/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/101019.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, October 19, 2010, Vol. 14, No. 290 Headlines 3 G PROPERTIES: Guaranty Action Sent Back to Wake County State Ct. AFC HOLDCO: Mitsui Unit to Dissolve Business AMARU INC: Posts $209,300 Net Loss in June 30 Quarter AMERICAN ACCESSORIES: Case Summary & 4 Largest Unsecured Creditors AMERICAN COMMERCE: Posts $124,000 Net Loss in August 31 Quarter AMERICAN INT'L: CEO Benmosche Receives 1,930 Restricted Shares AMERICAN INT'L: Fairholme Raises Stake to 26.6% Shares ASCEND PERFORMANCE: Moody's Withdraws 'B2' Corp. Family Rating AWR WHOLESALE: Voluntary Chapter 11 Case Summary BALOISE INSURANCE: Chapter 15 Case Summary BANKATLANTIC BANCORP: Faces NYSE Delisting as Stock Under $1.00 BEAR ISLAND: Court Declares Black Diamond Bid Best and Highest BEAVER BROOK: Default on $10.33MM Loan Prompts Chapter 22 BEDFORD TOWN: Washington Gas Sanctioned for Violating Stay BEHROOZ SUMEKH: Involuntary Chapter 11 Case Summary BLOCKBUSTER INC: Reveals $152.2 Mil. Loss for 8 Months BLOCKBUSTER INC: Starts Search for New Chief Executive BONSO ELECTRONICS: Posts $657,700 Net Loss in March 31 Quarter BRUCE BUCKNER: Case Summary & 8 Largest Unsecured Creditors BURGER KING: Tender Offer Cues Fitch's to Cut Long-Term IDR to B CAPMARK FINANCIAL: Creditors Argue Firm Overpaid Lenders CASCADES INC: DBRS Confirms Issuer Rating at 'BB' CASTAIC PARTNERS: Enters Chapter 11 in Los Angeles CATHOLIC CHURCH: Urges Court to Move Quickly on Diocese Appeal CEDAR FAIR: Moody's Retains 'Ba3' Rating with Stable Outlook CENTURION PROPERTIES: Can Use Cash Collateral Until Dec. 31 CENTURION PROPERTIES: Files Schedules of Assets & Liabilities CENTURION PROPERTIES: US Trustee Unable to Form Creditors' Panel CHEMTURA CORP: Court Establishes Reserve for Environmental Claims CHEMTURA CORP: Court Sets Diacetyl Reserve for $6.9 Million CHEMTURA CORP: Wins Approval of Andrews/Guild Diacetyl Pacts CHEMTURA CORP: Wins Nod for Burcham Diacetyl Settlement CITY INTERNATIONAL: Chapter 15 Case Summary CLOVERLEAF ENTERPRISES: Judge Opts to Assign Chapter 11 Trustee CRYSTAL CATHEDRAL: Files for Chapter 11 in California CRYSTAL CATHEDRAL: Case Summary & 20 Largest Unsecured Creditors CUSTOM CABLE: Counsel for Parent's Shareholders Asks to Withdraw DAVID DRUMM: Files for Chapter 7 in Boston DAYBREAK OIL: Incurs $370,100 Net Loss in August 31 Quarter DOWA INSURANCE: Chapter 15 Case Summary DRYSHIPS INC: Unit Signs Drilling Deal With Vanco Overseas DUNE ENERGY: Pays $500,000 to Amend Wells Fargo Credit Pact E.DIGITAL CORPORATION: Posts $350,200 Net Loss in June 30 Quarter EDUCATION RESOURCES: Settlement Allows Plan Confirmation EMMIS COMMS: Posts $70,000 Net Income in August 31 Quarter ENERGY FUTURE: Units Price Offering of $350MM 2nd Lien Notes ESBH INC: Voluntary Chapter 11 Case Summary EURAMAX HOLDINGS: Delays $175 Million Shares Offering EURAMAX HOLDINGS: Posts $22.9 Mil. Net Loss for 2010 First Half EXTENDED STAY: Settles Aecon Construction Claims EXTENDED STAY: Starwood Appeal Reimbursement Order FBL FINANCIAL: AM Best Affirms Issuer Credit Rating at "bb" FISHER COMMUNICATIONS: S&P Withdraws 'B-' Corp. Credit Rating FM AVIATION: Case Summary & 3 Largest Unsecured Creditors FONTAINEBLEAU LV: Ch. 7 Trustee Proposes RMS as Consultant FONTAINEBLEAU LV: Ch. 7 Trustee Wants Kasowitz as Special Counsel FONTAINEBLEAU LV: Waldman Withdraws as Resorts' Counsel FREDDIE MAC: Clayton Rose Elected to Board of Director FREDERICK BERG: Meridian Founder Charged With $350MM Fraud GENERAL GROWTH: Bankruptcy Court Allows Capital Raise GENERAL GROWTH: Names Members to Spin-Off's Board GENERAL GROWTH: Parties Lodge Objections, Support for Plan GLOBAL ENTERTAINMENT: Posts $566,000 Net Loss in August 31 Quarter HAWK CORP: S&P Shifts CreditWatch on 'B' Rating to Positive HENRY ANDERSON: Court Extends Cash Collateral Use Until Nov. 4 HERBALIFE INTERNATIONAL: Moody's Upgrades Default Rating to 'Ba1' INTELLIPHARMACEUTICS: Posts $2.1MM Net Loss in August 31 Quarter INTELSAT SA: Unit Completes Cash Tender Offers to Buy Sr. Notes ISTAR FINANCIAL: Files Financial Information of LNR Property JOHN FREDERICK DIXON: Court Slashes Wendel Rosen Fees K2 PURE: S&P Corrects Press Release; Puts 'B' Rating to Loan KAUFMAN PEBBLE: Involuntary Chapter 11 Case Summary KOWALLIS AND MACKEY: Voluntary Chapter 11 Case Summary LEHMAN BROTHERS: LBIE Seeks Court Ruling on $1 Bil. in Securities LEHMAN BROTHERS: LBSF & Primus Agree to Settle Claims LEHMAN BROTHERS: Sells 9.9 Million Edelweiss Shares LIONS GATE: S&P Shifts CreditWatch on 'B-' Rating to Developing LIQUIDMETAL TECH: Names Two New Members to Board of Directors LOUISIANA VALVE: Case Summary & 23 Largest Unsecured Creditors M & U LLC: Voluntary Chapter 11 Case Summary MAJESTIC LIQUOR: Plan Provides Full Satisfaction on Most Claims MEDCLEAN TECHNOLOGIES: Manatuck Reports 15.07% Equity Stake MEDICAL EDUCATIONAL: Court Decides on Chapter 11 Case Status Today MERUELO MADDUX: Investors Propose New Competing Plans METALINK LTD: Receives NASDAQ Notice of Noncompliance MICHAELS STORES: Has Private Placement for $800MM of Senior Notes MIDWEST BANC: 401(k) Plan Has Net Assets of $14.3MM at End of 2009 MOBILE COMMUNICATIONS: Voluntary Chapter 11 Case Summary NATIONAL CENTURY: White, et al, Win Nod for Distribution of Funds NAZIA ROSEHILL: Case Summary & Largest Unsecured Creditor NEW BERN: Asks for Oct. 30 Extension of Plan Filing Exclusivity NEW LEAF: Completes $2 Million Sale of Bridge Notes & Warrants OLD COLONY: Blames Demise on Steep Loan Interest Rate OPEN TEXT: S&P Raises Corporate Credit Rating to 'BB+' ORLEANS HOMEBUILDERS: CEO Leaving Post After $700,000 Payment PACIFIC AVENUE: Panel Gets OK to Tap O'Dea & Vann as Counsel PACIFIC AVENUE: Taps James McElroy as Counsel in Regions Bank Case POPULAR LIFE: AM Best Upgrades Issuer Credit Rating to "bb+" PRECISION OPTICS: Investors Extend Note's Due Date to November 15 QUALITY DISTRIBUTION: Moody's Keeps 'Caa1' Corp. Family Rating RADIENT PHARMACEUTICALS: Defaults Under 12% Convertible Notes RICHARD GETTY: U.S. Trustee Unable to Appoint Creditors Committee RICHARD MUNSON: Court Dismisses Credit Union Suit Over Land Rover RITE AID: 401(k) Plan Blackout Period Starts November 15 RIVER ROAD: Seeks to Appeal Ruling Favoring Credit Bidding SABRA HEALTH: Moody's Assigns 'B2' Rating on Senior Unsec. Notes SABRA HEALTH: S&P Assigns 'B' Corporate Credit Rating SEAGATE TECHNOLOGY: Fitch Puts 'BB+' Rating on Negative Watch SEAGATE TECHNOLOGY: Private Deal Won't Affect Moody's 'Ba1' Rating SEAGATE TECHNOLOGY: S&P Puts 'BB+' Rating on CreditWatch Negative SEALY CORP: Marketing VP Acquires 73,062 Unrestricted Shares SEVERN BANCORP: Reports $485,000 net Profit in Third Quarter SIMON WORLDWIDE: Panel Approves Dismissal of BDO USA as Accountant SIMON WORLDWIDE: Burkle's Overseas Toys Has $11-Mil. Buyout Offer SMART-TEK SOLUTIONS: J. Kinross-Kennedy Raises Going Concern Doubt SOUTH BAY: Asks for Plan Filing Exclusivity Until Feb. 15 SOUTH BAY: Removal Period Extended Until February 15 SOUTH BAY: SANDAG Contemplates Take Over SPARKLEBERRY EB: To Pay Creditors from Sale of Land SPARKLEBERRY EB: To Justify Reorganization Case on October 21 SPHERIS INC: CoMetrics Named Fin'l Advisor for SP Wind Down TBP CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors TEL-INSTRUMENT: NYSE Amex Accepts Continued Listing TELETOUCH COMMUNICATIONS: Posts $230,000 Net Loss in Aug. 31 Qtr. THOMPSON PUBLISHING: Bids Due By Nov. 12; Sale Hearing on Nov. 19 THORNBURG MORTGAGE: Orrick, Ex-Execs Fail to Stop Fraud Suit TIGRENT INC: Strudwick et al. Extend Forbearance Until Feb. 2011 TIX CORP: Echo Lake Opposes Plan to Delist Shares TODD'S INTERTHERM: Case Summary & 20 Largest Unsecured Creditors TRIBUNE CO: Arkin Kaplan, et al., Represent Step One Lenders TRIBUNE CO: Names Jerry Core VP/GM for KTXL-TV TRUST NO. 3645: Involuntary Chapter 11 Case Summary TURKPOWER CORP: Posts $429,300 Net Loss in August 31 Quarter TWIN CITY: Voluntary Chapter 11 Case Summary ULTIMATE ESCAPES: Gets Final Approval to Incur Loan and Use Cash ULTIMATE ESCAPES: October 29 Set as General Claims Bar Date ULTIMATE ESCAPES: Plan Contemplates Liquidation of All Assets ULTIMATE ESCAPES: Committee Taps FTI Consulting as Fin'l Advisor US FIDELIS: Wants Dec. 31 Extension of Plan Filing Exclusivity US FIDELIS: Proofs of Claim Deadline for Non-Consumers on Dec. 1 USEC INC: Amends & Restates Credit Agreement With JPMorgan Chase VIRTUAL GEOSATELLITE: Voluntary Chapter 11 Case Summary VWE GROUP: Court Dismisses Ponzi Scheme Claims as Time-Barred WASHINGTON MUTUAL: Wins Nod to Send Plan to Creditors for Voting WARNER MUSIC: Oaktree Capital Reports 6.1% Equity Stake WILLIAM NORRIE: Involuntary Chapter 11 Case Summary WORKSTREAM INC: Delays Filing of Quarterly Report on Form 10-Q YELLOWSTONE CLUB: Robert Sumpter Claim Reduced to $250,000 YURI PLYAM: Ch. 11 Case Dismissed at Request of Creditors * Aspatore Books Publishes Trends in Commercial Bankruptcy Filings * Wilson Sonsini & Rosati Expands Corporate Finance Practice * Bankruptcy Lawyers Field Calls From Troubled Municipalities * Large Companies With Insolvent Balance Sheets ********* 3 G PROPERTIES: Guaranty Action Sent Back to Wake County State Ct. ------------------------------------------------------------------ In In re: Southern Community Bank & Trust v. James D. Goldston, III, James M. Adams, Sr., Timothy P. Kelly, Lake Glad Road Commercial, LLC, and Lake Glad Road Partners, LLC, Defendants, Adv. Proc. No. 10-00178 (Bankr. E.D. N.C.), the Hon. J. Rich Leonard remands a guaranty action to the Superior Court of Wake County, North Carolina. In April 2010, plaintiff filed a complaint in Wake County Superior Court against defendants to recover sums owed under two separate loan agreements and promissory notes, and underlying guaranties. In total, the notes and guaranty agreements provide for the payment of roughly $6,700,000. The plaintiff commenced foreclosure proceedings in Granville County against tracts of land that serve as security under the notes. On June 14, 2010, Lake Glad Road Commercial, Lake Glad Road Partners, and a third entity known as Granville Park Partners, LLC, which was not a party to the guaranty action, filed Articles of Merger. The surviving entity is 3 G Properties, LLC. Defendants Goldston and Adams each have a 50% ownership interest in 3 G. On the same date as the merger, 3 G filed a petition for relief under chapter 11 of the Bankruptcy Code. On July 8, 2010, the plaintiff filed an amended complaint, removing Commercial and Partners as defendants in the guaranty action and adding John Patrick Williams and Toby Barnette, the other guarantors on the Commercial note, as defendants. Defendant Mr. Kelly along with Messrs. Williams and Barnette were each member/managers of Clear Creek, LLC, a member of Commercial, and additional guarantors on the Commercial note. On July 26, 2010, defendants Goldston and Adams filed a notice of removal in the bankruptcy court, listing themselves, defendant Mr. Kelly, Commercial and Partners as defendants. In response, the plaintiff requests that the court abstain from hearing the guaranty action. In remanding the lawsuit, Judge Leonard holds that the state court can timely adjudicate the plaintiff's guaranty action such that there will not be an unfavorable effect on the administration of the bankruptcy case. The guaranty action is not a core proceeding arising under or arising in a case under the Bankruptcy Code. Moreover, the guaranty action against the defendants does not invoke a substantive right created by federal bankruptcy law, but rather is based entirely on state law. A copy of the Court's Order dated Oct. 14, 2010, is available at http://is.gd/g6r5ufrom Leagle.com. Wake Forest, North Carolina-based 3 G Properties, LLC, dba Granville Park Partners, LLC, Lake Glad Road Commercial, LLC, dba Lake Glad Road Partners, LLC, filed for Chapter 11 bankruptcy protection on June 14, 2010 (Bankr. E.D. N.C. Case No. 10-04763). Gregory B. Crampton, Esq., and Kevin L. Sink, Esq., at Nicholls & Crampton, P.A., represent the Company in its restructuring effort. The Company estimated its assets and debts at $10 million to $50 million as of the Petition Date. AFC HOLDCO: Mitsui Unit to Dissolve Business -------------------------------------------- Mitsui & Co., Ltd. disclosed that its subsidiary, AFC HoldCo, LLC, resolved to dissolve the business and plans to complete the liquidation. AFC HoldCo, LLC's representative officer is Masahiko Kurahashi. Major shareholder of the company is Mitsui & Co. (U.S.A.), Inc. (A wholly owned subsidiary of Mitsui) 87.5% As a result of the business performance review, Mitsui judged that its subsidiaries' auto finance business would be unprofitable under the current severe market conditions and determined to dissolve the company. Schedule for the resolution of dissolution is on October 12, 2010 and the beginning of 2011 the Completion of liquidation. This dissolution will have minimal impact on Mitsui's consolidated financial statements for the year ending March 31, 2011. AMARU INC: Posts $209,300 Net Loss in June 30 Quarter ----------------------------------------------------- Amaru Inc. filed on October 15, 2010, an amended quarterly report for the three months ended June 30, 2010. The Company reported a net loss of $209,323 on $38,753 of revenue for the second quarter ended June 30, 2010, compared to a net loss of $483,112 on $14,007 of revenue for the same period in 2009. The Company incurred a loss from operations of $407,618 for the three months ended June 30, 2010, as compared to a loss from operations of $744,466 for three months ended June 30, 2009. The decrease in operating loss is due mainly as a result of cost reduction measures to reduce operating costs. The Company's balance sheet at June 30, 2010, showed $4.3 million in total assets, $3.5 million in total liabilities, and stockholders' equity of $751,139. Mendoza Berger & Company, LLP, in Irvine, California, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's financial results for 2009. The independent auditors noted that the Company has sustained accumulated losses from operations totaling $37.4 million at December 31, 2009. A full-text copy of the Form 10-Q/A-1 is available for free at: http://researcharchives.com/t/s?6c96 About Amaru Inc. Singapore-based Amaru Inc. provides entertainment-on-demand and e- commerce channels on Broadband, and 3G devices. The Company delivers both wire and wireless solutions, streaming via computers, TV sets, PDAs and 3G hand phones. The Company launches e-commerce channels (portals) that provide on-line shopping but with a difference, merging two leisure activities of shopping and entertainment. AMERICAN ACCESSORIES: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: American Accessories Holdings, L.P. Mark Weisbart, Trustee for American Accessories, Inc., G.P. 12770 Coit Road, Suite 541 Dallas, TX 75251 Bankruptcy Case No.: 10-43534 Chapter 11 Petition Date: October 12, 2010 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Judge: Brenda T. Rhoades Debtor's Counsel: Mark A. Weisbart, Esq. THE LAW OFFICES OF MARK A. WEISBART 12770 Coit Road, Suite 541 Dallas, TX 75251 Tel: (972) 628-3694 Fax: (972) 628-3687 E-mail: weisbartm@earthlink.net Scheduled Assets: $450,000 Scheduled Debts: $1,804,003 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txeb10-43534.pdf The petition was signed by Mark Weisbart, trustee for American Accessories, Inc., general partner. AMERICAN COMMERCE: Posts $124,000 Net Loss in August 31 Quarter --------------------------------------------------------------- American Commerce Solutions, Inc., filed on October 15, 2010, its quarterly report on Form 10-Q, reporting a net loss available to common stockholders of $124,013 on $538,135 of revenue for the three months ended August 31, 2010, compared with net income available to common stockholders of $1.2 million on $549,477 of revenue for the same period ended August 31, 2009. The Company incurred a net consolidated loss from continuing operations of $124,013 for the three months ended August 31, 2010, compared to a loss of $154,073 for the three months ended August 31, 2009. Current liabilities exceed current assets by approximately $914,100 at August 31, 2010. Additionally, the Company is in default on several notes payable. The Company's balance sheet at August 31, 2010, showed $5.1 million in total assets, $4.5 million in total liabilities, and stockholders' equity of $659,197. As reported in the Troubled Company Reporter on June 4, 2010, Peter Messineo, CPA, of Palm Harbor, Florida, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended February 28, 2010. The independent auditor noted that the Company has incurred recurring losses from continuing operations, has negative working capital and has used significant cash in support of its operating activities. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6ca4 About American Commerce Bartow, Fla.-based American Commerce Solutions, Inc., is primarily a holding company with two wholly owned subsidiaries. One subsidiary, International Machine and Welding, Inc., is engaged in the machining and fabrication of parts used in heavy industry, and parts sales and service for heavy construction equipment. The second subsidiary, Chariot Manufacturing Company, which was acquired on October 11, 2003, from a related party, manufactures motorcycle trailers with fiberglass bodies and other fiberglass parts by contract with affiliate owned, Tampa Fiberglass, Inc. Effective June 1, 2009, Chariot was sold and is classified as a discontinued operation. AMERICAN INT'L: CEO Benmosche Receives 1,930 Restricted Shares -------------------------------------------------------------- Robert H. Benmosche, President and CEO of American International Group, Inc., disclosed that on October 14 he acquired 1,930 shares of common stock raising his stake to 78,375 shares. He directly holds those shares. The shares are restricted from transfer until August 10, 2014, pursuant to the 2009-2010 Stock Salary Award Agreement with the Company dated November 24, 2009. The award reflects 3,668 shares less 1,738 shares withheld for taxes. About AIG American International Group, Inc. -- http://www.aig.com/-- is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. AIG almost collapsed under the weight of bad bets it made insuring mortgage- backed securities. The Company, however, was bailed out by the Federal Reserve, but even after an initial infusion of $85 billion, losses continued to grow. The later rescue packages brought the total to $182 billion, making it the biggest federal bailout in U.S. history. AIG has been working to protect and enhance the value of its key businesses, execute an orderly asset disposition plan, and position itself for the future. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. AMERICAN INT'L: Fairholme Raises Stake to 26.6% Shares ------------------------------------------------------ Fairholme Capital Management LLC said in a regulatory filing that as of October 14 it may be deemed to be the beneficial owner of 36,657,349 shares or 26.6% of the common stock of American International Group Inc. The amount assumes Fairholme has converted 95% of the AIG preferred shares it held into common stock. Fairholme Fund Inc. may be deemed to be the beneficial owner of 32,824,976 AIG Shares -- 23.8% -- and Bruce R. Berkowitz may be deemed to be the beneficial owner of 36,657,349 AIG Shares -- 26.6% -- based upon the 137,939,277 AIG Shares outstanding. Earlier this month, Fairholme disclosed that as of October 4, 2010, it may be deemed to beneficially own 32,909,500 AIG shares or roughly 24.4%. About AIG American International Group, Inc. -- http://www.aig.com/-- is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. AIG almost collapsed under the weight of bad bets it made insuring mortgage- backed securities. The Company, however, was bailed out by the Federal Reserve, but even after an initial infusion of $85 billion, losses continued to grow. The later rescue packages brought the total to $182 billion, making it the biggest federal bailout in U.S. history. AIG has been working to protect and enhance the value of its key businesses, execute an orderly asset disposition plan, and position itself for the future. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. ASCEND PERFORMANCE: Moody's Withdraws 'B2' Corp. Family Rating -------------------------------------------------------------- Moody's Investors Service withdrew the ratings for Ascend Performance Materials Holdings, Inc., following APMH's postponement of several debt transactions. APMH has no rated debt at this time. The ratings withdrawn are the B2 Corporate Family Rating; the B2 Probability of Default Rating; and the B2 (LGD4, 55%) rating on the proposed $800 million guaranteed secured Term Loan B due 2016 to be issued by Ascend Performance Materials LLC. Issuer: Ascend Performance Materials Holdings, Inc. Withdrawals: -- Corporate Family Rating, Withdrawn, previously rated B2 -- Probability of Default Rating, Withdrawn, previously rated B2 Issuer: Ascend Performance Materials LLC Withdrawals: -- Senior Secured Bank Credit Facility, Withdrawn, previously rated B2, LGD4, 55% Moody's last rating action affecting APMH occurred on September 29, 2010, when Moody's assigned an initial B2 CFR and a B2 rating to Ascend's proposed term loan B. APMH is a privately held major integrated Nylon 6,6 manufacturer based in Houston, Texas. AWR WHOLESALE: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: AWR Wholesale, Inc. aka Alan Moss 436 Lafayette Street New York, NY 10003 Bankruptcy Case No.: 10-15254 Chapter 11 Petition Date: October 6, 2010 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Burton R. Lifland Debtor's Counsel: Gilbert A. Lazarus, Esq. LAZARUS & LAZARUS, P.C. 240 Madison Avenue, 8th Floor New York, NY 10016 Tel: (212) 889-7400 Fax: (212) 684-0314 E-mail: glawlazarus@aol.com Estimated Assets: $100,001 to $500,000 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 Alan R. Moss, president. BALOISE INSURANCE: Chapter 15 Case Summary ------------------------------------------ Chapter 15 Petitioner: Toby Wooldridge Chapter 15 Debtor: Baloise Insurance Ltd. aka The Baloise Insurance Company Limited Aeschengraben 21, Box 2275 CH-4002 Basle Switzerland Chapter 15 Case No.: 10-15358 Type of Business: The Debtor is one of the largest Swiss insurance groups which offers cargo insurance services. Chapter 15 Petition Date: October 14, 2010 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Judge: James M. Peck Chapter 15 Petitioner's Counsel: Kenneth P. Coleman, Esq. ALLEN & OVERY LLP 1221 Avenue of Americas New York, NY 10022 Tel: (212) 610-6300 Fax: (212) 610-6399 Estimated Assets: $0 to $50,000 Estimated Assets: $100,001 to $500,000 The Company did not file a list of creditors together with its petition. BANKATLANTIC BANCORP: Faces NYSE Delisting as Stock Under $1.00 --------------------------------------------------------------- BankAtlantic Bancorp Inc. was notified on October 12, 2010, by NYSE Regulation Inc. that the Company's Class A Common Stock did not satisfy one of the New York Stock Exchange standards for continued listing. The NYSE requires a listed company's stock to maintain an average closing price per share in excess of $1.00 for a consecutive 30- trading-day period. As of October 1, 2010, the average closing price per share of the Company's Class A Common Stock over the preceding 30-trading-day period was $0.99. Under the NYSE's rules, the Company has a period of six months, subject to possible extension, to bring its share price and 30- trading-day average share price back over $1.00. The Company's Class A Common Stock will continue to be listed and traded on the NYSE during this period, subject to the Company's compliance with other continued listing standards of the NYSE. The Company intends to provide notification to the NYSE of its intent to regain compliance and steps it will take to attempt to do so. There is no assurance that the Company will be able to satisfy the NYSE's requirement within the six-month cure period and maintain the listing of its Class A Common Stock. About BankAtlantic Bancorp BankAtlantic Bancorp (NYSE: BBX) -- http://www.BankAtlanticBancorp.com/-- is a bank holding company and the parent company of BankAtlantic. BankAtlantic -- "Florida's Most Convenient Bank" with a Web presence at http://www.BankAtlantic.com-- has nearly $6.0 billion in assets and more than 100 stores, and is one of the largest financial institutions headquartered junior in Florida. BankAtlantic has been serving communities throughout Florida since 1952 and currently operates more than 250 conveniently located ATMs. BankAtlantic Bancorp's balance sheet showed $4.656 billion in assets and $4.578 billion in liabilities at June 30, 2010. * * * In September 2010, Fitch Ratings downgraded the long-term Issuer Default Ratings of BankAtlantic Bancorp. to 'CC' from 'B-' and its primary operating subsidiary, BankAtlantic FSB to 'CC' from 'B+. The 'CC' long-term IDR indicates a high default probability. Fitch said it believes that BBX will likely require external capital support given the high level of credit costs that continue to impact BBX's financial performance and erode its existing weak level of tangible common equity, which stood at just 1.39% at June 30, 2010. Although BFSB's regulatory capital levels remain 'well-capitalized', Fitch believes the company needs additional capital in order to provide absorption for future losses, particularly since earnings generation on a pre-provision net revenue basis is weak. BEAR ISLAND: Court Declares Black Diamond Bid Best and Highest -------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Virginia approved the sale of declared Black Diamond Capital Management LLC's bid to be the highest and best bid to buy Bear Island Paper Co. LLC, and its Canadian parent, White Birch Paper Co. According to the Court's docket, the bankruptcy judge affirmed Black Diamond as the winning at the sale hearing held October 13, 2010. As reported in the Troubled Company Reporter on September 30, the Company selected as the winning bid the offer from the stalking horse bidder, a group comprised of Black Diamond Capital Management LLC, Credit Suisse Group AG, and Caspian Capital Advisors LLC, holders of 65% of the $438 million in first-lien debt. The losing bidder, a group holding 22% of the first-lien debt, however, contends that they submitted the superior bid at the auction. Black Diamond's winning bid consisted (i) a $90 million cash payment, allocated to the current assets, (ii) $4.5 million cash payment, allocated to the fixed assets owned by the Canadian affiliates; and a (iii) $78 million credit bid allocated to the fixed assets owned by the Canadian affiliates. About White Birch & Bear Island Canada-based White Birch Paper Company is the second-largest newsprint producer in North America. As of December 31, 2009, the White Birch Group held a 12% share of the North American newsprint market and employed roughly 1,300 individuals (the majority of which reside in Canada). Bear Island Paper Company, L.L.C., is a U.S.-based unit of White Birch. Bear Island filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No. 10-31202) on February 24, 2010. Bear Island estimated assets of $100 million to $500 million and debts of $500 million to $1 billion in its Chapter 11 petition. White Birch filed for bankruptcy protection under Canada's Companies' Creditors Arrangement Act, before the Superior Court for the Province of Quebec, Commercial Division, Judicial District of Montreal, Canada. White Birch and five other affiliates -- F.F. Soucy Limited Partnership; F.F. Soucy, Inc. & Partners, Limited Partnership; Papier Masson Ltee; Stadacona Limited Partnership; and Stadacona General Partner, Inc. -- also sought bankruptcy protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. E.D. Va. Case No. 10-31234). Jonathan L. Hauser, Esq., at Troutman Sanders LLP, in Virginia Beach, Virginia; and Richard M. Cieri, Esq., Christopher J. Marcus, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP, in New York, serve as counsel to White Birch, as Foreign Representative. Kirkland & Ellis and Troutman Sanders also serve as Chapter 11 counsel to Bear Island. AlixPartners LLP serves as financial and restructuring advisors to Bear Island, and Lazard Freres & Co., serves as investment banker. Garden City Group is the claims and notice agent. Chief Judge Douglas O. Tice, Jr., handles the Chapter 11 and Chapter 15 cases. BEAVER BROOK: Default on $10.33MM Loan Prompts Chapter 22 --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Beaver Brook Village LLC filed for Chapter 11 bankruptcy protection after defaulting on a $10.3 million mortgage with Wells Fargo Bank NA. Mr. Rochelle relates that Beaver Brook owes $1 million to creditors under a prior Chapter 11 case that concluded in late 2008 with a confirmed reorganization plan. Payments under the prior plan are also in default. The Company said cash flow has continued to decline since the first reorganization. Beaver Brook Village LLC is the owner of a mixed-use real estate development in Dracut, Massachusetts. The project has 47 apartments and 30 commercial units on 6.5 acres. Beaver Brook filed for Chapter 11 protection on Oct. 11, 2010 (Bankr. D. Mass. Case No. 10-45054). Edward C. Dial, Jr., Esq., and Jeffrey A. Schreiber, Esq., at The Schreiber Law Firm, LLC, in Salem, New Hampshire, serves as counsel to the Debtor. In its schedules, the Debtor disclosed assets of $7,892,937 and debts of $11,282,013. Beaver Brook first filed for Chapter 11 on August 10, 2007 (Bankr. D. Mass. Case No. 07-43103). William H. Harris, Esq., at Harris & Dial, P.C., in North Andover, Massachusetts, served as Debtor's counsel. In its prior petition, the Debtor listed $12,019,803 in assets and $14,365,086 in debts. BEDFORD TOWN: Washington Gas Sanctioned for Violating Stay ---------------------------------------------------------- The Hon. Thomas J. Catliota of the United States Bankruptcy Court, D. Maryland sanctioned Washington Gas Co. -- at the behest of Bedford Town Condominium -- for violation of the automatic stay. On April 16, 2010, Washington Gas sent the Debtor a notice of its intention to terminate gas service on or after April 30, 2010 -- despite receiving notice of the Debtor's bankruptcy case. The Court awarded Bedford Town damages of $1,975. A copy of the Court's memorandum of decision, dated Sept. 20, is available at: http://www.leagle.com/unsecure/page.htm?shortname=inbco20100920357 Bedford Town Condominium Association aka The Marylander sought chapter 11 protection (Bankr. D. Md. Case No. 10-15831) on March 19, 2010, estimating under $50,000 in assets and $500,000 to $1 million in debts. John D. Burns, Esq., at The Burns LawFirm, LLC -- burnslaw@burnslaw.algxmail.com -- in Greenbelt, Maryland, serves as counsel to the Debtor. A copy of the Debtor's chapter 11 petition is available at http://bankrupt.com/misc/mdb10- 15831.pdf at no charge. BEHROOZ SUMEKH: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: Behrooz Sumekh 639 W. Camino Real Arcadia, CA 91007 Bankruptcy Case No.: 10-54048 Involuntary Chapter 11 Petition Date: October 13, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Victoria S. Kaufman Debtor's Counsel: Pro Se Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Daniel Lamden Loan $390,000 1508 Greenfield Avenue, # 408 Los Angeles, CA 90025 Samuel Torbati Loan $350,000 435 N. Oakhurst Drive, # 404 Beverly Hills, CA 90210 BLOCKBUSTER INC: Reveals $152.2 Mil. Loss for 8 Months ------------------------------------------------------ In connection with the negotiation of the pre-arranged recapitalization plan of Blockbuster Inc., certain holders of its 11.75% senior secured notes conducted a due diligence review of the Company, according to a Form 8-K filed with the U.S. Securities and Exchange Commission dated October 12, 2010. As part of the due diligence review, the Restricted Noteholders received certain financial projections for the Company, relates Rod McDonald, Esq., Blockbuster's vice president, secretary and general counsel. Pursuant to confidentiality agreements entered into with the Restricted Noteholders, Blockbuster agreed to disclose a summary of any material non-public information previously disclosed to the Restricted Noteholders. As a result, the Company has included a summary of the projections that it provided to the Restricted Noteholders in its SEC filing, solely to comply with its obligations to the Restricted Noteholders under the confidentiality agreements. Condensed Consolidated Statement of Operations 34 Weeks Ended August 29, 2010 (In Millions) Condensed consolidated statement of operations: Total revenue $2,194.1 Cost of sales 990.7 ------- Gross profit 1,203.4 Operating expenses: General and administrative 1,165.7 Advertising 37.4 Depreciation & intangible amortization 66.0 ------- Operating loss (65.7) Interest and other income, net (85.6) ------- Loss from continuing operations (151.3) before income taxes Provision for income taxes 0.6 ------- Loss from continuing operations (151.9) Loss from discontinued operations 0.3 ------- Net loss ($152.2) ======= Reconciliation of adjusted EBITDA: Net loss ($152.2) Adjustments to reconcile net loss to adjusted EBITDA: Loss from discontinued operations, net 0.3 Provision for income taxes 0.6 Interest and other income, net 85.6 Depreciation & intangible amortization 66.0 ------- EBITDA 0.3 Lease termination costs incurred for store closures 36.1 Severance costs 12.5 Stock compensation 0.7 Net gain on a third party games sale (non-recurring) (7.7) Professional fees related to recapitalization costs (non-recurring) 14.9 ------- Adjusted EBITDA $56.8 ======= Mr. McDonald asserts that the Projections were provided solely in connection with the Restricted Noteholders' due diligence review and not expressly for inclusion in the Form 8-K filing or any other public document. The Projections are subject to numerous assumptions, risks and limitations, and are now out of date, do not reflect the Company's current plan or capital structure under consideration, and are subject to substantial revision, Mr. McDonald contends. He also notes that the Projections are not a guaranty of future performance, and actual results may differ from the Projections and the differences may be material. Mr. MacDonald adds, among other things, that the Projections do not purport to present the Company's financial condition in accordance with accounting principles generally accepted in the United States of America. About Blockbuster Inc. Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA, BLOKB) -- http://www.blockbuster.com/-- is a global provider of rental and retail movie and game entertainment. It has a library of more than 125,000 movie and game titles. Blockbuster said it had assets of $1,017,035,832 and debts of $1,464,939,759 as of August 1, 2010. Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan on September 23, 2010 (Bankr. S.D.N.Y. Case No. 10-14997). Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. A steering group of senior secured noteholders is represented by James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin LLP. U.S. Bank National Association as trustee and collateral agent for the senior secured notes is represented by David McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter & Hampton LLP. BDO Consulting is the financial advisor for U.S. Bank. Lenders led by Wilmington Trust FSB are providing the DIP financing. The DIP Agent is represented by Peter Neckles, Esq. and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York. Blockbuster's non-U.S. operations and its domestic and international franchisees, all of which are legally separate entities, were not included in the filings and are not parties to the Chapter 11 proceedings. Bankruptcy Creditors' Service, Inc., publishes BLOCKBUSTER BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Blockbuster Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) BLOCKBUSTER INC: Starts Search for New Chief Executive ------------------------------------------------------ Blockbuster Inc. has commenced search for a new chief executive officer to replace present CEO, James Keyes, The Wall Street Journal reports. Joann S. Lublin and Mike Spector of WSJ report that Blockbuster has hired an executive-search firm, Korn/Ferry International, to look at new blood to run the company after it emerges from bankruptcy protection. Mr. Keyes was named CEO in 2007, and a candidate to continue leading Blockbuster, WSJ says citing unnamed people familiar with the matter. According to the report, some creditors are dissatisfied with Mr. Keyes, and want to identify candidates, who can steer Blockbuster into digital businesses. The company's senior bondholders, including Carl Icahn, will have to approve the new CEO choice by December 31, 2010, under the prepetition restructuring deal negotiated by key parties, notes the report. An unnamed company spokeswoman is quoted as saying that the search is "moving forward with what is consistent with our public disclosures and the requirements of the recapitalization plan. Jim remains fully engaged and committed to the business and the plan. This includes active participation in any evaluation of potential CEO candidates." An unnamed source has also said that Mr. Keyes supports the CEO search, says the Journal. The WSJ report also says that potential prospects may include former executives from Yahoo Inc., Google Inc. and Amazon.com Inc., who got wealthy from those employers but have not been a CEO. About Blockbuster Inc. Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA, BLOKB) -- http://www.blockbuster.com/-- is a global provider of rental and retail movie and game entertainment. It has a library of more than 125,000 movie and game titles. Blockbuster said it had assets of $1,017,035,832 and debts of $1,464,939,759 as of August 1, 2010. Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan on September 23, 2010 (Bankr. S.D.N.Y. Case No. 10-14997). Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. A steering group of senior secured noteholders is represented by James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin LLP. U.S. Bank National Association as trustee and collateral agent for the senior secured notes is represented by David McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter & Hampton LLP. BDO Consulting is the financial advisor for U.S. Bank. Lenders led by Wilmington Trust FSB are providing the DIP financing. The DIP Agent is represented by Peter Neckles, Esq. and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York. Blockbuster's non-U.S. operations and its domestic and international franchisees, all of which are legally separate entities, were not included in the filings and are not parties to the Chapter 11 proceedings. Bankruptcy Creditors' Service, Inc., publishes BLOCKBUSTER BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Blockbuster Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) BONSO ELECTRONICS: Posts $657,700 Net Loss in March 31 Quarter -------------------------------------------------------------- Bonso Electronics International Inc. filed on October 15, 2010, its annual report on Form 20-F for the fiscal year ended March 31, 2010. The Company reported a net loss of $657,680 on $28.5 million of revenue for fiscal 2010, compared with a net loss of $7.6 million on $40.4 million of revenue for fiscal 2009. The decrease in sales was primarily the result of decreased demand for the Company's telecommunication products and consumer electronics scales products. The Company's balance sheet at March 31, 2010, showed $23.7 million in total assets, $10.5 million in total liabilities, and stockholders' equity of $13.2 million. The Group has sustained operating losses in each of the fiscal years ended March 31, 2008, 2009, and 2010. A full-text copy of the Form 20-F is available for free at: http://researcharchives.com/t/s?6ca1 About Bonso Electronics Shatin, Hong Kong-based Bonso Electronics International Inc. (NasdaqCM: BNSO:) -- http://www.bonso.com/-- designs, develops, produces and sells electronic sensor-based and wireless products for private label original equipment manufacturers, original brand manufacturers and original design manufacturers. Since 1989, the Company has manufactured all of its products in China in order to take advantage of the lower overhead costs and competitive labor rates. The Company's factory is currently located in Shenzhen, China, about 50 miles from Hong Kong. BRUCE BUCKNER: Case Summary & 8 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Bruce Wayne Buckner dba Lakeside Deli dba Stratton Laundry Service & Center 1838 Industrial Drive Monterey, TN 38574 Bankruptcy Case No.: 10-10963 Chapter 11 Petition Date: October 11, 2010 Court: United States Bankruptcy Court Middle District of Tennessee (Cookeville) Judge: George C. Paine II Debtor's Counsel: Steven L. Lefkovitz, Esq. LAW OFFICES LEFKOVITZ & LEFKOVITZ 618 Church St., Ste 410 Nashville, TN 37219 Tel: (615) 256-8300 Fax: (615) 255-4516 E-mail: slefkovitz@lefkovitz.com Scheduled Assets: $1,034,565 Scheduled Debts: $324,195 A list of the Debtor's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/tnmb10-10963.pdf BURGER KING: Tender Offer Cues Fitch's to Cut Long-Term IDR to B ----------------------------------------------------------------- In conjunction with the expiration of 3G Capital's tender offer, Fitch Ratings has taken various rating actions on Burger King Holdings, Inc., and its wholly-owned operating subsidiary Burger King Corporation. Fitch has downgraded these: Burger King Corporation -- Long-term Issuer Default Rating to 'B' from 'B+'. Fitch has assigned these ratings: Burger King Holdings, Inc. -- Long-term IDR 'B'; -- $150 million secured revolving facility 'BB-/RR2'; -- $1.850 billion secured term loan facility 'BB-/RR2'; -- $800 million senior unsecured notes 'CCC/RR6'. Fitch has also withdrawn its 'BB+/RR1' rating on Burger King Corporation's secured bank facility which is being repaid as a result of the buy-out. The Rating Outlook is Stable. As previously mentioned, these actions follow the completion of 3G Capital's tender offer for all the outstanding shares of Burger King's stock at $24/share or $3.3 billion and resolves the Negative Rating Watch Fitch placed on Burger King's ratings on Sept. 2, 2010. Fitch downgraded Burger King Corporation's IDR to 'B+' from 'BB' on Sept. 2, 2010 following the company's definitive agreement to be acquired by 3G Capital in a transaction valued at approximately $4.1 billion, including the assumption of roughly $800 million of debt and capital leases. 