/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100917.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, September 17, 2010, Vol. 14, No. 258 Headlines 6620 HAZELTINE: Case Summary & 14 Largest Unsecured Creditors A & M GLOBAL: Voluntary Chapter 11 Case Summary ALERE INC: S&P Assigns 'B-' Rating on $350 Mil. Senior Notes AMBERTON APARTMENTS: Tanglewood St. Petersburg's Case Summary ARCHWAY COOKIES: Payments to Supplier Weren't Preferential ARTECITY PARK: To Get $2.7 Million Loan from Corus JV ARTURO RUELAS: Case Summary & 20 Largest Unsecured Creditors ASARCO LLC: Court OKs Charter Oak's $3.47 Mil. in Fees & Expenses ASARCO LLC: Court OKs Transfer of Funds From TCEQ ASARCO LLC: Plan Admin. Wants Until Nov. 19 to Object to Claims ASCENDIA BRANDS: Can Access DIP Financing Until December 31 ASPEN DENTAL: S&P Assigns Corporate Credit Rating at 'B' AZUSA WORLD: Files for Chapter 11 Bankruptcy Protection AZUSA WORLD: Case Summary & 14 Largest Unsecured Creditors BARRY COOPER: Case Summary & 20 Largest Unsecured Creditors BISCAYNE HOLDINGS: Case Summary & 2 Largest Unsecured Creditors BLYTH INC: Moody's Downgrades Corporate Family Rating to 'B2' BRIARWOOD CAPITAL: Plan Exclusivity Hearing Continued Until Oct. 4 BRICKELL BAY: Case Summary & 6 Largest Unsecured Creditors C&H ARIZONA: Plan Promises Full Payment for Unsecured Claims CANAL CAPITAL: Posts $229,700 Net Loss in July 31 Quarter CARE FOUNDATION: Plan of Reorganization Wins Court Approval CHABAD-LUBAVITCH: Stonegate Wants to Proceed with Foreclosure CHARLES BUTLER: Case Summary & 20 Largest Unsecured Creditors CHC HELICOPTER: Moody's Assigns 'B1' Rating on $1.1-Bil. Notes CHC HELICOPTER: S&P Assigns 'B+' Long-Term Corp. Credit Rating CHEMTURA CORP: A&M Submits First Report on Chemtura Canada CHEMTURA CORP: Wins Nod of Chartis Buyback Agreement CHEMTURA CORP: Wins Nod of Florida Environmental Settlement CIRTECH, INC.: Case Summary & 20 Largest Unsecured Creditors CLAIM JUMPER: Organizational Meeting to Form Panel on Sept. 22 COAST INDEX: Case Summary & 20 Largest Unsecured Creditors CONTECH CONSTRUCTION: S&P Junks Corporate Credit Rating From 'B-' CORINTHIAN COURT: Case Summary & Largest Unsecured Creditor DANIELLE THOMPSON: Case Summary & 20 Largest Unsecured Creditors DIPAK DESAI: Committee Can Hire Kolesar & Leatham as Local Counsel DOT VN: Posts $1.96 Million Net Loss in July 31 Quarter EAST WEST RESORT: Submits Plan of Liquidation EDGEN MURRAY: S&P Downgrades Corporate Credit Rating to 'B-' ENERGAS RESOURCES: Posts $129,200 Net Loss in July 31 Quarter ENERGY TRANSFER: Fitch Assigns 'BB' Rating on $1-Bil. Senior Notes ENERGY TRANSFER: Moody's Affirms 'Ba1' Corporate Family Rating EPIXTAR CORP: Reorganization Case Converted to Chapter 7 EVERTEC INC: S&P Assigns 'B-' Rating on $220-Mil. Senior Notes EXPRESSWAY DEVELOPMENT: Court OKs $8.5-Mil. Sale of Property FAIRVIEW CONSTRUCTION: Case Summary & Creditors List FPD LLC: Gets Court's Interim Nod to Use Cash Collateral FPD LLC: Gets Court's Interim Okay to Sell Homes FRONTIER COMMUNICATIONS: Fitch Puts BB+ Rating on $190-Mil. Notes FTI CONSULTING: S&P Rates $350 Mil. Senior Unsec. Notes at 'BB' GC HOLDINGS: Case Summary & 8 Largest Unsecured Creditors GENERAL GROWTH: Amends Employment Pacts With CEO & COO GENERAL GROWTH: Elk Grove Has New Settlement With H.S. Wright GILL & SURINDER: Case Summary & 16 Largest Unsecured Creditors GOTTSCHALKS INC: Expects Wider Net Loss for July 31 2010 Qtr. GRAPHIC PACKAGING: Fitch Expects to Rate Senior Bonds at 'B/RR4' GRAPHIC PACKAGING: Moody's Assigns 'B3' Rating on $250 Mil. Notes GRAPHIC PACKAGING: S&P Assigns 'B' Rating on $250 Mil. Notes GREENWOOD ESTATES: Can Access Capmark's Cash Until September 30 GREYSTONE LOGISTICS: HoganTaylor LLP Raises Going Concern Doubt HANSEN MEDICAL: Hires Deloitte & Touche as Independent Auditors HANSEN MEDICAL: Posts $10.9 Million Net Loss in June 30 Quarter HEALTHSOUTH CORP: Presents Strategy to Improve Liquidity HELLER EHRMAN: Plan of Liquidation Wins Court Approval HERITAGE STANDARD: Case Summary & 20 Largest Unsecured Creditors HFG 231: Case Summary & 6 Largest Unsecured Creditors HUNTER LAKES: Case Summary & Largest Unsecured Creditor ICONIX BRAND: S&P Affirms Corporate Credit Rating at 'B+' INFINISTAFF LLC: Case Summary & 4 Largest Unsecured Creditors ISLAND ONE: Bay Harbour Interested in Investing JACOBS FINANCIAL: Operating Losses Prompt Going Concern Doubt JEFFRY FORCIER: Case Summary & 14 Largest Unsecured Creditors JENNIFER DERVIS: Voluntary Chapter 11 Case Summary JOHN CAHILL: Case Summary & 13 Largest Unsecured Creditors KEVIN O'KEEFE: Case Summary & 20 Largest Unsecured Creditors KNIGHT STOKES: Case Summary & 15 Largest Unsecured Creditors KNOLOGY INC: Moody's Assigns 'B1' Rating on $770-Mil. Loan KNOLOGY INC: S&P Assigns 'B+' Rating on $770 Mil. Senior Notes KY USA: Case Summary & 20 Largest Unsecured Creditors LEAP WIRELESS: Board Adopts Tax Benefit Preservation Plan LIBERTY TIRE: Moody's Assigns 'B2' Corporate Family Rating LINCOLN LOGS: Customers' Funds Are Not Property of the Estate LINCOLNSHIRE CAMPUS: Promises to Pay Claims from Cash Proceeds LINCOLNSHIRE CAMPUS: U.S. Trustee Amends Resident's Committee LJVH HOLDINGS: S&P Puts 'B' Rating on CreditWatch Developing LODGE AT BIG SKY: Voluntary Chapter 11 Case Summary LUDIVINA NACIONALES: Case Summary & 16 Largest Unsecured Creditors LYM, LLC: Case Summary & 8 Largest Unsecured Creditors MADISYN NORTHEAST: Case Summary & 20 Largest Unsecured Creditors MESA AIR: Asks for Approval of Employee Incentive Plan MESA AIR: Proposes to Enter Into Equipment Lease Agreements MESA AIR: To Assume Memphis-Shelby Airport Agreement MGIC INVESTMENT: S&P Puts 'C' Rating on Junior Subordinated Debt MICHAEL BERNARDINO: Case Summary & 17 Largest Unsecured Creditors MIDWEST THEATRES: Case Summary & 20 Largest Unsecured Creditors MORRIS CLARK: Case Summary & 20 Largest Unsecured Creditors MOVING SOLUTIONS: Case Summary & 4 Largest Unsecured Creditors NEXAIRA WIRELESS: Posts $1.1MM Net Loss in October 31 Quarter NEXCEN BRANDS: Files Cert. of Dissolution in State of Delaware NORM NOVITSKY: Case Summary & 11 Largest Unsecured Creditors OAKHURST REALTY: Case Summary & Largest Unsecured Creditor OAKVIEW HOMES: Case Summary & 8 Largest Unsecured Creditors ODYSSEY PROPERTIES: Files Schedules of Assets and Liabilities OSHKOSH CORP: S&P Assigns 'BB+' Rating on $1.2-Bil. Senior Loan OSMOTICS CORPORATION: Case Summary & Creditors List P & K U.S.A.: Case Summary & 16 Largest Unsecured Creditors PACIFIC RIM: Posts $1.2 Million Net Loss in July 31 Quarter PALISADES MEDICAL: Moody's Keeps 'Ba2' Rating on $39.3-Mil. Bonds PEBBLE PAGE: Voluntary Chapter 11 Case Summary R. JONATHAN KAPLAN: Case Summary & 20 Largest Unsecured Creditors RIVIERA MARINE: Hearing on Chapter 15 Petition on October 8 RM STONEGATE: Case Summary & 4 Largest Unsecured Creditors RMAA REAL ESTATE: Involuntary Chapter 11 Case Summary ROBERT GRIFFIN: 10 Affiliates' Chapter 11 Case Summary ROBINO-BAY COURT: Taps Ciardi to Handle Reorganization Case ROBINO-BAY COURT: U.S. Trustee Unable to Form Creditors Committee SCHUTT SPORTS: Riddell Inc. Wants to Pursue Lawsuit SCHUTT SPORTS: DIP Financing, Cash Collateral Use Gets Interim Nod SONOMA VINEYARDS: Court Extends Filing of Schedules Until Oct. 4 SONOMA VINEYARD: Section 341(a) Meeting Scheduled for Oct. 1 SOUTH TAHOE: Case Summary & 20 Largest Unsecured Creditors STATES INDUSTRIES: Taps Ball Janik as Bankruptcy Counsel STATES INDUSTRIES: Wants to Hire Inverness as Financial Advisor STONEGATE SUNDANCE: Case Summary & 10 Largest Unsecured Creditors SWIFT TRANSPORTATION: Moody's Affirms 'Caa1' Corp. Family Rating TRADE SECRET: Blocks Bid to Remove CEO, Wins Sale Approval TRUVO USA: To Explore Settlement with Creditors by Oct. 4 UNIGENE LAB: Shows New Strategy & Corporate Realignment UNIVERSAL HEALTH: Fitch Assigns 'B+' Rating on $250-Mil. Notes USG CORP: Contributes 3.2-Mil. Shares to Retirement Plan Trust VICTOR VALLEY: Case Summary & 20 Largest Unsecured Creditors VILLAGE GREEN: Rents Not Assigned Are Property of the Estate VP WAREHOUSING: Case Summary & 7 Largest Unsecured Creditors WARREN JOHNSON: Case Summary & 4 Largest Unsecured Creditors WEST CORPORATION: Plans to Amend Senior Sec. Credit Facilities WEST CORP: Moody's Assigns 'Ba3' Rating on $500-Mil. Loan WEST CORP: S&P Assigns 'B' Rating on $500-Mil. Senior Notes WIEN BAKERY: Case Summary & 8 Largest Unsecured Creditors WILLIAM RAMAGE: Case Summary & 19 Largest Unsecured Creditors WYNDHAM WORLDWIDE: Moody's Gives Pos. Outlook; Puts 'Ba1' Rating YASMIN KASHANI: Case Summary & 20 Largest Unsecured Creditors * August Bankruptcy Filings By Multi-Million Dollar Companies * BOOK REVIEW: CORPORATE DEBT CAPACITY - A Study of Corporate Debt Policy and the Determination of Corporate Debt Capacity, A Business Classic ********* 6620 HAZELTINE: Case Summary & 14 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: 6620 Hazeltine Property, LLC 7349 Suva Street, #24 Downey, CA 90240 Bankruptcy Case No.: 10-49362 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Debtor's Counsel: Michael Jay Berger, Esq. 9454 Wilshire Boulevard, 6th Floor Beverly Hills, CA 90212-2929 Tel: (310) 271-6223 Fax: (310) 271-9805 E-mail: michael.berger@bankruptcypower.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 14 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cacb10-49362.pdf The petition was signed by Soheil Naimi, managing member. A & M GLOBAL: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: A & M Global, LLC 4370 Lajolla Village Drive, Suite 650 San Diego, CA 92122 Bankruptcy Case No.: 10-07982 Chapter 11 Petition Date: September 13, 2010 Court: United States Bankruptcy Court Middle District of Florida (Jacksonville) Debtor's Counsel: Jason A Burgess, Esq. THE LAW OFFICES OF JASON A. BURGESS, LLC 2350 Park Street Jacksonville, FL 32204 Tel: (904) 521-9868 E-mail: jason@cwbfl.com Scheduled Assets: $4,021,000 Scheduled Debts: $898,629 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Marc Mirbod, managing member. ALERE INC: S&P Assigns 'B-' Rating on $350 Mil. Senior Notes ------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'B-' subordinated debt rating to Waltham, Mass.-based Alere Inc.'s $350 million senior subordinated notes due 2018, with a recovery rating of '6', indicating negligible (0%-10%) recovery in the event of payment default. S&P also affirmed its 'B+' corporate credit rating on Alere, and revised its rating outlook stable from positive. "The ratings on Alere reflect the company's appetite for growth through acquisitions, the uncertain prospects of the health management business, and an 'aggressive' financial risk profile," explained Standard & Poor's credit analyst Arthur Wong. Alere's broadening portfolio of professional diagnostic products partially offsets these concerns. Alere's portfolio of offerings is led by its Professional Diagnostics segment (65% of overall revenues). This segment provides a variety of rapid diagnostic tests and equipment for medical professionals for use in hospitals, doctors' offices, and the point-of-care market. The remaining third of Alere's revenues primarily consists of health management services, an area where the company has also grown via acquisitions. The health management business mainly offers patient self-testing services, oncology, and women's and children's health disease management services, which complement Alere's focus on developing rapid diagnostic tests for these therapeutic areas AMBERTON APARTMENTS: Tanglewood St. Petersburg's Case Summary ------------------------------------------------------------- Debtor: Tanglewood St. Petersburg Limited Partnership aka Tanglewood Apartments fka RSG Family Limited Partnership - Tanglewood P.O. Box 990460 Naples, FL 34116 Bankruptcy Case No.: 10-22184 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Scott A. Stichter, Esq. STICHTER, RIEDEL, BLAIN & PROSSER 110 E. Madison Street, Suite 200 Tampa, FL 33602-4700 Tel: (813) 229-0144 Fax: (813) 229-1811 E-mail: sstichter.ecf@srbp.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 eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb10-22184.pdf Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Amberton Apartments, LLC 10-03402 02/18/10 Central Park II, LLC 10-03572 02/19/10 Central Park/Vogue Limited Partnership 10-03566 02/19/10 Lincoln Square Lakeland, LLC 10-8756 04/15/10 Norton Clearwater Limited Partnership 10-10989 05/07/10 Oakwood Palmetto, LLC 10-10980 05/07/10 RSG Family - RiverTree Landing 10-03604 02/19/10 Apartments, LLC RSG Family Limited Partnership Immokalee 10-10987 05/07/10 Terrace Point Apartments I, LLC 10-7946 04/05/10 Terrace Point Apartments II, LLC 10-7947 04/05/10 Terrace Point Apartments III, LLC 10-7949 04/05/10 Woodlawn Apartments, LP 10-10990 05/07/10 The Tanglewood petition was signed by Suzanne and Stephen Glas, co-trustees. ARCHWAY COOKIES: Payments to Supplier Weren't Preferential ---------------------------------------------------------- WestLaw reports that payments by Archway Cookies LLC and Mother's Cake & Cookie Co. to its supplier, Detroit Forming, Inc., were made in the ordinary course of business and, thus, were not avoidable. The supplier was in the business of producing plastic trays for use in the food industry, and the debtors purchased the trays for such use. The parties' business relationship lasted over two years and involved 117 transactions. The transactions made in the historical period were sufficiently similar to those made in the preference period, as there was no evidence that the amounts paid by the debtor during the preference period were inconsistent with their historical practices, all 117 payments were made by check, and the supplier's practices of pressuring the debtors into payment were consistent with their historical dealings. In addition, the 107 transfers that occurred during the historical period were made between 21 and 177 days after the issuance of invoices, with an average days-to-pay of 42.3 days, while the ten transfers made in the preference period ranged from 41 to 64 days after the issuance of invoice, with an average of 47.2 days-to-pay. In re Archway Cookies, --- B.R. ----, 2010 WL 3448549 (Bankr. D. Del.) (Sontchi, J.). A copy of the Honorable Christopher S. Sontchi's Opinion dated Sept. 2, 2010, is available at: http://www.leagle.com/unsecure/page.htm?shortname=inbco20100901601 Based on Judge Sontchi's summary judgment ruling, the estates won't recover $180,648 paid to Detroit Forming prior to the petition date. Detroit Forming is represented by: Stuart A. Lebenbom, Esq. LEBENBOM & ROTHMAN, P.C. 2701 Troy Center Drive, Suite 450 Troy, MI 48084 Telephone: 248-519-1000 - and - Ian Connor Bifferato, Esq. Thomas F. Driscoll, III, Esq. Kevin G. Collins, Esq. BIFFERATO LLC P.O. Box 2165 Wilmington, DE 19899-2165 Telephone: 302-225-7600 Headquartered in Battle Creek, Michigan, Archway Cookies, LLC, -- http://www.archwaycookies.com/-- makes soft-baked cookies. And crackers. In 1998, Specialty Foods Corp. acquired the Debtors' for about $100 million. Parmalat Finanziaria of Italy acquired Mother's Cake and Cookie Company and Archway Cookies from The Specialty Foods Acquisition Corporation for $250 million in 2000. Parmalat later sold its North American Bakery Group, which includes the Archway brands, Mother's brands and the U.S. and Canadian private label cookie businesses, to the private equity firm Catterton Partners and their operating partner Insight Holdings in 2005. Archway Cookies sought Chapter 11 protection (Bankr. D. Del. Case No. 08-12323) on Oct. 6, 2008. Its affiliate, Mother's Cake & Cookie Co. also sought bankruptcy (Bankr. D. Del. Case No. 08-12326). Michael R. Lastowski, Esq., at Duane Morris, LLP, represented the Debtors. In their bankruptcy petitions, the Debtors estimated their assets at $50 million to $100 million and their debts at $500 million and $1 billion. On January 8, 2009, the Court approved the request of the Debtors to convert their Chapter 11 cases to Chapter 7 liquidation proceedings, effective as of January 21, 2009, at 5:00 p.m. Jeoffrey L. Burtch serves as the Chapter 7 Trustee and is represented by Robert W. Pedigo, Esq., and M. Claire McCudden, Esq., at Cooch & Taylor, P.A., in Wilmington, Del. ARTECITY PARK: To Get $2.7 Million Loan from Corus JV ----------------------------------------------------- Brian Bandell at South Florida Business Journal reports that a federal judge approved an agreement between Artecity Management and lender Corus Construction Venture, a joint venture between the Federal Deposit Insurance Corp. and Starwood Capital Group. Artecity owns the partially completed, 202-unit condominium development in Miami Beach. Under the agreement, Corus will lend the Company $2.7 million at 6% interest for the purpose of completing construction of the Company's two condominium towers. The loan is due in one year. Corus owes $45.2 million from the original mortgage, which is subject of a foreclosure lawsuit filed in March 2010. Proceeds from the sale of the remaining 120 condominium units must go to pay what Corus is owed. The developers and officers cannot collect their management fees unless the Corus loan is repaid in full. Miami Beach, Florida-based Artecity Park LLC filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. S.D. Fla. Case No. 10-31410). Thomas R. Lehman, Esq., who has an office in Miami, Florida, assists the Company in its restructuring effort. The Company estimated $50 million to $100 million in assets and $10 million to $50 million in debts in its Chapter 11 petition. Affiliates Artecity Governor LLC, Artecity Holding LTD, and Artecity Management LLC also filed for Chapter 11. ARTURO RUELAS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Arturo Buenrostro Ruelas Gloria Elena Buenrostro 10231 Singleton Road San Jose, CA 95111 Bankruptcy Case No.: 10-59538 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Northern District of California (San Jose) Judge: Charles Novack Debtors' Counsel: Scott J. Sagaria, Esq. LAW OFFICES OF SCOTT J. SAGARIA 333 W. San Carlos Street, #1700 San Jose, CA 95110 Tel: (408) 279-2288 E-mail: sjsagaria@sagarialaw.com Scheduled Assets: $1,181,388 Scheduled Debts: $3,053,436 A list of the Joint Debtors' 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-59538.pdf ASARCO LLC: Court OKs Charter Oak's $3.47 Mil. in Fees & Expenses ----------------------------------------------------------------- U.S. Bankruptcy Judge Richard Schmidt separately awarded five professionals their final fees and expenses in these amounts: Allowed Fees Professional Fee Period and Expenses ------------ ---------- ------------ Charter Oak Financial 06/08/07 to $3,472,626 Consultants, LLC 12/09/09 Legal Analysis 03/10/06 to 1,733,155 Systems, Inc. 12/09/09 David P. Anderson 04/11/05 to 142,673 11/30/09 Jennings Strouss & 10/05/09 to 28,800 Salmon, P.L.C. 12/09/09 The Law Offices of 12/05/07 to 8,989 Dean Baker 12/09/09 Charter Oak served as financial advisors, Mr. Anderson served as insurance advisor, and Jennings Strouss served as special counsel, for the Official Committee of Asbestos Claimants. Dean Baker served as the Asbestos Committee's local Connecticut counsel, while Legal Analysis served as asbestos claims consultant. ASARCO Objects to SBEP's Enhanced Fees ASARCO LLC, Asarco Incorporated and Americas Mining Corporation ask the Court to deny Stutzman, Bromberg, Esserman & Plifka's Fee Enhancement Application in its entirety; deny in part the firm's Final Fee Application and reduce the award by $3,335,784; and deny both SBEP's fee supplements. SBEP served as counsel for the Official Committee of Asbestos Claimants. Confirming and consummating the Parent's full-payment plan was undoubtedly a successful conclusion to the ASARCO bankruptcy proceedings, and each professional should receive fair and reasonable compensation for the part that it played in reaching that successful conclusion, Charles A. Beckham, Jr., Esq., at Haynes and Boone, LLP, in Houston, Texas, avers. SBEP represented to the Court and the Asbestos Committee that it was receiving fair, reasonable, and market-based compensation as reflected in their full standard hourly rates, as unilaterally and regularly increased during the course of the bankruptcy, Mr. Beckham points out. He notes that SBEP made full billing of time worked on the bankruptcy cases with no discounts. Particularly in light of these admissions, Mr. Beckham argues, SBEP's Second Fee Supplement oversteps the boundaries of both fairness and reason. He contends that SBEP is not entitled to fees and expenses incurred in defending its Final Fee Application or its Fee Enhancement Application. SBEP Talks Back SBEP says that through the Second Fee Supplement, it updated certain estimated fees and expenses to include the actual fees and expenses incurred in connection with the defense of its Final Fee Requests for the period from June 21, 2010, through and including July 31, 2010. The estimates in the Second Fee Supplement replace the $90,000 estimate sought in the Esserman Affidavit. The issue of whether SBEP is entitled to receive compensation for the fees and expenses incurred in defending its Final Fee Application was litigated in connection with the hearings on SBEP's Final Fee Requests and thus, ASARCO's objection is unnecessary, Sander L. Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, in Dallas, Texas, tells Judge Schmidt. He points out that ASARCO has admitted that it is obligated to pay the allowed fees and expenses that SBEP, and other professionals, incurred in defending their final fee applications before the Court. "This new position is entirely inconsistent with the position taken by Reorganized ASARCO during the months of hearings on its various fee objections, and Reorganized ASARCO cannot reverse course and now argue that SBEP is not entitled recover the fees and expenses incurred in defending its Final Fee Application," Mr. Esserman argues. Mr. Esserman points out that because ASARCO has already agreed to pay SBEP's allowed fees and expenses associated with defending its Final Fee Application, ASARCO's objection to the payment of those fees should be overruled. He adds that because this issue has already been litigated before the Court, and the Second Fee Supplement merely supplements the fees and expenses requested by SBEP's Final Fee Requests, the Court does not need to set a hearing on the Second Fee Supplement. Barclays Insists on Discretionary Fee Barclays Capital PLC is seeking a $9.2 million "discretionary" fee on top of the $13.6 million ordinary fee it earned for its role as a financial adviser during the bankruptcy case. Janet M. Weiss, Esq., at Gibson, Dunn & Crutcher LLP, in New York -- jweiss@gibsondunn.com -- contends that the Court properly approved Barclays' engagement letter, which provides that Lehman Brothers Inc.'s services should be considered in determining the award of the discretionary fee to Barclays. She argues that Asarco Inc. attempts to deflect attention from its weak position by: -- attacking the Court's final, non-appealable Retention Order; -- making false accusations against Barclays; -- questioning the legitimacy of the transfer by Lehman of its rights under its engagement letters with the Debtors; and -- ignoring the language of the engagement letters. The Parent's attack on the Retention Order is barred by the principles of res judicata and the law of the case, Ms. Weiss contends. She notes that in issuing the Retention Order, the Court overruled the Parent's objection to the retention, and retained Barclays pursuant to the engagement letter. The Parent did not appeal and therefore, the Parent cannot now attack that binding order, she adds, among other things. ASARCO Replies to Barclay's Assertion Barclays' response represents a manifest misunderstanding of the Supplemental Brief, ASARCO and the Parent tell Judge Schmidt. With this reply, ASARCO says it aims to clarify for Barclays and reiterate for the Court the Supplemental Brief's purpose and ASARCO's overarching position as to Barclays' Fee Enhancement Application. "[Barclays] must not have read the eight-page Supplemental Brief before devoting twenty-one pages and two never-before-produced documents to respond," Mr. Beckham argues. "The Supplemental Brief had a very limited purpose -- to address several of BarCap's arguments and theories unveiled for the first time in its proposed Findings of Fact and Conclusions of Law," he explains. Mr. Beckham alleges that in Barclays' Proposed Findings, for the first time, Barclays "explained" its assignment theory -- namely, how Barclays can reap the benefits while discarding the burdens of Lehman Brothers Inc.'s engagement. He contends that the "factual" basis for this assignment theory remains muddled, largely because of Barclays' persistent conflation of the timing of Barclays and Lehman's respective roles and contractual obligations. What is not proper is Barclays' belated attempt to re-open the evidence after trial, closing, and the submission of proposed findings of fact and conclusions of law with never-before- produced documents in a desperate attempt to plug major gaps in Barclays' basic elements of proof, Mr. Beckham says. He insists that the Court should exclude Barclays' late-filed documents; but, even if the Court does not exclude them, Barclays' motion for a fee enhancement should be denied. Status Report on Fee-Related Requests At Judge Richard Schmidt's behest, Reorganized ASARCO LLC, Asarco Incorporated and Americas Mining Corporation filed with the Court a report relating to the various contested fee applications, fee enhancement requests, and substantial contribution motions. ASARCO and the Parent subsequently filed two amended Status Reports. The Status Report provides, among other things, that several of the contested requests have been resolved, while others are still under advisement. A copy of the latest Status Report dated September 3, 2010, can be obtained for free at: http://bankrupt.com/misc/ASARCO_Report_Fees_09032010.pdf About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: Court OKs Transfer of Funds From TCEQ ------------------------------------------------- Project Navigator Ltd., the Custodial Trustee of the Texas Custodial Trust, sought and obtained an order from U.S. Bankruptcy Judge Richard Schmidt instructing the Texas Commission on Environmental Quality to transfer funds received from a settlement of its claim for remediation of residential properties with ASARCO LLC to the Trust's account. Mary W. Koks, Esq., at Munsch Hardt Kopf & Harr, P.C., in Houston, Texas -- mkoks@munsch.com -- relates that the U.S. Environmental Protection Agency and the TCEQ filed proofs of claim in the Debtors' bankruptcy cases for remediation of residential properties in neighborhoods immediately adjacent to ASARCO's El Paso Smelting facility. Pursuant to a settlement of those claims, the TCEQ was awarded $493,289, which is based on 10% of the EPA's approved settlement. Ms. Koks asserts that the funds from the settlement with ASARCO are earmarked for remediation of ASARCO's smelting facilities in El Paso and Amarillo, in Texas. Thus, she says, the funds should be transferred by the TCEQ into the Custodial Trust Account. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: Plan Admin. Wants Until Nov. 19 to Object to Claims --------------------------------------------------------------- Mark A. Roberts of Alvarez and Marsal North America LLC, reorganized Asarco's Plan Administrator, asks the U.S. Bankruptcy Court for the Southern District of Texas to extend the time by which he can file objections to claims pursuant to Section 14.2 of the Confirmed Plan of Reorganization and Rule 9006(b)(1)(1) of the Federal Rules of Bankruptcy Procedure, through and including November 19, 2010. The current Claims Objection Deadline will expire on September 17, 2010. Dion W. Hayes, Esq., at McGuirewoods LLP, in Richmond, Virginia, tells the Court that the Plan Administrator is concerned that unmeritorious claims might be allowed merely by the passage of time. He avers that the requested extension will not prejudice the holders of Disputed Claims because Postpetition Interest continues to accrue and will be paid on the Allowed Amount, if any, of a Disputed Class 3 Claim, if and when it becomes an Allowed Claim. Mr. Hayes assures the Court that the Plan Administrator and Reorganized ASARCO LLC will not use the sought extension to delay payment to claimants, who are appropriately entitled to distributions under the Confirmed Plan. As per the minutes of a September 13, 2010 hearing, the Plan Administrator's extension request "has been agreed to," and an "order to that effect will follow within 10 days." About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASCENDIA BRANDS: Can Access DIP Financing Until December 31 ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware extended, for the thirteenth time, the terms of the Final DIP Financing Order authorizing Ascendia Brands Inc., et al., to obtain postpetition financing from Wells Fargo Foothills, Inc. The Court extended the Debtors' access to the DIP financing to fund their postpetition expenses until December 31, 2010. The terms of the order were negotiated in good faith and at arm's- length among the Debtors, Wells Fargo as DIP agent, and the DIP lenders. As reported in the Troubled Company Reporter on Sept. 11, 2008, Judge Brendan L. Shannon authorized the Debtors to obtain, on a final basis, up to $26,428,000 in postpetition financing, pursuant to a DIP loan agreement dated Aug. 5, 2008. A full-text copy of the Debtors' DIP loan agreement dated Aug. 5, 2008, is available for free at http://ResearchArchives.com/t/s?3083 About Ascendia Brands Headquartered in Hamilton, New Jersey, Ascendia Brands, Inc. -- http://www.ascendiabrands.com/-- was, prior to the sale of substantially all of its assets during bankruptcy, a manufacturer and seller of branded and private labeled health and beauty care products in North America, including Baby Magic, Binaca, Mr. Bubble, Calgon, Ogilvie, the healing garden, Lander and Lander Essentials. Remaining assets consist almost entirely of accounts receivable. The Company and six of its affiliates filed for Chapter 11 protection on August 5, 2008 (Bankr. D. Del. Lead Case No. 08-11787). Kenneth H. Eckstein, Esq., and Robert T. Schmidt, Esq., at Kramer Levin Naftalis & Frankel LLP, represent the Debtors in their restructuring efforts. M. Blake Cleary, Esq., Edward J. Kosmoswki, Esq., and Patrick A. Jackson, Esq., at Young, Conaway, Stargatt & Taylor, LLP, serve as the Debtors' Delaware counsel. Epiq Bankruptcy Solutions LLC is the notice, claims and balloting agent to the Debtors. At July 5, 2008, Ascendia Brands, Inc., had $194,800,000 in total assets and $279,000,000 in total debts. ASPEN DENTAL: S&P Assigns Corporate Credit Rating at 'B' -------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its 'B' corporate credit rating to East Syracuse, New York-based Aspen Dental Management Inc. At the same time, S&P assigned its 'B+' issue-level debt rating to the company's proposed revolving credit facility maturing 2015; a 'B+' issue-level rating to the first-out term loan facility maturing 2016; with both facilities assigned a recovery rating of '2', indicating the prospects for substantial (70%-90%) recovery in the event of payment default. S&P assigned its 'CCC+' issue-level debt rating to the last-out term loan facility maturing 2016 with a recovery rating of '6,' indicating the prospects for negligible (0-10%) recovery in the event of payment default. The rating outlook is stable. "The speculative-grade ratings on Aspen Dental Management Inc. reflect the risks tied to its narrow business focus, rapid growth and high debt leverage," said Standard & Poor's credit analyst Jack Harcourt. Aspen Dental's weak business risk profile reflects its narrow business focus, exclusively in dentistry, its concentration on a specific patient niche, and a business model of uncertain durability as the company expands rapidly over time. Aspen Dental has doubled revenues just in the past several years through de novo expansion, and currently operates 254 locations in 21 states, primarily in the Northeast and Midwest. Through long-term business service agreements, Aspen Dental provides dentists with the opportunity to establish and own their own professional corporations. Aspen Dental provides practice support infrastructure to dental professionals, who seek to focus on the clinical aspects of dentistry, and who want to be relieved of the wide range of commercial responsibilities associated with a running a dental practice. Although the company has grown rapidly from only 13 clinics in 1998, management could be challenged by the complexities associated with recent growth, including an additional 55 de novo projects in 2010. AZUSA WORLD: Files for Chapter 11 Bankruptcy Protection ------------------------------------------------------- Azusa World Ministries, also known as AZUSA World Ministries Community Church filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 10-29299) on September 14, 2010. AZUSA is a non-profit religious corporation. The Debtor estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. Ray Stern at Phoenix NewTimes reports that AZUSA owes commercial real estate firm Greenfield Warner LLC. AZUSA World failed to timely filed a 2010 corporate report. AZUSA WORLD: Case Summary & 14 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Azusa World Ministries aka AZUSA World Ministries Community Church 5109 W Thomas Road Phoenix, AZ 85031 Bankruptcy Case No.: 10-29299 Chapter 11 Petition Date: September 14, 2010 About the Debtor: AZUSA World Ministries is a non-profit religious corporation. Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtor's Counsel: Irena Juras, Esq. JURAS LAW FIRM, PLC 7150 E. Camelback Road, Suite 444 Scottsdale, AZ 85251 Tel: (480) 425-2009 Fax: (480) 452-1640 E-mail: irena@juraslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 14 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb10-29299.pdf The petition was signed by Dr. Alfred Earl Craig, Sr., president. BARRY COOPER: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Joint Debtors: Barry Lee Cooper, Sr. Linda Lee Cooper 14755 Reef Court Jacksonville, FL 32226 Bankruptcy Case No.: 10-07980 Chapter 11 Petition Date: September 13, 2010 Court: United States Bankruptcy Court Middle District of Florida (Jacksonville) Debtor's Counsel: Jason A. Burgess, Esq. THE LAW OFFICES OF JASON A. BURGESS, LLC 2350 Park Street Jacksonville, FL 32204 Tel: (904) 521-9868 E-mail: jason@cwbfl.com Scheduled Assets: $920,270 Scheduled Debts: $1,214,523 A list of the Joint Debtors' 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/flmb10-07980.pdf BISCAYNE HOLDINGS: Case Summary & 2 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Biscayne Holdings 3553, LLC 3553 NW 50 Street Miami, FL 33142 Bankruptcy Case No.: 10-37616 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Southern District of Florida (Miami) Judge: Laurel M. Isicoff Debtor's Counsel: James B. Miller, Esq. 19 W. Flagler Street, #416 Miami, FL 33130 Tel: (305) 374-0200 Fax: (305) 374-0250 E-mail: bkcmiami@gmail.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 2 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flsb10-37616.pdf The petition was signed by Harold Miller, president and chairman. BLYTH INC: Moody's Downgrades Corporate Family Rating to 'B2' ------------------------------------------------------------- Moody's Investors Service downgraded the ratings of Blyth, Inc., including the company's corporate family rating and probability of default rating to B2 from B1. In addition, the rating on Blyth's $100 million senior unsecured notes due November 2013 was downgraded to B3 from B2. The rating outlook is stable. These ratings of Blyth were downgraded (LGD point estimate revised): -- Corporate family rating to B2 from B1, -- Probability of default rating to B2 from B1, and -- $100 million 5.5% Senior Unsecured Notes due November 2013 to B3 (LGD5; 73%) from B2 (LGD5; 74%). The outlook is stable. Ratings Rationale "The downgrade in Blyth's ratings reflects continued material sales declines within the company's PartyLite U.S. and Canadian business due to a deteriorating consultant count, lower consultant productivity, lower discretionary spending and increased competition from other direct sellers," says Moody's Vice President and Senior Credit Officer Janice Hofferber. "Furthermore, sales in PartyLite's European business, which has until recently performed relatively well, have come under pressure from economic weakness in the region as well as a significant decline in the growth rate in active representatives," adds Ms. Hofferber. Blyth is facing other significant challenges including a poor housing and job market that has affected sales of more discretionary purchases of home d�cor and giftware sales, as well as the secular decline of catalog circulation. Blyth's B2 rating reflects the competitive nature of the company's direct selling candle business in the U.S. and Canada, recently weakened growth prospects in maturing European markets, and the highly discretionary nature of the majority of its home expressions products that are sold through catalog and internet channels of distribution. Modest leverage, a strong cash position and minimal near-term debt maturities help to offset these risks. Nevertheless, Moody's expects that consumer discretionary spending (even on relatively low priced goods) will remain subdued as the economy recovers slowly and competition for sales consultants will remain intense in its U.S. and Canadian direct selling businesses. While the company's past emphasis on share repurchases and acquisitions has moderated and its dividend policy is now quite conservative, Moody's still expect the company's financial policies to favor shareholders given the large concentration of ownership by the Goergen family. Moody's could downgrade Blyth's ratings if the company's sales continue to deteriorate. Specifically, ratings could be downgraded if Debt-to-EBITDA exceeded 4.5 times and Free Cash Flow-to-Debt deteriorated to single digit levels. The pursuit of a more aggressive financial strategy or significant deterioration in the company's liquidity profile could also result in a downgrade. Moody's could revise the outlook to positive and/or upgrade the company's ratings if sales declines moderate and profitability is sustained in all major geographic markets and product categories. In addition, Blyth would need to maintain appropriate financial policies with respect to share repurchases and acquisitions. Headquartered in Greenwich, Connecticut, Blyth, Inc., designs, manufactures and markets a line of candles and home fragrance products, tabletop heating products, candle accessories and home decor and giftware products under brand names such as PartyLite, Miles Kimball, Colonial Candle, Walter Drake and Sterno. Products are sold through home parties, catalogs, internet and retailers in North America, Europe and Australia. The company's three segments, direct selling, catalog & internet, and wholesale account for approximately 66%, 18%, and 16% of annualized revenues, respectively. Total sales for the last twelve month period ending July 31, 2010 were approximately $926 million. BRIARWOOD CAPITAL: Plan Exclusivity Hearing Continued Until Oct. 4 ------------------------------------------------------------------ The Hon. Peter W. Bowie of the U.S. Bankruptcy Court for the Southern District of California has continued until October 4, 2010, at 11:00 a.m., the hearing to consider Briarwood Capital, LLC's request to extend its exclusive periods. The Debtor asked the Court to extend its exclusive periods to file and solicit acceptances for a proposed Chapter 11 Plan until August 27, 2010, and October 26, respectively. Rancho Santa Fe, California-based Briarwood Capital, LLC, filed for Chapter 11 bankruptcy protection on February 23, 2010 (Bankr. S.D. Calif. Case No. 10-02677). Jeffry A. Davis, Esq., at Mintz Levin Cohn Ferris Glovsky & Popeo, assists the Company in its restructuring effort. In its schedules, the Debtor disclosed $292,798,759 in assets and $18,563,641 in liabilities as of the Petition Date. BRICKELL BAY: Case Summary & 6 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Brickell Bay Entertainment and Development Company 810 Brickell Bay Drive, # 12 Miami, FL 33131 Bankruptcy Case No.: 10-37660 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Southern District of Florida (Miami) Judge: A. Jay Cristol Debtor's Counsel: Michael L. Schuster, Esq. 100 SE 2 Street, 44 Floor Miami, FL 33131 Tel: (305) 349-2300 E-mail: mschuster@gjb-law.