stockholders approved certain amendments to the Company's Amended and Restated 2008 Hovnanian Enterprises, Inc. Stock Incentive Plan. The Compensation Committee of the Board of Directors of the Company and the Board of Directors of the Company have approved the Amended Plan, subject to the approval of the Company's shareholders. The Amended Plan, as approved, incorporates the following changes as compared to the existing Amended and Restated 2008 Hovnanian Enterprises, Inc. Stock Incentive Plan: * While the aggregate share reserve covered by the Amended Plan and the Company's Amended and Restated Senior Executive Short-Term Incentive Plan collectively do not reflect an increase, the Amended Plan allows the Company to satisfy equity awards granted under the Amended Plan by utilizing the shares available for issuance under the Bonus Plan, provided that any shares so utilized will reduce the number of shares available for issuance under the Bonus Plan; * The maximum number of shares for which Awards may be granted under the Amended Plan to any single participant thereunder during a fiscal year have been increased from 1,000,000 to 2,000,000; and * For performance awards granted under the Amended Plan that are denominated in shares, the annual maximum grant per participant under the Amended Plan during any fiscal year is 2,000,000 shares. The maximum amount payable in respect of a performance award that is not denominated in shares during a fiscal year to any participant under the Amended Plan remains equal to the greater of (x) $15,000,000 and (y) 2.5 percent (2.5%) of the Company's income before income taxes. In connection with the adoption of the Amended Plan, the Committee and the Board of Directors of the Company approved amendments to the Bonus Plan to allow the Company to satisfy awards granted under the Amended Plan by utilizing the shares available for issuance under the Bonus Plan, provided that any shares so utilized will reduce the number of shares available for issuance under the Bonus Plan. 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. INTERSTATE HOTELS: S&P Withdraws 'CCC+' Corporate Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings on Arlington, Va.-based Interstate Hotels & Resorts Inc. and Interstate Operating Co. L.P. On March 11, Interstate announced that shareholders had approved its merger with a joint venture between Thayer Lodging Group and Jin Jiang Hotels. The company will no longer publicly file financial statements. S&P withdrew its ratings at Interstate's request. Ratings List Ratings Withdrawn Interstate Hotels & Resorts Inc. To From -- ---- Corporate Credit Rating NR CCC+/Developing/-- Interstate Operating Co. L.P. To From -- ---- Secured Credit Facilities NR CCC+ Recovery Rating NR 4 NR -- Not rated. INSIGHT HEALTH: S&P Downgrades Rating on $315 Mil. Notes to 'CC' ---------------------------------------------------------------- On March 24, 2010, Standard & Poor's Ratings Services lowered its debt rating on Lake Forest, Calif.-based InSight Health Services Corp.'s $315 million ($293.5 million outstanding at Dec. 31, 2009) secured floating rate notes to 'CC' from 'CCC-', and the recovery rating to '6' from '5'. The recovery rating of '6' indicates S&P's expectations for negligible (0-10%) recovery (including six- months' interest) for the FRN noteholders in the event of default. Based on S&P's discrete asset liquidation analysis, S&P applied certain discount advance rates to the major asset classes based on asset values at Dec. 31, 2009. After applying these customary haircuts to these asset classes, S&P determined that its liquidation valuation scenario would likely result in an expectation of the same '6' recovery rating. Note that the unrated revolving credit facility is assumed to be fully drawn at default and ranks senior to the FRNs. Therefore, the expected recovery for the FRNs is after accounting for the senior position of the revolving credit facility as well as a modest amount of capital leases. S&P has lowered its recovery rating from its prior recovery analysis because of a decrease in asset values over the past 12 months. The low speculative-grade rating reflects InSight Health Services Corp.'s materially weaker-than-expected performance since its emergence from bankruptcy, and refinancing risk. InSight Health Services Holdings Corp. and its wholly owned subsidiary, InSight, emerged from bankruptcy on Aug. 1, 2007, and exchanged about $194 million of its notes for 90% of its common stock per its prepackaged plan of reorganization. Despite the reduction in debt at that time, debt leverage (adjusted for operating leases) has increased, to 8.7x at Dec. 31, 2009, from a low point of 5.9x for the 12 months ended Sept. 30, 2007, as a result of persistent operating challenges. The poor trajectory of the performance over the past few years decreases the probability of a refinancing of the debt due in November 2011. Ratings List InSight Health Services Corp. Corporate credit rating CCC/Negative/-- Ratings Lowered To From --------------- -- ---- $315 million senior secured notes CC CCC- Recovery rating 6 5 JAPAN AIRLINES: Establishes Compliance Investigation Panel ---------------------------------------------------------- Japan Airlines (JAL) has formed the Compliance Investigations Committee on March 2, 2010. As part of the Company's efforts in executing a fair and transparent restructuring, JAL has tasked the Committee to examine past business practices of the JAL Group. With the purpose of obtaining more information about compliance issues in the company's history, the Committee is asking anyone with relevant information to contact them by post, or by sending an email to a dedicated email address (please see below) by no later than April 15, 2010. Mailing address : Law office of Nishikohri & Miyama Compliance Investigations Committee Chiyoda-ku, Hirakawacho 1- 9 - 3 Kyosho Building 2nd Floor Tokyo 102-0093, Japan Email address : jal-chousa@abox3.so-net.ne.jp Closing date : April 15, 2010 (Thursday) About the Committee An independent investigative organization, the Committee is comprised of third-party members who can impartially provide professional opinion and effectively assess the JAL Group. Activities of the Committee and key findings in the course of their investigations will be disclosed and reported to the appointed Trustees of JAL, under the Corporate Reorganization Proceedings. Members of the Compliance Investigations Committee Position in Committee Name Background ----------- ---- ---------- Chairman Chiharu SAIGUCHI Lawyer, former member of the Supreme Court of Japan Vice chairman Tatsuo KAINAKA Former Superintending Prosecutor of the Tokyo High Public Prosecutors' Office, former member of the Supreme Court of Japan Member Shinsuke KUBO Certified public accountant Member Masaya Miyama Lawyer Member Kyoko UEMURA Lawyer, former judge About Japan Airlines Japan Airlines Corporation -- http://www.jal.co.jp/-- is a Japan-based company mainly engaged in the provision of air transport services. The Company is active in five business segments through its 203 subsidiaries and 83 associated companies. JAL International Co. Ltd. is a wholly owned operating subsidiary of Japan Airlines Corporation. Japan Airlines Corporation, Japan Airlines International Co., Ltd. and JAL Capital Co., Ltd., on January 19, 2010, filed the petitions to commenced corporate reorganization proceedings with the Tokyo District Court. The Court appointed the Enterprise Turnaround Initiative Corporation of Japan and Eiji Katayama, Esq., as reorganization trustees. Japan Airlines Corp. filed for reorganization January 19 in the Tokyo District Court and filed a Chapter 15 petition in New York (Bankr. S.D.N.Y. Case No. 10-10198). The Company said debt is $28 billion. Bankruptcy Creditors' Service, Inc., publishes Japan Airlines Bankruptcy News. The newsletter tracks the Chapter 15 proceedings and the bankruptcy proceedings in Tokyo undertaken by Japan Airlines Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) JAPAN AIRLINES: Releases January Traffic Data --------------------------------------------- Japan Airlines announced on March 9, 2010, their monthly traffic data for the month of January 2010. The Monthly Traffic Data consist of a (1.1) JAL Group International Passenger Traffic Data - FY2009, (1.2) Month International Passenger Route Traffic Data - January 2010, (2) JAL Group Total Domestic Passenger Traffic - FY2009, (3) JAL Group Cargo Traffic Data - FY2009, and (4) Monthly JAL Group Flight Operation Data - January 2010. A spreadsheet file of the January Monthly Traffic Data is available for free at: http://bankrupt.com/misc/JAL_JAN10TrafficData.xls About Japan Airlines Japan Airlines Corporation -- http://www.jal.co.jp/-- is a Japan-based company mainly engaged in the provision of air transport services. The Company is active in five business segments through its 203 subsidiaries and 83 associated companies. JAL International Co. Ltd. is a wholly owned operating subsidiary of Japan Airlines Corporation. Japan Airlines Corporation, Japan Airlines International Co., Ltd. and JAL Capital Co., Ltd., on January 19, 2010, filed the petitions to commenced corporate reorganization proceedings with the Tokyo District Court. The Court appointed the Enterprise Turnaround Initiative Corporation of Japan and Eiji Katayama, Esq., as reorganization trustees. Japan Airlines Corp. filed for reorganization January 19 in the Tokyo District Court and filed a Chapter 15 petition in New York (Bankr. S.D.N.Y. Case No. 10-10198). The Company said debt is $28 billion. Bankruptcy Creditors' Service, Inc., publishes Japan Airlines Bankruptcy News. The newsletter tracks the Chapter 15 proceedings and the bankruptcy proceedings in Tokyo undertaken by Japan Airlines Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) JAPAN AIRLINES: TWU Calls for Antitrust Immunity for AMR Deal ------------------------------------------------------------- The TWU called on the U.S. Department of Transportation to grant antitrust immunity for the joint business agreement proposed by American Airlines and Japan Airlines. The union represents workers at 23 U.S. airlines, including its American Eagle subsidiary. American and Japan airlines are part of the One World Alliance, which unites 11 global airlines on five continents. "The proposed alliance between the two carriers is vital for Oneworld to compete effectively with the Star and SkyTeam alliances," said TWU President James C. Little and Vice President John M. Conley, director of the union's Air Transport Division, in a letter delivered today to U.S. Transportation Secretary Ray LaHood. The application by American Airlines and Japan Airlines, Little and Conley wrote, "will benefit our members, their families, and communities in which they live, by providing: greater and balanced ability to compete . . . enhanced opportunity for long-term growth; improved job security; [and] consistent regulatory approval." American Airlines and Japan Airlines and the other partners in the Oneworld alliance are seeking the same privileges and antitrust immunities enjoyed for years by the competing Star Alliance and the SkyTeam alliance. In addition to the letter to LaHood, TWU will be communicating the union's position to members of Congress and encouraging TWU members to reach out to their elected representatives. TWU members supported the successful effort by American and its Oneworld alliance partners to apply for antitrust immunity for Atlantic routes last year. The U.S. Department of Transportation approved the application in February, 2010. About Japan Airlines Japan Airlines Corporation -- http://www.jal.co.jp/-- is a Japan-based company mainly engaged in the provision of air transport services. The Company is active in five business segments through its 203 subsidiaries and 83 associated companies. JAL International Co. Ltd. is a wholly owned operating subsidiary of Japan Airlines Corporation. Japan Airlines Corporation, Japan Airlines International Co., Ltd. and JAL Capital Co., Ltd., on January 19, 2010, filed the petitions to commenced corporate reorganization proceedings with the Tokyo District Court. The Court appointed the Enterprise Turnaround Initiative Corporation of Japan and Eiji Katayama, Esq., as reorganization trustees. Japan Airlines Corp. filed for reorganization January 19 in the Tokyo District Court and filed a Chapter 15 petition in New York (Bankr. S.D.N.Y. Case No. 10-10198). The Company said debt is $28 billion. Bankruptcy Creditors' Service, Inc., publishes Japan Airlines Bankruptcy News. The newsletter tracks the Chapter 15 proceedings and the bankruptcy proceedings in Tokyo undertaken by Japan Airlines Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) JOURNAL REGISTER: Shareholder Lacks Standing to Appeal Plan ----------------------------------------------------------- WestLaw reports that a former stockholder was not aggrieved by a debtor's Chapter 11 plan, and thus did not have standing to appeal the bankruptcy court's approval of the plan. The secured creditors were undersecured by more than $350 million, only recovered 42% of their claims, and would not have received full payment even if they had not adopted incentive and trade account distribution plans. The creditors voted overwhelming in favor of the plan. Freeman v. Journal Register Co., --- F.Supp.2d ----, 2010 WL 768942 (S.D.N.Y.). Yardley, Pennsylvania-based Journal Register Company (PINKSHEETS: JRCO) -- http://www.JournalRegister.com/-- owns 20 daily newspapers, more than 180 non-daily publications and operates over 200 individual Web sites that are affiliated with the Company's daily newspapers, non-daily publications and its network of employment Web sites. All of the Company's operations are strategically clustered in six geographic areas: Greater Philadelphia; Michigan; Connecticut; Greater Cleveland; and the Capital-Saratoga and Mid-Hudson regions of New York. The Company also owns JobsInTheUS, a network of 20 employment Web sites. Journal Register, along with its affiliates, filed for Chapter 11 bankruptcy protection on February 21, 2009 (Bankr. S.D.N.Y. Case No. 09-10769). Marc Abrams, Esq., Rachel C. Strickland, Esq., Shaunna D. Jones, Esq., and Jennifer J. Hardy, Esq., at Willkie Farr & Gallagher LLP, represent the Debtors as counsel. William M. Silverman, Esq., Scott L. Hazan, Esq., and Jeanette A. Barrow- Bosshart, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., represent the official committee of unsecured creditors as counsel. Conway, Del Genio, Gries & Co., LLC, provides restructuring management services to the Debtors. Robert P. Conway is the Company's chief restructuring officer. At the time of the filing, the Company estimated its assets at less than $500 million in and $500 million to $1 billion in total debts. Journal Register emerged from Chapter 11 protection under the terms of a pre-negotiated plan of reorganization declared effective in Aug. 2009. KEYSTONE AUTOMOTIVE: S&P Puts B- Corp. Credit Rating on Watch Neg. ------------------------------------------------------------------ Standard & Poor's Ratings Services said it placed its ratings on Exeter, Pa.-based automotive aftermarket specialty-equipment distributor Keystone Automotive Operations Inc., including its 'B-' corporate credit rating, on CreditWatch with negative implications. This means S&P could lower the ratings if S&P believes liquidity will remain below levels reported through most of 2009 or if S&P believes credit measures will remain extremely poor. As of Jan. 2, 2010, the company had about $392 million debt outstanding. "The CreditWatch placement reflects the company's reduced liquidity, weaker-than-expected sales and profitability, and extremely poor credit measures," said Standard & Poor's credit analyst Jerry Phelan, "including 20x leverage and 0.7x EBITDA interest coverage." Absent a meaningful improvement in profitability or an equity injection, it will likely be difficult for the company to eventually avoid some form of restructuring in advance of its January 2012 bank facility maturity. Note that S&P is not aware of any plans by the company or sponsor to address its capital structure. "S&P could lower the ratings if S&P believes the company will not be able to meaningfully improve sales, profitability, and credit measures," added Mr. Phelan, "or if S&P believes liquidity will remain below levels reported through most of 2009." However, if S&P believes the company will ultimately be able to improve liquidity and profitability and avoid a restructuring?potentially through improved performance or new equity capital-S&P could affirm the rating. KT TERRAZA: Section 341(a) Meeting Scheduled for April 22 --------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of creditors in KT Terraza I, LLC's Chapter 11 case on April 22, 2010, at 3:00 p.m. The meeting will be held at Room 2610, 725 S Figueroa Street, Los Angeles, CA 90017. 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. Los Angeles, California-based KT Terraza I, LLC, filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. C.D. Calif. Case No. 10-19693). Bernard D. Bollinger, Jr., Esq., at Buchalter Nemer, assists the Company in its restructuring effort. The Company listed $50,000,001 to $100,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. These affiliates of the Company filed separate Chapter 11 petitions: -- GTS Property Portfolio B-3, LLC (Case No. 09-14774) on March 3, 2009; and -- B3 FLJC, LLC (Case No. 10-19697) on March 16, 2010. B3 FLJC, LLC listed $50 million to $100 million in assets and $100 million to $500 million in liabilities. LAKE AT LAS VEGAS: Unsecureds to Receive 4.5% Under Plan -------------------------------------------------------- Bankruptcy Court for the District of Nevada a second amended Disclosure Statement in relation to the proposed amended Plan of Reorganization dated as of March 16, 2010. The plan proponents are the Debtors and the Official Committee of Unsecured Creditors in the Debtors' Chapter 11 cases. According to the amended Disclosure Statement, the Plan provides for the general unsecured creditors holding valid Class 7 Claims to receive 4.5% distribution on account of their claims from a $1 million fund. Additionally, the same unsecured creditors will receive up to 10% of the net proceeds recovered by the Creditors Trust. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/LakeatLasVegas_2ndAmendedDS.pdf About Lake at Las Vegas Headquartered in Henderson, Nevada, Lake at Las Vegas Joint Venture, LLC and 14 of its debtor-affiliates -- http://www.lakelasvegas.com/-- are owners and developers of 3,592-acre residential and resort destination Lake Las Vegas Resort in Las Vegas, Nevada. Centered around a 320-acre man-made lake, Lake Las Vegas contains more than 9,000 residential units, and also includes two luxury resort hotels (a Loews and a Ritz- Carlton), a casino, a specialty retail village shopping area, marinas, three signature golf courses and related clubhouses, and other real property. The Debtors filed separate petitions for Chapter 11 relief on July 17, 2008 (Bankr. D. Nev. Lead Case No. 08-17814). When Lake at Las Vegas Joint Venture, LLC, filed for protection from its creditors, it listed assets of $100 million to $500 million, and debts of $500 million to $1.0 billion. Courtney E. Pozmantier, Esq., Martin R. Barash, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP, Jason D. Smith, Esq., at Santoro, Driggs, Walch, Kearney, Holley & Thompson, Jeanette E. McPherson, Esq., Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, represent the Debtors as counsel. Kaaran E. Thomas, Esq., Ryan J. Works, Esq., at McDonald Carano Wilson LLP, represent the Official Committee of Unsecured Creditors as counsel. LANDMARK VALLEY: Can Borrow $60,000 for House Construction ---------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas authorized Landmark Valley Homes, Inc., to obtain debtor-in- possession financing from Inter National Bank. The Debtor related that it was unable to obtain unsecured creditor necessary to fund the completion of construction of houses. The lender expressed willingness to extend additional monies -- in the amount of $59,581 -- to the Debtor. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant INB liens, security interests and mortgages, equal in priority to the liens existing as of the petition date. McAllen, Texas-based Landmark Valley Homes, Inc., owns and operates residential construction/real estate development business. The Company filed for Chapter 11 bankruptcy protection on January 4, 2010 (Bankr. S.D. Tex. Case No. 10-70013). John Kurt Stephen, Esq., at Cardena Whitis and Stephen, assists the Company in its restructuring effort. The Company has assets of $34,119,790, and total debts of $19,484,476. LEHMAN BROTHERS: Examiner to Unveil Players in Lehman Auction ------------------------------------------------------------- According to Bankruptcy Law360, the court-appointed examiner in Lehman Brothers Holdings Inc.'s bankruptcy has asked for permission to reveal who participated in an auction for Lehman assets that allegedly resulted in a loss of $1.2 billion for the debtor, over the objection of CME Group Inc., which conducted the auction. 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: Settles Tax Disputes With IRS For $125M -------------------------------------------------------- Bankruptcy Law360 reports that Lehman Brothers Holdings Inc. has reached a settlement with the Internal Revenue Service that will provide the financial company with more than $125 million in refunded taxes and penalties that the company claimed it was owed. 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) LENOX CONDOMINIUM: Section 341(a) Meeting Scheduled for April 21 ---------------------------------------------------------------- The U.S. Trustee for Region 2 will convene a meeting of creditors in The Lenox Condominium LLC's Chapter 11 case on April 21, 2010, at 2:30 p.m. The meeting will be held at Office of the United States Trustee, 80 Broad Street, Fourth Floor, New York, NY 10004-1408. 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. New York-based The Lenox Condominium LLC filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. S.D.N.Y. Case No. 10-11391). Robert R. Leinwand, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck P.C., assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. LINN ENERGY: S&P Affirms Corporate Credit Rating at 'B+' -------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B+' corporate credit on Houston-based independent exploration and production firm Linn Energy LLC. At the same time, S&P raised its issue- level ratings on the company's unsecured debt to 'B' from 'B-', one notch lower than the corporate credit rating. S&P revised the recovery rating on this debt to '5', indicating its expectation of modest (10%-30%) recovery in the event of a payment default, from '6'. Finally, S&P assigned a 'B' issue-level rating on the company's proposed $500 million senior unsecured notes. The recovery rating on the notes is '5', indicating S&P's expectation of modest (10%-30%) recovery in the event of a payment default. The rating outlook is stable. Linn Energy will acquire natural gas-focused assets in the Antrim Shale of Michigan for $330 million from HighMount. The acquisition is in line with the company's strategy of acquiring long-life, low-decline reserves. The properties have more than 266 billion cubic feet equivalent of proved reserves, of which 85% was proved developed and 99% is natural gas. In addition, the company announced an offering of $500 million of senior notes and the issue of 15 million common units for around $360 million prior to underwriters options. It plans to use proceeds from the offerings to repay a portion of the outstanding amount under its revolving credit facility, fund the HighMount acquisition, and unwind certain interest rate derivative contracts. S&P considers the HighMount acquisition and debt and equity transactions to be consistent with its expectations for Linn Energy. The HighMount acquisition adds low risk, long-lived, producing reserves to Linn Energy's portfolio, and it is financed largely with the proposed equity offering. Linn Energy will use the proposed $500 million note offering to repay outstanding borrowings on the credit facility, freeing liquidity for further acquisitions or capital spending. S&P's ratings on Linn Energy reflect the company's midsize reserve base, aggressive financial leverage, and substantial quarterly distributions paid to unitholders. The low geological risk inherent in the company's reserve base, balanced production mix between natural gas and liquids, and substantial commodity price hedges partially offset these weaknesses. Linn Energy is a limited liability company. However, it resembles a master limited partnership in several ways, and S&P generally refer to the company as an E&P MLP. Most notably, Linn Energy pays out substantially all available cash flow to unitholders on a quarterly basis, and equity investors tend to value the company on a yield basis. Unlike an MLP, there is neither a general partnership interest nor incentive distribution rights. LIONS GATE: S&P Puts 'B-' Corp. Rating on CreditWatch Negative -------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B-' corporate credit rating for British Columbia, Canada-domiciled and Santa Monica, Calif.-headquartered Lions Gate Entertainment Corp. and its subsidiary, Lions Gate Entertainment Inc., along with all related issue-level ratings, on CreditWatch with negative implications. "The CreditWatch listing is in response to the announcement of an unsolicited tender offer from Carl Icahn to acquire all outstanding shares of Lions Gate's common stock," said Standard & Poor's credit analyst Deborah Kinzer. 