3G is providing roughly $1.5 billion of equity capital and Burger King will have approximately $2.7 billion of debt when the transaction closes later this month. Financing to fund the buyout includes a $1.85 billion six-year term loan, a portion of its new $150 million five-year revolver and $800 million of 9.875% senior unsecured notes due Oct. 15, 2018. The debt was issued by merger subsidiary -- Blue Acquisition Sub, Inc. -- but upon consummation of the transaction, Burger King will assume all of the obligations. The new secured bank facility subjects the company to various financial covenants, including a maximum leverage ratio, a minimum interest coverage ratio and a leverage-based maximum yearly capital expenditure restriction. Terms also include mandatory prepayments with a percentage of excess free cash flow as defined by the agreement. The bank debt is secured on a first priority basis by a perfected security interest in all tangible and intangible assets of Burger King Corporation and is guaranteed by Burger King Holdings and all material wholly-owned domestic subsidiaries of Burger King Corporation. The $800 million of 9.875% senior unsecured notes are also guaranteed by Burger King Holdings, Inc., and all domestic subsidiaries and contain a change of control put option. The ratings reflect Burger King's high financial leverage, its positive free cash flow (FCF- defined as cash flow from operations less capital expenditures and dividends) and its competitive market position in the global quick-service restaurant industry. Total adjusted debt-to-operating EBITDAR (defined as total debt plus eight times gross rent expense-to-earnings before interest, taxes, depreciation, amortization and gross rents) pro forma for the leveraged buyout is approximately 6.5x, up from 3.5x at June 30, 2010. Since fiscal 2007, Burger King's FCF has grown at a 13% compound annual growth rate to $126 million in fiscal 2010 as operating income growth has been complemented by recent reductions in capital expenditures. Although same-store sales (SSS) performance weakened and the company has lost market share over the past two years, Burger King remains the third largest sandwich chain in the U.S. according to Nation's Restaurant New's Annual Top 100 ranking with approximately 10% market share, 12,174 units worldwide and roughly $15 billion of systemwide sales. The 'RR2' Recovery Rating on Burger King's $1.850 billion of secured debt indicates that Fitch views recovery prospects on these obligations as superior at 71%-90%. While not anticipated, the 'RR6' rating assigned to Burger King's senior unsecured notes reflects Fitch's opinion that recovery prospects would be below 10% if the bonds went into default. Fitch's recovery analysis is based on the assumption that the company's going concern enterprise value in a distressed situation would be approximately $1.7 billion or about 60% below the $4.1 billion value of the recent buyout. At June 30, 2010, 38% of Burger King's 12,174 restaurants were located outside of the North America and 89% were franchised while 11% were company operated. New management plans to refranchise half of the 1,339 company operated units over the next three to five years and to focus on international expansion. Fitch expects these efforts to be accretive to margins since franchised stores generate a higher margin and food-away-from-home expenditures are growing faster outside the U.S. However, Fitch is also mindful of risks associated with a highly franchised system, such as engaging in long-term contracts with franchisees that are not effective operators and the franchisor having less influence over the overall direction of the brand. 3G plans to reduce capital expenditures from $150 million in fiscal 2010 to maintenance levels or approximately $22 million beginning in fiscal 2011. The combination of significantly reduced capital expenditures and an acceleration of refranchising should significantly increase consolidated margins and FCF in the near-to-intermediate term. As such, Fitch projects that Burger King can generate free cash flow in excess of $200 million in fiscal 2011 and 2012 and maintain adequate liquidity, despite higher interest costs. Given 3G's history of reducing both cost and financial leverage for companies that it has acquired, adjusted leverage could fall to the mid-5.0x level within the next 24 months if this discretionary cash is used for debt repayment versus cash payouts and the operations don't deteriorate. Fitch views management's plan to refranchise nearly 700 company operated restaurants over the next five years as aggressive but recognizes that the environment for these transactions is improving due to greater access to capital. If management is unable to execute its operating strategy, Burger King continues to lose market share, financial policies are more aggressive than Fitch anticipates and adjusted leverage consistently remains materially above pro forma levels, ratings will be reviewed for a downgrade. Fitch remains concerned about the need for Burger King to broaden its appeal to a wider array of consumers by refreshing its restaurants, its marketing and its food offerings. Since the inception of the company's re-imaging program two and a half years ago, the company has only remodeled 170 or about 13% of its company units. Fitch views the company's barbell menu of value and premium food items and focus on enhanced breakfast offerings, such as the breakfast platters, Seattle's Best coffee and mini blueberry biscuits, as steps in the right direction. However, a lack of investment into the brand and continued high levels of unemployment among Burger King's core customer demographic, which skews younger and more male, could cause the company's SSS to continue to lag competitors. CAPMARK FINANCIAL: Creditors Argue Firm Overpaid Lenders -------------------------------------------------------- Bankruptcy Law360 reports that unsecured creditors in Capmark Financial Group Inc.'s bankruptcy argued Friday that the debtor is overpaying for a mortgage pool in a proposed $975 million settlement with secured lenders on a $1.5 billion loan. Law360 says the official committee of unsecured creditors made its case at an evidentiary hearing in the U.S. Bankruptcy Court for the District of Delaware. About Capmark Financial Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- provides financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. Capmark has 1,000 employees located in 37 offices worldwide. On October 25, 2009, Capmark Financial and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 (Bankr. D. Del. Lead Case No. 09-13684). Capmark disclosed assets of US$20 billion against total debts of US$21 billion as of June 30, 2009. Capmark's financial advisors are Lazard Freres & Co. LLC and Loughlin Meghji + Company. Capmark's bankruptcy counsel is Dewey & LeBoeuf LLP. Richards, Layton & Finger, P.A., serves as local counsel. Beekman Advisors, Inc., is serving as strategic advisor. KPMG LLP is tax and accounting advisor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. Protech Holdings C, LLC, an affiliate of Capmark, filed for Chapter 11 protection on July 29, 2010 (Bankr. D. Del. Case No. 10-12387). The Debtor estimated assets and debts in excess of $1 billion as of the filing date. Since filing in Chapter 11, Capmark completed three sales to generate more than $1 billion cash. Berkshire Hathaway Inc. and Leucadia National Corp. bought most of the business for $468 million. CASCADES INC: DBRS Confirms Issuer Rating at 'BB' ------------------------------------------------- DBRS has confirmed the Issuer Rating and the Senior Unsecured Debt rating of Cascades Inc. (Cascades or the Company), both at BB (high). The trend has been changed to Stable from Negative, recognizing that the Company has stabilized its financial profile through a severe recession in the North American economy. With the North American economy on the mend, albeit at a weak pace, DBRS expects Cascades' financial profile to remain near current levels in the medium term. Additionally, the current rating continues to be supported by the Company's solid business profile with a leading market position in a number of its businesses. The Company's operating results were weighed down by deteriorating market conditions in 2008. The ratings were placed on a Negative trend in March 2009 to reflect DBRS's concerns at that time about the Company's aggressive leverage and the potential impact of a severe recession on its already weak financial profile. The Company has done a good job in managing its operations during the recession. A combination of lower material and energy costs, benefits from cost improvement initiatives and a weaker Canadian dollar have more than offset the decline in volume and prices. The Company has reversed the declining trend and reported a marked improvement in its operating results from the weak levels prior to 2009. DBRS believes that the low point of this cycle is behind the industry and market conditions are likely to continue to improve, albeit modestly, in the near- to medium-term. Moreover, the narrowing of the spread between selling prices and raw material costs, which weighed on H1 2010 results, appears to have reversed. Hence, DBRS expects the Company's operating performance to improve for the remainder of the year. The Company's financial profile is expected to remain compatible with the rating, albeit slightly weaker than 2009. Furthermore, DBRS expects the Company to report stronger results in 2011 in line with an anticipated uptrend in the general economy. In 2009, Cascades strengthened its balance sheet using free cash flow to pay down debt, and all debt coverage metrics also showed improvement. The current rating continues to be underpinned by the Company's solid business profile. Cascades' value added packaging, specialty product sales mix and high containerboard converting integration levels (a strategy that has improved earnings stability through industry cycles relative to producers with a larger proportion of commodity products and limited integration) reduces business risk. In addition, contributions from a sizeable, higher margin and comparatively less volatile tissue business further enhance earnings stability. In addition to the improved debt coverage ratios, the Company continues to have good liquidity with cash and available liquidity totalling $422 million at the end of June 2010. In addition, the Company has a modest debt maturity schedule which adds to its financial flexibility. DBRS expects the Company's financial profile to remain relatively stable in the medium term. On March 11, 2010, the Company announced a share repurchase program to buy up to 4.85 million shares, and Cascades spent $2.2 million in Q2 2010 (about $4 million in 2009) buying back shares. However, DBRS expects the Company to remain committed to strengthening its balance sheet and to be judicious in its share repurchases. The Company's rating is expected to remain at the current level in the medium term. Despite the improvement, the Company's leverage is still aggressive for a cyclical company and Cascades is vulnerable to the state of the economy. An unexpected sharp decline in the economy would place the Company at risk again and could lead to negative rating actions. DBRS has simulated a default scenario for Cascades in order to analyze the potential recovery for the Company's Senior Unsecured Debt in the event of default. The scenario assumes a prolonged period of severe economic conditions, regardless of how hypothetical or unlikely the conditions may be, in which product demand and prices plummet, and EBITDA quickly declines and turns negative over the forecasted period. DBRS assumes that the Company would be reorganized as a going concern in the event of default, and has derived a recovery rating of RR4 for the Senior Unsecured Debt. The RR4 rating corresponds to recovery prospects of between 30% and 50% for senior unsecured debt holders. CASTAIC PARTNERS: Enters Chapter 11 in Los Angeles -------------------------------------------------- Castaic Partners LLC filed a Chapter 11 petition on Oct. 13 in Los Angeles, California (Bankr. C.D. Calif. Case No. 10-53956). Castaic owns 847 acres of unimproved land on Tapia Canyon Road in Castaic, California. Court papers claim the land is worth $29.5 million. Castaic Partners owes $24 million on a mortgage held by Compass USA SPE LLC. The property owner is also delinquent on almost $2 million in property taxes owing to Los Angeles County. CATHOLIC CHURCH: Urges Court to Move Quickly on Diocese Appeal -------------------------------------------------------------- The Catholic entities intent on reversing a bankruptcy judge's decision to keep $75 million in investment funds out of their grasp say their appeal in the Roman Catholic Diocese of Wilmington case must move forward quickly, DBR Small Cap reports. According to the report, the 12 groups, which include Diocese of Wilmington Schools Inc., St. Ann's Roman Catholic Church and Catholic Youth Organization Inc., say they're suffering "ongoing harm" as their bid to have a Wilmington, Del., bankruptcy judge's earlier decision undone awaits a ruling by the Third Circuit Court of Appeals. "That harm results from the appellants' inability to readily access their funds - funds that, in certain instances, comprise all of an appellants' liquid assets," the groups said in papers filed with the appeals court, the report relates. About the Diocese of Wilmington The Diocese of Wilmington covers Delaware and the Eastern Shore of Maryland and serves about 230,000 Catholics. The Delaware diocese is the seventh Roman Catholic diocese to file for Chapter 11 protection to deal with lawsuits for sexual abuse. Previous filings were by the dioceses in Spokane, Washington; Portland, Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and San Diego, California. The bankruptcy filing automatically stayed eight consecutive abuse trials scheduled in Delaware scheduled to begin October 19. There are 131 cases filed against the Diocese, with 30 scheduled for trial. The Diocese filed for Chapter 11 on Oct. 18, 2009 (Bankr. D. Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Diocese. The Ramaekers Group, LLC is the financial advisor. The petition says assets range $50,000,001 to $100,000,000 while debts are between $100,000,001 to $500,000,000. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CEDAR FAIR: Moody's Retains 'Ba3' Rating with Stable Outlook ------------------------------------------------------------ Moody's Investors Service said Cedar Fair, L.P.'s Ba3 Corporate Family Rating and stable rating outlook are not affected by Q Funding's filing of a proxy statement to adopt changes to the Partnership Agreement to separate the roles of Chairman and CEO and to prioritize distributions to unitholders, although any changes to the company's financial policies or ability to achieve the credit metrics Moody's anticipate in the ratings could negatively affect the ratings or outlook. The last rating action was on May 20, 2010 when Moody's changed Cedar Fair's rating outlook to stable from negative, upgraded the speculative-grade liquidity rating to SGL-2 from SGL-3, and assigned a Ba2 senior secured credit facility rating, and B2 senior unsecured note rating in conjunction with a proposed refinancing of the capital structure. Moody's commented on July 15, 2010, that Cedar Fair's revised financing structure did not affect the company's ratings. Cedar Fair's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, like i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Cedar Fair's core industry and Cedar Fair's ratings are believed to be comparable to those of other issuers of similar credit risk. Cedar Fair, headquartered in Sandusky, Ohio, is a publicly traded Delaware master limited partnership formed in 1987 that owns and operates 11 amusement parks, seven water parks (six outdoor and one indoor) and hotels in North America. Properties are located in the U.S. and Canada and include Cedar Point (OH), King's Island (OH), Knott's Berry Farm (CA), and Canada's Wonderland (Toronto). In June 2006, Cedar Fair, L.P., completed the acquisition of Paramount Parks, Inc., from a subsidiary of CBS Corporation for a purchase price of $1.24 billion. Cedar Fair's revenue for the LTM ended June 27, 2010, was approximately $925 million. CENTURION PROPERTIES: Can Use Cash Collateral Until Dec. 31 ----------------------------------------------------------- Centurion Properties III, LLC, sought and obtained authorization from the Hon. Frank L. Kurtz of the U.S. Bankruptcy Court for the Eastern District of Washington to use prepetition lender General Electric Capital Corporation's cash collateral until December 31, 2010. The Debtor will use the money pursuant to this budget: http://bankrupt.com/misc/CENTURION_PROPERTIES_budget.pdf The Debtor will prepare its budget for the three month period commencing January 1, 2011. The budget will be submitted to GECC for approval by December 17, 2010, and a hearing for the approval will take place by December 31, 2010. The Debtor will establish a money market account at Washington Trust Bank. All funds currently on deposit in the Lockbox will be transferred to the money market account. Future revenues from the Battelle Property -- consists of five buildings, related improvements and common areas on the leasehold estates in Richland, Washington, at the Battelle Memorial Institute Campus -- will also be deposited into the money market account. The Debtor will instruct tenants of the Battelle Property that any and all payments related to the Battelle Property should be directed to the money market account. The money market account will be controlled by the Debtor and not require GECC's signature or written approvals for withdrawals. To the extent the Debtor has any right to funds in the money market account, GECC is granted a first priority perfected security interest in and lien upon the money market account, all Debtor's rights in the funds therein, and any interest earned thereon. GECC is entitled to the monthly payment of interest based on the outstanding principal amount of the loan on the first day of each month. To provide adequate protection of GECC's interest in the property securing its prepetition secured claims against the Debtor resulting from the use of cash collateral, the Debtor will pay by GECC $330,000 by the first day of each month. As further protection to GECC for any decrease in the value of its interest in any property securing its prepetition secured claims against the Debtor resulting from the use of cash collateral, GECC is granted a first priority perfected security interest in and lien upon all property constituting mortgaged property, whether now owned and existing or hereafter acquired. GECC is also entitled to any and all rights afforded by Section 507(b) of the U.S. Bankruptcy Code. If the protections afforded are inadequate, GECC may be entitled to a superpriority administrative claim. The Debtor will provided financial reports for each calendar month to GECC by the 15th day of any following month, commencing on September 15, 2010, and other information relating to the Battelle Property and its leasing as GECC may request from time to time. GECC will have the right to credit bid the allowed amount of its secured claim in any sale, lease or other disposition of assets that secure the Debtor's obligations under the loan documents. About Centurion Properties Kennewick, Washington-based Centurion Properties III, LLC, filed for Chapter 11 bankruptcy protection on July 9, 2010 (Bankr. E.D. Wash. Case No. 10-04024). John D. Munding, Esq., at Crumb & Munding, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50,000,001 to $100,000,000. CENTURION PROPERTIES: Files Schedules of Assets & Liabilities ------------------------------------------------------------- Centurion Properties III, LLC, has filed with the U.S. Bankruptcy Court for the Eastern District of Washington its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $98,000,000 B. Personal Property $907,255 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $93,258,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $22,076,775 ----------- ----------- TOTAL $98,907,255 $115,334,775 Kennewick, Washington-based Centurion Properties III, LLC, filed for Chapter 11 bankruptcy protection on July 9, 2010 (Bankr. E.D. Wash. Case No. 10-04024). John D. Munding, Esq., at Crumb & Munding, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50,000,001 to $100,000,000. CENTURION PROPERTIES: US Trustee Unable to Form Creditors' Panel ---------------------------------------------------------------- Robert D. Miller Jr., the U.S. Trustee for Region 18, said he is unable to appoint members to the Official Committee of Unsecured Creditors in Centurion Properties, Inc.'s Chapter 11 cases. Due to lack of response to the Trustee's request for notice of willingness to serve on the unsecured creditors' committee, the U.S. Trustee is not appointing an unsecured creditors' committee in this case at the present time. Kennewick, Washington-based Centurion Properties III, LLC, filed for Chapter 11 bankruptcy protection on July 9, 2010 (Bankr. E.D. Wash. Case No. 10-04024). John D. Munding, Esq., at Crumb & Munding, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50,000,001 to $100,000,000. CHEMTURA CORP: Court Establishes Reserve for Environmental Claims ----------------------------------------------------------------- Judge Robert Gerber of the U.S. Bankruptcy Court for the Southern District of New York authorized Chemtura Corporation and its debtor affiliates to establish a distribution reserve amount with respect to Class 11 Environmental Claims in connection with confirmation of the Debtors' Chapter 11 Plan of Reorganization. The amount of the Environmental Reserve will be $37,645,938. To the extent amounts are placed in a segregated reserve within the Environmental Reserve as a result of settlement agreements that are pending approval of the Court, the rights of all parties to the settlement agreements are subject to the settlement agreements. In addition to segregated reserves that are established as a result of pending settlement motions, the Debtors are authorized to establish a segregated reserve within the Environmental Reserve amounting to $6,325,217 on account of, and for the benefit of the holders of: -- Claim No. 10718 filed by the New Jersey Department of Environmental Protection with respect to a site located in Brainards, New Jersey; and -- Claim No. 1578 filed by the Township of Harmony. The rights of NJDEP and the Township with respect to their Claims will be preserved pending the consensual resolution or litigation of the asserted Claims, provided that the amount that may be recovered from the Debtors on account of the Claims will be limited to the amount set in the Segregated Environmental Reserve. In addition to segregated reserves that are established as a result of pending settlement motions that have been filed with the Court, the Debtors are authorized to establish another segregated reserve within the Environmental Reserve totaling $4,129,722 for the benefit of the California Department of Toxic Substances Control with respect to its claims. The rights of DTSC will be preserved pending the consensual resolution or litigation of its claims. The amount that may be recovered from the Debtors by DTSC on account of DTSC's Claims will be limited to the amount set in the segregated Environmental Reserve. The Court's Order establishing the Environmental Reserve is without prejudice to (a) the contentions of certain governmental units and parties that the Debtors' remediation and environmental obligations are not claims under Section 101(5) of the Bankruptcy Code that are dischargeable pursuant to Section 1141 of the Bankruptcy Code, and (b) the contentions of any other party-in- interest that the Debtors' remediation and environmental obligations are claims under Section 101(5) that are dischargeable pursuant to Section 1141. Stetlers Object to Establishment of Disputed Claims Reserve In addition to establishing establish a distribution reserve with respect to Class 11 Environmental Claims, the Debtors also asked the Court to establish a distribution reserve amount with respect to disputed claims in connection with confirmation of the Plan. Amy and Kurt Stetler tell the Court that their only objection to the Debtors' request is that it values the Stetlers claim at zero based upon insurance coverage, "without proof that such coverage exists." However, the Stetlers note that they will withdraw their objection in the event: -- insurance coverage is proved; -- an acceptable mechanism is established for creation of a reserve if coverage does not ultimately exist; or -- a reserve established based upon a reasonable estimate of Stetlers' claim assuming no insurance coverage. Against this backdrop, the Stetlers ask Judge Gerber to deny establishment of a disputed claims distribution reserve until their demands are met. 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. CHEMTURA CORP: Court Sets Diacetyl Reserve for $6.9 Million ----------------------------------------------------------- Judge Robert Gerber of the U.S. Bankruptcy Court for the Southern District of New York has established a reserve for diacetyl- related liabilities of Chemtura Corporation and its debtor affiliates in the aggregate amount of $6,923,975. The $6.9 million Main Reserve will be segregated into separate reserves. A schedule on the specific segregated amounts, however, is filed under seal as the liquidated claims of Ungerer & Company are confidential in nature. Should the Debtors consensually resolve the liquidation corporate Diacetyl Claim held by Ungerer before the effective date of their proposed Chapter 11 Plan, the Debtors may reduce the amount of Ungerer's segregated portion of the Diacetyl Reserve to the settled value, net of demonstrably available insurance proceeds, pending Court approval of the settlement. Upon approval by the Court of the Debtors' settlement and release agreements with any counsel for Diacetyl Claimants or Diacetyl Claimants themselves before the Effective Date, the Debtors may reduce the amount of the applicable segregated portion of the Diacetyl Reserve to zero and those claims will be paid in accordance with the particular settlement and release agreements and the Plan. Nothing in the Court's order will constitute or be construed as constituting the allowance of any Diacetyl Claim. The Court entered its ruling in light of the Debtors' previous motion for the estimation of the value of Diacetyl Claims and the Debtors' having filed a Joint Plan of Reorganization dated August 4, 2010, which provides for the establishment of the Diacetyl Reserve. Judge Gerber also acknowledged that the Debtors have consensually resolved all remaining Diacetyl Claims requiring estimation under the Court's Amended Case Management Order dated September 1, 2010. The Amended CMO acknowledges that the Debtors have resolved 90% of the asserted Diacetyl Claims by entering into a settlement with Humphrey Farrington & McClain P.C., which acted on behalf of the its clients. The Amended CMO thus provides that Diacetyl Claimants whose Diacetyl Claims have not been resolved by settlement and must be estimated were required to serve declarations in support of their Claims; parties-in-interest were given the opportunity to respond to the declarations; and the Court will have held an oral agreement on the valuation briefing. 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. CHEMTURA CORP: Wins Approval of Andrews/Guild Diacetyl Pacts ------------------------------------------------------------ Chemtura Corp. and its units and obtained permission from Judge Robert Gerber to enter into three settlement and release agreements with: (1) Andrews & Thornton, Brown Rudnick, Dimarco Araujo & Montevideo, Kresch Legal Services, Goldenberg Heller Antognoli & Rowland, and The Lyon Firm, on behalf of their diacetyl-related clients; (2) the Metzger Law Group on behalf of their diacetyl-related clients; and (3) Jennifer Guild, on her own behalf. The Agreements resolve four pending lawsuits initiated by the Andrews Counsel and three pending lawsuits initiated by the Metzger Counsel on behalf of their clients, alleging injuries related to exposure to the chemical diacetyl, as well as 10 diacetyl-related proofs of claim filed by the Diacetyl Claimants in response to the Debtors' comprehensive noticing of the October 30, 2009 Bar Date. The Diacetyl Claimants represented by the Andrews Counsel and their corresponding claims or lawsuits are: Claimant Claim No./Lawsuit -------- ----------------- Carolyn Kiefer 11177 Charles Norrington 10617 Erik Marin 14146 Francisco Herrera 10332 Karen Birdson 13966 Samuel Berry 10530 John & Steven Landolfi 11877 for the deceased Roy Hood Hood v. Givaudan Flavors Corp., et al. Case No. A1005239 The Diacetyl Claimants represented by the Metzger Counsel and their corresponding claims or lawsuits are: Claimant Claim No./Lawsuit -------- ----------------- Ricardo Corona 6059 Irma Mancilla 6232 Victor Mancilla 6262 Ismael Rosas Rosas, et al., v. Flavorchem Corp., et al., No. BC400974, Los Angeles County Superior Court, California Wilfredo Velasquez Velasquez v. FEMA, et al., No. BC370319, Los Angeles County Superior Court, California Gustavo Gomez Rosas, et al., v. Flavorchem Corp., et al., No. BC400974, Los Angeles County Superior Court, California Regulo Arredondo Rosas, et al., v. Flavorchem Corp., et al., No. BC400974, Los Angeles County Superior Court, California Jennifer Guild's claim is designated as Claim No. 8297. The Agreements allow for the payment of certain settlement amounts, assuming each of the Diacetyl Claimants satisfies certain settlement criteria, to resolve liabilities that could be several times greater. The settlement amounts are predicated on the same economic claims matrix that has already been reviewed and approved by the Court in connection with the $50 million settlement among Chemtura Corp., Chemtura Canada and Humphrey Farrington & McClain P.C. on behalf of its clients. The Settlements further provide that each of the Diacetyl Claimants agree not to oppose confirmation of the Debtors' Chapter 11 Plan. The Settlements eliminate a risk of substantial liability, free the Debtors from the costs and expenses of protracted litigation, and allow the Debtors to focus on emerging from Chapter 11, M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, maintains. Full-text copies of the Diacetyl Claims Settlement are available for free at: http://bankrupt.com/misc/ChemAndrewsSttlmt.pdf http://bankrupt.com/misc/ChemGuildSttlmt.pdf http://bankrupt.com/misc/ChemMetzgerSttlmt.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. CHEMTURA CORP: Wins Nod for Burcham Diacetyl Settlement ------------------------------------------------------- Chemtura Corporation and Chemtura Canada Co./CIE sought and obtained permission from Judge Robert Gerber to enter into a diacetyl claims settlement with Tom R. Burcham, III, Esq., Robert Devoto, Esq., Gary Matheny, Esq., and Spencer P. Desai, Esq., on behalf of clients the counsel represent, with respect to certain diacetyl-related liabilities. The Burcham Agreement resolves two pending lawsuits brought by plaintiffs represented by the Burcham Counsel against the Debtors alleging injuries related to exposure to the chemical diacetyl, as well as seven diacetyl-related proofs of claim filed by the Burcham Diacetyl Claimants in response to the Debtors' comprehensive noticing of the October 30, 2009 Bar Date. The Diacetyl Claimants represented by the Burcham Counsel and their corresponding claims or asserted lawsuits are: Claimant Claim No./Lawsuit -------- ----------------- Carolyn Kiefer 11177 Georgia Hawthorne 10834 Karen Geile 11175 Marjorie Turnbough 11176 Mary Whiteside 11174 Rachane Thitakom 10717 Sara Lane 10707 Pamela Wibbenmeyer Wibbenmeyer, et al. v. Citrus & Allied Essences, Ltd., et al., No. 07PR-CCC00047-01, Circuit Court of Cape Girardeau County, Missouri Lauren Elder Wibbenmeyer, et al. v. Citrus & Allied Essences, Ltd., et al., No. 07PR-CCC00047-01, Circuit Court of Cape Girardeau County, Missouri The Burcham Agreement calls for a total payment of up to $2,205,728, assuming each of the Diacetyl Claimants satisfies certain settlement criteria, to resolve liabilities that could be several times greater. Expert reviews and records indicate that the Burcham Diacetyl Claims could be worth more than $6.5 million, according to the Debtors. Thus, the Debtors maintain, the Burcham Settlement relieves Chemtura Corp. and Chemtura Canada's liability for the Burcham Claims and Lawsuits at a fraction of their potential value. Before any portion of the settlement amount is paid to a Diacetyl Claimant, the Diacetyl Claimant must provide these information to Chemtura Corp. and Chemtura Canada: (i) an affidavit signed by the Diacetyl Claimant indicating the place or places at which and time period during which, the Diacetyl Claimant alleges exposure to Diacetyl or any product, including butter flavoring, that contains Diacetyl manufactured, distributed, or sold by Chemtura Corp. or Chemtura Canada, and the employment position, if applicable, held by the Diacetyl Claimant for each time period; (ii) evidence that Diacetyl manufactured, distributed, or sold by Chemtura Corp. or Chemtura Canada was used or present at one or more of the places during the time period identified by a Diacetyl Claimant in the affidavit prepared; and (iii) a medical affidavit from a licensed physician including, at a minimum, the following conclusions: (a) the FEV1 score for the Diacetyl Claimant; (b) the lung capacity of the Diacetyl Claimant is impaired; and (c) the Diacetyl Claimant's exposure to Diacetyl caused or contributed to the Diacetyl Claimant's lung capacity impairment. Counsel to the Debtors, M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, relates that the settlement amount is predicated on the same economic claims matrix that has already been reviewed and approved by the Court in connection with the $50 million settlement among Chemtura Corp., Chemtura Canada and Humphrey Farrington & McClain P.C. on behalf of its clients. The payment of the Settlement Amount fully satisfies and resolves the Diacetyl Claims held by the Burcham Diacetyl Claimants. The Burcham Counsel will obtain a separate release and indemnity agreement from each Diacetyl Claimant and submit that agreement to Chemtura and Chartis Insurers to be held in escrow pending resolution of the Settlement Criteria. With Judge Gerber's approval of the Burcham Settlement, Chemtura Corp. is to use commercially reasonable efforts to obtain a stay by the Court of the portion of the estimation hearing proceedings that pertains to the Diacetyl Claims. Within two business days after the Settlement Amount is paid, the Burcham Counsel will file in the pending Burcham Diacetyl Lawsuits the required notices, stipulations, or motions to dismiss with prejudice any Diacetyl Claims against Chemtura and Chemtura Canada. Moreover, with the Court's approval of the Burcham Settlement obtained, the Burcham Diacetyl Claims are deemed to be temporarily allowed solely for purposes of voting to accept or reject the Plan in the amounts set forth in the Liquidation Matrix. In addition, each of the Burcham Diacetyl Claimants agrees not to oppose confirmation of the Debtors' Chapter 11 Plan. The Official Committee of Unsecured Creditors and the Ad Hoc Committee of Bondholders both support the Debtors' entry into the Burcham Settlement. A full-text copy of the Burcham Diacetyl Claims Settlement is available for free at: http://bankrupt.com/misc/ChemBurchamSttlmt.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. CITY INTERNATIONAL: Chapter 15 Case Summary ------------------------------------------- Chapter 15 Petitioner: Toby Wooldridge Chapter 15 Debtor: City International Insurance Company Limited 40 Dukes Place EC3A 7NH London Chapter 15 Case No.: 10-15360 Chapter 15 Petition Date: October 14, 2010 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Chapter 15 Petitioner's Counsel: Kenneth P. Coleman, Esq. ALLEN & OVERY LLP 1221 Avenue of Americas New York, NY 10022 Tel: (212) 610-6300 Fax: (212) 610-6399 Estimated Assets: $1,000,001 to $10,000,000 Estimated Assets: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. CLOVERLEAF ENTERPRISES: Judge Opts to Assign Chapter 11 Trustee --------------------------------------------------------------- The Baltimore Sun's Hanah Cho, citing a court ruling issued on October 13, reports that a trustee will be assigned to the bankruptcy proceedings of Rosecroft Raceway. The Baltimore Sun relates Bankruptcy Judge Paul Mannes wrote in his decision that "although grounds exist for converting the case . . . this Court determines in its discretion that appointment of a Chapter 11 Trustee is the better course." According to The Baltimore Sun, the U.S. trustee requested that Company be converted from a reorganization to a liquidation, or in the alternative, have the Debtor's estate taken over by a Chapter 11 trustee. Cloverleaf Enterprises Inc. -- http://www.rosecroft.com/-- owns the Rosecroft Raceway, a harness track in Fort Washington, Maryland. The Company filed for Chapter 11 protection (Bankr. D. Md. Case No. 09-20056) on June 3, 2009, represented by Nelson C. Cohen, Esq., at Zuckerman Spaeder LLP in Washington, D.C. The Company estimated $10 million to $50 million in assets and $1 million to $10 million in debts in its Chapter 11 petition. The Company's operations were halted in June 2010. CRYSTAL CATHEDRAL: Files for Chapter 11 in California ----------------------------------------------------- Crystal Cathedral Ministries filed for Chapter 11 protection on October 18 in Santa Ana, California (Bankr. C.D. Calif. Case No. 10-24771). The Debtor estimated assets and debts of $50 million to $100 million in its Chapter 11 petition. Crystal Cathedral Ministries is the Southern California megachurch founded by television evangelist Robert Schuller. The church, based in Garden Grove, claims a congregation of 10,000 members. According to The Orange County Register, Senior Pastor Sheila Schuller Coleman said in a statement Monday that the bankruptcy filing was a necessity because a small number of creditors chose to file lawsuits and obtained court-ordered writs to attach the church's bank accounts and assets in an attempt to get paid right away. "For these reasons, the Ministry now finds it necessary to seek the protection of a Chapter 11," she said later at a press conference. "Budgets could not be cut fast enough to keep up with the unprecedented rapid decline in revenue due to the recession," Pastor Schuller Coleman also said in the statement. U.S. churches are struggling financially because high unemployment has cut weekly offerings, said Wayne Bradshaw, president and chief operating officer of Broadway Federal Bank, according to Bloomberg News. The Los Angeles-based lender does about 25% of its lending business with churches. Broadway Federal, which has about $510 million in assets, has made about $100 million in loans to churches, Mr. Bradshaw said. The church-related loans have a higher rate of late payments than Broadway's other loans, Mr. Bradshaw added. The Debtor's board of directors on Aug. 27 authorized a bankruptcy filing by Chief Financial Officer Fred W. Southard. Marc J. Winthrop, Esq., at Winthrop Couchot Professional Corporation, in Newport Beach, CA, serves as counsel to the Debtor. CRYSTAL CATHEDRAL: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Crystal Cathedral Ministries 13280 Chapman Ave. Garden Grove, CA 92840-4414 Bankruptcy Case No.: 10-24771 Type of Business: Crystal Cathedral Ministries is a Southern Californi-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Chapter 11 Petition Date: October 18, 2010 Bankruptcy Court: U.S. Bankruptcy Court Central District of California (Santa Ana) Bankruptcy Judge: Robert N. Kwan Debtor's Counsel: March J. Winthrop, Esq. 660 Newport Center Dr Ste 400 Newport Beach, CA 92660 Tel. (949) 720-4100 Email: mwinthrop@winthropcouchot.com Estimated Assets: $50 million to $100 million Estimated Debts : $50 million to $100 million The petition was signed by Fred W. Southard, chief financial officer. Crystal Cathedral's List of 20 Largest Unsecured Creditors: Entity/Person Nature of Claim Claim Amount ------------- --------------- ------------ Promotional Media Inc. Trade $397,855 Attn: Corporate Officer 727 N. Main S1. Orange, CA 92868 Infocision Management Corp. Trade $359,788 Attn: Corporate Offcer 325 Springside Dr. Akron, OR 44333 Media Services Agency Trade $352,370 Attn: Lucille Hollison P.O. Box 11901 Santa Ana, CA 92711 Lloyd Daniel Corporation Trade $318,500 FGS-CA, Inc. Trade $252,992 KWGN-TV Trade $206,945 World Marketing Inc. Trade $200,386 Thomas Nelson Publisher Trade $200,219 Daystar Television Network Trade $172,997 Wheelchair Foundation Trade $163,551 Lutzker & Lutzker, LLP Trade $147,225 KMSP Trade $115,175 Classis of California- Trade $111,675 Canyon Lake Gipson Hoffman & Pancione Trade $110,622 WKCF-TV Trade $105,400 Scripps Howard Broad Trade $87,125 A-I Building Maintenance, Inc. Trade $86,456 KMYQ Trade $80,155 WKRC-TV Trade $74,970 Advantage Mailing Inc. Trade $71,305 CUSTOM CABLE: Counsel for Parent's Shareholders Asks to Withdraw ---------------------------------------------------------------- Latham Shuker Eden & Beaudine LLP is seeking bankruptcy-court approval to withdraw as counsel for shareholders of Custom Cable Industries Inc.'s parent, DBR Small Cap reports. According to the report, the firm said in court papers Friday that it currently represents two groups of shareholders in Custom Cable's parent HWI Technologies LLC, which last month lost their bid to have Custom Cable's bankruptcy case dismissed. The report relates that partners at the law firm first appeared in Custom Cable's bankruptcy case when two groups of HWI shareholders - holders of Class A preferred shares and a group of shareholders called "non-ComVest shareholders" sought the dismissal of the company's bankruptcy case. ComVest Capital LLC is Custom Cable's senior lender and majority shareholder. But, the report notes, on Oct. 11, the firm said "certain events occurred which gave rise to Latham Shuker's need to withdraw from further representation." The partners are R. Scott Shuker and Hewett G. Woodward. Founded in 1980, Custom Cable Industries, Inc. -- http://www.customcable.com/-- manufactures and installs audio, video and fiber-optic cables. Custom Cable filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 10-18478) on July 30, 2010. Michael P. Horan, Esq., and Stephanie C. Lieb, Esq., at Trenam Kemker Scharf Barkin Frye, serve as the Debtor's bankruptcy counsel. The Debtor estimated $1 million to $10 million in assets and $10 million to $50 million in debts in the Chapter 11 petition. DAVID DRUMM: Files for Chapter 7 in Boston ------------------------------------------ David K. Drumm, former chief executive officer of Anglo Irish Bank Corp., filed a Chapter 7 bankruptcy petition on October 14 in Boston (Bankr. D. Mass. Case No. 10-21198). The Debtor estimated assets and debt between $1 million and $10 million. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, the filing came after the bank turned down Mr. Drumm's offer to settle a lawsuit in Irish courts over an EUR8.5 million ($12 million) loan. Mr. Drumm has resided in Massachusetts for the past six months and lives in Wellesley. Mr. Rochelle relates that the Chapter 7 filing in the U.S. may have been calculated to prevent the filing of an involuntary bankruptcy against him in Ireland or to stop the lawsuit there. The filing of the petition may force his Irish creditors to come to the U.S. to test whether he is eligible for bankruptcy in the U.S. Mr. Drumm resigned from Dublin-based Anglo Irish in December 2008, a month before the bank was seized by the Irish government. DAYBREAK OIL: Incurs $370,100 Net Loss in August 31 Quarter ----------------------------------------------------------- Daybreak Oil and Gas, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $370,111 on $307,006 of revenue for the three months ended August 31, 2010, compared with a net loss of $471,021 on $130,147 of revenue for the same period ended August 31, 2009. The Company has incurred net losses since inception and as of August 31, 2010, has an accumulated deficit of $21.9 million. The Company's balance sheet at August 31, 2010, showed $2.5 million in total assets, $2.1 million in total liabilities, and stockholders' equity of $420,410. MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended February 28, 2010. The independent auditors noted that the Company suffered losses from operations and has negative operating cash flows. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6c9a About Daybreak Oil Spokane, Wash.-based Daybreak Oil and Gas, Inc. (OTC BB: DBRM) -- http://www.daybreakoilandgas.com/-- is an independent oil and natural gas exploration, development and production company. The Company is in the process of developing a multi-well oilfield project in Kern County, California and has participated in the drilling of nine oil wells that have achieved commercial production. This project is comprised of three project areas: East Slopes, East Slopes North and the Expanded AMI project. DOWA INSURANCE: Chapter 15 Case Summary --------------------------------------- Chapter 15 Petitioner: Toby Wooldridge Chapter 15 Debtor: Dowa Insurance Company (Europe) Limited 9-13 Frenchurch Buildings EC3M 5HR London Chapter 15 Case No.: 10-15361 Chapter 15 Petition Date: October 14, 2010 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Chapter 15 Petitioner's Counsel: Kenneth P. Coleman, Esq. ALLEN & OVERY LLP 1221 Avenue of Americas New York, NY 10022 Tel: (212) 610-6300 Fax: (212) 610-6399 Estimated Assets: $1,000,001 to $10,000,000 Estimated Assets: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. DRYSHIPS INC: Unit Signs Drilling Deal With Vanco Overseas ---------------------------------------------------------- DryShips Inc. said that its fully-owned subsidiary Ocean Rig UDW Inc. has signed drilling contracts with subsidiaries of Vanco Overseas Energy Limited. Under the contracts, Vanco is operator and LUKOIL Overseas is majority co-venturer for a five-well contract for exploration drilling offshore Ghana and Cote d'Ivoire for a period of about one year with one drillship, commencing in the second quarter of 2011. The value of the contracts is approximately $160 million. The Company has the option to use either of the OceanRig Corcovado or the OceanRig Olympia. The contract may be extended for an additional year or an additional well, prior to the completion of operations on the second well in the program. George Economou, Chairman, President & CEO commented, "We are pleased to have concluded the contract for one of the first two drillships that will deliver from Samsung in the first quarter of 2011. The option of using the first or the second drillship allows us to service the requirements of the customer and gives us flexibility considering the other tenders we are working on. This contract opens a new relationship for OceanRig with International operators who have strong potential in the ultra deepwater space and have drilling programs well beyond this first commitment. Moreover, this contract builds on the platform we have nurtured in Ghana. Ghana is emerging as a new oil province in West Africa with potential that could match Angola in the years to come. Our highly capable and unique semi-submersible drilling rig, the Eirik Raude, has been drilling offshore Ghana on contract to Tullow Oil for almost two years now. The experience gained over this period and the economies of scale with two rigs in adjacent areas will benefit OceanRig and position us for further business in this region. We are proud to be part of the growth story of Ghana." Mr. Economou added, "The fundamentals of the ultra deepwater market have strengthened substantially in the last couple of months. While this hasn't manifested itself in the form of rising rates yet, we are experiencing a surge in activity. OceanRig is amongst the first to announce the conclusion of a contract in recent months, but we are aware of at least four additional ultra deepwater units that have been, or are close to being, contracted. Assuming this is the case the supply picture starts to look much better than what analysts were projecting just a few weeks ago. Moreover, demand is rising as we see new projects being tendered, with inquiries emerging on a weekly basis. We remain confident that the remaining three drillships will also find employment contracts in the near future." About DryShips Inc. Based in Greece, DryShips Inc. -- http://www.dryships.com/-- -- owns and operates drybulk carriers and offshore oil deep water drilling units that operate worldwide. As of September 10, 2010, DryShips owns a fleet of 40 drybulk carriers (including newbuildings), comprising 7 Capesize, 31 Panamax and 2 Supramax, with a combined deadweight tonnage of over 3.6 million tons and 6 offshore oil deep water drilling units, comprising of 2 ultra deep water semisubmersible drilling rigs and 4 ultra deep water newbuilding drillships. DryShips's common stock is listed on the NASDAQ Global Select Market where it trades under the symbol "DRYS". The Company's balance sheet as of June 30, 2010, showed $5.983 billion in total assets, $3.101 billion in total liabilities, and stockholders equity of $2.882 billion. As reported in the Troubled Company Reporter on Sept. 29, 2010, the Company said it is currently in negotiations with its lenders to obtain waivers, waiver extensions or to restructure its debt. As of June 30, 2010, the Company's theoretical exposure (current portion of long-term debt less cash and cash equivalents less restricted cash) amounted to $761.4 million. DUNE ENERGY: Pays $500,000 to Amend Wells Fargo Credit Pact ----------------------------------------------------------- Dune Energy Inc. entered into a sixth amendment to Credit Agreement dated May 15, 2007, with Wells Fargo Capital Finance Inc., formerly known as Wells Fargo Foothill Inc., as arranger and administrative agent, and the lenders named therein. Modifications to the Credit Agreement include: * adjusting the Borrowing Base formula to provide for an increase, from $20 million to $30 million, in the additional allowance to be deducted from the Company's PDP calculation when determining the Borrowing Base; * modifying the definition of "Permitted Dispositions" to no longer include the sale, lease, license, assignment, farm-out, conveyance or other transfer of any, or any interest in, Oil and Gas Properties constituting Proved Reserves in the normal course of business without prior consent, as required under the Credit Agreement; * eliminating the requirement to maintain Acceptable Commodity Hedging Agreements for the Company's Hydrocarbon production for periods subsequent to March 31, 2011; and * adjusting existing restrictive covenants to lower certain minimum production requirements of net hydrocarbons by the Company, measured for any calendar month. Upon the Company's failure to comply with covenants, the Company's senior creditors have the right to refuse to advance additional funds under the Credit Agreement and declare any outstanding principal and interest immediately due and payable. As of October 12, 2010, the Company had no outstanding borrowings under the revolving loan and $8.5 million of standby letters of credit outstanding. An amendment fee of $500,000 was paid for these changes. A full-text copy of the Sixth Amended Credit Agreement is available for free at http://ResearchArchives.com/t/s?6c9c About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company's balance sheet at June 30, 2010 showed $299.88 million in total assets, $337.90 million in total liabilities, redeemable preferred stock of $195.16 million, and a stockholders' deficit of $233.18 million. * * * Dune Energy carries a 'CCC-' corporate credit rating, with negative outlook, from Standard & Poor's. S&P said in April 2010 that "the company's heavy debt burden makes the prospects of a distressed exchange or bankruptcy a distinct possibility." Dune Energy has a 'Ca' corporate family rating from Moody's. E.DIGITAL CORPORATION: Posts $350,200 Net Loss in June 30 Quarter ----------------------------------------------------------------- e.Digital Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $350,192 on $512,398 of revenue for the three months ended June 30, 2010, compared to a net loss of $569,076 on $223,030 of revenue for the same period ended June 30, 2009. The Company has an accumulated deficit of $80.3 million as of June 30, 2010. The Company's balance sheet at June 30, 2010, showed $3.0 million in total assets, $311,891 in total liabilities, and stockholders' equity of $2.7 million. As reported in the Troubled Company Reporter on June 15, 2010, SingerLewak LLP, in Los Angeles, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended March 31, 2010. The independent auditors noted that the Company has historically suffered recurring losses from operations and has a substantial accumulated deficit. A full-text copy of the Form 10-Q is is available for free at: http://researcharchives.com/t/s?6ca5 About e.Digital Corporation San Diego, Calif.-based e.Digital Corporation is a holding company incorporated under the laws of Delaware that operates through a wholly-owned California subsidiary of the same name. The Company markets its eVU(R) mobile entertainment system for the travel and recreational industries and licenses and enforces its Flash-R(TM) portfolio of flash memory patents for use in portable devices produced by electronic product manufacturers. EDUCATION RESOURCES: Settlement Allows Plan Confirmation -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that The Education Resources Institute Inc. is in a position to confirm a Chapter 11 plan at a hearing following a settlement compromising the $87 million claim of First Marblehead Corp. In return for dropping claims on both sides, First Marblehead will have an approved unsecured claim for $28.1 million. The claim resulted mostly from the rejection of the agreements between the two companies. First Marblehead provided back office and other services in connection with originating and securitizing loans. The Plan confirmation hearing was scheduled for October 18. Mr. Rochelle relates that the disclosure statement explaining the Chapter 11 plan says that secured lenders, with as much as $400 million in claims, will be paid in full over time. Unsecured creditors, including deficiency claims of secured lenders, should see up to 60% on claims that may reach $375 million. The Plan was developed by TERI and the creditors' committee. About The Education Resources Headquartered in Boston, Massachusetts, The Education Resources Institute Inc. -- http://www.teri.org/-- aka Boston Systems Resources Inc., Brockton Education Opportunity Center, TERI, TERI College Access, TERI College Access Centers and TERI Marketing Services Inc., is a nonprofit organization that promotes educational opportunities for all through its college access and loan guarantee activities. Founded in 1985, TERI is a guarantor of private or non-government student loans with more than $17 billion in outstanding guarantees. The Debtor filed for Chapter 11 petition on April 7, 2008 (Bankr. D. Mass. Case No. 08-12540). Daniel Glosband, Esq., Gina L. Martin, Esq., at Goodwin Procter LLP, represent the Debtor in its restructuring efforts. The Debtor's Conflicts Counsel is Craig and Macauley PC, its financial advisor is Grant Thornton LLP, its Claims Agent is Epiq Bankruptcy Solutions LLC, its investment Banker is Citigroup Global Markets Inc., and its Public Relations & Public Affairs Advisor is Rasky Baerlein Strategic Communications Inc. When the Debtor filed for protection from its creditors, it estimated assets of more than $1 billion and under $1 billion in debts. EMMIS COMMS: Posts $70,000 Net Income in August 31 Quarter ---------------------------------------------------------- Emmis Communications Corporation filed its quarterly report on Form 10-Q with the Securities and Exchange Commission, reporting net income of $70,000 on $66.85 million of net revenues for the three months ended Aug. 31, 2010, compared with a net loss of $133.37 million on $64.21 million of net revenues for the same period a year ago. The Company's balance sheet at Aug. 31, 2010, showed $493.89 million in total assets, $484.90 million in total liabilities, $140.459 million in series A convertible preferred stock, shareholders' deficit of $178.959 million, noncontrolling interests of $49.22 million, and a total deficit of $131.47 million. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?6ca0 About Emmis Headquartered in Indianapolis, Indiana, Emmis Communications Corporation -- http://www.emmis.com/-- owns and operates radio stations and magazine publications in the U.S. and in Europe. * * * Emmis carries a 'Caa2' long term corporate family rating, with negative outlook, from Moody's. It has a 'Caa3' probability of default rating from Moody's. ENERGY FUTURE: Units Price Offering of $350MM 2nd Lien Notes ------------------------------------------------------------ Texas Competitive Electric Holdings Company LLC and TCEH Finance, Inc., both indirect wholly-owned subsidiaries of Energy Future Holdings Corp. have priced a private offering of $350 million principal amount of 15% Senior Secured Second Lien Notes due 2021, Series B. The offering is expected to close on or about October 20, 2010, subject to customary closing conditions. The Issuer intends to use the net proceeds from the offering for the payment, repayment or prepayment of term loans under TCEH's Credit Agreement, dated as of October 10, 2007, as amended, and/or the repurchase of principal amounts outstanding of the Issuer's 10.25% Senior Notes due 2015, 10.25% Senior Notes due 2015, Series B and 10.50%/11.25% Senior Toggle Notes due 2016 , which may include repurchases of TCEH 2015/2016 Notes in connection with this offering, including from certain of the initial purchasers. The Companies will use the net proceeds from the offering for the payment, repayment or prepayment of term loans under TCEH's Credit Agreement, dated as of October 10, 2007, as amended, and/or the repurchase of principal amounts outstanding of the Issuer's 10.25% Senior Notes due 2015, 10.25% Senior Notes due 2015, Series B and 10.50%/11.25% Senior Toggle Notes due 2016, which may include repurchases of TCEH 2015/2016 Notes in connection with this offering, including from certain of the initial purchasers. About Energy Future Energy Future Holdings Corp. is a privately held energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leveraged buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. * * * As reported by the Troubled Company Reporter on August 19, 2010, Fitch Ratings downgraded the Issuer Default Ratings of Energy Future Holdings Corp. and its subsidiaries Energy Future Intermediate Holding Company LLC, Texas Competitive Electric Holdings Company LLC, and Energy Future Competitive Holdings Company by one notch to 'CCC' from 'B-'. The downgrades of the IDRs of EFH and its non-ring-fenced subsidiaries reflect large debt maturities occurring in 2014, over-leveraged capital structure, cash flow dependence on the forward natural gas NYMEX curve, which has been consistently moving down since mid-2008, and the likely outcome of future debt exchanges and amend-and-extend bank facility negotiations. In Fitch's view, potential defaults in 2011-2012 are considered more likely to result from coercive debt exchanges and unlikely to result from payment defaults. The TCR on August 19, 2010, also reported that Moody's Investors Service changed the probability of default rating for Energy Future Holdings to Caa2/LD from Ca following the completion of a debt restructuring which Moody's views as a distressed exchange. EFH's Caa1 CFR and SGL-4 liquidity rating were affirmed. The rating outlook remains negative. Moody's said the affirmation of EFH's Caa1 CFR considers the very weak financial profile, untenable capital structure, questionable long-term business plan and material operating headwinds for the company. Moody's believes EFH has very little financial flexibility. ESBH INC: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: ESBH, Inc. 4410 Massachusetts Ave, NW Washington, DC 20016 Bankruptcy Case No.: 10-01000 Chapter 11 Petition Date: October 8, 2010 Court: United States Bankruptcy Court District of Columbia (Washington, D.C.) Judge: S. Martin Teel, Jr. Debtor's Counsel: Natalie S. Walker, Esq. WEBSTER, FREDRICKSON, CORREIA & PUTH 1775 K Street, NW, Suite 600 Washington, DC 20006 Tel: (202) 659-8510 E-mail: nwalker@wfcplaw.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. The petition was signed by David Castiel, CEO. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Ellipso, Inc. 09-0148 02/25/2009 EURAMAX HOLDINGS: Delays $175 Million Shares Offering ----------------------------------------------------- Euramax Holdings, Inc., filed with the Securities and Exchange Commission AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 to delay a planned offering of common stock. The Company plans to raise up to $175 million in the offering, according to an accompanying preliminary prospectus. The Company has tapped Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Deutsche Bank Securities Inc. as underwriters. The Company expects to use the net proceeds of the offering to repay term loans under its first lien credit facility. As of July 2, 2010, approximately $524.5 million of term loans were outstanding under the first lien credit facility. The facility terminates on June 29, 2013. Euramax was acquired by private equity funds affiliated with Goldman, Sachs & Co. and certain members of its senior management on June 29, 2005, for $1.038 billion, excluding fees and related expenses, less outstanding debt, net of cash and cash equivalents, and certain transaction expenses. The Company's then-existing equity sponsors made an equity contribution of $311.3 million and management rolled over approximately $20.7 million of equity (which included a rollover of $11.1 million of fully vested and exercisable options). In addition, the Company and its subsidiary Euramax International, Inc. incurred $750.0 million of debt to finance the Acquisition. On June 29, 2009, the Company, its then-existing equity sponsors, its lenders and management shareholders agreed to a restructuring of indebtedness owed to lenders under its then-existing first and second lien credit agreements and of amounts owed to counterparties to the Company's existing interest rate swaps. The lenders cancelled 100% of amounts owed under the second lien credit agreement, consisting of principal and accrued interest of $191 million and $12 million, respectively, in exchange for 100% of the Company's issued and outstanding common stock as of the date of the Restructuring. Common stock was issued to lenders in proportion to their holdings of the second lien loans immediately prior to the Restructuring. The then-existing equity sponsors lost all of their equity investment in the Company. Since the second quarter of 2008, the Company has worked to operate a more efficient, lower cost business, including closing 26 facilities and reducing supervisory and administrative personnel. A full-text copy of the Company's prospectus is available at no charge at http://ResearchArchives.com/t/s?6ca6 About Euramax Holdings Euramax Holdings Inc. is an international producer of metal and vinyl products sold to the residential repair and remodel, non- residential construction and recreational vehicle markets primarily in North America and Europe. It considers itself a leader in several niche product categories, including preformed roof-drainage products sold in the U.S., metal roofing and siding for wood frame construction in the U.S., and aluminum siding for towable RVs in the U.S. and Europe. At July 2, 2010, the Company had $725,237,000 in total assets, $524,465,000 in total liabilities, and $13,468,000 in shareholders' equity. As of June 30, 2010, Euramax carries "Caa1" long-term debt ratings from Moody's and "B-" long-term debt ratings from Standard & Poor's. EURAMAX HOLDINGS: Posts $22.9 Mil. Net Loss for 2010 First Half --------------------------------------------------------------- Euramax Holdings Inc. disclosed in a filing with the Securities and Exchange Commission that it posted a net loss of $22.9 million for the first half of 2010, ended July 2, 2010, as compared to a net loss of $74.0 million for the first half of 2009, ended June 26, 2009. Euramax has been in the red for the past three years, incurring a $85.6 million net loss for 2009, a $500.6 million net loss for 2008, and a $49.4 million net loss for 2007. The Company said net sales -- which include revenue recognized from the sales of products less provisions for returns, allowances, rebates and discounts -- increased $74.4 million, or 20.2%, to $442.3 million in the first half of 2010 compared to $367.9 million in the first half of 2009 as global economic concerns diminished and pent up demand for many of its products was released. About Euramax Holdings Euramax Holdings Inc. is an international producer of metal and vinyl products sold to the residential repair and remodel, non- residential construction and recreational vehicle markets primarily in North America and Europe. It considers itself a leader in several niche product categories, including preformed roof-drainage products sold in the U.S., metal roofing and siding for wood frame construction in the U.S., and aluminum siding for towable RVs in the U.S. and Europe. At July 2, 2010, the Company had $725,237,000 in total assets, $524,465,000 in total liabilities, and $13,468,000 in shareholders' equity. As of June 30, 2010, Euramax carries "Caa1" long-term debt ratings from Moody's and "B-" long-term debt ratings from Standard & Poor's. EXTENDED STAY: Settles Aecon Construction Claims ------------------------------------------------ Extended Stay Inc. sought and obtained a court order approving a settlement of claims with Aecon Buildings. The deal requires Extended Stay to pay C$135,000 to settle Aecon Buildings' claim in return for the withdrawal of the lawsuit Aecon filed against the company and its affiliates. Aecon Buildings sued Extended Stay, ESA Canada Trustee Inc., ESA Canada Operating Lessee Inc. and HVM Canada Hotel Management ULC after a disagreement ensued over how much should be paid to the firm. Aecon Buildings provided labor and materials for the renovation of the Extended Stay Deluxe Toronto-Vaughan hotel in Vaughan, Canada. It filed the lawsuit to seek payment of C$232,060 for its lien claim, and an additional C$63,640 for damages. The hotel is owned by ESA Canada Trustee and is leased to ESA Canada Operating. The settlement calls for the withdrawal by Aecon Buildings of its proofs of claim that were filed against ESA Canada Trustee and ESA Canada Operating in their bankruptcy cases. It also requires Aecon Buildings to indemnify the defendants and another company, Extended Stay Canada Inc., for any claim asserted by Sirro Brothers Cement Finishing and Spray Ltd. Sirro Brothers is a subcontractor retained by Aecon to help in the renovation of the hotel. It brought a lawsuit against Aecon Buildings, ESA Canada Trustee and Extended Stay Canada to seek payment of C$188,994. The settlement deal is formalized in a four-page agreement, a copy of which is available without charge at: http://bankrupt.com/misc/ESI_SettlementAecon.pdf About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Extended Stay Inc. in October successfully emerged from Chapter 11 protection. An investment group including Centerbridge Partners, L.P., Paulson & Co. Inc. and Blackstone Real Estate Partners VI, L.P. has purchased 100 percent of the Company for $3.925 billion in connection with the Plan of Reorganization confirmed by the Bankruptcy Court in July. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: Starwood Appeal Reimbursement Order -------------------------------------------------- An investment group led by Starwood Capital took an appeal to the U.S. District Court for the Southern District of New York to reverse a decision entered by a bankruptcy judge overseeing the bankruptcy cases of Extended Stay Inc. and its affiliated debtors. The appeal raises the issue of whether Judge James Peck appropriately denied the proposed reimbursement of the Starwood group's expenses "based on the lack of cause shown" and "as an unauthorized use of cash collateral." Judge Peck earlier denied a motion by Extended Stay to reimburse the investment group as much as $7,629,504, for its expenses. The Starwood group was one of the bidders that proposed to fund Extended Stay's restructuring plan. An agreement with Extended Stay required the Debtor to reimburse the Starwood group for its expenses in case the Debtor accepted a bid other than that of Starwood's. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Extended Stay Inc. in October successfully emerged from Chapter 11 protection. An investment group including Centerbridge Partners, L.P., Paulson & Co. Inc. and Blackstone Real Estate Partners VI, L.P. has purchased 100 percent of the Company for $3.925 billion in connection with the Plan of Reorganization confirmed by the Bankruptcy Court in July. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). FBL FINANCIAL: AM Best Affirms Issuer Credit Rating at "bb" ----------------------------------------------------------- A.M. Best Co. has upgraded the financial strength rating (FSR) to A- (Excellent) from B++ (Good) and issuer credit rating (ICR) to "a-" from "bbb+" of Farm Bureau Life Insurance Company (FB Life). Additionally, A.M. Best has affirmed the FSR of B+ (Good) and the ICR of "bbb-" of FB Life's affiliate, EquiTrust Life Insurance Company (EquiTrust). Concurrently, A.M. Best has affirmed the ICR and debt ratings of "bb", as well as the indicative ratings on securities available under the shelf of FBL Financial Group Inc. (FFG) [NYSE: FFG], the parent of FB Life and EquiTrust. The outlook for all ratings has been revised to stable from negative. All companies are domiciled in West Des Moines, IA. (See below for a detailed listing of the debt ratings.) The rating upgrades for FB Life recognize its solid risk-adjusted and absolute capitalization, consistently positive operating earnings and an aggregate unrealized gain position in its investment portfolio. The ratings continue to recognize FB Life's more balanced business profile between life and annuity reserves, stable profitability trends and its strong affinity within the Farm Bureau market. The rating actions also reflect A.M. Best's belief that the significant capital calls from FFG to fund the rapid growth at EquiTrust will no longer be necessary. Thus, the rating drag has been removed from the ratings of FB Life. FB Life will continue to face the challenge of managing spread compression in a low interest rate environment and high, but declining, exposure to real estate related assets. The rating affirmations of EquiTrust reflect its more favorable risk-adjusted and absolute capitalization, which has improved due to the significant decline in annuity production and the company's profitable earnings recorded at year-end 2009 and through the second quarter of 2010, resulting from reduced new business strain and an aggregate unrealized gain position in its investment portfolio. The sales reduction reflects management's recent efforts to make EquiTrust capital self-sufficient and return it to a profitable operating earnings position. While the new product portfolio emphasizes lower strain products and a more balanced approach to annuity and life production, EquiTrust will continue to be challenged to manage spread compression in this low interest rate environment, given the very high interest rate sensitivity of its liability structure. Similar to FB Life, EquiTrust has a high level of real estate related investments. The rating affirmations of FFG acknowledge its adequate interest coverage and leverage position as well as the company's still elevated, albeit reduced, levels of intangibles to equity. A.M. Best notes that FFG has $100 million in private debt due in 2011. FFG has eliminated the unrealized loss position in its fixed income portfolio, and through the second quarter of 2010 is in a gain position reflecting general market improvement and portfolio rebalancing. The revised outlook recognizes A.M. Best's belief that additional investment impairments will likely be within tolerance for the organization's capital position, even as commercial mortgage backed securities and commercial mortgage loan portfolios are likely to remain under pressure for the near term. In addition, A.M. Best believes that spread management will continue to be a challenge for FFG, although spreads are within prescribed targets. The following debt ratings have been affirmed: FBL Financial Group Inc: -- "bb" on $75 million 5.85% senior unsecured notes, due 2014 -- "bb" on $100 million 5.875% senior unsecured notes, due 2017 The following indicative ratings on securities available under the shelf registration have been affirmed: FBL Financial Group Inc: -- "bb" on senior debt -- "bb-" on subordinated debt -- "b+" on preferred stock FBL Financial Group Capital Trust II: -- "b+" on trust preferred securities FISHER COMMUNICATIONS: S&P Withdraws 'B-' Corp. Credit Rating ------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its 'B-' corporate credit rating on Seattle, Wash.-based Fisher Communications Inc. at the company's request. The outlook on the rating was stable prior to the withdrawal. FM AVIATION: Case Summary & 3 Largest Unsecured Creditors --------------------------------------------------------- Debtor: FM Aviation, LLC 3040 Gulf to Bay Blvd. Clearwater, FL 33759 Tel: (727) 724-2600 Bankruptcy Case No.: 10-24832 Chapter 11 Petition Date: October 14, 2010 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Langfred W. White, Esq. LAW OFFICES OF LANGFRED W. WHITE, PA 25400 U.S. Highway 19 North, Suite 160 Clearwater, FL 33763 Tel: (727) 797-5599 Fax: (727) 797-5695 E-mail: lan@lwwhiteattorney.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Frank M. Mongelluzzi, managing member. Debtor's List of three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ World Fuel Services Contract $24,696 2458 Payshere Circle Chicago, IL 60674 Paradigm Jet Contract $6,601 Management 800 Ellis Road #563 Muskegon, MI 49441 Gulfstream Contract $1,215 P.O. Box 730349 Dallas, TX 75373 Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Frank M. Mongelluzzi 10-39289 09/22/2010 FONTAINEBLEAU LV: Ch. 7 Trustee Proposes RMS as Consultant ---------------------------------------------------------- Soneet R. Kapila, the Chapter 7 trustee for Fontainebleau Las Vegas Holdings LLC, seeks the U.S. Bankruptcy Court's permission to retain Fredric Fenstermacher and his firm, Risk Management Solutions, Inc., to serve as his independent risk management consultant. Mr. Kapila tells the Court that he requires the services of an experienced risk management and insurance consulting firm to provide him risk management advice and services. The services will include: -- choosing and working with insurance providers; -- reconciling and evaluating premiums paid and owing; -- resolving pending workers compensation, general liability, property, and other claims; -- filing new claims with insurance carriers; -- performing reconciliations and evaluations of collateral supporting claims; -- preparing and compiling risk assessment reports; -- providing the Chapter 7 Trustee with evidence-based recommendations to improve standing and reduce general risk; and -- compiling and analyzing other additional information as may be requested by the Chapter 7 Trustee or his counsel. Mr. Kapila says Risk Management Solutions has agreed to be compensated in accordance with Section 330 of the Bankruptcy Code. Mr. Fenstermacher, a principal at Risk Management Solutions, assures the Court that neither he nor his firm represent any interest adverse to the Chapter 7 Trustee, the Debtors or the bankruptcy estates with regards to the matters for which they are employed as required by Section 327(a) of the Bankruptcy Code. * * * The Court approved the application and authorized Mr. Kapila to retain Risk Management Solutions. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleu Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC and its units filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represented the Debtors in their restructuring effort. The Debtors' claims agent is Kurtzman Carson Consulting LLC. Attorneys at Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP, represent the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. In February 2010, Icahn Enterprises L.P. acquired from Fontainebleau Las Vegas and certain affiliated entities, the Fontainebleau property and improvements thereon located in Las Vegas, Nevada, for an aggregate purchase price of around $150 million. The bankruptcy case was subsequently converted to Chapter 7. Soneet R. Kapila has been named the trustee for the Chapter 7 case of Fontainebleau Las Vegas. FONTAINEBLEAU LV: Ch. 7 Trustee Wants Kasowitz as Special Counsel ----------------------------------------------------------------- Soneet R. Kapila, the Chapter 7 trustee for Fontainebleau Las Vegas Holdings LLC, sought and obtained authority from the U.S. Bankruptcy Court for the Southern District of Florida to retain Kasowitz, Benson, Torres & Friedman, LLP, as his special litigation counsel, nunc pro tunc to the Conversion Date. Prior to the conversion of the bankruptcy cases to Chapter 7, Kasowitz Benson served as special litigation counsel to the Debtors in connection with an existing litigation against the Revolving Bank Lenders, which include Bank of America, N.A., and Merrill Lynch Capital Corporation. As a result, the firm and its attorneys have a substantial depth of background and knowledge in litigation in which the bankruptcy estate is involved, Mr. Kapila told Judge Cristol. The Lender Litigation remains pending in the United States District Court for the Southern District of Florida. The District Court has entered an order, which sets forth a time schedule that contemplates a two-week trial beginning February 13, 2012, and the imminent commencement of depositions. Because of Kasowitz Benson's prior involvement with the Lender Litigation, the lawyers in that firm have extensive knowledge with respect to conducting discovery and depositions and are well- equipped to continue to represent the estates, Mr. Kapila explained. Kasowitz Benson will be paid based on the firm's standard hourly rates, and will be reimbursed for actual and necessary expenses incurred. The principal attorneys designated to represent Mr. Kapila and their current standard hourly rates are: Professional Rate ------------ ---- Marc E. Kasowitz $1,000 David M. Friedman $950 Adam L. Shiff $825 Jed I. Bergman $685 Seth A. Moskowitz $575 Matthew B. Stein $525 Daniel A. Fliman $525 Cara M. Ciuffani $450 Matthew A. Kraus $365 Other Kasowitz Benson attorneys and paralegals may from time to time serve the Debtors. The billing rates of these Kasowitz Benson professionals are: Professional Hourly Rate ------------ ----------- Partners $550 - $1,000 Special Counsel $525 - $750 Associates $275 - $675 Staff Attorneys $225 - $390 Paralegals $150 - $225 Mr. Kapila submits that Kasowitz Benson's proposed retention meets all the prerequisites for retention of special counsel under Section 327(e) of the Bankruptcy Code. Section 327(e) permits a trustee, with court approval, to employ an attorney that has represented the debtor, if in the best interest of the estate, and if the attorney does not represent or hold any interest adverse to the debtor or to the estate with respect to the matter on which the attorney is to be employed. David M. Friedman, Esq., a member of Kasowitz, Benson, Torres & Friedman LLP, in New York -- dfriedman@kasowitz.com -- assures the Bankruptcy Court that Kasowitz Benson neither represents nor holds any interest adverse to the Chapter 7 Trustee or the bankruptcy estates with respect to the matters upon which the firm is being engaged. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleu Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC and its units filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represented the Debtors in their restructuring effort. The Debtors' claims agent is Kurtzman Carson Consulting LLC. Attorneys at Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP, represent the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. In February 2010, Icahn Enterprises L.P. acquired from Fontainebleau Las Vegas and certain affiliated entities, the Fontainebleau property and improvements thereon located in Las Vegas, Nevada, for an aggregate purchase price of around $150 million. The bankruptcy case was subsequently converted to Chapter 7. Soneet R. Kapila has been named the trustee for the Chapter 7 case of Fontainebleau Las Vegas. FONTAINEBLEAU LV: Waldman Withdraws as Resorts' Counsel ------------------------------------------------------- Sarah J. Springer, Esq., at Waldman Trigoboff Hildebrandt Marx & Calnan, P.A., in Weston, Florida, asks the U.S. Bankruptcy Court to allow her firm to withdraw as counsel for Non-Debtor Fontainebleau Resorts, LLC. She reveals that her firm and Fontainebleau Resorts have developed irreconcilable differences between them concerning a certain litigation commenced by Wilmington Trust FSB, et al. An order in the Litigation restrained Fontainebleau Resorts' ability to transfer any of its assets for any purpose, including the payment of attorneys' fees and expenses. Accordingly, Ms. Springer contends that the firm has no present ability to be compensated for its legal services. She assures the Court that there will be no prejudice to any parties if the firm is allowed to withdraw its services. The Court will convene a hearing on October 21, 2010, to consider the request. Plaintiffs Object Plaintiffs in Avenue CLO Fund, Ltd., et al. v. Bank of America, N.A., et al., No. 09-cv-23835-ASG and ACP Master, LTD., et al. v. Bank of America, N.A., et al., No. 10-cv-20236- ASG, and Defendant Bank of America, N.A., jointly inform the Court that recent developments in the Litigation have eliminated the basis for Waldman's withdrawal motion. On September 27, 2010, the parties to the Litigation entered a stipulation to dissolve the temporary restraining order. Nonetheless, Waldman has confirmed that it intends to proceed with its withdrawal motion even though there is no longer any legal impediment to it being paid and no indication that Fontainebleau is refusing to pay Waldman, the Plaintiffs say. Hence, they point out, Waldman's motion is baseless, and Waldman should only be permitted to withdraw as counsel to the extent that the withdrawal will not further delay Fontainebleau's compliance with outstanding subpoenas. Waldman Replies What the Term Lenders and Defendant fail to mention in their objection is that the $1.036 billion judgment entered against Fontainebleau and which prompted the TRO has not been dissolved, vacated or otherwise nullified, Ms. Springer says. She contends that under the circumstances of that judgment, Fontainebleau has no present ability to compensate Waldman for its ongoing services in the Litigation or other proceeding. Ms. Springer points out that the irreconcilable differences still exist between the Firm and Fontainebleau, and the basis for the request has not been eliminated as the Term Lenders and Defendant speculatively assert. Hence, she insists that Waldman should be permitted to withdraw, and to be relieved of further obligations. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleu Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC and its units filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represented the Debtors in their restructuring effort. The Debtors' claims agent is Kurtzman Carson Consulting LLC. Attorneys at Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP, represent the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. In February 2010, Icahn Enterprises L.P. acquired from Fontainebleau Las Vegas and certain affiliated entities, the Fontainebleau property and improvements thereon located in Las Vegas, Nevada, for an aggregate purchase price of around $150 million. The bankruptcy case was subsequently converted to Chapter 7. Soneet R. Kapila has been named the trustee for the Chapter 7 case of Fontainebleau Las Vegas. FREDDIE MAC: Clayton Rose Elected to Board of Director ------------------------------------------------------ Freddie Mac announced that that Clayton S. Rose, Professor of Management Practice at Harvard Business School and veteran executive in the financial services and investment industries, was elected to serve as a director on the Company's board. "Clayton Rose brings to Freddie Mac's board of directors a wealth of financial and management experience," said John A. Koskinen, Freddie Mac's non-executive chairman. "His years of managing large and complex financial organizations, and his practical insight into the workings of global markets, are particularly valuable to our board as Freddie Mac continues to serve its vital mission of providing liquidity, stability and affordability to the nation's housing finance system." Mr. Rose has been a member of the faculty at Harvard Business School since July 2007. He was awarded a PhD in sociology from the University of Pennsylvania in 2007. Rose served as an adjunct professor at the Stern School of Business at New York University from 2002 to 2004, and at the Graduate School of Business at Columbia University from 2002 until 2006. In 2001, Mr. Rose served as vice chairman and chief operating officer of JP Morgan, the investment bank of J.P. Morgan Chase & Co. Previously, he worked at J.P. Morgan & Co. Incorporated from 1981 to 2000, where, among other positions, he was head of the Global Investment Banking and the Global Equities Divisions and served as a member of the firm's executive committee. Mr. Rose is a member of the board of directors of XL Group plc, where he is a member of the Nominating, Governance and External Affairs Committee and Risk and Finance Committee. He is a trustee of the Howard Hughes Medical Institute and the National Opinion Research Center at the University of Chicago, and is a director of Public/Private Ventures. From November 2007 to March 2010, he served as chairman of the board of Highbridge Capital Management, an alternative investment management firm owned by JP Morgan Chase & Co. Rose previously served as a member of the board of directors of Mercantile Bankshares Corporation, from September 2003 to April 2007, and of Lexicon Pharmaceuticals, Inc., from September 2003 through October 2007. About Freddie Mac Based in McLean, Virginia, Freddie Mac (NYSE: FRE) -- http://www.FreddieMac.com/-- was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters. Freddie Mac is under conservatorship and is dependent upon the continued support of Treasury and FHFA to continue operating its business. The Company received $6.1 billion and $30.8 billion in June 2009 and March 2009, respectively, pursuant to draw requests that FHFA submitted to Treasury on the Company's behalf to address the deficits in the Company's net worth as of March 31, 2009, and December 31, 2008, respectively. As a result of funding of the draw requests, the aggregate liquidation preference on the senior preferred stock owned by Treasury increased from $14.8 billion as of December 31, 2008, to $51.7 billion on December 31, 2009. FREDERICK BERG: Meridian Founder Charged With $350MM Fraud ---------------------------------------------------------- Bankruptcy Law360 reports that federal prosecutors have unsealed a 10-count wire fraud and money laundering case against a Seattle- area man accused of raising more than $350 million between 2001 and 2010 for his now-bankrupt Meridian Mortgage investment company and using the money to pay for a mansion, jets and expensive cars. Four of defendant Frederick Darren Berg's Meridian real estate funds were forced into bankruptcy in June and others followed quickly thereafter, according to a criminal information lodged Thursday, Law360 says. About Frederick Berg Frederick Darren Berg filed for Chapter 11 protection on July 27, 2010 (Bankr. W.D. Wash. Case No. 10-18668), estimating assets of more than $10 million and liabilities between $1 million and $10 million. The filing came after lawyers for one group of investors, armed with a court order and accompanied by sheriff's deputies, began seizing personal possessions at Mr. Berg's Mercer Island home and downtown Seattle condo. Mr. Berg was facing a suit for alleged failure to pay interest payments to Meridian Group fund investors from whom Mr. Berg raised at least $145 million. Investors made an involuntary Chapter 11 filing against four of the funds on July 8, 2010. GENERAL GROWTH: Bankruptcy Court Allows Capital Raise ----------------------------------------------------- Bankruptcy Judge Allan Gropper permitted General Growth Properties, Inc., to enter into the Equity ROFO Letter, the Pre- Emergence Underwriting Agreement, the Guarantee, Commitment Letter, the Fee Letter, and the Side Letter, and Potential Engagement Letter Extensions, and to undertake the obligations set forth therein, including, but not limited to, paying any fees plus any expenses required under the Agreements. According to Bloomberg News, Judge Gropper referred to the financing agreements as an indication "of the enormous success" of GGP's progress while under Chapter 11. Judge Gropper held that if the Debtors determine to enter into the Pre-Emergence Underwriting Agreement and Guarantee, they will file a separate motion, subject to the reservations of right by the U.S. Trustee for Region 2, the Debtors and all other parties. U.S. Trustee Questions UBS's Disinterestedness Tracy Hope Davis, U.S. Trustee for Region 2, objected to UBS Securities, LLC's participation in the capital raise asserting that "UBS comes by way of the Debtors' Motion seeking to assume additional and potentially more lucrative roles as a lender to the Debtors and an underwriter of the capital raise." Counsel to the U.S. Trustee, Andrew B. Schwartz, Esq., in New York, asserted that the Bankruptcy Code and the law of this circuit are very clear that as a professional retained under Section 327(a) of the Bankruptcy Code, UBS must not have any interest or relationship, however slight, that would faintly color the independence and impartial attitude the law requires. The U.S. Trustee previously objected to the employment of UBS as the Debtors' financial advisor due to the firm's apparent lack of disinterestedness, he pointed out. UBS's proposed roles, which are traditionally situated on the other side of the negotiating table from the Debtors, demonstrate that UBS (i) is holding interests adverse to the Debtors' estates; (ii) is no longer disinterested; and (iii) suffers from disabling conflicts of interest, Mr. Schwartz argued. He also stressed that the Debtors have failed to submit any affidavits to support their assertion that the Court's approval of UBS as underwriter and lender commitment party does not affect the firm's disinterestedness as the Debtors' financial advisor. The U.S. Trustee also objected to the Debtors' entry into a pre- emergence mandatorily exchangeable notes offering. Mr. Schwartz asserts that the Debtors have failed to provide the parties-in- interest, including the U.S. Trustee with a copy of the Pre- Emergence Underwriting Agreement. UBS Defends Roles in Financing Deals "Despite the incredibly successful outcome of the Debtors' Chapter 11 cases, the U.S. Trustee is once again seeking to limit UBS's role in these Chapter 11 cases, even though UBS's efforts have undeniably contributed to the Debtors' success," counsel to UBS, Jay M. Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York --jay.goffman@skadden.com -- told the Court. Mr. Goffman asserted that it was always contemplated and disclosed that the Debtors may seek to take advantage of UBS's strength in raising capital. UBS has strong knowledge of the Debtors, the potential public offering that the Debtors may conduct and has strong equity capabilities that will help the Debtors complete their offering, he insisted. Indeed, Goldman Sachs, as "lead left" underwriter, and Deutsche Bank are the two joint global coordinators primarily responsible for coordinating all bookrunning activities, Mr. Goffman clarified. The joint global coordinators will be the primary parties in setting initial price ranges to the market. In other words, UBS will not control pricing, he pointed out. As to the proposed debt facility, Deutsche Bank, Wells Fargo Securities, and RBC Capital Markets Corp. are the joint lead arrangers that drive the syndication and terms in the market, he further notes. UBS will simply be a terms maker and will not dictate the terms, he added. With respect to the Pre-Emergence Mandatorily Exchangeable Notes Offering, the Debtors informed UBS that they will withdraw the request to pursue the Pre-Emergence Mandatorily Exchangeable Notes Offering at this time, Mr. Goffman related. Objections Overruled All objections to the Exit Financing Motion or the relief sought in the Exit Financing Motion that have not been withdrawn, waived, settled, or specifically addressed in this order, and all reservations of rights included in those objections, are overruled in all respects on the merits, Judge Gropper ruled. The U.S. Trustee's objection, according to Bill Rochelle of Bloomberg News, was resolved through a closed-door meeting with the Court. The Court authorized the Debtors to accept the financing commitments upon terms substantially similar to the terms set forth in the Commitment Letter and Fee Letter; provided, however, that (a) the payment of any fees to UBS will be made immediately; and (b) UBS will be approved as an Underwriter and Lender Commitment Party effective after the entry of the confirmation order. Judge Gropper held that nothing in the order will prevent the Debtors from naming UBS as Underwriter or Lender Commitment Party on any documents before entry of the Confirmation Order or prevent UBS from doing any preparatory work or executing any documents in preparation for being an Underwriter or Lender Commitment Party. Judge Gropper granted the payment obligations of the Debtors under the Commitment Letter and the Fee Letter administrative priority under Sections 503(b) and 507(a)(1) of the Bankruptcy Code. Judge Gropper also authorized the Debtors to exercise the Clawback Election and to incur any related Clawback Fee. Judge Gropper deferred the determination of UBS's status as a disinterested person after March 11, 2010, or whether UBS represents or holds an interest adverse to GGP's estates, subject to the reservations of right by the U.S. Trustee, UBS, and all other parties. UBS's engagement as an Underwriter or Lender Commitment Party will not however limit or modify the terms of UBS's engagement under the UBS Retention Orders, Judge Gropper clarified. In a related order, Judge Gropper held that GGP may file under seal the Fee Letter, Side Letter, unredacted Potential Engagement Letter Extensions, and unredacted Equity ROFO Letter as exhibits to the Financing Motion. However, redacted versions of the Potential Engagement Letter Extensions and the Equity ROFO Letter as agreed to between the Debtors and the U.S. Trustee will be filed with the Court immediately upon entry of this order. The Fee Letter, Side Letter, the Unredacted Potential Engagement Letter Extensions, and the Unredacted Equity ROFO Letter, if filed under seal, will remain under seal and confidential and will not be made available to any party other than the Court and the Limited Notice Parties, Judge Gropper ruled. Indeed, before entry of the sealing order, the Debtors informed the Court that Goldman, Sachs & Co. and Deutsche Bank Securities, Inc., agreed on the terms of the Potential Engagement Letter Extensions. Due to the confidential nature of the Potential Engagement Letter Extensions, GGP filed the Potential Letter Extensions under seal in accordance with the Court's order on October 7, 2010. 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: Names Members to Spin-Off's Board ------------------------------------------------- General Growth Properties, Inc. (NYSE: GGP) named the individuals that will comprise the nine-member Board of Directors for the spin-off company that will consist of GGP's portfolio of master planned communities and other real estate assets with long-term potential. GGP also announced the spin-off company will be named The Howard Hughes Corporation. The Howard Hughes Corporation Board of Directors will assume its responsibilities following the spin-off, which is expected to occur upon GGP's emergence from bankruptcy in early November. The Company intends to name William A. Ackman Chairman at that time. "I am extremely pleased that we have assembled such an experienced, talented and dynamic group of individuals to serve as directors of The Howard Hughes Corporation," said Bill Ackman, Chairman Designee of the Board of The Howard Hughes Corporation. "I also believe the Howard Hughes name -- which reflects the success and vision of one of our country's greatest entrepreneurs -- is a fitting brand for this world-class portfolio of real estate assets. We look forward to working to create long-term value for our shareholders." The following eight individuals will be members of The Howard Hughes Corporation Board of Directors. One seat on the Board of Directors will be reserved for the company's Chief Executive Officer, who is expected to be announced after the spin-off is completed. * Bill Ackman -- Founder and Chief Executive Officer of Pershing Square Capital Management, L.P. and a director of General Growth Properties, Inc. from June 2009 to March 2010. Mr. Ackman will serve as the Chairman of the Board of The Howard Hughes Corporation. * David Arthur -- Managing Partner, Real Estate Investments -- North America, for Brookfield Asset Management * Adam Flatto -- President, The Georgetown Company, a privately held real estate investment and development company based in New York City * Jeff Furber -- Chief Executive Officer of AEW Capital Management, L.P., which provides real estate investment management services to investors worldwide * Gary Krow -- President, CEO and a director of GiftCertificates.com, a leading eCommerce provider of B2B incentive management solutions. Formerly, President of Comdata Corporation, a subsidiary of Ceridian Corporation. * Allen Model -- Co-Founder, Treasurer and Managing Director of Overseas Strategic Consulting, Ltd., an international consulting firm that provides public information services to clients worldwide * Scot Sellers -- Chief Executive Officer of Archstone, one of the world's largest apartment companies, and former Chairman of the National Association of Real Estate Investment Trusts (NAREIT) * Steve Shepsman -- Executive Managing Director and Founder of New World Realty Advisors, a real estate advisory firm with expertise in real estate restructuring, development and finance, and Chair of the Official Committee of Equity Holders in the Chapter 11 proceedings of General Growth Properties, Inc. Messrs. Ackman, Model and Krow are designees of Pershing Square Capital Management, L.P. whose investment agreement with The Howard Hughes Corporation allows it to name three members of the Board. Mr. Arthur is a designee of Brookfield Asset Management, whose investment agreement with The Howard Hughes Corporation allows it to name one member of the Board. 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: Parties Lodge Objections, Support for Plan ---------------------------------------------------------- Various parties have filed objections to confirmation of General Growth Properties Inc.'s proposed plan of reorganization. -- Creditors Committee Members The Official Committee of Unsecured Creditors says it supports confirmation of General Growth Properties, Inc. and its 125 debtor affiliates' Third Amended Joint Plan of Reorganization. However, the Creditors' Committee reserves its rights to object with respect to (i) the Unmatured Rouse Notes in Classes 4.6-4.8 and (ii) the 2006 Bank Loan Claims in Class 4.9. Counsel to the Creditors' Committee, Michael S. Stamer, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, insists that the cash out option afforded to REP Investments, LLC; Fairholme Capital Management, LLC and Pershing Square Capital Management L.P. with respect to their Unmatured Rouse Notes to offset their cash obligations under the Investment Agreements would be inconsistent with Section 1123(a)(4) of the Bankruptcy Code if not for the current trading prices of the Unmatured Rouse Notes. The current trading prices, Mr. Stamer points out, indicate that the treatment of the non-Investor Unmatured Rouse Notes will not result in less favorable treatment of those notes vis-a-vis the cash out option afforded to the Investors. The Creditors' Committee thus reserves its rights to object if the trading market changes before the confirmation hearing that would result in less favorable treatment for the non-Investor holders of Unmatured Rouse Notes. In conjunction with the Creditors' Committee's response, members of the Creditors' Committee, Bank of New York Mellon Trust Company, N.A. and Wilmington Trust Company filed separate objections. Counsel to BoNY, Ronald L. Cohen, Esq., at Seward & Kissel LLP, in New York, insists that the possibility remains that by the confirmation hearing, the market price for the Unmatured Notes will have fallen below par. If that happens, then the cash- out of the Investor's Unmatured Notes will result in a higher recovery for the Investors in respect of the Unmatured Notes will provide to the non-Investor holders, he emphasizes. Thus, should the value of the Unmatured Notes decline in the marketplace before the confirmation hearing, BoNY reserves its right to object to confirmation of the Plan. -- Comptroller of State of NY The Comptroller of the State of New York, as trustee of the Common Retirement Fund, disputes the cure amount set forth in the Third Amended Joint Plan of Reorganization for its claim under a $254 million promissory note made by GGP Limited Partnership. Counsel to the Comptroller, Andrew C. Gold, Esq., at Herrick, Feinstein LLP, in New York -- agold@herrick.com -- insists that the Comptroller is entitled to a pendency interest on its claim at the contract default rate of 8.95% for the period from the Petition Date through the effective date of the Plan. However, the proposed treatment of the Comptroller's secured claim under the Plan is to cure and reinstate the Note by payment of $23.7 million in accrued interest through September 30, 2010, he complains. -- California Franchise Tax Board The state of California Franchise Tax Board objects to the confirmation of the Third Amended Joint Plan of Reorganization because it: (1) imposes inappropriate restrictions on allowance of administrative expenses for taxes incurred postpetition by (i) denying payment for interest on postpetition taxes; and (ii) requiring governmental units to file requests for payment as a condition to allowance; and (2) the Plan appears as if it may improperly release claims against non-debtor entities. The provisions on the administrative expense claims are in direct conflict with Section 503(b) of the Bankruptcy Code, Jonathan P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, in Washington, D.C. -- jguy@orrick.com -- asserts on behalf of the Tax Board. He also contends that the Plan Debtors have not made any showing of "unusual circumstances" to justify that release. Nor does the Plan provide for a channeling injunction or any other mechanism to ensure that released claims will be otherwise paid, he points out. -- Oracle America Oracle America, Inc., opposes confirmation of the Third Amended Joint Plan of Reorganization because of the Plan Debtors' failure to identify the contracts for assumption. As a result, Oracle complains that it is unable to assess the impact of the proposed assumption. Oracle also objects to the Plan Debtors' intent to allow Spinco access to certain of the Debtors' services, including Oracle's JD Edwards Applications pursuant to a Transition Services Agreement. Oracle tells the Court that the "shared" access exceeds the scope of the Oracle licenses' permitted uses, and would result in an unauthorized "splitting" of the licenses between the Debtors and Spinco, as a transitional user of the Debtors' choosing. Oddly, no JDE contracts have been identified for assumption by the Debtors, Oracle points out. Equity Committee Supports Plan The Official Committee of Equity Security Holders says it continues to support confirmation of the Third Amended Joint Plan of Reorganization, which it believes achieves a significant recovery for equity. Despite the parties' best efforts, issues remain with respect to the Spinco-related agreements in the Plan Supplement and the Spinco transition, John Jerome, Esq., at Saul Ewing LLP, in New York, counsel to the Equity Committee, relates. Among other things, if a Spinco Note is issued under the Plan, New GGP's obligation to indemnify Spinco with respect to significant tax liabilities that will be payable with respect to prior sales of master planned communities assets, may be voided or significantly reduced, he notes. Hence, the size of any possible Spinco Note is of vital interest to shareholders and its calculation is a continuing process, as the component parts of the calculation remain fluid, he points. Notwithstanding those issues, the Equity Committee remains hopeful that the open issues related to the Spinco Note can be resolved by the confirmation hearing or the Effective Date of the Plan. The Equity Committee will continue to work alongside the Debtors and the Investors to achieve resolution of all open matters relating to General Growth Properties, Inc. and affecting equity interests in these Chapter 11 cases. Voting Certification Deadline Judge Allan L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York extended the voting certification deadline for all votes on the Third Amended Joint Plan of Reorganization to October 18, 2010. Likewise, Judge Gropper waived the requirement under Rule 3018-1 of the Local Bankruptcy Rules for the Southern District of New York that voting certification be filed not less than seven days before the confirmation hearing. At a hearing held September 23, 2010, the Court reserved consideration of the altering the Voting Certification Deadline, and approved the Disclosure Supplement to the Disclosure Statement and Third Amended Joint Plan of Reorganization. Judge Gropper finds that sufficient cause exists to extend the Voting Certification Deadline. Specifically, Judge Gropper determined that because the Voting Certification Deadline and the re-solicitation voting deadline for the Hughes Heirs have been set on October 14, 2010, completion of the certification by the then Voting Certification Deadline is impracticable. 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) GLOBAL ENTERTAINMENT: Posts $566,000 Net Loss in August 31 Quarter ------------------------------------------------------------------ Global Entertainment Corporation filed its quarterly report on Form 10-Q, reporting a net loss attributed to Global of $566,000 on $1,824,000 of revenue for the three months ended August 31, 2010, compared with a net loss attributable to Global of $249,000 on $2,370,000 of revenue for the same period ended August 31, 2009. The Company's balance sheet at August 31, 2010, showed $2,606,000 in total assets, $2,614,000 in total liabilities, and a stockholders' deficit of $8,000. As reported in the Troubled Company Reporter on September 20, 2010, Semple, Marchal & Cooper, LLP, in Phoenix, Ariz., expressed substantial doubt about the Company's ability to continue as a going concern, following its results for the fiscal year ended May 31, 2010. The independent auditors noted that the Company has experienced a significant decline in operations, cash flows and liquidity. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6ca2 About Global Entertainment Tempe, Ariz.-based Global Entertainment Corporation (OTC BB: GNTP) -- http://www.globalentertainment2000.com/-- is an integrated events and entertainment company focused on mid-size communities that is engaged, through its seven wholly owned subsidiaries, in sports management, multi-purpose events and entertainment centers and related real estate development, facility and venue management and marketing and venue ticketing. HAWK CORP: S&P Shifts CreditWatch on 'B' Rating to Positive ----------------------------------------------------------- Standard & Poor's Ratings Services said that it has revised the CreditWatch implications on its 'B' corporate credit rating for Ohio-based Hawk Corp., to positive from developing, where they were placed on July 2, 2010. "The rating action follows the announcement that Carlisle Cos. Inc. will acquire Hawk for $413 million," said Standard & Poor's credit analyst Gregoire Buet. "Hawk's board of directors has approved a sale of the company to Carlisle. Carlisle and Hawk expect closing to occur by year-end." Standard & Poor's will resolve the CreditWatch listing once the transaction closes. The transaction is subject to regulatory approval. HENRY ANDERSON: Court Extends Cash Collateral Use Until Nov. 4 -------------------------------------------------------------- The Hon. Randy D. Doub of the U.S. Bankruptcy Court for the Eastern District of North Carolina has authorized Henry L. Anderson, Jr., to continue using cash collateral until November 4, 2010, which is the date set for the hearing on conformation of the proposed Chapter 11 plan and other matters. On September 2, 2010, the Court entered an order allowing the Debtor to use rents generated by its properties cash collateral through September 24, 2010, which was the scheduled date for the hearing on the confirmation of the Debtor's plan. The Court also ruled that the Debtor was authorized to distribute a portion of the remaining funds from the sale of his property at 816 Schloss: (a) to Crescent Bank, the amount of $30,000, as adequate protection for its loan secured by the Debtor's property at 232 Causeway Drive in Wrightsville Beach, North Carolina, and (b) to the Debtor, the amount of $20,000, to pay for the postpetition, necessary and reasonable expenses of operating his law office and his rental properties and for his personal living expenses. On September 9, 2010, Internal Revenue Service asked the Court to reconsider and alternatively for a temporary restraining order, asking the Court to reconsider its previous ruling. On September 13, 2010, the Debtor asked the Court to continue hearings, requesting that the hearing scheduled for September 24, 2010, on the confirmation of the Debtor's plan and other matters be continued to November 4, 2010. On September 15, 2010, the Court allowed the Debtor to use cash collateral and to partially distribute sale proceeds. In light of the IRS' pending motion, Stubbs & Perduc, P.A., retained the sales proceeds in its trust account. On September 20, 2010, in a telephonic hearing, the Court made these determinations: A. the Court would grant the Debtor's motion to continue hearings through November 4, 2010; B. the Debtor would be permitted to use the $20,000 from the sales proceeds and the rents generated from the lease of all of its properties through the date of the continued hearings subject to the payment of adequate protection: (a) To Cresent Bank, (i) an immediate payment of $30,000 from the sales proceeds as set for in the Court's September 15, 2010 order, (ii) two payments in the amount of $7,083.33 each to be made on October 1, 2010, and November 1, 2010, from the sales proceeds; (b) To BB&T, the amount of $2,000 to be made on October 20, 2010, from the sales proceeds; (c) To the IRS, the remaining sales proceeds in the amount of $33,833.34, to be made on October 1, 2010; and (d) To First Bank, one-half of the net rental income generated by its collateral, after expenses and commission payments to the management company. The Court affirms its previous order with respect to the payment of $30,000 of the sales proceeds to Crescent Bank, and distribution of $20,000 to pay for the postpetition, necessary and reasonable expenses of operating law office and rental properties and for personal living expenses of the Debtor. The Debtor will pay to Crescent Bank additional adequate protection from the sales proceeds in two payments of $7,083.33 each to be made on October 1, 2010, and November 1, 2010, respectively. The Debtor will continue to pay First Bank adequate protection in an amount equal one-half of the net rental income, after expenses and commission payments to the management company, through November 4, 2010. The Debtor will pay BB&T additional adequate protection from the sales proceeds in the amount of $2,000 on October 20, 2010. About Henry L. Anderson, Jr. Wrightsville Beach, North Carolina-based Henry L. Anderson, Jr., filed for Chapter 11 bankruptcy protection on February 3, 2010 (Bankr. E.D. N.C. Case No. 10-00809). Trawick H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., assists the Company in its restructuring effort. In its schedules, the Company disclosed assets of $17,913,107, and total debts of $10,730,549. HERBALIFE INTERNATIONAL: Moody's Upgrades Default Rating to 'Ba1' ----------------------------------------------------------------- Moody's Investors Service upgraded Herbalife International, Inc.'s Probability of Default Rating to Ba1 from Ba2. The company's Corporate Family Rating and the senior secured bank credit facility rating were affirmed at Ba1. The outlook remains stable. Ratings Rationale The upgrade in the Probability of Default rating to Ba1 from Ba2 acknowledges Herbalife's continued strong operating performance and its improved sales leader retention rate. As Herbalife's probability of default continues to decline, asset recovery rates in the event of default have become less clear. Thus, Moody's is applying its standard 50% family recovery rate to Herbalife instead of the previously used 65% rate. Herbalife's Ba1 Corporate Family Rating reflects its very strong credit metrics, healthy liquidity profile, conservative capital structure, significant geographic diversification with sales in 73 countries, and the stable sales performance of its core meal- replacement products. These positive attributes are offset by the company's modest scale, sales concentration in a relatively narrow product segment -- meal replacement shakes and nutritional supplements -- and its small market share in the broader packaged food market. The rating also acknowledges the ongoing challenges of the multi-level selling model, particularly the high turnover of the sales representatives. This rating was upgraded: -- Probability of Default Rating to Ba1 from Ba2. These ratings were affirmed and LGD point estimates adjusted: -- Corporate Family Rating at Ba1; -- $250 million secured revolving credit facility at Ba1 (to LGD 3, 40% from LGD 2, 27%); -- $200 million secured term loan at Ba1 (to LGD 3, 40% from LGD 2, 27%); The stable outlook reflects Moody's expectations that the company will continue to generate strong earnings and cash flow and that it will maintain very strong debt protection measures. The outlook assumes that the company will maintain a conservative financial policy. An upgrade is unlikely in the foreseeable future due to the company's narrow product offering. The credit quality of Herbalife would improve should the rate of decline of new sales representatives stabilize in South and Central America and EMEA and the growth rate of active sales representatives turns positive. Ratings could be downgraded should operating performance decline, financial policy become more aggressive, leverage increases meaningfully, or liquidity weaken. In addition, downward rating pressure may result should the number of re-qualified sales leaders continue to decrease, which could lead to weaker operating performance. Herbalife International, Inc., headquartered in Los Angeles, California, is a marketer of weight management meal replacement shakes, nutritional supplements, energy drinks, and skin care products that are sold through a global network of 2.1 million independent distributors in 73 countries. Revenues are about $2.5 billion. INTELLIPHARMACEUTICS: Posts $2.1MM Net Loss in August 31 Quarter ---------------------------------------------------------------- Intellipharmaceutics International Inc. reported a net loss of $2.1 million on $0 revenue for the three-month period ended August 31, 2010, compared with a net loss of $165,739 on $125,590 of revenue for the three month period ended September 30, 2009. The increased period-over-period loss is mainly due to increases in both research and development expenses and increases in selling, general and administrative expenses. As at August 31, 2010, Intellipharmaceutics' cash totaled $2.4 million, compared with $4.1 million as at May 31, 2010. The Company believes that it may receive a refund of approximately C$1.0 million during the fourth quarter of fiscal 2010, comprised of scientific research & development tax credits. The Company's balance sheet at August 31, 2010, showed $4.6 million in total assets, $2.8 million in total liabilities, and stockholders' equity of $1.8 million. As reported in the Troubled Company Reporter on March 5, 2010, Deloitte & Touche LLP, in Toronto, Ontario, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's results for the the 11 month period ended November 30, 2009. The independent auditors noted of the Company's recurring losses from operations and inability to generate sufficient cash flows to meet its obligations and sustain its operations. A full-text copy of the Company's press release is available for free at http://researcharchives.com/t/s?6c9d A full-text copy of the unaudited interim financial statements for the three and nine month periods ended August 31, 2010, is available for free at http://researcharchives.com/t/s?6c9e About Intellipharmaceutics International Toronto, Ontario-based Intellipharmaceutics International Inc. (Nasdaq: IPCI) (TSX: I) -- http://www.intellipharmaceutics.com/-- is a pharmaceutical company specializing in the research, development and manufacture of novel or generic controlled release and targeted release oral solid dosage drugs. The Company's patented Hypermatrix(TM) technology is a unique and validated multidimensional controlled-release drug delivery platform that can be applied to the efficient development of a wide range of existing and new pharmaceuticals. Based on this technology, Intellipharmaceutics has a pipeline of products in various stages of development in therapeutic areas that include neurology, cardiovascular, GIT, pain and infection. INTELSAT SA: Unit Completes Cash Tender Offers to Buy Sr. Notes --------------------------------------------------------------- Intelsat S.A. said that its subsidiary, Intelsat Corporation, completed on Oct. 15, 2010, its cash tender offers to purchase any and all of Intelsat Corp.'s outstanding 9 1/4% Senior Notes due 2014, and Intelsat Corp.'s outstanding 6 7/8% Senior Secured Debentures due 2028, in each case on and subject to the terms and conditions set forth in the related Offer to Purchase and Consent Solicitation Statement. Intelsat Corp. received tenders of $546,286,000 aggregate principal amount of the 2014 Notes, representing approximately 83.0% of the outstanding principal amount of the 2014 Notes, and $124,959,000 aggregate principal amount of the 2028 Notes, representing approximately 99.9% of the outstanding principal amount of the 2028 Notes. Intelsat Corp has purchased all of the Notes validly tendered in the Tender Offers. About Intelsat S.A. Based in Luxembourg, Intelsat S.A. provides fixed satellite services worldwide. Its unit Intelsat Corporation, -- http://www.intelsat.com/-- formerly known as PanAmSat Corporation, is a global provider of video, corporate, Internet, voice and government communications services with a fleet of 25 satellites in-orbit. Intelsat S.A.'s balance sheet at June 30, 2010, showed US$17.34 billion in total assets, US$814.64 million in total current liabilities, US$15.22 billion in long term debt, US$128.77 million in deferred revenue, US$254.63 million in deferred satellite performance, US$548.71 million in deferred income taxes, US$239.87 million in accrued retirement benefits, a US$335.15 million redeemable non-controlling interest, US$8.88 million commitment and contingencies, and a stockholders' deficit of US$210.76 million. Intelsat S.A. reported revenue of US$635.3 million and a net loss of US$180.6 million for the three months ended June 30, 2010. Intelsat S.A., formerly Intelsat, Ltd., carries a 'Caa1' corporate family rating from Standard & Poor's. ISTAR FINANCIAL: Files Financial Information of LNR Property ------------------------------------------------------------ On July 29, 2010, iStar Financial Inc. acquired an approximate 24% ownership interest in LNR Property Corporation as part of a recapitalization of LNR. In the transaction, iStar and a group of investors, including other creditors of LNR, acquired 100% of the common stock of LNR in exchange for cash and the extinguishment of existing senior notes of LNR's parent holding company. iStar's share of the consideration paid was $100 million in cash and $100 million aggregate principal amount of Holdco Notes. LNR used the cash proceeds received from the issuance of the common stock plus other cash on hand to pay down a portion of its existing senior term loan. As a lender under the senior term loan, iStar's loan was paid down from an original principal balance of $102.0 million to $50.8 million. As part of the recapitalization, for so long as iStar maintains a specified ownership interest in LNR, iStar will have the right to designate two members to LNR's board of managers. On October 14, 2010, iStar filed with the Securities and Exchange Commission: * financial statements of LNR, available for free at http://ResearchArchives.com/t/s?6c8f * Pro Forma Financial Information of LNR, available for free at http://ResearchArchives.com/t/s?6c90 About iStar Financial New York-based iStar Financial Inc. (NYSE: SFI) provides custom- tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust, provides innovative and value added financing solutions to its customers. As of June 30, 2010, iStar had $10.653 billion in total assets; total liabilities of $8.802 billion, redeemable non-controlling interests of $7.441 million, and non-controlling interests of $46.602 million; and total equity of $1.843 billion. * * * As reported by the Troubled Company Reporter on July 13, 2010, Standard & Poor's Ratings Services lowered its long-term counterparty credit rating on iStar Financial to 'CCC' from 'B-'. At the same time, S&P lowered the senior unsecured debt rating to 'CCC-' from 'CCC+.' The outlook is negative. iStar's limited funding flexibility and the severe credit quality deterioration in its loan portfolio continue to put negative pressure on the rating. "S&P's analysis indicates that the firm should not become insolvent and has ample liquidity to operate through 2010, but management faces a significant challenge with $3.0 billion in debt coming due in 2011 and $3.5 billion due in 2012," said Standard & Poor's credit analyst Jeffrey Zaun. In the longer term, the company's concentration in highly cyclical commercial real estate will limit the ratings. Although credit- market turmoil and a severe recession impeded capital formation through 2009, the firm's capital ratios improved slightly in first-quarter 2010. Management has been able to execute a rapid pull-back in operations through a protracted and severe recession in CRE markets. JOHN FREDERICK DIXON: Court Slashes Wendel Rosen Fees ----------------------------------------------------- The Hon. Salan Jaroslovsky said when an attorney is appointed by the court to represent an individual debtor-in-possession, the actual client is the bankruptcy estate, not the individual. The Court said debtor's counsel Wendel, Rosen, Black & Dean LLP, blatantly violated this rule. When a creditor objected to the debtor's claim of exemption of over $1 million in retirement funds, Wendel Rosen defended the exemption and argued directly against the interests of the estate. There can be no clearer conflict of interest. Compounding the offense, Wendel Rosen now seeks compensation for these services. The court is usually fairly tolerant of Chapter 11 counsel assisting the debtor individually, so long as compensation is not sought from the estate and so long as the actions taken by counsel are not contrary to the interests of the estate. However, in this case Wendel Rosen more than crossed the line. Counsel appears to have completely forgotten where its loyalties and responsibilities lie. Thus, the Court reduced Wendel Rosen's fees by $8,000, which is the approximate amount Wendel Rosen billed for defending the claim of exemption. Wendel Rosen may not collect these fees from either the estate or the debtor or anyone else, directly or indirectly. Any attempt to be compensated for these services, and future action taken by Wendel Rosen against the interests of the bankruptcy estate, will result in a complete forfeiture of all compensation in the case. A copy of the Court's Memorandum on Application for Compensation dated September 20, 2010, is available at: http://www.leagle.com/unsecure/page.htm?shortname=inbco20100920353 San Rafael, California-based John Frederick Dixon filed for Chapter 11 protection (Bankr. N.D. Calif. Case No. 09-11851) on June 19, 2009. Michael D. Cooper, Esq., at Wendel, Rosen, Black and Dean LLP, represents the Debtor in its restructuring efforts. The Debtor estimated assets and debts of $10 million to $50 million in the Chapter 11 petition. K2 PURE: S&P Corrects Press Release; Puts 'B' Rating to Loan ------------------------------------------------------------ Standard & Poor's Ratings Services said that in the article published on Oct. 14, 2010, the debt amount in the headline was misstated. S&P published this corrected version: S&P is assigning a 'B' issue rating and a recovery rating of '2' to K2 Pure Solutions NoCal L.P.'s $121.5 million senior secured term loan. The stable outlook reflects a long-term tolling agreement with Dow Chemical, reasonable capacity expectations, and the ability to leverage proven technology to produce a high-quality product. Standard & Poor's Ratings Services assigned a 'B' rating to K2 Pure Solutions NoCal L.P.'s $121.5 million senior secured term loan maturing 2015. The recovery rating on the term loan is '2', indicating the expectation for a substantial (70% to 90%) recovery in the event of default. The outlook is stable. K2 is a special-purpose entity formed to build, own, and operate a chlor-alkali chemical plant in Pittsburg, California. The project is indirectly owned by K2 Pure Solutions, which is indirectly owned by Centre Partners and K2's executive management team. S&P rate K2 using Standard & Poor's project finance criteria. KAUFMAN PEBBLE: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: Kaufman Pebble Creek, LLC aka Pebble Creek 3959 E. Thousand Oaks Boulevard Thousand Oaks, CA 91362 Bankruptcy Case No.: 10-32879 Involuntary Chapter 11 Petition Date: October 13, 2010 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: James M. Marlar Petitioners' Counsel: Alan R. Solot, Esq. TILTON & SOLOT 459 N. Granada Avenue Tucson, AZ 85701 Tel: (520) 622-4622 Fax: (520) 882-9861 E-mail: arsolot@tiltonandsolot.com Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Coffee Builders, Inc. Unpaid Invoices $1,519,079 7049 E. Tanque Verde, Suite 105 Tucson, AZ 85715 CIS Roofing, Inc. Unpaid Invoices $162,771 26861 Trabuco, Suite 353 Mission Viejo, CA 92691 Door Pac, LLC Unpaid Invoices $16,052 2201 E. Elvira, Road Tucson, AZ 85756-7026 Horizon Contracting, LLC Unpaid Invoice $12,225 510 S. 52nd Street, Suite 101 Tempe, AZ 85281 KOWALLIS AND MACKEY: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Debtor: Kowallis and Mackey, III, LLC 398 S. 9th Street Ste. 260 Boise, ID 83702 Bankruptcy Case No.: 10-03333 Chapter 11 Petition Date: October 12, 2010 Court: United States Bankruptcy Court District of Idaho (Boise) Judge: Terry L. Myers Debtor's Counsel: Joseph M. Meier, Esq. COSHO HUMPHREY, LLP P.O. Box 9518 800 Park Blvd, Ste 790 Boise, ID 83707-9518 Tel: (208) 344-7811 Fax: (208) 338-3290 E-mail: jmeier@cosholaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Matthew Mackey, member. LEHMAN BROTHERS: LBIE Seeks Court Ruling on $1 Bil. in Securities ----------------------------------------------------------------- Lehman Brothers International Europe has asked a U.K. court to determine the ownership of over $1 billion worth of securities left in Lehman Brothers Holdings Inc.'s accounts when it filed for bankruptcy protection two years ago, according to an October 11, 2010 report by Bloomberg News. The move came after other units of LBHI, which include those in Switzerland and Hong Kong, contested the ownership of the securities that they had bought and sold to each other in a series of internal transactions. The assets are currently held by LBIE. LBIE's lawyer Iain Miligan said the case is complicated because the bank's transactions had not been as well documented as transactions with the "outside world," Bloomberg News reported. The U.K. court will begin hearing the case this week. The case is the latest twist in a series of lawsuits stemming from the collapse of LBHI in 2008. PricewaterhouseCoopers, the administrators of LBIE, has already been involved in a number of lawsuits including a legal fight over the $2 billion of client money deposited with LBIE. In this case, the Court of Appeal overturned an earlier decision that only Lehman clients who had money segregated for them were entitled to share in billions of dollars deposited with LBIE, Financial Times reported. PwC has now applied to U.K.'s Supreme Court for permission to appeal against the decision, according to the report. Last week a German court rejected a claim made on behalf of LBIE clients to return $1 billion of client money that had been deposited with Germany-based Lehman Brothers Bankhaus prior to LBIE's administration, Financial Times reported. PwC filed a petition before the Frankfurt am Main regional court to have the $1 billion plus interest returned to LBIE by the German affiliate. The German court, however, ruled that the petition should be dismissed, according to the report. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: LBSF & Primus Agree to Settle Claims ----------------------------------------------------- Primus Guaranty Ltd. said it agreed to settle all claims between Primus Financial and Lehman Brothers Special Financing Inc., Bloomberg News reported. Under the deal, Primus Financial paid $17.5 million to terminate all credit swaps and settle all outstanding claims with LBSF. Primus had about $1.1 billion of credit default swaps outstanding with the Lehman unit, according to the report. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Sells 9.9 Million Edelweiss Shares --------------------------------------------------- Lehman Brothers Netherlands Horizons BV sold 9.9 million shares of Edelweiss Capital Ltd. at 53.33 rupees a share, according to data posted by the Bombay Stock Exchange on its Web site on October 1, 2010, Bloomberg News reported. Edelweiss Capital is an Indian provider of financial services. The buyer was not known, according to the report. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LIONS GATE: S&P Shifts CreditWatch on 'B-' Rating to Developing --------------------------------------------------------------- Standard & Poor's Ratings Services revised the CreditWatch implications on its 'B-' corporate credit rating for British Columbia, Canada-domiciled and Santa Monica, Calif.-headquartered Lions Gate Entertainment Corp. and its subsidiary, Lions Gate Entertainment Inc., to developing from negative. S&P initially placed the rating on CreditWatch with negative implications on March 24, 2010, in response to investor Carl Icahn's unsolicited tender offer to acquire all outstanding shares of the entertainment company's common stock. The revision of the CreditWatch implications was in response to Lions Gate's announcement that it has proposed a merger with Metro-Goldwin-Mayer Studios Inc. Lions Gate has not released terms of its merger offer; hence, the financial profile of a combined entity is still to be determined. If a transaction is consummated with minimal additional debt, it could improve Lions Gate's credit metrics, but if substantial debt is involved, financial risk could increase. Accordingly to detailed press reports, MGM has roughly $4 billion of debt, and is preparing for a bankruptcy filing in which its creditors would become equity holders. MGM has one of the industry's largest film libraries, and it produces the lucrative James Bond films. A combination with Lions Gate would bring significant additional film library assets and cash flow, but could entail substantial production funding and financing needs if the new company's management pursues an active production strategy under the MGM brand. Separately, on July 20, 2010, Lions Gate announced that it completed a transaction whereby $100 million of its senior subordinated notes were converted into common shares. The conversion lowered Lions Gate's debt by $100 million and reduced the refinancing risk posed by potential puts of convertible debt in the company's 2012 fiscal year (ending March 31, 2012) by an equivalent amount, leaving about $114 million of putable convertible debt and production loans maturing during that period. The transaction does not change S&P's view that the company's overall financial risk remains very high. The conversion increased the company's share count by about 13%, modestly diluting the Icahn Group's stake to about 33% from 38%. Carl Icahn has stated that he supports Lions Gate's MGM merger proposal, but continues to pursue his litigation regarding the convertible exchange. His tender offer for the remainder of the company's shares expires on Oct. 22. "In resolving the CreditWatch listing, S&P will consider the outcome of the litigation and tender offer, the structure of the proposed merger with MGM, the outcome of the merger proposal, and, if accepted, the combined companies' new business and financial strategies," said Standard & Poor's credit analyst Deborah Kinzer. "S&P could raise the rating if Lions Gate succeeds in merging with MGM with a financial structure and business plan that gives the combined entity a stronger business and financial profile. S&P could lower the rating if an MGM acquisition plan involves higher debt, significant future production funding needs, and, in S&P's view, higher overall financial risk. S&P could also lower the rating if an MGM acquisition does not occur and Carl Icahn's protracted takeover attempts involve, in its assessment, higher credit risk." LIQUIDMETAL TECH: Names Two New Members to Board of Directors ------------------------------------------------------------- Liquidmetal Technologies Inc. has named two new members to the Board of Directors of the Company. Chairman Abdi Mahamedi is welcoming Daniel Young and Ricardo Salas to board seats being vacated by Martin Weinstein and Iraj Azarm. "Liquidmetal Technologies is grateful for the contributions and service of Dr. Weinstein and Mr. Azarm during their tenure as directors. Their insights helped to guide the Company through several complex and important matters," commented Mr. Mahamedi. "We also look forward to benefiting from the insights and experience that our new directors bring to our Board at this exciting phase in our technology's commercialization." Incoming member Daniel Young is president of Irvine Community Development Company LLC, an affiliate of the 140 year old Irvine Company known for the planned development of the Irvine Ranch properties in Orange County, California. In addition to the master planned communities, the Irvine Company is also known for its portfolio of elite investment properties in Orange County, San Diego, West Los Angeles and the Silicon Valley. As president of ICDC, Mr. Young guides all facets of the Irvine Company's community master-planning and development process. Mr. Young also has a history of community involvement which includes 11 years on the Santa Ana City Council, including 8 years as mayor. He has served on the board of directors of several regional agencies. Mr. Young is a graduate of California State University and has a master's degree in public administration from the University of Southern California. Current Liquidmetal Technologies Executive Vice President and former company President Ricardo Salas is also joining the Company's Board of Directors. Mr. Salas previously served as a board member of the Company from April 1995 to May 2003. Prior to his tenure with Liquidmetal Technologies, Salas served as Chairman and Chief Executive Officer of iLIANT Corporation, an information technology and outsourcing service firm in the healthcare industry. Mr. Salas currently serves as a director of CyberDefender Corporation as well as two privately held technology companies. Mr. Salas received his degree in Economics from Harvard College. About Liquidmetal Technologies Based in Rancho Santa Margarita, Calif., Liquidmetal Technologies, Inc. and its subsidiaries are in the business of developing, manufacturing, and marketing products made from amorphous alloys. Liquidmetal Technologies markets and sells Liquidmetal(R) alloy industrial coatings and also manufactures, markets and sells products and components from bulk Liquidmetal alloys that can be incorporated into the finished goods of its customers across a variety of industries. The Company also partners with third- party licensees and distributors to develop and commercialize Liquidmetal alloy products. The Company classifies operations into two reportable segments: Liquidmetal alloy industrial coatings and bulk Liquidmetal alloys. The Company's balance sheet at June 30, 2010, showed $10.28 million in assets, $30.33 million in liabilities, and a shareholders' deficiency of $20.06 million. Stockholders' deficit was $19.15 million at Dec. 31, 2009. Choi, Kim & Park LLP, in Los Angeles, Calif., in an August 6, 2010 report, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has significant operating losses and working capital deficit. LOUISIANA VALVE: Case Summary & 23 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Louisiana Valve & Machine Works, Inc. 4122 Riverview Dr. Port Allen, LA 70767 Bankruptcy Case No.: 10-11571 Chapter 11 Petition Date: October 6, 2010 Court: United States Bankruptcy Court Middle District of Louisiana (Baton Rouge) Debtor's Counsel: John M. Delgado, Esq. 628 St. Joseph Street Baton Rouge, LA 70802 Tel: (225) 383-5080 Fax: (225) 389-0021 E-mail: johndelgadolaw@gmail.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 23 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/lamb10-11571.pdf The petition was signed by Wayne Marchand, owner/president. M & U LLC: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: M & U, LLC 8317 Kennedy Ave. Highland, IN 46322 Bankruptcy Case No.: 10-24667 Chapter 11 Petition Date: October 6, 2010 Court: United States Bankruptcy Court Northern District of Indiana (Hammond Division) Judge: J. Philip Klingeberger Debtor's Counsel: Catherine Molnar-Boncela, Esq. GORDON E. GOUVEIA & ASSOCIATES 433 West 84th Drive Merrillville, IN 46410 Tel: (219) 736-6020 E-mail: geglaw@gouveia.com Scheduled Assets: $1,840,000 Scheduled Debts: $414,250 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Mir S. Igbal, sole manager. MAJESTIC LIQUOR: Plan Provides Full Satisfaction on Most Claims --------------------------------------------------------------- Majestic Liquor Stores, Inc., et al., 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 that the Reorganized Debtors will assume the liability for and obligation to perform and make all distributions or payments on account of all Allowed Claims. All distributions or payments will be made by the respective responsible Reorganized Debtors. The estimated percentage recovery for all creditors is 100%, except for the Class 6 - NRP Claim which is unknown. The payments to be made by Reorganized Majestic under the Plan will be funded from Reorganized Majestic's income and revenues from operation of its business. The payments to be made by Reorganized Majestic Grapevine under the Plan will be funded from (a) available cash on hand held by Reorganized Grapevine and (b) payments received by Reorganized Majestic Grapevine from Reorganized Majestic under the Plan on account of Majestic Grapevine's Rejection Claim against Majestic arising from Majestic's rejection of the lease between Majestic Grapevine and Majestic with respect to the Cuney Property. The payments to be made by Reorganized Majestic Properties under the Plan will be made from the Majestic Properties Savings Account. The payments to be made by the Reorganized Individual Debtors under the Plan will be funded from (a) the funds received by the Reorganized Individual Debtors on account of the Bratton/Fair Tax Refunds, (b) the Reorganized Individual Debtors' future earnings, and (c) other sources of available cash on hand of the Reorganized Individual Debtors. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/MAJESTICLIQUOR_DS.pdf About Majestic Liquor Fort Worth, Texas-based Majestic Liquor Stores, Inc. -- dba Double T Discount Beer & Wine No. 2, et al. -- was incorporated in 1955. It operates Texas retail stores for the sale of liquor, beer, wine and bar supplies. The Company operates 46 retail stores and three wholesale locations. Majestic Liquor together with its affiliates filed for Chapter 11 bankruptcy protection on June 6, 2010 (Bankr. N.D. Tex. Case No. 10-43849). J. Robert Forshey, Esq., and Jeff P. Prostok, Esq., at Forshey & Prostok, LLP, assists the Company in its restructuring effort. Focus Management Group USA Inc. is the Company's financial advisor. The Company estimated its assets and debts at $10 million to $50 million. MEDCLEAN TECHNOLOGIES: Manatuck Reports 15.07% Equity Stake ----------------------------------------------------------- Manatuck Hill Partners, LLC, disclosed in a Schedule 13D/A filing with the Securities and Exchange Commission that it beneficially owns 114,619,669 shares of Common Stock of MedClean Technologies, Inc., representing 15.07% of the shares outstanding as of August 19, 2010, based upon the Company's quarterly report on Form 10-Q for the quarter ended June 30, 2010. The beneficial ownership assumes the issuance of 34,167,225 shares of Common Stock issuable upon the exercise of certain warrants owned by Manatuck Hill Scout Fund, L.P., Manatuck Hill Mariner Master Fund, L.P. and Manatuck Hill Navigator Master Fund, L.P. About MedClean Technologies Based in Bethel, Connecticut, MedClean Technologies, Inc., provides solutions for managing medical waste on site including designing, selling, installing and servicing on site (i.e. "in- situ") turnkey systems to treat regulated medical waste. The Company's balance sheet at June 30, 2010, showed $2.49 million in total assets, $2.54 million in total liabilities, and a $45,852 stockholders' deficit. As reported in the Troubled Company Reporter on March 8, 2010, Child, Van Wagoner & Bradshaw, PLLC, in Salt Lake City, expressed substantial doubt about the Company's ability to continue as a going concern, after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that of the Company's substantial recurring losses. MEDICAL EDUCATIONAL: Court Decides on Chapter 11 Case Status Today ------------------------------------------------------------------ The Hon. Brian K. Tester of the U.S. Bankruptcy Court for the District of Puerto Rico will convene a hearing today, October 19, 2010, at 9:00 a.m., to consider the dismissal or conversion of Medical Educational and Health Services Inc.'s Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. Party-in-interest Dr. Orlando Marini Roman raised the concern whether Orestes Castellanos Rodriguez, the Company's president, was authorized to sign the bankruptcy petition and whether failure to have said authoization must result in the dismissal of the Debtor's case. Headquartered in Mayaguez, Puerto-Rico, Medical Educational and Health Services Inc. filed for Chapter 11 bankruptcy protection on June 3, 2010 (Bankr. D. P.R. Case No. 10-04905). Rafael Gonzalez Velez, Esq., who has an office in San Juan, Puerto Rico, assists the Debtor in its restructuring effort. The Company estimated $10 million to $50 million in assets and $1 million to $10 million in liabilities. MERUELO MADDUX: Investors Propose New Competing Plans ----------------------------------------------------- Bankruptcy Law360 reports that equity holders and secured investors of Meruelo Maddux Properties Inc. have proposed new competing reorganization plans in an ongoing fight over the bankrupt real estate company's future. According to BankruptcyData.com, Legendary Investors Group No. 1 and East West Bank filed a Second Amended Plan of Reorganization and Disclosure Statement. According to the Disclosure Statement, "The Plan provides for the reorganization of the Debtors' affairs to create a strong, well managed and well-financed operation. The Plan's foundation is an $80 million recapitalization via a $5 million cash infusion by Legendary, conversion of approximately $65 million of the proponents' debt to equity and a $10 million Rights Offering to Holders of MMPI Existing Common Stock as of the Effective Date. Such Holders will be offered the right to purchase up to a total of 2,202,500 additional shares of Reorganized MMPI Common Stock, equal to a 10% stake in Reorganized MMPI." About Meruelo Maddux Meruelo Maddux and its affiliates filed for Chapter 11 protection on March 26, 2009 (Bankr. C.D. Calif. Lead Case No. 09-13356). Aaron De Leest, Esq., John J. Bingham, Jr., Esq., and John N. Tedford, Esq., at Danning Gill Diamond & Kollitz, represent the Debtors in their restructuring effort. The Creditors Committee is represented by Victor A. Sahn, Esq., Dean G. Rallis Jr., Esq., Asa S. Hami, Esq., and Tamar Kouyoumjian, Esq., at SULMEYERKUPETZ. The Debtors' financial condition as of December 31, 2008, showed $681,769,000 in assets and $342,022,000 of debts. METALINK LTD: Receives NASDAQ Notice of Noncompliance ----------------------------------------------------- Metalink Ltd. has received notification from The NASDAQ Stock Market that it is no longer in compliance with the continued listing requirements for The NASDAQ Capital Market (Rule 5550(a)(2)) as a result of the closing bid price per share of the Company's ordinary shares falling below the minimum trading price of $1.00 for thirty consecutive business days. NASDAQ provided Metalink with a compliance period of 180 calendar days, or until April 11, 2011, to regain compliance with the bid price requirement before its shares will be delisted from NASDAQ. Compliance is achieved if, at anytime before April 11, 2011, the bid price of the Company's ordinary shares closes at $1.00 per share or more for at least 10 consecutive business days. At the end of such compliance period, the Company may be afforded an additional compliance period of 180 days if it meets the other initial listing requirements of the NASDAQ Capital Market at that time. About Metalink Metalink -- http://www.MTLK.com/-- shares trade on Nasdaq under the symbol "MTLK". MICHAELS STORES: Has Private Placement for $800MM of Senior Notes ----------------------------------------------------------------- Michaels Stores Inc. and certain of its subsidiaries, as guarantors, entered on Oct. 7, 2010, into a Purchase Agreement with Deutsche Bank Securities Inc., Banc of America Securities LLC, Barclays Capital Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Wells Fargo Securities, LLC, relating to the sale of $800,000,000 aggregate principal amount of its 7-3/4% Senior Notes due 2018. The Notes will be sold through a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The Notes have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold absent registration under the Securities Act or applicable state securities laws or applicable exemptions from registration requirements. The Purchase Agreement contains customary representations, warranties and agreements by the Company and indemnification provisions whereby the Company and the Guarantors, on one hand, and the Initial Purchasers, on the other, have agreed to indemnify each other against certain liabilities. The offering is expected to close on October 21, 2010, subject to satisfaction of customary closing conditions. The Company plans to use the net proceeds from this offering, together with cash on hand, to repurchase its outstanding 10% Senior Notes due 2014. A full-text copy of the Purchase Agreement is available for free at http://ResearchArchives.com/t/s?6c92 About Michaels Stores Headquartered in Irving, Texas, Michaels Stores, Inc., is the largest arts and crafts specialty retailer in North America. As of March 9, 2009, the Company operated 1,105 "Michaels" retail stores in the United States and Canada and 161 Aaron Brothers Stores. The Company's balance sheet at July 31, 2010, showed $1.58 billion in total assets, $4.34 billion in total liabilities, and a stockholders' deficit of $2.75 billion. Michaels Stores carries a 'B3' Corporate Family Rating from Moody's. Moody's said the CFR reflects the Company's significant financial leverage and weak credit metrics. It also recognizes Michaels' leadership position in the highly fragmented arts and crafts segment, and its high operating margins. MIDWEST BANC: 401(k) Plan Has Net Assets of $14.3MM at End of 2009 ------------------------------------------------------------------ Midwest Banc Holding Inc. 401(k) Plan and Trust filed on October 15, 2010, an annual report on Form 11-K as of December 31, 2009. The Plan's audited statements of net assets available for plan benefits as of December 31, 2009, showed total net assets of $14,255,852, consisting of total assets of $14,269,261 less $13,409 representing adjustment from fair value to contract value for fully benefit-responsive investment contracts. The Plan is a defined contribution 401(k) plan covering all full- time and part-time employees of Midwest Banc Holdings, Inc., and its subsidiaries who have one month of service or its equivalent and are age 19 or older. It is subject to the provisions of the Employee Retirement Income Security Act of 1974. On May 14, 2010, Midwest Bank and Trust Company, the wholly-owned bank subsidiary of the Company, was closed by the Illinois Department of Financial and Professional Regulation, Division of Banking and placed into receivership by the Federal Deposit Insurance Corporation. The Company's ownership interest in the Bank represented substantially all of the Company's assets. As a result of the Bank's receivership and the termination of service of all active participants, it is the Company's intention to terminate the Plan and distribute all remaining assets to the participants in 2010. A full-text copy of the Form 11-K is available for free at: http://researcharchives.com/t/s?6c94 About Midwest Banc Hindale, Ill.-based Midwest Banc Holdings is the holding company for Midwest Bank and Trust Company. The bank, however, became subject to FDIC receivership on May 14, 2010. Midwest Banc Holdings filed for Chapter 11 protection (Bankr. N.D. Ill. Case No. 10-37319) in Chicago on August 20, 2010. Hinshaw & Culbertson serves as bankruptcy counsel to the Debtor. Midwest Banc disclosed assets of $9,690,937 and debts of $144,746,169 as of the bankruptcy filing. MOBILE COMMUNICATIONS: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: Mobile Communications Holdings, Inc. 4410 Massachusetts Ave, NW, Suite 385 Washington, DC 20016 Bankruptcy Case No.: 10-01003 Chapter 11 Petition Date: October 8, 2010 Court: United States Bankruptcy Court District of Columbia (Washington, D.C.) Judge: S. Martin Teel, Jr. Debtor's Counsel: Natalie S. Walker, Esq. WEBSTER, FREDRICKSON, CORREIA & PUTH 1775 K Street, NW, Suite 600 Washington, DC 20006 Tel: (202) 659-8510 E-mail: nwalker@wfcplaw.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. The petition was signed by David Castiel, CEO. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Ellipso, Inc. 09-0148 02/25/2009 NATIONAL CENTURY: White, et al, Win Nod for Distribution of Funds ----------------------------------------------------------------- In the NCFE Multi-District Litigation, Lead Plaintiffs Larry White, Glenn Schrader, Donna Schrader, Laurie Davis and Gary Davis jointly ask the Ohio Bankruptcy Court to: (1) authorize a procedure for distribution of settlement fund; (2) approve reimbursement of final administration expenses; and (3) approve the payment of certain incentive awards by their counsel, Vianale & Vianale LLP, to the Lead Plaintiffs. The federal securities class action on behalf of shareholders of e-Medsoft.com created a settlement fund of $400,000, plus accrued interest, pursuant to a Court-approved stipulation and settlement. As of June 30, 2010, the amount in the Settlement Fund, net of prior payment of attorneys' fees and expenses and tax-related payments, was $210,615, which is currently held in a segregated, interest-bearing account invested pursuant to the Stipulation. By this motion, the Plaintiffs ask the Court to approve payment from the fund of outstanding settlement administrator's fees and expenses of $78,661. The Net Settlement Fund available for distribution after these payments are made will be $131,954. The Plaintiffs also ask the Court to approve the determinations of the Claims Administrator, Gilardi and Co. LLC, to accept and reject the claims filed in the class action, and to direct distribution of the Settlement Fund. James E. Arnold, Esq., at James E. Arnold & Associates, LPA, in Columbus, Ohio -- jarnold@arnlaw.com -- relates that to date, Gilardi has received and processed 458 Proof of Claim forms in accordance with the terms of the Stipulation and the Court- approved Plan of Allocation. Of the 458 claims received, 109 claims have been adjudged as payable claims. Of the Proof of Claim forms received, 25 claims were postmarked after the Court-approved deadline of July 1, 2009, Mr. Arnold discloses. He submits that it would be fair, reasonable and in the interest of justice to allow the late claims to be eligible to share in the Net Settlement Fund because no delay in the processing or distribution of the Net Settlement Fund has resulted from the processing of these late, but otherwise valid, claims. Accordingly, the Plaintiffs ask the Court to approve the administrative determination not to reject the claims submitted after the July 1, 2009 deadline because of lateness. However, there must be a final cut-off date after which no late claims will be accepted, and the Plaintiffs ask that the final cut-off date be July 9, 2010. Vianale & Vianale asks for permission to make incentive payments of up to $750 each from the funds paid as attorneys' fees, and not from the Settlement Fund, to Lead Plaintiffs Larry White, Glenn Schrader and Donna Schrader. Mr. Arnold asserts that Mr. White and the Schraders remained active in the prosecution of the matter for over five years, and each of the Lead Plaintiffs spent considerable time in support of the litigation. Mr. Arnold assures the Ohio Bankruptcy Court that since the proposed incentive payments will be made by the counsel, the payments will not diminish the Settlement Fund or reduce the amount of money available to fund payments to the Settlement Class. Vianale & Vianale believes that a modest incentive payment is warranted, in view of the time and effort required of Mr. White and the Schraders. District Court Allows Distribution District Court Judge James L. Graham granted the request and appoints Gilardi & Co. LLC to serve as Escrow Agent for purposes of making all distribution of payments. He also authorizes Vianale & Vianale to transfer the Settlement Fund to Gilardi for distribution. The District Court directs that all checks for distribution to Authorized Claimants will bear the notation "Non-Negotiable After 90 Days," and that no check will be negotiated in the Settlement Fund more than 120 days after the date of the check. If there is any balance remaining in the Net Settlement Fund after six months from the date of distribution, and if the amount of the balance is determined by the Plaintiffs' Lead Counsel to be large enough to fund the additional administration expense of a second distribution, the Lead Counsel will reallocate the balance among Authorized Claimants, but only to those claimants, who have cashed their first distribution check, and would receive at least $10 from the second distribution. Thereafter, any balance that still remains in the Net Settlement Fund will be donated to an appropriate non-profit organization selected by the Lead Counsel. Court Grants Summary Judgment to JP Morgan Chase District Court Judge James L. Graham granted JP Morgan Chase Bank, N.A.'s request for summary judgment on all of Plaintiffs Amedisys, Inc., et al.'s claims in their second lawsuit against JPMorgan, et al., pending in the Louisiana state court. The Amedisys claims involve a dispute over $7.3 million worth of accounts receivable allegedly transferred from Amedisys to bank accounts owned by NPF VI, a subsidiary of National Century Financial Enterprises, Inc., and held at JPMorgan. A similar dispute was litigated in Ohio Bankruptcy Court following the collapse of National Century, and it reached the Sixth Circuit on appeal. According to JPMorgan, the claims in the Louisiana lawsuit are barred by res judicata because Amedisys' rights vis-a-vis JPMorgan were resolved in the Ohio bankruptcy case. Judge Graham agreed with JPMorgan's stand, and hence, granted its motion for summary judgment. Amedisys Appeals Ruling Amedisys, Inc., and certain of its affiliates notified the U.S. District Court for the Southern District of Ohio that it will take an appeal to the United States Court of Appeals for the Sixth Circuit from the opinion and order entered by District Court Judge James L. Graham granting JP Morgan Chase Bank, N.A.'s request for summary judgment on all of Plaintiffs Amedisys, Inc., et al.'s claims in their second lawsuit against JPMorgan, et al., pending in the Louisiana state court. About National Century Headquartered in Dublin, Ohio, National Century Financial Enterprises, Inc. -- http://www.ncfe.com/-- was the largest issuer of medical accounts receivable asset backed securities in the United States before it collapsed in bankruptcy in November 2002 amid allegations of widespread fraud and misappropriation of assets. To date, 10 senior executives of the company have been convicted or pled guilty to federal charges of conspiracy, securities fraud, wire fraud, and money laundering arising out of the NCFE securitization program. NCFE -- through the CSFB Claims Trust, the Litigation Trust, the VI/XII Collateral Trust, and the Unencumbered Assets Trust -- is in the midst of liquidating estate assets. The Company filed for Chapter 11 protection on November 18, 2002 (Bankr. S.D. Ohio Case No. 02-65235). The Court confirmed the Debtors' Fourth Amended Plan of Liquidation on April 16, 2004. Paul E. Harner, Esq., at Jones Day, represented the Debtors. NAZIA ROSEHILL: Case Summary & Largest Unsecured Creditor --------------------------------------------------------- Debtor: Nazia Rosehill Holding LLC 9630 Rosehill Road Lenexa, KS 66215 Bankruptcy Case No.: 10-23481 Chapter 11 Petition Date: October 7, 2010 Court: United States Bankruptcy Court District of Kansas (Kansas City) Debtor's Counsel: J. Aaron Cook, Esq. GHAFOOR COOK & ASSOCIATES 136 E Walnut, Suite 300 Independence, MO 64050 Tel: (816) 373-7379 Fax: (816) 222-0757 E-mail: bankruptcy@ghafoorcook.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 ------ --------------- ------------ Johnson County Treasure Property Tax $82,473 111 S Cherry St Olathe, KS 66061 The petition was signed by Nazia Memon, manager/member. NEW BERN: Asks for Oct. 30 Extension of Plan Filing Exclusivity --------------------------------------------------------------- New Bern Riverfront Development, LLC, asks the U.S. Bankruptcy Court for the Eastern District of North Carolina to further extend its exclusive periods to (i) file a plan and explanatory disclosure statement and; (ii) obtain confirmation of the plan. The Debtor wants its plan proposal period extended until October 30, 2010, and its exclusive period to confirm a plan of reorganization extended until December 30, 2010. The Company says its Chapter 11 case involves the resolution of two primary issues: (i) the sale of existing residential condominium units, and (ii) settlement or trial of pending litigation which has been removed from the state court, each which can be expected to take a substantial period of time to complete. Sales have not progressed at the rate expected by the Debtor, resulting in an inability to fund the pending litigation and special counsel for the Debtor has now filed a motion for leave to withdraw from further representation. To complete the discussions and tailor any proposed plan in light of these developments, the Debtor requests a third extension for an additional 60 days in order to finalize the proposed plan and disclosure statement. Cary, North Carolina-based New Bern Riverfront Development, LLC, is the developer of SkySail Condominium, consisting of 121 residential condominiums (plus 1 commercial/non-residential unit) located on Middle Street on the waterfront in historic downtown New Bern, North Carolina, and sells the SkySail Condominiums in the ordinary course of business. The Debtor filed for Chapter 11 bankruptcy protection on November 30, 2009 (Bankr. E.D. N.C. Case No. 09-10340). John A. Northen, Esq., at Northen Blue, LLP, assist the Company in its restructuring effort. The Company has assets of $31,515,040, and total debts of $25,676,781. NEW LEAF: Completes $2 Million Sale of Bridge Notes & Warrants -------------------------------------------------------------- New Leaf Brands Inc. said it completed on October 12, 2010, a unit offering of an aggregate of $2,010,227 -- including the $1,652,273 reported on September 24, 2010 -- of its bridge notes and warrants to accredited investors. The bridge notes were sold at an Original Issue Discount of 12%, and have a 90-day maturity. Each Unit sold consisted of $1,000 principal amount of 12% OID Notes, and warrants to purchase 1,200 shares of common stock at $0.25 per share. The company sold 2,412,273 warrants to the accredited investors in conjunction with this offering. Hudson Securities Inc. acted as exclusive placement agent for the offering and received a fee of $88,920 in cash and 266,760 warrants in conjunction with the offering. About New Leaf Brands Scottsdale, Ariz.-based New Leaf Brands, Inc. develops, markets and distributes healthy and functional ready-to-drink teas under the New Leaf(R) brand. The Company's balance sheet at June 30, 2010, showed $5.92 million in total assets, $7.39 million in total liabilities, and a $1.47 million stockholders' deficit. * * * According to the Troubled Company Reporter on April 8, 2010, Mayer Hoffman McCann P.C., in Phoenix, Ariz., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations, has a working capital deficiency, was not in compliance with certain financial covenants related to debt agreements, and has a significant amount of debt maturing in 2010. OLD COLONY: Blames Demise on Steep Loan Interest Rate ----------------------------------------------------- Old Colony LLC filed for Chapter 11 protection on October 11 in Boston (Bankr. D. Mass. Case No. 10-21100). Old Colony owns the 83-room Inn at Jackson Hole resort in Teton Village, Wyoming. It purchased the property for $26 million in May 2007. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the first and second mortgages are in default. Wells Fargo NA is owed $17.5 million on the first mortgage, while JH Lending Trust has the $3.5 million second mortgage. Old Colony blames its problems in part on the second mortgage, which carries interest at 15% a year. OPEN TEXT: S&P Raises Corporate Credit Rating to 'BB+' ------------------------------------------------------ Standard & Poor's Ratings Services said it raised its long-term corporate credit rating on Waterloo, Ont.