/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100526.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, May 26, 2010, Vol. 14, No. 144 Headlines ACCESS PHARMACEUTICALS: Has $1.6MM Operating Loss for 1st Quarter AFFINION GROUP: Loyalty Business Deal Won't Affect Moody's Rating AIMS WORLDWIDE: Posts $878,577 Net Loss in Q1 2010 AMERICAN HOSPITALITY: Section 341(a) Meeting Set for June 10 AMERICAN INSULOCK: Chapter 11 Petition Filed AMERICAN NATURAL: Posts $645,398 Net Loss for March 31 Quarter AMH HOLDINGS: S&P Raises Corporate Credit Rating to 'B-' ANPATH GROUP: Files for Chapter 11 With Prepack Plan B-VVI LLC: Section 341(a) Meeting Scheduled for June 17 BEAR STEARNS: Cioffi Asks Court to Release Collateral BILLY SCHWYHART: Judge Barry Dismisses Chapter 11 Case BLACK RAVEN: Swings to $99,000 Net Loss in Q1 2010 BROWN PUBLISHING: Newspapers Up for Auction on June 28 BRUNSWICK CORPORATION: Moody's Gives Stable Outlook; Keeps Ratings CALYPTE BIOMEDICAL: Delays Filing of Quarterly Report on Form 10-Q CAPMARK FINANCIAL: Fitch Withdraws 'D' Issuer Default Rating CARROLE COLLINS: Case Summary & 18 Largest Unsecured Creditors CENTAUR LLC: Plan Contemplates Restructuring of Credit Deals CHARLES FORD: Case Summary & 20 Largest Unsecured Creditors CHEMTURA CORP: In Talks With Unsecureds & Equity Holders on Plan CHINA IVY: Posts $352,811 Net Loss in Q1 2010 CHINA TRACTOR: Posts $2.8 Million Net Loss in Q1 2010 CHINA VOICE: Posts $496,541 Net Loss in Q3 Ended March 31 CHINA YOUTH MEDIA: Posts $1.06-Mil. Net Loss in Q1 2010 CHRYSLER LLC: 50 Former Dealers Drop Arbitration Cases CHRYSLER LLC: Marchionne Says New Chrysler May Go Public in 2011 CHRYSLER LLC: New Chrysler Repositions Agency Responsibilities CHRYSLER LLC: New Chrysler to Cooperate With NHTSA Investigation CHRYSLER LLC: New Chrysler Wary of GM Plan to Reclaim Ally Fin'l CIENA CAPITAL: Credit Suisse Objects to FCA Settlements CINCINNATI BELL: Moody's Corrects Rating on Senior Bonds to 'B2' CINCINNATI BELL: S&P Assigns 'BB' Rating on $970 Mil. Notes CIRCUIT CITY: Claim Transfers for April 2010 CIRCUIT CITY: Sues Avenues in Leather to Seek $628,000 CIRCUIT CITY: Sues Schimenti to Avoid $814,000 CMG HOLDINGS: Swings to $68,441 Net Income in Q1 2010 CNO FINANCIAL: Fitch Affirms All Ratings, Gives Stable Outlook COLONIAL BANCGROUP: FDIC Wants Case Converted to Chapter 7 COOPER-STANDARD: Expects to Exit Chapter 11 Tomorrow CORD BLOOD: Posts $2.5 Million Net Loss for March 31 Quarter CRC HEALTH: Moody's Downgrades Corporate Family Rating to 'B3' DAVID STORTS: Case Summary & 22 Largest Unsecured Creditors DOVEVIEW LLC: Section 341(a) Meeting Scheduled for June 11 DUQUESNE LIGHT: Moody's Affirms 'Ba1' Senior Unsecured Ratings EAU TECHNOLOGIES: Posts $223,271 Net Loss for March 31 Quarter EFP, INC.: Case Summary & 6 Largest Unsecured Creditors EMISPHERE TECHNOLOGIES: Posts $18.4MM Net Loss for March 31 Qtr FALLON LUMINOUS: Court Reconsiders Recent Order on Infringement FIRST DATA: May 13 Amendment Won't Affect Fitch's 'B' Rating FONAR CORP: Posts $8,000 Net Loss in Q3 Ended March 31 FRASER PAPERS: Signs Agreement to Sell New Hampshire Paper Mill GATEWAY ETHANOL: Court Extends DIP Loan Expiry Until May 31 GENERAL DATACOMM: Posts $1.2 Million Net Loss for March 31 Quarter GENERAL GROWTH: Wins Confirmation of Last Property-Owning Unit GENESIS FLUID: Posts $1.2 Million Net Loss in Q1 2010 GEORGE PAGLIARO: Section 341(a) Meeting Scheduled for June 16 GREEKTOWN HOLDINGS: Casino April Revenues Total $31.9 Million GREEKTOWN HOLDINGS: Receives Court Nod to Hire PGH & HAG GSI GROUP: Schedules May 27 Plan Confirmation Hearing GUNDLE/SLT ENVIRONMENTAL: Moody's Junks Corporate Family Rating HARRISBURG, PA: Agency to Miss $1.4-Mil. June 1 Debt Payment HYRDROL-PRO TECHNOLOGIES: Case Summary & Creditors List INFOLOGIX INC: Posts $2.8 Million Net Loss for March 31 Quarter IXI MOBILE: Delays Filing of Quarterly Report on Form 10-Q LA JOLLA PHARMACEUTICAL: Posts $1,767,000 Net Loss in Q1 2010 LANDRY'S RESTAURANTS: S&P Retains Negative Watch on 'B' Rating LARRY SPANN: Case Summary & 20 Largest Unsecured Creditors L.A.J. INC.: Case Summary & 11 Largest Unsecured Creditors LYONDELL CHEMICAL: Professionals Takes Home $50M for Work MACH GEN: S&P Affirms 'BB-' Rating on $100 Mil. Facility MALDEN BROOK: Voluntary Chapter 11 Case Summary MARY BEESON: Case Summary & 4 Largest Unsecured Creditors MEDAFOR INC: CryoLife Sends Letter to Firm's Shareholders MESA AIR: Judge Delays Breakup of Delta Service Contract MICHAEL FOODS: Moody's Reviews 'B1' Corporate Family Rating MICHAEL FOODS: S&P Puts 'B+' Rating on CreditWatch Negative MONDRIAN TTL: Section 341(a) Meeting Scheduled for June 8 MPM TECHNOLOGIES: Posts $386,000 Net Loss for March 31 Quarter MSGI SECURITY: Posts $4.3 Million Net Loss for March 31 Quarter NEFF CORP: Seeks to Retain Deloitte Tax as Tax Advisor NEW DEVELOPMENT: Moody's Assigns 'Ba3' Rating on $1.4 Bi. Notes NEW DEVELOPMENT: S&P Assigns 'BB-' Rating on $1.4 Bil. Loan NEW LEAF: Posts $2.7 Million Net Loss for March 31 Quarter NORD RESOURCES: Posts $1 Million Net Income for March 31 Quarter NORTEL NETWORKS: Employment Pact With Head Strategist Approved NORTEL NETWORKS: Proposes to Expand Hitachi IP Agreement NORTEL NETWORKS: Seeks Canada Nod for Ericsson Share Purchase NORTEL NETWORKS: Seeks Canada Nod for Ogilvy to Release Escrow NUTRA PHARMA: Posts $300,782 Net Loss for Q1 2010 OCEAN PARK: Section 341(a) Meeting Scheduled for June 8 OK ETON: Case Summary & 10 Largest Unsecured Creditors OTTER TAIL: Posts $2.3 Million Net Loss in Q1 2010 PACIFIC FUEL: Files for Chapter 7 Liquidation PARADISE ESTATES: Case Summary & 4 Largest Unsecured Creditors PEABODY ENERGY: Fitch Affirms Issuer Default Rating at 'BB+' PERRY YOUNG: Case Summary & 8 Largest Unsecured Creditors PHEASANT RUN: Unsecureds to Recover Claims in 4.5 Years PRINCETON OFFICE: Plan Confirmation Order Stayed R. ESMERIAN: Facing Involuntary Chapter 7 Petition RADIAN GROUP: S&P Raises Counterparty Credit Rating to 'CCC+' RADIENT PHARMACEUTICALS: Posts $2.5 Mil. Net Loss for March 31 Qtr RENO-SPARKS INDIAN: Fitch Affirms 'BB' Issuer Default Rating RIVER ROCK: Taps Marcus & Millichap to Handle Bankruptcy Sale ROBERT CORRIGAN: Case Summary & 20 Largest Unsecured Creditors SAGITTARIUS RESTAURANT: Moody's Lifts Corp. Family Rating to Caa1 SAGITTARIUS RESTAURANTS: S&P Downgrades Rating to 'SD' SPANSION INC: Stay Denied on Stock Distribution SPECTRUM BRANDS: S&P Raises Corporate Credit Rating to 'B' STERLING FIN'L: Discloses Deal With Warburg Pincus on Investment STRAFFORD COUNTY: Moody's Affirms 'Ba2' Rating on Parity Debt SUNSTATE EQUIPMENT: Loan Amendment Won't Affect Moody's Rating TELIPHONE CORP: Posts $397,397 Net Loss in Q2 Ended March 31 TELKONET INC: Posts $710,979 Net Loss for March 31 Quarter TELTRONICS INC: Posts $367,000 Net Loss for March 31 Quarter TEXAS RANGERS: Files for Bankruptcy to Sell Baseball Team TEXAS RANGERS: Case Summary & 30 Largest Unsecured Creditors TOUSA INC: Expands Ernst & Young Work TOUSA INC: Files 36 Additional Track IV Adversary Proceedings TOUSA INC: Lenders Stipulate on Allocation for Professional Fees TRANSUNION CORP: S&P Assigns Corporate Credit Rating at 'B+' TRIBUNE CO: Broadcasting Unit Names Kersting as President TRIBUNE CO: Examiner Hires LECG as Financial Advisor TRIBUNE CO: Names S. Compton as President for Programming TRISZA RAY: Case Summary & 20 Largest Unsecured Creditors US AIRWAYS: Pursues Codeshare With Brazil's TAM Airlines US AIRWAYS: Says Govt. Intervention Adding Industry Woes US AIRWAYS: To Appeal DOT Rejection of Slot Transaction VHGI HOLDINGS: Posts $508,060 Net Loss in Q1 2010 VISINET INC: State to Pay Foster Care Providers & Subcontractors VISTEON CORP: Shareholders to Submit Competing Plan Proposal VISTEON CORP: Cash Collateral Use Authorized Until June 18 VISTEON CORP: Goldman Sachs Discloses 3.90% Equity Stake VISTEON CORP: Reaches Stipulation on UK Pension Claim Withdrawal WENTWORTH ENERGY: Posts $372,078 Net Loss for March 31 Quarter WEST FELICIANA: Can Sell Mill Assets to Amzak Capital for $9MM WHITEHALL JEWELERS: Can Access Term Lenders' Cash Until June 30 XERIUM TECHNOLOGIES: Completes Balance Sheet Restructuring ZENITH NATIONAL: Fairfax Deal Cues Fitch to Retain Negative Watch * Upcoming Meetings, Conferences and Seminars ********* ACCESS PHARMACEUTICALS: Has $1.6MM Operating Loss for 1st Quarter ----------------------------------------------------------------- Access Pharmaceuticals Inc. filed its quarterly report on Form 10- Q, showing an operating loss of $1,643,000 on $102,000 of net revenues for the three months ended March 31, 2010, compared with an operating loss of $1,959,000 on $41,000 of net revenues for the same period a year earlier. The Company recorded a net income of $1,089,000 during the first quarter of 2010 because of a $2,877,000 "gain on charge in fair value of derivative." The Company's balance sheet revealed $5,195,000 in total assets and $25,524,000 in total liabilities, for a stockholder's deficit of $20,329,000. Accumulated deficit has reached $241,160,000. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6329 About Access Pharmaceuticals Access Pharmaceuticals, Inc., is an emerging biopharmaceutical company focused on developing a range of pharmaceutical products primarily based upon the Company's nanopolymer chemistry technologies and other drug delivery technologies. The Company currently has one approved product, one product candidate at Phase 3 of clinical development, three product candidates in Phase 2 of clinical development and other product candidates in pre-clinical development. At December 31, 2009, the Company's balance sheet showed $1,583,000 in total assets and $28,572,000 in total liabilities for $26,989,000 in stockholders' deficit. Whitely Penn LP of Dallas, Texas, expressed substantial doubt against Access Pharmaceuticals' ability as a going concern. The firm reported that the Company has had recurring losses from operations, negative cash flows from operating activities and has an accumulated deficit. AFFINION GROUP: Loyalty Business Deal Won't Affect Moody's Rating ----------------------------------------------------------------- Moody's Investors Service stated that it does not expect to take any immediate rating action following Affinion Group Holdings, Inc.'s announcement that it signed an agreement to purchase a North American loyalty business and that it filed for an initial public offering of its common stock. The last rating action on Affinion was on March 25, 2010, when Moody's assigned a Ba2 rating to a proposed $1 billion secured credit facility, lowered the rating on the senior unsecured notes to B3 from B2, and affirmed the B2 Corporate Family Rating and SGL-1 speculative grade liquidity rating. Affinion is a leading provider of marketing services and loyalty programs to many leading firms globally. The company provides credit monitoring and identity-theft resolution, accidental death and dismemberment insurance, discount travel services, loyalty programs, various checking account and credit card enhancement services. Apollo Management V, L.P., owns 97% of Affinion's common stock. AIMS WORLDWIDE: Posts $878,577 Net Loss in Q1 2010 -------------------------------------------------- AIMS Worldwide, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $878,577 on $1,400,512 of revenue for the three months ended March 31, 2010, compared with a net loss of $565,131 on $941,489 of revenue for the same period of 2009. The Company's balance sheet at March 31, 2010, showed $3,761,959 in total assets, $8,684,675 of liabilities, and ($250,970) of minority interest, for a stockholders' deficit of $4,671,746. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?631e Based in Fairfax, Virginia, AIMS Worldwide Inc. (OTC BB: AMWW) -- http://www.aimsworldwide.com/-- is a vertically integrated marketing communications consultancy providing organizations with its AIMSolutions branded focused marketing solutions. As reported in the Troubled Company Reporter on April 21, 2010, Turner, Jones & Associates, PLLC, in Vienna, Va., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant operating losses since its inception and has a net working capital deficiency at December 31, 2009. AMERICAN HOSPITALITY: Section 341(a) Meeting Set for June 10 ------------------------------------------------------------ The U.S. Trustee for Region 2 will convene a meeting of American Hospitality Group, LLC's creditors on June 10, 2010, at 2:00 p.m. The meeting will be held at Office of the U.S. Trustee, Olympic Towers, 300 Pearl Street, 4th Floor, Buffalo, NY 14202. This is the first meeting of creditors required under Section 341(a) of the U.S. 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. Grand Island, New York-based American Hospitality Group, LLC, dba Grand Island Holiday Inn, filed for Chapter 11 bankruptcy protection on May 6, 2010 (Bankr. W.D.N.Y. Case No. 10-11887). Arthur G. Baumeister Jr., Esq., at Amigone, Sanchez, et al., assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000 as of the Petition Date. AMERICAN INSULOCK: Chapter 11 Petition Filed --------------------------------------------- BankruptcyData.com reports that American Insulock filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 10-15646). The Company is represented by J. Kent MacKinlay of Warnock, MacKinlay & Carman. The U.S. Trustee has scheduled a June 22 meeting of creditors under Section 341 of the Bankruptcy Code. American Insulock designs, develops and markets a sustainable, eco-friendly and energy efficient block for commercial and residential construction. AMERICAN NATURAL: Posts $645,398 Net Loss for March 31 Quarter -------------------------------------------------------------- American Natural Energy Corporation filed its quarterly report on Form 10-Q, showing a net loss of $645,398 on $904,592 of total revenues for the three months ended March 31, 2010, compared with a net loss of $469,918 on $81,326 of total revenues during the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $18.2 million in total assets and $9.5 million in total liabilities, for a $8.7 million total stockholders' equity. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?632a American Natural Energy Corporation (TSX Venture: ANR.U) is a Tulsa, Oklahoma-based independent exploration and production company with operations in St. Charles Parish, Louisiana. * * * MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has substantial cash used for operating activities during 2009, has a working capital deficiency and an accumulated deficit at December 31, 2009. AMH HOLDINGS: S&P Raises Corporate Credit Rating to 'B-' -------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit ratings on Cuyahoga Falls, Ohio-based AMH Holdings LLC and its operating subsidiary, Associated Materials LLC, to 'B-' from 'CCC+'. At the same time, S&P raised the issue-level rating on AMI's senior secured second-lien notes due 2016 to 'B' (one notch above the corporate credit rating) from 'CCC'. The recovery rating was revised to '2', reflecting the expectation for substantial (70% to 90%) recovery for lenders in the event of payment default, from '5'. Also, S&P raised the issue-level rating on AMH's senior discount notes due 2014 to 'CCC' from 'CCC-'. The recovery rating remains '6', reflecting the expectation for negligible (0% to 10%) recovery for lenders in the event of a payment default. The rating outlook is stable. All ratings were removed from CreditWatch, where they were placed with positive implications on April 16, 2010. AMH is a holding company with no direct operations and depends on cash flow from AMI to meet its debt obligations. Standard & Poor's Ratings Services views AMH and AMI as a consolidated enterprise. AMI is a leading, vertically integrated manufacturer and North American distributor of exterior residential building products. "The ratings upgrade follows better than previously anticipated improvement in AMI's operating conditions as a result of a gradual recovery in its residential end markets," said Standard & Poor's credit analyst Tobias Crabtree. As a result, S&P expects that the company's credit measures are likely to improve modestly over the next several quarters to levels that S&P would consider more in line with the 'B-' corporate credit rating. Specifically, leverage and interest coverage is likely to be maintained below 6x and above 1.5x, respectively, over the next several quarters. S&P expects end-market demand for AMI's siding and window products to modestly improve, albeit from depressed levels, in 2010 because of S&P's expectations for a modest boost in repair and remodeling spending from 2009's depressed level. While S&P remain cautious regarding a recovery in residential end markets, S&P thinks the company will likely maintain credit measures at a level S&P would consider to be in line with the 'B-' rating. Specifically, leverage and interest coverage is likely to be maintained below 6x and above 1.5x, respectively, over the next several quarters. S&P could take a positive rating action if operating conditions improve more than expected due to a more robust recovery in residential construction resulting in sustained positive free cash flow generation and improved credit metrics. Specifically, if revenues were to increase 20% from 2009's level and EBITDA margins exceed 12%, then leverage and interest coverage would likely approach 5x and 2x, respectively, a level S&P consider more in line with a higher rating. S&P could take a negative rating action if operating conditions do not materially improve, which could cause the company to rely on its asset-based revolving credit facility to fund operating losses and possibly lead to reduced liquidity. Specifically, this could occur if EBITDA were to decline to a level insufficient to service cash interest expense of approximately $70 million and capital expenditures of between $10 million and $15 million. ANPATH GROUP: Files for Chapter 11 With Prepack Plan ---------------------------------------------------- Anpath Group Inc. filed for Chapter 11 with a plan arranged with creditors prepetition. According to Bloomberg News, under the Plan, secured and unsecured creditors would take ownership of the company. Secured lenders owed $2.4 million are to have 61% of the new stock. Holders of unsecured subordinated notes owed $1.7 million are slated for 34% of the equity. Existing shareholders are to retain 5% of the equity. Unsecured creditors would recover 50% of their claims. About Anpath Group Based in Mooresville, N.C., Anpath Group, Inc. (OTC BB: ANPG) -- http://www.anpathgroup.com/-- through its wholly-owned subsidiary EnviroSystems, Inc., provides infection control products on an international basis through both direct sales and channels of distribution. ESI products are currently sold to transportation, military and industrial/institutional markets. ESI products are manufactured utilizing chemical-emulsion technology, designed to make the products effective against a broad spectrum of harmful organisms while safe to people, equipment and habitat. Anpath Group filed for Chapter 11 on May 20, 2010 (Bankr. D. Del. Case No. 10-11652). Mark E. Felger, Esq., at Cozen O'Connor, represents the Debtor in its Chapter 11 effort. The petition said that assets totaled $1,548,646 and debts totaled $3,536,825 as of the filing date. B-VVI LLC: Section 341(a) Meeting Scheduled for June 17 ------------------------------------------------------- The U.S. Trustee for Region 17 will convene a meeting of B-VV1, LLC's creditors on June 17, 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 U.S. 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. Las Vegas, Nevada-based B-VV1, LLC, along with its affiliates, filed for Chapter 11 bankruptcy protection on May 5, 2010 (Bankr. D. Nev. Case No. 10-18284). Georganne W. Bradley, Esq., at Kaempfer Crowell et al., assists the Company in its restructuring effort. According to the schedules, the Company says that assets total $33,001,500 while debts total $12,968,000. BEAR STEARNS: Cioffi Asks Court to Release Collateral ----------------------------------------------------- Ralph Cioffi asks the United States District Court for the Eastern District of New York to order the release of collateral pledged as security for his appearance bond. Since Mr. Cioffi was acquitted, he asserts that there is no further need for an appearance bond and asks that these properties be released: * premises located at 200 Oxford Drive, Tenafly, NJ; * premises located at 1075 Nelson's Walk, Naples, FL; * premises located at 75 Black Cherry Lane, Ludlow, Vermont; and * an IRA account in his name. As previously reported, jurors acquitted Mr. Cioffi and Matthew Tannin from all counts in the securities fraud case filed by the U.S. federal government. The jurors found that there was no evidence beyond a reasonable doubt that Messrs. Cioffi and Tannin had criminal intent and conspired to mislead their investors. About Bear Stearns New York City-based The Bear Stearns Companies Inc. (NYSE: BSC) -- http://www.bearstearns.com/-- was a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The investment bank collapsed in 2008 and was sold in a distressed sale to JPMorgan Chase in a transaction backed by the U.S. government. Grand Cayman, Cayman Islands-based Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage Master Fund Ltd. and Bear Stearns High-Grade Structured Credit Strategies Master Fund Ltd. were open-ended investment companies, which sought high income and capital appreciation relative to the London Interbank Offered Rate, and designed for long-term investors. On July 30, 2007, the Funds filed winding up petitions under the Companies Law of the Cayman Islands. Simon Lovell Clayton Whicker and Kristen Beighton at KPMG were appointed joint liquidators. The joint liquidators filed for Chapter 15 petitions before the U.S. Bankruptcy Court for the Southern District of New York the next day. On August 30, 2007, the Honorable Burton R. Lifland denied the Funds protection under Chapter 15 of the Bankruptcy Code. BILLY SCHWYHART: Judge Barry Dismisses Chapter 11 Case ------------------------------------------------------ Worth Sparkman at Arkansas Business reports that the Hon. Ben Barry of the U.S. Bankruptcy Court in Arkansas dismissed the Chapter 11 case of Bill Schwyhart, saying the Court found no reasonable likelihood of reorganization and there is no evidence that the Arkansas-based property developer will receive any funding to enable it to confirm a Chapter 11 plan. The ruling, according to the report, will allow Pinnacle Point Properties to proceed with a foreclosure action filed in Benton County Circuit in 2009. BLACK RAVEN: Swings to $99,000 Net Loss in Q1 2010 -------------------------------------------------- Black Raven Energy, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $99,000 on $143,000 of revenue for the three months ended March 31, 2010, compared with net income of $23.7 million on $138,000 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $12,646,000 in assets and $18,938,000 of liabilities, for a stockholders' deficit of $6,292,000. The Company continues to experience net losses from its operations, reporting a net loss before reorganization items of $1,164,000 for the three months ended March 31, 2010. "Cash and cash equivalents on hand and internally generated cash flows will not be sufficient to execute the Company's business plan. Future bank financings, asset sales, or other equity or debt financings will be required to fund the Company's debt service, working capital requirements, planned drilling, potential acquisitions and other capital expenditures." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6323 About Black Raven Denver, Colo.-based Black Raven Energy, Inc., formerly known as PRB Energy, Inc., operates as an independent energy company engaged in the acquisition, exploitation, development and production of natural gas and oil in the Rocky Mountain Region of the United States. On March 5, 2008, PRB Energy, Inc. and its subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Colorado. On January 16, 2009, the Bankruptcy Court entered an order confirming PRB Energy reorganization plan. The Plan became effective February 2, 2009. * * * As reported in the Troubled Company Reporter on April 14, 2010, Deloitte & Touche LLP, in Denver, 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 and stockholders' deficit. BROWN PUBLISHING: Newspapers Up for Auction on June 28 ------------------------------------------------------ The Brown Publishing Company and its units have sought approval from the Bankruptcy Court to conduct an auction where Brown Media Corporation, a company formed by insiders, will be the stalking horse bidder. According to Bloomberg News, under procedures emerging from a hearing last week, Brown Publishing will hold an auction on June 28 to learn whether the bid from insiders is the best offer for the business. Other bids are due June 25. The hearing for approval of the sale will take place June 29. Dolan Media Co., publisher of the Long Island Business News, filed papers saying it's another potential bidder, Bloomberg relates. The Debtors have entered into an Asset Purchase Agreement dated May 4, 2010, with Brown Media, which provides for the sale of the assets, subject to any higher and better offers that might be submitted for the sale of the assets to the party or parties that submit the highest and best bid. Under the APA, Brown Media will purchase the assets at $15,300,000. The buying group includes Roy Brown, the president and CEO. In the event that a better offer is made to the Debtors' assets and Brown Media isn't chosen as the purchaser, the Debtors will pay Brown Media a break-up fee of $800,000. The parties have agreed to have a closing date of not later than July 31, 2010. About Brown Publishing Headquartered in Cincinnati, Ohio, The Brown Publishing Company owns business publications in Ohio, Utah, Texas, South Carolina, New York, and Iowa. Brown publishes 15 daily, 32 weekly, 11 business and 41 free publications. There are also 51 websites. Seventy-eight of the publications are in Ohio. Brown publishes Dan's Papers, the weekly newspaper with the largest circulation in the area of eastern Long Island, New York, known as the Hamptons. Brown also publishes the Montauk Pioneer, which it calls the official newspaper of Montauk, New York. The Company filed for Chapter 11 bankruptcy protection on April 30, 2010 (Bankr. E.D.N.Y. Case No. 10-73295). Edward M. Fox, Esq., at K&L Gates LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. BRUNSWICK CORPORATION: Moody's Gives Stable Outlook; Keeps Ratings ------------------------------------------------------------------ Moody's Investors Service revised Brunswick Corporation's rating outlook to stable from negative due to Moody's expectation that its credit risk profile will not deteriorate further and may in fact improve over the near to mid-term. At the same time, Moody's upgraded the speculative grade liquidity rating to SGL 1 and affirmed all other ratings including the B2 CFR and PDR, Ba3 secured notes and Caa1 unsecured notes. "We believe Brunswick's strong liquidity profile, improved cost structure, enhanced health of its dealership network and increased wholesale shipments should enable it to maintain its current credit profile, even if retail demand in 2010 declines more than the 10% the company is currently planning for and despite the burgeoning sovereign debt crisis," said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. "If retail demand were to approximate the company's planning assumption rather than the 20% decline experienced in the first quarter and worldwide financial markets stabilize, Brunswick's credit profile could improve in the near term," Cassidy added. The stable outlook reflects Moody's expectation that retail demand in 2010 will not materially decline beyond its current pace in the near to mid-term despite Moody's expectation of modest discretionary consumer spending and that revenue and operating income will steadily improve. The corresponding enhancement in credit metrics is also incorporated in the stable outlook as is Moody's assumption that Brunswick will make additional cost cutting moves if necessary. The stability of Brunswick's senior executives is also assumed. The upgrade in the speculative grade liquidity rating to SGL 1 from SGL 2 indicates that Moody's believes Brunswick will maintain its strong liquidity profile for at least the next twelve months. Brunswick's liquidity is supported by cash balances of around $550 million, Moody's expectation of positive free cash flow in 2010 even if retail demand falls around 20%, access to over $125 million in credit facilities combined between the $400 million ABL and $100 million Mercury ABL and no near term debt maturities. Brunswick's B2 corporate family ratings reflects the severe and sudden volatility in consumer spending over the last two years and most notably for discretionary marine related products, which has resulted in very weak credit metrics and a significant decrease in revenue and operating income. However, the rating also reflects Moody's expectation that operating results will meaningfully improve in the near to mid-term as Brunswick continues to increase its production to meet the reduced demand levels. A key component of the B2 corporate family rating is Brunswick's strong liquidity profile. Other factors supporting the rating are the generally good operating performance of its dealership network and reduced inventory levels. Having a joint venture agreement with General Electric Capital Corporation for floorplan financing is important to the rating, but longer term risks remain. This rating was upgraded: * Speculative grade liquidity rating to SGL 1 from SGL 2 These ratings were affirmed/assessments revised: * Corporate family rating at B2; * Probability of default rating at B2; * $475 million senior unsecured notes due 2013-2027 at Caa1 (LGD 5, 89% from LGD 5, 87%); * $340 million senior secured notes due 2016 at Ba3 (LGD 2, 23% from LGD 2, 29%); The last rating action was on August 10, 2009, where Moody's rated the secured notes, confirmed all other ratings and kept the ratings outlook negative. Brunswick is headquartered in Lake Forest, Illinois. The company manufactures marine engines, pleasure boats, bowling capital equipment and fitness equipment, and operates retail bowling centers. Sales for the twelve months ended March 2010 approximated $2.9 billion. CALYPTE BIOMEDICAL: Delays Filing of Quarterly Report on Form 10-Q ------------------------------------------------------------------ Calypte Biomedical Corporation said it could not file its quarterly report Form 10-Q for the period ended March 31, 2010, on time with the Securities and Exchange Commission. The Company said that due to its limited financial resources and thin staffing, it is particularly vulnerable to delays in the preparation of its financial statements and periodic reports. Due to staffing issues, among other things, the Company tends to experience delays in obtaining information from its Chinese subsidiaries necessary to complete its financial disclosures included in its periodic reports. Portland, Ore.-based Calypte Biomedical Corporation develops, manufactures, and distributes in vitro diagnostic tests, primarily for the diagnosis of Human Immunodeficiency Virus infection. The Company's balance sheet as of December 31, 2009, showed $5.4 million in assets and $20.6 million of debts, for a stockholders' deficit of $15.1 million. Odenberg, Ullakko, Muranishi & Co. LLP, in San Francisco, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has defaulted on $6.3 million of 8% Convertible Promissory Notes and related Interest Notes and $5.2 million of 7% Promissory Notes, has suffered recurring operating losses and negative cash flows from operations, and management believes that the Company's cash resources will not be sufficient to sustain its operations through 2010 without additional financing. CAPMARK FINANCIAL: Fitch Withdraws 'D' Issuer Default Rating ------------------------------------------------------------ Fitch Ratings has withdrawn its ratings of Capmark Financial Group Inc. and its subsidiaries. In addition, Fitch has withdrawn its ratings on Capmark Bank. Fitch will no longer provide ratings or analytical coverage on Capmark or its subsidiaries. These ratings have been withdrawn by Fitch: Capmark Financial Group Inc. -- Long-term IDR 'D'; -- Short-term IDR 'D'; -- Senior unsecured debt 'C/RR5' -- Term secured bank facility 'CC/RR3'; -- Revolving credit facility 'C/RR5'; -- Term Bank facility 'C/RR5'. Capmark Bank -- Long-term IDR 'CC'; -- Shorter Term IDR 'C'; -- Individual 'E'; -- Long-term Deposits 'CCC'; -- Short-term Deposits 'C'; -- Support '5'. Capmark Commercial Funding Asia K.K. (Japan) -- Long-term IDR 'C'; -- Short-term IDR 'C'. CARROLE COLLINS: Case Summary & 18 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Carrole C. Collins 321 S. Clark Lane Elizabeth, IL 61028 Bankruptcy Case No.: 10-72658 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Northern District of Illinois (Rockford) Judge: Manuel Barbosa Debtor's Counsel: Abraham Brustein, Esq. Dimonte & Lizak, LLC 216 W. Higgins Road Park Ridge, IL 60068 Tel: (847) 698-9600 Ext: 221 Fax: (847) 698-9623 E-mail: abrustein@dimonteandlizak.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 A copy of the Debtor's list of 18 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ilnb10-72658.pdf The petition was signed by the Debtor. CENTAUR LLC: Plan Contemplates Restructuring of Credit Deals ------------------------------------------------------------ Centaur, LLC, filed with the U.S. Bankruptcy Court for the District of Delaware an amended Disclosure Statement explaining the proposed Plan of Reorganization. According to the Disclosure Statement, the Plan contemplates the formation of a NewCo as a Delaware or Indiana limited liability company. The Plan will restructure the obligations under the prepetition first lien and second lien credit agreement. Under the Plan, the obligations to holders of other secured claims will be reinstated. The Plan provides that holders of unsecured claims (other than convenience claims) against Valley View Downs, LP will be cancelled. Holders of unsecured claims equal to or less than $10,000, or who elect to reduce the allowed amount of their claims, in their entirety, to $10,000, will be paid 100% of their claims in cash; and the Plan provides that all other prepetition unsecured claims will be cancelled and will not receive a recovery under the Plan. Treatment of Claims Class Estimated Recovery ----- ------------------ 1 - Priority Non-Tax Claims 100% 2 - First Lien Claims 79.6% 3 - Second Lien Claim 1.4%, if Plan is accepted 4 - Other Secured Claims 100% 5 - Valley View Downs Unsecured Claims 1.4% 6 - General Unsecured Claims None 7 - Convenience Claims 100% 8 - Intercompany Claims will be cancelled and all holders of Intercompany Claims will receive no distribution on account of their claims. 9 - Borrower Equity Interests None 10 - Subsidiary Equity Interests 100% A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/CentaurLLC_AmendedDS.pdf About Centaur LLC Indianapolis, Indiana-based, Centaur, LLC, aka Centaur Indiana, LLC -- http://www.centaurgaming.net/-- is an company involved in the development and operation of entertainment venues focused on horse racing and gaming. The Company filed for Chapter 11 bankruptcy protection on March 6, 2010 (Bankr. D. Delaware Case No. 10-10799). Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $500,000,001 to $1,000,000,000 as of the Petition Date. CHARLES FORD: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Joint Debtors: Charles R. Ford fdba C&S Transport dba NGS Inc. Wildwood Inn Shirley A. Ford 501 Breezewood Road Breezewood, PA 15533-8936 Bankruptcy Case No.: 10-70600 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Western District of Pennsylvania (Johnstown) Debtor's Counsel: James R. Walsh, Esq. Spence Custer Saylor Wolfe & Rose 400 U.S. Bank Building P.O. Box 280 Johnstown, PA 15907 Tel: (814) 536-0735 Fax: (814) 539-1423 E-mail: jwalsh@spencecuster.