/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/101103.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, November 3, 2010, Vol. 14, No. 305 Headlines ADVANTA CORP: Files Plan; Unsecureds to See 37%-71% Recovery ALMATIS B.V.: Bankr. Professionals File Final Fee Applications ALMATIS B.V.: Files Bankruptcy Closing Report ALTACANADA ENERGY: May Face Receivership if Planned Sale Fails AMEGY BANK: Moody's Cuts Issuer Rating to B1 From Ba3 AMERICAN ACHIEVEMENT: Moody's Upgrades Corp. Family Rating to 'B3' AMERICAN APPAREL: Posts $14.7 Million Net Loss in June 30 Quarter AMERICAN INT'L: Raises $37 Billion to Repay U.S. Government AMERIGAS PARTNERS: Fitch Affirms 'BB+' Issuer Default Rating AMR CORP: S&P Changes Outlook to Stable, Affirms 'B-' Rating AMSOUTH BANCORP: Moody's Cuts Regular Bond/Debenture Rating to Ba2 ANGIOTECH PHARMACEUTICALS: Moody's Cuts Default Rating to 'Ca/LD' APPALACHIAN OIL: U.S. Trustee Wants Case Converted to Chapter 7 APPALACHIAN OIL: Committee Withdraws Objection to Plan APARTMENTS AT JUPITER: Case Summary & Creditors List ASBURY AUTOMOTIVE: S&P Assigns 'B-' Rating to $200 Mil. Notes AWAL BANK BSC: Section 341(a) Meeting Set for December 1 BANNING LEWIS: Bankr. Filing Broke Deadlock Among Stakeholders BERNARD L MADOFF: Recoveries by Trustee Now at $1.5 Billion BERNARD L MADOFF: Trustee Extends Hardship Program BK INVESTMENTS: Case Summary & 2 Largest Unsecured Creditors BLOCKBUSTER INC: Wins Final Approval for $125MM of DIP Financing BLOCKBUSTER INC: Wins Final Approval for Access to Cash Collateral BLOCKBUSTER INC: Wins Nod to Pay $68.5 Mil. in Debt to Studios BONEYARD LLC: Chapter 11 Reorganization Case Dismissed BYSYNERGY LLC: Wants Case Dismissed as Property Foreclosed CALIFORNIA BANK: Moody's Cuts Issuer Rating to B1 From Ba3 CAPMARK FINANCIAL: Judge Approves $975M Settlement With Lenders CAREFREE WILLOWS: Wants to Use Cash Collateral; Lender Objects CENTAUR LLC: Valley View Downs L/C Extended Until January CHRISTIAN WHITTINGTON: Case Summary & Creditors List CIRCUIT CITY: No Class Claims Under Liquidation Plan CONTECH CONSTRUCTION: Completes "Balance Sheet Restructuring" CIT GROUP: DBRS Keeps 'B' Issuer Rating After Q3 Results CLYDE DAVIS: Case Summary & 14 Largest Unsecured Creditors CLYDE WILLIAMS: Case Summary & 5 Largest Unsecured Creditors CONTINENTAL COMMON: Voluntary Chapter 11 Case Summary CONTINENTAL TRUSTEES: S&P Assigns 'BB' Rating to $200 Mil. Notes CREAM MINERALS: Lender's Forbearance Conditioned on Minco Deal CROWN CASTLE: Fitch Upgrades Issuer Default Rating to 'BB' DANMART PROPERTIES: Voluntary Chapter 11 Case Summary DAVID MARCOE: Wants Access to Lenders' Cash Collateral DELTA AIR: Court OKs Sharing of Info. on Retiree Benefit Plans DELTA AIR: Reports $929 Million Profit in Sept. 30 Quarter DELTA AIR: Seeks Final Decree Closing Chapter 11 Cases DYNAVAX TECHNOLOGIES: Prices Public Offering of Shares at $1.70 DYNEGY INC: Asks Stockholders to Vote in Favor of Merger EMIVEST AEROSPACE: RB Capital DIP Financing Approved on Interim ENRON CORP: ECRC Files 24th Post-Confirmation Report ENRON CORP: Fraud Claims v. J. Brown Dismissed by District Judge ENRON CORP: Prosecutor Wants Loopholes on Skilling Ruling Fixed FRAC TECH: Moody's Assigns 'B1' Corporate Family Rating GARLOCK SEALING: Asbestos Trust Fights Move for Victims' Info GAS CITY: Asks Court to Extend Filing of Schedules by 45 Days GAS CITY: Section 341(a) Meeting Scheduled for December 1 GAS CITY: Lenders Object to Proposal to Get US$2.2MM Financing GAS CITY: Taps Proskauer Rose as Bankruptcy Counsel GLOBAL AUTOCARE: S&P Gives Negative Outlook, Affirms 'B' Rating GYMBOREE CORP: S&P Assigns 'B+' Corporate Credit Rating HARRISBURG, PA: Misses Nov. 1 Debt Payment; to Skip December Dues HELIX BIOPHARMA: Posts C$14.5 Million Net Loss in Fiscal 2010 HONOLULU SYMPHONY: Reaches Settlement with Musicians' Union HYDROGENICS CORP: Hosts Third Quarter Conference Call November 10 HYUN UM: Files Schedules of Assets and Liabilities HYUN UM: Taps Crocker Law to Handle Reorganization Case HYUN UM: U.S. Trustee Forms Three-Member Creditors Committee I-10 BARKER: U.S. Trustee Unable to Form Creditors Committee INNKEEPERS USA: Wants Plan Filing Exclusivity Until March 16 INTELLIPHARMACEUTICS INT'L: Gets Non-Compliance Notice From NASDAQ J & J CONSTRUCTION: U.S. Trustee Wants Case Converted to Chapter 7 JOHN KONECNIK: Has Until December 22 to Propose Chapter 11 Plan JOHN YEDINAK: Case Summary & 20 Largest Unsecured Creditors JULIUS JOHNSON: Case Summary & 20 Largest Unsecured Creditors KINGSWAY FINANCIAL: AM Best Affirms 'B-' Financial Strength Rating KORI PAGE: Case Summary & 10 Largest Unsecured Creditors LAKEVIEW AT CAROLINA: Reorganization Case Converted to Chapter 7 LAS VEGAS MONORAIL: District Judge Affirms Right to File Ch. 11 LAWRENCE HERRERA: Case Summary & 14 Largest Unsecured Creditors LEHMAN BROTHERS: Bankr. Court Approves Danske Bank Settlement LEHMAN BROTHERS: Caixa Wins Approval to Assign Interest in Note LEHMAN BROTHERS: Taps Wollmuth as Counsel for Avoidance Suits LEHMAN BROTHERS: UP Recovery Seeks Immediate Claim Payment LOEHMANN'S INC: Said to be Preparing Prepackaged Bankruptcy M&T BANK: Wilmington Trust Deal Cues Moody's Rating Reviews MAGIC BRANDS: Seeks More Time to Finalize Liquidation Plan MARK LOWRY: Case Summary & 6 Largest Unsecured Creditors MARSHALL GROUP: Plan of Reorganization Wins Court Approval MCKESSON CORP: US Oncology Deal Cues Moody's to Keep 'Ba1' Rating MEADOWS OF JUPITER: Case Summary & 20 Largest Unsecured Creditors MERUELO MADDUX: Opposes Equityholders' Plea to Delay Voting MOOG INC: Moody's Changes Outlook to Stable, Affirms 'Ba2' Rating NON-INVASIVE MONITORING: Morrison Brown Raises Going Concern NORTH COAST: A.M. Best Assigns 'C+' Financial Strength Rating NPC INTERNATIONAL: Moody's Affirms 'B2' Corporate Family Rating NUTRACEA: Plan of Reorganization Approved by Bankruptcy Court NY TIMES: Moody's Assigns 'B1' Rating to $200 Mil. Senior Notes NY TIMES: S&P Rates $200M Rule 144A Senior Notes at 'B+' OMNICITY CORP: Files Amendment No. 2 to Fiscal 2010 Q1 Report OMNICITY CORP: Filing of July 31 Annual Report to be Delayed OTC HOLDINGS: To Present Plan for Confirmation on Dec. 14 PACIFICHEALTH LABORATORIES: Posts $87,400 Net Loss in Q3 2010 POINT BLANK: Class-Action Plaintiffs Protest Bid's to Reject Deal RASER TECHNOLOGIES: Makes $2.2MM Semi-Annual Interest Payment RASER TECHNOLOGIES: Trades Under OTCBB Today After NYSE Delisting REDCO DEVELOPMENT: Can Use Sterling Savings' Cash Collateral REDCO DEVELOPMENT: U.S. Trustee Unable to Form Creditors Committee RICHARD MILSNER: Case Summary & Largest Unsecured Creditor ROOFING SUPPLY: Moody's Assigns 'B2' Corporate Family Rating ROYAL HOSPITALITY: Can Hire Hodgson Russ as Bankruptcy Counsel RURAL/METRO OPERATING: Moody's Puts 'B2' Rating on $200 Mil. Notes SONRISA PROPERTIES: Hearing for Compass Plan Outline on Nov. 16 SPECIALTY PRODUCTS: Asbestos Trust Fights Move for Victims' Info STEPHANIE SERPA: Bank of America Says No to Cash Collateral Use SUNESIS PHARMCEUTICALS: Posts $5.1 Million Net Loss in Q3 2010 SUNGARD DATA: Moody's Assigns 'Caa1' Rating to $500 Mil. Notes SUNGARD DATA: Fitch Assigns 'B-/RR5' Rating to $500 Mil. Notes SUNGARD DATA: S&P Assigns 'B' Rating on Senior Unsecured Debt SYNIVERSE TECHNOLOGIES: Carlyle Deal Won't Affect Moody's Ratings TAYLOR BEAN: Plan Partly Pays $8 Billion in Claims TERRESTAR NETWORKS: Proposes Dec. 11 Claims Bar Date TERRESTAR NETWORKS: Sec. 341 Meeting Set for November 10 TERRESTAR NETWORKS: U.S. Trustee Names 7 to Creditors Committee THE UNION CREDIT UNION: NCUA Names Liquidating Agent TRANSDIGM INC: Moody's Confirms Corporate Family Rating at 'B1' TRANSDIGM INC: S&P Affirms 'B+' Corporate Credit Rating TRONOX INC: Wins Approval of $125MM Exit Loans from Wells Fargo TROPICANA ENTERTAINMENT: Lenders Seek to Cut Final Fees ULTIMATE ESCAPES: Selling Properties to Three Buyers UNI-PIXEL INC: Posts $1.5 Million Net Loss in September 30 Quarter UNION CARBIDE: Moody's Ups Ratings on Debentures to Baa3 From Ba2 UNITED WESTERN: Inks Oak Hill Investment Deal & JPM Forbearance UNIVERSITY CITY: S&P Gives Positive Outlook, Affirms 'B' Rating UNIVISION COMMUNICATIONS: S&P Raises Corp. Credit Rating to 'B' US DATAWORKS: Appoints Grant Thornton as New Independent Auditors US ONCOLOGY: Moody's Puts Ratings Under Review for Possible Raise US AIRWAYS: Reports $250 Million Net Profit in Third Quarter US AIRWAYS: Updates on Financial Outlook for 2010 US AIRWAYS: Wants B. Mitchell Adversary Proceeding Stayed VAN CHASE: U.S. Trustee Unable to Form Creditors Committee VERTIS HOLDINGS: Amends Terms for Comprehensive Recapitalization VINEYARD CHRISTIAN: Ch. 11 Trustee Wants Case Converted to Ch. 7 VITRO SAB: To File for Bankr. in Mexico, Chapter 15 in U.S. WILLARD FRAZIER: Case Summary & 18 Largest Unsecured Creditors WILMINGTON TRUST: S&P Puts 'BB+/B' Rating on Watch Positive ZIONS BANCORP: Moody's Downgrades Bank Deposit Rating to Ba3 * Upcoming Meetings, Conferences and Seminars ********* ADVANTA CORP: Files Plan; Unsecureds to See 37%-71% Recovery ------------------------------------------------------------ Advanta Corp. disclosed that it, together with certain of its subsidiaries, filed a Debtors' Joint Plan under chapter 11 of the United States Bankruptcy Code and a Disclosure Statement related to the Plan. The Plan and Disclosure Statement have been approved by the Debtors' Boards of Directors and are subject to the approval of the bankruptcy court. Among other things, the Disclosure Statement provides projections for the approximate percentage recovery rates for claims against Advanta including a recovery range of 64.4% to 100.0% for Investment Note claims and RediReserve Certificate claims, and a recovery range of 37.7% to 71.3% for General Unsecured claims against the Consolidated Debtors, as defined in the Plan. As previously disclosed, the Debtors anticipate that there will be no distributions to the preferred or common stockholders of Advanta Corp. nor continuing interest in Advanta Corp. (or any of the trusts formed under the Plan) on the part of the preferred or common stockholders. This beneficial result for creditors comes about for a number of reasons including the fact that: The Company placed itself in bankruptcy at a time when it had approximately $100 million in cash and equivalents enabling it to preserve cash for creditors rather than having it dissipated. The Company was able to file its tax returns in a way that in combination with the successful resolution of ensuing litigation reduced a claim by the FDIC relating to Advanta Bank Corp. from $170 