/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100603.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, June 3, 2010, Vol. 14, No. 152 Headlines 143 LEWISVILLE: Case Summary & 3 Largest Unsecured Creditors ADVANCED MICRO: CEO and Sr. VP Get Salary Increases AIROCARE INC: Case Summary & 20 Largest Unsecured Creditors ALION SCIENCE: Has $1.7 Billion of Contract Proposals ALLIS-CHALMERS: DLS Argentina Inks Employment Deal with Etcheverry ALMATIS BV: Wins U.S. Court's Nod to Limit Claims Trading ALMATIS BV: Receives Court's Approval to Pay Contractors ALMATIS BV: Wins U.S. Court's Nod to Pay Foreign Creditor Claims AMBRILIA BIOPHARMA: Closes Initial Phase of a Transaction CALPINE CORPORATION: Moody's Puts 'B1' Rating on $400 Mil. Notes AMERICAN INT'L: Says Taxpayers Will Get Money Back AMERICAN INT'L: Senior Execs to Get LTPU-Based Stock Salaries AMERICAN INT'L: To Divest AIA as 'Quickly as Possible' ANGIOTECH PHARMACEUTICALS: To Hold Shareholders Meeting on July 29 ANTOINE WALKER: Eyes NBA Comeback to Repay Debts AUTOBACS STRAUSS: Again Revising Reorganization Plan BANK OF FLORIDA: Posts $48.2 Million Net Loss in Q1 2010 BEAZER HOMES: Completes $300 Million Senior Notes Offering BIOLIFE SOLUTIONS: Reports $513,000 Revenue for 1st Qtr of 2010 CAPMARK FIN'L: Proposes Angelo-Led Loan Auction; EastBanc Objects CAPMARK FIN'L: Proposes Deloitte as Tax Advisor C-N-D INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors CATHOLIC CHURCH: Alaska Diocese Amends Suit vs. CMRSA CATHOLIC CHURCH: Fairbanks Professionals File Final Applications CATHOLIC CHURCH: Portland Wants Sapp Files Unsealed CELL THERAPEUTICS: Inks Exchange Agreement with Noteholders CHRYSLER LLC: Says May 2010 U.S. Sales Increased 33% CITIGROUP INC: Sold 20% of Citi Stake for $6.2 Billion CLAIRE'S STORES: Hikes CFO Brodin & President Conroy's Salaries CLAIRE'S STORES: Reports $12,300,000 Net Loss for May 1 Qtr COMMERCIAL VEHICLE: All Directors Enter 90-Day Lock-Up Deal COMMUNITY BANCORP: Files For Chapter 7 Protection CONTINENTAL ALLOYS: Moody's Upgrades Corp. Family Rating to 'Caa1' COOPER-STANDARD AUTOMOTIVE: S&P Raises Corp. Credit Rating to 'B+' CORELOGIC, INC: Moody's Assigns 'Ba2' Rating on $500 Mil. Loan DANKA BUSINESS: Shareholders Okay Members' Voluntary Liquidation DELPHI CORP: Objects to Pensioners' Plea to Undo Plan Termination DELPHI CORP: Parties Fight Sealed Avoidance Suits DENNIS GIBBS: Section 341(a) Meeting Scheduled for June 21 DGI RESOLUTION: Lance Thibault Steps Down as CFO DISH NETWORK: Unit Reports Granting of En Banc Hearing DON GROVER: Section 341(a) Meeting Scheduled for July 8 DRAGON PHARMACEUTICAL: Earns $1.6 Million in Q1 2010 DREIER LLP: Chapter 7 Trustee Balks at Ex-Wife's Claim DUBAI HOLDING: DIC Unit Seeks 3-Month Reprieve from Lenders E*TRADE FINANCIAL: Owners Agree to 1-for-1- Reverse Stock Split ECHO THERAPEUTICS: Posts $1.9 Million Net Loss in Q1 2010 EF JOHNSON TECHNOLOGIES: Earns $190,000 in Q1 2010 ESCADA AG: Taxing Authorities Oppose Plan Confirmation ESCADA AG: Subco Wants to Enforce Sale Order on Traynor & M&M ESCADA AG: Subco Opposes Sensitive Info on 717 GFC Trial EXELTECH AEROSPACE: Files Assignments in Bankruptcy EXTENDED STAY: Expected to Emerge from Bankruptcy in September EXTENDED STAY: Proposes to Pay $9-Mil. Break-Up Fee to Starwood EXTENDED STAY: Examiner Proposes Process to Terminate Appointment FIRST AMERICAN: Fitch Withdraws 'BB+' Ratings on Two Senior Notes FIRST FEDERAL BANCSHARES: Earns $905,000 in Q1 2010 FLYING J: Amended Plan Pays Creditors & Owners in Full FONTAINEBLEAU LV: Court Throws Out Plaintiffs' MDL Claims FORD MOTOR: Has Green Light to Shutter Mercury Brand FORD MOTOR: U.S. May 2010 Sales Up 23% From Last Year FOUR SEASONS HOTELS: A Dozen Units Are In Financial Distress FOUR SEASONS: Section 341(a) Meeting Scheduled for June 17 FREESCALE SEMICON: Names Daniel Heneghan to Board of Directors FRESH DEL: S&P Changes Outlook to Stable; Affirms 'BB' Rating FUSION TELECOMMUNICATIONS: Posts $1.5 Million Net Loss in Q1 2010 GEMS TV: Court Considers Sale of Substantially All Assets Today GENCORP INC: Files 2009 Annual Report for Savings Plan GENERAL GROWTH: Equity Panel Taps Cantor Fitzgerald as Advisor GENERAL GROWTH: Shares 2009 Financial Results to Stockholders GENERAL GROWTH: Wins Nod for More Appraisal Work for Cushman GENERAL MOTORS: Dumps Reva as Indian Electric Car Partner GENERAL MOTORS: Judge Orders Tort Claimants to Halt Suits GENERAL MOTORS: New GM Names Docherty VP for Int'l Operations GENERAL MOTORS: U.S. Treasury Selects Lazard as GM IPO Advisor GENERAL MOTORS: Chevrolet-Buick-GMC-Cadillac Sales Up 32% in May GSI GROUP: Confirmed Plan Sweetened Recovery for Stockholders GUNNALLEN FINANCIAL: Files for Chapter 11 Bankruptcy in Florida JACKSON & PERKINS: Court Okays Appointment of Ch. 11 Trustee JOHN MANEELY: Moody's Gives Stable Outlook, Retains 'B2' Rating JONES SODA: Posts $2.1 Million Net Loss in Q1 2010 JPMCC 2002: Court Extends Deadline for Schedules by 30 Days JPMCC 2002: Taps Akin Gump as Bankruptcy Counsel KINETIC CONCEPTS: Moody's Affirms 'Ba2' Corporate Family Rating LEHMAN BROTHERS: LBI Engagement of Thomas Lee Terminated LEHMAN BROTHERS: LBI Trustee Employs City-Yuwa as Special Counsel LEHMAN BROTHERS: Lease Decision, Removal Periods Extended LEHMAN BROTHERS: Reduces 85 Derivatives Claims by $58 Million LEHMAN BROTHERS: Shareholders Want Official Equity Committee LEHMAN BROTHERS: SunCal Appeals Ruling Blocking Lawsuit LEVI STRAUSS: Names Mattel's CEO Robert Eckert as Director LOUIS SECORD: Case Summary & 8 Largest Unsecured Creditors MALIBU ASSOCIATES: Amends Plan Outline for Reorganization Plan MARY GONSALVES: Case Summary & 9 Largest Unsecured Creditors MARY TAPLETT: U.S. Trustee Objects to Hiring of Bankr. Counsel MEDIACOM COMMUNICATIONS: Fitch Puts 'B+' Rating on Negative Watch MEDIACOM COMMUNICATIONS: Privatization Could Affect Moody's Rating MEDIACOM COMMUNICATIONS: S&P Gives Neg. Outlook; Keeps 'B+' Rating METRO-GOLDWIN-MAYER: The Hobbit Director Quits Amid Delay MICHAELS STORES: Reports $13 Million Net Income for May 1 Qtr MOMENTIVE PERFORMANCE: Promotes William Torrence to CFO MOUNT VERNON: Put by Receiver in Chapter 11 MOVIE GALLERY: Plan Exclusivity Extended to July 31 NATIONAL ENERGY: Settles Derivative Suit over Asset Sale for $9MM NEFF CORP: Gets Court OK to Hire Kurtzman Carson as Claims Agent NEFF CORP: U.S. Trustee Appoints Five Members to Creditors Panel NEOMEDIA TECHNOLOGIES: Earns $57.3 Million in Q1 2010 NEW YORK CHOCOLATE: Plant Set for Auction on June 30 NEXSTAR BROADCASTING: Posts $1.6 Mil. Net Loss for March 31 Qtr NEXTMEDIA GROUP: Can Sell Radio Station and Related Properties NEXTMEDIA GROUP: Emerges from Chapter 11 Bankruptcy Protection NORTH LAND INVESTMENTS: Sec. 341(a) Meeting Scheduled for June 17 NOVADEL PHARMA: Posts $1.3 Million Net Loss in Q1 2010 O&G LEASING: Schedules Filing Deadline Extended Until June 21 O&G LEASING: Section 341(a) Meeting Scheduled for June 28 OKCAL HOSPITALITY: Case Summary & 20 Largest Unsecured Creditors OLDE PRAIRIE: Section 341(a) Meeting Scheduled for June 24 OMNICOMM SYSTEMS: Posts $1.5 Million Net Loss in Q1 2010 OMNICOMM SYSTEMS: Appoints Stephen Johnson as President and COO ORLEANS HOMEBUILDERS: Faces Suit by NVR Over Jilted $170M Sale OSCIENT PHARMACEUTICALS: Files First Amended Chapter 11 Plan PAETEC HOLDING: CEO Chesonis Enters Trading Plan to Sell Stock PAUL WALLACE: Section 341(a) Meeting Scheduled for June 30 PEARVILLE LP: Court Okays Spencer Crain as Bankruptcy Counsel PRIME GROUP: Ends Employment of VP Jeremy Zednick QUEPASA CORPORATION: Posts $2.7 Million Net Loss in Q1 2010 R&G FINANCIAL: Court Extends Filing of Schedules by 30 Days REGAL CINEMAS: Inks Amended Credit Agreement with Credit Suisse RICHARD SECORD: Case Summary & 12 Largest Unsecured Creditors RIGGING & WELDING: Wants to Hire J Craig as Lead Counsel R&G FINANCIAL: Taps Patton Boggs as Bankruptcy Counsel ROTHSTEIN ROSENFELDT: Ex-Bodyguard Pleads Guilty to Trashing Docs RPM INTERNATIONAL: Moody's Affirms 'Ba1' Subordinate Shelf Rating RUSTICK LLC: Court Extends Filing of Schedules until June 13 RUSTICK LLC: Taps Dilworth Paxson as Bankruptcy Counsel RUSTICK LLC: Wants to Hire Quinn Law as Local & Conflicts Counsel SANTA CLARA: Promises to Fully Pay All East West Bank Debts SECURELALERT INC: Posts $3.5 Million Net Loss in Q2 Ended March 31 SES SOLAR: Posts $457,670 Net Loss in Q1 2010 SPECIALTY PRODUCTS: Files for Bankruptcy to Resolve Asbestos Suits SPHERIS INC: U.S. Trustee Wants Disclosure of Sale Price STATION CASINOS: Has OK to Hire Campbell as Litigation Counsel SUMMIT HOTEL: Inks Amended Loan Agreement with First Nat'l Bank TENNECO INC: Fitch Rates Amended and Extended Loans at 'BB+/RR1' TIMOTHY JOHN HEILMAN: Gets OK to Hire Gerry as Bankr. Counsel TITAN ENERGY: Posts $553,922 Net Loss in Q1 2010 TLC VISION: Posts $2.3 Million Net Loss in Q1 2010 TOUSA INC: Citicorp Seeks to Intervene Transeastern's Appeal TOYS R: S&P Puts 'B' Corp. Credit Rating on CreditWatch Positive TRAILER BRIDGE: Moody's Gives Stable Outlook; Affirms 'B3' Rating TRIBUNE CO: Disclosure Statement Lacking Judge's Approval TRIDIMENSION ENERGY: Filing of Schedules Extended Until June 22 TRUMP ENTERTAINMENT: Icahn, Beal File Adversary Suit UTGR INC: Chapter 11 Plan Held Up for Legislature W HOTEL: DekaBank Wants to Prevent Owner From Filing Ch. 11 Case WASHINGTON MUTUAL: Creditors Press to Convert Ch. 11 to Ch. 7 Case WASHINGTON MUTUAL: Faces New Round of Disclosure Objections WASHINGTON MUTUAL: Hearing on Conversion Motion on Thursday WAVERLY GARDENS: Amends Outline for Reorganization Plan WESTAR ENERGY: Fitch Affirms Preferred Stock Rating at 'BB+' WESTSIDE DEVELOPMENT: Can Hire Kenneth Wrobel as Bankr. Counsel WIZZARD SOFTWARE: Posts $1.4 Million Net Loss in Q1 2010 YUVAL RAN: 5th Cir. Rejects Israeli Receiver's Chapter 15 Filing * PwC Loses Ruling in Pennsylvania Hospital System Bankruptcy Case * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ********* 143 LEWISVILLE: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: 143 Lewisville Partners, LLC c/o Shaul C. Baruch 5953 Dallas Pkwy., Suite 200 B Plano, TX 75093 Bankruptcy Case No.: 10-41789 Chapter 11 Petition Date: May 29, 2010 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Judge: Brenda T. Rhoades Debtor's Counsel: Kenneth A. Hill, Esq. Quilling, Selander, Cummiskey & Lownds 2001 Bryan Street Suite 1800 Dallas, TX 75201-3005 Tel: (214) 871-2100 Fax: (214) 871-2111 E-mail: kenhill@qsclpc.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Shaul C. Baruch, manager. Debtor's List of 3 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Jacobs, Carter & Debt $13,000 Burgess, Inc. According To Value, Ltd. Debt $2,500 The Brown Law Firm, LLP Debt $2,000 ADVANCED MICRO: CEO and Sr. VP Get Salary Increases --------------------------------------------------- The Compensation Committee of the Board of Directors of Advanced Micro Devices Inc. approved an increase to the base salary of Derrick Meyer, the Company's president and chief executive officer, from $900,000 to $950,000 and Emilio Ghilardi, the Company's senior vice president and chief sales officer, from $580,000 to $597,000, effective as of July 1, 2010. Further, the Compensation Committee approved a decrease of the Annual Incentive Plan target for Robert Rivet, the Company's executive vice president and chief operations and administrative officer, from 175% to 150% of his base salary for the second half of fiscal year 2010 About Advanced Micro Devices Headquartered in Sunnyvale, California, Advanced Micro Devices Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative processing solutions in the computing, graphics and consumer electronics markets. * * * Advanced Micro carries a 'B-' corporate credit rating from Standard & Poor's and a 'Ba3' corporate family rating from Moody's. Standard & Poor's Ratings Services said it placed its 'B-' corporate credit and senior unsecured ratings on Sunnyvale, Calif.-based graphics and microprocessor designer Advanced Micro Devices Inc. on CreditWatch with positive implications. AIROCARE INC: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: AirOcare, Inc. 44330 Mercure Circle Suite 150 Dulles, VA 20166 Bankruptcy Case No.: 10-14519 Chapter 11 Petition Date: May 29, 2010 Court: United States Bankruptcy Court Eastern District of Virginia (Alexandria) Judge: Robert G. Mayer Debtor's Counsel: Lawrence Allen Katz, Esq. Venable LLP 8010 Towers Crescent Drive Suite 300 Vienna, VA 22182 Tel: (703) 760-1921 Fax: (703) 821-8949 E-mail: lakatz@venable.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Eric Wells, president/chief executive officer. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Joyce D.C. Young $1,530,000 870 Childs Point Road Annapolis, MD 21401 EBY Family LLC $1,530,000 870 Childs Point Road Annapolis, MD 21401 Erik B. Young $1,530,000 870 Childs Point Road Annapolis, MD 21401 Carlos Lima License $750,000 Av. Ricardo Lyon 967 Providencia, Santiago, Chile Key Electronics Trade debt $352,779 2533 Centennial Blvd. Jeffersonville, IN 47130 Amco Insurace Co. Loss damage etc. $167,000 Mid-South Electronics, Trade debt $166,072 Inc. Internal Revenue Service $150,000 BB&T $148,354 EMF Properties Group,LLC Rent $35,868 Firebreak Partners, LLC Services $31,250 Jack Prouty Salary $27,675 Air Quality Sciences Trade debt $21,400 Terry Woodbridge Employee Salary $21,000 & Expenses Stuart Rutchik Employee Salary $20,126 & Expenses Washington Dept. of $12,289 Revenue United Healthcare Insurance $11,453 Insurance William Synder Employee Salary $10,079 & Expenses New Jersey Div. of Tax $9,457 Revenue Allied Electronics Trade debt $6,979 ALION SCIENCE: Has $1.7 Billion of Contract Proposals ----------------------------------------------------- Alion Science and Technology Corporation disclosed that it has more than $1.7 billion of contract proposals that have been submitted and are awaiting decision, and another $800 million of contract proposals in process. The Company ended the second quarter of fiscal year 2010 with an overall win rate of 54%. About Alion Science Alion Science and Technology Corporation, based in McLean, VA, is an employee-owned company that provides scientific research, development, and engineering services related to national defense, homeland security, and energy and environmental analysis. Particular areas of expertise include communications, wireless technology, netcentric warfare, modeling and simulation, chemical and biological warfare, program management. As of December 30, 2009, the Company had total assets of $639,046,000 against total current liabilities of $169,588,000, senior term loan payable, excluding current portion of $226,969,000, senior unsecured notes of $245,462,000, subordinated note payable of $45,715,000, redeemable common stock of $187,112,000, and accumulated deficit of $282,500,000. * * * Alion carries 'Caa3' corporate family and probability of default ratings from Moody's. Alion carries a 'B-' corporate credit rating from Standard & Poor's. ALLIS-CHALMERS: DLS Argentina Inks Employment Deal with Etcheverry ------------------------------------------------------------------ DLS Argentina Limited, a British Virgin Islands corporation and an indirect subsidiary of Allis-Chalmers Energy Inc., and Carlos Etcheverry entered into an Employment Agreement dated effective April 21, 2010, wherein Mr. Etcheverry will serve as an executive officer of Allis-Chalmers Energy. On May 17, 2010, DLS Argentina and Carlos Etcheverry entered into the Employment Agreement, effective April 21, 2010, pursuant to which Mr. Etcheverry will serve as Senior Vice President of the Drilling and Completion division of Allis-Chalmers Energy for an indefinite term. Pursuant to the Agreement, Mr. Etcheverry is entitled to an annual base salary of $400,000, subject to an annual increase in the discretion of the board of directors of the Company. In addition, Mr. Etcheverry will be eligible to participate in the Company's annual cash incentive program whereby he may earn up to 200% of his base salary based upon the achievement of certain established performance objectives related to the Company attaining established earnings before interest, taxes, depreciation and amortization (EBITDA) and the attainment of individual goals set by the Company's Compensation Committee. If Mr. Etcheverry's employment is terminated without cause and provided he does not consider himself indirectly terminated, he will receive (i) severance payments equal to his base compensation for one year, (ii) compensation for accrued, unused vacation as of the date of termination and (iii) any further compensation that may be provided by the terms of any benefit plans in which he participates and the terms of any outstanding equity grants. Mr. Etcheverry is also subject to a two-year customary non-compete agreement. If Mr. Etcheverry's employment is terminated without cause and he is not in violation of his non-compete agreement, Mr. Etcheverry will be paid severance payments for a period of one additional year following the initial one year severance payment period described above in amount equal to his base compensation for one year. About Allis-Chalmers Energy Houston, Texas-based Allis-Chalmers Energy Inc. (NYSE: ALY) -- http://www.alchenergy.com/-- is a multi-faceted oilfield services company. Allis-Chalmers provides services and equipment to oil and natural gas exploration and production companies, domestically primarily in Texas, Louisiana, New Mexico, Oklahoma, Arkansas, offshore in the Gulf of Mexico, and internationally, primarily in Argentina, Brazil and Mexico. Allis-Chalmers provides directional drilling services, casing and tubing services, underbalanced drilling, production and workover services with coiled tubing units, rental of drill pipe and blow-out prevention equipment, and international drilling and workover services. * * * Allis-Chalmers carries 'B-' issuer credit ratings, with stable outlook, from Standard & Poor's. It has 'B3' corporate family and probability of default ratings, with stable outlook, from Moody's. Its senior unsecured debt has 'Caa1' senior unsecured debt rating from Moody's. ALMATIS BV: Wins U.S. Court's Nod to Limit Claims Trading --------------------------------------------------------- Almatis B.V. and its units sought and obtained a final order limiting certain transfers of claims against them and approving related notice procedures. The Debtors believe it may be possible for a holder of a claim against them to circumvent the protections of the automatic stay by transferring its claims to an entity that lacks minimum contacts within the United States or a "foreign transferee" and is not likely to be subject to the jurisdiction of the Bankruptcy Court or the provisions of the Bankruptcy Code. The Debtors are concerned that a Foreign Transferee might consider itself to be beyond the jurisdiction of the Bankruptcy Court, disregard the automatic stay, and institute proceedings to enforce a claim in a foreign jurisdiction that has not agreed to give effect to the bankruptcy laws of the United States. Accordingly, at the Debtors' behest, Judge Glenn ruled that any sale or other transfer of claims against the Debtors will be subject to these Notice and Hearing Procedures: * Disposition of Claims. Prior to effecting any disposition of claims against the Debtors, any person or entity attempting that disposition will file with the Court, and serve on the Debtors' counsel, a Notice of Intent to Sell, Trade, or Otherwise Transfer a Claim, specifically and in detail describing the intended disposition of claims against the Debtors, regardless of whether that disposition would also be subject to the filing, notice, and hearing requirements of Rule 3001 of the Federal Rules of Bankruptcy Procedure. * Acquisition of Claims. Prior to effecting any acquisition of claims against the Debtors, any person or entity attempting that will file with the Court, and serve on the Debtors' counsel, a Notice of Intent to Purchase, Acquire, or Otherwise Accumulate a Claim, specifically and in detail describing the intended acquisition of claims against the Debtors, regardless of whether that acquisition would also be subject to the filing, notice, and hearing requirements of Bankruptcy Rule 3001. * Objection Procedures. No later than the date that is 10 calendar days after the Debtors' actual receipt of a Claims Disposition Notice or a Claims Acquisition Notice, the Debtors may file with the Court, and serve on a Proposed Claims Disposition Transferor or Proposed Claims Disposition Transferee an objection to any proposed transfer of claims described in a Claims Acquisition Notice or Claims Disposition Notice on the grounds that the transfer would inhibit the operation of the automatic stay. If the Debtors timely file an Objection by the Objection Deadline, the Proposed Claims Disposition Transaction or Proposed Claims Disposition Acquisition will not be effective unless approved by a Court order, after notice and a hearing, and that order is not subject to appeal, stay, modification, or reconsideration. If the Debtors do not timely file an Objection by the Objection Deadline, the Proposed Claims Disposition Transaction or Proposed Claims Disposition Acquisition may proceed only as specifically set forth under the Claims Notice. Any acquisition or disposition or other transfer of claims against the Debtors in violation of the Court-approved Claim Transfer Procedures will be null and void ab initio as an act in violation of the automatic stay and will confer no rights on the transferee. Debtors & GSO Ink Stipulation The Debtors and GSO Capital Partners LP entered into Court- approved stipulation in connection with the notice of hearing procedures: (1) The Debtors agree to irrevocably waive the right to seek enforcement of the procedures with respect to the acquisition, on or before May 6, 2010, of claims by GSO Capital and the funds it manages; (2) The acquisition by the GSO Entities of the claims on or before May 6, 2010 without compliance with the procedures will not be deemed void ab initio and its non-compliance will be deemed not to effect the validity, enforceability or allowance of the claims; (3) None of the GSO entities will be deemed to have violated the automatic stay or the Court's interim order approving the procedures by virtue of their acquisition of the claims on or before May 6, 2010; and (4) The procedures contained in the Interim Order will not apply to the acquisition of any additional claims by the GSO Entities or to their counterparty with respect to the acquisition, sale, transfer or assignment of a claim against the Debtors from one GSO entity to another GSO entity. A full-text copy of the Almatis-GSO Stipulation is available without charge at http://bankrupt.com/misc/Almatis_StipGSO.pdf About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Almatis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ALMATIS BV: Receives Court's Approval to Pay Contractors -------------------------------------------------------- Almatis B.V. and its affiliated debtors obtained a final order from the Court authorizing them to pay the pre-bankruptcy claims of their contractors, distributors and warehousemen in the sum of $2 million. Any contractor, distributor or warehouseman that receives payment of claims is required to continue to extend customary trade credit and provide other business terms; is not allowed to file and record in any jurisdiction, or assert against the Debtors, their estates and properties, a lien or security interest relating in any manner to the claims already paid; and is required to return goods or other assets in which the Debtors have an interest. Almatis B.V. and its debtor affiliates sought and obtained final U.S. Court approval to pay the pre-bankruptcy claims of their contractors, distributors and warehousemen. The Debtors owe their Service Providers about $2 million in fees and charges for services rendered as of April 30, 2010. The services provided include maintenance and repair, and transportation, distribution and storage of the Debtors' raw materials and finished products. Michael Rosenthal, Esq., at Gibson Dunn & Crutcher LLP, in New York, said that through the proposed payment, the service providers won't have any reason to assert liens against the Debtors' goods or refuse to release those goods that are in their custody. The estimated value of the goods that are in the possession of the service providers reportedly exceeds $2 million. The payment of claims comes with a number of conditions: (1) the service provider has possession of and control over goods in which the Debtors have interest; (2) the service provider agrees to release the goods at its sole cost and expense; and (3) the payment must be made with reservation of rights regarding the extent, validity, perfection or possible avoidance of any liens and interests of the service provider. In connection with the payment of claims, the Court authorized the Debtors' banks and other financial institutions to honor checks and transfers related to the service providers' prepetition claims. About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Almatis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ALMATIS BV: Wins U.S. Court's Nod to Pay Foreign Creditor Claims ---------------------------------------------------------------- Almatis B.V. and its affiliated debtors sought and obtained Final approval from the U.S. Bankruptcy Court to earmark as much as $23 million to pay the pre-bankruptcy claims of their foreign creditors. The claims are on account of goods and services provided by the Foreign Creditors for the production and transportation of specialty alumina products for the Debtors' customers located throughout the world. The creditors include suppliers, brokers, and duty collectors, among others. The Debtors proposed to pay their Foreign Creditors to prevent the latter from withholding goods, asserting liens or terminating service agreements or other actions detrimental to the Debtors' operations, according to Michael Rosenthal, Esq., at Gibson Dunn & Crutcher LLP, in New York. Mr. Rosenthal said that several of the Foreign Creditors are not likely to be subject to the jurisdiction of the U.S. Bankruptcy Court, which oversees the Debtors' Chapter 11 cases. "Foreign creditors may consider themselves to be beyond the jurisdiction of this Court, disregard the automatic stay and engage in conduct that disrupts the Debtors' domestic and international operations." Judge Glenn also authorized the Debtors' banks and other financial institutions to honor checks and transfers in relation to the Foreign Creditor Claims payment. In addition to the payment of the Foreign Creditors' claims, the Debtors also obtained Court approval to continue a volume purchase rebate program and pay all pre-bankruptcy claims outstanding under that program. Under the Rebate Program, the Debtors provide bulk rebates to about 10 customers, which may qualify as foreign creditors, in the form of a credit that may be applied against additional orders. The cost of maintaining the Program will not exceed EUR200,000 for 2010 based on the Debtors' estimate. In connection with the Program, the Court also authorized the Debtors to reconcile accounts with suppliers and customers in the ordinary course of their businesses regardless of the prepetition or postpetition nature of any debit or credit involved in the reconciliation. About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Almatis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) AMBRILIA BIOPHARMA: Closes Initial Phase of a Transaction --------------------------------------------------------- Ambrilia Biopharma Inc. disclosed that, as a result of the closing of the initial phase of the transaction disclosed on May 26, 2010, Ambrilia and its subsidiary Cellpep Pharma Inc. have obtained today non-dilutive financing of approximately $2M. Ambrilia still has the possibility of obtaining an additional amount of approximately $2M, subject to the exercise of an option by a third party, such option expiring on September 30, 2010. The above amounts are before expenses. There is no assurance that the option held by a third party will be exercised. Ambrilia has been operating under the protection of the Companies' Creditors Arrangement Act Canada ("CCAA") since July 31, 2009. Any recovery for creditors and other stakeholders, including shareholders, is uncertain and is highly dependent upon a number of factors, including the outcome of Ambrilia proceedings under the CCAA. About Ambrilia Biopharma Ambrilia Biopharma Inc. is a biotechnology company focused on the discovery and development of novel treatments for viral diseases and cancer. The Company's strategy aims to capitalize on its broad portfolio and original expertise in virology. Ambrilia's product portfolio is comprised of oncology and antiviral assets, including two new formulations of existing peptides for cancer treatment, a targeted delivery technology for cancer, an HIV protease inhibitor program as well as HIV integrase and entry inhibitors, Hepatitis C virus inhibitors and anti-Influenza A compounds. Ambrilia's head office is located in Montreal. The Company is currently subject to court protection under the CCAA. CALPINE CORPORATION: Moody's Puts 'B1' Rating on $400 Mil. Notes ---------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Calpine Corporation's (B1 Corporate Family Rating) $400 million 8% senior secured notes due 2019. The rating outlook for Calpine is stable. Proceeds from the offering were used to repay a portion of the debt outstanding under the company's senior secured term loan reducing the amount of the secured term loan that matures in March 2014 by $394 million to approximately $4.231 billion. Calpine has stated publicly that it plans to refinance the secured term loan prior to its 2014 maturity, targeting a debt maturity profile that results in approximately $2 billion or less in corporate maturities in any given year. Calpine began implementing this refinancing strategy in November 2009 with a $1.2 billion 7.25% senior secured note offering due 2017 and the completion of this $400 million financing is a continuation of that strategy. The B1 Corporate Family Rating 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 planned Conectiv Energy asset purchase, and from expected contributions from new projects and new contracts entered into with a number of end-use customers. The rating considers the company's hedging program, a favorable environmental profile, the scheduled amortization of various subsidiary level financings, and the sustained operating performance of the generation fleet. For the 12 months ending March 31, 2010, Moody's calculate the ratio of Calpine's cash flow (CFO-pre W/C) to debt at 8.4%, its cash flow coverage of interest at 2.0x and its free cash flow to debt at 7.6%. For more information on Calpine, please refer to the Credit Opinion dated May 6, 2010 which can be found on www.moodys.com under the issuer's name. The B1 rating assigned to the senior secured notes reflects the pari-passu first lien collateral position of note holders relative to the company's existing secured revolver and term loan (rated B1) lenders. Moody's observes that while the first lien secured note holders share in the collateral on a pari-passu basis, note holders have limits placed on their voting rights in certain circumstances until such time as the RC and term loan has been reduced to less than $500 million. While these limitations serve to weaken note holders' position relative to the RC and term loan lenders, it is not considered material enough to warrant a different rating on the notes. The stable rating outlook reflects Moody's expectation for continued 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 consolidated debt reduction. In light of the company's recent rating upgrade on May 5, limited prospects exist for the rating to be upgraded in the near-term. Calpine's CFR could be upgraded if the company's ratio of free cash flow to debt reaches the high single digits, its cash flow to debt exceeds 12%, and cash coverage of interest expense is above 2.3x on a sustainable basis, The rating could be downgraded if the company is not able to continue executing on its current business plan through strong plant performance and a carefully implemented hedging strategy that results in free cash flow generation which facilitates consolidated debt reduction. Specifically, Calpine's CFR could be downgraded if the company's cash flow to debt drops below 7%, and its cash coverage of interest expense falls below 1.8x. Moody's last rating action on Calpine occurred on May 5, 2010 when Calpine's ratings were upgraded, including the Corporate Family Rating to B1 from B2. The rating for Calpine's senior secured notes were determined using Moody's Loss Given Default methodology. Based upon Calpine's B1 CFR and PDR, the LGD methodology suggests a B1 rating for Calpine senior secured notes. Assignments: Issuer: Calpine Corporation -- Senior Secured Regular Bond/Debenture, Assigned a range of 50 - LGD4 to B1 Headquartered in Houston, Texas, Calpine is a major U.S. independent power company with assets of $17.5 billion at March 31, 2010. With the expected completion of the Conectiv acquisition, Calpine will have aggregate generating capacity of 28,297 MW. AMERICAN INT'L: Says Taxpayers Will Get Money Back -------------------------------------------------- American International Group Inc. Chief Executive Officer Robert Benmosche said that the insurer, recipient of a $182.3 billion bailout, will return rescue funds with interest. "I'm confident you'll get your money, plus a profit," Mr. Benmosche told the Congressional Oversight Panel in Washington. "We are a strong, vibrant company." The insurer will repay a Federal Reserve credit line after the sales of two non-U.S. life insurance divisions are completed this year for about $51 billion and then turn to Treasury Department obligations, Mr. Benmosche said. AIG posted net income of $1.45 billion in the first quarter and raised money for its plane-leasing unit in the private market for the first time since its rescue in 2008. About AIG Inc. Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. AMERICAN INT'L: Senior Execs to Get LTPU-Based Stock Salaries ------------------------------------------------------------- American International Group, Inc., disclosed in its Proxy Statement for its 2010 Annual Meeting of Shareholders that the Determination Memorandum issued by the Office of the Special Master for TARP Executive Compensation on March 23, 2010, permits AIG to pay 2010 stock salary to its top 25 most highly compensated employees in the form of units based on a basket of AIG common stock and debt securities designed to serve as a proxy for AIG's long-term value. On May 28, 2010, final terms for these units, which are now referred to as Long-Term Performance Units, or LTPUs, were approved and AIG determined to pay 2010 stock salaries in LTPUs for a group of senior employees including named executive officers David L. Herzog, Kristian P. Moor, Rodney O. Martin, Jr. and Nicholas C. Walsh. The LTPU-based stock salaries will be settled in cash on the dates required by the Determination Memorandum, will be effective from January 1, 2010, and will replace any stock salary previously earned by these employees in 2010. In accordance with the Determination Memorandum, Robert H. Benmosche will continue to receive stock salary on the terms specified in his letter agreement. In addition, and in accordance with the Determination Memorandum, the rates of 2010 stock salaries for Messrs. Martin and Walsh will be reduced to $3,630,000 and $4,525,000, respectively, to reflect the additional cash salary earned by these employees in 2010 prior to the implementation of the approved cash salary rates specified in the Determination Memorandum. About AIG Inc. Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. AMERICAN INT'L: To Divest AIA as 'Quickly as Possible' ------------------------------------------------------ Bloomberg News reports that American International Group Inc. Chief Executive Officer Robert Benmosche said he plans to divest the company's main Asia unit as soon as the insurer has an acceptable alternative to Prudential Plc. "We will have several options to consider regarding AIA -- more than we did in March," Benmosche, 66, said June 1 in a letter to employees of New York- based AIG. Prudential had asked AIG to sell AIA Group Ltd. for less than the $35.5 billion the companies agreed to in March. AIG, however, said in a statement that, after careful consideration, it will adhere to the original terms of its previously announced agreement for Prudential to acquire AIG's wholly owned pan-Asian life insurance subsidiary AIA Group Limited. AIG said it will not consider revisions to those terms. The Wall Street Journal has reported that that Prudential, on the other hand, said it is considering its position after AIG rejected a proposal to slash the value of the deal to $30.375 billion. Bloomberg reported May 31 that AIG remains in negotiations to salvage the sale of AIA Group. Prudential asked that the $35.5 billion price for AIA be cut to about $29 billion to $30 billion, and AIG is seeking at least $32 billion, said a person with knowledge of the talks who declined to be identified because they are private. About the AIA The AIA Group is a pan-Asian life insurance organization that traces its roots in the Asia Pacific region back more than 90 years. It provides consumers and businesses with products and services for life insurance, retirement planning, accident and health insurance as well as wealth management solutions. Through an extensive network of 320,000 agents and 23,500 employees across 15 geographical markets, AIA serves more than 23 million customers in the region. About AIG Inc. Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. ANGIOTECH PHARMACEUTICALS: To Hold Shareholders Meeting on July 29 ------------------------------------------------------------------ Angiotech Pharmaceuticals Inc. will hold its 2010 annual and special general meeting of shareholders on July 29, 2010 at 10:00 a.m. Pacific time, at the Westin Grand Vancouver, 403 Robson Street, Vancouver, BC V6B 6L9. The record date for shareholders entitled to receive notice of and vote at the meeting will be June 7, 2010, and the company expects to mail the meeting materials to shareholders on or about June 21, 2010. About Angiotech Pharmaceuticals Vancouver, Canada-based Angiotech Pharmaceuticals, Inc. (NASDAQ: ANPI, TSX: ANP) -- http://www.angiotech.com/-- is a global specialty pharmaceutical and medical device company. Angiotech discovers, develops and markets innovative treatment solutions for diseases or complications associated with medical device implants, surgical interventions and acute injury. * * * Angiotech Pharmaceuticals carries 'CCC' corporate credit ratings from Standard & Poor's. ANTOINE WALKER: Eyes NBA Comeback to Repay Debts ------------------------------------------------ Eric Morath at Dow Jones' Daily Bankruptcy Review, citing the Louisville Courier-Journal, reports that former National Basketball Association star Antoine Walker is said to be plotting a return to the National Basketball Association and was spotted working out at the University of Louisville, where his former coach Rick Pitino now coaches. The report notes a return to the NBA could help Mr. Walker repay creditors, including a long list of mortgage lenders and a pair of casinos. The report further notes the minimum NBA salary for a veteran player like Mr. Walker is more than $1.3 million. The report adds that Mr. Walker said on his bankruptcy filing that he currently has no source of income but has more than $70,000 in monthly expenses. Mr. Walker made more than $110 million during his 12-year NBA career. As reported by the Troubled Company Reporter, former NBA star Antoine Walker filed for Chapter 7 bankruptcy in Miami, Florida, on May 18, 2010, listing four pieces of real estate including a $2 million plus Miami home that is underwater with a mortgage of over $3 million and some other properties in Chicago. Mr. Walker sought bankruptcy protection after facing a $2.3 million foreclosure lawsuit on his mother's mansion in Tinley Park's Tony Odyssey Club, according to a report by Beck Schlikerman at SouthtownStar. The foreclosure lawsuit for the Tinley Park home was filed by Northern Trust five days before the bankruptcy in Cook County. It alleges that Mr. Walker has not paid the mortgage on the home in at least three months. Mr. Walker, who played professional basketball for the Miami Heat and the Boston Celtics, listed assets of $4.2 million and $12.7 million in liabilities. Mr. Walker owes about $70,000 in back property taxes on the home. AUTOBACS STRAUSS: Again Revising Reorganization Plan ---------------------------------------------------- Autobacs Strauss Inc. won't proceed with taking their plan, which already has its disclosure statement approved, for confirmation at a hearing scheduled for June 21. The Company and the Official Committee of Unsecured Creditors decided that further changes in the plan are necessary. They therefore aren't soliciting votes from creditors. The previous iteration of the plan promised a recovery of up to 65% recovery to unsecured creditors with claims aggregating $18.7 million. If the group didn't recover at least 45%, creditors would have ended up owning all the new stock. If the 45% threshold were met, Chief Executive Officer Glenn Langsberg was to have an option to buy all the stock for $300,000. To avoid competing plans, Strauss filed a motion for a two-month extension until June 24 of the exclusive right to propose a plan. The exclusivity hearing will be held June 16. About Autobacs Strauss Headquartered in South River, New Jersey, Autobacs Strauss Inc. -- http://www.straussauto.com/-- sells after-market automotive parts and accessories, and operate automotive service centers located in New York, New Jersey, Philadelphia, Bethlehem and Pennsylvania. The Company operates 86 retail store locations and has about 1,450 employees. The Company filed for Chapter 11 protection on February 4, 2009 (Bankr. D. Del. Case No. 09-10358). Edward J. Kosmowski, Esq., at Young Conaway Stargatt & Taylor, LLP, represents the Debtor in its restructuring efforts. As of January 3, 2009, the Debtor had total assets of $75,000,000 and total debts of $72,000,000. The Chapter 11 case is Strauss's third. The preceding Chapter 11 case ended with confirmation of a Chapter 11 plan in April 2007. The Company was then named R&S Parts & Service Inc. BANK OF FLORIDA: Posts $48.2 Million Net Loss in Q1 2010 -------------------------------------------------------- Bank of Florida Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $48.2 million on $8.0 million of net interest income (before provision for loan losses) for the three months ended March 31, 2010, compared with a net loss of $4.4 million on $9.6 million of net interest income (before provision for loan losses) for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $1.476 billion in assets and $1.482 billion of liabilities, for a stockholders' deficit of $5.8 million. As reported in the Troubled Company Reporter on March 15, 2010, Porter Keadle Moore, LLP, in Fort Myers, Florida, 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 of the Company's recurring operating losses and the continued deterioration of the Company's loan portfolio. As of March 31, 2010, each of the Company's three subsidiary banks was "critically undercapitalized" under Federal Deposit Insurance Corporation rules. In addition, the FDIC has issued to each bank a Prompt Corrective Action Directive which required each bank to return to "adequately capitalized" condition by April 17, 2010; none of the banks met this deadline. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63d2 Subsequent Events On May 28, 2010, the Company's principal operating subsidiaries Bank of Florida - Southwest, Bank of Florida - Southeast and Bank of Florida - Tampa Bay, were closed by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation as receiver of the Bank. Subsequent to the closure, EverBank, Jacksonville, Florida, assumed the operations and all of the deposits of the Banks, and purchased essentially all of the Banks' assets in a loss-share transaction facilitated by the FDIC. Beginning on June 1, 2010, the 13 offices of the Banks reopened as branches of EverBank. The Company continues to own and operate Bank of Florida Trust Company. About Bank of Florida Corporation Naples, Fla.