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. In addition, an acquisition of more than 50% of common shares would require the company to repurchase its senior secured second-priority notes and its convertible senior subordinated notes. The company has already instituted a shareholder rights plan ("poison pill" defense), on which shareholders will vote at a special meeting on May 4. This will provide an indication of equity investor support for current management and the board. However, there is also the risk that the company could take other actions to fend off Mr. Icahn's efforts, which could, in S&P's view, cause its credit measures to deteriorate from their already weak levels. In resolving S&P's CreditWatch listing, S&P will assess the outcome of the takeover attempt and its effect on Lions Gate's credit measures and financial policy. S&P could lower the rating if the company takes actions that cause its credit measures to deteriorate from their already weak levels, or if the tender offer succeeds and it appears unlikely that the banks and bondholders will grant a waiver. S&P could also downgrade the rating if the company takes steps that raise its debt leverage further above already high levels, such as a significant debt-financed acquisition. LOCAL TV: S&P Retains 'B-' Rating on First-Lien Credit Facilities ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its recovery rating on Local TV Finance LLC's first-lien credit facilities to '3', indicating S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default, from '4'. The 'B-' issue-level rating on this debt remains unchanged. The 'B-' corporate credit rating on Covington, Kentucky-based Local TV LLC and its Local TV Finance subsidiary, along with all related issue-level ratings, were affirmed. The rating outlook is stable. "The recovery rating revision reflects a change to S&P's estimated EBITDA at default and emergence valuation under its simulated default scenario," explained Standard & Poor's credit analyst Jeanne Shoesmith. Although S&P's assumed distressed EBITDA multiple is unchanged at 6x, the change to its default EBITDA assumption resulted in a higher gross emergence enterprise value than in its previous analysis. The 'B-' corporate credit rating reflects Local TV LLC's thin liquidity, high debt leverage, and sensitivity to election cycles, as well as TV broadcasting's mature revenue growth prospects. Local TV operates nine TV stations in eight midsize markets ranked from No. 43 (Norfolk, Va.) to No. 100 (Fort Smith, Ark.). The company's stations are affiliated primarily with CBS, ABC, and NBC. Some revenue concentration exists, with CBS-affiliated stations accounting for about half of broadcast cash flow. Sensitivity to political ad spending is high, and the company's EBITDA can drop by roughly 25% in typical nonelection years. S&P expects that 2009 results will include an EBITDA decline in the 25% to 30% range from continued recessionary pressures on advertising spending, on top of a decline in political advertising. The station group's EBITDA margin of 26.9% for the 12 months ended Sept. 30, 2009 is near the middle of its peer group's. However, the EBITDA margin has declined nearly 600 basis points from the prior-year period due to declines in revenue exceeding cost-cutting measures. EBITDA coverage of interest was very low, at 1.4x for the 12 months ended Sept. 30, 2009. In the 2008 fourth quarter, the company elected to accrue interest on its $196 million senior notes, which have a pay-in-kind toggle feature that allows the company to accrue interest at a 75-basis-point premium rather than paying in cash. The PIK feature saves the company about $20 million in cash interest expense and provides some near-term flexibility. EBITDA coverage of cash interest is stronger at 2.1x, benefiting from the PIK feature of the senior notes. S&P is concerned that EBITDA coverage of interest may remain thin into 2011, when the company is required to resume cash interest payments on the notes. Debt to EBITDA was very high, at 11.8x for the 12 months ended Sept. 30, 2009. S&P expects year-end results will show that leverage reached 12.5x by the end of 2009 due to a lack of meaningful political revenue and debt rising as a result of the company's decision to accrue interest on the senior notes. Although S&P expects trends to moderate in 2010, with political revenue picking up in the second half of the year, S&P believes that leverage will remain high, in the low double digits. LUXURY VENTURES: Payment to Landlord Wasn't Preferential -------------------------------------------------------- WestLaw reports that a prepetition payment made by a Chapter 11 debtor-tenant to its landlord was rent paid in the ordinary course of business between the debtor and the landlord, rather than pursuant to an agreement providing for the subsequent termination of the debtor's lease. Therefore, the payment was excepted from the liquidating trustee's preference avoidance powers under the ordinary course of business defense. In re Luxury Ventures, LLC, --- B.R. ----, 2010 WL 768736 (Bankr. M.D. Fla.). About Luxury Ventures Bonita Springs, Florida-based Luxury Ventures LLC does business as Henricks Jewelers and sells and retails jewelries. It filed for chapter 11 bankruptcy on Nov. 19, 2007 (Bankr. M.D. Fla. Case No. 07-11224). Judge Alexander L. Paskay presides the case. Paul J. Battista, Esq., at Genovese, Joblove & Battista PA represents the Debtor in its restructuring efforts. When the Debtor filed for bankruptcy, it listed $1 million to $100 million in assets and debts. Luxury Ventures LLC emerged from Chapter 11 in August 2008 under a plan of reorganization in which Kairos Capital Partners made an equity investment in the company in exchange for an ownership stake. LYONDELL CHEMICAL: Parent Prices $2.275-Bil. Sr. Secured Notes -------------------------------------------------------------- LyondellBasell priced approximately $2,750 million of senior secured notes due 2017 in a private placement under Rule 144A and Regulation S. The senior secured notes are comprised of $2,250 million of 8 percent senior secured notes and EUR375 million of 8 percent senior secured notes (the "euro notes"), both issued at par, maturing in 2017. The closing of the issuance of the notes is scheduled for April 8, 2010. The notes will be issued by LBI Escrow Corporation, which will merge with and into Lyondell Chemical Company in connection with Lyondell Chemical's emergence from bankruptcy, which is expected to occur on or about April 30, 2010, subject to confirmation of a Plan of Reorganization. LyondellBasell entities also are arranging a senior term loan facility of approximately $500 million and a $1,750 million asset- based revolving credit facility for working capital and general corporate purposes. Proceeds of the notes offering and term loan will be placed in escrow until the approval of the Plan of Reorganization. The net proceeds from the sale of the notes, together with borrowings under the term loan and a new European securitization facility and proceeds from a $2,800 million rights offering, will be used upon emergence from bankruptcy to repay and replace certain existing debt, including debtor-in-possession credit facilities and an existing European securitization facility and to make certain related payments. Upon emergence from bankruptcy, the notes and term loan will be senior secured obligations of Lyondell Chemical and will be guaranteed by LyondellBasell Industries N.V. and, subject to certain exceptions, substantially all wholly owned U.S. restricted subsidiaries of LyondellBasell Industries N.V. The notes and the guarantees of the notes will not be registered under the Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements. The notes are offered only to "qualified institutional buyers" in accordance with Rule 144A under the Securities Act and to non-"U.S. persons" in accordance with Regulation S under the Securities Act. 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. 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. 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) MAGUIRE PROPERTIES: Posts $335.9-Mil. Net Loss for Dec. 31 Qtr. --------------------------------------------------------------- Maguire Properties Inc. reported results for the quarter ended December 31, 2009. The Company reported a net loss of $335.9 million on $119.3 million of l revenue for the three months ended December 31, 2009, compared with a net loss of $91.5 million on $124.1 million of total revenue for the same period a year ago. The Company's balance sheet at Dec. 31, 2009, revealed $3.6 billion in total assets and $4.5 billion in total liabilities for a $856.9 million total stockholders' deficit. Impairment During the fourth quarter, the Company recorded impairment charges totaling $290.3 million, of which $264.3 million has been recorded as part of continuing operations and $26.0 million as part of discontinued operations. Of the $264.3 million impairment charge recorded in continuing operations, $99.9 million was related to the writedown of Griffin Towers and 2385 Northside to their estimated fair value as of December 31, 2009. The remaining $164.4 million impairment charge recorded in continuing operations was the result of an impairment analysis performed as of December 31, 2009, which resulted in certain properties being written down to fair value. The $26.0 million impairment charge recorded in discontinued operations was related to the disposition of Lantana Media Campus. A full-text copy of the Company's earnings release is available for free at: http://ResearchArchives.com/t/s?5c11 A full-text copy of a document containing supplemental operating and financial data is available for free at: http://ResearchArchives.com/t/s?5c12 About Maguire Properties, Inc. Maguire Properties, Inc. (NYSE: MPG) -- http://www.maguireproperties.com/-- is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high-quality office properties in the Southern California market. Maguire Properties, Inc. is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. Maguire posted a net loss of $48.58 million on total revenue of $126.32 million for the quarter ended September 30, 2009, from a net loss of $67.75 million on total revenue of $123.86 million for the same period a year ago. The Company posted a net loss of $533.80 million on total revenue of $378.06 million for the nine months ended September 30, 2009, from a net loss of $231.79 million on total revenue of $379.24 million the prior year. At September 30, 2009, Maguire had $4.17 billion in total assets against $4.69 billion in total liabilities. MAMMOTH CORONA: Amended Plan Outline Hearing Set for April 21 ------------------------------------------------------------- The Hon. Robert N. Kwan of the U.S. Bankruptcy Court for the Northern District of Illinois will consider at a hearing on April 21, 2010, at 2:00 p.m., the approval of a disclosure statement explaining Mammoth Corona 1 LLC's proposed Plan of reorganization. The hearing will be held at Ronald Reagan Federal Bldg 411 W Fourth St. Courtroom 5D, Santa Ana, California. The Debtors will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the amended Disclosure Statement, the Plan seeks to accomplish payment under the Plan primarily through the cash flow generated from the leasing of the Mammoth Property and through proceeds from a future sale or refinance of the Mammoth Property. In addition there is a $300,000 New Value contribution from the Interest Holders to cover any shortfalls in payments due under the plan. Under the Plan, the Debtor will restructure one note held by U.S. Bank and converting, mechanics liens to deeds of trust, and contributing $300,000 in New Value to cover any debt service shortfalls. Secured creditors of the estate will be paid the present value of their claim at a market interest rate over a 42 month period, excepting that their claims may be paid in full prior to the 42nd month through a sale or refinance of the Mammoth Property. The Effective Date of the proposed Plan is June 15, 2010. The distributions under the Plan will be made from the $300,000 New Value contribution, the potential additional New Value Contribution to pay any Class 1 deficiency, available cash, cash flow from operations, refinance proceeds and net sale proceeds. Holders of general unsecured claim will be paid over 42 months beginning at $42 per month on 100% of a principal balance of $26,319 or Class 3 Claimants may elect to receive 50% of their claim 12 months after the effective date as payment in full. Interest holders will receive the pro rata share of monies available after payment to classes 1, 2,and 3 based upon each Class 4 claimants percentage interest in the Reorganized Debtor, which will be the same as their percentage interest in the Debtor. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/MAMMOTHCORONA_AmendedDS.pdf About Mammoth Corona 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: Cash Collateral Hearing Slated for April 21 ----------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois will consider at a hearing on April 21, 2010, at 2:00 p.m., Mammoth Corona 1 LLC's access to the rents generated by its primary asset, a real property located at 4740 Green River Road, Corona, California. The hearing will be held at Ronald Reagan Federal Bldg 411 W Fourth St. Courtroom 5D, Santa Ana, California. As reported in the Troubled Company Reporter on March 10, 2010, the real property rents are subject only to the security interest of the secured lender U.S. Bank, N.A. The Debtor would use the money to fund its business operations. U.S. Bank has not consented to the Debtor's cash collateral use. The Debtor said 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. MAXIM CRANE: Moody's Assigns Corporate Family Rating at 'B3' ------------------------------------------------------------ Moody's Investors Service has assigned a B3 corporate family rating and a B3 probability of default rating to Maxim Crane Works, L.P. Concurrently, Moody's has assigned a Caa1 to the company's new $250 million second lien notes due 2015 and a stable ratings outlook. The ratings balance Maxim's well established position as one of the largest crane rental companies in the United States against the still weak prospects for new non-residential construction spending that would drive new demand for crane rentals. The company's competitiveness benefits from a relatively young fleet and an ability to move its cranes throughout much of the United States to meet demand. Nevertheless, until business begins to improve the company's credit metrics are unlikely to improve materially over the short term due to tough demand. The number of large projects where cranes are needed has declined due to economic conditions and slow market place absorption of completed projects. Weak crane demand has also pressured hourly rates and margins. The Caa1 rating on the company's second lien notes reflects their second priority status after a relatively large first lien facility. The stable outlook reflects the view that the company's financial performance will continue to be hindered by its leveraged capital structure, low interest coverage, and weak demand and pricing for rental equipment for much of 2010. Moody's currently anticipates that the rate of improvement in the company's credit metrics will be relatively slow. The ratings may benefit if demand for crane rentals strengthens leading to a meaningful improvement in the company's fleet rental rates and utilization. EBITA coverage of interest over 1.5 times would be supportive of positive ratings traction while EBITA coverage of interest under 0.8 times could cause ratings pressure. Assignments: Issuer: Maxim Crane Works, L.P. -- Probability of Default Rating, Assigned B3 -- Corporate Family Rating, Assigned B3 -- Senior Secured Regular Bond/Debenture, Assigned a range of 77 - LGD5 to Caa1 Outlook Actions: Issuer: Maxim Crane Works, L.P. -- Outlook, Stable This is an initial rating assignment for Maxim. Maxim Crane Works Holdings, Inc., headquartered in Bridgeville, Pennsylvania, is a holding company conducting its operations through Maxim Crane Works, L.P. LTM revenues through December 31, 2009, totaled $$333 million. MAXIM CRANE: S&P Assigns Corporate Credit Rating at 'B' ------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Pittsburgh, Pa.-based Maxim Crane Works L.P. At the same time, Standard & Poor's assigned a 'B' issue-level rating to the company's proposed new $250 million senior secured second- lien notes due 2015, the same as the corporate credit rating. The recovery rating on this debt is '4', indicating S&P's expectation of average (30%-50%) recovery a payment default scenario. S&P expects the company to use the proceeds to repay a portion of its balance under its existing asset-based loan revolving credit facility, and to fund a $100 million dividend to its equity sponsor Platinum Equity. The ratings on Maxim reflect its highly leveraged financial risk profile, characterized by high debt levels and aggressive financial policy. The company's weak business risk profile as a leading crane equipment rental company only partially offsets these factors. Maxim's weak business risk profile primarily reflects its participation in the cyclical, highly competitive, and fragmented crane rental industry. Its presence as the largest and only coast-to-coast provider of cranes and lifting equipment rentals in North America tempers this factor. The outlook is stable. Standard & Poor's expects the company to operate within credit measures commensurate for the rating over the business cycle. "However, S&P could lower the ratings if a worse-than-expected market downturn and/or debt-financed activities adversely affect liquidity or result in a meaningful deterioration of credit measures," said Standard & Poor's credit analyst Helena Song. "Conversely, if the long-term competitiveness of Maxim's business remains healthy, and if the company's credit measures (including debt to EBITDA in the 4x-5x range), liquidity, and financial policies, support this trend, S&P could raise the ratings on the company," she continued. MAXKO PETROLEUM: Trustee Wins $1.1 Mil. from Defaulting Bidders --------------------------------------------------------------- WestLaw reports that the defaulting bidders at a bankruptcy auction of a debtor's property did not reasonably or justifiably rely upon the purported misrepresentations by the debtor and the auction company regarding what assets were being sold. Therefore, the bidders were not fraudulently induced, as the high bidder and back-up bidder, to enter into the purchase contracts under Florida law. The debtor and auction company made numerous disclaimers regarding the accuracy of the information being provided, and the bidders were sophisticated parties who should have been aware of the risks inherent in such sales and of the issues that they needed to investigate prior to the sale. In re Maxko Petroleum, LLC, --- B.R. ----, 2010 WL 841365 (Bankr. S.D. Fla.) (Olson, J.). Maxko Petroleum LLC was the owner of property and improvements in Sunrise, Florida, on which was operated a Chevron gas station, convenience store and pizza restaurant. Maxko sought chapter 11 protection (Bankr. S.D. Fla. Case No. 08-14652) on April 16, 2008. At the time of the filing, the Debtor estimated its assets at less than $50,000 and its debts at $1 million to $10 million. At Regions Bank's behest, the Bankruptcy Court converted Maxko's chapter 11 case to a Chapter 7 liquidation on Oct. 8, 2008, and Sonya L. Salkin was appointed as the Chapter 7 Trustee. Following her appointment, Ms. Salkin set up an auction process to sell the Debtor's assets and held an auction, but the high bidder and backup bidder didn't consummate the sale transaction. After reviewing the dispute, Judge Olson awarded the Trustee $1.1 million in damages resulting from the bidders' defaults. MDRNA INC: KPMG Raises Going Concern Doubt ------------------------------------------ On March 23, 2010, MDRNA, Inc., filed its annual report on Form 10-K for the year ended December 31, 2009. KPMG LLP, in Seattle, Washington, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of the Company's recurring losses, recurring negative cash flows from operations, and accumulated deficit. The Company reported a net loss of $8.0 million on $14.7 million of revenue for the year ended December 31, 2009, compared with a net loss of $59.2 million on $2.6 million of revenue for 2008. The Company's balance sheet as of December 31, 2009, showed $7.2 million in assets and $14.1 million of debts, for a stockholders' deficit of $6.9 million. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c1d Bothell, Wash.-based MDRNA, Inc. is a biotechnology company focused on the discovery, development and commercialization of pharmaceuticals based on RNA interference ("RNAi"). MERVYN'S LLC: Target Losses Bid to Dismiss Creditors' Lawsuit ------------------------------------------------------------- Peg Brickley at Dow Jones Newswires reports that Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware denied a bid by Target Corp. to dismiss a lawsuit over its role in the sale of the Mervyn's department-store chain. According to Dow Jones, Target said it was immune from the suit because it sold its stock in Mervyn's in the deal, erecting a barrier against liability for what happened next. Judge Gross, however, rejected the argument and said each stage of the sale transaction, up to and including the allegedly overpriced leases, was a single deal not protected by the securities safe harbor provision of the U.S. Bankruptcy Code. Dow Jones recalls Mervyn's landed in bankruptcy in 2008, nearly four years after Target sold Mervyn's to Cerberus Capital Management LP, Sun Capital and other investors for $1.25 billion. Unpaid creditors sued more than three dozen entities connected to the deal, including Target, Sun and Cerberus. Dow Jones relates that lawyers for Mervyn's creditors said the deal was designed to defraud them by stripping the department store's valuable real estate from the retailing operation. Dow Jones recalls Target was paid and the investors profited from the 2004 transaction, which left Mervyn's retailing operation on the hook to pay for the deal. Mervyn's was forced to make allegedly overpriced lease payments on stores it once owned to a separate company that's now owned by the private-equity firms. Dow Jones also reports that according to the creditors' lawsuit, Mervyn's real estate payments proved too much for the Company, which was left with $22 million in working capital and saddled with $800 million in debt. According to Dow Jones, a Target spokesman said the company's conduct in the sale "was completely proper," adding "we expect to prevail" during trial. About Mervyn's LLC Headquartered in the San Francisco Bay Area, Mervyn's LLC -- http://www.mervyns.com/-- provided a mix of top national brands and exclusive private labels. Mervyn's had 176 locations in seven states. Mervyn's stores have an average of 80,000 retail square feet, smaller than most other mid-tier retailers and easier to shop, and are located primarily in regional malls, community 100 shopping centers, and freestanding sites. The Company and its affiliates filed for Chapter 11 protection on July 29, 2008 (Bankr. D. Del. Lead Case No. 08-11586). Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis & Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi, Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at Richards Layton & Finger P.A., represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The Debtors' financial advisor is Miller Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30, 2008, showed $665,493,000 in total assets and $717,160,000 in total liabilities resulting in a $51,667,000 total stockholders' deficit. In October 2008, Mervyn's disclosed its plans to close all stores and wind down its assets. The official committee of unsecured creditors proposed a conversion of the case to Chapter 7. METALS USA: Plans to Raise $200,000,000 in IPO ---------------------------------------------- Metals USA Holdings Corp. has filed with the Securities and Exchange Commission an amended registration statement in connection with its plan to offer $200,000,000 of common stock in an initial public offering. According to Metals USA, no later than 60 days following receipt of the proceeds of the offering, the Company will make an offer to all holders of its senior floating rate toggle notes due 2012, including its affiliates, to repurchase the maximum principal amount of the notes that may be purchased out of the net proceeds of the offering, at a price equal to 100% of the principal amount, plus accrued and unpaid interest to the date of the closing of the repurchase offer. If the net proceeds of the offering are greater than the purchase price of the notes tendered by holders, the Company will use the balance of the net proceeds, if any, for general corporate purposes. The Underwriters to the IPO are: * Goldman, Sachs & Co.; * Credit Suisse Securities (USA) LLC; * J.P. Morgan Securities Inc.; * Morgan Stanley & Co. Incorporated; * Jefferies & Company, Inc.; * Moelis & Company LLC; * Lazard Capital Markets LLC; * KeyBanc Capital Markets Inc.; and * Dahlman Rose & Company, LLC Goldman Sachs will act as the representative of the underwriters. A full-text copy of the Company's AMENDMENT NO. 7 TO THE FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 is available at no charge at http://ResearchArchives.com/t/s?5c1a About Metals USA Based in Houston, Texas, Metals USA Holdings Corp. -- http://www.metalsusa.com/-- provides a wide range of products and services in the heavy carbon steel, flat-rolled steel, non-ferrous metals, and building products markets. Metals USA reported $627.8 million in total assets and $671.5 million in total liabilities, resulting to a stockholders' deficit of $43.7 million as of December 31, 2009. * * * As reported by the Troubled Company Reporter on April 15, 2009, Standard & Poor's Ratings Services lowered its corporate credit ratings on Metals USA Holdings Corp. and on its wholly owned subsidiary, Metals USA Inc., to 'CCC+' from 'B-'. At the same time, S&P lowered its rating on the senior secured notes and the senior unsecured pay-in-kind toggle notes to 'CCC-' from 'CCC'. METRO-GOLDWYN-MAYER: Lions Gate Drops Out of Bidding ---------------------------------------------------- The Wall Street Journal's Lauren A. E. Schuker reports that people close to Lions Gate Entertainment Corp. said the film outfit on Thursday indicated it would drop out of the auction for Metro- Goldwyn-Mayer Inc. Ms. Schuker relates Lions Gate last week offered between $1.3 billion and $1.4 billion for MGM. Sources told the Journal that after MGM indicated that it found the offer insufficient and was preparing to ask for a higher bid, Lions Gate decided not to submit another offer. Time Warner Inc. and Len Blavatnik's Access Industries are the remaining suitors for MGM. The Troubled Company Reporter, citing The Wall Street Journal's Mike Spector and Ms. Schuker, reported on Thursday that hedge funds controlling big chunks of MGM's bank debt signaled Wednesday an unwillingness to sell for a lowball price. According to the TCR, people familiar with the matter have told the Journal that MGM has received only three bids, all at roughly $1.5 billion or less. Creditors had been hoping for a figure of around $2 billion. The Journal said over the past few months, several hedge funds have bought into the studio's bank debt at around 60 cents on the dollar. According to the Journal, those investments imply the studio is worth about $2.4 billion, well above what current suitors are bidding. Sources told the Journal at least $1 billion of MGM's bank debt is now held by a small group of hedge funds. Those sources said the largest holders are Anchorage Advisors and Highland Capital Management. The sources also said Apollo Global Management holds a small piece of MGM's debt. The Journal also said many of the hedge funds sit on a steering committee that is negotiating with MGM and its advisers. The two camps met Tuesday to discuss MGM's most recent bids and are set to convene again next week to continue discussing a standalone plan, according to the Journal. Also citing the Journal, the TCR reported Thursday that MGM has asked its lenders to grant leniency on debt payments until mid-May 2010 as it continues to work on backup restructuring plans that would hand control to creditors. The Journal said the creditors' willingness to take control of MGM could be their move to inject more competition into the bidding process and fetch higher prices for the studio. According to the TCR on March 10, 2010, people familiar with the matter told The Wall Street Journal that MGM is readying a backup plan should bids for its assets come in too low. 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. MGM has hired investment bank Moelis & Company and the law firm Skadden, Arps, Slate, Meagher & Flom. In August, it hired the restructuring expert Stephen F. Cooper to help lead the company. Among the potential bidders for a restructuring-oriented deal are Qualia Capital, an investment firm with film industry veterans. MGM is facing a March 31 deadline for its bank debt and an April 8 deadline for a $250 million credit facility. 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. METRO-GOLDWYN-MAYER: Creditors Say Current Offers Too Low --------------------------------------------------------- Metro-Goldwyn-Mayer Inc.'s creditors are unwilling to accept current offers for the film studio that they deem too low, Bloomberg News reported, citing a person with knowledge of the group's deliberations. According to the report, lenders will keep evaluating options and are open to higher bids than those made to date MGM's auction. Bloomberg, citing an unidentified person, relates that Time Warner Inc. offered $1.5 billion. Billionaire Len Blavatnik's Access Industries proposed to reduce MGM's debt and provide cash for film production. Lions Gate Entertainment Corp. said it dropped out of the bidding this week. Liberty Media Corp. and Elliott Management Corp. are also out of the bidding. MGM put itself up for sale last year after failing to make payments on $3.7 billion in debt. The Wall Street Journal reported early this month that MGM is readying a backup plan should bids for its assets come in too low. 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. MGM has hired investment bank Moelis & Company and the law firm Skadden, Arps, Slate, Meagher & Flom. In August, it hired the restructuring expert Stephen F. Cooper to help lead the company. Among the potential bidders for a restructuring-oriented deal are Qualia Capital, an investment firm with film industry veterans. MGM is facing a March 31 deadline for its bank debt and an April 8 deadline for a $250 million credit facility. 