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's six largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/flsb10-37660.pdf The petition was signed by Juan Barroso Pino, president and sole shareholder. C&H ARIZONA: Plan Promises Full Payment for Unsecured Claims ------------------------------------------------------------ The Hon. Randolph J. Haines of the U.S. Bankruptcy Court for the District of Arizona will convene a hearing on September 28, 2010, 3:00 p.m., to consider the adequacy of the disclosure statement explaining C&H Arizona-Stucky, LLC's Plan of Reorganization. Objections, if any, are due on September 20. 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 secured claims will be paid in full over a five-year period. General unsecured claims will be paid in full, with interest, in two installments. The first installment of 50% of the principal and all accrued interest will be paid on the Effective Date. The second installment of all remaining principal and all accrued interest will be paid six months after the Effective Date. Administrative convenience claims (claims of $9,000 or less) will be paid in full on the Effective Date. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/C&HARIZONA_DS.pdf About C&H Arizona-Stucky, LLC Walnut Creek, California-based C&H Arizona-Stucky, LLC, is the owner and current operator of a 113,071 square feet retail shopping center located at 15440 North Scottsdale Road, Scottsdale, Arizona. The Company filed for Chapter 11 bankruptcy protection on July 7, 2010 (Bankr. D. Ariz. Case No. 10-21165). Simbro & Stanley, PLC, assists the Debtor in its restructuring effort. The Company disclosed $18,064,966 in assets and $9,167,574 in liabilities as of the Petition Date. CANAL CAPITAL: Posts $229,700 Net Loss in July 31 Quarter --------------------------------------------------------- Canal Capital Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $229,683 on $402,671 of revenue for the three months ended July 31, 2010, compared with a net loss of $258,737 on $569,621 of revenue for the same period ended July 31, 2009. The Company's balance sheet at July 31, 2010, showed $3.27 million in total assets, $3.11 million in total liabilities, and stockholders' equity of $152,069. The Company has suffered recurring losses from operations and is obligated to continue making substantial annual contributions to its defined benefit pension plan. The Company says these factors cast substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6b3b About Canal Capital Port Jefferson Station, N.Y.-based Canal Capital Corporation is engaged in two distinct businesses -- real estate and stockyard operations. Canal's real estate properties are located in Sioux City, Iowa, South St Paul, Minnesota, St Joseph, Missouri, Omaha, Nebraska and Sioux Falls, South Dakota. The properties consist, for the most part, of an Exchange Building (commercial office space), land and structures leased to third parties (rail car repair shops, lumber yards and various other commercial and retail businesses) as well as vacant land available for development or resale. Canal currently operates one central public stockyard located in St. Joseph, Missouri. Canal closed the stockyard it operated in Sioux Falls, South Dakota in December 2009. CARE FOUNDATION: Plan of Reorganization Wins Court Approval ----------------------------------------------------------- The Hon. Keith M. Lundin of the U.S. Bankruptcy Court for the Middle District of Tennessee confirmed Care Foundation of America, Inc., et al.'s Plan of Reorganization, amended for the second time. As reported in the Troubled Company Reporter on June 2, 2010, according to the Disclosure Statement, the Debtors propose to pay, in full, the (a) Class 1 -- Secured Claim of NHI, (b) Class 2 -- Other Secured Claims, (c) Class 3 -- Administrative Convenience Claims, (d) Class 4 -- General Unsecured Claims, (e) Class 5 -- Tort Claims, and (f) Class 6 -- Tenant Claims. The Debtors intend to pay the claims from the sale of the facilities to NHI, cash on hand. The Debtors estimate they will have approximately $43,000,000 in cash as of the effective date of the Plan. A full-text copy of the Disclosure Statement, as amended, is available for free at http://bankrupt.com/misc/CareFoundation_AmendedDS.pdf About Care Foundation of America Based in Nashville, Tennessee, Care Foundation of America, Inc., is a nonprofit corporation. Care Foundation and its affiliates each own certain real estate, improvements, and fixtures in the Tampa Bay, Florida that each one in turn leases to Health Services Management, Inc., and its wholly owned subsidiaries for use as a skilled nurning facility. The facilities are known as Ayers Health & Rehabilitation Center, Brooksville Healthcare Center, Bear Creek Nursing Center, Heather Hill Healthcare Center, Royal Oak Nursing Center, and as Cypress Cove Care Center. The Company and five affiliates filed separate petitions for Chapter 11 relief on December 31, 2008 (Bankr. M.D. Tenn. Lead Case No. 08-12367). David E. Lemke, Esq., at Waller Landsden Dortch & Davis, represents the Debtors as counsel. When the Debtors filed for protection from their creditors, they estimated assets at $50 million and $100 million and debts at $1 million and $10 million. CHABAD-LUBAVITCH: Stonegate Wants to Proceed with Foreclosure ------------------------------------------------------------- Alexander Clough, staff writer at the Palm Beach Posts, reports that Stonegate Bank asked a federal bankruptcy court for authority to proceed with its foreclosure lawsuit against Boynton Beach despite the Chapter 11 bankruptcy filing in June 2010. The bank argued that the bankruptcy filing was done in bad faith and was simply a bid to stall for more time. The bank said it wants to get Boynton's property and assets -- including the congregation's five torahs -- to pay off a delinquent loan. A hearing on the bank's motion is set for Sept. 24, 2010. Chabad-Lubavitch of Boynton Beach and Congregation Chabad Lubavitch of Greater Boynton Beach filed for Chapter 11 bankruptcy protection because it was unable to resolve a loan dispute with its lender Stonegate Bank. The Company disclosed of $9 million and debts of $4.1 million as of the Petition Date. Stonegate Bank loaned in 2007 the Chabad $3.8 million to refinance loans on an existing campus and a vacant parcel purchased for expansion but it never took place. The bank currently has liens on the worship center and vacant parcel next door. Chabad-Lubavitch of Boynton filed a Chapter 11 petition on June 11, 2010 (Bankr. S.D. Fla. Case No. 10-26503). Joel M. Aresty, Esq., in Miami, Florida, serves as bankruptcy counsel. In its schedules, the Debtor disclosed assets of $9,000,000 and debts of $4,149,470. CHARLES BUTLER: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Joint Debtors: Charles Butler aka Chuck Butler Sylvia Butler 635 E. Micheltorena Street Santa Barbara, CA 93103 Bankruptcy Case No.: 10-14713 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Central District of California (Santa Barbara) Judge: Robin Riblet Debtors' Counsel: Debra C. Young, Esq. 610 Anacapa Street Santa Barbara, CA 93101 Tel: (805) 403-2213 Fax: (805) 845-3779 E-mail: DebraCYoung@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Joint Debtors' 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cacb10-14713.pdf CHC HELICOPTER: Moody's Assigns 'B1' Rating on $1.1-Bil. Notes -------------------------------------------------------------- Moody's Investors Service assigned CHC Helicopter S.A.'s proposed $1.1 billion senior secured first lien notes a B1 rating and its $300 million super-senior secured revolving facility a Ba1 rating. CHC Helicopter S.A. is a subsidiary of 6922767 Holding S.a.r.l. Moody's assigned 6922767 Holding S.a.r.l. a B1 Corporate Family Rating. The rating outlook is stable. Assignments: Issuer: 6922767 Holding S.a.r.l. -- Corporate Family Rating, Assigned B1 Issuer: CHC Helicopter S.A. -- Senior Secured Bank Credit Facility, Assigned a range of 05 - LGD1 to Ba1 -- Senior Secured Regular Bond/Debenture, Assigned a range of 47 - LGD3 to B1 Reinstatements: Issuer: 6922767 Holding S.a.r.l. -- Probability of Default Rating, Reinstated to B1 Outlook Actions: Issuer: 6922767 Holding S.a.r.l. -- Outlook, Changed To Stable From Rating Withdrawn Ratings Rationale "The B1 CFR reflects CHC's high leverage, weak debt service coverage and complex corporate structure," said Terry Marshall, Moody's analyst. "However the rating also considers CHC's large globally diversified fleet of heavy and medium helicopters, its longstanding customer relationships and solid contract position." CHC's B1 CFR also incorporates the inherent cyclicality in the oil and gas services sector; the relative concentration in the North Sea; and the fact that the company's long-term contracts contain cancellation clauses, although CHC has rarely experienced customer cancellations. The B1 CFR favorably reflects the three to five year contracts that CHC holds with high rated oil and gas companies in its offshore oil and gas support business, which comprises about 75% of revenue. CHC's smaller search and rescue and emergency medical services businesses have contracts predominately with government entities. Additionally, 57% of CHC's flying revenue was derived from fixed monthly fees in the 2010 fiscal year (ending April 30), a favorable level that significantly covers CHC's fixed costs. CHC finances 65% of its fleet of 275 aircraft with off- balance sheet operating leases and associated asset value guarantees. Moody's considers this debt, adding $1.1 billion to its reported 2010 fiscal year debt. In combination with an unfunded pension obligation of $164 million, CHC's adjusted debt, pro forma for the rated financings, totals approximately $2.4 billion, and debt to adjusted EBITDA a very high 6.3x. Moody's expect leverage to increase slightly this fiscal year as the company acquires new aircraft under operating leases. CHC's pro forma interest coverage as measured by EBIT to interest is a commensurately weak 1.3x. CHC has a complex ownership structure due to the regulatory licensing requirements of certain foreign jurisdictions, primarily in Europe. In these countries, CHC typically holds a minority ownership of the voting share of the local company, with a local partner holding the balance. The local company holds the Air Operator Certificate, but CHC controls the aircraft, which it leases to these entities at market rates. CHC also performs all of the associated aircraft maintenance through its Heli-One Group repair and maintenance operation. Most of the company's revenues are tied to oil and gas production activities and 71% of CHC's revenues in its most recent fiscal quarter were generated under long-term contracts, factors that provide a level of stability and predictability to the company's earnings and cash flows. The outlook for helicopter services demand is currently strong, with major and national oil companies requiring additional medium and heavy helicopters to support their increasing deepwater oil and gas activities. CHC has also recently won a significant Irish SAR contract that will bolster earnings and cash flow over the eight year life of the contract. CHC should have good liquidity in 2010 and 2011. Internally generated cash flow and cash in hand should cover cash taxes and interest, working capital requirements, and planned capex for aircraft purchases over the next 12-15 months (the majority of new aircraft purchases will be made under operating leases). Following the notes issue, the company will have approximately $60 million of cash and full availability under the $300 million revolving facility, which matures in 2015. The revolver has one financial covenant (maximum super senior debt/EBITDA of 2.5x), with which the company should be comfortably in compliance in 2010 and 2011. Using Moody's Loss Given Default methodology, the $300 million revolving facility is rated Ba1, three notches above the CFR due to the significant loss absorption cushion afforded by the $1.1 billion senior secured notes, which are rated B1 and subordinated to the bank lenders though an inter-creditor agreement. The notes mature in 2020. The rating would be considered for upgrade if CHC's Debt to EBITDA and EBIT to Interest improved to the 4 to 4.5x and 2 to 2.5x ranges, respectively, and were considered sustainable at these levels. If CHC's continued fleet expansion results in further increases in leverage the ratings could be downgraded. The ratings could also be downgraded if market conditions weaken while the company has these elevated leverage levels. CHC Helicopter S.A. is registered in Luxemburg and headquartered in Vancouver, British Columbia. It is a significant provider of helicopter services to the offshore exploration and production industry, with operations in over 26 countries. CHC HELICOPTER: S&P Assigns 'B+' Long-Term Corp. Credit Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B+' long- term corporate credit rating to 6922767 Holding S.a.r.l. (CHC Helicopter). The outlook is stable. At the same time, S&P assigned its 'BB' issue-level rating, with a '1' recovery rating, to CHC Helicopter S.A.'s proposed US$300 million super senior revolving credit facility and its 'B+' issue-level rating, with a '4' recovery rating, to its proposed US$1.1 billion first-lien senior secured notes. The '1' recovery rating indicates S&P's expectation of very high (90%-100%) recovery, and the '4' recovery rating indicates S&P's expectation of average (30%-50%) recovery in the event of default. "The ratings on CHC Helicopter reflect what S&P views as the company's reliance on the offshore oil and gas industry, competition within helicopter services to the oil and gas industry, large capital spending requirements, lack of free cash flow, and aggressive leverage," said Standard & Poor's credit analyst Jamie Koutsoukis. "These factors, which S&P believes hamper CHC Helicopter's credit profile, are partially offset by the company's position as the world's largest commercial helicopter services company, strong demand for its services, its geographic diversity, and its comparatively large and modern fleet of medium and heavy helicopters," Ms. Koutsoukis added. CHC Helicopter, which operates more than 265 aircraft in more than 26 countries, is one of the two largest global helicopter services providers. The company offers transportation services, primarily for oil and gas producers and exploration companies, as well as search and rescue activities and emergency medical services, through its global and European operations segments. In addition, its Heli-One segment provides helicopter support services that range from the complete outsourcing of all maintenance activities for helicopter operators to maintenance, repair, and overhaul services, to integrated logistics support, helicopter parts sales and distribution, and other related services, to their own flight operations and third-party operators. The stable outlook reflects S&P's expectation that CHC Helicopter will continue to see strong demand for its helicopter services and sustain its operating performance. The outlook further incorporates S&P's view of the company maintaining its cash flow- to-debt metrics (pro forma the proposed financing) as there is no cushion within the rating for any additional leverage. In addition, S&P believes that CHC Helicopter will achieve incremental cash flow generated by its expanded fleet, which should somewhat offset its elevated debt levels in the next two- to-three years. S&P does not expect, however, that the company's balance sheet will materially improve in the near-to-medium term. If CHC Helicopter's operational performance or financial measures deteriorate such that adjusted debt to EBITDA is more than 7.5x, S&P would likely revise the rating downward. Conversely, a positive rating action would depend on the company's ability to significantly reduce its debt, combined with improvements in free cash flow generation, which S&P believes is unlikely in the near term. CHEMTURA CORP: A&M Submits First Report on Chemtura Canada ---------------------------------------------------------- Alvarez & Marsal Canada, Inc., in its capacity as information officer of Chemtura Canada Co./Cie's proceeding under the Companies' Creditors Arrangement Act, apprised Mr. Justice Morawetz on September 8, 2010, of updates with respect to the Chapter 11 proceedings of Chemtura Canada. Under its first information officer report, A&M disclosed that, among other things: 1. The U.S. Bankruptcy Court for the Southern District of New York approved a settlement and release agreement among Chemtura Corporation, Chemtura Canada and the law firm of Humphrey Farrington & McClain P.C. on September 1, 2010; 2. Chemtura Canada's actual positive net cash flow for the August 2010 period was approximately $4,600,000 as compared to forecast net cash flow of approximately 300,000. The positive variance of net cash flow is primarily attributable to total cash inflows being approximately $2,800,000 higher than forecast as a result of greater than forecast sales and collections from affiliated companies in the United States, and total cash outflows being approximately $1,500,000 below forecast primarily as a result of timing differences in payments to vendors; 3. Chemtura Canada did not incur any short-term borrowings during the Period and has a cash balance of approximately $13,500,000 as of August 31, 2010; and 4. The Debtors filed a supplement to their Chapter 11 Plan of Reorganization on September 2, 2010. The Information Officer's activities to date include, among other things: -- reviewing and monitoring of the materials filed in the Chapter 11 cases and communicating with the Information Officer's legal counsel, Osler Hoskin & Harcourt LLP regarding the Chapter 11 documents; -- reviewing draft materials for Chemtura Canada's CCAA Proceeding; -- preparing for the hearing of the Initial Recognition Order; -- reviewing Chemtura Canada's cash flow forecast and weekly variance reporting; and -- establishing its website and posting copies of CCAA Proceeding documents at: http://www.alvarezmarsal.com/chemturacanada/ A full-text copy of the 1st Information Officer's Report is available for free at http://researcharchives.com/t/s?6b28 About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHEMTURA CORP: Wins Nod of Chartis Buyback Agreement ---------------------------------------------------- Chemtura Corp. and its units received the U.S. Bankruptcy Court for authority to enter into a settlement, release, and buyback agreement with certain insurers referred to as "the Chartis Insurers" and sell portions of certain insurance policies. The Debtors, with the Court's approval, filed a redacted version of the Chartis Agreement, which did not disclose the specific coverage of diacetyl claims that may be asserted against the Debtors in the future. The Chartis Insurers are AIU Insurance Company, American Home Assurance Company, Chartis Specialty Insurance Company, Granite State Insurance Company, Illinois National Insurance Company, The Insurance Company of the State of Pennsylvania, Lexington Insurance Company, and National Union Fire Insurance Company of Pittsburgh, PA, and their parents and subsidiaries. The Chartis Insurers' obligation to provide insurance coverage for diacetyl-related liability is currently the subject of two pending lawsuits. In February 2010, the Chartis Insurers commenced an action against Chemtura Canada Co./Cie. In turn, Chemtura Corp. and Chemtura Canada commenced an action against the Chartis Insurers. Both actions seek a declaration of coverage for diacetyl-related claims. Richard M. Cieri, Esq., at Kirkland & Ellis LLP, in New York, reveals that the Chartis Agreement: -- resolves the coverage litigation pending among Chemtura Corp. and Chemtura Canada and the Chartis Insurers; and -- guarantees access to insurance coverage up to a certain amount to defend and indemnify present and future diacetyl-related claims. The salient terms of the Chartis Agreement are: (a) Coverage Buyback. Chemtura Corp. and Chemtura Canada will sell to the Chartis Insurers all coverage under the policies for diacetyl claims in return for the Chartis Insurers' agreement to pay the total settlement amount. (b) Settlement Effective Date. The Agreement becomes effective on the first business day after the satisfaction of several conditions, including the Parties' execution of the Agreement and the Bankruptcy Court' approval. (c) Payment of the Present Diacetyl Claim Settlement Amount. The Chartis Insurers will pay up to $35,000,000 for the resolution of the Present Diacetyl Claims. Up to $25,000,000 of the Present Diacetyl Claim Settlement Amount will be used to pay directly or reimburse half of the settlement amount under a settlement the Debtors entered into with Humphrey Farrington & McClaim P.C., on behalf of the firm's diacetyl-related clients. In addition, the Chartis Insurers will pay half of the indemnity cost, up to an amount aggregating $10,000,000, of any other Present Diacetyl Claim resolved by settlement or litigation either to Chemtura or directly to the counsel for the holder of the claim. The amounts will be paid within 30 days of receipt of claim notice letters and executed releases. Lastly, the Chartis Insurers will pay half of the defense costs incurred after the execution of the Agreement of any litigated Present Diacetyl Claim. (d) Payment of Future Costs. The Chartis Insurers will pay up to a certain amount of the Debtors' future defense and indemnity costs related to any claim or lawsuit alleging injuries arising out of exposure to butter flavorings containing diacetyl, or a claim for contribution or indemnity. The Chartis Insurers will be allowed to participate in the administration and defense of any Future Diacetyl Claims. All payments for future defense and indemnity costs will not be subject to any deductibles, charge backs, retrospective premium adjustments, or any deductions. (e) Self-Insured Retentions. The Parties agree that the Debtors' payments to resolve the Present Diacetyl Claims -- to the extent the payments meet or exceed $35,000,000, including the portion of its payment into an escrow account that is not reimbursed by the Chartis Insurers under the Agreement, its settlement payments in certain cases, and any applicable unreimbursed defense costs -- will satisfy and exhaust certain self-insured retentions that may be applicable to certain claims under certain Insurance Policies. (f) Releases and Indemnity. In consideration of the promises in the Agreement, the Debtors and the Chartis Insurers fully release, acquit, and forever discharge each other from any and all claims arising from or relating to Diacetyl Claims. (g) Additional Releases. Chemtura Corp. and Chemtura Canada will obtain and deliver to the Chartis Insurers a release from each HFM Diacetyl Claimant, as well as a release from any other individual or corporate holder of a Diacetyl Claim with whom the Debtors settles the individual holder's Present Diacetyl Claim. Furthermore, Chemtura Corp. and Chemtura Canada will obtain and deliver or have delivered to the Chartis Insurers a release from each individual and corporate holder of a Future Diacetyl Claim with whom the Debtors settles the individual Holder's Future Diacetyl Claim and for which the Chartis Insurers directly pays or reimburses Chemtura Corp. and Chemtura Canada for Future Defense Costs. (h) Dismissal of Coverage Actions and Withdrawal of Proofs of Claim. As soon as practicable and no later than 10 business days after the Settlement Effective Date, the Parties will file Stipulated Dismissals in the Coverage Actions dismissing without prejudice and without costs to the other Party all claims and causes of action against the other Party in the Coverage Actions. The Chartis Insurers further agree that the Agreement resolves the Proofs of Claim to the extent they involve or are based on Diacetyl Claims without any further action of the Parties. The Debtors filed a redacted version of the Chartis Agreement. The redacted document does not disclose the specific coverage of diacetyl claims that may be asserted against the Debtors in the future. The Debtors seek the Court's authority to file an unredacted version of the Agreement under seal. "While the Debtors have no objection to disclosure of the settlement amount relating to the Present Diacetyl Claims, both the Chartis Insurers and the Debtors agree that the Future Diacetyl Claims Settlement Amount is highly sensitive, confidential business information," Mr. Cieri tells the Court. He avers that "disclosure of this information may place Chemtura, Chemtura Canada, and the Chartis Insurers at a disadvantage in the context of settlement discussions related to any future diacetyl claims." A copy of the redacted Chartis Agreement is available for free at: http://bankrupt.com/misc/Chemtura_ChartisInsurersBuybackPact.pdf About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHEMTURA CORP: Wins Nod of Florida Environmental Settlement ----------------------------------------------------------- Chemtura Corp. and its units sought and obtained the U.S. Bankruptcy Court's approval of a stipulation and settlement agreement with the Florida Department of Environmental Protection, which resolves all disputes concerning: (a) a "protective" proof of claim filed by the FDEP seeking past and future response and oversight costs of not less than $2,000,000 associated with the remediation of certain locations formerly owned and operated by the Debtors in the state of Florida; and (b) the Debtors' adversary proceeding concerning the dischargeability of certain injunctive obligations with respect to FDEP. The Stipulation provides for the payment of $800,000 by Chemtura Corp. in order to resolve potential liabilities that the Debtors estimate would exceed that amount in return for covenants not to sue and contribution protection by the FDEP. The salient terms of the Stipulation are: (i) Deposit of $200,000 into an escrow account established at the Florida Department of Financial Services, Bureau of Collection Management to fund potential corrective actions at 5414 and 5430 North 56th St., in Tampa, Florida, also known as the SMCP Site; (ii) Within 30 days after the effective date of the Debtors' Chapter 11 plan, but in no event later than May 1, 2011, Chemtura will deposit into the Escrow an additional $600,000, which completes Chemtura's payments to the Escrow and resolves the FDEP Claim with respect to all former locations owned and operated by the Debtors in the State of Florida, including: * 3101 Talleyrand Ave., Jacksonville, Florida also known as the Apex oil Property; * SMCP Site; * 3125 Drane Field Road, Lakeland, Florida; * 3601 Celery Avenue, Sanford, Florida; * 1405 West Olive Street, Lakeland, Florida; * Jones Avenue, Zellwood, Florida; * State Road 574 and Faulkenburg Road, Tampa, Florida; * 1602 West Sugarhouse Road, Belle Glade, FL; and * 612 12th Street, East Jacksonville, Florida; (iii) Upon receipt of the second and final Escrow deposit, the FDEP will issue a covenant not to sue the Debtors with regard to any Florida Environmental Laws with respect to the Florida Sites; (iv) If the current owners of the SMCP Site asks for the assignment of a rehabilitation agreement known as the Brownfield Site Rehabilitation Agreement prior to the Plan Effective Date, the Debtors will assign the BSRA to the current owner(s) of the SMCP Site without consideration. The FDEP stipulates that there will be no cure costs required to be paid by the Debtors in connection with assumption of the BSRA. If no assignment request is made, the BSRA will be deemed terminated as of the Plan Effective Date, and the FDEP agrees that no damages will be owing from the deemed termination; (v) The Debtors' adversary proceeding against certain government environmental protection agencies will be dismissed against the FDEP, and the Debtors will not seek a declaration with regard to their obligations to remediate the Florida Sites. Neither the Debtors nor the FDEP will seek or be entitled to any costs or fees related to the Environmental Declaratory Action; (vi) In consideration of all of the distributions that will be made pursuant to the terms of the Stipulation, the FDEP will covenant not to file a civil action or to take any administrative or other action against the Debtors pursuant to any Florida Environmental Law, CERCLA, or any other applicable federal law or regulation with regard to the Florida Sites. About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CIRTECH, INC.: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Cirtech, Inc. 230 E. Emerson Avenue Orange, CA 92865 Bankruptcy Case No.: 10-22855 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Central District of California (Santa Ana) Judge: Theodor Albert Debtor's Counsel: Richard L. Barnett, Esq. 5450 Trabuco Road Irvine, CA 92620 Tel: (949) 261-9700 E-mail: rick@barnettrubin.com Scheduled Assets: $601,580 Scheduled Debts: $1,339,268 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-22855.pdf The petition was signed by Brad Reese, president. CLAIM JUMPER: Organizational Meeting to Form Panel on Sept. 22 -------------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting on September 22, 2010, at 11:00 a.m. in the bankruptcy case of Claim Jumper Restaurants, LLC, et al. The meeting will be held at J. Caleb Boggs Federal Building, 844 King Street, Room 2112, Wilmington, DE 19801. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Inspired by California's Gold Rush history, Claim Jumper Restaurants -- http://www.claimjumper.com-- opened its first location in Los Alamitos, California in 1977. The casual dining concept is an established family favorite, operating 45 restaurants throughout the West Coast and parts of the Midwest. With a modern twist on traditional American cuisine and a full- service saloon, the chain's extensive menu offers a wide variety of food and beverage choices using only the finest, freshest ingredients available. Claim Jumper Restaurants accept reservations and are open daily for lunch and dinner. Claim Jumper Restaurants, LLC, filed for Chapter 11 protection on September 10, 2010 (Bankr. D. Del. Case No. 10-12819). Affiliate Claim Jumper Management, LLC, also sought bankruptcy protection. Curtis A. Hehn, Esq., James E. O'Neill, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel for the Debtors. Attorneys at Milbank, Tweed, Hadley & McCloy LLP are the general bankruptcy counsel. Piper Jaffray & Co. is the financial advisor, and Kurtzman Carson Consultants LLC is the claims and noticing agent. Claim Jumper Restaurants estimated assets of $50 million to $100 million and debts of $100 million to $500 million in its Chapter 11 petition. COAST INDEX: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Coast Index Company, Inc. 850 Lawrence Drive Newbury Park, CA 91320 Bankruptcy Case No.: 10-21442 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Central District of California (San Fernando Valley) Judge: Maureen Tighe Debtor's Counsel: Steven R. Fox, Esq. 17835 Ventura Boulevard, Suite 306 Encino, CA 91316 Tel: (818) 774-3545 Fax: (818) 774-3707 E-mail: emails@foxlaw.com Scheduled Assets: $997,865 Scheduled Debts: $1,285,200 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-21442.pdf The petition was signed by Graham Rice, president. CONTECH CONSTRUCTION: S&P Junks Corporate Credit Rating From 'B-' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Contech Construction Products Inc., including the corporate credit rating to 'CCC' from 'B-'. All ratings remain on CreditWatch, where they were placed with negative implications on June 18, 2010. "The downgrade and CreditWatch status reflects S&P's assessment that continued challenging levels of commercial construction activity and lower-than-expected residential construction activity are likely to continue to constrain Contech's operating results in the near term," said Standard & Poor's credit analyst Thomas Nadramia. In S&P's view, the weak operating environment has decreased the likelihood that Contech will be in a position to remain in compliance with its senior secured bank credit facilities, likely necessitating the need to seek amendments or waivers of its covenant requirements and possibly pursue further restructuring of its debt obligations. The company faced more restrictive bank credit agreement covenants which stepped down on June 30, 2010. In resolving the CreditWatch listing, S&P will assess Contech's plans to address potential near- to intermediate-term liquidity constraints caused by the covenant changes given the difficult operating conditions that are likely to continue during this period. CORINTHIAN COURT: Case Summary & Largest Unsecured Creditor ----------------------------------------------------------- Debtor: Corinthian Court, LLC 1300 Griffin Road Greenwood, AR 72936 Bankruptcy Case No.: 10-74837 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Western District of Arkansas (Fort Smith) Debtor's Counsel: Derrick Mark Davidson, Esq. DERRICK DAVIDSON, P.A. 3061 N. Market Avenue, Suite 8 Fayetteville, AR 72703 Tel: (479) 935-4100 Fax: (479) 856-6168 E-mail: derrick@davidsonbusinessattorney.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Robert Griffin, manager. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Robert Griffin and Julia Griffin 10-73471 07/06/10 The Plantation, LLC 10-74742 09/08/10 Oakview Homes, LLC 10-74830 09/14/10 Iron Tree Homes, LLC 10-74832 09/14/10 Fairview Construction Co., LLC 10-74834 09/14/10 The list of unsecured creditors filed together with its petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ O L Development, LLC Advance from $1,467,915 2300 N. Frisco Road Affiliate Yukon, OK 73099 DANIELLE THOMPSON: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Danielle Thompson aka Danielle L Thompson dba Welcome Home Real Estate Network Solstice International Realty Welcome Home Property Management A1 Appraisal Network 4136 Barrett Road Los Angeles, CA 90032 Bankruptcy Case No.: 10-49180 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Victoria S. Kaufman Debtor's Counsel: James R. Selth, Esq. WEINTRAUB & SELTH, APC 12121 Wilshire Boulevard, Suite 1300 Los Angeles, CA 90025 Tel: (310) 207-1494 Fax: (310) 207-0660 E-mail: jim@wsrlaw.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-49180.pdf DIPAK DESAI: Committee Can Hire Kolesar & Leatham as Local Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Nevada authorized the Official Committee of Unsecured Creditors in the Chapter 11 case of Dipak Desai to employ Kolesar & Leatham, CHTD., as its local counsel. To the best of the Committee's knowledge, K&L is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The Committee's local counsel can be reached at: Nile Leatham, Esq. Natalie M. Cox, Esq. Bart K. Larsen, Esq. KOLESAR & LEATHAM, CHTD. 3320 W. Sahara Avenue, Suite 380 Las Vegas, NV 89102 Tel: (702) 362-7800 Fax: (702) 362-9472 E-mail: blarsen@klnevada.com ncox@klnevada.com The counsel for the committee can be reached at: David J. Molton, Esq. Howard S. Steel, Esq. BROWN RUDNICK LLP Seven Times Square New York, NY 10036 Tel: (212) 209-4800 Fax: (212) 209-4801 E-mail: dmolton@brownrudnick.com hsteel@brownrudnick.com About Dipak Desai Las Vegas, Nevada-based Dipak Desai, aka Dipak Desai, M.D., Chartered, filed for Chapter 11 bankruptcy protection on February 26, 2010 (Bankr. D. Nev. Case No. 10-13050). Bruce Thomas Beesley, Esq., at Lewis And Roca LLP, and Michael F. Lynch, Esq., who has an office in Las Vegas, Nevada, assists the Debtor in its restructuring effort. The Company disclosed $22,324,179 in assets and $1,892,555 in liabilities as of the Petition Date. DOT VN: Posts $1.96 Million Net Loss in July 31 Quarter ------------------------------------------------------- Dot VN Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $1.96 million on $333,508 of revenues for the three months ended July 31, 2010, compared with a net loss of $242,373 on $363,112 of revenues for the same period a year earlier. The Company's balance sheet at July 31, 2010, showed $2.49 million in total assets, $10.10 million in total liabilities, and a stockholders' deficit of $7.62 million. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?6b3d About Dot VN Dot VN, Inc. -- http://www.DotVN.com/-- provides innovative Internet and telecommunication services for Vietnam. The Company was awarded an "exclusive long term contract" by the Vietnamese government to register ".vn" (Vietnam) domains and commercialize Parking Page Marketing/Online Advertising worldwide via the Internet. Also, Dot VN has exclusive rights to distribute and commercialize Micro-Modular Data CentersTM solutions and Gigabit Ethernet Wireless applications to Vietnam and Southeast Asia region. After auditing the Company's 2009 results, Chang G. Park, CPA, expressed substantial doubt about Dot VN Inc.'s ability to continue as a going concern, citing the Company's losses form operations. EAST WEST RESORT: Submits Plan of Liquidation --------------------------------------------- East West Resort Development V, L.P., L.L.L.P., submitted to the U.S. Bankruptcy Court for the District of Delaware a proposed Plan of Liquidation and explanatory Disclosure Statement. The Plan of Reorganization of its debtor-affiliates: NMP Holdings, LLC, Northstar Mountain Properties, LLC, Northstar Iron Horse, LLC, Northstar Big Horn, LLC, Northstar Village Townhomes, LLC, Northstar Trailside Townhomes, LLC, Old Greenwood, LLC, Old Greenwood Realty Inc., Tahoe Mountain Resorts, LLC, and Tahoe Club Company, LLC, was confirmed on June 2, 2010, and became effective on July 1. EWRD V will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the Plan provides for the conversion of all of EWRD V's assets to cash, and the transfer of all assets into the newly formed Liquidating Trust created for the purposes, inter alia, of making distributions to the creditors of the estate, pursuing causes of action, and otherwise completing the liquidation of the estate. Under the Plan, each holder of Class 2 secured claims, if any, will, at the option of the Liquidating Trustee, subject to the consent of the Trust Oversight Committee, (i) receive cash in an amount equal to the claim, in full and complete satisfaction of the claim, on the later of the initial distribution date under the Plan and the date the claim becomes an Allowed Claim, or as soon thereafter as is practicable; or (ii) receive the collateral securing its claim in full and complete satisfaction of the claim. The Liquidating Trustee will distribute to each holder of an Allowed Class 3 General Unsecured Claims a pro rata share of distributable cash. Holders of Interests and Interest Related Claims in Class 4 will receive no distribution or dividend on account of the interests. On the Effective Date, all Interests and Interest Related Claims in Class 4 will be deemed canceled, null and void, and of no force and effect. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/EastWestResort_DS.pdf The Debtor is represented by: Daniel J. DeFranceschi, Esq. Paul N. Heath, Esq. L. Katherine Good, Esq. RICHARDS, LAYTON & FINGER, P.A. One Rodney Square 920 North King Street Wilmington, DE 19801 Tel: (302) 651-7700 Fax: (302) 651-7701 Richard A. Chesley, Esq. Gregory S. Otsuka, Esq. PAUL, HASTINGS, JANOFSKY & WALKER LLP Hilla Uribe Jimenez, Esq. 191 North Wacker Drive, 30th Floor Chicago, IL 60606 Tel: (312) 499-6000 Fax: (312) 499-6100 About East West Resort Avon, Colorado-based East West Resort Development V, L.P., L.L.L.P., is a limited partnership between Crescent Resort Development, Inc., and long-standing developer East West Partners, Inc., that was formed to develop residential and commercial real estate projects on and around the Northstar at Tahoe Resort in Lake Tahoe, California. East West Resort filed for Chapter 11 bankruptcy protection on February 16, 2010 (Bankr. D. Del. Case No. 10-10452), estimating its assets and debts at $100 million to $500 million. The Company's affiliates -- Tahoe Club Company, LLC Tahoe Club Company, LLC; Tahoe Mountain Resorts, LLC; NMP Holdings, LLC; Grays Station, LLC; Old Greenwood, LLC; Old Greenwood Realty, Inc.; Northstar Village Townhomes, LLC; Northstar Big Horn, LLC; Northstar Trailside Townhomes, LLC; Northstar Iron Horse, LLC; and Northstar Mountain Properties, LLC -- filed separate Chapter 11 petitions. The Debtors' financial advisor is Houlihan Lokey Howard & Zukin Capital, Inc. The Debtors' claims agent is Epiq Bankruptcy Solutions. EDGEN MURRAY: S&P Downgrades Corporate Credit Rating to 'B-' ------------------------------------------------------------ Standard & Poor's Ratings Services said that it lowered its corporate credit rating on Edgen Murray II L.P. to 'B-' from 'B'. The rating outlook is stable. At the same time, the issue-level rating on the company's $465 million senior secured notes was lowered to 'B-' (same as the corporate credit rating) from 'B'. The recovery rating remains unchanged at '4', indicating S&P's expectation of average (30% to 50%) recovery in the event of a payment default. "The downgrade reflects S&P's expectation that 2010 EBITDA will likely be around $30 million, materially lower than its previous expectation of about $55 million, due to ongoing weakness in the company's Western Hemisphere segment as a result of lower capital spending on projects in the region," said Standard & Poor's credit analyst Sherwin Brandford. In addition, the industry seems to have become more competitive, perhaps because of the entrance of new smaller competitors during the boom period of 2007 to 2008, resulting in a slower recovery of volumes and margins compared to historical levels. As a result, S&P expects adjusted debt leverage to climb to around 16x and funds from operations to debt to decline to below zero by year- end, levels S&P would consider to be more consistent with a lower rating. ENERGAS RESOURCES: Posts $129,200 Net Loss in July 31 Quarter ------------------------------------------------------------- Energas Resources Inc. files its quarterly report on Form 10-Q, a net loss of $129,243 on $42,922 of total revenues for the three months ended July 31, 2010, compared with a net loss of $160,175 on $36,583 of total revenues for the same period a year ago. The Company's balance sheet at July 31, 2010, showed $7.51 million in total assets, $1.14 million in total liabilities, and $6.36 million in stockholders' equity. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?6b3a About Energas Resources Based in Oklahoma City, Oklahoma, Energas Resources Inc. (OTC BB: EGSR) -- http://www.energasresources.com/-- is primarily engaged in the operation, development, production, exploration and acquisition of petroleum and natural gas properties in the United States through its wholly-owned subsidiary, A.T. Gas Gathering Systems Inc. In addition, the company owns and operates natural gas gathering systems located in Oklahoma, which serve wells operated by the company for delivery to a mainline transmission system. The majority of the company's operations are maintained and occur through A.T. Gas. Smith, Carney & Co. P.C. has expressed substantial doubt against Energas Resources Inc.'s ability as a going concern after auditing the Company's results for the fiscal year ended January 31, 2010. In its Form 10-K filed with the U.S. Securities and Exchange Commission, the Company reported a net loss of $1.9 million on $165,794 of total revenue for the year ended Jan. 21, 2010, compared with a net loss of $2.4 million on $284,297 total revenue during the same period a year ago. ENERGY TRANSFER: Fitch Assigns 'BB' Rating on $1-Bil. Senior Notes ------------------------------------------------------------------ Fitch Ratings has assigned a 'BB' rating to Energy Transfer Equity, L.P.'s offering of $1 billion senior notes due 2020. Note proceeds will be used to repay all borrowings outstanding under its existing $500 million secured revolving credit facility, repay a portion of its $1.45 billion secured term loan due November 2012 (Term Loan B) and related interest swap breakage costs, and to pay transaction fees and expenses. Fitch also assigns a 'BB' rating to ETE's $200 million five-year secured revolving credit facility maturing in September 2015 (the New Revolver) which will close contemporaneously with the retirement of the existing revolving credit facility. The Rating Outlook is Stable. ETE owns approximately 50.2 million Energy Transfer Partners, L.P. (rated 'BBB-' with a Stable Outlook by Fitch) limited partner units, a 1.8% general partner interest in ETP, and all of the incentive distribution rights relating to ETP and approximately 26.3 million Regency Energy Partners, LP units, a 2.0% GP interest in RGNC, and all incentive distribution rights relating to RGNC. ETE's cash flow relies entirely on distributions from ETP and RGNC. Key factors driving the rating are ETP's and RGNC's credit profiles and parent-level debt leverage. The notes initially will be secured equally and ratably with loans under the New Revolver and the Term Loan B by a first-priority interest by all tangible and intangible assets of ETE, including the LP and GP interests in ETP and RGNC that it owns. Once the Term Loan B is repaid in full, the notes will no longer be secured by the collateral and will be unsecured obligations of ETE and will rank junior to the secured New Revolver as to collateral. The notes contain restrictions on the creation of future liens to secure debt following the release of collateral, except under certain limited circumstances or unless all outstanding senior notes are equally and ratably secured with any new secured debt (known as the Negative Pledge). ETE's ratings and Stable Rating Outlook are primarily dependent on the financial and operating characteristics of ETP, to a lesser extent RGNC, the standalone credit profile of ETE, and the favorable recovery prospects for its creditors. Fitch considers ETE's adjusted 2010 debt-to-EBITDA of 3.1 times, as estimated by Fitch, as strong for a master limited partnership holding company structure and should not present an inordinate amount of risk given the quality of its cash flow stream. Pro forma for the senior note financing, leverage and interest coverage ratios should temporarily weaken due to an increase in total debt outstanding of approximately $116 million to cover swap breakage fees and other issuance costs. Over the longer term, ETP's and RGNC's upstream partner distributions should increase as several expansion projects and acquisitions generate distributable cash flow. As a result, ETE's cash flow ratios will strengthen. In addition, the debt repayment funded by the senior note issuance lowers the refinancing risk associated with the revolving credit facility and Term Loan B and lengthens ETE's debt maturity schedule. ENERGY TRANSFER: Moody's Affirms 'Ba1' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service affirmed the Ba1 Corporate Family Rating of Energy Transfer Equity, L.P. and assigned a rating of Ba2 (LGD 6, 92%) to its proposed $1 billion senior note issue. Moody's also affirmed the Ba1 Probability of Default rating, and the Ba2 (LGD 6, 92%) ratings on ETE's $500 million guaranteed senior secured revolving credit facility and $1.45 billion senior secured Term Loan B facility. The rating outlook is negative. Assignments: Issuer: Energy Transfer Equity, L.P. -- Senior Secured Bank Credit Facility, Assigned 92 - LGD6 to Ba2 -- Senior Unsecured Regular Bond/Debenture, Assigned 92 - LGD6 to Ba2 Ratings Rationale "Moody's view the refinancing as largely leverage and credit neutral for the Energy Transfer family, with some reduced liquidity risk," said Tom Coleman, Senior Vice President. ETE will use the senior note proceeds to pay off its $500 million revolving credit facility and a portion of its Term Loan B facility, which currently has $1.45 billion outstanding. ETE will then enter into a new $200 million revolver that matures in September 2015. Proceeds will also be applied to swap breakage costs and other fees. The ratings reflect the transaction's relatively neutral leverage impact on ETE as well as its enhanced liquidity profile. The new debt issuance will modestly increase ETE's debt, resulting in a standalone Debt/EBITDA of 2.8x for ETE in 2010 (including Moody's adjustments) and Total Debt/EBITDA of about 5.4x for the Energy Transfer consolidated family. From a liquidity perspective, the new $200 million revolver should remain largely undrawn. The paydown of the revolving facility and a portion of the Term Loan B will spread out ETE's debt maturities and push out refinancing risk on the revolver from 2011 to 2015. However, the eventual payoff of the Term Loan B will fix the bulk of ETE's liability structure as senior long-term debt, which could limit its ability to reduce standalone leverage in the future. ETE depends directly on cash flows from its direct and indirect interests in Energy Transfer Partners L.P. (Baa3 senior, with stable outlook) and Regency Energy Partners L.P. (Ba3 positive outlook) to meet its debt service obligations and distributions. ETP contributes the bulk of ETE's consolidated earnings and cash flow, as well as its distributions, and its Baa3 long-term rating underpins ETE's Ba1 CFR. ETP's trend of growing distributions and ability to issue new common units have resulted in increasing cash flow support for ETE's debt and unit distributions. While ETP's Baa3 rating reflects its position as one of the largest diversified mid-stream MLPs, it is also constrained by elevated leverage associated with a sizable capital spending program, including investments in large interstate pipelines, and by the high distribution payout inherent in the MLP growth model. RGNC likewise provides diversification and fee-based cash flow within ETE's consolidated operations, but also contributes to ETE's leverage and structural complexity. Stabilization of ETE's negative rating outlook will depend on the ability of both MLPs to continue to access a balance of new equity and debt to fund their growth, which is key to their credit ratings and to ETE's ability to moderate consolidated financial leverage. Timely execution and cash flow growth from major projects such as the Fayetteville Express and Tiger Pipelines could also support a stable outlook. The Ba2 (LGD 6, 92%) ratings reflect application of LGD methodology to the consolidated ETE family, with the revolver, Term Loan B and senior notes notched down from the Ba1 CFR to reflect their subordination to sizable direct claims against ETP and RGNC. ETE debt holders are structurally subordinated to the MLP creditors and effectively equal to the common unit holders in the event of an MLP bankruptcy. In addition, Moody's notes that ETE's senior notes will be secured by ETE's equity in the two MLPs and will rank pari passu with the revolver and Term Loan B as long as the latter remains outstanding. When the term loan is fully paid off, security for the senior notes will fall away. Moody's would not expect the payoff of the Term Loan B to affect notching of the senior notes when the collateral is lifted. The last rating action affecting ETE occurred on May 12, 2010, when Moody's affirmed ETE's ratings and changed the outlook to negative. Energy Transfer Equity, L.P., Energy Transfer Partners, L.P., and Regency Energy Partners L.P. are all headquartered in Dallas, Texas. EPIXTAR CORP: Reorganization Case Converted to Chapter 7 -------------------------------------------------------- The Hon. A. Jay Cristol of the U.S. Bankruptcy Court for the Southern District of Florida converted the Chapter 11 case of Epixtar Corp., et al., to one under Chapter 7 of the Bankruptcy Code. The U.S. Trustee for Region 21, asked the Court to convert the Debtors' 11 case, or in the alternative, appoint a Chapter 11 trustee. Based in Miami, Florida, Epixtar Corp. fdba Global Assets Holding Inc. -- http://www.epixtar.com/-- acquires or establishes companies specialized in mass-market communication products. Epixtar operates through its subsidiaries, National Online Services Inc. and One World Public. The Company and its affiliates filed for Chapter 11 protection on October 6, 2005 (Bank. S.D. Fla. Case No. 05-42040). Michael D. Seese, Esq., at Hinshaw & Culbertson, LLP, and Eyal Berger, Esq., at Kluger, Peretz, Kaplan and Berlin, P.L., represented the Debtors in their restructuring efforts. Carlos E. Sardi, Esq., Glenn D. Moses, Esq., and Paul J. Battista, Esq., at Genovese Joblove & Battista, P.A., represented the official committee of unsecured creditors as counsel. The Debtors disclosed $30,376,521 in assets and debts at $39,158,724 as of the Petition Date. EVERTEC INC: S&P Assigns 'B-' Rating on $220-Mil. Senior Notes -------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'B-' senior unsecured rating to Puerto Rico-based EVERTEC Inc.'s $220 million notes due 2017, with a preliminary recovery rating of '6', indicating S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. "The rating on EVERTEC," said Standard & Poor's credit analyst Molly Toll-Reed, "reflects the company's narrow market profile, leveraged financial profile, and S&P's view that the its ownership structure is likely to preclude sustained deleveraging." S&P expects the company to maintain its "aggressive" financial risk profile, with pro forma adjusted leverage in the low-5x area and funds from operations to total debt of about 10%. S&P expects near-term leverage improvement to be modest, primarily reflecting EBITDA growth. The new note issue does not affect the 'B+' long-term corporate credit rating and stable outlook on EVERTEC, which remain unchanged. S&P expects the company to use the proceeds of the notes to fund a portion of the carve-out acquisition of EVERTEC from a subsidiary of Popular Inc. (B/Positive/C). Ratings List EVERTEC Inc. Corporate Credit Rating B+/Stable/-- Ratings Assigned EVERTEC Inc. Senior Unsecured $220 million notes due 2017 B- (Prelim) Recovery Rating 6 (Prelim) EXPRESSWAY DEVELOPMENT: Court OKs $8.5-Mil. Sale of Property ------------------------------------------------------------ The Hon. Niles Jackson of the U.S. Bankruptcy Court for the Western District of Oklahoma authorized Expressway Development, LLC, to sell the real property of the estate to Tapp Development or its assignee/designee for $8,499,750. The sale will be free and clear of all liens, claims and encumbrances. Proceeds from the sale will be utilized for: 1) payment at closing directly to Union Bank in the amount necessary to pay in full the Union Bank Balance; 2) payment at closing directly to SpiritBank in the amount necessary to pay in full the SpiritBank Balance; 3) payment to unsecured creditors; and 4) payment of all taxes, costs and fees. About Expressway Development Oklahoma City, Oklahoma-based Expressway Development, LLC, filed for Chapter 11 bankruptcy protection on April 9, 2010 (Bankr. W.D. Okla. Case No. 10-12088). Charles E. Wetsel, Esq., at Robertson & Williams, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10 million to $50 million. FAIRVIEW CONSTRUCTION: Case Summary & Creditors List ---------------------------------------------------- Debtor: Fairview Construction Co. LLC 1300 Griffin Road Greenwood, AR 72936 Bankruptcy Case No.: 10-74834 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Western District of Arkansas (Fort Smith) Debtor's Counsel: Derrick Mark Davidson, Esq. DERRICK DAVIDSON, P.A. 3061 N. Market Avenue, Suite 8 Fayetteville, AR 72703 Tel: (479) 935-4100 Fax: (479) 856-6168 E-mail: derrick@davidsonbusinessattorney.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's five largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/arwb10-74834.pdf The petition was signed by Robert Griffin, manager. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Robert Griffin and Julia Griffin 10-73471 07/06/10 The Plantation, LLC 10-74742 09/08/10 Oakview Homes, LLC 10-74830 09/14/10 Iron Tree Homes, LLC 10-74832 09/14/10 FPD LLC: Gets Court's Interim Nod to Use Cash Collateral -------------------------------------------------------- FPD, LLC, et al., sought and obtained interim authorization from the Hon. Paul Mannes of the U.S. Bankruptcy Court for the District of Maryland to use the cash collateral of Wells Fargo Bank, N.A., and Manufacturers & Traders Trust Company through and including October 1, 2010. Prior to the Petition Date, the Debtors were parties to these loans with Wells Fargo, as successor-by-merger to Wachovia Bank, National Association: (i) a $36,200,000 Acquisition and Construction Loan, and Revolving Line of Credit; (ii) an $8,300,000 Revolving Land Acquisition and Development Loan and Promissory Note for the Clearview Meadows project; and (ii) a $6,000,000 Revolving Land Acquisition and Development Loan for the Oak Tree Landing project. As of the Petition Date, the aggregate principal amount outstanding the existing loan documents is at least $27,109,273.80, together with interest costs, fees, expenses, and other charges accrued, accruing or chargeable. Prior to the Petition Date, one or more of the Debtors guaranteed these M&T loans: (i) a $4,000,000 revolving acquisition and development loan; (ii) a $6,900,000 revolving acquisition and development loan; *iii) a $5,500,000 revolving construction loan; (iv) a $604,125 term loan; and (v) a $2,624,000 term loan. As of the Petition Date, the aggregate amount of loans outstanding is $11,486,555.90 in principal, plus $31,136.63 in interest accrued as of the Petition Date, together with costs, fees, expenses and other charges accrued, accruing or chargeable. Irving E. Walker, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., explained that the Debtors need the cash collateral to fund their Chapter 11 case, pay suppliers and other parties. In exchange for using the cash collateral, the Debtors will grant the Lenders replacement liens on present and after-acquired personal and real property of the Debtors. The Lenders will also be granted a superpriority claim. To account adequately for the cash collateral of the Lenders, the Debtors will establish one or more debtors-in-possession accounts at M&T for M&T cash collateral, deposits and disbursements to the Debtors' operating accounts. The Debtors will also establish one or more debtors-in-possession accounts at Wells Fargo for the cash collateral, deposits and disbursements to the Debtors' operating accounts. Proceeds from the sale of any of Wells Fargo's collateral will be deposited into the cash collateral account, and no other funds will be deposited into that account. The Debtors will provide the Lenders with weekly cash flow reports. The Debtors will use the collateral pursuant to a budget. A copy of the budget for use of Wells Fargo's cash collateral is available for free at: http://bankrupt.com/misc/FPD_wellsfargo_budget.pdf A copy of the budget for use of M&T's cash collateral is available for free at: http://bankrupt.com/misc/FPD_M&TBank_budget.pdf About FPD Prince Frederick, Maryland-based FPD, LLC, filed for Chapter 11 bankruptcy protection on September 3, 2010 (Bankr. D. Md. Case No. 10-30424). G. David Dean, II, Esq., and Irving Edward Walker, Esq., at Cole Schotz Meisel Forman & Leonard P.A., assist the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $1 million to $10 million. Affiliates Acorn Land, LLC (Bankr. D. Md. Case No. 10-30437), Breezewood Homes, LLC (Bankr. D. Md. Case No. 10-30441), First Development Group, LLC (Bankr. D. Md. Case No. 10-30443), MD Homes, LLC (Bankr. D. Md. Case No. 10-30444), NC Homes, LLC (Bankr. D. Md. Case No. 10-30445), and Tidewater Land, LLC (Bankr. D. Md. Case No. 10-30446) filed separate Chapter 11 petitions in September 2010. Acorn Land, Breezewood Homes, and MD Homes estimated their assets and debts at $1 million to $10 million each. First Development estimated its assets and debts at $10 million to $50 million. The Debtors' bankruptcy cases are jointly administered. FPD LLC: Gets Court's Interim Okay to Sell Homes ------------------------------------------------ FPD, LLC, et al., sought and obtained interim authorization from the Hon. Paul Mannes of the U.S. Bankruptcy Court for the District of Maryland to sell homes free and clear of liens, claims and interests, enter into sale contracts for homes and close on sales of homes postpetition, and to honor existing prepetition contracts for sales of homes. The Debtors currently have approximately 34 residential homes under contract to be constructed (or completed) and sold in Maryland, Delaware, and North Carolina. Over the next 90 days, the Debtors expects to close on most or all of these sales. The purchasers of these homes have each paid significant deposits to be credited to the sale price of the home at closing, and their families are depending on the Debtors to finish the construction and to deliver the homes they purchased within a reasonable period of time. The Debtors are authorized to continue to sell and close upon the sale of residential homes and to apply customer deposits if applicable, without further court order, and to pay all associated expenses at closing, including but not limited to real estate taxes, subject to the Debtors' compliance with the terms of any entered with respect to the Debtors' use of cash collateral. With respect to the closings for homes for which any mechanic's lien is properly filed under applicable state law prior to closing on the homes, the Debtors are authorized to sell and close upon the residential homes free and clear of all liens, claims and encumbrances, including any mechanic's liens, and to apply customer deposits if applicable, without further court order subject to compliance with these protocols: (a) If any person has properly filed a mechanic's lien claim under applicable North Carolina or Maryland law prior to the Petition Date, or under applicable Delaware law prior to closing, the Debtors are authorized to sell the home free and clear of the Filed Mechanic's Lien Claim, provided that: (i) the Debtors and the filed mechanic's lien claim holder agree to the amount to be paid to the holder of the claim at closing; or (ii) the Debtors escrow the amount of the filed mechanic's lien claim subject to further court order; and (b) If any person files or otherwise attempts to perfect a mechanic's lien claim under North Carolina or Maryland law after the Petition Date, the Debtors are authorized to sell the home free and clear of the asserted lien claim, without payment of the claim at closing. No mechanic's lien claimant will have any claim against the Debtors' title insurance agents or underwriters or any purchaser of a home with respect to any asserted mechanic's lien or other claim or interest relating to any property sold pursuant to, and in accordance with, the terms of the interim court order. About FPD Prince Frederick, Maryland-based FPD, LLC, filed for Chapter 11 bankruptcy protection on September 3, 2010 (Bankr. D. Md. Case No. 10-30424). G. David Dean, II, Esq., and Irving Edward Walker, Esq., at Cole Schotz Meisel Forman & Leonard P.A., assist the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $1 million to $10 million. Affiliates Acorn Land, LLC (Bankr. D. Md. Case No. 10-30437), Breezewood Homes, LLC (Bankr. D. Md. Case No. 10-30441), First Development Group, LLC (Bankr. D. Md. Case No. 10-30443), MD Homes, LLC (Bankr. D. Md. Case No. 10-30444), NC Homes, LLC (Bankr. D. Md. Case No. 10-30445), and Tidewater Land, LLC (Bankr. D. Md. Case No. 10-30446) filed separate Chapter 11 petitions in September 2010. Acorn Land, Breezewood Homes, and MD Homes estimated their assets and debts at $1 million to $10 million each. First Development estimated its assets and debts at $10 million to $50 million. The Debtors' bankruptcy cases are jointly administered. FRONTIER COMMUNICATIONS: Fitch Puts BB+ Rating on $190-Mil. Notes ----------------------------------------------------------------- Fitch Ratings has assigned a 'BB+' rating to Frontier Communications Corporation's new $190 million senior unsecured credit facility. The facility was put into place to support Frontier's requirements to post a $190 million letter of credit in West Virginia in connection with certain capital expenditure commitments made to regulators. The commitments were made by Frontier to gain approval in West Virginia of the acquisition of access lines from Verizon Communications, Inc. Frontier's Issuer Default Rating is 'BB+' and the Rating Outlook is Stable. Frontier's 'BB+' IDR reflects the meaningful improvement anticipated in its credit profile following the acquisition of access lines in 14 states from Verizon on July 1, 2010. Fitch anticipates that Frontier's pro forma gross debt to EBITDA (including integration expenses) at year-end 2010 will be in the 3.0 times to 3.1x range -- substantially lower than the 4.3x recorded at year-end 2009 -- due to the delevering effect of the transaction. In addition, Frontier's 25% reduction in its per share common dividend will redirect cash to the expansion of the availability of broadband services in the acquired properties, a key element in the company's plans to reduce access line losses to competitors. The company's ratings also reflect Fitch's view of competition and its effect on Frontier's operations. Frontier's core rural telecommunications operations are facing a slow but relatively stable state of decline due to the continued pressure of competition as well as a sluggish economic recovery. Through cost controls and the marketing of additional services such as high- speed data, Frontier has been mitigating the effect of access line losses to cable operators and wireless providers. In Fitch's view, Frontier's credit metrics have the potential to strengthen over time. A Positive Outlook could result if the company is successful in driving leverage to the mid-2x range, its dividend payout of free cash flow is 55% or less (and sustainable), and the Verizon lines have been successfully integrated. Fitch also believes an improvement in the performance of the former Verizon properties under Frontier's rurally-focused business model would need to be demonstrated. Conversely, a Negative Outlook may result if the company's leverage metrics rise to 3.3x to 3.4x or greater. Frontier has ample liquidity which is derived from its cash balances, free cash flow, and its $750 million revolving credit facility. At June 30, 2010, Frontier had $231 million in cash and, in the last 12-month period ending June 30, 2010, free cash flow was approximately $116 million. Frontier's expectations for 2010 capital spending range from $220 million to $240 million on a stand-alone basis, and an additional $180 million will be spent on integration activities in anticipation of the Verizon line acquisition. The new $190 million credit facility matures Sept. 20, 2011, unless extended until Sept. 20, 2012. The facility has no financial ratio covenants, and other negative covenants are similar to those in its existing facility. In addition to the new credit facility, liquidity is provided by a $750 million senior unsecured credit facility, which will be in place until Jan. 1, 2014. The $750 million facility will be available for general corporate purposes but may not be used to fund dividend payments. The main financial covenant in the revolving credit facility requires the maintenance of a net debt- to-EBITDA level of 4.5x or less during the entire period. Net debt is defined as total debt less cash exceeding $50 million. Frontier has approximately $5 million of debt due in the remainder of 2010, $280 million due in 2011 and $180 million due in 2012. FTI CONSULTING: S&P Rates $350 Mil. Senior Unsec. Notes at 'BB' --------------------------------------------------------------- Standard and Poor's rated FTI Consulting Inc.'s $350 million Senior Unsecured Notes Due 2020 rated at 'BB' (Recovery Rating: 5). U.S. consulting firm FTI has proposed an issuance of $350 million senior unsecured notes due 2020, and plans to use proceeds to retire its existing 7.625% notes due 2013 and for general corporate purposes. S&P is rating the notes 'BB' with a recovery rating of '5', and affirming its 'BB+' corporate credit rating on the company. The stable rating outlook reflects S&P's expectation that FTI will have moderate revenue and EBITDA growth over the intermediate term, and that debt leverage will not exceed 3x on a prolonged basis. GC HOLDINGS: Case Summary & 8 Largest Unsecured Creditors --------------------------------------------------------- Debtor: GC Holdings, Inc. 1220 Page Avenue Fremont, CA 94538 Bankruptcy Case No.: 10-70550 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Northern District of California (Oakland) Judge: Edward D. Jellen Debtor's Counsel: William C. Lewis, Esq. LAW OFFICES OF WILLIAM C. LEWIS 510 Waverly Street Palo Alto, CA 94301 Tel: (650)322-3300 E-mail: ecf@williamclewis.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 eight largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/canb10-70550.pdf The petition was signed by Richard Tompane, president. GENERAL GROWTH: Amends Employment Pacts With CEO & COO ------------------------------------------------------ General Growth Properties, Inc., entered into amended and restated employment agreements with Adam Metz, chief executive officer and Thomas Nolan, president and chief operating officer, in connection with the two officers' roles at GGP for up to a year after the company's emergence from bankruptcy, pursuant to the company's regulatory filing with the U.S. Securities and Exchange Commission dated September 10, 2010. The salient terms of the Agreements are: * The Agreements are effective as of the earlier date of the effective date of the Third Amended Joint Plan of Reorganization and January 1, 2010. * The Agreements have a fixed one-year term and provide for a base salary of $1,500,000 for Mr. Metz and $1,250,000 for Mr. Nolan. * Messrs. Metz and Nolan will continue to participate in the 2010 Cash Value Added Incentive Compensation Plan and commencing with the first fiscal year on or after the Effective Date, are eligible to participate in the company's annual bonus plan in effect with a target bonus opportunity of $3,000,000 and $2,400,000. * Messrs. Metz and Nolan will be granted 125,000 and 100,000 shares of restricted common stock, as of the Effective Date. The restricted stock will vest in its entirety on the first anniversary of the grant date. * The Agreements also provide for a gross-up payment for certain excise taxes under Section 4999 of the Internal Revenue Code, subject to stated limits in the Agreements. Edmund Hoyt, senior vice president of GGP, notes that if the company terminates either Mr. Metz's or Mr. Nolan's employment without "cause" during the Term, the terminated executive is eligible to receive base salary through the termination date, a lump sum payment of a pro-rata amount of such executive's Target Annual Bonus, a lump sum payment equal to seventy five percent of the sum of executive's base salary through the end of the Term and the Target Annual Bonus, vesting of the restricted stock, and continuation of medical benefits through the eighteen month anniversary of the termination date. Full-text copies of the Metz Employment Agreement is available for free at: http://ResearchArchives.com/t/s?6b24 The Nolan Employment Agreement is available at http://ResearchArchives.com/t/s?6b25 About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/--is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 protection 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, serve 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: Elk Grove Has New Settlement With H.S. Wright ------------------------------------------------------------- Debtor Elk Grove Town Center L.P. seeks the U.S. Bankruptcy Court for the Southern District of New York's permission to enter into a new settlement agreement, lien waiver and release with Howard S. Wright Constructors, L.P., resolving HSW's prepetition mechanic's lien claim. Prepetition, Elk Grove engaged HSW under a contract as general contractor to furnish all labor, material, tools, equipment and supervision necessary to produce the buildings, structures, improvements and related facilities for the Debtor's construction project known as the Elk Grove Promenade located at 10565 West Stockton Boulevard, in Elk Grove, California. HSW terminated the Construction Contract with the Debtor in February 2009. Subsequently, HSW timely filed a mechanics' lien for $26,986,121 plus interest, costs, attorneys' fees and other charges for its work at the Elk Grove Promenade Project. In April 2009, HSW initiated an action against the Debtor in the Superior Court of the State of California, Sacramento County, seeking, among others, damages and to foreclose on the Lien. Elk Grove also initiated a separate cross complaint against HSW. In November 2009, HSW timely filed two secured Claim Nos. 4792 and 5111, each asserting $26,986,121 against the Debtor and another Debtor, Elk Grove Town Center, LLC. Elk Grove and HSW previously entered into a Court-approved stipulation whereby Elk Grove made payments to HSW and its subcontractors for $4,561,851. In June 2010, Elk Grove satisfied the lien claim of one of HSW's subcontractors, CEI Roofing, Inc. as assigned to Capital Associates, International, Inc. for $2,330,894. In connection with that payment, HSW and Elk Grove entered into another stipulation whereby they agreed that the principal amount remaining on the HSW Lien as of June 29, 2010 was $20,543,143, exclusive of any interest, costs, attorneys' fees and other charges. HSW and Elk Grove have agreed that, as of August 30, 2010, the principal amount of the HSW Lien, representing the entire prepetition balance resulting from the Contract and the Work HSW provided is $20,093,375 exclusive of interest and attorneys' fees -- the Claim. After arm's-length negotiations, the parties entered into the Settlement Agreement resolving the Claim. The salient terms of the Settlement Agreement are: (a) The Debtor agrees to pay HSW 100% of the remaining amount of the Claim or $20,093,375, plus statutory interest through September 9, 2010 at the rate of 10% per year totaling $4,725,914, plus allowed attorneys' fees for $145,000. (b) HSW agrees to waive any and all present and future claims to attorneys' fees, interest and penalties associated with the HSW Lien and the Claim. (c) HSW agrees to deliver to the escrow agent, prior to payment by the Escrow Agent of the settlement payment, a full lien release for the HSW Lien as well as any liens or other claims from its subcontractors. HSW will satisfy all liens or claims arising from its work at the Elk Grove Project against the amounts paid to it under the Settlement Agreement and will fully exonerate the Debtor from any obligation to any lien holder or claimant relating to HSW's work on the Elk Grove Project. (d) HSW agrees that the HSW Proofs of Claim will be deemed satisfied and will be expunged from the claims register upon HSW's receipt of the Settlement Payment. (e) HSW and Elk Grove have agree to release all claims and causes of action relating to the Elk Grove Project, the Contract, or the Work. Notwithstanding the mutual release, provided that Elk Grove provides written notice of any specific claims before December 31, 2010, Elk Grove reserves any and all claims and causes of action relating to the Work performed by HSW and its subcontractors on the offsite public improvements and HSW reserves all defenses thereto. (f) HSW agrees to indemnify, defend and hold harmless the Debtors against any claims or cause of action asserted by HSW or its subcontractors, suppliers, or other parties providing labor, materials, equipment or supplies in connection with the work performed at the Elk Grove Project due to claims for non-payment or tort claims due to HSW's negligence. Adam P. Strochak, Esq., at Weil, Gotshal & Manges LLP, in New York, stresses that interest was accruing at the per diem rate of $5,520 and interest will continue to accrue should the Settlement Agreement not be approved. Against this backdrop, the Debtors believe that settling the HSW Claim now, under the Settlement Agreement, provides an opportunity for their estates to realize a more favorable resolution than waiting until later in the reorganization process, he relates. The Court will consider the Debtor's request on September 23, 2010. Objections are due September 20. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 protection 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, serve 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) GILL & SURINDER: Case Summary & 16 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Gill & Surinder, LLC 9041 Brighton Road Henderson, CO 80640 Bankruptcy Case No.: 10-33318 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Elizabeth E. Brown Debtor's Counsel: Garry R. Appel, Esq. APPEL & LUCAS, P.C. 1917 Market St., Ste. A Denver, CO 80202 Tel: (303) 297-9800 E-mail: appelg@appellucas.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 16 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cob10-33318.pdf The petition was signed by Balwinder Gill, member/manager. GOTTSCHALKS INC: Expects Wider Net Loss for July 31 2010 Qtr. ------------------------------------------------------------- Gottschalks Inc. disclosed in a regulatory filing Tuesday that it will not be able to file its quarterly report on Form 10-Q for the period ended July 31, 2010, within the prescribed period. The Company was also not able to file its Form 10-K for the fiscal year ended January 31, 2009, its quarterly reports on Form 10-Q for the fiscal quarters ended May 2, August 1, and October 31, 2009, its Form 10-K for the fiscal year ended January 30, 2010, and its quarterly report on Form 10-Q for the fiscal quarter ended May 1, 2010. The Company anticipates that there will be a significant change in results of operations for the three months and six months ended July 31, 2010, as compared to the same periods ended August 1, 2009. The Company anticipates specifically that the results will reflect an operating loss and a net loss for each of the three months and six months that could be significantly greater than in the prior year periods due, in part, to the closure of 59 full- line Gottschalks department stores and 3 specialty stores; the cessation of retail operations; potential asset impairment charges; the results of certain on-going liquidation sales of remaining assets; the winding down of operations; and increased professional fees and costs related to the Company's Chapter 11 proceedings. Because of the on-going work associated with the Chapter 11 proceedings, the Company is currently unable to provide a reasonable estimate of its results of operations for the three months and six months ended July 31, 2010. As of November 1, 2008, the Company's balance sheet showed $364.8 million in assets, $272.3 million in liabilities, and $92.4 million in stockholders' equity. About Gottschalks Inc. Headquartered in Fresno, California, Gottschalks Inc. (Pink Sheets: GOTTQ.PK) -- http://www.gottschalks.com/-- was a department and specialty store chain in United States that operated 58 full-line department stores and 3 specialty stories in 6 western states. The Company filed for Chapter 11 protection on January 14, 2009 (Bankr. D. Del. Case No. 09-10157). Stephen H. Warren, Esq., Karen Rinehart, Esq., Alexandra B. Redwine, Esq., and Ana Acevedo, Esq., at O'Melveny & Myers LLP, represents the Debtor as counsel. Mark D. Collins, Esq., Michael J. Merchant, Esq., and Lee E. Kaufman, Esq., at Richards, Layton & Finger, P.A., serve as the Debtors' co-counsel. The Debtor selected Kurtzman Carson Consultants LLC as its claims agent. When the Debtor filed for protection from its creditors, it disclosed $288,438,000 in total assets and $197,072,000 in total debts. GRAPHIC PACKAGING: Fitch Expects to Rate Senior Bonds at 'B/RR4' ---------------------------------------------------------------- Fitch Ratings expects to rate Graphic Packaging Holding Company's new senior unsecured bonds 'B/RR4' when issued. GPK announced a new issue of up to $250 million of senior unsecured notes due 2018, the proceeds of which are intended to help pay for the tender of a like amount of the company's 9.5% senior subordinated notes due August 2013. The tender for the senior subordinated notes, also announced, is due to expire on Oct. 14, 2010, unless extended. The new senior notes issue is intended to be priced and, as with GPK's other public notes, will be issued by Graphic Packaging International, Inc. and guaranteed by certain domestic subsidiaries, GPK, and Graphic Packaging Corporation. The ratings for GPK's various classes of debt are: -- Issuer Default Rating at 'B'; -- Senior secured revolver at 'BB/RR1'; -- Senior secured term loans at 'BB/RR1'; -- Senior unsecured bonds at 'B/RR4'; -- Senior subordinated notes at 'CCC/RR6'. The Rating Outlook is Stable. GPK's coated recycled boxboard and coated unbleached kraft year- to-date shipments are 1.4% ahead of last year, and Fitch expects EBITDA margins will improve slightly in the back half of 2010 from 14% in the first half due to contractual pricing mechanisms. Net debt of $2.7 billion was 4.7 times EBITDA at the end of the second quarter and could improve to 4.0x by the close of the year contingent on a continuing improvement in packaging volumes and an absence of any inflationary shocks to GPK's cost structure. Fitch anticipates free cash flow in excess of $200 million for the year without a need for any draws under the company's secured $400 million revolver. Key covenants within that agreement specify a maximum consolidated secured leverage ratio of 4.75x; at the end of the second quarter GPK was easily in compliance reporting 2.89x. In substance the early refunding of the senior subordinated notes is viewed as a positive credit event as the coupon on the new senior notes will be substantially lower, and debt maturities will be pushed out, leaving only term loan amortizations as immediate cash calls. GRAPHIC PACKAGING: Moody's Assigns 'B3' Rating on $250 Mil. Notes ----------------------------------------------------------------- Moody's Investors Service assigned a B3 rating to Graphic Packaging International, Inc.'s proposed $250 million senior notes due 2018. Moody's also affirmed the B1 corporate family rating and the company's other existing debt ratings. The proceeds from the proposed note offering will be used to redeem $250 million of the existing 9.50% senior subordinated notes due 2013 and pay related fees and expenses. In addition, Moody's affirmed the company's SGL-2 speculative grade liquidity rating and the outlook remains stable. Ratings Rationale The B1 corporate family rating captures Graphic Packaging's leading position in folding consumer cartons, coated unbleached kraft paperboard, coated recycled boxboard, and multi-wall bag. In addition to extensive customer relationships, the ratings are supported by continued focus on cost improvements, margin stability and good liquidity. Nonetheless, the ratings reflect Graphic Packaging's high leverage, weak demand trends in the paperboard sector, and exposure to potentially high input costs. The company's highly-leveraged capital structure increases refinancing risk within the credit profile over the intermediate term. The stable outlook reflects improved margins and reduced debt levels. Weak demand levels within the paperboard sector are still impacting operating results and may affect pricing, but Moody's believes the company will be able to sustain margin improvements over the rating horizon. Graphic Packaging operates in the more stable food and beverage end markets, thus the company's integrated network, executed synergies and cost reduction plans will allow it to reduce financial leverage over the next twelve to eighteen months in support of the B1 corporate family rating. Moody's could upgrade the ratings and/or outlook if it is evident that the company sustains EBITDA margins in the mid-teens, RCF- Capex/Debt above 5%, and Debt/EBITDA below 4.5x on an adjusted basis. The ratings may be downgraded should the company face significant price and volume deterioration, persistent negative free cash flow, or a material deterioration in liquidity arrangements. The ratings could also be downgraded if its leverage ratio exceeds 6.0x on an adjusted basis. Ratings Assigned: Issuer: Graphic Packaging International, Inc. -- Senior unsecured notes, B3 (LGD5, 87%) Graphic Packaging International, Inc., located in Marietta, Georgia, is a provider of paperboard packaging solutions. GRAPHIC PACKAGING: S&P Assigns 'B' Rating on $250 Mil. Notes ------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'B' issue-level rating (two notches below the corporate credit rating) and '6' recovery rating to Graphic Packaging International Inc.'s proposed $250 million senior unsecured notes due 2018. The notes are expected to be issued under its shelf registration for well-known and seasoned issuers filed on April 27, 2010. The '6' recovery rating indicates S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. The notes are expected to rank equally with all other existing and future unsecured and unsubordinated indebtedness. The corporate credit rating on Graphic Packaging is 'BB-' and the rating outlook is positive. The company will use proceeds from the proposed note issuance, combined with cash on hand, to fund the tender offer for $250 million of its existing 9.5% senior subordinated notes due 2013 and for fees and expenses. Graphic Packaging manufactures paperboard, most of which it uses internally to produce beverage carriers or folding cartons for food, household goods, and other consumer products that tend to be recession-resistant. As a result, in S&P's opinion, the company's paperboard segment (about 85% of sales) fared relatively well during the U.S. recession, with revenue declining by less than 5%. With modest economic improvement, S&P expects demand for paperboard packaging to gradually improve over the next several quarters, and revenue to be relatively flat in 2010 compared with 2009 as contractually lower prices offset modestly higher volumes. Nonetheless, recent price increases should begin to benefit the company in the second half of 2010, with the full effect realized in 2011. Adjusted EBITDA and operating margins (before depreciation and amortization) continue to improve because of on- going productivity improvements, cost savings, and full realization of acquisition synergies. Despite S&P's expectations of relatively flat revenue this year and higher average raw material costs, S&P expects adjusted operating margins in the mid- 15% area in 2010, with further upside in 2011 to around 16% as prices increase contractually. The ratings on GPK reflect the company's improving, but still aggressive financial risk profile represented by its considerable debt burden. The ratings also incorporate GPK's satisfactory business risk profile, which garners support from the company's leading market positions, long-term customer relationships, and value-added product mix; relatively steady earnings capacity; S&P's expectations for sizable free cash flow; the company's stated commitment to reduce debt; and sufficient near-term liquidity. Ratings List Graphic Packaging International Inc. Corporate credit rating BB-/Positive/-- Ratings Assigned $250 Mil. Senior Unsecured Notes Due 2018 B Recovery Rating 6 GREENWOOD ESTATES: Can Access Capmark's Cash Until September 30 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois authorized, on an interim basis, Greenwood Estates MHC, LLC, to use cash securing obligation to Capmark Finance, Inc. The Debtor may access the cash collateral to fund its Chapter 11 case, pay suppliers and other parties until September 30. The Court scheduled a September 29 interim hearing to consider the Debtor's request to further access the cash collateral. As reported in the Troubled Company Reporter on August 16, 2010, the Debtor's manufactured home community in Greenwood, Indiana, is subject to a purported first mortgage in favor of Capmark purportedly securing a claim of $25 million. As adequate protection for any diminution in value of the lenders' collateral, the Debtor will maintain and pay premiums for insurance to cover all of its assets from fire, theft and water damage. The Debtor will, upon reasonable request, make available to Capmark evidence of that which constitutes its collateral or proceeds. The Debtor will properly maintain its assets in good repair and properly manage the Property. As adequate protection for use of the rents, income and any other revenues generated from the Property on and after the Petition Date, the Debtor will grant Capmark replacement liens upon post-petition rents and property that the Debtor acquires after the Petition Date. Any income or revenue generated by the Debtor subsequent to the Petition Date which remains after the payment of the expenses will be segregated by depositing that cash in a newly opened bank account which will contain only the excess cash and won't be comingled with any other funds. About Greenwood Estates Chicago, Illinois-based Greenwood Estates MHC, LLC, filed for Chapter 11 bankruptcy protection on July 30, 2010 (Bankr. N.D. Ill. Case No. 10-33988). Eugene Crane, Esq., at Crane Heyman Simon Welch & Clar, assists the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $10 million to $50 million. GREYSTONE LOGISTICS: HoganTaylor LLP Raises Going Concern Doubt --------------------------------------------------------------- Greystone Logistics, Inc., filed on September 14, 2010, its annual report on Form 10-K for the fiscal year ended May 31, 2010. HoganTaylor LLP, in Tulsa, Okla., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that at May 31, 2010, the Company has a stockholders' deficit of $7.7 million and a working capital deficit of $12.6 million. The Company reported net income of $503,320 on $16.2 million of revenue for fiscal 2010, compared with net income of $912,401 on $16.7 million of revenue for fiscal 2009. Greystone has incurred significant losses from operations; however, for the past three years Greystone has produced positive net income and cash flows from operations. Due to the magnitude of prior losses, the Company remains highly leveraged and the majority of its bank debt is due within one year. Due to the uncertain market in which Greystone operates, there is no assurance that Greystone will continue to achieve operating profitability or otherwise obtain funds necessary to finance continued operations. The Company's balance sheet at May 31, 2010, showed $10.1 million in total assets, $17.8 million in total liabilities, and a stockholders' deficit of $7.7 million. A full-text copy of the Form 10-K is available for free at: http://researcharchives.com/t/s?6b3f Tulsa, Okla.-based Greystone Logistics, Inc. Greystone Logistics, Inc. (OTC BB: GLGI.OB - News) -- http://www.greystonelogistics.com/-- manufactures and sells recycled plastic pallets through its wholly owned subsidiary, Greystone Manufacturing, L.L.C., an Oklahoma limited liability company. As of May 31, 2010, Greystone had an aggregate production capacity of approximately 70,000 pallets per month. HANSEN MEDICAL: Hires Deloitte & Touche as Independent Auditors --------------------------------------------------------------- On September 7, 2010, Hansen Medical, Inc., dismissed PricewaterhouseCoopers LLP as the Company's independent registered public accountant. The dismissal of PwC was approved by the Audit Committee of the Board of Directors of the Company. Based on the Audit Committee's approval, the Company engaged Deloitte & Touche LLP on September 13, 2010, as the Company's independent registered public accountant for the fiscal year ending December 31, 2010. About Hansen Medical Based in Mountain View, Calif., Hansen Medical, Inc. (Nasdaq: HNSN) -- http://www.hansenmedical.com/-- develops products and technology using robotics for the accurate positioning, manipulation and control of catheters and catheter-based technologies. The Company's robotic navigation system enables clinicians to place mapping catheters in hard-to-reach anatomical locations within the heart easily, accurately and with stability during complex cardiac arrhythmia procedures. The Company's balance sheet at June 30, 2010, showed $76.2 million in total assets, $26.8 million in total liabilities, and stockholders' equity of $49.4 million. * * * PricewaterhouseCoopers LLP, in San Jose, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations and negative cash flows from operations since inception. HANSEN MEDICAL: Posts $10.9 Million Net Loss in June 30 Quarter --------------------------------------------------------------- Hansen Medical, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $10.9 million on $7.0 million of revenue for the three months ended June 30, 2010, compared with a net loss of $14.7 million on $2.9 million of revenue for the same period of 2009. As of June 30, 2010, the Company had an accumulated deficit of $235.0 million. The Company's balance sheet at June 30, 2010, showed $76.2 million in total assets, $26.8 million in total liabilities, and stockholders' equity of $49.4 million. PricewaterhouseCoopers LLP, in San Jose, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations and negative cash flows from operations since inception. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6b38 About Hansen Medical Based in Mountain View, Calif., Hansen Medical, Inc. (Nasdaq: HNSN) -- http://www.hansenmedical.com/-- develops products and technology using robotics for the accurate positioning, manipulation and control of catheters and catheter-based technologies. The Company's robotic navigation system enables clinicians to place mapping catheters in hard-to-reach anatomical locations within the heart easily, accurately and with stability during complex cardiac arrhythmia procedures. HEALTHSOUTH CORP: Presents Strategy to Improve Liquidity -------------------------------------------------------- HealthSouth Corporation participated in the Morgan Stanley Global Healthcare Conference in New York City on Sept. 13 & 14, 2010. As The Company presented its strategy and financial performance and discussed industry trends and dynamics. The Company's objectives are to ensure it maintains adequate liquidity and to enhance the flexibility of its capital structure. To achieve these objectives, the Company's capital structure priorities are: * Extend the maturity date of the Company's $400 million revolving credit facility to 2014 or beyond; * Refinance all or substantially all of the Company's approximately $450 million term loan due in March 2013; and * Opportunistically retire/refinance the Company's term loan due 2015 and the Company's 10.75% Senior Notes due 2016. Subject to market conditions, execution of the Company's capital structure strategy could begin during the fall of 2010. A full-text copy of the Presentation is available for free at http://ResearchArchives.com/t/s?6b3e About HealthSouth Corp. Birmingham, Alabama-based HealthSouth Corporation (NYSE: HLS) -- http://www.healthsouth.com/-- is the nation's largest provider of inpatient rehabilitative healthcare services. Operating in 26 states across the country and in Puerto Rico, HealthSouth serves patients through its network of inpatient rehabilitation hospitals, long-term acute care hospitals, outpatient rehabilitation satellites, and home health agencies. The Company's balance sheet at June 30, 2010, showed $1.7 billion in total assets, $2.1 billion in total liabilities, and a shareholders' deficit of $817.3 million. HealthSouth continues to carry a 'B2' corporate family rating with "stable" outlook, from Moody's. It has 'B' foreign and local issuer credit ratings, with "positive" outlook, from Standard & Poor's. HELLER EHRMAN: Plan of Liquidation Wins Court Approval ------------------------------------------------------ The Hon. Dennis Montali of the U.S. Bankruptcy Court for the Northern District of California confirmed Heller Ehrman, LLP's Plan of Liquidation, amended as of August 9, 2010. The Plan provides for the liquidation of the Debtor's remaining assets, the winding up of its affairs and the payment of liabilities through distributions under the Plan. Post- confirmation, the Debtor will be managed by a Plan Administrator, subject to the oversight and approval of the Official Committee of Unsecured Creditors, which may have few as one member as time passes, who will complete the process of liquidating the Debtor's assets, including overseeing the prosecution of certain causes of action against third parties, the recoveries of which may inure to the benefit of Creditors. The Plan Administrator will also be in charge of making distributions to creditors. Payments under the will be funded through a combination of: (1) the proceeds of causes of actions against third parties; (2) the Debtor's cash on hand at confirmation, and (3) a $3,000,000 exit financing facility provided by the six partners that hold an equity interest in the Debtor (Heller Ehrman (California), Heller Ehrman White & McAuliffe (Washington), P.S, Heller Ehrman White & McAuliffe (Oregon), P.C., Heller Ehrman (Alaska), P.C., Heller Ehrman (New York), and Heller Ehrman (China), P.C. Treatment of Claims Class Estimated Recovery ----- ------------------ 4 - Secured Claims of BofA and Citibank 100% 5 - Secured Claim of MPC 100% 6 - Insured Malractice Claims 100% 7 - Unsecured Claims 22% - 68% 8 - Subordinated Biggers Unsecured Claims 0% 9 - Subordinated Former Shareholder Claims 0% 10 - Interests 0% A full-text copy of the Amended Plan is available for free at: http://bankrupt.com/misc/HellerEhrman_PlanAug9.pdf About Heller Ehrman, LLP Headquartered in San Francisco, California, Heller Ehrman, LLP -- http://www.hewm.com/-- was an international law firm of more than 730 attorneys in 15 offices in the United States, Europe, and Asia. Heller Ehrman filed a voluntary petition under Chapter 11 of the Bankruptcy Code on December 28, 2008 (Bankr. N.D. Calif., Case No. 08-32514). Members of the firm's dissolution committee led by Peter J. Benvenutti approved a plan dated September 26, 2008, to dissolve the firm. The Hon. Dennis Montali presides over the case. Pachulski Stang Ziehl & Jones LLP assists the Debtor in its restructuring effort. The Official Committee of Unsecured Creditors is represented Felderstein Fitzgerald Willoughby & Pascuzzi LLP. The firm estimated assets and debts at $50 million to $100 million. According to reports, the firm still had roughly $63 million in assets and 54 employees at the time of its filing. HERITAGE STANDARD: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Heritage Standard Corporation 2911 Turtle Creek Boulevard, Suite 850 Dallas, TX 75219 Bankruptcy Case No.: 10-36485 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Kevin D. McCullough, Esq. ROCHELLE MCCULLOUGH L.L.P. 325 N. St. Paul Street, Suite 4500 Dallas, TX 75201 Tel: (214)953-0182 Fax: (214)953-0185 E-mail: kdm@romclawyers.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Michael B. Wisenbaker, president. Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Heritage Consolidated, LLC 10-36484 09/14/10 Heritage Standard's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Aquila Drilling Company LP Trade $4,926,430 2525 Kell Boulevard, Suite 405 Wichita Falls, TX 76308 Pathfinder Energy Services, Inc. Trade $1,566,000 6213 W. Interstate 20 Midland, TX 79706-3347 Weatherford US LP Trade $826,375 11943 Fm 529 Road Houston, TX 77041 C.C. Forbes Company LP Trade $793,845 4783 S. US Highway 281 Alice, TX 78332 SWACO Trade $718,747 8522 Andrews Highway Odessa, TX 79765-2831 Aries Well Service, Inc. Trade $469,997 2626 W. Marland P.O. Box 784 Hobbs, NM 88240 Simons Petroleum Trade $259,316 210 Park Avenue, Suite 1800 Oklahoma City, OK 73102 Coastal Chemical Co., LLC Trade $244,723 Patterson Rental Tools Trade $229,160 ITS Rental & Sales Trade $224,918 Arguijo Oilfield Serv., Inc. Trade $193,318 Smith International, Inc. Trade $188,760 Nave Oil & Gas, LLC Trade $188,089 O-TEX Pumping, LLC Trade $185,050 Frac Tech Services, Ltd Trade $153,721 Well-Foam, Inc. Trade $152,881 Liberty Pump & Supply Co. Trade $147,595 Double R. Pipe & Supply, Inc Trade $139,915 Baker Oil Tools Trade $119,850 O-D Rentals Trade $113,643 HFG 231: Case Summary & 6 Largest Unsecured Creditors ----------------------------------------------------- Debtor: HFG 231, LLC 736 Bryant Street Woodmere, NY 11598 Bankruptcy Case No.: 10-77208 Chapter 11 Petition Date: Court: U.S. Bankruptcy Court Eastern District of New York (Central Islip) Judge: Alan S. Trust Debtor's Counsel: Joseph S. Maniscalco, Esq. LAMONICA HERBST MANISCALCO 3305 Jerusalem Avenue Wantagh, NY 11793 Tel: (516) 826-6500 Fax: (516) 826-0222 E-mail: jsm@lhmlawfirm.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Shem Rokeach, member. Debtor's List of six Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hospitality Investors Group, LLC -- $1,000,000 7417 South Flagler Drive West Palm Beach, FL 33405 Hamilton Financial Group, LLC -- $526,039 736 Bryant Street Woodmere, NY 11598 Troutman Sanders, LLP -- $47,628 405 Lexington Avenue New York, NY 10174 Margolin Winer & Evans -- $3,000 Tannenbaum, Helpern, Syracuse & -- $1,559 Hirschtritt, LLP Rhodes Building Management, Inc. -- $500 HUNTER LAKES: Case Summary & Largest Unsecured Creditor ------------------------------------------------------- Debtor: Hunter Lakes, LLC 7215 East 21st Street, Suite A Indianapolis, IN 46219 Bankruptcy Case No.: 10-13855 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court Southern District of Indiana (Indianapolis) Judge: Anthony J. Metz III Debtor's Counsel: James S. Kowalik, Esq. HOSTETLER AND KOWALIK, P.C. 101 W Ohio St., Suite 2100 Indianapolis, IN 46204 Tel: (317) 262-1001 Fax: (317) 262-1010 E-mail: jsk@hostetler-kowalik.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ The Huntington National 63 acres of $3,760,308 Bank vacant land 45 North Pennsylvania Street Suite 400 Indianapolis, IN 46204 The petition was signed by Ronald E. Farren, member. ICONIX BRAND: S&P Affirms Corporate Credit Rating at 'B+' --------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating on Iconix Brand Group. The outlook is stable. Concurrently, S&P affirmed the 'BB' issue rating on its senior term debt. The recovery rating is '1', which indicates S&P's expectation of very high (90% to 100%) recovery for lenders in the event of payment default. S&P also raised the issue rating on the company's senior subordinated notes to 'B+' (same as the corporate credit rating) from 'B'. S&P revised the recovery rating to '3', which indicates its expectation of meaningful (50% to 70%) recovery for lenders in the event of payment default, from '5'. "S&P raised the issue-level rating and revised the recovery rating on Iconix's senior subordinated notes as a result of the term loan prepayment and incremental revenue generated from the company's recent acquisitions over the last twelve months," said Standard & Poor's credit analyst Jacqueline Hui. "The ratings on Iconix Brand Group reflect what S&P view as the company's aggressive financial risk profile and its participation in the highly competitive and volatile fashion apparel industry, which S&P believes supports a weak business risk profile," Ms. Hui added. Other factors include licensing contract renewal risk, predictable royalty income-based business model and high margins. S&P believes credit metrics are currently strong for the rating category; however, the ratios are somewhat volatile due to the company's highly acquisitive nature. Nevertheless, S&P expects the company to maintain credit measures at least in line with the 'B+' category mediums if it makes further acquisitions. S&P believes the company has an aggressive growth strategy, as demonstrated by the 25 brands acquired since 2004. The company continues to expand its international presence through a joint venture in Europe formed in December 2009, in addition to its 2008 joint ventures in China and Latin America. Its most recent acquisitions include a 51% controlling interest in Ecko brands in October 2009, a 50% interest in MG Icon in March 2010 and an 80% interest in Peanuts Holdings in June 2010. With the majority of its sales abroad, the company further expands its international presence. Standard & Poor's expects the company to continue to make acquisitions and enter into partnerships to diversify its brand portfolio and build scale to support its licensing business. Iconix's expanding portfolio includes certain brands that required revitalization and the company has been able to grow these brands, which include Bongo, London Fog, and Rampage. The portfolio also consists of several already popular brands, such as Mossimmo, Candie's, and Mudd, some of which the company successfully rejuvenated in recent years. Moreover, the vast majority of the portfolio enjoys strong overall brand recognition. The company's royalty-based business model is predicated upon providing brand management and trend direction for the licensees, which generate a predictable stream of royalty income. This model generates very significant margins as the licensee is responsible for design, manufacturing, logistics and working-capital management. However, there is licensing contract renewal risk, as the majority of the licensing contracts are between three and five years at the licensee's option to renew upon expiration. The stable outlook reflects the company's ability to maintain solid operating margins and adequate liquidity amid a still uncertain retail environment. S&P expects Iconix to maintain high EBITDA margins and cash flows resulting from its growing royalty income streams. S&P could lower the rating if the company cannot generate the expected levels of royalty income, possibly as a result of an inability to renew its licensing agreements, resulting in its financial condition deteriorating, the covenant cushion level tightening, and leverage increasing to over 4.5x. An EBITDA decline of 27% would cause leverage to rise to 4.5x. Although unlikely in the near term, S&P may consider a higher rating if the company achieves and sustains strong operating results, mitigates its license renewal risk, and reduces debt leverage to 2.5x. S&P estimates this scenario could occur if EBITDA increased 31% (assuming debt levels do not significantly change). INFINISTAFF LLC: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Infinistaff,LLC fdba Outsol,LLC 58 River Street Milford, CT 06460 Bankruptcy Case No.: 10-32733 Chapter 11 Petition Date: September 13, 2010 Court: United States Bankruptcy Court District of Connecticut (New Haven) Judge: Lorraine Murphy Weil Debtor's Counsel: Peter L. Ressler, Esq. GROOB RESSLER & MULQUEEN 123 York Street, Suite 1B New Haven, CT 06511-0001 Tel: (203) 777-5741 Fax: (203) 777-4206 E-mail: ressmul@yahoo.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ctb10-32733.pdf The petition was signed by Jason Sheehan, member. ISLAND ONE: Bay Harbour Interested in Investing ----------------------------------------------- NetDockets reports that Island One, Inc. and its debtor-affiliates operate these resorts: -- Barefoot'n in the Keys (Kissimmee, Florida) -- Bryan's Spanish Cove (Orlando, Florida) -- Liki Tiki Village (Orlando) -- Orbit One Vacation Villas (Orlando) -- Parkway International Resort (Orlando) -- Charter Club (Naples, Florida) -- The Cove on Ormond Beach (Ormond Beach, Florida) -- The Crescent Resort on South Beach (Miami, Florida) -- Chenay Bay Resort (St. Croix, U.S. Virgin Islands) According to netDockets, the Debtors have been in default under loan facilities from Textron Financial Corporation, Liberty Bank, N.A. and BB&T Acquired Assets Group for several months but have been operating under forbearance agreements. The report relates that the Debtors are obligated to Textron, Liberty and BB&T in the approximate amounts of $99 million, $7.9 million, and $39 million, respectively, and those obligations are secured by certain of the companies' assets. netDockets, citing court documents, says that the assets securing the BB&T obligations have a value of $46.8 million, but that the values of the assets securing the Textron and Liberty obligations are "uncertain." During the forbearance period, the report notes, the Debtors and their lenders have had on-going discussions with Bay Harbour Management regarding a potential sale of the Debtors' equity to Bay Harbour. However, court documents report that the Debtors' cash needs exceeded their outstanding availability and the Debtors "feared that they may have to reduce or even cease certain operations" which would jeopardize the sale of their assets or equity, the report discloses. Therefore, netDockets adds, the Debtors determined to file for chapter 11 but they report that Bay Harbour "has informed the debtors that it is interested in entering into immediate negotiations for purchase of the equity." About Island One Island One and its affiliates have developed and managed time- share resorts in Florida and the U.S. Virgin Islands since 1981. Through Navigo Vacation Club, the companies have developed a timeshare network that extends throughout the U.S., Latin America, the Caribbean and Europe. Island One Inc. and five affiliates of the resort company filed for bankruptcy protection in Orlando, Florida (Bankr. M.D. Fla. Lead Case No. 10-16177). Orlando-based Island One estimated both assets and debt in the range of $100 million to $500 million in its Chapter 11 petition. Elizabeth A. Green, Esq., at Baker & Hostetler LLP, in Orlando, Florida, serves as counsel to the Debtors. JACOBS FINANCIAL: Operating Losses Prompt Going Concern Doubt ------------------------------------------------------------- Jacobs Financial Group, Inc., filed on September 13, 2010, its annual report on Form 10-K for the fiscal year ended May 31, 2010. Malin, Bergquist & Company, LLP, in Pittsburgh, Pa., expressed substantial doubt about Jacobs Financial's ability to continue as a going concern. The independent auditors noted of the Company's significant net working capital deficit and operating losses. The Company reported a net loss attributable to common stockholders of $2.7 million on $1.4 million of revenue for fiscal 2010, compared to a net loss attributable to common stockholders of $3.1 million on $1.2 million of revenue for fiscal 2009. The Company's balance sheet at May 31, 2010, showed $7.8 million in total assets, $11.5 million in total liabilities, $3.0 million in mandatorily redeemable preferred stock, and a stockholders' deficit of $6.7 million. A full-text copy of the Form 10-K is available for free at: http://researcharchives.com/t/s?6b35 About Jacobs Financial Jacobs Financial Group, Inc. (OTC Bulletin Board: JFGI) is a Charleston, West Virginia-based holding company for First Surety Corporation, a West Virginia domiciled surety, Triangle Surety Agency, an insurance agency that specializes in coal reclamation surety bonds, and Jacobs & Company, a registered investment advisor. JEFFRY FORCIER: Case Summary & 14 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Jeffry Dean Forcier 2405 Main Street Napa, CA 94558 Bankruptcy Case No.: 10-13516 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: Michael C. Fallon, Esq. LAW OFFICES OF MICHAEL C. FALLON 100 E. Street, #219 Santa Rosa, CA 95404 Tel: (707) 546-6770 E-mail: mcfallon@fallonlaw.net Scheduled Assets: $1,136,675 Scheduled Debts: $1,675,742 A list of the Debtor's 14 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-13516.pdf JENNIFER DERVIS: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Jennifer J. Dervis 96 Elm Street Somerville, MA 02144 Bankruptcy Case No.: 10-19973 Chapter 11 Petition Date: September 13, 2010 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Henry J. Boroff Debtor's Counsel: Philip C. Silverman, Esq. ANDERSON AQUINO LLP 240 Lewis Wharf Boston, MA 02110 Tel: (617) 723-3600 Fax: (617) 723-3699 E-mail: psilverman@andersonaquino.