-based enterprise software provider, Open Text Corp. to 'BB+' from 'BB'. The outlook is stable. At June 30, the company had US$300 million of reported debt outstanding. At the same time, S&P raised its issue-level rating on the company's US$465 million senior secured facilities by one notch to 'BBB' from 'BBB-', reflecting the higher corporate credit rating. The facilities comprise a US$75 million operating revolver due 2011 and a US$390 million term loan due 2013. The recovery rating on these facilities is unchanged at '1', reflecting S&P's expectation of a very high (90%-100%) recovery in the event of default. "The upgrade reflects S&P's view of Open Text's solid market position, and improved profitability despite difficult market conditions, as well as the company's demonstrated success at integrating acquisitions," said Standard & Poor's credit analyst Madhav Hari. Given its improved size from recent acquisitions, healthy cash generation from substantial recurring maintenance revenue, and strong liquidity position, S&P expects Open Text to be able to accommodate its near-term growth strategy such that adjusted debt leverage stays within the 2x-3x range. These credit metrics are appropriate for the ratings, in S&P's opinion. The ratings on Open Text are constrained by the highly competitive and consolidating technology marketplace in which the company operates, characterized by large, more-integrated suppliers; the company's narrow business risk profile; still-moderate, albeit steadily improving, scale; and the prospect of moderating organic growth, owing to what S&P considers still-weak IT spending and a moderately acquisitive growth strategy. S&P believes these factors are partially offset by Open Text's healthy market position within a niche segment of the broader software industry; ongoing demand for compliance-driven content management solutions; its large base of recurring software maintenance revenue; reasonable customer and geographic diversity; healthy operating margins compared with that of other enterprise software peers; and a history of generating healthy free cash flow. Open Text is the world's largest independent enterprise content management software provider targeting large Global 2000 enterprise customers. The company's products and services are used by about 46,000 customers and millions of users in 114 countries, and it retains a strong presence in the manufacturing/high technology, energy, government, pharma/life sciences, and financial services sectors. ECM software license and support services (an estimated US$3.5 billion-plus addressable market) help large businesses capture, store, and manage unstructured corporate data. The stable outlook on Open Text reflects what Standard & Poor's views as relatively stable near-term demand for ECM software, a meaningful base of recurring maintenance revenue, improved scale, and traction with key channel partners such as SAP (and increasingly Oracle), which should help the company sustain its profitability and credit profile. Despite relatively conservative credit metrics, an upgrade is constrained by Open Text's relatively narrow business risk profile and still-moderate scale. S&P could lower the rating on the company if it adopts a more aggressive financial policy, including debt-financed acquisitions, which could push adjusted debt leverage in excess of 3x, or if experiences a market share loss compared with its rivals. ORLEANS HOMEBUILDERS: CEO Leaving Post After $700,000 Payment ------------------------------------------------------------- Orleans Homebuilders Inc. has struck a deal that would hand its chief executive and chairman of the board $700,000 in exchange for him giving up his role in the company, DBR Small Cap reports. According to the report, Jeffrey P. Orleans has agreed to leave the business his grandfather founded, according to court papers. He has been with the company for 40 years, serving as its CEO and chairman of the board since 1986, and adding the responsibilities of president in the fall of 2009 as well. The report relates that Orleans Homebuilders is poised to implement a reorganization plan that would hand most of the stock in the new Orleans Homebuilders to current majority holders of the company's pre- and post- bankruptcy secured debt. Creditors are voting on that restructuring proposal, following the court's approval earlier this month of the company's disclosure statement, or plan outline, the report notes. About Orleans Homebuilders Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in these 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Del. Case No. 10-10684). Cahill Gordon & Reindell LLP is the Debtor's bankruptcy and restructuring counsel. Curtis S. Miller, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, are the Debtor's Delaware and restructuring counsel. Blank Rome LLP is the Debtor's special corporate counsel. Garden City Group Inc. is the Debtor's claims and notice agent. The Company estimated assets and debts at $100 million to $500 million. PACIFIC AVENUE: Panel Gets OK to Tap O'Dea & Vann as Counsel ------------------------------------------------------------ The Official Consolidated Committee of Unsecured Creditors of Pacific Avenue, LLC, et al., sought and obtained authorization from the Hon. George R. Hodges of the U.S. Bankruptcy Court for the Western District of North Carolina to employ Dennis O'Dea and Christopher M. Vann as bankruptcy counsel, effective September 10, 2010. Messrs. Dennis and Vann will, among other things: a. take necessary action on behalf of the Committee to protect and preserve the collective interests of the unsecured creditors in the Debtors' bankruptcy estates; b. prepare and file on behalf of the Committee all applications, answers, orders, reports, motions and notices in these cases; c. appear before the Court, and other courts as may be appropriate, to represent the interests of the Committee in matters that require representation and to represent and assist the Committee in negotiations with other parties in interests in the cases; and e. perform other legal services for the Committee as may be necessary in the cases. Mr. O'Dea will be paid $350 per hour for his services, while Mr. Vann will be paid $225 per hour. Messrs. O'Dea and Vann assured the Court that they are "disinterested persons" as that term is defined in Section 101(14) of the Bankruptcy Code. Pacific Avenue, LLC, is a North Carolina limited liability company whose principal place of business is located in Charlotte, North Carolina. Together with Pacific Avenue II, LLC, the Company owns and operates the EpiCentre, a mixed-use commercial development consisting of approximately 302,000 rentable square feet of office and retail/entertainment space, plus an underground parking deck, located at 210 E. Trade St. in the city block surrounded by the light rail line, Fourth Street, College Street, and Trade Street in uptown Charlotte, North Carolina. Pacific Avenue, LLC, filed for Chapter 11 bankruptcy protection on July 22, 2010 (Bankr. W.D. N.C. Case No. 10-32093). Joseph W. Grier, III, Esq., at Grier, Furr & Crisp, P.A., assists the Company in its restructuring effort. The Company estimated up to $50,000 in assets and $50 million to $100 million in debts in its bankruptcy petition. The Company's affiliate, Pacific Avenue II, filed a separate Chapter 11 petition. PACIFIC AVENUE: Taps James McElroy as Counsel in Regions Bank Case ------------------------------------------------------------------ Pacific Avenue, LLC, et al., ask for authorization from the Western District of North Carolina to employ James McElroy & Diehl, P.A., as the Debtors' counsel in the adversary proceeding pending between the Debtors and Regions Bank. JMD represented, prepetition, the Debtors in investigating and filing a complaint against Regions Bank. To the extent required, JMD will represent the Debtors in any matters in the Debtors' bankruptcy case that may be related to the Adversary Proceeding. The hourly rates of JMD's personnel are: Partners $225-$425 Associates $150-$215 Paraprofessionals $100 The primary attorneys and paralegals expected to represent the Debtors and their respective hourly rates are: Gary S. Hemric, Partner $400 Jared E. Gardner, Partner $350 Kristen E. Finlon, Associate $195 Jared E. Gardner, Esq., a member of JMD, assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Pacific Avenue, LLC, is a North Carolina limited liability company whose principal place of business is located in Charlotte, North Carolina. Together with Pacific Avenue II, LLC, the Company owns and operates the EpiCentre, a mixed-use commercial development consisting of approximately 302,000 rentable square feet of office and retail/entertainment space, plus an underground parking deck, located at 210 E. Trade St. in the city block surrounded by the light rail line, Fourth Street, College Street, and Trade Street in uptown Charlotte, North Carolina. Pacific Avenue, LLC, filed for Chapter 11 bankruptcy protection on July 22, 2010 (Bankr. W.D. N.C. Case No. 10-32093). Joseph W. Grier, III, Esq., at Grier, Furr & Crisp, P.A., assists the Company in its restructuring effort. The Company estimated up to $50,000 in assets and $50 million to $100 million in debts in its bankruptcy petition. The Company's affiliate, Pacific Avenue II, filed a separate Chapter 11 petition. POPULAR LIFE: AM Best Upgrades Issuer Credit Rating to "bb+" ------------------------------------------------------------ A.M. Best Co. has upgraded the issuer credit rating to "bb+" from "bb" and affirmed the financial strength rating of B (Fair) of Popular Life Re (San Juan, Puerto Rico). The outlook for both ratings has been revised to stable from negative. Popular Life Re is a life reinsurance subsidiary of Popular Inc., a publicly traded bank holding company based in Puerto Rico. The rating upgrade of the ICR reflects Popular Life Re's continued statutory operating earnings in recent years and the maintenance of solid capitalization ratios. While premium volume declined in recent years, reflecting the downturn in the Puerto Rican economy, the company's business volume has stabilized. In addition, A.M. Best believes premium volume will increase should the local economy continue to improve and loan origination activity increases. A.M. Best believes Popular Life Re is an important subsidiary, as it represents an extension of Popular Inc.'s well established insurance agency business, which operates under the brand Popular Insurance. Popular Life Re reinsures a portion of credit policies on consumer loans originated at Banco Popular de Puerto Rico, as well as personal accident and health policies underwritten by unaffiliated carriers. While A.M. Best believes the financial condition of Popular Life Re is secure, its ratings reflect the continued weak financial condition of Popular Inc., although some improvements in liquidity and capital are noted. The organization continues to work through loan delinquencies at each of its banks, and nonperforming assets are still increasing. Though losses have lessened, Popular Inc. has not yet regained profitability. A.M. Best expects that economic stresses experienced in Puerto Rico will pressure the pace of improvement over the near-to-intermediate term. PRECISION OPTICS: Investors Extend Note's Due Date to November 15 ----------------------------------------------------------------- Precision Optics Corporation Inc. on June 25, 2008, entered into a Purchase Agreement, as amended between Dec. 11, 2008, and September 15, 2010, with certain accredited investors pursuant to which it sold an aggregate of $600,000 of 10% Senior Secured Convertible Notes. On Oct. 15, 2010, the Investors amended the Notes to extend the "Stated Maturity Date" to November 15, 2010. The Company believes the Investors will continue to work with its Company to reach a positive outcome on the Note repayment. About Precision Optics Gardner, Mass.-based Precision Optics Corporation, Inc. (OTC BB: PEYE) -- http://www.poci.com/-- designs, develops, manufactures and sells specialized optical systems and components and optical thin-film coatings. The Company conducts business in one industry segment only and its customers are primarily domestic. The Company's products and services fall into two principal areas: (i) medical products for use by hospitals and physicians; and (ii) advanced optical system design and development services and products used by industrial customers. Going Concern Doubt Stowe & Degon LLC, in Westborough, Mass., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring net losses and negative cash flows from operations. The Company reported a net loss of $660,882 on $3.1 million of revenue for fiscal 2010, compared to a net loss of $992,135 on $3.5 million of revenue for fiscal 2009. The Company has sustained recurring net losses for several years. As of June 30, 2010, the Company has an accumulated deficit of $38.4 million. As of June 30, 2010, cash and cash equivalents were $416,040, accounts receivable were $505,200, and current liabilities were $2.1 million. The Company anticipates that deferred officers' salaries and director consulting expenses accrued at June 30, 2010, will be settled by issuing restricted common stock rather than by cash payments. These deferred amounts included in current liabilities at June 30, 2010, total roughly $574,000. The Company's balance sheet at June 30, 2010, showed $1.9 million in total assets, $2.1 million in total liabilities, and a stockholders' deficit of $164,249. QUALITY DISTRIBUTION: Moody's Keeps 'Caa1' Corp. Family Rating -------------------------------------------------------------- Moody's Investors Service changed the rating outlook of Quality Distribution LLC to positive from stable. All existing ratings, including the corporate family rating Caa1, have been affirmed. The positive rating outlook considers that better volumes, initially evidenced in the first half of 2010, could improve free cash flow generation from relatively low levels. Loads grew 4%, year-over-year, during the first six months of 2010 (9% during the second quarter of 2010). Increased working capital growth prevented flow-through of higher volumes to free cash but working capital should stabilize in the second half of 2010. Planned low capital spending and Quality's net operating loss tax shield further support the debt reduction potential. Material debt reduction in the second half of 2010 and expectation of a 5% free cash flow to debt ratio over the intermediate-term could trigger a ratings upgrade. (As of June 30, 2010 free cash flow to debt was about 1%.) The affirmed Caa1 corporate family rating continues to reflect high financial leverage, low asset coverage, and limited free cash flow against an adequate liquidity profile and Quality's strong position within its niche. While the rating encompasses that Quality's decreasing ownership of tractors / terminals and greater dependence on affiliates for these transport assets could limit future earnings declines, affiliates could also gain bargaining power, customer retention issues could more quickly develop in a stress scenario, and the need to financially support affiliates represents a potential liability. The affirmed ratings are: -- Corporate family and probability of default, Caa1 -- $16 million 9% subordinated notes due November 2010 Caa3, to LGD 6, 90% from LGD 5, 89% Moody's last rating action on Quality occurred October 22, 2009, when, following a limited default on the 9% subordinated notes due November 2010, the probability of default rating was changed to Caa1/LD from Caa3. (The LD designation was subsequently removed.) Quality's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Quality's core industry and Quality's ratings are believed to be comparable to those of other issuers of similar credit risk. Quality Distribution, LLC, and its parent holding company, Quality Distribution, Inc., are headquartered in Tampa, Florida. The company is a transporter of bulk liquid and dry bulk chemicals. The company's 2009 revenues were $614 million. Apollo Management, L.P., owns approximately 52% of the common stock of Quality Distribution, Inc. RADIENT PHARMACEUTICALS: Defaults Under 12% Convertible Notes ------------------------------------------------------------- Radient Pharmaceuticals Corporation said it incurred a Trigger Event on the 12% Convertible Notes issued in first and second quarter of 2010 due to its failure to have the related registration statement declared effective by June 1, 2010. The Company filed on Sept. 7, 2010, an Event of Default under those same notes occurred since it did not hold the related shareholder meeting by August 31, 2010. Once an Event of Default occurs, the note holders can declare the full amount of the note automatically due and payable. The Company submitted a letter requesting the note holders waive such default and give us until November 15, 2010 to hold the related shareholder meeting. Many of the note holders have already agreed to such waiver. However, as a reporting company, the Company required to report any events that accelerate or increase a direct financial obligation. Therefore, although the note holders waived the defaults and no other remedy is available pursuant to an additional default. The first interest payment, and an additional agreed upon installment payment, for the notes issued in the last three closings of the financings the Company completed in the first and second quarter of 2010 are due this month; the failure to make such payment constitutes an Event of Default. Under the terms of the Notes, this Event of Default causes a Trigger Event. However, under the terms of the Notes, only two Trigger Events shall be applied. Upon the occurrence of a Trigger Event, the outstanding balance of the Notes shall immediately increase to 125% of the then owing principal balance and interest shall accrue at the rate of 18% per annum thereafter. As previously disclosed, the Company increased the balance of the Notes and raised the interest to 18% on June 1, 2010; the Company also increased the principal balance of the Notes pursuant to the terms of the Waiver and expect the remaining note holders to sign the waiver so that they too can receive the additional raise in principal. The Company said, "We received additional comments from the SEC on October 7, 2010 and had discussions with the SEC reviewers handling our filings to further enhance our understanding of the comments to ensure complete and accurate responses thereto. As disclosed in the 8-K that we filed on October 5, 2010, we tentatively set November 15, 2010 as the new annual meeting date and October 13, 2010 as the related record date. We anticipate meeting these dates and finally being able to hold the shareholder meeting and obtain the shareholder approval we need." Headquartered in Tustin, Calif., Radient Pharmaceuticals Corporation -- http://www.Radient-Pharma.com/-- is engaged in the research, development, manufacturing, sale and marketing of its ONKO-SURE(TM) a proprietary IVD Cancer Test in the United States, Canada, China, Chile, Europe, India, Korea, Taiwan, Vietnam and other markets throughout the world. RICHARD GETTY: U.S. Trustee Unable to Appoint Creditors Committee ----------------------------------------------------------------- Virginia A. Burdette, the U.S. Trustee for Region 18, is unable to appoint members to the Official Committee of Unsecured Creditors in Richard K. Getty's Chapter 11 cases. Despite efforts to contact eligible unsecured creditors, the U.S. Trustee has not received a sufficient number of creditors willing to serve on a committee of unsecured creditors. Tacoma, Washington-based Richard K. Getty filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. W.D. Wash. Case No. 10-46061). James L. Day, Esq., Bush Strout & Kornfeld, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50 million to $100 million in its Chapter 11 petition. RICHARD MUNSON: Court Dismisses Credit Union Suit Over Land Rover ----------------------------------------------------------------- The Hon. Susan Pierson Sonderby dismissed the lawsuit Consumers Cooperative Credit Union, v. Richard J. Munson and Lida Downey a/k/a Lida Downey Munson, Adv. Proc. No. 10-A-00218 (Bankr. N.D. Ill.). In August 2005, the Munsons purchased a 2005 Land Rover. The purchase was financed through a $58,274 loan from the Credit Union. On September 17, 2009, the Credit Union filed suit in the Circuit Court of Cook County to recover the Land Rover and direct the Defendants to execute the appropriate application with the Illinois Secretary of State to have the Credit Union's lien perfected. On December 7, 2009, the state court entered a "Judgment in Detinue", stating, inter alia, that the Credit Union had established a right to possession of the Land Rover and ordering Debtors to return it to the Credit Union within fourteen days. The order further provided that the case was continued to January 11, 2010 "for status on the return of the collateral." According to the Credit Union, the Debtors failed to comply with the state court order. The Credit Union filed the adversary complaint to implement the state court order. The Credit Union requested an order determining that the debt owed to it by Debtors is nondischargeable under Sections 523(a)(2)(A) and (a)(6). The Court, however, noted that the Debtors paid -- subsequent to their August 2005 promise to perfect the Credit Union's lien -- over $47,900 (i.e., over 82%) of the $58,274.54 loaned by the Credit Union for the purchase of the Land Rover. While intent may be alleged generally, there is no allegation in the complaint of a present intention not to perform the promise to perfect the Credit Union's lien, and the facts alleged in the complaint do not plausibly suggest such an intent. Under the circumstances, the Credit Union has failed to state a plausible claim for relief under Section 523(a)(2)(A), the Court said. A copy of the Court's decision is available at: http://www.leagle.com/unsecure/page.htm?shortname=inbco20100917602 Richard J. Munson and Lida Downey, aka Lida Downey Munson, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 10-01559) on January 16, 2010. Gregory K. Stern, Esq., in Chicago, serves as bankruptcy counsel. The Munsons listed $1,287,775 in assets and $2,185,870 in debts in their petition. RITE AID: 401(k) Plan Blackout Period Starts November 15 -------------------------------------------------------- Rite Aid Corporation provided on October 15, 2010, a notice to its directors and executive officers informing them of a blackout period for The Rite Aid 401(k) Plan, the Rite Aid 401(k) Distribution Employees Savings Plan and the Rite Aid Services, L.L.C., 401(k) Plan, and the trading restrictions that apply to them during the blackout period. The blackout period is required to facilitate the elimination of the Rite Aid Company Stock Funds as an investment option under the 401(k) plans, and the liquidation of shares of Rite Aid company stock currently held in the Company Stock Funds, which liquidation was directed to be undertaken by the trustee of the Company Stock Funds for the 401(k) plans. The blackout period will begin on November 15, 2010 at 4:00 p.m. and will end on December 3, 2010 at 4:00 p.m. During the Blackout Period, participants in the 401(k) plans will be unable to direct or diversify investments in the Company Stock Funds, or obtain a distribution, including a hardship distribution or in-service withdrawal, from the portion of the participants' accounts invested in the Company Stock Funds. About Rite Aid Corp. Headquartered in Camp Hill, Pennsylvania, Rite Aid Corporation (NYSE: RAD) -- http://www.riteaid.com/-- is the largest drugstore chain on the East Coast and the third largest drugstore chain in the U.S. The Company operates more than 4,900 stores in 31 states and the District of Columbia. The Company's balance sheet at May 29, 2010, showed $8.0 billion in total assets, $9.7 billion in total liabilities, and $1.7 billion in stockholders' deficit. * * * Rite Aid carries 'Caa2' probability of default and corporate family ratings from Moody's Investors Service. It has a 'B-' corporate credit rating from Standard & Poor's Ratings Services. RIVER ROAD: Seeks to Appeal Ruling Favoring Credit Bidding ---------------------------------------------------------- Bankruptcy Law360 reports that River Road Hotel Partners LLC has sought approval to appeal a judge's order that denied the Company's request for Chapter 11 plan sale procedures that would have blocked lenders from credit bidding on assets. River Road filed a motion for certification of its appeal on Thursday in the U.S. Bankruptcy Court for the Northern District of Illinois, Law360 says. About River Road Hotel Partners River Road Hotel Partners, LLC, developed and manage the InterContinental Hotel Chicago O'Hare located in Rosemont, Illinois. Affiliate RadLAX Gateway Hotel LLC owns the Radisson hotel at Los Angeles International Airport. Both are ultimately controlled owned by Harp Group. River Road and its affiliates filed Chapter 11 in Chicago on August 17, 2009 (Bankr. N.D. Ill. Lead Case No. 09-30029). Based in Oak Brook, Illinois, River Road estimated assets of as much as $100 million and debt of as much as $500 million in its Chapter 11 petition. RadLAX and its affiliates filed a separate chapter 11 petition (Bankr. N.D. Ill. Case No 09-30047), estimating assets at $50 million to $100 million. David M. Neff, Esq., at Perkins Coie LLP, serves as counsel to the River Road and RadLAX debtors. The two cases, however, are not jointly administered. SABRA HEALTH: Moody's Assigns 'B2' Rating on Senior Unsec. Notes ---------------------------------------------------------------- Moody's Investors Service has assigned a B2 rating to the prospective senior unsecured notes offering of Sabra Health Care REIT, Inc. Moody's has also assigned a B2 corporate family rating to Sabra. The rating outlook is stable. This is the first time Moody's has rated Sabra. These ratings were assigned with a stable outlook: * Sabra Health Care REIT, Inc. -- corporate family rating at B2. * Sabra Health Care Limited Partnership -- prospective senior unsecured debt rating at B2. Ratings Rationale Sabra Health Care REIT's B2 corporate family and senior unsecured ratings reflect the REIT's small size, early stage of growth, and 100% tenant concentration with SHG Services, Inc. (corporate family rating of B1). SHG is a wholly-owned subsidiary of Sun Healthcare Group and will comprise the operating assets of Sun following the planned restructuring of the company. Sabra will own substantially all of Sun's owned real estate. Sabra's heavy concentration in skilled nursing facilities is also a key credit concern as this sector is heavily dependent on government reimbursements. Positively, Moody's notes that the REIT's portfolio is reasonably diversified across 19 states, which reduces its exposure to severe budget cuts from any one state. Following the separation from Sun (expected to occur in late 2010), Sabra is expected to be capitalized with modestly high overall and secured leverage levels. The REIT's liquidity is anticipated to consist of a new $100 million secured revolver and about $60 million cash and it will have negligible near-term debt maturities. Net proceeds from Sabra's planned $225 million senior unsecured notes offering due 2018 will be used, together with cash from Sun, to redeem Sun's existing 9.125% senior subordinated notes. Moody's notes that Sabra will have limited cushion on its interest coverage and unencumbered asset bond covenants until it achieves accretive growth. Positively, Moody's notes that Sabra's long-term triple net master leases with Sun are structured with solid EBITDAR coverage (1.6x), which should support stable cash flows. Furthermore, while Sabra is a new company that has yet to demonstrate a track record, the new management team is small, but highly seasoned with public company, healthcare and real estate experience. This experience should help the REIT as it looks to grow and diversify its portfolio by tenant, geography and property sub-type. The stable outlook reflects Sabra's predictable cash flow from its long term triple net leases and negligible debt maturities until 2013. These positives help to offset limited financial flexibility as the REIT looks to grow and diversify its asset base. Moody's indicated that a rating upgrade would be difficult in the short-term, but would likely reflect increased size (gross assets above $800M), reduced tenant concentration (largest tenant<80% of revenues), fixed charge coverage closer to 2.5x and effective leverage below 50% of gross assets. Negative rating pressure would likely result from sustained, substantial deterioration in EBITDAR coverage ratios, fixed charge coverage below 2.0x on a sustained basis, or material increases in secured debt, which could create subordination and pressure on the senior unsecured debt rating. This is the first time Moody's has rated Sabra Health Care REIT, Inc. Sabra Health Care REIT, Inc., a wholly owned subsidiary of Sun Healthcare Group, Inc., will own substantially all of Sun's currently owned real property assets and will lease those assets to Sun following the planned restructuring. The shares of Sabra common stock are expected to trade on the NASDAQ Global Select Market under the symbol "SBRA." Sabra intends to qualify and elect to be treated as a real estate investment trust for U.S. federal income tax purposes commencing with its taxable year beginning on January 1, 2011. SABRA HEALTH: S&P Assigns 'B' Corporate Credit Rating ----------------------------------------------------- Standard & Poor's Ratings Services assigned preliminary 'B' corporate credit ratings to Sabra Health Care REIT Inc., its operating partnership, Sabra Health Care L.P., and Sabra Capital Corp. Additionally, S&P assigned a preliminary 'B' rating and '3' recovery rating to Sabra's proposed $225 million senior unsecured notes. The preliminary '3' recovery rating indicates S&P's expectation for a meaningful (50%-70%) recovery for noteholders in the event of a payment default. (The preliminary ratings are subject to the completion of a separation transaction.) The outlook is stable. "S&P's 'B' rating on Sabra reflects the company's comparatively small health care portfolio relative to peers, significant tenant concentration, and modest room under its debt covenants," said credit analyst George Skoufis. "Sabra will be a newly formed entity with no historical track record operating as a public company. These factors offset Sabra's geographic diversity, long- term leases, and lack of debt maturities until 2013. S&P view the company's business risk profile as weak and the financial risk profile as aggressive." The outlook is stable. S&P expects cash flow to be stable based on the sound rent coverage and long-term nature of the leases, which should support current debt protection measures. S&P also assume that Sabra will pursue and fund growth in a leverage- neutral manner. S&P would lower its ratings on Sabra if the company were to aggressively pursue acquisitions, such that its derived FCC for the company declines from current levels or covenant pressures arise. While S&P views an upgrade as unlikely in the near term, S&P would consider raising the rating if Sabra can execute on its acquisition and diversification strategy while also building its covenant cushion and achieving an adequate liquidity profile. SEAGATE TECHNOLOGY: Fitch Puts 'BB+' Rating on Negative Watch ------------------------------------------------------------- Fitch Ratings has placed the ratings of Seagate Technology Public Limited Company and its wholly owned subsidiaries on Rating Watch Negative following the company's announcement that it hired legal and financial advisors to review a preliminary leveraged buyout offer and other strategic alternatives, both of which could potentially result in substantial increases in leverage. Approximately $2.2 billion of total debt is affected by Fitch's action. Fitch expects to resolve the Rating Watch Negative after Seagate concludes its review of the preliminary LBO offer and other strategic alternatives. Fitch notes that the indentures governing all of Seagate's outstanding debt include change of control provisions. Under the provisions, Seagate is required to offer to purchase all of the outstanding debt at 101% of par value plus accrued interest in the event a person acquires more than 50% of the company's voting stock, which results in a rating downgrade within 60 days of consummating the change of control. Lastly, Fitch has withdrawn the Issuer Default Rating of 'BB+' for Seagate Technology US Holdings since the entity redeemed all public debt. Fitch currently rates Seagate and its wholly owned subsidiaries: Seagate -- IDR 'BB+'. Seagate HDD Cayman -- IDR 'BB+'; -- Senior unsecured debt 'BB+'. Seagate Technology International -- IDR 'BB+'; -- Secured second lien notes 'BBB-'. SEAGATE TECHNOLOGY: Private Deal Won't Affect Moody's 'Ba1' Rating ------------------------------------------------------------------ In an 8-K filing, Seagate announced that it is in discussions with an unnamed party that has expressed preliminary interest regarding a potential going private transaction. Given that there is no guarantee that the company will receive and/or accept a formal offer regarding a transaction, the company's Ba1 CFR is not impacted. However, Moody's will continue to monitor the potential take-private developments, and to the extent Seagate were to announce a definitive transaction, the eventual outcome of the company's ratings would depend on the amount of additional debt that would be used to purchase the company. The last rating action was on April 29, 2010, when Moody's raised Seagate's CFR to Ba1 with a stable outlook. With headquarters in Scotts Valley, CA, and revenues of $11.4 billion for the fiscal year ended July 2, 2010, Seagate is a global leader in the design, manufacture and marketing of disk drive products used as the primary medium for storing electronic information in systems ranging from personal computers and consumer electronics to data centers. SEAGATE TECHNOLOGY: S&P Puts 'BB+' Rating on CreditWatch Negative ----------------------------------------------------------------- Standard & Poor's Ratings Services said it placed all its ratings on Seagate Technology and its subsidiaries, including the 'BB+' corporate credit rating, on CreditWatch with negative implications. Seagate's announcement that it is considering the indication of interest for a going-private transaction, and that the board is considering it as well as other strategic alternatives, increases the likelihood that some recapitalization event could occur, in S&P's opinion. "Given the early stage of the evaluation process, there is a wide range of outcomes with respect to a downgrade of the company," said Standard & Poor's credit analyst Lucy Patricola. "For example, a going-private transaction could result in S&P's lowering the corporate credit rating to the 'B' category. At the opposite end of the range, ratings would remain unchanged if the company's current capitalization does not change. Additionally, there is some capacity within the current rating for a modest increase in leverage should the company pursue a leveraging transaction to enhance shareholder value. Given the uncertainties with respect to the final capital structure, all issue-level ratings are on CreditWatch Negative. S&P will monitor developments as the company evaluates its strategic alternatives and will update the rating as necessary. In the event the company pursues a going-private transaction, S&P may lower the rating prior to final resolution. SEALY CORP: Marketing VP Acquires 73,062 Unrestricted Shares ------------------------------------------------------------ Jodi Allen, Sealy Corporation senior vice-president for Marketing, disclosed in a Form 4 filing with the Securities and Exchange Commission that on Oct. 14, 2010, the restrictions lapsed on 108,160 restricted shares of Sealy Corp. common stock. That lapse was settled with Ms. Allen receiving 73,062 unrestricted shares and surrendering 35,098 shares to Sealy Corp. for the payment of tax liabilities in connection with the lapse. Following the transaction, Ms. Allen may be deemed to directly hold 380,375 common shares. According to Ms. Allen's filing, the initial grant was for 400,000 restricted stock units with an annual growth rate of 8% until vested. The grant vests on an annual basis over 4 years. As a result of the 8% growth rate, if fully vested, will results in 488,535 shares of Sealy common stock. In a separate Form 4 filing, Sealy Corp. director John B. Replogle disclosed that on October 13, 2010, he acquired 18,000 restricted stock units. Each restricted stock unit represents a contingent right to receive one share of Sealy common stock. The grant is for 18,000 restricted stock units with 1/3 vesting on Oct. 13, 2011, 1/3 vesting on Oct. 13, 2012 and the final 1/3 vesting on Oct. 13, 2013. Sealy director Deborah G. Ellinger disclosed in a Form 3 filing that she doesn't hold any company securities. The number of shares of Sealy common stock outstanding as of September 21, 2010, was 97,494,390. About Sealy Corp. Trinity, North Carolina-based Sealy Corp. (NYSE: ZZ) -- http://www.sealy.com/-- is the largest bedding manufacturer in the world with sales of $1.5 billion in fiscal 2008. The Company manufactures and markets a broad range of mattresses and foundations under the Sealy(R), Sealy Posturepedic(R), including SpringFree(TM), PurEmbrace(TM) and TrueForm(R); Stearns & Foster(R), and Bassett(R) brands. Sealy operates 25 plants in North America, and has the largest market share and highest consumer awareness of any bedding brand on the continent. In the United States, Sealy sells its products to approximately 3,000 customers with more than 7,000 retail outlets. The Company's balance sheet at Aug. 29, 2010, showed $964.88 million in total assets, $206.78 million in total current liabilities, $749.66 million in long-term obligations, $58.00 million in other liabilities, $875,000 in deferred income tax liabilities, and a stockholders' deficit of $95.43 million. Sealy carries 'B' local and issuer credit ratings from Standard & Poor's. SEVERN BANCORP: Reports $485,000 net Profit in Third Quarter ------------------------------------------------------------ Severn Bancorp Inc. announced results for the quarter and nine months ended September 30, 2010. Net income for the third quarter was $485,000 compared to net loss of $4.4 million per share for the third quarter of 2009. Net income was $550,000 for the nine months ended September 30, 2010, compared to net loss of $12.6 million for the nine months ended September 30, 2009. At September 30, 2010, Severn's regulatory capital ratios continued to exceed the levels required to be considered "well capitalized" under applicable federal banking regulations, including its core ratio of approximately 12.1% compared to the regulatory requirement of 5% for "well capitalized" status. "While we are pleased to report a modest profit for the third quarter compared to last year's third quarter loss, it is clear that economic conditions remain challenging," said Alan J. Hyatt, president and chief executive officer. "Despite the disruptions in our industry and the overall economy we are continuing our strategy to provide full service banking to our customers." Mr. Hyatt continued "We are confident that we are the best choice for Anne Arundel County residents who are seeking a financial institution that provides sound banking products and excellent customer service, as well as a commitment to reinvest in our community." A full-text copy of the Company's earnings release is available for free at http://ResearchArchives.com/t/s?6c99 About Severn Savings Bank Founded in 1946, Severn Savings Bank, FSB -- http://www.severnbank.com/-- is a full-service community bank offering a wide array of personal and commercial banking products as well as residential and commercial mortgage lending. It has assets of nearly $1 billion and four branches located in Annapolis, Edgewater and Glen Burnie. The bank specializes in exceptional customer service and holds itself and its employees to a high standard of community contribution. Severn Bancorp, Inc., (Nasdaq: SVBI) is the parent company of Severn Savings Bank. As reported by the TCR on November 25, 2009, Annapolis, Maryland- based Severn Bancorp along with its Bank unit, has entered into supervisory agreements with the Office of Thrift Supervision, the Bank's primary federal regulator. The agreements set forth steps being taken in response to regulatory concerns with its operating results and effects of the current economic environment facing the financial services industry. SIMON WORLDWIDE: Panel Approves Dismissal of BDO USA as Accountant ------------------------------------------------------------------ Simon Worldwide Inc. said BDO USA LLP, formerly known as BDO Seidman LLP, was dismissed as the independent registered public accounting firm of Simon Worldwide Inc. The dismissal of BDO was approved by the Company's Audit Committee. The reports of BDO on the Company's financial statements as of and for the fiscal years ended December 31, 2009 and 2008 did not contain an adverse opinion or a disclaimer of opinion, and were not qualified or modified as to audit scope or accounting principle. With respect to qualifications as to uncertainty, the reports of BDO on the Company's financial statements as of and for the fiscal years ended December 31, 2009 and 2008 each noted that such financial statements had been prepared based on the assumption that the Company would continue as a going concern, that there is doubt about the Company's ability to continue as a going concern, and that such financial statements did not include any adjustments that might result from the outcome of this uncertainty. During the Company's fiscal years ended December 31, 2009 and 2008 and through October 8, 2010 there were no disagreements with BDO on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to the satisfaction of BDO would have caused them to make reference to the subject matter of the disagreement in connection with their reports on the financial statements for such years. During the Company's fiscal years ended December 31, 2009 and 2008 and through October 8, 2010 there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K. The Company's Audit Committee engaged Ernst & Young LLP as its new independent registered public accounting firm to audit the Company's financial statements for the Company's fiscal year ending December 31, 2010. The decision to engage Ernst & Young LLP as the Company's independent registered public accounting firm was the result of a competitive selection process. About Simon Worldwide Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) no longer has any operating business. Prior to August 2001, the Company operated as a multi-national full-service promotional marketing company, specializing in the design and development of high-impact promotional products and sales promotions. At December 31, 2009, the Company held an investment in Yucaipa AEC Associates, LLC, a limited liability company that is controlled by the Yucaipa Companies, a Los Angeles, California based investment firm. Yucaipa AEC in turn principally held an investment in the common stock of Source Interlink Companies, a direct-to-retail magazine distribution and fulfillment company in North America, and a provider of magazine information and front-end management services for retailers and a publisher of approximately 75 magazine titles. Yucaipa AEC held this investment in Source until April 28, 2009, when Source filed a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. BDO Seidman, LLP, in Los Angeles, following the Company's 2009 results, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of Company has suffered significant losses from operations, has a lack of any operating revenue and is subject to potential liquidation in connection with a recapitalization agreement. On June 11, 2008, the Company entered into an Exchange and Recapitalization Agreement with Overseas Toys, L.P., the former holder of all the outstanding shares of preferred stock of the Company, pursuant to which all the outstanding preferred stock would be converted into shares of common stock representing 70% of the shares of common stock outstanding immediately following the conversion. The Recapitalization Agreement was negotiated on the Company's behalf by the Special Committee of disinterested directors which, based in part upon the opinion of the Special Committee's financial advisor, determined that the transaction was fair to the holders of common stock from a financial point of view. In connection with the Recapitalization Agreement, and in the event that the Company does not consummate a business combination by the later of (i) December 31, 2010, or (ii) December 31, 2011, in the event that a letter of intent, an agreement in principle or a definitive agreement to complete a business combination was executed on or prior to December 31, 2010, but the business combination was not consummated prior to such time, and no qualified offer have been previously consummated, the officers of the Company will take all such action necessary to dissolve and liquidate the Company as soon as reasonably practicable. SIMON WORLDWIDE: Burkle's Overseas Toys Has $11-Mil. Buyout Offer ----------------------------------------------------------------- Overseas Toys, L.P., which is owned by Ronald Burkle's The Yucaipa Companies, on October 13 announced its intent to commence a Qualified Offer to acquire all of the outstanding shares of common stock of Simon Worldwide, Inc., par value $0.01 per share, not owned by Overseas Toys. In a letter to the members of the Board of Directors of Simon Worldwide, Robert P. Bermingham, its Secretary, said, "We believe that Simon's Liquidation Value is equal to $11,841,000 in the aggregate. . . . This aggregate Liquidation Value of $11,841,000 would result in a per share amount to be received by the shareholders upon liquidation of approximately $0.23 (based upon the 50,611,879 shares of Common Stock reported as being issued and outstanding as set forth in Simon's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 13, 2010). We are prepared, however, to offer $0.25 per share of Common Stock in our potential Qualified Offer." "We believe that the price of $0.25 per share proposed to be paid in our anticipated Qualified Offer is fair to the other shareholders of Simon, and represents a premium of approximately 7% over the amount per share we believe the shareholders would receive upon a liquidation of Simon. A per share offer price of $0.25 for the Common Stock would represent a premium of approximately 3% over the per share amount of total Company stockholders' equity as of June 30, 2010 as reported on the Most Recent 10-Q. It also represents premiums of approximately 6% and 4% over the closing price and the 50-day moving average closing price, respectively, of Simon's Common Stock as reported on the Pink Sheets on October 13, 2010. "We propose to make a Qualified Offer that is not subject to any financing or due diligence contingencies or to any other conditions other than those that are reasonable and customary for similar transactions; provided, that the Board and the Independent Directors approve our proposed Liquidation Value within the time period specified in the Recapitalization Agreement. The potential Qualified Offer will be subject to compliance with all applicable federal and state laws and regulatory requirements. "There can be no assurance that a Qualified Offer will be commenced by us or, if commenced, will be successfully consummated. The foregoing summarizes our current intentions only and should not be construed as an offer to purchase any shares of Common Stock. If there is mutual agreement as to the Liquidation Value and the other terms of a Qualified Offer, a Qualified Offer would only be commenced by means of a tender offer statement to the holders of Common Stock and our filing of a Schedule TO with the Securities and Exchange Commission. Until such time as a Qualified Offer commences (in which case we will be governed by the terms of our offer), we reserve whatever rights we currently may have to make or support other proposals, including, without limitation, liquidation of the Company or the declaration of an extraordinary dividend (either before or after a Qualified Offer is consummated)." As of October 13, Mr. Burkle may be deemed to beneficially own 37,940,756 shares or roughly 75.0% of Simon common stock. About Simon Worldwide Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) no longer has any operating business. Prior to August 2001, the Company operated as a multi-national full-service promotional marketing company, specializing in the design and development of high-impact promotional products and sales promotions. At June 30, 2010, the Company held an investment in Yucaipa AEC Associates, LLC, a limited liability company that is controlled by the Yucaipa Companies, a Los Angeles, California based investment firm. Yucaipa AEC in turn principally held an investment in the common stock of Source Interlink Companies, a direct-to-retail magazine distribution and fulfillment company in North America, and a provider of magazine information and front-end management services for retailers and a publisher of approximately 75 magazine titles. Yucaipa AEC held this investment in Source until April 28, 2009, when Source filed a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. BDO Seidman, LLP, in Los Angeles, following the Company's 2009 results, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of Company has suffered significant losses from operations, has a lack of any operating revenue and is subject to potential liquidation in connection with a recapitalization agreement. On June 11, 2008, the Company entered into an Exchange and Recapitalization Agreement with Overseas Toys, L.P., the former holder of all the outstanding shares of preferred stock of the Company, pursuant to which all the outstanding preferred stock would be converted into shares of common stock representing 70% of the shares of common stock outstanding immediately following the conversion. The Recapitalization Agreement was negotiated on the Company's behalf by the Special Committee of disinterested directors which, based in part upon the opinion of the Special Committee's financial advisor, determined that the transaction was fair to the holders of common stock from a financial point of view. In connection with the Recapitalization Agreement, and in the event that the Company does not consummate a business combination by the later of (i) December 31, 2010, or (ii) December 31, 2011, in the event that a letter of intent, an agreement in principle or a definitive agreement to complete a business combination was executed on or prior to December 31, 2010, but the business combination was not consummated prior to such time, and no qualified offer have been previously consummated, the officers of the Company will take all such action necessary to dissolve and liquidate the Company as soon as reasonably practicable. The Company's balance sheet at June 30, 2010, showed $13,098,000 in total assets, $808,000 in total current liabilities, and $12,290,000 stockholders' equity. SMART-TEK SOLUTIONS: J. Kinross-Kennedy Raises Going Concern Doubt ------------------------------------------------------------------ Smart-Tek Solutions Inc. filed on October 15, 2010, its annual report on Form 10-K for the fiscal year ended June 30, 2010. John Kinross-Kennedy, of Irvine, California, expressed substantial doubt about the Company's ability to continue as a going concern. Mr. Kinross-Kennedy noted that that the Company has suffered recurring losses until the latest fiscal year, and has a working capital deficiency of $994,278 and a stockholders' deficiency of $438,164 at June 30, 2010. The Company reported net income of $203,080 on $12.0 million of revenue for fiscal 2010, compared to a net loss of $136,367 on $3.2 million of revenue for fiscal 2009. The net income consists of $490,340 in income from the new Smart-Tek Automated Services subsidiary, offset by a loss of $157,228 from the Smart-Tek Communications Inc. subsidiary plus corporate charges of $130,032. The Company's balance sheet at June 30, 2010, showed $3.7 million in total assets, $4.1 million in total liabilities, and a stockholders' deficit of $438,164. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6ca3 About Smart-tek Solutions Newport Beach, Calif.-based Smart-tek Solutions Inc. has two business lines. Through its wholly owned subsidiary Smart-Tek Communications Inc. the Company specializes in the design and development of Radio Frequency Identification (RFID) integration, monitoring and tracking solutions to meet industry demands. Through its wholly owned subsidiary Smart-Tek Automated Services Inc. the Company provides professional employer organization services. SOUTH BAY: Asks for Plan Filing Exclusivity Until Feb. 15 --------------------------------------------------------- South Bay Expressway, L.P., and California Transportation Ventures, Inc., as debtors and debtors-in-possession, ask Judge Louise D. Adler, United States bankruptcy judge for the Southern District of California, to extend for 90 days (i) their exclusive period to file a plan of reorganization through and including February 15, 2011, and (ii) their exclusive period to solicit votes for a plan through and including April 16, 2011, without prejudice to the Debtors' right to request further extensions. The Debtors' current Exclusive Plan Proposal Period expires on November 17, 2010, and their Exclusive Solicitation Period expires on January 16, 2011. The Debtors request a further extension of their Exclusive Periods to permit resolution of the long-standing priority dispute -- the Mechanics Lien Dispute -- between their secured lenders and Otay River Constructors and InTrans Group, Inc. The Debtors believe that this is a "gating issue" to confirmation of a plan of reorganization, according to R. Alexander Pilmer, Esq., at Kirkland & Ellis LLP, in Los Angeles, California. Mr. Pilmer relates that since the Petition Date, the Debtors have worked diligently toward their goal of an efficient and consensual balance sheet restructuring. Initially, the Debtors focused on stabilizing their operations, including seeking and receiving authority to continue using cash collateral and to pay prepetition claims for wages and benefits, taxes, customer programs, insurance and utilities, he continues. More recently, the Debtors have focused on the Mechanics Lien Dispute. The Debtors filed their adversary proceeding shortly after the Petition Date; established a discovery schedule with the other parties to the litigation; moved for summary judgment on a potentially dispositive issue of law; and when that motion was denied, implemented a negotiated discovery and trial schedule with the aim of an expeditious resolution of the Mechanics Lien Dispute. The extensive preparation for trial has consumed a significant amount of the Debtors' time, Mr. Pilmer says. The Debtors and their advisors have also been actively analyzing the Debtors' business along with projections of future traffic flows and housing development to assess all potential restructuring alternatives and develop parameters for a feasible post-emergence capital structure, Mr. Pilmer informs the Court. The Debtors believe they will be well positioned to finalize a plan of reorganization and prepare a disclosure statement once the Mechanics Lien Dispute is resolved, whether by Court or by settlement among the parties. Moreover, the Debtors note that they and their advisors have been analyzing potential restructuring alternatives and are working with the parties that they believe hold the fulcrum security. Mr. Pilmer adds that the Debtors have also been entertaining unsolicited requests for information from third parties interested as potential plan sponsors or purchasers of assets. The Debtors, with the assistance of their advisors, will continue to assess all possible restructuring alternatives and will work with their stakeholders as they deem appropriate to develop a consensual plan of reorganization as expeditiously as possible, he assures the Court. Mr. Pilmer asserts that an extension of the Exclusive Periods is appropriate under the circumstances. He points out that, absent an extension, the Exclusive Periods will expire before the Mechanics Lien Dispute is resolved and before the Debtors have had a meaningful opportunity to develop a consensual plan of reorganization, which would present a risk of undue interference and disruption to the plan formulation and negotiation process. The motion is scheduled to be heard on November 4, 2010. About South Bay Expressway South Bay Expressway, L.P., dba San Diego Expressway, L.P., filed for Chapter 11 on March 22, 2010 (Bankr. S.D. Calif. Case No. 10-04516). Its affiliate, California Transportation Ventures Inc., also filed for bankruptcy. The Debtors developed and operate a four lane, nine mile express toll road in Southern California commonly referred to as the South Bay Expressway or State Road 125. Both estimated assets and debts of $500 million to $1 billion in their bankruptcy petitions. Robert Pilmer, Esq., at Kirkland & Ellis LLP, represents the Debtors in their restructuring effort. PricewaterhouseCoopers LLP is auditor and tax advisor. Imperial Capital LLC is financial advisor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The Debtors say that as of the bankruptcy filing, they have roughly $640 million in book value of total assets and roughly $570 million in book value of total liabilities. SOUTH BAY: Removal Period Extended Until February 15 ---------------------------------------------------- The U.S. Bankruptcy Court entered its written order on September 29, 2010, granting South Bay Expressway L.P.'s request to extend the period during which they may remove civil actions by 120 days, to no earlier than February 15, 2011. About South Bay Expressway South Bay Expressway, L.P., dba San Diego Expressway, L.P., filed for Chapter 11 on March 22, 2010 (Bankr. S.D. Calif. Case No. 10-04516). Its affiliate, California Transportation Ventures Inc., also filed for bankruptcy. The Debtors developed and operate a four lane, nine mile express toll road in Southern California commonly referred to as the South Bay Expressway or State Road 125. Both estimated assets and debts of $500 million to $1 billion in their bankruptcy petitions. Robert Pilmer, Esq., at Kirkland & Ellis LLP, represents the Debtors in their restructuring effort. PricewaterhouseCoopers LLP is auditor and tax advisor. Imperial Capital LLC is financial advisor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The Debtors say that as of the bankruptcy filing, they have roughly $640 million in book value of total assets and roughly $570 million in book value of total liabilities. SOUTH BAY: SANDAG Contemplates Take Over ---------------------------------------- South Bay Expressway CEO Greg Hulsizer said the toll road could be sold within the next year as several groups have come forward with thoughts of purchasing the 10-mile road, including the San Diego Association of Governments, reports 10News. "[W]e've been approached by several private sector companies who've shown an interest," Mr. Hulsizer said, notes the report. Robert J. Hawkins of the San Diego Union Tribune said the board of directors of SANDAG had a closed session last October 8, 2010, to consider negotiating for the 35-year state lease under which South Bay Expressway Ltd. operates the 10-mile toll road in South County. Prior to the session, SANDAG executive director Gary Gallegos had confirmed that he will ask for the board's blessing to explore a bid for the roadway, added Mr. Hawkins. "It" is the 35-year franchise lease under which South Bay Express Ltd. operates the extension of state Route 125 from Sweetwater Valley to the border with Mexico. "That's the real asset," said Mr. Gallegos. The lease extends to 2042 and has 32 years of life left, he pointed out. But neither SANDAG nor South Bay has initiated any discussion on a sale, clarified Mr. Gallegos, according to the report. If SANDAG does go after the toll road, it would use a combination of TransNet sales tax revenue, as well as state and federal funds, the report added. In response, Mr. Hulsizer said he would "welcome the interest from SANDAG in the same manner that we are welcoming interest from other parties" and that he would refer SANDAG to the company's financial representative Imperial Capital. About South Bay Expressway South Bay Expressway, L.P., dba San Diego Expressway, L.P., filed for Chapter 11 on March 22, 2010 (Bankr. S.D. Calif. Case No. 10-04516). Its affiliate, California Transportation Ventures Inc., also filed for bankruptcy. The Debtors developed and operate a four lane, nine mile express toll road in Southern California commonly referred to as the South Bay Expressway or State Road 125. Both estimated assets and debts of $500 million to $1 billion in their bankruptcy petitions. Robert Pilmer, Esq., at Kirkland & Ellis LLP, represents the Debtors in their restructuring effort. PricewaterhouseCoopers LLP is auditor and tax advisor. Imperial Capital LLC is financial advisor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The Debtors say that as of the bankruptcy filing, they have roughly $640 million in book value of total assets and roughly $570 million in book value of total liabilities. SPARKLEBERRY EB: To Pay Creditors from Sale of Land --------------------------------------------------- Sparkleberry EB, LLC, submitted to the U.S. Bankruptcy Court for the Southern District of Texas a combined Plan of Reorganization and Disclosure Statement. The Debtor will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. Sparkleberry owns approximately 15 acres of raw land on East Beach in Galveston, Texas. According to the Disclosure Statement, the Plan envisions the sale of the sole asset of Sparkleberry through an auction process. Whitney Bank, N.A., is a qualified bidder for the auction and may submit a credit bid up to the amount of its secured claim. The sale pursuant to the auction would close in a title company. The title company would pay all secured claims of the Debtor because they would be an encumbrance on the property that was being sold. However, any proceeds of the sale that remains after payment of all secured claims and all costs of sale would be remitted to Sparkleberry. Sparkleberry, in turn, would pay the claims of the unsecured class and the member. Under the Plan, the Debtor will pay Whitney Bank or its successors and assigns, in full from the proceeds of the auction. The Debtor will pay the unsecured debt from the auction proceeds only after payment in full of all secured claims and costs of the sale. The remaining class are the members of the Sparkleberry will retain their ownership of the company and enjoy a return for their investment only if funds exist after full satisfaction of the debt to creditors. A full-text copy of the Plan and Disclosure Statement is available for free at http://bankrupt.com/misc/Sparkleberry_DS.pdf About Sparkleberry EB, LLC Houston, Texas-based Sparkleberry EB, LLC, is a limited liability company organized under the laws of the State of Texas for the purpose of development land on Galveston East Beach. The Company filed for Chapter 11 bankruptcy protection on July 5, 2010 (Bankr. S.D. Tex. Case No. 10-80395). Barbara Mincey Rogers, Esq., at Rogers & Anderson, PLLC, assists the Debtor in its restructuring effort. The Company disclosed $32,000,601 in assets and $3,545,374 in liabilities. SPARKLEBERRY EB: To Justify Reorganization Case on October 21 ------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas directed Sparkleberry EB, LLC, and its counsel to appear before the Court on October 21, 2010, at 10:00 a.m. to show cause why the Chapter 11 case must not be dismissed. Houston, Texas-based Sparkleberry EB, LLC, filed for Chapter 11 bankruptcy protection on July 5, 2010 (Bankr. S.D. Tex. Case No. 10-80395). Barbara Mincey Rogers, Esq., at Rogers & Anderson, PLLC, assists the Debtor in its restructuring effort. The Company disclosed $32,000,601 in assets and $3,545,374 in liabilities. SPHERIS INC: CoMetrics Named Fin'l Advisor for SP Wind Down ----------------------------------------------------------- The United States Bankruptcy Court for the District of Delaware has approved the retention of CoMetrics Partners LLC as Financial Advisors and Walter Jones as Liquidating Trustee for SP Wind Down, formerly Spheris Inc. Spheris Inc, which had been a transcriber of medical dictation for doctors and hospitals, has an approved Chapter 11 plan in which unsecured creditors and holders of senior subordinated notes were told in the disclosure statement that they should expect recovery of approximately 23 cents on the dollar. CoMetrics Partners LLC had been acting as the financial advisor to the Committee, and Walter Jones, Managing Director of the CoMetrics Profit Maximization/Turnaround Division as Liquidating Trustee responsible for distributing the company proceeds and other remaining assets. Mr. Jones has extensive experience in Chapter 11 restructuring and has been directly responsible for advising debtors and the creditors' committee with respect to marshalling and distributing estate assets, reconciling liabilities and maximizing timely distributions to creditors. "We are pleased the Official Committee has selected and the court approved CoMetrics Partners to act as its Financial Advisor and Liquidating Trustee," said Gary D. Herwitz, Managing Partner of CoMetrics. About CoMetrics Partners CoMetrics Partners LLC was founded in 2005 by Managing Partner Gary D. Herwitz. The firm specializes in providing middle market companies with strategic vision and leadership to integrate operations, technology and finance. The firm's services include consulting and corporate finance, profit improvement and turn around services as well a proprietary supply chain management solution for middle market importers. Headquartered in Franklin, Tennessee, Spheris Inc. -- http://www.spheris.com/-- is a global provider of clinical documentation technology and services. Spheris Inc., along with five affiliates, filed for Chapter 11 on Feb. 3, 2010 (Bankr. D. Del. Case No. 10-10352). Attorneys at Young Conaway Stargatt & Taylor, LLP, and Willkie Farr & Gallagher LLP represent the Debtors in their Chapter 11 effort. Jefferies & Company serves as financial advisors to the Debtors. Attorneys at Schulte Roth & Zabel LLP and Landis Rath & Cobb LLP serve as counsel to the prepetition and DIP lenders. Garden City Group Inc. is claims and notice agent. The petition says that assets range from $50 million to $100 million while debts range from $100 million to $500 million. The estate of Spheris Inc. is now formally named SP Wind Down Inc. after it sold the business in April. CBay Inc.'s MedQuist Inc. purchased the domestic business of Spheris for $98.8 million. TBP CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: TBP Construction, Inc. 506 West Dee Drive Garden City, UT 84028 Bankruptcy Case No.: 10-33874 Chapter 11 Petition Date: October 7, 2010 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: Joel T. Marker Debtor's Counsel: D. Rand Henderson, Esq. HENDERSON LAW OFFICES P.O. Box 594 Logan, UT 84323-0594 Tel: (435) 713-0660 Fax: (435) 792-3836 E-mail: bkecf0904@hendersonlaw.org Estimated Assets: $1,000,001 to $10,000,000 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/utb10-33874.pdf The petition was signed by Troy Petersen, president. TEL-INSTRUMENT: NYSE Amex Accepts Continued Listing --------------------------------------------------- Tel-Instrument Electronics Corp. announced October 18 that the NYSE Amex accepted its proposed plan to return to compliance with the minimum stockholder equity requirement by January 30, 2012. As previously reported, the Company was not in compliance with the Exchange's requirement for continued listing of its shares under Section 1003(a)(ii) of the Exchange's rules as its stockholders' equity at March 31, 2010 was $3.85 million as compared to the $4.0 million minimum requirement. Based upon the information provided by the Company, the Exchange has determined that the Company has made a reasonable demonstration of its ability to regain compliance with Section 1009 of the Company Guide by January 30, 2012. Based on this, the Exchange will continue the listing of the Company. The Exchange will periodically review the Company's financial results for compliance with the Plan. If the Company does not show progress consistent with the Plan, the Exchange Staff will review the circumstances and could commence delisting proceedings. The Company is confident that it will achieve its objectives and maintain its listing on the NYSE Amex. Pursuant to Exchange rules, the Company's stock continues to be listed for trading. TELETOUCH COMMUNICATIONS: Posts $230,000 Net Loss in Aug. 31 Qtr. ----------------------------------------------------------------- Teletouch Communications Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $230,000 on $8.98 million of total operating revenues for the three months ended Aug. 31, 2010, compared with a break-even on $11.45 million of total operating revenues for the same period a year ago. The Company's balance sheet at Aug. 31, 2010, showed $20.33 million of total assets, $28.94 million of total liabilities, and a stockholders' deficit of $8.61 million. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?6c9f Teletouch Communications, Inc., offers a comprehensive suite of wireless telecommunications solutions, including cellular, two-way radio, GPS-telemetry and wireless messaging. Teletouch is an authorized provider of AT&T (NYSE: T) products and services (voice, data and entertainment) to consumers, businesses and government agencies, as well as an operator of its own two-way radio network in Texas. Recently, Teletouch entered into national agency and distribution agreements with Sprint (NYSE: S) and Clearwire (NASDAQ: CLWR), providers of advanced 4G cellular network services. Teletouch operates a chain of 26 retail and agent stores under the "Teletouch" and "Hawk Electronics" brands, in conjunction with its direct sales force, customer care (call) centers and various retail eCommerce Web sites including: http://www.hawkelectronics.com/and http://www.hawkexpress.com/ Through its wholly-owned subsidiary, Progressive Concepts, Inc., Teletouch operates a national distribution business, PCI Wholesale, primarily serving large cellular carrier agents and rural carriers, as well as auto dealers and smaller consumer electronics retailers, with product sales and support available through http://www.pciwholesale.com/and http://www.pcidropship.com/among other B2B oriented Web sites. THOMPSON PUBLISHING: Bids Due By Nov. 12; Sale Hearing on Nov. 19 ----------------------------------------------------------------- The Honorable Peter J. Walsh approved uniform bidding procedures for the sale of Thompson Publishing Holding Co.'s assets at a hearing on Oct. 13, 2010. Bids topping the Debtors' First Lien Lenders' $42 million credit bid must be presented to the Debtors by 4:30 p.m. on Nov. 12, 2010. In the event any higher and better offers are received by the Debtors, an auction will be held at 10:00 a.m. on Nov. 17, 2010. The Debtors will ask Judge Walsh to approve a sale of substantially all of the estates' assets to the highest and best bidder at a Sale Hearing at 9:30 a.m. on Nov. 19, 2010. Legal publisher Thompson Publishing Holding Co. Inc. and six affiliates sought chapter 11 protection (Bankr. D. Del. Case No. 10-13070) on Sept. 21, 2010. Thompson is majority owned by Avista Capital Partners, which bought a 50% stake in the company for $130 million in 2006. Thompson estimated assets of $10 million to $50 million and debts of $100 million to $500 million in its Chapter 11 petition. John F. Ventola, Esq. -- jventola@choate.com -- and Lisa E. Herrington, Esq. -- lherrington@choate.com -- at Chote, Hall & Stewart LLP in Boston, Mass., and Alissa T. Gazze, Esq., Chad A. Fights, Esq., and Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell, LLP, provide the Debtors with legal counsel, and Mark Chesen and Michael Gorman at SSG Capital Advisors LLC in Conshohocken, Pa., provide the Debtors with financial advisory services. THORNBURG MORTGAGE: Orrick, Ex-Execs Fail to Stop Fraud Suit ------------------------------------------------------------ Bankruptcy Law360 reports that a federal judge has kept alive a trustee's claims of legal malpractice against an Orrick Herrington & Sutcliffe LLP partner, as well as some claims of corporate malfeasance against former executives of Thornburg Mortgage Inc., who allegedly conspired to siphon assets from the bankrupt lender to start a new business. Judge Richard D. Bennett of the U.S. District Court for the District of Maryland handed a partial victory to court-appointed trustee Joel I. Sher on Thursday, Law360 says. About Thornburg Mortgage Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA) -- http://www.thornburgmortgage.com/-- was a single-family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable rate mortgages. It originated, acquired, and retained investments in adjustable and variable rate mortgage assets. Its ARM assets comprised of purchased ARM assets and ARM loans, including traditional ARM assets and hybrid ARM assets. Thornburg Mortgage and its four affiliates filed for Chapter 11 on May 1, 2009 (Bankr. D. Md. Lead Case No. 09-17787). Thornburg changed its name to TMST, Inc. Judge Duncan W. Keir is handling the case. David E. Rice, Esq., at Venable LLP, in Baltimore, Maryland, is tapped as counsel. Orrick, Herrington & Sutcliffe LLP is employed as special counsel. Jim Murray, and David Hilty, at Houlihan Lokey Howard & Zukin Capital, Inc., are tapped as investment banker and financial advisor. Protiviti Inc. is also engaged for financial advisory services. KPMG LLP is the tax consultant. Epiq Systems, Inc., is claims and noticing agent. Thornburg listed total assets of $24.4 billion and total debts of $24.7 billion, as of January 31, 2009. On October 28, 2009, the Court approved the appointment of Joel I. Sher as the Chapter 11 Trustee for the Company, TMST Acquisition Subsidiary, Inc., TMST Home Loans, Inc., and TMST Hedging Strategies, Inc. TIGRENT INC: Strudwick et al. Extend Forbearance Until Feb. 2011 ---------------------------------------------------------------- Tigrent Inc. agreed on October 7, 2010, to a further forbearance with M. Barry Strudwick, Susan Weiss and certain other parties with respect to a settlement memorandum providing for settlement and release of certain claims with respect to its litigation relating to Monterey del Mar, S.A., a Panamanian company and other matters. Under the terms of the Settlement Memorandum, the Company agreed to pay Mr. Strudwick and Ms. Weiss a total of $3.8 million -- $1.2 million of which was paid in 2009. The Company issued two promissory notes for the remaining $2.6 million, one for $2.3 million and the other for $300,000. The Company has missed payments of approximately $220,337 and $5,983 with respect to the First Note and Second Note, respectively, that were due July 15, 2010. The Company and the holders of the Notes first entered into a forbearance on July 30, 2010, which forbearance expired on August 13, 2010. Since the expiration of the Company's last forbearance, the Company and the holders of the Notes have continued to consider and discuss plans regarding continued forbearance, future payments and transfer of collateral. Under the terms of the Additional Forbearance, the holders of the Notes agreed to forbear from enforcing their rights and remedies under the Notes and the Settlement Memorandum for a period ending February 15, 2011. In consideration for the Additional Forbearance, the Company has agreed to execute a quitclaim deed transferring Tranquility Bay, undeveloped real property located in Lee County, Florida, to the holders of the Notes. Upon recording of the Deed, $300,000 will be credited toward the amounts due and coming due under the Notes. About Tigrent Inc. Cape Coral, Fla.-based Tigrent Inc. (OTC BB: TIGE) -- http://www.tigrent.com/-- is a provider of practical, high- quality and value-based training, conferences, publications, technology-based tools and mentoring to help customers become financially literate. The Company provides customers with comprehensive instruction and mentoring in the topics of real estate and financial instruments investing and entrepreneurship in the United States, the United Kingdom, and Canada. The Company's balance sheet as of June 30, 2010, showed $43.8 million in total assets, $80.7 million in total liabilities, and a stockholders' deficit of $36.9 million. In its Form 10-Q report for the quarter ended June 30, 2010, the Company said it continues to incur a negative cash flow -- totaling $5.9 million for the period ending June 30, 2010 -- due to the on-going challenges with sales of products. "We have insufficient working capital to meet operating needs, raising substantial doubt about the ability of the Company to continue as a going concern," the Company said. In addition to the shift in strategic emphasis from live course offerings to digitally-delivered programs, the Company said it continues to implement reductions in staff to align with anticipated sales level, decreased occupancy costs, and reduced operating costs in all areas. The Company is also in current discussions with some of larger creditors to negotiate amounts owed. The Company said it if cannot generate the required revenues to sustain operations or obtain additional capital on acceptable terms, it will need to substantially revise its business plan, file for bankruptcy, sell assets or cease operations and investors could suffer the loss of a significant portion or all of their investment in the Company. TIX CORP: Echo Lake Opposes Plan to Delist Shares ------------------------------------------------- Ephraim Fields of Echo Lake Capital he had sent a letter to the Board of Directors of Tix Corp. In the letter, Mr. Fields expressed his belief that the plan to delist and deregister the company's stock was not in the best interest of shareholders and had resulted in the further destruction of shareholder value. Mr. Fields also noted that the board was attempting to enact the Proposal without the approval of the company's shareholders. As a result, Mr. Fields called on TIXC's board to publicly release all the materials, analyses, reports, studies, etc. used by the board in evaluating whether the Proposal would benefit shareholders. TODD'S INTERTHERM: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Todd's Intertherm, Inc. dba Todd's Heating and Cooling 200 E 33rd St Garden City, ID 83714 Bankruptcy Case No.: 10-03293 Chapter 11 Petition Date: October 7, 2010 Court: United States Bankruptcy Court District of Idaho (Boise) Judge: Jim D. Pappas Debtor's Counsel: Matthew Todd Christensen, Esq. ANGSTMAN, JOHNSON & ASSOCIATES, PLLC 3649 N. Lakeharbor Lane Boise, ID 83703 Tel: (208) 384-8588 Fax: (208) 853-0117 E-mail: mtc@angstman.com Scheduled Assets: $145,634 Scheduled Debts: $1,108,117 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/idb10-03293.pdf The petition was signed by Michael Murphy Sweet, president. TRIBUNE CO: Arkin Kaplan, et al., Represent Step One Lenders ------------------------------------------------------------ In a joint verified statement pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure, Arkin Kaplan Rice, LLP; Olshan Grundman Frome Rosenzweig & Wolosky LLP; and Morris, Nichols, Arsht & Tunnell LLP, disclosed that they represent a number of individual creditors in connection with their holdings of Step One indebtedness governed by the Credit Agreement, dated as of May 17, 2007, by an among Tribune, each lender from time to time a party thereto, and certain financial institutions and administrative agent, syndication agent, co-documentation agents, and joint lead arrangers and joint bookrunners. The names and addresses of the individual creditors are available for free at http://bankrupt.com/misc/Tribune_Arkinetal.pdf According to the firms, the aggregate amount of Step One claims held by the Step One Credit Agreement Lenders against the Debtors currently totals approximately $767,748,214. The firms assure the Court that they do not represent the Step One Credit Agreement Lenders as a committee and do not undertake to represent the interests of any creditor, party-in-interest, or other entity that has not signed a retention agreement with them. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Names Jerry Core VP/GM for KTXL-TV ---------------------------------------------- Tribune Broadcasting announced that Jerry Del Core will join the company as vice president/general manager of KTXL-TV in Sacramento. Del Core brings more than 20 years of diverse management experience to the station. "I'm delighted to have Jerry join our west coast team," said Ray Schonbak, executive vice president for Tribune Broadcasting. "With his robust experience, proven sales and marketing record, consistency in delivering results and motivating staff, he's the right choice to take KTXL to new heights." Prior to joining Tribune, Del Core was most recently chief operating officer and market manager/Sacramento for Adelante Media Group (formerly Bustos Media). He has held numerous leadership posts in broadcasting, and from 2007 to 2010, served as vice president and market manager for Border Media, where he launched three media properties from Spanish to general market. "I'm very excited to join Jerry Kersting, Ray Schonbak and the Tribune team at Fox 40 in Sacramento," said Del Core. "This is a great station with a great staff that has continued to perform. Together, we'll take the necessary steps to continue growing viewership, ratings, results and profitability." Notably, throughout his career, Del Core served as adjunct professor in mass communications at Norfolk State University, Norfolk, Virginia and Curry College, Milton, Massachusetts. Del Core will join KTXL-TV on Oct. 25. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRUST NO. 3645: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: Trust No. 3645 aka Pebble Creek 3959 E. Thousand Oaks Boulevard Thousand Oaks, CA 91362 Bankruptcy Case No.: 10-32880 Involuntary Chapter 11 Petition Date: October 13, 2010 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: Eileen W. Hollowell Petitioners' Counsel: Alan R. Solot, Esq. TILTON & SOLOT 459 N. Granada Avenue Tucson, AZ 85701 Tel: (520) 622-4622 Fax: (520) 882-9861 E-mail: arsolot@tiltonandsolot.com Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Coffee Builders, Inc. Unpaid Invoices $1,519,079 7049 E. Tanque Verde, Suite 105 Tucson, AZ 85715 CIS Roofing, Inc. Unpaid Invoices $162,771 26861 Trabuco, Suite 353 Mission Viejo, CA 92691 Door Pac, LLC Unpaid Invoices $16,052 2201 E. Elvira, Road Tucson, AZ 85756-7026 Horizon Contracting, LLC Unpaid Invoice $12,225 510 S. 52nd Street, Suite 101 Tempe, AZ 85281 TURKPOWER CORP: Posts $429,300 Net Loss in August 31 Quarter ------------------------------------------------------------ TurkPower Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $429,312 on $25,922 for the three months ended August 31, 2010, compared with a net loss of $500 on $0 revenue for the same period ended August 31, 2009. The increase in revenues was due to the commencement of the Company's operations in Turkey. The Company had a working capital deficit as of August 31, 2010, of $1.97 million. The Company's balance sheet at August 31, 2010, showed $2.38 million in total assets, $2.37 million in total liabilties, and stockholders' equity of $13,071. As reported in the Troubled Company Reporter on October 7, 2010, MaloneBailey LLP, in Houston, Tex., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended May 31, 2010. The independent auditors noted that the Company has incurred losses from operations and has a working capital deficit as of May 31, 2010. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6c9b About TurkPower Corporation New York-based TurkPower Corporation was incorporated on November 4, 2004m in Delaware. On May 11, 2010, Global Ink Supply Co. changed its name to TurkPower Corporation. On December 23, 2009, the Company entered into the consulting and service operations business, offering domestic and international clients consulting services. The Company acts as a full-service operator for wind, hydro, solar, and geothermal energy parks in Turkey. The Company also generates revenue by entering into agreements with other entities to provide consulting services to clients in the energy market. TWIN CITY: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: Twin City Hospital 819 North First Street Dennison, OH 44621 Bankruptcy Case No.: 10-64360 Chapter 11 Petition Date: October 13, 2010 Court: United States Bankruptcy Court Northern District of Ohio (Canton) Judge: Russ Kendig Debtor's Counsel: Shawn M. Riley, Esq. MCDONALD HOPKINS LLC 600 Superior Ave, E, #2100 Cleveland, OH 44114 Tel: (216) 348-5400 E-mail: sriley@mcdonaldhopkins.