-based Bank of Florida Corporation. (Nasdaq: BOFL) -- http://www.bankofflorida.com/-- is a multi-bank holding company. The Company is the parent company for Bank of Florida - Southwest in Collier and Lee Counties; Bank of Florida - Southeast in Broward, Miami-Dade and Palm Beach Counties; Bank of Florida - Tampa Bay in Hillsborough and Pinellas Counties; and Bank of Florida Trust Company. BEAZER HOMES: Completes $300 Million Senior Notes Offering ---------------------------------------------------------- Beazer Homes USA Inc. completed an underwritten offering of $300 million aggregate principal amount of its 9.125% senior notes due June 15, 2018, pursuant to an Underwriting Agreement dated May 4, 2010, with Credit Suisse Securities (USA) LLC and Citigroup Global Markets Inc. The Company issued the Notes under an Indenture, dated as of April 17, 2002, as supplemented by the Thirteenth Supplemental Indenture, dated as of May 20, 2010, among the Company, the Guarantors and U.S. Bank National Association, as trustee. The Notes and the guarantees will be the Company's and the Guarantors' unsecured senior obligations and will rank equally with all of the Company's and the Guarantors' other unsecured senior indebtedness. The Supplemental Indenture contains covenants which, subject to certain exceptions, limit the ability of the Company and its restricted subsidiaries to, among other things, incur additional indebtedness, make certain types of restricted payments, and create liens on assets of the Company or the Guarantors. Upon a change of control, the Company is required to make an offer to repurchase the Notes at 101% of their principal amount, plus accrued and unpaid interest. The Supplemental Indenture also contains customary events of default. The Notes will accrue interest at a rate of 9.125% per year, which will be payable on June 15 and December 15 of each year, commencing on June 15, 2010. The Notes will mature on June 15, 2018. The Company may redeem some or all of the Notes at any time prior to June 15, 2014 at a price equal to 100% of the principal amount of the Notes redeemed, plus accrued and unpaid interest to the redemption date and a "make-whole" premium as described in the Supplemental Indenture. Thereafter, the Company may redeem some or all of the Notes at the redemption prices specified in the Supplemental Indenture. In addition, prior to June 15, 2013, the Company may redeem up to 35% of the Notes from the proceeds of certain equity offerings at the specified redemption price. About Beazer Homes Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/-- headquartered in Atlanta, is one of the country's 10 largest single-family homebuilders with continuing operations in Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New Mexico, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol "BZH." The Company's balance sheet at March 31, 2010, showed $2.02 billion in total assets and $1.67 billion in total liabilities for a $353.15 million total stockholders' equity. On May 4, 2010, Standard & Poor's Ratings Services raised its corporate credit rating on Beazer Homes USA Inc. to 'B-' from 'CCC+'. At the same time, S&P raised its rating on the company's second-lien notes to 'B' from 'B-', and S&P raised its rating on the company's senior unsecured and subordinated convertible notes to 'CCC' from 'CCC-'. S&P also assigned its 'CCC' rating to the company's proposed $300 million senior unsecured notes due 2018. S&P revised its outlook to stable from positive. Moody's Investors Service raised the ratings of Beazer Homes USA, Inc., including its corporate family rating and probability of default rating to Caa1 from Caa2. At the same time, Moody's assigned a Caa2 rating to the company's new $300 million of senior unsecured notes due 2018, proceeds of which will be used for debt repurchases, including a call of notes due in 2012, and affirmed the ratings on the company's senior secured notes at B1 and existing senior unsecured notes at Caa2. The speculative grade liquidity rating is also affirmed at SGL-3. The outlook is revised to stable from negative. BIOLIFE SOLUTIONS: Reports $513,000 Revenue for 1st Qtr of 2010 --------------------------------------------------------------- BioLife Solutions Inc.'s chairman and chief executive officer Mike Rice reported record revenue of $513,000 for the first quarter of 2010, an increase of 36% over the first quarter of last year. Mr. Rice said this revenue increase demonstrates the Company's ability to acquire new customers in its target markets and to drive continued growth from its existing customer base. The value of the Company's proprietary GMP grade biopreservation media products is being recognized by a growing number of potential high-value customers that are seeking clinical grade reagents of the highest quality and preservation efficacy, he added. Bothell, Washington-based BioLife Solutions, Inc. develops and markets patented hypothermic storage and cryopreservation solutions for cells, tissues, and organs, and provides contracted research and development and consulting services related to optimization of biopreservation processes and protocols. * * * According to the Troubled Company Reporter on April 8, 2010, Peterson Sullivan LLP, in Seattle, Washington, in its March 30, 2010 report, said BioLife Solutions, Inc. has been unable to generate sufficient income from operations to meet its operating needs. Additionally, the Company used $2.4 million in cash for operating activities during the year ended December 31, 2009, and has an accumulated deficit of $50 million at December 31, 2009. These conditions raise substantial doubt about the Company's ability to continue as a going concern. CAPMARK FIN'L: Proposes Angelo-Led Loan Auction; EastBanc Objects ----------------------------------------------------------------- Capmark Corporation and its debtor affiliates ask the U.S. Bankruptcy Court for the District of Delaware to issue: (i) a bidding procedures order (a) scheduling an auction at which Debtor Capmark Finance Inc. will solicit competing bids for the sale of its ownership interest in a loan in the original principal amount of $70,400,000 made to Georgetown Park Partners, LLC, together with accompanying loan file; (b)approving certain bidding procedures; (c) approving a break-up fee and expense reimbursement for the stalking horse bidder as protection against a competing bid; scheduling a hearing to consider approval of the Sale of the Georgetown Loan to the stalking horse bidder or to another successful bidder at the auction; (e) establishing a deadline by which any objection to the Sale must be filed; and approving the proposed form and manner of notice of the Auction and Sale Hearing; and (ii) upon the completion of the Sale Hearing, an order approving the Sale of the Georgetown Loan to a stalking horse bidder or to another successful bidder, free and clear of any and all liens, claims, encumbrances, and interest. The Georgetown Loan relates to debt financing provided by the Debtor to Georgetown Park Partners, LLC, the borrower, in connection with the ownership of the Georgetown shopping mall and office complex, located in Washington, D.C. Debtor Capmark Finance has entered into a Loan Purchase and Sale Agreement, dated as of May 10, 2010, with Angelo Gordon Real Estate Inc. whereby Angelo Gordon has agreed to purchase the Georgetown Loan from the Debtor, and to act as "stalking horse" in the Debtor's pursuit of higher of better offers. The Salient terms of the Purchase Agreement are: Purchase Price: $53,000,000 Additional In addition to the Purchase Price, the Consideration : Purchase Agreement provides the Debtor with protection from claims by the Borrower Parties. Pursuant to the Settlement to be entered into at closing, certain of the Borrower Parties are releasing the Debtor and its affiliates from claims, and the proofs of claim filed by certain of the Borrower Parties against the Debtor and Capmark Investments LP will be withdrawn with prejudice. As further protection, under the Purchase Agreement, Angelo Gordon has agreed to indemnify the Debtor and its affiliates from claims by the Borrower Parties of up to $3.3 million. Break-Up Fee and Expense Reimbursement: The Debtor will pay to Angelo Gordon a break-up fee for $1,340,000 following the termination of the Purchase Agreement. Closing Date: The closing will occur at 10:00 a.m. on the date that is the first business day following the passing of three business days after the entry of the Sale Order; provided that (i) no appeal has been made during that three business day period challenging the finding by the Bankruptcy Court that the Purchaser is a "good faith" purchaser under Section 363(m) of the Bankruptcy Code, and (ii) as of the Closing Date, the Sale Order (x) has not been revoked or modified in any manner materially adverse to the Purchaser without the Purchaser's consent, and (y) is not subject to a stay. Proposed Settlement Georgetown Park and WDC Georgetown Park Manager LLC, the managing member of Georgetown Park Partners, each filed proofs of claim against CFI and CILP. The claims assert damages of $19.2 million for breach of contract, breach of the covenant of good faith and fair dealing, promissory estoppels and detrimental reliance, breach of fiduciary duty, breach of duty of loyalty, clogging the equity of redemption, equitable subordination, recoupment and set-off. The claims are also asserted as defenses to the enforcement of the Georgetown Loan. The claims consists of $3 million of a forfeited deposit under a loan purchase contract and $16.2 million as compensation for the difference between the purchase price under the loan purchase contract and balance due on the Georgetown Loan. The Purchase Agreement contemplates a Settlement through the release agreements that would be executed and delivered at the closing of the Sale. Pursuant to the Release Agreement, WDC Holdings, LLC, WDC Georgetown Manager, WDC Georgetown Park, LLC, and Herbert Miller are releasing CFI and its affiliates, including CILP from all claims. In addition, at closing of the Sale to Angelo Gordon as Purchaser, the Borrower and WDC Georgetown Manager will withdraw with prejudice their proofs of claim against the Debtors. It is contemplated that the Settlement will only be consummated in connection with the closing of the Sale to Angelo Gordon, and will not be consummated in connection with the closing of the Sale to a Successful Bidder who is not Angelo Gordon. The Purchase Agreement provides that the Purchaser will provide a $3.3 million indemnification to CFI and its affiliates in respect of claims asserted by the Borrower Parties. Bidding Procedures and the Auction To maximize the value of the Georgetown Loan, the Debtors seek to implement a competitive bidding process for the Sale of the Georgetown Loan to solicit higher or better offers in an orderly and efficient manner. The proposed Auction and Bidding Procedures are: Any person or entity interested in participating in the Auction must submit a qualifying bid on or before June 14, 2010, at 12:00 p.m. in writing to: (i) counsel to the Debtors Dewey & LeBoeuf LLP 1301 Avenue of Americas, New York New York 10019 Attn: Michael P. Kessler, Esq., and Judy G.Z. Liu, Esq. (ii) corporate counsel to the Seller Kaye Scholer LLP 425 Park Avenue, New York New York 10022 Attn: Louis J. Hait, Esq., and Benjamin Mintz, Esq. (iii) Capmark Finance Inc. 485 Madison Avenue, New York New York 10022 Attn: Jonathan Kohan; and (iv) counsel to the Official Committee of Unsecured Creditors Kramer Levin Naftalis & Frankel LLP 1177 Avenue of the Americas, New York New York 10036 Attn: Thomas Moers Mayer, Esq. and Joshua Brody, Esq. To participate in the bidding process and be deemed a "Qualifying Bidder," each potential bidder must submit a Qualifying Bid by the Bid Deadline. The Purchase Agreement is deemed a Qualifying Bid and Purchaser is deemed a Qualifying Bidder. Otherwise, to constitute a Qualifying Bid, a bid must: (a) Be in writing and state that the bidder is prepared to enter into a legally binding purchase and sale agreement or similar agreement for the acquisition of the Georgetown Loan on aggregate terms and condition no less favorable to the Seller than the terms and conditions contained in the Purchase Agreement, and with a cash purchase price of no less than the Purchaser's Purchase Price plus the Break-Up Fee, the Expense Reimbursement, and $500,000; provided that a Qualifying Bid need not include a release in favor of Seller from Borrower Entities; (b) Have a purchase price consisting only of cash; (c) Provide details of any assumptions about the transaction that are key to the purchase price; (d) Include a mark-up of the Purchase Agreement reflecting the variations from the Purchase Agreement, and a clean and executed Modified Purchase Agreement; (e) Otherwise include terms and conditions substantially the same in all respects to the Purchase Agreement; (f) Provide that the bidder's offer is irrevocable until the closing of the purchase of the Georgetown Loan if the bidder is the Successful Bidder or the Back-Up Bidder including, without limitation, without regard to whether the Borrower under the Georgetown Loan becomes the subject of a bankruptcy proceeding; (g) State that bidder is financially capable of consummating the transactions contemplated by the Modified Purchase Agreement, and that there are no financing, due diligence, or other material contingencies for the bidder to consummate the Modified Purchase Agreement; (h) Provide that bidder will close on the sale of the Georgetown Loan within the same time period provided for in the Purchase Agreement; (i) Include financial and other information that will allow the Seller to make a reasonable determination as to the bidder's financial and other capabilities to consummate the transactions contemplated by the Modified Purchase Agreement; (j) Include a statement that there are no conditions precedent to the bidder's ability to enter into a definitive agreement and that all necessary internal shareholder approvals have been obtained prior to the bid; (k) Not request or entitle the bidder to any transaction or break-up fee, termination fee, expense reimbursement, or similar type of payment; (l) Fully disclose the identity of each entity that will be bidding for the Georgetown Loan or otherwise participating in connection with that bid, and the complete terms of any participation; (m) Include any other information or factors that may be relevant to the Seller and its advisors in consideration of the bid; and (n) Include a cash deposit by wire transfer equal to $10,000,000 with that deposit being non-refundable on terms consistent with those set forth in the Purchase Agreement. If no timely, confirming Qualifying Bids, other than the Purchase Agreement, are submitted by the Bid Deadline, the Debtor will not hold an auction and, instead will request at the Sale Hearing that the Court approve the Purchase Agreement with the Proposed Purchaser. In the event the Seller timely receives one or more Qualifying Bids other than the Purchase Agreement, the Seller will conduct the Auction with respect to the Georgetown Loan. The Auction will be held at the offices of Kaye Scholer LLP 425 Park Avenue, New York, New York 10022, on June 16, 2010, at 10:00 a.m. The Debtors request that any objection to the Sale or Settlement be filed on or before June 18, 2010. A full-text copy of the Purchase Agreement is available for free at http://bankrupt.com/misc/Capmark_AngeloAgmt.pdf EastBanc Objects EastBanc, Inc. asserts that the stalking horse-bid contains a hefty break-up fee that appears unnecessary to preserve value to the estate and would instead divert money away from the estate to the purchaser. EastBanc adds that the contract contains several elaborate provisions that are purportedly designed to settle claims that Herbert Miller and his related entities have asserted against Capmark Finance, Inc. in proofs of claim, as well as other potential claims that Mr. Miller and other related entities may have against Capmark Finance. EastBanc relates that it has controlled the right to purchase the shops at Georgetown Park through a contract with Mr. Miller. But in 2006, EastBanc notes, Mr. Miller breached the contract, and in 2007, he purchased the Mall for himself through an affiliated entity -- Georgetown Park Partners, LLC. According to EastBanc, Capmark Finance is deeply involved in GPP's acquisition of the Mall. EastBanc asserts that the procedures proposed in the Motion and the stalking-horse bid will discourage potential bidders from participating in the auction, thereby undermining the whole purpose of the auction. "If the Debtors' goal is actually to maximize value to the estate, then the Debtors must even the playing field and allow a competitive process to govern the sale of the Mall Loan," counsel for EastBanc, Christopher P. Simon, Esq., at Cross & Simon, LLC, in Wilmington, Delaware -- csimon@crosslaw.com -- says. EastBanc says its objection to the Motion arises out of its longstanding effort to purchase the Mall that acts as security for the Mall Loan. In a declaration filed with the Court in support of EastBanc's objection, Anthony Lanier, president of EastBanc, asserts that the bid procedures proposed by the Debtors make it difficult, if not impossible, for EastBanc to compete fairly in an auction for the loan. Mr. Lanier avers that if the auction were conducted on a level playing field, with all bids, including the stalking- horse bid, made on a cash-only basis, EastBanc would be an active participant in the bidding. Debtors Seek Leave to File Reply to Eastbanc's Objection The Debtors seek the Court's authority to file a late reply to Eastbanc's objection to the Motion. The Debtors maintain that the Proposed Bidding Procedures is designed to maximize the value of the Georgetown Loan in an orderly and fair manner. The Debtors note that the Break-Up Fee and Expense Reimbursement detailed in the Sale Motion and Purchase Agreement are integral to the process and are actual and necessary costs of preserving their estate. The Debtors aver that the Bidding and Auction Procedures are also fair and reasonable. They expressly provide that any bidder, including EastBanc, is not required to provide in its bid any release, the Debtors add. J. Kohan Files Affidavits Jonathan B. Kohan, vice president/Senior Asset Manager of Debtor Capmark Finance Inc., filed with the Court an affidavit in support of the Debtors' request for approval of the Sale Motion. Mr. Kohan said that: (i) the Debtor's entry into the Loan Purchase and Sale Agreement, dated as of May 10, 2010, with Angelo Gordon Real Estate Inc., whereby Angelo Gordon has agreed to purchase the Georgetown Loan from the Debtor, on certain terms and conditions, and to act as a "stalking horse" in the Debtor's pursuit of higher or better offers, was a sound business judgment; and (ii) the Break-up Fee and Expense Reimbursement are actual and necessary costs of preserving the Debtor's estate. In a separate supplemental affidavit, Jonathan B. Kohan, vice president of Debtor Capmark Finance Inc., tells the Court that the Purchase Agreement with Angelo Gordon as the stalking horse bidder is the best overall offer CFI has obtained thus far for the Georgetown Loan. "Notwithstanding that EastBanc will have another opportunity to bid on the Georgetown Loan pursuant to the proposed Bidding Procedures Order, I believe EastBanc now seeks to 'blow up' the proposed sale to Angelo Gordon by seeking this Court's denial of Angelo Gordon's Break-Up Fee and posting vague accusations of conflicts of interest and bad faith, all of which are incorrect," Mr. Kohan asserts. According to Mr. Kohan, approval of the Break-Up Fee and Expense Reimbursement will not chill bidding. About Capmark Financial Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- is a diversified company that provides a broad range of financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. Capmark has 1,000 employees located in 37 offices worldwide. On October 25, 2009, Capmark Financial Group Inc. and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 (Bankr. D. Del. Case No. 09-13684) Capmark's financial advisors are Lazard Freres & Co. LLC and Loughlin Meghji + Company. Capmark's bankruptcy counsel is Dewey & LeBoeuf LLP. Richards, Layton & Finger, P.A., serves as local counsel. Beekman Advisors, Inc., is serving as strategic advisor. KPMG LLP is tax and accounting advisor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. Capmark has total assets of US$20 billion against total debts of US$21 billion as of June 30, 2009. Bankruptcy Creditors' Service, Inc., publishes Capmark Financial Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Capmark Financial Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) CAPMARK FIN'L: Proposes Deloitte as Tax Advisor ----------------------------------------------- Capmark Financial Inc. and its units seek the Court's authority to employ Deloitte Tax LLP as their tax advisor, nunc pro tunc to April 17, 2010. The Debtors have selected Deloitte Tax because of the firm's diverse experience and extensive knowledge in the fields of taxation for large sophisticated companies both in Chapter 11 as well as outside of Chapter 11. As the Debtors' tax advisors, Deloitte Tax will, among others, provide: (a) analysis of federal and state net operating loss preservation, including periodic updates to prior Section 382 analyses; (b) tax compliance services as set forth in the Work Order dated May 10, 2010; (c) federal, state, and employee benefit tax compliance services; (d) federal, state, and international tax advisory services, including advice related to accounting methods, periods, elections or credits; (e) federal and state tax controversy services, including assistance in responding to audits performed by federal and state administrations; (f) intercompany transfer pricing analyses, including periodic updates to prior transfer pricing studies; and (g) assistance with the preparation of specified tax forms for certain of the Debtors' employee benefit plans. The Debtors will pay Deloitte Tax based on the firm's current hourly rates: Classification Hourly Rate -------------- ----------- Partner/Principal/Director $550 Senior Manager $450 Manager $350 Senior $250 Staff $190 Under the February Engagement Letter, Deloitte Tax intends to charge $3,500 for the preparation of the specified tax forms plus expenses and technology costs. The Debtors will also reimburse Deloitte Tax for its expenses, including travel, report production, delivery services, and other expenses incurred in providing professional services. Jeffrey Ausnehmer, partner of Deloitte Tax LLP, assures the Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. * * * The Debtors certified to the Court that no objections were filed as to the Application. About Capmark Financial Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- is a diversified company that provides a broad range of financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. Capmark has 1,000 employees located in 37 offices worldwide. On October 25, 2009, Capmark Financial Group Inc. and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 (Bankr. D. Del. Case No. 09-13684) Capmark's financial advisors are Lazard Freres & Co. LLC and Loughlin Meghji + Company. Capmark's bankruptcy counsel is Dewey & LeBoeuf LLP. Richards, Layton & Finger, P.A., serves as local counsel. Beekman Advisors, Inc., is serving as strategic advisor. KPMG LLP is tax and accounting advisor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. Capmark has total assets of US$20 billion against total debts of US$21 billion as of June 30, 2009. Bankruptcy Creditors' Service, Inc., publishes Capmark Financial Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Capmark Financial Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) C-N-D INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: C-N-D Industries Inc. 4520 Southway Avenue SW Canton, OH 44706 Bankruptcy Case No.: 10-62363 Chapter 11 Petition Date: May 29, 2010 Court: U.S. Bankruptcy Court Northern District of Ohio (Canton) Judge: Russ Kendig Debtor's Counsel: Anthony J. DeGirolamo, Esq. 116 Cleveland Avenue, N.W., Suite 307 Canton, OH 44702 Tel: (330) 588-9700 Fax: (330) 588-9713 E-mail: ajdlaw@sbcglobal.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 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ohnb10-62363.pdf The petition was signed by Clyde Shetler, president. CATHOLIC CHURCH: Alaska Diocese Amends Suit vs. CMRSA ----------------------------------------------------- The Catholic Bishop of Northern Alaska amended its complaint against Defendants Catholic Mutual Relief Society of America, and Traveler's Casualty and Surety Company, formerly known as Aetna Casualty and Surety Company. Susan G. Boswell, Esq., at Quarles & Brady LLP, in Tucson, Arizona, contends that a comprehensive declaratory judgment action involving CBNA and all of CBNA's primary and excess insurers is necessary to ensure that there will not be potentially inconsistent scope of coverage adjudications, which might occur were there to be separate adjudications of the same scope of coverage issues between CBNA and one or more, but less than all, of CBNA's primary and excess liability insurers. Ms. Boswell asserts that there is a current justifiable case and controversy between the Diocese and all of the Defendants with regard to the scope of coverage available to CBNA under the Defendants' various insurance policies and insurance certificates with regard to the claims of abuse claimants, as to the scope of the Defendants' defense and indemnity coverage obligations. Accordingly, the Diocese asks the Court to issue a declaratory judgment setting forth an adjudication with regard to all of the provisions of the Defendants' primary and excess/umbrella liability insurance policies, as to which CBNA is an insured, that are required to be addressed to establish the scope of coverage currently available to CBNA and potentially available to CBNA under the Defendants' various liability policies with regard to abuse claims made against CBNA. Parties Seek Summary Judgments A. Diocese of Fairbanks The Catholic Bishop of Northern Alaska, pursuant to Rule 7056 of the Federal Rules of Bankruptcy Procedure and Rule 56(a) of the Federal Rules of Civil Procedure, asks the U.S. Bankruptcy Court for the District of Alaska for partial summary judgment against Defendants Catholic Mutual Relief Society of America and The Catholic Relief Insurance Company of America with regard to the umbrella coverage provided to CBNA under Catholic Mutual coverage (i) Certificate No. SMP 6594 for the calendar period April 15, 1979, to April 15, 1982, and (ii) Certificate No. SMP 7093 for the calendar period April 15, 1982, to April 15, 1983. In another filing, the Diocese asks the Court to issue a declaratory judgment finding that the excess liability umbrella insurance Policy No. 05 XS 587476, issued by Aetna Casualty and Surety Company, now known as Travelers Casualty and Surety Company, has a separate $5,000,000 per occurrence limit and $5,000,000 general aggregate limit for the "Annual" coverage period of April 15, 1989, to July 1, 1989, and another separate $5,000,000 per occurrence limit and $5,000,000 general aggregate limit for the "Annual" coverage period of July 1, 1989, to July 1, 1990. Specifically, the Diocese seeks a judicial declaration that the umbrella coverage certificates issued by Catholic Mutual to the Diocese provide potential liability coverage for the claims made by numerous remaining pre- and post-bankruptcy claimants, who allege they suffered "Post-Abuse Impacts" as "mental injury," "mental anguish," "shock," and "humiliation" during one of more of the Catholic Mutual umbrella liability coverage periods. The Diocese also seeks a declaratory judgment ruling that, for each of these annual umbrella coverage periods, there is a $2,000,000 "per occurrence" limit and there is no "general bodily injury aggregate" limit applicable to the Diocese's umbrella liability coverage claims under the Catholic Mutual umbrella coverage certificates SMP 6594 and SMP 7093. David A. Paige, Esq., one of the Diocese's counsel, filed declarations in support of the requests. The Diocese also filed support briefs and memoranda. The Diocese submits that the present motion for partial summary judgment presents issues regarding the interpretation of standard policy insurance coverage provision, which are issues of law that are proper for adjudication by the Court under the Declaratory Judgment Act. Susan G. Boswell, Esq., at Quarles & Brady LLP, in Tucson, Arizona, contends that Catholic Mutual's "denial of coverage" position letters cite case law authority from other jurisdictions in an effort to overcome the plain and ordinary meaning of the umbrella coverage provision in the certificates issued to CBNA. She argues that the Court should not allow that approach because there is no "ambiguity" in the coverage provisions that might otherwise lead the Court to consult case law authority from other jurisdictions. "Furthermore, the case law authority cited by Catholic Mutual is readily distinguishable and, once again, cannot be used by the defendant to retroactively re-write its coverage," Ms. Boswell points out, among other things. B. Travelers Casualty Defendant Travelers Casualty and Surety Company seeks partial summary judgment with respect to the Diocese's complaint for declaratory judgment and a declaration that Travelers has no duty to defend or indemnify the Diocese pursuant to Coverage A of Policy No. XS 546692 and Coverage A of Policy No. XS 587476 with respect to the claims asserted by the 284 individuals, who have filed sexual abuse proofs of claim against the Diocese based on alleged abuse that occurred only prior to April 15, 1988, and only after July 1, 1990. Frederick P. Marczyk, Esq., filed an affidavit in support of the request. In its supporting brief and memorandum, Travelers contends that it is (i) entitled to partial summary judgment and the declaration it seeks because no material facts are in dispute, and (ii) entitled as a matter of law to a declaration that it has no duties or obligations to CBNA whatsoever in connection with the Claims pursuant to Coverage A of the Policies. C. Catholic Mutual In their cross-motion for a partial summary judgment with respect to the complaint for declaratory judgment filed by the Diocese, Defendants The Catholic Mutual Relief Society of America and The Catholic Relief Insurance Company of America asks the Court for: (1) a declaration that the Relief Society has no obligation under the umbrella certificates it issued for coverage periods April 15, 1979, through April 15, 1983, to defend or indemnify CBNA with respect to the abuse claims against CBNA that occurred only prior to April 15, 1979; (2) a declaration that the coverage afforded to CBNA under those Umbrella Certificates, which the Relief Society issued during the periods from April 15, 1979, through April 15, 1983, is subject to an annual aggregate limit of liability in the amount of $2,000,000; (3) an order dismissing CBNA's claims under all coverage certificates, which the Relief Society issued for coverage periods commencing on or after July 1, 1990, for failure to comply with the provided mandatory arbitration procedures; and (4) an order dismissing all claims asserted by CBNA against Catholic Mutual because the company has never issued an insurance policy or coverage certificate upon which those claims could be based. In its memorandum supporting the cross-motion and in opposition to the Diocese's request for summary judgment, Catholic Mutual argues that it is entitled to the sought relief because there is no dispute as to any material fact and because it is entitled to partial summary judgment as a matter of law. John C. Wendlandt, Esq., at Sedor, Wendlandt, Evans & Filippi, LLC, in Anchorage, Alaska -- wendlandt@alaskalaw.pro -- contends that the 1979-1983 umbrella excess certificates only cover CBNA's liability for acts of sexual misconduct occurring during the coverage period. He adds that, among other things, allegations of "Post-Abuse Impacts" do not trigger the occurrence-based coverage provided by the umbrella excess certificates. Ray L. Miller, Catholic Mutual's Vice President for Claims, filed an affidavit supporting the cross-motion. About the Diocese of Fairbanks The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka The Diocese of Fairbanks, aka CBNA -- http://www.cbna.info/-- filed for Chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its restructuring efforts. Michael R. Mills, Esq., of Dorsey & Whitney LLP serves as the Debtor's local counsel and Cook, Schuhmann & Groseclose Inc. as its special counsel. Judge Donald MacDonald, IV, of the United States Bankruptcy Court for the District of Alaska presides over Fairbanks' Chapter 11 case. The Debtor's schedules show total assets of $13,316,864 and total liabilities of $1,838,719. The church's plans to file its bankruptcy plan and disclosure statement on July 15, 2008. Its exclusive plan filing period expires on January 15, 2009. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CATHOLIC CHURCH: Fairbanks Professionals File Final Applications ---------------------------------------------------------------- Several professionals employed and retained in connection with the bankruptcy case of the Catholic Bishop of Northern Alaska submitted to the U.S. Bankruptcy Court for the District of Alaska separate final fee applications. Certain professionals also seek payments for services incurred relating to the filing of the applications. Professional Period Fees Expenses ------------ ------ ---- -------- Quarles & Brady LLP 03/01/08 - 03/19/10 $1,842,756 $125,222 Michael Murphy, and 01/15/09 - 03/19/10 184,927 6,347 AlixPartners, LLC Dorsey & Whitney LLP 11/01/08 - 03/19/10 80,556 5,086 Keegan, Linscott & 03/01/08 - 03/19/10 244,663 1,797 Kenon, P.C. Pachulski Stang 03/31/08 - 03/31/10 1,000,536 70,362 Ziehl & Jones LLP Coers Mitchell Law, 01/04/10 - 03/19/10 3,025 356 L.L.C. Cook Schuhmann & 03/01/08 ? 03/19/10 100,818 822 Groseclose, Inc. David H. Bundy, P.C. 03/31/08 - 03/30/10 67,665 1,558 Manly & Stewart -- 260,560 1,749 J.H. Cohn LLP 05/07/09 - 03/19/10 50,942 10,888 Quarles & Brady is the Diocese's general reorganization and restructuring counsel, while Cook Schuhmann, Dorsey, and Coers Mitchell are special counsel for the Diocese. Mr. Murphy is the Diocese's future claims representative, and Keegan Linscott is the accountant and financial consultant. Pachulski Stang is the Official Committee of Unsecured Creditors' counsel and Mr. Bundy is the co-counsel. Manly & Stewart is the Creditors Committee's special insurance coverage counsel. U.S. Trustee Objects to Cook Schuhmann's Fees Robert D. Miller, Jr., Acting United States Trustee for Region 18, reminds the Court that as part of the settlement between the Diocese and the Creditors Committee, the professionals agreed that all administrative expenses after the November 19, 2009 agreement date, will be capped at $150,000. Mr. Miller contends that Cook Schuhmann has not broken down its fees and costs to show the amounts being sought before and after the Settlement Date. He informs the Court that he previously objected to an invoice submitted by the firm because the invoice included secretarial and clerical services in the firm's paralegal billings, and Cook Schuhmann voluntarily agreed to a $341 reduction for that invoice, for the amount he had identified as being non-compensable overhead. Cook Schuhmann's final application continues to include non- compensable overhead, Mr. Miller argues. He points out that of the total amount of fees being sought, Cook Schuhmann has included $41,426 for Deanna Waters, who billed 379 hours at $110 per hour, and of which 43.1 hours, or $4,741, appears to be secretarial or clerical in nature. Hence, Mr. Miller asks the Court to reduce the amount of Cook Schuhmann's fees by $4,741. About the Diocese of Fairbanks The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka The Diocese of Fairbanks, aka CBNA -- http://www.cbna.info/-- filed for Chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its restructuring efforts. Michael R. Mills, Esq., of Dorsey & Whitney LLP serves as the Debtor's local counsel and Cook, Schuhmann & Groseclose Inc. as its special counsel. Judge Donald MacDonald, IV, of the United States Bankruptcy Court for the District of Alaska presides over Fairbanks' Chapter 11 case. The Debtor's schedules show total assets of $13,316,864 and total liabilities of $1,838,719. The church's plans to file its bankruptcy plan and disclosure statement on July 15, 2008. Its exclusive plan filing period expires on January 15, 2009. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CATHOLIC CHURCH: Portland Wants Sapp Files Unsealed --------------------------------------------------- The Archdiocese of Portland in Oregon asks the United States Bankruptcy Court for the Eastern District of Washington to unseal all documents associated with any claim filed by Shamont Sapp alleging sexual abuse by a priest, lay person, or member of The Catholic Bishop of Spokane, also known as The Catholic Diocese of Spokane. The Archdiocese of Portland has a pending bankruptcy case in the United States Bankruptcy Court for the District of Oregon. Mr. Sapp is a pro se prisoner, who has asserted abuse against Portland, Spokane, and at least four other Roman Catholic entities around the country, Thomas V. Dulcich, Esq., at Schwabe, Williamson & Wyatt, P.C., in Portland, Oregon -- tdulcich@schwabe.com -- tells the Spokane Bankruptcy Court. He relates that Portland's investigation to date has revealed that Mr. Sapp's numerous allegations bear a striking resemblance to one another, suggesting that the allegations are of questionable validity. Mr. Dulcich filed a declaration in support of the request. Attached to the declaration are copies of correspondence and other documents from Mr. Sapp to different dioceses, where he asserted claims of clergy abuse. Portland anticipates using the unsealed documents in Mr. Sapp's multi-million dollar claim he has asserted in litigation pending before the Honorable Magistrate Judge Paul Papak in the United States District Court for the District of Oregon, Mr. Dulcich says. Although the pleading in the Sapp Lawsuit was filed by Kelly Clark, Esq., Mr. Clark has since withdrawn from his representation of Mr. Sapp. Mr. Dulcich contends that Mr. Sapp has abdicated any privacy interest in his claims against the six dioceses, in two significant ways: (1) Mr. Sapp is litigating against Portland under his own name rather than a pseudonym, and there is no protective order in place in his litigation against Portland that prevents it from making public his interrogatory responses, which identify his claim against Spokane; and (2) Mr. Sapp is actively seeking publicity for his claims. In recent letters to various individuals and news organizations, Mr. Sapp has broadcasted his alleged experiences in graphic detail. In his e-mail, Mr. Sapp clearly states, "I want my story public," relates Mr. Dulcich. In short, Mr. Dulcich argues, whatever interest Mr. Sapp previously may have had in cloaking his identity or stories, he no longer has. "Any privacy concerns that might in some circumstances justify confidentiality clearly no longer apply to Mr. Sapp's claims," Mr. Dulcich points out. The Archdiocese of Portland, therefore, asks the Spokane Bankruptcy Court -- consistent with Portland's common law right of access to judicial records -- to unseal all documents associated with Mr. Sapp's claim against Spokane, to ensure that any jury that considers his claim against Portland does so with a full record of his prior claims. In a separate filing, Portland notifies the Spokane Bankruptcy Court that Mr. Sapp does not oppose the request. Spokane FCR Objects Larry E. Prince, the Diocese of Spokane's Future Claims Representative, relates that he does not know whether Mr. Sapp has made a claim against Spokane and, if he has, whether any documents remain or, if they remain, what the documents contain. "The FCR's concern with the Motion is the potential chilling effect any order requiring the disclosure of confidential information may have on Future Tort Claimants," Mr. Prince tells the Spokane Bankruptcy Court. Portland's request to unseal, even with Mr. Sapp's consent, is impermissibly broad and, in any event, cannot be granted given the express terms of the Confirmed Plan, Mr. Prince contends. The FCR acknowledges that it may be possible for a Tort Claimant to knowingly waive his confidentiality rights and consent to documents he submitted being made public. Under the Plan's confidentiality provisions he cannot, however, waive or consent to the release of documents provided or prepared by other parties, Mr. Prince points out. The wide-sweeping requirement in Portland's request that "all documents associated with any claim filed" by Mr. Sapp against the Diocese is overly broad and unduly burdensome, Mr. Prince contends. He adds that the request should also be denied because it does not identify who has the duty to determine what documents are "associated" with the claims and who will pay the perhaps significant expenses to comply with the request. About Archdiocese of Portland The Archdiocese of Portland in Oregon filed for Chapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004. Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman Shank LLP, represent the Portland Archdiocese in its restructuring efforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, represents the Official Tort Claimants Committee in Portland, and scores of abuse victims are represented by other lawyers. David A. Foraker serves as the Future Claimants Representative appointed in the Archdiocese of Portland's Chapter 11 case. In its Schedules of Assets and Liabilities filed with the Court on July 30, 2004, the Portland Archdiocese reports $19,251,558 in assets and $373,015,566 in liabilities. The Court approved the Debtor's disclosure statement explaining its Second Amended Joint Plan of Reorganization on February 27, 2007. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). About The Diocese of Spokane The Roman Catholic Church of the Diocese of Spokane filed for chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on Dec. 6, 2004. Michael J. Paukert, Esq., at Paine, Hamblen, Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed $11,162,938 in total assets and $81,364,055 in total debts. The Diocese of Spokane, the Tort Claimants Committee, the Future Claims Representative, and the Executive Committee of the Association of Parishes delivered an Amended Plan of Reorganization, and a Disclosure Statement describing that Plan to the Court on Feb. 1, 2007. The Honorable Patricia C. Williams approved the disclosure statement on March 8, 2007. On April 24, 2007, the Court confirmed Spokane's second amended joint plan. That plan is effective May 31, 2007. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CELL THERAPEUTICS: Inks Exchange Agreement with Noteholders ----------------------------------------------------------- Cell Therapeutics Inc has entered into exchange agreements with certain holders of some of the Company's outstanding 4% Convertible Senior Subordinated Notes due 2010. Pursuant to the terms of the Exchange Agreements, the Company may exchange up to approximately 60 million shares of its common stock for up to approximately $30 million aggregate outstanding principal amount of Notes in one or a series of exchanges, which may be effected over several days. Each of the Company and the other parties to the Exchange Agreements has the right to decide whether to participate in a particular exchange and there is no assurance any exchanges will occur. The term of the Exchange Agreements is ten days, subject to extension unless earlier terminated by any party to the Exchange Agreements. The final number of shares of common stock and the final principal amount of Exchange Notes to be exchanged will be determined based on a number of factors, including, among others, the trading price and volume of the common stock during the term of the Exchange Agreements, the volume weighted average price of the common stock on the securities exchanges where the common stock is listed for trading and the setting of minimum share prices with respect to the maximum number of shares that may be exchanged on a particular trading day. These factors may cause fluctuations in the trading price of the Company's common stock during the term of the Exchange Agreements. The Company will pay accrued and unpaid interest to, but excluding, the settlement date on the Exchange Notes in cash. About Cell Therapeutics Headquartered in Seattle, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company that develops an integrated portfolio of oncology products aimed at making cancer more treatable. Subsequent to the closure of its Bresso, Italy operations in September 2009, CTI's operations are conducted solely in the United States. The Company reported $69.59 million in total assets and $87.73 million in total liabilities, resulting in $18.76 million in stockholders' deficit at Dec. 31, 2009. Going Concern Doubt San Francisco-based Stonefield Josephson, Inc., has included an explanatory paragraph in their report on Cell Therapeutics, Inc.'s December 31, 2009, 2008 and 2007 consolidated financial statements regarding their substantial doubt as to the Company's ability to continue as a going concern. The independent auditors reported that the Company has sustained loss from operations over the audit periods, incurred an accumulated deficit, and has substantial monetary liabilities in excess of monetary assets as of December 31, 2009. Bankruptcy Warning In its Form 10-Q report for the period ended September 30, 2009, filed with the Securities and Exchange Commission, the Company warned it does not expect it will have sufficient cash to fund planned operations through the second quarter of 2010, which raises substantial doubt about its ability to continue as a going concern. The Company said if it fails to obtain capital when required, the Company said it may be required to delay, scale back, or eliminate some or all of its research and development programs and may be forced to cease operations, liquidate its assets and possibly seek bankruptcy protection. CHRYSLER LLC: Says May 2010 U.S. Sales Increased 33% ---------------------------------------------------- Chrysler Group LLC on Wednesday reported a U.S. sales increase of 33%, the second consecutive year-over-year percentage sales improvement, and the first time that monthly sales have topped the 100,000 threshold since March 2009. "May was another positive sign as sales momentum continues to build for Chrysler Group, exceeding the 100,000 unit threshold for the first time in more than a year," said Fred Diaz, President and Chief Executive Officer -- Ram Truck Brand and Lead Executive for U.S. Sales. "The company continues to show improvement each month, with May being our strongest month this year, exceeding overall industry growth for the second month in a row." Chrysler Group LLC reported total U.S. sales for May of 104,819 units, an increase of 33% versus May 2009 (79,010 units). Sales increased 10% compared with April 2010 (95,703 units). Chrysler Group finished the month with a 49-day supply of inventory (196,210 units), a 25% decline versus May 2009 (260,407 units). Overall, U.S. industry sales figures for May are projected at an estimated 11.9 SAAR, the best month to date for the industry in 2010. "The production launch of the all-new 2011 Jeep Grand Cherokee in May signaled the product rebirth of the Chrysler Group, it is a signature vehicle for the company. It represents the best of Chrysler Group, the direction we're moving toward producing high- quality, technologically-advanced vehicles. It is the first of 16 all-new or significantly refreshed vehicles the company is introducing this year," added Diaz. "We are anticipating that there will be strong customer demand for the all-new 2011 Jeep Grand Cherokee adding to the company's momentum as we enter the summer months." "Chrysler Group continues competitive incentives in June, announcing 0% financing for up to 60 months, and 1.9% financing for 72 months on most 2010 model year Chrysler, Dodge, Jeep and Ram truck vehicles when financed through GMAC Financial Services," added Mr. Diaz. * * * The Wall Street Journal's Neal E. Boudette reports that U.S. auto sales rose for the seventh month in a row in May on the strength of big gains by most car makers, including hard-hit Chrysler Group LLC, and renewed popularity for some large trucks and sport- utility vehicles. The Journal, citing Autodata Corp., reports sales of cars and light trucks jumped 19% in May, to 1.1 million vehicles. The Journal says the annualized sales pace for the month was 11.68 million vehicles -- up from the year-ago figure of 9.86 million and April's 11.2 million rate. The Journal further reports that General Motors Co., Ford Motor Co., Honda Motor Co. and Nissan Motor Co. all reported sales increases ranging from 17% to 24%. The Journal says Chrysler, which has been struggling to boost sales since its bankruptcy reorganization last year, outpaced them all, reporting a rise of 33%. Chrysler sold 104,819 vehicles in May, the first time in 14 months it surpassed the 100,000 mark. The Journal notes that sales of Toyota Motor Corp. -- which has been hobbled by its recalls -- grew just 6.7% to 162,813 vehicles after it pared back some sales incentives. About Chrysler Group Based in Auburn Hills, Michigan, Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep, Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars brand vehicles and products. 