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. JOHN CAHILL: Case Summary & 13 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: John P. Cahill 507 Ridgelawn Trail Batavia, IL 60510 Bankruptcy Case No.: 10-40929 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: Jack B. Schmetterer Debtor's Counsel: Forrest L. Ingram, Esq. FORREST L. INGRAM, P.C. 79 W Monroe Street, Suite 900 Chicago, IL 60603 Tel: (312) 759-2838 Fax: (312) 759-0298 Email: fingram@fingramlaw.com Scheduled Assets: $1,138,037 Scheduled Debts: $880,347 A list of the Debtor's 13 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/ilnb10-40929.pdf KEVIN O'KEEFE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Kevin C. O'Keefe dba MORTCO 130 San Marino Drive San Rafael, CA 94901 Bankruptcy Case No.: 10-13522 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: Michael C. Fallon, Esq. LAW OFFICES OF MICHAEL C. FALLON 100 E. Street, #219 Santa Rosa, CA 95404 Tel: (707) 546-6770 E-mail: mcfallon@fallonlaw.net Scheduled Assets: $3,267,289 Scheduled Debts: $4,225,240 A list of the Debtor's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-13522.pdf KNIGHT STOKES: Case Summary & 15 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Knight Stokes, LLC dba Beaver Creek Mobile Home Park dba Perkins Mobile Home Park P.O. Box 1929 Loganville, GA 30052 Bankruptcy Case No.: 10-31651 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court Middle District of Georgia (Athens) Debtor's Counsel: William A. Rountree, Esq. MACEY, WILENSKY, KESSLER & HENNINGS, LLC 230 Peachtree Street NW, Suite 2700 Atlanta, GA 30303-1561 Tel: (404) 584-1244 Fax: (404) 681-4355 E-mail: mharris@maceywilensky.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 15 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/gamb10-31651.pdf The petition was signed by Todd M. Hogan, managing member. KNOLOGY INC: Moody's Assigns 'B1' Rating on $770-Mil. Loan ---------------------------------------------------------- Moody's Investors Service assigned B1 ratings to Knology, Inc.'s $770 million of proposed First Lien Senior Secured Bank Credit Facilities and affirmed the company's existing B1 Corporate Family Rating and B2 Probability of Default Rating. The new credit facilities will refinance Knology's $639 million of existing credit facilities (under which approximately $577 million is expected to be outstanding at closing, and the ratings for which will be withdrawn upon successful completion of the refinancing and corresponding debt repayment) and augment excess cash balances of approximately $52 million to fund the announced $165 million acquisition of Sunflower Broadband later this year. The Speculative Grade Liquidity Rating remains SGL2, indicating "good" proforma liquidity, and the rating outlook remains stable. This summarizes Moody's ratings and the rating actions for Knology: * Corporate Family Rating -- affirmed B1 * Probability of Default Rating -- affirmed B2 * Speculative Grade Liquidity Rating -- SGL-2 * $570 million Gtd. Sr. Sec. Term Loan B due 2016 - assigned B1 (LGD-3, 34%) * $150 million Gtd. Sr. Sec. Term Loan A due 2015 - assigned B1 (LGD-3, 34%) * $50 million Gtd. Sr. Sec. Revolving Credit Facility due 2015 -- assigned B1 (LGD-3, 34%) * $614 million Gtd. Sr. Sec. Term Loan due 6/30/12 -- B1 (LGD-3, 33%)* * $25 million Gtd. Sr. Sec. Revolving Credit Facility due 6/30/12 -- B1 (LGD-3, 33%)^ ^ to be withdrawn upon successful completion of the proposed refinancing and corresponding debt repayment Ratings Rationale Knology's B1 CFR continues to broadly reflect the company's comparatively small size and the underlying business risks inherent to its "overbuilder" operating model, including intensifying competition from larger and better capitalized cable and direct broadcast satellite companies and telecom operators. Ratings are also constrained by the company's moderately high financial leverage and acquisitive growth strategy, notwithstanding generally successful historical integration and partial cash funding of the latter. Over time Moody's expect these risks may be somewhat better mitigated by ongoing growth of the company's customer base, whether through additional acquisitions or further penetration of the existing subscriber base via market share gains. Knology's ratings are supported by its attractive footprints in secondary and tertiary markets and the company's history of meeting planned targets, including improved free cash flow generation, EBITDA growth and absolute debt reduction. Key credit metrics have strengthened over the past couple of years, with debt-to-EBITDA declining to 4.2x and free cash flow-to-debt approximating 8% at 6/30/2010 (incorporating Moody's standard adjustments) from 4.7x and 6%, respectively, at the beginning of 2009. Ratings also continue to reflect Knology's deemed good liquidity profile, which is supported by access to external sources of funds and the company's improved cash generating capabilities. On August 4, 2010, Knology announced a definitive agreement to acquire the assets of Sunflower Broadband, an incumbent cable multiple system operator serving residential and business customers in Kansas (approximately 54 thousand homes passed and 105 thousand RGUs) for $165 million. The transaction is expected to close early in the fourth quarter and will be funded with a combination of existing balance sheet cash and a portion of the aforementioned new bank credit facilities. As indicated on August 5, 2010, Moody's continue to believe that the proposed acquisition is consistent with the company's historical track record of growth through acquisition (albeit into new markets via an incumbent service provider), and while the purchase price multiple (estimated by company management to be approximately 7.5x the $22 million of reported EBITDA) appears somewhat high (particularly relative to now lower market multiples), the consolidated proforma leverage and free cash flow profile are not expected to be materially impacted (note that leverage is expected to approximate 4.4x on a proforma basis, and trend lower to an adjusted 4.3x as projected synergies are realized). "Upon review of the proposed refinancing and pending acquisition Moody's have determined this trasaction to have limited impact on the company's capital structure and believe that Knology's credit profile remains consistent with a B1 CFR and a B2 PDR," noted Russell Solomon, Moody's Senior Vice President and lead analyst for the company. Rating Outlook The rating outlook is stable, reflecting Moody's view that Knology will continue to demonstrate steady operating performance and maintain financial metrics commensurate with its rating category. The stable outlook also assumes that Knology's management team will adhere to prudent fiscal policies, including conservatively financed acquisition strategies. What Could Change the Rating -- Up Moody's believes that consistent revenue and subscriber growth, coupled with maintaining or improving EBITDA margins, free cash flow production and good liquidity, and continued improvement in financial leverage trending toward and remaining below 3.25x on a sustained basis could warrant consideration of a positive rating outlook and/or a prospective upgrade of the CFR to Ba3. What Could Change the Rating -- Down Conversely, deterioration in operations, including unexpected subscriber losses, liquidity erosion and/or an increase in financial leverage that would be sustained above 4.5x, such as to support a debt-financed acquisition, could pressure ratings down or cause Moody's to change the outlook to negative. Corporate Profile Knology, Inc., is a provider of video, high speed data and voice services to approximately 232 thousand video subscribers. These subscribers are primarily located in the Southeast and the upper Midwest regions of the country. Knology's business model is that of an "overbuilder" in which the company builds or acquires networks in regions overlapping that of larger incumbent cable operators, such as Mediacom (rated B1) and Comcast (rated Baa1), and attempts to differentiate itself with high quality product offerings and efficient but localized customer service. Knology generated revenue of approximately $436 million for the twelve month period ended June 30, 2010. KNOLOGY INC: S&P Assigns 'B+' Rating on $770 Mil. Senior Notes -------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its issue- level and recovery ratings to West Point, Georgia-based cable overbuilder Knology Inc.'s proposed $770 million senior secured credit facility. The facility consists of a $50 million revolver, a $150 million term loan A, and a $570 million term loan B. S&P rated the bank loan 'B+' (the same as the corporate credit rating) with a '3' recovery rating, which indicates expectations for meaningful (50%-70%) recovery in the event of default. At the same time, S&P affirmed its 'B+' corporate credit rating on Knology. The outlook is stable. The company plans to use the proceeds of the new facility to fund the $165 million purchase price for incumbent cable operator Sunflower Broadband, refinance about $577 million of existing debt, and pay related fees and expenses. S&P expects the revolver to be undrawn at closing. "Despite the modest increase in leverage because of the transaction to about 4.4x from 4.1x as of June 30, 2010," said Standard & Poor's credit analyst Allyn Arden, "S&P expects credit measures to remain supportive of the current rating in the intermediate term." Moreover, the acquisition moderately improves Knology's business risk profile given the incumbent status of Sunflower, which will represent around 10% of total revenue. KY USA: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------- Debtor: KY USA Energy, Inc. 231 West Main Street Glasgow, KY 42141 Bankruptcy Case No.: 10-11424 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court Western District of Kentucky (Bowling Green) Debtor's Counsel: Scott A. Bachert, Esq. HARNED BACHERT & MCGEHEE PSC 324 E 10th St P.O. Box 1270 Bowling Green, KY 42102 Tel: (270) 782-3938 E-mail: bachert@hbmfirm.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/kywb10-11424.pdf The petition was signed by Steve Eversole, president. LEAP WIRELESS: Board Adopts Tax Benefit Preservation Plan --------------------------------------------------------- Leap Wireless International Inc. said that its Board of Directors has adopted a tax benefit preservation plan intended to preserve the long-term value of the Company's net operating loss carryforwards. As of June 30, 2010, Leap had net operating loss carry forwards of approximately $1.7 billion, which could be used to reduce future federal and state income tax obligations. However, the Company's ability to use these NOLs may be substantially limited if it were to experience an "ownership change" as defined under Section 382 of the Internal Revenue Code. In general, an ownership change would occur if stockholders that own at least 5% or more of Leap's outstanding common stock increased their cumulative ownership in the Company by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. As part of the plan, the Company's Board of Directors declared a dividend of one preferred stock purchase right on each outstanding share of Leap common stock. The dividend will be payable to holders of record as of the close of business on September 24, 2010. Any shares of Leap common stock issued after the record date will be issued together with the rights. The preferred stock purchase rights are not currently exercisable and initially will trade only with the Leap common stock. However, if any person or group acquires 4.99% or more of Leap common stock, or if a person or group that already owns 4.99% or more of Leap common stock acquires additional shares, then, subject to certain exceptions, the preferred stock purchase rights would separate from the common stock and become exercisable for shares of Leap common stock having a market value equal to twice the exercise price, resulting in significant dilution to the ownership interests of the acquiring person or group. "Recent trading in the Company's stock has increased the risk of an ownership change under the tax rules," said Doug Hutcheson, Leap's president and CEO. "After thoughtful consideration, our Board implemented this tax benefit preservation plan to help protect the value of our NOLs and reduce the likelihood that changes in our investor base could have the unintended effect of limiting our ability to use them. These NOLs represent a significant corporate asset that we believe will deliver substantial benefits to our stockholders as we generate taxable income in the future." The Company's Board of Directors has established a procedure to consider requests to exempt acquisitions of Leap common stock from the plan if it determines that doing so would not limit or impair the availability of the NOLs. The rights will expire on September 30, 2020. The rights may also expire on an earlier date upon the occurrence of other events, including a determination by the Company's Board of Directors that the NOLs have been utilized or are no longer available, or that the plan is no longer necessary to protect the NOLs. The plan also may be terminated at any time by the Board before the rights become exercisable. The plan is similar to tax preservation plans adopted by many other public companies with significant NOLs. The issuance of the preferred stock purchase rights will not affect the Company's reported earnings or loss per share and is not taxable to the Company or its stockholders. About Leap Wireless Headquartered in San Diego, California, Leap Wireless International, Inc. (NASDAQ: LEAP) -- http://www.leapwireless.com/ -- and its joint ventures provide wireless services in 34 states and the District of Columbia and hold licenses in 35 of the top 50 U.S. markets. Through its affordable, flat-rate service plans, Cricket offers customers a choice of unlimited voice, text, high- speed data and mobile Web services. Leap spun out from Qualcomm Inc. in 1998 and expanded primarily into rural markets. It has customers in 34 states and annual sales around $2.3 billion, making it the seventh-largest wireless carrier in the U.S., according to The Wall Street Journal. At March 31, 2010, the Company had total assets of $5.26 billion, total liabilities of $3.58 billion, redeemable non- controlling interests of $51.8 billion, and stockholders' equity of $1.63 billion. The Troubled Company Reporter on February 2, 2010, citing The Wall Street Journal's Jeffrey McCracken and Niraj Sheth, said Leap Wireless has hired Goldman Sachs Group and formed a special board committee to look into selling the company or merging with rivals. Leap Wireless has reported net losses in the last three years. It incurred a net loss of $239.5 million, $150.2 million and $80.3 million in 2009, 2008 and 2007. Leap Wireless carries a 'B2' corporate family rating from Standard & Poor's. LIBERTY TIRE: Moody's Assigns 'B2' Corporate Family Rating ---------------------------------------------------------- Moody's Investors Service has assigned a B2 Corporate Family Rating and Probability of Default Rating to Liberty Tire Recycling Holdco, LLC. The rating agency assigned a B3 to the company's proposed offering of $200 million of senior unsecured notes due 2016. The company's $60 million revolving credit facility was not rated. The ratings outlook is stable. Proceeds will be used to refinance $167 million of debt, pay transaction fees, and for general corporate purposes. Assignments: Issuer: Liberty Tire Recycling Holdco, LLC -- Probability of Default Rating, Assigned B2 -- Corporate Family Rating, Assigned B2 -- $200 million Senior Unsecured Notes, rated B3, LGD4-64% Ratings Rationale The B2 CFR rating balances Liberty Tire's well established position as the leading scrap tire collector and recycler in the United States against recent year's weak net margins, minimal EBIT margins, and significant leverage. The ratings reflect recent and anticipated improvements in EBITDA stemming from acquisitions that were completed in 2009 and thus far in 2010. The company completed seven acquisitions in the LTM period through June 30, 2010. The B3 rating on the notes reflects their senior unsecured status and overall ranking in the capital structure. The notes will be fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by the Issuer's existing and future domestic subsidiaries. As senior unsecured notes, the notes will rank junior in right of payment to the company's secured debt. Liberty Tire Recycling Finance, Inc., is a co-issuer of the notes. The stable ratings outlook reflects the expectation that revenues and EBITDA will grow over the next year largely driven by recent acquisitions. Moody's expect credit metrics to remain in line with the B2 CFR over the next year. The outlook could be changed to positive if leverage is reduced to under 4 times and free cash flow to debt rises above 8% on a sustained basis. The rating could be downgraded if total debt/EBITDA is expected to be sustained above 5 times or if the company was to experience meaningful difficulty in integrating its acquisitions. A large debt financed acquisition could also adversely affect the rating and/or the rating outlook. Liberty Tire Recycling Holdco, LLC, headquartered in Pittsburgh, PA is the leading scrap tire collector and recycler in the United states with total LTM revenues through June 2010 of $204 million. LINCOLN LOGS: Customers' Funds Are Not Property of the Estate ------------------------------------------------------------- Under New York law, WestLaw reports, a "home improvement contract," such as will impose trust obligations on a contractor with respect to money received on that contract, was not limited to a contract for the construction of a custom home but also included a contract for the sale of such a home. Thus, the mere fact that log home company from which property owners agreed to purchase a custom log chalet only supplied property owners with log home building packages and depended on third-party contractors to assemble those packages did not prevent the contract between company and the property owners for the sale and purchase of their custom log chalet from qualifying as a "home improvement contract." A bankruptcy judge presiding over the log home company's Chapter 11 case relied on a statutory trust theory in finding that contract funds were not included in the Chapter 11 estate. In re Lincoln Logs Ltd., --- B.R. ----, 2010 WL 322163, 63 Collier Bankr.Cas.2d 862 (Bankr. N.D.N.Y.). Chestertown, N.Y.-based custom home builder Lincoln Logs Ltd. and its debtor-affiliate, Snake River Log Homes, LLC, sought chapter 11 protection (Bankr. N.D.N.Y. Case Nos. 08-13079 and 08-13080) on Sept. 19, 2008, represented by Angela Z. Miller, Esq., at Phillips Lytle LLP in Buffalo, N.Y. At the time of the filing, the Debtors estimated their assets at less than $10 million and their debts at more than $10 million. Most of the debtors' assets were sold in early 2009 for about $3.5 million. The Debtors filed a Chapter 11 Joint Plan of Liquidation on Mar. 5, 2009 and an Amended Chapter 11 Joint Plan of Liquidation on May 4, 2009. By order dated July 20, 2009, the Amended Chapter 11 Joint Plan of Liquidation was confirmed, and a liquidating trust was formed with Justin A. Heller, Esq., appointed as the Liquidation Trustee. The Plan provides for an absolute priority distribution to holders of claims against the Debtors. LINCOLNSHIRE CAMPUS: Promises to Pay Claims from Cash Proceeds -------------------------------------------------------------- Lincolnshire Campus, LLC, and its debtor-affiliates submitted to the U.S. Bankruptcy Court for the Northern District of Texas a proposed Plan of Reorganization and an explanatory Disclosure Statement. The Debtors will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the Plan provides for the payment or full satisfaction of all secured tax claims, senior mechanic's lien claims, administrative claims, and unsecured priority claims. The Plan also provides that the holders of secured claims will receive cash equal to their pro rata share of the cash proceeds after the payment of administrative claims, senior mechanic's lien claims, and the costs for administering the Plan. Holders of unsecured claims will be entitled to receive cash equal to the holder's pro rata share of the Creditor Trust. Holders of subordinated claims and equity interests won't receive anything. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/LINCOLNSHIRECAMPUS_DS.pdf About the Debtors Lincolnshire Campus filed for Chapter 11 bankruptcy protection on June 15, 2010 (Bankr. N.D. Tex. Case No. 10-34176). Vincent P. Slusher, Esq., at DLA Piper LLP US, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100 million to $500 million. Not-for-Profit Entities Sedgebrook, Inc., and Monarch Landing Inc. filed for Chapter 11 protection on June 15, 2010. The Lincolnshire Debtors and the NFP Debtors are affiliate of Erickson Retirement Communities LLC. Baltimore, Maryland-based Erickson Retirement Communities LLC, along with affiliates, filed for Chapter 11 protection on Oct. 19, 2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US) serves as counsel to the Debtors. BMC Group Inc. serves as claims and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also serving as investment and financial consultant. Alvarez & Marsal is serving as restructuring adviser. Judge Stacey G.C. Jernigan confirmed Erickson's Plan of Reorganization on April 16, 2010. The confirmed Chapter 11 Plan is premised on the $365 million sale of substantially all of the Erickson Retirement assets to Redwood Capital Investments LLC and its affiliates. The Plan became effective on April 30, 2010. Erickson own 20 continuing care retirement communities in 11 states. Among Erickson's 20 communities, eight are completed, 11 are open although in construction, and one is in development. They have 23,000 residents in total. LINCOLNSHIRE CAMPUS: U.S. Trustee Amends Resident's Committee ------------------------------------------------------------- William T. Neary, the U.S. Trustee for Region 6, amended the Official Resident's Committee in the Chapter 11 cases of Lincolnshire Campus, LLC, et al. The Committee now consists of: 1. Paul Goldstein 820 Audubon Way, PT-210 Lincolnshire, IL 60069 Tel: (847) 793-0202 E-mail: laup60@aol.com 2. Robert Estabrooks 2004 Audubon Avenue, MC-429 Naperville, IL 60563 Tel: (630) 357-7614 E-mail: bobesta@aol.com 3. Sarah Martin 2004 Audubon Avenue, MC-129 Naperville, IL 60563 Tel: (630) 355-6550 E-mail: sjmar@msn.com 4. Carol Dapogny 2033 Butterfly Lane, CC-T02 Naperville, IL 60563 Tel: (630) 983-0226 E-mail: cdapogny@aol.com 5. Carol Hedtcke 2004 Audubon Avenue, BT-402 Naperville, IL 60563 Tel: (630) 355-8663 E-mail: cshedtcke@att.net 6. Sally Hering 840 Audubon Way, HG-109 Lincolnshire, IL 60069 Tel: (847) 793-0575 E-mail: salhering@aol.com 7. Ed Matthei 890 Audubon Way, BW-502 Lincolnshire, IL 60069 Tel: (847) 793-0939 E-mail: ematthei@sbcglobal.net 8. Lou Sherman 830 Audubon Way, HG-408 Lincolnshire, IL 60069 Tel: (847) 821-1471 E-mail: shirlou05@aol.com 9. Charles VanWiggeren 810 Audubon Way, HP-416 Lincolnshire, IL 60069 Tel: (847) 478-8728 E-mail: ctvan471@sbcglobal.net Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About the Debtors Lincolnshire Campus filed for Chapter 11 bankruptcy protection on June 15, 2010 (Bankr. N.D. Tex. Case No. 10-34176). Vincent P. Slusher, Esq., at DLA Piper LLP US, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100 million to $500 million. Not-for-Profit Entities Sedgebrook, Inc., and Monarch Landing Inc. filed for Chapter 11 protection on June 15, 2010. The Lincolnshire Debtors and the NFP Debtors are affiliate of Erickson Retirement Communities LLC. Baltimore, Maryland-based Erickson Retirement Communities LLC, along with affiliates, filed for Chapter 11 protection on Oct. 19, 2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US) serves as counsel to the Debtors. BMC Group Inc. serves as claims and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also serving as investment and financial consultant. Alvarez & Marsal is serving as restructuring adviser. Judge Stacey G.C. Jernigan confirmed Erickson's Plan of Reorganization on April 16, 2010. The confirmed Chapter 11 Plan is premised on the $365 million sale of substantially all of the Erickson Retirement assets to Redwood Capital Investments LLC and its affiliates. The Plan became effective on April 30, 2010. Erickson own 20 continuing care retirement communities in 11 states. Among Erickson's 20 communities, eight are completed, 11 are open although in construction, and one is in development. They have 23,000 residents in total. LJVH HOLDINGS: S&P Puts 'B' Rating on CreditWatch Developing ------------------------------------------------------------ Standard & Poor's Ratings Services said it placed all of its ratings, including its 'B' long-term corporate credit rating, on LJVH Holdings Inc. (parent of Quebec-based gourmet coffee manufacturer and distributor Van Houtte Group Inc.) and its subsidiaries on CreditWatch with developing implications. Developing implications mean that S&P could be affirm, raise, or lower the ratings depending on the outcome of S&P's review. "This rating action follows the announcement of an executed Share Purchase Agreement by which Vermont-based Green Mountain Coffee Roasters Inc. will acquire all of LJVH Holdings' outstanding shares for a cash purchase price of US890 million," said Standard & Poor's credit analyst Lori Harris. "S&P expects the acquisition to close by the end of 2010, subject to certain approvals," Ms. Harris added. Should the transaction be completed, S&P believes that LJVH Holdings' debt will be repaid upon closing, at which time S&P will withdraw the ratings. S&P will keep the ratings on LJVH Holdings on CreditWatch with developing implications until the transaction is completed and the company's existing debt is repaid. Should the transaction be terminated, S&P will remove the ratings from CreditWatch. LODGE AT BIG SKY: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: The Lodge at Big Sky, LLC P.O. Box 160938 Big Sky, MT 59716-0938 Bankruptcy Case No.: 10-62229 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court District of Montana (Butte) Debtor's Counsel: James A. Patten, Esq. The Fratt Building, Suite 300 2817 2nd Avenue N Billings, MT 59101 Tel: (406) 252-8500 Fax: (406) 294-9500 E-mail: japatten@ppbglaw.com Estimated Assets: Not Stated Estimated Debts: $1,000,001 to $10,000,000 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- The Lodge at Big Sky Management 10-62230 09/14/10 Company LLC Estimated Assets: Not Stated Estimated Debts: $1,000,001 to $10,000,000 The Debtors did not file a list of creditors together with their petitions. The petitions were signed by Jeff Quackenbush, president. LUDIVINA NACIONALES: Case Summary & 16 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Ludivina Nacionales dba Beverly Hills Home Care 311 N. Doheny Drive Beverly Hills, CA 90211 Bankruptcy Case No.: 10-48837 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Richard M. Neiter Debtor's Counsel: Dennis E. Mcgoldrick, Esq. 350 S. Crenshaw Boulevard, Suite A207B Torrance, CA 90503 Tel: (310) 328-1001 E-mail: dmcgoldricklaw@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 16 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-48837.pdf LYM, LLC: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------ Debtor: LYM, LLC 1264 S. Waterman Avenue, #49 San Bernardino, CA 92408-2851 Bankruptcy Case No.: 10-39681 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Central District of California (Riverside) Judge: Catherine E. Bauer Debtor's Counsel: Kenneth D. Sisco, Esq. 4469 Pedley Avenue Norco, CA 92860 Tel: (714) 265-7766 Fax: (714) 265-7518 E-mail: siscobknotice@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-39681.pdf The petition was signed by Yaacov Limon, manager. MADISYN NORTHEAST: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Madisyn Northeast, LLC 4601 W. Walnut Street Soquel, CA 95073 Bankruptcy Case No.: 10-59531 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Northern District of California (San Jose) Judge: Arthur S. Weissbrodt Debtor's Counsel: Scott J. Sagaria, Esq. LAW OFFICES OF SCOTT J. SAGARIA 333 W. San Carlos Street, #1700 San Jose, CA 95110 Tel: (408) 279-2288 E-mail: sjsagaria@sagarialaw.com Scheduled Assets: $3,500,833 Scheduled Debts: $7,433,010 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-59531.pdf The petition was signed by Melissa Hall, managing member. MESA AIR: Asks for Approval of Employee Incentive Plan ------------------------------------------------------ Mesa Air Group Inc. and certain of its subsidiaries and affiliates, as debtors and debtors-in-possession, asks Judge Martin Glenn of the United States Bankruptcy Court for the Southern District of New York for authority to implement an employee incentive program and make payments to certain employees. To recall, on the Petition Date, the Debtors filed a motion to pay certain prepetition wages, compensation and employee benefits, among other things. The Court approved the wage and Benefit Motion on February 23, 2010. As part of the Wage and Benefit Motion, the Debtors originally sought authorization to continue their prepetition incentive program and make payments arising thereunder with respect to seven employees -- Brian S. Gillman, Paul Foley, David Butler, Keith Kranzow, Gary Appling, Michael Ferverda, and James Swigart. After discussions with the Official Committee of Unsecured Creditors, the Debtors agreed to exclude the request to pay the seven employees from the Wage Order and instead seek authority to pay any incentive payments to those seven employees pursuant to a separate motion. Accordingly, the Debtors engaged in discussions with the Creditors' Committee with respect to the proposed payments and have obtained the Creditors' Committee's support to this motion, John W. Lucas, Esq., at Pachulski Stang Ziehl & Jones LLP, in New York, relates. Before the Petition Date, the Debtors negotiated maximum target bonuses for each Eligible Employee that was determined by their individual employment responsibilities and experience. Eligible Employees can receive up to 100% of their target bonus based on their individual performance and the Debtors' performance, according to Mr. Lucas. A schedule of the break-down of the maximum bonus targets for each Eligible Employee and the payments proposed: Maximum for 2 Quarters Maximum (Jan-June Quarterly 2010) Since Bonus Filing --------- ----------- Brian Gillman, Exec VP-General Counsel $52,500 $105,000 Paul Foley, Chief Operating Office 20,000 40,000 David Butler, Sr. VP Admin I HR 15,000 30,000 Keith Kranzow, Vice President Finance 12,000 24,000 Gary Appling, Sr. VP-Technical Operations 12,000 24,000 Mike Ferverda, VP-Operations 20,000 40,000 James Swigart, Director of Finance 12,000 24,000 --------- ----------- Subtotal 143,500 287,000 Proposed Amount to be Distributed 100.0% Amount to be allocated for Interim Bonus 287,000 ----------- Amount to be Distributed (net) $287,000 By this motion, the Debtors ask for authority to pay the Eligible Employees their target bonus for two postpetition quarters -- for services rendered during the Debtors' second fiscal quarter beginning January 2010 through the end of the third fiscal quarter ending June 2010 -- based on their supervisors' determination that their performance and the Debtors' performance has met or exceeded expectations. According to Mr. Lucas, the Eligible Employees have tirelessly applied their unique skills, knowledge and experience, and have, as a result, maximized the value of the Debtors' estates for the benefit of all economic stakeholders in these cases. Mr. Lucas notes that the Eligible Employees have enabled the Debtors to maintain the high performance of their operations at the same or better levels that existed before entering Chapter 11. As an example, he cites the Debtors' code-share contract with US Airways, Inc., wherein, since the Petition Date through July 2010, the Debtors have maintained the same level of flight completion despite the additional considerations the Debtors and the Eligible Employees have been presented with during the course of these bankruptcy cases. In addition, since the Petition Date, the Debtors' financial performance has improved. The Eligible Employees have been able to achieve substantial overhead reductions on a per aircraft basis as compared to prepetition levels, Mr. Lucas says. He notes that these results were achieved through the prompt return of aircraft, securing aircraft equipment at reduced rates, and negotiating reduced rates for aircraft that was parked while the Debtors coordinated the return of dozens of aircraft that were no longer in revenue service. Furthermore, the efficient return of excess aircraft in the Debtors' fleet has also enabled the Debtors to select the aircraft they intend to retain, which led to the commencement of lease negotiations for the CRJ-200 and Dash-8 aircraft. The Eligible Employees have successfully negotiated forms of leases for the retained equipment on substantially better terms than the terms of the rejected leases, Mr. Lucas tells the Court. The Debtors submit that the proposed Incentive Plan, which provides for an aggregate payment of $143,500 per quarter to seven Eligible Employees, is a proper exercise of their business judgment because the Incentive Plan will appropriately compensate and reward the Eligible Employees for their extraordinary efforts on behalf of the Debtors' estates and their continuing obligations to remain available to the Debtors for consultation during the remainder of the Chapter 11 proceedings. The proposed payments are modest, given that they only range from $4,000 to $17,500 per month per Eligible Employee, Mr. Lucas notes. The Incentive Program is not prohibited by Section 503(c)(3) of the Bankruptcy Code, Mr. Lucas contends. The Incentive Program is not intended to "induce" anyone to "remain with the Debtors' business," in a manner different than any other component of their base compensation. Instead, the Incentive Program is intended to motivate the Eligible Employees to achieve performance goals in order to maximize the value of the Debtors' assets, Mr. Lucas tells the Court. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MESA AIR: Proposes to Enter Into Equipment Lease Agreements ----------------------------------------------------------- Pursuant to Sections 363(b) and 503(b) of the Bankruptcy Code and Rule 6004 of the Federal Rules of Bankruptcy Procedure, Mesa Air Group Inc. and its units ask the U.S. Bankruptcy Court for authority to enter into: (a) Three separate aircraft engine leases -- Group 1 Engine Leases -- with respect to certain General Electric aircraft engines, model: CF34-3B1 having manufacturer serial numbers 872093, 807409, and 807410, and one airframe lease agreement -- the Group 1 Airframe Lease -- with respect to a certain CRJ-200 airframe having U.S. Registration No. N715SF, with the applicable lessors. (b) Four separate aircraft engine leases -- the Group 2 Engine Leases -- with respect to certain General Electric aircraft engines, model: CF34-3B1 having manufacturer serial numbers 872621, 872633, 872661, and 872783, and two airframe leases -- Group 2 Airframe Leases -- with respect to two CRJ-200 airframes having U.S. Registration Nos. N75994 and N75995, with the applicable lessors. (c) Two separate aircraft engine leases -- the Group 3 Engine Leases -- with respect to certain General Electric aircraft engine, model: CF34-3B1 having manufacturer serial numbers 872519 and 872520, and one CRJ-200 airframe lease -- the Group 3 Airframe Lease -- with respect to an airframe having U.S. Registration No. N27318, with the applicable lessors. Debtor Mesa Air Group, Inc., also seeks authority to execute guarantee agreements unconditionally guaranteeing the obligation of Mesa Airlines, Inc., under each of the Aircraft Equipment Leases for the benefit of the applicable lessors under each of the Aircraft Equipment Leases. A chart of the Aircraft Equipment Leases is available at no charge at http://bankrupt.com/misc/Mesa_AirEqptLeasesAgr083110.pdf John W. Lucas, Esq., at Pachulski Stang Ziehl & Jones LLP, in New York, notes that as of August 31, 2010, the Debtors have filed 22 notices of rejection or abandonment with respect to 12 engines and 101 aircraft. As part of the economization of their fleet, the Debtors and various aircraft counterparties have engaged in discussions regarding their ongoing business relationships. The Debtors have identified certain aircraft engines and airframes as being a necessary component of their fleet and operations. The Debtors and the applicable lessors have agreed to the terms and conditions governing the Debtors' right to use the aircraft equipment subject to the Aircraft Equipment Leases. Mr. Lucas notes that the terms and conditions of the Aircraft Equipment Leases contain the same or substantially similar economic terms and conditions as the leases the Debtors obtained authorization to enter by the Court's July 8, 2010 Order. He adds that the terms of the Aircraft Equipment Leases are more favorable than the terms of the rejected leases that previously governed the Engines and Airframes. According to Mr. Lucas, the salient terms of the Aircraft Equipment Leases include: (a) The Aircraft Equipment Leases include market rates, which are significantly less than the prior rental rates for the equipment. (b) The term for each Aircraft Equipment Lease extends through March 31, 2013. (c) Mesa Airlines may terminate any Aircraft Equipment Lease (1) by providing four months' notice of termination or (2) in the event the related Engine becomes due for certain cycle-driven or performance-driven maintenance visits or an FAA airworthiness directive requires work to be performed on the related Airframe. (d) If Mesa Airlines invokes an early termination right as a result of the Engine maintenance thresholds, the lessors will have the option, but not the obligation, to lease another serviceable engine to the Debtor before the scheduled termination date. If the lessor elects this option, Mesa Airlines will be obligated to lease the new engine. (e) Mesa Airlines is required to make monthly payments for each Engine and Airframe in advance at the first of each month. (f) No security deposits or maintenance reserves will be payable by Mesa Airlines. (g) The Debtors are required to return the Engines and Airframes with a very low threshold of minimum hours/cycles remaining. (h) During the Aircraft Equipment Lease term, the applicable lessors will be permitted, upon advance notice to Mesa Airlines, to inspect the Engines, Airframes and all related maintenance records so long as the inspection does not unreasonably interfere with the Debtor's operation or maintenance of the Engines or Airframes. (i) Mesa Airlines will maintain, at its cost and expense, hull, liability and war risk insurance with coverage types and amounts as currently required by the rejected leases that previously governed the Engines and Airframes. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MESA AIR: To Assume Memphis-Shelby Airport Agreement ---------------------------------------------------- Mesa Airlines, Inc., received approval of a stipulation and agreement with Memphis-Shelby County Airport Authority to assume a certain Airport Operating Agreement, effective August 31, 2010. Mesa Airlines and Memphis-Shelby CAA are parties to a certain Landing, Common Use, Security and Federal Inspection Service (FIS) Facility Charge Agreement for Operations at Memphis International Airport, dated October 1, 2001, as amended -- Airport Operating Agreement. The deadline to assume or reject the Airport Operating Agreement expired August 31, 2010, pursuant to the Court's August 3, 2010 Order. The Debtor and Memphis-Shelby CAA agree that (i) no cure amounts are due under the Airport Operating Agreement pursuant to Section 365(b)(1)(A) of the Bankruptcy Code, and (ii) Mesa Airlines has provided adequate assurance of future performance under the Agreement pursuant to Section 365(b)(1)(C). The parties also agree that Mesa Airlines will pay in the ordinary course of business all undisputed amounts arising under the Airport Operating Agreement after August 31, 2010, and Memphis-Shelby CAA's and Mesa Airlines' rights with respect to any claims under the Agreement after August 31, 2010 are reserved. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MGIC INVESTMENT: S&P Puts 'C' Rating on Junior Subordinated Debt ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it placed its 'C' unsolicited rating on MGIC Investment Corp.'s convertible junior subordinated debt on CreditWatch with positive implications. The ratings on MTG's other issuances and on its operating companies are unchanged. Standard & Poor's had lowered its rating on this issue to 'C' after MTG announced it had opted to defer the interest payment that was scheduled for April 1, 2009. The company also deferred subsequent interest payments that were scheduled to be paid on Oct. 1, 2009, and April 1, 2010. When an issuer elects to exercise its option to defer interest, in accordance with its criteria, S&P lowers the rating on that obligation to 'C'. The company has since announced that it will use the proceeds from its April 2010 common stock offering to pay the $57.5 million in deferred interest payments, including the compound interest on each, on Oct. 1, 2010. MTG also indicated it will pay the $17.5 million interest payment scheduled for Oct. 1, 2010. S&P will resolve the CreditWatch status of the rating upon payment of the deferred interest on Oct. 1, 2010. Once the payment has occurred, S&P will raise the rating on the subordinated debt to 'CC'. Subsequently, the rating on the subordinated debt issue will generally change in tandem with the ratings on MTG and its operating subsidiaries. However, S&P will lower the rating on the subordinated debt offering back to 'C' if the company again opts to defer its interest payments. The outlook on MTG is negative, largely reflecting the current macroeconomic conditions as well as the increasing litigation risk associated with rescission activity. MICHAEL BERNARDINO: Case Summary & 17 Largest Unsecured Creditors ----------------------------------------------------------------- Joint Debtors: Michael L. Bernardino Minnie F. Bernardino 538 Foster Springs Road Las Vegas, NV 89148 Bankruptcy Case No.: 10-27425 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: C. Andrew Wariner, Esq. 823 Las Vegas Blvd. So, Suite 500 Las Vegas, NV 89101 Tel: (702) 953-0404 Fax: (702) 989-5388 E-mail: awariner@lvbklaw.com Scheduled Assets: $1,154,564 Scheduled Debts: $2,149,037 A list of the Joint Debtors' 17 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/nvb10-27425.pdf MIDWEST THEATRES: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Midwest Theatres Corporation dba Cinemagic Theatres 4300 O'Day Avenue NE St. Michael, MN 55376 Bankruptcy Case No.: 10-46834 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court District of Minnesota (Minneapolis) Judge: Nancy C. Dreher Debtor's Counsel: Michael F McGrath, Esq. RAVICH MEYER KIRKMAN & MCGRATH NAUMAN 4545 IDS Center 80 South Eighth Street Minneapolis, MN 55402 Tel: (612) 332-8511 E-mail: mfmcgrath@ravichmeyer.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 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/mnb10-46834.pdf The petition was signed by Bryan J. Sieve, chief financial officer. MORRIS CLARK: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Morris Shandell Clark 2870 N Speer Blvd # 103 Denver, CO 80211-4207 Bankruptcy Case No.: 10-33269 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Howard R. Tallman Debtor's Counsel: Harvey Sender, Esq. SENDER & WASSERMAN, P.C. 1660 Lincoln St., Suite 2200 Denver, CO 80264 Tel: (303) 296-1999 Fax: (303) 296-7600 E-mail: Sendertrustee@sendwass.com Scheduled Assets: $1,541,474 Scheduled Debts: $2,938,065 A list of the Debtor's 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cob10-33269.pdf MOVING SOLUTIONS: Case Summary & 4 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Moving Solutions LTD, LLC 45 Easy Street Simi Valley, CA 93065 Bankruptcy Case No.: 10-21589 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Central District of California (San Fernando Valley) Judge: Maureen Tighe Debtor's Counsel: Craig Wormley, Esq. 13101 Washington Boulevard, Suite 241 Los Angeles, CA 90066 Tel: (310) 914-2444 Scheduled Assets: $6,820,000 Scheduled Debts: $8,820,000 A list of the Company's four largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cacb10-21589.pdf The petition was signed by Michael Persky, manager. NEXAIRA WIRELESS: Posts $1.1MM Net Loss in October 31 Quarter ------------------------------------------------------------- Nexaira Wireless Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $1.1 million on $270,305 of revenue for the three months ended July 31, 2010, compared with a net loss of $922,769 on $845,956 of revenue for the same period ended July 31, 2009. Cash on hand as of July 31, 2010 was $53,039. As of July 31, 2010, the Company had a working capital deficiency of $3.1 million. The Company's balance sheet as of July 31, 2010, showed $1.8 million in total assets, $3.6 million in total liabilities, and a stockholders' deficit of $1.8 million. As reported in the Troubled Company Reporter on February 1, 2010, BDO Seidman, LLP, in San Diego, expressed substantial doubt about the Company's ability to continue as a going concern, following its results for the fiscal year ended October 31, 2009. The independent auditors noted of the Company's losses from operations, negative cash flow from operations, and working capital and net capital deficits. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6b34 About NexAira Wireless Headquartered in Vancouver, B.C., Nexaira Wireless Inc. (OTC BB: NXWI) -- http://www.nexaira.com/-- does business through its San Diego based operating subsidiary Nexaira, Inc. Nexaira, Inc., develops and delivers third and fourth generation (3G/4G) Wireless Routing Solutions that offer speed, reliability and security to carriers, mobile operators, service providers, value added resellers (VARS) and enterprise customers. NEXCEN BRANDS: Files Cert. of Dissolution in State of Delaware -------------------------------------------------------------- The Board of Directors of NexCen Brands Inc. resolved on Sept. 1, 2010, to file a certificate of dissolution of the Company to put the plan of complete dissolution and liquidation of the Company previously approved by the Company's stockholders into effect. On Sept. 13, 2010, the Company filed the Certificate of Dissolution with the Office of the Secretary of State of the State of Delaware and closed its stock transfer books, effective as of the close of business on the same day. About NexCen Brands Based in New York, NexCen Brands, Inc. (PINK SHEETS: NEXC.PK) -- http://www.nexcenbrands.com/-- was, prior to the completion of the sale of substantially all of the Company's assets (the "Asset Sale"), including its entire portfolio of franchised brands, to Global Franchise Group, LLC, on July 30, 2010, a strategic brand management company that owned and managed a portfolio of seven franchised brands, operating in a single business segment: Franchising. These brands included five QSR brands (Great American Cookies, Marble Slab Creamery, MaggieMoo's, Pretzel Time and Pretzelmaker) and two retail footwear and accessories brands (TAF and Shoebox New York). All seven franchised brands were managed by NexCen Franchise Management, Inc., a wholly owned subsidiary of NexCen. The Company's franchise network, across all of its brands, consisted of approximately 1,700 stores in 38 countries. NexCen's balance sheet at June 30, 2010, revealed $98.30 million in total assets, $150.05 million in total liabilities, and a stockholders' deficit of $51.75 million. On July 29, 2010, NexCen Brands Inc. closed the sale of its franchise businesses to Global Franchise Group, LLC, an affiliate of Levine Leichtman Capital Partners. Global acquired the subsidiaries of NexCen that own the franchise business assets for $112.5 million. NORM NOVITSKY: Case Summary & 11 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Norm Novitsky 26647 Alsace Drive Calabasas, CA 91302 Bankruptcy Case No.: 10-21590 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Central District of California (San Fernando Valley) Judge: Maureen Tighe Debtor's Counsel: Douglas M. Neistat, Esq. 16000 Ventura Boulevard, #1000 Encino, CA 91436 Tel: (818) 382-6200 Fax: (818) 986-6534 E-mail: twilliams@greenbass.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 11 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cacb10-21590.pdf OAKHURST REALTY: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Debtor: Oakhurst Realty, LLC dba Revel Co Incoakhurst dba Oakhurst Homes, LLC 7215 East 21st Street, Suite A Indianapolis, IN 46219 Bankruptcy Case No.: 10-13854 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court Southern District of Indiana (Indianapolis) Judge: Frank J. Otte Debtor's Counsel: James S. Kowalik, Esq. HOSTETLER AND KOWALIK, P.C. 101 W Ohio St., Suite 2100 Indianapolis, IN 46204 Tel: (317) 262-1001 Fax: (317) 262-1010 E-mail: jsk@hostetler-kowalik.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ The Huntington National $3,760,308 Bank 45 North Pennsylvania Street Suite 400 Indianapolis, IN 46204 The petition was signed by Ronald E. Farren, member. OAKVIEW HOMES: Case Summary & 8 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Oakview Homes, LLC 1300 Griffin Road Greenwood, AR 72936 Bankruptcy Case No.: 10-74830 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Western District of Arkansas (Fort Smith) Debtor's Counsel: Derrick Mark Davidson, Esq. DERRICK DAVIDSON, P.A. 3061 N. Market Avenue, Suite 8 Fayetteville, AR 72703 Tel: (479) 935-4100 Fax: (479) 856-6168 E-mail: derrick@davidsonbusinessattorney.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/arwb10-74830.pdf The petition was signed by Robert Griffin, manager. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Robert Griffin and Julia Griffin 10-73471 07/06/10 The Plantation, LLC 10-74742 09/08/10 ODYSSEY PROPERTIES: Files Schedules of Assets and Liabilities ------------------------------------------------------------- Paradise Shoppes at Apollo Beach, LLC, a debtor-affiliate of Odyssey Properties III, LLC, filed with U.S. Bankruptcy Court for the Middle District of Florida its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $15,000,000 B. Personal Property $30,076 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $12,828,860 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $614,327 ----------- ----------- TOTAL $15,030,076 $13,443,187 Odyssey Properties also disclosed $905,518 in assets and $39,707,087 in liabilities. Odyssey Properties Lakeland, Florida-based Odyssey Properties III, LLC, is engaged in the business of developing, owning, and operating commercial properties, including anchored and unanchored retail centers, office buildings, flex and warehouse space, and self-storage centers, primarily in central Florida. Odyssey Properties and certain affiliates filed for Chapter 11 protection on August 2, 2010 (Bankr. M.D. Fla. Case No. 10-18713). Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain & Prosser, PA, assists the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $10 million to $50 million as of the Petition Date. OSHKOSH CORP: S&P Assigns 'BB+' Rating on $1.2-Bil. Senior Loan --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' issue-level (two notches above the CCR) and a recovery rating of '1' to Oshkosh Corp.'s proposed $1.2 billion senior secured credit facility. At the same time, S&P raised its issue-level ratings on the company's senior unsecured debt to 'BB-' (the same as the corporate credit rating) from 'B+'. S&P also revised its recovery rating on this debt to '4' from '5'. S&P also affirmed Oshkosh's 'BB-' CCR. The outlook is positive. "The upgrade of Oshkosh's unsecured issue-level ratings reflects an expected lower level of term debt in the company's capital structure following completion of the proposed refinancing, which improves simulated recovery prospects for the unsecured noteholders," said Standard & Poor's credit analyst Dan Picciotto. "The CCR affirmation reflects S&P's continued expectation that performance at Oshkosh's industrial businesses will improve in the next year from very low activity levels, partially offsetting reduced sales and profitability at its defense segment in fiscal 2011. S&P expects credit measures to weaken from their very good current levels, but believe they will remain consistent with S&P's expectations for a higher rating if Oshkosh can perform well as it transitions away from its sizable mine-resistant, ambush- protected, all-terrain vehicle (M-ATV) program. Profitability is likely to decline significantly next year due to the substantial completion of this order, but S&P believes funds from operations will likely exceed 20% in fiscal 2011 and potentially improve thereafter." The CCR reflects Oshkosh's aggressive financial risk profile, which more than offsets its satisfactory business risk profile. The business risk profile is marked by leading positions in key segments of the cyclical specialty vehicle market and good product and end-market diversity. The outlook is positive. S&P believes Oshkosh could maintain credit measures adequate for a higher rating. "S&P could raise the ratings if S&P see industrial end markets improving next year as the defense segments' M-ATV-related profits decline, resulting in credit measures consistent with S&P's expectations, for instance, if the company appears likely to maintain credit measures of about 3.5x adjusted debt to EBITDA and 20% FFO to total adjusted debt. On the other hand, S&P could revise the outlook to stable if a double-dip recession or debt-financed acquisition results in weaker credit measures, for example, if the company makes only modest additional debt repayments, EBITDA declines approaches $400 million in 2011, and adjusted debt to EBITDA nears 4x," Mr. Picciotto added. OSMOTICS CORPORATION: Case Summary & Creditors List --------------------------------------------------- Debtor: Osmotics Corporation 1444 Wazee Street, Suite 210 Denver, CO 80202 Bankruptcy Case No.: 10-33198 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court District of Colorado (Denver) Judge: Sidney B. Brooks Debtor's Counsel: M. Frances Cetrulo, Esq. 370 17th Street, Suite 4800 Denver, CO 80202 Tel: (303) 825-0800 Fax: (303) 629-7610 E-mail: fcetrulo@bw-legal.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cob10-33198.pdf The petition was signed by Francine Porter, chief executive officer. P & K U.S.A.: Case Summary & 16 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: P & K U.S.A., Inc. dba Howard Johnson 33224 Hwy 27 S. Haines City, FL 33844 Bankruptcy Case No.: 10-22145 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Buddy D. Ford, Esq. BUDDY D. FORD, P.A. 115 N. MacDill Avenue Tampa, FL 33609-1521 Tel: (813) 877-4669 Fax: (813) 877-5543 E-mail: Buddy@tampaesq.com Scheduled Assets: $1,526,795 Scheduled Debts: $2,917,340 A list of the Company's 16 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/flmb10-22145.pdf The petition was signed by Chi K. Pak, president. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Pak, Chi K. & Kon S. PACIFIC RIM: Posts $1.2 Million Net Loss in July 31 Quarter ----------------------------------------------------------- Pacific Rim Mining Corporation reported a net loss of $1.2 million for the three months ended July 31, 2010, compared to a net loss of $881,000 for the same period ended July 31, 2009. The Company currently has no source of revenue. The increase in net loss, despite a reduction in exploration expenses, is primarily a result of increased costs related to the Company's CAFTA action, and a gain on the sale of bullion during Q1 2010 for which there was no comparable item during Q1 2011. The Company's balance sheet at July 31, 2010, showed $6.2 million in total assets, $3.1 million in total liabilities, and shareholders' equity of $3.1 million. The Company has a history of losses and may continue to incur losses for the foreseeable future. As at July 31, 2010, the Company has an accumulated deficit of $87.3 million. The Company will require additional funding to maintain its ongoing exploration programs and property commitments, for administrative purposes and Central America-Dominican Republic-United States of America Free Trade Agreement ("CAFTA") arbitration and negotiation. These legal costs for CAFTA are significant. These events and conditions cast substantial doubt about the Company's ability to continue as a going concern. A full-text copy of the Company's interim consolidated financial statements as of and for the three months ended July 31, 2010, is available for free at http://researcharchives.com/t/s?6b36 A full-text copy of the Company's Management Discussion and Analysis for the period ended July 31, 2010, is available for free at http://researcharchives.com/t/s?6b37 About Pacific Rim Mining Vancouver, Canada-based Pacific Rim Mining Corporation http://www.pacrim-mining.com-- is involved in the exploration and development of gold properties. The Company owns a 100% interest in certain mineral properties, known as El Dorado, located in El Salvador and carries out exploration activities in Costa Rica and Guatemala. Pacific Rim's shares trade under the symbol PMU on the Toronto Stock Exchange ("TSX") and on the Over the Counter QX ("OTCQX") market in the US under the symbol PFRMF. The Company has not yet confirmed whether any of its exploration properties contain mineral deposits that are economically recoverable. PALISADES MEDICAL: Moody's Keeps 'Ba2' Rating on $39.3-Mil. Bonds ----------------------------------------------------------------- Moody's Investors Service has affirmed the Ba2 long-term ratings assigned to Palisades Medical Center's $39.3 million of outstanding bonds. The outlook is revised to stable from negative reflecting the improvement in financial performance over the past two years. Legal Security: Gross receipts pledge of the obligated group, comprised of Palisades Medical Center and the Harborage (Palisades General Care, Inc.), a long term care provider on its campus. A mortgage of PMC and the Harborage is also provided as bondholder security. Bond covenants require 60 days cash on hand and a 1.2 times rate covenant measured annually. Interest Rate Derivatives: None Strengths * Improvement in operating performance in FY 2008 and FY 2009; operating cash flow margin reached 5.5% in FY 2009 from 5.3% in FY 2008 and denotes a good departure from weaker historical performance; results through the first half of FY 2009 show continued improvement * increase in admissions in FY 2009 for this small provider due to continued physician recruitment and the addition of new services following two years of declines * Harborage, the nursing home located adjacent to PMC, continues to be profitable and a larger contributor to operating income than the medical center * Successful negotiations with the unions which included favorable changes to the defined benefit pension plan that should limit future funding and more modest wage increases * All fixed rate debt structure with no derivatives; financial improvement created more headroom to the bond covenants in FY 2009 Challenges * Decline in unrestricted cash and investments as of December 31, 2009, to $24.9 million or 61 days cash on hand, down from $26.7 million or 68.6 days as of December 31, 2008 (Moody's excludes supplemental retirement funds although they are included in the days cash on hand calculation); average payment period is very high at 115.1 days as of December 31, 2009, suggesting that cash is somewhat inflated due to slower payments to vendors and future cash increases are limited as management endeavors to reduce the outstanding payables * Payer mix is skewed toward governmental (54% Medicare and 14% Medicaid) and self pay, limiting opportunities for cost shifting; long-standing absence of a Blue Cross contract viewed negatively as it is the largest commercial payer in northern New Jersey * Competitive northern New Jersey market although some of the nearby Hoboken hospitals are experiencing challenging financial pressures which may present volume opportunities for PMC; Moody's consider PMC to be a small hospital and nursing home system ($154 million in combined revenues) making it vulnerable to external changes * Admissions have softened during the first half of FY 2010 compared to the prior year period; material 8% decline in outpatient surgeries which reflects some reliance on a few key surgeons and large private physician group located on the PMC campus * While the pension funded ratio has improved (to 70% funded in FY 2009 from 49% in FY 2008) and concessions regarding pension structure were agreed upon by the unions, it remains a long-term obligation of PMC Recent Developments/Results The Ba2 rating affirmation and the revision of the outlook to stable from negative reflect the improvement in financial performance over the past two years. In fiscal year 2009, operating cash flow reached $8.5 million, up from $7.8 million in FY 2008 and a much weaker $3.0 million in FY 2007. Correspondingly, the operating cash flow margin improved to a better, although still below average 5.5% in FY 2009, up from 5.3% in FY 2008 and 2.1% in FY 2007. (Moody's excludes all investment income from these computations.) Performance through the first half of FY 2010 ending June 30, 2010 is encouraging with a 6.6% operating cash margin, although bondholders should note that PMC experiences some seasonality of volumes throughout the year. Notwithstanding, management is budgeting another year of improvement for FY 2010. The improvement in performance over the past two years is due to a myriad of factors including a) slight increase in FY 2009 admissions (0.7%) over FY 2008 and a large 14.2% increase in total surgeries; b) physician recruitment and some new services such as bariatric surgery; c) improved coding effort and a material reduction in length of stay; d) FTE reductions; e) favorable changes to health benefits and the pension plan (discussed further below); and f) favorable managed care negotiations. A new designation by the New Jersey Department of Health as a Tier 1 essential hospital qualified PMC for an increase of $1 million in charity care funding which also contributed to the improvement in the past two years. As a result of these efforts, revenues increased 5.1% in FY 2009 over FY 2008 after less than 2% growth in FY 2008 over FY 2007. Revenue growth also outpaced expense growth of 4.8% in FY 2009 over FY 2008. As a result of the improved operations, debt coverage levels improved in FY 2009 with debt to cash flow declining to 5.51 times from 6.78 times in FY 2008 and MADS coverage increasing to 2.35 times from 2.11 times, respectively. PMC's unrestricted cash and investment position decreased to $24.9 million or 61.1 days cash at FY end 2009, down slightly from $26.7 million or 68.6 days at the end of FY 2008. Moody's computation excludes $8.2 million of employee deferred compensation plans and supplemental executive retirement plans in FY 2009. However, PMC is allowed to include these funds in the computation of days cash on hand. When doing so, management reports that days cash on hand increased to 78 days at the end of FY 2009, more comfortably distant from the 60 days cash on hand covenant and is another contributing factor the removal of the negative outlook. A return to days cash on hand that is much closer to the 60 days cash on hand covenant will result in reconsideration of the outlook. Moody's does not expect to see material growth in the absolute amount of liquidity as management is endeavoring to reduce the accounts payable outstanding. At the end of FY 2009, days in accounts payable reached 115 days, very unfavorable to the national median of 57 days. Prior financial management stretched payables as a means to maintain cash on the balance sheet and the current chief financial officer's goal is to reduce the number to 75 days. Future capital may increase as well, although some funding to come from a federal grant and a new capital lease. The capital budget for FY 2010 is $10.7 million to be funded over the next two to three years. PMC is a unionized hospital and management was able to negotiate favorable structural changes to the pension plan in recent negotiations. The changes include these: a) all benefits earned through December 31, 2009 will be frozen and compensation will not be inflated from December 31, 2009 through retirement; b) a pension accrual moratorium for 1.5 years and c) the multiplier for certain benefits was reduced to 1.4 times from 1.5 times. As a result, management saw a nearly $2 million reduction in pension expense in FY 2009 and a $3.7 million reduction in FY 2010. Funding will decline $2.8 million in FY 2010 to $6.9 million, compared to the $9.7 million that would have been needed had the changes not been made. These changes are material and should help preserve the balance sheet in the next two years. Both management and the unions agreed to not revisit the pension for another four years. While financial performance has improved, PMC faces challenges as a small provider in a competitive market. There are numerous competing providers in Hudson County as well as nearby Bergen County. Management reports that some of the other Hoboken area hospitals are struggling financially and are seeking merger or capital partners, which could present additional competitive challenges for the organization. Likewise, outmigration to New York City and Bergen County providers remains a challenge. Medicaid shows continued growth to 14.9% in FY 2009 from 12.0% in FY 2007 while self pay represents 12.8% in FY 2009, both above the national medians of 11.0% and 7.0%, respectively. Outlook The stable outlook reflects Moody's expectation that performance over the next two years should provide adequate debt service coverage. Comfortable headroom away from the 60 days cash on hand covenant is also a factor for the stable outlook. What could change the rating -- Up Significant improvement in liquidity measures and continued trend of profitable operating performance; enterprise growth as measured by volumes and revenues What could change the rating -- Down Additional debt, further reduction in cash, decline in operating performance, decline in patient volumes, downturn in performance at the Harborage; wide-sweeping changes to the competitive landscape that would impair performance Key Indicators Assumptions & Adjustments: -- Based on financial statements for Palisades Medical Center, Inc. and Palisades General Care, Inc. -- First number reflects audit year ended December 31, 2008 -- Second number reflects audit year ended December 31, 2009 -- Investment returns normalized at 6% unless otherwise noted -- All investment returns restated as non-operating income -- Moody's excludes supplemental retirement funds from cash calculations * Inpatient admissions: 9,306; 9,425 * Total operating revenues: $147.3 million; $154.8 million * Moody's-adjusted net revenue available for debt service: $9.4 million; $10.5 million * Total debt outstanding: $46.1 million; $43.7 million * Maximum annual debt service: $4.5 million; $4.5 million * Moody's-adjusted MADS Coverage with normalized investment income: 2.11 times; 2.35 times * Debt-to-cash flow: 6.8 times; 5.5 times * Days cash on hand: 68.6 days; 61.1 days * Cash-to-debt: 57.9%; 57.0% * Operating margin: -0.3%; 0.4% * Operating cash flow margin: 5.3%; 5.5% Outstanding Bonds (as of December 31, 2009): -- Series 1999: $11.3 million outstanding; Ba2 -- Series 2002: $28.0 million outstanding; Ba2 The last rating action with respect to PMC was on August 13, 2009, when the Ba2 municipal finance scale rating was affirmed and the outlook was negative. That rating was subsequently recalibrated to Ba2 on May 7, 2010. PEBBLE PAGE: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Pebble Page, Inc. dba Stevie Tomato's Sports Page 2430 Vanderbilt Beach Rd. #108-179 Naples, FL 34109 Bankruptcy Case No.: 10-22022 Chapter 11 Petition Date: September 13, 2010 Court: United States Bankruptcy Court Middle District of Florida (Ft. Myers) Debtor's Counsel: Stephen R. Leslie, Esq. STICHTER, RIEDEL, BLAIN & PROSSER 110 East Madison Street, Suite 200 Tampa, FL 33602-4700 Tel:(813) 229-0144 E-mail: sleslie.ecf@srbp.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Wendy L. Luckey, secretary. R. JONATHAN KAPLAN: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: R. Jonathan Kaplan aka Richard Jonathan Kaplan 5045 Oxford Drive Sarasota, FL 34242 Bankruptcy Case No.: 10-22110 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Melody D. Genson, Esq. MELODY D. GENSON, PA 2750 Ringling Boulevard, Suite 3 Sarasota, FL 34237 Tel: (941) 365-5870 Fax: (941) 365-5872 E-mail: melodydgenson@verizon.net Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/flmb10-22110.pdf RIVIERA MARINE: Hearing on Chapter 15 Petition on October 8 ----------------------------------------------------------- U.S. Judge Caryl E. Delano of the U.S. Bankruptcy Court in Tampa, Fla., will determine next month whether to grant Riviera Marine (Int.) Pty. Ltd., bankruptcy protection in the U.S., Dow Jones' DBR Small-Cap reports. Judge Delano is scheduled to consider Riviera Marine's Chapter 15 bankruptcy petition at a hearing on October 8, 2010. Dow Jones reports that Stephen James Parbery, the foreign representative for the Company, said in court papers September 8, 2010, that Riviera Marine sold 327 boats with sales totaling $265 million for the financial year ending June 30, 2008. However, since then a global credit crisis and other factors hampered the number of boats the company has been able to sell. Riviera Marine only sold 52 boats with sales of $54 million for the financial year ending June 30, 2010. About Riviera Group Riviera Group -- http://www.riviera.com.au/--is a luxury boat builder based in Queensland, Australia. Riviera Group was placed into voluntary receivership in May 2009. Deloitte partners Chris Campbell, Vaughan Strawbridge and Richard Hughes were appointed receivers and managers of Riviera. According to the Brisbane Times, Mr. Campbell said it was proposed to sell Riviera as a going concern after a restructuring of the company. The Brisbane Times said Riviera shed 117 of its Gold Coast staff in January 2009 and cut more than 300 staff from its Coomera headquarters in 2008. The company also closed its production line for three weeks, from April 10 to May 5, in a bid to clear stock held by international dealers, the Brisbane Times added. In July 2010, Riviera Group said it has received written notice on June 25, 2010, that the Deed of Company Arrangement established in conjunction with Riviera's creditors in January this year has now been completed and the company has now officially exited from administration. Riviera Marine (Int.) Pty Ltd., part of a group of Australian companies that manufacture and sell luxury boats, sought bankruptcy protection in the U.S. (Bankr. M.D. Fla. Case No. 10-21722). The Company estimated assets and debt of as much as $50 million each in the Chapter 15 petition. Four affiliates also sought protection. Daniel C. Guarnieri, Esq., at Nelson Hesse, LLP, in Sarasota, Florida, serves as counsel to Stephen James Parbery, foreign representative of Riviera. RM STONEGATE: Case Summary & 4 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: RM Stonegate Investments, L.P. 1211 E. 15th St. Plano, TX 75074 Bankruptcy Case No.: 10-33223 Chapter 11 Petition Date: September 13, 2010 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Elizabeth E. Brown Debtor's Counsel: David M. Rich, Esq. ONSAGER, STAELIN & GUYERSON, LLC 1873 S. Bellaire St., Suite 1401 Denver, CO 80222 Tel: (303) 512-1123 E-mail: dmrich@comcast.net Scheduled Assets: $1,142,012 Scheduled Debts: $1,016,357 A list of the Company's four largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/cob10-33223.pdf The petition was signed by Randy Edwards, manager. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Stonegate Sundance Partners, LLC 10-33214 09/13/10 RMAA REAL ESTATE: Involuntary Chapter 11 Case Summary ----------------------------------------------------- Alleged Debtor: RMAA Real Estate Holdings, LLC 20702 Crescent Pointe Place Ashburn, VA 20147 Bankruptcy Case No.: 10-17701 Involuntary Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Eastern District of Virginia (Alexandria) Judge: Robert G. Mayer Debtor's Counsel: Pro Se Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Socrates Torres Breach of Contract $15,470 401 N. Armistead, Apartment 404 Alexandria, VA 22312 ROBERT GRIFFIN: 10 Affiliates' Chapter 11 Case Summary ------------------------------------------------------ Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Sabram Estates, LLC 10-74847 09/15/10 Silver Leaf West, LLC 10-74850 09/15/10 Trinity Estates, LLC 10-74858 09/15/10 Silver Leaf East, LLC 10-74860 09/15/10 Oakview Homes, LLC 10-74830 09/14/10 Iron Tree Homes, Inc 10-74832 09/14/10 Fairview Construction Co., LLC 10-74834 09/14/10 Corinthian Court, LLC 10-74837 09/14/10 O L Frisco, LLC 10-74838 09/14/10 The Plantation, LLC 10-74742 09/08/10 Court: U.S. Bankruptcy Court Western District of Arkansas (Fort Smith) Debtor's Counsel: Derrick Mark Davidson, Esq. DERRICK DAVIDSON, P.A. 3061 N. Market Avenue, Suite 8 Fayetteville, AR 72703 Tel: (479) 935-4100 Fax: (479) 856-6168 E-mail: derrick@davidsonbusinessattorney.com The September 15 Debtors estimated $1 million to $10 million in assets and debts in their respective Chapter 11 petitions. A list of Sabram's three largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/arwb10-74847.pdf A list of Silver Leaf East's three largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/arwb10-74860.pdf A list of Silver Leaf West's five largest unsecured creditors, filed together with the petition is available for free at http://bankrupt.com/misc/arwb10-74850.pdf A list of Trinity Estate's three largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/arwb10-74858.pdf The petitions were signed by Robert Griffin, manager. Greenwood, Arkansas-based Robert and Julia Griffin filed for Chapter 11 bankruptcy protection (Bankr. W.D. Ark. Case No. 10- 73471) on July 6, 2010. Derrick Mark Davidson, Esq., in Fayetteville, Arkansas, serves as the Debtors' restructuring counsel. In their schedules filed in court, the Griffins reported $36,043,561 in total assets and $17,140,998 in total liabilities. ROBINO-BAY COURT: Taps Ciardi to Handle Reorganization Case ----------------------------------------------------------- Robino-Bay Court Plaza, LLC, and Robino-Bay Court Pad, LLC, ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Ciardi Ciardi & Astin as counsel. Ciardi will, among other things: -- provide legal advice with respect to the Debtors' powers and duties as debtors-in-possession in the continued operation of their business and management of their property; -- negotiate, prepare and pursue confirmation of a plan and approval of a disclosure statement; and -- prepare on behalf of the Debtors necessary motions, applications, answers, orders, reports, and other legal papers in connection with the administration of the Debtors' estates. To the best of the Debtors' knowledge, Ciardi is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Robino-Bay Court Plaza Wilmington, Delaware-based Robino-Bay Court Plaza, LLC, filed for Chapter 11 bankruptcy protection on July 28, 2010 (Bankr. D. Del. Case No. 10-12376). The Debtor is represented by John D. McLaughlin, Jr., Esq., at Ciardi Ciardi & Astin. The Debtor estimated its assets and debts at $10 million to $50 million in its Chapter 11 petition. An affiliate, Robino-Bay Court Pad, LLC, filed a separate Chapter 11 petition on July 28, 2010 (Case No. 10-12377), estimating its assets at $500,001 to $1 million and debts at $1 million to $10 million as of the Petition Date. ROBINO-BAY COURT: U.S. Trustee Unable to Form Creditors Committee ----------------------------------------------------------------- The U.S. Trustee for Region 3 notified the U.S. Bankruptcy Court for the District of Delaware that he was unable to appoint an official committee of unsecured creditors in the Chapter 11 cases of Robino-Bay Court Plaza, LLC, and Robino-Bay Court Pad, LLC. The U.S. Trustee explained that there were insufficient indications of willingness from the unsecured creditors to serve in the committee. Wilmington, Delaware-based Robino-Bay Court Plaza, LLC, filed for Chapter 11 bankruptcy protection on July 28, 2010 (Bankr. D. Del. Case No. 10-12376). The Debtor is represented by John D. McLaughlin, Jr., Esq., at Ciardi Ciardi & Astin. The Debtor estimated its assets and debts at $10 million to $50 million in its Chapter 11 petition. An affiliate, Robino-Bay Court Pad, LLC, filed a separate Chapter 11 petition on July 28, 2010 (Case No. 10-12377), estimating its assets at $500,001 to $1 million and debts at $1 million to $10 million as of the Petition Date. SCHUTT SPORTS: Riddell Inc. Wants to Pursue Lawsuit --------------------------------------------------- Athletic-gear manufacturer Riddell Inc. is urging the bankruptcy court to lift the automatic stay to allow it to go after rival Schutt Sports Inc. for selling football helmets that have been found to violate Riddell's patents, Dow Jones' DBR Small-Cap reports. Absent modification of the automatic stay, Riddell is prohibited from taking action against its rival. "The Bankruptcy Code should not be used to permit Schutt to continue its infringing conduct," the report quoted Riddell Inc. as saying. The report notes that Riddell Inc. filed a lawsuit in 2008 against Schutt Sports, its chief competitor in the football-helmet market, claiming that Schutt's most successful products - the DNA and ION model football helmets - infringed on Riddell's patents. Although Schutt Sports denied the allegation, a judgment awarding Riddell Inc. US$29 million was entered on August 18, 2010, the report adds. About Schutt Sports Litchfield, Illinois-based Schutt Sports, Inc. -- fka Schutt Manufacturing Company; aka Schutt Sports Manufacturing Co., Schutt Sports Distribution Company, and Schutt Athletic Sales Company -- designs, manufactures, distributes and markets team sporting goods equipment, offering an extensive line of football, baseball and softball protective gear and complementary accessories. Schutt Sports filed for Chapter 11 bankruptcy protection on September 6, 2010 (Bankr. D. Del. Case No. 10-12795). Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, assists the Debtor in its restructuring effort. Ernst & Young is the Debtor's financial advisor. Oppenheimer & Co., Inc., is the Debtor's investment banker. The Debtor estimated its assets and debts at $50 million to $100 million. Affiliates Circle System Group, Inc. (Bankr. D. Del. Case No. 10- 12796), Melas, Inc. (Bankr. D. Del. Case No. 10-12797), Mountain View Investment Co. of Illinois (Bankr. D. Del. Case No. 10- 12794), R.D.H. Enterprises, Inc. (Bankr. D. Del. Case No. 10- 12798), and Triangle Sports, Inc. (Bankr. D. Del. Case No. 10- 12799) filed separate Chapter 11 petitions on September 6, 2010. SCHUTT SPORTS: DIP Financing, Cash Collateral Use Gets Interim Nod ------------------------------------------------------------------ Schutt Sports, Inc., et al., sought and obtained authorization from the U.S. Bankruptcy Court for the District of Delaware to obtain postpetition secured financing from Bank of America, N.A., as agent and first-lien lender, and to use cash collateral. The DIP Lender have committed to provide up to $34,000,000. Amounts available under the DIP loan will be subject to the budget, a copy of which is available for free at: http://bankrupt.com/misc/SCHUTT_SPORTS_budget.pdf Victoria W. Counihan, Esq., at Greenberg Traurig, LLP, explained that the Debtors need the money to fund their Chapter 11 case, pay suppliers and other parties. The Lender has agreed to provide credit support for a sale/recapitalization process. Copies of the DIP financing agreement are available for free at: http://bankrupt.com/misc/SCHUTT_SPORTS_dipfinancingpact1.pdf http://bankrupt.com/misc/SCHUTT_SPORTS_dipfinancingpact2.pdf http://bankrupt.com/misc/SCHUTT_SPORTS_dipfinancingpact3.pdf The DIP facility will incur interest at 4.25%, payable monthly in arrears on the first day of each month. In the event of default, the Debtors will pay an additional 2% default interest, payable monthly in arrears on the first day of each month. The Debtors will grant the Lender valid and perfected first liens subject to the prior claims, on present and after-acquired personal and real property of the Debtors. The Lender will also be granted n allowed superpriority administrative expense claims for the DIP loan. The DIP lien is subject to a carveout for U.S. Trustee and Clerk of Court fees; up to $100,000 in fees payable to professional employed in the Debtors' case; and up to $50,000 in fees of the committee in pursuing actions challenging the DIP Lender' lien. By November 12, 2010, the Debtors must, among other things have either (i) entered into a binding agreement for a sale transaction with a stalking horse purchaser, on terms and conditions acceptable to the Lender in its sole discretion, with a purchase price that is sufficient to generate net sale proceeds of at least $250,000 in excess of (x) the secured indebtedness as of the closing of the sale and (y) the accrued administrative expenses, as of the closing of the sale, and filed with the Court a corresponding motion for approval of bidding procedures and the protections (if any) set forth in a stalking horse agreement on a proposed sale of the Debtors' assets or (ii) entered into a binding agreement for the recapitalization of the Debtors' existing business structuring, including binding commitments for any related financing. The Debtors are required to pay a host of fees to the Lender, including (i) a 1% closing fee, which will be fully earned on the date hereof, non-refundable and payable on the date of entry of the final court order, and (b) a $10,000 servicing fee, payable each month in advance, and non-refundable. The Lender' willingness to extend the DIP financing will terminate on, among other things, (i) the termination of the stalking horse agreement, unless the Debtors and a purchaser have at such time executed a binding contract for an acceptable sale transaction; on the DIP financing request isn't yet entered by such date; (iii) the date of final indefeasible payment and satisfaction in full in cash of the secured indebtedness; (iv) the effective date of any confirmed plan of reorganization in any or all of the Chapter 11 cases; and (v) December 31, 2010. The Debtors will also use cash collateral to provide additional liquidity. In exchange for using cash collateral, the Debtors grant the Lender adequate protection in the form of, among other things, replacement liens, superpriority claims, and adequate protection payments. The Court has set a final hearing for September 22, 2010, at 11:30 a.m. on the Debtors' request to obtain DIP financing. The Lender is represented by Latham & Watkins lLP. About Schutt Sports Litchfield, Illinois-based Schutt Sports, Inc. -- fka Schutt Manufacturing Company; aka Schutt Sports Manufacturing Co., Schutt Sports Distribution Company, and Schutt Athletic Sales Company -- designs, manufactures, distributes and markets team sporting goods equipment, offering an extensive line of football, baseball and softball protective gear and complementary accessories. Schutt Sports filed for Chapter 11 bankruptcy protection on September 6, 2010 (Bankr. D. Del. Case No. 10-12795). Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, assists the Debtor in its restructuring effort. Ernst & Young is the Debtor's financial advisor. Oppenheimer & Co., Inc., is the Debtor's investment banker. Logan & Company, Inc., is the Debtor's claims, noticing and balloting agent. The Debtor estimated its assets and debts at $50 million to $100 million. Affiliates Circle System Group, Inc. (Bankr. D. Del. Case No. 10- 12796), Melas, Inc. (Bankr. D. Del. Case No. 10-12797), Mountain View Investment Co. of Illinois (Bankr. D. Del. Case No. 10- 12794), R.D.H. Enterprises, Inc. (Bankr. D. Del. Case No. 10- 12798), and Triangle Sports, Inc. (Bankr. D. Del. Case No. 10- 12799) filed separate Chapter 11 petitions on September 6, 2010. SONOMA VINEYARDS: Court Extends Filing of Schedules Until Oct. 4 ---------------------------------------------------------------- The Hon. Alan Jaroslovsky of the U.S. Bankruptcy Court for the Northern District of California extended, at the behest of Sonoma Vineyards Estate, LLC, the deadline for the filing of its schedules of assets and liabilities to October 4, 2010. The deadline for the filing of the documents required in the Debtor's bankruptcy case was initially September 7, 2010. Napa, California-based Sonoma Vineyard Estates LLC filed for Chapter 11 bankruptcy protection on September 7, 2010 (Bankr. N.D. Calif. Case No. 10-13447). Michael C. Fallon, Esq., at the Law Offices of Michael C. Fallon, assists the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. SONOMA VINEYARD: Section 341(a) Meeting Scheduled for Oct. 1 ------------------------------------------------------------ The U.S. Trustee for Region 17 will convene a meeting of Sonoma Vineyard Estates LLC's creditors on October 1, 2010, at 1:30 p.m. The meeting will be held at the Office of the U.S. Trustee, 777 Sonoma Ave. #116, Santa Rosa, CA 95404. 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. Napa, California-based Sonoma Vineyard Estates LLC filed for Chapter 11 bankruptcy protection on September 7, 2010 (Bankr. N.D. Calif. Case No. 10-13447). Michael C. Fallon, Esq., at the Law Offices of Michael C. Fallon, assists the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. SOUTH TAHOE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: South Tahoe Area Transit Authority P.O. Box 10600 Stateline, NV 89449 Bankruptcy Case No.: 10-53666 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court District of Nevada (Reno) Judge: Gregg W. Zive Debtor's Counsel: Jeffrey L. Hartman, Esq. HARTMAN & HARTMAN 510 West Plumb Lane, Suite B Reno, NV 89509 Tel: (775) 324-2800 Fax: (775) 324-1818 E-mail: notices@bankruptcyreno.com Scheduled Assets: $394,369 Scheduled Debts: $3,585,585 The petition was signed by Nancy McDermid, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ MV Transportation, Inc.-Operations -- $2,293,597 P.O. Box 39000 San Francisco, CA 94139 MV Transportation, Inc. -- $825,000 P.O. Box 39000 San Francisco, CA 94139 Tahoe Regional Planning Agency -- $137,585 P.O. Box 5310 Stateline, NV 89449 Transit Resource Center of Nevada -- $60,114 Western Energetix, LLC -- $49,333 Feldman, Shaw & McLaughlin, LLP -- $23,956 SEFAC, Inc. -- $16,000 Myers Tire Supply Dist. Inc. -- $15,447 C.G. Uhlenberg LLP -- $14,000 A-Z Bus Sales, Inc. -- $11,644 The Ridge Tahoe Property Owners -- $10,000 Association El Dorado County -- $10,000 City Of South Lake Tahoe -- $10,000 Lakeside Inn and Casino -- $10,000 Lake Tahoe Casino Realty I -- $10,000 Douglas County -- $10,000 Vail Resorts, Inc. -- $10,000 Tahoe Regional Planning Agency -- $10,000 Tahoe Transportation District -- $10,000 Harveys Tahoe Management Co., Inc. -- $10,000 STATES INDUSTRIES: Taps Ball Janik as Bankruptcy Counsel -------------------------------------------------------- States Industries, Inc., asks for authorization from the U.S. Bankruptcy Court for the District of Oregon to employ Ball Janik LLP as bankruptcy counsel. Ball Janik will, among other things: a. prepare applications, motions, memoranda, responses, complaints, answers, orders, notices, reports, and other papers required from the Debtor as debtor and debtor-in- possession in connection with administration of this case; b. take actions necessary to protect and preserve the Debtor's bankruptcy estate, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtor, negotiations concerning all litigation in which the Debtor is involved, objections to claims filed against the Debtor in this bankruptcy case, and the compromise or settlement of claims; c. negotiate with creditors concerning a plan of reorganization, to prepare the plan of reorganization, disclosure statement and related documents, and to take the steps necessary to confirm and implement the plan of reorganization, including, if needed, negotiations for financing the plan; and d. represent the Debtor in all other aspects of the Debtor's Chapter 11 case. The hourly rates of Ball Janik's personnel are: Brad T. Summers, Partner $450 David W. Criswell, Partner $425 Justin D. Leonard, Associate $275 Mathew W. Lauritsen, Associate $225 Thorkild G. Tingey, Associate $175 Brad T. Summers, Esq., an attorney at Ball Janik, assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Eugene, Oregon-based States Industries, Inc., filed for Chapter 11 bankruptcy protection on August 24, 2010 (Bankr. D. Ore. Case No. 10-65148). According to its schedules, the Debtor disclosed $20,615,286 in total assets and $28,458,541 in total liabilities as of the petition date. STATES INDUSTRIES: Wants to Hire Inverness as Financial Advisor --------------------------------------------------------------- States Industries, Inc., asks for authorization from the U.S. Bankruptcy Court for the District of Oregon to employ Inverness Group LLC as financial advisor and its principal John Davidson as chief restructuring officer. Inverness and Mr. Davidson will, among other things: a. review and analyze the Debtor's business, operations and financial projections; b. evaluate the Debtor's potential debt capacity in light of its projected cash flows; c. assist in the determination of a capital structure for the Debtor; and d. determine a range of values for the Debtor on a going concern basis or for particular assets. The hourly rates of Inverness' personnel are: Managing Partner $305-$395 Managers $175-$195 Administrative & Paraprofessionals $120-$160 John Davidson, as CRO $325 Mr. Davidson assures the Court that Inverness is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Eugene, Oregon-based States Industries, Inc., filed for Chapter 11 bankruptcy protection on August 24, 2010 (Bankr. D. Ore. Case No. 10-65148). Brad T. Summers, Esq., and Justin D. Leonard, Esq., who have an office in Portland, Oregon, assist the Debtor in its restructuring effort. According to its schedules, the Debtor disclosed $20,615,286 in total assets and $28,458,541 in total liabilities as of the petition date. STONEGATE SUNDANCE: Case Summary & 10 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Stonegate Sundance Partners, LLC 1211 East 15th Street Plano, TX 75074 Bankruptcy Case No.: 10-33214 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court District of Colorado (Denver) Judge: A. Bruce Campbell Debtor's Counsel: Garry R. Appel, Esq. 1917 Market Street, Suite A Denver, CO 80202 Tel: (303) 297-9800 E-mail: appelg@appellucas.com Scheduled Assets: $3,290,537 Scheduled Debts: $1,836,380 A list of the Company's 10 largest unsecured creditors, filed together with the petition is available, for free at http://bankrupt.com/misc/cob10-33214.pdf The petition was signed by Randy Edwards, manager. SWIFT TRANSPORTATION: Moody's Affirms 'Caa1' Corp. Family Rating ---------------------------------------------------------------- Moody's Investors Service has affirmed the ratings of Swift Transportation Co., LLC's, corporate family rating of Caa1, and has raised Swift's ratings outlook to positive from negative. Swift's rating outlook was changed to positive in recognition of the company's strengthening financial performance, which Moody's attributes to improvements in Swifts trucking operations as well as to an improving trend in industry freight volumes and yields that are now taking traction. Throughout the recent trucking recession, Swift remained profitable at the operating income level, but had overall weak financial metrics due to its extremely high debt load following the 2007 transaction taking the company private. As industry conditions improve, Swift will be able to expand operating margins, which will be important to generate cash to support fleet investments and debt service. This also alleviates a key concern that Moody's had regarding potential tightness to financial covenants in Swift's credit facilities. Moreover, Swift's recent announcement of a planned initial public stock offering suggests the potential for substantial de- leveraging through debt repayment from equity issuance. Despite the improving operating environment, Swift's Caa1 rating continues to reflect sizeable debt levels resident in the company's current capital structure. With almost $3 billion of debt (including Moody's standard adjustments), which represents about 110% of revenue, Swift's credit metrics remain appropriate for the current rating. Debt to EBITDA, at less than 6 times, maps to the B3/Caa1 range, but relative to cash flow, leverage appears weaker: Retained Cash Flow to Debt of less than 6% is more appropriate for Caa1 rated entities. Interest coverage is particularly weak, largely the result of high interest costs inherent in the current debt structure (over $500 million of 12.5% second lien notes in particular). EBIT to Interest persistently below 1.0 time (0.6 times as of LTM June 2010) continues to be a constraining factor to higher rating consideration. Unless Swift makes substantial changes to its capital structure, Moody's expects only small improvements to credit metrics going forward. Ratings can be revised upward if, as the result of material debt repayment though use of IPO proceeds, the company substantially de-leverages its capital structure. Pro forma Retained Cash Flow to Debt of over 10% and EBIT to Interest of over 1.0 time will be supportive of a B3 rating. Ratings could instead be stabilized at Caa1 if proceeds from the IPO are not used to retire enough debt to effect deleveraging and improving interest coverage. Swift's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) Moody's projections of the company's performance over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Swift's core industry and Swift's ratings are believed to be comparable to those of other issuers of similar credit risk. The last rating action was on December 3, 2008, when Moody's lowered Swift's corporate family rating to Caa1. Swift Transportation Co, LLC, headquartered in Phoenix, Arizona, is one of the largest providers of truckload transportation services in the United States, with line-haul, dedicated and inter-modal freight services. TRADE SECRET: Blocks Bid to Remove CEO, Wins Sale Approval ---------------------------------------------------------- Dow Jones' DBR Small-Cap reports that Trade Secret Inc. successfully deflected a bid to have its chief executive replaced by an outsider and simultaneously won court approval to sell its assets to a group that includes that executive. About Trade Secret Premier Salons Beauty Inc., Trade Secret Inc., and six affiliates filed for bankruptcy protection on July 6 (Bankr. D. Del. Lead Case No. 10-12153). The Chapter 11 petitions of Premier Salons and Trade Secret each estimated assets of up to $50,000 and debts of up to $50 million. Trade Secret and its affiliates currently own and operate approximately 612 retail and salon locations in shopping malls and strip centers throughout the United States and Puerto Rico, on a collective basis. The Trade Secret Group consists of stores operating primarily under four trade names: Trade Secret, Beauty Express, BeautyFirst, and PureBeauty(R). Joseph M. Barry, Esq., at Young, Conaway, Stargatt & Taylor, represents the Debtors in their Chapter 11 effort. Epiq Bankruptcy Solutions, LLC, is claims agent to the Debtors. Non-debtor affiliates Premier Salons, Inc. and Premier Salons Ltd. and its U.S. and Canadian corporate affiliates own and operate 340 hair and cosmetic service salons throughout North America, with locations in specialty stores such as Saks, Sears, and Macy's. TRUVO USA: To Explore Settlement with Creditors by Oct. 4 --------------------------------------------------------- The Honorable Arthur J. Gonzalez put his stamp of approval on the First Amended Disclosure Statement with Respect to the First Amended Join Plan of Reorganization of Truvo USA LLC and its debtor-affiliates on Sept. 8, 2010, and authorized the Debtors to solicit acceptances of that Plan from creditors. If the official committee of unsecured creditors files an objection to confirmation of the Debtors' plan by 4:00 p.m. on Oct. 4, 2010, Judge Gonzalez will convene a confirmation hearing at 9:00 a.m. on Nov. 8, 2010. If the Committee refrains from filing an objection, Judge Gonzalez will hold the confirmation hearing at 9:30 a.m. on Oct. 6, 2010. The parties will engage in discovery and possible settlement talks between now and Oct. 4. As reported in the Troubled Company Reporter on Sept. 8, 2010, the unsecured creditors' committee -- comprised of two holders of second-lien debt and their indenture trustee -- doesn't support the Debtors' Plan. The committee members are AllianceBernstein LP, Normandy Hill Capital LP, and Bank of New York Mellon-London Branch as indenture trustee. Under the Plan, the senior lenders under are to receive the new equity plus EUR600 million new debt. In return for the EUR595 million on two issues of second-priority notes, the holders are to be given EUR15 million and warrants for 14% of the stock at a EUR150 million price. If the second lien lenders vote against the plan, they are to receive nothing. For the EUR174 million on pay-in-kind third-priority notes, holders will receive warrants for 1% of the new equity. If the class votes against the plan, they are to receive nothing. The new debt for the senior lenders is to consist of EUR350 million in first-lien debt, EUR100 million in second-lien debt, and EUR150 million in pay-in-kind debt. The Unsecured Creditors' Committee is represented by: Gregory M. Petrick, Esq Ingrid Bagby, Esq Sharon J Richardson, Esq CADWALADER WICKERSHAM & TAFT LLP One World Financial Center New York, NY 10281 Telephone: (212) 504-6373 About Truvo USA Wilmington, Delaware-based Truvo USA LLC is a non-operating subsidiary of Belgium-based Truvo Luxembourg S.a.r.l, which publishes print and online directories through its operating subsidiaries. Truvo USA and other non-operating affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-13513) on July 1, 2010. The Company estimated $500 million to $1 billion in assets and more than $1 billion in debts in its Chapter 11 petition. Sean A. O'Neal, Esq., and Thomas J. Moloney, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, and Vincent Edward Lazar, Esq., at Jenner & Block LLP, assist the Company in its restructuring effort. Jenner & Block LLP and Simpson Thacher & Bartlett LLP are the Company's special counsel. Houlihan Lokey Howard & Zukin (Europe), Limited, is the Company's restructuring and financial advisor. Truvo Luxembourg and its operating subsidiaries have not sought protection under Chapter 11 protection or any other insolvency regime. UNIGENE LAB: Shows New Strategy & Corporate Realignment ------------------------------------------------------- Unigene's CEO presented the Company's new strategy and corporate realignment at Rodman & Renshaw 12th Annual Healthcare Conference. Unigene Laboratories Inc. disclosed a strategic realignment and the creation of two new highly focused Strategic Business Units - "Unigene Biotechnologies" and "Unigene Therapeutics". Unigene Biotechnologies will focus on opportunities where the Company can apply its industry-leading Peptelligence platform of peptide drug delivery and manufacturing assets, expertise and capabilities to partners' proprietary development programs. Unigene Therapeutics constitutes Unigene's own pipeline of novel, proprietary peptide development programs focused on metabolic disease and inflammation. According to President and Chief Executive Officer, Ashleigh Palmer, Unigene is pursuing this new strategy and restructuring into two separate business units in order to increase the visibility of its Peptelligence technologies and capabilities; focus the Company's business development initiatives, and enhance its lead position in the peptide market, as well as accelerate the progress of lead compounds and advance earlier-stage candidates. "Peptides are a rapidly growing therapeutic class with more than 130 programs currently in active development throughout the industry. To date, more than fifty peptide-based therapeutics have reached the market," said Mr. Palmer. "It is critical Unigene be at the forefront of creating tailored solutions for current and future partners. Our goal is to see our Peptelligence platform, which represents a distinctive set of capabilities and assets, incorporated into as many peptide programs as possible that are advancing through development towards commercialization." Unigene's Peptelligence encompasses extensive intellectual property covering superior drug delivery and manufacturing technologies, unsurpassed peptide research and development expertise, and proprietary know-how representing a genuine distinctive competence and dominant competitive advantage. Core Peptelligence assets include proprietary oral and nasal peptide drug delivery technologies, and proprietary, high-yield, scalable and reproducible recombinant manufacturing technologies. "Unigene has a strong base from which we intend to launch our expanded business-to-business marketing initiatives," Mr. Palmer continued. "Based on an extensive situational analysis and competitive benchmarking we have aligned our strengths with the substantial opportunities available to us. These include focusing our high-risk, high-return Unigene Therapeutics pipeline on metabolic and inflammatory diseases with significant unmet medical and socioeconomic needs. Further, it is our intention that programs which don't fit our core focus, including our Chinese joint venture and site-directed bone growth program, will be monetized, out-licensed or terminated. We know our greatest strengths are in customizing delivery and manufacturing solutions for novel therapeutic peptides, and we will focus the Unigene Biotechnologies business unit on doing just that, generating near- term fee-for-service revenues and longer-term milestone payments and royalties." Unigene's technologies have earned extensive clinical and partner validation. The Company's first product to market, Fortical, a nasal calcitonin product, received FDA approval in 2005 and is marketed in the U.S. by Upsher-Smith for the treatment of postmenopausal osteoporosis. Pivotal clinical programs include an oral calcitonin licensed to Tarsa Therapeutics, now in Phase 3 testing for the treatment of osteoporosis. Other validating partnerships include oral parathyroid hormone (PTH), licensed to GlaxoSmithKline and entering Phase 2 planning and development. In addition, Unigene has a manufacturing license agreement with Novartis, which is currently completing three Phase 3 studies of oral calcitonin for the treatment of osteoporosis and osteoarthritis. Mr. Palmer concluded, "In the next months, our investors and current or potential partners will see a continuity of strong business development and business-to-business marketing communications initiatives. We anticipate filling key management positions, including a VP of Business Development, as well as adding other members to the leadership team and board of directors. As the recently appointed CEO of Unigene, I view my mission as nothing less than to transform Unigene into a peptide powerhouse, providing a sense of excitement, focused direction and enduring momentum among our key audiences. Welcome to the New Unigene!" A full-text copy of the Presentation is available for free at http://ResearchArchives.com/t/s?6b3c About Unigene Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/ -- is a biopharmaceutical company focusing on the oral and nasal delivery of large-market peptide drugs. Unigene's balance sheet at June 30, 2010, showed $27.60 million in total assets, $60.32 million in total liabilities, and $32.72 million in stockholders' deficit. Grant Thornton LLP, in New York, expressed substantial doubt about Unigene Laboratories' ability to continue as a going concern following the Company's 2009 results. The firm noted that the Company has incurred a net loss of $13,400,000 during the year ended December 31, 2009 and has an accumulated deficit of approximately $143,000,000 as of December 31, 2009. As of that date, the Company's current liabilities exceeded its current assets by $1,251,000 and its total liabilities exceeded total assets by $30,442,000. UNIVERSAL HEALTH: Fitch Assigns 'B+' Rating on $250-Mil. Notes -------------------------------------------------------------- Fitch Ratings has assigned a 'B+' rating to Universal Health Services, Inc.'s $250 million proposed senior unsecured notes due 2018. The notes will be issued by UHS Escrow Corporation, a wholly owned subsidiary of UHS. The proceeds will be used to fund a portion of the Psychiatric Solutions, Inc. acquisition, expected to close in the fourth quarter of 2010 (4Q'10). When the acquisition closes, the proceeds of the proposed senior unsecured notes will be released from escrow and will become obligations of UHS. In addition, Fitch affirms UHS's ratings: -- Issuer Default Rating at 'BB-'; -- Senior unsecured bank credit facility at 'BB-'; -- Senior unsecured notes due 2011, 2016 at 'BB-'; -- Senior secured bank credit facility 'BB'; -- Senior secured notes 'BB'. The Rating Outlook is Stable. The ratings apply to approximately $883 million of debt outstanding at June 30, 2010. The ratings are prospective for the PSYS acquisition. Upon closing of the acquisition, several events impacting the capital structure will be triggered and Fitch expects to take these rating actions: -- The senior secured bank credit facility will become effective. Fitch does not expect to change the 'BB' rating. -- The unsecured bank credit facility will be refinanced, and Fitch expects to withdraw the 'BB-' rating. -- The existing 2011 and 2016 senior unsecured notes will become secured on a parity basis with the senior secured bank facility. Fitch expects to rate the 2011 and 2016 senior secured notes 'BB' when the issues become secured. -- The proceeds of the proposed $250 million senior unsecured notes will be released from escrow. Fitch does not expect to change the 'B+' rating. The $250 million senior unsecured notes will be lower priority debt in the post PSYS acquisition capital structure and the 'B+' rating reflects an expectation that recovery prospect for these notes would be highly prejudiced in a debt restructuring or liquidation, given the large proportion of secured debt in the post acquisition capital structure (about 93% of debt will be secured). UHS's 'BB-' IDR is reflective of the company's operating and credit metrics pro forma for the PSYS acquisition. In May 2010, UHS announced that it had agreed purchase PSYS in an entirely cash funded $3.1 billion transaction. Pending receipt of regulatory approvals and PSYS shareholder approval, the transaction is expected to close in 4Q'10. The $3.1 billion purchase price includes $2 billion to purchase PSYS equity, equating to $33.75 per share, plus the assumption of $1.1 billion of net debt of PSYS. UHS will fund almost 100% of the transaction cost through debt. The transaction will significantly impact UHS's operating and credit metrics. Based on latest 12 months ended June 30, 2010 results, outstanding debt of $883 million equaled 1.2 times EBITDA of $715 million. Pro forma for the transaction, Fitch expects UHS to have approximately $4.1 billion in outstanding debt and to generate in the area of $1.1 billion of EBITDA, including about $330 million contributed by PSYS. Fitch expects debt to equal about 3.8x pro forma EBITDA prior to any potential debt reduction post the acquisition. Although pro forma debt leverage is somewhat elevated relative to UHS's 'BB-' IDR, the rating is supported by these factors: -- Fitch's pro forma EBITDA does not take into account the potential for cost synergies beyond the elimination of about $40 million of duplicative corporate expense in 2011. PSYS's EBITDA margin runs about 200-250 basis points below UHS's behavioral health segment EBITDA margin, providing support for the expectation that there is upside potential for EBITDA growth through improvement of PSYS's profitability. -- There is the potential for debt reduction post acquisition through free cash flow, or through the application of asset sale proceeds. Some level of divestitures in areas of geographic overlap is highly likely in order to obtain regulatory approvals necessary for the acquisition to proceed. -- The acquisition will significantly expand UHS's presence in the behavioral health space. PSYS is the largest standalone operator of freestanding inpatient psych facilities, with 94 facilities in 32 states, Puerto Rico and the US Virgin Islands. UHS's behavioral health segment provides operational diversification that is unique amongst for-profit hospital providers. In general, relative to the acute care hospital segment, behavioral health operations are more profitable, exhibit less volatility in patient volumes and revenues and are less vulnerable to certain challenges faced by the acute care segment, including high levels of uncompensated care and significant regulatory risk. For the LTM ended June 30, 2010, UHS's behavioral health segment contributed about 26% of the company's revenues and about 39% of its EBITDA. Fitch estimates that post acquisition, the contribution of the behavioral segment will increase to 45% of revenue and 55% of EBITDA. In addition, the acquisition will increase UHS's geographic diversity, ameliorating credit risk related to its high degree of exposure to the Las Vegas, NV market, which represented about 22% of revenues in 2009. Impact of Acquisition on Capital Structure: The majority of the financing for the acquisition will come from the new senior secured bank credit facility which UHS launched in 3Q'10. The new facility commitment totals $3.45 billion and consists of: -- An $800 million revolving credit agreement; -- A $1.05 billion term loan A; -- A $1.6 billion term loan B. Fitch rates the secured credit facility 'BB', one-notch above the 'BB-' IDR, due to the credit enhancement provided by the credit facility collateral, which is expected to include hard asset security in the form of real estate owned by UHS and its domestic subsidiaries. The only pieces of UHS's current capital structure that will remain outstanding after the acquisition are the 2011 and 2016 senior unsecured notes; because of the limitations on liens provision in the notes indenture, the notes will become secured on a parity basis with the secured credit facility when the facility becomes effective. Therefore, when the new credit facility becomes effective and the senior notes become secured, Fitch expects to rate the notes 'BB'. Other sources of financing to be used for the acquisition include the $250 million of proposed senior unsecured notes. These notes will be heavily subordinated, as 93% of debt will be secured through the bank debt and existing 2011 and 2016 notes. Therefore, recovery for holders of these notes in the event of liquidation or restructuring will be prejudiced, and Fitch rates the unsecured notes 'B+', one-notch below the IDR. Based on the assumed capital structure and Fitch's pro forma EBITDA estimate, debt-to-EBITDA will be 3.0x through the bank facility, 3.6x through the secured debt and 3.8x through the unsecured debt. Solid Liquidity Profile: Fitch believes UHS has sufficient liquidity to fund its operating and financing needs over the near term. Liquidity is provided primarily through cash from operations ($456 million for the LTM ended June 30, 2010), and the $800 million unsecured credit revolver ($571 million available at June 30, 2010). UHS had $12.3 million in cash on hand at June 30, 2010 and FCF was $119.4 million for the LTM period. Based on a conservative operating scenario for the combined UHS/PSYS, Fitch expects annual FCF (defined as CFO less dividends and capital expenditure) generation to stabilize around $150 million, indicative of around a 2% FCF margin. Near-term debt maturities should be manageable; the next significant maturities occur in 2011, when the unsecured bank credit revolver ($166 million drawn as of June 30, 2010) and the $200 million 6.75% senior notes are due in July and November, respectively. Fitch expects the outstanding amount on the revolver to be refinanced when the new credit facilities become effective, anticipated in 4Q'10. In the event internal liquidity is not sufficient to fund the $200 million senior note maturity in November 2011, Fitch believes UHS will have adequate capital market access or sufficient capacity on its bank credit revolver to refinance the maturity. Guidelines For Further Rating Actions: As indicated by the Stable Rating Outlook, Fitch believes a change in the ratings is unlikely over the next 12-24 months. However, if debt leverage reduction post the acquisition were to outpace Fitch's expectations due to some combination of above projected growth in EBITDA and more aggressive than anticipated debt reduction, leading to debt-to-EBITDA falling to near 3.0x in the near term, it could precipitate a positive rating action. Total debt of $883 million at June 30, 2010 consisted primarily of: Senior Unsecured Credit Facility: -- $200 million A/R securitization facility due August 2010 ($100 million outstanding at June 30, 2010), to be replaced with new $250 million A/R securitization program; -- $166 million due 2011. Senior Notes: -- $200 million due 2011; -- $400 million due 2016. USG CORP: Contributes 3.2-Mil. Shares to Retirement Plan Trust -------------------------------------------------------------- USG Corporation contributed on Sept. 8, 2010, 3,271,405 shares of its common stock, par value $.10 per share, to the USG Corporation Retirement Plan Trust, the trust maintained in connection with the defined benefit pension plan sponsored by the Registrant. The Contributed Shares were valued for purposes of the contribution at $12.38 per share, or approximately $40.5 million in the aggregate, by Evercore Trust Company, N.A., an independent fiduciary that has been appointed as investment manager with respect to the Contributed Shares. The Contributed Shares were issued to The Northern Trust Company, as trustee of the Trust, in reliance upon the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended, and in furtherance of the Registrant's funding of the Trust. On Sept. 8, 2010, the Company also entered into a Registration Rights Agreement with Evercore, in its capacity as investment manager for the Contributed Shares. The Registration Rights Agreement requires, among other things, that the Company file with the Securities and Exchange Commission a shelf registration statement on Form S-3 to register the Contributed Shares for the purpose of resale from time to time by the Trust. Under the Registration Rights Agreement, the Company is required to use its commercially reasonable efforts to cause the registration statement to remain continuously effective until all Contributed Shares have been sold by the Trust, all of the Contributed Shares may be sold in accordance with Rule 144 promulgated by the SEC under the Act or 90 days after the number of Contributed Shares held by the Trust is less than 1% of the Company's then outstanding shares of common stock, whichever occurs earlier. The Company registered the resale of the Contributed Shares by the Trust with the SEC on Sept. 8, 2010. A full-text copy of the Registration Rights Agreement is available for free at http://ResearchArchives.com/t/s?6b39 VICTOR VALLEY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Victor Valley Community Hospital 15248 Eleventh Street Victorville, CA 9239 Bankruptcy Case No.: 10-39537 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Central District of California (Riverside) Judge: Catherine E. Bauer Debtor's Counsel: Mary D. Lane, Esq. Samuel R. Maizel, Esq. Scotta E. McFarland, Esq. PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Boulevard, Suite 1100 Los Angeles, CA 90067-4100 Tel: (310) 277-6910 Fax: (310) 201-0760 E-mail: mlane@pszjlaw.com smaizel@pszjlaw.com smcfarland@pszjlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Kathy Davis, chairman of the board of directors. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Physicians Hospital Management LLC Management Fees $1,393,822 18523 Corwin Road, Suite H Apple Valley, CA 92307 Cerner Corporation Trade $1,267,067 2800 Rockcreek Parkway Kansas City, MO 64117 PHS Professional Hospital Supply Trade $480,414 Inc P.O. Box 23229 Pasadena, CA 91185 CA Department of Health-Genetic Trade $390,989 Box 186, 2163 Meeker Avenue Richmond, CA 94804-6410 Desert Physicians Management Management Fees $370,000 18564 Highway 18, Suite 110 Apple Valley, CA 92307 Stryker Medical Trade $325,118 P.O. Box 93308 Chicago, IL 60673-3308 Medtronic USA Trade $289,760 Bank of America Lock Box Service 4642 Collection Center Drive Chicago, IL 60693 Medtronic Sofamor Danekputin Trade $289,760 12099 Collections Center Drive Sofamor Danek Chicago, IL 60693 Anthem Blue Cross Medical Premiums $254,816 Department 5812 ACC# 25528H001 Los Angeles, CA 90074-5812 Depuy Orthopaedics Trade $230,571 Westcliff Medical Lab, Inc Trade $139,839 Alpha Fund Trade $121,402 Premium Financing Specialists Premiums $119,056 Thompson Engineering Trade $101,061 Cardinal Health Pharmaceutical Trade $96,349 Health Care Legal Services Trade $96,015 Sourcecorp Health Serv Trade $92,326 Spinal Graft Tech -- $79,332 Sorin Group Trade $72,500 Surgical Directions, LLC Trade $65,919 VILLAGE GREEN: Rents Not Assigned Are Property of the Estate ------------------------------------------------------------ Under Tennessee law, WestLaw reports, an assignment of rents clause in a deed of trust that a Chapter 11 debtor gave prepetition was not an absolute assignment, despite language in the deed of trust that the assignment was intended as a present, absolute, and irrevocable transfer to the deed of trust lender of all interest which the debtor had in the rents. The deed of trust also indicated that the assignment was for purpose of securing the debtor's obligations under the deed of trust note. Moreover, by allowing the debtor to retain any surplus rent and by providing for a release of the lender's interest in rent upon payment of the deed of trust note in full, the deed of trust plainly recognized that the debtor still had a continuing interest in rents. Thus, rents were included in the property of the estate and could be used by the debtor as cash collateral. In re Village Green I, GP, --- B.R. ----, 2010 WL 3488787 (Bankr. W.D. Tenn.) (Emerson, J.). In connection with this ruling, the Honorable George W. Emerson, Jr., denied Fannie Mae's motion for relief from the automatic stay, authorized the debtor to use Fannie Mae's cash collateral, and required the Debtor to provide Fannie Mae with adequate protection pursuant to 11 U.S.C. Secs. 363 and 361. Village Green I GP owns the Village Green Apartments located at 3450 Fescue Lane in Memphis, Tenn. Village Green sought Chapter 11 protection (Bankr. W.D. Tenn. Case No. 10-24178) on April 16, 2010. John L. Ryder, Esq., at Harris Shelton Hanover Walsh, PLLC, in Memphis, Tenn., represents the single-asset real estate debtor. The debtor estimated its assets and debts at less than $10 million in its bankruptcy petition. Fannie Mae is owed about $9.2 million. VP WAREHOUSING: Case Summary & 7 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: VP Warehousing, LLC 7235 Vicksburg Pike Fort Wayne, IN 46804 Bankruptcy Case No.: 10-14047 Chapter 11 Petition Date: September 15, 2010 Court: U.S. Bankruptcy Court Northern District of Indiana (Fort Wayne Division) Judge: Robert E. Grant Debtor's Counsel: Howard B. Sandler, Esq. Robert L. Nicholson, Esq. CARSON BOXBERGER LLP 1400 One Summit Square Fort Wayne, IN 46802-3173 Tel: (260) 423-9411 E-mail: sandler@carsonboxberger.com nicholson@carsonboxberger.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's seven largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/innb10-14047.pdf The petition was signed by Scott Olson, managing member. WARREN JOHNSON: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Warren Howard Johnson Susan Seaton Johnson aka Susan Johnson P.O. Box 399 Gardiner, MT 59030 Bankruptcy Case No.: 10-62227 Chapter 11 Petition Date: September 14, 2010 Court: United States Bankruptcy Court District of Montana (Butte) Debtor's Counsel: James A. Patten, Esq. PATTEN, PETERMAN, BEKKEDAHL & GREEN PLLC The Fratt Bldg., Suite 300 2817 2nd Avenue N Billings, MT 59101 Tel: (406) 252-8500 Fax: (406) 294-9500 E-mail: japatten@ppbglaw.com Scheduled Assets: $2,039,359 Scheduled Debts: $1,701,952 A list of the Joint Debtors' 4 largest unsecured creditors filed together with the petition, is available for free at http://bankrupt.com/misc/mtb10-62227.pdf WEST CORPORATION: Plans to Amend Senior Sec. Credit Facilities -------------------------------------------------------------- West Corporation said it intends to seek amendments to its senior secured credit facilities to, among other things: i) extend the maturity of its $250 million senior secured revolving credit facility from October 2012 to January 2016; ii) extend the maturity of $500 million of its term loans due October 2013 to July 2016; iii) modify the step-down schedule in the current financial covenants and modify certain covenant baskets; and iv) repay approximately $500 million of its term loans maturing October 2013. These amendments will be subject to certain conditions, including (x) the Company's obtaining consent of the lenders holding a majority of the commitments and loans outstanding under the senior secured credit facilities; (y) the Company's having issued at least $500 million aggregate principal amount of senior unsecured notes and having used the net proceeds thereof to prepay a portion of the Company's term loans due October 2013; and (z) after giving effect to the prepayment of term loans from the net proceeds of the New Senior Notes and the extended maturity of $500 million of term loans, the aggregate principal amount of the term loans outstanding with a maturity of October 2013 not exceeding certain levels. The terms of the amended credit agreement have not yet been finalized. About West Corporation Founded in 1986 and headquartered in Omaha, Nebraska, West Corporation -- http://www.west.com/-- provides outsourced communication solutions to many of the world's largest companies, organizations and government agencies. West Corporation has a team of 41,000 employees based in North America, Europe and Asia. West Corporation had total assets of $3,008,762,000, total liabilities of $4,068,914,000, Class L Common Stock of $1,413,958,000, and a stockholders' deficit of $2,474,110,000 as of June 30, 2010. West Corp. carries a 'B2' corporate rating from Moody's and 'B+' corporate rating from Standard & Poor's. WEST CORP: Moody's Assigns 'Ba3' Rating on $500-Mil. Loan --------------------------------------------------------- Moody's investors Service assigned a Ba3 rating to West Corporation's proposed extension of $500 million of its senior secured term loan B, a Ba3 to its proposed extension of its $250 million amended revolving credit facility, and a B3 rating to the proposed offering of $500 million of senior unsecured notes. Concurrently, Moody's affirmed the B2 Corporate Family Rating, the B2 Probability of Default Rating and the SGL-2 Speculative Grade Liquidity Rating. The rating outlook is stable. Moody's took these rating actions (LGD assessments revised): -- Assigned $500 million senior secured term loan B due 2016, Ba3 (LGD 2, 25%) -- Assigned $250 million senior secured revolving credit facility due 2016, Ba3 (LGD 2, 25%) -- Assigned $500 million senior unsecured notes due 2018, B3 (LGD 5, 76%) -- Affirmed $2.4 billion senior secured term loan B due 2013/2016, B1 (LGD 3, 33%) -- balance expected to decline to $1.4 billion and rating raised to Ba3 post-refinancing -- Affirmed $250 million senior secured revolving credit facility due 2012, B1 (LGD 3, 33%)- rating expect to be withdrawn upon completion of refinancing -- Affirmed $650 million senior notes due 2014, Caa1 (LGD 5, 83%) -- rating expected to be raised to B3 upon completion of the proposed refinancing -- Affirmed $450 million senior subordinated notes due 2016, Caa1 (LGD 6, 94%) -- Affirmed Corporate Family Rating, B2 -- Affirmed Probability of Default Rating, B2 -- Affirmed Speculative Grade Liquidity Rating, SGL-2 Ratings Rationale The proposed extension of the credit facility is contingent upon the closing of the senior note offering. The proposed term loan extension will extend the maturity date on $500 million of currently outstanding term loan B to 2016 from 2013. Proceeds from the $500 million offering of senior unsecured notes are expected to be used to repay an additional $500 million of term loan B due in 2013. Although the refinancing will moderately increase interest expense, Moody's expect credit metrics to remain in line with B2 rating category. Furthermore, the refinancing will substantially reduce 2013 debt maturities. If the senior note offering and related paydown of the term loan are completed, Moody's expects to raise the rating on the existing term loan B to Ba3 from B1 and the rating on the $650 million of existing senior notes due 2014 to B3 from Caa1. The raised ratings on the secured credit facility post-refinancing will reflect less secured debt outstanding and greater debt cushion in the form of additional senior notes. The raised ratings on the senior notes due 2014 post-refinancing will reflect subordination to a lower balance of secured debt. The B2 Corporate Family Rating reflects significant financial leverage, revenue declines in certain agent-based service lines, pricing pressures, and technology risks in automated service lines. The ratings are supported by the company's scale and leading market positions, track record of revenue and profitability growth in automated service lines, and stable financial performance during 2009 and the first half of 2010 despite pressures from a difficult macro-environment. Financial strength metrics are broadly in line with the B2 rating category. The 2016 maturity of the proposed term loan and revolver could be accelerated to July 2014 if more than $50 million of senior notes due 2014 remain outstanding as of such date and the senior secured leverage ratio (as defined) exceeds 2.8 times. The stable outlook anticipates flat revenues, modest profitability growth and a modest improvement in financial strength metrics over the next year. The ratings could be upgraded if improving financial performance or debt reduction results in sustained Debt to EBITDA and free cash flow to debt of about 5 times and 7%, respectively. The ratings could be pressured if pricing trends worsen or significant client losses result in declining revenues and operating margins. A significant debt financed acquisition that weakens credit metrics could also pressure the rating. If these conditions result in sustained Debt to EBITDA and free cash flow to debt of greater than 7 times and less than 2%, respectively, a downgrade is possible. Based in Omaha, Nebraska, West is a leading provider of outsourced communication solutions to clients in a variety of industries, including telecommunications, banking, retail, financial services, technology and healthcare. The company operates in two business segments, unified communications and communication services, and reported revenues of approximately $2.4 billion in the twelve month period ended June 30, 2010. WEST CORP: S&P Assigns 'B' Rating on $500-Mil. Senior Notes ----------------------------------------------------------- Standard & Poor's Ratings Services assigned Omaha, Neb.-based West Corp.'s proposed $500 million senior unsecured notes due 2018 its issue-level rating of 'B' (one notch lower than the 'B+' corporate credit rating on the company). S&P also assigned this debt a recovery rating of '5', indicating S&P's expectation of modest (10%-30%) recovery for noteholders in the event of a payment default. The company plans to use note proceeds to reduce its term loan balance. At the same time, S&P revised its recovery rating on the company's existing senior unsecured debt to '5' from '6'. S&P raised the issue-level rating to 'B' from 'B-', in accordance with S&P's notching criteria for a recovery rating of '5'. Existing ratings on the company, including the 'B+' corporate credit rating, were affirmed. The rating outlook is stable. "The 'B+' corporate credit rating reflects S&P's expectation that leverage at West Corp. will remain high over the intermediate term as the company continues its acquisitive growth strategy," said Standard & Poor's credit analyst Andy Liu. West has been an active acquirer of automated services companies as it seeks to expand its presence in higher-margin areas. The company is a business process outsourcer with operations in the U.S., the U.K., and many other countries. Its service offerings include conferencing services, emergency alerts, and agent-based and automated call center services. S&P considers West's business risk profile to be "fair." The company competes in the fragmented and highly competitive market for communication services. West competes with larger peers, and often against clients' in-house staff. A significant portion of the market is still being served by in-house staff. The market for teleconferencing services is competitive as well, despite its higher margins. West must constantly strive to increase call volume and decrease its costs to offset lower pricing. Nonetheless, S&P believes that longer term trends will continue to favor outsourcers such as West as companies continue to outsource noncore functions to extract operating efficiencies. In S&P's view, West has a "highly leveraged" financial profile. Pro forma for the transaction, lease-adjusted total debt to EBITDA was 5.7x for the 12 months ended June 30, 2010, which is in line with the debt-to-EBITDA ratio for the rating category. Based on West's history of debt-funded acquisitions, the company is unlikely to significantly reduce debt with free cash flow. Any decrease in debt leverage will require EBITDA expansion, in S&P's view. Pro forma lease-adjusted EBITDA coverage of interest declined to 2.3x for the 12 months ended June 30, 2010, due to higher interest costs on the amended revolving credit facility, the amended term loan, and the unsecured notes. (The company is amending and extending its $250 million revolver to 2016 and $500 million of its term loan to 2016.) Discretionary cash flow represented 37% of EBITDA. West had proposed to offer up to $500 million of common stock in an initial public offering. If the IPO is successful and the company uses proceeds to reduce debt, this could have a positive effect on the rating. It will depend on the size of debt reduction and business performance at the time. WIEN BAKERY: Case Summary & 8 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Wien Bakery LLC 3035 W. Olympic Boulevard Los Angeles, CA 90006 Bankruptcy Case No.: 10-48843 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Barry Russell Debtor's Counsel: Robert Y. Lee, Esq. LEE LAW GROUP APLC 3699 Wilshire Boulevard, Suite 1100 Los Angeles, CA 90010 Tel: (213) 383-5400 Fax: (213) 383-5402 E-mail: robert@lgcounsel.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-48843.pdf The petition was signed by Hae Duk Kim, owner and controlling shareholder. WILLIAM RAMAGE: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------- Joint Debtors: William Lawrence Ramage Jill Marie Ramage 1436 Liverpool Way Petaluma, CA 94954 Bankruptcy Case No.: 10-13515 Chapter 11 Petition Date: September 13, 2010 Court: U.S. Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtors' Counsel: Steven M. Olson, Esq. LAW OFFICES OF STEVEN M. OLSON 100 E. Street, #214 Santa Rosa, CA 95404 Tel: (707) 575-1800 E-mail: smo@smolsonlaw.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Joint Debtors' 19 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-13515.pdf WYNDHAM WORLDWIDE: Moody's Gives Pos. Outlook; Puts 'Ba1' Rating ---------------------------------------------------------------- Moody's revised Wyndham's rating outlook to positive from stable reflecting an improving operating outlook for each of its business segments, reduced timeshare business risks, the company's commitment to manage its timeshare segment for cash, and the expectation that credit metrics will improve modestly over the next year. Moody's also assigned a Ba1 rating to Wyndham's new $250 million senior unsecured note offering and affirmed the company's Ba1 Corporate Family Rating. The note proceeds will be used to reduce outstanding indebtedness. Ratings Rationale The ratings consider Wyndham's leading market position in each of its three business segments, and the high margins and low capital intensity of its hotel franchise and vacation exchange and rentals segments. The rating also reflects slightly reduced timeshare business risk given lower development spending and a higher level of cash sales. Key credit concerns include timeshare business risks -- particularly high default rates associated with timeshare consumer receivables -- as well as a reliance on the securitization market to recycle consumer receivables so that capital can be made available for other corporate objectives, including returns to shareholders. Ratings could be upgraded if recently improved operating trends are sustained and result in higher year over year consolidated EBITDA, the company continues to effectively manage its timeshare business for cash and reduces the risk exposure that the business entails, maintains access to the securitization market, renews its timeshare receivable conduit that matures in October 2010, and if debt/EBITDA drops below 3.0 and appears likely to remain at this lower level. over the long term. Ratings could be downgraded if it appears likely debt to EBITDA would rise above 3.75 times or if the company's financial policy become more aggressive. Rating assigned: -- $250 million senior unsecured notes due 2018 at Ba1, (LGD 4, 61%) Ratings affirmed: -- Corporate Family Rating at Ba1 -- Probability of Default Rating at Ba1 -- Senior unsecured bonds at Ba1 (LGD 4, 61%) -- Unsecured debt shelf at (P) Ba1 (LGD 4, 61%) -- Preferred debt shelf at (P) Ba2 (LDG 6, 97%) YASMIN KASHANI: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Yasmin Kashani 10724 Wilshire Boulevard, Suite 1001 Los Angeles, CA 90024 Bankruptcy Case No.: 10-49040 Chapter 11 Petition Date: September 14, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Ernest M. Robles Debtor's Counsel: David B. Golubchik, Esq. LEVENE NEALE BENDER RANKIN & BRILL LLP 10250 Constellation Boulevard, Suite 1700 Los Angeles, CA 90067 Tel: (310) 229-1234 E-mail: dbg@lnbrb.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-49040.pdf * August Bankruptcy Filings By Multi-Million Dollar Companies ------------------------------------------------------------- Six companies with assets at least $100 million in assets tumbled into Chapter 11 bankruptcy in August, a tad lower from the eight mega filers in July. Boston Generating LLC was the lone billion-dollar filer for August, estimating more than a billion dollars in assets and debts. Year-to-August 2010, seven companies have filed for Chapter 11 bankruptcy disclosing more than a billion dollar in assets. Year- to-August 2009, billion-dollar filers total 36. Total billion- dollar filers for 2009 reached 44. The other August mega-filers are: * Chemtura Canada Co./Cie.; * Sea Island Company; * Caribbean Petroleum Corporation; * Petroflow Energy Ltd.; and * OTC Holdings Corporation Bankruptcy filings by large companies remain low compared to August 2009. Last year, 11 large companies went belly up, lead by billion-dollar companies Cooper-Standard Holdings Inc., The Reader's Digest Association, Inc., and Taylor Bean & Whitaker Mortgage Corp. Cooper-Standard and Reader's Digest have since emerged from bankruptcy. Year-to-August 2010, 73 chapter 11 cases were commenced by companies with assets between $100 million and $1 billion. Last year, 163 chapter 11 cases were commenced by companies with assets between $100 million and $1 billion. OTC Holdings commenced a prepack case in August. Year-to-August, a total of 26 prepacks/pre-arranged cases were filed. 2010 Large Chapter 11 Cases $100MM $500MM Month - $500MM $1BB > $1BB Prepacks Total ----- -------- ------ ------ -------- ----- January 14 2 1 8 17 February 6 1 3 3 15 March 9 3 - 5 12 April 7 1 - 3 8 May 12 - - 2 12 June 4 1 - 1 5 July 5 1 2 3 8 August 3 2 1 1 6 Of the August mega-cases, three cases went to Delaware, bringing the year's total to 30. Two went to Manhattan. So far this year, 14 mega-cases were commenced in Manhattan. In 2009, 79 mega-cases went to Delaware while 32 cases went to Manhattan. The top 15 filers for the year by total assets, thus far, are: Case Total Assets Court Petition Date ---- ------------ ----- ------------- Movie Gallery, Inc. More than $1BB VAEB 2-Feb Aleris Deutschland More than $1BB Del 5-Feb (affiliate of Aleris Int'l) Capmark Investments More than $1BB Del 15-Jan (affiliate of Capmark Financial) ESA P Portfolio More than $1BB Del 18-Feb TXNC GP L.L.C. (affiliates of Extended Stay) Innkeepers USA Trust More than $1BB SDNY 19-Jul Protech Holdings C More than $1BB Del 29-Jul (affiliate of Capmark Financial) Boston Generating LLC More than $1BB SDNY 18-Aug Mesa Air Group Inc. $975,487,000 SDNY 5-Jan Almatis B.V. $500MM - $1BB CASB 30-Apr Centaur, LLC $500MM - $1BB Del 6-Mar Penton Media $500MM - $1BB SDNY 10-Feb Sargent Ranch LLC $500MM - $1BB CASB 4-Jan South Bay Expressway $500MM - $1BB CASB 22-Mar Garlock Sealing $500MM - $1BB CASB 22-Mar Xerium Technologies $693,511,000 Del 30-Mar Orleans Homebuilders, which had $591,463,000 in total assets, drops out of the Top 15 list. Orleans Homebuilders filed March 1, 2010. Lehman Brothers Holding Corp. remains the biggest corporate bust in history. Lehman, which filed in 2008, had $639 billion in total assets and $613 billion in total debts at that time of its filing. AUGUST 2010 MEGA CASES (A) Boston Generating New York-based Boston Generating, LLC, owns nearly 3,000 megawatts of mostly modern natural gas-fired power plants in the Boston area. Privately held Boston Generating is an indirect subsidiary of US Power Generating Co., and considers itself as the third- largest fleet of plants in New England. Boston Generating and its affiliates filed for Chapter 11 protection on August 18, 2010 (Bankr. S.D.N.Y. Case No. 10-14419) to consummate a sale of its assets. Under an August 7, 2010 asset purchase agreement, the Debtors will sell the assets to Constellation Holdings, Inc., for $1.10 billion. In the event that the Stalking Horse Bidder isn't chosen as the winning bidder, the Stalking Horse Bidder will receive a break-up fee of $30 million and up to $5 million for reimbursement of expenses. Bids are due Oct. 25. An auction is slated for Oct. 29. Boston Generating estimated its assets and debts at more than $1 billion as of the Petition Date. D. J. Baker, Esq., at Latham & Watkins LLP, serves as bankruptcy counsel for the Debtors. JP Morgan Securities is the Debtors' investment banker. Perella Weinberg Partners, LP, is the Debtors' financial advisor. Brown Rudnick LLP is the Debtors' regulatory counsel. FTI Consulting, Inc., is the Debtors' restructuring consultant. Anderson Kill & Olick, P.C., is the Debtors' conflicts counsel. The Garden City Group, Inc., is the Debtors' claims agent. (B) Chemtura Canada Co./Cie. Chemtura Canada Co./Cie filed a voluntary Chapter 11 petition on August 8, 2010, with the U.S. Bankruptcy Court for the Southern District of New York solely to address diacetyl-related claims asserted against it. Chemtura Canada is a wholly owned indirect subsidiary of Chemtura Corporation. Chemtura Canada is part of Chemtura Corp.'s globally diversified specialty chemicals business, with operations in Chemtura Corp.'s Industrial Engineered Products segment. Chemtura Canada directly or indirectly owns several subsidiaries that operate in Italy (Chemtura Italy S.r.l.) and Brazil (Chemtura Industria Quimica de Brasil Ltda.), among other countries. Chemtura Canada was mainly involved in the production of diacetyl, a butter flavoring that was widely used in the food industry before 2005. As of August 8, 2010, there are 22 pending lawsuits against Chemtura Corp. or Chemtura Canada based on allegations that exposure to diacetyl manufactured by Chemtura Canada and distributed by Chemtura and Citrus caused respiratory illness in numerous food industry factory workers. Chemtura Canada's bankruptcy filing was contemplated under the parent company and its affiliates' plan of reorganization. The Original Debtors revised the bankruptcy-exit plan on July 9, 2010, to include Chemtura Canada as a potential debtor so that Diacetyl Claims against Chemtura Canada can be addressed in the same manner as Diacetyl Claims against Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. (C) Sea Island Company Sea Island -- http://www.seaisland.com/-- is a private resort and real estate development company founded in 1926. Carrick Mollenkamp and Lingling Wei, writing for The Wall Street Journal, said Sea Island hit a financial wall when it couldn't repay debt taken on by Bill Jones III, the company's CEO and the fourth generation of his family to lead Sea Island, as part of a $395 million renovation and expansion in 2006 and 2007. Sea Island reached an agreement to sell substantially all of its assets to Sea Island Acquisition LP, a limited partnership formed by investment funds managed by the global investment firms Oaktree Capital Management, L.P. and Avenue Capital Group. The Company filed for Chapter 11 bankruptcy to facilitate the sale. It has also filed a bankruptcy plan premised on the sale. J. Scott Trubey at the Atlanta Journal-Constitution reported that Starwood Capital Group and Anschutz Entertainment Group made a $199 million offer for the assets of Sea Island Co., surpassing the $197.5 million bid of Oaktree Capital Management and Avenue Capital Group. Mr. Trubey also reported that a federal bankruptcy judge nixed the new bid, saying that if the Starwood-Anschutz partnership wanted to bid for the asset, it will have to do so at the auction. A group of unsecured creditors backed the Starwood- Anschutz bid. The Debtors have proposed that an auction be held on October 11. Sea Island filed for Chapter 11 protection on August 10, 2010 (Bankr. S.D. Ga. Case No. 10-21034). Sarah R. Borders, Esq.; Harris Winsberg, Esq.; Sarah L. Taub, Esq.; and Jeffrey R. Dutson, Esq., at King & Spalding LLP, assists the Debtor in its restructuring effort. Robert M. Cunningham, Esq., at Gilbert, Harrell, Sumerford & Martin PC, is the Debtor's co-counsel. FTI Consulting, Inc., is the Debtor's restructuring advisor. EPIQ Bankruptcy Solutions, LLC, is the Debtor's claims and notice agent. The official committee of unsecured creditors has retained Jordi Guso, Esq. and Berger Singerman, P.A. as its counsel. The Debtor estimated its assets and debts at $500 million to $1 billion as of the Petition Date. (D) Caribbean Petroleum Corporation San Juan, Puerto Rico-based Caribbean Petroleum Corporation, aka CAPECO, owns and operates certain facilities in Bayomon, Puerto Rico for the import, offloading, storage and distribution of petroleum products. Cribbean Petroleum filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-12553) on August 12, 2010, nearly 10 months after a massive explosion at its major Puerto Rican fuel storage depot virtually shut down the company's operations. The Debtor estimated assets at $100 million to $500 million and debts at $500 million to $1 billion as of the Petition Date. Affiliates Caribbean Petroleum Refining, L.P., and Gulf Petroleum Refining (Puerto Rico) Corporation filed separate Chapter 11 petitions on August 12, 2010. The Debtors' lead counsel is Cadwalader, Wickersham & Taft LLP. The Debtors' financial advisor is FTI Consulting Inc. The Debtors' chief restructuring officer is Kevin Lavin of FTI Consulting Inc. Judge Kevin Gross had rejected an attempt by the Puerto Rico Treasury Department to transfer Caribbean Petroleum's bankruptcy case to a court in its jurisdiction, clearing the way for the company to begin arranging for the sale of its assets. The Debtors are seeking permission from the Court to implement a sale process for substantially all of their assets. The Debtors seek to enter into a stalking horse agreement by November 10, 2010, with one or more bidders for the purpose of establishing a minimum acceptable bid for the assets. (E) Petroflow Energy Ltd. Petroflow Energy is the parent of Denver, Colorado-based North American Petroleum Corp. USA and Prize Petroleum Corp. North American Petroleum is a natural gas driller. Petroflow Energy filed on August 20 (Bankr. D. Del. 10-12608). When it filed for bankruptcy, Petroflow sought recognition of the U.S. chapter 11 proceedings from the Alberta Court of Queen's Bench under the Companies' Creditors Arrangement Act in Canada, and have its chapter 11 case jointly administered with those of its two chapter 11 debtor affiliates under the caption "In re North American Petroleum Corporation USA, Case # 10-11707 (CSS)." North American Petroleum filed for Chapter 11 bankruptcy protection on May 25, 2010 (Bankr. D. Del. Case No. 10-11707). Affiliate Prize Petroleum LLC filed a separate Chapter 11 petition on May 25, 2010 (Case No. 10-11708). Attorneys at Kirkland & Ellis LLP serve as bankruptcy counsel. Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, is the Debtor's Delaware counsel. Kinetic Advisors LLC is the Company's restructuring advisor. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice, claims and balloting agent. The Debtor estimated its assets and debts at $100 million to $500 million as of the Petition Date. (F) OTC Holdings Corporation Oriental Trading Co. is a direct marketer of home decor products, toys, and novelties. An affiliate of The Carlyle Group purchased 68% of OTC in July 2006 from private-equity investor Brentwood Associates, which continues to own about 24 percent of the equity. Parent OTC Holdings Corporation, together with affiliates, including Oriental Trading Co., filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 10-12636) on August 25, with an agreement with first-lien lenders for a Chapter 11 plan. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that second-lien lenders, owed $180 million plus interest, are not parties to the plan support agreement. Another group of creditors, the mezzanine lenders, is owed a total of $120 million. According to the report, the Plan would give first-lien lenders, owed $403.6 million, all of the new stock plus a new $200 million second-lien note to the senior lenders. If the plan goes through, second-lien creditors would be given warrants for 2.5% of the stock with a strike price based on an enterprise value of $427.5 million. The first-lien lenders, Bloomberg said, will provide a $40 million of DIP financing to fund the Chapter 11 case. At confirmation of the plan, there would be a $50 million first-lien term loan to pay off the DIP loan. JPMorgan Chase Bank NA is agent for the first-lien creditors while Wilmington Trust FSB is agent on the second-lien credit. Wachovia Bank NA serves as agent for the mezzanine debt holders. The Debtors disclosed $463 million in total assets and $757 million in total liabilities as of the Petition Date. Richard Hahn, Esq., My Chi To, Esq., Jae-Sun Chung, Esq., Huyue Angela Zhang, Esq., and Jessica Katz, Esq., at Debevoise & Plimpton LLP, assist the Debtors in their restructuring efforts. Joel A. Waite, Esq., and Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' local counsel. Jefferies & Company, Inc., is the Debtors' financial advisor. Protiviti, Inc., is the Debtors' restructuring consultant. Kurtzman Carson Consultants LLC is the Debtors' claims agent. * BOOK REVIEW: CORPORATE DEBT CAPACITY - A Study of Corporate Debt Policy and the Determination of Corporate Debt Capacity, A Business Classic ------------------------------------------------------------------ Author: Gordon Donaldson Publisher: Beard Books, Washington, D.C. 2000 (reprint of 1961 book published by the President and Fellows of Harvard College). 294 pages. $34.95 trade paper, ISBN 1-58798-034-7. "The research project who results are reported in this volume was primarily concerned with the risk element involved in the utilization of debt as a source of permanent capital for business," Bertrand Fox, Director of Research, succinctly writes in the "Foreword". The research project was funded by and conducted by an organization connected with Harvard College, the original publishers of this book in the early 1960s. The research was not a body of data for analysis as research typically is in business studies or sociological studies. In the end, Donaldson recommends perspectives and practices going beyond the research. This doesn't necessarily go against the findings of the research, but rather shows the limitations of the thinking of most businesspersons at the time or their blind spots regarding the role of debt, especially with respect to potentials for growth, longevity, and other interests of business management. The businesses are not identified. Given Donaldson's credibility and reputation and the Harvard name behind the research project however, the research data is taken as factual and reliable. The research was garnered from participating corporations and financial institutions. Though there are a few tables, the research is not limited to financial information strictly as figures and other balance sheet data. Donaldson was interested as much in corporate leaders' psychology and presumptions about debt more than current debt situations and corporate policies regarding debt. Financial institutions were included as part of the study as well because their views toward corporate debt and the way they worked with the financial parts of corporations had an effect on corporate debt of the time. As Donaldson found from the research, both corporations and financial institutions understood debt in conventional, traditional, ways. For the corporations, these ways could be hampering operations and strategy. The ways corporations were being hampered were unseen however unless they started looking at their books differently and became open to taking on debt differently. Donaldson's singular achievement was to see in the research ways in which corporations were being hampered and in thus propose a new way of regarding debt. This was a revolutionary step for the large majority of businesses. And for even the small number of businesses which were pursuing unconventional debt practices, Donaldson's studies and new perspective put these on solid ground giving better guidance. Donaldson's readings of the research reflect corporate managers' own statements (also part of the research) regarding their views on their company's financial analysis and debt. Managers are quoted, "Our management is essentially conservative."; "The word which describes our corporate image is 'dignified'."; "I supposed in a way we're lazy." The author treats these as "attitudes" -- as in a chapter "Management Attitudes to Non-Debt Sources" -- realizing that it is such "attitudes" more than what financial figures disclose or debt itself which colors practices about the fundamental business matter of debt. Donaldson brings into the open managers false sense of debt. This false sense is bound in with conventional, inherited concepts and images of a corporation having no relation to facts. Such conventional views are perpetuated by an aversion to risk. The less debt, the less risk, according to the prevailing precept. But Donaldson points out that managers who observe this actually often pursue greater risks in product development, entering new markets, mergers, and other activities. Corporate "attitudes" to debt since the book's 1961 publication attest to the deep influence of Donaldson's groundbreaking perspective. Consumer debt, the growth of credit cards, and other financial phenomena also evidence changed regard of debt found in Donaldson's work. The tipping of the balance to too much debt for many corporations and beyond cannot be attributed to the book however. For in urging new concepts and uses of debt for the better management of corporations, Donaldson also goes into determination and control of risks entailed in new types of debt. Gordon Donaldson retired in 1993 after close to 20 years at the Harvard Business School. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, Joseph Medel C. Martirez, Denise Marie Varquez, Philline Reluya, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2010. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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