million to between zero and $50 million and provides for a potential recovery for the Company of $5 million. The Company was able to preserve assets as a result of successful litigation with the FDIC involving another banking subsidiary, Advanta Bank; and, the Company was able to secure control and transition servicing of a portfolio of credit card receivables that it owns. "Because of these actions, Investment Note holders and RediReserve certificate holders, who are our largest group of creditors, could potentially recover all of their investment which has been a key goal of ours in these otherwise unfortunate circumstances," said Dennis Alter, Chairman and CEO. The bankruptcy court is scheduled to consider approval of the Disclosure Statement in December 2010. Once approved, the Plan will be sent to eligible creditors for voting. The Company anticipates approval of the Plan sometime in early 2011. About Advanta Corp. Advanta Corp. -- http://www.advanta.com/-- has had a 59-year history of being a leading innovator in the financial services industry and of providing great value to its stakeholders, including its senior retail note holders and shareholders, prior to the recent reversals. It has also been a major civic and charitable force in the communities in which it is based, particularly in the Greater Philadelphia area. In June 2009, the Federal Deposit Insurance Corporation placed significant restrictions on the activities and operations of Advanta Bank Corp., a wholly owned subsidiary of the Company, as the Bank's capital ratios were below required regulatory levels. On November 8, 2009, Advanta Corp. filed for Chapter 11 (Bankr. D. Del. Case No. 09-13931). Attorneys at Weil, Gotshal & Manges LLP, and Richards, Layton & Finger, P.A., serve as bankruptcy counsel. Alvarez & Marsal serves as financial advisor. The Garden City Group, Inc., serves as claims agent. The filing did not include Advanta Bank Corp. The petition says that Advanta Corp.'s assets totaled $363,000,000 while debts totaled $331,000,000 as of September 30, 2009. ALMATIS B.V.: Bankr. Professionals File Final Fee Applications -------------------------------------------------------------- Eleven professionals retained in the Chapter 11 cases of Almatis B.V. and its affiliated debtors filed fee applications, seeking final payment of fees for their services and reimbursement of expenses. The professionals and the fees and expenses they seek are: Professional Fee Period Fees Expenses ------------ ---------- ---- -------- Butzel Long 06/25/10 to US$29,552 US$1,709 09/20/10 DC Advisory Partners Ltd. 04/30/10 to US$5,500,925 US$48,377 09/20/10 De Brauw Blackstone 04/30/10 to EUR1,998,852 EUR8,849 Westbroek N.V. 09/20/10 Ernst & Young GmbH 04/30/10 to EUR266,658 - 09/20/10 Ernst & Young 04/30/10 to US$724,231 US$0 Belastingadviseurs LLP 09/20/10 Gibson Dunn & Crutcher 04/30/10 to GBP3,511,720 GBP88,240 09/20/10 Linklaters LLP 04/30/10 to GBP1,323,611 GBP10,748 09/20/10 Moelis & Company LLC 04/30/10 to US$450,000 $33,580 09/20/10 Schultze & Braun GmbH 04/30/10 to EUR103,433 - Rechtsanwaltsgesellschaft 09/20/10 Schultze & Braun GmbH 04/30/10 to EUR396,421 EUR858 Rechtsanwaltsgesellschaft 09/20/10 WirtschaftsprUfungsgesellschaft Talbot Hughes McKillop 04/30/10 to GBP937,324 BP178,091 09/20/10 Gibson Dunn is the Debtors' legal counsel and Talbot Hughes is the Debtors' cash management adviser. De Brauw, Butzel and Linklaters serve as special counsel to the Debtors. Moelis & Company is investment banker to the Debtors. DC Advisory acts as the Debtors' financial adviser. The firms of Ernst & Young were employed as the Debtors' tax advisers. The firms of Schultze & Braun provided legal advice to the directors of the Almatis companies in Germany and opinion on the restructuring of their businesses. The Court is set to convene a hearing on November 10, 2010, to consider approval of the Final Fee Applications. About Almatis Group Almatis B.V., operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Almatis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion in its petition. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. The Debtors' reorganization plan was declared effective on September 30, 2010, allowing the Debtors to fully complete their financial restructuring and emerge from Chapter 11 protection. The Almatis restructuring plan took effect a week after it was confirmed by Bankruptcy Judge Martin Glenn for the Southern District of New York. ALMATIS B.V.: Files Bankruptcy Closing Report --------------------------------------------- Almatis B.V. and its affiliated debtors filed with the U.S. Bankruptcy Court for the Southern District of New York a closing report on October 15, 2010, disclosing that they have paid a total of $3.982 million to Gibson Dunn & Crutcher LLP for its fees. Gibson Dunn served as the Debtors' bankruptcy counsel during the pendency of their Chapter 11 cases. The Debtors also disclosed that they paid a total of $8.915 million for the fees and expenses incurred by various other professionals which they employed during the pendency of their bankruptcy cases. The Debtors may be required to make additional payments in the event the Bankruptcy Court determines that Gibson Dunn and the other professionals are entitled to fees in an amount greater than the amount already paid, according to the report. The hearing to determine the professionals' fees on a final basis is scheduled for November 10, 2010. The Debtors further reported that they have consummated the transactions necessary to implement their restructuring plan as well as the distributions required to be made on September 30, 2010, the effective date of the restructuring plan. Details of the transactions that were consummated to implement the terms of the restructuring plan are contained in an implementation memorandum, a copy of which is available for free at http://bankrupt.com/misc/Almatis_ImplementationMemo.pdf The Debtors' reorganization plan was declared effective on September 30, 2010, allowing the Debtors to fully complete their financial restructuring and emerge from Chapter 11 protection. The Almatis restructuring plan took effect more than a week after it was confirmed by Bankruptcy Judge Martin Glenn for the Southern District of New York. About Almatis Group Almatis B.V., operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Almatis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion in its petition. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. ALTACANADA ENERGY: May Face Receivership if Planned Sale Fails -------------------------------------------------------------- AltaCanada Energy Corporation said Monday it obtained an extension of the fourth Amended and Extended Forbearance Agreement with National Bank on October 29, 2010. The deal includes consent to a receivership order that the Bank could exercise if the Company's strategic process is not successful in the Bank's discretion. AltaCanada said the Bank may make that decision on November 2, 2010. AltaCanada commenced a strategic sales process with CIBC World Markets in September to either sell AltaCanada, find suitable merger candidates, or locate investment capital to reorganize the Company. Proposals were due on November 2. The Company said 111 companies have been contacted through this process. "We have no assurance that the Bank will continue to provide financing. The Bank has cooperated with Alta Canada in permitting the Company to proceed with the current drilling program," the Company said. Based in Calgary, Alberta, AltaCanada Energy Corporation -- http://www.altacanada.com/-- is engaged in the acquisition, exploitation and production of crude oil and natural gas reserves in Western Canada and Montana. AMEGY BANK: Moody's Cuts Issuer Rating to B1 From Ba3 ----------------------------------------------------- Moody's Investors Service announced that it has downgraded the ratings of 10 large U.S. regional banks after reducing its government support assumptions for these entities. The affected entities, whose ratings were placed on review for possible downgrade on July 27, 2010, had benefited from Moody's support assumptions since 2009. The banks affected by this action are subsidiaries of these 10 holding companies, listed alphabetically. This list includes the current bank-level deposit ratings following the removal of support. * BB&T Corporation -- bank deposits to Aa3 from Aa2 * Capital One Financial Corporation -- bank deposits to A3 from A2 * Fifth Third Bancorp -- bank deposits to A3 from A2 * KeyCorp -- bank deposits to A3 from A2 * PNC Financial Services Group, Inc. -- bank deposits to A2 from A1 * Popular, Inc. -- bank deposits to Baa3 from Baa2 * Regions Financial Corporation -- bank deposits to Baa3 from Baa1 * SunTrust Banks, Inc. -- bank deposits to A3 from A2 * U.S. Bancorp -- bank deposits to Aa2 from Aa1 * Zions Bancorporation -- bank deposits to Ba3 from Ba2 Additionally, as a result of the reduced support assumptions, the ratings outlook on the subsidiaries of American Express Company was changed. These issuers' guaranteed debt obligations issued under the FDIC's TLGP program were unaffected by the actions and remain Aaa. Rating Rationale "The downgrades reflect Moody's view that the likelihood of government support for these 10 institutions is lower now that the U.S. banking system has moved beyond the depths of the financial crisis," said Robert Young, Managing Director for Moody's North American Bank Ratings. "The failure of any one of these banks therefore would be unlikely to trigger contagion and systemic risk." In passing the Dodd-Frank Wall Street Reform and Consumer Protection Act this summer, the government signaled its intent to limit support for individual banks. This contrasts with its stance in early 2009, when it stated that support would be forthcoming for large regional banks that could not raise sufficient capital to satisfy government requirements under the Supervisory Capital Assessment Program. In reviewing its support assumptions, Moody's took into account the government's existing TARP investments in six large regional banks (Fifth Third, KeyCorp, Popular, Regions, SunTrust, and Zions). "Although the TARP investments are significant, all of these banks are currently devising plans to repay the government and are unlikely to keep the TARP in place over the long term," Young noted. The probability that the government would support any one of these institutions through a TARP conversion is therefore limited. Specific Bank Actions Differ BB&T: Moody's removed its assumption of support and placed