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Joint Debtors say that assets total $817,977 while debts total $2,456,627. A copy of the Joint Debtors' list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/pawb10-70600.pdf The petition was signed by the Joint Debtors. CHEMTURA CORP: In Talks With Unsecureds & Equity Holders on Plan ---------------------------------------------------------------- Chemtura Corporation is in active and ongoing discussions with its Official Unsecured Creditors Committee and Official Equity Committee in an effort to reach a consensual Chapter 11 plan of reorganization. Additionally, today Chemtura said it is finalizing an agreement with an existing ad hoc committee of bondholders on confidentiality terms that will allow Chemtura's largest bondholders to engage in direct negotiations with the Company regarding the terms of a Chapter 11 plan. Chemtura is hopeful that it will successfully bring together the interests of all its stakeholders in a consensual plan of reorganization, which will permit an exit from Chapter 11 in the near term, thereby maximizing value for all of them. As currently contemplated, the plan of reorganization will provide for emergence of Chemtura from Chapter 11 and continuation of all worldwide operations of Chemtura and its subsidiaries. The plan as currently contemplated will specify treatment for funded debt obligations, trade claims and litigation claims, including providing treatment for diacetyl litigation claims in an agreed or judicially estimated amount. Chemtura also expects that the plan will provide for payment of creditors in the form of cash or common stock in a reorganized, publicly traded company. While there can be no guarantee regarding the value or type of recovery available to any class of creditors or interest holders under the plan, it is anticipated that creditors will be paid at or near the full value of their claims and there may well be recovery available for holders of Chemtura's common stock. Chemtura continues to discuss the specifics of the plan with its stakeholders, including the valuation of reorganized Chemtura, the specific form of consideration that will be available to various types of constituencies and the funding of such consideration. Chemtura's Chief Executive Officer, Craig Rogerson, commented, "Our intent is to emerge from Chapter 11 as quickly and efficiently as possible. We believe that filing a plan of reorganization with the support of all of our major constituencies is the best way to accomplish this goal. Chemtura intends to file a plan of reorganization by June 17, and accordingly intends to file a motion to extend its exclusive rights to file a Chapter 11 plan, and solicit votes thereon, in order to facilitate the Chapter 11 process." For Chemtura to emerge from its Chapter 11 proceedings, a plan of reorganization will have to be confirmed by the bankruptcy court after solicitation of votes thereon. The plan of reorganization is expected to include closing conditions that will need to be satisfied before emergence. About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHINA IVY: Posts $352,811 Net Loss in Q1 2010 --------------------------------------------- China Ivy School, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $352,811 on $1,601,365 of revenue for the three months ended March 31, 2010, compared with net income of $43,820 on $1,487,382 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $15,522,072 in assets, $13,830,992 of liabilities, and $1,691,080 of stockholders' equity. Michael T. Studer CPA P.C., in Freeport, N.Y., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. As of March 31, 2010, and December 31, 2009, the Company had cash of $2,264,332 and $46,187, respectively, and working capital deficit of $9,249,145 and $11,038,871, respectively. The Company had an accumulated deficit of $5,468,433 as of March 31, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6322 Based in Jiangsu Province, P.R. China, China Ivy School, Inc. was incorporated in the State of Nevada. The Company operates an educational facility under the name "Blue Tassel School" which provides a comprehensive curriculum required by the government of the People's Republic of China, supplemented by a broad range of elective courses which may be chosen from by the school's students. To the present date, the Company has only operated within the People's Republic of China. CHINA TRACTOR: Posts $2.8 Million Net Loss in Q1 2010 ----------------------------------------------------- China Tractor Holdings, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $2,773,545 for the three months ended March 31, 2010, compared with net income of $63,550 for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $14,947,580 in assets, $4,698,812 of liabilities, and $10,248,768 of stockholders' equity. On March 15, 2010, the Company signed a stock transfer agreement to transfer all shares owned by the Company in Chang Tuo to SOASACC, and the agreement was approved by Changchun government on April 19, 2010. Chang Tuo was reported as discontinued operation as the Company lost its control before the end of 2009. After the completion of the transaction, the Company will have no substantial business operations until it enters a new industry through merger or acquires other operational entities. As a direct result, the Company has experienced significant operating losses for the three months ended March 31, 2010. The discontinued operation and the ensuing operating losses raise substantial doubt as to the Company's ability to continue as a going concern. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6334 ChangChun City, P.R. China-based China Tractor Holding, Inc. currently does not have any operations. On December 1, 2009, the Company entered into a letter of intent to transfer all shares owned by the Company in Chang Tuo Agricultural Machinery Equipment Group Co., Ltd. to State-owned Assets Supervision and Administration Commission of Changchun ("SOASACC"). Goldman Parks Kurland Mohidin LLP, in Encino Calif., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company has incurred a loss of $3,702,673, including loss from continuing operations of $488,640. CHINA VOICE: Posts $496,541 Net Loss in Q3 Ended March 31 --------------------------------------------------------- China Voice Holding Corp. filed its quarterly report on Form 10-Q, showing a net loss before preferred dividend of $496,541 on $1,188,880 of revenue for the three months ended March 31, 2010, compared with net income before preferred dividend of $2,478,490 on $302,666 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $17,391,484 in assets, $7,147,809 of liabilities, and $10,243,675 of stockholders' equity. As reported in the Troubled Company Reporter on November 6, 2009, Jimmy C.H. Cheung & Co, in Hong Kong, expressed substantial doubt about China Voice Holding Corp. and subsidiaries' ability to continue as a going concern after auditing the Company's consolidated financial statements for the fiscal years ended June 30, 2009, and 2008. The auditors noted that of the Company's net losses and accumulated deficits during the past two fiscal years. During the nine months ended March 31, 2010 and 2009, the Company had significant operating losses which raise substantial doubt about the Company's ability to continue as a going concern. During the nine months ended March 31, 2010, and 2009, the Company has used cash flow in operations of $923,294 and $2,260,216. Accumulated deficit amounted to $32,779,556 and $29,576,504 as of March 31, 2010, and June 30, 2009, respectively. A full-text copy of the quarterly report is available at no charge at http://researcharchives.com/t/s?6324 About China Voice Based in Boca Raton, Fla., China Voice Holding Corp. -- http://www.chvc.com/-- is a U.S. publicly-traded holding company with a portfolio of next-generation communications products and services doing business in the People's Republic of China, where the Company has obtained full legal status as a licensed Chinese telecommunications company. Through its subsidiaries, the Company provides Voice over Internet Protocol telephone services, office automation, wireless broadband, unified messaging, video conferencing, mobility services and other advanced voice and data services. CHVC's focus is on providing its innovative and patented voice and data solutions to government agencies and large enterprises in China. CHINA YOUTH MEDIA: Posts $1.06-Mil. Net Loss in Q1 2010 ------------------------------------------------------- China Youth Media, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $1,062,264 on $37,430 of revenue for the three months ended March 31, 2010, compared with a net loss of $715,347 on no revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $4,740,149 in assets, $3,856,643 of liabilities, and $883,506 of stockholders' equity. Tarvaran Askelson & Company, LLP, in Laguna Niguel, Calif., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company has incurred significant losses. "At March 31, 2010, the Company had an accumulated deficit of $21.2 million and a working capital deficit of $1.1 million. During the three months ended March 31, 2010, the Company incurred a loss of approximately $1.06 million. During the three months ended March 31, 2010, the Company primarily relied upon financing activities to fund its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6338 Headquartered in Marina Del Rey, Calif., China Youth Media, Inc. (OTC BB: CHYU) -- http://www.chinayouthmedia.com/-- delivers advertising and content in the People's Republic of China. CHRYSLER LLC: 50 Former Dealers Drop Arbitration Cases ------------------------------------------------------ Fifty former dealers of Chrysler Group LLC whose franchises were terminated dropped efforts to appeal their action in arbitration, Dow Jones reported. About 250 of the 418 dealers who had planned to take their cases to an arbitrator now remain. Larry Weathers III, one of the affected dealers told Dow Jones that he decided to give up on pursuing arbitration after he concluded it would be a fruitless effort. "There is no legitimate effort by Chrysler to fix the damage done by the stroke of a pen to dealers who have supported them for years," Dow Jones quoted Mr. Weathers as saying. Mr. Weathers said the auto maker requires dealers to sign confidentiality agreements before it shares information in the arbitration cases, which he disagrees with. He said the information can then never be used again. A Chrysler spokeswoman, however, said the auto maker required confidentiality agreements because there is confidential material being discussed in the hearings and that it has responsibility to protect its interests, Dow Jones reported. Earlier, Chrysler Group had won three out of the five arbitration cases in which decisions had been rendered. An arbitrator sided with Chrysler Group in the Florida dealership cases of Bob Taylor Jeep and Venice Dodge, and a Texas dealership case of Manuel Dodge. A Cincinnati dealer lost his hearing while another Deland- based dealership owner won his case. Chrysler Group terminated 789 dealers in June 2009 as part of its restructuring, a move that drew flak not only from the affected dealers but from lawmakers as well. Congress eventually passed a law late last year giving the affected dealers of Chrysler Group and another bankrupt auto maker, General Motors Corp., a chance to challenge or reconsider decisions to revoke their franchises. The law established an arbitration process to determine whether dealerships ought to be reinstated. About Chrysler Group Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: Marchionne Says New Chrysler May Go Public in 2011 ---------------------------------------------------------------- Sergio Marchionne, chief executive of Chrysler Group, said the auto maker may launch an initial public offering next year, according to a report by Reuters. Mr. Marchionne said he believes there will be enough investor demand for both Chrysler Group and General Motors Co. to sell shares to the public in the next 12 to 18 months and that he would not mind if GM went first, Reuters reported. "I think there is enough appetite, and I am always respectful of the bigger guy," Mr. Marchionne said, referring to GM which is led by Chief Executive Ed Whitacre. "I spoke to Ed a while back. He wants to go public, let him go. We'll come in second," Reuters quoted him as saying. Chrysler Group and GM are looking to eliminate or reduce majority ownership positions of large entities. In Chrysler Group's case, its largest owner is the United Auto Workers health care trust, according to a report by The Globe and Mail. Both auto makers were bailed out by the U.S. and Canadian governments last year after filing for bankruptcy protection. About Chrysler Group Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: New Chrysler Repositions Agency Responsibilities -------------------------------------------------------------- To continue to effectively communicate the direction of the Chrysler, Dodge, Jeep(R) and Ram Truck brands, the company said in a statement that it has repositioned some agency responsibilities. These changes enable each of the agencies to be more responsive to the individual brand needs and allow Chrysler Group to continue its renewed focus, the statement said. As multicultural segments become more important for Chrysler Group's success in the U.S. market, GlobalHue will lead all multicultural strategies for Chrysler, specifically for Dodge, Ram Truck and Jeep brands. Due to this increased responsibility for GlobalHue, Wieden+Kennedy will develop the creative for the marketing and advertising for the launch of the all-new 2011 Jeep Grand Cherokee. GlobalHue will remain the Lead Agency for the Jeep Brand. Each of the company's four agencies will continue to work as the lead agency for each of their brands. About Chrysler Group Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: New Chrysler to Cooperate With NHTSA Investigation ---------------------------------------------------------------- NHTSA has notified Chrysler Group LLC that it is investigating a potential condition with 2007 model year Dodge Caliber accelerator pedals. Some customers have reported sticking accelerator pedals. Chrysler Group is not aware of any accidents, injuries, or property damage related to these reports. The company's initial examination of customer complaints finds they are limited to a small group of vehicles built during a five week window in March and April of 2006. It appears to be a supplier manufacturing concern, which is mechanical in nature and not a design or electronic issue. Additionally, the Dodge Caliber is equipped with a brake override system. If a disagreement occurs between the throttle and the brake, the engine controller will reduce power, allowing the operator to stop the car. Chrysler Group has been using brake override technology in its vehicles since 2003. The company will cooperate fully with NHTSA. Customers who own a 2007 model year Dodge Caliber built during the time of March thru April of 2006 may visit their local Dodge dealer for a free accelerator pedal inspection. Customers who cannot identify the build date of their vehicle, or are otherwise concerned about this issue may receive assistance from their local dealer, or contact Chrysler Customer Care at 1-800-992-1997. The Dodge Caliber has achieved the government's highest safety rating, five star front impact and five star side impact and also is rated good in front impact by the Insurance Institute for Highway Safety (IIHS). Good is the highest rating from IIHS. About Chrysler Group Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: New Chrysler Wary of GM Plan to Reclaim Ally Fin'l ---------------------------------------------------------------- Chrysler Group LLC has raised concerns about reports that General Motors is interested in acquiring back the auto financing business from Ally Financial, The Detroit Free Press. Chrysler Group Chief Executive Sergio Marchionne said the auto maker is wary of being put at a competitive disadvantage with GM when it comes to offering lease and loan deals to consumers, according to the report. Ally Financial, formerly called GMAC Financial Services, is the preferred lender for Chrysler Group after the U.S. government wound down Chrysler Financial, the auto maker's lending arm. The U.S. Treasury owns 56% of Ally Financial after the government injected $17 billion as part of a restructuring that also saw the finance company become a commercial bank. Mr. Marchionne also said that Chrysler Group would need time to find a permanent and stable replacement for providing car loans if it loses access to bank financing it shares with GM, according to a report by Reuters. The chief executive said the auto maker would need a stable option for auto financing if GM buys out or becomes formally affiliated with Ally Financial's financing business. "Once they tell me that GMAC is going back into [GM], we need to have the time, the space to find an alternative solution to the long-term future of Chrysler," Reuters quoted Mr. Marchionne as saying. About Chrysler Group Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CIENA CAPITAL: Credit Suisse Objects to FCA Settlements ------------------------------------------------------- Bankruptcy Law360 reports that Credit Suisse Securities (USA) LLC is objecting to Ciena Capital LLC's move to settle False Claims Act litigation and disputes with the U.S. Small Business Administration, arguing that the proposed deals could lead to woefully inequitable consequences. Law360 says the proposed settlements provide for broad and unfettered third-party releases to the detriment of all creditors, Credit Suisse said in an objection Friday in U.S. Bankruptcy Court for the Southern. About Ciena Capital Headquartered in New York City, Ciena Capital LLC -- http://www.cienacapital.com/-- offers commercial real estate finance services including loans and long term investment property financing. The Company and 11 affiliates files for Chapter 11 protection on Sept. 30, 2008 (Bankr. S.D. N.Y. Lead Case No. 08- 13783). Peter S. Partee, Esq., and Andrew Kamensky, Esq., at Hunton & Williams LLP, represent the Debtors as counsel. Mark T. Power, Esq., and Jeffrey Zawadzki, Esq., at Hahn & Hessen LLP, represent the Official Committee of Unsecured Creditors as counsel. When the Debtors filed for protection from their creditors, they listed both assets and debts between $100 million and $500 million. * * * As reported in the Troubled Company Reporter on April 5, 2010, Bankruptcy Law360 reports that Ciena Capital LLC has filed a Chapter 11 reorganization plan that would hand ownership of the company over to its lenders and resolve numerous claims among it, its secured lenders and unsecured creditors, and the federal government. CINCINNATI BELL: Moody's Corrects Rating on Senior Bonds to 'B2' ---------------------------------------------------------------- Moody's Investors Service has corrected a press release on Cincinnati Bell Inc.'s rating. Moody's substituted "B2" for "B1" in the fifth paragraph Downgrades, fifth line "Senior Unsecured Regular Bond/Debenture, Downgraded to B2, LGD4, 61% from Ba3, LGD4, 53%". The revised release is: Moody's Investors Service has downgraded the corporate family rating and probability of default rating of Cincinnati Bell Inc., each to B1 from Ba3, reflecting the higher leverage and significantly reduced free cash flow generation as expected due to its pending acquisition of CyrusOne for $525 million in cash. While Moody's believes that CBB's increasing investments in its technology segment are strategically sound, concerns remain about the high purchase price multiples that data center assets are garnering and future pricing pressure that is likely to ensue as more hosting capacity comes on the market. Moody's also assigned a Ba3 rating to new senior secured credit facilities that will be used to complete the acquisition and refinance existing debt. Moody's notes that CBB intends to raise additional senior unsecured debt in the near future, with the proceeds of any such financing likely to commensurately reduce senior secured debt outstandings. If the company is successful in raising unsecured debt at CBB, then ratings for the senior secured credit facilities could rise. As part of the rating action, Moody's downgraded the company's senior unsecured notes to B2 from Ba3, and its senior subordinated notes and preferred stock, each to B3 from B2, reflecting these securities' junior positions in the capital structure. In addition, Moody's downgraded the ratings of the senior unsecured notes at CBB's Cincinnati Bell Telephone subsidiary, to Ba2 from Ba1. Upon closing of the transactions, ratings for the existing senior secured credit facilities will be withdrawn. The rating actions conclude the review for possible downgrade initiated by Moody's on May 13, 2010, following the CyrusOne acquisition announcement. Moody's has taken these rating actions: Downgrades: Issuer: Cincinnati Bell Inc. -- Probability of Default Rating, Downgraded to B1 from Ba3 -- Corporate Family Rating, Downgraded to B1 from Ba3 -- Senior Secured Regular Bond/Debenture, Downgraded to Ba3 LGD3, 34% from Ba2 LGD3, 36% -- Senior Unsecured Regular Bond/Debenture, Downgraded to B2, LGD4, 61% from Ba3, LGD4, 53% -- Senior Subordinated Regular Bond/Debenture, Downgraded to B3, LGD6, 91% from B2, LGD5, 89% -- Preferred Stock, Downgraded to B3 LGD6, 97% from B2 LGD6, 98% Issuer: Cincinnati Bell Telephone Company -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba2, LGD2, 23% from Ba1, LGD2, 16% Assignments: Issuer: Cincinnati Bell Inc. -- Senior Secured Bank Credit Facility, Assigned Ba3 LGD3, 34% Outlook Actions: Issuer: Cincinnati Bell Inc. -- Outlook, Changed To Stable From Rating Under Review Issuer: Cincinnati Bell Telephone Company -- Outlook, Changed To Stable From Rating Under Review Confirmations: Issuer: Cincinnati Bell Inc. -- Existing Senior Secured Bank Credit Facility, Confirmed at Ba2, LGD3, 36% to be withdrawn Withdrawals: Issuer: Cincinnati Bell Inc. -- Senior Subordinated Regular Bond/Debenture, Withdrawn, previously rated B2, LGD5, 89% The B1 CFR reflects CBB's relatively high leverage for a telecommunications company and poor expected free cash flow generation as the company intends to expand the staged build-out of its data center business. The company has been devoting a greater share of its capital budget over the past three years to grow the data center business, and the acquisition of CyrusOne marks its first significant expansion outside the core Ohio, Kentucky and Indiana service territories since the company retrenched its operations around its historic base over the last decade. Moody's is also concerned that if the company expands its data center footprint internationally, this will increase operating and execution risks. At the same time, Moody's anticipates that downward pressure on the company's revenue will persist due to continuing access line losses in CBB's incumbent wireline territories and intense competition in wireless segment. As such, even though Moody's does not expect the company to resume its share repurchases, nearly all free cash flow generation will be consumed by increased capital expenditures in its wireless and technology solutions segments, in addition to pension contributions over the next two to three years. The ratings benefit from CBB's solid market position as an incumbent residential telecommunications provider and the revenue diversification it derives from its wireless network and business customer base. The stable outlook is based on Moody's expectations CBB will be able to maintain stable EBITDA levels by offsetting access line losses by increasing efficiencies in its incumbent wireline operations and by growing data and broadband revenues in its wireless segment. CBB's SGL-3 short term liquidity rating reflects Moody's view that the company will have adequate liquidity, as the company's forward capital spending and pension plan contributions will materially reduce free cash flow generation. Moody's expects the company to generate modest free cash flow for 2010, but also expects the company to consume net cash in 2011 data center expansion continues. The company's liquidity is bolstered by the amended $210 million revolving credit facility, which will also give the company greater operating flexibility with increased covenant headroom over the next two years. Moody's most recent rating action for CBB was on May 13, 2010, when Moody's placed the ratings of CBB and its subsidiaries on review for possible downgrade. Cincinnati Bell Inc., with headquarters in Cincinnati, Ohio, provides telecommunications products and services to residential and business customers in Ohio, Kentucky and Indiana. CBB generated $1.3 Billion in revenues in 2009. CINCINNATI BELL: S&P Assigns 'BB' Rating on $970 Mil. Notes ----------------------------------------------------------- Standard & Poor's Ratings Services assigned its issue-level and recovery ratings to Cincinnati, Ohio-based Cincinnati Bell Inc.'s proposed $970 million proposed senior secured credit facilities, consisting of a $760 million term loan B due 2017 and a $210 million revolving credit facility due 2014. S&P rated the facilities 'BB' (two notches higher than S&P's 'B+' corporate credit rating on the company) with a recovery rating of '1', indicating S&P's expectations of very high (90% to 100%) recovery for lenders in the event of a payment default. In addition, S&P revised its recovery rating on CBI's senior unsecured debt to '6', indicating its expectation of negligible (0% to 10%) recovery for debtholders in the event of a payment default, from '3'. S&P lowered its issue-level rating on this debt to 'B-' -- two notches below the 'B+' corporate credit rating -- in accordance with its notching criteria for a '6' recovery rating. This rating action is primarily due to the increase in the amount of senior secured indebtedness in CBI's capital structure. At the same time, S&P affirmed its other outstanding ratings on CBI, including the 'B+' corporate credit rating. The rating outlook is negative. The company plans to use proceeds from the new bank facility to refinance existing bank debt and to fund its acquisition of CyrusOne. S&P will withdraw the ratings on the existing bank facility when the transaction closes. "The 'B+' rating reflects CBI's aggressive financial profile, with expectations for limited discretionary cash flow after funding its capital spending for its data center business," said Standard & Poor's credit analyst Naveen Sarma. "The significant competitive pressures facing its core wireline business, which contributes the majority of consolidated revenues and EBITDA, constitutes another credit risk. Also, CBI's wireless operations remain subject to material competition from both national wireless providers and regional competitors, and the company is concentrated in a single market. Tempering factors include CBI's healthy EBITDA margins at its core wireline business, despite ongoing access-line erosion, and growing contributions from its technology solutions business." CIRCUIT CITY: Claim Transfers for April 2010 -------------------------------------------- The Bankruptcy Clerk recorded these claims changing hands in April 2010: Claim Amount Transferor Transferee Number Transferred ---------- ---------- ------ ----------- AR Investments, L P The Seaport Group 7481 $291,630 LLC Hain Capital Group, Scoggin Worldwide 732 1,490,630 LLC Fund, Ltd. Hain Capital Group, Scoggin Worldwide 1446 4,713,340 LLC Fund, Ltd. Hain Capital Group, Scoggin Worldwide 13005 1,112,205 LLC Fund, Ltd. Imagitas Inc. ASM Capital III, 14289 1,149,973 L.P. Sonnet Investments, The Seaport Group 7480 35,129 LLC LLC On May 14, 2010, Scoggin filed a notice of withdrawal of transfer with respect to Claim No. 1446. April Claims Trading Records SecondMarket Inc., which began keeping claims trading records in January 2008, said that April this year proved to be an active month in the claims trading market. The face value of claim transfers totaled a robust $3.65B, surpassing SecondMarket's previously recorded high of $3.3B in December 2009. There were 1,086 claim transfers logged in 62 unique Chapter 11 cases, marking the third consecutive month with over 1,000 transfers. Twelve debtors had claims trade for the first time this month, including commercial aviation holding company, Mesa Air Group, Inc. The 62 unique cases in which claims were transferred represent the highest number of cases traded in the last six months. Based on the amount of claims transferred, Lehman Brothers Holdings Inc. led with $3.19 billion. Based on the number of transactions, Smurfit-Stone Container Corp. led the pack during the month. On April 14, Lehman Brothers Holdings filed its disclosure statement. The document suggests that certain of Lehman's unsecured creditors could recover approximately 15% of their claims. Lehman had 268 of its claims transferred in April amounting to a total face value of $3.19B, the highest monthly total to date. Trump Entertainment Resorts, Inc., had four claims transfer for $273MM following the confirmation of its reorganization plan. Smurfit-Stone Container had 300 of its claims transferred, which marks a decline from March, but still makes it the most transferred case this month. The average claim amount transferred rose for the second consecutive month, reaching $114,131- up from $77,900 in March. Lyondell Chemical Co. entered the top ten in number of claims transferred for the month with 25 transfers. Lyondell's reorganization plan was confirmed on April 23 and the effective date occurred on April 30. A copy of SecondMarket's Claims Trading Monthly newsletter for April is available at http://bankrupt.com/misc/1783.pdf SecondMarket calls itself the largest secondary market for illiquid assets. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. In May 2009, Systemax Inc., a multi-channel retailer of computers, electronics, and industrial products, acquired certain assets, including the name Circuit City, from the Debtors through a Court- approved auction. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). CIRCUIT CITY: Sues Avenues in Leather to Seek $628,000 ------------------------------------------------------ Circuit City Stores Inc. and its units, in their complaint against Avenues in Leather, Inc., seek damages of at least $107,844, and for avoidance of preferential transfers of not less than $520,233. The Debtors and Avenues were parties to a certain letter agreement for the purchase of certain goods produced by Avenues for sale in the Debtors' stores. Pursuant to the parties' written contract, Avenues provided the Debtors a "defective allowance" in lieu of returns of defective products via a quarterly billback in the amount of 0.5% of net purchases. According to Douglas M. Foley, Esq., at McGuireWoods LLP, in Richmond, Virginia, Avenues was required to remit to the Debtors, and the Debtors were entitled to payment for: (a) Quarterly payments as a "defective allowance" in the amount of 0.5% of net purchases. (b) Debits for price protection. (c) Debits for the return of inventory overstock items. Avenues was required to remit payment to the Debtors for any debit balance within 30 days of the Debtors' notice of a debit balance. The Debtors sent Avenues a letter, on August 20, 2008, terminating the Written Contract. Notwithstanding the Termination Letter, the parties continued their commercial relationship in substantially the same terms of the Written Contract -- the Contract -- resulting in and contributing to certain unpaid obligations. The Debtors performed services prepetition and postpetition pursuant to the Written Contract and the Contract, and demanded payment for Unpaid Obligations aggregating $107,844, comprising of Prepetition Receivables of $105,193, and Postpetition Receivables of $2,651. The Debtors sent a demand letter to Avenues for the Unpaid Obligations on June 25, 2009. Moreover, within 90 days before the Petition Date, the Debtors made multiple transfers of interest of their property to or for the benefit of Avenues in an amount not less than $520,233, according to Mr. Foley. The Debtors allege these counts against Avenues in the Complaint: (1) Breach of contract; (2) Turnover of property pursuant to Section 542 of the Bankruptcy Code; (3) Unjust enrichment/quasi contract; and (4) Recovery of preferential transfers pursuant to Sections 547(b) and 550 of the Bankruptcy Code. The Debtors ask the Court to: (1) Enter judgment against Avenues for breach of contract and award the Debtors damages in an amount not less than $107,844, plus costs, fees, expenses, including attorneys' fees, and interest at the higher of the legal rate or the rate set forth in the Contract or in any agreements governing the Unpaid Obligations; or (2) In the alternative, order Avenues to turn over and deliver to the Debtors the Unpaid Obligations in an amount not less than $107,844, plus costs, fees, expenses, including attorneys' fees, and interest at the higher of the legal rate or the rate set forth in the Contract or in any agreements governing the Unpaid Obligations; or (3) In the alternative, enter judgment against Avenues for unjust enrichment and award the Debtors restitution on account of Avenues' unjust enrichment in an amount not less than $107,844, plus costs, fees, expenses, including attorneys' fees, and interest at the higher of the legal rate or the rate set forth in the Contract or in any agreements governing the Unpaid Obligations; and (4) Enter an order pursuant to Section 550 of the Bankruptcy Code for avoidance of a preferential transfer pursuant to Section 547(b) of the Bankruptcy Code in an amount not less than $520,233, plus costs, fees, expenses, including attorneys' fees, and interest at the legal rate. In a separate filing, the Debtors seek leave to file the Written Contract under seal as it contains certain confidential information. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. In May 2009, Systemax Inc., a multi-channel retailer of computers, electronics, and industrial products, acquired certain assets, including the name Circuit City, from the Debtors through a Court- approved auction. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). CIRCUIT CITY: Sues Schimenti to Avoid $814,000 ---------------------------------------------- Circuit City Stores Inc. and its units, in their complaint against Schimenti Construction Company, LLC, seek to avoid $814,180 in preferential transfers, and the disallowance of certain of Schimenti's claims. On May 5, 2008, the Debtors and Schimenti entered into a certain Agreement between Owner and Contractor - Stipulated Sum, pursuant to which Schimenti was to provide labor, material, equipment and services necessary for the proper management, construction, and completion of the Debtors' store located at 1022 US Route 22, in North Plainfield, New Jersey. On August 22, 2008, the parties entered into an agreement evidenced by a certain purchase order pursuant to which Schimenti was to provide labor, material, equipment and services necessary for the renovation of the Debtors' store located at 521 Fifth Avenue, in New York. According to Douglas M. Foley, Esq., at McGuireWoods LLP, in Richmond, Virginia, within 90 days before the Petition Date, the Debtors made multiple transfers of interest of the Debtors' property to or for the benefit of Schimenti in an amount not less than $814,180. He adds that during the course of this Adversary Proceeding, the Debtors may learn of additional transfers made to Schimenti during the Preference Period. The Debtors intend to avoid and recover all these transfers. Schimenti has filed Claim No. 966, asserting a priority claim pursuant to Section 503(b)(9) of the Bankruptcy Code in the amount of $47,682, against the Debtors for goods sold and services provided 20 days before the Petition Date. On April 30, 2010, the Court reclassified Claim No. 966 to a general unsecured non-priority claim. Schimenti also filed Claim No. 8448, asserting an unsecured claim in the amount of $812,861, against the Debtors for goods sold and services provided. The Debtors assert these counts against Schimenti: (1) Recovery of preferential transfers pursuant to Sections 547(b) and 550 of the Bankruptcy Code; and (2) Disallowance of claims pursuant to Section 502(d) of the Bankruptcy Code. The Debtors, hence, ask the Court to: (1) Enter an order pursuant to Section 550 of the Bankruptcy Code for avoidance of a preferential transfer pursuant to Section 547(b) in an amount not less than $814,180, plus costs, expenses, attorneys' fees, and interest at the legal rate pursuant to Section 550(a); and (2) Enter an order pursuant to Section 502(d) of the Bankruptcy Code, disallowing any claim of Schimenti against the Debtors' bankruptcy estates, including the Claims, unless and until Schimenti pays to the Debtors the amount of any and all judgments granted to the Debtors against Schimenti in the Adversary Proceeding. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. In May 2009, Systemax Inc., a multi-channel retailer of computers, electronics, and industrial products, acquired certain assets, including the name Circuit City, from the Debtors through a Court- approved auction. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). CMG HOLDINGS: Swings to $68,441 Net Income in Q1 2010 ----------------------------------------------------- CMG Holdings, Inc., filed its quarterly report on Form 10-Q, showing net income of $68,441 on $1,286,599 of revenue for the three months ended March 31, 2010, compared with a net loss of $154,681 on $212,394 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $1,659,067 in assets and $2,427,887 of liabilities, for a stockholders' deficit of $768,820. The Company has an accumulated deficit of $6,342,242 and a working capital deficit $1,692,372 as of March 31, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6325 MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company has suffered recurring losses from operations and has a working capital deficit as of December 31, 2009. Miami, Fla.-based CMG Holdings, Inc., is a marketing, sports, entertainment and management services company. The Company operates in the sectors of talent management, event management, and commercial rights. CNO FINANCIAL: Fitch Affirms All Ratings, Gives Stable Outlook -------------------------------------------------------------- Fitch Ratings has affirmed all the ratings assigned to CNO Financial Group, Inc. (formerly Conseco Inc.) and its subsidiaries and revised the Rating Outlook to Stable from Negative. The affirmation and Rating Outlook revision reflect the recent completion of capital transactions originally announced in October 2009, changes in the company's bank debt covenants and growing consistency in the company's operating results. CNO Financial improved its capital structure with a combination of equity issuance, debt repayment, debt restructuring and bank facility revisions (both March and December 2009). Completing these transactions allowed CNO Financial to avoid a qualified audit opinion for its 2009 financial statements and a resulting violation of its secured credit agreement. Key components of the improvement in capital structure include: -- Private placement of equity, warrants and debt with Paulson & Co. Inc. and its investment funds; -- Public equity issuance of approximately $235 million; -- Secured credit facility paydown of $198 million; -- Debenture maturity extension from 2010 to 2013 of $293 million; -- Removal of scheduled debt amortization for the bank credit facility for 2010. Collectively, these actions reduced the company's equity adjusted leverage to 22% at March 31, 2010 from approximately 27% at the time of the restructuring announcement. CNO Financial's total financing commitments ratio was 0.45 at March 31, 2010, which is consistent with industry norms. Estimated GAAP pre-tax interest coverage ratio is expected to be approximately 3 times in 2010, which is the same level as 2009. Fitch believes the emerging stability of CNO Financial's earnings profile and its ability to manage losses in its investment portfolio will play an important role in CNO Financial's ability to avoid covenant violations as covenant requirements become more restrictive over time. The company has now produced five consecutive quarters of positive operating earnings. This consistency is an improvement over previous results. As of March 31, 2010, the tightest covenant levels were under the statutory capital and interest coverage covenants. The covenant minimums for these measures were $1.2 billion and 1.5x versus actual results of $1.5 billion and 1.7x, respectively. A reasonable level of margin exists under the capital covenant and the company has some flexibility in managing intercompany capital flows which affect covenant calculations. CNO Financial and its non-insurance subsidiaries held unrestricted cash of $131 million at March 31, 2010. Based on Fitch's detailed analysis of CNO Financial's investment portfolio using its stress-testing methodology, Fitch's projection for gross investment losses before any offsetting gains is in the range of $350 million-$400 million through 2011. CNO Financial's continued generation of stable earnings free of significant special charges and its ability to improve the cushion versus its covenant requirements would be needed for Fitch to consider a positive rating action. Factors that could have a negative affect on ratings include a significant decline in operating earnings, increased investment losses beyond expectations and declines in statutory capital adequacy. Fitch has affirmed these ratings and revised the Rating Outlook to Stable from Negative: CNO Financial Group, Inc. -- Issuer Default Rating at 'B+'; -- Senior secured bank credit facility at 'B+/RR4'; -- Senior unsecured debt at 'B-/RR6'. Bankers Life and Casualty Company -- Insurer Financial Strength at 'BBB-'. Conseco Life Insurance Company Bankers Conseco Life Insurance Company Conseco Insurance Company Conseco Health Insurance Company Colonial Penn Life Insurance Company Washington National Insurance Company -- IFS at 'BB+'. COLONIAL BANCGROUP: FDIC Wants Case Converted to Chapter 7 ---------------------------------------------------------- Bankruptcy Law360 reports that the Federal Deposit Insurance Corp. is turning up the heat on Colonial Bancgroup Inc., claiming the bankrupt bank holding company must fork over millions in deposits and convert to a Chapter 7 liquidation proceeding to cover the $1.3 billion owed to the agency. Headquartered in Montgomery, Alabama, The Colonial BancGroup, Inc. (NYSE: CNB) was holding company to Colonial Bank, N.A, its banking subsidiary. Colonial bank -- http://www.colonialbank.com/ -- operated 354 branches in Florida, Alabama, Georgia, Nevada and Texas with over $26 billion in assets. On August 14, 2009, Colonial Bank was seized by regulators and the Federal Deposit Insurance Corporation was named receiver. The FDIC sold most of the assets to Branch Banking and Trust, Winston-Salem, North Carolina. BB&T acquired $22 billion in assets and assumed $20 billion in deposits of the Bank. The Colonial BancGroup filed for Chapter 11 bankruptcy protection on August 25, 2009 (Bankr. M.D. Ala. Case No. 09-32303). W. Clark Watson, Esq., at Balch & Bingham LLP and Rufus T. Dorsey IV, Esq., at Parker Hudson Rainer & Dobbs LLP, assist the Company in its restructuring effort. The Company listed $45,000,000 in assets and $380,000,000 in debts in its bankruptcy filing. COOPER-STANDARD: Expects to Exit Chapter 11 Tomorrow ---------------------------------------------------- Cooper-Standard Automotive Inc. said in a regulatory filing Monday that it expects to emerge from Chapter 11 reorganization on May 27. The bankruptcy judge in Delaware signed a confirmation order on May 12 approving the Plan. Under the Plan, the Debtors will pay the Holders of Prepetition Credit Facility Claims and Subsidiary Debtor General Unsecured Claims in full, in Cash, on the Effective Date. The Plan also provides that Holders of Senior Note Claims will be paid in full, in Cash, on the Effective Date, with the exception of the Supporting Senior Note Claims, who have agreed to receive their pro rata share of 4,563,095 shares of New Common Stock in exchange for their Senior Note Claims. In addition, Holders of Senior Subordinated Note Claims, who are impaired and made up the only voting class under the Plan, will receive (i) a direct distribution of 1,742,222 shares of New Common Stock, (ii) New Capital Warrants to purchase an additional 725,926 shares of New Common Stock, and (iii) Rights to purchase 8,623,491 of additional shares of New Common Stock pursuant to the Rights Offering. Holders of Holdings General Unsecured Claims and Old Holdings Equity Interests will not receive a distribution under the Plan and all existing common stock in Holdings will be cancelled. The Debtors will continue to hold all equity interests in their subsidiaries that they held prior to the filing of Chapter 11. On the Effective Date, the Debtors will fund the recoveries to their stakeholders under the Plan with a combination of cash-on- hand and their exit financing. In connection with the Plan, the Debtors have raised $355 million of equity through an equity rights offering and direct equity purchases by certain of the Debtors' existing unsecured noteholders, who have agreed to backstop the Rights Offering pursuant to the terms of that certain Commitment Agreement, dated as of March 19, 2010, by and between the Debtors and the Backstop Parties. The Debtors have also raised proceed from the issuance of $450 million aggregate principal amount of 8 1/2% Senior Notes due 2018 as part of their exit financing through the issuance of new notes. The New Notes are unsecured, bear interest at 8 1/ 2% per annum and will mature on May 1, 2018. The proceeds of the New Notes have been funded into escrow and will be made available to the reorganized Debtors on the Effective Date upon the satisfaction of certain conditions. In addition, the Debtors have received commitments for a new working capital facility in the aggregate principal amount of $125 million, which will also be available to the Debtors on the Effective Date. The New Working Capital Facility contains an uncommitted $25 million "accordion" facility that will be available at the borrowers' request if then-existing or additional lenders consent thereto. Overall, the Debtors will emerge from Chapter 11 with approximately $480 million of funded debt -- representing a reduction of over $650 million from prepetition levels. A copy of the reorganization plan is available for free at: http://researcharchives.com/t/s?6343 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- CORD BLOOD: Posts $2.5 Million Net Loss for March 31 Quarter ------------------------------------------------------------ Cord Blood America Inc. filed its quarterly report on Form 10-Q, showing a $2,578,827 net loss on $839,343 of total revenues for the three months ended March 31, 2010, compared with a $1,723,277 net loss on $941,938 of total revenues during the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $5,754,702 in total assets and $6,709,374 in total liabilities, all current, for a $954,672 total stockholders' deficit. The Company was not able to file its Form 10-Q on time. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?632b About Cord Blood America Based in Las Vegas, Nevada, Cord Blood America, Inc., is primarily a holding company whose subsidiaries include Cord Partners, Inc., CorCell Co. Inc., CorCell Ltd.; CBA Professional Services, Inc. D/B/A BodyCells, Inc.; CBA Properties, Inc.; and Career Channel Inc, D/B/A Rainmakers International. Cord specializes in providing private cord blood stem cell preservation services to families. BodyCells is a developmental stage company and intends to be in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy. Properties was formed to hold the corporate trademarks and other intellectual property of CBAI. Rain specializes in creating direct response television and radio advertising campaigns, including media placement and commercial production. As of December 31, 2009, the Company's total assets were $5.1 million against total liabilities of $5.2 million, resulting in stockholders' deficit of $39,396. In its March 30, 2010 report, Rose, Snyder & Jacobs, in Encino, California, said the Company's recurring operating losses, continued cash burn, and insufficient working capital and accumulated deficit at December 31, 2009, raise substantial doubt about the Company's ability to continue as a going concern. CRC HEALTH: Moody's Downgrades Corporate Family Rating to 'B3' -------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family and Probability of Default Ratings of CRC Health Corporation to B3 from B2. Moody's also downgraded the ratings on CRC's senior secured credit facility to B1 (LGD2, 27%) from Ba3 (LGD2, 28%) and affirmed the Caa1 (LGD5, 77%) rating on the company's senior subordinated notes. The rating outlook was changed to stable from negative. The Speculative Grade Liquidity Rating was affirmed at SGL-3. CRC's B3 Corporate Family Rating reflects the expectation that the company will continue to operate with very high leverage and modest interest expense coverage as operating pressures in the healthy living division have impeded improvements in credit metrics. While Moody's acknowledges the progress the company has made in reducing costs through its restructuring efforts, the operating difficulty has significantly reduced CRC's revenue base and delayed anticipated improvements in the credit profile of the company. Additionally, the SGL-3 rating reflects Moody's expectation of adequate liquidity going forward characterized by Moody's expectation that access to the undrawn revolver could be limited by covenants and the company's ability to comply with the financial covenants could grow less certain as compliance levels tighten in future periods. The stable outlook reflects Moody's expectation that the company will continue to benefit in the near term from the reduction of its cost base but could face continued pressure in growing the top line until broader economic conditions improve. The outlook also incorporates Moody's expectation that CRC could have difficulty improving credit metrics materially in the near term as EBITDA has remained relatively flat and free cash flow has benefited from a reduction in capital spending that is not likely to continue throughout the forecast period. This is a summary of Moody's rating actions. Ratings downgraded: * Corporate Family Rating, to B3 from B2 * Probability of Default Rating, to B3 from B2 * $100 million senior secured revolving credit facility, to B1 (LGD2, 27%) from Ba3 (LGD2, 28%) * $420 million senior secured term loan, to B1 (LGD2, 27%) from Ba3 (LGD2, 28%) Ratings affirmed/LGD assessments revised: * $200 million senior subordinated notes, to Caa1 (LGD5, 77%) from Caa1 (LGD5, 78%) * Speculative Grade Liquidity Rating, SGL-3 The rating outlook was changed to stable from negative. The last rating action was on January 29, 2009 when the rating outlook was changed to negative from stable and the Speculative Grade Liquidity rating was downgraded to SGL-3 from SGL-2. CRC's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record of tolerance for risk. These attributes were compared against other issuers both within and outside of CRC's core industry and CRC's ratings are believed to be comparable to those other issuers of similar credit risk. CRC is a wholly owned subsidiary of CRC Health Group, Inc. Headquartered in Cupertino, California, CRC's recovery division provides treatment services to patients suffering from chronic addiction diseases and related behavioral disorders. The company also, through its healthy living division, provides therapeutic educational programs for adolescents and treatment services for eating disorders and obesity. CRC recognized revenue of approximately $431 million for the twelve months ended December 31, 2010. DAVID STORTS: Case Summary & 22 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: David Gene Storts aka David G. Storts, MBR Spirit Wind Getaways LLC Sunset Falls Resort, LLC DGS Builders, LLC SMI Resources, Inc., dba Deer Run Store & Campground Fall Creek Apartments Wildwood Court Condo Association Sunset Park Resort, LLC Shortys, LLC Deer Run, LLC Bristol Falls Resort Corp. Music Rain, Inc. Wildwood Court, LLC Anita Sue Storts aka Anita Breedlove Spirit Wind Getaways LLC Sunset Falls Resort, LLC DGS Builders, LLC SMI Resources, Inc., dba Deer Run Store & Campground Fall Creek Apartments Wildwood Court Condo Association Sunset Park Resort, LLC Shortys, LLC Deer Run, LLC Bristol Falls Resort Corp. Music Rain, Inc. Wildwood Court, LLC 209 Faith Drive Forsyth, MO 65653 Bankruptcy Case No.: 10-61243 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Western District of Missouri (Springfield) Judge: Arthur B. Federman Debtor's Counsel: David E. Schroeder, Esq. David Schroeder Law Offices, PC 1524 East Primrose Street, Suite A Springfield, MO 65804-7915 Tel: (417) 890-1000 Fax: (417) 886-8563 E-mail: bk1@dschroederlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Joint Debtors' list of 22 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mowb10-61243.pdf The petition was signed by the Joint Debtors. DOVEVIEW LLC: Section 341(a) Meeting Scheduled for June 11 ---------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of Doveview, LLC's creditors on June 11, 2010, at 10:00 a.m. The meeting will be held at the U.S. District Court, 844 King St., Room 2112, Wilmington, Delaware. This is the first meeting of creditors required under Section 341(a) of the U.S. 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. Wilmington, Delaware-based Doveview, LLC, filed for Chapter 11 bankruptcy protection on May 5, 2010 (Bankr. D. Del. Case No. 10- 11519). Steven M. Yoder, Esq., at Potter Anderson & Corroon LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. DUQUESNE LIGHT: Moody's Affirms 'Ba1' Senior Unsecured Ratings -------------------------------------------------------------- Moody's Investors Service has affirmed the ratings and stable outlooks of Duquesne Light Holdings, Inc., and its regulated electric utility subsidiary, Duquesne Light Company. Ratings affirmed include: -- Duquesne Light Holdings senior unsecured, Ba1; stable outlook -- Duquesne Light Company senior secured, A3; stable outlook -- Duquesne Light Company issuer rating at Baa2; stable outlook -- Duquesne Light Company preferred stock at Ba1; stable outlook The affirmation reflects the benefits of recent decisions by the company to stabilize its capital structure as well as Moody's expectation that future actions to be taken over the next 12-18 months could slowly begin to improve DLH's credit profile. DLH has exhibited a leveraged credit profile for a number of years. The debt at the parent level is a legacy of the company's 2007 buyout, led by an investor consortium including Macquarie Infrastructure Partners and Diversified Utility & Energy Trust. Since that time there has been no notable improvement in consolidated credit metrics. However, in 2009 the consortium took several positive steps including cutting the upstream dividend from DLH and contributing additional equity of $200 million. These actions helped to offset the negative impact of higher capacity costs in PJM that have negatively affected operating results. As a result, DLH's 2009 CFO (pre-w/c) to debt was approximately 1O%, and RCF to debt was 9%; both at the high end of the Ba1 rating category. DLC continues to be strongly positioned at the Baa2 rating level with CFO (pre-w/c) to debt of 25% in 2009. Additional clarity on the company's POLR obligations was communicated on May 20, 2010, when the Pennsylvania Public Utility Commission approved DLC's plan to provide fixed-price default service to residential customers for the period Jan-2011 through May-2013. Unlike other pure transmission and distribution utilities in Pennsylvania, DLC continues to retain an element of risk with the new POLR V plan as power supply is not a direct pass-through and the company must carefully hedge its obligations though the POLR period. Additionally, to the extent power prices decline the company will be subject to "switching risk" given customer choice availability in PA. More positively, there is now greater certainty on capacity costs through mid-2014 and this cost is now considered in the established average rate of $78.60/MWh under POLR V. While Moody's note the positive improvements to the capital structure and the prospect for strengthening given the current dividend policy, Moody's are affirming the ratings at the current levels given the continued leveraged capital structure. Specifically, the notching differential between DLH and DLC continues to reflect the significant level of parent holding company debt, and the structural and contractual subordination to debt at the company's core regulated electric utility operating subsidiary, DLC, and DLH's primary dependence on cash flows from DLC which represented 70 % of consolidated cash from operations in 2009 to service that debt. At March 31, 2010 debt at the holding company represented approximately 75% of consolidated debt. The last rating action for Duquesne was on August 3, 2009, when DLC's senior secured ratings were upgraded one notch to A3 in line with Moody's sector-wide review of first mortgage bonds in the utility sector. Headquartered in Pittsburgh, Pennsylvania, Duquesne Light Holdings is an electric utility holding company owned by an investor consortium led by Macquarie Infrastructure Funds and Diversified Utility Energy Trust. Revenue for the year ended December 31, 2009, was $1.1 billion. Its primary operating subsidiary, Duquesne Light Company, is primarily engaged in providing transmission, distribution and supply of electricity to approximately 588 thousand customers in Southwestern Pennsylvania. EAU TECHNOLOGIES: Posts $223,271 Net Loss for March 31 Quarter -------------------------------------------------------------- EAU Technologies Inc. filed its quarterly report Form 10-Q, showing a $223,271 net loss on $162,401 of total revenues for the three months ended March 31, 2010, compared with a $154,650 net loss on $941,938 of total revenues during the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $3.1 million in total assets and $10.7 million in liabilities, all current, for a $7.5 million total stockholders' deficit. The Company did not file its Form 10-Q on-time. A full-text copy of the company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?632c Kennesaw, Ga.-based Eau Technologies, Inc., is in the business of developing, manufacturing and marketing equipment that uses water electrolysis to create non-toxic cleaning and disinfecting fluids as well as dairy drinking water. According to the Troubled Company Reporter on April 7, 2010, the Company's balance sheet as of December 31, 2009, showed $3,407,770 in assets and $14,229,820 of debts, for a stockholders' deficit of $10,822,050. HJ & Associates, LLP, in Salt Lake City, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has a working capital deficit and a stockholders' deficit. EFP, INC.: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------- Debtor: EFP, Inc. c/o James F.B. Daniels McDowell Rice Smith & Buchanan, PC 605 W. 47th Street, Suite 350 Kansas City, MO 64112 Tel: (816) 753-5400 Bankruptcy Case No.: 10-42632 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Western District of Missouri (Kansas City) Judge: Jerry W. Venters Debtor's Counsel: James F. B. Daniels, Esq. McDowell Rice Smith & Buchanan 605 W. 47th Street, Suite 350 Kansas City, MO 64112 Tel: (816) 960-7307 Fax: (816) 753-9996 E-mail: jdaniels@mcdowellrice.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 According to the schedules, the Company says that assets total $6,360,000 while debts total $875,971. A copy of the Company's list of 6 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mowb10-42632.pdf The petition was signed by G. Wayne Reeder, CEO. EMISPHERE TECHNOLOGIES: Posts $18.4MM Net Loss for March 31 Qtr --------------------------------------------------------------- Emisphere Technologies Inc. filed its quarterly report on Form 10- Q, showing a $18,465,000 net loss on $12,000 of total revenues for the three months ended March 31, 2010, compared with a net loss of $5,417,000 net loss on $0 net sales during the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $5,100,000 in total assets and $71,000,000 in total current liabilities, for a total stockholders' deficit of $65,900,000. The Company has implemented aggressive cost controls to conserve its cash and better position the Company to realize the commercial promise of its Eligen Technology. With its lower cash burn rate, the Company anticipates that its existing capital resources, without implementing cost reductions, raising additional capital, or obtaining substantial cash inflows, will enable us to continue operations through approximately June 2010 or earlier if unforeseen events arise that negatively affect the company's liquidity. The company's management said it believes there are reasonable financing alternatives potentially available to the Company that will enable it to meet its near term operating cash requirements. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?632d Cedar Knolls, N.J.-based Emisphere Technologies, Inc. (OTC BB: EMIS) -- http://www.emisphere.com/-- is a biopharmaceutical company that focuses on a unique and improved delivery of therapeutic molecules or nutritional supplements using its Eligen(R) Technology. FALLON LUMINOUS: Court Reconsiders Recent Order on Infringement --------------------------------------------------------------- The Federal Court of Appeals is reconsidering its decision regarding Fallon Luminous Products Corporation's patent infringement of iLight Technologies Inc.'s patents. On April 20, the Court of Appeals cited a single claim construction ruling by the trial court as the reason for setting aside a $5 million patent infringement judgment against Fallon and sending the case back to the District Court for further proceedings. Because that single claim construction ruling did not involve all patent claims found by the jury to be infringed by Fallon, iLight submitted a Petition for Rehearing to reinstate the judgment. The Court of Appeals requested a response from Fallon, which Fallon filed last week, and will rule on iLight's Petition for Rehearing. Court of Appeals April 20th Ruling Confirms the Validity of iLight's Patents In its appeal effort, Fallon made numerous arguments including: iLight patents were invalid, Fallon did not infringe, and the case should be remanded for retrial for various technical reasons. The Court of Appeals rejected Fallon's invalidity arguments and cited a single claim construction issue as the reason for sending the case back to the trial court for further consideration of the issue of Fallon's infringement of iLight's patents. Sean Callahan, President and CEO of iLight said, "We are very pleased the Court of Appeals confirmed the judgment of the jury that the claims of all three iLight patents, that were found by the jury to have been willfully infringed by Fallon, are valid." Callahan adds, "Based on the single claim construction issue raised by the Court of Appeals, should a retrial be needed, we are confident that a jury will again conclude that Fallon infringed our patents. While we certainly understand why other companies wish to use our technology, we are committed to protecting all of iLight's intellectual property." Permanent Injunction Against Fallon Continues in Full Force The District Court previously issued a permanent injunction that prohibits Fallon, and all acting in concert with Fallon, from manufacturing, importing, using, or selling Fallon's infringing LED products. Unless and until a "mandate" is issued from the Court of Appeals to the trial court stating differently and providing directions to the trial court for further proceedings against Fallon for infringement of the iLight patents, the permanent injunction against Fallon remains in full force. Fallon's Press Release Is Quite Different From Fallon's Bankruptcy Filings Fallon issued a press release on April 21 portraying the ruling as a victory and Fallon's CEO is quoted as saying, "We believe this ruling validates ... that our products do not violate iLight's patents." However, in a filing with the bankruptcy court overseeing Fallon's bankruptcy proceedings, Fallon, more candidly, stated, "The case was remanded to the District Court for further proceedings consistent with specific technical instructions." Callahan comments, "iLight is not surprised by Fallon's misleading press release." The jury in the patent infringement case determined that Fallon's infringement of the iLight patents was "willful"; the judge declared the case "exceptional" and awarded iLight attorney's fees based on Fallon's conduct; and a different federal judge who presides over Fallon's bankruptcy proceedings decided to appoint a Chapter 11 Trustee, who is independent of Fallon, to oversee Fallon's business in bankruptcy. About Fallon Fallon is owned by the investment firm Lincolnshire Management and managing directors of Lincolnshire Management fill multiple management positions of Fallon, including CEO, President, and COO. FIRST DATA: May 13 Amendment Won't Affect Fitch's 'B' Rating ------------------------------------------------------------ Fitch Ratings expects that proposed limits on debit card interchange fees, as contained in a Senate Amendment passed May 13, should be neutral to First Data Corp.'s expected financial performance going forward. The proposed regulation, if passed into law, would limit Visa and Mastercard's ability to determine interchange fees for all card issuers with assets over $10 billion (which the senate estimates at 1% of total card issuers). Instead, interchange fees will be determined by each bank with maximum limits set by the Federal Reserve. The amendment is intended only for debit cards and does not include credit cards. Fitch does not believe that the proposed regulation directly impacts FDC's Retail and Alliance Services business. Specifically, FDC prices its service to merchants either as a flat fee inclusive of interchange or as a set fee with interchange as a pass through (i.e. interchange plus 20 basis points). In the scenario where FDC prices its service inclusive of interchange, the company would only be negatively impacted if interchange were to increase. In all other scenarios, interchange is effectively a pass through expense. It is possible that FDC's Star Network (debit card processing) could be negatively affected by the proposed regulation. However, Fitch believes that Star is a relatively minor contributor to FDC's overall cash flow and that the proposed regulation primarily impacts signature debit card transactions which are processed outside of the Star Network. Furthermore, any negative implications for FDC's Financial Services segment (which includes Star) would likely be offset by potential positive impacts of the proposed regulation. Specifically, the limit on interchange fees could cause more retailers to begin accepting debit/credit cards for purchases which could boost the secular shift to card based transactions. Additionally, a decrease in debit card interchange could incentivize issuing banks to focus marketing efforts on credit cards in lieu of debit cards, by scaling back debit card reward programs for instance. This would positively impact FDC's Retail and Alliance Services business as it typically earns a higher fee on credit card transactions versus PIN debit. As a final note, FDC's first quarter results were in-line with Fitch's expectations inherent in its May 3, 2010 rating affirmation and press release. As stated in the release and considered in the rating, Fitch does not expect FDC to be positioned for an initial public offering for several years. The company's current debt maturation schedule would likely necessitate an equity offering sometime in the 2013 timeframe but not before, based on Fitch's assumption that free cash flow will increase sufficiently to manage higher cash interest expense beginning in 2012 when the first cash payment is due on the company's senior unsecured 10.55% PIK notes. Fitch currently rates FDC: -- Long-term Issuer Default Rating 'B'; -- $2 billion senior secured revolving credit facility (RCF) due 2013 'BB-/RR2'; -- $13 billion senior secured term loan B due 2014 'BB-/RR2'; -- $3.75 billion 9.875% senior unsecured notes due 2015 'CCC/RR6'; -- $3 billion 10.55% senior unsecured notes with four-year mandatory paid-in-kind (PIK) interest due 2015 'CCC/RR6'; -- $2.5 billion 11.25% senior subordinated notes due 2016 'CC/RR6'. The Rating Outlook is Stable. Total liquidity as of March 31, 2010, was solid and consisted of $731 million in cash and $1.4 billion available under a $2 billion senior secured RCF that expires September 2013. The reduced availability under the RCF reflects approximately $230 million which was provided by an affiliate of Lehman Brothers and is no longer available to be borrowed upon as well as letters of credit and borrowings currently outstanding. Fitch expects approximately $230 million of the existing cash balances to be used for the 5% Rockmount put option on the company's Bank of America joint venture in June 2010. Total debt as of March 31, 2010, was approximately $23 billion and consisted primarily of these: i) $12.5 billion outstanding under a secured term loan B maturing September 2014; ii) $293 million drawn on the company's $2 billion RCF which expires September 2013; iii) $3.75 billion in 9.875% senior unsecured notes maturing September 2015; iv) $3.5 billion in 10.55% notes maturing September 2015 with mandatory PIK interest through September 2011 and cash interest thereafter; and v) $2.5 billion of 11.25% senior subordinated notes maturing September 2016. In addition, the parent company of FDC, First Data Holdings, Inc., has outstanding approximately $1 billion original value senior unsecured PIK notes due 2016. FONAR CORP: Posts $8,000 Net Loss in Q3 Ended March 31 ------------------------------------------------------ Fonar Corporation filed its quarterly report on Form 10-Q, showing a net loss of $8,000 on $7.5 million of revenue for the three months ended March 31, 2010, compared with net income of $730,000 on $11.3 million of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $23.2 million in assets and $29.0 million of liabilities, for a stockholders' deficit of $5.8 million. As reported in the Troubled Company Reporter on October 9, 2009, Marcum LLP, in New York, N.Y., expressed substantial doubt about FONAR Corporation's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended June 30, 2009. The auditing firm noted that that the Company has suffered recurring losses from operations, continues to generate negative cash flows from operating activities, has negative working capital at June 30, 2009, and is dependent on asset sales to fund its shortfall from operations. The Company still suffers recurring losses from operations, continues to generate negative cash flows from operating activities and had negative working capital at March 31, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6337 Fonar Corporation (NASDAQ: FONR) engages in the design, manufacture, sale, and service of magnetic resonance imaging (MRI) scanners for the detection and diagnosis of human diseases. The Company, through its wholly owned subsidiary, Health Management Corporation of America, also provides management services, administrative services, office space, equipment, repair, maintenance service and clerical and other non-medical personnel to diagnostic imaging centers. The Company was founded in 1978 and is headquartered in Melville, New York. FRASER PAPERS: Signs Agreement to Sell New Hampshire Paper Mill --------------------------------------------------------------- Fraser Papers Inc. disclosed that its subsidiary Fraser N.H. LLC, has reached an agreement to sell substantially all of its assets to an investment fund managed by MerchantBanc, LLC, of Manchester, NH. Financial terms of the transaction were not disclosed. The paper mill in Gorham, New Hampshire currently operates three paper machines and produced 80,000 tons of uncoated freesheet papers and 37,000 tons of towel products in 2009. The transaction is expected to close in late July and is subject to approval of the Ontario Superior Court of Justice (Commercial List) and the United States Bankruptcy Court for the District of Delaware. Fraser Papers remains under creditor protection pursuant to the provisions of the Companies' Creditors Arrangement Act, with its stay of proceedings having been extended by the court to July 9, 2010. Fraser Papers -- http://www.fraserpapers.com/-- is an integrated specialty paper company that produces a broad range of specialty packaging and printing papers. The Company has operations in New Brunswick, Maine, New Hampshire and Quebec. On June 18, 2009, citing continued operating losses, weak markets for pulp and lumber, impending debt repayments and significant pension funding obligations, the Company and its subsidiaries filed for protection under the Companies Creditors Arrangement Act (Ont. Super. Ct. J. Ct. File No. CV-09-8241-00CL) in Toronto and Chapter 15 (Bankr. D. Del. Case No. 09-12123) of the U.S. Bankruptcy Code. Fraser is represented by Michael Barrack, Esq., Robert I. Thornton, Esq., and D.J. Miller, Esq., at ThorntonGroutFinnigan LLP, in Toronto, and Derek C. Abbott, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Del. With adequate financing to support continuing operations, Fraser says it is developing a restructuring plan to present to its creditors -- hopefully by Oct. 16, 2009 -- with the objective of emerging with a sustainable and profitable specialty papers business. GATEWAY ETHANOL: Court Extends DIP Loan Expiry Until May 31 ----------------------------------------------------------- The Hon. Dale L. Somers of the U.S. Bankruptcy Court for the District of Kansas approved a tenth amendment to the stipulated final order, authorizing Gateway Ethanol, LLC, to: -- obtain $9,890,500 of secured postpetition financing; and -- grant security interests, super-priority claims and adequate protection to the prepetition senior lender and the DIP lender. The Debtor related that it was unable to obtain unsecured credit as an administrative expense, and is seeking to amend the terms of the postpetition loan documents in order to seek additional postpetition financing. The DIP lender consented to the amendment of the terms and conditions of the postpetition financing. The DIP facility will expire on May 31, 2010. Pratt, Kansas-based Gateway Ethanol, LLC, operates an ethanol plant that has a capacity of 55 million gallons a year, according to Orion Ethanol's Web site. The Company filed for bankruptcy protection on October 5, 2008 (Bankr. D. Ks., Case No. 08-22579). Laurence M. Frazen, Esq., Megan J. Redmond, Esq., and Tammee E. McVey, Esq., at Bryan Cave, LLP, represent the Debtor in its restructuring effort. In its schedules, the Debtor listed total assets of $94,545,022, and total debts of $93,353,654. GENERAL DATACOMM: Posts $1.2 Million Net Loss for March 31 Quarter ------------------------------------------------------------------ General DataComm Industries Inc. filed its quarterly report on Form 10-Q, showing a net loss of $1.2 million on $1.5 million of total revenues for the three months ended March 31, 2010, compared with a net loss of $2.1 million on $2.0 million of net sales during the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $5.5 million total assets and $47.6 million total current liabilities, for a $42.0 million total stockholders' deficit. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?632e About General DataComm Based in Naugatuck, Connecticut, General DataComm Industries Inc. (OTC: GNRD) -- http://www.gdc.com/-- is a provider of networking and telecommunications products, services and solutions. The Company designs, develops, assembles, markets, sells, installs and maintains products that enable telecommunications common carriers, corporations, and governments to build, improve and more cost effectively manage their global telecommunications networks. The Company's products and services are marketed worldwide through a combination of direct sales and distribution channels. * * * According to the Troubled Company Reporter on Feb. 22, 2010, the company reported $5.92 million in total assets and $46.77 million in total liabilities resulting to a $40.85 million stockholders' deficit at Dec. 31, 2009. GENERAL GROWTH: Wins Confirmation of Last Property-Owning Unit -------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that General Growth Properties Inc. wrapped up formal reorganizations for the last of its 144 properties when the bankruptcy judge agreed to confirm a Chapter 11 plan restructuring the mortgage loan on a property in Louisiana. General Growth has now confirmed plans covering property-owning subsidiaries with $15 billion spread among 108 loans. According to Bloomberg, General Growth is moving ahead to confirm a reorganization plan for the holding company that will pay all creditors in full, just like the plans for the subsidiaries. The bankruptcy judge sanctioned an auction where the opening offer will come from Brookfield Asset Management Inc., Fairholme Capital Management LLC and Pershing Square Capital Management LP. The auction will determine who makes the best offer to finance the holding company's reorganization and end up owning part of the stock. Other investors can submit competing proposals by June 2. General Growth will pick the best proposal by July 2. The hearing for approval of a disclosure statement will take place July 30, with the confirmation hearing for approval of the plan to take place Sept. 30. 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) GENESIS FLUID: Posts $1.2 Million Net Loss in Q1 2010 ----------------------------------------------------- Genesis Fluid Solutions Holdings, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $1,220,760 for the three months ended March 31, 2010, compared with a net loss of $350,559 for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $5,181,430 in assets, $2,395,323 of liabilities, and $2,786,107 of stockholders' equity. Salberg & Company, P.A., in Boca Raton, Fla., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company reported a net loss and used cash in operations of $2,247,767 and $1,737,841, respectively, in 2009. In addition, as of December 31, 2009, the Company had an accumulated deficit of $6,217,899, has minimal revenue generating activities and is transitioning to a new business model. For the three months ended March 31, 2010, the Company had a net loss of $1,220,760 and used cash in operations of $661,699. At March 31, 2010, the Company had an accumulated deficit of $7,438,659. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6335 Colorado Springs, Colo.-based Genesis Fluid Solutions Holdings, Inc. is engaged in the design and development of waterway restoration, mining, and paper mill (water) remediation technologies. GEORGE PAGLIARO: Section 341(a) Meeting Scheduled for June 16 ------------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of George Rodolfo Pagliaro and Pamela Jean Pagliaro's creditors on June 16, 2010, at 11:00 a.m. The meeting will be held at Room 1-159, 411 W Fourth Street, Santa Ana, CA 92701. This is the first meeting of creditors required under Section 341(a) of the U.S. 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 Clemente, California-based George Rodolfo Pagliaro and Pamela Jean Pagliaro, dba Pagliaro Construction Inc., filed for Chapter 11 bankruptcy protection on May 5, 2010 (Bankr. C.D. Calif. Case No. 10-15975). Vincent Renda, Esq., at Renda Law Offices PC, assists the Debtors in their restructuring efforts. The Debtors estimated their assets and debts at $10,000,001 to $50,000,000. GREEKTOWN HOLDINGS: Casino April Revenues Total $31.9 Million ------------------------------------------------------------- The Michigan Gaming Control Board stated in its Web site that Greektown Casino's aggregated revenues for April 2010 is $31,981,992. Of this revenue, Greektown Casino's state wagering tax is $0. The Gaming Board also released the April 2010 revenues of two other Detroit casinos, MGM Grand Detroit and MotorCity Casino. The Board notes that MGM Grand Detroit earned $49,605,147 and MotorCity Casino had $37,322,007 in revenues. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC, and its affiliates -- http://www.greektowncasino.com/-- operate world- class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The Company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC as claims, noticing, and balloting agent. Clark Hill PLC serves as counsel to the Official Committee of Unsecured Creditors. Greektown Holdings listed assets and debts of $100 million to $500 million in its bankruptcy petition. Bankruptcy Creditors' Service, Inc., publishes Greektown Casino Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Greektown Casino and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GREEKTOWN HOLDINGS: Receives Court Nod to Hire PGH & HAG -------------------------------------------------------- Greektown Holdings Inc. and its units sought and obtained authority to employ PGH Consulting LLC and Hospitality Advisors Group as hotel valuation consultants and expert witnesses. The Debtors assert that they require the assistance of the Appraisers to determine the market value of their hotel and attached parking deck in connection with property tax contests for tax years 2008, 2009, and 2010. Hospitality Advisors will be responsible for the research and drafting of the opinion of value for the tax years at issue. Hospitality Advisors and the Debtors' special tax counsel, Honigman Miller Schwartz and Cohn LLP, will consult with PGH regarding certain appraisal issues critical to the valuation of the Hotel Property. The Debtors assert that the Appraisers are well-qualified to act on their behalf, given the firm's extensive knowledge and experience in real property appraisal generally, and hotel properties in particular. In conjunction with the Tax Assessment Contests, the Debtors relate that they need the Appraisers to perform these services: a. Valuation of the Hotel Property as of December 31, 2007, December 31, 2008, and December 31, 2009 b. Advice with respect to valuation matters; and c. Potential testimony as experts or fact witnesses in the Tax Assessment Contests The Debtors will pay Hospitality Advisors $26,000 plus a $250 hourly rate for preparations, attendance, and participation in depositions and pre-trial and trial activity. The Debtors will pay PGH $450 per hour to consult with a special tax counsel and Hospitality Advisors. If necessary, PGH will be asked to prepare for, attend, and provide pretrial and trial services, including expert testimony. The Appraisers will apply to the Court for expense reimbursement or allowances of compensation for all services it provides to the Debtors in accordance with applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, the Local Rules of Bankruptcy Procedure, and orders of the Court, and guidelines established by the United States Trustee. David C. Lennoff, president of PGH; and Laurence G. Allen, president of Hospitality Advisors, assure the Court that their firms have no interests that are adverse to the Debtors or their estates. Accordingly, each of PGH and Hospitality Advisors is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC, and its affiliates -- http://www.greektowncasino.com/-- operate world- class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The Company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC as claims, noticing, and balloting agent. Clark Hill PLC serves as counsel to the Official Committee of Unsecured Creditors. Greektown Holdings listed assets and debts of $100 million to $500 million in its bankruptcy petition. Bankruptcy Creditors' Service, Inc., publishes Greektown Casino Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Greektown Casino and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GSI GROUP: Schedules May 27 Plan Confirmation Hearing ----------------------------------------------------- Bill Rochelle at Bloomberg News reports that GSI Group Inc. scheduled a confirmation hearing on May 27 for approval of a modified reorganization plan following settlement with existing shareholders. The new plan allows shareholders to retain as much as 87.3% of the stock if they participate to the maximum in a $85 million equity rights offering. If stockholders buy to the fullest extent, noteholders will have 12.7% of the reorganized equity and $90 million in new secured notes. The Official Committee of Equity Security Holders supports the Plan. "The current plan represents a substantial improvement to the original plan, which would have left shareholders with only 18% of the equity of GSI," said Stephen W. Bershad, Chairman of the Equity Committee. "Under the current plan, which represents the culmination of the Equity Committee's negotiations with GSI and certain holders of GSI's senior notes, if GSI shareholders exercise in full their right to buy additional shares of GSI, they may continue to own over 87% of the equity of GSI following emergence from bankruptcy. The modified plan will also significantly reduce GSI's funded debt, positioning GSI to grow its businesses and capitalize upon future opportunities." About GSI Group Bedford, Mass.-based GSI Group Inc. -- http://www.gsig.com/-- designs, develops, manufactures and sells photonics-based solutions (consisting of lasers, laser systems and electro-optical components), precision motion devices, associated precision motion control technology and systems. The Company's customers incorporate the Company's technology into their products or manufacturing processes, for a wide range of applications in the industrial, scientific, electronics, semiconductor, medical and aerospace. The Company and two of its affiliates filed for Chapter 11 protection on Nov. 20, 2009 (Bankr. D. Del. Lead Case No. 09- 14110). William R. Baldiga, Esq., at Brown Rudnick LLP, represents the Debtors as lead counsel. Mark Minuti, Esq., at Saul Ewing LLP, as its local counsel. The Debtors selected Garden City Group Inc. as their claims and notice agent. In their petition, the Debtors posted $555,000,000 in total assets and $370,000,000 in total liabilities as of Nov. 6, 2009. GUNDLE/SLT ENVIRONMENTAL: Moody's Junks Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service downgraded the debt ratings of Gundle/SLT Environmental, Inc. The company's Corporate Family Rating and Probability of Default ratings were downgraded to Caa1 from B3. The speculative grade liquidity rating remains at SGL-3 and the ratings outlook is stable. The ratings downgrade was prompted by Moody's belief that the company's credit metrics are unlikely to demonstrate meaningful improvement in the near-term even though Gundle continues to strive to improve its profitability. The company's credit metrics are below levels Moody's had previously stated could result in a ratings downgrade. As importantly, Moody's does not expect material, near-term improvement in leverage or interest coverage particularly as waste volumes remain depressed -- the waste sector is Gundle's largest end market. Moreover, raw material cost volatility may be a greater source of headwind than the company's contracts and pricing schemes can efficiently absorb. The weak global economy hurts demand for the company's liners. The slowdown in construction activity results in less construction waste being created and in general there has been lower landfill volume and therefore lower demand for Gundle's liners. Tighter municipal budgets have also hurt demand as certain capital improvement projects continue to be deferred. Although mining demand is stronger year over year, the global economy's weakness hurts demand from the mining industry which relies on Gundle's products for containment pools. The company's aquaculture business has also been affected. As a result of these and other factors, Moody's expects the company's credit quality to remain weak into 2010/11 even though Moody's expect U.S. GDP growth in the low single digits. The stable outlook reflects the belief that the company's credit metrics should show signs of stabilization as a growing global economy stimulates demand. The SGL-3 speculative grade liquidity rating reflects the belief that the company has adequate liquidity. Although Moody's does not expect Gundle to generate meaningful cash flow in 2010, the ABL revolver is largely undrawn and could support higher net working capital investment should volumes improve or resin prices increase. Moody's does not expect availability under the company's ABL revolver to fall below $5 million; the sole financial covenant, fixed charge coverage, would therefore not be applicable. The last rating action was on December 21, 2009, when the company's Corporate Family Rating was changed to B3. Downgrades: Issuer: Gundle/SLT Environmental Inc. -- Probability of Default Rating, Downgraded to Caa1 from B3 -- Corporate Family Rating, Downgraded to Caa1 from B3 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Caa2, LGD4, 64% from Caa1, LGD4, 62% Gundle/SLT Environmental, Inc., based in Houston, TX, is a leading manufacturer of geosynthetic lining products used in environmental protection and for the confinement of solids, liquids and gases in the waste management, liquid containment and mining industries. Gundle markets its products and installation services through internal and third-party distribution channels. LTM revenues through March 31, 2010, totaled $295 million. HARRISBURG, PA: Agency to Miss $1.4-Mil. June 1 Debt Payment ------------------------------------------------------------ American Bankruptcy Institute that Harrisburg Authority, the agency that owns Harrisburg, Pa.'s debt-laden and problem-plagued incinerator, once again will miss payments on its bonds, leaving the city and Dauphin County to step in as guarantors. Harrisburg is coping with $288 million in debt related to a failed revamp of an incinerator. The $68 million in payments on the debt this year exceed the city's annual budget. HYRDROL-PRO TECHNOLOGIES: Case Summary & Creditors List ------------------------------------------------------- Debtor: Hyrdrol-Pro Technologies, Inc. 40420 Freefall Avenue Zephyrhills, FL 33542 Bankruptcy Case No.: 10-12334 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Ronald R. Bidwell, Esq. Law Office of Ronald R Bidwell PA 1205 W Fletcher Avenue Suite B Tampa, FL 33612 Tel: (813) 908-7700 Fax: (813) 962-6156 E-mail: rbidwell1@tampabay.rr.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb10-12334.pdf The petition was signed by Mary L. Morris, CEO. INFOLOGIX INC: Posts $2.8 Million Net Loss for March 31 Quarter --------------------------------------------------------------- InfoLogix Inc. filed its quarterly report on Form 10-Q, showing a $2.8 million net loss on $13.8 million of net revenues for the three months ended March 31, 2010, compared with a $4.5 million net loss on $18.8 million of net revenues during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $34.0 million in total assets and $39.0 million in total liabilities, for a total stockholders' deficit of $4.9 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?633b Hatboro, Pa.-based InfoLogix, Inc. (NASDAQ: IFLG) -- http://www.infologix.com/-- is a provider of enterprise mobility solutions for the healthcare and commercial industries. The Company's balance sheet as of December 31, 2009, showed $33.9 million in assets and $38.5 million of debts, for a stockholders' deficit of $2.5 million. McGladrey & Pullen, LLP, in Blue Bell, Pa., 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, has negative working capital and an accumulated deficit as of December 31, 2009. IXI MOBILE: Delays Filing of Quarterly Report on Form 10-Q ---------------------------------------------------------- IXI Mobile Inc. said it could not file its quarterly report Form 10-Q for the period ended March 31, 2010, on time with the Securities and Exchange Commission. The Company said, as a result of the initiation of several strategic measures intended to refocus its activities and to reduce operating costs, it has not finalized its financial statements for the quarter ended September 30, 2008, for the year ended December 31, 2008, for the quarters ended March 31, 2009, June 30, 2009 or September 30, 2009, for the year ended December 31, 2009, and for the quarter ended March 31, 2010. The Company's auditors have not finalized their review or audit of these financial statements and the Company is not currently in a position to estimate the results for the interim periods or the year end periods for which these reports have not been filed. The Company said it believes that it will need to raise additional capital in the near future in order to continue as a going concern, and there can be no assurance that it will be successful in doing so or that, even if the Company is able to raise additional capital, such capital will be sufficient to allow the Company to continue as a going concern. About IXI Mobile Headquartered in Belmont, California, IXI Mobile Inc. (OTC BB: IXMO.0B) -- http://www.ixi.com/-- provides devices and hosted services to mobile operators, mobile virtual network operators, and Internet service providers in a number of international markets. Research and development activities are conducted primarily in its facilities in Israel and Romania. * * * As reported by the Troubled Company Reporter on August 28, 2008, IXI Mobile's consolidated balance sheet at June 30, 2008, showed $29,504,000 in total assets and $40,856,000 in total liabilities, resulting in a $11,352,000 stockholders' deficit. The company reported a net loss of $11,387,000 on total revenues of $2,221,000 for the second quarter ended June 30, 2008, compared with a net loss of $21,508,000 on total revenues of $3,171,000 in the same period ended June 30, 2007. LA JOLLA PHARMACEUTICAL: Posts $1,767,000 Net Loss in Q1 2010 ------------------------------------------------------------- La Jolla Pharmaceutical Company filed its quarterly report on Form 10-Q, showing a net loss of $1,767,000 on no revenue for the three months ended March 31, 2010, compared with a net loss of $4,252,000 on $8,125 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $3,708,000 in assets, $1,033,000 of liabilities, and $2,675,000 of stockholders' equity. Ernst & Young LLP, in San Diego, Calif., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the the Company has incurred recurring operating losses, an accumulated deficit of $424,321,000 as of December 31, 2009, and has no current source of revenues or financing. As of March 31, 2010, the Company had no revenue sources, an accumulated deficit of $426,088,000, and available cash and cash equivalents of $3,627,000. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?633a San Diego, Calif.-based La Jolla Pharmaceutical Company is a biopharmaceutical company that has historically focused on the development and testing of Riquent as a treatment for Lupus nephritis. LANDRY'S RESTAURANTS: S&P Retains Negative Watch on 'B' Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said that its 'B' corporate credit rating and all related issue-level ratings on Houston-based Landry's Restaurants Inc. remain on CreditWatch with negative implications. This action comes after the company announced that CEO Tilman Fertitta would increase his offer to take the company private to $24 per share from $21, which is 62% higher than the original $14.75 per share price. The company's Board of Directors has approved the amended agreement and recommended that shareholders vote in favor of the new offer. Also the company has reached a partial settlement to resolve a derivative claims against Fertitta, affiliates of Fertitta, and the company's directors. The consummation of the merger is conditioned upon the dismissal with prejudice of such claims. S&P initially placed the ratings on CreditWatch with negative implications on Sept. 9, 2009, after the company announced that it would explore strategic alternatives, including a possible sale of the company in a "go private" transaction. On Nov. 3, 2009, Fertitta announced his initial offer to take the company private for $14.75 per share and on April 27, 2009, he raised the offer to $21 per share. The current offer values the entire company around $1.4 billion, and S&P estimates the total transaction value around 7.6x companywide last-12-month EBITDA. "The speculative-grade rating on Landry's reflects the highly competitive nature of the restaurant industry, its vulnerability to weak consumer spending, and a highly leveraged capital structure that results in weak cash flow protection measures," said Standard & Poor's credit analyst Charles Pinson-Rose. If the offer is approved, total cash considerations to shareholders should amount to approximately $175 million. Currently, S&P believes that Fertitta and the company would need a modest amount of additional capital to fund a going private transaction at the $24 share price. However, the company's available liquidity sources may be able to fund the transaction, especially considering the company's highest cash flow comes during the upcoming summer months. The company's credit agreement and bond indentures have limitations on its ability to raise additional debt, but additional cash equity could come from Ferttita. "If Fertitta's revised proposal gains the necessary approvals and the current capital structure is unchanged, S&P may affirm its 'B' corporate credit rating and remove the ratings from CreditWatch with negative implications," added Mr. Pinson-Rose. If the company altered its capital structure or issued additional debt, S&P would assess the potential financial risk and take the appropriate action, which could entail a downgrade. If there is no going private transaction and the capital structure is unchanged, S&P could still affirm its ratings as long as S&P were comfortable with management's financial policies and business strategies. LARRY SPANN: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Larry D. Spann 6358 West 500 North Madison, IN 47250 Bankruptcy Case No.: 10-91619 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Southern District of Indiana (New Albany) Judge: Basil H. Lorch III Debtor's Counsel: Jeffrey M. Hester, Esq. Tucker Hester, LLC 429 N Pennsylvania Street, Suite 100 Indianapolis, IN 46204-1816 Tel: (317) 833-3030 Fax: (317) 833-3031 E-mail: jeff@tucker-hester.com Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,001 to $50,000,000 According to the schedules, the Debtor says that assets total $9,050 while debts total $19,638,432. A copy of the Debtor's list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/insb10-91619.pdf The petition was signed by the Debtor. L.A.J. INC.: Case Summary & 11 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: L.A.J. Inc., of Delaware P.O. Box 5378 Bossier City, LA 71171 Bankruptcy Case No.: 10-11464 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Western District of Louisiana (Shreveport) Debtor's Counsel: Robert W. Raley, Esq. 290 Benton Road Spur Bossier City, LA 71111 Tel: (318) 747-2230 Fax: (318) 747-0106 E-mail: rraley52@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of 11 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/lawb10-11464.pdf The petition was signed by Pat Lindsey. LYONDELL CHEMICAL: Professionals Takes Home $50M for Work --------------------------------------------------------- Bankruptcy Law360 reports that the professionals who worked on the bankruptcy of Lyondell Chemical Co., which emerged from Chapter 11 a few weeks ago, will take home more than $50 million in fees and expenses for the last four months of 2009, including about $21 million for debtors' counsel Cadwalader Wickersham & Taft LLP. 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) MACH GEN: S&P Affirms 'BB-' Rating on $100 Mil. Facility -------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'BB-' rating on U.S. electricity generator MACH Gen LLC's $100 million first-lien revolving working capital facility due February 2012 ($45 million outstanding at unaudited Dec. 31, 2009, up from $20 million at Dec. 31, 2008 and $35 million at Dec. 31, 2007), and $60 million first-lien synthetic letter of credit facility due February 2013 ($54 million of letters of credit issued at Dec. 31, 2009, up from $42.4 million at Dec. 31, 2008) and revised the outlook to stable from positive. The '1' recovery rating on the first-lien senior secured debt obligations reflects S&P's expectation of very high (90%-100%) recovery of principal in the event of a default. The rating reflects a significant decrease in first-lien leverage following repayment of the first-lien term loan in late 2008, tempered by steadily increasing second-lien payment-in-kind debt (not rated). "The change in outlook is a result of the project cash collateralizing its first-lien synthetic letter of credit facility at a slower rate than S&P anticipated after the project repaid the first-lien term loan," said Standard & Poor's credit analyst Matthew Hobby. During 2009, the project cash collateralized $1.2 million of the $60 million first-lien synthetic letter of credit facility. Coverage of first-lien interest obligations nonetheless remained solid in 2009 at 2.49x, calculated according to debt covenants. First-lien debt service requirements will likely decrease significantly in 2010 because the project's first-lien swaps remained outstanding until December 2009, consisting mostly of 2009 first-lien debt service. The project's $580 million senior secured first-lien term loan B due February 2014 was fully amortized on Dec. 11, 2008 after the project sold the Covert combined-cycle gas turbine facility in South Haven, Mich. to Tenaska Capital. However, because first- lien facilities remain outstanding, the project's $838.9 million second-lien term loan C due February 2015 continues to pay- in?kind, with no mandatory interest or amortization, accreting to $1.133 billion at Dec. 31, 2009, up from $1.042 billion at Dec. 31, 2008 and $936.5 million at Dec. 31, 2007. The stable outlook reflects the low first-lien leverage and resulting solid first-lien covenant interest coverage of 2.49x in 2009. S&P expects first-lien coverage to remain solid under the 2010 budget. The primary risk to the rating is the project's exposure to merchant power markets caused by its lack of long-term power hedges. Future variations in merchant revenue that caused low interest coverage could result in a lower rating. Although the PIK debt has no remedies while the first-lien debt remains outstanding, the full effects of the steadily increasing second- lien PIK debt remain uncertain. MALDEN BROOK: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Malden Brook Farms LLC 29 Prospect Street West Boylston, MA 01583 Tel: (508) 835-6258 Bankruptcy Case No.: 10-42617 Chapter 11 Petition Date: May 24, 2010 Court: United States Bankruptcy Court District of Massachusetts (Worcester) Judge: Melvin S. Hoffman Debtor's Counsel: Roy W. Pastor, Esq. Lorden, Pastor & Lilly, P.C. 270 Ayer Road P.O. Box 335 Harvard, MA 01451 Tel: (978) 772-0011 Fax: (978) 772-9902 E-mail: attorney@lorden-pastor.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Robert J. Tesujian, managing partner. MARY BEESON: Case Summary & 4 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Mary Anne Goldsmith Beeson 2150 River Road Piedmont, SC 29673 Bankruptcy Case No.: 10-03678 Chapter 11 Petition Date: May 23, 2010 Court: United States Bankruptcy Court District of South Carolina (Spartanburg) Judge: Helen E. Burris Debtor's Counsel: Nancy E. Johnson, Esq. Law Office of Nancy E. Johnson, LLC 2201 Greene Street Columbia, SC 29205 Tel: (803) 343-3424 Fax: (803) 656-0510 E-mail: nej@njohnson-bankruptcy.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's list of 4 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/scb10-03678.pdf The petition was signed by the Debtor. MEDAFOR INC: CryoLife Sends Letter to Firm's Shareholders --------------------------------------------------------- CryoLife, Inc. has sent a letter to Medafor shareholders. Dear Fellow Medafor Shareholder: You should have recently received a proxy statement from Medafor asking you to re-elect the five incumbent members of their board of directors. As Medafor's largest shareholder, we are deeply concerned by both Medafor's rush to hold their annual shareholders' meeting and by the troubling information disclosed in their proxy statement and recently issued financial statements and letters to shareholders. We are writing to urge you to WITHHOLD your support for directors Michael Pasquale, Paul Gray, Robert Halverson, Gary Shope and Gerald Van Eeckhout given their poor oversight of Medafor. Do NOT return your proxy to management. If you have already given management your proxy, revoke it by writing Medafor. If you can, attend the meeting in person. Medafor's Directors Enriching Themselves At The Expense Of Shareholders Medafor's management and board have continually diluted shareholders, issuing new shares to finance the company without receiving adequate value in return. Their proxy statement and financial statements provide further evidence of this fact. Specifically, the proxy discloses several instances during 2009 where stock, warrants and options were issued to employees, contractors, distributors and others at prices inconsistent with Medafor's statements about the value of Medafor shares. In 2009, Medafor's board granted shares to themselves that they valued at only $1.50 per share. In the fourth quarter of 2009, Medafor issued options to management with an exercise price of $2.00 per share. This means that at the end of 2009, the Medafor board concluded that $2.00 per share was "fair market value," as is required under the stock incentive plan that Medafor shareholders approved. Despite this, just two months later, Medafor urged its shareholders not to sell their shares to CryoLife because, in Gary Shope's words, $2.00 per share was not "even close to a fair price" and was "grossly inadequate." Apparently, $2.00 per share is unconscionably low when Medafor shareholders want to sell their shares, but it's fair enough when Medafor's insiders are compensating themselves. One thing is certain, either the Medafor board and management have been enriching themselves at the shareholders' expense by undervaluing their equity and option awards, or their statements regarding the adequacy of CryoLife's $2.00 per share offer were not made in good faith. Also raising a concern is the fact that, in its proxy statement, Medafor implied that the shares issued to Magle in conjunction with the technology transfer transaction were issued at an average price of $5.28 per Medafor share. This valuation raises questions as to why Medafor routinely granted stock, options and warrants that were priced considerably below $5.28 per share in the months leading up to the consummation of the Magle transaction. Have Medafor's board and management unjustly, and potentially illegally, enriched themselves and key partners at the expense of other shareholders by granting stock and options at prices considerably below market value or have they not been candid in their statements to Medafor shareholders regarding the Magle transaction and its impact on Medafor and its shareholders? The proxy also indicates that Medafor has entered into severance and change in control agreements with its CEO and CFO, providing the current management with golden parachutes that could deter potential buyers. These agreements are in addition to the excessive compensation earned by key executives. For instance, in addition to stock awards and stock option grants, Medafor's CEO and CFO earned a combined $700,000 in cash in 2009 while delivering questionable financial performance and significant shareholder dilution. The amount of cash taken out of the business by the CEO and CFO for their compensation represents over 70 percent of Medafor's available cash at the end of 2009. These are compensation levels that public company executives would be pleased to receive. They are not appropriate for a private company at Medafor's stage of development with limited cash. Medafor's Limited Financial Disclosures Raise New Concerns We do not believe that Medafor has sufficient capital to invest adequately in its business in order to protect its technology from competition or to maximize its commercial potential. Medafor has disclosed in its financial statements that it must repay $3.2 million in convertible notes in 2011 and that it is currently in default of the covenants of its $1.0 million credit facility that expires in November 2010, but it has not provided shareholders with any clarity as to how it plans to fund the $3.2 million in convertible note payments. Furthermore, the Medafor board continues to withhold information that is required in order to accurately assess the company's current financial condition and performance. In fact, Medafor has failed to provide any financial statements for the first quarter of 2010. In addition, Medafor's directors entered into a highly unusual and material contract with Magle, involving substantial dilution to shareholders and a significant cash outlay, while concealing the information that would be necessary to allow an accurate assessment of Medafor's current financial condition following the transaction. Despite our repeated requests, Medafor has refused to allow us to see the contract with Magle, or their accounting records related to this transaction, including what value Medafor ascribed to the technology. They have also failed to provide key balance sheet data, shareholders' equity information, or detail on the company's cash position, as they have in the past, which would allow shareholders to gauge the impact of the transaction. Additionally, Medafor has trumpeted some improvement in earnings for the first quarter of 2010, without noting the impact on earnings per share of the Magle transaction. This lack of disclosure suggests that Medafor's board has significantly impaired the value of Medafor shares and is hiding it from shareholders. Curtailing Shareholder Rights Medafor's directors have unexpectedly scheduled their annual shareholders' meeting just seven months since the last meeting and have given shareholders barely three weeks' notice of this surprising meeting. This timing appears designed to prevent shareholders from being able to meaningfully evaluate the performance of Medafor and its board, nominate an alternative slate of directors, put forth shareholder proposals or otherwise participate fully in the meeting. In addition to attempting to prevent shareholder action at the meeting, the timing leads us to believe that Medafor's directors are anxious to ensure their re- election before shareholders have any possibility of discovering the impact that the Magle transaction has had on the company's condition and the value of their shares. Medafor has also been actively attempting to curtail the shareholder rights granted in its bylaws by attempting to keep shareholders from being able to call their own meetings. They are working in court to take away the right guaranteed certain Medafor shareholders to call a special meeting at any time for any purpose. Additionally, Medafor is attempting to deny shareholders access to records of board proceedings in order to conceal information from shareholders about the board's activities and the current financial condition of the company. Medafor has also stated that it has granted Magle the right to terminate its exclusive supply agreement with Medafor in the event that Medafor is acquired without board approval, regardless of whether a majority of shareholders think the transaction is fair. Medafor's Directors Are Destroying Shareholder Value And Limiting Shareholder Rights Medafor's board of directors has overseen the destruction of Medafor's business, its technology, and the value of its shares. Please join CryoLife in sending a message to Medafor's board that they must provide shareholders with up-to-date, complete information about the current condition of the company, especially the recent Magle transaction, and that they must respect our fundamental rights as shareholders to participate in director elections. Do NOT return your proxy to management -- this communicates you are WITHHOLDING your vote. If you have already voted, you can rescind your proxy by writing to Medafor at 2700 Freeway Blvd., #800, Minneapolis, MN 55430-1757 and stating "I hereby revoke the proxy that I previously provided to you in connection with the annual shareholders' meeting to be held on June 10, 2010." Your revocation should be dated and signed, using your exact name as it appears on your Medafor shares. EVEN IF YOU HAVE RETURNED YOUR PROXY TO WITHHOLD YOUR VOTES FOR THE MEDAFOR BOARD, IT IS IMPORTANT THAT YOU RESCIND IT, IN ORDER TO AVOID GIVING MEDAFOR MANAGEMENT DISCRETIONARY AUTHORITY TO VOTE WITH RESPECT TO ANY OTHER PROPOSALS THEY MAY BRING AT THE MEETING WITHOUT HAVING GIVEN YOU PROPER NOTICE. If you can, we also encourage you to attend the meeting and voice your discontent in person. By NOT returning your proxy to management, thereby withholding your vote for Medafor board of director nominees, you will be sending a clear message to the Medafor management and board that its actions are unacceptable! If you have any questions, please do not hesitate to contact Nina Devlin at 212-704-8145. Sincerely, Steven G. Anderson Founder, CEO and President About CryoLife, Inc. Founded in 1984, CryoLife, Inc. is a leader in the processing and distribution of implantable living human tissues for use in cardiac and vascular surgeries throughout the U.S. and Canada. MESA AIR: Judge Delays Breakup of Delta Service Contract -------------------------------------------------------- Bankruptcy Law360 reports that a judge has allowed Mesa Air Group Inc. to continue acting as a regional carrier for Delta Air Lines Inc. on a temporary basis while it considers appealing a ruling in a contract dispute that allowed Delta to dump Mesa for failing to maintain a service benchmark. Judge Martin Glenn issued a ruling in a brief hearing on Monday in the U.S. Bankruptcy Court for the Southern District of New York giving his blessing to the deal, according to Law360. About Delta Air Lines 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. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MICHAEL FOODS: Moody's Reviews 'B1' Corporate Family Rating ----------------------------------------------------------- Moody's placed the B1 CFR and other ratings of Michael Foods, Inc., on review for possible downgrade following the announcement Friday that its parent, M-Foods Holdings, Inc., has entered into an agreement to be bought in a leveraged transaction by affiliates of Goldman Sachs Capital Partners. The transaction is valued at approximately $1.7 billion and will materially increase the total leverage of the company. The transaction is subject to certain conditions, including provisions of Hart-Scott-Rodino, the repayment of indebtedness outstanding under the company's Amended and Restated Credit Agreement (dated May 1, 2009) and the successful tender of at least 50.1% of the 9.75% notes at Holdings and the 8% senior subordinated notes at Michael Foods, both due 2013. While certain of the current obligations will be repaid if the transaction goes through as planned, and these instrument ratings may ultimately be withdrawn, the review will focus on the likely weakening of credit protection measures going forward, which could put pressure on the corporate family and corporate default ratings as well as ratings on any debt not tendered. Moody's said that the given recent solid performance of the company, any downgrade of the CFR would not likely exceed one notch. These ratings were placed on review for possible downgrade: Michael Foods, Inc. * $75 million 3.5 year 1st lien revolving credit agreement at Ba3 (LGD3, 34%) * $450 million senior secured Term Loans (A and B tranches) at Ba3 (LGD3, 34%) * $150 million 8% subordinated notes due November 2013 at B3 (LGD5; 78%) M-Foods Holdings, Inc. (holding company) * Corporate family rating at B1 * Probability of default rating at B1 * 9.75% senior discount notes due 2013 at B3 (LGD6; 92%) The most recent rating action for this issuer was in April 2009 when Moody's assigned ratings to the company's new bank facilities and changed the outlook to positive. Headquartered in Minnetonka, Minnesota, Michael Foods, Inc., is a producer and distributor of egg products, cheese and other refrigerated grocery products and potato products. Annual sales exceed $1.5 billion. The company is currently 89.8% owned by private equity firm Thomas H. Lee Partners L.P. and affiliates. MICHAEL FOODS: S&P Puts 'B+' Rating on CreditWatch Negative ----------------------------------------------------------- Standard & Poor's Ratings Services said that it placed its ratings, including the 'B+' corporate credit rating, on Minnetonka, Minn.-based Michael Foods Inc. on CreditWatch with negative implications, which means that the ratings could be lowered or affirmed upon completion of S&P's review. This action follows the company's May 21, 2010, announcement that its parent, M-Foods Holdings Inc., has signed a definitive agreement to be acquired by GS Capital Partners. Under the terms of the proposed sale, Thomas H. Lee Partners (the current financial sponsor) will retain a 20% ownership stake in the business. The transaction values the company at approximately $1.7 billion, and is expected to close within the next two months. "Although the company's credit protection measures have improved over the past five years due to improved operating performance and reduced debt, S&P believes this leveraged buyout transaction could weaken Michael Foods' credit profile because of the likelihood for it to be funded with additional debt," said Standard & Poor's credit analyst Mark Salierno. Specific financing details have not yet been disclosed. S&P will resolve the CreditWatch when more information regarding how the transaction will be financed becomes available and S&P can assess the company's business strategy, financial policy, and the impact that the proposed acquisition will have on the company's capital structure. MONDRIAN TTL: Section 341(a) Meeting Scheduled for June 8 --------------------------------------------------------- The U.S. Trustee for Region 14 will convene a meeting of Mondrian TTL, L.L.C.'s creditors on June 8, 2010, at 12:30 p.m. The meeting will be held at the U.S. Trustee Meeting Room, 230 N. First Avenue, Suite 102, Phoenix, AZ. This is the first meeting of creditors required under Section 341(a) of the U.S. 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. Phoenix, Arizona-based Mondrian TTL, L.L.C., dba Mondrian Tempe Town Lake, filed for Chapter 11 bankruptcy protection on May 9, 2010 (Bankr. D. Ariz. Case No. 10-14140). Susan M. Freeman, Esq., at Lewis and Roca, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50,000,001 to $100,000,000. MPM TECHNOLOGIES: Posts $386,000 Net Loss for March 31 Quarter -------------------------------------------------------------- MPM Technologies Inc. filed its quarterly report on Form 10-Q, showing a net loss of $386,398 on $129,576 of total revenues for the three months ended March 31, 2010, compared with a net loss of $362,522 on $184,073 of total revenues during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $1.2 million in total assets and $14.9 million in total current liabilities, for a $13.6 million total stockholders' deficit. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?633c As reported by the TCR on May 10, 2010, MPM Technologies Inc. said that on May 3, its wholly owned subsidiary MPM Mining Inc. had entered into a joint venture agreement with Forbes Financial Group to develop the Company's mining properties. The agreement stipulates that MPM Mining will supply all mining data, claims, assay results, geophysical data and equipment to the venture. Forbes Financial Group will provide no less than $5,000,000 of initial financing to the joint venture to commence operations. About MPM Technologies Headquartered in Parsippany, N.J., MPM Technologies Inc. (OTC BB: MPML) -- http://www.mpmtech.com/-- operates through its three wholly owned subsidiaries: AirPol Inc., NuPower Inc. and MPM Mining Inc. During the year ended Dec. 31, 2007, AirPol was the only revenue generating entity. AirPol operates in the air pollution control industry. It sells air pollution control systems to companies in the United States and worldwide. The company through its wholly owned subsidiary NuPower is engaged in the development and commercialization of a waste-to-energy process known as Skygas. These efforts are through NuPower's participation in NuPower Partnership, in which MPM has a 58.21% partnership interest. NuPower Partnership owns 85% of the Skygas Venture. In addition to its partnership interest through NuPower Inc., MPM also owns 15% of the Venture. MSGI SECURITY: Posts $4.3 Million Net Loss for March 31 Quarter --------------------------------------------------------------- MSGI Security Solutions Inc. filed its quarterly report Form 10-Q, showing $4.3 million net loss on $0 total revenue for the three months ended March 31, 2010, compared with $1.5 million net loss on $141,000 of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2010, showed $2.1 million in total assets and $20.3 million in liabilities, for a stockholders' deficit of $18.2 million. The Company did not file its Form 10-Q on time. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?633d 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. 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. NEFF CORP: Seeks to Retain Deloitte Tax as Tax Advisor ------------------------------------------------------ BankruptcyData.com reports that Neff Corp. filed with the U.S. Bankruptcy Court motions seeking to retain Deloitte Tax (Contact: Jeffrey P. Van Gelder) as tax advisor at these hourly rates: * partner, principal or director at $581 to 985, * senior manager at 500 to 775, * manager at 430 to 675, * senior at 336 to 540 and * staff at 242 to 395, Neff Corp. also seeks to hire Deloitte & Touche (Contact: Jonathan C. Berger) as independent auditor at these hourly rates: * partner, principal or director at $470 to 640, * senior manager at $390 to $495, * manager at $350 to $425, * senior at $260 to $330 and * staff at $190 to $260. The Debtor also seeks to hire Hilco Real Estate (Contact: Joseph A. Malfitano) as real estate advisor for these fees (Hilco may be compensated for only one of these fee types, with the exception that a non-economic flat fee may be earned in conjunction with any of the other fees): restructured lease savings fee, renewal lease savings fee, terminated lease savings fee, assignment/subleased savings fee and non-economic flat fee. About Neff Corp. Privately held Neff Corp., doing business as Neff Rental, provides construction companies, golf course developers, industrial plants, the oil industry, and governments with reliable and quality equipment that is delivered on time where it is needed. With more than 1,000 employees operating from branches coast to coast, Neff Rental is ranked by Rental Equipment Register (RER) magazine as one of the nation's 10 largest equipment rental companies. Neff Corp. and its units, including Neff Rental Inc. filed for Chapter 11 on May 17, 2010 (Bankr. S.D.N.Y. Case No. 10-12610). Based in Miami, Neff has assets of $299 million and debt of $609 million, according to the disclosure statement explaining the plan. Funded debt totals $580 million. Revenue in 2009 was $192 million. NEW DEVELOPMENT: Moody's Assigns 'Ba3' Rating on $1.4 Bi. Notes --------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to New Development Holdings, LLC's $1.4 billion of senior secured first lien bank facilities, being offered as a $1.3 billion senior secured term loan and a $100 million senior secured revolver. Proceeds from the term loan will be used by parent Calpine Corporation (B1 Corporate Family Rating, stable) to help fund the approximate $1.65 billion acquisition of 4,490 megawatts generation assets owned by Connectiv Energy Holding Company (to be renamed Calpine Mid-Atlantic Energy). The rating outlook for NDH is stable. The Ba3 senior secured NDH rating reflects the significant interrelationship between Calpine and wholly-owned NDH, Calpine Mid-Atlantic Energy and its subsidiaries as Moody's calculate that around 80% of NDH's future operating revenues will be provided by capacity payments from Calpine Energy Services to subsidiaries of CMAE under 18 tolling arrangements to be effective at acquisition close and mature no later than December 31, 2019. These payments along with capacity payments from a separate tolling arrangement between Constellation Energy Commodities Group, Inc. and Calpine Mid-Merit LLC (Delta project), effective from June 1, 2011, through May 31, 2017, provide a very high degree of steady, predictable cash flow over the life of the debt. Calpine guarantees CES' payments under its tolls and Constellation Energy Group, Inc. (Baa3 senior unsecured, stable) guarantees CECG payments under the Delta project toll. Such cash flows when combined with a cash sweep mechanism in the term loan are expected to result in substantial principal repayments over the seven year tenor of the term loan. The rating also factors in the existence of monthly capacity payments paid by PJM Interconnection LLC (Aa3 senior unsecured, stable) to Calpine Mid-Atlantic Marketing, a CMAE subsidiary, from the Reliability Pricing Model capacity auctions which provide a high quality and predictable source of cash flow for CMAE and its subsidiaries. Over the next three years, Moody's calculate that RPM capacity payments and payments received under the Delta toll will represent at least 66% of the total capacity payments expected to be paid by CES to CMAE and its subsidiaries. Moody's also calculates that based on the results of the May 14, 2010, RPM capacity auction, CMAE and its subsidiaries will receive approximately $150 million of incremental capacity payments during the June 2013 -- May 2014 period relative to the same 2012/2013 period. While RPM auction results can be volatile on a year-to- year basis, Moody's believes that the CMAE generation assets will continue to be recipients of relatively healthy capacity payments given the transmission constrained regions that these assets operate and the prospect that several thousand MWs of old, small, less efficient coal-fired generation in PJM may permanently shut down over the intermediate term. From a flow of funds perspective, Moody's understand that PJM will pay monthly RPM capacity payments to CMAM and that CES will act as the authorized representative for the receipt of the CMAM funds. CMAM will subsequently pass on the RPM capacity payments to CES during the tenor of the CES tolls. Importantly, in the event that CES were to default under any of its tolling obligations with subsidiaries of CMAE, CMAM has the right to stop passing the RPM capacity payment to CES related to the toll or tolls that may be in default. Based on the outcome of the RPM capacity auctions through May 2014 and the existence of the Delta toll with CECG, in the unlikely event that CES were to default on all of its tolling obligations with CMAE subsidiaries, Moody's calculates that NDH would still be able to generate modest amounts of positive free cash flow over this period. The rating further acknowledges that the financing structure features a 50% excess cash flow sweep which should facilitate a fairly rapid principal reduction over the tenor of the term loan. Moody's calculate that at maturity in 2017, the issuer's debt will be reduced by nearly 50% from the original $1.3 billion with the expected refinancing amount representing debt/ kW of less than $200 / kW when considering all of CMAE's generation assets, and debt / kW of less than $250 / kW when considering only the newest generation assets (approximately 3,023 MW). Moody's believe that this level of remaining refinancing risk appears manageable, particularly when one considers the locational value of the assets. Through various subsidiaries, Calpine is responsible for the maintenance, operation, and the delivery of fuel to the CMAE plants through bilateral agreements, all of which are guaranteed by Calpine. Additionally, one of Calpine's subsidiaries, Calpine Construction Management Company, Inc., will provide construction management services for the Delta project, which is expected to be completed by June 2011. Approximately $65 million of proceeds from the secured term loan will be used to fund the remaining construction costs of this project. Moody's observes that the projected standalone credit metrics appropriately position the NDH subsidiary within the "Ba" rating category, based upon Moody's financial metric ranges outlined in the Rating Methodology: Unregulated Utilities and Power Companies, published in August 2009. Specifically, cash flow (CFO pre-W/C) to debt, retained cash flow to debt, and free cash flow to debt is expected to average 15%, 9%, and 6%, respectively from 2011 through 2013, while cash flow coverage of interest expense is expected to average more than 3.0x over the same next three year period. Notwithstanding these standalone metrics and the existence of non-Calpine related sources of cash flow, Moody's believes that the rating on NDH's senior secured debt will remain closely aligned with Calpine's B1 Corporate Family Rating given the degree of interdependence that exists with the parent. Moreover, any rating change at Calpine would likely result in a similar rating action for NDH. Calpine's B1 CFR incorporates the continued improvement in financial metrics since the company's February 2008 emergence from bankruptcy, and the likelihood of a strengthened financial performance in the future based upon the incremental earnings and cash flow contributions from the CMAE assets along with the expected incremental contribution from new projects and new contracts with a number of end-use customers. The rating considers the company's hedging program, a favorable environmental profile, the diversification and newness of the Calpine generation fleet, and an expectation for continued strong operating performance. For more information on Calpine, please refer to the May 5th press release and the most recent Credit Opinion, both of which can be found on moodys.com. Regarding the acquisition, Calpine will not acquire Connectiv's trading book, collateral requirements or load-serving auction obligations, and Calpine will not assume any off-site environmental liabilities or pre-close pension and retirement welfare liabilities. Including closing costs and other related expenditures, total consideration to complete the acquisition is expected to be $1.84 billion which will be funded by the NDH $1.3 billion secured term loan and $540 million of corporate cash. Calpine has entered an agreement to sell its Rocky Mountain and Blue Spruce generation plants to Public Service Company of Colorado for $739 million, which should close at year-end 2010. Net proceeds for Calpine from this transaction are expected to approximate $400 million after the repayment of subsidiary level debt which will release about $90 million in restricted cash. The term loan will mature in seven years from closing while the revolver will mature in three years. Both the term loan and revolver will be secured on a first lien basis by most of the assets owned by CMAE, which includes eighteen generating plants aggregating 3,860 MW located in Delaware, Pennsylvania, New Jersey, Maryland and Virginia, as well as the contracts entered into by CMAE and its subsidiaries, including CMAM. Moody's observes that the Delta project, a 565 MW natural gas-fired project under construction, and the related CECG tolling obligation are not included in the collateral package due to restrictions under the toll. Upon the May 31, 2017 expiry of this toll, the Delta project will be included in the collateral package. All obligations of NDH under the facilities and any obligations under any interest rate protection arrangements will be unconditionally guaranteed by each existing and subsequently acquired domestic wholly owned subsidiaries of NDH (Subsidiary Guarantors). The facilities, the guarantees and any interest rate protection agreements will be secured by substantially all the assets of NDH and each Subsidiary Guarantor, with certain exceptions, with the above referenced Delta project being the only meaningful exception. The term loan and revolver will have a maximum leverage ratio and a minimum interest coverage ratio. Given the expected predictability in the issuer's cash flow, Moody's believe NDH should be able to maintain ample head room under these covenants. In light of NDH's dependence on Calpine and its affiliates for revenues, O & M support and construction services, NDH's stable rating outlook mirrors that of Calpine's. The stable rating outlook for Calpine reflects Moody's expectation for execution of the company's strategy through strong plant performance and a carefully implemented hedging strategy which is expected to result in free cash flow generation helping to facilitate continued consolidated debt reduction. While limited prospects exist for the Calpine or NDH rating to be upgraded in the near-term, Calpine's CFR could be upgraded if Calpine's ratio of free cash flow to debt reaches the high single digits, if Calpine's cash flow to debt exceeds 12%, and if the company's coverage of interest expense is above 2.3x on a sustainable basis. Calpine's rating could be downgraded if the company does not to execute on its business plan resulting in the company's cash flow to debt declining below 7%, and its cash coverage of interest expense falling below 1.8x for an extended period. Moody's last rating action on Calpine occurred on May 5, 2010, when the ratings were upgraded, including the company's CFR to B1 from B2. This is the first time that Moody's is assigning a rating to NDH. The ratings for NDH's bank loan were determined using Moody's Loss Given Default methodology. Based upon Calpine's B1 CFR and PDR, the LGD methodology suggests a B1 for NDH's senior secured revolver and term loan. The Ba3 rating incorporates the substantial collateral coverage of NDH debt over the life of the loan given the existence of the excess cash flow sweep, the fact that a majority of the contracted cash flows are ultimately sourced by payments from non-Calpine, investment-grade rated entities, and the fact that cash flows from the RPM auction can stay at CMAE and its subsidiaries in the event that CES defaults on its tolling obligations. Assignments: Issuer: New Development Holdings, LLC -- Senior Secured Bank Credit Facility, Assigned Ba3, LGD3 42% -- Senior Secured Bank Credit Facility, Assigned Ba3, LGD3 42% Headquartered in Houston, Texas, Calpine is a major U.S. independent power company with assets of $16.65 billion at December 31, 2009. Upon closing the CMAE acquisition, Calpine will have aggregate generating capacity of 28,297 MW. NDH wholly owns CMAE, which will have a mid-merit focused business with 4,490 MW of generation assets in eastern PJM, 3,860 MW in operation across 18 power plants in four states and one 565 MW CCGT plant under construction in Pennsylvania. Moody's understand that the transaction has received Hart-Scott-Rodino approval and Moody's understand that the acquisition is targeted to close on or around June 30, 2010. NEW DEVELOPMENT: S&P Assigns 'BB-' Rating on $1.4 Bil. Loan ----------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its 'BB-' preliminary rating to the proposed $1.4 billion first-lien senior secured facilities at New Development Holdings LLC and assigned a recovery rating of '1' to the facilities, indicating S&P's expectation for very high (90%-100%) recovery in the event of a payment default. The facilities consist of a $1.3 billion term loan and a $100 million revolving credit/letter of credit facility. "The rating reflects the fully contracted nature of cash flows for the life of the debt and strong coverage ratios, but is limited by counterparty exposure to Calpine Corp.," said Standard & Poor's credit analyst Swami Venkataraman. The proceeds of the term loan, along with $540 million in corporate cash, will finance the acquisition of sponsor Calpine Corp. of Conectiv Energy, to be renamed Calpine Mid-Atlantic Energy LLC, from Pepco Holdings for $1.65 billion plus adjustments for working capital and fuel inventory and to finance the remaining construction costs (about $65 million) of the 545- megawatt Delta combined-cycle gas plant. The transaction is expected to close on July 1, 2010. CMAE is a mid-merit focused business with 4,490 MW of generation strategically concentrated in Eastern PJM. NDH is a special-purpose, intermediate holding company that is 100% owned by Calpine and that owns 100% of CMAE. The stable outlook reflects the fully contracted nature of the project's revenues as well as Calpine's strong reputation as an operator of gas-fired power plants. Movement of the project rating is essentially tied to movement on the Calpine rating given the pervasive operational, financial, and ownership linkages. NEW LEAF: Posts $2.7 Million Net Loss for March 31 Quarter ----------------------------------------------------------- New Leaf Brands, Inc., filed its quarterly report Form 10-Q, showing a $2.7 million net loss on $954,549 of total revenues for the three months ended March 31, 2010, compared with a $1.9 million net loss on $701,789 of total revenues during the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $6.6 million in total assets and $6.1 million in total liabilities, for a $521,333 million total stockholders' equity. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?632a Scottsdale, Ariz.-based New Leaf Brands, Inc. develops, markets and distributes healthy and functional ready-to-drink teas under the New Leaf(R) brand. * * * According to the Troubled Company Reporter on April 8, 2010, Mayer Hoffman McCann P.C., in Phoenix, Ariz., 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, has a working capital deficiency, was not in compliance with certain financial covenants related to debt agreements, and has a significant amount of debt maturing in 2010. The Company's balance sheet as of December 31, 2009, showed $6.8 million in assets, $5.1 million of debts, and $1.7 million of stockholders' equity. NORD RESOURCES: Posts $1 Million Net Income for March 31 Quarter ---------------------------------------------------------------- Nord Resources Corporation filed its quarterly report on Form 10- Q, showing a $1.0 million net income on $6.0 million of net sales for the three months ended March 31, 2010, compared with a $655,324 net income on $1.4 million of net sales for the same period a year ago. The Company's balance sheet at March 31, 2010, showed $67.0 million in total assets and $56.7 million in total liabilities, for a $10.2 million total stockholders' equity. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?633e About Nord Resources Based in Tuczon, Arizona, Nord Resources Corporation (TSX:NRD/OTCBB:NRDS.OB) -- http://www.nordresources.com/-- is a copper mining company whose primary asset is the Johnson Camp Mine, located approximately 65 miles east of Tucson, Arizona. Nord commenced mining new ore on February 1, 2009. * * * According to the Troubled Company Reporter on May 10, 2010, Nord Resources Corporation is facing a Thursday deadline to make payments under a copper hedge agreement and a credit facility with Nedbank Capital Limited. In March 2009, Nord agreed with Nedbank to amend and restate its credit agreement to provide for, among other things, the deferral of certain principal and interest payments until December 31, 2012, and March 31, 2013. While Nord made the scheduled principal and interest payments that were due on September 30 and December 31, 2009, in the approximate amounts of $2.3 million each, the Company was unable to make the scheduled principal and interest payment due on March 31, 2010, in the approximate amount of $2.2 million. Nord and Nedbank entered into an unconditional forbearance and extension agreement dated March 30, 2010, that allowed for a forbearance period of 21 days to negotiate an amendment to the credit agreement as it pertains to the March 31, 2010 payment and other terms therein. That agreement was then extended to May 13, 2010. NORTEL NETWORKS: Employment Pact With Head Strategist Approved -------------------------------------------------------------- Nortel Networks Inc. and its affiliated debtors obtained approval from the U.S. Bankruptcy Court of an employment agreement they entered into with George Riedel as chief strategy officer and president for business units of Nortel. Mr. Riedel has served as CSO of Nortel since February 2006, and was anticipated to leave the company on March 31, 2010. However, he was offered continued employment in light of the remaining work to be done in Nortel, including the completion of the sale of the Carrier VoIP and Application Solutions business. Under the Employment Agreement, Mr. Riedel's new position will be that of Chief Strategy Officer and President for Business Units. In this capacity, he will report directly to the Boards of Directors of Canada-based Nortel Networks Corp. and Nortel Networks Ltd., Ernst & Young Inc. and NNI's principal officer. Teams overseeing Nortel's CVAS business, Multi-Service Switch business and the LG-Nortel Co. Ltd. joint venture as well as the intellectual property team will report to Mr. Riedel. Pursuant to the Employment Agreement, Mr. Riedel will be paid a base salary of $600,000. As a participant in the Nortel Networks Ltd. Annual Incentive Plan, Mr. Riedel's annual AIP target award will be 100% of his base salary. Mr. Riedel will also be eligible to receive a special incentive payment of up to $3.47 million. Mr. Riedel's employment will terminate on January 1, 2011. It may be extended though upon agreement with NNI's principal officer and Ernst & Young. As part of the Riedel Employment Agreement, the Debtors also propose to entitle Mr. Riedel to an award under the Key Executive Incentive Plan upon achievement of the "third milestone," which refers to a confirmation by the Bankruptcy Court of NNI's plan of reorganization or a confirmation by the Ontario Superior Court of Justice of NNC's plan of restructuring or arrangement. 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 to Expand Hitachi IP Agreement -------------------------------------------------------- Nortel Networks Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice to amend their agreements with Hitachi Ltd. in a bid to expand the intellectual property rights licensed to Hitachi. The contracts include an intellectual property license agreement dated December 8, 2009, and a transition services agreement dated December 7, 2009. The agreements were inked in connection with the sale of Nortel's Next Generation Packet Core business to Hitachi. Hitachi, a Japanese multinational corporation, was selected as the winning bidder at an auction held in October 2009 for the sale of the Nortel Packet Core business. It offered to acquire the business for $10 million. Nortel proposed the amendment to allow Hitachi to sublicense some of its intellectual property to an unaffiliated third party. In return, Nortel will receive an additional licensing fee of $500,000 to be deposited in an escrow account. The proceeds in the escrow account will be held subject to allocation among the various Nortel units that may have a claim to the proceeds. Ernst & Young Inc., the firm appointed to monitor the assets of NNI's Canadian affiliates, expressed support for the approval of the proposed amendment. In its 46th monitor report, E&Y said the proposed amendment is appropriate and that the additional licensing fee is reasonable. A full-text copy of the Amended Hitachi Agreements is available for free at: http://bankrupt.com/misc/Nortel_AmendedAgreementsHitachi.pdf The Bankruptcy Court will consider approval of the proposed amendment at a May 24, 2010 hearing. 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: Seeks Canada Nod for Ericsson Share Purchase ------------------------------------------------------------- Nortel Networks Ltd. and its Canadian affiliates sought and obtained an order from the Ontario Superior Court of Justice approving a share purchase agreement with Telefonaktiebolaget LM Ericsson. The Share Purchase Agreement dated April 21, 2010, authorizes NNL to sell its shares in LG-Nortel Co. Ltd. to Sweden-based Ericsson. Ericsson agreed to pay NNL an amount in cash equal to a preliminary purchase price of $242 million, net of certain taxes, which will be subject to certain post-closing adjustments. NNL owns 118,001 shares of common stock and two shares of contingent voting preferred stock in LG-Nortel, a joint venture between NNL and LG Electronics Inc. in South Korea. In connection with the sale, NNL also obtained permission from the Canadian Court to execute a termination agreement with LG Electronics and Nortel Networks Korea Ltd. The Termination Agreement provides for a waiver by LG Electronics of certain rights it has under an August 17, 2005 joint venture agreement, which authorized the formation of LG-Nortel, to permit the transfer of the Nortel shares to Ericsson. It also authorizes either the termination or amendment of the JV Agreement. Ernst & Young Inc., the firm appointed to monitor the assets of NNL and its Canadian affiliates, expressed support for the approval of the Share Purchase Agreement and the Termination Agreement. In its 44th monitor report, E&Y said it believes the deal represents the best transaction available for the sale of NNL's shares. Full-text copies of the Share Purchase Agreement and the Termination Agreement are available for free at: http://bankrupt.com/misc/Nortel_SPAgreementLG.pdf http://bankrupt.com/misc/Nortel_TerminationAgreementLG.pdf The Share Purchase Agreement marks the sale of one of only a few remaining assets of Nortel. Still remaining are various Nortel patents and Nortel's Passport division, which provides non- optical equipment and was a portion of the Metro Ethernet Networks unit that was not sold to Ciena Corp. in a $521-million deal last year, according to a report by The Toronto Star. Nortel spokeswoman Jamie Moody said it is not yet clear what will happen to the remaining Nortel assets, which also include potential tax-loss recoveries that could be used by a profitable company, Toronto Star related. In an e-mail message, Ms. Moody said Nortel will assess other restructuring alternatives for its remaining businesses in the event it is unable to maximize value through sales, according to the report. 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: Seeks Canada Nod for Ogilvy to Release Escrow -------------------------------------------------------------- Nortel Networks Ltd. asks the Ontario Superior Court of Justice to direct Ogilvy Renault LLP to turn over about $1.9 million. Ogilvy serves as the escrow agent for the funds, which NNL put up in connection with a sublease it entered into with eBay CS Vancouver Inc. The parties' contract authorized eBay to lease from NNL a property located in Burnaby, British Columbia. Pursuant to an escrow agreement, eBay could use the escrow funds to pay the difference between the amounts NNL paid to the landlord and the amounts eBay paid to NNL under the sublease. The agreement provides for a release of the escrow funds to NNL upon confirmation to the escrow agent of eBay's termination of the sublease. NNL says the escrow funds no longer support any obligation between the parties after eBay repudiated its lease with the landlord and after eBay vacated the property. The landlord is not entitled to the escrow funds pursuant to the escrow agreement, NNL maintains. 