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) CITIGROUP INC: Sold 20% of Citi Stake for $6.2 Billion ------------------------------------------------------ The U.S. Department of the Treasury announced on May 26 the completion of its sale of 1.5 billion shares of Citigroup common stock pursuant to a trading plan with Morgan Stanley as sales agent as announced on April 26. In this initial plan, Treasury sold 19.5% of its Citigroup common stock holdings and received gross proceeds of approximately $6.2 billion from the sale. The Treasury received 7.7 billion shares of Citigroup common stock last summer as part of the exchange offers conducted by Citigroup to strengthen its capital base. The Treasury exchanged the $25 billion in preferred stock it received in connection with Citigroup's participation in the Capital Purchase Program for common shares at a price of $3.25 per common share. The Treasury currently owns approximately 6.2 billion shares of Citigroup common stock and expects to continue selling its shares in the market in an orderly fashion. Treasury has entered into a second pre-arranged written trading plan under which Morgan Stanley will have discretionary authority to sell an additional 1.5 billion shares under certain parameters. Because Treasury will not sell shares during the blackout period set by Citigroup in advance of its second quarter earnings release, which period is expected to begin on July 1, the plan will terminate on June 30 even if all shares have not been sold by that time. The results of the first trading plan will be posted on Treasury's TARP transaction report within at: http://www.financialstability.gov/ The offering will be made only by means of a prospectus. Morgan Stanley & Co. Incorporated is acting as a sales agent to Treasury. Copies of the prospectus supplement and accompanying prospectus relating to the offering may be obtained from Morgan Stanley & Co. Incorporated, Attn: Prospectus Department, 180 Varick Street, New York, NY 10014, by emailing prospectus@morganstanley.com or by calling toll-free in the United States 1-866-718-1649. About Citigroup Inc. Based in New York, Citigroup Inc. (NYSE: C) -- is a global diversified financial services holding company whose businesses provide a broad range of financial services to consumer and corporate customers. Citigroup has roughly 200 million customer accounts and does business in more than 140 countries. Citigroup's businesses are aligned in three reporting segments: (i) Citicorp, which consists of Regional Consumer Banking (in North America, EMEA, Asia, and Latin America) and the Institutional Clients Group (Securities and Banking, including the Private Bank, and Transaction Services); (ii) Citi Holdings, which consists of Brokerage and Asset Management, Local Consumer Lending, and a Special Asset Pool; and (iii) Corporate/Other. As reported in the Troubled Company Reporter on November 25, 2008, the U.S. government entered into an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. The U.S. Treasury and the Federal Deposit Insurance Corporation agreed to provide protection against the possibility of unusually large losses on an asset pool of roughly $306 billion of loans and securities backed by residential and commercial real estate and other such assets, which will remain on Citigroup's balance sheet. As a fee for this arrangement, Citigroup issued preferred shares to the Treasury and FDIC. The Federal Reserve agreed to backstop residual risk in the asset pool through a non-recourse loan. Citigroup, the third-biggest U.S. bank, received $45 billion in bailout aid. Other bailed-out banks, including Bank of America Corp., Wells Fargo & Co., have pledged to repay TARP money. JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley, repaid TARP funds in June. Citigroup is selling assets to repay the bailout funds. Citigroup is one of the banks that, according to results of the government's stress test, need more capital. CLAIRE'S STORES: Hikes CFO Brodin & President Conroy's Salaries --------------------------------------------------------------- Claire's Stores Inc., filed with the Securities and Exchange Commission Amendment No. 1 to the company's Annual Report on Form 10-K for the fiscal year ended January 30, 2010, to disclose that on May 25, 2010, Per Brodin was promoted to Executive Vice President and Chief Financial Officer of the Company. Mr. Brodin has served as Senior Vice President and Chief Financial Officer of the Company since February 2008. In connection with such promotion, the Company's board of directors, upon recommendation of the compensation committee, approved an increase in Mr. Brodin's annual base salary from $440,000 to $490,000, effective May 1, 2010, on the basis of his promotion, his added responsibility over our global Information Technology function and his Fiscal 2010 merit increase. The Company also disclosed that on May 25, 2010, the Company's Board of Directors, upon recommendation of the Company's compensation committee, approved a Second Amendment to the Employment Agreement of James G. Conroy, the Company's President. Mr. Conroy's employment agreement was amended to provide for an increase of his annual base salary to $665,000, effective May 1, 2010, on the basis of his previous promotion to President in April 2009 and his Fiscal 2010 merit increase. The original annual report was filed on April 13, 2010. A full-text copy of Amendment No. 1 is available at no charge at http://ResearchArchives.com/t/s?63d0 About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores, Inc., also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. At May 1, 2010, the Company had total assets of $2,828,167,000 against total current liabilities of $189,612,000; long-term debt of $2,297,603,000; revolving credit facility of $194,000,000; obligations under capital leases of $17,290,000; deferred tax liability of $121,156,000; deferred rent expense of $22,680,000; unfavorable lease obligations and other long-term liabilities of $34,070,000; resulting in stockholder's deficit of $48,244,000. CLAIRE'S STORES: Reports $12,300,000 Net Loss for May 1 Qtr ----------------------------------------------------------- Claire's Stores, Inc., reported a net loss of $12,300,000 for the three months ended May 1, 2010, from a net loss of $29,023,000 for the three months ended May 2, 2009. Net sales were $322,077,000 for the three months ended May 1, 2010, from $293,098,000 for the three months ended May 2, 2009. At May 1, 2010, the Company had total assets of $2,828,167,000 against total current liabilities of $189,612,000; long-term debt of $2,297,603,000; revolving credit facility of $194,000,000; obligations under capital leases of $17,290,000; deferred tax liability of $121,156,000; deferred rent expense of $22,680,000; unfavorable lease obligations and other long-term liabilities of $34,070,000; resulting in stockholder's deficit of $48,244,000. In a press statement, Chief Executive Officer Gene Kahn commented, "Our first quarter results demonstrate continued improvement despite a volatile global economy. We acknowledge the contribution of our worldwide team for their steadfast commitment to our business objectives which helped produce this relatively strong performance." At May 1, 2010, cash and cash equivalents were $220.0 million and $194.0 million continued to be drawn on the Company's Revolving Credit Facility. The Company drew the full available amount under the facility during the fiscal 2008 fourth quarter to preserve the availability of the commitment because a member of the facility syndicate, Lehman Brothers, filed for bankruptcy. The agent bank has not yet found a replacement for Lehman Brothers in the facility syndicate, or arranged for the assumption of Lehman Brothers' commitment by a creditworthy entity. The Company will continue to assess whether to pay down all or a portion of this outstanding balance based on various factors, including the creditworthiness of other syndicate members and general economic conditions. During the fiscal 2010 first quarter, the Company paid $16.8 million to retire $6.0 million of Senior Toggle Notes and $15.6 million of Senior Subordinated Notes. A full-text copy of the Company's Form 10-Q report is available at no charge at http://ResearchArchives.com/t/s?63cd A full-text copy of the Company's earnings release is available at no charge at http://ResearchArchives.com/t/s?63d1 About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores, Inc., also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. COMMERCIAL VEHICLE: All Directors Enter 90-Day Lock-Up Deal ----------------------------------------------------------- Commercial Vehicle Group, Inc., said that all of the directors and executive officers of the company entered into a 90-day lock-up agreement with Robert W. Baird & Co. Incorporated in connection with a registered public offering of common stock in which Baird served as the sole underwriter. The Company has been informed that Baird has agreed to release all directors and executive officers from the lock-up agreements dated May 26, 2010. About Commercial Vehicle Group New Albany, Ohio-based Commercial Vehicle Group, Inc., (Nasdaq: CVGI) supplies fully integrated system solutions for the global commercial vehicle market, including the heavy-duty truck market, the construction and agricultural markets, and the specialty and military transportation markets. The products include static and suspension seat systems, electronic wire harness assemblies, controls and switches, cab structures and components, interior trim systems (including instrument panels, door panels, headliners, cabinetry and floor systems), mirrors and wiper systems specifically designed for applications in commercial vehicles. The Company has facilities located in the United States in Arizona, Indiana, Illinois, Iowa, North Carolina, Ohio, Oregon, Tennessee, Virginia and Washington and outside of the United States in Australia, Belgium, China, Czech Republic, Mexico, Ukraine and the United Kingdom. Commercial Vehicle Group Inc.'s balance sheet at December 31, 2009, showed $250.5 million in total assets and $288.2 million in total liabilities, resulting in a $37.7 million stockholders' deficit. * * * Commercial Vehicle carries a 'Caa2' Corporate Family Rating and 'Caa2/LD' Probability of Default Rating from Moody's. It has a 'CCC+' corporate credit rating from Standard & Poor's. COMMUNITY BANCORP: Files For Chapter 7 Protection ------------------------------------------------- BankruptcyData.com reports that Community Bancorp filed for Chapter 7 protection (Bankr. D. Nev. Case No. 10-20038). This bank holding company is represented by Richard F. Holley of Santoro, Driggs, Walch, Kearney, Holley & Thompson. The U.S. Trustee scheduled a July 7, 2010 meeting of creditors under 11. U.S.C. Sec. 341. On August 14, 2009, Community Bank of Nevada, Las Vegas, Nevada, was closed by the State Commissioner, by order of the Nevada Financial Institutions Division, which then appointed the Federal Deposit Insurance Corporation as receiver. On its most recent annual report filed with the SEC, Community Bancorp listed $1.7 billion in total assets, but the Chapter 7 petition indicates just $44 million. About Community Bancorp Community Bancorp -- http://www.community-bancorp.com/ --headquartered in Las Vegas, Nevada, was the holding company for Community Bank of Nevada and Community Bank of Arizona. In 2002, Community Bancorp was formed as the holding company of Community Bank of Nevada, a Las Vegas based bank organized in July 1995 by local community leaders and experienced bankers with the mission of providing superior community banking services. CONTINENTAL ALLOYS: Moody's Upgrades Corp. Family Rating to 'Caa1' ------------------------------------------------------------------ Moody's Investors Service upgraded Continental Alloys & Services, Inc.'s Corporate Family Rating to Caa1 from Caa2, its Probability of Default Rating to Caa1 from Caa2 and its senior secured bank credit facilities to Caa1 (LGD 4, 53%) from Caa2 (LGD4, 51%). The rating outlook is positive. The upgrade reflects an improved liquidity profile and recovery in sequential operating results. A recovery in oilfield services demand, $14.5 million equity contribution, working capital management and cost reduction efforts have improved the company's credit ratios. In addition, the company, through an amended bank credit facility, is expected to have sufficient financial covenant cushion in 2010. The positive outlook reflects the expectation that debt will be reduced further in 2010 through free cash flow generation. If Continental is successful in continuing to manage working capital and liquidity, as well as repay debt and reduce financial leverage (debt/EBITDA below 4.0x on a sustainable basis), an upgrade to B3 is possible. Continental's EBITDA (as adjusted for Moody's adjustments) over the last twelve months ending March 31, 2010 was less than $20 million, a cyclical low, driven by curtailed North American exploration and production capital budgets. However, the company's sequential earnings trends have been increasing, as upstream spending levels have begun to recover. In addition, as Continental has worked off higher cost inventory, lowered its cost structure and as a result of continued focus on value-added services, margins have been improving and have remained higher than several of its metals distribution peers. Nevertheless, Moody's expects the company's profitability levels will remain volatile due to its reliance on demand for completion products and tools. Moody's remain concerned that weak natural gas prices could result in spending levels being constrained in the second half of 2010. Moody's estimates Continental's debt/EBITDA for the last twelve months ending March 31, 2010, to be over 8.0x. With a $14.5 million equity contribution from its private equity sponsor and management in the second half of 2009 and free cash flow generation, the company has reduced debt from $154 million at year-end 2008 to $121 million at the end of May (as adjusted for operating leases). Debt is expected to be further reduced in 2010 from free cash flow generation, with debt/EBITDA expected to be under 4.0x by year-end. The last rating action was on June 3, 2009, when Moody's downgraded Continental's ratings over earnings and liquidity concerns. Continental Alloys & Services, Inc., is a materials supplier to the energy service industry and is headquartered in Spring, Texas. COOPER-STANDARD AUTOMOTIVE: S&P Raises Corp. Credit Rating to 'B+' ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Novi, Mich.-based auto supplier Cooper-Standard Automotive Inc. to 'B+' from 'D'. The rating action follows the announcement that Cooper-Standard Holdings Inc., the parent of Cooper-Standard Automotive, along with its subsidiaries that also filed for Chapter 11 protection, emerged from bankruptcy on May 27, 2010, and that its second amended joint Chapter 11 plan of reorganization had become effective. The company reported that its Canadian subsidiary, Cooper-Standard Automotive Canada Limited, had also emerged from bankruptcy protection in Canada on May 27. At the same time, S&P assigned a 'B+' issue-level rating and '3' recovery rating on Cooper-Standard Automotive's $450 million 8.5% unsecured notes due May 1, 2018. The company issued the notes in late April and the proceeds were released from escrow on May 27, 2010. The outlook is stable. The outlook reflects S&P's view that Cooper-Standard's intermediate-term financial prospects will support the 'B+' rating, in part because of the company's reported reduction of permanent debt in the capital structure. S&P also bases this outlook on its assumption that Cooper-Standard's restructuring activities during the downturn and ongoing operating efficiency initiatives have created some sustainable margin improvement that should result in earnings and free cash generation as vehicle production rises somewhat, year over year, with expected inventory rebuilding in North America. In Europe, S&P assumes the company can benefit from an improved product mix, despite S&P's expectation that auto sales there will be flat or down slightly, year over year, in 2010. "S&P could raise the ratings if S&P believed Cooper-Standard could achieve and sustain meaningful free cash generation, but S&P currently do not expect this in 2010 or 2011," said Standard & Poor's credit analyst Nancy Messer. "Alternatively, S&P could lower the ratings if S&P believed auto industry markets would not improve as S&P assumes or if the economic recovery falters, thereby preventing the company from achieving the financial measures in 2010 that S&P expects for the 'B+' rating," she continued. S&P expects lease- and pension-adjusted total debt to EBITDA of about 3.5x as of Dec. 31, 2010, and funds from operations to total debt of 13.5% or better. S&P could also consider lowering the ratings if S&P believed the company would have more than $25 million in negative free cash generation in 2010 or 2011 because of lower revenues, atypically high commodity costs, unexpected higher capital spending, or impaired margins. S&P could also lower the ratings if Cooper-Standard makes a transforming acquisition with available cash or makes a debt- financed acquisition, or if the new board of directors adopts a radically different business strategy or financial policies. CORELOGIC, INC: Moody's Assigns 'Ba2' Rating on $500 Mil. Loan -------------------------------------------------------------- Moody's Investors Service has assigned definitive corporate family and probability of default ratings of Ba2 to CoreLogic, Inc. (formerly The First American Corporation's Information Solutions Company). Concurrently, Moody's assigned Ba2 ratings to CoreLogic's $500 million revolving credit facility and $350 Senior Secured Term Loan. The rating outlook is stable. Due to the completion of the spin-off of its financial services businesses (mainly its title insurance and specialty insurance reporting segments) into a separate public company, Moody's has removed the former (P) provisional ratings previously assigned to the senior secured revolver and term loan. CoreLogic's Ba2 CFR reflects the company's leading market position within the mortgage settlement services market, long-standing relationships with several of the largest financial institutions, solid financial performance through economic cycles, and an increasingly diversified business model consisting of proprietary data analytics (e.g., loan performance and fraud detection) and risk mitigation services (e.g., credit services, employer services, and litigation support). The rating is constrained, however, by the company's high revenue concentration (approximately 70% real estate related), high customer concentration (with its top 10 clients accounting for about half of total revenue), and low geographic diversity (with substantially all of its revenue generated in the U.S.). A short-term speculative grade liquidity rating of SGL-1 has also been assigned, reflecting CoreLogic's very good internal and external liquidity following the spin-off, including a cash balance in excess of $350 million and cash flow from operations that should be more than sufficient to fund necessary capital expenditures, working capital requirements and mandatory debt amortization over the next twelve months. The company has external liquidity in the form of its $500 million revolving credit facility ($85 million is currently drawn) that expires in July 2012. However, in connection with the potential purchase of the remaining Experian interest in the First American Real Estate Solutions LLC joint venture in December 2010, the company may incur additional debt related to the $318 million purchase price. To the extent that the revolver is substantially used to fund the acquisition, the company could face intermediate-term refinancing needs given the relatively short duration of the revolver. The stable rating outlook reflects the company's solid operating performance amidst the economic downturn and weak housing market, supported by the strength of the company's customer base, its proprietary data assets, significant operating leverage, and the growing diversity of revenue streams outside of mortgage originations. In addition, the stable outlook considers Moody's expectation that management will maintain conservative financial policies with a leverage target not exceeding 3x on a sustained basis. These first-time ratings/assessments were assigned: * Corporate Family Rating -- Ba2 * Probability of Default Rating -- Ba2 * $500 Million Senior Secured Revolving Credit Facility due 2012 - - Ba2 (LGD-3, 42%) * $350 Million Senior Secured Term Loan due 2016 -- Ba2 (LGD-3, 42%) * Speculative Grade Liquidity Rating of SGL-1 The last rating action was on March 8, 2010, when Moody's assigned a (P)Ba2 rating to the company's proposed $500 million revolving credit facility. CoreLogic, Inc., headquartered in Santa Ana, California, is a leading provider of property and mortgage data and analytics products and solutions. The company provides outsource solutions in mortgage risk analytics; property, credit and employment information. Revenues for the twelve months ended March 31, 2010, were approximately $2 billion. DANKA BUSINESS: Shareholders Okay Members' Voluntary Liquidation ----------------------------------------------------------------- Danka Business Systems PLC reported that its shareholders in favor of the members' voluntary liquidation, which was considered by the Company's directors to be the most appropriate way of distributing surplus assets to shareholders after: a) Danka's disposal of its European businesses to Ricoh Europe BV in January 2007, and b) the disposal by Danka Holding Company, an indirect subsidiary of Danka, of its US trading subsidiary, Danka Office Imaging Company, to Konica Minolta Business Solutions U.S.A. Inc. in June 2008. According to the Company, shareholders are entitled to receive any surplus assets remaining after the payment of creditors and expenses of the liquidation up to an amount of $392 million. As the Directors' estimated there would only be surplus assets of approximately $66 million, the CPS would have been entitled to receive the whole of the surplus, leaving no amount available to the Ordinary Shareholders. However, as reported in the Circular recommending the liquidation, the CPS directed the liquidators to pay to the Ordinary Shareholders $0.03 per ordinary share or $0.12 per ADS in priority to the CPS at such time as they are in a position to make a distribution to shareholders. For reasons that are explained in greater detail below, the liquidators are not yet in a position to make the Payment. A full-text copy of the Company's regulatory filing is available for free at http://ResearchArchives.com/t/s?63d9 Danka Business Systems PLC (LON: DNK) -- http://www.danka.com/-- offered document solutions including office imaging equipment: digital and color copiers, digital and color multifunction peripherals printers, facsimile machines, and software in the United States. It also provided a range of contract services, including professional and consulting services, maintenance, supplies, leasing arrangements, technical support and training, collectively referred to as Danka Document Services. DELPHI CORP: Objects to Pensioners' Plea to Undo Plan Termination ----------------------------------------------------------------- DPH Holdings Corp. and its affiliates object to Dennis Black, Charles Cunningham, Kenneth Hollis and the Delphi Salaried Retirees Association's request to file a second amended complaint to the extent the Salaried Retirees seek relief that would undo termination of, and reinstate, the Delphi Retirement Program for Salaried Employees. The Salaried Retirees' request is in relation to an action they commenced against the Pension Benefit Guaranty Corporation before the U.S. District Court for the Eastern District of Michigan. Counsel to the Reorganized Debtors, John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, argues that the relief sought implies a potential collateral attack on the Modified First Amended Joint Plan of Reorganization and its related confirmation order dated July 30, 2009. "If the Salaried Retirees are seeking to put the Pension Plan to the Reorganized Debtors, then the relief sought would undo a critical element of the Modified Plan -- resolving the Debtors' pension issues -- and would render the Reorganized Debtors immediately insolvent and thus unable to pay allowed administrative claims in full as set forth in the Modified Plan," he asserts. "The Reorganized Debtors would, thus, be forced to liquidate," he emphasizes. Mr. Butler reminds the U.S. Bankruptcy Court for the Southern District of New York that at the time the Debtors proposed the Modified Plan, their reorganization was not feasible unless all of Delphi's pension obligations were either terminated or assigned. To that end, the Debtors and the PBGC entered into a comprehensive agreement providing for the termination of the Pension Plan and compromising the PBGC's substantial claims against the Debtors. Similarly, the transactions consummated under Delphi's Master Disposition Agreement were expressly conditioned on the effectiveness of the PBGC Settlement Agreement, primarily because the buyers did not want the risk associated with the PBGC's asserted liens against certain non- Debtor foreign affiliates. Against this backdrop, the Reorganized Debtors ask Judge Drain to deny the Salaried Retirees' Motion to the extent that the Second Amended Complaint seeks relief that would directly or indirectly create liabilities or obligations for them in relation to the Pension Plan. The Bankruptcy Court will convene a hearing to consider the Salaried Retirees' request on June 30, 2010. DSRA Uncovers Evidence Supporting Unjust Termination of Pension The Delphi Salaried Retirees Association or DSRA found new evidence proving that the termination of the Pension Plan by the PBGC in 2009 was unjustified, as verified by two independent actuaries, Kokomo Perspective reports. The article discloses that at the time the Delphi Pension Plan was terminated by the PBGC, the Adjusted Funding Target Attainment Percentage was 85.6%. A study produced by Milliman Inc., an actuarial firm, indicated that the funded status of the 100 largest defined benefit pension plans was 81.7% during 2009, meaning the Delphi Pension Plan was more fully funded than other plans that were unterminated or even considered for termination, Kokomo Perspective elaborates. The DSRA also obtained the deposition of Matthew Feldman, a member of the U.S. Department of the Treasury's Auto Task Force, stating that the level of involvement by the Task Force and the Treasury Department in the speed with which the Delphi Pension Plan was terminated, the report reveals. The deposition highlights that the U.S. government was looking out for its own interests, as a majority owner of General Motors Company or New GM rather than fulfilling its lawful duties, according to the report. The new evidence and information were incorporated in the DSRA's pleadings responsive to the PBGC's summary judgment motion filed with the District Court. Lawmakers Blast Sec. Geithner for Refusing to Answer Pension Queries Timothy F. Geithner, secretary of the U.S. Treasury Department, declined to answer questions asked by U.S. Representatives Mike Turner and Dan Burton concerning the Treasury Department's role in a decision that led to a loss of pension value of former Delphi employees, according to a public statement by Mr. Turner dated May 20, 2010. Mr. Turner stated that the administrative record of the PBGC show that the organization had discussions with the Treasury Department when a decision was made to reduce pension payouts for non-union employees of Delphi Corp. Messrs. Turner and Burton previously asked the Treasury Department, specifically Mr. Geithner in January 2010, to answer a series of questions related to the pension reduction decision. Mr. Geithner recently responded that he would not answer most of the questions because the matter is subject of a lawsuit filed by the Salaried Retirees against the PBGC. "This refusal to answer questions is an outrage against the salaried retirees of Delphi, in Ohio and other states," Mr. Turner commented. A transcript of extracts from Mr. Geithner's responses dated January 27, 2010, related to the PBGC/Delphi Salaried Pensions is available for free at: http://bankrupt.com/misc/Delphi_GeithnerResponses.pdf In a related development, U.S. Senator Sherrod Brown related in a May 11, 2010 public statement that he would object to the nomination of Joshua Gotbaum as director of the PBGC. That action, related Mr. Brown, is designed to prevent the consideration of the nomination by unanimous consent, in order to urge U.S. President Barack Obama's administration to bring General Motors Company to the table to meet the pension obligations of Delphi salaried retirees. "We owe it to Delphi retirees to take all steps possible to secure their pensions," Mr. Brown said in the public statement. "That's why I'm urging the Obama Administration to encourage GM to meet its obligations to Delphi retirees," Mr. Brown added. In a separate report, U.S. Rep. Timothy J. Ryan, D-Niles, said that he would use time he had with President Obama to argue the case for the Salaried Retirees who lost their health care with the reorganization of Delphi Packard Electric, Raymond L. Smith of the Tribune Chronicle reports. Mr. Ryan's statement was in relation of President Obama's visit in Mahoning Valley, Ohio, last May 19, 2010. Mr. Ryan disclosed that he mentioned the plight of the Delphi salaried retirees on the last two times he met with President Obama and also talked to Mr. Geithner. Bruce Gump, chairman of Warren Legislative Group of the DSRA, commented that he hopes someone in the Obama administration will help them resolve their pension issues, The Tribune Chronicle adds. www.wfmj.com noted in a separate report that a Congressional hearing will be held in Ohio sometime in the summer with respect to the Delphi Salaried Retirees' pensions. U.S. Rep. Ryan and U.S. Rep. Charlie Wilson said they will hold the hearing to discuss the differences in the pensions of Delphi salaried and hourly rate employees, according to www.wfmj.com In a related development, Delphi retirees made a protest before Delphi's former plant in Oak Creek, Wisconsin, to bring attention to lost jobs, www.fox6now.com reports. The City of Oak Creek is looking forward to the demolition of the former Delphi plant in light of a building of a new I-94 Interchange at Drexel, which is expected to make the site prime business real estate property. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi had approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELPHI CORP: Parties Fight Sealed Avoidance Suits ------------------------------------------------- Twenty-six creditors are opposing Delphi Corp.'s previous filing of complaints under seal without their knowledge and the entry of certain orders extending deadlines under Rule 4(m) of the Federal Rules of Civil Procedure, past the expiration of the statute of limitations. The orders are referred to as "Avoidance Claims Order" and relate to: (i) that order entered on August 16, 2007, establishing procedures for certain adversary proceedings, including those commenced by the Debtors under Sections 541, 544, 545, 547, 548 or 553 of the Bankruptcy Code; and (ii) that order extending the deadline under Civil Rule 4(m), by which the Debtors would be required to serve process on March 28, 2008, April 30, 2008, and October 22, 2009. Microchip Technology Incorporated, Wagner-Smith Company and Affinia Group Holdings, Inc., filed similar Motions to Vacate. Wagner-Smith filed its request in February 2010; Microchip in March 2010; and Affinia in May 2010. Delphi Corp. previously filed under seal avoidance actions against certain parties seeking to recover amounts in alleged preferential transfers made to those parties. In September 2007, Delphi opened a file which allegedly contained sealed complaints against the parties. The Creditors complain that they first learnt of being sued by the Debtors for alleged preferential transfers 2 1/2 years after the expiration of the statute of limitations. The Creditors further assert that the Reorganized Debtors finally served them with the unsealed complaints 4 1/2 years after the alleged preferential transfers were purportedly made. The 26 Opposing Creditors and the corresponding preferential transfers allegedly made by the Debtors to them are: Preferential Defendant Transfer Amount --------- --------------- Ambrake Corporation $39,000,000 GBC Metals LLC 24,534,559 Setech, Inc. 21,332,109 Valeo Climate Control Corp., et al. 19,500,000 ATS Automation Tooling Systems Inc. 17,312,532 The Timken Company, Timken Corp., et al. 12,083,005 Doshi Prettl International 8,710,942 Spartech Polycom 8,637,901 Sumitomo Wiring Systems (USA), Inc., et al 7,500,000 DSSI LLC and DSSI 7,070,216 Norilsk Nickel USA, Inc. 6,367,078 M&Q Plastic Products L.P. 6,600,000 Florida Production Engineering, Incorporated 5,696,884 Mubea, Inc. 5,000,000 MSX International, Inc. 4,400,000 NGK Automotive Ceramics USA, Inc. 4,000,000 Bosch Chassis Systems Columbia L.L.C. 3,600,000 Wells Fargo Bank, N.A. 2,741,531 Access One 1,456,934 GKN Sinter Metals LLC 1,200,000 Fin Machine Co. Ltd. 1,132,271 Robert Bosch GmbH and Robert Bosch LLC 1,087,460 Ex-Cell-O Machine Tools, Inc. 611,528 D&S Machine Products, Inc. 450,000 Pro Tech Machine - Stephenson & Sons Roofing - Carlisle Companies Incorporated - MJ Celco, Inc. also known as MJ Celco - In separate motions filed with the Court, the Creditors ask Judge Drain to, among others: (1) vacate, with respect to them, the interlocutory Extension Orders pursuant to the Court's discretionary authority for these reasons: -- Delphi's intentional failure to provide the Avoidance Defendants with notice of the motions seeking entry of the Extension Orders violates due process and renders the Extension Orders void and unenforceable; -- cause did not exist to extend the time for service of the Complaints; and -- the Complaints were improperly filed under seal pursuant to Section 107 of the Bankruptcy Code; (2) dismiss with prejudice the Complaints against them, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, made applicable by Rule 7012(b) of the Federal Rules of Bankruptcy Procedure for these reasons: -- It is barred by the two-year statute of limitations; and -- It does not comply with the pleading requirements In re Ashcroft v. Igbal, 129 S.Ct. 1937 (2009); and (3) dismiss the Complaints because they are barred by laches, judicial estoppel or res judicata. In the alternative, the Creditors ask the Court to direct the Reorganized Debtors to provide a more definite statement of the pleadings pursuant to Civil Rule 12(e) and Bankruptcy Rule 7012(e). In support of their Motions to Vacate, various Creditors filed with the Court memoranda of law. With respect to Setech, Richard M. Eddinger filed a declaration in support of Setech's Motion. Mr. Eddinger stated that Setech had no knowledge that the Debtors would sue or in fact did sue, Setech until it received the complaint in April 2010. Mr. Eddinger is vice president and chief financial officer of Setech. "The combination of permitting the Debtors to file the Complaints under seal -- thus concealing from the Creditors that they had been sued -- while repeatedly extending the Debtors' time to serve process for nearly two and a half years after the expiration of the statute of limitations, all without notice or an opportunity for the Creditors to object, has resulted in proceedings completely devoid of procedural due process," says Dawn R. Copley, Esq., at Dickinson Wright PLLC, in Ann Arbor, Michigan -- dcopley@dickinsonwright.com -- counsel to Ambrake, one of the Creditors. Delphi's Complaints are also barred by the 2-year statute of limitations, Ms. Copley asserts. Allowing Delphi to prosecute its claims now, more than 2 years after the statute of limitations expired and more than 4 years after the alleged preference payments were made, would result in unfair prejudice to the Creditors and would eviscerate the purpose of the statute of limitations, she emphasizes. Even in the absence of Delphi's due process violations, the Extension Orders should be vacated, Ms. Copley contends. For one, cause simply did not exist for the repeated extension requests made by Delphi under Civil Rule 4(m), made applicable by Rule 7004 of the Federal Rules of Bankruptcy Procedure, she insists. Ms. Copley notes that Civil Rule 12(e) and Bankruptcy Rule 7012(b) allow a party to move for a more definite statement of a pleading to which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response. In the current situation, the only factual allegation asserted regarding the alleged preferential transfers is the list of transfer dates, transfer amounts and transfer types, she points out. Given the lack of further information as to which of the Debtors initiated those transfers, the Creditors cannot reasonably prepare a response to the allegations contained in the Complaints, she stresses. Tyco Adhesives LP; LDI Incorporated; Invotech Engineering Inc.; Universal Tool & Engineering Company, Inc.; Sumitomo Corporation and Sumitomo Corp. of America join in the Creditors' Motions to Vacate the Avoidance Claims Orders. In addition, these entities filed joinders to Microchip's, Wagner-Smith's and Affinia's Motions to Vacate Avoidance Claims Orders: * Wells Fargo Bank, N.A. * Monroe, Inc. * Tyco Adhesives LP * Regions Bank Birmingham * Barnes & Associates * Universal Tool & Engineering Company, Inc. * Critech Research Inc.; F.A. * Tech Corporation Williams * Blair Strip Steel Co. * Ahaus Tool & Engineering Inc. * Tata America International Corporation dba TCS America * E.I. du Pont de Nemours and Company * Invotec Engineering Inc. * Prudential Relocation, Prudential Relocation Inc. and Prudential Relocation Int'l. * Shuert Industries, Inc. * Sumitomo Corporation * Brake Parts, Inc. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi had approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DENNIS GIBBS: Section 341(a) Meeting Scheduled for June 21 ---------------------------------------------------------- The U.S. Trustee for Region 17 will convene a meeting of Dennis A. Gibbs and Laurie M. Gibbs' creditors on June 21, 2010, at 9:00 a.m. The meeting will be held at the Oakland U.S. Trustee Office, 1301 Clay Street #690N, Oakland, CA 94612. 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. Castro Valley, California-based Dennis A. Gibbs and Laurie M. Gibbs filed for Chapter 11 bankruptcy protection on May 18, 2010 (Bankr. N.D. Calif. Case No. 10-45706). Vincent Renda, Esq., at Renda Law Offices, P.C., assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. DGI RESOLUTION: Lance Thibault Steps Down as CFO ------------------------------------------------ DGI Resolution Inc. reports that Lance Thibault resigned as the company's chief financial officer effective May 14, 2010. About deCODE Genetics deCODE Genetics Inc. is a global leader in analyzing and understanding the human genome. deCODE has identified key variations in the sequence of the genome conferring increased risk of major public health challenges from cardiovascular disease to cancer, and employs its gene discovery engine to develop DNA-based tests to assess individual risk of common diseases; to license its tests and intellectual property to partners; and to provide comprehensive, leading- edge contract services to companies and research institutions around the globe. The Company was founded in 1996 and is headquartered in Reykjavik, Iceland. The Company filed for Chapter 11 on November 16, 2009 (Bankr. D. Del. Case No. 09-14063). The petition listed assets of $69.9 million against debt of $314 million. Liabilities include $230 million on 3.5% senior convertible notes. DISH NETWORK: Unit Reports Granting of En Banc Hearing ------------------------------------------------------ DISH Network LLC, a subsidiary of DISH Network Corporation, and EchoStar Technologies LLC issued a statement regarding recent developments in TiVo vs. EchoStar Communications Corporation: "DISH Network and EchoStar are pleased that the full Federal Circuit Court of Appeals has granted their petition for rehearing en banc. We believe the issues that will be considered by the full court on rehearing will have a profound impact on innovation in the United States for years to come." Dish Network Corporation is the third largest pay television provider in the United States with 14.1 million subscribers as of 12/31/2009. Annual revenues approximate $11.6 billion. * * * According to the Troubled Company Reporter on March 9, 2010, Moody's Investors Service said that Dish Network Corporation's Ba3 Corporate Family rating and stable outlook are not affected by the announcement that a U.S. appeals court upheld a lower court's ruling that despite changes made by Dish to its DVR software, the company was still infringing on TiVo Inc.'s patents. Dish and TiVo have been in litigation since 2004 over TiVo's patent infringement claim. As a result of the ruling, the company owes approximately $300 million in damages through July 2009 and potentially additional charges should the company be required to pay for patent infringements since July 2009. Dish announced that it will be seeking a further review of the court's latest decision by the full Federal Circuit. DON GROVER: Section 341(a) Meeting Scheduled for July 8 ------------------------------------------------------- The U.S. Trustee for Region 17 will convene a meeting of Don Grover White's creditors on July 8, 2010, at 1:00 p.m. The meeting will be held at 300 Las Vegas Blvd., 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 Don Grover White filed for Chapter 11 bankruptcy protection on May 21, 2010 (Bankr. D. Nev. Case No. 10- 19402). Amy N. Tirre, Esq., at the Law Offices of Amy N. Tirre, assists the Company in its restructuring effort. The Company listed $1,000,001 to 10,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. DRAGON PHARMACEUTICAL: Earns $1.6 Million in Q1 2010 ---------------------------------------------------- Dragon Pharmaceutical Inc. filed its quarterly report on Form 10-Q, reporting net income of $1.6 million on $49.1 million of revenue for the three months ended March 31, 2010, compared with net income of $1.4 million on $37.0 million of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $200.1 million in assets, $132.9 million of liabilities, and $67.2 million of stockholders' equity. As reported in the Troubled Company Reporter on April 5, 2010, Chang Lee LLP, in Vancouver, Canada, said the Company's recurring working capital deficiency raises substantial doubt about its ability to continue as a going concern. The Company has a working capital deficiency of $56.7 million as at March 31, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63c6 Incorporated in Florida and headquartered in Vancouver, Canada, Dragon Pharmaceutical Inc. -- http://www.dragonpharma.com/-- manufactures and distributes a broad line of antibiotic products including Clavulanic Acid and 7-ACA, a key intermediate to produce cephalosporin antibiotics and formulated drugs. Dragon Pharmaceutical is the third largest 7-ACA producer in China. DREIER LLP: Chapter 7 Trustee Balks at Ex-Wife's Claim ------------------------------------------------------ Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports that Salvatore LaMonica, the Chapter 7 trustee appointed to oversee the liquidation of Marc Dreier's assets, has argued that bankruptcy laws peg his fee request above "any claim Elisa Dreier could be entitled to." The Chapter 7 trustee is fighting a bid by Mr. Dreier's ex-wife to have her $7.1 million domestic support claim elevated above the Chapter 7 trustee's already-reduced fees. The Dreiers' divorce was finalized in 2008. According to Dow Jones, the Chapter 7 trustee said he's been more than generous in his treatment of Ms. Dreier. Dow Jones relates the Chapter 7 trustee argued that the divorce agreement doesn't cover future domestic support obligations, just those incurred before the involuntary bankruptcy proceeding Marc Dreier's creditors pushed him into last year. According to Dow Jones, the Chapter 7 Trustee pointed out he's already written her a check for about $106,000 -- noting that the amount is "conspicuously absent" from Ms. Dreier's request. As reported by the Troubled Company Reporter on May 20, 2010, Ms. Dreier urged the Bankruptcy Court to deny a fee request from the Chapter 7 trustee, arguing that her ex-husband's few assets should first be directed to her $7.1 million domestic support claim. Dow Jones last month reported Mr. LaMonica has asked the Manhattan Bankruptcy Court to approve an interim payment of more than $273,000 in fees and about $3,700 in expenses for the 500 hours he devoted to Mr. Dreier's bankruptcy case between March 1, 2009, and April 20, 2010. Dow Jones said a federal bankruptcy monitor supports the request, and that the requested payment represents less than half of what Mr. LaMonica is actually owed. About Dreier LLP Marc Dreier founded New York-based law firm Dreier LLP -- http://www.dreierllp.com/-- in 1996. On December 8, 2008, the U.S. Securities and Exchange Commission filed a suit, alleging that Mr. Dreier made fraudulent offers and sales of securities in several cities, selling fake promissory notes to hedge and other private investment funds. The SEC asserted that Mr. Dreier also distributed phony financial statements and audit opinions, and recruited accomplices in connection with that scheme. Mr. Dreier has been charged by the U.S. government for conspiracy, securities fraud and wire fraud before the U.S. District Court for the Southern District of New York (Manhattan) (Case No. 09-cr-00085-JSR). Dreier LLP sought chapter 11 protection (Bankr. S.D.N.Y. Case No. 08-15051) on Dec. 16, 2008. Stephen J. Shimshak, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, has been retained as counsel. The Debtor listed assets between $100 million and $500 million, and debts between $10 million and $50 million in its filing. Wachovia Bank National Association, Sheila M. Gowan as trustee for Dreier LLP's Chapter 11 Estate, and Steven J. Reisman as post- confirmation representative of the bankruptcy estate of 360networks (USA) Inc. signed a petition that put Mr. Dreier into bankruptcy under Chapter 7 on January 26, 2009 (Bankr. S.D.N.Y. Case No. 09-10371). DUBAI HOLDING: DIC Unit Seeks 3-Month Reprieve from Lenders ----------------------------------------------------------- According to Dow Jones Newswires' Mirna Sleiman and Ainsley Thomson, Dubai International Capital, an investment arm of conglomerate Dubai Holding, has asked lenders for a three-month extension on some of its debts. According to Dow Jones, DIC said in a statement Thursday that the debt extension to September 30 would allow it to implement a "consensual longer-term plan" that would allow it to "maximize the value of its business for the benefit of all its stakeholders." DIC has $2.6 billion of debt maturing by 2011, with $1.25 billion falling due next month, a banker familiar with the matter said Thursday, Dow Jones relates. Dow Jones notes Dubai Holding, which has overall debt of about $12 billion, is controlled by the emirate's ruler Sheikh Mohammed bin Rashid Al Maktoum. According to the report, DIC said it made the debt-extension presentation to its lenders alongside a coordinating committee of banks. The coordinating committee is co-chaired by HSBC Holdings PLC and Emirates NBD PJSC, the banker said, according to Dow Jones. Dow Jones relates that another person familiar with the matter said Deloitte is advising DIC's lenders. The report recalls that earlier in May, several Dubai Holding's subsidiaries -- including Dubai Holding Commercial Operations, which oversees Dubai Holding's property, business-park and hospitality investments; Dubai Group, which is one of Dubai Holding's investment arms; and DIC -- appointed financial advisers ahead of a potential debt restructuring. On Tuesday, Dubai Holding's real estate arm -- Dubai Holding Commercial Operations Group, which owns Dubai Properties Group, TECOM Investments and Jumeirah Group -- announced its audited financial results for the full year ended December 31, 2009. The Wall Street Journal's Stefania Bianchi said DHCOG saw a net loss of 22.8 billion U.A.E. dirhams ($6.2 billion) in 2009 compared with a profit of 10 billion dirhams a year earlier -- raising concerns over the city-state's continuing debt burden. A full-text copy of the earnings release is available at no charge at http://ResearchArchives.com/t/s?63c4 The Journal said Dubai's struggling property market dragged on earnings, and impairment charges at the company, also known as DHCOG, in 2009 almost tripled to 22.5 billion dirhams from 7.6 billion dirhams in 2008. Total revenue in the period under review was 9.5 billion dirhams, down 28% from 13.2 billion dirhams in 2008. "As a result of the measures we took in 2009, DHCOG is well placed to meet its financial obligations in 2010. There is no need to restructure outstanding debt as discussions are taking place with banks to roll over our existing facilities at commercial terms," Chief Executive Ahmad Bin Byat said. E*TRADE FINANCIAL: Owners Agree to 1-for-1- Reverse Stock Split --------------------------------------------------------------- Stockholders authorized the E*TRADE Financial Corporation's Board of Directors to effect a 1-for-10 reverse stock split of the outstanding shares of the Company's common stock. The Company expects the reverse stock split to become effective in early June. Stockholders also voted in favor of the election of the five directors standing for election; a proposal to increase the shares authorized under the Company's 2005 Equity Incentive Plan and to make certain other changes to the plan; and the selection of Deloitte & Touche LLP as the Company's independent public accounting firm. Ronald D. Fisher, President, SoftBank Holdings, Inc.; Steven J. Freiberg, Chief Executive Officer, E*TRADE Financial Corporation; Kenneth C. Griffin, Founder and Chief Executive Officer of Citadel Investment Group, L.L.C.; and Donna L. Weaver, Chairman of MxSecure, Inc.; were each re-elected to Class II of the Company's Board of Directors for a term that will end at the Company's Annual Meeting of Stockholders in 2013. Joseph M. Velli, Chairman and Chief Executive Officer of BNY ConvergEx Group, LLC, was re-elected to Class I of the Company's Board of Directors for a term that will end at the Company's Annual Meeting of Stockholders in 2011. About E*TRADE The E*TRADE FINANCIAL (NASDAQ: ETFC) family of companies provides financial services including trading, investing and related banking products and services to retail investors. Securities products and services are offered by E*TRADE Securities LLC (Member FINRA/SIPC). Bank products and services are offered by E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries. * * * At the end of April 2010, DBRS said it has retained E*TRADE's Issuer & Senior Debt at B (high) and E*TRADE Bank's Deposits & Senior Debt (the Bank) at BB. In March 2010, Standard & Poor's Ratings Services raised its long- term counterparty credit rating on E*TRADE to 'CCC+' from 'CCC'. At the same time, S&P raised its long-term counterparty credit rating on its subsidiary, E*TRADE Bank, to 'B' from 'B-'. The outlook on both is stable. ECHO THERAPEUTICS: Posts $1.9 Million Net Loss in Q1 2010 --------------------------------------------------------- Echo Therapeutics, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $1.9 million on $13,972 of revenue for the three months ended March 31, 2010, compared with a net loss of $1.3 million on no revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $11.9 million in assets, $3.4 million of liabilities, and $8.5 million of stockholders' equity. As reported in the Troubled Company Reporter on April 6, 2010, Wolf & Company, P.C., 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, has a significant accumulated deficit, has a significant working capital deficit and has been unable to raise sufficient capital to fund its operations. As of March 31, 2010, the Company had cash of roughly $1.9 million, a working capital deficit of roughly $1.1 million, and an accumulated deficit of roughly $69.3 million. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63be Franklin, Mass.