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. MIDWAY GAMES: Receives Approval of Disclosure Statement ------------------------------------------------------- Midway Games Inc. received approval of the disclosure statement explaining its proposed Chapter 11 plan. Midway Games will now be sending solicitation packages to voting creditors. A hearing on confirmation of the plan is scheduled for 2:00 p.m. May 21. Objections are due 4 p.m. on May 7. The Plan will be funded by the proceeds previously generated from the Debtors' ongoing operations, together with the proceeds generated from asset sales. The Plan will implement the settlement among members of the Official Committee of Unsecured Creditors. Under the settlement, unsecured creditors with claims against Midway Games (Class 3A) and the subsidiaries (Class 3B) will have their pro rata share of the $34.67 million estimated "Net Distribution Value". Holders of claims in Class 3A aggregating $154.82 million will recover 16.5% based on the class's share of $25.5 million of NDV. Holders of claims in Class 3B aggregating $36.66 million will recover 25%. As part of the settlement, holders of NAI Subordinated Claims, which are subordinated to the claims of noteholders in class 3A, won't recover anything. Equity holders won't recover anything. Holders of secured claims will recover cash equal to the amount of their secured claims or will recover the collateral securing their claims. About Midway Games Headquartered in Chicago, Illinois, Midway Games Inc. (OTC Pink Sheets: MWYGQ) -- http://www.midway.com/-- was a leading developer and publisher of interactive entertainment software for major videogame systems and personal computers. The Company and nine of its affiliates filed for Chapter 11 protection on February 12, 2009 (Bankr. D. Del. Lead Case No. 09-10465). Michael D. DeBaecke, Esq., Jason W. Staib, Esq, and Victoria A. Guilfoyle, Esq., at Blank Rome LLP, in Wilmington, Delaware; and Marc E. Richards, Esq., and Pamela E. Flaherty, Esq., at Blank Rome LLP, in New York, represent the Debtors in their restructuring efforts. Attorneys at Milbank, Tweed, Hadley & McCloy LLP and Richards, Layton & Finger, P.A. represent the official committee of unsecured creditors as counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims, noticing, and balloting agent. On July 10, 2009, Midway and certain of its U.S. subsidiaries completed the sale of substantially all of their assets to Warner Bros. Entertainment Inc. in a sale approved by the Court. The aggregate gross purchase price is roughly $49 million, including the assumption of certain liabilities. Midway is disposing of its remaining assets. At June 30, 2009, the Debtors had $1.39 billion in total assets and $1.59 billion in total liabilities. MOVIE GALLERY: To Pay $7.8-Mil. of Hollywood Studios' Claims ------------------------------------------------------------ Erik Gruenwedel at Home Media Magazine reports that the U.S. Bankruptcy Court in Richmond, Virginia, authorized Movie Gallery to pay $7.8 million in prepetition claims, including partial revenue-sharing amounts due, to Paramount Home Entertainment, Sony Pictures Home Entertainment, Universal Studios Home Entertainment, 20th Century Fox Home Entertainment and distributor VPD. The Court authorized the payments in an effort to continue studio shipments of DVD and Blu-ray Disc titles to operating Gallery and Hollywood Video locations, according to report. Warner Home Video owed more than $9.5 million was not included in the list, notes Mr. Gruenwedel. 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. MPC COMPUTERS: Gateway Loses Bid to Force Chapter 7 Conversion -------------------------------------------------------------- Bankruptcy Law360 reports that a bankruptcy judge has denied Gateway Inc.'s request for the conversion of the Chapter 11 case of MPC Computers LLC into Chapter 7 liquidation. Gateway wanted the conversion so it could collect on the nearly $16 million MPC allegedly owes, according to Law360. Headquartered in Nampa, Idaho, MPC Corporation -- http://www.mpccorp.com-- sells personal computer and provides computer software and hardware to mid-size businesses, government agencies and education organizations. MPC acquired Gateway Professional Divison from Gateway Inc. and Gateway Technologies Inc. in October 1, 2007. MPC and eight of its affiliates filed for Chapter 11 protection on November 6, 2008 (Bankr. D. Del. Lead Case No. 08-12667). Richard A. Robinson, Esq., at Reed Smith LLP, represents the Debtors in their restructuring efforts. The Debtor selected Focus Management Group USA, LLC, as its financial advisors. The United States Trustee appointed seven members to the Official Committee of Unsecured Creditors on November 25, 2008. Hahn & Hessen LLP represents the Committee. As of June 30, 2008, the Debtors have $258.3 million in total assets and $277.8 million in total debts MSGI SECURITY: Enable Capital Holds 9.99% of Common Stock --------------------------------------------------------- Enable Capital Management, LLC; Enable Growth Partners, L.P.; and Mitchell S. Levine disclosed that as of December 31, 2009, they may be deemed to hold in the aggregate 4,710,761 shares or roughly 9.99% of the common stock of MSGI Security Solutions, Inc. About MSGI Security MSGI Security Solutions, Inc. (Other OTC: MSGI) -- http://www.msgisecurity.com/-- is a provider of proprietary solutions to commercial and governmental organizations. The Company is developing a global combination of innovative emerging businesses that leverage information and technology. The Company is headquartered in New York City where it serves the needs of counter-terrorism, public safety, and law enforcement and is developing new technologies in nanotechnology and alternative energy as a result of its recently formed relationship with The National Aeronautics and Space Administration. At December 31, 2009, the Company had total assets of $1,686,924 against total liabilities, all current, of $18,153,452, resulting in stockholders' deficit of $16,466,528. In its quarterly report on Form 10-Q for the December 31, 2009 period, the Company said it has limited capital resources, has incurred significant historical losses and negative cash flows from operations and has no current period revenues. As of December 31, 2009, the Company had $1,188 in cash and no accounts receivable. The Company believes that funds on hand combined with funds that will be available from its various operations will not be adequate to finance its operations requirements and enable the Company to meet any of its financial obligations, including its payments under convertible notes and promissory notes for the next 12 months. There is substantial doubt about the Company's ability to continue as a going concern. If the Company is unable to raise additional funds, it may be forced to further reduce, or cease operations, liquidate assets, renegotiate terms with lenders and others of which there can be no assurance of success, or file for bankruptcy protection. MSGI SECURITY: Gruber & McBaine Holds 2.9% of Common Stock ---------------------------------------------------------- San Francisco, California-based Gruber & McBaine Capital Management, LLC; Jon D. Gruber; J. Patterson McBaine; and Eric Swergold disclosed that as of December 31, 2009, they may be deemed to beneficially own 1,302,838 shares or roughly 2.9% of the common stock of MSGI Security Solutions. About MSGI Security MSGI Security Solutions, Inc. (Other OTC: MSGI) -- http://www.msgisecurity.com/-- is a provider of proprietary solutions to commercial and governmental organizations. The Company is developing a global combination of innovative emerging businesses that leverage information and technology. The Company is headquartered in New York City where it serves the needs of counter-terrorism, public safety, and law enforcement and is developing new technologies in nanotechnology and alternative energy as a result of its recently formed relationship with The National Aeronautics and Space Administration. At December 31, 2009, the Company had total assets of $1,686,924 against total liabilities, all current, of $18,153,452, resulting in stockholders' deficit of $16,466,528. In its quarterly report on Form 10-Q for the December 31, 2009 period, the Company said it has limited capital resources, has incurred significant historical losses and negative cash flows from operations and has no current period revenues. As of December 31, 2009, the Company had $1,188 in cash and no accounts receivable. The Company believes that funds on hand combined with funds that will be available from its various operations will not be adequate to finance its operations requirements and enable the Company to meet any of its financial obligations, including its payments under convertible notes and promissory notes for the next 12 months. There is substantial doubt about the Company's ability to continue as a going concern. If the Company is unable to raise additional funds, it may be forced to further reduce, or cease operations, liquidate assets, renegotiate terms with lenders and others of which there can be no assurance of success, or file for bankruptcy protection. MXENERGY HOLDINGS: Sempra Sole Holder of Class B Stock ------------------------------------------------------ MXenergy Holdings Inc. reported that it inaccurately stated that Class C common stock represents about 7.4% of the total outstanding common stock but Class B common stock represents 7.4% of the Company's common stock instead. Sempra Energy Trading LLC said it is the sole holder of Class B Common Stock of MXenergy Holdings Inc. Class C Common Stock represents approximately 7.4% of the Company's total outstanding common stock. In connection with two master supply and hedge agreements, RBS Sempra is also the Company's primary liquidity and hedge provider. Pursuant to the terms of the Company's Certificate of Incorporation, RBS Sempra is entitled to appoint one director to the Company's Board of Directors. In September 2009, RBS Sempra appointed Michael A. Goldstein to serve as the Class B Director. Effective March 16, 2010, Mr. Goldstein resigned his position as the Class B Director due to his assumption of new responsibilities at RBS Sempra. During his tenure, Mr. Goldstein served on the Executive Committee, the Compensation Committee and the Risk Oversight Committee of the Board of Directors. Also effective March 16, 2010, RBS Sempra appointed Jacqueline Mitchell to serve as the Class B Director. Ms. Mitchell is Senior Managing Director at RBS Sempra Commodities, where she oversees RBS Sempra's North American natural gas trading and marketing operations. As part of RBS Sempra's senior management team, she has been instrumental in creating and overseeing steady growth in their commodity trading business. Ms. Mitchell's in-depth understanding of natural gas commodity markets is expected to provide expertise and insight for the Company's risk management and other operating activities. Ms. Mitchell will also serve on the Executive Committee, the Compensation Committee and the Risk Oversight Committee. About MXenergy MXenergy Holdings Inc. was founded in 1999 as a retail energy marketer. The two principal operating subsidiaries of Holdings are MXenergy Inc. and MXenergy Electric Inc. which are engaged in the marketing and supply of natural gas and electricity, respectively. Holdings and its subsidiaries operate in 39 market areas located in 14 states in the United States and in two Canadian provinces. At Dec. 31, 2009, the Company's assets were at $222.96 million, and debts were at $142.01 million, resulting to a $80.95 million stockholders' equity for Dec. 31, 2009. Mxenergy carries Caa3 long term corporate family and Ca/LD probability of default ratings from Moody's Investors Service. NATIONAL CONSUMER: Thrift Supervision Deal Doesn't Move Ratings --------------------------------------------------------------- National Consumer Cooperative Bank and its subsidiary NCB, FSB have entered into an agreement with the Office of Thrift Supervision. Although there are several elements of these actions which restrict operations at NCCB and NCB, FSB, the effect of the actions has no material operational implications and does not currently impact the ratings. Fitch previously downgraded the long-term Issuer Default Ratings of NCCB and NCB, FSB to 'B' from 'BB-' on Nov. 25, 2009, following the review of the company's financial disclosure showing substantial asset quality deterioration. The ratings were placed on Rating Watch Negative at that time. The recent enforcement actions reflect the degree of financial distress that prompted Fitch's November 2009 downgrade and the placement on Watch status. Fitch will revisit the IDR and the Negative Rating Watch shortly after review of financial performance and further discussions with management. While current ratings suggest serious weaknesses in NCCB's credit profile, further negative rating actions could result if it appears that NCCB is unable or unlikely to meet the requirements as set forth in the agreement or if there is additional deterioration in fundamentals (including asset quality, capitalization ratios and/or liquidity). On March 19, 2010, NCCB released an 8-K that stated NCCB signed an enforcement action issued by the OTS. The action, a Stipulation and Consent to Order to Cease and Desist and its associated regulatory order, requires the submission of strategic and other business plans for the period 2010-2011, among other items, NCCB's plan to address its capital and debt service requirements without relying upon dividends from its subsidiary thrift, NSB, FSB. In addition, the agreement requires that NCCB notify and obtain OTS consent prior to undertaking certain activities, including raising senior executive officer compensation, issuing dividends, or incurring additional debt. At the same time, NCB, FSB, which is wholly owned by NCB Financial Corporation, entered into a Supervisory Agreement with the OTS that similarly requires the submission of strategic and related plans for the 2010-2011 planning period. Fitch currently rates NCCB and its subsidiaries: National Consumer Cooperative Bank -- Long-term IDR 'B'; -- Individual 'D/E'; -- Senior secured debt 'BB/RR1'; -- Short-term IDR 'B'; -- Support '5'; -- Support floor 'NF'. NCB, FSB -- Long-term IDR 'B'; -- Individual 'D'; -- Long-term deposit obligations 'B+/RR3'; -- Short-term IDR 'B'; -- Short-term deposit obligations 'B'; -- Support '5'; -- Support floor 'NF'. NCB Capital Trust I -- Trust preferred stock 'CC/RR6'. NEW COMMUNICATIONS: Moody's Puts 'Ba2' Rating on $3.2 Bil. Notes ---------------------------------------------------------------- Moody's Investors Service assigned a (P)Ba2 rating to the first tranche of the proposed approximately $3.2 billion notes to be issued by New Communications Holdings Inc., a wholly-owned subsidiary of Verizon Communications Inc. The gross proceeds of the offering will be deposited into an escrow account. Spinco intends to use the net proceeds from the offering to fund a portion of a special cash payment by Spinco to Verizon, in connection with the spin-off of Spinco to Verizon's shareholders and the subsequent merger of Spinco with and into Frontier Communications Corporation. Moody's also assigned a (P)Ba2 rating to Frontier's proposed $750 million senior unsecured revolving credit facility, which will come into effect and is conditioned on the closing of the merger with Spinco. The newly assigned ratings are prospective and are based on Moody's expectation that Frontier's Corporate Family Rating will be Ba2 with a stable outlook following the pending merger of Frontier and Spinco, by mid-2010. Per Moody's event risk policy, Frontier's ratings will remain under review until all the facts are available and there is certainty of an event occurring. Accordingly, Frontier's Ba2 CFR remains under review for an upgrade pending the closing of the merger at which time Moody's expects to conclude the review and confirm Frontier's ratings. The ratings for the senior notes at Verizon North Inc. and Verizon West Virginia Inc, which will become wholly-owned subsidiaries of Spinco prior to the merger, remain under review for downgrade. Ratings actions include these: Issuer: Frontier Communications Corporation Assignments: -- Senior Unsecured Bank Credit Facility, Assigned (P)Ba2, LGD4 - 54% Issuer: New Communications Holdings Inc. Assignments: -- Senior Unsecured Regular Bond/Debentures, Assigned (P)Ba2, LGD4 - 54% Moody's expectations that it will confirm Frontier's ratings with a stable outlook upon completion of the pending merger largely reflect the significant integration risk the Company will face in assuming the much larger Spinco operations. Specifically, the rating reflects the uncertainties in the near term that the operating systems transition and integration will go smoothly, and in the longer term that the combined companies will be able to achieve the expected synergies in a timely manner. In addition, the continued downward pressure on wireline revenue and cash flow weighs on the ratings. At the same time, the ratings will benefit from the predictability of the Company's cash flow generation, and management's stated commitment to devote free cash flow to debt repayment and drive the Company's credit metrics to investment grade levels. Frontier is currently weakly positioned in the Ba2 rating category, based on its relatively high debt levels for a wireline telecommunications company, the continuing downward pressure on its revenue and cash flow, and its high dividends. Frontier's weaker credit profile results from a combination of declining revenue and EBITDA, high unfunded pension obligations, and an increase in expenditures in anticipation of the proposed merger with Spinco. Moody's notes that if the acquisition of the Spinco properties does not close and no other similar transforming events are expected to occur, Frontier is unlikely to retain its Ba2 CFR. Although Frontier's estimated $240 million in integration costs are reasonable considering the size of Spinco, the bigger complexities in telecom mergers usually involve information system conversions and billing migration, which may greatly delay the envisioned synergies. Moody's Vice President, Gerald Granovsky said, "Until the switchover of systems from Verizon to Frontier is completed, this risk will not go away, although Moody's would be able to assess the results within a relatively short timeframe following the completion of the acquisition and as the Company implements the phased migration of Spinco operations into its systems." An additional challenge will be merging the two companies' corporate cultures. Moreover, Frontier will not realistically be in a position to get critical data on the acquired customer metrics until one or two quarters following the merger, while the planned plant upgrades to deliver high speed data will take up to two years. Moody's believes that the combined companies' pro forma credit profile is at a weaker starting point than what Moody's anticipated at the time of the merger announcement in May 2009. As a result, the combined entity will need to deliver even stronger operating performance over the next two years to reach financial metrics that are consistent with the investment grade ratings the Company is targeting. While Moody's recognizes the merits of the proposed transaction, including a turn of deleveraging expected at closing and opportunities to grow revenue and generate cost savings, the rating agency believes that even if the Company were to meet its performance targets, given the nature of upfront spending on integration and investments required in Spinco's footprint, Frontier's credit metrics will likely not stabilize before the end of 2011. While Frontier's standalone SGL-1 short term liquidity rating remains unchanged, the combined company's liquidity profile will likely worsen following the completion of the merger, due to the expected increase in integration related spending that could erode Frontier's free cash flow. Moody's most recent rating action for Frontier was on September 17, 2009. At that time Moody's assigned a Ba2 rating on the Company's new note issuance. Frontier Communications is an incumbent local exchange carrier providing wireline telecommunications services to approximately 2.1 million access lines in primarily rural areas and small- and medium-sized cities. The company is headquartered in Stamford, CT. New Communications Holdings Inc., which is a wholly-owned subsidiary of Verizon Communications, Inc., will hold the assets and liabilities Verizon will spin off prior to closing the merger with Frontier. Verizon is headquartered in New York, NY. NEW YORK RACING: Racing Industry Rallies for New Casino Operator ---------------------------------------------------------------- Jacqueline Palank at Dow Jones' Daily Bankruptcy Beat, citing the Daily Racing Form, reports that more than 1,000 members of the racing industry -- thoroughbred horse owners, trainers, breeders and their families -- held a two-hour rally Sunday at the New York Racing Association's Belmont Park, urging state officials to select a new casino operator. NYRA has a franchise to run tracks Aqueduct, Belmont Park and Saratoga. Ms. Palank relates that in conjunction with the rally, six horsemen boycotted Sunday's first race at Aqueduct, another track operated by NYRA, by deliberately not bringing their horses to the track on time, resulting in their horses being withdrawn from the race. As a result, they were fined $500 each by racing regulators. Ms. Palank also reports that Rick Violette, president of the New York Thoroughbred Horsemen's Association, said Monday that the rally and boycott were just the start, throwing out the possibility of heading to the state capital or holding another rally at Aqueduct. The Troubled Company Reporter on March 16, 2010, reported that the New York state licensing officials disapproved Aqueduct Entertainment Group's bid to build a casino at the Aqueduct racetrack. The TCR, citing The New York Times' City Room, reported that the office of New York Gov. David A. Paterson said AEG could not pass muster with state licensing officials and would not be awarded the lucrative contract. NY Times said a senior administration official indicated that AEG had supplied insufficient financial details for some of its investors. In other cases, the state's Lottery Division was not comfortable licensing some of AEG's investors. Had its bid been approved, according to City Room, AEG would have had to come up with a $300 million licensing fee by the end of March, money that would have helped the state's beleaguered finances. NYRA emerged from Chapter 11 protection in 2008. NYRA had settled a key dispute with the state of New York and assured itself at least 25 more years of operating the racetracks. NYRA had also secured state officials' approval to install lucrative video lottery terminals, or VLTs, at their tracks. AEG would have installed the revenue-boosting video lottery terminals. As reported by the TCR on December 22, 2009, Stephen Geffon at Queens Chronicle said NYRA may run out of money by summer 2010 if the state does not select a bidder to construct and operate the Aqueduct video lottery terminals. NYRA president Charles Hayward blamed the 10% decline in wagering at Aqueduct this year for NYRA's running out of cash, Queens Chronicle noted. Mr. Hayward said half of the $30 million from the state to keep it operating until the Aqueduct's VLT became operation has been depleted. On Wednesday, Ms. Palank said the proposed casino deal could be back on track soon. According to Ms. Palank, Gov. Paterson last week said he expects to have a solution within a month. Citing the New York Daily News, Ms. Palank wrote that Gov. Paterson chose the bidder that was recently rejected, and officials in his administration are now at work drafting new rules to select a casino operator. About NYRA Based in Jamaica, New York, The New York Racing Association Inc. aka NYRA -- http://www.nyra.com/-- operates racing tracks in Aqueduct, Belmont Park and Saratoga. The Company filed for chapter 11 protection on Nov. 2, 2006 (Bankr. S.D.N.Y. Case No. 06-12618). Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, Henry C. Collins, Esq., at Cooper, Erving & Savage LLP, and Irena M. Goldstein, Esq., at Dewey Ballantine LLP represented the Debtor in its restructuring efforts. The Garden City Group Inc. served as the Debtor's claims and noticing agent. The U.S. Trustee for Region 2 appointed an Official Committee of Unsecured Creditors. Edward M. Fox, Esq., Eric T. Moser, Esq., and Jeffrey N. Rich, Esq., at Kirkpatrick & Lockhart Preston Gates Ellis LLP, represented the Committee. When the Debtor sought protection from its creditors, it listed assets of $153 million and debts of $310 million. NORTEL NETWORKS: $7 Mil. in Claims Change Hands March 2-11 ---------------------------------------------------------- The Clerk of the Bankruptcy Court recorded notices of transfer of about 20 claims, aggregating more than $7 million, in the Debtors' Chapter 11 cases for the period from March 2 to 11, 2010: Claim Claim Transferee Transferor Number Amount ---------- ---------- ------ ---------- ASM Capital LP Kirk Consulting Group 1829 $2,500 TTI Team Telecom Int'l. 5044 $574,660 Followup Net LLC -- $8,250 Intec Billing Inc. -- $2,882 ASM Capital III LP Layne Communications 339 $180,479 Eion Inc. 5660 $427,281 Corre Opportunities Baseline Consulting Group -- $52,969 Fund LP Weber Shardwick Worldwide -- $394,258 Drawbridge Special Wistron Corporation 5633 $594,323 Opportunities Fund LP 4547 $16,347 5636 $1,687,674 5638 $1,934,174 Drawbridge Special Wistron Corporation 5633 $158,486 Opportunities Fund Ltd. 4547 $4,359 5636 $450,046 5638 $515,779 Worden Master Fund LP Wistron Corporation 5633 $39,621 4547 $1,089 5636 $112,511 5638 $128,944 About Nortel Networks Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/-- delivers communications capabilities that make the promise of Business Made Simple a reality for the Company's customers. The Company's next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate the barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of US$11.6 billion and consolidated liabilities of US$11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about US$9 billion and liabilities of US$3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about US$4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NORTEL NETWORKS: Proposes More Work for Global IP ------------------------------------------------- Nortel Networks Inc. and its affiliated debtors filed a supplemental application, asking the Court to allow Global IP Law Group LLC to provide additional services and to approve the terms of the firm's compensation. The Debtors employed Global IP late last year to evaluate the marketability of their intellectual property portfolio, which includes about 3,500 "patent families." The licenses to the patents are either held or owned by NNI, Nortel Networks Ltd., Nortel Networks UK Ltd. and NN Ireland. Under their supplemental application, the Debtors ask the Court to authorize Global IP to, among other things, provide legal advice and counsel on monetization strategies and to continue assisting them after the appropriate strategy is selected and effectuated. They also seek approval of these additional terms governing NNL's payment of fees to Global IP: (1) For services rendered before February 1, 2010, a rate of $400 per hour for each Global IP partner, a 20% discount off of Global IP's standard fees, with total fees not to exceed $75,000 without prior approval from NNL. (2) For services rendered on or after February 1, 2010, a fixed fee of $250,000 per month, with an initial four- month commitment to be extended month-to-month upon the consent of the holders and owners of the licenses, the "bondholders group" and the Official Committee of Unsecured Creditors. The Debtors also filed a motion, seeking approval to file under seal a set of documents that were executed in connection with their supplemental application on grounds that they contain sensitive commercial information. The Court will hold a hearing on March 31, 2010, to consider approval of the requests. Deadline for filing objections is March 24. About Nortel Networks Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/-- delivers communications capabilities that make the promise of Business Made Simple a reality for the Company's customers. The Company's next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate the barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of US$11.6 billion and consolidated liabilities of US$11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about US$9 billion and liabilities of US$3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about US$4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NORTEL NETWORKS: Wins OK for LinkLaters as U.K. Counsel ------------------------------------------------------- Nortel Networks Inc. and its affiliated debtors obtained approval from the U.S. Bankruptcy Court to employ Linklaters LLP as their U.K. counsel, effective January 26, 2010. The Debtors tapped the services of Linklaters in light of the proofs of claim that were filed against NNI and some of its affiliates by the Board of the Pension Protection Fund. NNUK Pension Trust serves as trustee of the