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) NUTRA PHARMA: Posts $300,782 Net Loss for Q1 2010 ------------------------------------------------- Nutra Pharma Corp. filed its quarterly report on Form 10-Q, showing a net loss of $300,782 on $864,424 of revenue for the three months ended March 31, 2010, compared with a net loss of $320,913 on $18,230 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $1,222,045 in assets and $2,561,027 of liabilities, for a stockholders' deficit of $1,338,982. Kingery & Crouse P.A., in Tampa, Fla., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company has incurred significant losses from operations and has working capital and stockholder deficits. For the period ended March 31, 2010, the Company has an accumulated deficit of $26,873,625 and working capital and stockholders' deficits of $1,477,301 and $1,338,982, respectively. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6321 Coral Springs, Fla.-based Nutra Pharma Corp. is a biopharmaceutical company that engages in the acquisition, licensing and commercialization of pharmaceutical products and technologies as well as homeopathic and ethical drugs for the management of pain, neurological disorders, cancer, autoimmune and infectious diseases. OCEAN PARK: Section 341(a) Meeting Scheduled for June 8 ------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of Ocean Park Hotels - TOY LLC and Ocean Park Hotels - TOP, LLC's creditors on June 8, 2010, at 11:00 a.m. The meeting will be held at Room 105, 21051 Warner Center Lane, Woodland Hills, CA 91367. This is the first meeting of creditors required under Section 341(a) of the U.S. 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 Luis Obispo, California-based Ocean Park Hotels - TOY LLC -- tra Courtyard by Marriot-Thousand Oaks/Ventura; dba Marriott Courtyard, Courtyard-Thousand Oaks, and Marritott Courtyard- Thousand Oaks -- filed for Chapter 11 bankruptcy protection on May 6, 2010 (Bankr. C.D. Calif. Case No. 10-15358). Jeffrey N. Pomerantz, Esq., who has an office in Los Angeles, California, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. The Debtor's affiliate, Ocean Park Hotels -TOP, LLC (Case No. 10- 15359) filed a separate Chapter 11 petition on May 6, 2010. OK ETON: Case Summary & 10 Largest Unsecured Creditors ------------------------------------------------------ Debtor: OK Eton Square, LP 1750 Valley View, Suite 110 Dallas, TX 75234 Bankruptcy Case No.: 10-33583 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Barbara J. Houser Debtor's Counsel: Eric A. Liepins, Esq. Eric A. Liepins, P.C. 12770 Coit Road, Suite 1100 Dallas, TX 75251 Tel: (972) 991-5591 E-mail: eric@ealpc.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Ronald Akin, President of General Partner. Debtor's List of 10 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Peevy Construction -- $64,000 20 South 129th East Avenue Tulsa, OK 74108 Regis Property Mgmt -- $27,330 1800 Valley View Lane Dallas, TX 75234 Public Svc Co of Oklahoma -- $7,274 P.O. Box 24421 Canton, OH 44701-4421 Advance Security -- $1,081 Terry R Tucker Enterprises -- $1,025 Universal Roofing -- $768 Baker's Plumbing -- $225 Charles Pest Control -- $160 Ace Air Inc -- $70 Guardian Security Systems -- $12 OTTER TAIL: Posts $2.3 Million Net Loss in Q1 2010 -------------------------------------------------- Otter Tail Ag Enterprises, LLC, filed its quarterly report on Form 10-Q, showing a net loss of $2.3 million on $24.3 million of revenue for the three months ended March 31, 2010, compared with a net loss of $4.7 million on $22.7 million of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $106.9 million in assets, $89.6 million in liabilities, and $17.3 million of members' equity. On February 25, 2010, the Company filed a Chapter 11 plan of reorganization and disclosure statement. Under the plan, all equity interests will be cancelled. Unsecured creditors and rejected claims will be paid at least 12.5% of their claims and unsecured convenience claims will be paid in full. On April 8, 2010, the Company submitted a motion to extend its exclusive right to file a plan. This motion was denied at a hearing held on April 22, 2010. The Company's exclusivity period lapsed at the end of April. At a hearing held on May 12, 2010, the Bankruptcy Court failed to reach a decision regarding the Company's Chapter 11 Plan. The next hearing is currently set for May 26, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6336 Based in Fergus Falls, Minnesota, Otter Tail AG Enterprises, LLC -- http://www.ottertailethanol.com/-- owns and operates a nameplate capacity 55 million gallon annual production plant of undenatured ethanol in Fergus Falls, Minnesota. The Company processes approximately 20 million bushels of corn into approximately 55 million gallons of ethanol each year. In addition, the Company sells distillers grains, a principal co- product of the ethanol production process. The Company filed for Chapter 11 relief on Oct. 30, 2009 (Bankr. D. Minn. Case No. 09-61250). The petition listed assets of $66.4 million against $86 million in debt, nearly all secured. The largest secured creditor is AgStar Financial Services, owed $40.9 million. PACIFIC FUEL: Files for Chapter 7 Liquidation --------------------------------------------- BankruptcyData.com reports that Pacific Fuel Cell filed for Chapter 7 liquidation (Bankr. C.D. Calif. Case No. 10-16815). The Company is represented by R. Gibson Pagter, Jr. of Pager and Miller. The U.S. Trustee has scheduled a Juen 30 June 30, 2010, meeting of creditors under Sec. 341 of the Bankruptcy Code. Pacific Fuel manufactures bipolar plates, end plates and flow plates for fuel cells. PARADISE ESTATES: Case Summary & 4 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Paradise Estates, LLC 17695 Washington Street, #16 Dumfries, VA 22026 Bankruptcy Case No.: 10-14271 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Eastern District of Virginia (Alexandria) Judge: Robert G. Mayer Debtor's Counsel: Kevin M. O'Donnell, Esq. Henry & O'Donnell, P.C. 300 N. Washington Street, Suite 204 Alexandria, VA 22314 Tel: (703)548-2100 Fax: (703)548-2105 E-mail: kmo@henrylaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company says that assets total $4,024,983 while debts total $2,582,826. A copy of the Company's list of 4 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/vaeb10-14271.pdf The petition was signed by David L. Campbell, manager/owner. PEABODY ENERGY: Fitch Affirms Issuer Default Rating at 'BB+' ------------------------------------------------------------ Fitch Ratings has affirmed these ratings for Peabody Energy Corporation: -- Issuer Default Rating at 'BB+'; -- Senior unsecured notes at 'BB+'; -- Senior unsecured revolving credit and term loan at 'BB+'; -- Convertible junior subordinated debentures due 2066 at 'BB-'. The Outlook is Stable. Peabody Energy Corporation's credit ratings reflect large, well diversified operations, good control of low-cost production, strong liquidity and moderate leverage. Liquidity at quarter's end was strong, with cash on hand of $1 billion and availability under the company's revolver of $1.5 billion. Total debt with equity credit/EBITDA for the latest 12 months ended March 31, 2010, was 2.1 times. Peabody has substantial legacy liabilities and adjusted leverage was 3.1x for the year ended Dec. 31, 2009. Capital expenditures in 2010 are expected to be up to $650 million, excluding federal coal reserve lease payments, which are estimated at $25 million for 2010. Interest expense is expected to be between $205 million and $210 million for the year. Peabody is targeting 2010 EBITDA of at least $1.6 billion which Fitch believes should be attainable given the company's contract position and markets for its Australian coals. Fitch expects operating cash flows will cover capital expenditures and dividends of about $75 million per year amply over the next 12-18 months. Scheduled maturities of debt are $14.1 million in 2010, $505.2 million in 2011, $22.1 million in 2012, $689.5 million in 2013, and $21.5 million in 2014. Fitch expects Peabody to replace its revolver and term loan maturing in 2011 by the end of 2010. Peabody should remain well within its financial covenants of a maximum consolidated leverage ratio of 3.25x and a minimum interest coverage ratio of 2.50x. The Stable Outlook reflects Fitch's expectation that: -- Peabody will continue to invest in Australia to the extent of its free cash flow; -- Any significant leveraged acquisitions will be financed in a balanced manner with some cash on hand and/or equity; -- Total debt with equity credit/EBITDA will remain below 2.5x over the next 18 months. Fitch would consider a negative rating action if there were a substantial recapitalization or a significant debt financed acquisition. Peabody is the largest U.S. coal producer, fueling 10% of domestic electricity generation and the fifth largest coal producer in Australia. In 2009, Peabody sold 244 million tons of coal and had year-end reserves of 9 billion tons. PERRY YOUNG: Case Summary & 8 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Perry B. Young 4278 Muirwood Circle Reno, NV 89509 Bankruptcy Case No.: 10-51987 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court District of Nevada (Reno) Judge: Gregg W. Zive Debtor's Counsel: Kevin A. Darby, Esq. Darby Law Practice, Ltd. 4777 Caughlin Parkway Reno, NV 89519 Tel: (775) 322-1237 Fax: (775) 996-7290 E-mail: kevin@darbylawpractice.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's list of 8 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nvb10-51987.pdf The petition was signed by the Debtor. PHEASANT RUN: Unsecureds to Recover Claims in 4.5 Years ------------------------------------------------------- Pheasant Run Apartments, L.P., filed with the U.S. Bankruptcy Court for the Southern District of Indiana a reorganization plan and explanatory disclosure statement. The Debtor will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the Plan provides for the Reorganized Debtor to use the cash and liquidated assets to fund the payments due. The remaining funds will be retained by the Reorganized Debtor to be used in the ordinary course of business to maintain the operation of the rental property and to fund the installment payments due after the effective date of the Plan. Under the Plan, the secured claim of Republic Bank to be paid in accordance with the modification agreement between the bank and the Debtor. Convenience class of general unsecured claims will receive a distribution of 100% of the allowed amount of their claims, up to $15,0000, of which 50% will be paid on or before 45 days after the effective date. General unsecured claims which are more than $15,000 will receive a distribution of 100% of the allowed amount of their claims in biannual installments of 12.5% each made by the Reorganized Debtor over the course of 4.5 years. Equity holders are not entitled to any distribution until all of the classes are paid in full. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/PheasantRun_DS.pdf The Debtor is represented by: Stahl Cowen Crowley Addis, LLC Scott N. Schreiber, Esq. Shelly A. DeRousse, Esq. 55 West Moore, Suite 1200 Chicago, IL 60603 Tel: (312) 377-7766 About Pheasant Run Apartments, L.P. Indianapolis, Indiana-based Pheasant Run Apartments, L.P., operates a 20-acre, 184-unit apartment complex. The Company filed for Chapter 11 bankruptcy protection on March 11, 2010 (Bankr. S.D. Ind. Case No. 10-03060). According to the schedules, the Company has assets of $10,711,300, and total debts of $10,463,300. PRINCETON OFFICE: Plan Confirmation Order Stayed ------------------------------------------------ The U.S. Bankruptcy Court for the District of New Jersey stayed the confirmation order for Princeton Office Park, LP's Plan of Reorganization, pending appeal. Plymouth Park Tax Services LLC, a secured creditor, sought for the stay of the Court's order. On May 10, the Court confirmed the Debtor's amended Plan as of September 8, 2009. According to the amended Plan, the monies necessary for funding this Plan will be derived from a loan from United States Land Resources, L.P., a New Jersey Limited Partnership, the general partner of Princeton GP. Under the Plan, Class One Claim will be paid its allowed claim in four equal quarterly installments with interest. Class Four Claims, if any, will be paid in full without interest by the Debtor in cash on the effective date. The Class Five General Unsecured Claims will be paid (i) interest at the Interest rate from and after the effective Date; (ii) quarterly principal and interest payments starting on the first day of the third month succeeding the Effective Date with a balloon on the last (20th) payment, and (iii) amortization over 25 years. The Class Six equity interest holders will be retained by the equity interest holders. A full-text copy of the amended Plan is available for free at: http://bankrupt.com/misc/PrincetonOffice_amendedPlan.pdf The Debtor is represented by: Norris, McLaughlin & Marcus, PA 721 Route 202-206 P.O. Box 5933 Bridgewater, NJ 08807-5933 Tel: (908) 722-0700 About Princeton Office Park Headquartered in Morristown, New Jersey, Princeton Office Park, LP, is a real estate development company. The assets of the Company consist of approximately 170,000 square feet of building on 37 acres located at 4100 Quakerbridge Road, Township of Lawrence, Mercer County, New Jersey. The property has been re- zoned for multi-family residental use at 10 units per acre or 370 units. Princeton Office Park GP, L.P. holds a 50% equity interest in the Debtor. Princeton GP's general partner is United States Land Resources, L.P., a New Jersey limited partnership, whose general partner is United States Realty Resources, Inc., a New Jersey corporation. Lawrence S. Berger is the president of USRR. The Debtor's limited partners is Success Truehand GmbH, which holds a 31.67% equity interest in the Debtor. The Company filed for Chapter 11 protection on September 9, 2008 (Bankr. D. N.J. Case No. 08-27149). Melissa A. Pena, Esq., at Norris, McLauglin & Marcus, in New York, and Morris S. Bauer, Esq., at Norris McLaughlin & Marcus PA, in Bridgewater, New Jersey, represent the Debtor as counsel. In its schedules, the Debtor listed total assets of $25,000,000 and total debts of $2,517,370. R. ESMERIAN: Facing Involuntary Chapter 7 Petition -------------------------------------------------- Ralph Esmerian, who owned liquidated antique jewelry retailer Fred Leighton LLC, and his company R. Esmerian Inc. were hit with involuntary Chapter 7 petitions (Bankr. S.D.N.Y. Case Nos. 10-12721 and 10-12719) by creditors alleging they are owed $40 million. According to The Wall Street Journal, Stewardship Credit Arbitage Fund LLC, Stewardship Credit Arbitage Fund Ltd. and Northlight Fund LP claim to be owed $40 million in total and related that the debt stems from a $25 million loan made in December 2006 to R. Esmerian Inc. from Acorn Capital Group LLC. The funding was eventually increased to $40 million and assigned as promissory notes to the three creditors, who now say they're owed interest and other fees, in addition to the principal. Bloomberg News recounts that secured lender Merrill Lynch Mortgage Capital Inc. precipitated the Fred Leighton Chapter 11 filing in April 2008 by filing suit in state court to hold a foreclosure auction. Ultimately, Fred Leighton was liquidated under a Chapter 11 plan proposed by Merrill. The Leighton plan was confirmed in November 2009. The Journal relates that Mr. Esmerian was the one who ushered Fred Leighton into Chapter 11 in 2008, seeking to dodge an attempt by Christie's to put a $75 million collection of jewels on the auction block, at the request of lender Merrill Lynch. The jeweler eventually sold some of its assets to a group led by Madison Avenue jeweler Kwiat -- but Esmerian couldn't prevent the Christie's sale entirely. A 2009 Christie's auction of select Fred Leighton jewels brought in $15.3 million to the estate. RADIAN GROUP: S&P Raises Counterparty Credit Rating to 'CCC+' ------------------------------------------------------------- Standard & Poor's Ratings Services said that it raised its local currency counterparty credit and senior unsecured debt ratings on holding company Radian Group Inc. to 'CCC+' from 'CCC'. The outlook is negative. Standard & Poor's believes that Radian will use the proceeds of its recent issuance of $550 million in common stock to fund working capital requirements and for general corporate purposes, including capital support for the mortgage insurance operating subsidiaries. "S&P understands that management intends, as much as possible, to hold the funds at the holding company to maximize its flexibility in using them," said Standard & Poor's credit analyst Dick P. Smith. Liquidity at the holding company has improved in the past two quarters as resources relative to needs have improved. The holding company has reported that it believes it has sufficient liquidity to meet its obligations into 2012. To the extent that Radian doesn't use proceeds to support operating company capital, the sale of common equity enhances holding company liquidity, providing an added cushion against adverse developments and/or extending the time frame for which liquidity resources can meet obligations. However, even if a significant portion of the proceeds get downstreamed to the operating mortgage insurance companies, the holding company has sufficient resources to meet near-term obligations. Because of ongoing economic uncertainty and the ultimate losses that may be realized, the local currency financial strength ratings for the mortgage insurance operating companies -- Radian Guaranty Inc., Radian Insurance Inc., Radian Mortgage Insurance Inc., and Amerin Guaranty Corp. -- remain unchanged at 'B+'. The outlooks on Radian Group and Radian Guaranty are negative, largely reflecting ongoing economic uncertainty and the potential for litigation risk relating to rescission activity. RADIENT PHARMACEUTICALS: Posts $2.5 Mil. Net Loss for March 31 Qtr ------------------------------------------------------------------ Radient Pharmaceuticals Corporation filed its quarterly report on Form 10-Q, showing a $2.5 million net loss on $36,842of net revenues for the three months ended March 31, 2010, compared with $1.6 million net loss on $2.7 million net revenues for the same period a year earlier. The Company's balance sheet at March 31, 2010, revealed $26.3 million in total assets and $7.0 total liabilities, for a total stockholders' equity of $19.2 million. The Company failed to file Form 10-Q on-time. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6328 About Radient Pharmaceuticals Headquartered in Tustin, California, Radient Pharmaceuticals Corporation is an integrated pharmaceutical company devoted to the research, development, manufacturing, and marketing of diagnostic, and premium skin care products. In its April 15, 2010 report, KMJ | Corbin & Company LLP in Costa Mesa, California, noted that the Company has incurred a significant operating loss in 2009 and negative cash flows from operations in 2009 and has an a working capital deficit of approximately $4.2 million at December 31, 2009. These items raise substantial doubt about the Company's ability to continue as a going concern. RENO-SPARKS INDIAN: Fitch Affirms 'BB' Issuer Default Rating ------------------------------------------------------------ Fitch Ratings takes this rating action on Reno-Sparks Indian Colony, NV as part of its continuous surveillance efforts: -- Long-term Issuer Default Rating affirmed at 'BB'. The Rating Outlook is Stable. Rating Rationale: -- The rating reflects the overall operations of the RSIC for which financial resources are solely dependent upon economically sensitive and concentrated sales and excise taxes in a region hit particularly hard by the economic downturn. -- RSIC has a modest level of financial flexibility exacerbated by economic downturn, with few signs of recovery and delay in key economic development projects. -- Overall tribal services are largely supported by enterprise fund operations which have shown some improvement due to competitive pricing and a tribal tax advantage which has allowed RSIC tobacco sales to buck national and regional trends. -- Financial management is solid reflected in expenditure cuts resulting in continued, albeit slower than originally planned, reduction of the cumulative general fund deficit. -- Diversification away from tobacco sales and excise tax dependency should create more financial stability over the long term although a high level of concentration is likely to remain. -- RSIC maintains additional financial resources outside of the general and enterprise funds which can provide short-term financial cushion if needed. Key Rating Drivers: -- Continued improvement in financial performance is dependent upon RSIC's ability to manage spending against fluctuations in enterprise fund revenues, which provide the majority of RSIC resources. -- Demonstrated diversification of sales tax revenues and ability to manage an increase in fixed costs associated with further leverage could reduce the overall risk profile for the credit. Summary: The tribe's authority to levy and collect sales and excise taxes on businesses operating on tribal trust land is generated from an agreement with the state signed in 1991. Tribal trust land consists of about 2,000 non-contiguous acres in and around downtown Reno, Nevada. The agreement stipulates that the tribe must charge a rate at least equivalent to the state's sales and excise taxes on tobacco products (sold at its smoke shops) but because it does not pay taxes on tobacco product purchased for sale, maintains an important pricing advantage over its non-tribal competitors. The tribe has flexibility on sales taxes levied on other business operations, like general retail and auto sales. There are no other tribally owned smoke shops in the RSIC service area. Audited sales tax revenues from the five tribal-owned smoke shops represented 63% of general fund revenues in 2008 and support overall tribal operations. Other retail businesses on tribal land that generate sales tax are led by Mercedes Benz and Acura dealers. At the time of Fitch's initial rating in 2006 the RSIC expected the near term development of a Wal-Mart but the project was delayed. After an investment by the RSIC to remediate contamination on the site, the project is set to open in the fall of 2010. The regional economy remains severely pressured due to the recession causing below-budget sales tax revenues. As a result, the RSIC's financial performance is showing a slower recovery than originally projected although improvement is evident. Audited general fund results for 2008 reflect a reduction in the fund deficit and RSIC reports that near-final results for 2009 will produce another operating surplus in the general fund, bringing the fund balance deficit to -$1.8 million or -15% of the approximately $12 million budget; improved from -25% of spending in 2007. Based on first quarter 2010 results, RSIC is projecting another surplus for the year. A return to positive balance in the general fund is not likely at least for the next few years. Importantly, the RSIC retains fiscal cushion outside the general fund in the enterprise, grant and capital funds. Combining available funds with the general fund deficit estimate for 2009 yields an adequate unrestricted balance of $4 million. Longer-term financial stability is largely dependent upon the RSIC's ability to further diversify its revenue stream. While Fitch expects the tribe to remain largely dependent on sales tax revenues, diversification of the sources of such sales taxes could enhance the credit profile. Successful opening and operation of the new Wal-Mart store on tribal land should help reduce the tobacco revenue concentration. The RSIC is currently booking rental payments from the site and projects that the first full year of Wal-Mart operations in 2011 will generate sales taxes totaling 26% of the projected $12 million sales tax receipts. In the same year, the RSIC is expecting smoke shop taxes totaling 52% and 21% from other retail establishments. If actual results differ greatly from projections, the tribe's fiscal recovery could be in jeopardy, as flexibility to reduce spending is somewhat limited. The RSIC has outstanding debt of $14.9 million, series 2006 fixed rated bonds rated 'AA-' by Fitch based on a direct-pay letter of credit provided by U.S. Bank, National Association. The RSIC's debt profile includes $7.4 million in outstanding bank loans in addition to the series 2006 bonds. Over the last year, the tribe issued $61,345 to fund environmental remediation at the Wal-Mart site and plans an additional $8 million in sales tax bonds in 2012. Pursuant to an agreement with the state, the sales tax bonds will fund construction of a state restitution center in exchange for the tribe obtaining six acres of state land adjacent to the Wal-Mart site which will be used for future economic development. The tribe's exposure to the capital costs of the restitution center is capped at $8 million. Revenue sharing prescribed in the agreement with the state will begin six months after Wal-Mart opens. The LOC supporting the series 2006 bonds expires in July 2010 and the tribe has received another auto-renewal, similar to 2009, given that the bank has not indicated otherwise and must have done so 120 days prior to the expiration date. If the LOC is terminated without substitution, a mandatory tender is triggered. At that point the bonds become bank bonds and the terms of the indenture specify that the RSIC must pay the bonds in full within 36 hours or pay a rate to the bank of 5% above prime until the bonds are paid in full. Ongoing payments required under a bank bond scenario would add significant additional stress to the RSIC's financial profile, as debt service on the bonds, now 18.5% of general fund spending, would rise notably. The RSIC is a federally recognized tribe with a reservation consisting of noncontiguous trust land totaling over 2,000 acres in and around downtown Reno, Nevada, within Washoe County (the county). The tribe has approximately 1,025 enrolled members and employs approximately 281 people, 45% of which are tribal members. The tribe is governed by an eight-member tribal council and a tribal chairman, all elected to four year staggered terms. RIVER ROCK: Taps Marcus & Millichap to Handle Bankruptcy Sale ------------------------------------------------------------- Marcus & Millichap Real Estate Investment Services has been hired to coordinate the bankruptcy sale of River Rock Lodge. River Rock Lodge is a 58-unit assisted living facility located in the upscale resort town of Jackson, Wyoming. Jacob Gehl, a Vice President of Investments in the Chicago Downtown office of Marcus & Millichap, has been hired to coordinate the transaction. The seller is an entity affiliated with Sunwest Management, Inc. Since January of 2009, Sunwest Management has been operating under an SEC receivership in bankruptcy after the former CEO was accused of conducting a massive fraud. River Rock Lodge is financed with a HUD loan, and HUD has agreed to cooperate with the sales process. River Rock Lodge currently has 36 occupied units, and is located at 3000 West Big Trail Drive in Jackson, Wyoming 83001. Marcus & Millichap's Broker of Record for Wyoming Mr. Richard Bird will also be involved in the transaction. The sales process will be conducted as a 363 sale which is common in bankruptcy and involves the selection of a stalking horse bidder. All first round offers are due on June 28th. ROBERT CORRIGAN: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Joint Debtors: Robert B. Corrigan Bonita J. Corrigan 591 North Sierra View Way Eagle, Id 83616 Bankruptcy Case No.: 10-01589 Chapter 11 Petition Date: May 23, 2010 Court: U.S. Bankruptcy Court District of Idaho (Boise) Judge: Terry L. Myers Debtor's Counsel: Kelly I. Beeman, Esq. 708 1/2 W Franklin Boise, ID 83702 Tel: (208) 345-3045 E-mail: jerri@beemangroup.org Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Joint Debtors say that assets total $607,568 while debts total $1,085,134. A copy of the Joint Debtors' list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/idb10-01589.pdf The petition was signed by the Joint Debtors. SAGITTARIUS RESTAURANT: Moody's Lifts Corp. Family Rating to Caa1 ----------------------------------------------------------------- Moody's Investors Service upgraded Sagittarius Restaurant LLC's Corporate Family Rating and Probability of Default Rating to Caa1 from Caa2, while assigning B1(LGD2, 24%) to the new $199 million senior secured credit facilities. The rating outlook is stable. This concludes the review for possible upgrade that was initiated on April 29, 2010. The ratings on the old bank facilities were withdrawn concurrently. The rating action is prompted by completion of Sagittarius' recapitalization and refinancing. The final terms closely match those anticipated in Moody's most recent press release dated May 4, however the revolving credit facility commitment amount has been modestly upsized to $39 million from $35 million and the interest rate has also been increased. These changes remain consistent with the Caa1 CFR. The Caa1 CFR reflects Sagittarius' high leverage deployed in its capital structure despite the significant debt reduction as a result of the recent debt recapitalization. The Caa1 also incorporates the still challenging operating environment particularly in California, as well as the potential impact from commodity inflation considering the prices of some major food input items, such as meat and cheese, are on the rise. Also, Del Taco's management needs to demonstrate it can effectively execute its development plan and business strategy on a standalone basis. Positively, the rating is consistent with Moody's view that Del Taco's operating performance, on a standalone basis, is expected to be stable in the coming year and the divestiture of the Captain D's should improve Sagittarius' business profile, considering Del Taco's much stronger operating margin and greater growth potential. The stable outlook presumes that the company will likely generate modestly positive free cash flow and maintain an adequate liquidity profile over the next 12 months. The rating action is: Ratings upgraded: * Corporate Family Rating -- upgraded to Caa1 from Caa2 * Probability of Default Rating -- upgraded to Caa1 from Caa2 Rating revised: * $199 million 5-year senior secured credit facilities -- to B1 (LGD2, 24%) from * (P) B1 (LGD2, 24%) Ratings withdrawn: * $60 million senior secured revolving credit facility due 2012 at B2 (LGD2, 21%) * $265 million ($258.5 million outstanding at the end of 2009) senior secured term loan credit facility due 2013 at B2 (LGD2, 21%) Moody's last rating action occurred on May 4, 2010 when a provisional rating of (P)B1 was assigned to the proposed new credit facilities. Sagittarius Restaurants LLC, headquartered in Lake Forest, California, operates and franchises Mexican QSRs under the Del Taco brand name. The company had 518 units in 16 states and generated system-wide sales of approximately $568 million at the end of December 2009. Sagittarius is owned by a consortium of private equity firms. SAGITTARIUS RESTAURANTS: S&P Downgrades Rating to 'SD' ------------------------------------------------------ U.S. restaurant operator Sagittarius and its subordinated noteholder have completed an arrangement whereby the holder's claim is substantially below original face value. S&P is lowering its rating to 'SD' (selective default) from 'CC'. S&P expects to raise the 'SD' rating to 'B' in the next couple of days to reflect the company business and balance sheet and business restructuring highlighted by the sale of Captain D's and an equity infusion. SPANSION INC: Stay Denied on Stock Distribution ----------------------------------------------- Bill Rochelle at Bloomberg News reports that following a hearing on May 19, the U.S. District Court dissolved the temporary stay of the distribution of stock to holders of senior notes and exchangeable debentures under Spansion Inc.'s plan. Although Spansion implemented the Chapter 11 plan on May 10, a district judge granted holders of exchangeable notes the temporary stay. According to Bloomberg, unless the exchangeable noteholders can obtain a stay from the circuit court of appeals, the distribution of the stock may moot their appeal from the bankruptcy court's April 16 confirmation order approving the plan. Spansion, its official committee of unsecured creditors, senior noteholders and holders of trade claims have opposed the convertible noteholders' request for a stay. Spansion has said that any stay of the Plan would require the convertible noteholders to post a bond "sufficient to cover the resulting damage inflected upon them and each of their creditor constituencies." The holders of trade claims say a stay would delay the Debtors' emergence from Chapter 11; accelerate the already deteriorating value of the Debtors caused by employee attrition, Chapter 11 expenses and declining customer relationships; and jeopardize the numerous funding commitments from various lenders that are necessary for the Debtors to effectuate the Plan. About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc. and its affiliates filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09- 10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. As of Sept. 30, 2008, Spansion had total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. Judge Kevin J. Carey confirmed Spansion's Plan of Reorganization on April 16, 2010. A group of holders of Convertible notes and equity in Spansion presented an alternative plan, which would pay senior noteholders in full and has funding commitment of in excess of $425 million, but the plan was rejected. SPECTRUM BRANDS: S&P Raises Corporate Credit Rating to 'B' ---------------------------------------------------------- Standard & Poor's Ratings Services said that it raised its corporate credit rating on Madison, Wis.