-based Echo Therapeutics, Inc. is a medical device and specialty pharmaceutical company. The Company is developing a non-invasive, wireless, transdermal continuous glucose monitoring ("tCGM") system for use in clinical settings and for people with diabetes together with a wide range of transdermal reformulations of specialty pharmaceutical products previously approved by the United States Food and Drug Administration. EF JOHNSON TECHNOLOGIES: Earns $190,000 in Q1 2010 -------------------------------------------------- EF Johnson Technologies, Inc.filed its quarterly report on Form 10-Q, reporting net income of $190,000 for the three months ended March 31, 2010, compared with a net loss of $1.6 million for the same period ended March 31, 2009. The improved operating performance relates to higher revenues, improved margins and lower operating expenses. Revenues increased $7.3 million, or 33%, to $29.3 million for the three months ended March 31, 2010, from $22.1 million for the same period in 2009. The increase was attributable to increased State and Local Land Mobile Radio ("LMR") revenues relating to certain delayed shipments from the fourth quarter of 2009 and increases associated with government services revenues, partially offset by lower federal LMR revenues. Michael E. Jalbert, chairman and chief executive officer of EF Johnson Technologies, Inc., said, "We were pleased with our first quarter results which included shipping orders which were delayed in the fourth quarter plus an acceleration of orders previously forecasted for the second quarter; we are therefore anticipating lower second quarter revenues." The Company's balance sheet as of March 31, 2010, showed $95.1 million in assets, $48.1 million of liabilities, and $47.0 million of stockholders' equity. On May 15, 2010, the Company, entered into an Agreement and Plan of Merger with FP-EF Holding Corporation, a Delaware corporation, and FP-EF Corporation, a Delaware corporation and a wholly-owned subsidiary of FP-EF Holding. Under the terms of the merger agreement, FP-EF Corporation will merge with and into the Company, with the Company continuing as the surviving corporation and as a wholly-owned subsidiary of FP-EF Holding. FP-EF Holding is an affiliate of Francisco Partners II, L.P., a global technology- focused private equity fund. Stockholders will receive $1.05 per share in cash for their shares of stock of the Company at which time the Company will be privately held. The merger is subject to normal regulatory approvals, approval by EF Johnson Technologies' stockholders, and other customary closing conditions, and is expected to close during the third quarter of the year. As reported in the Troubled Company Reporter on April 6, 2010, Grant Thornton LLP, in Dallas, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred substantial net losses in each of the last three years and has a $15.0 million term loan due on June 30, 2010. On May 15, 2010, EF Johnson Technologies, Inc., entered into a Seventh Amendment effective as of May 15, 2010, to its Revolving Line of Credit Loan Agreement, Term Loan Agreement and Security Agreement with Bank of America, N.A. to extend the maturity of the Loan Agreement until August 31, 2010, to allow the Company to consummate the merger with FP-EF Holding. The Lender also waived compliance with certain financial covenants contained in the Loan Agreement for the Company's fiscal quarter ending June 30, 2010, on a one-time basis. In consideration of the Lender's agreement, the Company agreed to pay down the outstanding principal balance of the term loan portion of the Loan Agreement from $15.0 million to $5.0 million on June 17, 2010. The parties further amended the Loan Agreement to increase the revolving line of credit from $3.75 million to $6.0 million effective June 17, 2010. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63bc A full-text copy of the press release is available for free at: http://researcharchives.com/t/s?63bd Irving, Tex.-based EF Johnson Technologies, Inc. (NASDAQ: EFJI) -- http://www.EFJohnsonTechnologies.com/-- focuses on innovating, developing and marketing the highest quality secure communications solutions to organizations whose mission is to protect and save lives. The Company's customers include first responders in public safety and public service, the federal government, and industrial organizations. ESCADA AG: Taxing Authorities Oppose Plan Confirmation ------------------------------------------------------ Dallas County and San Marcos Consolidated Independent School District contends that the Joint Chapter 11 Plan of Liquidation delivered by ESCADA (USA), Inc., now known as EUSA Liquidation Inc., to the U.S. Bankruptcy Court for the Southern District of New York on April 29, 2010, "does not provide for payment of statutory interest on Texas Taxing Authorities' fully secured prepetition claims." The Texas Taxing Authorities' Claims are classified under Class 2 Allowed Miscellaneous Secured Claims in the Plan. However, this treatment "fails to provide fair and equitable treatment to these secured claims as required by Sections 1129(b)(1) and (2)(A) [of the Bankruptcy Code,]" Diane S. Sanders, Esq., at Linebarger Goggan Blair & Sampson, LLP, in Austin, Texas, complains. "If the Debtor intends to pay the Texas Taxing Authorities' claims without the required statutory interest from the date of filing of this case until the claims are paid in full, then the Plan violates the provisions of Section 1129(a)(7)," Ms. Sanders maintains. Furthermore, she points out, the Plan fails to provide that the Claims are entitled to express retention of all property tax liens until they have been paid in full. The laws of the State of Texas and the Property Tax Code give the tax liens securing property taxes superior claims over any other claim or lien against this property, according to Ms. Sanders. The Texas Taxing Authorities also insist that they require clarification that if their Claims are not timely paid prior to delinquency on February 1, 2011, they will accrue penalties and interest as provided under Section 503 of the Bankruptcy Code until they have been paid in full. In a separate objection, the County of Hays, Texas, contends that their secured claims are entitled to express retention of all property tax liens, including those for the postpetition 2010 tax year, until all taxes, penalties and interest protected by those liens have been paid. Clarification is necessary to assure that the taxes for the 2010 tax year are deemed to be ordinary course expenses, to be timely paid, without the necessity of claims being filed or requests for payment, Hays County insists. The County's tax claims are entitled to statutory interest at the rate provided under Texas law pursuant to Section 511 of the Bankruptcy Code from the Petition Date until paid in full, Michael Reed, Esq., at McCreary, Veselka, Bragg & Allen, P.C., in Round Rock, Texas, asserts. The Chapter 11 Plan Escada USA won approval of the disclosure statement explaining its liquidating Chapter 11 plan. It will present the Plan for confirmation at a hearing on June 8. Escada USA, now known as EUSA Liquidating Inc. following the sale of its business in January, is promising unsecured creditors owed a total of $370 million 3% to 8% recovery on their claims. Tax claims of $2.9 million will be paid in full. About Escada AG The ESCADA Group -- http://www.escada.com/-- is an international fashion group for women's apparel and accessories, which is active on the international luxury goods market. It has pursued a course of steady expansion since its founding in 1976 by Margaretha and Wolfgang Ley and today has 182 own shops and 225 franchise shops/corners in more than 60 countries. As of August 10, 2009, the Escada Group operated 176 owned stores and so-called shop in shops, of which 26 owned stores are located in the United States and operated by Escada (USA) Inc. and 2 stores are planned to be opened in the United States before year end. Escada Group products are also sold in 163 stores worldwide which are operated by franchisees. Escada Group had total assets of EUR322.2 million against total liabilities of EUR338.9 million as of April 30, 2009. Wholly owned subsidiary Escada (USA) Inc. filed for Chapter 11 on August 14, 2009 (Bankr. S.D.N.Y. Case No. 09-15008). Judge Stuart M. Bernstein handles the case. O'Melveny & Myers LLP has been tapped as bankruptcy counsel. Kurtzman Carson Consultants serves as claims and notice agent. Escada US listed US$50 million to US$100 million in assets and US$100 million to US$500 million in debts in its petition. Bankruptcy Creditors' Service, Inc., publishes Escada USA Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Escada USA, and the insolvency proceedings of ESCADA AG and its units. (http://bankrupt.com/newsstand/or 215/945-7000) ESCADA AG: Subco Wants to Enforce Sale Order on Traynor & M&M ------------------------------------------------------------- ESCADA US Subco, LLC, relates that it was served on March 29, 2010, with a summons and verified complaint dated February 23, 2010, with respect to a state court proceeding captioned Traynor v. Fashion Outlets of Niagra LLC, et al., litigated in the New York Supreme Court in New York County. The Traynor Complaint concerns an alleged "slip-and-fall" incident in June 2009 at a Niagara, New York facility, which was then operated by Debtor ESCADA (USA) Inc., now known as EUSA Liquidation Inc. ESCADA Subco is the purchaser of substantially all of the assets of EUSA Liquidation pursuant to an Asset Purchase and Sale Agreement among the parties dated December 21, 2009. Under the Asset Sale Agreement, ESCADA USA was contemplated to (i) receive US$6 million; (ii) have certain of its liabilities assumed by the Purchaser; and (iii) receive reimbursement for new inventory it purchased from and after the execution of the Agreement. The Sale was approved by Bankruptcy Judge Arthur J. Gonzales for the Southern District of New York on January 7, 2010. The closing of the Sale occurred on January 15. Sean A. O'Neal, Esq., at Cleary Gotlieb Steen & Hamilton LLP, in New York, relates that the lease governing the Niagara Premises was assigned to ESCADA Subco, as purchaser, on the Closing pursuant to the Sale Order. Mr. O'Neal further relates that on May 4, 2010, ESCADA Subco was served with the verified answer and cross-claim of M&M Electric Construction Co., Inc. According to the Complaint's allegations, M&M Electric was directing or performing construction work at the Niagara Premises in June 2009 at the time of the alleged accident. The Cross-Claim asserts that to the extent the Plaintiff sustained damages, it was due to the "primary recklessness" or "negligence" of ESCADA Subco, as the purchaser. The Cross-Claim demands judgment over and against ESCADA Subco in the amount of any judgment obtained against M&M Electric, together with costs. According to Mr. O'Neal, ESCADA Subco has made every effort to consensually resolve Mr. Traynor and M&M Electric's Claims by explaining the applicable provisions of the Sale Order. However, the Claimants have refused to discontinue or withdraw their claims against ESCADA Subco. By this motion, ESCADA Subco asks Judge Stuart M. Bernstein of the U.S. Bankruptcy Court for the Southern District of New York to enjoin and prohibit the Claimants from pursuing any of the claims asserted in the Complaint and the Cross-Claim against it. The Sale Order, Mr. O'Neal elaborates, expressly provides that the Transferred Assets were transferred "to the Purchaser, free and clear of any Interests or Excluded Liabilities of any kind whatsoever." Hence, he contends, the Claimants' continued pursuit of the causes of action asserted in the Complaint and the Cross-Claim is in direct contravention of this Court's Sale Order. Moreover, the Claimants have not articulated any basis under which they may pursue their claims against the Purchaser in light of the clear and unambiguous provisions of the Sale Order, he explains. ESCADA Subco adds that it reserves its rights to seek contempt sanctions against the Claimants for costs and expenses based on their refusal to abide by the clear and unambiguous terms of the Sale Order. In a separate declaration filed with the Court, Luke A. Barefoot, Esq., an associate at Cleary Gottlieb, submitted these exhibits relating to ESCADA Subco's Motion: * A letter dated April 7, 2010, in which the landlord for the Niagara Premises, through its insurer, made a demand on the Purchaser for indemnity and defense against the Traynor Action * A letter dated May 4, 2010, in which the Purchaser's counsel explained to the Landlord that the Demand was barred by their terms The Court will convene a hearing on the Motion on June 15, 2010. Objections, if any, are due no later than June 10. Valley Forge Seeks Relief From Stay to Pursue Coverage In a letter addressed to the Bankruptcy Court, Valley Forge Insurance Company, an insurer of Fashion Outlets of Niagara LLC, doing business as Fashion Outlets of Niagara Falls, sought permission from Judge Bernstein to assert a claim against ESCADA (USA), Inc. with respect to the Traynor Action, to the extent of any insurance coverage available. Valley Forge's insurance coverage pursuit is "for defense and indemnity of the Traynor [Action], inclusive of any cross-claims that Fashion Outlet may want to assert against Escada USA, who leased the relevant store premises from Fashion Outlet, and agreed in the applicable lease to defend and indemnity Valley Forge's insured, Fashion Outlet, and to procure insurance for Fashion Outlet," Marian S. Hertz, Esq., at Colliau Elenius Murphy Carluccio Keener & Morrow, in New York, wrote. If insurance coverage is not available to the Debtors, Valley Forge seeks leave to assert a claim in the Debtor's Chapter 11 cases for any costs it may incur in the defense and indemnity of Fashion Outlets in the Traynor Action, which costs it insists should have been assumed by the Debtor per its lease. * * * Judge Bernstein entered a memorandum order dated May 12, 2010, saying that the Bankruptcy Court "does not grant" the request for relief from the automatic stay under Section 362(d)(1) of the Bankruptcy Code. "Any party seeking Stay relief must make a motion in accordance with the Bankruptcy Code and Rules," Judge Bernstein wrote. About Escada AG The ESCADA Group -- http://www.escada.com/-- is an international fashion group for women's apparel and accessories, which is active on the international luxury goods market. It has pursued a course of steady expansion since its founding in 1976 by Margaretha and Wolfgang Ley and today has 182 own shops and 225 franchise shops/corners in more than 60 countries. As of August 10, 2009, the Escada Group operated 176 owned stores and so-called shop in shops, of which 26 owned stores are located in the United States and operated by Escada (USA) Inc. and 2 stores are planned to be opened in the United States before year end. Escada Group products are also sold in 163 stores worldwide which are operated by franchisees. Escada Group had total assets of EUR322.2 million against total liabilities of EUR338.9 million as of April 30, 2009. Wholly owned subsidiary Escada (USA) Inc. filed for Chapter 11 on August 14, 2009 (Bankr. S.D.N.Y. Case No. 09-15008). Judge Stuart M. Bernstein handles the case. O'Melveny & Myers LLP has been tapped as bankruptcy counsel. Kurtzman Carson Consultants serves as claims and notice agent. Escada US listed US$50 million to US$100 million in assets and US$100 million to US$500 million in debts in its petition. Bankruptcy Creditors' Service, Inc., publishes Escada USA Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Escada USA, and the insolvency proceedings of ESCADA AG and its units. (http://bankrupt.com/newsstand/or 215/945-7000) ESCADA AG: Subco Opposes Sensitive Info on 717 GFC Trial -------------------------------------------------------- ESCADA US Subco, LLC, asks Judge Bernstein to preclude 717 GFC LLC from attempting to elicit certain commercially sensitive testimony, which the Bankruptcy Court has already determined is "irrelevant" to ESCADA Subco's request to enjoin Landlord 717 GFC LLC from taking any action to terminate the lease related to Subco's flagship retail store located at 717 Fifth Avenue, in New York. To recall, ESCADA Subco, as the purchaser of substantially all of the assets of Debtor ESCADA (USA) Inc., now known as EUSA Liquidation Inc., noted that among the assets to be transferred to it under the Asset Sale Agreement was the Fifth Avenue Lease between a predecessor-in-interest to the Landlord and the Debtor dated as of September 29, 2000, as amended. Sean A. O'Neal, Esq., at Cleary Gotlieb Steen & Hamilton LLP, in New York, relates that in connection with the assumption and assignment of the Fifth Avenue Lease to the Purchaser, the Purchaser offered to provide Landlord a replacement guarantee issued by guarantor ESCADA Luxembourg, S.a.r.l. or ESCADA Lux. At the hearing to approve the Sale of EUSA Liquidation's assets to ESCADA Subco, the Court determined that, among other things, the Replacement Guarantee from ESCADA Lux provided the Landlord with adequate assurance of future performance within the meaning of Sections 365(b)(1)(C) and 365(f)(2)(B) of the Bankruptcy Code, Mr. O'Neal recounts. However, Mr. O'Neal continues, by notices of default dated January 27 and February 12, 2010, the Landlord "belatedly challenged" the adequacy of the Replacement Guarantee, alleging that notwithstanding the Court's findings in the Sale Order and the absence of any requirement in the Fifth Avenue Lease, the Purchaser was required to provide a guarantee from an entity with equal net worth to the Debtor's guarantor at the time of entry into the Lease. Accordingly, the Purchaser sought to enforce the Court's Sale Order to preclude the Landlord from terminating the Fifth Avenue Lease based on claims as to the inadequacy of the Replacement Guarantee. At the hearing held last March 19, 2010, the Court agreed that the Landlord was bound by the Court's prior adequate assurance determination. As discussions between the parties immediately following the March 19 Hearing did not resolve the issues raised by the Motion, the Court scheduled a status conference for May 4, 2010, which was subsequently adjourned until June 22, 2010 to further permit the parties the opportunity to explore settlement, Mr. O'Neal reveals. As the Court has already made clear, only the conversion of a portion of the Shareholder Loan to ESCADA Lux is relevant to a determination on ESCADA Subco's Motion, Mr. O'Neal asserts. There is simply no relationship between this issue and other aspects of the current balance sheet of ESCADA Lux other than the Shareholder Loan, he maintains. Accordingly, the Landlord should be precluded from eliciting or introducing evidence relating to ESCADA Lux's financial condition, Mr. O'Neal insists. Permitting the Purchaser to inquire into the current financial condition of ESCADA Lux, or to otherwise explore ESCADA Lux's balance sheet beyond the Shareholder Loan would both reveal confidential information and inappropriately give Landlord discovery into its purported state law claims, Mr. O'Neal points out. As ESCADA Lux is not a public company, testimony on its current balance sheet or finances could reveal confidential and commercially sensitive information about ESCADA Lux that is not otherwise available, Mr. O'Neal continues. More troublingly, he adds, it would permit the Landlord to essentially obtain discovery into its unfounded claim that even if adequate assurance were given at the time of entry of the Sale Order, the Landlord may nonetheless pursue claims if ESCADA Lux's financial condition changes in the future. The Court will convene a hearing on the Motion on June 15, 2010. Objections, if any, are due no later than June 10. About Escada AG The ESCADA Group -- http://www.escada.com/-- is an international fashion group for women's apparel and accessories, which is active on the international luxury goods market. It has pursued a course of steady expansion since its founding in 1976 by Margaretha and Wolfgang Ley and today has 182 own shops and 225 franchise shops/corners in more than 60 countries. As of August 10, 2009, the Escada Group operated 176 owned stores and so-called shop in shops, of which 26 owned stores are located in the United States and operated by Escada (USA) Inc. and 2 stores are planned to be opened in the United States before year end. Escada Group products are also sold in 163 stores worldwide which are operated by franchisees. Escada Group had total assets of EUR322.2 million against total liabilities of EUR338.9 million as of April 30, 2009. Wholly owned subsidiary Escada (USA) Inc. filed for Chapter 11 on August 14, 2009 (Bankr. S.D.N.Y. Case No. 09-15008). Judge Stuart M. Bernstein handles the case. O'Melveny & Myers LLP has been tapped as bankruptcy counsel. Kurtzman Carson Consultants serves as claims and notice agent. Escada US listed US$50 million to US$100 million in assets and US$100 million to US$500 million in debts in its petition. Bankruptcy Creditors' Service, Inc., publishes Escada USA Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Escada USA, and the insolvency proceedings of ESCADA AG and its units. (http://bankrupt.com/newsstand/or 215/945-7000) EXELTECH AEROSPACE: Files Assignments in Bankruptcy --------------------------------------------------- ExelTech Aerospace Inc. (TSX Venture: XLT) said May 28 that it and its subsidiaries, ExelTech Canada Inc. and ExelTech YUL Inc., have not sought a further extension of the period in which to file a proposal under the Bankruptcy and Insolvency Act (Canada), which expires May 28. As a consequence, ExelTech Aerospace Inc., ExelTech Canada Inc. and ExelTech YUL Inc. will each be deemed to have filed assignments in bankruptcy. In light of the foregoing, the directors of ExelTech Aerospace have resigned. RSM Richter Inc. is the trustee in bankruptcy. EXTENDED STAY: Expected to Emerge from Bankruptcy in September -------------------------------------------------------------- A group of investors led by Centerbridge Partners LP won the bidding for the assets of Extended Stay, The New York Times reported, citing people briefed on the matter. The group, which also includes Paulson & Co., and Blackstone Real Estate Associates VI L.P., offered to acquire the Extended Stay asset for about $3.925 billion. The Centerbridge group beat out another bidder led by Starwood Capital Group and TPG by less than $40 million at an auction held on May 27, the report noted. The auction, which drew about 150 bankers, lawyers and investing executives, was conducted at the Midtown Manhattan offices of Extended Stay's bankruptcy counsel, Weil Gotshal & Manges LLP. News reports cite that the auction lasted nearly 19 hours. Bloomberg News noted that the auction started 10 a.m. on May 27 and lasted through 5 a.m. the next day. Through approximately 11 rounds of bidding, Centerbridge and Starwood groups raised their offers and added sweeteners, including making all-cash offers, according to The New York Times. The Centerbridge group's offer will give it 100% of the equity in Extended Stay when it emerges from bankruptcy protection. It is expected to pay off the hotel chain's $4.1 billion mortgage loan. Meanwhile, holders of Extended Stay's $3.3 billion in mezzanine debt will not receive any value from the bid, according to a report by Bloomberg News. The $4.1 billion pre-bankruptcy loan was used to acquire Extended Stay from Blackstone Group LP way back in 2007. The loan was availed from Bear Stearns Commercial Mortgage Inc. and two U.S. banks by an investment consortium led by Lightstone Group LLC Chairman David Lichtenstein. The Centerbridge bid is subject to approval by the U.S. Bankruptcy Court for the Southern District of New York, which oversees Extended Stay's bankruptcy case. Extended Stay is expected to emerge from bankruptcy protection by the end of September, according to the New York Times report. GlobeSt.com quoted advisory firm REH Capital Partners LLC chief executive Frank Nardozza as saying that the selected Centerbridge offer will pave the way for Extended Stay to have "a clearer direction and get back to normal with regard to strategic planning for stabilization, growth and marketing." About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: Proposes to Pay $9-Mil. Break-Up Fee to Starwood --------------------------------------------------------------- Extended Stay Inc. seeks permission from the U.S. Bankruptcy Court for the Southern District of New York to pay $9,150,394, to a group of investors led by Starwood Capital. ESI made the move in light of the termination of its agreement with the Starwood investors for the sponsorship and funding of a plan of reorganization for ESA Properties LLC and its 73 other debtor affiliates. The Starwood Agreement was terminated after ESI accepted a new offer from another group of investors composed of Centerbridge Partners LP, Paulson & Co., and Blackstone Real Estate Associates VI L.P. Under the Starwood Agreement, ESI is required to seek Court approval to earmark as much as $10 million to pay the costs incurred by the Starwood investors in the event ESI accepts an offer from another group that does not exceed the minimum bid increment provided in the Agreement. The Starwood investors incurred costs, which include fees and expenses of their professionals, in connection with the due diligence and negotiation of the Starwood Agreement. The Starwood professionals include Greenberg Traurig LLP, which sought payment of more than $3.90 million, and Deloitte & Touche, which sought payment of over $1.029 million. The Court will consider approval of the proposed Starwood payment at a June 17, 2010 hearing. Deadline for filing objections is June 11, 2010. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: Examiner Proposes Process to Terminate Appointment ----------------------------------------------------------------- Ralph Mabey, the Court-appointed bankruptcy examiner, seeks permission from Judge Peck to implement a process related to the termination of his appointment as examiner and the conclusion of his investigation into the Chapter 11 cases of Extended Stay Inc. and its affiliated debtors. Mr. Mabey specifically seeks the Bankruptcy Court's assistance in connection with these issues: (1) The disposition of documents that he has obtained in his role as examiner; (2) Prohibition of discovery from the examiner and his professionals to avoid needless motion practice with respect to the discoverability of information obtained during the course of the investigation; and (3) Exculpation of the examiner and his professionals in a manner that is consistent with the proposed exculpation of the Debtors' and the Official Committee of Unsecured Creditors' professionals in section 10.9 of the Fourth Amended Plan of Reorganization or any equivalent provision in any amended or superseding plan that may be confirmed in the Debtors' cases. Mr. Mabey says that during the course of his investigation, he obtained more than 20,000 documents, some of which were provided under claims of confidentiality governed by agreements that curtail his ability to transfer the documents to a third party. In addition, Mr. Mabey has transcripts of three depositions, each of which was designated as confidential. All these documents are stored in a secure electronic document repository or so-called "catalyst" as stated in the work plan, Mr. Mabey reveals. Maintaining the document repository costs about $2,600 per month in license fees plus hourly consulting fees catalyst charges for custom requests related to the repository and any professional fees that would be incurred to direct the catalyst's activities, according to Mr. Mabey. Although only a portion of the documents was referenced or relied upon in the examiner report, certain parties might legitimately pursue the same discovery that has already been obtained through the investigation, according to Mr. Mabey's attorney, Margreta Morgulas, Esq., at Stutman Treister & Glatt Professional Corporation. Ms. Morgulas stressed that a part of the U.S. Trustee's reason for asking the appointment of an examiner was that the Court might order the examiner to share materials obtained during the investigation thus saving the estates money by eliminating duplicative discovery. "The examiner seeks to minimize the potential that discovery efforts will be duplicated, reduce the ongoing cost of maintaining a document repository, and terminate his responsibility for the documents as he ends his role in these cases," Ms. Morgulas says in court papers. She adds that these goals can be accomplished by transferring responsibility for the catalyst repository to a party with an active role in the Debtors' cases. Mr. Mabey proposes these three alternative procedures by which the catalyst document repository might be used efficiently at the least expense to the Debtors' estates: (1) Alternative A Proposal "Alternative A" proposal contemplates that Mr. Mabey would provide the Creditors Committee with a list that names all the documents stored in the catalyst repository, and relates the name of the document to its unique identifying number assigned by catalyst. Based on the Master Document List, the Creditors Committee would present any demand for access to specific documents directly to the party that initially produced those documents to the examiner. The Creditors Committee and that party would resolve any claims of privilege or confidentiality without the examiner's involvement. Within 45 days of service, the Creditors Committee would provide the examiner with a list of the documents identified by Catalyst ID Number in either a writing signed by both the Creditors Committee and the party, or a court order. The Maintained Document List A will be deemed to comprise the population of documents to be maintained in the catalyst. After 45 days from service of the Master Document List on the Creditors Committee, all documents that remain subject to claims of privilege or confidentiality would be deleted from the catalyst and full access to and responsibility for the catalyst repository would be transferred to the Creditors Committee. (2) Alternative B Proposal "Alternative B" proposal contemplates that the Alternative A procedure would essentially be employed but with respect to a considerably smaller subset of documents referenced in the examiner's report. Under Alternative B, the examiner would provide the Creditors Committee with a list that only names the documents relied upon in the report, stored in the catalyst repository and subject to claims of privilege or confidentiality. The Report Document List would relate the name of each document to its unique identifying number assigned by the catalyst. Based on the list, the Creditors Committee may present any demand for access to specific documents directly to the party producing the documents. The Creditors Committee and that party would resolve any claims of privilege or confidentiality without the examiner's involvement. Within 45 days of service, the Creditors Committee would provide the examiner with a list of the documents identified by Catalyst ID Number in either a writing signed by both the Creditors Committee and the party producing the documents, or a court order. The Report Document List A would be deemed to comprise the population of documents to be maintained in the catalyst. After 45 days from service of the Report Document List on the Creditors Committee, all documents that remain subject to claims of privilege or confidentiality and not provided for in the Report Document List A will be deleted from the catalyst and full access to and responsibility for the catalyst repository, with all remaining documents, will be transferred to the Creditors Committee. (3) Alternative C Proposal "Alternative C" proposal contemplates that the examiner would terminate the catalyst, thus deleting all of the documents stored in the catalyst repository. If the Court issues an order adopting this proposal, the examiner would request that the order authorize him to delete or destroy all documents obtained in connection with his duties. The Court will consider approval of one of the proposed procedures at a hearing set for June 17, 2010. Deadline for filing objections is June 11, 2010. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). FIRST AMERICAN: Fitch Withdraws 'BB+' Ratings on Two Senior Notes ----------------------------------------------------------------- Fitch Ratings has affirmed the 'A-' Insurer Financial Strength ratings of the First American Insurance Companies. Additionally, following the spin-off from the group by First American Financial Corporation, Fitch has assigned a 'BBB' Issuer Default Rating to FAF and a 'BBB-' rating to its $400 million revolving credit line. The Rating Outlook for all ratings is Negative. Fitch's affirmation of First American's ratings is a reflection of the company's improved capitalization, profitability, and high quality investment portfolio. On a consolidated basis, First American's year end 2009 Risk Adjusted Capital ratio improved substantially to approximately 160% from 112% prior year. Additionally, the company's operating and net leverage have improved year-over-year as statutory policyholder surplus increased 33% to $802 million at year end 2009. While the organic growth in surplus is a credit positive, the biggest source of the growth came from net investment income instead of operating earnings as the mortgage origination market remains challenged which increases the likelihood of weaker near-term title insurance revenue and profit margins. Fitch does note that approximately 75% of the $177 million net investment income was due from subsidiary dividends. Fitch's decision to assign a 'BBB' IDR to FAF is based on the company's Dec. 31, 2009 pro forma tangible financial leverage of 26% and earnings based interest coverage of 10.5 times. Fitch does not anticipate a material deviation of these metrics over the next 12 to 18 months. The Negative Outlooks are indicative of negative trends in the title insurance industry and concerns for how FAF will perform without the benefit of CoreLogic during the current economic cycle. Fitch notes that without the support of CoreLogic over the past several years FAF's ratings likely would have been lowered. In particular, Fitch will closely monitor FAF's run rate operating margins, capital position, and reserve strength over the next 12 to 18 months to determine if the company's credit profile is consistent with the current ratings level. If Fitch concludes that the company is operating in a manner inconsistent with its current rating category Fitch would likely lower the ratings. Fitch has assigned these ratings with a Negative Outlook: The First American Financial Corporation -- IDR 'BBB'; -- Three-year $400 million Revolving Bank Line of Credit 'BBB-'. Fitch has affirmed the 'A-' IFS rating with a Negative Outlook for these entities: First American Title Insurance Company First American Title Insurance Co. of New York First Title Insurance, PLC. Ohio Bar Title Insurance Co. Pacific Northwest Title Ins Co Fitch has withdrawn these ratings due to a lack of information on a go forward basis: The First American Corporation -- IDR 'BBB-'; -- $200 million senior unsecured notes due 2014 'BB+'; -- $100 million senior unsecured debentures due 2028 'BB+'. First American Capital Trust -- $100 million trust preferred security due 2012 'BB'. FIRST FEDERAL BANCSHARES: Earns $905,000 in Q1 2010 --------------------------------------------------- First Federal Bancshares of Arkansas, Inc., filed its quarterly report on Form 10-Q, reporting net income of $905,000 for the three months ended March 31, 2010, compared with a net loss of $1.5 million for the same period ended March 31, 2009. "The increase in net income for the three months ended March 31, 2010, was primarily due to an improvement in the Bank's net interest margin and a decrease in the provision for loan losses, partially offset by an increase in noninterest expenses." Larry J. Brandt, CEO for the Company said, "We are pleased to report net income of $905,000 for our first quarter of 2010. We continue to aggressively deal with our nonperforming assets with $4.6 million of real estate owned properties sold during the first quarter and another $4.5 million under contract to be sold in the second quarter. In addition, we continue to focus on reducing our operating expenses to help sustain our profitability for the year. Raising our capital levels by year end continues to be a strategic priority for the Bank and we are currently looking at measures to achieve that goal." Net interest income increased from $4.7 million for the three months ended March 31, 2009, to $5.6 million for the three months ended March 31, 2010. Net interest margin for the three months ended March 31, 2010, was 3.42% compared to 2.65% for the same period in 2009. The increase in net interest income for the three month comparison period was primarily due to a decrease in rates paid on deposits and borrowings and an increase in the average yield earned on loans receivable, offset by a decrease in the average balance of loans receivable. The provision for loan losses decreased $3.5 million to $53,000 for the three month period ended March 31, 2010, compared to $3.5 million for the three month period ended March 31, 2009. The decrease in the provision for loan losses was primarily due to a decrease in net loans receivable. Noninterest expenses increased $753,000 or 12.9% to $6.6 million for the three months ended March 31, 2010, compared to $5.8 million for the same period in 2009. The Company's balance sheet as of March 31, 2010, showed $696.9 million in assets, $652.9 million of liabilities, and $44.0 million of stockholders' equity. This compares with assets of $731.1 million, liabilities of $687.8 million and stockholders' equity of $43.3 million at December 31, 2009. At March 31, 2010, compared to December 31, 2009, investment securities decreased by $16.3 million or 12.0% due to issuers' calls of securities. Real Estate Owned, net ("REO") decreased by $1.5 million or 4.4% to $33.6 million or 4.8% of total assets. Net loans receivable decreased $21.4 million or 4.5%, primarily due to repayments, transfers to REO and a decrease in loan originations. Nonperforming assets amounted to $80.2 million or 11.5% of total assets at March 31, 2010, compared to $78.0 million or 10.7% of total assets at December 31, 2009. At March 31, 2010, nonperforming assets consisted primarily of $46.6 million of nonaccrual loans, net of specific valuation allowances, and $33.6 million in real estate owned. As reported in the Troubled Company Reporter on April 21, 2010, Deloitte & Touche LLP, in Little Rock, Ark., 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 of the Company's significant operating losses in 2009, significant levels of criticized assets, and decline in capital levels. On April 12, 2010, the Company and the Bank each consented to the terms of Cease and Desist Orders issued by the Office of Thrift Supervision. The Orders impose certain operations restrictions on the Company and, to a greater extent, the Bank, including lending and dividend restrictions. The Orders also require the Company and the Bank to take certain actions, including the submission to the OTS of capital plans and business plans to, among other things, preserve and enhance the capital of the Company and the Bank and strengthen and improve the consolidated Company's operations, earnings and profitability. The Bank Order specifically requires the Bank to achieve and maintain, by December 31, 2010, a tier 1 (core) capital ratio of at least 8% and a total risk-based capital ratio of at least 12.0% and maintain these higher ratios for as long as the Bank Order is in effect. At March 31, 2010, the Bank's core and total risk-based capital ratios were 6.17% and 10.64%. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63b8 A full-text copy of the press release is available for free at: http://researcharchives.com/t/s?63b9 Harrison, Ark.-based First Federal Bancshares of Arkansas, Inc. -- http://www.ffbh.com/-- is a unitary savings and loan holding company for First Federal Bank. First Federal Bank is a community bank serving consumers and businesses with a full range of checking, savings, investment and loan products and services. The Bank, founded in 1934, conducts business from 20 full-service branch locations, one stand-alone loan production office, and 31 ATMs located in Northcentral and Northwest Arkansas. FLYING J: Amended Plan Pays Creditors & Owners in Full ------------------------------------------------------ Flying J Inc. has filed an updated version of its reorganization plan that contemplates paying off all creditors in cash and reinstating the debtors' equity, saying in court papers that it is on the brink of emerging from Chapter 11, Bankruptcy Law360 reports. Law360 says the debtors filed a joint reorganization plan and disclosure statement in the U.S. Bankruptcy Court for the District of Delaware on Friday. Based in Ogden, Utah, Flying J Inc. -- http://www.flyingj.com/-- is among the 20 largest private companies in America, with 2007 sales exceeding $16 billion. The fully integrated oil company employs approximately 14,700 people in the U.S. and Canada through its interstate operations, transportation, refining and supply, exploration and production, as well as its financial services and communications, divisions. Flying J and six of its affiliates filed for bankruptcy on December 22, 2008 (Bankr. D. Del. Lead Case No. 08-13384). Flying J sought Chapter 11 protections after a precipitous drop in oil prices and disruption in the credit markets brought to bear significant short-term pressure on the company's liquidity position. Attorneys at Kirkland & Ellis LLP represent the Debtors as counsel. Young, Conaway, Stargatt & Taylor LLP is the Debtors' Delaware Counsel. Blackstone Advisory Services L.P. is the Debtors' investment banker and financial advisor. Epiq Bankruptcy Solutions LLC is the Debtors' notice, claims and balloting agent. In its formal schedules submitted to the Bankruptcy Court, Flying J listed assets of $1,433,724,226 and debts of $640,958,656. An official committee of unsecured creditors has been appointed in the case. Pachulski Stang Ziehl & Jones LLP has been tapped as counsel for the creditors' panel. FONTAINEBLEAU LV: Court Throws Out Plaintiffs' MDL Claims --------------------------------------------------------- Bankruptcy Law360 reports that a federal judge has thrown out the lion's share of claims by plaintiffs in two cases that are part of the multidistrict litigation alleging a group of lenders, including Bank of America NA, unfairly cut off financing to Fontainebleau Las Vegas Holdings LLC's casino resort project. In a ruling Friday, Law360 says, Judge Alan S. Gold of the U.S. District Court for the Southern District of Florida threw out three of the plaintiffs' claims. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleu Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC and its units filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represented the Debtors in their restructuring effort. The Debtors' claims agent is Kurtzman Carson Consulting LLC. Attorneys at Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP, represent the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. In February 2010, Icahn Enterprises L.P. acquired from Fontainebleau Las Vegas and certain affiliated entities, the Fontainebleau property and improvements thereon located in Las Vegas, Nevada, for an aggregate purchase price of approximately $150 million. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FORD MOTOR: Has Green Light to Shutter Mercury Brand ---------------------------------------------------- The Wall Street Journal's Matthew Dolan reports that according to a person familiar with the matter said Ford Motor Company will shut its Mercury brand after its board of directors voted to phase out the 71-year old nameplate. The source, Mr. Dolan relates, said Ford has scheduled a news conference for later Wednesday where it will outline its Mercury plan. The Journal relates Ford Chief Executive Alan Mulally and his top lieutenants recently won the backing of key members of the Ford family to kill Mercury after years of dwindling sales. Its sales fell another 10.7% for May compared with the same month last year, Ford reported Wednesday. The Journal also relates that the hundreds of dealers that sell only Lincolns and Mercurys may find it difficult to continue without the volume from Mercury. A person familiar with the matter at Ford said the company hopes to merge many of those dealers with existing Ford dealerships or shut them. Mercury had 1,780 U.S. dealers at the end of 2009, the Journal says. About Ford Motor Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles across six continents. With about 176,000 employees and about 80 plants worldwide, the company's automotive brands include Ford, Lincoln, Mercury and, until its sale, Volvo. The company provides financial services through Ford Motor Credit Company. The Company's balance sheet at March 31, 2010, showed $191.9 billion in total assets and $197.4 billion total liabilities, for a stockholders' deficit of $5.4 billion. * * * According to the Troubled Company Reporter on May 21, 2010, Moody's Investors Service upgraded the ratings of Ford Motor Company and Ford Motor Credit Company. Ratings raised include Ford's Corporate Family Rating and Probability of Default Rating to B1 from B2, secured credit facility to Ba1 from Ba2, senior unsecured debt to B2 from B3, and trust preferred to B3 from Caa1. The Speculative Grade Liquidity rating remains at SGL-2. Also raised are Ford Credit's CFR and senior debt rating to Ba3 from B1. The rating outlook for Ford and Ford Credit is stable. On March 4, 2009, Ford deferred future interest payments on its 6.50% Junior Subordinated Convertible Debentures due January 15, 2032, beginning with the April 15, 2009 quarterly interest payment. On Nov. 3, 2009, S&P raised the corporate credit ratings on Ford Motor Co. and Ford Motor Credit Co. LLC to 'B-' from 'CCC+'. Ford Motor Co. carries a long-term issuer default rating of 'CCC', with a positive outlook, from Fitch Ratings. FORD MOTOR: U.S. May 2010 Sales Up 23% From Last Year ----------------------------------------------------- Ford Motor Company said Wednesday it continued to post strong sales and market share gains in May, with Ford, Lincoln and Mercury dealers delivering 192,253 new vehicles in May -- a 23% increase versus a year ago. It marks the sixth month in a row Ford sales have increased more than 20%. Year-to-date sales totaled 783,845, up 31%. In May, Ford retail sales were up 19% versus a year ago, and Ford gained retail market share for the 19th time in the last 20 months. Fleet sales were up 32%, primarily reflecting higher sales of Ford's hard-working trucks to commercial customers. Ford is benefiting from a fresh lineup of new, fuel-efficient, high-quality vehicles that deliver industry-leading levels of safety as well as smart design and value. "Our laser focus on fuel efficiency and quality is paying off for our customers and for Ford," said Ken Czubay, Ford vice president, U.S. Marketing Sales and Service. "Our customers are rewarded because Ford resale values continue to increase at a rate higher than the overall industry -- and they are rewarding us with increased purchase consideration." In April, year-over-year resale values of Ford, Lincoln and Mercury vehicles outpaced the industry. Resale values improved 24% for Ford versus 19% for the industry, based on auction data compiled by the North American Dealers Association. The margin of improvement was particularly strong on cars, where Ford improved seven points more than the industry average. Ford also achieved the largest gain of any automaker in Automotive Lease Guide's latest Perceived Quality Score, bringing customer perceptions more in line with Ford's improved vehicle quality. "Our results reflect Ford's balanced portfolio of products," said Mr. Czubay. "Our goal is to offer customers class-leading fuel efficiency, quality, safety, smart design and value in every product and category." In the third quarter of 2010, Ford plans to produce 570,000 vehicles, up 80,000 vehicles (16%) versus the third quarter 2009. The increase reflects higher consumer demand across Ford's entire family of cars, utilities and trucks. Ford's second quarter production plan is 640,000 vehicles, up 15,000 vehicles from the prior forecast. The sales data are based largely on data reported by dealers representing their sales to retail and fleet customers. * * * The Wall Street Journal's Neal E. Boudette reports that U.S. auto sales rose for the seventh month in a row in May on the strength of big gains by most car makers, including hard-hit Chrysler Group LLC, and renewed popularity for some large trucks and sport- utility vehicles. The Journal, citing Autodata Corp., reports sales of cars and light trucks jumped 19% in May, to 1.1 million vehicles. The Journal says the annualized sales pace for the month was 11.68 million vehicles -- up from the year-ago figure of 9.86 million and April's 11.2 million rate. The Journal further reports that General Motors Co., Ford Motor Co., Honda Motor Co. and Nissan Motor Co. all reported sales increases ranging from 17% to 24%. The Journal says Chrysler, which has been struggling to boost sales since its bankruptcy reorganization last year, outpaced them all, reporting a rise of 33%. Chrysler sold 104,819 vehicles in May, the first time in 14 months it surpassed the 100,000 mark. The Journal notes that sales of Toyota Motor Corp. -- which has been hobbled by its recalls -- grew just 6.7% to 162,813 vehicles after it pared back some sales incentives. About Ford Motor Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles across six continents. With about 176,000 employees and about 80 plants worldwide, the company's automotive brands include Ford, Lincoln, Mercury and, until its sale, Volvo. The company provides financial services through Ford Motor Credit Company. The Company's balance sheet at March 31, 2010, showed $191.9 billion in total assets and $197.4 billion total liabilities, for a stockholders' deficit of $5.4 billion. * * * According to the Troubled Company Reporter on May 21, 2010, Moody's Investors Service upgraded the ratings of Ford Motor Company and Ford Motor Credit Company. Ratings raised include Ford's Corporate Family Rating and Probability of Default Rating to B1 from B2, secured credit facility to Ba1 from Ba2, senior unsecured debt to B2 from B3, and trust preferred to B3 from Caa1. The Speculative Grade Liquidity rating remains at SGL-2. Also raised are Ford Credit's CFR and senior debt rating to Ba3 from B1. The rating outlook for Ford and Ford Credit is stable. On March 4, 2009, Ford deferred future interest payments on its 6.50% Junior Subordinated Convertible Debentures due January 15, 2032, beginning with the April 15, 2009 quarterly interest payment. On Nov. 3, 2009, S&P raised the corporate credit ratings on Ford Motor Co. and Ford Motor Credit Co. LLC to 'B-' from 'CCC+'. Ford Motor Co. carries a long-term issuer default rating of 'CCC', with a positive outlook, from Fitch Ratings. FOUR SEASONS HOTELS: A Dozen Units Are In Financial Distress ------------------------------------------------------------ According to a report by The Wall Street Journal's Kris Hudson, of the 82 hotels that fly Four Seasons flags, at least a dozen are in financial distress. The report notes that 2009 occupancy levels at the luxury chain's U.S. hotels averaged 57%, and revenue per available room fell 26%. Even with room rates that average $400 a night, many Four Seasons hotels can't generate enough cash to pay both interest and operating costs. The report also notes the Four Seasons hotels in Maui and Seattle are delinquent on their mortgages, and lenders have taken over one in Dallas. In Barbados, the report continues, a Four Seasons stalled in construction was rescued by a loan guarantee from the Barbadian government. The report also says the owner of Four Seasons hotels in San Francisco and Miami sold a two-thirds stake in the hotels in March 2010 to lighten the debt burdens, saving the San Francisco hotel from foreclosure. The report adds that Four Seasons in New York, the chain's flagship hotel, almost ran afoul of its lenders this year when it couldn't qualify to extend its mortgage because it wasn't generating enough cash flow. According to the report, the hotel's owner avoided default this spring by paying off some of the principal and putting up another property as collateral. Four Seasons Hotels & Resorts in 1986 began selling off its hotels, and now it no longer owns any of them and is purely a management company. The Wall Street Journal relates Four Seasons was taken private in 2006 in a $3.7 billion deal that gave Saudi Prince Alwaleed bin Talal a 45% stake and Microsoft Corp. founder Bill Gates's Cascade Investment LLC 45%. Isadore Sharp, Four Seasons' founder and chief executive, now 78 years old, kept 10% and stayed as CEO. According to the Journal, Four Seasons Hotels & Resorts has agreed to skimp on some of its signature features, bowing to pressures by some financially strapped owners of properties that bear its name. The Journal says Chris Jeffries was one of the owners who approached Mr. Sharp about cutting costs. Mr. Jeffries' Millennium Partners LLC owns the Four Seasons hotels in Miami and San Francisco, which was delinquent on its $90 million mortgage. He suggested dozens of cuts that, he said, wouldn't hurt service. FOUR SEASONS: Section 341(a) Meeting Scheduled for June 17 ---------------------------------------------------------- The U.S. Trustee for Region 21 will convene a meeting of Four Seasons 66B Investments, Corp's creditors on June 17, 2010, at 3:00 p.m. The meeting will be held at 51 SW First Ave Room 1021, Miami. 