BB&T's long-term ratings on review for further downgrade. During its review of BB&T's stand-alone credit strength, Moody's will focus on BB&T's ability to maintain its core pre-provision, pre-tax earnings in a still-challenging environment for U.S. banks, while assessing the risks associated with its above-average loan growth outside of commercial real estate as it shifts its portfolio away from that troubled asset class. Moody's will also consider the likely pace of further reductions in BB&T's sizable portfolio of foreclosed properties. In the event of a downgrade, a one-notch reduction is most likely. Were this to occur, BB&T's ratings would remain comparatively high, particularly among its Southeastern and large regional bank peers. Its senior holding company obligations are currently rated A1 and its long-term bank deposits (after the removal of systemic support) are rated Aa3. BB&T's Prime-1 short-term ratings, at both the bank and the holding company, are affirmed and are not on review. SunTrust: The downgrade resulting from the removal of systemic support assumptions was tempered by Moody's upgrade of SunTrust's stand-alone bank financial strength rating to C from C-. The combination of these two actions resulted in most of the holding company's ratings being confirmed (senior debt, Baa1), except for the preferred stock ratings, which were notched off the BFSR and were therefore upgraded with the BFSR (non-cumulative preferred to Ba1 from Ba2). However, the combination of the removal of systemic support assumptions and the upgrade of the BFSR did lead to a one-notch downgrade of the ratings on SunTrust Bank (long- term deposit rating to A3 from A2; short-term rating to Prime-2 from Prime-1). Following these rating actions, the outlook on all of SunTrust's ratings is stable. Regions: The removal of support assumptions resulted in a two- notch downgrade of Regions' bank-level debt and deposit ratings (long-term deposit rating to Baa3 from Baa1; short-term rating to Prime-3 from Prime-2) and a one-notch downgrade of the holding company's ratings (senior debt to Ba1 from Baa3; short-term rating to Not-Prime from Prime-3). Following these actions, the outlook on all of Regions' ratings remains negative. Capital One, Fifth Third, KeyCorp, Zions: The removal of support assumptions resulted in a one-notch downgrade of these four banks' bank-level debt and deposit ratings, but did not affect any of the holding companies' ratings, which were not on review. PNC, Popular, U.S. Bancorp: Moody's continues to ascribe support in the case of these three banks, but at a reduced level. The reduction in the support assumption resulted in a one-notch downgrade of these banks' bank-level debt and deposit ratings. The ratings of these entities' holding companies were not on review and were affirmed at their current level. While the lower probability of support does not provide any lift to their current stand-alone ratings, at a lower stand-alone rating some ratings lift might result. The ongoing assumption of support for US Bancorp and PNC is due primarily to their importance in the payment system and their significant national deposit share. The support assumption for Popular reflects its dominant position in Puerto Rico, together with that island's physical isolation and political importance. Rating Outlooks The rating outlook on four of these banks did not change. The outlook on Regions, Popular, and U.S. Bancorp remains negative, while that on Zions remains positive. However, the ratings outlook on six of the banks did change. On Capital One, Fifth Third, and KeyCorp it was changed to stable from negative; on PNC it was changed to positive from stable; and on SunTrust it was changed to stable after the upgrade discussed above. "These outlook changes reflect the banks' improving credit metrics and strengthened capital profiles relative to Moody's previous expectations, particularly at PNC and SunTrust," said Allen Tischler, Moody's Vice President and Lead Analyst for Fifth Third, KeyCorp, SunTrust, and PNC. Finally, the rating outlook on American Express Company's subsidiaries was changed to negative from stable as a result of the removal of the support assumption. The last rating action on BB&T Corporation, Capital One Financial Corporation, Fifth Third Bancorp, KeyCorp, PNC Financial Services Group, Inc., Popular, Inc., Regions Financial Corporation, SunTrust Banks, Inc., and U.S. Bancorp was on July 27, 2010, when Moody's placed on review for possible downgrade all the ratings that had benefited from systemic support at these banks. The last rating action on Zions Bancorporation and its subsidiaries was on August 3, 2010, when Moody's changed the rating outlook on the unsupported ratings of Zions Bancorporation and its subsidiaries to positive from negative, including those of its lead bank, Zions First National Bank. The last rating action on American Express Company was on February 17, 2010, when Moody's downgraded the ratings on certain U.S. banks' hybrid securities, in line with its revised Guidelines for Rating Bank Hybrids and Subordinated Debt, published in November 2009. Downgrades: Issuer: BB&T Financial, FSB -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: Banco Popular de Puerto Rico -- Issuer Rating, Downgraded to Baa3 from Baa2 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa2 Issuer: Branch Banking and Trust Company -- Issuer Rating, Downgraded to Aa3 from Aa2 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa3 from Aa2 -- Multiple Seniority Bank Note Program, Downgraded to a range of A1 to Aa3 from a range of Aa3 to Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to A1 from Aa3 -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: SunTrust Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3 from a range of (P)P-1, (P)A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Fifth Third Bank, Ohio -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to P-2 from P- 1 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: KeyBank National Association -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Multiple Seniority Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3, (P)Baa1 from a range of (P)P-1, (P)A2, (P)A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to a range of A3 to P-2 from a range of A2 to P-1 -- Senior Unsecured Deposit Program, Downgraded to P-2, A3 from P-1, A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: National City Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 Issuer: National City Bank of Indiana -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Kentucky -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Pennsylvania -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: PNC Bank, N.A. -- Issuer Rating, Downgraded to A2 from A1 -- OSO Senior Unsecured OSO Rating, Downgraded to A2 from A1 -- Multiple Seniority Bank Note Program, Downgraded to a range of A2, A3 from a range of A1, A2 -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Bank Note Program, Downgraded to A2 from A1 -- Senior Unsecured Medium-Term Note Program, Downgraded to (P)A2 from (P)A1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 -- Senior Unsecured Deposit Rating, Downgraded to A2 from A1 Issuer: Provident Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: U.S. Bank National Association -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Aa2, Aa3 from a range of Aa1, Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to Aa3 from Aa2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: U.S. Bank National Association ND -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: Capital One Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of P-2, A3, Baa1 from a range of P-1, A2, A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Capital One, N.A. -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: AmSouth Bancorporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 Issuer: AmSouth Bank -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Regions Bank -- Issuer Rating, Downgraded to Baa3 from Baa1 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Ba1 to P-3 from a range of Baa2 to P-2 -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa1 Issuer: Regions Financial Corporation -- Issuer Rating, Downgraded to a range of NP, Ba1 from a range of P-3, Baa3 -- Multiple Seniority Shelf, Downgraded to a range of (P)Ba3 to (P)Ba1 from a range of (P)Ba2 to (P)Baa3 -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Subordinate Shelf, Downgraded to (P)Ba2 from (P)Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Regions Financing Trust II -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 -- Preferred Stock Shelf, Downgraded to (P)Ba3 from (P)Ba2 Issuer: Regions Financing Trust III -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 Issuer: Union Planters Bank, National Association -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Union Planters Corporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Amegy Bank National Association -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: California Bank & Trust -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Nevada State Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Zions First National Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Upgrades: Issuer: SunTrust Bank -- Bank Financial Strength Rating, Upgraded to C from C- Issuer: SunTrust Banks, Inc. -- Multiple Seniority Shelf, Upgraded to (P)Baa3 from (P)Ba1 -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Preferred Capital I -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Real Estate Investment Corporation -- Preferred Stock Preferred Stock, Upgraded to Baa3 from Ba1 On Review for Possible Downgrade: Issuer: BB&T Capital Trust I -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust II -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust IV -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust V -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VI -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VII -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VIII -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Corporation -- Issuer Rating, Placed on Review for Possible Downgrade, currently A1 -- Multiple Seniority Medium-Term Note Program, Placed on Review for Possible Downgrade, currently a range of (P)A2, (P)A1 -- Multiple Seniority Shelf, Placed on Review for Possible Downgrade, currently a range of (P)A3 to (P)A1 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A2 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 