pension scheme of Nortel Networks UK Ltd. while the PPF Board manages U.K.'s Pension Protection Fund. The amount of claim asserted by the Pension Trustee and the PPF Board has not yet been determined. It is, however, believed to be over GBP2.1 billion, which is the estimated NNUK's pension scheme deficit as of January 13, 2009. "Linklaters' resources and capabilities are crucial to the multi- jurisdictional issues confronting the Debtors' success including asserted potential pension obligations under U.K. law," says the Debtors' counsel, Ann Cordo, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, Delaware. "The services of Linklaters are necessary and essential to enable the Debtors to defend the claims of the trustee and the PPF," Ms. Cordo says in court papers. As the Debtors' U.K. counsel, Linklaters will be tasked to provide advice to the Debtors about U.K. law and other legal services in connection with the alleged pension obligations and the proofs of claim filed by the Pension Trustee and the PPF. Linklaters will be paid for its services on an hourly basis and will also be reimbursed of its necessary and reasonable expenses. The firm's hourly rates are: Partners GBP650 Counsel GBP600 Managing Associates GBP550 Associates GBP465 Trainee Solicitors GBP280 Paralegals GBP125 The Debtors will also be charged of fees and expenses of Paul Newman QC and James Walmsley of Wilberforce Chambers, the barristers instructed by Linklaters to represent NNI and Nortel Networks (CALA) Inc. in their Chapter 11 cases or to defend their rights under U.K. law. The hourly rates of Messrs. Newman and Walmsley are GBP500 and GBP175, respectively. In a declaration filed with the Court, Mark Blyth, Esq., a partner at Linklaters, assures the Court that his firm does not have interests adverse to the interest of the Debtors or their creditors. He asserts that Linklaters is a "disinterested person" as the term is defined under Section 101(14) of the Bankruptcy Code. About Nortel Networks Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/-- delivers communications capabilities that make the promise of Business Made Simple a reality for the Company's customers. The Company's next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate the barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of US$11.6 billion and consolidated liabilities of US$11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about US$9 billion and liabilities of US$3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about US$4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NUTRACEA INC: Creditors Object to More Plan Time ------------------------------------------------ BankruptcyData.com reports that NutraCea's official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to NutraCea's motion for an exclusivity extension. The objection states, "From a legal standpoint, the Debtor has failed to cite, much less establish, any factors that would support "cause" for extending exclusivity. From a factual standpoint, and simply put, the Debtor's current path of selling assets piecemeal without any provision for payment or reserves for unsecured creditors is akin to a sub rosa plan. Under this scenario, the Committee has no opportunity to test the feasibility of the Debtor's ongoing operations, and creditors are being placed in a position of forced financing for the Debtor's continued business. Because the Debtor cannot justify the retention of exclusivity, and based on the nature of the case, exclusivity should be terminated to enable the Committee to file a plan of reorganization if it so desires." About NutraCea NutraCea is a world leader in production and utilization of stabilized rice bran. NutraCea holds many patents for stabilized rice bran (SRB) production technology and proprietary products derived from SRB. NutraCea's proprietary technology enables the creation of food and nutrition products to be unlocked from rice bran, normally a waste by-product of standard rice processing. Phoenix, Arizona-based Nutracea, a California corporation, filed for Chapter 11 bankruptcy protection on November 10, 2009 (Bankr. D. Ariz. Case No. 09-28817). S. Cary Forrester, Esq., at Forrester & Worth, PLLC, assists the Company in its restructuring effort. The Company listed $50,000,001 to $100,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. ONASNI PROPERTY: Relief from Stay Hearing Set for March 31 ---------------------------------------------------------- WestLaw reports that the fact that, following a Chapter 11 debtor- mortgagor's default on a mortgage loan secured by an eight-unit rental property, and when the mortgagee exercised its contractual right to collect rents, each of these eight units was rented at a combined monthly rental more than sufficient to satisfy any accruing interest on the mortgage loan did not preclude the mortgagee from moving for relief from stay, after water service to these rental units was discontinued for nonpayment of a water bill and seven of the eight tenants quit the premises, from obtaining relief from the stay based on a lack of adequate protection for its interest. While the debtor asserted that any lack of adequate protection was of mortgagee's own making in allowing the vacancies to occur, the mortgagee did not, by exercising a contractual right to collect rents, assume responsibility for managing the property and seeing that the water bill was paid. In re Onasni Property Group, LLC, --- B.R. ----, 2010 WL 841312 (Bankr. W.D. Pa.) (Fitzgerald, J.). Judge Fitzgerald has scheduled a pretrial hearing for 9:30 a.m. on March 31, 2010, on First Commonwealth Bank's motion for relief from the automatic stay. Onasni Property Group, LLC, sought Chapter 11 protection (Bankr. W.D. Pa. Case No. 09-28455) on Nov. 13, 2009, and the Debtor estimated at the time of the filing that assets will be available for distribution to its unsecured creditors. OVERSEAS SHIPHOLDING: S&P Assigns 'BB-' Rating on $300 Mil. Notes ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its issue-level and recovery ratings to Overseas Shipholding Group Inc.'s (BB- /Stable/--) proposed eight-year $300 million senior unsecured notes issue. The issue-level rating is 'BB-', the same as the corporate credit rating, and the recovery rating is '4', indicating that lenders can expect average (30%-50%) recovery in a payment default scenario. S&P also rate OSG's 7.5% senior notes due 2024 and 8.75% debentures due 2013. The issue-level rating on these instruments is 'BB-' (the same as the corporate credit rating) and the recovery rating is '4', indicating that lenders can expect average (30%-50%) recovery in a payment default scenario. OSG has secured debt and other unsecured bank debt that S&P does not rate. Ratings List Overseas Shipholding Group Inc. Corp. credit rating BB-/Stable/-- Ratings Assigned Proposed $300 million senior unsecured notes issue BB- Recovery rating 4 7.5% senior notes due 2024 BB- Recovery rating 4 8.75% debentures due 2013 BB- Recovery rating 4 PHARMANET DEVELOPMENT: Moody's Assigns 'B3' Rating on Senior Notes ------------------------------------------------------------------ Moody's Investors Service assigned a B3 rating to PharmaNet Development Group's proposed $175 million offering of senior secured notes. Moody's also assigned a B3 Corporate Family and a B3 Probability of Default rating to PharmaNet. The proceeds from the proposed offering will be used to refinance PharmaNet's current term loan and fund a $105 million dividend to JLL Partners. JLL Partners acquired PharmaNet on March 24, 2009. The notes will have a second lien priority on all assets while the proposed $25 million asset-based revolver (not rated by Moody's) will have a first priority security in all assets. This is the first time Moody's has publicly rated PharmaNet since it was acquired by JLL. The rating outlook is stable. The B3 Corporate Family Rating reflects PharmaNet's limited scale in the global contract research organization industry, which is highly competitive and subject to cancellation risk. The ratings also reflect the significant increase in leverage and reduction in equity due to the recapitalization of the company. In addition, PharmaNet has a meaningful concentration of revenue and backlog by customer and drug program. While PharmaNet's largest customer is one of the world's leading pharmaceutical companies, given the uncertainty inherent in the drug development process, Moody's view client concentration as a particular risk in the CRO industry. The ratings are supported by PharmaNet's broad service offerings (well balanced between early and late stage services) and good geographic diversity. Further, Moody's believes the broader CRO industry outlook is stabilizing and the longer-term industry demand fundamentals remain sound. Moody's assigned these ratings: * Corporate Family Rating, B3 * Probability of Default Rating, B3 * $175 million Senior Notes (second lien) due 2017, B3 (LGD3, 46%) The rating outlook is stable. PharmaNet, based in Princeton, NJ, is a leading global CRO that provides product development services primarily to pharmaceutical and biotechnology companies. The company provides a broad range of early and late stage clinical trial and bioanalytical laboratory services. PharmaNet generated direct revenues of approximately $328 million for the twelve month period ended December 31, 2009. PACIFIC ETHANOL: Calif. SC Approves Settlement With Socius CG ------------------------------------------------------------- The Superior Court of the State of California for the County of Los Angeles approved the Stipulation for Settlement of Claim in the matter entitled Socius CG II, Ltd., vs. Pacific Ethanol, Inc. The Order provides for the full and final settlement of Socius GC II, Ltd.'s $5,000,000 claim against the company. Socius purchased the Claim from Lyles United, LLC, a creditor of Pacific Ethanol, Inc., 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 the company pursuant to the terms of an Amended and Restated Promissory Note dated November 7, 2008, in the original principal amount of $30,000,000. Pursuant to the terms of the Order, on March 5, 2010, the company issued and delivered to Socius 5,800,000 shares of its common stock, subject to adjustment as set forth in the Order. Under the terms of the Order, on March 16, 2010, Socius returned 2,554,194 of the Settlement Shares the company issued to them on March 5, 2010 . As a result, in full satisfaction of the Claim, the company issued to Socius a total of 3,245,806 shares of its common stock. 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. PHARMANET DEVELOPMENT: S&P Assigns 'B+' Corporate Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said that it has assigned its 'B+' corporate credit rating to Princeton, New Jersey-based PharmaNet Development Group Inc. At the same time, Standard & Poor's also assigned a 'B+' senior secured debt rating and a recovery rating of '3' indicating meaningful (50%-70%) recovery to the company's proposed $175 million second lien senior secured notes due in 2017. "The speculative-grade ratings on PharmaNet reflect the sponsor- owned company's aggressive financial risk profile and PharmaNet's need to continue to compete successfully against larger, better financed players," said Standard & Poor's credit analyst Arthur Wong. Offsetting these concerns is the company's well established niche position in oncology and its global infrastructure that enables it to compete for larger contracts. Notwithstanding the company's particularly solid position in oncology, PharmaNet is a relatively small player in the fragmented CRO industry, a key consideration in its weak business risk profile, and competes against much larger and better financed rivals. Furthermore, PharmaNet may need to further expand its infrastructure in order to keep pace with its larger rivals in bidding for larger, broader contracts. The rating outlook is stable. After a challenging late 2008-2009, S&P believes conditions in the CRO industry is improving. Should PharmaNet's book-to-bill ratio improve to the 1.4x area, the company establishes a track record of consistent free cash flows, and debt leverage declines to well under 4x, a ratings upgrade would be considered. However, if the industry suffers another downturn, PharmaNet is unable to in new large contracts, and the company's leverage deteriorates to over 5x, a ratings downgrade would be considered. PHILADELPHIA NEWSPAPERS: Seeks to Force Lenders to Extend DIP Loan ------------------------------------------------------------------ Dow Jones' Daily Bankruptcy Review reports that Philadelphia Newspapers LLC is suing its lenders in an attempt to force them to extend the deadline to repay the Debtor's bankruptcy loan beyond March 31. Philadelphia Newspapers -- http://www.philly.com/-- owns and operates numerous print and online publications in the Philadelphia market, including the Philadelphia Inquirer, the Philadelphia Daily News, several community newspapers, the region's number one local Web site, philly.com, and a number of related online products. The Company's flagship publications are the Inquirer, the third oldest newspaper in the country and the winner of numerous Pulitzer Prizes and other journalistic recognitions, and the Daily News. Philadelphia Newspapers and its debtor-affiliates filed for Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D. Pa. Case No. 09-11204). Mark K. Thomas, Esq., and Paul V. Possinger, Esq., at Proskauer Rose LLP in Chicago, Illinois; and Lawrence G. McMichael, Esq., Christie Callahan Comerford, Esq., and Anne M. Aaronson, Esq., at Dilworth Paxson LLP, in Philadelphia, Pennsylvania, serve as bankruptcy counsel. The Debtors' financial advisor is Jefferies & Company Inc. The Garden City Group, Inc., serves as claims and notice agent. Ben Logan, Esq., at O'Melveny & Myers LLP in Los Angeles, California; and Gary Schildhorn, Esq., at Eckert Seamans Cherin & Mellott, LLC in Philadelphia, represent the Official Committee of Unsecured Creditors. Fred S. Hodara, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP in New York, represent the Steering Group of Prepetition Secured Lenders. Philadelphia Newspapers listed assets and debts of $100 million to $500 million in its bankruptcy petition. PLAINS EXPLORATION: Moody's Assigns 'B1' Rating on $300 Mil. Notes ------------------------------------------------------------------ Moody's Investors Service assigned a B1 (LGD 4: 64%) rating to Plains Exploration and Production's pending $300 million ten-year senior unsecured note offering. PXP's ratings include a Ba3 Corporate Family Rating, Ba3 Probability of Default Rating, and B1 (LGD 4; 64%) ratings on its existing senior unsecured notes. The rating outlook is negative. The negative outlook reflects the continuing weight of high leverage, possible additional borrowings in first half 2010 to fund the capital budget, and PXP's still pending need to now sustain organic operating results of a Ba-rating caliber from its transformed natural gas portfolio following completion of a two year asset portfolio transition. The transition leaves it over- leveraged on units of production, on proven developed reserves and, after properly weighting proven non-producing reserves for matching required future FAS 69 development capital outlays, on total proven reserves. In order to retain the ratings, PXP will need to generate convincing production growth by the end of second quarter 2010 and begin significantly reducing leverage on units of production. However, Moody's does not believe production growth alone will reduce leverage on production enough to retain the ratings, requiring debt reduction too. The ratings could also suffer during the remainder of 2010 if PXP fails to sustain production growth commensurate with its heavy capital spending rate or, by the end of the year, it posts uncompetitive reserve and production replacement costs while still highly leveraged. Conversely, the outlook could move to stable if PXP mounts combined strong production growth, debt reduction, and competitive reserve replacement costs. In the meantime, the ratings are retained due to PXP's durable California oil reserve base and supportive oil prices, sound liquidity while PXP works this year on mounting production growth at lower unit capital outlays than it has delivered for several years, and seasoned management. Any debt rating benefit from PXP's costly Gulf of Mexico exploration activity would be recognized when and if PXP either monetizes such properties for debt reduction or, much less likely, in later years that portion of PXP's portfolio moves past exploration and development to cash flow positive after regional capital spending. Interim risk mitigation also comes from price protection in the form of 2010 puts on 40,000 barrels/day of oil production at $55/barrel ($50 after a $5/barrel deferred premium) and by the hedging of 85,000 mmbtu of natural gas with collars having floors ranging from $4.64/ mmbtu to $6.12 / mmbtu and a ceiling of $8 / mmbtu. PXP's balance sheet reflects the high up-cycle cost at which PXP transitioned into the Haynesville Shale. PXP avoided higher leverage by also divesting substantial properties at attractive high up-cycle asset prices, issuing $648 million of equity and monetizing deeply in-the-money oil hedges last year on 40,000 barrels per day of oil production. This also enabled PXP to fund the $1.1 billion discounted pre-payment in full of $1.250 billion in capital spending carry PXP was required to fund on behalf of its Haynesville Shale joint venture partner, Chesapeake Energy. PXP's 2009 reported reserve replacement costs remained very high but much of this was largely due to the inclusion in capital outlays the $375 million in scheduled Chesapeake Haynesville capital spending carry and the $1.1 billion buyout of PXP's remaining obligations on that carry. Absent those costs, PXP reports much more competitive all-in reserve replacement costs. Leverage on PD reserves, on proven reserves (fully-loaded for FAS 69 capital spending), and on production are very high for the ratings, reflecting the front-end and carried costs of buying into Chesapeake's Haynesville acreage and heavy Gulf of Mexico capital outlays. Moody's last rating action for PXP was on March 16, 2010, when Moody's affirmed its Ba3 Corporate Family Rating, Ba3 Probability of Default Rating, B1 (LGD 4; 64%) note ratings and negative rating outlook. Plains Exploration & Production Company is headquartered in Houston, Texas. PLAINS EXPLORATION: S&P Assigns 'BB-' Rating on $300 Mil. Notes --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' issue-level rating to Plains Exploration & Production Co.'s new $300 million senior unsecured notes due 2020, one notch lower than the corporate credit rating on the company. At the same time, S&P assigned a recovery rating of '5' to this debt, indicating expectations of modest (10%-30%) recovery in a payment default. PXP will use proceeds from the new notes to pay down borrowings under its revolving credit facility and for general corporate purposes. The corporate credit rating on PXP is 'BB' and the outlook is negative. Ratings List Plains Exploration & Production Co. Corporate Credit Rating BB/Negative/-- Ratings Assigned Plains Exploration & Production Co. $300 Mil. Sr Unsec Notes Due 2020 BB- Recovery Rating 5 PREMIER GENERAL: Section 341(a) Meeting Scheduled for April 12 -------------------------------------------------------------- The U.S. Trustee for Region 7 will convene a meeting of creditors in Premier General Holdings, Ltd.'s Chapter 11 case on April 12, 2010, at 9:30 a.m. The meeting will be held at San Antonio Room 333, U.S. Post Office Bldg., 615 E. Houston St., San Antonio, TX 78205. 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. San Antonio, Texas-based Premier General Holdings, Ltd., filed for Chapter 11 bankruptcy protection on March 17, 2010 (Bankr. W.D. Texas Case No. 10-51005). William B. Kingman, Esq., who has an office in San Antonio, Texas, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50,000,001 to $100,000,000. PROTOSTAR LTD: Creditors Appeal $5M Satellite Sale Bonuses ---------------------------------------------------------- Bankruptcy Law360 reports that ProtoStar Ltd.'s committee of unsecured creditors plans to appeal a bankruptcy judge's approval of $5 million in bonus payments to company managers for the combined $385 million sale of two satellites. Hamilton, HM EX, Bermuda-based ProtoStar Ltd. is a satellite operator formed in 2005 to acquire, modify, launch and operate high-power geostationary communication satellites for direct-to- home satellite television and broadband internet access across the Asia-Pacific region. The Company and its affiliates filed for Chapter 11 on July 29, 2009 (Bankr. D. Del. Lead Case No. 09-12659). The Debtor selected Pachulski Stang Ziehl & Jones LLP as Delaware counsel; Law Firm of Appleby as their Bermuda counsel; UBS Securities LLC as financial advisor & investment banker and Kurtzman Carson Consultants LLC as claims and noticing agent. The Debtors have tapped UBS Securities LLC as investment banker and financial advisor. Also on July 29, 2009, ProtoStar and its affiliates, including ProtoStar Development Ltd., commenced a coordinated proceeding in the Supreme Court of Bermuda. John C. McKenna of Finance & Risk Services Ltd. as liquidator of the Bermuda Group. In their Chapter 11 petition, the Debtors listed between US$100 million and US$500 million each in assets and debts. As of December 31, 2008, ProtoStar's consolidated financial statements, which include non-debtor affiliates, showed total assets of US$463,000,000 against debts of US$528,000,000. REGENT BROADCASTING: Files Schedules of Assets and Liabilities -------------------------------------------------------------- Regent Broadcasting of Lafayette, LLC, filed with the U.S. Bankruptcy Court for the District of Delaware its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $1,318,937 B. Personal Property $17,975,512 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $0 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $218,988 ----------- ----------- TOTAL $19,294,449 $218,988 On March 23, 2010, Regent Communications, Inc. and its other debtor-affiliates filed their respective schedules of assets and liabilities, disclosing: a. Regent Communications, Inc. total assets: $0 total liabilities: $0. b. Regent Broadcasting of El Paso, Inc.: total assets: $7,742,969 total liabilities: $246,337 c. Livingston County Broadcasters, Inc.: total assets: $0 total liabilities: $0 d. Regent Broadcasting, LLC: total assets: $0 total liabilities: $204,681,379 e. B&G Broadcasting, Inc.: total assets - $311,877 total liabilities - $0 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: Has Access Lenders' Cash Until July 28 ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware, in a final order, authorized Regent Communications, Inc., to use the prepetition lenders' cash collateral until July 28, 2010. The prepetition lenders, together, hold at least 2/3% of the aggregate principal amount of the prepetition obligations. The Debtors would use the cash collateral to meet immediate postpetition liquidity needs. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the prepetition lenders adequate protection liens, which are senior to any prepetition liens, subject only to carve out. 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: Resilient Wants New Plan of Reorganization ----------------------------------------------------------------- According to RBR.com, Resilient Capital Management said it wants a new plan of reorganization for Regent Communications Inc., which will give shareholders more than 12.8 cents per share "gift" they would receive, and asks a federal judge to appoint a special committee to represents the interests of the present shareholders. Resilient acquired all of the company's 2,802,193 shares between Dec. 23, 2010, and March 2, 2010 for $444,000. Regent's plan will cut its debt by $87 million. Present shareholders are entitled get a pro rata portion of $5.5 million in cash under the Plan. The Plan proposes to transfer ownership of the company to its lender and pay unsecured creditors in full, said The Troubled Company Reporter on March 24, 2010. About Regent Communications 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. RESERVE GOLF CLUB: Court Approves Plan of Reorganization -------------------------------------------------------- Alan Blondin at TheSunNews.com says a federal bankruptcy judge approved a plan of reorganization of Reserve Club. The plan provides for a sale to McConnell Golf but reimbursement rights for membership initiation fees for resigned and inactive members are eliminated under the sale. The resigned members, Mr. Blondin notes, can appeal to the U.S. District Court but it would require the posting of a significant bond. According to the report, McConnell Golf offered $522,705 plus a commitment to infuse significant new capital to fund capital improvements and offset reported negative cash flow from the club operations. The sale price includes: * $456,454 in existing operating debts to vendors and lenders that McConnell Golf would absorb; * an escrow account of $66,250 to be shared by current and resigned members who choose not to join under McConnell Golf; and * $1 for the sellers. Based in Pawleys Island, South Carolina, Reserve Golf Club of Pawleys Island LLC operates a golf course club. The company filed for Chapter 11 protection on December 4, 2009 (Bankr. D. S.C. Case No.09-09116). G. William McCarthy, Jr., Esq., represents the Debtor in its restructure efforts. The company listed assets of between $1 million and $10 million, and debts of between $100,000 to $500,000. RITZ CAMERA: Closes Shop at Boscov Ahead of Schedule ---------------------------------------------------- Stephen J. Pytak at the Republican Herald reports that Ritz Camera at Boscov's Fairlane Village mall has closed three days earlier than originally set. About Ritz Camera Headquartered in Beltsville, Maryland, Ritz Camera Centers, Inc. - - http://www.ritzcamera.com/-- sells digital cameras and accessories, and electronic products. The Company filed for Chapter 11 protection on February 22, 2009 (Bankr. D. Del. Case No. 09-10617). Irving E. Walker, Esq., Gary H. Leibowitz, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Baltimore, are bankruptcy counsel to the Debtor. Norman L. Pernick, Esq., and Karen M. Mckinley, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware, serve as local counsel. Thomas & Libowitz, P.A., is Debtor's special corporate counsel and conflicts counsel. Marc S. Seinsweig, at FTI Consulting, Inc, acts as the Debtor's chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and noticing agent. Attorneys at Cooley Godward Kronish LLP represent the official committee of unsecured creditors as lead counsel. The Committee selected Bifferato LLC as Delaware counsel. In its schedules, the Debtor listed total assets of $277 million and total debts of $172.1 million. RIVER WEST: to Reduce 45% of Administrative Overhead and Payroll ---------------------------------------------------------------- River West Plaza-Chicago, LLC, dba Joffco Square, filed with the U.S. Bankruptcy Court for the Northern District of Illinois a disclosure statement in connection with the proposed second amended Plan of Reorganization. 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 contemplates the transfer of all of the Debtor's remaining assets to the Reorganized Debtor for the implementation of the Plan, the treatment of creditors under the Plan and the reorganization and continuation of the Debtor's business by the Reorganized Debtor. Under the plan, the Debtor intends to fund all payments due from the revenue generated by its ongoing business operations. In addition, two of the Debtor's members, Amy Joffe and Melissa Norris, will provide up to $400,000 in subordinated unsecured financing toward the payment of the Debtors' Chapter 11 professional fees. The Reorganized Debtor will reduce its administrative overhead and payroll costs by about 45% on an annualized basis going forward. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/RiverWest_DS.pdf River West Plaza-Chicago LLC, dba Joffco Square, is an Illinois limited liability company, with its principal office located at 5 Revere Drive, Suite 200, Northbrook, Illinois 60062. The Company filed for Chapter 11 bankruptcy protection on December 7, 2009 (Bankr. N.D. Ill. Case No. 09-46258). Forrest B. Lammiman, Esq., at Meltzer, Purtill & Stelle LLC assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. ROTHSTEIN ROSENFELDT: Levinson Jewelers Denies Knowledge of Fraud ----------------------------------------------------------------- Melanie Cohen at Dow Jones' Daily Bankruptcy Review reports that Robin Levinson, the president of Levinson Jewelers -- the jewelry store where Scott Rothstein spent more than $700,000 -- said she had "no idea" what money Mr. Rothstein paid for the items with and that she had to ask for the money repeatedly. Ms. Cohen relates that, according to the South Florida Business Journal, Chuck Lichtman, Esq., a lawyer for the bankruptcy trustee who's winding down Rothstein Rosenfeldt Adler, said Ms. Levinson knew that some of the money came from Mr. Rothstein's law firm. Mr. Levinson, however, said Mr. Rothstein was only a customer of Levinson Jewelers and that she and her husband Mark pretended to be Mr. Rothstein's friends. Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA, has been suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed November 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non-existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on January 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. RUMJUNGLE - LAS VEGAS: Sec. 341(a) Meeting Scheduled for April 22 ----------------------------------------------------------------- The U.S. Trustee for Region 17 will convene a meeting of creditors in Rumjungle - Las Vegas LLC's Chapter 11 case on April 22, 2010, at 2:00 p.m. The meeting will be held at 300 Las Vegas Boulevard, South, Room 1500, Las Vegas, NV 89101. 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. Miami, Florida-based Rumjungle - Las Vegas LLC, A Nevada Limited Liability Company, dba Rumjungle, owns a nightclub in Las Vegas, Nevada. The Company filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. D. Nev. Case No. 10-14228). Nancy L. Allf, Esq., at Law Office Of Nancy L. Allf, assists the Company in its restructuring effort. According to the schedules, the Company has assets of $12,000,094, and total debts of $1,149,438. RUMJUNGLE - LAS VEGAS: Files Schedules of Assets & Liabilities ----------------------------------------------------------- Rumjungle - Las Vegas LLC has filed with the U.S. Bankruptcy Court for the District of Nevada its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $0 B. Personal Property $12,000,094 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $0 E. Creditors Holding Unsecured Priority Claims $5,000 F. Creditors Holding Unsecured Non-priority Claims $1,144,438 ----------- ---------- TOTAL $12,000,094 $1,149,438 Miami, Florida-based Rumjungle - Las Vegas LLC, A Nevada Limited Liability Company, dba Rumjungle, owns a nightclub in Las Vegas, Nevada. The Company filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. D. Nev. Case No. 10-14228). Nancy L. Allf, Esq., at Law Office of Nancy L. Allf, assists the Company in its restructuring effort. RUMJUNGLE - LAS VEGAS: Taps Nancy Allf as Bankruptcy Counsel ------------------------------------------------------------ Rumjungle - Las Vegas LLC has asked for permission from the U.S. Bankruptcy Court for the District of Nevada to employ Nancy L. Allf, Attorney at Law, a Nevada corporation, as bankruptcy counsel. Nancy C. Allf will, among other things: a. commence, prosecute and defend suits and proceedings arising out of or relating to the case and relating to assets of the estate, and represent the Debtor in other matters and things involving or connected with the affairs of the estate; b. assist in representing the Debtor before the Court, and assist in and render advice with respect to the preparation of contracts, reports, accounts, applications and orders; c. advise and consult with the Debtor with respect to any plan or reorganization which may be proposed in the proceedings and any matters concerning the estate which arise out of or follow the acceptance or confirmation of a plan or its rejection; and d. advise, consult with or otherwise represent the debtor in connection with other general, real estate, contract, business or litigation matters as may be necessary for the duration of the bankruptcy case. Nancy L. Allf will be paid based on the hourly rates of its personnel: Nancy L. Allf $400 Associate, Angela Nakamura $225 Paralegals $110 Ms. Allf assures the Court that the Nancy L. Allf law firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Miami, Florida-based Rumjungle - Las Vegas LLC, A Nevada Limited Liability Company, dba Rumjungle, owns a nightclub in Las Vegas, Nevada. The Company filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. D. Nev. Case No. 10-14228). According to the schedules, the Company has assets of $12,000,094, and total debts of $1,149,438. RUMJUNGLE - LAS VEGAS: Wants Weinberg as Litigation Counsel ----------------------------------------------------------- Rumjungle - Las Vegas LLC has asked for authorization from the U.S. Bankruptcy Court for the District of Nevada to hire Weinberg Wheeler Hudgins Gunn & Dial as litigation counsel. Prior to the Debtor's filing for bankruptcy protection, the Debtor was involved in a case against Mandalay Corp. et al. The Debtor accused Mandalay of breach of contract or fraud, regarding the leased premises where the Debtor operates its business. The Debtor says that the outcome of that litigation and lease is essential to the Debtor's reorganization and that it is necessary for Weinberg Hudgins to provide the Debtor legal services in the case. Weinberg Hudgins will be paid based on the hourly rates of its personnel: Partners $375 Associates $275 Paralegal $140 D. Lee Roberts, Jr., a partner at Weinberg Wheeler, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Miami, Florida-based Rumjungle - Las Vegas LLC, A Nevada Limited Liability Company, dba Rumjungle, owns a nightclub in Las Vegas, Nevada. The Company filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. D. Nev. Case No. 10-14228). According to the schedules, the Company has assets of $12,000,094, and total debts of $1,149,438. SANTA ANA: Fitch Affirms Low-B Ratings, Outlook Stable ------------------------------------------------------ Fitch Ratings has affirmed Santa Ana Pueblo's credit ratings: -- Issuer rating at 'BB'; -- $45 million enterprise revenue bonds, series 2006, at 'BB+'. The Rating Outlook is Stable. Santa Ana Pueblo's 'BB' issuer rating is supported by its relatively diverse operating profile within the Fitch-rated Native American gaming universe. Although the primary economic driver of the Pueblo, and therefore the primary credit driver, is its casino gaming operation, a small degree of operational diversification is provided by two other enterprises owned by the Pueblo, including a Hyatt resort property and a golf course operation. The Albuquerque gaming market is highly competitive, with four other Native American gaming entities operating seven properties in the area. However, the Santa Ana Star casino occupies an attractive niche position, serving the Rio Rancho locals market. Santa Ana's casino operation consistently ranks fourth in the market in slot win, behind Sandia, Isleta and Laguna Pueblos, and in 2009 captured 15% of slot win, which was unchanged versus 2008 (Isleta and Laguna Pueblos operate two and three casinos, respectively, versus Santa Ana and Sandia with one property each). The primary negative factors impacting the credit profile include a persistent weak operating trend at the casino, and recent instability in the casino senior management team, with two general managers leaving the property within 18 months. With respect to the weak operating trend, unlike many other regional gaming markets in the U.S., which exhibited negative top line revenue trends beginning in mid-late 2007, the Albuquerque local gaming market exhibited growth based on slot win through the first half of 2008. Since 3Q'08, however, slot win trends in the market have been negative, and although the rate of decline did decelerate in 3Q'09 as year-over-year comparisons became easier, an overall negative trend persists. Slot win for the market declined 9.1% in 2009, and slot win at the Santa Ana Star casino mirrored the market trends, declining by 8.7%. Positively, however, the Santa Ana Star did outperform the market in 4Q'09, with slot win declining by 3.4% versus a market-wide decline of 6.6%, which may be an early indication that Santa Ana's slot win growth will return to positive growth earlier than the broader market. Offsetting concerns about the negative operating trend and lending support to the 'BB' issuer rating and Stable Outlook is credit protection provided by Santa's Ana ample financial flexibility. Santa Ana's credit metrics are strong relative to the 'BB' rating category. At Dec. 31, 2009 debt/EBITDA equaled 1.45 times and EBITDA/debt service carrying charges including principal amortization equaled 2.97. An extremely restrictive additional debt test prohibits further leveraging of the enterprise revenue stream. Unless the magnitude of forward EBITDA declines continues to be at least as severe as was exhibited in the latest 12-month period ended Dec. 31, 2009, when EBITDA declined 16% versus the prior year period, leverage should decline over the projection period, since Santa Ana's debt amortizes fairly rapidly. The credit's liquidity profile is strong: cash on the enterprise fund balance sheet at Dec. 31, 2009 was well in excess of the amount needed for casino cage cash purposes, and the credit generated significantly positive free cash flow in 2009 (defined as cash from operations less capital expenditures and transfers to the tribal government). In contrast, many Native American gaming credits exhibit free cash flow close to zero after transfers to tribal government. As is typical for small tribal governments, Santa Ana does not maintain access to external liquidity in the form of a credit revolver or the like. Near-term uses of liquidity are minimal; there are no significant debt maturities in the capital structure and planned capital expenditures to be funded out of cash flow are manageable and are focused on maintenance and minor renovation projects at the casino. Over the last 18 months two consecutive general managers of the Santa Ana Star have resigned, the first in summer 2008 and the second in winter 2010. The position is currently vacant and an external search will be conducted. Concern related to this disruption is mitigated by the long tenure and stability in other key senior management positions, as well as the credit's commitment to the use of outside gaming industry consultants. Since 2004, the management board of the casino enterprise has employed an industry consultant to perform quarterly on-site consultations with casino management and prepare a detailed quarterly report on operational results and make suggestions for improvements. An upgrade of the issuer rating or a Positive Outlook will be highly unlikely in the near to medium term, given the credit's lack of geographic operating diversity, the stiff operational challenges inherent in the highly competitive Albuquerque gaming market, and the persistent negative gaming operating trend. A downgrade of the issuer rating or a Negative Outlook would be likely if operating trends continue to deteriorate, contributing to leverage approaching 2.2x in 2010, coupled with a weakening liquidity profile (i.e. credit produces negative free cash flow in 2010). Fitch notes that the operational stress in 2010 would have to be quite severe for leverage to increase to 2.2x; EBITDA would need to decline by 42% from the 2009 level, supporting a Stable Outlook at this time. The 2006 enterprise revenue bonds are term bonds maturing in 2015. The bonds are subject to mandatory monthly sinking fund payments of principal in an amount sufficient to fully amortize by maturity, resulting in a level debt service schedule through maturity. Additional debt outstanding includes a subordinate bank loan in the amount of $15 million, which matures in 2024. A 'BB+' transaction rating is assigned to debt secured by a lien on the combined gaming, hotel and golf enterprise cash flows. The transactions are rated one notch above the issuer rating due to credit enhancement provided by security covenants included in the legal documents associated with the transactions. SCHUCK-BAYMEADOWS: Taps GrayRobinson as Bankruptcy Counsel ---------------------------------------------------------- Schuck-Baymeadows, LLC, has sought authorization from the U.S. Bankruptcy Court for the Middle District of Florida to employ GrayRobinson, P.A., as bankruptcy counsel. GrayRobinson will: a. workout negotiations with its secured creditor; b. prepare and file a petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code and prepare all related initial pleadings to be filed in the case; and c. pre-petition expenses in the Debtor's case, including filing fees. GrayRobinson will be paid based on the hourly rates of its personnel: Jason B. Burnett $365 Lee S. Haramis $375 Paige Wagner $150 Attorneys $375 Paraprofessionals $150 Jason B. Burnett, a shareholder of GrayRobinson, assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Rexburg, Idaho-based Schuck-Baymeadows, LLC, filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. M.D. Fla. Case No. 10-02088). The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in debts. The Company's affiliate, Villa Sangria-Baymeadows, LLC, filed a separate Chapter 11 petition on March 16, 2010, listing $10 million to $50 million in assets and $1 million to $10 million in liabilities. SCHUCK-BAYMEADOWS: Section 341(a) Meeting Scheduled for April 14 ---------------------------------------------------------------- The U.S. Trustee for Region 21 will convene a meeting of creditors in Schuck-Baymeadows, LLC's Chapter 11 case on April 14, 2010, at 3:00 p.m. The meeting will be held at First Floor, 300 North Hogan Street, 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. Rexburg, Idaho-based Schuck-Baymeadows, LLC, filed for Chapter 11 bankruptcy protection on March 16, 2010 (Bankr. M.D. Fla. Case No. 10-02088). Jason B. Burnett, Esq., at GrayRobinson, P.A., 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 debts. The Company's affiliate, Villa Sangria-Baymeadows, LLC, filed a separate Chapter 11 petition on March 16, 2010, listing $10 million to $50 million in assets and $1 million to $10 million in liabilities. SMURFIT-STONE: Aurelius Insists on Finance II Liquidation --------------------------------------------------------- Smurfit-Stone Container Corp. and its U.S. affiliates are opposing a request by Aurelius Capital Management LP and Columbus Hill Capital Management LP for the U.S. Bankruptcy Court's conversion of the Chapter 11 case of Debtor Stone Container Finance Company of Canada II into to a case under Chapter 7 of the Bankruptcy Code. In response to the Debtors' objection, Scott D. Cousins, Esq., at Greenberg Traurig LLP, counsel to Aurelius, argues that the officers and directors of Finance II have done nothing to maximize the value of Finance II in the Chapter 11 cases. Mr. Cousins points out that instead of addressing relevant issues whether "cause" exists to convert Finance II's Chapter 11 case, the Debtors are mischaracterizing the process and the findings of the Canadian Bankruptcy Court in a transparent attempt to avoid addressing the relevant issues. Discovery Request In a separate filing, Aurelius Capital and Columbus Hill asked the Court to compel the Debtors to respond to document requests and produce witnesses in connection with discovery related to their request to convert the Chapter 11 case of Debtor Stone Container Finance Company of Canada II into to a case under Chapter 7 of the Bankruptcy Code. Counsel to the Debtors, James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, however, points out that the Court "is faced with a second bite at the apple from Aurelius after having initially lost in its chosen forum in Canada." He adds that instead of simply raising the issues in the context of their treatment under the Debtors' Chapter 11 Plan of Reorganization, Aurelius Capital engaged in a series of litigation "afterthoughts as it tries to impede the progress of the Debtors' chosen vehicle at any given hearing." Mr. Conlan adds that the Debtors have addressed Aurelius' discovery requests. After reviewing Aurelius Capital's and Columbus Hill's discovery request and the Debtors' responses, the Court ruled that the Debtors must produce documents related to: -- a certain intercompany loan agreement, including drafts and documents related to its purpose, negotiation and preparation; -- tax opinions provided in connection with the Intercompany Loan Agreement and unlimited liability company structure; and -- the tax returns for Finance II. An evidentiary hearing on the Conversion Motion was held on February 22, 2010, where Aurelius Capital and Columbus Hill sought to offer into evidence certain documents prepared in connection with the CCAA proceedings. After consulting with Aurelius Capital and Columbus Hill, the Debtors submitted two "Factum of the Applicants" to ensure that the record is complete. Copies of the two documents are available for free at: http://bankrupt.com/misc/SmrftFactmA.pdf http://bankrupt.com/misc/SmrftFactmB.pdf About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly US$7.450 billion in total assets and US$5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Aurelius Wants $200MM Claim Allowed for Voting ------------------------------------------------------------- Aurelius Capital Management LP and Columbus Hill Capital Management, L.P., as managers of certain funds that are beneficial holders of certain notes, ask the Court to: -- temporarily allow an intercompany claim asserting $200,677,778 against the estate of Smurfit-Stone Container Canada Inc., one of the Debtors for the purpose of voting on the Debtors' Chapter 11 Plan of Reorganization; -- temporarily allow a wind-up claim in an amount no less than $283,283,623 as a claim against the estate of Smurfit-Stone Container Enterprises, Inc., one of the Debtors, for the purpose of voting to accept or reject the Plan; -- classify the Intercompany Claim as a general unsecured claim against SSC Canada and the Wind-up Claim as a general unsecured claim against SSCE; and -- provide authority for Aurelius Capital and Columbus Hill to vote the Intercompany Claim and the Wind-up Claim. Scott D. Cousins, Esq., at Greenberg Traurig LLP, in Wilmington, Delaware, points out that the Plan is structured to avoid the voting of intercompany claims, therefore the Intercompany Claim and the Wind-up Claim are deprived of their voting rights. Pursuant to the Plan, the Intercompany Claim is classified by itself in Class 15F and is impaired and deemed to have rejected the Plan and, accordingly, is not entitled to vote. The Intercompany Claim's current treatment under the Plan provides that Finance II, as the holder of the Intercompany Claim, will not be entitled to receive any distributions on account of the Intercompany Claim. Pursuant to the Plan, the Wind-up Claim is classified as an intercompany claim against SSCE in Class 2F. Mr. Cousins notes that the Wind-up Claim's current treatment under the Amended Plan is somewhat ambiguous but does provide that Finance II, as the holder of the Wind-up Claim, will receive distributions on account of the claim if it is allowed. "The ambiguity in the [Plan] is whether those distributions are tied to the vote of creditors of two unrelated Debtors," Mr. Cousins says. However, under the Plan, unless the Wind-up Claim is allowed prior to the Voting Deadline, the Wind-up Claim will not have the right to vote on the Amended Plan. Debtors, Committee, and WTC Objects The Debtors, the Official Committee of Unsecured Creditors, and Wilmington Trust Company, as indenture trustee for certain notes that the Debtors issued, point out that Aurelius Capital and Columbus Hill are not the holders of the Intercompany Claim or the Wind-up Claim. James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, contends that Aurelius Capital and Columbus Hill have refused the Debtors repeated offers to allow them to pursue the Intercompany Claim and the Wind-Up Claim on behalf of the Finance II estate and have not filed a request to seek authority to assert the claims. Mr. Conlan argues that it is improper for Aurelius Capital and Columbus Hill to have the benefits of voting the Intercompany Claim and the Wind-Up Claim to reject the Plan without having undertaken the obligation of asserting those disputed claims against the Debtors. In order to solve the problem, the Debtors propose that the Court deem Aurelius Capital's and Columbus Hill's request as an assertion of the Intercompany Claim and the Wind-up Claim and schedule a hearing date and objection deadline in advance of the conclusion of the Confirmation Hearing. Mr. Conlan says that the Debtors have agreed to an extension of the Plan voting deadline for Aurelius Capital and Columbus Hill through the conclusion of the hearing on the allowance of the Intercompany Claim and the Wind-up Claim. Aurelius and Columbus Respond Mr. Cousins argues that rather than Finance II pursuing the Intercompany Claim and the Wind-up Claim because they are the valuable assets, Finance II and the other Debtors, who are "acting through their clearly conflicted counsel," have decided that the solution is to shift the burden of pursuing the Claims unto Aurelius Capital and Columbus Hill. "This approach is not appropriate and fails to alleviate the conflicts that make it impossible for Finance II's interests to be protected absent an independent fiduciary for Finance 11," Mr. Cousins says. He notes that "The Intercompany Claim and the Wind-up Claim belong to Finance II and it is the obligation of Finance II to pursue them." Mr. Cousins further asserts that it should not be the burden of Aurelius Capital and Columbus Hill, who do not have access to the Debtors' books, records and agents, who do not control Finance II's privilege, and who lack institutional knowledge, to defend and then pursue the claims on the merits as contemplated by the Debtors. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly US$7.450 billion in total assets and US$5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Shareholders Want Recovery; IRS Wants Interest ------------------------------------------------------------- Various parties have filed objections to confirmation of the Chapter 11 plan of reorganization for Smurfit-Stone Container Corp. Under the Plan, holders of up to $3.1 billion in unsecured claims against the operating companies are to receive the new common stock worth up to 71% of their claims. Secured creditors owed $969 million are to be paid in full in cash or new debt. Secured creditor CIT Group Inc. is to be paid fully on the $34.9 million it's owed. Unsecured creditors of the holding company owed $11.2 million are to receive nothing. Holders of interests in the holding company won't get anything. The Debtors are scheduled to present the Plan for confirmation on April 14. About 30 holders of Smurfit-Stone common stock object to the Plan because it extinguishes their equity interests. They pointed that: * the Debtors' assets exceed their debts; * cancellation of the shares is inequitable in that the Debtors will not receive a substantial benefit; and * the Debtors are fully solvent as evidenced by their ability to obtain financing and to continue operations undisturbed. The Internal Revenue Service objects to the non-payment of interest for priority tax claims should the Debtors opt to pay them over time. The IRS says the rate of interest for unpaid taxes is 4%, or 6% for certain large corporate underpayments. The Texas Comptroller of Public Accounts, which holds prepetition and postpetition tax claims, also complains about the non-payment of interest for tax claims. The Comptroller also wants penalties on any postpetition taxes not paid by the Debtors when due. Pee Dee Electric Cooperative, Inc., a non-profit electric Cooperative and provider of electrical services, says that it should be allowed to set off over $150,000 in capital credits. Ronal A. Tadel, a retiree, said funds should be allocated for retirees. Mr. Tadel asked the bankruptcy judge to protect the Retiree Interests "by allotting adequate funds from Michael Smurfit to once again bring our pension fund to the fully funded level so that we are not a burden to any other entity." Plan Supplements The Debtors submitted to the Court supplements to their Joint Chapter 11 Plan of Reorganization. The supplements include: -- Management Incentive Plans http://bankrupt.com/misc/SmrftRSCCInctvPlns.pdf -- Directors and Officers and Creditor Representative of Reorganized SSCC http://bankrupt.com/misc/SmrftRSCCOffcrs.pdf -- Directors and Officers of Reorganized Debtors other than Reorganized SSCC http://bankrupt.com/misc/SmrftRDbtrsBoard.pdf -- Asset Purchase Agreement (Canadian Asset Sale) http://bankrupt.com/misc/SmrftCanNewAPA.pdf -- Restructuring Transactions http://bankrupt.com/misc/SmrftRestTrans.pdf -- Exit Facility Documentation http://bankrupt.com/misc/SmrftExitFacDoc.pdf A copy of the Disclosure Statement, filed February 4, 2010, is available for free at http://bankrupt.com/misc/SmrftLtstDS.pdf A copy of the Plan, filed February 4, 2010, is available for free at http://bankrupt.com/misc/SmrftLtstPlan.pdf About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly US$7.450 billion in total assets and US$5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Wins Nod to Pay Arrangers of $650 Mil. Revolver -------------------------------------------------------------- Smurfit-Stone Container Corp. is seeking to obtain a $1.2 billion term loan facility and a $650 million revolving credit facility in order to exit Chapter 11. The Debtors have entered into agreements relating to the indemnification and fees and expenses of the financial institutions who will arrange the exit financing. At the request of Smurfit-Stone, the Bankruptcy Court has entered an order authorizing the Debtors to: (a) enter into a $650,000,000: * Senior Secured ABL Facility Commitment Letter with Deutsche Bank AG New York Branch, Deutsche Bank Securities Inc., JPMorgan Chase Bank, N.A., J.P. Morgan Securities Inc., certain other financial institutions that will also act in a capacity as lead arrangers and certain other financial institutions; * Senior Secured ABL Facility Agent Fee Letter with certain of the Agents; and * Senior Secured ABL Facility Joint Fee Letter with certain of the Agents; (b) pay certain fees and expenses set in the terms and conditions of, the ABL Facility Commitment Documents, provided that Calpine Corrugated LLC will not be responsible for any amounts in excess of amounts that are allocable to it on an equitable basis. If Calpine pays more than its share, it will have an administrative expense claim against the other Debtors for the excess amount; (c) furnish certain indemnities set in the terms and conditions of, the ABL Facility Commitment Documents; and (d) file under seal the Agent Fee Letter and the Joint Fee Letter. The Bankruptcy Court has earlier entered a separate order authorizing Smurfit to enter into an exit term loan facility engagement and arrangement letter and fee letter with JPMorgan Chase Bank, N.A., J.P. Morgan Securities, Inc., Deutsche Bank Securities Inc. and Banc of America Securities LLC, which constituted the first step in arranging the Debtors' contemplated $1,200,000,000 Term Loan Facility. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly US$7.450 billion in total assets and US$5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SOLUTIA INC: S&P Downgrades Rating on $1.15 Mil. Loan to 'BB-' -------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its issue- level rating on Solutia Inc.'s $1.15 billion senior secured bank credit facilities to 'BB-' from 'BB'. The rating action follows a $100 million increase in the company's term loan B facility commitment to $850 million. S&P also revised its recovery rating on the facilities to '3' from '2'. The senior secured facilities consist of a $300 million revolving credit facility and a $850 million term loan. Previously, on March 2, 2010, S&P assigned a '2' recovery rating and a 'BB' issue-level rating to the senior secured facilities based on the initial term loan B commitment of $750 million. The 'BB-' corporate credit rating on Solutia remains unchanged. The outlook remains stable. The '3' recovery ratings on both the revolving credit and term loan B facility indicate S&P's expectation for a meaningful (50%- 70%) recovery in the event of a payment default. The company used proceeds from these facilities primarily to refinance its existing asset-based lending and term loan B facilities. The 'BB-' issue level rating is at the same level as the corporate credit rating on Solutia. The 'B+' issue-level rating (one notch below the corporate credit rating) on Solutia's recent issuance of $300 million senior unsecured notes due 2020 remains unchanged. The recovery rating on the senior unsecured notes is '5', indicating S&P's expectation of modest (10%-30%) recovery in the event of a payment default. The issue-level rating on the company's $400 million senior unsecured notes due November 2017 remains 'B+' (one notch below the corporate credit rating on the company). The recovery rating on these notes remains unchanged at a '5', indicating S&P's expectation for modest (10%?30%) recovery in the event of a payment default. Following the divestiture of the low-margin nylon segment in 2009, St Louis-based Solutia's operations consist mainly of specialty businesses. The company's cost-competitive Saflex segment, which manufactures PVB interlayers and resins, contributes about 40% of revenues. PVB film imparts desired functionalities--such as enhanced strength, flexibility, and safety--to glass. The CPFilms business segment (about 10% of revenues) produces specialty films for use in windows, optical filters, and flat panel displays. The high-margin technical specialties segment (approximately 50% of revenues) consists of the insoluble sulfur (a vulcanizing agent for tires), heat-transfer fluids, aviation hydraulic fluids, and rubber chemicals business. These businesses result in a revenue base that is geographically diverse with about 75% of Solutia's revenue derived from markets overseas. Ratings List Solutia Inc. Corporate credit rating BB-/Stable/-- Ratings Lowered To From -- ---- $850 million term loan B due 2017 BB- BB Recovery rating 3 2 $300 million revolving credit facility due 2015 BB- BB Recovery rating 3 2 SPECIALTY PACKAGING: Can Hire Klehr Harrison as Co-Counsel ---------------------------------------------------------- Specialty Packaging Holdings, Inc., et al., sought and obtained permission from the Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware to employ Klehr, Harrison, Harvey, Branzburg & Ellers LLP, as co-counsel, nunc pro tunc to the Petition Date. Klehr Harrison will: a. advise the Debtors of their rights, powers and duties as debts and debtors-in-possession; b. take necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on the Debtors' behalf, the defense of any actions commenced against the Debtors, the negotiation of disputes in which the Debtors are involved and the preparation of objections to claims filed against the Debtors' estates; c. prepare motions, applications, answers, orders, reports and papers in connection with the administration of the Debtors' estates; and d. perform other necessary legal services in connection with the Debtors' Chapter 11 cases. Klehr Harrison will be paid based on the hourly rates of its personnel: Domenic E. Pacitti, Partner $500 Michael Yurkewicz, Of Counsel $365 Jennifer Patone Cook, Associate $250 Melissa K. Hughes, Paralegal $165 Domenic E. Pacitti, a partner at Klehr Harrison, assures that the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. The Debtors have also filed an application to employ Frost Brown Todd LLC as bankruptcy counsel. The Debtors intend Klehr Harrison to be Delaware co-counsel to the Debtors and to handle matters that the Debtors may encounter, if any, which cannot be handled by Frost Brown due to conflicts of interest or alternatively which can be more efficiently handled by Klehr Harrison. Lewisburg, Tennessee-based Specialty Packaging Holdings, Inc., is a color cosmetic developer and manufacturer. The Company, Cosmetic Specialties Inc. and affiliates filed for Chapter 11 bankruptcy protection on January 20, 2010 (Bankr. Del. Case No. 10-10142). Dominic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, assists the Company in its restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. The meeting of creditors pursuant to Section 341 of the Bankruptcy SPECIALTY PACKAGING: Can Hire Michael Musso as CRO -------------------------------------------------- Specialty Packaging Holdings, Inc., et al., sought and obtained permission from the Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware to employ Michael J. Musso as chief restructuring officer and interim chief executive officer; Steven Agran as assistant chief restructuring officer; and Morris- Anderson & Associates, L.P., to perform crisis management services, nunc pro tunc to the Petition Date. MA&A will, among other things: a. review and direct the development of the Debtors' financial budgets and related borrowing base reporting and projections, revenue and cash flow projections and all other financial and accounting information, records and systems related to the Debtors' operations; b. direct the Debtors' operations, including the efforts of other professionals in connection with the Debtors' financial restructuring, including all sale, refinancing, or liquidation activities; c. direct negotiations with, and reporting to, the Debtors' significant creditors; and d. manage the Debtors' sale of business process. MA&A will be paid based on the hourly rates of its personnel: Michael J. Musso $400 Steven Agran $375 Consultants $250-$325 Managing Directors $325-$450 Dan Dooley, Principal $495 Michael J. Musso, MA&A's managing director, assured the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Lewisburg, Tennessee-based Specialty Packaging Holdings, Inc., is a color cosmetic developer and manufacturer. The Company, Cosmetic Specialties Inc. and affiliates filed for Chapter 11 bankruptcy protection on January 20, 2010 (Bankr. Del. Case No. 10-10142). Dominic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, assists the Company in its restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. The meeting of creditors pursuant to Section 341 of the Bankruptcy SPECIALTY PACKAGING: Gets Final Nod to Obtain DIP Financing ----------------------------------------------------------- Specialty Packaging Holdings, Inc., et al., sought and obtained final approval from the Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware to obtain postpetition secured financing from a syndicate of lenders led by Bank of America, N.A., as administrative agent, and to use the cash collateral. On January 21, 2010, the Debtors obtained the Court's interim authorization from the Court to obtain DIP financing and use cash collateral. The final hearing on the Debtor's request was held on February 4, 2010, at 2:00 p.m. The DIP lenders have committed to provide revolving commitment amount of (i) up to $1,200,000, with respect to the period prior to entry of the final financing order; and (ii) $15,400,000, after the entry of the final financing order. Domenic E. Pacitti, Esq., at Klehr Yurkewicz, the attorney for the Debtors, explained that the Debtors need the money to fund their Chapter 11 cases, pay suppliers and other parties. The DIP facility will mature six months from the petition date. The Debtors will pay interest on the DIP facility at a rate per annum equal to the sum of the Base Rate from time to time in effect plus the Base Rate Margin (4%). In the event of default, the interest rate applicable to each overdue amount will be increased by 2% per annum. The DIP liens granted by the Agent include valid, binding, continuing, enforceable, first priority and fully perfected liens in all of the collateral; and super-priority, administrative expense claims. The DIP lien is subject to a carve-out for U.S. Trustee and Clerk of Court fees, and up to $175,000 in fees payable to professional employed in the Debtors' case and fees of the committee in pursuing actions challenging the DIP Lenders' lien. The Debtors are required to pay a host of fees to the Agent, including: (i) non-use fee, which is 0.50% of the Agent's Pro Rata Share of the unused amount of the revolving commitment amount; (ii) facility fee of 0.50% of $2,500,000 of the revolving commitment amount, or $12,500; (iii) an exit fee of 1.50% of $2,500,00 of the revolving amount, or $37,500; and (iv) an agent's fees, which are mutually agreed to from time to time between the Company and the Agent. A copy of the DIP financing agreement is available for free at: http://bankrupt.com/misc/SPECIALTY_PACKAGING_dipfinancingpact.pdf Mr. Pacitti said that the Debtors will also use the cash collateral to provide additional liquidity. The Debtors will use the collateral pursuant to a weekly budget, a copy of which is available for free at: http://bankrupt.com/misc/SPECIALTY_PACKAGING_budget.pdf In exchange for using the cash collateral, the Debtors will grant the pre-petition agent (BofA) adequate protection liens against and in all presently owned and hereafter acquired property, assets, and rights; and super-priority claims that will be subordinated only to the DIP liens and the carve-out amount. The Agent is represented by Mayer Brown LLP. Lewisburg, Tennessee-based Specialty Packaging Holdings, Inc., is a color cosmetic developer and manufacturer. The Company, Cosmetic Specialties Inc. and affiliates filed for Chapter 11 bankruptcy protection on January 20, 2010 (Bankr. Del. Case No. 10-10142). Dominic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, assists the Company in its restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. The meeting of creditors pursuant to Section 341 of the Bankruptcy SPRINT NEXTEL: Panel Sets 2010 Objectives as Free Cash Flow ----------------------------------------------------------- The Compensation Committee of the Board of Directors of Sprint Nextel Corporation established the 2010 objectives as free cash flow and net service revenue, weighted equally. According to the Troubled Company Reporter on Marc 8, 2010, the Compensation Committee set the performance objectives and other terms of the Company's 2010 Short-Term Incentive Plan for officers and other eligible employees of the Company. The Compensation Committee has established two six-month performance periods. The first period is from January 1, 2010, through June 30, 2010, and the second is from July 1, 2010, through December 31, 2010. Each performance period has discrete performance objectives, and employees must be employed on December 31, 2010, in order to be eligible to receive compensation for both periods. The 2010 STI Plan provides for a payment of incentive compensation to officers and other eligible employees based on the achievement of the following specified performance objectives during the first-half of 2010: adjusted OIBDA, weighted at 25%; a measure of retention of the company's post-paid wireless subscribers, which the company refers to as post-paid churn, weighted at 20%; net service revenue, weighted at 45%; and its subscribers on Clearwire's 4G network, which we call 4G subscribers, weighted at 10%. The Compensation Committee did not yet set performance objectives for the second-half of 2010. Each of the performance objectives will have a threshold, target and maximum level of payment opportunity. The maximum payment opportunity is equal to 200% of the individual's target opportunity. The award payment under the 2010 STI Plan will be determined based on the Company's results using three variables: * the individual's annual incentive target opportunity, which is based on a percentage of the individual's base salary; * the Compensation Committee's assessment and certification of Company performance compared with each of the above- referenced performance objectives; and * relative weightings for each performance objective. The determination of payments for certain executive officers will be made so as to comply with Section 162(m) of the Internal Revenue Code. Mr. Hesse's employment agreement provides for a target opportunity under the short-term incentive plan of not less than 170% of base salary -- or $2,040,000 for 2010 -- with actual payouts under the 2010 STI Plan limited to 200% of his targeted opportunity. Mr. Brust's employment agreement provides for a target opportunity under the STI Plan of not less than 130% of base salary -- or $1,300,000 for 2010. Mr. Cowan's employment agreement provides for a target opportunity under STI Plan of not less than 125% of base salary -- or $906,250 for 2010. Mr. Elfman's employment agreement provides for a target opportunity under STI Plan of not less than 125% of base salary == or $812,500 for 2010. Mr. Robert L. Johnson's employment agreement provides for a target opportunity under the STI Plan of not less than 100% of base salary -- or $460,000 for 2010. The actual incentive amounts paid under the 2010 STI Plan will be based on the Company's actual results during 2010 in relation to the established performance objectives, and these payments may be greater or less than the target amounts that have been established. Long-Term Incentive Compensation Plan for Mr. Brust On February 25, 2010, the Compensation Committee granted the 2010 awards for Mr. Brust under the Company's 2010 Long-Term Incentive Plan. The Compensation Committee has not yet set any of the terms of the 2010 LTI Plan with respect to any other officers or other eligible employees of the Company. Pursuant to the terms of his amended employment agreement, dated December 22, 2009, Mr. Brust's 2010 LTI Plan target opportunity of $3 million is allocated equally in value in stock options and restricted stock units all of which will vest on May 1, 2012, subject to compliance with non-compete and non-solicitation covenants under his employment agreement. The number of stock options granted is based on the value of each option determined using the Black-Scholes valuation model. The number of restricted share units awarded is based on the 30-day average trading price of the Company's common stock. The stock option grants and restricted stock unit awards, as applicable, will be made pursuant to the Company's 2007 Omnibus Incentive Plan. Special Payment On Feb. 25, 2010, the Compensation Committee also approved a lump- sum payment to Mr. Elfman in the amount of $300,000 related to his successful leadership of the Ericsson transaction, which was completed in 2009. About Sprint Nextel Overland Park, Kansas-based Sprint Nextel Corporation -- http://www.sprint.com/-- offers a comprehensive range of wireless and wireline communications services bringing the freedom of mobility to consumers, businesses and government users. Sprint Nextel is widely recognized for developing, engineering and deploying innovative technologies, including two wireless networks serving more than 48 million customers at the end of the third quarter of 2009 and the first and only 4G service from a national carrier in the United States; industry-leading mobile data services; instant national and international push-to-talk capabilities; and a global Tier 1 Internet backbone. As of September 30, 2009, the company had $55.648 billion in total assets against $37.414 billion in total liabilities. As of September 30, 2009, the company had $5.9 billion in cash, cash equivalents and short-term investments and $1.6 billion in borrowing capacity available under its revolving bank credit facility, for total liquidity of $7.5 billion. * * * Sprint Nextel carries Moody's Investors Service's Ba1 corporate family rating and Standard & Poor's Ratings Services' BB issuer credit rating. SQUARETWO FINANCIAL: Moody's Assigns 'B2' Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service assigned a first time B2 Corporate Family Rating to SquareTwo Financial Corporation. Concurrently, Moody's assigned a B2 Senior Secured rating to SquareTwo's proposed $300 million Senior Secured Second Lien notes. The outlook for the ratings is stable. SquareTwo's ratings incorporate several credit weaknesses including the monoline nature of the company's operations, its relatively weak financial position, dependence on secured funding, vulnerability to model risk in cash flow forecasting and portfolio valuation, and rapid growth in recent years. However, Moody's also notes the company's extensive track record and unique franchise-based collections network in the fragmented charged-off credit card collections industry. The company is relatively highly leveraged and has significant negative tangible net worth, which constrains its financial flexibility," said Moody's Vice President and Senior Analyst Curt Beaudouin. "However, SquareTwo's network of attorney-owned franchises has proven to be an efficient collections model for the company" The monoline nature of SquareTwo's operations presents an important constraint on the ratings. The purchased accounts receivable business is highly sensitive to macroeconomic forces and current collections environment remains challenging due to continued high unemployment and financially stressed U.S. consumers. These factors, in combination with the company's relatively weak financial position, create significant constraints on SquareTwo's financial flexibility (although the extended maturity profile of the company's debt after this note issuance partially mitigates liquidity-related concerns). SquareTwo's business is also subject to model risk regarding cash flow forecasting and portfolio valuation in the absence of readily obtainable market values. For example, lower than forecast collections cause impairment charges, which reduce earnings and capital formation and cause earnings volatility. Rapid growth, similar to that experienced by SquareTwo in 2005-2008, exacerbates impairment risk. Also, although well managed to date, the company faces event risk regarding litigation and/or legislative action. Moody's recognizes that the nationwide franchise-based collections model, built up over the company's 16 year history, has contributed to SquareTwo's development into one of the leading players in the charged off consumer debt management business. Moody's also takes favorable note of SquareTwo's experienced management team, although a number of members of senior management have limited tenure at the company. The rating for the Senior Secured Notes is the same as the Corporate Family Rating. This reflects the fact that the notes comprise the preponderance of the company's capital structure, as well as the strong asset coverage enjoyed by the company's Senior Secured First Lien debt (represented by a revolving credit facility). The rating outlook is stable, reflecting Moody's expectations that the company will continue to exhibit satisfactory performance. SquareTwo Financial Corporation is a purchaser of charged off credit card and other consumer debt receivables which pursues collections via a network of franchises. The company is headquartered in Denver, CO. SQUARETWO FINANCIAL: S&P Assigns 'B' Counterparty Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned a 'B' counterparty credit rating to SquareTwo Financial Corp. The outlook is stable. At the same time, S&P assigned a 'B' rating to the company's proposed issuance of $300 million in senior secured second-lien notes with a recovery rating of '4'. The rating on these notes is subject to a satisfactory review of the final documentation. "S&P's ratings on SquareTwo reflect the company's modest earnings, negative tangible equity, concentrated business model, and reliance on third parties for regulatory compliance," said Standard & Poor's credit analyst Brendan Browne. The company's market position as one of the largest buyers of "fresh" credit card receivables and the efficiencies created by its franchise model are positive rating factors. Favorable market conditions for purchasing credit card receivables and an improving economy also offer ratings support. The stable outlook assumes earnings and collections increase moderately amid attractive market conditions for purchases, reflecting S&P's expectation for a modest improvement in the U.S. economy. STARPOINTE ADERRA: Can Sell Condominium Unit 2083 for $288,000 -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona authorized Starpointe Aderra Condominiums Limited Partnership to sell its condominium unit 2083 to Cindy and David Price for $288,252. The sale of unit 2083 will result in net proceeds after costs of sale of $271,410, which sum will be paid to CCS Arizona II, LLC, a secured creditor, at closing. The Court also approved the payment of a 3% brokerage fee at closing of each transaction to Starpointe Marketing Concepts, LLC, the Debtor's broker to market the sale of its condominium units. Scottsdale, Arizona-based Starpointe Aderra Condominiums Limited Partnership is an upscale community of 312 homes in 13 three- storey buildings. The Company filed for Chapter 11 bankruptcy protection on December 29, 2009 (Bankr. D. Ariz. Case No. 09- 33625). Warren J. Stapleton, Esq., at Osborn Maledon, 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. STRATUS TECHNOLOGIES: Moody's Assigns 'B3' Corporate Family Rating ------------------------------------------------------------------ Moody's Investors Service assigned to Stratus Technologies Bermuda Ltd. a Corporate Family Rating of B3 and Probability of Default Rating of B3. Concurrently, Moody's assigned a B2 rating to Stratus Technologies' proposed $215 million Senior Secured Notes due 2015 offering. The rating outlook is stable. The ratings were assigned in connection with Stratus Technologies' proposed debt issuance which will be used to retire its existing 1st lien term loan and revolving credit facility. The senior notes are secured by substantially all assets of the company and its guarantor subsidiaries. The company will also use excess cash to pay down its 2nd lien term loan to $77 million from $102 million, and whose maturity date will be extended to June 2015 with a paid-in-kind interest rate of 9% pursuant to the notes transaction. The assigned ratings are subject to review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. The B3 corporate family rating reflects Stratus Technologies's small scale and the challenges associated with the product transition from the declining legacy Continuum servers to the ftServer lines, which have yet to gain the traction originally anticipated, and the newer Avance software product, which currently accounts for an insignificant piece of total sales ($128 thousand for the nine months ended November 22, 2009). Moody's believe the high availability server market is extremely competitive with principal competitors having far greater resources (e.g., IBM, Hewlett-Packard, Dell and NEC) to adapt to a rapidly-evolving IT landscape. In addition, the rating is constrained by relatively high leverage (adjusted Debt to EBITDA of 6.1 times which could grow as a result of PIK interest accretion on the 2nd lien term loan). At the same time, the B3 rating is supported by the company's recurring services revenue stream (more than two-thirds of total revenues) arising from the high attach rates on server sales and maintenance renewal rates which have exceeded 90% over the last several years. The strong customer retention from its blue chip customer base reinforces the critical nature of the company's continuous availability solutions on mission-critical applications, which has helped the company maintain steady profitability (adjusted EBITDA) despite the economic recession and sharp declines in product revenues. The B2 rating on the proposed senior secured notes is one notch higher than the company's CFR, which reflects the senior position of the secured notes in the Company's pro forma capital structure and the protection provided by the indenture's collateral package. The stable outlook reflects Moody's expectation that Stratus will continue to generate consistent EBITDA levels and modest free cash flow while achieving revenue growth in the ftServer line and Avance software business as the economy slowly recovers in 2010. These ratings/assessments were assigned: * Corporate Family Rating -- B3 * Probability of Default Rating -- B3 * $215 Million Senior Secured Notes due 2015 -- B2 (LGD-3, 37%) With U.S headquarters in Maynard, Massachusetts, Stratus Technologies is a provider of fault-tolerant server products and related services for mission-critical applications. Principal shareholders include Investcorp International, Inc., MidOcean Partners, and Intel Capital. Revenue for the twelve months ended November 22, 2009, was $213 million. TITLEMAX HOLDINGS: Full-Payment Plan Set for April 12 Hearing ------------------------------------------------------------- Carla Main at Bloomberg News reports that Titlemax Holdings LLC is scheduled to present its Chapter 11 plan for approval at a confirmation hearing on April 12. According to the report, the Plan promises to pay all creditors in full. Secured lender Merrill Lynch Mortgage Capital Inc., owed $149.5 million, will be paid off with a new, two-year note. Subordinated noteholders owed $4.7 million will receive new notes. General unsecured creditors with $2.5 million in claims likewise will be paid in full, with interest. Savannah, Georgia-based Titlemax Holdings LLC dba TitleMax, TitleBucks, US TitlePawn, American Title, and CheckMax is a Closely held title-lending company with about 550 locations in seven states -- Georgia, South Carolina, Tennessee, Mississippi, Missouri, Virginia and Illinois. It holds customers' vehicle titles in exchange for cash. The Company was founded in 1998 and has 1,800 employees. The Company and its affiliates filed for Chapter 11 protection on April 20, 2009 (Bankr. S. D. Ga. Lead Case No. 09-40805). DLA Piper LLP represents the Debtors in its restructuring efforts. The U.S. Trustee for Region 21 appointed seven creditors to serve on the official committee of unsecured creditors. Titlemax has assets and debts both ranging from $100 million to $500 million. TLC VISION: Wins Approval of Disclosure Statement ------------------------------------------------- Dawn McCarty reports that TLC Vision Corp. is sending its reorganization plan to creditors for voting after it received approval of the explanatory disclosure statement. As reported by the TCR on Feb. 22, 2010, the Plan provides for the distribution of the proceeds derived from the sale of the Debtors' assets. Holders of secured will receive full payment. Holders of general unsecured claims will also be paid in full -- 90% in cash, and the remaining 10% through a note. In the original iteration of the Plan, holders of general unsecured claims against TLC USA were to recovery only recover 10%. A full-text copy of the amended Disclosure Statement is available for free at http://bankrupt.com/misc/TLCVision_AmendedDS.pdf A full-text copy of the amended Plan of Reorganization is available for free at: http://bankrupt.com/misc/TLCVision_AmendedPlan.pdf TLCVision -- http://www.tlcvision.com/-- is North America's premier eye care services company, providing eye doctors with the tools and technologies needed to deliver high-quality patient care. Through its centers' management, technology access service models, extensive optometric relationships, direct to consumer advertising and managed care contracting strength, TLCVision maintains leading positions in Refractive, Cataract and Eye Care markets. TLC Vision (USA) Corporation, and two of its corporate affiliates filed petitions for Chapter 11 on Dec. 21, 2009 (Bankr. D. Del. Case No. 09-14473). The petition says assets and debts are $100 million to $500 million. The Company's lead U.S. restructuring counsel is the law firm of Proskauer Rose LLP and Canadian restructuring counsel is the law firm of Torys LLP. The Company's financial advisor is Conway Del Genio Gries & Co., LLC. Epiq Bankruptcy Solutions is claims and notice agent. TOPSPIN MEDICAL: Kost Forer Raises Going Concern Doubt ------------------------------------------------------ On March 23, 2010, Topspin Medical, Inc., filed its annual report on Form 10-K for the year ended December 31, 2009. Kost Forer Gabbay & Kasierer, in Tel Aviv, Israel, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that in the last quarter of 2008, the Company terminated the employment of most of its employees and suspended its operational activities and that, in addition, the Company has incurred losses in the amount of NIS 1,676,000 during the year ended December 31, 2009, and has an accumulated deficit in the amount of NIS 182,117,000 as of that date. The Company reported a net loss of NIS 1,676,000 (roughly US$426,181) for the year ended December 31, 2009, compared to a net loss of NIS 20,150,000 (roughly US$5,616,255) in 2008. The Company did not have any revenues in 2009 or 2008. The Company's balance sheet as of December 31, 2009, showed NIS 1,312,000 in assets and NIS 2,488,000 of debts, for a stockholders' deficit of NIS 1,176,000. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c18 Based in Givataim, Israel, TopSpin Medical, Inc. was until October 2008, when activities were suspended due to financial considerations, engaged through its wholly-owned Israeli subsidiary, TopSpin Medical (Israel) Ltd., in the design, research, development and manufacture of imaging devices that utilize MRI technology by means of miniature probes for various body organs. TRUMP ENTERTAINMENT: Court to Decide on Exit Plan by Mid-April -------------------------------------------------------------- Dow Jones Daily Bankruptcy Review says the U.S. Bankruptcy Court for the District of New Jersey will decide by mid-April who gets Trump Entertainment Resorts Inc. -- Carl Icahn or bondholders led by Avenue Capital Management. A 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. The Troubled Company Reporter, citing Steven Church at Bloomberg reports, said on March 12, 2010, that lawyers for Icahn indicated at the last day of the two-week confirmation hearing that the bankruptcy court should confirm the Icahn plan because it is superior to the bondholder-backed plan of Donald Trump. According to Bloomberg, Jeffrey Jonas, lawyer for Mr. Icahn, said the noteholder plan is based on faulty revenue projections and will leave the Company with new financial problems within a few years. Under Icahn's plan the company would exit bankruptcy without any debt. Bloomberg said Trump Entertainment balked at the Icahn plan, noting that it gives up everything to Icahn and the secured lenders, while noteholders owed $1.2 billion would be wiped out. 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 TRUVO SUBSIDIARY: Gets Consent to Commence Debt Restructuring ------------------------------------------------------------- Elliott Associates, L.P., said that it welcomes the announcement by Truvo Subsidiary Corp. that it has obtained consent under the Senior Facilities Agreement to commence debt restructuring negotiations with holders of its notes. Elliott holds 32% of the Notes and also holds a significant position in Truvo's Senior loans and is a significant holder of credit default swap protection referencing Truvo Subsidiary Corp. Elliott's positions in Truvo are subject to change without notice. About Elliott Elliott's two funds, Elliott Associates, L.P. and Elliott International, L.P., together have more than $16 billion of assets under management. The funds' investors include institutions, foundations, endowments, pensions, high net worth individuals, and family offices. The 33-year-old trading firm is one of the oldest of its kind under continuous management. About Truvo Subsidiary Truvo Intermediate Corp., the parent of Truvo Subsidiary Corp., is, through its subsidiaries, the leading directory publisher in Belgium, Ireland and Romania. Through its joint venture with Portugal Telecom, the company is the leading directory publisher in Portugal and, through its minority interests, holds leading positions in the directory markets in South Africa and Puerto Rico. In 2008, the group generated consolidated revenues of EUR318.5 million and EBITDA of EUR159.9 million under IFRS. * * * As reported in the Troubled Company Reporter on December 18, 2009, Moody's Investors Service downgraded the Corporate Family Rating of Truvo Subsidiary Corp to Caa3 from Caa2, and its Probability of Default Rating to Caa2 from Caa1. At the same time, Moody's downgraded to Ca from Caa3 the ratings of the EUR395 million and US$200 million senior notes due 2014 issued by Truvo. The outlook for all the ratings is negative. The downgrade reflects Moody's concerns about the group's challenging operating environment and the resulting continuing impact on its financial risk profile, together with the decreased recovery prospects for debt holders in the case of distress. UAL CORP: Invests on 50 Widebody Aircraft to Reduce Costs --------------------------------------------------------- United Air Lines, Inc., has formalized a commitment originally announced in December 2009, signing a firm order for 25 A350-900 XWB aircraft, the newest twin-engine widebody from Airbus. The aircraft will be powered by Rolls-Royce Trent XWB engines. Deliveries of the aircraft will begin in 2016 and run through 2019. "This is the latest chapter in a very strong relationship that has spanned two decades," said John Leahy, Airbus Chief Operating Officer - Customers. "From the delivery of the first United A320 in November 1993 to today, Airbus and United have worked together successfully to weather challenging market periods. It's a true testament to what the A350 XWB has to offer that one of the largest airlines in the world has selected it to be an instrumental part of their future." "With this order we are investing in United's future, gaining a widebody aircraft that will help us reduce operating costs while still providing state-of-the-art comfort to our customers," said John Tague, President of United Airlines. "The A350 XWB will also help us reduce fuel burn and our overall environmental footprint in comparison to older technology aircraft." Mark King, President - Civil Aerospace, Rolls-Royce, added: "This represents a significant endorsement of our Trent XWB technology and its operational advantage. We are delighted that United Airlines has put its trust in the long-term performance advantages of Trent technology and TotalCare(R)." The A350 XWB is a new family of mid-size widebody airliners. The highly efficient aircraft brings together the latest in aerodynamics, design and advanced technologies to provide a 25- percent step-change in fuel efficiency compared to current aircraft in the same size category. The A350 XWB airframe will have 53 percent composite materials, lightening the weight thereby maximizing fuel economy. Featuring an entirely new, very quiet, cabin with extra space and comfort, passengers will enjoy more headroom, wide panoramic windows and more overhead storage area. The three passenger versions have true long-range capability and flexibility. The A350-800 will fly 270 passengers in a three- class configuration 8300 nautical miles. The 314-seat A350-900 and 350-seat A350-1000 will offer similar long-range performance. The order book for the aircraft type now stands at 530 aircraft. Final assembly of the first aircraft is anticipated in 2011, with the first delivery (of an A350-900) scheduled for 2013. Twenty Five 787-8 Jetliners Boeing [NYSE: BA] and United Air Lines, Inc. [Nasdaq: UAUA] said at the end of February that they have finalized an order for 25 787-8 jetliners. The agreement includes the opportunity to purchase another 50 Dreamliners. "Boeing and United Airlines share an 80-year partnership," said Jim Albaugh, president and CEO of Boeing Commercial Airplanes. "United, which launched the Boeing 777, now begins a new chapter with the 787 Dreamliner, the most technologically advanced commercial jetliner ever built." The order is valued at $4.2 billion at average list prices. "United's Boeing 787 order represents a substantial investment in our future and will enhance the significant progress we are making in improving the global competitiveness of our company while providing the opportunity to open new profitable markets and serve a broader range of international destinations," said John Tague, president of United Airlines. United expects to take delivery of the 787s at the same time it will begin to retire its Boeing 747s and 767s operating on international routes. The 787 Dreamliner, currently in flight test, will provide greater fuel efficiency, allowing airlines to add new, nonstop city pairs and the additional frequencies that passengers prefer. The 787 also promises a more comfortable flying experience for passengers. Its innovations include a new interior environment with improvements in air filtration, higher cabin pressurization resulting in reduced physical fatigue, larger windows, more stowage space, improved lighting and other passenger-preferred conveniences. The technologically advanced 787 will also provide airlines with up to 45 percent more cargo revenue capacity. Including United Airlines, 57 customers around the world have ordered 876 Dreamliners, making the 787 the fastest-selling new commercial jetliner in history. Aircraft to be Delivered Between 2016 and 2019 UAL Corp. Executive Vice President and Chief Financial Officer Kathryn Mikells told the Securities and Exchange Commission on February 25, 2010 and March 11, 2010, that the 25 Boeing 787-8 Dreamliner aircraft and 25 Airbus A350 XWB aircraft are expected to be delivered between 2016 and 2019. After giving effect to these orders, United has total capital commitments, both aircraft and non-aircraft related, of about $8.0 billion, of which about $0.2 billion, $0.2 billion, $0.1 billion, $0.1 billion, $0.1 billion and $7.3 billion are due in 2010, 2011, 2012, 2013, 2014 and thereafter, Ms. Mikells discloses. Any incremental firm aircraft orders will increase United's total future capital commitments, she notes. Ms. Mikells states that the Boeing and Airbus aircraft order is part of United's international fleet replacement program which provides for retirement of its international Boeing 747s and 767s between 2016 and 2019. United estimates that it will reduce its fuel costs and carbon emissions from the 25 Boeing 787-8 Dreamliner aircraft and 25 Airbus A350 XWB aircraft combined by about 33% compared with the aircraft they will replace. In addition, United expects average lifetime maintenance costs for the 25 Boeing aircraft and 25 Airbus aircraft combined to be approximately 40% lower per available seat mile compared with the aircraft they will replace. The new aircraft will also enable service to a broader range of international destinations while providing customers with state-of-the-art cabin comfort, she maintains. About UAL Corporation Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for Chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors. Judge Eugene R. Wedoff confirmed a reorganization plan for United on Jan. 20, 2006. The Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) UAL Corp. carries a 'Caa1' probability of default rating from Moody's, 'B-' long term foreign issuer credit rating from Standard & Poor's, and 'CCC' long term issuer default rating from Fitch. UAL CORP: Reports February 2010 Traffic Results ----------------------------------------------- United Air Lines, Inc., reported its preliminary consolidated traffic results for February 2010. Total consolidated revenue passenger miles (RPMs) increased in February by 2.1% on a decrease of 5.3% in available seat miles (ASMs) compared with the same period in 2009. This resulted in a reported February consolidated passenger load factor of 78.7%, an increase of 5.7 points compared to 2009. For February 2010, consolidated passenger revenue per available seat mile (PRASM) is estimated to have increased 17.0% to 19.0% year over year. Consolidated PRASM is estimated to have increased 3.8% to 5.8% for February 2010 compared to February 2008, 2.9 percentage points of which was due to growth in ancillary revenues. The company estimates that weather related cancellations in February from the severe storms that affected the East coast reduced February revenue by approximately $40 million. In addition, the company estimates a benefit to PRASM of approximately 1.5 points from storm-related reductions in ASMs and the impact of the Lufthansa strike on trans-Atlantic loads. Storm-related cancellations accounted for 3.5 percentage points of the 5.3% year-over-year decline in consolidated ASMs for the month of February, and are expected to reduce consolidated ASMs for the first quarter 2010 by approximately 1.0 percentage point. United reported a U.S. Department of Transportation on-time arrival rate of 79.5% in February. Average February 2010 mainline fuel price, including gains or losses on settled fuel hedges and excluding non-cash, mark-to- market fuel hedge gains and losses, is estimated to be $2.25 per gallon. Including non-cash, mark-to-market fuel hedge gains and losses, the estimated fuel price is $1.64 per gallon for the month. 2010 2009 Percent Feb. Feb. Change ----- ----- ------- Revenue passenger miles ('000) North America 3,929,502 4,084,182 (3.8%) Pacific 1,518,158 1,405,668 8.0% Atlantic 1,012,424 975,398 3.8% Latin America 259,552 286,069 (9.3%) Total International 2,790,134 2,667,135 4.6% Total Mainline 6,719,636 6,751,317 (0.5%) Regional Affiliates 1,098,381 908,220 20.9% Total Consolidated 7,818,017 7,659,537 2.1% Available seat miles ('000) North America 4,859,647 5,295,138 (8.2%) Pacific 1,869,166 2,027,931 (7.8%) Atlantic 1,413,483 1,491,646 (5.2%) Latin America 317,984 400,813 (20.7%) Total International 3,600,633 3,920,390 (8.2%) Total Mainline 8,460,280 9,215,528 (8.2%) Regional Affiliates 1,470,262 1,275,545 15.3% Total Consolidated 9,930,542 10,491,073 (5.3%) Load factor North America 80.9% 77.1% 3.8 pts Pacific 81.2% 69.3% 11.9 pts Atlantic 71.6% 65.4% 6.2 pts Latin America 81.6% 71.4% 10.2 pts Total International 77.5% 68.0% 9.5 pts Total Mainline 79.4% 73.3% 6.1 pts Regional Affiliates 74.7% 71.2% 3.5 pts Total Consolidated 78.7% 73.0% 5.7 pts Revenue passengers boarded ('000) Mainline 3,721 3,968 (6.2%) Regional Affiliates 1,939 1,714 13.1% Total Consolidated 5,660 5,682 (0.4%) Cargo ton miles (000) Freight 130,545 89,891 45.2% Mail 14,890 17,182 (13.3%) Total Mainline 145,435 107,073 35.8% Pursuant to SEC Regulation G, the Company has included the following reconciliation of reported non-GAAP financial measures to comparable financial measures reported on a GAAP basis. Since the Company does not apply cash flow hedge accounting, the Company believes that the net fuel hedge adjustments provide management and investors with a better perspective of its performance and comparison to its peers because the adjustments reflect the economic fuel cost during the periods presented and many of our peers apply cash flow hedge accounting. February 2010 ------------- Mainline fuel price per gallon excluding non-cash, net mark-to-market gains and losses $2.25 Add: Non-cash, net mark to market (gains) and losses per gallon (0.61) Mainline fuel price per gallon 1.64 About UAL Corporation Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for Chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors. Judge Eugene R. Wedoff confirmed a reorganization plan for United on Jan. 20, 2006. The Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) UAL Corp. carries a 'Caa1' probability of default rating from Moody's, 'B-' long term foreign issuer credit rating from Standard & Poor's, and 'CCC' long term issuer default rating from Fitch. US FIDELIS: Sec. 341 Meeting Scheduled for April 5 -------------------------------------------------- Nancy J. Gargula, the U.S. Trustee for the Eastern District of Missouri, will convene a meeting of creditors of US Fidelis, Inc., on April 5, 2010, at 2:00 p.m. The meeting will be held at the Office of the United States Trustee, Thomas F. Eagleton U.S. Courthouse, 111 South Tenth Street, Twenty-second Floor, Room 22.304, in St. Louis, Missouri. 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. 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: U.S. Trustee Names 4-Member Creditors' Panel -------------------------------------------------------- Nancy J. Gargula, the U.S. Trustee for the Eastern District of Missouri, appointed four members to the official committee of unsecured creditors in the bankruptcy case of US Fidelis Inc., pursuant to 11 U.S.C. Section 1102(a): -- Capital Assurance Risk Retention Group (CARRG), In Receivership Attn: Douglas A. Hartz as Deputy Receiver 4353 Tuller Road, Bldg. L Dublin, OH 43017 -- Coleman Consulting Attn: Frank Pereira, VP 1101 Fifth Street, Suite 345 San Rafael, CA 94901 -- Ashcroft Law Firm Attn: James Pierce 13321 N. Outer 40, Suite 300 St. Louis, MO 63017 Rhoderick Beery, III 6415 Winding Ridge Circle Lincoln, NE 68512 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. VAUGHAN COMPANY: Founder Faces SEC Fraud Charges ------------------------------------------------ The Securities and Exchange Commission has filed fraud charges against a New Mexico realtor and obtained an emergency court order to halt his $80 million Ponzi scheme. The SEC's complaint, filed in federal court in Albuquerque, alleges that Douglas F. Vaughan through his company -- The Vaughan Company Realtors -- issued promissory notes that he claimed would generate high fixed returns for investors. Mr. Vaughan also used another entity -- Vaughan Capital LLC -- to solicit investors for different types of real estate-related investments, such as buying residential properties at distressed prices. Mr. Vaughan relied entirely on new money raised from investors through both companies to fund Vaughan Company's ever-increasing obligations to note holders. The SEC also charged both of Mr. Vaughan's companies in the enforcement action. Neither Mr. Vaughan nor his companies are registered with the SEC to offer securities under the federal securities laws. "Vaughan exploited his prominence in the Albuquerque business community to add legitimacy to his scheme and lure investors," said Donald M. Hoerl, Director of the SEC's Denver Regional Office. "When the scheme unraveled, Vaughan hid behind the economic downturn and blamed the poor real estate market for his demise." The Honorable M. Christina Armijo for the U.S. District Court for the District of New Mexico on Tuesday evening granted the SEC's request for a temporary restraining order and asset freeze against Mr. Vaughan and his companies. According to the SEC's complaint, Mr. Vaughan defrauded approximately 600 investors, promising them high, fixed interest payments ranging from 10% to 25% over one to three years. He misrepresented that the aggregate principal on the Vaughan Company notes would not exceed a certain limit. Mr. Vaughan falsely claimed that the notes were "secured" by certain real estate and his personal wealth, and that Vaughan Company used investor funds to generate profits well in excess of its obligations on the notes. The SEC's complaint alleges that Mr. Vaughan's failing business accumulated losses totaling more than $61 million, and the $80 million in principal owed to investors is 20 times the claimed equity in the properties that were to secure the notes. The SEC also alleges that Mr. Vaughan's net worth, which was supposed to provide protection to investors, is negative in value. In direct violation of promises made, Mr. Vaughan transferred almost all of the money he raised from Vaughan Capital investors to Vaughan Company's operating account. He then used those funds to cover Vaughan Company's obligations to promissory note holders and its ordinary business costs. The SEC's complaint charges the defendants with violating the securities registration and antifraud provisions of the federal securities laws, and charges Mr. Vaughan and Vaughan Company with acting as an unregistered broker-dealer. The complaint seeks permanent injunctions, disgorgement of ill-gotten gains and financial penalties. The SEC's investigation is ongoing. VERIZON COMMS: S&P Puts Rating on New Comms. Sr. Unsec. Notes ------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its issue- level and recovery ratings to the proposed senior unsecured notes due 2017 and 2020, to be issued by New Communications Holdings Inc., a subsidiary of Verizon Communications Inc. (A/Negative/A-1) but which will ultimately be merged into Stamford, Conn.-based Frontier Communications Corp. (BB/Stable/--). S&P rated the notes 'BB' (the same as the corporate credit rating on Frontier and based entirely upon Frontier's credit quality pro forma for the transaction). S&P has also assigned the notes a recovery rating of '3', which indicates expectations for meaningful (50%-70%) recovery in the event of payment default. Additionally, S&P assigned a 'BB' issue-level rating and '3' recovery rating to Frontier's proposed $750 million senior unsecured revolver due 2014. S&P also affirmed all other ratings on Frontier, including the 'BB' corporate credit rating. The ratings are based on the pro forma entity, including the expectation that total leverage will be about 3x at transaction close. The outlook is stable. The new unsecured notes will fund a special cash distribution to Verizon and pay related fees and expenses prior to the spin-off of New Communications Holdings and merger with Frontier as part of the acquisition of about 4.2 million access lines. The notes will be issued under rule 144A with registration rights. If the merger agreement is terminated, the notes will be redeemed by Frontier at the issue price plus accrued interest. Noteholders will not have any recourse to Verizon Communications or any of its subsidiaries. S&P expects Frontier's total funded debt to be about $8 billion. "The ratings on Frontier continue to reflect rising competition from cable telephony and wireless substitution, the lack of a facilities-based video strategy, currently high leverage, and integration risk related to the acquisition of the Verizon properties," said Standard & Poor's credit analyst Allyn Arden. Tempering factors include the company's solid position as an incumbent local exchange carrier, primarily in less competitive rural areas; relatively stable cash flow and high margins; modest growth in high-speed data services, which has helped mitigate revenue declines from line losses; and the deleveraging effect of Verizon transaction. VISTEON CORP: Equity Holders Claim Plan Ignores True Value ---------------------------------------------------------- Dewey & LeBoeuf LLP, acting on behalf of Ad Hoc Equity Committee, sent a letter to the Board of Directors of Visteon Corporation. Following is the full text of the letter: March 25, 2010 Board of Directors of Visteon Corporation c/o Kirkland & Ellis LLP 601 Lexington Avenue New York, NY 10022 Attn.: Jamie Sprayregen, Esq. Marc Kieselstein, Esq. Re: In re Visteon Corporation, Chapter 11 Case No. 09-11786 (Jointly Administered) (CSS) Dear Members of the Board of Directors: As you know, we represent an ad hoc committee of equityholders (the "Ad Hoc Equity Committee"), the members of which collectively hold 7.87% of the outstanding common stock of Visteon Corporation (the "Company" or "Visteon"). (1) The Company's most recently proposed chapter 11 plan, dated March 15, 2010 (the "Plan"), completely ignores the true value of the Company and, accordingly, wrongfully extinguishes shareholders and must be revised. Delaware corporate law requires a shareholder vote to sell substantially all Visteon's assets, but the Company is undertaking to effectuate the same result as a transfer of virtually all of Visteon's assets to certain creditors without a shareholder vote. As with the initial chapter 11 plan proposed by the Company, the recent Plan is based on an unrealistically low valuation of the Company and its assets and a suboptimal capital structure, which together provide an indefensible windfall to the Company's secured lenders at the expense of the Company's other creditors and shareholders. The Ad Hoc Equity Committee's analysis shows the Company is worth significantly more than the Plan and Disclosure Statement would lead the Court, creditors, and equityholders to believe for the following reasons, among others: First, as pointed out in our letter dated March 8, 2010, the Company's prior projections must be viewed with a healthy dose of skepticism. (2) Relative to the improving macroeconomic picture, consensus assumptions for worldwide production volume growth in the industry and the improving market positions of the Company's largest customers, the Company's top line projections appear to present an unreasonably low revenue forecast. Second, given the Company's successful cost cutting (including exiting all of the Company's US manufacturing operations, which will have the effect of lowering manufacturing costs significantly) and general margin improvement illustrated in Q3 and Q4 of 2009, it appears the projections do not reflect the operational improvements the Company has achieved. Third, the Company's valuation of its equity in its non- consolidated joint ventures is far below their fair market value. The Company values all these joint ventures at $195 million or about 5 times 2009 dividends, 2.5 times 2009 net income and 65% of 2009 book value. Our financial advisors are willing to provide you with numerous examples of comparable Asian automotive suppliers, which currently trade at forward net income multiples in the teens. If the Company truly considers $195 million to be a fair value for its non-consolidated joint ventures, the Ad Hoc Equity Committee recommends the Company offer these assets to the Ad Hoc Equity Committee at that price. Fourth, the Company inappropriately values its 70% stake in Halla Climate Control Corporation ("Halla") on a consolidated basis (using a market multiple in-line with US comparables, not the higher multiples afforded to Halla's Asian competitors), and then subtracts out the market value of the 30% of Halla not owned by the Company. This creates an artificial, negative multiple arbitrage that results in a lower valuation. Halla's value should not be up for debate or manipulation, as shares of Halla trade publicly; at the most recent closing price of Halla shares at current exchange rates, Visteon's stake in Halla is worth $915 million before any premium for Visteon's control position. A proper valuation of Halla would assign a premium to the current trading price for Visteon's controlling interest in this valuable enterprise. The Company's position that its 70% stake is worth ratably less than the 30% minority stake is not only incorrect but is also troubling. Put simply, the sum of the Company's $1.1 billion of cash on its balance sheet as of December 31, 2009, its $915 million stake in Halla (before including a control premium) and the Company's overly-conservative valuation of the non-consolidated joint ventures is in excess of the Company's estimated valuation in the Plan, before including any value for Visteon's core business, which the Ad Hoc Equity Committee, Ford and the Company's other customers firmly believe has value. Furthermore, using a reasonable valuation of both the Company's non-consolidated joint ventures and Visteon's core business (ex-Halla) together with the Company's cash and the public market value of Halla would result in a total valuation well in excess of the $3.1 billion of total claims against the Company, leaving significant value for shareholders. (3) The Ad Hoc Equity Committee is eager to learn more about the Company's motivations and processes by which it arrived at its valuations and reserves all rights to seek discovery on this issue and all issues. Additionally, there are more optimal capital structures which preserve, create, and distribute value more fairly to all of the Company's stakeholders. Any such structure should reinstate the existing bank debt or provide the bank debtholders with a new note at the lowest interest rate the law allows, and we urge the Company to do so. Based on the Ad Hoc Equity Committee's projected cash flows (and even using the Company's onerously conservative projections), Visteon has ample cash flows to support both this interest expense as well as annual contributions to its domestic pension plans. Furthermore, the Company will generate significant cash over the projection period to address future maturities. Therefore, the notion that Visteon must be free of long-term debt is an unreasonable view that directly robs equityholders of value resulting from the preservation of the Company's bank debt at an attractive interest rate. There are many comparable companies in the automotive sector, domestically and internationally, that have debt. Indeed, several of these comparable companies have emerged from bankruptcy with leverage and yet continue as important suppliers to Ford as well as to other Visteon customers. The Company should also consider distributing shares of Halla to its guaranteed note holders. While the Ad Hoc Equity Committee believes there is great value to the Company's majority ownership in and control of Halla, the Ad Hoc Equity Committee also believes there is very little incremental value or strategic benefit from owning 70% of Halla, as opposed to owning 51%. Finally, the Company should satisfy remaining unsecured bonds with a combination of cash and convertible preferred securities. Cash can come from either excess balance sheet cash, or a $200 million rights offering. (4) The convertible preferred securities should contain a mandatory dividend payable in securities at the Company's option at an appropriate rate, be callable at the Company's option, and be convertible into common equity in certain circumstances. Such a structure would enable Visteon to reinstate its existing equity (subject, of course, to dilution for the rights offering, if necessary, a management incentive plan, and the convertible preferred securities described above). Designed properly, such a structure ought to preserve the value of the Company's significant net operating losses. The Ad Hoc Equity Committee reserves its rights to seek termination of exclusivity to propose a plan and/or seek the appointment of an examiner to protect its interests, as well as all other rights granted by the Bankruptcy Code. The appointment of an examiner may be particularly appropriate given the wide gulf between the Company's prior projections and actual results, the limited changes made in the Plan, and the issues the Company's Plan raises as to whether the Company and its Board are carrying out their fiduciary duties. Of course, the Ad Hoc Equity Committee's preference is to work collaboratively with the Board, management, and the Company's other stakeholders to ensure a consensual chapter 11 plan that treats all stakeholders fairly, and rewards management for improved performance. The shareholders are the Company's owners, and we trust the Board and management will act in accordance with the shareholders' best interests consistent with their fiduciary duty. We look forward to your response. Sincerely, Martin J. Bienenstock MJB/ds (1) The members of the Ad Hoc Equity Committee may also hold other Visteon securities from time to time. (2) As we noted in our letter, the projections in the Disclosure Statement, dated December 17, 2009, issued in support of the debtors proposed plan just two weeks before the end of the 2009 fiscal year, egregiously understated actual income and cash as of the end of 2009. Additionally, the Company's projections did not materially change from December 17, 2009 to March 15, 2010 notwithstanding its proven understated 2009 projections. (3) The Company improperly considers only "excess cash" as part of its valuation, and not "total cash". We are well advised by the Company that much of the Company's $1.1 billion of cash is located overseas and not able to be repatriated without tax consequences and understand that dividends from the Company's affiliates which are not wholly-owned are uncertain. But neither of these facts allows the Company to simply ignore the value of these assets and hand them over to senior creditors at the expense of other stakeholders to whom it owes fiduciary obligations to preserve value. (4) While the Ad Hoc Equity Committee doesn't believe the Company needs additional liquidity, the Ad Hoc Equity Committee is willing to demonstrate its fundamental belief that the present Plan undervalues the Company by agreeing to participate in such a rights offering. The rights offering would be offered first to existing equity holders and then to unsecured claimholders if they would like to participate. To ensure full subscription, the members of the Ad Hoc Equity Committee will consider backstopping the rights offering, which would be subject to standard and customary conditions. About Visteon Corporation Visteon Corporation is a leading global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers. With corporate offices in Van Buren Township, Mich. (U.S.); Shanghai, China; and Chelmsford, UK; the company has facilities in 25 countries and employs approximately 29,500 people. 