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. Coral Gables, Florida-based Four Seasons 66B Investments, Corp, filed for Chapter 11 bankruptcy protection on May 19, 2010 (Bankr. S.D. Fla. Case No. 10-23713). Cesar J. Dominguez, Esq., who has an office in Miami, Florida, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100,000,001 to $500,000,000. FREESCALE SEMICON: Names Daniel Heneghan to Board of Directors -------------------------------------------------------------- Freescale Semiconductor Inc. appointed Daniel J. Heneghan to fill a vacant seat on the Board of Directors of Freescale Holdings GP Ltd. Mr. Heneghan was also appointed to the Audit and Legal Committee of the Board. Mr. Heneghan will be reimbursed for expenses related to his service on the Board. Mr. Heneghan has no relationships or transactions with the Company. Freescale Semiconductor, Inc. -- http://www.freescale.com/-- once Motorola's Semiconductor Products Sector, is one of the oldest and most diverse makers of microchips in the world. It produces many different kinds of chips for use in automobiles, computers, industrial equipment, wireless communications and networking equipment, and other applications. The company's global client roster includes such blue-chip companies as Alcatel-Lucent, Bosch, Cisco Systems, Fujitsu, Hewlett-Packard, QUALCOMM, and Siemens, as well as former parent Motorola. Freescale nets about half of its sales from the Asia/Pacific region. The Blackstone Group, The Carlyle Group, Permira Advisers, and TPG Capital own the company. FRESH DEL: S&P Changes Outlook to Stable; Affirms 'BB' Rating ------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Cayman Islands-based Fresh Del Monte Produce Inc. to stable from positive. At the same time, Standard & Poor's affirmed its 'BB' corporate credit rating. As of April 2, 2010, Fresh Del Monte had about $309 million of debt outstanding. "The outlook revision reflects S&P's assessment that Fresh Del Monte will be unable to meet S&P's prior credit metric benchmarks for a higher rating due to difficult market conditions for bananas sold in Europe from oversupply and weak economic conditions, increased total debt adjustments due to operating leases, and renewed share buyback activity," said Standard & Poor's credit analyst Alison Sullivan. As a result, S&P believes Fresh Del Monte will maintain credit measures near current levels, including 2.5x lease- and pension-adjusted total debt to EBITDA and 37.5% funds from operations to total debt. The ratings on Fresh Del Monte Produce reflect its participation in the highly variable, commodity-oriented fresh fruit and vegetable industry. Uncontrollable factors such as global supply, world trade policies, political risk, currency swings, weather, and disease affect the industry. Fresh Del Monte benefits from its leading positions in the production, marketing, and distribution of fresh produce. Fresh Del Monte is the No. 1 marketer of fresh pineapples worldwide, and the No. 3 marketer of bananas worldwide. However, product concentration remains a rating concern, because of the high sales and earnings concentration from bananas and pineapples, respectively, and intense competition in those markets. Fresh produce operating results are also subject to seasonality, with gross profit skewed toward the first half of the calendar year, before local summer fruit enters the market in the northern hemisphere. The company sells fresh produce worldwide, but is limited by a royalty-free perpetual license to use the Del Monte trademark for processed and/or canned food, juices, snacks and desserts, in Europe, Africa, and the Middle East. S&P assumes Fresh Del Monte will maintain credit measures that are stronger than its rating category to compensate for inherent volatility in the produce industry. S&P could consider an upgrade if the company can sustain a rolling four-quarter average leverage of about 2x or less, and average FFO to total debt of about 40%. A potential upgrade would also require a prudent financial policy with respect to acquisitions and share repurchases. Although unlikely in the near term, S&P could consider a downgrade if average leverage exceeds 3x, which could occur with low single digit sales growth, a 200 basis point EBITDA margin decline and flat debt levels, relative to fiscal 2009. FUSION TELECOMMUNICATIONS: Posts $1.5 Million Net Loss in Q1 2010 ----------------------------------------------------------------- Fusion Telecommunications International, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $1.5 million on $9.6 million on revenue for the three months ended March 31, 2010, compared with a net loss of $3.0 million on $9.0 million of revenue for the same period ended March 31, 2009. Consolidated gross margin increased to 9.6% for the first quarter of 2010, compared to 5.9% for the first quarter of 2009. This margin increase resulted from stronger margins in the Carrier Services segment, where the gross margin increased from 5.2% to 8.3%, as well as the increased business volume in the Corporate Services segment, which achieved a gross margin of 40%. Selling, general and administrative costs decreased $273,968, or 11%, for the first quarter of 2010 compared to the first quarter of 2009. As a result of the increased revenues, improvement in gross margin, and reduced SG&A expenses, the Company's adjusted EBITDA loss (earnings before interest, taxes, depreciation, amortization, and specific non-recurring and non-cash adjustments) of $1.2 million for the first quarter of 2010 was a 38% improvement from its first quarter 2009 adjusted EBITDA loss of $1.9 million. Commenting on the results, Matthew Rosen, Chief Executive Officer of Fusion, said, "I am pleased that the first quarter of 2010 showed continued progress in achieving the milestones we have set for achieving profitability. Our gross margin, SG&A expenses, and adjusted EBITDA performance all showed marked improvement. We are delighted with these results, and we believe that strong sales growth, combined with continuing expense management, will position us well for continued improvements in our financial results." Expanding on Mr. Rosen's comments, Don Hutchins, President, Chief Operating Officer and Acting Chief Financial Officer, said, "We are particularly pleased with the nearly 150% revenue growth in our Corporate Services segment and the 68% gross margin improvement in our Carrier Services segment, when compared to the same period in 2009. In addition, our corporate revenue growth included twice as many add-on orders from existing customers as the prior quarter, demonstrating the loyalty of our customers and the attractiveness of our services." The Company's balance sheet as of March 31, 2010, showed $5.5 million in assets and $13.3 million of liabilities, for a stockholders' deficit of $7.8 million. As reported in the Troubled Company Reporter on March 29, 2010, Rothstein, Kass & Company, P.C., in Roseland, N.J., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has had negative working capital balances, incurred negative cash flows from operations and net losses since inception, and has limited capital to fund future operations. At March 31, 2010, the Company had a working capital deficit of roughly $9.8 million and an accumulated deficit of roughly $140.7 million. The Company has continued to sustain losses from operations. In addition, the Company has not generated positive cash flow from operations since inception. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63c2 A full-text copy of the press release is available for free at: http://researcharchives.com/t/s?63c3 Headdquartered in New York, Fusion Telecommunications International, Inc. Fusion (OTC BB:FSNN.OB - News) is a provider of IP-based digital voice and data communications services to carriers and corporations worldwide. GEMS TV: Court Considers Sale of Substantially All Assets Today --------------------------------------------------------------- The Hon. Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware will consider at a hearing today, June 3, 2010, at 4:30 p.m. (E.T.), the sale of substantially all of Gems TV (USA) Limited's non-inventory assets, free and clear of all claims and other liens and interests. The Debtor will sell the acquired assets in an auction, led by Zale Holding Company, Inc. The auction was scheduled for June 2, 2010, at Young Conaway Stargatt & Taylor, LLP, 1000 West Street, 17th Floor, Wilmington, Delaware. In the event of any competing bids for the assets, resulting in Zale Holding Company not being the successful buyer, it will receive a breakup fee of to be paid at the time of the closing of the sale with the third party buyer. Reno, Nevada-based Gems TV (USA) Limited, aka Gems TV, is a television retailer of gemstone jewelry products. Its parent is Gems TV Holdings Ltd., which owns and operates jewelry home shopping TV channels in the U.S., U.K. and Japan. The Company filed for Chapter 11 bankruptcy protection on April 5, 2010 (Bankr. D. Del. Case No. 10-11158). Robert S. Brady, Esq., and Robert F. Poppiti, Jr., Esq., at Young, Conaway, Stargatt & Taylor, assist the Company in its restructuring effort. Focus Management Group is the Company's financial advisor. Epiq Bankruptcy Solutions serves as claims and notice agent. The Company listed $10,000,000 to $50,000,000 in assets and $100,000,000 to $500,000,000 in liabilities. GENCORP INC: Files 2009 Annual Report for Savings Plan ------------------------------------------------------ GenCorp Inc. filed with the Securities and Exchange Commission an annual report on Form 11-K for the GenCorp Retirement Savings Plan. At December 31, 2009, the Plan had $320,964,817 in total assets and $321,677,596 in net assets available for benefits. A full-text copy of the Form 11-K report is available at no charge at http://ResearchArchives.com/t/s?63d3 About GenCorp Inc. Rancho Cordova, Calif.-based GenCorp Inc. (NYSE: GY) -- http://www.GenCorp.com/-- is a manufacturer of aerospace and defense products and systems with a real estate segment that includes activities related to the re-zoning, entitlement, sale, and leasing of the Company's excess real estate assets. The Company's balance sheet as of February 28, 2010, showed $1.019 billion in assets, $1.287 billion of debts, and $5.5 million of redeemable common stock, for a stockholders' deficit of $273.5 million. * * * On March 26, 2010, Moody's Investors Service upgraded both GenCorp Inc.'s Corporate Family Rating to B2 from B3 and Probability of Default ratings to B2 from Caa1. In addition, the senior secured credit facilities were upgraded to Ba2 from Ba3, as well as the convertible subordinated notes to Caa1 from Caa2. The 9-1/2% senior subordinated notes were confirmed at B1. On January, 22, 2010, Standard & Poor's Ratings Services raised its ratings of GenCorp Inc. to B- from CCC+ and removed all ratings from CreditWatch. GENERAL GROWTH: Equity Panel Taps Cantor Fitzgerald as Advisor -------------------------------------------------------------- The Official Committee of Equity Security Holders for General Growth Properties Inc. seeks the Court's permission to retain Cantor Fitzgerald & Co., as its financial advisor, nunc pro tunc to March 24, 2010. As the Equity Committee's financial advisor, Cantor Fitzgerald will: (a) to the extent Cantor Fitzgerald deems necessary, appropriate and feasible, or as the Equity Committee may request, review and analyze General Growth Properties, Inc.'s assets and its operating and financial strategies; (b) undertake, in consultation with the Equity Committee and its counsel, a financial analysis of GGP and any entities that may be created by GGP as part of a Plan; (c) evaluate GGP's debt capacity and assist in the determination of an appropriate capital structure for GGP; (d) evaluate indications of interest and proposals regarding any transaction relating to any restructuring, reorganization, rescheduling or recapitalization of GGP from current or potential lenders, equity investors, acquirors or strategic partners; (e) review, evaluate and advise on and, as deemed desirable by the Equity Committee, assist in negotiating a Restructuring Transaction, and, if directed, develop and evaluate alternative proposals for a Restructuring Transaction; (f) advise and assist the Equity Committee in identifying and evaluating additional potential capital sources, in connection with a Restructuring Transaction, not previously identified by any other party in the Debtors' bankruptcy cases; (g) be available at the Equity Committee's request to meet with the Equity Committee and its professionals, GGP management or board of directors, creditor groups, equity holders any official committees appointed in a bankruptcy case, or other parties to discuss the Restructuring Transaction; (h) if requested by the Equity Committee, participate in hearings before the Court and provide relevant testimony; and (i) at the Equity Committee's request, render an opinion to the Equity Committee as to the fairness, from a financial point of view, to GGP's stockholders, of the consideration to be received in the Restructuring Transaction. Subject to the Court's approval, Cantor Fitzgerald will be paid in accordance with this structure: (a) Cantor Fitzgerald will be entitled to receive from GGP a monthly cash fee of $150,000 during the term of the engagement; provided that each Monthly Fee payment will be credited against a "Restructuring Fee." (b) if a Restructuring Transaction is consummated and provided that the engagement has not been previously terminated for cause, Cantor Fitzgerald will be entitled to receive from GGP a cash fee for $2,050,000, less Monthly Fees previously paid. The Restructuring Fee will be paid in cash promptly upon any closing of a Restructuring Transaction, as long as the Restructuring Transaction closes within a year after the date of any termination of Cantor Fitzgerald. Cantor Fitzgerald will seek reimbursement of fees incurred. Steven L. Kantor, executive managing director and global head of investment banking at Cantor Fitzgerald, discloses that Saul Ewing, counsel to the Equity Committee, represents the firm in several litigation matters unrelated in the Debtors' Chapter 11 cases. He says Cantor Fitzgerald does not hold any interest adverse to the Debtors' estates. He maintains that Cantor Fitzgerald is a "disinterested person" as defined within Section 101(14) of the Bankruptcy Code. GENERAL GROWTH: Shares 2009 Financial Results to Stockholders ------------------------------------------------------------- General Growth Properties, Inc. (NYSE: GGP) made available its 2009 Annual Report to Stockholders, which contains GGP's 2009 consolidated financial statements and the CEO Letter to Shareholders, on the Investment section of its corporate Web site at http://www.ggp.com/ GGP's Annual Report on Form 10-K, previously filed with the Securities and Exchange Commission, is also available on the GGP Web site. Hard copies are available free of charge to GGP stockholders by submitting a request on the GGP Web site page "Financial Information by Mail," or by calling 866-818-9933. GGP Chief Executive Officer Adam Metz also sent a letter to GGP's shareholders dated May 24, 2010. Full-text copies of the 2009 Annual Report and Mr. Metz's May 24 Letter are available for free at: http://bankrupt.com/misc/ggp_AnnualReport2009.pdf http://bankrupt.com/misc/ggp_may24lettertoshareholders.pdf About General Growth Properties Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No. 09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: Wins Nod for More Appraisal Work for Cushman ------------------------------------------------------------ General Growth Properties Inc. and its units obtained approval from the Bankruptcy Court to employ Cushman & Wakefield, Inc., for appraisal, consulting, litigation and related services concerning their master planned community located in Summerlin, Nevada, which comprises about 7,400 acres of undeveloped land zoned for mixed residential and commercial use. Along with the original application and engagement letter, the Court previously approved an itemized list of appraisal services and associated appraisal fees known as the Property List Addendum. Per the Property List Addendum, the appraisal fees for the Summerlin MPC were originally scheduled for a flat fee of $65,000, with any consulting and litigation services to be paid separately on an hourly basis if necessary. In 2009, the Debtors determined that contingent, unliquidated claims filed by the heirs of the estate of Howard Hughes and their successors and assigns could make the appraised value of the Summerlin MPC a significant factor in the allocation of value under any chapter 11 plan, Adam P. Strochak, Esq,, at Weil, Gotshal & Manges LLP, in New York -- adam.strochak@weil.com -- tells the Court. In light of a possible dispute with the Hughes Heirs over the value of the Summerlin MPC, the Debtors believe that appraisal of the Summerlin MPC under the fixed fee arrangement set forth in the Engagement Letter likely would not be cost-effective for their estates because extensive litigation support services, charged on an hourly basis, would be necessary in addition to the fixed-fee appraisal. Thus, the Debtors agreed with C&W to utilize the services of C&W's Dispute Analysis & Litigation Support department for the entire Summerlin MPC valuation, to be charged at an hourly rate, and to delete the Summerlin MPC from the list of fixed-fee appraisals. The Debtors also seek that C&W's Amendment be made effective nunc pro tunc to January 1, 2010, to clarify that all C&W work on the Summerlin MPC appraisal, which is already well under way, will be charged on an hourly basis. Although the Debtors' believe that the Engagement Letter previously approved by the Court authorized the Debtors to utilize the C&W Litigation Team to conduct appraisal work and related support services in excess of the original estimate for the Summerlin MPC, the Debtors have filed the Supplemental Application out of an abundance of caution and in the interests of full disclosure. The Debtors will pay C&W's professionals according to their customary hourly rates: Name Rate per Hour ---- ------------- Marvin Wolverton, Richard Marchitelli $500 Raymond Murray $425 Cynthia Ganiere $385 Kaye Cuba $325 The Debtors will also reimburse C&W for expenses incurred. Although the Amendment states that C&W will bill travel time at its regular hourly rates, C&W has agreed to a request from the U.S. Trustee for Region 2 to bill nonworking travel time at half C&W's regular hourly rates. The Amendment does not cap expenses for hourly work on the Summerlin MPC, but C&W's billing for expenses will conform to the U.S. Trustee's guidelines. With respect to the Summerlin MPC, C&W will file interim and final fee applications for allowance of its compensation and expenses, with respect to its services. Richard Latella, executive managing director of C&W, discloses that Glenn Rufrano who recently had been named president and chief executive officer of the firm served on the board of General Growth Properties, Inc. Mr. Rufrano resigned from GGP's board on March 19, 2010, and has no ongoing employment, management or consulting relationship with GGP, Mr. Latella relates. Mr. Latella says Mr. Rufrano has not been involved in any of the work C&W has performed for GGP's property-level subsidiaries in connection with these Chapter 11 cases. Once he joins C&W, Mr. Rufrano will recuse himself from participation in any aspect of the work C&W performs for GGP and its subsidiaries pursuant to the firm's retention in these Chapter 11 cases and will be screened from information relating to the engagement, Mr. Latella notes. By imposing certain obligations and screen on individual appraisers to refrain from sharing information with Mr. Rufrano, these restrictions ensure that C&W will screen Mr. Rufrano effectively from all information relating to the engagement, Mr. Latella assures the Court. GENERAL MOTORS: Dumps Reva as Indian Electric Car Partner --------------------------------------------------------- GM India has ended its partnership with Reva Electric Car Company after Mahindra & Mahindra announced it was taking a controlling stake in Reva. M&M is one of India's largest auto makers. GM and Reva previously had an agreement to use Reva's technology to power the e-Spark, a small electric car that GM intends to develop in India. The two companies had initially planned to launch the e-Spark by the end of 2010, the Wall Street Journal's livemint.com, reported. The breakup had prompted GM to stand alone and to utilize its own alternative fuel and propulsion technologies, livemint.com related. "We plan to look within the General Motors portfolio for alternate technology vehicles," said Karl Slym, GM India's president and managing director. "There will be no eSpark," livemint.com quoted Mr. Slym as saying. He further said that the company is not yet firm whether it would deploy alternate technology on the Spark or the Beat models. According to livemint.com, GM's breakup with Reva will have no impact on GM India's short-term growth plans. An analyst at IHS Global Insight told livemint.com that GM's scrapping of its partnership with Reva will not affect GM India, saying that electric car sales in large quantities are still 10 or more years away, and GM can soon find alternatives to it. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At December 31, 2009, GM had total assets of US$136.295 billion against total liabilities of US$107.340 billion. At December 31, 2009, total equity was US$21.249 million. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Judge Orders Tort Claimants to Halt Suits --------------------------------------------------------- Bankruptcy Law360 reports that a bankruptcy judge has ordered plaintiffs to halt progress in six product liability suits against the reorganized General Motors LLC, saying the automaker's sale agreement generally bars the claims despite potential ambiguities. Judge Robert E. Gerber issued a ruling from the bench Tuesday in the U.S. Bankruptcy Court for the Southern District of New York, according to Law360. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At December 31, 2009, GM had total assets of US$136.295 billion against total liabilities of US$107.340 billion. At December 31, 2009, total equity was US$21.249 million. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: New GM Names Docherty VP for Int'l Operations ------------------------------------------------------------- General Motors announced that Susan E. Docherty has been appointed GM vice president, International Operations Sales, Marketing and Aftersales, effective June 1. Docherty, 47, will report to Tim Lee, president, GM International Operations. "Growth in China and other emerging markets is important to the company's future," said GM Chairman and CEO, Ed Whitacre. "We are counting on Susan to make a significant contribution and I am glad to have her running this critical part of our business." GM sells almost 50 percent of all new vehicles within GMIO, which is comprised of more than 90 markets including Asia Pacific, Latin America, Africa, the Middle East, Russia and the Commonwealth of Independent States. Most of the GMIO countries are considered emerging markets and are an engine of GMIO growth over the next decade. Docherty's role in the region will be to coordinate sales, marketing and aftersales in GM's Asia Pacific, Latin America, Africa, the Middle East, Russia and CIS operations. She will have responsibility for market performance, improving the opinion and consideration of Chevrolet, Buick, GMC, Holden and Cadillac brands to drive consumer demand for GM vehicles. "We are fortunate to have Susan joining us at this important time in GMIO's history, as we focus on growth throughout the region" said Lee. "She brings a wealth of sales and marketing experience with a fresh perspective to the way we approach our business." Docherty replaces Don Johnson, vice president, International Operational Sales, Marketing and Aftersales, 53, whose new position at GM will be announced soon. Most recently, Docherty was GM vice president of U.S. marketing. Previously she served as GM vice president, U.S. Sales, Service and Marketing, responsible for improving year-over-year sales performance, reducing incentive spend, improving residuals as well as marketing and advertising for the company's vehicle brands. She was also responsible for GM's relationship with dealers and numerous Dealer Councils. Docherty has extensive sales, service and marketing experience, having held positions with responsibility for Canada, the U.S., and abroad. Most notable is her brand work, including the launch of the 2010 Buick LaCrosse and GMC Terrain. "Susan has given her all to GM for many years," said GM president North America, Mark Reuss. "She has set the foundations for our future in North America and takes significant domestic and international experience and expertise to her new position. We wish her every success." About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At December 31, 2009, GM had total assets of US$136.295 billion against total liabilities of US$107.340 billion. At December 31, 2009, total equity was US$21.249 million. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: U.S. Treasury Selects Lazard as GM IPO Advisor -------------------------------------------------------------- The U.S. Department of the Treasury has tapped Lazard Freres & Co. as its adviser in preparation for an initial public stock offering by General Motors Co. Pursuant to an agreement, Lazard Freres, a New York-based investment bank, will analyze and review alternatives for the government's ownership stake. It will give advice on the use of "underwriters, brokers or other capital market advisers for the best means and structure to dispose of such assets," The Associated Press specified. The AP noted that Lazard Freres will be paid $500,000 a month over the next year for the advice it provides the government. If no stock sale has occurred during the first 12 months of the contract, the firm will receive a reduced fee of $250,000 a month until the sale is completed. In a related development, the U.S. Treasury and General GM may also pick a lead underwriter for the IPO, Bloomberg reported. The move will allow GM to file its IPO registration with the U.S. Securities and Exchange Commission in July and sell shares to the public by October or November 2010. GM and U.S. Treasury officials met in May 2010 with senior officials from Goldman Sachs Group Inc., Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Morgan Stanley -- who were asked about how much stock they would recommend selling, how much they thought GM might be worth, and what roadblocks might come up, the report noted. As acquirer of 61% of GM's shares through the $50 billion bailout in 2009, the U.S. Treasury "is likely to have more say in the selection than the carmaker itself," Bloomberg said, citing two anonymous sources familiar with the matter. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At December 31, 2009, GM had total assets of US$136.295 billion against total liabilities of US$107.340 billion. At December 31, 2009, total equity was US$21.249 million. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Chevrolet-Buick-GMC-Cadillac Sales Up 32% in May ---------------------------------------------------------------- General Motors Company said Wednesday that for the fifth straight month, Chevrolet, Buick, GMC and Cadillac together posted a double digit sales gain, with combined sales increasing 32% over last May. Year-to-date sales for GM's four brands have risen 31% to 874,749 units -- an increase of 206,994 units compared to last year, which is almost twice the volume lost from brands the company has discontinued. According to Steve Carlisle, vice president, U.S. Sales Operations, GM's brands have outperformed the market this year on the strength of the company's newest products. Year-to-date, combined sales of the Chevrolet Equinox, Chevrolet Camaro, Buick LaCrosse and Regal, GMC Terrain and Cadillac SRX and CTS Wagon are up 323%. "Each of our brands has new products that are being received well by customers. In fact, these new vehicles now account for about one in every four retail sales in the U.S.," said Mr. Carlisle. "With each brand launching new vehicles in the next few months, we are optimistic about the remainder of the year." Since 2005, crossover sales as a percentage of industry sales have almost doubled. During the same time, sales of GM's crossovers as a percentage of the company's sales have more than tripled. May sales of GM's crossovers -- Chevrolet Equinox, HHR and Traverse; Buick Enclave, GMC Terrain and Acadia; and Cadillac SRX -- were up 83% compared to May 2009, and are up 81% year-to-date. Through May, GM leads all automakers in total crossover sales. Chevrolet dealers reported sales of 167,235 -- 31% higher than May 2009. Retail sales for the brand were 19% higher for the month. Retail sales for Chevrolet's popular full-size pickups, Silverado and Avalanche, increased 14%, while retail sales for the Suburban rose 73%. The Chevrolet Silverado, Equinox, Traverse, Avalanche, Malibu and Camaro all posted year-over-year retail sales increases of 10% or more. Buick sales rose 37% for the month to 12,582 -- the eighth consecutive month of double digit year-over-year sales increases led by the LaCrosse and Enclave. Retail sales for Buick rose 46% during May. Buick LaCrosse retail sales increased 191% for the month. Year-to-date sales of the LaCrosse have increased 162%. GMC sales of 30,160 were 26% higher than last year, while retail sales for the brand were up 37%. Retail sales of the GMC Terrain continued to gain momentum, with sales increasing 350% for the year-to-date. Cadillac sales increased 54% to 12,328, while retail sales improved 43% for the month. CTS retail sales improved 7% for the month, and year-to-date sales of the SRX are 439% higher than a year ago. Month-end dealer inventory in the U.S. stood at about 408,000 units, which is about 22,000 lower compared to April 2010, and about 267,000 lower than May 2009. The Wall Street Journal's Neal E. Boudette reports that U.S. auto sales rose for the seventh month in a row in May on the strength of big gains by most car makers, including hard-hit Chrysler Group LLC, and renewed popularity for some large trucks and sport- utility vehicles. The Journal, citing Autodata Corp., reports sales of cars and light trucks jumped 19% in May, to 1.1 million vehicles. The Journal says the annualized sales pace for the month was 11.68 million vehicles -- up from the year-ago figure of 9.86 million and April's 11.2 million rate. The Journal further reports that General Motors Co., Ford Motor Co., Honda Motor Co. and Nissan Motor Co. all reported sales increases ranging from 17% to 24%. The Journal says Chrysler, which has been struggling to boost sales since its bankruptcy reorganization last year, outpaced them all, reporting a rise of 33%. Chrysler sold 104,819 vehicles in May, the first time in 14 months it surpassed the 100,000 mark. The Journal notes that sales of Toyota Motor Corp. -- which has been hobbled by its recalls -- grew just 6.7% to 162,813 vehicles after it pared back some sales incentives. Last month, GM reported first quarter 2010 results, marked by revenue of $31.5 billion and operating income of $1.2 billion. Net income attributable to common stockholders was $900 million, resulting in earnings per share on a diluted basis of $1.66. GM North America had EBIT in the first quarter 2010 of $1.2 billion, up from a loss of $3.4 billion in the fourth quarter 2009. GM Europe had a loss before interest and taxes of $500 million; an improvement of $0.3 billion from the fourth quarter. GM International Operations posted EBIT of $1.2 billion, up $500 million from the fourth quarter. Cash flow from operating activities was $1.7 billion and after adjusting for capital expenditures of $0.7 billion, free cash flow was $1.0 billion. GM ended the first quarter with $35.7 billion in cash and marketable securities, including funds in escrow. At March 31, 2010, GM had $136.021 billion in total assets, total liabilities of $105.970 billion and preferred stock of $6.998 billion, and non-controlling interests of $814 million, resulting in total equity of $23.053 billion. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 207,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GSI GROUP: Confirmed Plan Sweetened Recovery for Stockholders ------------------------------------------------------------- GSI Group Inc. on May 27 received confirmation of its Joint Chapter 11 Plan of Reorganization. Prior to confirmation, GSI modified the plan to allow shareholders to retain up to 87.3% of the stock if they participate to the maximum in an $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 original iteration of the plan where rejected by holders of 80% of the stock. GSI Group Inc. supplies precision technology to the global medical, electronics, and industrial markets and semiconductor systems. GSI Group Inc.'s common shares are quoted on Pink Sheets OTC Markets Inc. (GSIGQ). 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. GUNNALLEN FINANCIAL: Files for Chapter 11 Bankruptcy in Florida --------------------------------------------------------------- Tampa Bay Bankruptcy Center of Pennsylvania reports that GunnAllen Financial Inc. filed for bankruptcy under Chapter 11 in the U.S. Bankruptcy Court for the Middle District of Florida, listing both assets and debts of between $10 million and $50 million. In its Web site, the Company said it could not continue operations as a broker/dealer due to its current capital level and is now restricted to taking liquidating transactions only. The Company said it is working toward an orderly shut-down of the company and expects to cease operations. The Company owes $22.8 million to 5002 West Waters LLC of Miami and $75,000 worth of debts to Lewis Brisbois Bisgaard & Smith LLP of Tampa. GunnAllen Financial Inc. -- http://gunnallen.com-- is an investment and brokerage firm. JACKSON & PERKINS: Court Okays Appointment of Ch. 11 Trustee ------------------------------------------------------------ Jackson & Perkins Wholesale, Inc., and J & P Acquisitions, Inc., sought and obtained authorization from the U.S. Bankruptcy Court for the District of South Carolina to appoint a Chapter 11 trustee in the Debtors' bankruptcy cases. Because L. Stan Neely is already acting Chapter 11 trustee for the Park Seed Cases, the Debtors recommend that he be appointed as Chapter 11 trustee for the bankruptcy cases, in order to consolidate the management of the companies and maximize judicial and company resources. The Official Committee of Unsecured Creditors supports the appointment of a trustee. Hodges, South Carolina-based Jackson & Perkins Wholesale, Inc., filed for Chapter 11 bankruptcy protection on May 10, 2010 (Bankr. D. S.C. Case No. 10-03365). R. Geoffrey Levy, Esq., who has an office in Columbia, South Carolina, assists the Company in its restructuring effort. The Company listed $16,012,577 in assets and $31,181,971 in liabilities. JOHN MANEELY: Moody's Gives Stable Outlook, Retains 'B2' Rating --------------------------------------------------------------- Moody's Investors Service changed the rating outlook for John Maneely Company and 6582125 Canada Inc. to stable from negative. The company's corporate family remains at B2. The revised rating outlook recognizes the effective job JMC has done managing through the severe downturn of the last 18 months and its debt reduction over the last nine months. The B2 corporate family rating positively reflects JMC's highly variable cost structure, large scale and leading market position for many of its pipe products and electrical conduit, and adequate liquidity. However, the rating is constrained by Moody's expectation for challenging market conditions for JMC's largest market -- the non-residential construction market -- with that market still declining and a recovery possibly several years away. The company remains highly levered and has a relatively high reliance on commodity types of products that tend to have aggravated cycles, which impacts margins. Moody's previous rating action for JMC was on September 29, 2009, when the company's ratings were confirmed (B2 CFR) and a negative rating outlook was assigned, concluding a review for possible downgrade that began in June 2009. Headquartered in Beachwood, Ohio, John Maneely Company manufactures steel pipe, hollow structural steel, electrical conduit products and tubular products at ten manufacturing facilities in the U.S. and Canada. The company is number one or two in its key product areas: HSS, standard pipe and electrical conduit. JMC also enjoys leading market positions in the galvanized mechanical tube and fittings markets. Its products are sold principally to plumbing and electrical distributors. JMC's parent, DBO Holdings, Inc., is approximately 55% owned by the Carlyle Partners IV, LP. JONES SODA: Posts $2.1 Million Net Loss in Q1 2010 -------------------------------------------------- Jones Soda Co. filed its quarterly report on Form 10-Q, reporting a net loss of $2.1 million on $3.9 million of revenue for the three months ended March 31, 2010, compared with a net loss of $2.6 million on $7.1 million of revenue for the same period ended March 31, 2009. Michael O'Brien, Chief Financial Officer, said, "Over the last 12 months we have streamlined our business by lowering overhead costs and focusing our resources on our core glass bottle business. With this focus, we have achieved improved year-over-year bottom- line results on lower case volumes and lower revenues." "We believe in the strength of the Jones Soda brand, but our failure to actively promote and create retail marketing programs has slowed our same-store sales in several markets. We are realigning our resources to direct targeted funding for new marketing programs and to address gaps in our core product portfolio, as well as to secure and grow larger distributor and national retail accounts. We continue to explore strategic partnerships and financing options that would be beneficial to our Company and shareholders, and give us the necessary funding to create sustained growth with our brands. The beverage business is not complex, Jones overcomplicated its model and inadvertently limited its resources to compete effectively. Our plan going forward is to support our core brands at retail and compete in proven, high-growth segments with brand ideas that connect with consumers," commented William Meissner, President & Chief Executive Officer. As of March 31, 2010, the Company had cash and cash equivalents of approximately $2.4 million and working capital of $6.7 million. Cash used in operations during the quarter ended March 31, 2010, totaled $2.5 million. As of March 31, 2010, inventories were $3.8 million compared to $3.7 million as of December 31, 2009. The Company's balance sheet as of March 31, 2010, showed $11.2 million in assets, $3.0 million of liabilities, and $8.2 million of stockholders' equity. As reported in the Troubled Company Reporter on April 7, 2010, Deloitte & Touche LLP, in Seattle, 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 of the Company's recurring losses from operations, negative cash flows from operating activities, accumulated deficit, significant uncertainties in the Company's ability to meet their 2010 operating plan, and the need to obtain additional equity or debt financing, during 2010 or early 2011. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63d6 A full-text copy of the press release is available for free at: http://researcharchives.com/t/s?63d7 Headquartered in Seattle, Washington, Jones Soda Co. (NASDAQ: JSDA) -- http://www.jonessoda.com/-- markets and distributes premium beverages under the Jones Soda, Jones Pure Cane Soda(TM), Jones 24C(TM), Jones GABA(R), Whoopass Energy Drink(R) brands and sells through its distribution network in markets primarily across North America. JPMCC 2002: Court Extends Deadline for Schedules by 30 Days ----------------------------------------------------------- The Hon. Craig A. Gargotta at the U.S. Bankruptcy Court for the Western District of Texas extended, at the behest of JPMCC 2002- CIBC4 Highland Retail, LLC, the deadline for the filing of schedules of assets and liabilities and statement of financial affairs 30 days after the Petition Date. The Debtor said that while it is working diligently and expeditiously to prepare the schedules, its resources are limited. In view of the amount of work entailed in completing the schedules and the competing demands upon the Debtor's employees and professionals to assist in efforts to stabilize business operations during the initial post-petition period, the Debtor will not be able to properly and accurately complete the schedules within the required 14-day time period. Considering the usual press of business that accompanies the start of any Chapter 11 case, the Debtor anticipates that it won't be able to complete the schedules within the previous 14-day deadline. Miami Beach, Florida-based JPMCC 2002-CIBC4 Highland Retail, LLC, filed for Chapter 11 bankruptcy protection on May 12, 2010 (Bankr. W.D. Texas Case No. 10-11331). Charles R. Gibbs, Esq., at Akin, Gump, Strauss, Hauer, & Feld, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $500,001 to $1,000,000 in debts. JPMCC 2002: Taps Akin Gump as Bankruptcy Counsel ------------------------------------------------ JPMCC 2002-CIBC4 Highland Retail, LLC, has asked for authorization from the U.S. Bankruptcy Court for the Western District of Texas to employ Akin Gump Strauss Hauer & Feld LLP as bankruptcy counsel. Akin Gump will, among other things: a. take necessary action to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections to claims filed against the Debtor's estate; b. prepare motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtor's estate and appear on the Debtor's behalf at all hearings regarding the Debtor's case; c. negotiate, prepare and file a plan of reorganization and related disclosure statement(s) and all related documents, and otherwise promote the financial rehabilitation of the Debtor; and d. perform all other necessary legal services in connection with the prosecution of the Debtor's Chapter 11 case. Akin Gump will be paid based on the hourly rates of its personnel: Partners $485-$1,150 Special Counsel and Counsel $395-$835 Associates $325-$605 Paraprofessionals $125-$290 To the best of the Debtor's knowledge, Akin Gump is disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Miami Beach, Florida-based JPMCC 2002-CIBC4 Highland Retail, LLC, filed for Chapter 11 bankruptcy protection on May 12, 2010 (Bankr. W.D. Texas Case No. 10-11331). The Company listed $10,000,001 to $50,000,000 in assets and $500,001 to $1,000,000 in debts. KINETIC CONCEPTS: Moody's Affirms 'Ba2' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service affirmed the long-term ratings of Kinetic Concepts, Inc, including the Ba2 Corporate Family Rating and Ba2 Probability of Default Rating. Concurrently Moody's upgraded the rating on the senior secured credit facility to Baa3 from Ba1 in accordance with the application of Moody's Loss Given Default Methodology, given the considerable reduction in the size of the term loan due to debt repayment since 2008. The outlook remains stable. Despite challenges in the company's core Vacuum Assisted Closure, or V.A.C., wound healing franchise, including an increasingly competitive environment in the U.S. and abroad, KCI remains strongly positioned in the Ba2 rating category. The company has delevered substantially since the 2008 LifeCell acquisition and its free cash flow generation remains strong for the Ba2 rating category. However, the rating will likely remain constrained in the near-term by KCI's high product concentration, as 70% of revenues are generated by V.A.C. related products, and the pressures on that business that will constrain revenue growth. Moody's believe KCI will continue to pursue acquisitions in order to further diversity its business and reinvigorate growth. KCI has a substantial amount of flexibility to pursue acquisitions at the current rating level. Over time, if the company maintains a conservative leverage profile while diversifying its revenue through new product introductions, international expansion and acquisitions, there could be upward rating pressure. Ratings affirmed: * Corporate Family Rating, Ba2 * Probability of Default Rating, Ba2 Ratings upgraded: * $300 million Senior Secured Revolving Credit Facility due 2013, to Baa3, LGD2, 21% from Ba1 LGD2, 29% * $650 million Senior Secured Term Loan A due 2013, to Baa3, LGD2, 21% from Ba1 LGD2, 29% The ratings outlook is stable. The last rating action was April 18, 2008, when Moody's affirmed the Ba2 CFR in conjunction with the LifeCell acquisition. Kinetic Concepts, Inc., headquartered in San Antonio, Texas, is a global medical technology company with leadership positions in advanced wound care, regenerative medicine and therapeutic support systems (i.e., medical beds). The company's advanced wound care systems incorporate proprietary V.A.C. technology. KCI reported revenues of approximately $2.0 billion for the twelve months ended March 31, 2010. LEHMAN BROTHERS: LBI Engagement of Thomas Lee Terminated -------------------------------------------------------- Before the Petition Date, Lehman Brothers Inc. entered into an engagement letter with Thomas H. Lee Equity Fund VI, L.P., and THL Equity Advisors VI, LLC. The Fund and Advisor wish to terminate LBI's interests in the Agreement and take certain related actions. James W. Giddens, the trustee for LBI, has determined that it would be in the best interests of LBI and its estate that the Agreement be terminated by LBI subject to the payment to the LBI Trustee of $557,937 by the Fund. The LBI Trustee, the Fund and Advisor thus entered into a stipulation whereby the Fund agrees to pay in immediately available funds (i) $278,968 and $278,968 on April 28, 2010, to: Union Bank, N.A. ABA No. 122000496 A/C No. 37130196431 TRUSDG James W. Giddens, Trustee, LBI Funds Account Account No. 671186101 Upon receipt by the LBI Trustee of the Final Payment, the Agreement will be terminated without need for further action by any of the Parties, any further Bankruptcy Court approval and any further obligation or liability and pursuant to that termination. The LBI Trustee and the Fund and Advisor will be deemed to each have fully, finally and forever waived, settled, compromised, discharged and released each other from any and all Claims arising under the Agreement. Fund and Advisor also confirm that other than the Termination Fee, there are no fees, commissions, or other compensation owed to LBI pursuant to the Agreement. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: LBI Trustee Employs City-Yuwa as Special Counsel ----------------------------------------------------------------- James Giddens, trustee for Lehman Brothers Inc., received court approval to employ City-Yuwa Partners as his special counsel effective August 10, 2009. Mr. Giddens seeks the services of Tokyo-based City-Yuwa in connection with the settlement of debit and credit obligations between LBI and Lehman Brothers Japan Inc., the recovery of debts owed by LBJ, among other things. City-Yuwa will be paid for its services on an hourly basis and will be reimbursed for its expenses. The hourly rates and the firm's professionals who are tasked to provide the services are: Professionals Hourly Rates ------------- ------------ Masaaki Sawano JPY50,000 Kiyoshi Asada JPY33,000 Rei Funabashi JPY15,000 The rates may be subject to adjustment on January 1, 2011, according to Mr. Giddens, who also requests that fees and expenses incurred by the firm be paid as administrative expenses of LBI's estate. In a declaration, Mr. Sawano, Esq., at City-Yuwa, assures the Court that his firm does not have connection with or interest in LBI and that it does not have interest adverse to LBI's creditors and stockholders. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Lease Decision, Removal Periods Extended --------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York issued an order extending to September 9, 2010, the deadline for Lehman Brothers Inc.'s trustee to either assume or reject the company's executory contracts and unexpired leases. The Bankruptcy Court also gave Lehman Brothers Inc.'s trustee until December 8, 2010, to file notices of removal of civil cases involving LBI. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Reduces 85 Derivatives Claims by $58 Million ------------------------------------------------------------- Lehman Brothers Holdings Inc. is asking the Bankruptcy Court to ratify settlements were some $455 million in derivatives claims will be reduced to $397 million. A hearing on the negotiated reductions in 85 derivatives claims is scheduled for hearing on August 4. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Shareholders Want Official Equity Committee ------------------------------------------------------------ In separate letters, Koestler Tile Company, Carolyn J. Bessler, George E. Di Russo and Eric C. Giles ask the Court to direct the appointment of an official equity committee to represent and protect the rights of the equity owners of Lehman Brothers Inc. Rak Koestler, president of Koestler Tile, asserts that shareholders have suffered egregious losses. He says it is necessary to take any legal steps possible, as provided for by law to protect the right the shareholders' rights. Rogelio Beltran, Donald L. Boyd and Kelly L. McGehee also seek the Court's consideration regarding the shareholders' plight in the Debtors' Chapter 11 cases. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: SunCal Appeals Ruling Blocking Lawsuit ------------------------------------------------------- SunCal Cos. said it will appeal Bankruptcy Judge James Peck's ruling that bars it from suing Lehman Brothers Holdings Inc. in a dispute over more than two dozen stalled California real-estate projects, American Bankruptcy Institute reports. Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEVI STRAUSS: Names Mattel's CEO Robert Eckert as Director ---------------------------------------------------------- Levi Strauss & Co. elected Robert Eckert, chairman and chief executive officer of Mattel Inc., to its board of directors effective May 10, 2010. "[Mr. Eckert] is a highly experienced senior executive who understands the dynamics of building global consumer brands and creating cultures that are driven to win in the marketplace," said LS&Co. Chairman Richard Kauffman. "He is known for his high standard of integrity, his collaborative leadership style and his decisiveness in driving businesses to successful results. Mr. Eckert will bring great experience and valuable perspectives to the Levi Strauss & Co. board of directors." Mr. Eckert joined Mattel, Inc., as chairman and CEO in 2000. Since then, he has led the company through a major turnaround. Under his leadership, the company has substantially improved earnings and the stock price has doubled. Before joining Mattel, Eckert held numerous senior leadership positions at Kraft Foods, where he reinvented and grew several of the company's iconic food brands. He earned his B.S. in Business Administration at the University of Arizona and an MBA from the J.L. Kellogg Graduate School of Management at Northwestern University. "I am honored to join the Levi Strauss & Co. board of directors," said Eckert. "The Levi's brand is one of the world's great, iconic consumer brands and a clear industry leader. The company is pursuing a global strategic growth plan and is poised for an exciting period of renewal. I look forward to contributing my experience and perspectives on building brands globally as this multi-year plan unfolds." About Levi Strauss & Co. Headquartered in San Francisco, California, Levi Strauss & Co. -- http://www.levistrauss.com/-- is one of the world's leading branded apparel companies. The Company designs and markets jeans, casual and dress pants, tops, jackets and related accessories, for men, women and children under the Levi's(R), Dockers(R) and Signature by Levi Strauss & Co.(TM). The Company markets its products in three geographic regions: Americas, Europe, and Asia Pacific. As of February 28, 2010, the Company's balance sheet showed total assets of $2.9 billion and total liabilities of $3.1 billion, resulting in a stockholders' deficit of $265,455,000. * * * The Troubled Company Reporter reported on April 26, 2010, that Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating on San Francisco, Calif.-based Levi Strauss & Co. The outlook is stable. The TCR also reported that Moody's Investors Service assigned a B2 rating to Levi Strauss & Co proposed senior unsecured notes. All other ratings including its B1 Corporate Family Rating were affirmed. The rating outlook remains stable. The TCR reported on April 7, 2010, that Fitch Ratings affirmed Levi Strauss & Co.'s ratings: Issuer Default Rating at 'BB-'; $750 million Bank Credit Facility at 'BB+'; Senior unsecured notes at 'BB-'; Senior unsecured term loan 'BB-'. LOUIS SECORD: Case Summary & 8 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Louis A. Secord 8487 NE Woodland Cove Dr. Kirkland, WA 98034 Bankruptcy Case No.: 10-16245 Chapter 11 Petition Date: May 29, 2010 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Thomas T. Glover Debtor's Counsel: Gayle E. Bush, Esq. Bush Strout & Kornfeld 601 Union St Ste 5000 Seattle, WA 98101 Tel: (206) 292-2110 E-mail: gbush@bskd.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 8 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb10-16245.pdf The petition was signed by Louis A. Secord. MALIBU ASSOCIATES: Amends Plan Outline for Reorganization Plan -------------------------------------------------------------- Malibu Associates, LLC, filed with the U.S. Bankruptcy Court for the Central District of California amended Disclosure Statement explaining the proposed Plan of Reorganization. According to the Plan, the Debtor intends to pay allowed claims in full without interests. On the effective date, all interests will be deemed cancelled, terminated, extinguished. Equity interest holders will receive no distribution under the Plan. Administrative expenses, priority tax claims, the Class 1 secured claim of the L.A. County Tax Collector, the Class 2 claim (secured claim of the bank) but excluding the balloon payment under Option A, and Class 3 claims (general unsecured claims, excluding indemnification claims) will be paid from (i) cash on hand in the Debtor's equity account at bank of America as of the effective date; (ii) new cash to be contributed by the new members in an amount sufficient to pay (x) the allowed amount of the claims; and (y) the amounts budgeted to complete the entitlement process for the property, in exchange for a 100% ownership interest in the Reorganized Debtor. As reported in the Troubled Company Reporter on April 30, 2010, the new members will be: T&J Investment Partners, LLC HIX Rubenstein Companies MPK Development, LLC The Leone-Pekins Trust Crankstart Foundation Third Millenium Trust RSF, JR., LLC Dr. David Agus A full-text copy of the amended Disclosure Statement is available for free at: http://bankrupt.com/misc/malibuassociates_amendedDS.pdf About Malibu Associates, LLC Malibu, California-based Malibu Associates, LLC, dba Malibu Country Club and Malibu Country Club filed for Chapter 11 on November 3, 2009 (Bankr. C.D. Calif. Case No. No. 09-24625). Ashleigh A. Danker, Esq., at Kaye Scholer LLP represents the Debtor in its restructuring effort. According to the schedules, the Company has assets of $42,853,592, and total debts of $35,758,538 as of the petition date. MARY GONSALVES: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Mary Regina Gonsalves 829 N. Orange Grove Avenue Los Angeles, CA 90046 Bankruptcy Case No.: 10-32036 Chapter 11 Petition Date: May 29, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Vincent P. Zurzolo Debtor's Counsel: Denise M. Fitzpatrick, Esq. Law Offices of Denise M Fitzpatrick 468 N Camden Drive, 3rd Floor Beverly Hills, CA 90210 Tel: (310) 860-5693 Fax: (310) 997-3506 E-mail: df@benchmarklegal.net Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's list of 9 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-32036.pdf The petition was signed by the Debtor. MARY TAPLETT: U.S. Trustee Objects to Hiring of Bankr. Counsel -------------------------------------------------------------- The U.S. Trustee has filed with the U.S. Bankruptcy Court for the Eastern District of Washington an objection to Mary L. Taplett's hiring of Christina M. Davitt of Davitt Law Group, PLLC, as bankruptcy counsel. According to the Trustee, the Debtor's request for court authorization to hire Ms. Davitt doesn't provide any of the subsections' detailed required disclosures. "These details should be provided by supplement or amendment," the Trustee states. The Trustee says that the disclosures do not affirmatively show disinterestedness. East Wenatchee, Washington-based Mary L. Taplett filed for Chapter 11 bankruptcy protection on May 10, 2010 (Bankr. E.D. Wash. Case No. 10-02835). The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. Two affiliates -- Taplett Family Ltd. Partnership and Taplett Orchard, Inc. -- filed for Chapter 11 in 2009. MEDIACOM COMMUNICATIONS: Fitch Puts 'B+' Rating on Negative Watch ----------------------------------------------------------------- Fitch Ratings has placed the 'B+' Issuer Default Rating for Mediacom Communications Corporation and its wholly owned subsidiaries Mediacom LLC and Mediacom Broadband LLC on Rating Watch Negative. Additionally, specific issue ratings assigned to the company's senior secured and senior unsecured debt, as listed at the end of this release, have also been placed on Rating Watch Negative. Approximately $3.4 billion of debt outstanding as of March 31, 2010, is affected by Fitch's actions. Fitch's ratings action follows MCCC's announcement that its board of directors has received a proposal from the company's chairman and CEO Rocco B. Commisso to acquire all of MCCC's outstanding class A and class B common stock not already beneficially owned by Commisso for $6.00 per share in cash. If accepted the proposed transaction would be valued at approximately $247 million. From Fitch's view the proposed transaction will weaken MCCC's credit profile and stress the company's ability to generate free cash flow relative to Fitch's expectations. Assuming the transaction as currently contemplated is completely debt financed, leverage for the last 12 month period ending March 31, 2010 would increase to 6.7 times, which is outside of Fitch's expectations given the current rating category. A key consideration during Fitch's review of the proposed transaction will include the extent to which MCCC utilizes expected free cash flow generation to reduce leverage to levels more reflective of the current rating category. Prior to the company's announcement, Fitch expected that MCCC's leverage would approximate 6.0x by year-end 2010 (from 6.2x as of March 31, 2010 adjusted for the new credit facilities) and improve to 5.7x by the end of 2011 while continuing to generate positive free cash flow during this timeframe. The transaction would be financed through borrowings under MCCC's existing subsidiary credit facilities. After giving effect to the new credit facilities put in place by subsidiaries of MCCC in May, MCCC has an aggregate of $734.5 million of revolving credit commitments with no outstanding balance. The company's available borrowing capacity, net of $19.5 million of letters of credit totals approximately $715 million. The available borrowing capacity together with approximately $132 million of cash (pro forma as of March 31, 2010 after considering the new credit facilities) provides MCCC with sufficient liquidity to fund the transaction as currently contemplated and address the company's ongoing liquidity requirements. Fitch has placed these ratings on Rating Watch Negative: Mediacom Communications Corporation -- IDR 'B+'. Mediacom Broadband LLC -- IDR 'B+'; -- Senior unsecured 'B/RR5'. Mediacom LLC -- IDR 'B+'; -- Senior unsecured 'B/RR5'. Mediacom Illinois LLC Mediacom Arizona LLC Mediacom Indiana LLC Mediacom California LLC Mediacom Minnesota LLC Mediacom Delaware LLC Mediacom Wisconsin LLC Mediacom Southeast LLC Mediacom Iowa LLC Zylstra Communications Corporation -- IDR 'B+'; -- Senior secured 'BB+/RR1'. MCC Georgia, LLC MCC Illinois, LLC MCC Iowa, LLC MCC Missouri, LLC -- IDR 'B+'; -- Senior secured 'BB+/RR1'. MEDIACOM COMMUNICATIONS: Privatization Could Affect Moody's Rating ------------------------------------------------------------------ Moody's Investors Service said Mediacom Communications Corporation's ratings could come under pressure if the proposed transaction to go private as announced comes to fruition. The last rating action for Mediacom was on April 15, 2010, when Moody's assigned Ba3 ratings for new bank credit facilities of subsidiaries Mediacom LLC and Mediacom Broadband, LLC. Mediacom Communications Corporation, through its operating subsidiaries, is a domestic cable multiple system operator serving approximately 1.2 million basic video subscribers in a wide variety of small- to mid-sized markets. Mediacom generated $1.47 billion in revenue over the twelve month period ended 3/31/10. The company maintains its headquarters in Middletown, New York. MEDIACOM COMMUNICATIONS: S&P Gives Neg. Outlook; Keeps 'B+' Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services said it revised its ratings outlook on Middletown, N.Y.-based Mediacom Communications Corp. to negative from stable. S&P also revised the outlook on Mediacom's subsidiaries, Mediacom Broadband Group and Mediacom Broadband LLC, to negative from stable. At the same time, S&P affirmed its ratings on the company, including the 'B+' corporate credit rating. The outlook revision is based on the $6 take private offer by Mediacom Chairman, CEO, and founder Rocco Commisso and the resulting increase in leverage to, S&P estimates, 6.8x from 6.3x as of March 31, 2010. This leverage leaves little room for Mr. Commisso to increase his offer within the current rating level. The $6 offer price represents a 12.5% premium to Friday's closing stock price of $5.33. "The ratings on Mediacom reflect an aggressive financial profile, a mature core basic video services business with modest revenue growth prospects, and below-industry-average high-speed data and telephony penetration," said Standard & Poor's credit analyst Naveen Sarma. Other factors include competitive pressures on both the video customer base from direct-to-home satellite TV providers and HSD customers from telephone companies. Partly tempering these factors are the company's position as the still-dominant provider of pay-TV services in its markets, expectations for limited video competition from the local telephone operators, and solid liquidity due to availability of substantial bank financing. Mediacom, which services about 1.2 million basic video subscribers, had $3.4 billion of debt as of March 31, 2010. METRO-GOLDWIN-MAYER: The Hobbit Director Quits Amid Delay --------------------------------------------------------- dailymail.co.uk reports that director Guillermo Del Toro has quit the Hobbit films amid speculation about the future of film studio Metro-Goldwin-Mayer, which is yet to approve for production to commence. The Hobbit is a two-part prequel to the Lord Of The Rings trilogy. Brooks Barnes at The New York Times' Media Decoder reported last month that MGM's lenders agreed to let the studio skip interest and principal payments until July 14, 2010. MGM tried to sell itself in March but received low bids. According to The Wall Street Journal, early in March MGM was readying a backup plan should bids for its assets come in too low. Sources told the Journal MGM creditors are increasingly willing to assume control over the studio. The sources said that under that scenario, MGM would likely pursue a "standalone" plan in which lenders would convert their debt to equity. MGM has hired investment bank Moelis & Company and the law firm Skadden, Arps, Slate, Meagher & Flom. In August 2009, it hired the restructuring expert Stephen F. Cooper to help lead the company. About Metro-Goldwyn-Mayer Metro-Goldwyn-Mayer, Inc., is an independent, privately held motion picture, television, home video, and theatrical production and Distribution Company. The Company owns the world's largest library of modern films, comprising approximately 4,000 titles, and over 10,400 episodes of television programming. An investor consortium, comprised of Providence Equity Partners, TPG Capital, Sony Corporation of America, Comcast Corporation, DLJ Merchant Banking Partners and Quadrangle Group, owns MGM. MICHAELS STORES: Reports $13 Million Net Income for May 1 Qtr ------------------------------------------------------------- Michaels Stores, Inc., reported net income of $13 million for the first quarter of fiscal 2010, a $9 million improvement from net income of $4 million in the first quarter of fiscal 2009. Total sales for the quarter ended May 1, 2010, were $901 million, a 5.7% increase from fiscal 2009 first quarter sales of $852 million. Same-store sales for the comparable 13-week period increased 4.9% of which 160 basis points were related to the positive impact of foreign exchange rates. First quarter operating income increased $41 million to $105 million from $64 million in fiscal 2009. John Menzer, Chief Executive Officer, said, "We were pleased with the strengthening sales trends and the improvement of our operations during the first quarter. A number of key categories performed well during the first quarter, including Custom Framing, Bakeware and Jewelry. Michaels continues to make significant improvements in the customer shopping experience, particularly with expanded classroom programs and in-store events. These programs create excitement and drive increased store traffic. Strong product offerings, increased classroom participation and a strengthening retail environment all contributed to the increase in our comparable store sales performance." At May 1, 2010, the Company had total assets of $1.563 billion against total liabilities of $4.319 billion, resulting in stockholders' deficit of $2.756 billion. Quarter end debt levels totaled $3.695 billion, down approximately $262 million from the prior year. During the quarter, the Company made a $118 million excess cash flow payment on its Senior Secured Term Loan. At the end of the first quarter fiscal 2010, the Company had $79 million in cash and approximately $651 million of availability under its revolving credit facility. As of May 26, 2010, availability under the credit facility was approximately $629 million. A full-text copy of the Company's Form 10-Q report is available at no charge at http://ResearchArchives.com/t/s?63d4 A full-text copy of the Company's earnings release is available at no charge at http://ResearchArchives.com/t/s?63d5 Irving, Texas-based Michaels Stores, Inc. is North America's largest specialty retailer of arts, crafts, framing, floral, wall d�cor and seasonal merchandise for the hobbyist and do-it-yourself home decorator. As of May 26, 2010, the Company owns and operates 1,029 Michaels stores in 49 states and Canada, and 146 Aaron Brothers stores. MOMENTIVE PERFORMANCE: Promotes William Torrence to CFO ------------------------------------------------------- Douglas A. Johns, general counsel and secretary of Momentive Performance Materials Inc., said William Torrence has been promoted to chief financial officer of the Company's Quartz business. Mr. Torrence resigned as the Company's principal accounting officer. The Company appointed Billie Jo Cuthbert to replace Mr. Torrence's place effective May 10, 2010. Mrs. Cuthbert served as Controller of the Company's Silicones Americas business since the acquisition of GE Advanced Materials by the Company and its affiliates on December 4, 2006. Prior to the acquisition, Mrs. Cuthbert served as Controller of GE Advanced Materials' Silicones Americas business from May, 2006, and as Controller, Corporate Healthcare & Medical Programs, at General Electric Company from 1997 to 2006. About Momentive Performance Momentive Performance Materials, Inc., is a producer of silicones and silicone derivatives, and is engaged in the development and manufacture of products derived from quartz and specialty ceramics. As of Dec. 31, 2008, the Company had 25 production sites located worldwide, which allows it to produce the majority of its products locally in the Americas, Europe and Asia. Momentive's customers include companies in industries, such as Procter & Gamble, 3M, Goodyear, Unilever, Saint Gobain, Motorola, L'Oreal, BASF, The Home Depot and Lowe's. As of June 28, 2009, Momentive had $3.41 billion in total assets on $3.96 billion in total liabilities, resulting in $551.8 billion in stockholders' deficit. The Troubled Company Reporter said September 28, 2009, that Standard & Poor's Ratings Services placed all its ratings on Momentive Performance Materials and its subsidiaries on CreditWatch with positive implications, including the 'CCC-' corporate credit rating on Momentive Performance Materials. S&P believes it is likely that the waiver, together with improving operating performance, significantly reduces the likelihood of a near-term covenant breach. Quarterly EBITDA has been climbing steadily since reaching a low of about $15 million (as calculated for bank covenant purposes) in the first quarter of 2009. It was $64 million in the second quarter, and management expects it to be between $84 million and $94 million in the third quarter. According to the Troubled Company Reporter on May 21, 2010, Moody's Investors Service changed the rating outlook for Momentive Performance Materials Inc. to stable from negative reflecting the substantial improvement in performance in the first quarter of 2010 and the expectation that profits will remain elevated. Moody's also affirmed the company's other ratings (Corporate Family Rating at Caa1) and updated the LGD point estimate for the senior unsecured notes. MOUNT VERNON: Put by Receiver in Chapter 11 ------------------------------------------- Mount Vernon Monetary Management Corp. was put into Chapter 11 on May 27 by its federal court-appointed receiver (Bankr. S.D.N.Y. Case No. 10-23053). Mount Vernon is a provider of automated teller machines. According to Bloomberg News, the receiver Allen D. Applbaum said in a court filing said the Company had book assets of $179 million and liabilities of $186 million on April. The Chapter 11 petition, however, estimated that assets and debts as of the bankruptcy filing only range $1,000,001 to $10,000,000. Bloomberg relates that Mount Vernon President Robert Egan and Chief Operating Officer Bernard McGarry were arrested and indicted in early 2008 on charges of bank fraud and conspiracy to commit bank fraud. Mr. Applbaum was appointed receiver on April 12, 2008, four days after the arrest. The receiver intends on using Chapter 11 to sell the businesses and assets. Liabilities include $60 million owing to customers that should have been covered by cash deposits but weren't. At the time of the arrests, the Federal Bureau of Investigation seized $19 million in currency. The authorities told the receiver that they intend to continue holding the cash and distribute the money through a criminal forfeiture proceeding in the U.S. district court. Allen G. Kadish, Esq., at Greenberg Traurig, LLP, represents the Debtor in its Chapter 11 effort. MOVIE GALLERY: Plan Exclusivity Extended to July 31 --------------------------------------------------- Movie Gallery Inc. won a July 31 extension of the exclusive period to propose a Chapter 11 plan and a September 30 extension of the exclusive period to solicit acceptances of the plan. Thus while Movie Gallery is in the process of closing its last 1,028 movie- rental stores, the Company it won't be facing competing Chapter 11 plans. Great American Group Inc. won the auction on the right to close the last stores with a guarantee of $74.2 million. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc., is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Movie Gallery Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Movie Gallery Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). NATIONAL ENERGY: Settles Derivative Suit over Asset Sale for $9MM ----------------------------------------------------------------- Bankruptcy Law360 reports that National Energy Group Inc. has agreed to fork out $9.15 million to settle a shareholder derivative action over the company's November 2006 sale of its noncontrolling 50 percent membership interest in NEG Holding LLC, paving the way for NEGI to proceed with its planned liquidation. NEGI announced Friday that it had struck a deal to resolve the suit pending against it in the Delaware Chancery Court, Law360 says. About National Energy Bethesda, MD-based PG&E National Energy Group Inc. nka National Energy & Gas Transmission Inc. -- http://www.pge.com/-- develops, builds, owns and operates electric generating and natural gas pipeline facilities and provides energy trading, marketing and risk-management services. The Company and six of its affiliates filed for Chapter 11 protection on July 8, 2003 (Bankr. D. Md. Case No. 03-30459). When the Company filed for protection from its creditors, it listed $7,613,000,000 in assets and $9,062,000,000 in debts. NEGT received bankruptcy court approval of its reorganization plan in May 2004, and emerged from bankruptcy on Oct. 29, 2004. NEGT's affiliates -- NEGT Energy Trading Holdings Corp., NEGT Energy Trading - Gas Corporation, NEGT ET Investments Corp., NEGT Energy Trading - Power, L.P., Energy Services Ventures, Inc., and Quantum Ventures -- filed their First Amended Plan and Disclosure Statement on March 3, 2005, which was confirmed on Apr. 19, 2005. Steven Wilamowsky, Esq., and Jessica S. Etra, Esq., at Willkie Farr & Gallagher LLP represent the ET Debtors. On Nov. 6, 2006, Judge Mannes entered a final decree closing Quantum Ventures' Chapter 11 case with its estate having been fully administered. NEFF CORP: Gets Court OK to Hire Kurtzman Carson as Claims Agent ---------------------------------------------------------------- Neff Corp., et al., sought and obtained permission from the Hon. Shelley C. Chapman of the U.S. Bankruptcy Court for the Southern District of New York to employ Kurtzman Carson Consultants LLC as notice and claims agent. KCC will, among other things: (a) notify potential creditors of the filing of the Bankruptcy petitions and of the setting of the first meeting of creditors, pursuant to section 341(a) of the U.S. Bankruptcy Code, under the proper provisions of the Bankruptcy Code and the Bankruptcy Rules as determined by Debtors' counsel; (b) prepare and serve required notices in the Chapter 11 Cases; (c) maintain an official copy of the Debtors' schedules of assets and liabilities and statement of financial affairs, listing the Debtors' known creditors and the amounts owed thereto; and (d) provide access to the public for examination of copies of the proofs of claim or proofs of interest filed in the Chapter 11 cases without charge during regular business hours (if necessary). KCC will be compensated based on its services agreement with the Debtors. A copy of the agreement is available for free at: http://bankrupt.com/misc/NEFF_CORP_kccservicespact.pdf Albert H. Kass, the Vice President of Corporate Restructuring Services of KCC, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. 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. NEFF CORP: U.S. Trustee Appoints Five Members to Creditors Panel ---------------------------------------------------------------- Diana G. Adams, the U.S. Trustee for Region 2, appoints five members to the Official Committee of Unsecured Creditors in Neff Corp., LLC., et al.'s Chapter 11 cases. The Committee members include: 1. Footprints Asset Management c/o Steve Lococo 11422 Miracle Hills Drive, Suite 208 Omaha, NE 68154 Phone: (402) 445-9333 Fax: (402) 445-0526 2. Shirley L. Wong 77 West Washington Street Suite 505 Chicago, Illinois 60602 Phone: (312) 977-1020 3. Richard D. Almandi 5750 NE Island Cove Way #3405 Stuart, FL 34996-4302 Phone: (414) 322-5429 4. Allen Daniel Barnett 4631 Lake Norrell Rd. Alexander, AR 72002 Phone: (501) 227-3225 5. Law Debenture Trust Company of New York Attn: Michael A. Smith, Vice President 400 Madison Avenue, Suite 4D New York, NY 10017 Phone: (212) 750-6474 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. NEOMEDIA TECHNOLOGIES: Earns $57.3 Million in Q1 2010 ----------------------------------------------------- NeoMedia Technologies, Inc., filed its quarterly report on Form 10-Q, reporting net income of $57.3 million on $355,000 of revenue for the three months ended March 31, 2010, compared with a net loss of $106.6 million on $490,000 of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $8.9 million in assets, $67.7 million of liabilities, and $11.1 million of convertible preferred stock, for a stockholders' deficit of $69.9 million. As reported in the Troubled Company Reporter on April 1, 2010, Kingery & Crous, 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 suffered recurring losses from operations and has ongoing requirements for additional capital investment. Net cash used by operations for the three months ended March 31, 2010, was $1.8 million. At March 31, 2010, the Company has an accumulated deficit of $222.2 million and a working capital deficit of $67.0 million. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63bb Atlanta, Ga.-based NeoMedia Technologies, Inc., provides mobile barcode scanning solutions. The Company's technology allows mobile devices with cameras to read 1D and 2D barcodes and provide "one click" access to mobile content. NEW YORK CHOCOLATE: Plant Set for Auction on June 30 ---------------------------------------------------- Bill Rochelle at Bloomberg News reports that New York Chocolate & Confections Co. which owns what had been the first chocolate factory in the U.S. owned by Nestle USA Inc., is set to auction its assets on June 30. According to the report, the minimum bid for all the assets at auction is $465,000, the debt owing on a secured loan owing to Fulton County. The county is entitled to bid its secured claim rather than cash at the auction. Bids are initially due June 28. The hearing for approval of the sale will take place June 30 in U.S. Bankruptcy Court in Syracuse, New York. The Company, which owns a 39-acre plant in Fulton, New York, hasn't produced chocolate in four years. It is owned by a quasi- governmental agency of the West African nation of the Ivory Coast. The country is the world's leading producer of cocoa beans. About New York Chocolate The New York Chocolate and Confections Co. operates in the former Nestle chocolate plant in Fulton. New York Chocolate filed for Chapter 11 on April 14, 2010 (Bankr. N.D. N.Y. Case No. 10-30963). Geoffrey Raicht, Esq., at McDermott Will & Emery, LLP, represents the Debtor in its Chapter 11 effort. The petition said that assets total $1,000,001 to $10,000,000 while debts range from $500,001 to $1,000,000. NEXSTAR BROADCASTING: Posts $1.6 Mil. Net Loss for March 31 Qtr --------------------------------------------------------------- Nexstar Broadcasting Group Inc. filed its quarterly report Form 10-Q, showing $1.6 million net loss on $68.6 million net revenue for the three months ended March 31, 2010, compared with $1.3 million net loss on $55.4 million net revenue for the same period a year earlier. The company's balance sheet showed $603.0 million total assets and $782.6 million total liabilities, for a $179.6 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?6229 About Nexstar Broadcasting Group Irving, Texas-based Nexstar Broadcasting Group Inc. currently owns, operates, programs or provides sales and other services to 62 television stations in 34 markets in the states of Illinois, Indiana, Maryland, Missouri, Montana, Texas, Pennsylvania, Louisiana, Arkansas, Alabama, New York, Rhode Island, Utah and Florida. N exstar's television station group includes affiliates of NBC, CBS, ABC, FOX, MyNetworkTV and The CW and reaches approximately 13 million viewers or approximately 11.5% of all U.S. television households. At March 31, 2010, the Company had total assets of $603,022,000 against total liabilities of $782,673,000, resulting in stockholders' deficit of $179,651,000. * * * According to the Troubled Company Reporter on April 8, 2010, Standard & Poor's Ratings Services affirmed its ratings on Nexstar Broadcasting Group Inc., including the 'B-' corporate credit rating. The rating outlook is positive. NEXTMEDIA GROUP: Can Sell Radio Station and Related Properties -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized NextMedia Group, Inc., et al., to sell their radio station and related real and personal property free and clear of liens, claims and encumbrances. Greenwood Village, Colorado-based NextMedia Group, Inc., provides out-of-home media services through radio broadcasting and outdoor advertising. The Debtors operate an aggregate of 36 AM and FM radio stations in a total of seven rated and unrated small, mid- size and suburban markets, including the Greenville-New Bern- Jacksonville, North Carolina area; the Saginaw-Bay City-Midland, Michigan area; Canton, Ohio; Myrtle Beach, South Carolina; San Jose, California; suburban Chicago; and suburban Dallas. NextMedia Group filed for Chapter 11 bankruptcy protection on December 21, 2009 (Bankr. D. Delaware Case No. 09-14463). The Debtor's affiliates, NextMedia Investors LLC, et al., also filed Chapter 11 bankruptcy petitions. Paul N. Heath, Esq.; Michael J. Merchant, Esq.; and Chun I. Jang, Esq., at Richards Layton & Finger, assist the Debtors in their restructuring efforts. NextMedia Group listed $50,000,001 to $100,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. NEXTMEDIA GROUP: Emerges from Chapter 11 Bankruptcy Protection -------------------------------------------------------------- NextMedia Group said it has emerged from Chapter 11 reorganization with $135 million in new debt financing and a new $55 million equity investment from new investors. The Company said it is the process of satisfying all financial obligations to vendors and landlords in full, according to mediabuyerplanner.com The Court-confirmed plan contemplates a restructuring and reorganization of the Debtors. The principal terms of the Plan are: i) holders of the first lien debt and holders of the general unsecured claims will be paid in full; ii) holders of the second lien debt will receive 95% of the common equity in Reorganized NM Group, subject to dilution; iii) second lien investors will receive 66.67% of the common equity in Reorganized NM Group in exchange for a $55 million equity investment, subject to dilution; iv) holders of equity interest in NM investors will receive 5% of the common equity in Reorganized NM Group, subject to dilution; v) NM investors will be dissolved and cease to exist as a legal entity. The restructuring will be financed through the equity investment, new debt financing of $127.5 million, cash on hand and any other additional financing that may be necessary. A full-text copy of the amended Disclosure Statement is available for free at http://bankrupt.com/misc/NextMedia_AmendedDS.pdf Greenwood Village, Colorado-based NextMedia Group, Inc., provides out-of-home media services through radio broadcasting and outdoor advertising. The Debtors operate an aggregate of 36 AM and FM radio stations in a total of seven rated and unrated small, mid- size and suburban markets, including the Greenville-New Bern- Jacksonville, North Carolina area; the Saginaw-Bay City-Midland, Michigan area; Canton, Ohio; Myrtle Beach, South Carolina; San Jose, California; suburban Chicago; and suburban Dallas. NextMedia Group filed for Chapter 11 bankruptcy protection on December 21, 2009 (Bankr. D. Delaware Case No. 09-14463). The Debtor's affiliates, NextMedia Investors LLC, et al., also filed Chapter 11 bankruptcy petitions. Paul N. Heath, Esq.; Michael J. Merchant, Esq.; and Chun I. Jang, Esq., at Richards Layton & Finger, assist the Debtors in their restructuring efforts. NextMedia Group listed $50,000,001 to $100,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. NORTH LAND INVESTMENTS: Sec. 341(a) Meeting Scheduled for June 17 ----------------------------------------------------------------- The U.S. Trustee for Region 13 will convene a meeting of Four Seasons 66B Investments, Corp's creditors on June 17, 2010, at 10:00 a.m. The meeting will be held at the US Courthouse, Room 2110A, 400 E. 9th Street, Kansas City, MO. 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. Blue Springs, Missouri-based Northland Investments Co., Inc., filed for Chapter 11 bankruptcy protection on May 19, 2010 (Bankr. W.D. Mo. Case No. 10-42517). Lisa A. Epps, Esq., at Spencer Fane Britt & Browne LLP, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. NOVADEL PHARMA: Posts $1.3 Million Net Loss in Q1 2010 ------------------------------------------------------ NovaDel Pharma Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $1,292,000 on $129,000 of revenue for the three months ended March 31, 2010, compared with a net loss of $2,139,000 on $66,000 of revenue for the same period ended March 31, 2009. For the quarter ended March 31, 2010, the loss from operations was $1,292,000 as compared to $2,018,000 for the quarter ended March 31, 2009. The decrease of $726,000 is attributable to reductions in overall spending as the Company has reduced project related activities, further reduced headcount and relocated its office facilities. The Company's balance sheet as of March 31, 2010, showed $5,032,000 in assets and $9,831,000 of liabilities, for a stockholders' deficit of $4,799,000. On March 31, 2010, the Company announced that it entered into a securities purchase agreement to raise roughly $1.5 million in gross proceeds through the sale of roughly 9 million shares of its common stock to selected institutional investors at a price of $0.165 per share. The investors received five year warrants to purchase roughly 4.5 million shares of common stock at an exercise price of $0.25 per share. In addition, the investors received six month warrants to purchase a roughly 3.0 million additional shares of common stock at an exercise price of $0.25 per share. The shares and warrants were offered as a registered direct offering under the Company's effective shelf registration statement previously filed with the Securities and Exchange Commission. The Company recorded net proceeds of $551,000 and a note receivable of $800,000 which cash proceeds were subsequently received on April 15, 2010. Steven B. Ratoff, Chairman and CEO said, "During the first quarter 2010, we continued to strengthen our balance sheet with a modest capital raise. In addition, we initiated our development of Duromist(TM), our oral spray formulation of sildenafil citrate for the treatment of erectile dysfunction. We anticipate we will have initial clinical results in the fourth quarter of this year. We also look forward to the commercialization by our licensees of Nitromist(TM) and Zolpimist(TM) later this year." As reported in the Troubled Company Reporter on April 6, 2010, J.H. Cohn LLP, in Roseland, N.J., 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 of the Company's recurring losses from operations and negative cash flows from operating activities. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?630d A full-text copy of the press release is available for free at: http://researcharchives.com/t/s?63c0 Bridgewater, N.J.-based NovaDel Pharma Inc. (OTC BB: NVDL) -- http://www.novadel.com/-- is a specialty pharmaceutical company developing oral spray formulations for a broad range of marketed pharmaceuticals. O&G LEASING: Schedules Filing Deadline Extended Until June 21 ------------------------------------------------------------- The Hon. Edward Ellington at the U.S. Bankruptcy Court for the Southern District of Mississippi extended, at the behest of O&G Leasing, LLC, et al., the deadline for the filing of schedules of assets and liabilities and statement of financial affairs for an additional 15 days, or until June 21, 2010. The filing deadline was initially June 4, 2010, but the Debtors said that despite diligent efforts to complete and file these items in a timely fashion, the Debtors do not anticipate being able to do so within that deadline. Analysis and organizing of the Debtors' financial affairs will require more time than 15 days to accurately report and disclose. Jackson, Mississippi-based O&G Leasing, LLC, filed for Chapter 11 bankruptcy protection on May 21, 2010 (Bankr. S.D. Miss. Case No. 10-01851). Douglas C. Noble, Esq., at McCraney Montagnet & Quin, PLLC, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. O&G LEASING: Section 341(a) Meeting Scheduled for June 28 --------------------------------------------------------- The U.S. Trustee for Region 5 will convene a meeting of O&G Leasing, LLC's creditors on June 28, 2010, at 1:30 p.m. The meeting will be held at 100 West Capitol Street, Suite 707, Dr. A. H. McCoy Federal Building, Jackson, MS 39269. 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. Jackson, Mississippi-based O&G Leasing, LLC, filed for Chapter 11 bankruptcy protection on May 21, 2010 (Bankr. S.D. Miss. Case No. 10-01851). Douglas C. Noble, Esq., at McCraney Montagnet & Quin, PLLC, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. OKCAL HOSPITALITY: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: OKCAL Hospitality, LLC aka Quality Inn 20887 Kelvin Place Woodland Hills, CA 91367 Bankruptcy Case No.: 10-16524 Chapter 11 Petition Date: May 31, 2010 Court: U.S. Bankruptcy Court Central District of California (San Fernando Valley) Judge: Maureen Tighe Debtor's Counsel: Jerome Bennett Friedman, Esq. 1901 Avenue of the Stars, Suite 1700 Los Angeles, CA 90067-4409 Tel: (310) 552-8210 Fax: (310) 733-5442 E-mail: jfriedman@jbflawfirm.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 $5,145,000 while debts total $5,735,484. 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/cacb10-16524.pdf The petition was signed by Delshad Rahman, manager. OLDE PRAIRIE: Section 341(a) Meeting Scheduled for June 24 ---------------------------------------------------------- The U.S. Trustee for Region 11 will convene a meeting of Olde Prairie Block Owner, LLC's creditors on June 24, 2010, at 1:30 p.m. The meeting will be held at 219 South Dearborn, Office of the U.S. Trustee, 8th Floor, Room 804, Chicago, Illinois 60604. 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. Chicago, Illinois-based Olde Prairie Block Owner, LLC, filed for Chapter 11 bankruptcy protection on May 18, 2010 (Bankr. N.D. Ill. Case No. 10-22668). John E. Gierum, Esq., at Gierum & Mantas, assists the Company in its restructuring effort. The Company listed $100,000,001 to $500,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. OMNICOMM SYSTEMS: Posts $1.5 Million Net Loss in Q1 2010 -------------------------------------------------------- OmniComm Systems, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $1,520,114 on $2,697,363 of revenue for the three months ended March 31, 2010, compared with net income of $97,093 on $2,416,657 of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $4,795,280 in assets and $22,484,371 of liabilities, for a stockholders' deficit of $17,689,091. As reported in the Troubled Company Reporter on April 6, 2010, Greenberg & Company LLC, in Springfield, N.J., 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 losses and has a net capital deficiency. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63bf Ft. Lauderdale, Fla.-based OmniComm Systems, Inc. (OTC: OMCM.OB) - - http://www.OmniComm.com/-- provides customer-driven Internet solutions to pharmaceutical, biotechnology, research and medical device organizations that conduct life changing clinical trial research. OMNICOMM SYSTEMS: Appoints Stephen Johnson as President and COO --------------------------------------------------------------- OmniComm Systems, Inc., announced Tuesday that Stephen Johnson has been promoted to president and chief operating officer. Mr. Johnson, who was most recently OmniComm's chief operating officer and executive vice president of business development, will continue to oversee operations and business development, but will take on additional executive responsibilities as well and will continue to report to chief executive officer, Cornelis F. Wit. OmniComm also announced that Kenneth Light has been promoted to executive vice president of operations and that Beverly Hudson has joined the Company as senior vice president of business development. Mr. Light was recently senior vice president of professional services at OmniComm and Ms. Hudson was recently vice president and general manager of Research Services Group of Medpoint Communications, Inc. About OmniComm Systems Ft. Lauderdale, Fla.