Issuer: BB&T Financial, FSB -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Issuer: Branch Banking and Trust Company -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Issuer Rating, Placed on Review for Possible Downgrade, currently Aa3 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Multiple Seniority Bank Note Program, Placed on Review for Possible Downgrade, currently a range of A1 to Aa3 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Outlook Actions: Issuer: American Express Travel Related Svcs Co., Inc -- Outlook, Changed to Negative From Stable Issuer: American Express Centurion Bank -- Outlook, Changed to Negative From Stable Issuer: American Express Bank, FSB -- Outlook, Changed to Negative From Stable Issuer: American Express Credit Corporation -- Outlook, Changed to Negative From Stable Issuer: BB&T Capital Trust I -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust II -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust IV -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust V -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VI -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VIII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Corporation -- Outlook, Changed To Rating Under Review From Negative Issuer: Banco Popular de Puerto Rico -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Financial Corporation -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital II -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital III -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital IV -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital V -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital VI -- Outlook, Changed to Stable from Negative Issuer: North Fork Capital Trust II -- Outlook, Changed to Stable from Negative Issuer: Hibernia Corporation -- Outlook, Changed to Stable from Negative Issuer: National Commerce Capital Trust I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Banks, Inc. -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital IX -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital VIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital X -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Preferred Capital I -- Outlook, Changed To Stable From Negative Issuer: SunTrust Real Estate Investment Corporation -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Bank, Ohio -- Outlook, Changed To Stable From Rating Under Review Issuer: Fifth Third Bancorp -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust II -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust IV -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust V -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VI -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VII -- Outlook, Changed To Stable From Negative Issuer: KeyBank National Association -- Outlook, Changed To Stable From Rating Under Review Issuer: KeyCorp -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital I -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital II -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital III -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital V -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VI -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VIII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital IX -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital X -- Outlook, Changed To Stable From Negative Issuer: National City Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Indiana -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Kentucky -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Pennsylvania -- Outlook, Changed To Positive From Rating Under Review Issuer: PNC Bank, N.A. -- Outlook, Changed To Positive From Rating Under Review Issuer: Provident Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Preferred Capital Trust I -- Outlook, Changed To Positive From Stable Issuer: Merchants National Corp -- Outlook, Changed To Positive From Stable Issuer: National City Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust C -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust D -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust E -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust F -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust G -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust H -- Outlook, Changed To Positive From Stable Issuer: PNC Funding Corporation -- Outlook, Changed To Positive From Stable Issuer: Mercantile Bankshares Corporation -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust II -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust III -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust IV -- Outlook, Changed To Positive From Stable Issuer: National City Credit Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Financial Services Group, Inc. -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust I -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust II -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust III -- Outlook, Changed To Positive From Stable Issuer: U.S. Bank National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: U.S. Bank National Association ND -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: Capital One, N.A. -- Outlook, Changed To Stable From Rating Under Review Issuer: AmSouth Bancorporation -- Outlook, Changed To Negative From Rating Under Review Issuer: AmSouth Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financial Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust II -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust III -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Bank, National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Amegy Bank National Association -- Outlook, Changed To Positive From Rating Under Review Issuer: California Bank & Trust -- Outlook, Changed To Positive From Rating Under Review Issuer: Nevada State Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: Zions First National Bank -- Outlook, Changed To Positive From Rating Under Review Confirmations: Issuer: National Commerce Capital Trust I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Banks, Inc. -- Issuer Rating, Confirmed at Baa1 -- Multiple Seniority Shelf, Confirmed at (P)Baa3, (P)Baa2, (P)Baa1 -- Subordinate Regular Bond/Debenture, Confirmed at Baa2 -- Senior Unsecured Regular Bond/Debenture, Confirmed at Baa1 Issuer: SunTrust Capital I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital IX -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital VIII -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital X -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVII -- Preferred Stock Shelf, Confirmed at (P)Baa3 The principal methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, and Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007. AMERICAN ACHIEVEMENT: Moody's Upgrades Corp. Family Rating to 'B3' ------------------------------------------------------------------ Moody's Investors Service upgraded American Achievement Group Holding Corp.'s corporate family rating to B3 from Caa1 and probability of default rating to B3 from Caa2 following the successful refinancing of the company's capital structure. Moody's has also assigned a B3 rating to the $365 million of American Achievement Corporation's senior secured notes with a coupon of 10.875%. These rating actions conclude the review for possible upgrade initiated on October 18, 2010. The rating outlook is stable. Given the changes to American Achievement's capital structure, the CFR and PDR ratings are transferred from America Achievement Group Holdings to American Achievement Corporation. Ratings Rationale Importantly, the new capital structure extends AAC's maturity profile to 2015 and provides good covenant protection, particularly in regard to potential de-capitalization by the shareholder. In addition, the B3 rating reflects AAC's small scale, still high leverage, modest interest coverage and, in Moody's view, the potential for limited free cash flow over the next 18 months balanced by its sizable market position in the relatively stable school ring and yearbook space, attractive operating margins and the expectation of de-leveraging through EBITDA growth. Ratings upgraded: American Achievement Corporation: -- Corporate Family Rating to B3 from Caa1 -- Probability of Default Rating to B3 from Caa2 Rating Assigned: -- $365 million senior secured notes at B3 (LGD-4, 57%) Ratings Withdrawn: American Achievement Group Holding Corp.: -- Senior PIK notes due 2012 at Caa3 AAC Group Holding Corp. -- $132 million Senior discount notes due 2012 at Caa2 American Achievement Corporation: -- $150 million senior subordinated notes due 2012 at B2 -- $40 million senior secured revolving credit facility due 2010 at B1 -- $70 million senior secured term loan due 2011 at B1 The stable outlook incorporates Moody's view that AAC will improve its operating performance despite the weak economic environment. The stable outlook incorporates the expectation of EBITDA expansion given the company's investment in new productivity initiatives, enhancement to the brands and improvement in the distribution channels. Positive momentum of AAC's rating is expected to be driven by growth in the top line leading to a reduction in leverage to under 6 times debt-to-EBITDA alongside generation of free cash flow (at least 5% FCF-to-debt). Ongoing pressure on the top line and weakening of EBITDA margins could put negative pressure on the corporate family rating. Moody's would consider a negative action should AAC not de-lever as expected and/or fail to generate free cash flow by the end of next year. Headquartered in Austin, Texas, American Achievement Corporation is a leading provider of school-related affinity products and services. The company holds strong market shares in each of its product segments -- yearbooks, class rings, and graduation products. Revenues for the fiscal year ended were approximately $293-295 million. AAC is owned by the private equity firm, Fenway Partners, LLC. AMERICAN APPAREL: Posts $14.7 Million Net Loss in June 30 Quarter ----------------------------------------------------------------- American Apparel, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $14.7 million on $132.7 million of revenue for the three months ended June 30, 2010, compared with net income of $4.5 million on $136.1 million of revenue for the same period last year. The Company incurred a loss from operations of $8.6 million for the three months ended June 30, 2010, as