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Douglas J. Ross, Sr., board chairman. The Debtor did not file its list of largest unsecured creditors when it filed its petition. ULTIMATE ESCAPES: Gets Final Approval to Incur Loan and Use Cash ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware, in a final order, authorized Ultimate Escapes Holdings, LLC, et al., to obtain postpetition secured financing from CapitalSource Finance LLC, as administrative, payment and collateral agent, CapitalSource Bahamas LLC as collateral agent, and CapitalSource Bank as lender, and to use cash collateral. The Debtors are indebted to the original lender in the aggregate amount of $97,276,905 with respect to the prepetition loan. As reported in the Troubled Company Reporter on September 23, 2010, the DIP lenders have committed to provide up to $2,322,720 through October 8, 2010, and up to $3,631.983 through October 22, 2010. The DIP facility will mature on October 22, 2010. The Debtors would use the loan and the cash collateral to fund their Chapter 11 case, pay suppliers and other parties. As security for the DIP indebtedness, the Agents will be granted these security and liens in all currently owned or hereafter acquired property and assets of the Debtors: (a) perfected first priority senior security interest in the DIP facility collateral; (b) a perfected security interest in and lien upon the DIP facility collateral; (c) a perfected first priority senior priming lien on all of the DIP facility collateral, including the prepetition collateral, which will be senior to all other security interests and liens in the property of the Debtors' estates except for permitted liens and prepetition liens; and (d) neither the prepetition liens nor the DIP facility liens will be subject to subordination to any other liens, security interests or claims. The Agents and the original lender have consented to the Debtors' use of cash collateral. As adequate protection for any diminution in value, the Debtors will grant the Agents valid, binding, enforceable and perfected additional and replacement liens in all property of the Debtors' estates. If the adequate protection isn't sufficient, the Agents and the original lender will (i) have a claim allowed under Sections 507(a)(2) and 507(b) of the U.S. Bankruptcy Code; and (ii) be entitled to seek further adequate protection of its interests and further relief as consistent therewith. The Debtors will also grant the Agents and the original lender (a) repayment of the principal amount of the prepetition obligations in accordance with the DIP orders; and (b) payments in the amount of interest, fees, costs and expenses with respect to the prepetition obligations in accordance with the DIP orders. The prepetition obligations will bear interest at the applicable default rates in the DIP loan documents and the prepetition loan documents. The DIP indebtedness will bear interest at the same default rate as in the prepetition loan documents. The Debtors' access to the cash collateral is dependent on, among other things: -- auction for the sale of assets by October 21; -- Court approving the sale of assets by October 22; -- sale of assets closing by October 25, in the event that there are no qualified competing bids to that of the agents, DIP lender and original lender, or by October 29, if a qualified competing bid is submitted; or -- the occurrence of an event of default. About Ultimate Escapes, Inc. Ultimate Escapes, Inc. -- http://www.ultimateescapes.com/-- is a luxury destination club that sells club memberships offering members reservation rights to use its vacation properties, subject to the rules of the club member's Club Membership Agreement. The Company's properties are located in various resort locations throughout the world. Kissimmee, Florida-based Ultimate Escapes Holdings, LLC, filed for Chapter 11 bankruptcy protection on September 20, 2010 (Bankr. D. Del. Case No. 10-12915). Affiliates Ultimate Resort, LLC; Ultimate Operations, LLC; Ultimate Resort Holdings, LLC; Ultimate Escapes, Inc. (fka Secure America Acquisition Corporation); P & J Partners, LLC; UE Holdco, LLC; UE Member, LLC, et al., filed separate Chapter 11 petitions. Scott D. Cousins, Esq., Matthew L. Hinker, Esq., and Nancy A. Mitchell, Esq., at Greenberg Traurig LLP, assist the Debtors in their restructuring efforts. CRG Partners Group LLC is the Debtors' chief restructuring officer. BMC Group Inc. is the Company's claims and notice agent. Christopher A. Ward, Esq., at Polsinelli Shughart PC, and Gordon & Rees LLP represent the Creditors Committee. Ultimate Escapes estimated assets at $10 million to $50 million and debts at $100 million to $500 million as of the Petition Date. ULTIMATE ESCAPES: October 29 Set as General Claims Bar Date ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has established October 29, 2010, at 4:00 p.m. (prevailing Eastern Time) as the deadline for any individual or entity to file proofs of claim against Ultimate Escapes Holdings, LLC, et al. The Court also set January 31, 2011, as the governmental units bar date. Proofs of claim must be delivered to the Debtors' claims agent, The Garden City Group, Inc. About Ultimate Escapes, Inc. Ultimate Escapes, Inc. -- http://www.ultimateescapes.com/-- is a luxury destination club that sells club memberships offering members reservation rights to use its vacation properties, subject to the rules of the club member's Club Membership Agreement. The Company's properties are located in various resort locations throughout the world. Kissimmee, Florida-based Ultimate Escapes Holdings, LLC, filed for Chapter 11 bankruptcy protection on September 20, 2010 (Bankr. D. Del. Case No. 10-12915). Affiliates Ultimate Resort, LLC; Ultimate Operations, LLC; Ultimate Resort Holdings, LLC; Ultimate Escapes, Inc. (fka Secure America Acquisition Corporation); P & J Partners, LLC; UE Holdco, LLC; UE Member, LLC, et al., filed separate Chapter 11 petitions. Scott D. Cousins, Esq., Matthew L. Hinker, Esq., and Nancy A. Mitchell, Esq., at Greenberg Traurig LLP, assist the Debtors in their restructuring efforts. CRG Partners Group LLC is the Debtors' chief restructuring officer. BMC Group Inc. is the Company's claims and notice agent. Christopher A. Ward, Esq., at Polsinelli Shughart PC, and Gordon & Rees LLP represent the Creditors Committee. Ultimate Escapes estimated assets at $10 million to $50 million and debts at $100 million to $500 million as of the Petition Date. ULTIMATE ESCAPES: Plan Contemplates Liquidation of All Assets ------------------------------------------------------------- Ultimate Escapes Holdings, LLC, et al., submitted to the U.S. Bankruptcy Court for the District of Delaware a proposed liquidating 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 orderly liquidation of substantially all of the Debtors assets and the distribution of proceeds. Subject to the occurrence of the effective date, the Debtors and their estates will be deemed substantially consolidated for voting and distribution purposes only. Pursuant to the asset purchase agreement, UPB Acquisition Corp., an affiliate of Oaktree Capital Management, L.P., will purchase the Debtors' assets for $25 million in the form of a credit bid on account of the obligations owed to UPBA, subject to bigger and better offers. A liquidating trust will be created and vested with certain property and the liquidating trust will reduce to cash or otherwise liquidate the liquidating trust assets and distribute assets. Treatment of Claims and Interests Classes of Claims and Interests Estimated % Recovery ------------------------------ -------------------- Class 1 - Senior Creditor Claims 6.4% to 8.5% (after reducing claims on account of credit bid) Class 2 - Other Secured Claims 100% Class 3 - Other Priority Claims 100% Class 4 - Unsecured Claims 0% to 3% Class 5 - Intercompany Claims 0% Class 6 - Equity Interests 0% A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/UniversaBuilding_DS.pdf About Ultimate Escapes, Inc. Ultimate Escapes, Inc. -- http://www.ultimateescapes.com/-- is a luxury destination club that sells club memberships offering members reservation rights to use its vacation properties, subject to the rules of the club member's Club Membership Agreement. The Company's properties are located in various resort locations throughout the world. Kissimmee, Florida-based Ultimate Escapes Holdings, LLC, filed for Chapter 11 bankruptcy protection on September 20, 2010 (Bankr. D. Del. Case No. 10-12915). Affiliates Ultimate Resort, LLC; Ultimate Operations, LLC; Ultimate Resort Holdings, LLC; Ultimate Escapes, Inc. (fka Secure America Acquisition Corporation); P & J Partners, LLC; UE Holdco, LLC; UE Member, LLC, et al., filed separate Chapter 11 petitions. Scott D. Cousins, Esq., Matthew L. Hinker, Esq., and Nancy A. Mitchell, Esq., at Greenberg Traurig LLP, assist the Debtors in their restructuring efforts. CRG Partners Group LLC is the Debtors' chief restructuring officer. BMC Group Inc. is the Company's claims and notice agent. Christopher A. Ward, Esq., at Polsinelli Shughart PC, and Gordon & Rees LLP represent the Creditors Committee. Ultimate Escapes estimated assets at $10 million to $50 million and debts at $100 million to $500 million as of the Petition Date. ULTIMATE ESCAPES: Committee Taps FTI Consulting as Fin'l Advisor ---------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 cases of Ultimate Escapes Holdings, LLC, et al., asks the U.S. Bankruptcy Court for the District of Delaware for permission to employ FTI Consulting, Inc., as its financial advisors. FTI will, among other things: -- assist the Committee with he assessment and monitoring of the Debtors' short term cash flow, liquidity and operating results; -- assist in the review of financial information distributed by the Debtors to creditors and others, including, but not limited to, cash flow projections and budgets, cash receipts and disbursements analysis, analysis of various asset and liability accounts, and analysis of proposed transactions of which Court's approval is sought; and -- render other general business consulting or other assistance as the Committee or its counsel may deem necessary that are consistent with the role of a financial advisor and not duplicative of services provided by other professionals in the Debtors' Chapter 11 cases. Conor P. Tully, senior managing director with FTI, tells the Court that the hourly rates of FTI's personnel are: Senior Managing Directors $755 - $885 Directors/Managing Directors $545 - $725 Consultants/Senior Consultants $270 - $515 Administration/Assosiates $110 - $250 Mr. Tully assures the Court that FTI is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Ultimate Escapes, Inc. Ultimate Escapes, Inc. -- http://www.ultimateescapes.com/-- is a luxury destination club that sells club memberships offering members reservation rights to use its vacation properties, subject to the rules of the club member's Club Membership Agreement. The Company's properties are located in various resort locations throughout the world. Kissimmee, Florida-based Ultimate Escapes Holdings, LLC, filed for Chapter 11 bankruptcy protection on September 20, 2010 (Bankr. D. Del. Case No. 10-12915). Affiliates Ultimate Resort, LLC; Ultimate Operations, LLC; Ultimate Resort Holdings, LLC; Ultimate Escapes, Inc. (fka Secure America Acquisition Corporation); P & J Partners, LLC; UE Holdco, LLC; UE Member, LLC, et al., filed separate Chapter 11 petitions. Scott D. Cousins, Esq., Matthew L. Hinker, Esq., and Nancy A. Mitchell, Esq., at Greenberg Traurig LLP, assist the Debtors in their restructuring efforts. CRG Partners Group LLC is the Debtors' chief restructuring officer. BMC Group Inc. is the Company's claims and notice agent. Christopher A. Ward, Esq., at Polsinelli Shughart PC, and Gordon & Rees LLP represent the Creditors Committee. Ultimate Escapes estimated assets at $10 million to $50 million and debts at $100 million to $500 million as of the Petition Date. US FIDELIS: Wants Dec. 31 Extension of Plan Filing Exclusivity -------------------------------------------------------------- US Fidelis, Inc., ask the U.S. Bankruptcy Court for the Eastern District of Missouri to further extend the plan filing exclusive period through December 31, 2010, and an extension of the plan acceptance exclusive period through March 1, 2011. On July 2, 2010, the Court granted the Debtor's first motion to extend the plan filing exclusivity period through and including September 30, 2010, as to all parties-in-interest with the exception of the Committee, and to extend the plan acceptance exclusivity period through and including November 29, 2010, as to all parties-in-interest with the exception of the Committee. The Debtor asks for further extension given the number of creditors holding secured and unsecured claims against the Debtor's estate, the complex nature of the Debtor's operations, and the number of significant adversary proceedings currently associated with the Debtor's Chapter 11 bankruptcy case. The Court has set a hearing for on October 20, 2010, at 9:30 a.m. on the Debtor's request. Wentzville, Missouri-based US Fidelis, Inc., was a marketer of vehicle service contracts developed by independent and unrelated companies. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. E.D. Mo. Case No. 10-41902). Robert E. Eggmann, Esq., at Lathrop & Gage, assists the Company in its restructuring effort. According to the schedules, the Company had assets of $74,386,836, and total debts of $25,770,655 as of the petition date. US FIDELIS: Proofs of Claim Deadline for Non-Consumers on Dec. 1 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Missouri has established December 1, 2010, as the deadline for non-consumer claimants to file proofs of claim against US Fidelis, Inc. Proofs of claim must be delivered to: Clerk of the Bankruptcy Court United States Bankruptcy Court Eastern District of Missouri, Eastern Division Thomas F. Eagleton United States Courthouse 111 S. Tenth Street, 4th Floor ST. Louis, MO 63102 Wentzville, Missouri-based US Fidelis, Inc., was a marketer of vehicle service contracts developed by independent and unrelated companies. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. E.D. Mo. Case No. 10-41902). Robert E. Eggmann, Esq., at Lathrop & Gage, assists the Company in its restructuring effort. According to the schedules, the Company had assets of $74,386,836, and total debts of $25,770,655 as of the petition date. USEC INC: Amends & Restates Credit Agreement With JPMorgan Chase ---------------------------------------------------------------- USEC Inc. and its wholly owned subsidiary United States Enrichment Corporation entered effective Oct. 8, 2010, into a Third Amended and Restated Credit Agreement with the lenders parties thereto, JPMorgan Chase Bank, N.A., as administrative and collateral agent, and the revolving joint book managers, revolving joint lead arrangers and other agents. The Amended Credit Agreement amends and restates the Second Amended and Restated Revolving Credit Agreement dated as of February 26, 2010 by and among USEC, United States Enrichment Corporation, the lenders parties thereto, JPMorgan Chase Bank, N.A., as administrative and collateral agent, and the joint book managers, joint lead arrangers and other agents, as amended. The Amended Credit Agreement adds an $85 million term loan facility to the Company's existing revolving credit facility. The total Credit Facility is now $310 million. As part of the Amended Credit Agreement, $25 million of existing lender commitments was moved from the existing Revolving Credit Facility to the Term Loan, resulting in aggregate lender commitments under the Revolving Credit Facility of $225 million. The Amended Credit Agreement increases the letter of credit sublimit to $150 million. The Revolving Credit Facility may be expanded through additional commitments up to an aggregate of $250 million in revolving credit commitments. The Amended Credit Agreement also provides that USEC may increase the amount of the Term Loan from $85 million up to $100 million, subject to USEC obtaining additional commitments. As a result, the total Credit Facility could be expanded through additional commitments and term loans to up to $350 million. The Term Loan is 100% funded. The Term Loan was issued with an original issue discount of 2% and will bear interest, at the election of USEC, at either: 1) the JPMorgan Chase Bank prime rate or the federal funds rate plus 6.5%; or 2) an adjusted 1-month LIBO Rate plus 7.5%. There is a floor on the adjusted 1-month LIBO Rate for the Term Loan of 2.0%. The interest rate on outstanding borrowings under the Revolving Credit Facility is unchanged and, at USEC's election, is either: * the sum of (1) the greatest of (a) the JPMorgan Chase Bank prime rate, (b) the federal funds rate plus � of 1%, or (c) an adjusted 1-month LIBO Rate plus 1% plus (2) a margin ranging from 2.25% to 2.75% based upon availability; or * the sum of the LIBO Rate plus a margin ranging from 4.0% to 4.5% based upon availability. The Credit Facility matures on May 31, 2012. The Term Loan is subject to mandatory prepayment consistent with the Existing Credit Agreement. The Term Loan may be prepaid voluntarily subject to a prepayment fee of 2% of the amount if prepaid before October 8, 2011 and 1% of the amount if prepaid after October 8, 2011 but prior to January 1, 2012. The Amended Credit Agreement also increases the ACP Spending Basket to $165 million. Under the terms of the Amended Credit Agreement, the Company is subject to restrictions on its ability to spend on the American Centrifuge project. Subject to certain limitations when availability falls below certain thresholds, the Amended Credit Agreement permits the Company to spend up to $165 million for the American Centrifuge project over the term of the credit facility. The Credit Facility does not restrict the investment of proceeds of grants and certain other financial accommodations that may be received from the U.S. Department of Energy or other third parties that are specifically designated for investment in the American Centrifuge project. Under this provision, the $45 million made available by DOE pursuant to a cooperative agreement entered into with USEC in March 2010 for continued American Centrifuge activities is not restricted by the Credit Facility or counted towards the ACP Spending Basket. In addition to the ACP Spending Basket, the Credit Facility also permits the investment in the American Centrifuge project of net proceeds from additional equity capital raised by USEC, subject to certain provisions and certain limitations when availability falls below certain thresholds. The $75 million investment from Toshiba Corporation and B&W made at the first closing of the transactions on September 2, 2010 was not restricted or counted toward the ACP Spending Basket. Certain of the lenders, as well as certain of their respective affiliates, have performed, and may in the future perform, for the Company and its subsidiaries, various commercial banking, investment banking, underwriting and other financial advisory services, for which they have received, and will receive, customary fees and expenses. A full-text copy of the Amended Credit Agreement is available for free at http://ResearchArchives.com/t/s?6c91 About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- supplies enriched uranium fuel for commercial nuclear power plants. The Company's balance sheet at June 30, 2010, showed $3.6 billion in total assets, $1.2 billion in total current liabilities, $556.0 million in other long-term liabilities, and stockholders' equity of $1.2 billion. * * * USEC Inc. carries 'Caa1' corporate and probability of default ratings, with "developing" outlook, from Moody's, and 'CCC+' long term foreign issuer credit rating and 'CCC-' long term local issuer credit rating, with outlook "developing", from Standard & Poor's. In May 2010, S&P said that its rating and outlook on USEC Inc. are not affected by the announcement that Toshiba Corp. and Babcock & Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co., have signed a definitive investment agreement for $200 million with USEC. VIRTUAL GEOSATELLITE: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Virtual Geosatellite, LLC 4410 Massachusetts Ave, NW Washington, DC 20016 Bankruptcy Case No.: 10-01001 Chapter 11 Petition Date: October 8, 2010 Court: United States Bankruptcy Court District of Columbia (Washington, D.C.) Judge: S. Martin Teel, Jr. Debtor's Counsel: Natalie S. Walker, Esq. WEBSTER, FREDRICKSON, CORREIA & PUTH 1775 K Street, NW, Suite 600 Washington, DC 20006 Tel: (202) 659-8510 E-mail: nwalker@wfcplaw.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. The petition was signed by David Castiel, CEO. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Ellipso, Inc. 09-0148 02/25/2009 VWE GROUP: Court Dismisses Ponzi Scheme Claims as Time-Barred ------------------------------------------------------------- In David Cohain D.D.S., et al., v. Laura Klimley, et al.; D. Kent Sissel, et al., v. Laura Klimley, et al.; and Wayne E. Pullins, David E. Pullins and Dianne H. Pullins, v. John Palmero, case nos. 08-Civ.-5047, 09-Civ.-4527, 09-Civ.-10584, the Hon. Paul G. Gardephe granted defendant Laura Klimley and John Palmero's motions to dismiss the Cohain and Sissel Actions. Mr. Palmero's motion to dismiss is denied with respect to the Pullins Plaintiffs' claims for common law fraud and civil conspiracy but otherwise granted. Judge Gardephe held that the Plaintiffs commenced their actions after the statutes of limitations expired. Therefore, the claims are time-barred. The three actions arise from Plaintiffs' purchase of debt instruments from VWE Group, Inc., alleging a ponzi scheme. The suits were filed in 2008. When VWE filed its bankruptcy petition, the aggregate outstanding principal of the Notes was more than $26 million. A copy of the Court's Memorandum Opinion & Order dated Sept. 20, 2010, is available at: http://www.leagle.com/unsecure/page.htm?shortname=infdco20100920794 In 1958, Victor Eimicke formed VWE Group, Inc. Yonkers, N.Y.- based VWE sold materials designed to assist employers in "the hiring, firing and motivation of employees." VWE later began producing and selling greeting cards, a business which ultimately accounted for the majority of its revenues. In December 2003, VWE sold the greeting card business. The company filed for chapter 11 protection on June 1, 2004 (Bankr. S.D.N.Y. Case No. 04-20308). Joseph O'Neil, Jr., Esq., at Reed Smith LLP, represented the Debtor. WASHINGTON MUTUAL: Wins Nod to Send Plan to Creditors for Voting ---------------------------------------------------------------- Washington Mutual, Inc. disclosed that the United States Bankruptcy Court for the District of Delaware has approved the Disclosure Statement filed in connection with the Company's proposed Plan of Reorganization, subject to WMI filing the final version of the Disclosure Statement with the Bankruptcy Court. Approval of the Disclosure Statement allows WMI to solicit approval of the Plan from its creditors. The Bankruptcy Court has set the voting deadline for November 15, 2010, for eligible stakeholders. The Court has scheduled a hearing to consider the approval of the Plan beginning on December 1, 2010. On October 6, 2010, WMI filed with the Court the proposed Plan and Disclosure Statement. The Plan and Disclosure Statement are premised upon consummating an amended and restated global settlement agreement and JPMorgan Chase Bank, N.A. The Plan, Disclosure Statement, and the Settlement have the full support of the FDIC, JPMC, certain holders of indebtedness issued by the Company and Washington Mutual Bank, as the case may be, and the Official Committee of Unsecured Creditors, which was appointed by the Bankruptcy Court. As previously announced, the Plan contemplates, among other things, distribution of funds to holders of allowed claims against the estate in excess of approximately $7 billion, including approximately $4 billion of previously disputed funds on deposit with JPMC. WMI believes the Settlement will result in significant recoveries for the estate's stakeholders and is in the best interests of the estate. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500,000,000 to $1,000,000,000 with zero debts. Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP, serve as legal counsel to WMI with responsibility for the litigation. Brian Rosen, Esq., at Weil, Gotshal & Manges LLP, serves as legal counsel to WMI with responsibility for the Chapter 11 case. WARNER MUSIC: Oaktree Capital Reports 6.1% Equity Stake ------------------------------------------------------- Various funds affiliated with Oaktree Capital Group Holdings GP, LLC, disclosed that they may be deemed to beneficially own 9,425,000 shares or roughly 6.1% of the common stock of Warner Music Group Corp. as of October 6, 2010. As of August 2, 2010, 154,732,150 shares of Warner Music Common Stock are outstanding. About Warner Music Group Based in New York, Warner Music Group Corp. (NYSE: WMG) -- http://www.wmg.com/-- was formed by a private equity consortium of investors on November 21, 2003. The Company is the direct parent of WMG Holdings Corp., which is the direct parent of WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's major music-based content companies and the successor to substantially all of the interests of the recorded music and music publishing businesses of Time Warner Inc. The Company classifies its business interests into two fundamental operations: Recorded Music and Music Publishing. The Company's Recorded Music business primarily consists of the discovery and development of artists and the related marketing, distribution and licensing of recorded music produced by such artists. The Company's Music Publishing operations include Warner/Chappell, its global Music Publishing company, headquartered in New York with operations in over 50 countries through various subsidiaries, affiliates and non-affiliated licensees. The Company's balance sheet at June 30, 2010, showed $3.65 billion in total assets, $3.82 billion in total liabilities, and stockholders' deficit of $174 million. * * * As reported by the Troubled Company Reporter, Standard & Poor's Ratings Services on Aug. 13, 2010, revised its rating outlook on Warner Music Group Corp. to negative from stable. Ratings on the company, including the 'BB-' corporate credit rating, were affirmed. "The revised outlook reflects continued revenue and EBITDA declines amid a light album release schedule and ongoing challenges in maintaining profitability levels due to the digital transition taking place within the industry, notwithstanding vigilant cost management," said Standard & Poor's credit analyst Michael Altberg. As reported by the TCR on October 4, 2010, Fitch affirmed these ratings: Warner Music Group Corp. (IDR at 'BB-'.); WMG Holdings Corp. (IDR at 'BB-'; and -- Unsecured notes at 'B'); and WMG Acquisition Corp. (IDR at 'BB-'; Secured notes at 'BB'; Subordinated notes at 'B+'). Fitch's ratings are supported by WMG's market position as the third largest music distributor/label, with a 20% market share according to Nielsen SoundScan. Fitch said liquidity is sufficient, as the company generates sufficient cash to support operations and capital expenditures. As of June 30, 2010, WMG had $400 million in consolidated cash and cash equivalents (including $176 million of cash at the parent holding company). There are no maturities until 2014, when approximately $900 million in subordinated debt (including WMG Holdings Corp. notes) are due. WILLIAM NORRIE: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: William R. Norrie 665 33rd Street Manhattan Beach, CA 90266 Bankruptcy Case No.: 10-53949 Involuntary Chapter 11 Petition Date: October 13, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Ernest M. Robles Petitioners' Counsel: Pro Se Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ William Malcolm Norrie Loan $50,000 187 Sunset Terrace Laguna Beach, CA 92651 Katherine Norah Norrie Loan $100,000 187 Sunset Terrace Laguna Beach, CA 92651 John David Norrie Loan $75,000 14 Monarch Bay Plaza Monarch Beach, CA 92629 WORKSTREAM INC: Delays Filing of Quarterly Report on Form 10-Q -------------------------------------------------------------- Workstream Inc. said it could not file timely its quarterly report on Form 10-Q for the period ended Aug. 31, 2010, with the Securities and Exchange Commission. On August 13, 2010, the Company completed (a) an exchange of approximately $22.3 million of its senior secured notes for common shares in the Registrant, (b) a private placement of common shares for $1.25 million and (c) an issuance of a new senior secured note in the principal face amount of $750,000. As a result of the Exchange, the Company's financial results are subject to significant transaction-related adjustments. Although, the Company has devoted substantial time and effort to incorporate the Exchange related transactions into its Form 10-Q for the quarterly period ended August 31, 2010, the Company has determined that it is unable to file the Form 10-Q by the prescribed due date without unreasonable effort or expense. The Company said it is in the process of incorporating the adjustments into its Form 10-Q and intends to file its Form 10-Q with the SEC as promptly as practicable. The Company said it is not presently aware of any circumstances that would prevent it from filing its Form 10-Q on or before the fifth calendar day following the prescribed due date in compliance with Rule 12b-25. About Workstream Inc. Maitland, Fla.-based Workstream Inc. (OTC BB: WSTM.OB) provides enterprise workforce management solutions and services that help companies manage the entire employee lifecycle -- from recruitment to retirement. Workstream services customers with offices across North America. The Company's balance sheet at May 31, 2010, showed $8.6 million in total assets, $28.7 million in total liabilities, and a stockholders' deficit of $20.1 million. YELLOWSTONE CLUB: Robert Sumpter Claim Reduced to $250,000 ---------------------------------------------------------- The Hon. Ralph B. Kirscher grants Robert Sumpter an allowed unsecured nonpriority claim for $250,000 in the bankruptcy case of Yellowstone Mountain Club LLC. Judge Kirscher also grants Yellowstone Club Liquidating Trust's Motion for Summary Judgment of Mr. Sumpter's Proof of Claim No. 741 filed August 12, 2010, and sustains the Liquidating Trust's objection to the claim. Judge Kirscher holds that Mr. Sumpter's claim for damages above and beyond his $250,000 membership deposit is speculative and not provided for under the Membership Agreement. Mr. Sumpter formerly was employed by YMC as director of development. In the days immediately preceding the August 2008 transfer of YMC ownership to Edra Blixseth, Mr. Sumpter exchanged his Company Membership for a Resident Membership, and paid to YMC a $250,000 Resident Membership deposit. YMC later recalled the membership. Mr. Sumpter asserted an unsecured claim for $4,316,000 for breach of contract damages under 11 U.S.C. Sec. 365(g). The Yellowstone Club Liquidating Trust is represented by: Robert L. Sterup, Esq. HOLLAND & HART LLP 401 North 31st Street, Suite 1500 Billings, MT 59101-1277 Tel: (406) 252-2166 Fax: (406) 252-1669 E-mail: rsterup@hollandhart.com Mr. Sumpter is represented in the case by: Stephen C. Mackey TOWE, BALL, ENRIGHT, MACKEY & SOMMERFELD, P.L.L.P. 2525 Sixth Avenue North P.O. Box 30457 Billings, Montana 59107-0457 Tel: (406) 248-7337 Fax: (406) 248-2647 A copy of the Court's Memorandum of Decision dated Oct. 14, 2010, is available at http://is.gd/g6smH from Leagle.com About Yellowstone Club Located near Big Sky, Montana, Yellowstone Club -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Mountain Club LLC and its affiliates filed for Chapter 11 on Nov. 10, 2008 (Bankr. D. Mont. Case No. 08-61570). The Company's owner affiliate Edra D. Blixseth, filed for Chapter 11 on March 27, 2009 (Bankr. D. Mont. Case No. 09-60452). In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners, LLC, acquired equity ownership in the reorganized club for $115 million. Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC, represented the Debtors. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer, as counsel, and James H. Cossitt, Esq., at local counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. The Court entered an order confirming The Yellowstone Club's Chapter 11 Plan of Reorganization in June 2009. YURI PLYAM: Ch. 11 Case Dismissed at Request of Creditors --------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California dismissed the Chapter 11 case of Yuri Plyam and Natalia Plyam. As reported in the Troubled Company Reporter on June 30, 2010, creditors Precision Development, LLC, and Castle Asset Management, LLC, claimed that the Debtors' bankruptcy filing was made in bad faith and must be dismissed. Precision Development and Castle Asset are owned by Clare and Sara Bronfman. Yuri and Natalia Plyam, who were financial advisors to the Bronfmans, were managers and minority owners of Precision and Castle Asset. The Bronfmans were majority and passive owners. The Bronfmans contend that the Plyams embezzled millions of dollars from the venture to pursue an opulent and decadent lifestyle. The Bronfmans' unsecured claims against the Plyams consist of 98.8% of the entirety of all unsecured claims listed on the Plyams' list of top 20 unsecured creditors filed with the Petition. The other 1.2% claims on the Top 20 List consist largely of claims of the Plyams' lawyers and experts employed to defend the State Court Case. "There is no federal Bankruptcy Court interest in asserting control over what should be a state court dispute. This is a two-party dispute which should be returned to the state court," Precision Development and Castle Asset stated. The Debtors are also prohibited from filing any new Chapter 11 bankruptcy petition at any time unless the Debtors obtains a further order from the Court. The Debtors are also advised to pay any and all outstanding U.S. Trustee quarterly fees before the filing of any new Chapter 11 petition. The Debtors must pay the U.S. Trustee $650 for quarterly fee. About Yuri Plyam Beverly Hills, California-based Yuri Plyam aka Yura Plyam and Natalia Plyam aka Natasha Plyam filed for Chapter 11 bankruptcy protection on June 18, 2010 (Bankr. C.D. Calif. Case No. 10- 34923). Michael Jay Berger, Esq., who has an office in Beverly Hills, California, assists the Debtors in their restructuring effort. The Debtors estimated their assets and debts at $10 million to $50 million. * Aspatore Books Publishes Trends in Commercial Bankruptcy Filings ------------------------------------------------------------------ Aspatore Books, a Thomson Reuters business, released an authoritative book providing insight into the latest developments in commercial bankruptcy filings titled "Trends in Commercial Bankruptcy Filings (isbn:978-0-314-26855-6). Jonathan Carson and Michael Frishberg of Kurtzman Carson Consultants (KCC), a Computershare company and a leading claims and noticing agent, were selected as co-authors to contribute perspective on the administrative challenges facing companies undergoing Chapter 11 bankruptcy within the ever-changing corporate restructuring landscape. "We were honored to contribute our unique perspective on the Chapter 11 process with an eye towards the administrative hurdles that debtors and their professionals often encounter throughout corporate restructuring," commented Jonathan Carson, KCC's managing director and co-founder. "We developed the chapter based upon our combined experience as corporate restructuring attorneys and our current roles supporting the administrative needs of the most complex Chapter 11 filings in the country." In addition to Jonathan Carson and Michael Frishberg, who formerly practiced in the Restructuring practice of Kirkland & Ellis, the book featured partners from some of the nation's leading law firms. From navigating recent trends in 363 asset sales and liquidations to understanding changes in credit bidding, these authors offer tips on remaining up-to-date in the current economic environment. The different niches represented and the breadth of perspectives presented enable readers to get inside some of the great legal minds of today, as these experienced lawyers offer up their thoughts around the keys to success in this rapidly-changing area of law. The Inside the Minds series provides readers with an unprecedented introspective look into the leading minds of the business and legal world. For complete information on Aspatore titles, please visit http://www.west.thomson.com/aspatore/ or e-mail West.customer.service@thomson.com This book can be purchased immediately by calling 1-866-ASPATORE or by visiting: http://west.thomson.com/productdetail/176577/41079597/productdetai l.aspx About Aspatore, a Thomson Reuters Business Aspatore Books, a Thomson Reuters business, exclusively publishes C-Level executives from the world's most respected companies and law firms. C-Level Business Intelligence(TM), as conceptualized and developed by Aspatore Books, provides professionals of all levels with proven business intelligence from industry insiders-- direct and unfiltered insight from those who know it best--as opposed to third-party accounts offered by unknown authors and analysts. Aspatore Books is committed to publishing an innovative line of business and legal books, those which lay forth principles and offer insights that when employed, can have a direct financial impact on the reader's business objectives. In essence, Aspatore publishes critical tools for all business professionals. * Wilson Sonsini & Rosati Expands Corporate Finance Practice ------------------------------------------------------------ Wilson Sonsini Goodrich & Rosati, the premier provider of legal services to technology, life sciences, and growth enterprises worldwide, today announced that Charlotte Kim has joined the firm as a partner in the corporate finance practice. She comes to the firm from Choate Hall & Stewart, where she was a partner in their finance and restructuring practice. Kim will be based in Wilson Sonsini Goodrich & Rosati's New York office. "Charlotte is a gifted attorney with considerable experience representing both borrowers and lenders in a wide variety of complex corporate finance transactions," said CEO Steve Bochner. "Her legal skills, outstanding client service, and extensive representation of companies at all stages of development make her a perfect fit for the firm. She will lend additional expertise to our thriving corporate finance practice, and allow us to better serve companies and financial institutions on the East Coast." With particular experience in the energy, healthcare, and technology sectors, Kim works with public and private companies and their investors on their debt capital structures and financing needs throughout the life cycle of the enterprise, from start-up through operations, acquisitions, investments, securities offerings, and restructuring. In addition, she works with financial institutions and investors on all aspects of cash-flow and asset-based financings. Her transactional experience encompasses senior, subordinated, and other junior lending; buyout and acquisition finance; private placements and debt securities offerings; venture debt; domestic and international corporate finance; project finance; securitizations; lease financings; related derivative transactions; and restructuring transactions, both in and out of bankruptcy. Her international experience includes numerous cross-border transactions and investments involving the U.S., Europe, Asia, and Latin America. Overall, she has structured, negotiated, and closed as lead attorney more than 140 corporate finance transactions totaling more than $20 billion in value. Prior to joining Choate, Kim had been an associate at Chadbourne & Parke and Milbank, Tweed, Hadley & McCloy in New York. She received her J.D. from Harvard Law School in 1995, was a Fulbright Scholar at the Centre for European Policy Studies in Belgium from 1991-1992, and graduated magna cum laude from Harvard University in 1991 with a degree in social studies. About Wilson Sonsini Goodrich & Rosati Wilson Sonsini Goodrich & Rosati's broad range of services and legal disciplines is focused on serving the principal challenges faced by the management and boards of directors of business enterprises. The firm is nationally recognized as a leader in the fields of corporate governance and finance, mergers and acquisitions, private equity, securities class action litigation, employment law, intellectual property, and antitrust, among many other areas of law. With long-standing roots in Silicon Valley, Wilson Sonsini Goodrich & Rosati has offices in Austin, New York, Palo Alto, San Diego, San Francisco, Seattle, Shanghai, and Washington, D.C. In addition, the firm has applied for a license to open an office in Hong Kong. * Bankruptcy Lawyers Field Calls From Troubled Municipalities ------------------------------------------------------------- Cadwalader, Wickersham & Taft LLP is no stranger to restructuring international corporations, but the New York law firm recently took on a different type of client - a school district, DBR Small Cap reports. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Total Share- Total Working Holders' Assets Capital Equity Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------- -------- AUTOZONE INC AZO US 5,571.6 (452.1) (738.8) LORILLARD INC LO US 3,140.0 1,654.0 (54.0) DUN & BRADSTREET DNB US 1,632.5 (475.7) (783.9) MEAD JOHNSON MJN US 2,032.0 357.5 (509.3) BOARDWALK REAL E BOWFF US 2,364.5 - (64.6) BOARDWALK REAL E BEI-U CN 2,364.5 - (64.6) TAUBMAN CENTERS TCO US 2,560.9 - (510.5) NAVISTAR INTL NAV US 9,418.0 2,011.0 (1,040.0) CHOICE HOTELS CHH US 390.2 (291.4) (97.0) WEIGHT WATCHERS WTW US 1,090.1 (344.4) (693.5) SUN COMMUNITIES SUI US 1,167.4 - (123.0) TENNECO INC TEN US 2,980.0 286.0 (47.0) UNISYS CORP UIS US 2,714.4 366.1 (1,080.1) WR GRACE & CO GRA US 4,053.3 1,257.7 (229.5) CABLEVISION SYS CVC US 7,631.6 3.8 (6,183.6) MOODY'S CORP MCO US 1,957.7 (134.2) (491.9) IPCS INC IPCS US 559.2 72.1 (33.0) UNITED CONTINENT UAL US 20,134.0 (1,590.0) (2,756.0) THERAVANCE THRX US 232.4 180.2 (126.0) VENOCO INC VQ US 709.1 14.1 (118.6) DISH NETWORK-A DISH US 9,031.0 608.6 (1,580.3) HEALTHSOUTH CORP HLS US 1,756.1 112.5 (429.9) CHENIERE ENERGY CQP US 1,769.5 37.3 (503.5) VECTOR GROUP LTD VGR US 850.0 288.8 (19.6) NATIONAL CINEMED NCMI US 725.5 90.2 (381.7) OTELCO INC-IDS OTT-U CN 333.3 25.6 (1.2) INCYTE CORP INCY US 493.7 340.3 (104.8) PROTECTION ONE PONE US 562.9 (7.6) (61.8) ARVINMERITOR INC ARM US 2,817.0 313.0 (909.0) OTELCO INC-IDS OTT US 333.3 25.6 (1.2) CARDTRONICS INC CATM US 472.6 (25.3) (2.1) UNITED RENTALS URI US 3,574.0 24.0 (50.0) JUST ENERGY INCO JE-U CN 1,780.6 (470.0) (279.3) DISH NETWORK-A EOT GR 9,031.0 608.6 (1,580.3) LIBBEY INC LBY US 794.2 144.4 (11.7) KNOLOGY INC KNOL US 648.0 48.7 (13.5) TEAM HEALTH HOLD TMH US 828.2 80.0 (37.8) INTERMUNE INC ITMN US 161.4 84.7 (46.5) REGAL ENTERTAI-A RGC US 2,575.0 (219.7) (283.5) DOMINO'S PIZZA DPZ US 418.6 88.0 (1,263.1) BOSTON PIZZA R-U BPF-U CN 110.2 2.3 (117.7) REVLON INC-A REV US 776.3 76.9 (1,011.8) AFC ENTERPRISES AFCE US 114.5 (0.2) (4.0) FORD MOTOR CO F US 183,156.0 (23,512.0) (3,541.0) GRAHAM PACKAGING GRM US 2,096.9 228.4 (612.2) WORLD COLOR PRES WC CN 2,641.5 479.2 (1,735.9) SALLY BEAUTY HOL SBH US 1,517.1 345.6 (523.9) WORLD COLOR PRES WCPSF US 2,641.5 479.2 (1,735.9) WORLD COLOR PRES WC/U CN 2,641.5 479.2 (1,735.9) JAZZ PHARMACEUTI JAZZ US 97.3 (24.2) (16.3) SUPERMEDIA INC SPMD US 3,261.0 522.0 (22.0) PETROALGAE INC PALG US 6.1 (8.9) (47.4) COMMERCIAL VEHIC CVGI US 276.9 111.2 (10.4) ALASKA COMM SYS ALSK US 627.4 15.0 (11.3) US AIRWAYS GROUP LCC US 8,131.0 (220.0) (168.0) BLUEKNIGHT ENERG BKEP US 297.3 (431.2) (149.9) FORD MOTOR CO F BB 183,156.0 (23,512.0) (3,541.0) AMER AXLE & MFG AXL US 2,027.7 31.7 (520.4) RURAL/METRO CORP RURL US 288.5 34.6 (101.2) CENTENNIAL COMM CYCL US 1,480.9 (52.1) (925.9) HALOZYME THERAPE HALO US 51.5 38.3 (14.1) MORGANS HOTEL GR MHGC US 774.4 50.5 (4.3) RSC HOLDINGS INC RRR US 2,690.2 (120.0) (33.8) LIONS GATE LGF US 1,592.9 (783.4) (1.6) SINCLAIR BROAD-A SBGI US 1,539.8 52.1 (170.4) NPS PHARM INC NPSP US 193.8 129.0 (179.5) CC MEDIA-A CCMO US 17,286.8 1,240.8 (7,209.3) MANNKIND CORP MNKD US 239.6 11.0 (137.7) QWEST COMMUNICAT Q US 18,959.0 (424.0) (1,241.0) AMR CORP AMR US 25,885.0 (2,015.0) (3,930.0) MITEL NETWORKS C MITL US 624.5 162.6 (48.1) ACCO BRANDS CORP ABD US 1,064.0 242.5 (125.6) SANDRIDGE ENERGY SD US 3,128.7 (109.4) (118.5) PALM INC PALM US 1,007.2 141.7 (6.2) GENCORP INC GY US 981.8 150.8 (224.9) NEXSTAR BROADC-A NXST US 584.5 33.0 (187.2) PDL BIOPHARMA IN PDLI US 271.5 (66.5) (434.9) PLAYBOY ENTERP-A PLA/A US 189.0 (12.4) (27.6) PLAYBOY ENTERP-B PLA US 189.0 (12.4) (27.6) VIRGIN MOBILE-A VM US 307.4 (138.3) (244.2) ARQULE INC ARQL US 118.5 53.9 (4.1) CONSUMERS' WATER CWI-U CN 887.2 3.2 (258.0) CENVEO INC CVO US 1,553.4 199.9 (183.8) WARNER MUSIC GRO WMG US 3,655.0 (546.0) (174.0) GLG PARTNERS-UTS GLG/U US 400.0 156.9 (285.6) GLG PARTNERS INC GLG US 400.0 156.9 (285.6) LIN TV CORP-CL A TVL US 783.5 28.7 (156.5) EPICEPT CORP EPCT SS 11.4 3.3 (10.2) STEREOTAXIS INC STXS US 50.9 (0.2) (0.8) EASTMAN KODAK EK US 6,791.0 1,423.0 (208.0) GREAT ATLA & PAC GAP US 2,677.1 (51.0) (524.0) HOVNANIAN ENT-B HOVVB US 1,909.8 1,264.2 (207.4) EXELIXIS INC EXEL US 419.7 12.8 (214.7) ABSOLUTE SOFTWRE ABT CN 124.3 (5.1) (2.6) HOVNANIAN ENT-A HOV US 1,909.8 1,264.2 (207.4) PRIMEDIA INC PRM US 218.9 (5.9) (102.1) MAGMA DESIGN AUT LAVA US 74.6 9.6 (6.1) DENNY'S CORP DENN US 296.7 (23.2) (112.9) IDENIX PHARM IDIX US 77.2 38.1 (7.3) ALEXZA PHARMACEU ALXA US 71.3 21.0 (28.7) NEWCASTLE INVT C NCT US 3,594.5 - (837.5) ARRAY BIOPHARMA ARRY US 159.2 39.4 (116.7) ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers" public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, Joseph Medel C. Martirez, Denise Marie Varquez, Philline Reluya, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2010. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***