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) WOLVERINE TUBE: Amendment to Indenture With BNA is Effective ------------------------------------------------------------ David A. Owen, Senior Vice President, Chief Financial Officer and Secretary of Wolverine Tube, said the amendment to the Indenture dated April 28, 2009, with U.S. Bank National Association as Trustee and Collateral Agent relating to the Company's 15% Series Unsecured Notes due 2012 became effective. About Wolverine Tube Wolverine Tube, Inc., is a global manufacturer and distributor of copper and copper alloy tube, fabricated products, and metal joining products. The Company currently operates seven facilities in the United States, Mexico, China, and Portugal. It also has distribution operations in the Netherlands and the United States. At October 4, 2009, the Company had total assets of $192,632,000 against total liabilities of $240,277,000; Series A Convertible Preferred Stock of $17,674,000; Series B Convertible Preferred Stock of $9,700,000; and total accumulated deficit of $75,019,000. Going Concern Doubt In its quarterly report for the three months ended October 4, 2009, the Company believes that its available cash and cash anticipated to be generated through operations is expected to be adequate to fund the Company's liquidity requirements, although there can be no assurances that the Company will be able to generate such cash. Additionally, the Company does not currently have in effect a revolving credit agreement or other capital commitments to supplement its existing cash and anticipated cash resources, if necessary, to meet its liquidity requirements materially in excess of the Company's current expectations. According to the Company, the uncertainty about the Company's ability to achieve its projected results, the absence of such credit or capital commitments and the uncertainty about the future price of copper, which has a substantial impact on working capital, raises substantial doubt about the Company's ability to continue as a going concern. The Company expects to continue to actively manage and optimize its cash balances and liquidity, working capital, operating expenses and product profitability, although there can be no assurances the Company will be able to do so. W.R. GRACE: BNSF Appeal on Royal Settlement Stayed -------------------------------------------------- Judge Ronald L. Buckwalter of the U.S. District Court for the District of Delaware ruled that the stipulation for the automatic stay with respect to the appeal of BNSF Railway Company is granted. BNSF Railway Company, among others, took an appeal from Bankruptcy Judge Fitzgerald's order approving in all respects, the settlement and mutual release agreement with Arrowood Indemnity Company, as corporate successor-in-interest to Royal Indemnity Company, Arrowpoint Capital Corp., and Royal Indemnity Company. The settlement and mutual release agreement, which pertains to late-year excess policies allegedly issued by Royal to certain of the Debtors on account of asbestos-related claims, provides that Arrowood pay a settlement amount reflecting alleged liabilities for amounts one or more of the Debtors are or may become liable for certain asbestos claims. Accordingly, BNSF's Appeal is stayed until further notice, the District Court ruled. About W.R. Grace Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Court Approves Fees for July-September -------------------------------------------------- Bankruptcy Judge Judith Fitzgerald allowed the fee applications of these professionals for the period from July 1 through September 30, 2009: Professional Fees Expenses ------------ ---- -------- Anderson Kill & Olick, P.C. $1,199,112 $22,671 David T. Austern 37,850 2,148 Janet S. Baer, P.C. 474,822 14,490 Baker Donelson Bearman Caldwell & Berkowitz 60,000 34 Beveridge & Diamond, P.C. 15,799 593 Bilzin Sumberg Dunn Baena Price & Axelrod 114,222 104,133 Blackstone Advisory Services L.P. 450,000 17,086 BMC Group 98,364 6,722 Campbell & Levine, LLC 189,711 59,538 Caplin & Drysdale, Chartered 1,997,400 300,217 Capstone Advisory Group, LLC 361,641 3,506 Casner & Edwards LLP 39,699 38,364 Charter Oak Financial Consulting LLC 43,775 0 Day Pitney LLP 34,342 48 Duane Morris LLP 210,367 3,687 Ferry Joseph & Pearce, P.A. 101,584 8,798 Foley Hoag LLP 42,333 145 W.D. Hilton 16,537 0 Holme Roberts & Owen, LLP 938 2,926 Kirkland & Ellis LLP 6,407,674 1,166,546 Kramer Levin Naftalis & Frankel LLP 169,905 20,322 Legal Analysis Systems, Inc. 300,425 4,833 Ogilvy Renault LLP C$51,643 C$1,184 Orrick, Herrington & Scutcliffe LLP 1,674,330 57,172 Pachulski Stang Ziehl & Jones LLP 251,421 195,318 Phillips, Goldman & Spence, P.A. 57,460 2,418 Piper Jaffrey & Co. 150,000 182 PricewaterhouseCoopers LLP 500,691 9,955 Protiviti Inc. 38,280 3,846 Reed Smith LLP 110,343 47,361 Alan B. Rich 202,402 16,828 Alexander M. Sanders, Jr. 62,415 3,904 Saul Ewing LLP 100,164 1,885 Stroock & Stroock & Lavan LLP 942,116 47,520 Towers Perrin Tillinghast 5,747 0 Venable LLP 491,292 295,440 Warren H. Smith & Associates, P.C. 48,506 932 Woodcock Washburn LLP 21,576 180 The Court's approval of the Fee Applications is based on the recommendations submitted by Warren H. Smith & Associates, P.C, acting in its capacity as fee auditor in the Debtors' cases. The Fee Auditor's final report was subsequently amended to remove the fee application of Tre Angeli LLC, which was not filed in sufficient time to be heard for the Fee Application Period. About W.R. Grace Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Settles Asbestos Property Damage Claims --------------------------------------------------- W.R. Grace & Co. and its units submitted to the Court copies of separate agreements reached with these claimants to settle their claims asserting property damage allegedly caused by W.R. Grace & Co.'s manufacture, use or sale of asbestos-containing products. The Debtors and the Claimants averred that they negotiated in good faith to reach the Settlement Agreements to allow the Asbestos Property Damage Claims in these total settlement amounts: Allowed Claim No. Claimant Claim Amount -------- -------- ------------ 12368 McMaster University $725,578 12396 Fairview Leaseholds, Inc. 266,885 11322, 11323, Hamilton Wentworth 11678, 11680, District School Board 223,624 11681, 11682, and 11684 12533 Conseillers Immobiliers GWL Inc. 166,340 12490 Atlantic Shopping Centres LTD 112,279 12329 University of Guelph 62,191 12427 Morguard Investments Limited 53,558 12304 Toronto District School Board 38,567 12346 City of Vancouver 16,455 12493 Health Care Corp. of St. John's 7,713 About W.R. Grace Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) XERIUM TECHNOLOGIES: Reports $96.8-Mil. 4th Quarter Net Loss ------------------------------------------------------------ Xerium Technologies, Inc., reported results for its fourth quarter ended December 31, 2009: -- Net sales for the 2009 fourth quarter were $132.4 million, an 11.4% decrease from net sales for the 2008 fourth quarter of $149.5 million. Excluding currency effects, fourth quarter 2009 net sales decreased 20.5% from the fourth quarter of 2008, with declines of 19.5% and 22.4% in the clothing and roll covers segments, respectively. -- Net loss for the fourth quarter of 2009 was $96.8 million or $1.98 per diluted share, compared to a net loss of $4.3 million or $0.09 per diluted share for the fourth quarter of 2008. -- Adjusted EBITDA (as defined by the Company's amended credit facility) was $16.1 million for the fourth quarter of 2009, compared to $24.6 million for the fourth quarter of 2008. -- Cash on hand at December 31, 2009, was $23.0 million, compared to $21.8 million at September 30, 2009 and $34.7 million at December 31, 2008. -- Total bank debt at December 31, 2009, increased to $640.1 million from $628.6 million at September 30, 2009, primarily due to the Company terminating, on December 31, 2009, all of its outstanding interest rate swaps in the amount of $20.0 million and converting them into notes payable, partially offset by debt payments of approximately $5.4 million and favorable currency effects of approximately $3.2 million. As a result of the interest rate swap termination, the interest rate on the term loan portion of the credit facility is no longer effectively fixed through December 31, 2010, the original term of the swaps, exposing the Company's financial results to interest rate fluctuations, both favorable and unfavorable. At December 31, 2009, the Company had total assets of $693.511 million, total debt of $640.121 million and stockholders' deficit of $119.657 million. A full-text copy of the Company's earnings release is available at no charge at http://ResearchArchives.com/t/s?5c1e "We are encouraged by the ongoing signs of recovery that we're seeing throughout the paper industry, as demand begins to gain strength," said Stephen R. Light, President, Chief Executive Officer and Chairman. "We are experiencing steady and gradual improvement in our order bookings as conditions appear to be stabilizing or improving in most of our geographies. We are optimistic that as bookings increase, sales growth will follow." About Xerium Technologies Based in Raleigh, North Carolina, Xerium Technologies, Inc. (NYSE: XRM), manufactures and supplies two types of consumable products used primarily in the production of paper: clothing and roll covers. The Company, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 32 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,300 employees. XERIUM TECHNOLOGIES: To Decide on Restructuring Path by March 31 ---------------------------------------------------------------- Stephen R. Light, President, Chief Executive Officer and Chairman of Xerium Technologies, Inc., said on Wednesday the Company will decide whether to pursue an in-court or out-of-court restructuring on or before March 31, 2010. As reported by the Troubled Company Reporter, Xerium on March 2, 2010, announced that it commenced a solicitation of lender votes in support of a proposed joint prepackaged plan of reorganization under chapter 11 of the U.S. Bankruptcy Code. The solicitation reflects an agreement in principal, supported by the steering committee of lenders under the Company's senior secured credit facility and the parties to the Company's swap termination agreements, under which approximately $620 million of existing debt would be exchanged for approximately $10 million in cash, $410 million in new term loans maturing in 2015, and approximately 82.6% of the common stock of Xerium. Existing shareholders would retain a meaningful minority equity ownership interest in the Company of approximately 17.4% of the common stock and receive warrants to purchase up to an additional 10% of the common stock. In addition, the Company would enter into a new revolving loan of up to $20 million and a term loan of $60 million. The precise equity ownership split between the lenders and the existing shareholders, as well as the amount of term and revolver debt, is subject to adjustment based upon certain conditions. On March 22, 2010, the solicitation period concluded, at which time sufficient votes to accept the Plan had been received to implement the Plan through a court-supervised process, although not the unanimous lender vote required for reorganization without court supervision. Mr. Light said, "We are in the process of completing the next steps in reducing our debt load by means of a debt for equity exchange with our lenders. The Company's plan preserves meaningful value for our current equity shareholders. We are prepared to implement our restructuring by voluntarily seeking court approval for the prepackaged reorganization already approved by an overwhelming majority of our lenders during our recently completed solicitation period. The next element of our process involves trying to achieve the backing of the remainder of the lenders for the approved plan. Should court action be deemed the preferred implementation path for the plan, we would expect to enter and exit that part of our restructuring process quickly. On February 26, 2010, the Company secured from certain of its lenders a third extension, since September 29, 2009, of its existing temporary loan covenant waivers, until April 1, 2010. The lenders extended the existing loan covenant waivers to facilitate continued negotiations for a comprehensive recapitalization of the Company. Pursuant to the extension, certain lenders agreed to extend the previous waivers of any defaults resulting from the Company's failure to comply with certain financial covenants under its credit agreement for the quarters ended September 30, 2009 and December 31, 2009, and to waive any defaults under agreements creating the Company's existing hedging obligations and to extend the forbearance thereof. Additionally, the February 26, 2010 waiver permanently waived the requirement that the Company's audited financial statements for the year ended December 31, 2009 be accompanied by an audit opinion unqualified as to "going concern." On November 18, 2009, the Company was notified by NYSE Regulation, Inc., that the Company was not in compliance with the New York Stock Exchange standard for continued listing of its common stock because the average closing price of its common stock was less than $1.00 per share over a consecutive 30 trading day period. This notification represents the second instance that the Company was not in compliance with this criterion in the past 12 months. On December 29, 2008, the Company was first notified by NYSER that, in addition to not being in compliance with this criterion, the Company also was not in compliance with the total market capitalization requirement of at least $50 million over the same consecutive 30 trading day period. The NYSE is reviewing this second instance of noncompliance under the $1.00 share price standard in connection with its broader assessment of the Company's progress on its previously submitted 18-month business plan in order to determine the appropriate action. The Company has been in continuing discussions with NYSER regarding its financial status, listing status and potential chapter 11 filing and will seek to continue the NYSE listing of its common stock. There can be no assurance that NYSER will not take delisting actions against the Company notwithstanding its efforts, and thus there can be no assurance that the Company's common stock will continue to be listed on the NYSE. According to Mr. Light, "As we have done throughout the many months of this carefully planned course of action, we continue to work closely with our customers, employees, suppliers and all other stakeholders to assure them that the pending restructuring is simply a balance sheet restructuring with limited impact on our ability to conduct business as usual. "We look forward to completing the final stages of this balance sheet restructuring. With a substantially reduced debt load, we believe we can complete this entire process as a stronger company fully focused on our operating strategy of introducing new products that our customers value and maximizing the contribution of our employees to earn the highest customer loyalty in our served market." About Xerium Technologies Based in Raleigh, North Carolina, Xerium Technologies, Inc. (NYSE: XRM), manufactures and supplies two types of consumable products used primarily in the production of paper: clothing and roll covers. The Company, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 32 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,300 employees. * Moody's: PE-Backed Firms Have High Defaults, Potential Recovery ----------------------------------------------------------------- Nearly half of U.S. non-financial corporates that defaulted in 2009 have private-equity backing, which could benefit creditors, Moody's Investors Service said. "The presence of private equity may benefit creditors during periods of distress and default because their access to capital, strong relationships within the capital markets and financial sophistication give them tools to preserve value despite illiquidity and economic challenges," said Christina Padgett, senior vice president at Moody's. "Conversely, when a company is performing well private equity sponsors often increase leverage to fund distributions to shareholders, which can weaken the position of creditors." Creditors to private equity-backed companies that defaulted in 2009 could fare better because these defaults were more likely to be distressed exchanges and prepackaged bankruptcies. In the past, these default events have provided better recoveries for creditors than Chapter 11 filings or missed interest payments, Moody's said. In its review of 2009 corporate defaults, Moody's found the majority involved leveraged buyouts consummated at the top of the credit cycle. "Most defaulted companies with private equity backing were established as the credit bubble inflated, suggesting they were weighed down by leverage that could not withstand the subsequent economic and credit crisis," said Padgett. "Fifty-four of the 77 defaults by private equity-backed companies in 2009 were rated for the first time in 2005 or thereafter, with the most coming in 2007 -- probably the height of the credit bubble." In general, future recoveries could benefit from an improving economy, more fluid capital markets and, consequently, lower defaults. However, Moody's said, there is some reason for caution because of the high volume of defaults in 2009, uncertain market conditions, substantial longer-term refinancing risk for speculative-grade companies and the potential for additional restructurings. One notable exception to Moody's expectations for more favorable recoveries for private equity-backed issuers is mega-deals executed during the credit bubble with high acquisition multiples and leverage. The report, "Private Equity 2009: Nearly Half of Defaults But Prospects for Better-Than-Average Recoveries," is available on http://www.moodys.com/ * Greenberg Traurig's UK Unit Expands Restructuring Practice ------------------------------------------------------------ Greenberg Traurig Maher LLP, the firm established in London by international law firm Greenberg Traurig, LLP, disclosed the addition of two new shareholders, Paul Atherton and Jason Salman, to its expanding UK Restructuring Practice. In addition, Helena Potts has joined the firm as an associate in the practice. Atherton joins Greenberg Traurig Maher from Kirkland & Ellis LLP, and brings with him comprehensive experience in restructuring, corporate recovery, and insolvency. He has acted for financial institutions as well as for directors, creditors, debtors and insolvency practitioners on a variety of global restructuring matters. Mr. Salman also joins Greenberg Traurig Maher from Kirkland & Ellis LLP. He has extensive experience in restructuring matters, having focused on intricate international financial restructurings, acting for corporate debtors, financial creditors, directors and insolvency practitioners. Ms. Potts has joined Greenberg Traurig Maher from Kirkland & Ellis LLP. She is experienced in complex cross-border restructuring and insolvency matters, with a particular expertise in the employment and pension implications of business restructurings and insolvencies. "Paul, Jason and Helena are important additions to our Restructuring Practice in London. Their hiring furthers our ability to meet the needs of our clients in today's uncertain global economy," said Paul Maher, Chairman of Greenberg Traurig Maher. "Under the strong leadership of Lyndon Norley, our UK Restructuring head, we are putting together a team that can provide guidance to creditors and debtors in complex restructurings and insolvencies." "We are excited to welcome Paul, Jason and Helena to our global team," said Bruce R. Zirinsky, Co-Chair of Greenberg Traurig's Business Reorganization and Bankruptcy Practice. "Their presence in London strengthens our transatlantic restructuring capabilities and I look forward to working with them." About Greenberg Traurig Greenberg Traurig Maher LLP was established in 2009 in the UK by international law firm Greenberg Traurig, LLP. Greenberg Traurig Maher's rapidly expanding office provides shareholder-led advice to domestic and international clients on a range of matters across the legal spectrum. Lawyers at Greenberg Traurig Maher advise UK and multinational clients operating in many different sectors, including chemicals, pharmaceuticals, life sciences, energy, real estate, financial services, information services, automotive, entertainment, retail and communications. About Greenberg Traurig Greenberg Traurig, LLP is an international, full-service law firm with approximately 1775 attorneys serving clients from more than 30 offices in the United States, Europe and Asia. In the U.S., the firm has more offices than any other among the Top 20 on The National Law Journal's 2009 NLJ 250. In the U.K., the firm operates as Greenberg Traurig Maher LLP. Additionally, Greenberg Traurig has strategic alliances with the following independent law firms: Studio Santa Maria in Milan and Rome, TA Lawyers GKJ in Tokyo, and Weber Law Office in Zurich. The firm was Chambers and Partners' USA Law Firm of the Year in 2007 and among the Top 3 in the International Law Firm of the Year. * Kirkland's Labovitz Earns Spot on Law360's Lawyers to Watch ------------------------------------------------------------- Whether helping devise a plan to keep Tousa Inc. in the business of selling homes while in bankruptcy or restructuring Solutia Inc.'s European bonds out of court using an arcane Belgian law, Kirkland & Ellis LLP partner Natasha Labovitz knows the importance of creativity and collaboration in restructuring work, earning her a spot on Law360's list of 10 bankruptcy attorneys under 40 to watch. * BOOK REVIEW: Ten Cents on the Dollar, Or the Bankruptcy Game -------------------------------------------------------------- Author: Sidney Rutberg Publisher: Beard Books Softcover: 189 pages List Price: $34.95 Reporting on bankruptcy courts for more than 30 years for Fairchild Publications and also as a business columnist and editor for Women's Wear Daily and Daily News Record, Rutberg came away with a jaundiced view of bankruptcies. Perhaps because he was a journalist covering events in a fast-paced, urban environment, Rutberg writes in an informal, breezy style. Ten Cents on the Dollar reads like a gossip column with its witty and colorful observations. Rutberg recounts situations and incidents in rapid- fire succession, offering tidbits of information with no logical, chronological, or narrative connection. Rutberg's stories are, however, grouped into general headings relating to various aspects of bankruptcy. Among these are liquidation auctions; creditors; legal procedures; Chapter 7, 11, and 13 bankruptcies; and key players in bankruptcies, such as accountants and lawyers. Rutberg's irrepressibly casual, often inventive, style extends to the names of the chapters. The first chapter on auctions is titled "A Kipper Is Not a Herring." Another chapter is entitled "Ten Cents on the Dollar, Or Reading Between the Lies." "Even Millionaires Go Broke" is the title of a third. Rutberg's casual style belies the fact that he has an unerring, seasoned eye for what bankruptcy, the bankruptcy system, and the individuals -- from debtors to judges -- are like. Ten Cents on the Dollar, first published in 1973, offers a balanced perspective based on firsthand knowledge. The informal style does not undermine the basic points Rutberg makes about bankruptcy; for example: "Professionals who play the bankruptcy game [like professionals in other fields] . . . lie a little, they cheat a little, they steal a little, but mostly they work hard." Elsewhere, Rutberg writes that, while "[a]ttorneys in the bankruptcy field are looked upon by some . . . [as being] rungs below the ambulance-chasing negligence lawyer . . . the bankruptcy lawyer is a specialist in a rough-and-tumble business, and, by and large, he'll perform as well as the attorneys in any other specialized field." While Rutberg does not pull punches, he avoids passing judgment on the bankruptcy field and its participants. If this book had been no more than a screed, it would have been of little use to readers who wanted to learn something about bankruptcy. Rutberg, for instance, is not calling for reform. There are enough other books doing this. Individuals on both sides of the bankruptcy issue will be amused by Rutberg's informal writing style, stream of vignettes, and jaundiced point of view. For those foreseeing or initiating bankruptcy, it is an informative guide not only to various options and requirements, but also to the players. Readers who are not involved in the bankruptcy business can learn how they might profit from bankruptcy proceedings, such as purchasing property at an auction or providing services to those in bankruptcy. Rutberg's book is intended for lay readers, and not bankruptcy professionals such as attorneys and accountants. But for everyone else, from business owners and decisionmakers to investors and individuals looking for depressed-priced items, Ten Cents on the Dollar is a wide-ranging, incisive picture of the bankruptcy game. Besides being a columnist and journalist concentrating on financial affairs, Sidney Rutberg is a contributing editor to the magazine The Secured Lender, published by the Commercial Finance Association. ********* 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 ***