compared to income from operations of $7.4 million for the same period last year. The Company's balance sheet at June 30, 2010, showed $312.7 million in total assets, $212.9 million in total liabilities, and stockholders' equity of $99.8 million. American Apparel discloses that as of June 30, 2010, it was in compliance with all required covenants of the revolving credit facility of $75,000,000 with Bank of America, N.A., and the $80,000,000 term loan agreement with Lion Capital LLP. However, as of June 30, 2010, the Company was not in compliance with the covenant under the C$11,000,000 credit agreement with Bank of Montreal, which required furnishing audited financial statements of American Apparel's Canadian operations to Bank of Montreal within 120 days after December 31, 2009. American Apparel also stated in the Form 10-Q, "The Company incurred a substantial loss from operations and had negative cash flows from operating activities for the six months ended June 30, 2010. Based upon results of operations for the six months ended June 30, 2010, and through the issuance date of these financial statements and projected for the remainder of 2010, the Company may not have sufficient liquidity necessary to sustain operations for the next twelve months. The Company's current operating plan indicates that losses from operations are expected to continue through at least the third quarter of 2010. The Company believes that it is probable that beginning January 31, 2011, the Company will not be in compliance with the minimum Consolidated EBITDA covenant under the Lion Credit Agreement." "Noncompliance with covenants under the Lion Credit Agreement constitutes an event of default under the BofA Credit Agreement, which, if not waived, could block the Company from making borrowings under the BofA Credit Agreement. In addition, all indebtedness under the BofA Credit Agreement and the Lion Credit Agreement could be declared immediately due and payable." The Company believes the foregoing factors, among others, raise substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6d42 About American Apparel Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP) -- http://www.americanapparel.com/-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel. At June 30, 2010, the Company operated a total of 279 retail stores in the United States, Canada and 18 other countries. AMERICAN INT'L: Raises $37 Billion to Repay U.S. Government ----------------------------------------------------------- American International Group, Inc., on Monday said it has raised nearly $37 billion to repay the United States government through its sale of one insurance subsidiary, American Life Insurance Company, and the initial public offering of a second, AIA Group Limited. AIG on Monday closed the sale of ALICO to MetLife, Inc., for approximately $16.2 billion, including approximately $7.2 billion in cash and the remainder in MetLife securities. The $7.2 billion cash portion of the consideration includes an upward purchase price adjustment of approximately $400 million pursuant to the terms of the purchase agreement between MetLife and AIG. On October 22 and 29, respectively, AIG disclosed in regulatory filings that the gross proceeds from the initial public offer of AIA were $17.8 billion and the exercise of the over-allotment option for the offering increased the gross proceeds to $20.51 billion. Together, the AIA and ALICO transactions raised approximately $36.71 billion, $27.71 billion of which was in cash proceeds. AIG expects to use the cash proceeds from the ALICO and AIA transactions to repay the credit facility extended to AIG by the Federal Reserve Bank of New York and to make payments on other interests owned by the government, under terms of the Agreement in Principle announced by AIG as part of its recapitalization plan on September 30, 2010. The MetLife securities will be sold over time, subject to certain lock-up provisions and market conditions, to provide additional funds to repay the government. "We promised the American taxpayers we would repay them and the initial public offering of AIA last week and the completion of the ALICO transaction move us closer to delivering on our promise," said Robert H. Benmosche, AIG President and Chief Executive Officer. "These transactions will generate sufficient cash to allow AIG to pay off the FRBNY credit facility, marking a major milestone in our commitment to repay the American taxpayers." Proceeds from the transactions are being placed in an escrow fund with the FRBNY until the closing of the recapitalization plan, expected no later than the first quarter of 2011. As of October 27, 2010, the principal and interest owed to the FRBNY on the credit facility was approximately $20 billion. "As we said on September 30, AIG will restructure itself around its core property casualty and life and retirement services businesses, which are performing well, and will provide our company with a strong foundation to build value for all stakeholders going forward," Mr. Benmosche said. 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. AMERIGAS PARTNERS: Fitch Affirms 'BB+' Issuer Default Rating ------------------------------------------------------------ Fitch Ratings has affirmed the Issuer Default Ratings and outstanding debt ratings for AmeriGas Partners, L.P.'s and Amerigas Finance Corp. and AP Eagle Finance Corp., co-issuers of certain of APU's outstanding notes. The Rating Outlooks have been revised to Positive from Stable. About $868 million of outstanding long-term debt is affected. Fitch affirms these ratings: AmeriGas Partners, L.P./Amerigas Finance Corp. -- IDR at 'BB+'; -- Senior unsecured at 'BB+'. AmeriGas Partners, L.P./AP Eagle Finance Corp. -- IDR at 'BB+'; -- Senior unsecured at 'BB+'. APU's ratings reflect the underlying strength of its retail propane distribution network, broad geographic reach, adequate credit metrics, and proven ability to manage unit margins under various operating conditions. Additionally, the company's growing Amerigas Cylinder Exchange propane cylinder exchange business provides modest positive cash flow during the summer months when the traditional space heating related propane distribution business is relatively slow. APU's ratings also consider the structural subordination of its debt obligations to revolver borrowings at AmeriGas Propane, LP, its operating limited partnership subsidiary. APU's financial performance remains sensitive to weather conditions and general customer conservation, and the company must continue to manage volatile supply costs and price-induced customer conservation. The recessionary economy and volatile price of propane, which is loosely correlated to the price of oil, has been exacerbating volume sales declines throughout the sector. These factors have the potential to lead to further customer conservation, increased bad debt expense, and could test APU's ability to sustain its current robust profit margins. Fitch notes sales volumes have declined for APU due in part to warmer than normal weather and continued general economic malaise. APU's retail volumes were down roughly 4.5% year-over-year for the nine month period ended June 30, 2010. APU is seeing volume declines in all of their customer segments, excepting ACE which has seen volume sales growth as the program continues to be rolled out to an increasing number of locations nationally. Management reports that volume declines are being driven by the most economically sensitive customer segments, which Fitch believes should start to see a modest rebound as the economy improves. Volume declines have been particularly pronounced in APU's forklift segment, consistent with reduced shipping volumes and inventory turns at big box retailers. However, management recently noted at APU's analyst day that forklift volumes have seen recent increases, providing some optimism heading into the holiday season when shipping and inventory turns tend to increase. APU has managed to effectively pass through propane supply cost increases on to customers and has consistently maintained and even grown gross margins during periods of volatile weather conditions and commodity price volatility over the past several years. As a result, APU has maintained fairly solid credit metrics. For the 12 months ended June 30, 2010, consolidated operating EBITDA-to- interest expense and total debt-to-operating EBITDA equaled 4.9 times and 2.7x, respectively. Absent large acquisitions, for fiscal years 2010 and 2011, Fitch estimates consolidated EBITDA- to-interest and debt-to-operating EBITDA equal to approximately 5.7x and 2.7x and 5.7x and 2.6x, respectively. The revision in Outlook is reflective of the underlying strength of APU's retail distribution network, broad geographic scope, conservative management practices, Fitch's expectations for continued margin stability and metric strength and the retirement of AGP's remaining outstanding first mortgage bonds. Overall, in recent years Fitch has largely viewed the retail propane sector business outlook to be moderately negative, stressing concerns over demand destruction due to fuel switching, price volatility and the impact of conservation. However, Fitch believes that APU management has exhibited its ability and intent to maintain a stable balance sheet and consistent credit metrics even in the face of varying market conditions and growth through acquisitions. APU has proven itself adept at managing its operating costs, distribution policies, and integrating acquisitions. As a result, APU has seen steady EBITDA growth, cash flow consistency and improved credit metrics over the past several years despite elevated sales volume and commodity price volatility. Should these results and practices continue Fitch could take a positive rating action. Any negative credit action would be driven by a variety of factors including margin deterioration, significant demand destruction, or a more aggressive distribution or acquisition policy which leads to increased leverage. Amerigas Propane, Inc., an indirect subsidiary of UGI Corp. owns an effective 44% interest in APU as the general partner and a limited partner. APU is a master limited partnership that conducts a national propane distribution business through its operating partnership subsidiary AGP and AGP's subsidiaries. The APU debt is co-issued with either of its special purpose financing subsidiaries AP Eagle Finance Corp. and AmeriGas Finance Corp. APU's liquidity is supported by a $200 million credit facility at AGP that includes a $125 million revolving credit facility and a $75 