-based Spectrum Brands to 'B' from 'B-'. At the same time, S&P assigned a 'B' issue-level rating to Spectrum's proposed $ 1 billion senior secured term loan and proposed $500 million notes, and a 'CCC+' rating to its subordinated notes due 2019. S&P removed all the ratings from CreditWatch, where they were placed on Feb. 11, 2010, following the announcement of the merger. The ratings are contingent upon the successful consummation of the proposed merger according to the capital structure currently proposed. Upon consummation of the proposed merger, S&P will withdraw S&P's ratings on Spectrum's existing term loan and notes, as well as Russell Hobbs' existing 'B' corporate credit rating. If the merger is not successfully completed as currently anticipated, S&P would re-evaluate the ratings on Spectrum. "With the proposed transaction, Spectrum Brands will have a larger sales and EBITDA base, about $3.2 billion and $400 million, respectively, and S&P believes the transaction will enhance the company's financial profile, including extending debt maturities," said Standard & Poor's credit analyst Susan Ding. "S&P believes the addition of Russell Hobbs' portfolio of well-recognized brands, including George Foreman, Black & Decker, and Farberware, will also expand Spectrum's already diversified product offerings, and improve the company's business profile." Spectrum's existing business lines include global batteries, personal care, home and garden, and global pet supplies. "The ratings on Spectrum Brands reflect the company's volatile operating performance in the past couple of years, high debt leverage, integration risk, the commodity nature of the small appliance business, and challenges in the battery and home and garden business segments," added Ms. Ding. Increased commodity costs and an intensely competitive and promotional retail environment are the key difficulties facing these mature segments. While operating results have improved somewhat in recent quarters for both Spectrum and Russell Hobbs, as a result of lower commodity costs and better operating efficiencies, S&P believes commodity costs could increase and affect results in the next 12- 18 months. Nonetheless, S&P believes Spectrum Brands will benefit from the Russell Hobbs transaction with further expansion of its diversified product portfolio and geographic footprint, with over 40% of combined sales from outside of North America. The stable outlook reflects S&P's belief that the company's operating performance will continue to improve and that pro forma credit measures will be within its expectations, namely leverage in the 4x area and EBITDA interest coverage in the 2.5x area. Spectrum's emergence from Chapter 11 bankruptcy protection in 2009 extinguished about $840 million of the company's prior debt. Spectrum's reported total debt outstanding as of April 4, 2010, was $1.6 billion. Upon completion of the proposed merger, Harbinger Capital Partners will own about 65% of the combined company (it currently owns about 40% of Spectrum and 100% of Russell Hobbs) and it will convert its $157 million loan to Russell Hobbs into equity. Pro forma for the merger, S&P estimates the combined entity will have about $1.8 billion in debt and adjusted pro forma leverage in the 4.2x area. It is S&P's opinion that Spectrum had a prior history of highly aggressive debt-financed acquisitions, including Tetra and United Industries (2005), Remington Products Co. (2003), and Varta AG (2002) for a total cost of more than $2 billion. In recent years, management of both Spectrum and Russell Hobbs have restructured the business segments and improved operating efficiency. S&P expects the combined entity will further benefit from cost savings synergies. The company estimates synergies from the combination to be in the range of $25 million to $30 million dollars. S&P expects liquidity should be adequate. S&P believes the company's proposed $300 million asset-based facility (unrated) should be more than sufficient for seasonal working capital needs. Drawings under the facility are based on an eligible borrowing base consisting of eligible accounts receivable and inventories. As of April 4, 2010, Spectrum had cash of about $55 million. S&P estimates the company would maintain cash balances in the $50 million range for working capital needs. S&P expects that the term loan facility's financial covenants (to be finalized) will have at least 20% cushion going forward. The proposed term loan amortizes 1% per year (about $10 million), and S&P estimates the company's cash flows should be more than adequate to support this annual amortization and capital expenditures of about $40 million. The proposed term loan and senior note facilities mature in 2017, thereby enhancing the company's liquidity profile, as Spectrum's existing facilities mature in 2012. The outlook is stable. Following the proposed merger of Spectrum and Russell Hobbs, S&P believes the company will gain scale, a larger EBITDA base, and improve its global footprint and product portfolio. S&P expects the new combined entity to continue to improve operating results in each of its business segments, and reduce leverage with internal cash flow generation. If leverage increases to well over 7x, if covenant cushion tightens significantly, and/or if operating trends deteriorate, S&P would lower the rating. This could occur in a scenario of low-single- digit sales decline and 150 basis-point margin deterioration, assuming debt levels do not increase following this transaction. On the other hand, if the company is able to sustain operating improvements, maintain covenant cushions close to 20%, and sustain leverage near 4x, S&P may consider raising the ratings. STERLING FIN'L: Discloses Deal With Warburg Pincus on Investment ---------------------------------------------------------------- Sterling Financial Corporation disclosed an agreement for an investment from Warburg Pincus Private Equity X, L.P. that supports Sterling's recapitalization and recovery plan. Under the terms of the agreement and subject to the approval of the transactions by the U.S. Treasury and the other conditions described below, Warburg Pincus would invest $139 million in Sterling. If the recapitalization transactions contemplated by the agreement are completed, Warburg Pincus would own common stock, Series B participating voting preferred stock (the "Series B stock") and warrants representing approximately 20.5 percent of Sterling, calculated in accordance with Federal Reserve guidelines on an as-converted basis and after giving effect to the exercise of these warrants. As part of the Warburg Pincus investment, Thomas H. Lee Partners, L.P. ("THL") has agreed to adjust the size of its previously announced proposed investment to an amount equal to the Warburg Pincus investment. The Warburg Pincus investment will be made on substantially the same terms as THL's investment. Upon the closing of the recapitalization transactions, the two firms would invest a total of $278 million on a combined basis, and would hold an ownership interest of approximately 40 percent of Sterling calculated on the basis described above. As part of the Warburg Pincus investment and subject to the closing of the recapitalization transactions and required regulatory approvals, Warburg Pincus Managing Director David A. Coulter would join the Sterling board of directors. Coulter is co-head of Warburg Pincus Financial Services investment activities and brings to Sterling's board over 30 years of banking industry experience. Coulter is the former Chairman and CEO of BankAmerica and former Vice Chairman of JP Morgan Chase. Coulter's appointment would be in addition to the previously announced pending appointments of Les Biller, the former Vice Chairman and Chief Operating Officer of Wells Fargo, as chairman of the board and THL Managing Director Scott Jaeckel as a member of the board. Sterling President and Chief Executive Officer Greg Seibly said, "We are pleased to announce Warburg Pincus as an investor in Sterling. Warburg Pincus is a highly successful bank sector investor that has long-standing and deep knowledge of our company. We believe that the combination of Warburg and THL represent key components in our efforts to recapitalize the company." David Coulter said, "We are looking forward to partnering with Greg Seibly and Les Biller in providing governance input and support for Sterling as the company continues to build on its strong regional banking franchise in the Pacific Northwest." Each of the Warburg Pincus and THL investments and the U.S. Treasury exchange previously announced would be conditioned upon each other and on other closing conditions, including, among others, Sterling raising a total of at least $720 million of capital (inclusive of the Warburg Pincus and THL investments and the previously announced additional capital raise), receipt of regulatory approvals and third party consents, Sterling's maintenance of asset levels and capital ratios, the absence of material changes in the characteristics of Sterling's loan portfolio, no occurrence of an "ownership change" that would affect the preservation of certain of Sterling's deferred tax assets, no occurrence of a material adverse effect and no adverse change in banking or bank holding company law, rule or regulation. Closing of the recapitalization transactions are not conditioned upon receipt of any shareholder approvals. About Sterling Financial Spokane, Wash.-based Sterling Financial Corporation (NASDAQ: STSA) -- http://www.sterlingfinancialcorporation-spokane.com/-- is the bank holding company for Sterling Savings Bank, a commercial bank, and Golf Savings Bank, a savings bank focused on single-family mortgage originations. Both banks are state chartered and federally insured. Sterling offers banking products and services, mortgage lending, construction financing and investment products to individuals, small businesses, commercial organizations and corporations. As of March 31, 2010, Sterling Financial Corporation operated 178 depository branches throughout Washington, Oregon, Idaho, Montana and California. The Company's balance sheet as of March 31, 2010, showed $10.555 billion in assets, $10.309 billion in total liabilities, and $245.5 million in stockholders' equity. * * * As reported in the Troubled Company Reporter on March 22, 2010, BDO Seidman, LLP, in Spokane, Wash., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered significant net losses during 2009 and 2008, a decline in regulatory capital to support operations, and regulatory issues. STRAFFORD COUNTY: Moody's Affirms 'Ba2' Rating on Parity Debt ------------------------------------------------------------- Moody's Investors Service has removed Strafford County's (New Hampshire) general obligation bond rating from watchlist for possible downgrade, affirmed the county's Ba2 rating, and assigned a negative outlook, affecting approximately $21 million in outstanding parity debt. The bonds are secured by a general obligation unlimited tax pledge. Affirmation of the Ba2 rating and assignment of the negative outlook reflects the county's weak financial position, lack of liquidity, and heavy reliance on cash flow borrowing. The negative outlook incorporates Moody's belief that ongoing expenditure demands and the phase out of federal stimulus funds will challenge the city's recovery plans. Accumulated Deficit Reduced Slightly With Positive Fiscal 2009 Results; County Remains Heavily Reliant On Cash Flow Borrowing Fiscal 2009 results exhibited incremental improvement in the county's financial position. Importantly, the county's fiscal 2009 audited statements include an accounting adjustment that reduced the nursing home deficit with a transfer from an amount reserved in General Fund balance for the illiquid receivable due to the General Fund from the nursing home. The accounting change had no impact on the amount of unreserved General Fund balance. Net of this adjustment General Fund operation ended positively by $1.67 million, reducing the accumulated unreserved General Fund deficit to a negative $9.2 million (-25.5% of revenues) from a negative $10.5 million (-30% of revenues). The $9.2 million accumulated deficit represents the amount still due to the General Fund from the nursing home. Nursing home operations also ended positively in fiscal 2009, supported by federal stimulus-related expenditure relief. As is typical the fiscal 2010 budget (12/31 fiscal year) was adopted late, on March 20th. The budget is balanced with additional property taxes and includes a $5.4 million subsidy for the nursing home, an amount in line with fiscal 2009 levels, and approximately $1.8 million of federal Medicaid relief. Current year-end projections indicate an additional operating surplus of $2.6 million due to unbudgeted federal stimulus funds, excess jail revenues, and expenditure savings. Further, through the appropriation of annual deficit reduction amounts, the county hopes to eliminate the accumulated deficit by 2014. Due to a constrained cash position, and the timing of property tax receipts (one payment on December 17th), the county continues to rely heavily on the use of tax anticipation notes and revenue anticipation notes to fund operations. The county regularly issues TANs equal to the entire amount of the property tax levy, through two TAN issuances in February and April. Importantly, the county's levy is made whole by its member municipalities with no history of missed payments. The county also regularly issues RANs which are generally paid off with federal and state Medicaid reimbursements in early February, crossing fiscal years. In support of fiscal 2009 operations, the county issued a $10 million note in December 2008 to fund operations for the month of January, which was paid down with a $19 million note in February 2009 (due 12/31). The county also issued a $7.2 million note in April 2009 (due 12/31), following the adoption of the county's budget in March. Further, the county issued a $7.5 million RAN in August and a $3.5 million RAN in December 2009, both payable February 2, 2010. At one time the county had $37.3 million of tax and revenue anticipation notes outstanding in fiscal 2009, equal to 143% of its levy. The county's largest debt service payments are due in January and July, making continued access to the capital markets critical to fund core county operations and pay debt service, particularly in light of the timing of the county's coupon payments at a cash low point in the beginning on January and their reliance on one financial institution for liquidity. The county's debt portfolio consists entirely of fixed rate borrowing and the county has not entered into any derivative agreements. Outlook The negative outlook reflects Moody's belief that the county will be challenged to restore and maintain long-term structural balance given ongoing expenditure demands. What could move the rating UP (remove the negative outlook): -- Sustained record of structurally balanced operations and improved liquidity levels -- Improvement of General Fund reserves and the reduction of the county illiquid receivable due from the nursing home. What could move the rating DOWN: -- Structurally imbalanced operations -- Increased level of cash-flow borrowing -- Failure to execute deficit reduction plan Key Statistics * 2007 Population: 121,581 * 2008 Full valuation: $11.2 billion * Full value per capita: $92,355 * 1999 PCI (as % of NH and US): $20,479 (16% and 95%) * 1999 MFI (as % of NH and US): $53,075 (92% and 106%) * Debt burden: 0.2% * Payout of principal (10 years): 73% * 2009 Unreserved General Fund balance: -$9.2 million (-25% of revenues) * G.O. debt outstanding: $23.2 million The last rating action with respect to the Strafford County, NH was on October 16, 2009, when a municipal finance scale rating of Ba2/on watchlist for downgrade was assigned. That rating was subsequently recalibrated to Ba2/ on watchlist for downgrade on May, 1, 2010. SUNSTATE EQUIPMENT: Loan Amendment Won't Affect Moody's Rating -------------------------------------------------------------- Moody's Investors Service said the ratings of Sunstate Equipment Co., LLC, including the Caa1 corporate family and probability of default ratings, are unaffected by the one-year extension and amendment to the asset-based revolving credit facility. Moody's last rating action on Sunstate occurred February 4, 2010, when the probability of default rating was upgraded to Caa1 from Caa2. Sunstate Equipment Co. LLC, headquartered in Phoenix, AZ, is a regional equipment supplier with 55 branches predominately in the Southwestern U.S. As of 2009 original rental fleet equipment cost was $348 million and annual revenues were $146 million. TELIPHONE CORP: Posts $397,397 Net Loss in Q2 Ended March 31 ------------------------------------------------------------ Teliphone Corp. filed its quarterly report on Form 10-Q, showing a net loss applicable to common shares of $397,397 on $1,112,108 of revenue for the three months ended March 31, 2010, compared with net income applicable to common shares of $27,502 on $323,961 of revenue for the same period of 2009. The Company's aggregate operating expenses were $1,309,086 for the period ended March 31, 2010, compared to $202,563 for the period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $1,365,725 in assets and $1,415,789 of liabilities, for a stockholders' deficit of $50,064. As reported in the Troubled Company Reporter on January 4, 2010, KBL, LLP, in New York, expressed substantial doubt about Teliphone Corp.'s ability to continue as a going concern after auditing the Company's consolidated financial statements as of and for the years ended September 30, 2009, and 2008. The Company has a working capital deficiency of $551,706 as of March 31, 2010, and has an accumulated deficit of $1,904,299 through March 31, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6320 Based in Miami Beach, Fla., Teliphone Corp. (OTC BB: TLPH) -- http://www.teliphone.ca/-- provides broadband telephone services utilizing its voice over Internet protocol (VoIP) technology platform in Canada. The Company was founded in 2004 and is based in Montreal, Canada. TELKONET INC: Posts $710,979 Net Loss for March 31 Quarter ---------------------------------------------------------- Telkonet Inc. filed its quarterly report Form 10-Q, showing a $710,979 net loss on $2.5 million of total revenue for the three months ended March 31, 2010, compared with a $1.1 million net loss on $2.8 million of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2010, showing $16.1 million in total assets, $6.2 million in total current liabilities, and $3.2 million in total long-term liabilities, for a $5.8 million total stockholders' equity. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?633f About Telkonet Milwaukee, Wisconsin-based Telkonet, Inc. is a clean technology company that develops and manufactures proprietary energy efficiency and smart grid networking technology. The Company's balance sheet as of December 31, 2009, showed $16,295,131 in assets, $9,075,117 of debts, $732,843 of redeemable preferred stock, and $6,487,171 of total equity. RBSM LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of the Company's significant operating losses in the current year and in the past. TELTRONICS INC: Posts $367,000 Net Loss for March 31 Quarter ------------------------------------------------------------ Teltronics Inc. filed its quarterly report on Form 10-Q, showing a $367,000 net loss on $6.2 million of total net sales for the three months ended March 31, 2010, compared with a $529,000 net loss on $9.6 million of total net sales for the same period a year ago. The Company's balance sheet at March 31, 2010 showed $10.1 million in total assets, $10.6 million in total current liabilities, and $4.7 million in total long-term liabilities, for a total stockholders' deficit of $5.3 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6340 Palmetto, Fla.-based Teltronics, Inc. (OTC BB: TELT) -- http://ww.teltronics.com/-- designs, installs, develops, manufactures and markets electronic hardware and application software products, and engages in electronic manufacturing services primarily in the telecommunication industry. TEXAS RANGERS: Files for Bankruptcy to Sell Baseball Team --------------------------------------------------------- Texas Rangers Baseball Partners, the partnership that owns the Texas Rangers professional baseball club, filed a Chapter 11 petition on May 24 (Bankr. N.D. Tex. Case No. 10-43400). The partnership has filed simultaneously with the bankruptcy petition a Chapter 11 plan that contemplates the sale of the club to Rangers Baseball Express LLC, an entity formed by a group that includes the current President of the Texas Rangers, Nolan Ryan, and Chuck Greenberg, a sports lawyer and minor league club owner. The transaction values the team at $575 million, according to Bloomberg News. Under the Prepackaged Plan, all creditors of TRBP will be paid in full from the proceeds of the sale or will have its obligations assumed by the purchaser, and the general partners of TRBP will retain their equity interests in TRBP. TRBP is asking U.S. Bankruptcy Judge Michael Lynn to approve the plan at a July 2 confirmation hearing. TRBP held a bidding process for the club starting August last year. Ryan-Greenberg group emerged as the best bidder over 5 other parties. TRBP, however, said that it had to file for Chapter 11 because the lenders refused to consent to the sale. Under the Prepackaged Plan, the lenders -- as well as other creditors -- are unimpaired, hence, the Debtor seek confirmation of the Plan without having to solicit votes. Under the Asset Purchase Agreement, substantially all of Texas Rangers' assets, including the Texas Rangers franchise and substantially all contractual rights related the operation of the Texas Rangers will be sold to Ryan-Greenberg. The terms of the sale include: * The club or the Ryan-Greenberg group can cancel the sale if it isn't completed by Aug. 12. * The buying group will pay $304 million cash less adjustments. In addition, the buyer will issue a $10 million note on which the buyer won't be obligated to make any payments unless the team's revenue is among the top five in MLB. * The buyer will assume debt and buy property adjacent to the ballpark from a company indirectly owned by the team's current principal owner, Thomas O. Hicks. The buyer will give Hicks $5 million cash, a $53.16 million 4% note and 1% of the equity in the team. * The sale anticipates a complete and orderly transition of the operations of the club - all tickets to games and other events will be fully honored, and all employees will keep their jobs. Kellie Fischer, CFO of TRBP, explains that since 2005, TRBP has experienced, and continues to experience, cash flow deficiencies. Mr. Hicks has provided financial support to the club through capital contributions and loans to HSG in excess of $100,000,000. "Due to the unprecedented downturn in the U.S. economic and housing industry and global economic recession, other commitments and contractual restraints, Mr. Hicks was no longer willing to provide the same material financial support he had in the past." According to Bloomberg News, HSG Sports Group LLC, a sports and entertainment holding company controlled by Hicks, owes secured lenders $525 million on first- and second-lien loans. The team has guaranteed and is liable for only $75 million of the $525 million debt to the lenders. The team's Chapter 11 plan provides that the lenders will be paid a maximum of $75 million cash. Baseball Finance LLC, an affiliate of the league, will provide an $11.5 million loan to finance the Chapter 11 case. According to TRBP, the Texas Rangers franchise cannot be consummated without first obtaining the requisite approval from the Commissioner of MLB and 75% of the MLB clubs. The Debtor says it is not aware of any opposition by MLB or the requisite percentage of MLB clubs required to consent to the sale. Bloomberg relates that a letter from Alan H. "Bud" Selig, the commissioner of Major League Baseball, says the league has no objection to the proposed reorganization plan. The Debtor is contemplating this timetable for the Prepackaged Plan: Commencement Date May 24, 2010 Hearing on Motion May 25, 2010 Mailing of Commencement/Plan Notice May 25, 2010 Objection Deadline June 25, 2010 Reply Date (if any) June 30, 2010 Confirmation Hearing Date July 2, 2010 Non-Consenting Creditors According to The Wall Street Journal, with the bankruptcy filing, Mr. Hicks now faces an angry group of creditors. The lenders, owed $540 million, are vowing to oppose the bankruptcy, arguing that the deal proposed to the court doesn't provide them with the money they are entitled to under the terms of their loan agreements. WSJ relates that the dispute between Mr. Hicks and the creditors has never been about the total price tag but rather over the division of the proceeds from the sale. Under the current deal, about $500 million would go toward the purchase of the baseball team and control of the Ballpark at Arlington. However, creditors say they would receive only about $230 million from the sale, and they are seeking as much as $320 million. WSJ reports that lawyers and bankers representing both sides continued to try to negotiate a settlement. According to a member of the creditor's group, the two sides were about $10 million to $20 million apart at the end of last week but couldn't bridge the gap. Monarch Alternative Capital L.P., a New York hedge fund, is the largest HSG creditor, holding about $100 million in the HSG debt and is a leader of those creditors opposed to the deal. To maintain control of the sale process, TRBP filed for Chapter 11. "We are proud to play an active role in resolving the deadlock in this complex sale process," Mr. Hicks said in a statement. "Rangers fans deserve management's full focus on baseball operations." According to WSJ, the deal received the blessing of MLB Commissioner Bud Selig, even though people involved with the process say two other groups bid more for the franchise. "Nolan Ryan has a proven track record with MLB club owners and I am prepared to submit this to the owners promptly for their approval," Mr. Selig said in a statement May 24. Major League Baseball has lent the Rangers $18 million to cover its expenses since last summer and has offered another $11 million in financing during the bankruptcy proceeding. About Texas Rangers Texas Rangers Baseball Partners owns and operates the Texas Rangers Major League Baseball Club, a professional baseball club in the Dallas/Fort Worth Metroplex. TRBP is a Texas general partnership, in which subsidiaries of HSG Sports Group LLC own a 100% stake. Controlled by Thomas O. Hicks, HSG also indirectly wholly-owns Dallas Stars, L.P., which owns and operates the Dallas Stars National Hockey League franchise. The Texas Rangers have had five owners since the club moved to Arlington in 1972. Mr. Hicks became the fifth owner in the history of the Texas Rangers on June 16, 1998. In its petition, Texas Rangers Baseball Partners said it had both assets and debt of less than $500 million. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtor. Forshey & Prostok LLP serves as conflicts counsel. Parella Weinberg Partners LP serves as financial advisor. TEXAS RANGERS: Case Summary & 30 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Texas Rangers Baseball Partners 1000 Ballpark Way, Suite 400 Arlington, TX 76011 Bankruptcy Case No.: 10-43400 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Northern District of Texas (Ft. Worth) Judge: D. Michael Lynn Debtor's Counsel: Martin A. Sosland, Esq. Weil, Gotshal & Manges LLP 200 Crescent Court, Suite 300 Dallas, TX 75201-6950 Tel: (214) 746-7700 Fax: (214) 746-7777 E-mail: martin.sosland@weil.com Estimated Assets: $100,000,001 to $500,000,000 Estimated Debts: $100,000,001 to $500,000,000 The petition was signed by Kellie Fischer, chief financial officer. Debtor's List of 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Alex Rodriguez Deferred $24,892,007 Compensation Kevin Millwood Deferred $12,941,419 Compensation Michael Young Deferred $3,878,859 Compensation Vicente Padilla Deferred $1,695,661 Compensation Mickey Tettleton Deferred $1,417,088 Compensation Mark McLemore Deferred $970,052 Compensation Tickets.Com Trade Debt $61,988 Rawlings Sporting Goods Con., Inc. Trade Debt $41,168 Supreme Systems Inc. Trade Debt $35,106 Fastsigns Trade Debt $28,986 New Era Cap Co. Trade Debt $28,806 Centennial Moisture Control Trade Debt $27,600 KUVN-TV Univision Group Trade Debt $25,517 TM Television Trade Debt $25,429 Weldon, Williams, & Lick, Inc. Trade Debt $25,183 TVTI Trade Debt $23,850 Clear Channel Outdoor Trade Debt $23,000 Melrose Pyrotechnics Inc. Trade Debt $20,000 Stats, Inc. Trade Debt $19,500 Redan Bilingual Media Trade Debt $19,000 Bimm Ridder Sportswear Trade Debt $17,916 CBS Outdoor Trade Debt $17,768 Paramount Services, Inc. Trade Debt $15,848 Gear for Sports, Inc. Trade Debt $15,297 Team Beans, L.L.C. Trade Debt $11,567 Republic Services Trade Debt $11,121 Stage Effects Engineering, Inc. Trade Debt $10,750 KONE Inc. Trade Debt $10,534 American Medical Response Trade Debt $10,213 Ambulance Services, Inc. Buses by Bill, Inc. Trade Debt $9,964 TOUSA INC: Expands Ernst & Young Work ------------------------------------- TOUSA Inc. and its units sought and obtained the Court's authority to expand the scope of the employment of Ernst & Young LLP to provide additional auditing services, nunc pro tunc to May 1, 2010. Pursuant to an engagement letter between the Debtors and Ernst & Young, the firm will audit and report on the financial statements and supplemental schedules of the Debtors' defined contribution plan for the year ended December 31, 2009, as well as for the six months ended June 30, 2010, which will be included in the defined contribution plan's Form 5500 filing with the Employee Benefits Security Administration of the Department of Labor. For the Additional Services, the Debtors will pay Ernst & Young's professionals according to these customary hourly rates: Title Rate per Hour ----- ------------- Partner and Principal $470 to $600 Executive Director $370 to $50 Senior Manager $365 to $490 Senior $210 to $285 Staff $145 to $195 A full-text copy of the E&Y Engagement Letter is available for free at http://bankrupt.com/misc/TOUSA_Apr30EngagemntLtr.pdf Ernst & Young will seek reimbursement for reasonable and necessary expenses it incurs. Peter N. Wellman, a partner at Ernst & Young, assures the Court that his firm does not hold or represent any interest materially adverse to the Debtors in the matters for which the firm has been employed. He maintains that Ernst & Young continues to be eligible for retention by the Debtors under the Bankruptcy Code. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on January 29, 2008 (Bankr. S.D. Fla. Case No. 08- 10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It listed assets between $1 million and $10 million, and debts between $1 million and $10 million. TOUSA INC: Files 36 Additional Track IV Adversary Proceedings ------------------------------------------------------------- TOUSA Inc. and its units initiated adversary complaints against 36 creditors to avoid and recover preferential transfers of property on April 28, 2010. Pursuant to the Adversary Proceedings Protocol Order, the Adversary Complaints initiated by the Debtors on April 28, 2010, are classified under Adversary Proceeding Track IV with amounts to be recovered by the Debtors totaling more than $250,000. On or within 90 days before the Petition Date, that is between October 31, 2007, and January 29, 2008, or the "Preference Period," the Debtors continued to operate their business affairs, including the transfer of property, either by checks, cashier checks, wire transfers or to certain entities, including the Creditors, Kristopher Aungst, Esq., at Berger Singerman, P.A., in Miami, Florida, relates. The Debtors allege that they transferred their property to the Creditors during the Preference Period. Mr. Aungst insists that the each of the Creditors is a "creditor" of the Debtors within the meaning of the term under Section 101(10)(A) of the Bankruptcy Code at the time of the Transfers. The Creditors had a right to payment on account of the obligations owed to the Creditors by the Debtors at the time of the Transfers, he says. Mr. Aungst further asserts that the Transfers were to or for the benefit of a creditor under Section 547(b)(1) of the Bankruptcy Code because the Transfers either reduced or fully satisfied a debt then owed by the Debtors to the Creditors. The Transfers thus constituted a transfer of an interest of the property of the Debtors, he insists. Moreover, Mr. Aungst points out that the Debtors were insolvent at all times during the 90 days before the Petition Date or the Preference Period. As a result of the Transfers, he stresses that the Creditors received more than they would have received if: (i) the Debtors' Chapter 11 cases were under Chapter 7 of the Bankruptcy Code; (ii) the Transfers had not been made; and (iii) the Creditors received payment of their claims under the provisions of the Bankruptcy Code. In this light, the Transfers are avoidable pursuant to Section 547(b), Mr. Aungst asserts. The Creditors, he continues, were the initial transferees of the Transfers or the immediate or mediate transferees of the initial transferees or the persons for whose benefit the Transfers were made. The Debtors inform the Court that they have sent a letter to each Creditor demanding the return of the preferential payments made. Accordingly, by virtue of the Adversary Complaints, the Debtors ask Judge Olson to: (a) enter a judgment against the Creditors; (b) avoid the Transfers pursuant to Section 547, and to the extent they are avoided, grant recovery of those transfers pursuant to Section 550 of the Bankruptcy Code; (c) award prejudgment interest at the maximum legal rate running from the date of each Transfer to the date of judgment in the Adversary Cases; and (d) order that, in accordance with Section 502(d) and (j) of the Bankruptcy Code, any claims held by the Creditors or their assignees be disallowed. A list of the defendants is available for free at: http://bankrupt.com/misc/TOUSA_TrackIVDefendants.pdf Adversary Cases Closed TOUSA, Inc., served the Court with separate notices, voluntarily dismissing two avoidance complaints it filed against Deloreto Interiors, Inc., Desert Systems Landscape, Inc., D&R Framing, Inc., with each party to bear their own attorneys' fees and costs. Accordingly, in separate rulings, Judge Olson closed the adversary proceedings on April 29, 2010, and May 7, 2010. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on January 29, 2008 (Bankr. S.D. Fla. Case No. 08- 10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It listed assets between $1 million and $10 million, and debts between $1 million and $10 million. TOUSA INC: Lenders Stipulate on Allocation for Professional Fees ---------------------------------------------------------------- The first lien term lenders of Tousa Inc., pursuant to their December 9, 2009 Amended Accounting, allocated to the second lien lenders $571,973 in what the First Lien Lenders believe represents a portion of the prepetition fees and expenses of the applicable administrative agents under the First Lien Term Loan Credit Agreement, the Second Lien Term Loan Credit Agreement and the Second Amended and Restated Revolving Credit Agreement incurred on behalf of Wells Fargo under the Second Lien Term Loan Credit. The Second Lien Lenders do not believe that the Allocated Prepetition Fees are their responsibility. The Second Lien Lenders previously reserved the right to assert that the First Lien Lenders are responsible for a portion of the fees and expenses of a real estate consultant, Integra Realty Resources Inc. The Second Lien Lenders also previously asserted that $831,992 of those fees and expenses should be allocated to the First Lien Lenders. The First Lien Lenders, for their part, do not believe that they are responsible for any Integra Fees incurred before April 13, 2009. Without making any admission or concession of any kind and solely to avoid the expenses, burdens and uncertainties of litigation, the First Lien Lenders and Second Lien Lenders entered into a stipulation to resolve their disputes concerning the Allocated Prepetition Fees and the Allocated Integra Fees. The Parties agree that $571,973 of the Allocated Prepetition Fees will be treated as constituting fees and expenses of Citicorp as administrative agent for the First Lien lenders for purposes of the Payment Motion. The First Lien Lenders will also be responsible for that sum in connection with any required disgorgement of fees and expenses. Solely as between the Parties, (i) the First Lien Lenders have previously agreed to be responsible for certain of the Prepetition Fees, and (ii) the Second Lien Lenders have previously agreed to be responsible for the Integra Fees other than the Allocated Integra Fees. As a separate matter, the Clerk of the Court returned to Van Kampen Dynamic Credit Opportunities Fund, Van Kampen Senior Income Trust, Van Kampen Senior Loan Fund and Morgan Stanley Senior Funding, Inc. their original supersedeas bond aggregating $962,466 posted on December 16, 2009. The return of the Original Bond is in light of a stipulation between the Committee and the Van Kampen Entities. In addition, the Van Kampen Entities posted a replacement bond deemed filed as of December 22, 2009 pursuant to another stipulation with the Committee. In addition, Trilogy Portfolio Company, LLC, as purchaser of the interests of Sandelman Partners Multi-Strategy Master Fund, Ltd. and Sandelman Partners Opportunity Master Fund, LP, as a First Lien Term Lender, posted a supersedeas bond with the Court for $10,175,193 on May 17, 2010 to stay execution of the Amended Final Judgment of the action initiated by the Committee against Citicorp and other secured lenders. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on January 29, 2008 (Bankr. S.D. Fla. Case No. 08- 10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It listed assets between $1 million and $10 million, and debts between $1 million and $10 million. TRANSUNION CORP: S&P Assigns Corporate Credit Rating at 'B+' ------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its 'B+' corporate credit rating to Chicago-based TransUnion Corp. The outlook is stable. At the same time, S&P assigned a 'BB-' rating to the company's proposed $250 million senior secured revolving credit facility and $940 million term loan B. The borrower on the loans is Trans Union LLC (a wholly owned subsidiary of TransUnion Corp.). The recovery rating is '2', indicating S&P's expectation for substantial (70%-90%) recovery in the event of a payment default. S&P also assigned a 'B-' rating to the company's proposed $645 million senior unsecured notes, with a recovery rating of '6', indicating S&P's expectation for negligible (0%-10%) recovery in the event of a payment default. The co-issuers under the notes are Trans Union LLC and TransUnion Financing Corp. (also a wholly owned subsidiary of TransUnion Corp). The company will use the proceeds to finance the acquisition of shares from Pritzker family business interests, and for the refinancing of existing debt. "The rating reflects TransUnion's leveraged financial profile following the proposed partial LBO," said Standard & Poor's credit analyst Martha Toll-Reed. A good market position as one of three global providers of credit information, significant barriers to entry, and strong profitability partially offset these factors. TransUnion provides data and information management tools that help businesses better manage risk and improve decision-making and provides credit data directly to consumers. TransUnion operates in more than 25 countries, and had fiscal 2009 revenues of $929 million. TRIBUNE CO: Broadcasting Unit Names Kersting as President --------------------------------------------------------- Tribune Company announced early this month that Jerry Kersting has been named President of its broadcasting division. Effective immediately, Mr. Kersting assumes responsibility for the strategic vision and day-to-day operations of the company's 23 television stations, its national cable channel, WGN America, and WGN Radio. Mr. Kersting has served as Tribune Broadcasting's Chief Operating Officer in December 2009. "Jerry's done a great job since becoming COO of our broadcast group," said Tribune's Chief Executive Officer Randy Michaels. "He's smart, innovative and driven-our stations have been expanding news, adding new programming and building audience. WGN America is stronger than ever. Jerry's leadership will keep us on the right path and drive even better results." Prior to being named COO of Tribune Broadcasting, Mr. Kersting served as Executive Vice President for Tribune, joining the company in 2008. In that role, Kersting was responsible for identifying strategic opportunities and efficiencies for the company's various media businesses. Before joining Tribune, Mr. Kersting served as EVP/Chief Financial Officer of Clear Channel Radio from 1999 to 2008. Mr. Kersting had 34 years of credited service with Clear Channel, where he held various management and executive positions at the company and its related entities, specifically Jacor, Citicasters, Great American Broadcasting and Taft Broadcasting, which through name change or acquisition make up that tenure. "We've established some strong momentum across our broadcasting division, but there is a lot more to do," said Kersting. "We intend to shake up traditional local television news by doing things differently and giving viewers innovative broadcasts and a clear choice in our markets. Every night, people turn on their local news and see the same thing wherever they flip the channel- we intend to change that." About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Examiner Hires LECG as Financial Advisor ---------------------------------------------------- Kenneth N. Klee, Esq., the Chapter 11 examiner, sought and obtained the Court's authority to employ LECG, LLC, as his financial advisor nunc pro tunc to April 30, 2010. Mr. Klee has selected LECG because of the firm's extensive advisory experience, expertise and resources. As financial advisor, LECG will: (a) assist the Examiner in identifying, investigating and analyzing the financial circumstances of the Debtors prior to and following the LBO; (b) assist the Examiner in identifying, investigating and analyzing the financial circumstances surrounding and the various transactions implementing the LBO; (c) assist the Examiner in data collection, documentation management and discovery support; and (c) perform all other services necessary to fulfill the role of financial advisor to the Examiner that the Examiner may determine are necessary and appropriate to the discharge of his duties. The Debtors will pay LECG based on the firm's current hourly rates: Director $590-$745 Consultant/Principal $330-$590 Associate $245-$330 Accounting Analyst $225-$245 Practice Management $125-$200 The Debtors will also reimburse LECG for its expenses including, among others, air couriers, photocopying, travel, postage and telephone. Fernanda L. Schmid, associate general counsel of LECG, LLC, assures the Court that her firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. In a separate filing, Wayne Elggren, director of LECG, LLC, submitted with the Court a declaration in support of the Application. Counsel to the Examiner delivered to the Court an amended Exhibit C to the declaration of Ms. Schmid in support of the Application. A full-text copy of the Amended Conflicts Search List is available for free at: http://bankrupt.com/misc/Tribune_SchmidExC.pdf No party objected to the Application, the Debtors certified. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Names S. Compton as President for Programming --------------------------------------------------------- Tribune Broadcasting announced early this month that Sean Compton has been appointed President/Programming for the division effective immediately. Compton, who has served as Tribune Broadcasting's Senior Vice President/Programming and Entertainment since 2008, will oversee programming decisions for the company's 23 television stations, its national cable station, WGN America, and WGN Radio in Chicago. "Sean is one of the most innovative thinkers and strategic programmers in the industry," said Jerry Kersting, President of Tribune Broadcasting. "He's been turning around the attitude at our station group and at WGN America by securing some outstanding syndicated programming-and better programming means better ratings. He's making a huge difference in our success." For the past two years, Mr. Compton has overseen programming and entertainment for the company's station group and WGN America, where ratings are up 19 percent year-over-year and 27 percent during prime time. He's brought some of the country's most popular off-network comedies to Tribune Broadcasting, including "Entourage," "Curb Your Enthusiasm," and "How I Met Your Mother"- all set to debut this fall. "30 Rock" will begin airing on WGN America and select Tribune stations in fall 2011. "We've made huge progress at our station group and at WGN America," said Mr. Compton. "Our fall 2010 and 2011 line-ups will have great new shows that will continue to grow our ratings and improve the image of our stations." Prior to joining Tribune, Mr. Compton spent 10 years at Clear Channel and six years at Jacor Communications, where his initial title was "Not A Vice President." About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRISZA RAY: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Trisza Leann Ray 4206 E. 118th Street Tulsa, OK 74137 Tel: (918) 428-6907 Bankruptcy Case No.: 10-11721 Chapter 11 Petition Date: May 24, 2010 Court: U.S. Bankruptcy Court Northern District of Oklahoma (Tulsa) Judge: Dana L. Rasure Debtor's Counsel: James W. Stamper, Esq. 406 S. Boulder, #640 Tulsa, OK 74103-3825 Tel: (918) 587-3700 E-mail: jwstamper@aol.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Debtor says that assets total $871,350 while debts total $1,177,779. A copy of the Debtor's list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/oknb10-11721.pdf The petition was signed by the Debtor. US AIRWAYS: Pursues Codeshare With Brazil's TAM Airlines -------------------------------------------------------- Customers of US Airways (NYSE: LCC) and Brazil's TAM Airlines will soon enjoy greater access across the Americas thanks to a new codeshare agreement between the carriers announced. The agreement is subject to both U.S. Department of Transportation (DOT) and Brazilian government approval. The two carriers have agreed to a bilateral codeshare relationship, which means that each airline may market flights operated by the other carrier as if the flying were its own. US Airways began daily, nonstop service to Rio de Janeiro from its Charlotte, N.C., hub in December 2009, while TAM serves the U.S. from Miami, Orlando, Fla., and New York City's John F. Kennedy International Airport. US Airways Senior Vice President Marketing and Planning Andrew Nocella said, "US Airways continues to bring our customers more destinations in more countries through expanded codeshare offerings. Customers can book these flights directly from US Airways and enjoy a convenient booking and travel experience just as they would on a US Airways-operated flight." For US Airways customers, this agreement will eventually provide a convenient, single-source booking, ticketing and baggage connection option for many new destinations inside Brazil, including Sao Paulo, Salvador, Recife and Brasilia through TAM's Rio de Janeiro hub. TAM Airlines customers will have access to US Airways flights from Miami, Orlando and New York's John F. Kennedy International Airport, to destinations such as Philadelphia, Phoenix and Washington, D.C. And, thanks to TAM's official entrance into Star Alliance on May 13, US Airways Dividend Miles members will also enjoy frequent flyer program benefits, including earning mileage credit and redeeming award travel on flights operated by TAM. US Airways customers will also gain access to TAM Airlines airport lounges. Customers may purchase tickets starting in early July at usairways.com or by calling 1-800-428-4322. About US Airways US Airways -- http://www.usairways.com/-- 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. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As of December 31, 2009, US Airways had total assets of $7,454,000,000, including $2,331,000,000 in total current assets, against total current liabilities of $2,789,000,000 and total noncurrent liabilities and deferred credits of $5,020,000,000, resulting in $355,000,000 stockholders' deficit. US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: Says Govt. Intervention Adding Industry Woes -------------------------------------------------------- Doug Parker, US Airways Group Inc.'s chief executive officer, criticized the Obama administration and congressional Democrats for instituting aviation policies that would hamper the industry's recovery, The Wall Street Journal reported. During a speech at an aviation luncheon, Mr. Parker said the biggest threat to the industry's viability is government intervention. He pointed, in particular, to legislation passed by the House that he believes could lead to billions of dollars in additional annual fees for airlines; would curb global airline alliances; and shift costs of air traffic-control system upgrades to the industry. He said the industry remains "fragile." Mr. Parker also criticized and reiterated its right to appeal a ruling by U.S. regulators requiring Delta Airlines Inc. and US Airways to divest some takeoff landing slots in New York and Washington as pre-condition for a larger slot swap in the two cities, WSJ said. "It's a disturbing state of affairs," Mr. Parker said in the report, adding that the ruling on the slot swap in particular "doesn't bode well" for the industry's future dealings with the Obama administration. Mr. Parker says the merger between Continental Airlines Inc. and United Airlines Inc. would improve efficiency in the industry, and is supportive of the merger. About US Airways US Airways -- http://www.usairways.com/-- 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. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As of December 31, 2009, US Airways had total assets of $7,454,000,000, including $2,331,000,000 in total current assets, against total current liabilities of $2,789,000,000 and total noncurrent liabilities and deferred credits of $5,020,000,000, resulting in $355,000,000 stockholders' deficit. US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: To Appeal DOT Rejection of Slot Transaction ------------------------------------------------------- Delta Air Lines (NYSE: DAL) and US Airways (NYSE: LCC) issued the following statement in response to the U.S. Department of Transportation (DOT) and Federal Aviation Administration's (FAA) announcement that they will reject the airlines' modified proposal with JetBlue Airways, AirTran Airways, WestJet and Spirit Airlines for a slot transaction at New York's LaGuardia Airport and Washington's Reagan National Airport. "We are disappointed the DOT and FAA rejected a proposal that would provide clear consumer benefits in both the Washington, D.C. and New York markets. There are no winners in this decision -- consumers lost, communities lost and our employees lost. Even our competitors lost. The Delta-US Airways proposal also would provide expanded access to JetBlue at Washington National Airport and to AirTran, WestJet and Spirit Airlines at New York LaGuardia Airport. Upon review of the just-issued order, we believe the DOT and FAA's decision is inexplicable and has clearly exceeded their statutory authority. We intend to appeal this ruling to the U.S. Court of Appeals." 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. On March 22, 2010, Delta and US Airways submitted to the FAA a modified agreement including the transfer of up to five pairs each of takeoff and landing slots at LaGuardia to AirTran, Spirit and WestJet, and the transfer of five pairs of Reagan National slots to JetBlue Airways. Under the proposed multi- airline 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 and US Airways would acquire 37 slot pairs at Reagan National, while also gaining access to slots at Sao Paulo and Tokyo. About US Airways US Airways -- http://www.usairways.com/-- 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. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As of December 31, 2009, US Airways had total assets of $7,454,000,000, including $2,331,000,000 in total current assets, against total current liabilities of $2,789,000,000 and total noncurrent liabilities and deferred credits of $5,020,000,000, resulting in $355,000,000 stockholders' deficit. US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. VHGI HOLDINGS: Posts $508,060 Net Loss in Q1 2010 ------------------------------------------------- VHGI Holdings, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $508,060 on $145,569 of revenue for the three months ended March 31, 2010, compared with a net loss of $192,765 on $194,339 of revenue for the same period of 2009. The Company's balance sheet as of March 31, 2010, showed $2,673,006 in assets, $1,700,332 of liabilities, and $972,674 of stockholders' equity. Pritchett, Siler & Hardy, P.C., in Salt Lake City, expressed substantial doubt about VHGI Holdings, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company has substantial losses and has a working capital deficit. "The Company has had limited operations and has not been able to develop an ongoing, reliable source of revenue to fund its existence. The Company's day-to-day expenses have been covered by proceeds obtained, and services paid by, the issuance of stock and notes payable. The adverse effect on the Company's results of operations due to its lack of capital resources can be expected to continue until such time as the Company is able to generate additional capital from other sources. These conditions raise substantial doubt about the Company's ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?6339 Lexington, Ky.-based VHGI Holdings, Inc. (OTC BB: VHGI) is a diverse company with assets and interests focusing on opportunities within the Healthcare Technology Industry and Precious Metals Markets. VISINET INC: State to Pay Foster Care Providers & Subcontractors ---------------------------------------------------------------- The Associated Press reports that the state of Nebraska agreed to pay foster care providers and subcontractors left after Visinet shutdown due to financial woes. The deal would cover back-pay from former Visinet workers but it will not reinstate the foster care provider's deal with the state. Based in Omaha, Nebraska, Visinet Inc. filed for Chapter 11 protection on April 8, 2010 (Bankr. D. Ne. Case No.10-81044). Angela L. Burmeister, Esq., at Berkshire & Burmeister, represents the Debtor. The Debtor listed both assets and debts of between $1 million and $10 million. VISTEON CORP: Shareholders to Submit Competing Plan Proposal ------------------------------------------------------------ While U.S. Bankruptcy Judge Christopher S. Sontchi hasn't sanctioned an auction, shareholders have informed the Bankruptcy Court that they are submitting an investment proposal superior to the one presently being offered by bondholders. Bill Rochelle at Bloomberg News reports that Bankruptcy Judge Christopher Sontchi, accordingly, adjourned the hearing until June 14 for approval of an investment proposal from creditors that would buy new equity for $1.25 billion. The existing plan would allow bondholders to own 95% of the new stock by providing $1.25 billion cash. The other 5% would go to noteholders. The report relates that a group of shareholders owning 13% of the existing stock said in a May 21 court filing that it is proposing an improvement on the bondholders' plan. The shareholders plan would leave reorganized Visteon with $210 million in debt, rather than $400 million. The shareholders also would backstop a $395 million offering while charging no fees. While using the bondholders' basic plan structure, the shareholders would give 10% of the stock rather than 5% to noteholders. Stockholders would buy at least $175 million in new common stock and assure there is a $210 million secured loan available on an exit from Chapter 11. According to Bloomberg, secured lenders wrote Judge Sontchi a letter saying the proposal from shareholders was "potentially constructive," and accordingly sought a delay of the hearing. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The Company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of US$4,561,000,000 and debts of US$5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Cash Collateral Use Authorized Until June 18 ---------------------------------------------------------- Bankruptcy Judge Christopher Sontchi entered his Fourteenth Supplemental Interim Order, authorizing Visteon Corp. and its units to use cash collateral through June 18, 2010. The Debtors' use of the Cash Collateral will be subject to compliance of a prepared budget, a copy of which is available for free at http://bankrupt.com/misc/Visteon_CashJune18Budget.pdf A final hearing will be held on June 17, 2010. Objections may be filed no later than June 11. A full-text copy of the 14th Supplemental Cash Collateral Order is available for free at: http://bankrupt.com/misc/Visteon_14thCashOrd.pdf About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The Company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of US$4,561,000,000 and debts of US$5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Goldman Sachs Discloses 3.90% Equity Stake -------------------------------------------------------- In a 13D filing with the U.S. Securities and Exchange Commission on May 18, 2010, The Goldman Sachs Group, Inc., and Goldman, Sachs & Co. disclosed beneficial ownership of 5,079,455 shares of Visteon Corporation common stock representing 3.90% of the shares outstanding of Visteon stock. As of April 26, 2010, Visteon had 130,320,880 shares of common stock outstanding. Goldman Sachs, a New York limited partnership, is an investment banking firm and a member of the NYSE Group, Inc. and other national exchanges. Goldman Sachs is a wholly owned subsidiary of GS Group. GS Group is a Delaware corporation and a holding company that is a leading investment banking organization. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The Company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of US$4,561,000,000 and debts of US$5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Reaches Stipulation on UK Pension Claim Withdrawal ---------------------------------------------------------------- Visteon Corp., Visteon UK Pension Trustees Limited, in its capacity as trustee of the Visteon UK Pension Plan, the Board of the Pension Protection Fund, and the Official Committee of Unsecured Creditors sought and obtained permission from the U.S. Bankruptcy Court to enter into a stipulation, which provides that: (a) the claims asserted by the UK Pension Trustee and the PPF against the Debtors will be withdrawn with prejudice; and (b) the Pension Trustee's discovery request, the Debtors' discovery request, the Debtors' objection, and the Creditors Committee's objection will be deemed withdrawn with prejudice. As previously reported, the UK Pension Trustee and the PPF filed Claim Nos. 2032, 2652, 2658, 2664, 2670, 2672, 2674, 2675, 2678, 2772, 2778, 2818, 2819, 2822, 2823, 2825, 2829, 2830, 2837, 2839, 2841, 2843, 2845, 2849, 2850, 2851, 2852, 2853, 2856, and 2859 on October 15, 2009. The Claims asserted against each of the Debtors contingent and unliquidated claims arising under the Pensions Act 2004 and the Pensions Act 2005, all applicable UK Regulations, and other claims against the Debtors relating to the Debtors' potential liability to the Claimants under UK law related to the underfunding of the Visteon UK Pension Plan. The Debtors objected to the allowance of the Claims in early April 2010. The Creditors Committee also filed an objection to the Claims in early May 2010. Each of the UK Pension Trustee and the Debtors sought certain document requests from each other in late April 2010. The parties are entering into the Stipulation to avoid the expense of further litigation among them. The parties acknowledge that execution of the Stipulation will not constitute or be deemed an admission of any kind on the part of the Claimants, the Debtors or the Creditors Committee. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The Company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of US$4,561,000,000 and debts of US$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) WENTWORTH ENERGY: Posts $372,078 Net Loss for March 31 Quarter -------------------------------------------------------------- Wentworth Energy Inc. filed its quarterly report Form 10-Q, showing a $372,078 net loss on $172,872 of total revenue for the three months ended March 31, 2010, compared with a $3.7 million net loss on $190,408 of total revenue during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $20.1 million in total assets and $68.6 million in total liabilities, for a $48.5 million total stockholders' deficit. The Company was unable to file its Form 10-Q on time. A full-text copy of the company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6341 Wentworth Energy, Inc., is an exploration and production company engaged in oil and gas exploration, drilling and development. The Company has oil and gas interests in Anderson County, Freestone County, and Jones County, Texas. WEST FELICIANA: Can Sell Mill Assets to Amzak Capital for $9MM -------------------------------------------------------------- The Hon. Douglas D. Dodd of the U.S. Bankruptcy Court for the Middle District of Louisiana authorized West Feliciana Acquisition, L.L.C., to sell substantially all the assets associated with the operation of a paper mill located in St. Francisville, Louisiana. Pursuant to the agreement, Amzak Capital Management, LLC, will purchase the assets for $9,900,000, free and clear of all liens, claims and interests. The Debtor is also authorized to sell the assets to Pacific West Commercial Corporation or its designee, the back-up bidder, if Amzak Capital fails to consummate the purchase of the assets. Saint Francisville, Louisiana-based West Feliciana Acquisition, LLC, filed for Chapter 11 bankruptcy protection on January 17, 2010 (Bankr. M.D. La. Case No. 10-10053). Louis M. Phillips, Esq., at Gordon, Arata, McCollam, Duplantis & Eagan, L.L.P., 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. WHITEHALL JEWELERS: Can Access Term Lenders' Cash Until June 30 --------------------------------------------------------------- The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware extended until June 30, 2010, Whitehall Jewelers Holdings, Inc.'s authority to: -- incur postpetition secured super-priority indebtedness; -- use the cash collateral in which the prepetition secured parties and term lenders have an interest. A hearing on the Debtors' continued use of the cash collateral beyond June 30 will be held on June 21, 2010, at 1:00 p.m. The Debtors would use the cash collateral to fund their business postpetition. The Debtors are also authorized to make a distribution to PWJ on account of its secured claims against the Debtors up to the amount of $500,000 from cash on hand upon the mutual agreement of PWJ and the Debtors. About Whitehall Jewelers Holdings Headquartered in Chicago, Illinois, Whitehall Jewelers Holdings, Inc. -- http://www.whitehalljewellers.com/-- through its subsidiary, Whitehall Jewelers, Inc., operates as a specialty retailer of fine jewelry in the United States. It offers a selection of merchandise, including diamonds, gold, precious and semi-precious jewelry, and watches. As of June 23, 2008, it operated 373 stores in regional and super-regional shopping malls under the names Whitehall and Lundstrom. The Company and Whitehall Jewelers, Inc., filed for Chapter 11 relief on June 23, 2008 (Bankr. D. Del. Lead Case No. 08-11261). Scott Rutsky, Esq., Peter Antoszyk, Esq., Adam T. Berkowitz, Esq., and Jesse I. Redlener, Esq., at Proskauer Rose LLP, represent the Debtors as bankruptcy counsel. James E. O'Neill, Esq., and Laura Davis Jones, Esq., at Pachulski, Stang Ziehl & Jones, LLP, represent the Debtors as Delaware counsel. Epiq Bankruptcy Solutions LLC is the claims, noticing and balloting agent. In its schedules, Whitehall Jewelers, Inc., listed total assets of $246,571,775 and total debts of $173,694,918. XERIUM TECHNOLOGIES: Completes Balance Sheet Restructuring ---------------------------------------------------------- Xerium Technologies, Inc.'s pre-packaged chapter 11 plan of reorganization has become effective as of May 25,2010. The Company, which had filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code on March 30, 2010, previously announced that the U.S. Bankruptcy Court for the District of Delaware confirmed its plan of reorganization on May 12, 2010. As anticipated, the entire court process was completed in less than two months. "We are delighted that we have emerged from our pre-packaged restructuring in such a quick and efficient manner," commented Stephen R. Light, President, Chief Executive Officer and Chairman. "Today's events mark a very important milestone for Xerium, as we now put this process behind us and move forward with continuing to deliver exceptional customer service and high quality products to our customers, while we remain focused on our new product initiatives and opportunities to grow our business." "We thank our customers and suppliers for their loyalty and commitment to us during this period. We also thank our lenders, equity shareholders, employees and everyone involved in helping us get to where we are today. We have come through this process with a stronger balance sheet, and we are eager to continue forward as a far more competitive enterprise." In connection with the Company's plan of reorganization, declared effective as of May 25, 2010: -- The Company has exchanged approximately $620 million of existing debt 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. -- Shares of the Company's common stock held prior to May 25's effective date have been cancelled and replaced with shares of new common stock that will commence trading on the New York Stock Exchange under the existing ticker symbol "XRM." A total of 20 million shares of new common stock have been authorized. Shareholders of record prior to the effective date will receive new common shares representing approximately 17.4% of the issued and outstanding shares, which is equivalent to a 20-to-1 reverse split of the Company's cancelled common stock. Shareholders of record will also receive four-year warrants to purchase up to an additional 10% of the fully diluted and outstanding shares of new common stock on the effective date. -- The Company has obtained a financing facility providing revolving loans of up to $20 million and a term loan of $60 million, to be used to fund its emergence from chapter 11 and provide ongoing working capital requirements. -- The Company's newly reconstituted Board of Directors takes effect and consists of seven directors, including President, CEO and Chairman Stephen Light, one director who was nominated by the Company's former Board of Directors, and five directors who were nominated by certain of the Company's lenders. -- The Company remains in ongoing discussions with the New York Stock Exchange's NYSE Regulation, Inc. regarding its financial status and the listing status of its common stock. On May 18, 2010, prior to completing the financial restructuring, the Company was notified by NYSER that it had regained compliance with NYSE's 30-trading-day $1 minimum share price standard for continued listing of its common stock, and the Company expects to remain in compliance with this standard as a result of the financial restructuring. The Company has until June 29, 2010 to regain compliance with either the NYSE's revised $50 million market capitalization or $50 million stockholders' equity requirement. Based on current information and circumstances, the Company anticipates that with its financial restructuring complete, the Company will be able to maintain the required thresholds and regain compliance within the applicable timeframe. 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 and certain subsidiaries filed for Chapter 11 on March 30, 2010 (Bankr. D. Del. Lead Case No. 10-11031). Judge Kevin J. Carey presides over the cases. John J. Rapisardi, Esq.; George A. Davis, Esq.; and Sharon J. Richardson, Esq., at Cadwalader, Wickersham & Taft LLP; and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as bankruptcy counsel. Brian Fox, Michelle Campbell, and Michael Hartley at AlixPartners, LLC, serve as the Debtors' restructuring advisors. Stephen Ledoux and Daniel Gilligan at Rothschild Inc. serve as the Debtors' investment bankers. Garden City Group Inc. is the Debtors' claims agent. Xerium Technologies disclosed total assets of $693,511,000 and total debts of $813,168,000 in its petition. Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware confirmed the Prepackaged Chapter 11 Plan of Reorganization filed by Xerium Technologies, Inc., and its debtor affiliates on May 12, 2010, after determining that the Plan satisfies the requirements of Section 1129(a) of the Bankruptcy Code. ZENITH NATIONAL: Fairfax Deal Cues Fitch to Retain Negative Watch ----------------------------------------------------------------- Fitch's ratings of Zenith National Insurance Corp. remain on Watch Negative following the closing of its acquisition by Fairfax Financial Holdings Limited. The ratings on Fairfax are unaffected by this transaction. The Rating Watch will be resolved pending a more comprehensive review of Fairfax and its subsidiaries, including Zenith, in the context of Fitch's group rating methodology. Fitch maintains a Negative Rating Watch on these ratings of Zenith and subsidiaries: Zenith National Insurance Corp. -- Issuer Default Rating 'BBB+'. Zenith National Insurance Capital Trust I -- $58.5 million 8.55% trust preferred securities due Aug. 1, 2028 at 'BB+'. Zenith's insurance subsidiaries: Zenith Insurance Company ZNAT Insurance Company -- Insurer Financial Strength rating 'A'. Fitch currently rates Fairfax and subsidiaries with a Stable Rating Outlook: Fairfax Financial Holdings Limited -- IDR 'BBB-'; -- Senior debt 'BB+'; -- $181 million 7.75% due April 15, 2012 'BB+'; -- $91 million 8.25% due Oct. 1, 2015 'BB+'; -- $283 million 7.75% due June 15, 2017 'BB+'; -- $144 million 7.375% due April 15, 2018 'BB+'; -- CDN$400 million 7.5% due Aug. 19, 2019 'BB+'; -- $92 million 8.3% due April 15, 2026 'BB+'; -- $91 million 7.75% due July 15, 2037 'BB+'. -- CDN$250 million series C preferred shares at 'BB-'; -- CDN$200 million series E preferred shares at 'BB-'. Fairfax, Inc. -- IDR 'BBB-'. Odyssey Re Holdings Corp. -- IDR 'BBB'; -- $50 million series A unsecured due March 15, 2021 'BBB-'; -- $50 million series B unsecured due March 15, 2016 'BBB-'; -- $40 million series C unsecured due Dec. 15, 2021 'BBB-'; -- $225 million 7.65% due Nov. 1, 2013 'BBB-'; -- $125 million 6.875% due May 1, 2015 'BBB-'; -- $50 million series A preferred shares 'BB'; -- $47 million series B preferred shares 'BB'. Odyssey America Reinsurance Corp. -- Insurer Financial Strength 'A-'. Crum & Forster Holdings Corp. -- IDR 'BB+'; -- $330 million 7.75% due May 1, 2017 'BB'. Crum & Forster Insurance Group: Crum and Forster Insurance Company Crum & Forster Indemnity Company The North River Insurance Company United States Fire Insurance Company -- IFS 'BBB'. Northbridge Financial Insurance Group: Commonwealth Insurance Company Commonwealth Insurance Company of America Federated Insurance Company of Canada Lombard General Insurance Company of Canada Lombard Insurance Company Markel Insurance Company of Canada Zenith Insurance Company (Canada) -- IFS 'BBB+'. * Upcoming Meetings, Conferences and Seminars --------------------------------------------- May 21, 2010 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - NYC Alexander Hamilton Custom House, SDNY, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ May 24, 2010 AMERICAN BANKRUPTCY INSTITUTE New York City Bankruptcy Conference New York Marriott Marquis, New York, NY Contact: 1-703-739-0800; http://www.abiworld.org/ June 17-20, 2010 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort and Spa, Traverse City, Mich. Contact: 1-703-739-0800; http://www.abiworld.org/ July 7-10, 2010 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Ocean Edge Resort, Brewster, Massachusetts Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2010 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Conference The Ritz-Carlton Amelia Island, Amelia, Fla. Contact: http://www.abiworld.org/ Aug. 3, 2010 AMERICAN BANKRUPTCY INSTITUTE Atlanta Consumer Bankruptcy Skills Training Georgia State Bar Building, Atlanta, Ga. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 5-7, 2010 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. 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Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 6-8, 2010 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention JW Marriott Grande Lakes, Orlando, Florida Contact: http://www.turnaround.org/ Oct. 11, 2010 AMERICAN BANKRUPTCY INSTITUTE Chicago Consumer Bankruptcy Conference Standard Club, Chicago, Ill. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 15, 2010 AMERICAN BANKRUPTCY INSTITUTE NCBJ/ABI Educational Program Hilton New Orleans Riverside, New Orleans, La. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 29, 2010 (tentative) AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium The Savoy, London, England Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. __, 2010 AMERICAN BANKRUPTCY INSTITUTE Delaware Views from the Bench and Bankruptcy Bar Hotel du Pont, Wilmington, Del. Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. 11, 2010 AMERICAN BANKRUPTCY INSTITUTE Detroit Consumer Bankruptcy Conference Hyatt Regency Dearborn, Dearborn, Mich. Contact: 1-703-739-0800; http://www.abiworld.org/ Dec. 9-11, 2010 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Camelback Inn, a JW Marriott Resort & Spa, Scottsdale, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ Dec. 2-4, 2010 AMERICAN BANKRUPTCY INSTITUTE 22nd Annual Winter Leadership Conference Camelback Inn, Scottsdale, Arizona Contact: 1-703-739-0800; http://www.abiworld.org/ Jan. 20-21, 2011 AMERICAN BANKRUPTCY INSTITUTE Rocky Mountain Bankruptcy Conference Westin Tabor Center, Denver, Colo. Contact: 1-703-739-0800; http://www.abiworld.org/ January 26-28, 2011 TURNAROUND MANAGEMENT ASSOCIATION TMA Distressed Investing Conference Aria Las Vegas Contact: http://www.turnaround.org/ Mar. 31-Apr. 3, 2011 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ June 9-12, 2011 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort and Spa, Traverse City, Mich. Contact: http://www.abiworld.org/ July 21-24, 2011 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Hyatt Regency Newport, Newport, R.I. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 4-6, 2011 (tentative) AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hotel Hershey, Hershey, Pa. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 14, 2011 AMERICAN BANKRUPTCY INSTITUTE NCBJ/ABI Educational Program Tampa Convention Center, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 25-27, 2011 TURNAROUND MANAGEMENT ASSOCIATION Hilton San Diego Bayfront, San Diego, CA Contact: http://www.turnaround.org/ Dec. 1-3, 2011 AMERICAN BANKRUPTCY INSTITUTE 23rd Annual Winter Leadership Conference La Quinta Resort & Spa, La Quinta, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Apr. 19-22, 2012 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ The Meetings, Conferences and Seminars column appears in the Troubled Company Reporter each Wednesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. Last Updated: May 15, 2010 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers" public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, Joseph Medel C. Martirez, Denise Marie Varquez, Philline Reluya, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2010. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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