-based OmniComm Systems, Inc. (OTC: OMCM.OB) - - http://www.OmniComm.com/-- provides customer-driven Internet solutions to pharmaceutical, biotechnology, research and medical device organizations that conduct life changing clinical trial research. The Company's balance sheet as of March 31, 2010, showed $4,795,280 in assets and $22,484,371 of liabilities, for a stockholders' deficit of $17,689,091. * * * As reported in the Troubled Company Reporter on April 6, 2010, Greenberg & Company LLC, in Springfield, N.J., 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 losses and has a net capital deficiency. ORLEANS HOMEBUILDERS: Faces Suit by NVR Over Jilted $170M Sale -------------------------------------------------------------- NVR Inc. has sued Orleans Homebuilders Inc. to obtain as much as $4.4 million in termination fees, saying the company reneged on a $170 million sale in favor of pursuing a Chapter 11 reorganization with senior lenders, according to Bankruptcy Law360. Law360 says the adversary complaint, filed Friday in the U.S. Bankruptcy Court for the District of Delaware, claims Orleans has not effectively terminated the $170 million stalking horse agreement. About Orleans Homebuilders Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in these 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). Cahill Gordon & Reindell LLP is the Debtor's bankruptcy and restructuring counsel. Curtis S. Miller, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, are the Debtor's Delaware and restructuring counsel. Blank Rome LLP is the Debtor's special corporate counsel. Garden City Group Inc. is the Debtor's claims and notice agent. The Company estimated assets and debts at $100,000,001 to $500,000,000. OSCIENT PHARMACEUTICALS: Files First Amended Chapter 11 Plan ------------------------------------------------------------ BankruptcyData.com reports that Oscient Pharmaceuticals filed with the U.S. Bankruptcy Court a First Amended Chapter 11 Plan of Reorganization and related Disclosure Statement. According to the Disclosure Statement, "The Debtors estimate that the aggregate amount of unsecured, non-priority Claims against the Oscient Estate is approximately $141 million (all of which is unsecured) and that the aggregate amount of Claims against the Guardian Estate is approximately $140.0 million (of which $82.9 million is secured debtor owed to Paul Royalty and $57.3 million is unsecured)." About Oscient Pharmaceuticals Based in Waltham, Massachusetts, Oscient Pharmaceuticals Corporation -- http://www.antararx.com/and http://www.factive.com/-- and its wholly owned subsidiary, Guardian II Acquisition Corporation, sell two products, ANTARA (fenofibrate) capsules, which is a cardiovascular product indicated for the adjunct treatment of hypercholesterolemia (high blood cholesterol) and hypertriglyceridemia (high triglycerides) in combination with diet, and FACTIVE (gemifloxacin mesylate) tablets, which is a fluoroquinolone antibiotic indicated for the treatment of acute bacterial exacerbations of chronic bronchitis and community-acquired pneumonia of mild to moderate severity. As of December 31, 2008, the Debtors' audited consolidated financial statements reflected total assets of $174.0 million and total liabilities of $255.2 million. Oscient Pharmaceuticals Corporation together with an affiliate filed for Chapter 11 on July 13, 2009 (Bankr. D. Mass. Case No. 09-16576). Judge Henry J. Boroff presides over the case. Charles A. Dale III, Esq., at K&L Gates LLP, represents the Debtors. The Debtors also hired Ropes & Gray LLP as special litigation counsel, and Broadpoint Capital Inc. as financial advisor. PAETEC HOLDING: CEO Chesonis Enters Trading Plan to Sell Stock -------------------------------------------------------------- PAETEC Holding Corp. said Arunas A. Chesonis, the chairman, president and chief executive officer, entered into a prearranged trading plan with a broker-dealer to sell and otherwise transfer by gift shares of PAETEC's common stock. The trading plan entered into by Mr. Chesonis provides for his sale of up to 2,000,000 shares of PAETEC common stock, and his transfer by gift of up to 575,000 shares of PAETEC common stock, during specified periods occurring between May 2010 and December 2011. The trading plan will not reduce the ownership of PAETEC shares by Mr. Chesonis below PAETEC's applicable stock ownership guidelines for executive officers. Any sales made pursuant to the trading plan will be based on share amounts and other conditions specified in the plan. All stock transfers under the trading plan will be disclosed publicly in accordance with applicable securities laws, rules and regulations through appropriate filings with the U.S. Securities and Exchange Commission. About PAETEC Holding PAETEC Holding Corp., through its subsidiaries, provides integrated communications services, including local and long distance voice, data, and broadband Internet access services, primarily to business and institutional customers. On February 8, 2008, PAETEC Holding completed its combination by merger with McLeodUSA Incorporated, which became a wholly owned subsidiary of PAETEC Holding upon completion of the merger. Effective on June 1, 2009, the Company entered into a Second Amendment and Waiver to its Credit Agreement with its lenders which amends the Credit Agreement, dated as of February 28, 2007, and amended as of June 27, 2007. The Amendment grants the Company the right, at its option and subject to specified conditions, voluntarily to prepay term loans outstanding under its term loan facilities at any time and from time to time during a period beginning on the effective date of the Amendment and ending 18 months after such effective date. The total cash payments to be made by the Company in connection with such voluntary prepayments may not exceed $100,000,000, excluding amounts applied to the payment of accrued and unpaid interest and fees. The Amendment also modifies some of the restrictive covenants in the Credit Agreement primarily to permit the Company to issue senior secured notes and to allow the Company and its subsidiaries to incur indebtedness and related obligations under such notes if specified conditions are satisfied. * * * As reported by the Troubled Company Reporter on June 18, 2009, Standard & Poor's Ratings Services assigned PAETEC Holding's proposed senior secured notes due 2017 an issue-level rating of 'B' (the same as the corporate credit rating) with a recovery rating of '3', indicating expectations for meaningful (50%-70%) recovery in the event of payment default. At the same time, S&P affirmed all other ratings on PAETEC, including the 'B' corporate credit rating. The outlook is stable. Moody's Investors Service assigned a B1 rating to the senior secured note issuance. Moody's affirmed all other ratings, including the SGL-1 liquidity rating. The rating outlook remains stable. PAUL WALLACE: Section 341(a) Meeting Scheduled for June 30 ---------------------------------------------------------- The U.S. Trustee for Region 2 will convene a meeting of Paul Wallace's creditors on June 30, 2010, at 1:00 p.m. The meeting will be held at United States Bankruptcy Court, SDNY, 300 Quarropas Street, Room 243A, White Plains, NY 10601-5008. 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. Bedford Hills, New York-based Paul F. Wallace filed for Chapter 11 bankruptcy protection on May 20, 2010 (Bankr. S.D.N.Y. Case No. 10-22998). Gerard DiConza, Esq., at DiConza Law, P.C., assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. PEARVILLE LP: Court Okays Spencer Crain as Bankruptcy Counsel ------------------------------------------------------------- Pearville, L.P., sought and obtained authorization from the Hon. Karen K. Brown of the U.S. Bankruptcy Court for the Southern District of Texas to employ Thomas H. Grace and the law firm of Spencer Crain Cubbage Healy & McNamara pllc as bankruptcy counsel. Spencer Crain will, among other things: a. prepare and pursue confirmation of a plan of reorganization and approval of a disclosure statement; b. prepare applications, motions, answers, proposed orders, other pleadings, notices, schedules and other documents, and review all financial and other reports to be filed; c. appear in Court to protect the interests of the Debtor before this Court; and d. represent the Debtor in connection with use of cash collateral and/or obtaining postpetition financing. Spencer Crain will be paid based on the hourly rates of its personnel: Thomas H. Grace $450 Meagan Martin $300 Paralegals $130 To the best of the Debtor's knowledge, Spencer Crain is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Houston, Texas-based Pearville, L.P., filed for Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. S.D. Texas Case No. 10-34074). The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. PRIME GROUP: Ends Employment of VP Jeremy Zednick ------------------------------------------------- Prime Group Realty Trust has ended the employment of Jeremy Zednick, company's vice president -- corporate accounting and principal accounting officer. Paul G. Del Vecchio, the company's Executive Vice President -- Capital Markets, will also serve as chief accounting officer of the company. About Prime Group Realty Trust Based in Chicago, Illinois, Prime Group Realty Trust (NYSE: PGEPRB) -- http://www.pgrt.com/-- is a fully-integrated, self- administered, and self-managed real estate investment trust which owns, manages, leases, develops, and redevelops office and industrial real estate, primarily in metropolitan Chicago. The Company currently owns 7 office properties containing an aggregate of roughly 3.2 million net rentable square feet and a joint venture interest in one office property comprised of roughly 101,000 net rentable square feet. The Company leases and manages roughly 3.2 million square feet comprising all of its wholly owned properties. In addition, the Company is the asset and development manager for an roughly 1.1 million square foot office building located at 1407 Broadway Avenue in New York. * * * As reported by the Troubled Company Reporter on December 15, 2009, Prime Group Realty Trust said the Company's Board of Trustees has determined not to declare a quarterly distribution on its Series B Preferred Shares for the fourth quarter of 2009, and that the Board is unable to determine when the Company might recommence distributions on the Series B Preferred Shares. According to the Troubled Company Reporter on March 3, 2010, Two of Prime Group Realty Trust's subsidiaries, each of which own separate portions of the Continental Towers Complex in Rolling Meadows, Illinois, are in default under their first mortgage loans encumbering the Complex. Continental Towers, L.L.C., a subsidiary of the Company, is the owner of Tower I, Tower III and the Commercium at the Continental Towers Complex. The CT Property is encumbered by a first mortgage loan from CWCapital LLC in the principal amount of $73.6 million. QUEPASA CORPORATION: Posts $2.7 Million Net Loss in Q1 2010 ----------------------------------------------------------- Quepasa Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $2,667,290 on $321,970 of revenue for the three months ended March 31, 2010, compared with a net loss of $2,553,800 on $69,159 of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $1,801,021 in assets and $6,531,480 of liabilities, for a stockholders' deficit of $4,730,459. As reported in the Troubled Company Reporter on March 9, 2010, Salberg & Company, P.A., in Boca Raton, Florida, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of the Company's net loss and net cash used in operating activities in 2009 of $10.6 million and $3.9 million, respectively, and stockholders' deficit and accumulated deficit of $3.9 million and $159.3 million, respectively, at December 31, 2009. "The Company's financial position and condition has deteriorated from December 31, 2009, to March 31, 2010. and the Company does not have sufficient cash to meets it needs for the next twelve months. There is no assurance that continued financing proceeds will be obtained in sufficient amounts necessary to meet the Company's needs. In view of these matters, continuation as a going concern is dependent upon the Company's ability to meet its financing requirements, raise additional capital, and the future success of its operations." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63c7 West Palm Beach, Fla.-based Quepasa Corporation (OTC BB: QPSA) through its Web site http://www.Quepasa.com/operates as an online social community for young Hispanics. R&G FINANCIAL: Court Extends Filing of Schedules by 30 Days ----------------------------------------------------------- The Hon. Enrique S. Lamoutte Inclan of the U.S. Bankruptcy Court for the District of Puerto Rico extended, at the behest of R&G Financial Corp., the deadline for the filing of schedules of assets and liabilities and statement of financial affairs by an additional 30 days. The Debtor is a former bank holding company whose principal asset was its 100% interest in R-G Premier Bank of Puerto Rico (the Bank). On April 30, 2010 the Bank, along with two other Puerto Rican banks, was closed by the Office of the Commissioner of Financial Institutions of the Commonwealth of Puerto Rico (the OCFI). The OCFI's closure of the Bank and appointment of the FDIC as receiver has temporarily barred the Debtor from accessing the information and records that it will need to accurately prepare its schedules and statement. The information includes crucial electronic records containing comprehensive lists of assets, liabilities, and payments made prior to bankruptcy. The information also includes records of the named holders of the Debtor's more than 51 million shares of outstanding common stock and 8.5 million shares of outstanding preferred stock. The Debtor was suddenly divested of access to crucial recordkeeping systems, it has not had a sufficient opportunity to record and evaluate all of the business transactions that occurred shortly before and after the closure of the Bank on April 30, 2010. San Juan, Puerto Rico-based R&G Financial Corporation filed for Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. D. P.R. Case No. 10-04124). Jorge I. Peirats, Esq., at Pietrantoni, Mendez & Alvarez, assists the Company in its restructuring effort. The Company listed $40,213,356 in assets and $420,687,694 in debts. REGAL CINEMAS: Inks Amended Credit Agreement with Credit Suisse --------------------------------------------------------------- Regal Cinemas Corporation entered into a sixth amended and restated credit agreement, with Credit Suisse AG, Cayman Islands Branch, as Administrative Agent and the lenders party thereto which amends, restates and refinances the fifth amended and restated credit agreement among Regal Cinemas, Credit Suisse, Cayman Islands Branch, and the lenders party thereto. The Amended Senior Credit Facility consists of a term loan facility in an aggregate principal amount of $1,250.0 million with a final maturity date in November 2016 and a revolving credit facility in an aggregate principal amount of $85.0 million with a final maturity date in May 2015. The Term Facility amortizes in equal quarterly installments in an aggregate annual amount equal to 1.0% of the original principal amount of the Term Facility, with the balance payable on the Term Facility maturity date. Proceeds of the Term Facility were applied to refinance the term loan under the Prior Senior Credit Facility, which had an aggregate principal balance of approximately $1,262.1 million. No amounts have been drawn on the Revolving Facility. The Amended Senior Credit Facility also permits Regal Cinemas to borrow additional term loans thereunder, subject to lenders providing additional commitments of up to $200.0 million and satisfaction of other conditions, as well as other term and revolving loans for acquisitions and certain capital expenditures subject to lenders providing additional commitments and satisfaction of other conditions. The obligations of Regal Cinemas are secured by, among other things, a lien on substantially all of its tangible and intangible personal property and certain owned real property. The obligations under the Amended Senior Credit Facility are also guarantied by certain subsidiaries of Regal Cinemas and secured by a lien on all or substantially all of such subsidiaries' personal property and certain real property pursuant to that certain second amended and restated guaranty and collateral agreement, dated as of May 19, 2010, among Regal Cinemas Corporation, certain subsidiaries of Regal Cinemas Corporation party thereto and Credit Suisse AG, Cayman Islands Branch, as Administrative Agent. The obligations are further guaranteed by Regal Entertainment Holdings, Inc., on a limited recourse basis, with such guaranty being secured by a lien on the capital stock of Regal Cinemas, and by REG on an unsecured basis. Borrowings under the Amended Senior Credit Facility bear interest, at Regal Cinemas' option, at either a base rate or an adjusted LIBOR rate plus, in each case, an applicable margin that is determined according to the consolidated leverage ratio of Regal Cinemas and its subsidiaries. Such applicable margin will be either 2.5% or 2.75% in the case of base rate loans and either 3.5% or 3.75% in the case of LIBOR rate loans. Interest is payable (a) in the case of base rate loans, quarterly in arrears, and (b) in the case of LIBOR rate loans, at the end of each interest period, but in no event less often than every 3 months. Regal Cinemas may prepay borrowings under the Amended Senior Credit Facility, in whole or in part, in minimum amounts and subject to other conditions set forth in the Amended Senior Credit Facility. Regal Cinemas is required to make mandatory prepayments with: * 50% of excess cash flow in any fiscal year, with elimination based upon achievement and maintenance of a leverage ratio of 3.75:1.00 or less; * 100% of the net cash proceeds of all asset sales or other dispositions of property by Regal Cinemas and its subsidiaries, subject to certain exceptions (including reinvestment rights); * 100% of the net cash proceeds of issuances of funded debt of Regal Cinemas and its subsidiaries, subject to exceptions; and * 50% of the net cash proceeds of issuances of equity securities by Regal Cinemas, including the net cash proceeds of capital contributions to Regal Cinemas, with elimination based upon achievement and maintenance of a leverage ratio of 3.75:1.00 or less. The Amended Senior Credit Facility includes several financial covenants including: * maximum ratio of (i) the sum of funded debt (net of unencumbered cash) plus the product of eight (8) times lease expense to (ii) consolidated EBITDAR (as defined in the Amended Senior Credit Facility) of 6.00 to 1.0 throughout the term of the Amended Senior Credit Facility; * maximum ratio of funded debt (net of unencumbered cash) to consolidated EBITDA of 4.00 to 1.0 throughout the term of the Amended Senior Credit Facility; * minimum ratio of (i) consolidated EBITDAR to (ii) the sum of interest expense plus lease expense of 1.50 to 1.0 throughout the term of the Amended Senior Credit Facility; and * maximum capital expenditures not to exceed 35% of consolidated EBITDA for the prior fiscal year plus a one-year carryforward for unused amounts from the prior fiscal year. The Amended Senior Credit Facility requires that Regal Cinemas and its subsidiaries comply with covenants relating to customary matters, including with respect to incurring indebtedness and liens, making investments and acquisitions, effecting mergers and asset sales, prepaying indebtedness, and paying dividends. Among other things, such limitations will restrict the ability of Regal Cinemas to fund the operations of REG or any subsidiary of REG that is not a subsidiary of Regal Cinemas, which guaranties the Amended Senior Credit Facility. The Amended Senior Credit Facility includes events of default relating to customary matters, including, among other things, nonpayment of principal, interest or other amounts; violation of covenants; incorrectness of representations and warranties in any material respect; cross default and cross acceleration with respect to indebtedness in an aggregate principal amount of $25.0 million or more; bankruptcy; judgments involving liability of $25.0 million or more that are not paid; ERISA events; actual or asserted invalidity of guarantees or security documents; and change of control. A full-text copy of the company's agreement is available for free at http://ResearchArchives.com/t/s?63d8 About Regal Cinemas Regal Cinemas operates the largest and most geographically diverse theatre circuit in the United States, consisting of 6,778 screens in 549 theatres in 39 states and the District of Columbia as of July 2, 2009, with over 245 million annual attendees for the 53 week fiscal year ended January 1, 2009. Its geographically diverse circuit includes theatres in all of the top 32 and 44 of the top 50 United States designated market areas. Regal Cinemas operates multi-screen theatres and, as of July 2, 2009, had an average of 12.3 screens per location, which is well above the North American motion picture exhibition industry 2008 average of 6.7 screens per location. Regal Cinemas develops, acquires and operates multi-screen theatres primarily in mid-sized metropolitan markets and suburban growth areas of larger metropolitan markets throughout the United States. Regal Cinemas also has an investment in National CineMedia, LLC, which primarily concentrates its efforts on in-theatre advertising and creating complementary business lines that leverage the operating personnel, asset and customer bases of its theatrical exhibition partners, which includes Regal Cinemas, AMC Entertainment, Inc. and Cinemark, Inc. National CineMedia operates the largest digital in-theatre network in North America and utilizes its in-theatre digital content network to distribute pre-feature advertising, cinema and lobby advertising and entertainment programming content. * * * According to the Troubled Company Reporter on May 11, 2010, Fitch Ratings has assigned a 'B+/RR4' rating to Regal Cinemas Corporation proposed $250 million note offering. The new notes will be issued out of the existing senior unsecured indenture dated July 15, 2009. Proceeds of the notes, together with proceeds from the new senior secured credit facility (which is expected to close concurrently with the note offering), are expected to be used to repay the current senior secured credit facility, repurchase the $52 million balance on Regal Cinemas subordinated notes, pays fees related to the financing transactions and for general corporate purposes, which may include the repayment or repurchase of other indebtedness. Regal Cinemas is an indirectly wholly owned subsidiary of Regal Entertainment Group (Regal). Moody's Investors Service rated Regal Cinemas Corporation's extended and amended $1.335 billion of bank credit facilities Ba3. RCC's $250 million add-on senior unsecured note issue was rated B2. Ratings are unchanged from those applicable to existing rated instruments. RCC is a wholly-owned subsidiary of Regal Entertainment Group, a publicly traded holding company. Since, when viewed over the horizon that includes the March 2011 retirement of Regal's convertible notes, the transaction is neutral to the corporate family's aggregate debt balance and credit profile, Regal's corporate family and probability of default ratings remain unchanged at the B1 rating level. As well, the company already has an SGL-1 speculative grade liquidity rating (indicating very good liquidity); while the transaction bolsters liquidity, the SGL rating also remains unchanged. The rating outlook also remains unchanged at stable. Standard & Poor's Ratings Services assigned the proposed $1.335 billion senior secured credit facilities of Regal Cinemas Corp., the operating subsidiary of Knoxville, Tenn.-based Regal Entertainment Group, its issue-level rating of 'BB-' (one notch higher than the 'B+' corporate credit rating on the company). S&P also assigned the facilities a recovery rating of '2', indicating its expectation of substantial (70% to 90%) recovery for lenders in the event of payment default. The credit facilities consist of a $1.25 billion term loan due 2016 and an $85 million revolving credit facility due 2015. RICHARD SECORD: Case Summary & 12 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Richard A. Secord 3811 East Ames Lake Dr. NE Redmond, WA 98053 Bankruptcy Case No.: 10-16244 Chapter 11 Petition Date: May 29, 2010 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Karen A. Overstreet Debtor's Counsel: Gayle E. Bush, Esq. Bush Strout & Kornfeld 601 Union St Ste 5000 Seattle, WA 98101 Tel: (206) 292-2110 E-mail: gbush@bskd.com Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 12 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb10-16244.pdf The petition was signed by Richard A. Secord. RIGGING & WELDING: Wants to Hire J Craig as Lead Counsel -------------------------------------------------------- Rigging & Welding Specialists, Inc., has sought permission from the U.S. Bankruptcy Court for the Southern District of Texas to employ J. Craig Cowgill & Associates, P.C., as lead counsel. J. Craig will: a. give Debtor legal advice with respect to the bankruptcy proceeding; b. prepare applications, answers, orders, reports and other legal papers; and c. perform all other legal services for the Debtor as debtor- in-possession which may be necessary in the bankruptcy proceeding. J. Craig will be paid based on the hourly rates of its personnel: J. Craig Cowgill, Attorney in Charge $450 Associate Attorney $350 Paralegal/Law Clerk $95-$125 J. Craig Cowgill, an attorney at J. Craig, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Baytown, Texas-based Rigging & Welding Specialists, Inc., filed for Chapter 11 bankruptcy protection on May 12, 2010 (Bankr. S.D. Case No. 10-34012). The Company listed $15,853,284 in assets and $17,547,127 in debts. R&G FINANCIAL: Taps Patton Boggs as Bankruptcy Counsel ------------------------------------------------------ R&G Financial Corporation has asked for permission from the U.S. Bankruptcy Court for the District of Puerto Rico to employ Patton Boggs LLP as bankruptcy counsel. Patton Boggs will, among other things: a. prepare applications, motions, complaints, answers, orders, reports, and other legal papers; b. appear in Court to protect the interests of the Debtor before the Court; c. attend meetings as requested by the Debtor; and d. prepare a plan of reorganization and all related documents. Brent R. McIlwain, a partner at Patton Boggs, says that will be paid based on the hourly rates of its personnel: Robert W. Jones, Partner $700 Brent R. McIlwain, Partner $550 Brian Smith, Associate $315 Junior Associate $315 Senior Partner $700 Mr. McIlwain assures the Court that Patton Boggs is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. San Juan, Puerto Rico-based R&G Financial Corporation filed for Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. D. P.R. Case No. 10-04124). The Company listed $40,213,356 in assets and $420,687,694 in debts. ROTHSTEIN ROSENFELDT: Ex-Bodyguard Pleads Guilty to Trashing Docs ----------------------------------------------------------------- Jacqueline Palank at Dow Jones' Daily Bankruptcy Review, citing the Miami Herald, says Enrique Ros, Scott Rothstein's former bodyguard, on Wednesday pleaded guilty to conspiring to shred financial documents at Mr. Rothstein's request. The report says Mr. Ros, along with two others -- including a man with alleged ties to the Mafia -- agreed to share in $79,000 of alleged Ponzi scheme proceeds in exchange for trashing the records of Rothstein's fraud. Despite receiving payment, the defendants never actually did so. Federal prosecutors discovered their involvement after Mr. Rothstein recorded phone calls and meetings with the defendants last fall. According to the report, a federal judge in August will sentence Mr. Ros on one charge of obstruction of justice. He had previously faced additional charges, such as money-laundering conspiracy, but prosecutors dropped those in a plea agreement. Mr. Ros faces about a year behind bars. Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA, has been suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed November 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non-existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on January 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. RPM INTERNATIONAL: Moody's Affirms 'Ba1' Subordinate Shelf Rating ----------------------------------------------------------------- Moody's Investors Service affirms RPM International Inc.'s Baa3 ratings after RPM announced plans to resolve the asbestos litigation involving subsidiaries Specialty Products Holding Corp. and Bondex International Inc. via the establishment of a 524(g) bankruptcy trust. Moody's affirmation of RPM's ratings, despite the vagaries of litigation and the uncertainty surrounding court rulings, assumes that the filing will result in the cessation of all current asbestos liability claims and that RPM's ultimate net exposure will be no worse than the current long lived efforts at resolving claims in state courts. Moody's estimates that final resolution will not take place for 3-4 years. The initial credit implications prior to a final settlement are modestly positive in terms of cash flow and the deconsolidation of the asbestos balance sheet reserve, which resides on Bondex's balance sheet. Moody's expects the filing will have no near term impact on current credit facilities and public debt. Approval of the plan will require agreement by at least 75% of, yet to be determined, claimants and by the US courts. The plans for a Trust are set up via a chapter 11 filing for SPHC/Bondex and the ultimate establishment of a Trust possibly funded with a combination of cash, equity, and notes. The assets of SPHC/Bondex include the stock of discrete operating companies. RPM has disclosed that the combined revenues and pre-tax income of these entities, for the 2009 fiscal year, were about $330 million and $20 million respectively, representing less than 10% of revenues and 11% of consolidated pre-tax income. The final plan, when approved, aims at achieving a permanent injunction limiting asbestos litigation to SPHC/Bondex thus capping RPM's total asbestos exposure and ending the administration and legal efforts related to this matter. Generally, Moody's considers a resolution of asbestos-related claims which places an effective cap on asbestos cost as positive as long as the additional cost in terms of cash flow and assets lost can be absorbed with Baa3 credit metrics and indirect effects on RPM's remaining business are considered immaterial. Moody's has identified RPM's asbestos exposure in its research on the company and factored potential cost and resolution scenarios into its rating analysis. In an Issuer Comment in July 2008, Moody's said: "RPM recently increased its asbestos reserve position by $288 million to $560 million (at February 28, 2010, the reserve was $430 million on an undiscounted basis) representing an extension of the reserve life from a current 10 year life to a 20 year life ending in 2028. Given the expected declining nature of the reserve, combined with RPM's steady business profile, Moody's believes that the current Baa3 rating and stable outlook incorporate the magnitude and scope of the asbestos issue as it is estimated at this time. The reserves are expected to be drawn down as expenditures are made for indemnity and defense costs in coming years, and adjusted when necessary. Moody's expects the annual draw down of this reserve will be higher in its earlier years and the annual impact will begin to materially decline over time." In fiscal 2010 Moody's estimates, RPM has paid $75 million ($49 million after tax) for asbestos settlements and legal defense. These payments will be stayed while the plan is negotiated and approved. If the plan is finalized RPM would effectively be able to replace these cash payments and the distractions and uncertainties of the legal proceedings with the contribution to a yet to be defined trust fund to be finalized presumably several years from now. Moody's believes that this amount could be materially less than RPM's current estimated reserves given the possibility of different estimates used to measure the asbestos claims liability in bankruptcy. Additionally Moody's believes management is committed to achieving and maintaining an efficient balance sheet, consistent with a Baa3 rating. The company's credit profile continues to benefit from a diverse portfolio of products that supply various consumer and industrial end-markets. Furthermore, RPM has many well-known brand names including Rust-Oleum, Bondo, Zinsser, and DAP. Most of RPM's products are specialty coatings and sealants with applications in corrosion control, waterproofing, sealing, flooring and roofing. The ratings affirmation reflects Moody's continued belief that RPM will meet the retained cash flow to total adjusted debt ratio of at least 20%, on a sustained basis. Ratings affirmed: RPM International Inc. * Senior unsecured notes -- Baa3 * Senior unsecured shelf -- (P)Baa3 * Subordinate shelf -- (P)Ba1 RPM United Kingdom G.P * Guaranteed senior unsecured notes -- Baa3 The Baa3 rating reflects Moody's expectation that RPM will not pursue large debt financed acquisitions and instead continue its historic focus on bolt-on acquisitions and joint ventures to augment organic growth. Additionally, RPM's rating is tempered by an elevated dividend and the expectation that management will continue to raise the dividend as earnings increase. RPM's renewal of its accounts receivable facility for three years and the amendment to its $400 million revolver due December 2011 relaxing the covenants are, on the margin, credit positives. The altered covenant definitions plus the addition of a new fixed charge ratio covenant serve to both relax and in some ways provide the potential for future discipline on capex and dividend cash flows which form a portion of the denominator of the covenant. This ratio, which is required to be 1.00 to 1.00, may exhibit some possible tightness, if the economy were to weaken, during fiscal 2010 and 2011. Any tightness, however, could be remedied with discipline in capex and dividend policies along with the benefit of cost cutting initiatives which should bolster EBITDA. RPM's stable outlook reflects the expected cessation of asbestos payments combined with the uncertainty over the negotiated size of the Trust's assets, as a function of the size of the liability, and timing of their placement in the Trust. Further reflected in the stable outlook is the generation of stable cash flows along with management's record of maintaining a relatively conservative financial profile. If the ratio of retained cash flow to total adjusted debt were to drop to below 20%, on a sustained basis, or if a large debt financed acquisition or share repurchase program were to cause this ratio to decline to below 20%, a review or lower ratings may be triggered. If management becomes more aggressive with its dividend policy, significantly increases its share repurchases, or takes other actions that are likely to materially weaken credit metrics, Moody's could reassess the appropriateness of the company's Baa3 ratings. Moody's most recent announcement concerning the ratings for RPM was on October 6, 2009, when Moody's assigned a Baa3 rating on RPM's senior unsecured notes. RPM International Inc., headquartered in Medina, Ohio, is a holding company, whose subsidiaries are manufacturers of specialty coating and other products for both industrial/professional and retail do-it-yourself markets. Sales on an LTM basis ending February 28, 2010 were $3.3 billion. RUSTICK LLC: Court Extends Filing of Schedules until June 13 ------------------------------------------------------------ The Hon. Thomas P. Agresti of the U.S. Bankruptcy Court for the Western District of Pennsylvania extended, at the behest of Rustick, LLC, the deadline for the filing of schedules of assets and liabilities and statement of financial affairs for an additional 30 days, or until June 13, 2010. Given that the Debtor has more than 50 creditors, and the fact that certain prepetition invoices have not yet been received or entered into Debtor's financial accounting systems, the Debtor has begun, but has not yet finished, compiling the information that will be required in order to complete the schedules and the statement. The Debtor has limited management staff available to compile the information needed for the schedules and the statement. Due to the numerous critical operational matters that the Debtor's accounting and legal personnel must address in the early days of this case, the Debtor anticipates that it won't be able to complete its schedules and statement in the time required under Federal Rule of Bankruptcy Procedure 1007(c). Kane, Pennsylvania-based Rustick, LLC, filed for Chapter 11 bankruptcy protection on May 13, 2010 (Bankr. W.D. Pa. Case No. 10-10902). Lawrence C. Bolla, Esq., at Quinn Buseck Leemhuis Toohey & Kroto Inc, assists the Company in its restructuring effort. The Company listed $1,000,001 to $10,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. RUSTICK LLC: Taps Dilworth Paxson as Bankruptcy Counsel ------------------------------------------------------- Rustick, LLC, has asked for authorization from the U.S. Bankruptcy Court for the Western District of Pennsylvania to employ Dilworth Paxson LLP as bankruptcy counsel. Dilworth Paxon will, among other things: a. prepare applications, pleadings, briefs, memoranda and other documents and reports as may be required; b. represent the Debtor at all hearings and adversary proceedings; c. represent the Debtor in its dealings with the estate's creditors and other parties-in-interest; and d. prepare a Plan and Disclosure Statement, as well as appropriate motions relating to the Debtor's liquidating plan and proposed auction sale. Dilworth Paxson will be paid based on the hourly rates of its personnel: Partners $350-$725 Associates $225-$350 Paralegals $130-$150 James J. Rodgers, a partner at Dilworth Paxson, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Kane, Pennsylvania-based Rustick, LLC, filed for Chapter 11 bankruptcy protection on May 13, 2010 (Bankr. W.D. Pa. Case No. 10-10902). The Company listed $1,000,001 to $10,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. RUSTICK LLC: Wants to Hire Quinn Law as Local & Conflicts Counsel ----------------------------------------------------------------- Rustick, LLC, has sought permission from the U.S. Bankruptcy Court for the Western District of Pennsylvania to employ Quinn Law Firm as local and conflicts counsel. The Debtor says, "Because the Debtor's proposed lead counsel, Dilworth Paxson LLP, is located in Philadelphia and has certain conflicts arising from its prior representation of Merrill Lynch Portfolio Management, Inc., and Bank of America in connection with matters relating to the Debtor, the Debtor deems it necessary that it be represented by local and conflicts counsel in these proceedings." Quinn Law will: a. give the Debtor legal advice with respect to matters involving Merrill Lynch and Bank of America; b. give the Debtor legal advice with respect to the local rules and practices of this Court; and c. perform other legal services for the Debtor which may be necessary, and which are not duplicative of the services provided to the Debtor by Dilworth. Lawrence C. Bolla, Esq., a member at Quinn Law, says that the firm will be paid based on the hourly rates of its personnel: Lawyers $160-$325 Paraprofessionals $65-$80 Kane, Pennsylvania-based Rustick, LLC, filed for Chapter 11 bankruptcy protection on May 13, 2010 (Bankr. W.D. Pa. Case No. 10-10902). The Company listed $1,000,001 to $10,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. SANTA CLARA: Promises to Fully Pay All East West Bank Debts ----------------------------------------------------------- Santa Clara Square, LLC, filed with the U.S. Bankruptcy Court for the Northern District of California amended Disclosure Statement explaining the proposed Plan of Reorganization. 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 that all allowed arrearages owing to East West Bank will be paid in full on the effective date, in cash from the Essex Loan or shareholder fund. In addition, the Plan provides for the payment of monthly interest payments to East West Bank for the duration of the term of the Plan. These payments will be made from net profits, the interest reserve account, the shareholder funds, the Essex Loan, or funds provided by members of Debtor. As reported in the Troubled Company Reporter on April 27, 2010, the Plan provides for a five year Plan term. Under the Plan, the Debtor will develop the property during the Term of the Plan. The development will be a mixed used residential and commercial project conducted in coordination with Essex. The Plan also provides that the claim of East West Bank may be satisfied from the sale of the property at any time, subject to any rights of Essex under the Loan Agreement. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/SantaClara_amendedDS.pdf About Santa Clara Square Los Altos, California-based Santa Clara Square, LLC, filed for Chapter 11 bankruptcy protection on December 21, 2009 (Bankr. N.D. Calif. Case No. 09-61196). Lawrence A. Jacobson, Esq., at the Law Offices of Cohen and Jacobson, assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. SECURELALERT INC: Posts $3.5 Million Net Loss in Q2 Ended March 31 ------------------------------------------------------------------ SecureAlert, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $3,505,433 on $3,006,288 of revenue for the three months ended March 31, 2010, compared with a net loss of $4,070,991 on $3,047,714 of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $13,210,763 in assets, $9,367,296 of liabilities, and $3,843,467 of stockholders' equity. The Company incurred a net loss of $9,030,636 for the six months ended March 31, 2010, and a loss from operations of $5,711,214. In addition, the Company had an accumulated deficit of $214,034,050 as of March 31, 2010. The Company believes these factors raise substantial doubt about its ability to continue as a going concern. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63c1 Headquartered in Sandy, Utah, SecureAlert, Inc. (formerly RemoteMDx, Inc.) (OTC BB: RMDX) -- http://www.securealert.com/-- and subsidiaries market and deploy offender management programs, combining patented GPS tracking technologies, fulltime 24/7/365 intervention-based monitoring capabilities and case management services. * * * As reported in the Troubled Company Reporter on January 18, 2010, Hansen, Barnett & Maxwell, P.C., in Salt Lake City, expressed substantial doubt about RemoteMDx, Inc., and subsidiaries' 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 independent public accounting firm reported that the Company has incurred losses and has an accumulated deficit. SES SOLAR: Posts $457,670 Net Loss in Q1 2010 --------------------------------------------- SES Solar Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $457,670 on zero revenue for the three months ended March 31, 2010, compared with a net loss of $626,377 on $1,022,416 of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $20,217,420 in assets, $18,643,976 of liabilities, and $1,573,444 of stockholders' equity. The Company has experienced losses from operations and anticipates incurring losses in the near future. The Company incurred a net loss of $457,670, generated a positive cash flow from operations of $2,550,194, and had a working capital deficiency of $16,339,591 as of March 31, 2010. "These matters raise substantial doubt about its ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63c8 Based in Geneva, Switzerland, SES Solar Inc. is a Delaware corporation engaged in the business of designing, engineering, producing and installing solar panels or modules and solar tiles for generating electricity. The Company conducts its operations through two wholly owned subsidiaries, SES Prod. S.A. and SES Societe d'Energie Solaire S.A. The Company's shares are quoted on the OTC Bulletin Board under the symbol "SESI.OB". * * * As reported in the Troubled Company Reporter on April 21, 2010, BDO Ltd., in Zurich, Switzerland, 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. SPECIALTY PRODUCTS: Files for Bankruptcy to Resolve Asbestos Suits ------------------------------------------------------------------ Reuters reports that Specialty Products Corp. and Bondex International Inc., subsidiaries of RPM International Inc., filed for Chapter 11 bankruptcy (Bankr. D. Del. Case No. 10-11780) to resolve thousands of asbestos-related lawsuits. The Company listed both assets and debts of between $100 million and $500 million. According to Reuters, the RPM entities entered into bankruptcy without a negotiated plan or outline of a settlement for claimants. Specialty Products noted that it had a commitment for $40 million from Wells Fargo Capital Finance to fund its bankruptcy. Specialty Products Corp. and Bondex International Inc., subsidiaries of RPM International Inc. -- http://www.rpminc.com/ -- which makes industrial coatings and sealants for waterproofing and general maintenance, and corrosion control. SPHERIS INC: U.S. Trustee Wants Disclosure of Sale Price -------------------------------------------------------- The U.S. Trustee is opposing Spheris Inc.'s decision to make a secret of the price it's willing to accept for selling a $17.5 million subordinated note received from purchasers who bought the business in April for $98.83 million. The U.S. Trustee said that creditors and parties-in-interest cannot evaluate the propriety of the proposed sale if they do not have knowledge of the purchase price. A hearing is scheduled on June 8 to consider the U.S. Trustee's objection. According to the report, Spheris, now formally named SP Wind Down Inc., is proposing to sell the subordinated note to Riva Ridge Master Fund Ltd. The five-year note starts off paying interest at 8%, rising to 12.5%. The purchasers of the assets have the right to prepay the note within six months for 77.5% of outstanding principal. The official creditors' committee supports the sale to Riva Ridge. About Spheris Inc. Headquartered in Franklin, Tennessee, Spheris Inc. -- http://www.spheris.com/-- is a global provider of clinical documentation technology and services. Spheris Inc., along with five affiliates, filed for Chapter 11 on Feb. 3, 2010 (Bankr. D. Del. Case No. 10-10352). Attorneys at Young Conaway Stargatt & Taylor, LLP, and Willkie Farr & Gallagher LLP represent the Debtors in their Chapter 11 effort. Jefferies & Company serve as financial advisors to the Debtors. Attorneys at Schulte Roth & Zabel LLP and Landis Rath & Cobb LLP serve as counsel to the prepetition and DIP lenders. Garden City Group Inc. is claims and notice agent. The petition says that assets range from $50,000,001 to $100,000,000 while debts range from $100,000,001 to $500,000,000. The estate of Spheris Inc. is now formally named SP Wind Down Inc. after it sold the business in April. CBay Inc.'s MedQuist Inc. purchased the domestic business of Spheris for $98.8 million. STATION CASINOS: Has OK to Hire Campbell as Litigation Counsel -------------------------------------------------------------- Station Casinos, Inc., received the Court's authority to employ Campbell & Williams as special litigation counsel for SCI and its wholly owned subsidiary Chapter 11 debtor GV Ranch Station, Inc., in connection with litigation commenced by Timothy Wright and GCR Gaming, LLC, nunc pro tunc to January 28, 2010. GVR has filed a motion seeking an order for the joint administration of its Chapter 11 case with the Chapter 11 cases of Station Casinos and its affiliates and the adoption of various motions in the Station Casinos Case. On January 7, 2010, a former employee of SCI, Timothy Wright, commenced an arbitration proceeding against SCI in which he alleged breach by SCI of his employment agreement. GCR Gaming, LLC, filed a Motion to Dismiss the GVR case or, in the alternative, seeking relief from the automatic stay. In conjunction with the GCR Motion, GCR Gaming, LLC served written discovery requests and noticed numerous depositions between March 16, 2010, and April 19, 2010, the hearing date on the GCR Motion. Paul S. Aronzon, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Los Angeles, California, relates that given the voluminous amount of discovery that will be occurring in a condensed period of time, it is necessary and desirable for the GV Ranch to employ special litigation counsel located in Las Vegas to assist Milbank, Tweed, Hadley & McCloy LLP with these matters. Mr. Aronzon avers that Campbell & Williams has been selected as Special Litigation Counsel for SCI and GVR based upon its substantial litigation experience in the District of Nevada. Campbell & Williams will act as local, special litigation counsel for SCI and GVR in matters involving Timothy Wright and GCR Gaming, LLC, including the taking and defending of depositions, providing assistance to Milbank in the drafting of court filings, and related matters. Campbell & Williams has entered into a retainer agreement with SCI, which contains further terms of the proposed employment. Campbell & Williams will bill SCI and GVR based upon hourly rates, which currently range from $650 per hour for partners to $75 per hour for paralegals. In addition, Campbell & Williams will seek reimbursement for expenses incurred in representation of SCI and GVR. J. Colby Williams, Esq., a partner at Campbell & Williams, tells the Court that his Firm has not shared or agreed to share compensation with any entity except among the partners and members of the Firm. Mr. Williams also assures the Court that neither the Firm, nor any partner in the Firm, has an interest materially adverse to the interest of the estate or any class of creditors and equity security holders in the matters on which it is to be retained, by reason of any direct or indirect relationship to, connection with, or interest in, the Debtor or an investment banker for any security of the Debtor, or for any other reason. Moreover, Mr. Williams avers, neither the Firm nor any of its partner represent any interest adverse to that of the Debtor or of the estate in the matters on which it is to be retained. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. The Company owns and operates Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Rancho and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Wildfire Boulder, Gold Rush Casino and Lake Mead Casino in Henderson, Nevada. Station also owns a 50% interest in Green Valley Ranch Station Casino, Aliante Station Casino and Hotel, Barley's Casino & Brewing Company, The Greens and Wildfire Lanes in Henderson, Nevada and a 6.7% interest in the joint venture that owns the Palms Casino Resort in Las Vegas, Nevada. In addition, the Company manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. Station Casinos Inc., together with its affiliates, filed for Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as local counsel. The Debtor is also hiring Lazard Freres & Co. LLC as investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SUMMIT HOTEL: Inks Amended Loan Agreement with First Nat'l Bank --------------------------------------------------------------- Summit Hotel Properties LLC entered into a First Amendment of First Amended and Restated Loan Agreement related to its credit pool line of credit with First National Bank of Omaha. The Credit Pool is for the purpose of providing interim financing for existing, newly acquired and constructed hotels. Each loan from the Credit Pool is classified as either a Pool One loan or a Pool Two loan. Loans from Pool One pay interest only for a maximum of two years. Loans from Pool Two are for a term of five years, and principal and interest payments are based upon a twenty-year amortization schedule. The interest rate for Pool One loans is 90-day LIBOR plus 4.0%, with a floor of 5.50%; the interest rate for Pool Two loans is 90- day LIBOR plus 4.0%, with a floor of 5.25%. The Credit Pool carries a covenant that the Company may not exceed an aggregate of $450 million outstanding debt without the prior approval of the lender. The company said it is further required to maintain a minimum aggregate debt service coverage ratio of 1.50 to 1.00. The First Amendment of First Amended and Restated Loan Agreement eliminates the lender's obligation to enter into any additional Pool One or Pool Two loans. A full-text copy of the Company's loan agreement is available for free at http://ResearchArchives.com/t/s?63cf About Summit Hotel Summit Hotel Properties, LLC is a developer, owner and manager of hotels categorized as mid-scale without food and beverage and upscale hotels located throughout the United States. As of December 31, 2009, the Company owned 65 hotels in 19 states. The Company's revenues and earnings are derived from hotel operations of its owned hotels. An affiliate, The Summit Group, Inc., provides a number of services for its hotels, including hotel operations management, location of acquisition targets and construction sites, development of construction sites, and construction supervision. As of December 31, 2009, Summit Hotel Properties had two wholly owned limited liability companies that own hotel properties. Summit Hospitality I, LLC owns 25 of the Company's hotels. In addition, Summit Hospitality V, LLC, is a wholly owned subsidiary, which owns 13 of the Company's hotels. * * * According to the Troubled Company Reporter on April 29, 2010, Summit Hotel Properties, LLC's forbearance agreement with Fortress Credit Corp. has expired on May 3. TENNECO INC: Fitch Rates Amended and Extended Loans at 'BB+/RR1' ---------------------------------------------------------------- Fitch Ratings expects to rate Tenneco Inc.'s amended and extended $550 million revolver and $150 million term loan 'BB+/RR1'. TEN's ratings are: -- Issuer Default Rating 'B+'; -- New senior secured revolving credit facility 'BB+/RR1'; -- New senior secured term loan 'BB+/RR1''; -- Existing senior secured term loan 'BB+/RR1'; -- Senior secured tranche B-1 letter of credit/revolving loan facility 'BB+/RR1'; -- Senior secured second lien notes'BB/RR2'; -- Senior unsecured notes 'B-/RR6'; -- Subordinated notes 'B-/RR6'. The Rating Outlook remains Positive. Approximately $1.3 billion of debt outstanding is covered by these ratings. Fitch will withdraw the rating on the existing senior secured term loan once it is repaid. The ratings are supported by improvements in the credit profile including the proposed extension of maturities for the revolver and term loan, Fitch's expectations for additional deleveraging in 2010 and an improved global automotive environment. The rating is also driven by the strong liquidity position and the outlook for significant revenue growth. This is due to expectations for higher light vehicle production globally and new opportunities for sales to commercial vehicles, which TEN has forecasted will be a significant addition to original equipment revenues going forward. Furthermore, during the challenges in 2009 the company took restructuring actions that should increase operating efficiencies and allow for margin expansion. The Positive Outlook is driven by Fitch's view that the company's credit profile will continue to improve, the profile could be strong for the new rating over the next 12 months and further positive ratings actions may be warranted if TEN's favorable operating trend persists and if the industry recovery continues. Concerns remain centered on revenue concentration in Europe given Fitch's outlook for lower vehicle production, the company's underfunded pension plan, exposure to commodities, and the possibility that working capital requirements may negatively impact free cash flow as a result of significant revenue growth. TEN is amending and extending its secured revolver $550 million revolver which was set to expire in March 2012; the proposed revolver would now expire in May 2014. Early termination can occur 91 days inside of the maturity date of the second lien notes (expires July 2013) and also 91 days inside the term loan B-1 (expires March 2014). With the refinancing of each piece of debt the early termination date is eliminated. The revolver also has a $50 million accordion feature. Additionally, TEN is replacing its secured term loan A due 2012 ($128 million outstanding) with a new $150 million secured term loan due 2014. Given the better automotive environment and improved credit profile at TEN, the covenant for the consolidated net leverage ratio on the new bank facility will be tightened by 0.5 times at the end of the second quarter (2Q10), 0.25x at the end of the third and fourth quarter of 2010. It will revert back to existing levels after that. The new consolidated net leverage ratio cannot exceed 4.5x at the end of 2Q10, 4.25x at the end of 3Q10 and 4.25x at the end of 4Q10. While the company's sales are globally diversified, 44% of its sales in 2009 were from Europe, South America and India, which is a concern. Fitch forecasts that European light vehicle sales will decline in 2010 due to the lack of government incentives to boost vehicle demand; as a result, production volumes are forecasted to slightly decline. This credit concern is mitigated by TEN's somewhat diverse sales mix. Sales to the original equipment manufacturers accounted for approximately 78% of sales and aftermarket sales contributed 22% to the top line in 2009. Furthermore, Fitch believes that material new wins, particularly in the non-automotive area, should provide solid top-line growth over the next several years in the event of continued weakness in automotive production. The Recovery Ratings on the senior secured facilities (revolving credit facility, new term loan B, and tranche B1) are 'RR1' which implies a recovery in the range of 91%-100%. Recovery ratings for the second lien notes remain 'RR2'; this implies a recovery between 71% and 90%. The senior unsecured and subordinated notes recovery ratings remain 'RR6' which reflects a recovery in the range of 0%-10%. The recovery ratings reflect Fitch's recovery expectations under a scenario in which distressed enterprise value is allocated to the various debt classes. In 2009, free cash flow was $121 million and Fitch expects it to be positive again in 2010 given the company's cash preservation initiatives. Fitch views the risk to the company's cash flow generation is working capital requirements to meet increases in revenues. With improved profits, leverage at the end of the recent quarter declined to 3.0x which is a significant decline from 3.6x at the end of 2009 (adjusted for the U.S. accounts receivable program for similar comparisons). Fitch projects that leverage could fall to below 3.0x during 2010. Liquidity at the end of 1Q10 was $822 million which consisted of $193 million of cash on the balance sheet and $629 million on the revolving credit facility. In addition, the company has two U.S. accounts receivable programs which can be used up to $150 million. At the end of the recent quarter, $127 million of the accounts receivable program was utilized. TEN also has European accounts receivable programs which benefits the company's liquidity position; some of these European programs can be cancelled with 30 days notice. At the end of 1Q10, TEN had $96 million on its European receivables programs. With the maturity date of the revolver and term loan moved from 2012 until 2014, TEN does not have any significant debt maturities until 2013 when $245 million of the second lien notes are due. At the end of 2009, the company's pension funding status for the U.S. plan was 58%, or $142 million unfunded. The company expects to make 2010 contributions of $54 million to the plan. Over the longer term, TEN's position in the emissions segment positions the company well to expand its customer base and volumes. Also over a longer time horizon, product demand should increase given plans for tighter emission standards and expected growth in revenues and profits that should come from TEN's migration to more technological, value-added products which should also support margins. TIMOTHY JOHN HEILMAN: Gets OK to Hire Gerry as Bankr. Counsel ------------------------------------------------------------- Timothy John Heilman and Darlys Lynn Heilman sought and obtained authorization from the U.S. Bankruptcy Court for the District of South Dakota to employ Gerry & Kulm Ask, Prof. LLC., as bankruptcy counsel. Gerry & Kulm will: a. file schedules and other documents as the Court may require; b. initiate or defend adversary proceedings and contested motions; c. negotiate with priority, secured and unsecured creditors; and d. provide related legal services. Gerry & Kulm will be paid based on the hourly rates of its personnel: Laura L. Kulm Ask, Attorney $150 Clair R. Gerry, Attorney $220 Gay Dempsey, Paralegal $120 Laura L. Kulm Ask, an attorney at Gerry & Kulm, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Warner, South Dakota-based Timothy John Heilman, aka Tim Heilman and Darlys Lynn Heilman, filed for Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. D. S.D. Case No. 10-10107). The Company estimated its assets and debts at $10,000,001 to $50,000,000. TITAN ENERGY: Posts $553,922 Net Loss in Q1 2010 ------------------------------------------------ Titan Energy Worldwide, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $553,922 on $3,017,037 of revenue for the three months ended March 31, 2010, compared with a net loss of $336,916 on $1,687,306 of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $5,795,478 in assets, $4,042,840 of liabilities, and $1,752,638 of stockholders' equity. As reported in the Troubled Company Reporter on April 7, 2010, UHY LLP, in Southfield, Mich., 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 of the Company's recurring losses and accumulated deficit. At March 31, 2010, the Company had an accumulated deficit of $26,809,528. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63cc Brighton, Mich.-based Titan Energy Worldwide, Inc., is a provider of onsite power generation, energy management and energy efficiency products and services. TLC VISION: Posts $2.3 Million Net Loss in Q1 2010 -------------------------------------------------- TLC Vision Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $2.3 million on $61.4 million of revenue for the three months ended March 31, 2010, compared with net income of $1.6 million on $69.4 million of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $115.0 million in assets and $176.7 million of liabilities, for a stockholders' deficit of $61.7 million. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63ba Based in Chesterfield, Mo., TLC Vision Corporation -- http://www.tlcvision.com/-- is North America's premier eye care services company, providing eye doctors with the tools and technologies needed to deliver high-quality patient care. Through its centers' management, technology access service models, extensive optometric relationships, direct to consumer advertising and managed care contracting strength, TLC Vision maintains leading positions in Refractive, Cataract and Eye Care markets. TLC Vision Corporation and two of its wholly owned subsidiaries, TLC Vision (USA) Corporation, and TLC Management Services, Inc. filed petitions for Chapter 11 on Dec. 21, 2009 (Bankr. D. Del. Case No. 09-14473). The petition says assets and debts are $100 million to $500 million. The Company's lead U.S. restructuring counsel is the law firm of Proskauer Rose LLP and Canadian restructuring counsel is the law firm of Torys LLP. The Company's financial advisor is Conway Del Genio Gries & Co., LLC. Epiq Bankruptcy Solutions is claims and notice agent. As reported in the Troubled Company Reporter on May 21, 2010, TLC Vision (USA) Corporation officially emerged from Chapter 11 as a newly reorganized private company. TOUSA INC: Citicorp Seeks to Intervene Transeastern's Appeal ------------------------------------------------------------ Citicorp North America Inc. has asked to intervene in a dispute between a group of Tousa Inc. lenders and Tousa's unsecured creditors, saying the outcome will determine whether the banking giant can recover $200 million on behalf of a separate group of lenders, Bankruptcy Law360 reports. Law360 says Citicorp filed a motion Friday in the U.S. District Court for the Southern District of Florida to intervene in an appeal by a group of lenders known as the Transeastern. 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. TOYS R: S&P Puts 'B' Corp. Credit Rating on CreditWatch Positive ---------------------------------------------------------------- Standard & Poor's Ratings Services said it placed its 'B' corporate credit rating on Wayne, N.J.-based Toys "R" Us Inc. on CreditWatch with positive implications. This rating action follows Toys' filing of a preliminary registration statement for a proposed IPO for its common stock for up to $800 million. The company plans to use the bulk of the proceeds to repay debt. The CreditWatch placement follows Toys' S-1 filing, under which it plans to sell up to $800 million in common stock. Toys plans to use the bulk of the proceeds to repay debt. "If completed, S&P expects debt reduction along with improvement in cash flow to result in meaningfully better credit protection measures," said Standard & Poor's credit analyst Ana Lai. S&P estimates that pro forma debt leverage will improve to about 5.4x, from 6.2x at Jan. 30, 2010. Furthermore, S&P expects that EBITDA coverage of interest would increase to about 2.4x on a pro forma basis, from 1.9x. "S&P plans to resolve this CreditWatch listing when the IPO is completed, with a likely outcome of a one-notch increase in the rating to 'B+' from 'B'," added Ms. Lai. In S&P's May 18, 2010 summary analysis on Toys, S&P said that S&P could raise the rating if debt leverage declines to less than 6x. Additional support for an upgrade comes from S&P's expectation that Toys' operating results will remain good because of management's success with its merchandising strategy and cost-control initiatives, as well as the positive effect of the store conversion program. S&P will also review and analyze the company's business prospects and financial policies in the future. TRAILER BRIDGE: Moody's Gives Stable Outlook; Affirms 'B3' Rating ----------------------------------------------------------------- Moody's Investors Service has changed the rating outlook of Trailer Bridge, Inc., to stable from negative and affirmed all existing ratings, including the B3 corporate family rating. Outlook stabilization reflects expectation that credit metrics should remain within the B3 band and follows substantial progress toward Trailer Bridge's final dismissal from a class action lawsuit related to anti-competitive activity in the Puerto Rico marine trade lane. In Moody's view, though the court order that dismissed Trailer Bridge from the civil case with prejudice was non-final, likelihood of related liability now seems low. Despite the weak Puerto Rico economy and a stiff pricing environment, volume growth with gradual market share gains, and ongoing fixed cost control supports the stable outlook. The outlook acknowledges that year-over-year margin gains may prove challenging in 2010, but volumes should sufficiently offset and drive a second, consecutive year of profitability. "Basically, Trailer Bridge's demonstrated ability to operate profitably in spite of a difficult operating environment suggested that -- with class action lawsuit dismissal at hand -- the outlook should be stabilized," said Moody's Assistant Vice President, Bruce Herskovics. The affirmed B3 corporate family rating reflects Trailer Bridge's high leverage, small size, and low earnings level. The rating acknowledges that Puerto Rico's economy will probably continue shrinking in 2010, limiting performance upside. Other key expectations include liquidity profile adequacy, debt to EBITDA at or below 6.0 times with EBIT to interest above 1.0 time. The SGL-3 speculative grade liquidity rating reflects an adequate liquidity profile. Adequacy stems from the $11 million cash balance as of March 31, 2010, and $8 million of availability under the asset-backed revolving credit facility. Quarterly funding of operating and debt service needs should be accomplished internally, diminishing likelihood of revolver reliance. However, without a refinancing, the $83 million of secured notes due November 2011 will soon become a current liability, and eventually could pressure the SGL-3 rating down. The ratings are: * Corporate family and probability of default, B3 * $83 million 9.25% senior secured notes due November 2011, B3 to LGD 3, 49% from LGD 4, 51% * Speculative grade liquidity, SGL-3 Moody's last rating action on Trailer Bridge occurred February 20, 2009, when the B3 corporate family rating was affirmed. Trailer Bridge, Inc., headquartered in Jacksonville, Florida is an integrated trucking and marine freight carrier that provides truckload freight transportation primarily between the continental U.S., Puerto Rico and Dominican Republic. Last twelve months ended March 31, 2010 revenues were approximately $118 million. TRIBUNE CO: Disclosure Statement Lacking Judge's Approval --------------------------------------------------------- Bill Rochelle at Bloomberg News reports that the bankruptcy judge concluded the May 28 hearing without an order approving the disclosure statement explaining the plan for Tribune Co. Tribune is still working with junior creditors to craft a discussion of their treatment. Tribune said it hopes to have the disclosure statement ready for the judge's approval by the end of this week. The plan is designed to implement a settlement negotiated with some creditors. Holders of $3.6 billion in pre-bankruptcy secured debt immediately came out opposing the plan and the settlement. 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) TRIDIMENSION ENERGY: Filing of Schedules Extended Until June 22 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Texas extended, at the behest of Tridimension Energy, L.P., et al., the deadline for the filing of schedules of assets and liabilities and statement of financial affairs for an additional 31 days, or until June 22, 2010. Due to the size and complexity of the Debtors' operations and these Cases, the Debtors anticipate that they will be unable to have the schedules and statement ready for filing within the initial fourteen-day deadline. The Debtors anticipate that it will take no more than forty-five days to complete, review, and file the schedules and statement with the Court. TriDimension Energy, L.P., and its operating subsidiaries, TDE Property Holdings, LP, Axis E&P, LP, Axis Onshore, LP, Axis Marketing, LP, and Ram Drilling, LP, are engaged in the acquisition, development, exploration, production, and sale of oil and natural gas in Louisiana and Mississippi. The Company leases approximately 165,218 gross acres of oil and gas property, and have proven reserves of approximately 5.1 million barrels of oil based on fourth quarter 2009 data. TriDimension Energy, L.P. and seven of its affiliated companies filed for Chapter 11 on May 21, 2010 (Bankr. N.D. Tex. Case No. 10-33565). The Company has retained Vinson & Elkins LLP as their lead bankruptcy counsel, Ottinger Hebert, L.L.C. as their special counsel, FTI Consulting, Inc. as their financial advisors, and Stephens Inc. as their investment bankers. TRUMP ENTERTAINMENT: Icahn, Beal File Adversary Suit ---------------------------------------------------- Bankruptcy Law360 reports that billionaire investor Carl Icahn has filed a lawsuit over Trump Entertainment Resorts Inc.'s recent handling of $28.4 million in investment alternative tax payments to a New Jersey development authority. Icahn Partners LP and Beal Bank, which hold Trump Entertainment's outstanding first-lien bank debt, brought the complaint Friday in the U.S. Bankruptcy Court for the District of New Jersey, according to Law360. About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the Company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC, and other affiliates filed for Chapter 11 on February 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. Garden City Group is the claims agent. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of December 31, 2008. Trump Hotels & Casino Resorts, Inc., filed for Chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No. 04-46898 through 04-46925). Trump Hotels' obtained the Court's confirmation of its Chapter 11 plan on April 5, 2005, and in May 2005, it exited from bankruptcy under the name Trump Entertainment Resorts Inc. UTGR INC: Chapter 11 Plan Held Up for Legislature ------------------------------------------------- UTGR Inc. had scheduled a confirmation hearing for approval of a reorganization plan incorporating a settlement with unsecured creditors. The bankruptcy judge was forced to put off the hearing until after the Rhode Island legislature passes legislation permitting the operational changes called for in the plan. As reported by the TCR in January 2010, UTGR reached a compromise with unsecured creditors, allowing the bankruptcy judge to approve a disclosure statement explaining the reorganization plan. Instead of 5%, unsecured creditors will receive a 65% recovery. For a recovery estimated at 89%, first-lien creditors owed $415 million will receive all the new stock plus a $300 million secured note. Second-lien creditors, owed $145 million, are to receive half of sale proceeds between $475 million and $575 million if the facility is sold within three years. They are to have 75% of sale proceeds above $575 million. The Plan provided that a condition precedent to it being effective is the passage of certain legislation by the Rhode Island General Assembly to enhance the Debtors' financial viability, including an extension in operating hours at Twin River to 24 hours a day, 7 days a week, and the elimination of the legislative requirement that the Debtors must conduct live dog racing to maintain their VLT license. UTGR Inc. is the operator of the Twin River racetrack-casino in Lincoln, Rhode Island. UTGR filed for Chapter 11 on June 23 (Bankr. D. Rhode Island Case No. 09-12418). The Debtors selected Jager Smith P.C. as counsel, and Winograd, Shine & Zacks P.C. as their co-counsel. It also hired Zolfo Cooper LLC as bankruptcy consultants and special financial advisors. Donlin Recano serves as claims and notice agent. In its bankruptcy petition, the Company estimated assets of less than $500 million and debt exceeding $500 million. W HOTEL: DekaBank Wants to Prevent Owner From Filing Ch. 11 Case ---------------------------------------------------------------- Seeking a foreclosure auction for a $64.5 million loan on the W Hotel in Manhattan's Union Square, DekaBank Deutsche Girozentrale has filed suit to prevent the private equity fund that now owns the luxury hotel from placing it under Chapter 11 bankruptcy protection, according to Bankruptcy Law360. Law360 says the adversary complaint, filed Saturday in the U.S. Bankruptcy Court for the District of Delaware, claims the debtor, LEM Capital LLC unit Hotels Union Square Mezz 1 LLC. As reported in the Troubled Company Reporter on December 9, 2009, Dow Jones Newswires' Lingling Wei said Dubai World's Istithmar World Capital lost W Hotel Union Square in Manhattan to a foreclosure auction. Istithmar, Dubai World's private-equity arm, acquired the property for about $282 million in 2006. In December 2009, the property was sold for $2 million. Dow Jones said the W Hotel in October defaulted on $117 million in junior debt. The $115 million first mortgage, sliced into commercial mortgage-backed securities, was transferred in September to a special servicer in charge of handling loans in danger of imminent default. WASHINGTON MUTUAL: Creditors Press to Convert Ch. 11 to Ch. 7 Case ------------------------------------------------------------------ American Bankruptcy Institute reports that pressure is mounting on Washington Mutual Inc. as creditors unhappy about the continued turmoil in the chapter 11 case are now calling for the company's bankruptcy to be converted into a chapter 7 proceeding. Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP, served as legal counsel to WMI with responsibility for the litigation. Brian Rosen, Esq., at Weil, Gotshal & Manges LLP served as legal counsel to WMI with responsibility for the chapter 11 case. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WASHINGTON MUTUAL: Faces New Round of Disclosure Objections ----------------------------------------------------------- Bankruptcy Law360 reports that a slew of objections has poured in against Washington Mutual Inc.'s latest disclosure statement, many taking issue with a global settlement the bank reached with new owner JPMorgan Chase & Co. and the Federal Deposit Insurance Corp. Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP, served as legal counsel to WMI with responsibility for the litigation. Brian Rosen, Esq., at Weil, Gotshal & Manges LLP served as legal counsel to WMI with responsibility for the chapter 11 case. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WASHINGTON MUTUAL: Hearing on Conversion Motion on Thursday ----------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Washington Mutual, the official equity holders' committee and some creditors are trying to outsmart one another with legal strategies to push through or kill the global settlement that underpins WaMu's reorganization plan. According to the report, the bankruptcy judge presiding over Washington Mutual Inc.'s Chapter 11 case will convene a hearing on June 3 to consider a request by holders of $2.3 billion in debt securities to convert the Chapter 11 case to a liquidation in Chapter 7 where a trustee would be appointed automatically. Alternatively, the noteholders want the judge to appoint a Chapter 11 trustee. In April, shareholders won a ruling that allowed them to initiate a lawsuit in Washington State court compelling the bank holding company to hold an annual meeting. If the meeting were held, shareholders might succeed in ousting the board and installing their own candidates who then would have power to pull WaMu out of a global settlement the shareholders oppose. If the noteholders were to win a favorable ruling at the June 3 hearing, a trustee would supplant the board, thus preventing shareholders from having a new WaMu board back out of the global settlement, Bloomberg relates. According to bloomberg, WaMu has been employing its own legal tactics that could be designed to slow the movement toward a shareholders' meeting. First, WaMu had the suit in Washington state court removed to federal court. From there, WaMu has a motion pending to send the case eventually to the bankruptcy judge in Delaware. The motion to transfer the case to Delaware is scheduled for argument June 11 in Washington, the equity committee says in court papers. Meanwhile, holders of notes issued by the bank subsidiary filed papers urging the bankruptcy judge to appoint a trustee in either Chapter 7 or Chapter 11. The bank bondholders are also opposing the global settlement. According to Mr. Rochelle, having a Chapter 11 trustee might not interfere with creditors who favor the global settlement because WaMu's exclusive right to file a Chapter 11 plan has elapsed. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP, served as legal counsel to WMI with responsibility for the litigation. Brian Rosen, Esq., at Weil, Gotshal & Manges LLP served as legal counsel to WMI with responsibility for the chapter 11 case. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WAVERLY GARDENS: Amends Outline for Reorganization Plan ------------------------------------------------------- Waverly Gardens of Memphis, LLC and Kirby Oaks Integra, LLC, filed with the U.S. Bankruptcy Court for the Western District of Tennessee amended Disclosure Statement explaining the proposed Plan of Reorganization. According to the amended Disclosure Statement, the Plan provides for the Debtors to convey all of the assets to Newco. The assets of the Debtors will be assigned to Newco or its subsidiaries free and clear of all liens, claims, and encumbrances or interests, except to the extent that the liens and claims are conveyed, granted or retained under this Plan pursuant to the terms of the APA. In order to satisfy the payment of administrative claims payable on the effective date, other than administrative claims, and to provide post-confirmation working capital and approved capital expenditures, First Tennessee will make a $500,000 loan to Newco. Treatment of Claims Class 1 -- Secured Claim of First Tennessee to be paid as: (i) the Debtors will convey all assets to Newco or its designated subsidiaries; (ii) Newco will obtain $4,000,000 financing from First Tennessee; (iii) Newco will commence making monthly principal payments in the amount of $5,000 to First Tennessee on the 10th month after the effective date; (iv) Commencing on the 13th after the Effective Date, Newco will make monthly principal payments in the amount of $10,000 until the maturity date. First Tennessee will have no ownership or equity interest in the Newco. Class 2 -- Claim of Marger Partners will be extinguished as of the effective date. Marger will receive, $14,800 (4%) upon the sale or refinance of the facilities. Class 3 - Allowed Claims for prepetition real property and personalty taxes held by the City of Memphis and Shelby County Trustee will be paid by Newco in equal monthly installments over a period not to exceed 60 months from the petition date. Class 4 - Allowed Unsecured Priority Claims will be paid by Newco in equal monthly installments over a period not to exceed 60 months from the petition date at the applicable statutory rate of interest; provided, however, that in the event of a sale of the facilities or other assets of the Debtors the balance of each of the Allowed Claims of Class 4 Creditors will be paid out of the net proceeds of a sale after satisfaction of any secured claims or prior class claims. Class 5 - Holders of General Unsecured Claims will receive payment equal to 2% of the Allowed Claim. The Interests of the Debtors will be cancelled as of the effective date. A full-text copy of the amended Disclosure Statement is available for free at http://bankrupt.com/misc/WAVERLYGARDENS_AmendedDS.pdf About Waverly Gardens of Memphis Memphis, Tennessee-based Waverly Gardens of Memphis, LLC and Kirby Oaks Integra, LLC -- http://www.waverlygardens.com/-- operate two senior living facilities consisting of a total of 248 units. Waverly Gardens consists of 196 rental units and is located at 6539 Knight Arnold Road, Memphis, Tennessee 38115. Kirby Oaks consists of 52 rental units and is located at 6551 Knight Arnold Road, Memphis, Tennessee 38115. The Debtors filed separate petitions for Chapter 11 relief on Oct. 2, 2008 (Bankr. W.D. Tenn. Lead Case No. 08-30218). Michael P. Coury, Esq., and Robert Campbell Hillyer, Esq., at Butler, Snow, O'Mara, Stevens & Cannada, represent the Debtors as counsel. When Waverly Gardens filed for protection from its creditors, it listed assets of between $10 million to $50 million, and debts of $1 million to $10 million. When Kirby Oaks filed for protection from its creditors, it listed between $1 million and $10 million each in assets and debts. WESTAR ENERGY: Fitch Affirms Preferred Stock Rating at 'BB+' ------------------------------------------------------------ Fitch Ratings has affirmed the ratings for Westar Energy, Inc. and its utility subsidiary Kansas Gas and Electric Company: Westar -- Long-term Issuer Default Rating at 'BBB-'; -- Senior secured debt at 'BBB+'; -- Senior unsecured debt at 'BBB'; -- Preferred stock at 'BB+'; -- Short-term IDR and commercial paper at 'F3'. KGE -- Long-term IDR to 'BBB-'; -- Senior secured debt at 'BBB+'; -- Short-term IDR and CP at 'F3'. In addition, Fitch has revised the Rating Outlook on both entities to Positive from Stable. More than $2 billion of long-term debt is affected by these rating actions. The ratings and Positive Rating Outlook on Westar and KGE primarily reflect recent regulatory decisions and cost-recovery mechanisms that will allow the utility to earn a reasonable return on invested capital and limit the negative effects of commodity price volatility. Fitch expects continued improvement in Westar's consolidated credit metrics, with EBITDA interest coverage improving to above 4.0 times and funds from operations -to- adjusted debt approaching 18% over the next two years. Other key analytical factors include management's fiscal prudence and focus on core utility operations, which have reduced the overall risk profile of the consolidated entity. These strengths are tempered by a moderately large capital spending program and a recovering local economy. Westar's 2008 general rate case settlement with the Kansas Corporation Commission and the abbreviated 2009 rate case settlement authorized recovery of costs primarily associated with construction of the Emporia Energy Center and wind generation facilities. These settlements added $130 million in annual revenue effective February 2009 and $17.1 million in annual revenue effective February 2010, strengthening Westar's financial metrics. Fitch expects the company to continue to receive timely recovery of future power procurement costs and environmental and transmission investments, supporting Fitch's estimates of improving utility cash flow and leverage metrics. In recent years the KCC has implemented several cost-recovery mechanisms that facilitate recovery of fuel and purchase power costs and environmental and transmission investments outside of GRC proceedings. These rate riders have reduced regulatory lag and provided stability to the financial profile. The retail energy cost adjustment adjusts fuel and purchased power prices on a quarterly basis and settles the associated accruals and deferrals annually, largely mitigating the negative effects of fuel and power price volatility. The environmental cost recovery rider adjusts retail rates annually to reflect capital costs for emission controls, which are expected to account for 40% of consolidated capital expenditures during the 2010-2012 time period. Other cost-recovery mechanisms authorized by the KCC include a transmission cost-recovery rider for retail rates and a pension and other post-employment benefits expense tracker. In addition, the Federal Energy Regulatory Commission allows for recovery of transmission capital expenditures and cost of service through a formula rate that is updated annually. Management remains focused on Westar's core utility operations and strengthening its balance sheet. Generation, transmission, and environmental projects have been funded with a balanced mix of debt and equity, and the company's capital expenditure budget has been structured prudently and spread out over many years so as to not stress financial performance. The company also created a new $500 million at-the-market dribble program in the first quarter that will provide additional equity over the next three years. Westar's consolidated capital expenditure budget was scaled back last year and is expected to total nearly $2.4 billion during the 2010-2012 time period. Approximately $946 million of that amount is targeted for environmental upgrades to reduce harmful emissions from the company's coal-fired power plants. The recent settlement agreement with the Environmental Protection Agency will require Westar to reduce nitrogen oxide emissions at the Jeffrey Energy Center by installing a selective catalytic reduction system at one of Jeffrey's three units by 2014. Westar estimates the SCR will cost $200 million, with the majority spread over the 2012-2014 time period. The company would be able to do less costly modifications on the other two units if it is anticipated that one SCR would meet the necessary emissions targets. Capital spending on transmission includes about $100 million on the second phase of the Wichita-Salina line from Hutchinson to Salina, which is expected to be completed later this year, and about $90 million on the Rose Hill-Oklahoma line, with construction occurring following the completion of the Wichita- Salina line. The FERC allows a return on equity of 11.3% for the company's transmission projects, with an incentive ROE of 12.3% for the Wichita-Salina line. Westar's wholly owned transmission projects and its Prairie Wind Transmission, LLC (not rated by Fitch) 50/50 joint venture with Electric Transmission America (not rated) should continue to provide a platform for growth over the next several years, while further diversifying cash flows from Westar's electric distribution operations. Liquidity is adequate, supported by a $730 million revolving credit facility that expires on March 17, 2012. Westar has the ability to expand the facility to $1 billion, which should give the company additional financial flexibility in carrying out its major construction projects. The credit ratings for Westar and KGE are the same, reflecting centralized operations and treasury functions and a consolidated capital structure used for ratemaking. Westar and KGE conduct business under the Westar Energy brand name and have functionally integrated utility operations. KGE relies on Westar for its short-term cash needs, and Westar's revolving credit facility is secured by KGE's first mortgage bonds. Furthermore, no regulatory or corporate structures are currently in place to restrict the migration of cash between parent and subsidiary. Westar is the largest electric utility company in Kansas, providing electric generation, transmission, and distribution services to approximately 685,000 customers in the state. Westar directly provides these services to more than 370,000 customers in central and northeastern Kansas. KGE, Westar's wholly owned utility subsidiary, provides these services to nearly 315,000 customers in south-central and southeastern Kansas. The company has about 6,800 megawatts in aggregate of electric generation capacity, fueled primarily by coal and natural gas, as well as by KGE's 47% interest in the Wolf Creek nuclear power plant located near Burlington, Kansas. Westar operates and coordinates more than 6,200 miles of electric transmission lines. WESTSIDE DEVELOPMENT: Can Hire Kenneth Wrobel as Bankr. Counsel --------------------------------------------------------------- Westside Development Group LLC sought and obtained permission from the U.S. Bankruptcy Court for the Eastern District of Michigan to employ Kenneth J. Wrobel Jr., Attorney at Law, as bankruptcy counsel. Mr. Wrobel will, among other things: a. submit applications and proposed orders to the Court; b. identify and prosecute claims and causes of action assertable on behalf of the estate; c. advise the Debtor and prepare documents in connection with the reorganization of the estate, including analysis and connection of outstanding receivables; and d. assist in obtaining credit, negotiation of the sale of assets, arranging adequate protection, and negotiating a plan of reorganization. Mr. Wrobel will be paid $325 per hour for his services. Mr. Wrobel assures the Court that he is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Royal Oak, Michigan-based Westside Development Group, LLC, aka Sorano Commercial Village, filed for Chapter 11 bankruptcy protection on May 13, 2010 (Bankr. E.D. Mich. Case No. 10-55931). Kenneth J. Wrobel Jr., Esq., who has an office in Birmingham, Michigan, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. WIZZARD SOFTWARE: Posts $1.4 Million Net Loss in Q1 2010 -------------------------------------------------------- Wizzrd Software Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $1.4 million on $1.3 million of revenue for the three months ended March 31, 2010, compared with a net loss of $1.3 million on $1.2 million of revenue for the same period ended March 31, 2009. The Company's balance sheet as of March 31, 2010, showed $21.5 million in assets, $2.8 million of liabilities, and $18.7 million of stockholders' equity. "The Company has current liabilities in excess of current assets, incurred significant losses and has not yet been successful in establishing profitable operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?63c5 Pittsburgh, Pa.-based Wizzard Software Corporation provides software products and services for the speech recognition and text-to-speech technology. It operates in three segments: Software, Healthcare, and Media Services. The Software segment engages in the development, sale, and service of custom and packaged computer software products. The Media Services segment provides podcast hosting, content management tools, and advertising services. The Healthcare segment provides home healthcare and healthcare staffing services in Wyoming and Montana. * * * As reported in the Troubled Company Reporter on April 6, 2010, Gregory & Associates, LLC, in Salt Lake City, 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 not yet established profitable operations and has incurred significant losses since its inception. YUVAL RAN: 5th Cir. Rejects Israeli Receiver's Chapter 15 Filing ---------------------------------------------------------------- WestLaw reports that an Israeli bankruptcy receiver that filed a petition for recognition of a bankruptcy proceeding that was pending against an individual debtor in Israel as either a foreign main or foreign nonmain proceeding, failed to rebut the presumption that the United States was the debtor's "center of main interest" (COMI) when the petition was filed, as required to establish the foreign proceeding's status as a foreign main proceeding under Chapter 15. The receiver presented evidence that the debtor's creditors were located in Israel, that the debtor's principal assets were being administered in the bankruptcy pending in Israel, and that the debtor's bankruptcy proceedings initiated in Israel and would be governed by Israeli law. However, the evidence presented by the receiver was outweighed by evidence that the debtor along with his family left Israel nearly a decade prior to the filing of the petition, that the debtor had no intent to return to Israel, and that the debtor had established employment and a residence in Houston, Texas. The case presented a matter of first impression before the Court of Appeals for the Fifth Circuit. In re Ran, --- F.3d ----, 2010 WL 2106638 (5th Cir.). The Fifth Circuit's decision affirms Lavie v. Ran, --- B.R. ----, 2009 WL 890387 (S.D. Tex.), reported about in the Troubled Company Reporter on June 22, 2009. A summary of the chapter 15 filing appeared in the Dec. 15, 2006, edition of the Troubled Company Reporter. * PwC Loses Ruling in Pennsylvania Hospital System Bankruptcy Case ------------------------------------------------------------------ American Bankruptcy Institute reports that PricewaterhouseCoopers LLP suffered a defeat on Friday when the U.S. Court of Appeals for the Third Circuit ordered an inquiry into whether the auditor dealt in good faith with a large Pennsylvania hospital system that went bankrupt. * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ------------------------------------------------------------- Recent Chapter 11 cases filed with assets and liabilities below $1,000,000: 1. cases In Re Norrie Corporation and In Re Garrison Road, LLC are miscs of may13&14 and are highlighted in pink. I also passed these cases yesterday to kuya carlo. 2. case In Re DRJ Properties, LLC has no link to its petition and is highlighted in yellow. In Re Norrie Corporation Bankr. C.D. Calif. Case No. 10-29146 Chapter 11 Petition Filed May 13, 2010 In Re Garrison Road, LLC Bankr. D. Md. Case No. 10-20890 Chapter 11 Petition Filed May 14, 2010 In Re ESDSD, Inc. Bankr. C.D. Calif. Case No. 10-31023 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/cacb10-31023.pdf In Re Valley Developers, LLC Bankr. D. Colo. Case No. 10-22858 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/cob10-22858.pdf In Re Cast, LLC Bankr. D. Md. Case No. 10-21711 Chapter 11 Petition Filed May 25, 2010 Filed As Pro Se In Re Shrewsbury Street Development Companies, Inc. Bankr. D. Mass. Case No. 10-42655 Chapter 11 Petition Filed May 25, 2010 Filed As Pro Se In Re Arendal Dental Clinic, PA Bankr. D. Minn. Case No. 10-33846 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/mnb10-33846.pdf In Re Paul Michael Ryan Aitchison aka Paul Michael Ryan Aitchison Bankr. D. Nev. Case No. 10-19590 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/nvb10-19590.pdf In Re Diana L. Saada Bankr. D. N.J. Case No. 10-25941 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/njb10-25941.pdf In Re Joseph Karamikian Bankr. S.D. N.Y. Case No. 10-12749 Chapter 11 Petition Filed May 25, 2010 Filed As Pro Se In Re Phoenix Equities, Inc. Bankr. S.D. N.Y. Case No. 10-12747 Chapter 11 Petition Filed May 25, 2010 Filed As Pro Se In Re Maddi's Gallery, LLC aka succesor in interest to Maddis Southern Bistro LLC Bankr. W.D. N.C. Case No. 10-31462 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/ncwb10-31462.pdf In Re Westgate Development Co., LLC Bankr. N.D. Ohio Case No. 10-33607 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/ohnb10-33607.pdf In Re Royal Flush, Inc. Bankr. W.D. Pa. Case No. 10-23772 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/pawb10-23772.pdf In Re Gibson and Epps, L.L.C. dba Gibson & Epps, L.L.C. Bankr. E.D. Tenn. Case No. 10-32594 Chapter 11 Petition Filed May 25, 2010 Filed As Pro Se In Re Harvey W. McDonald aka Mac McDonald Tracy P. McDonald Bankr. M.D. Tenn. Case No. 10-05523 Chapter 11 Petition Filed May 25, 2010 See http://bankrupt.com/misc/tnmb10-05523.pdf In Re Mark Howard Bankr. D. Utah Case No. 10-27054 Chapter 11 Petition Filed May 25, 2010 Filed As Pro Se In Re Athens Foot Center, LLC dba Athens Podiatry Center Bankr. N.D. Ala. Case No. 10-82158 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/alnb10-82158p.pdf See http://bankrupt.com/misc/alnb10-82158c.pdf In Re Jung Hee Kim dba Grace Acupuncture Clinia Bankr. C.D. Calif. Case No. 10-31353 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/cacb10-31353.pdf In Re Mission Baking, Inc. dba Heirloom Bakery & Cafe Bankr. C.D. Calif. Case No. 10-31320 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/cacb10-31320.pdf In Re DRJ Properties, LLC Bankr. D. Colo. Case No. 10-23052 Chapter 11 Petition Filed May 26, 2010 In Re McCall's Holdings, LLC Bankr. M.D. Fla. Case No. 10-12528 Chapter 11 Petition Filed May 26, 2010 Filed As Pro Se In Re IC-Intl. Concepts Corporation Bankr. N.D. Ga. Case No. 10-22412 Chapter 11 Petition Filed May 26, 2010 Filed As Pro Se In Re Traylor Multimedia, Inc. dba 360KID Bankr. D. Mass. Case No. 10-15725 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/mab10-15725.pdf In Re Christine Persaud Bankr. E.D. N.Y. Case No. 10-44815 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/nyeb10-44815.pdf In Re Brigman's Valley Funeral Service, Inc. Bankr. W.D. N.C. Case No. 10-10608 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/ncwb10-10608.pdf In Re Larry Joe Eaves Delicia Janel Eaves Bankr. E.D. Texas Case No. 10-90214 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/txeb10-90214.pdf In Re Jerry Reed White Laurie Jane White fka Laurie Jane Bannert Bankr. W.D. Texas Case No. 10-11461 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/txwb10-11461.pdf In Re Bridgette Properties, Inc. Bankr. E.D. Va. Case No. 10-72517 Chapter 11 Petition Filed May 26, 2010 See http://bankrupt.com/misc/vaeb10-72517.pdf ********* 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. 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