million acquisition facility (which may also be used for working capital purposes). AGP also has a $75 million supplemental credit facility that matures in June 2011. Fitch notes that the AGP's revolvers currently structurally subordinate APU long-term debt; however, there are currently no plans for issuing any new long-term debt at the operating entity following the recent retirement of AGP's remaining outstanding first mortgage bonds. Revolver borrowings are typically for inventory and seasonal in nature and APU's liquidity position is expected to be more than adequate for seasonal borrowings heading into the winter heating season. The revolving credit facility matures on Oct. 15, 2011. AMR CORP: S&P Changes Outlook to Stable, Affirms 'B-' Rating ------------------------------------------------------------ Standard & Poor's Ratings Services said it has revised its outlook on AMR Corp. and its major operating subsidiary, American Airlines Inc., to stable from negative, based on AMR's improved operating performance, which has bolstered credit quality. S&P also affirmed its 'B-' corporate credit rating and most issue ratings on the two companies and lowered selected ratings on American's enhanced equipment trust certificates. "S&P's affirmation and outlook revision are based on AMR's improving operating performance, which has strengthened its credit ratios," said Standard & Poor's credit analyst Betsy Snyder. The company reported its first quarterly profit since the third quarter of 2007 -- $143 million in the third quarter of 2010. The company had a loss of $359 million in the same period of 2009. For the nine months ended Sept. 30, 2010, the company narrowed its loss to $373 million from $1.1 billion. The improved operating performance was primarily the result of a 12% increase in revenues in the first nine months of 2010, and passenger revenue per available seat mile was up 12% from that at the same period in 2009. Still, AMR has lagged behind the industry in profitability, as all other U.S. airlines reported profits in the second quarter of 2010. AMR's credit measures, although improving, remain weaker than those of the other large U.S. airlines. For the full year 2010, S&P expects the company to report a loss, albeit substantially lower than the $1.5 billion reported in 2009, and S&P expects the company to roughly break even in 2011, assuming low economic growth and no fuel price spike. This should result in slight improvement in credit ratios. S&P's rating actions on American's EETCs are based, in addition to the affirmation of the corporate credit rating, on S&P's review of collateral protection available to holders of the EETCs and on S&P's estimates of any changes in the importance of particular aircraft to American (which could affect whether the airline would affirm the aircraft financings in any future bankruptcy, or return the aircraft to creditors). The ratings on Dallas, Texas-based AMR and American Airlines reflect a highly leveraged financial profile with significant intermediate-term debt maturities and risks associated with participation in the price-competitive, cyclical, and capital- intensive airline industry. The ratings also reflect AMR's adequate liquidity and diverse global route network. S&P characterize AMR's business risk profile as weak and its financial risk profile as highly leveraged. Since late 2008, AMR's market share has fallen to third place from first among U.S. airlines. American's global route network, although extensive, is not as comprehensive as either United/Continental's or Delta's, and American has a small presence in Asia. However, American has a leading position among U.S. airlines in Latin America, and substantial traffic connects through its Miami hub. AMR has focused on operations at five cities that it calls "cornerstones" -- New York, Los Angeles (LAX), Miami, Chicago, and Dallas/Ft. Worth (DFW) -- all major population and business centers. In July 2010, AMR began an arrangement with JetBlue Airways Corp., in which passengers on either airline can connect with the other at New York and Boston. On Oct. 1, 2010, after 14 years of attempts, American finally launched a joint venture with British Airways and Iberia across the Atlantic, after receiving clearance from U.S. and EU regulators. American has also received tentative approval from U.S. regulators and final approval from Japanese regulators to begin a similar joint venture with JAL across the Pacific. It will also begin service from New York to Haneda, Tokyo's close-in airport, in January 2011. The company estimates these initiatives could bring in additional annual revenues and cost savings of at least $500 million by the end of 2012, with the bulk coming in 2011. The outlook is stable. If continued improved profitability generates adjusted funds flow to debt of at least 10% for a sustained period, and the company successfully refinances its substantial 2011 and 2012 debt maturities, S&P could raise its ratings. Conversely, if adverse industry conditions (for example, a double-dip recession or serious fuel price spike) cause financial results to deteriorate such that funds flow to debt falls into the low-single-digit percent area, or if unrestricted liquidity falls below $3 billion on a sustained basis, S&P could lower the ratings. AMSOUTH BANCORP: Moody's Cuts Regular Bond/Debenture Rating to Ba2 ------------------------------------------------------------------ Moody's Investors Service announced that it has downgraded the ratings of 10 large U.S. regional banks after reducing its government support assumptions for these entities. The affected entities, whose ratings were placed on review for possible downgrade on July 27, 2010, had benefited from Moody's support assumptions since 2009. The banks affected by this action are subsidiaries of these 10 holding companies, listed alphabetically. This list includes the current bank-level deposit ratings following the removal of support. * BB&T Corporation -- bank deposits to Aa3 from Aa2 * Capital One Financial Corporation -- bank deposits to A3 from A2 * Fifth Third Bancorp -- bank deposits to A3 from A2 * KeyCorp -- bank deposits to A3 from A2 * PNC Financial Services Group, Inc. -- bank deposits to A2 from A1 * Popular, Inc. -- bank deposits to Baa3 from Baa2 * Regions Financial Corporation -- bank deposits to Baa3 from Baa1 * SunTrust Banks, Inc. -- bank deposits to A3 from A2 * U.S. Bancorp -- bank deposits to Aa2 from Aa1 * Zions Bancorporation -- bank deposits to Ba3 from Ba2 Additionally, as a result of the reduced support assumptions, the ratings outlook on the subsidiaries of American Express Company was changed. These issuers' guaranteed debt obligations issued under the FDIC's TLGP program were unaffected by the actions and remain Aaa. Rating Rationale "The downgrades reflect Moody's view that the likelihood of government support for these 10 institutions is lower now that the U.S. banking system has moved beyond the depths of the financial crisis," said Robert Young, Managing Director for Moody's North American Bank Ratings. "The failure of any one of these banks therefore would be unlikely to trigger contagion and systemic risk." In passing the Dodd-Frank Wall Street Reform and Consumer Protection Act this summer, the government signaled its intent to limit support for individual banks. This contrasts with its stance in early 2009, when it stated that support would be forthcoming for large regional banks that could not raise sufficient capital to satisfy government requirements under the Supervisory Capital Assessment Program. In reviewing its support assumptions, Moody's took into account the government's existing TARP investments in six large regional banks (Fifth Third, KeyCorp, Popular, Regions, SunTrust, and Zions). "Although the TARP investments are significant, all of these banks are currently devising plans to repay the government and are unlikely to keep the TARP in place over the long term," Young noted. The probability that the government would support any one of these institutions through a TARP conversion is therefore limited. Specific Bank Actions Differ BB&T: Moody's removed its assumption of support and placed BB&T's long-term ratings on review for further downgrade. During its review of BB&T's stand-alone credit strength, Moody's will focus on BB&T's ability to maintain its core pre-provision, pre-tax earnings in a still-challenging environment for U.S. banks, while assessing the risks associated with its above-average loan growth outside of commercial real estate as it shifts its portfolio away from that troubled asset class. Moody's will also consider the likely pace of further reductions in BB&T's sizable portfolio of foreclosed properties. In the event of a downgrade, a one-notch reduction is most likely. Were this to occur, BB&T's ratings would remain comparatively high, particularly among its Southeastern and large regional bank peers. Its senior holding company obligations are currently rated A1 and its long-term bank deposits (after the removal of systemic support) are rated Aa3. BB&T's Prime-1 short-term ratings, at both the bank and the holding company, are affirmed and are not on review. SunTrust: The downgrade resulting from the removal of systemic support assumptions was tempered by Moody's upgrade of SunTrust's stand-alone bank financial strength rating to C from C-. The combination of these two actions resulted in most of the holding company's ratings being confirmed (senior debt, Baa1), except for the preferred stock ratings, which were notched off the BFSR and were therefore upgraded with the BFSR (non-cumulative preferred to Ba1 from Ba2). However, the combination of the removal of systemic support assumptions and the upgrade of the BFSR did lead to a one-notch downgrade of the ratings on SunTrust Bank (long- term deposit rating to A3 from A2; short-term rating to Prime-2 from Prime-1). Following these rating actions, the outlook on all of SunTrust's ratings is stable. Regions: The removal of support assumptions resulted in a two- notch downgrade of Regions' bank-level debt and deposit ratings (long-term deposit rating to Baa3 from Baa1; short-term rating to Prime-3 from Prime-2) and a one-notch downgrade of the holding company's ratings (senior debt to Ba1 from Baa3; short-term rating to Not-Prime from Prime-3). Following these actions, the outlook on all of Regions' ratings remains negative. Capital One, Fifth Third, KeyCorp, Zions: The removal of support assumptions resulted in a one-notch downgrade of these four banks' bank-level debt and deposit ratings, but did not affect any of the holding companies' ratings, which were not on review. PNC, Popular, U.S. Bancorp: Moody's continues to ascribe support in the case of these three banks, but at a reduced level. The reduction in the support assumption resulted in a one-notch downgrade of these banks' bank-level debt and deposit ratings. The ratings of these entities' holding companies were not on review and were affirmed at their current level. While the lower probability of support does not provide any lift to their current stand-alone ratings, at a lower stand-alone rating some ratings lift might result. The ongoing assumption of support for US Bancorp and PNC is due primarily to their importance in the payment system and their significant national deposit share. The support assumption for Popular reflects its dominant position in Puerto Rico, together with that island's physical isolation and political importance. Rating Outlooks The rating outlook on four of these banks did not change. The outlook on Regions, Popular, and U.S. Bancorp remains negative, while that on Zions remains positive. However, the ratings outlook on six of the banks did change. On Capital One, Fifth Third, and KeyCorp it was changed to stable from negative; on PNC it was changed to positive from stable; and on SunTrust it was changed to stable after the upgrade discussed above. "These outlook changes reflect the banks' improving credit metrics and strengthened capital profiles relative to Moody's previous expectations, particularly at PNC and SunTrust," said Allen Tischler, Moody's Vice President and Lead Analyst for Fifth Third, KeyCorp, SunTrust, and PNC. Finally, the rating outlook on American Express Company's subsidiaries was changed to negative from stable as a result of the removal of the support assumption. The last rating action on BB&T Corporation, Capital One Financial Corporation, Fifth Third Bancorp, KeyCorp, PNC Financial Services Group, Inc., Popular, Inc., Regions Financial Corporation, SunTrust Banks, Inc., and U.S. Bancorp was on July 27, 2010, when Moody's placed on review for possible downgrade all the ratings that had benefited from systemic support at these banks. The last rating action on Zions Bancorporation and its subsidiaries was on August 3, 2010, when Moody's changed the rating outlook on the unsupported ratings of Zions Bancorporation and its subsidiaries to positive from negative, including those of its lead bank, Zions First National Bank. The last rating action on American Express Company was on February 17, 2010, when Moody's downgraded the ratings on certain U.S. banks' hybrid securities, in line with its revised Guidelines for Rating Bank Hybrids and Subordinated Debt, published in November 2009. Downgrades: Issuer: BB&T Financial, FSB -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: Banco Popular de Puerto Rico -- Issuer Rating, Downgraded to Baa3 from Baa2 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa2 Issuer: Branch Banking and Trust Company -- Issuer Rating, Downgraded to Aa3 from Aa2 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa3 from Aa2 -- Multiple Seniority Bank Note Program, Downgraded to a range of A1 to Aa3 from a range of Aa3 to Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to A1 from Aa3 -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: SunTrust Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3 from a range of (P)P-1, (P)A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Fifth Third Bank, Ohio -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to P-2 from P- 1 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: KeyBank National Association -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Multiple Seniority Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3, (P)Baa1 from a range of (P)P-1, (P)A2, (P)A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to a range of A3 to P-2 from a range of A2 to P-1 -- Senior Unsecured Deposit Program, Downgraded to P-2, A3 from P-1, A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: National City Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 Issuer: National City Bank of Indiana -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Kentucky -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Pennsylvania -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: PNC Bank, N.A. -- Issuer Rating, Downgraded to A2 from A1 -- OSO Senior Unsecured OSO Rating, Downgraded to A2 from A1 -- Multiple Seniority Bank Note Program, Downgraded to a range of A2, A3 from a range of A1, A2 -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Bank Note Program, Downgraded to A2 from A1 -- Senior Unsecured Medium-Term Note Program, Downgraded to (P)A2 from (P)A1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 -- Senior Unsecured Deposit Rating, Downgraded to A2 from A1 Issuer: Provident Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: U.S. Bank National Association -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Aa2, Aa3 from a range of Aa1, Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to Aa3 from Aa2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: U.S. Bank National Association ND -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: Capital One Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of P-2, A3, Baa1 from a range of P-1, A2, A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Capital One, N.A. -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: AmSouth Bancorporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 Issuer: AmSouth Bank -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Regions Bank -- Issuer Rating, Downgraded to Baa3 from Baa1 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Ba1 to P-3 from a range of Baa2 to P-2 -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa1 Issuer: Regions Financial Corporation -- Issuer Rating, Downgraded to a range of NP, Ba1 from a range of P-3, Baa3 -- Multiple Seniority Shelf, Downgraded to a range of (P)Ba3 to (P)Ba1 from a range of (P)Ba2 to (P)Baa3 -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Subordinate Shelf, Downgraded to (P)Ba2 from (P)Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Regions Financing Trust II -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 -- Preferred Stock Shelf, Downgraded to (P)Ba3 from (P)Ba2 Issuer: Regions Financing Trust III -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 Issuer: Union Planters Bank, National Association -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Union Planters Corporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Amegy Bank National Association -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: California Bank & Trust -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Nevada State Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Zions First National Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Upgrades: Issuer: SunTrust Bank -- Bank Financial Strength Rating, Upgraded to C from C- Issuer: SunTrust Banks, Inc. -- Multiple Seniority Shelf, Upgraded to (P)Baa3 from (P)Ba1 -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Preferred Capital I -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Real Estate Investment Corporation -- Preferred Stock Preferred Stock, Upgraded to Baa3 from Ba1 On Review for Possible Downgrade: Issuer: BB&T Capital Trust I -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust II -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust IV -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust V -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VI -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VII -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VIII -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Corporation -- Issuer Rating, Placed on Review for Possible Downgrade, currently A1 -- Multiple Seniority Medium-Term Note Program, Placed on Review for Possible Downgrade, currently a range of (P)A2, (P)A1 -- Multiple Seniority Shelf, Placed on Review for Possible Downgrade, currently a range of (P)A3 to (P)A1 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A2 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 Issuer: BB&T Financial, FSB -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Issuer: Branch Banking and Trust Company -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Issuer Rating, Placed on Review for Possible Downgrade, currently Aa3 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Multiple Seniority Bank Note Program, Placed on Review for Possible Downgrade, currently a range of A1 to Aa3 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Outlook Actions: Issuer: American Express Travel Related Svcs Co., Inc -- Outlook, Changed to Negative From Stable Issuer: American Express Centurion Bank -- Outlook, Changed to Negative From Stable Issuer: American Express Bank, FSB -- Outlook, Changed to Negative From Stable Issuer: American Express Credit Corporation -- Outlook, Changed to Negative From Stable Issuer: BB&T Capital Trust I -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust II -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust IV -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust V -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VI -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VIII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Corporation -- Outlook, Changed To Rating Under Review From Negative Issuer: Banco Popular de Puerto Rico -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Financial Corporation -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital II -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital III -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital IV -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital V -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital VI -- Outlook, Changed to Stable from Negative Issuer: North Fork Capital Trust II -- Outlook, Changed to Stable from Negative Issuer: Hibernia Corporation -- Outlook, Changed to Stable from Negative Issuer: National Commerce Capital Trust I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Banks, Inc. -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital IX -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital VIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital X -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Preferred Capital I -- Outlook, Changed To Stable From Negative Issuer: SunTrust Real Estate Investment Corporation -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Bank, Ohio -- Outlook, Changed To Stable From Rating Under Review Issuer: Fifth Third Bancorp -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust II -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust IV -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust V -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VI -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VII -- Outlook, Changed To Stable From Negative Issuer: KeyBank National Association -- Outlook, Changed To Stable From Rating Under Review Issuer: KeyCorp -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital I -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital II -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital III -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital V -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VI -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VIII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital IX -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital X -- Outlook, Changed To Stable From Negative Issuer: National City Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Indiana -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Kentucky -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Pennsylvania -- Outlook, Changed To Positive From Rating Under Review Issuer: PNC Bank, N.A. -- Outlook, Changed To Positive From Rating Under Review Issuer: Provident Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Preferred Capital Trust I -- Outlook, Changed To Positive From Stable Issuer: Merchants National Corp -- Outlook, Changed To Positive From Stable Issuer: National City Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust C -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust D -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust E -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust F -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust G -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust H -- Outlook, Changed To Positive From Stable Issuer: PNC Funding Corporation -- Outlook, Changed To Positive From Stable Issuer: Mercantile Bankshares Corporation -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust II -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust III -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust IV -- Outlook, Changed To Positive From Stable Issuer: National City Credit Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Financial Services Group, Inc. -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust I -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust II -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust III -- Outlook, Changed To Positive From Stable Issuer: U.S. Bank National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: U.S. Bank National Association ND -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: Capital One, N.A. -- Outlook, Changed To Stable From Rating Under Review Issuer: AmSouth Bancorporation -- Outlook, Changed To Negative From Rating Under Review Issuer: AmSouth Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financial Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust II -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust III -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Bank, National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Amegy Bank National Association -- Outlook, Changed To Positive From Rating Under Review Issuer: California Bank & Trust -- Outlook, Changed To Positive From Rating Under Review Issuer: Nevada State Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: Zions First National Bank -- Outlook, Changed To Positive From Rating Under Review Confirmations: Issuer: National Commerce Capital Trust I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Banks, Inc. -- Issuer Rating, Confirmed at Baa1 -- Multiple Seniority Shelf, Confirmed at (P)Baa3, (P)Baa2, (P)Baa1 -- Subordinate Regular Bond/Debenture, Confirmed at Baa2 -- Senior Unsecured Regular Bond/Debenture, Confirmed at Baa1 Issuer: SunTrust Capital I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital IX -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital VIII -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital X -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVII -- Preferred Stock Shelf, Confirmed at (P)Baa3 The principal methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, and Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007. ANGIOTECH PHARMACEUTICALS: Moody's Cuts Default Rating to 'Ca/LD' ----------------------------------------------------------------- Moody's Investors Service downgraded the probability of default rating of Angiotech Pharmaceuticals, Inc., to Ca/LD from Ca and affirmed the Corporate Family Rating at Ca. The company's other existing debt ratings were affirmed. The outlook is developing. The assignment of the Ca/LD is the conclusion of the 30-day grace period in which the company missed the original interest payment of $9.7 million on its 7.75%, $250 million senior subordinated notes due Oct. 1, 2010. Moody's treats the failure to meet the original contractual terms as a limited default. Rating downgraded: Angiotech Pharmaceuticals, Inc. -- Probability of Default Rating to Ca/LD from Ca Ratings affirmed and LGD assessment revised: -- Corporate Family Rating at Ca -- $325 Million Senior Unsecured Notes at Caa2; (LGD2, 27%) from (LGD2, 28%) -- $250 Million Senior Subordinated Notes at C; (LGD5, 82%) -- Speculative Grade Liquidity Rating at SGL-4 Ratings Rationale The LD designation assigned by Moody's results from Angiotech's inability to make the Oct. 1, 2010 interest payment on the 7.75% senior subordinated notes. As well, the company announced that it has entered into an agreement with the senior subordinated note holders to exchange their notes for approximately 90% of new common stock of Angiotech issued and outstanding following the completion of the recapitulation transaction. The developing outlook reflects the uncertain that should Angiotech fail to complete the recapitalization; the company might need to seek credit protection under Canada's "Companies Creditors Arrangement Act". However, if the recapitalization is complete, Angiotech's financial position and liquidity could possible support a higher rating. Moody's last rating action was on Sept. 23, 2008, at which time Moody's lowered Angiotech's corporate family rating to Ca from B3 and the probability default rating to Ca from B2. Angiotech Pharmaceuticals, Inc., founded in 1992, based in Vancouver, Canada, is a specialty pharmaceutical and medical device company that focuses on acute and surgical applications. APPALACHIAN OIL: U.S. Trustee Wants Case Converted to Chapter 7 --------------------------------------------------------------- The U.S. Trustee has filed a motion to convert the Chapter 11 case of Appalachian Oil Company, Inc., to one under Chapter 7 of the Bankruptcy Code. A hearing on the requested conversion was scheduled for November 2, 2010, at 9:00 a.m. Management Properties, Inc. a former landlord of the Debtor, supports the U.S. Trustee's motion, relating that it is in the best interest of creditors to allow a dismissal of the Debtor's case. About Appalachian Oil Appalachian Oil sought Chapter 11 protection before the U.S. Bankruptcy Court for the Eastern District of Tennessee on February 9, 2009 (Case No. 09-50259). Mark S. Dessauer, Esq., at Hunter, Smith & Davis, in Kingsport, Tennessee, represents the Debtor as counsel. The Debtor estimated its assets and debts at $10 million and $50 million. The Company's creditors with the biggest unsecured claims are BP Plc's Amoco/BP, owed $2.41 million, and fuel distributor Crescent Oil Co., owed $1.6 million. The official committee of unsecured creditors is represented by Brent C. Strickland, Esq., and John F. Carlton, Esq., at Whiteford, Taylor & Preston L.L.P., in Baltimore, Maryland. APPALACHIAN OIL: Committee Withdraws Objection to Plan ------------------------------------------------------ The Official Committee of Unsecured Creditors formed in the Chapter 11 case of Appalachian Oil Company, Inc., is withdrawing its objection to the confirmation of the Debtor's proposed plan of liquidation. The Committee decided on the withdrawal following revisions to the Plan on October 18. Commonwealth of Virginia, Department of Taxation, has also submitted a proposed agreed order withdrawing its objection to the Plan. The Debtor was scheduled to present the Plan for confirmation at a hearing scheduled for November 2, 2010, at 9:00 a.m. The Plan calls for the liquidation of APPCO's remaining assets and the distribution of the proceeds derived therefrom in accordance with the Plan. The funding for the Plan will come from three sources, the funds held by the Official Committee of Unsecured Creditors, preference recoveries collected by the Debtor, and postpetition receivables due the Debtor. About Appalachian Oil Appalachian Oil sought Chapter 11 protection before the U.S. Bankruptcy Court for the Eastern District of Tennessee on February 9, 2009 (Case No. 09-50259). Mark S. Dessauer, Esq., at Hunter, Smith & Davis, in Kingsport, Tennessee, represents the Debtor as counsel. The Debtor estimated its assets and debts at $10 million and $50 million. The Company's creditors with the biggest unsecured claims are BP Plc's Amoco/BP, owed $2.41 million, and fuel distributor Crescent Oil Co., owed $1.6 million. The official committee of unsecured creditors is represented by Brent C. Strickland, Esq., and John F. Carlton, Esq., at Whiteford, Taylor & Preston L.L.P., in Baltimore, Maryland. APARTMENTS AT JUPITER: Case Summary & Creditors List ---------------------------------------------------- Debtor: Apartments at Jupiter, LLC 6701 Mallards Cove Road, Building 47 Jupiter, FL 33458 Bankruptcy Case No.: 10-43458 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Southern District of Florida (West Palm Beach) Judge: Erik P. Kimball Debtor's Counsel: David L. Merrill, Esq. 7777 Glades Road, #400 Boca Raton, FL 33434 Tel: (561) 477-7800 E-mail: dlmerrill@sbwlawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flsb10-43458.pdf The petition was signed by Robert Littman, manager. ASBURY AUTOMOTIVE: S&P Assigns 'B-' Rating to $200 Mil. Notes ------------------------------------------------------------- Standard & Poor's Ratings Services said it has assigned its 'B-' issue-level rating and '6' recovery rating on Asbury Automotive Group Inc.'s proposed offering of $200 million senior subordinated notes due 2020. The '6' recovery rating reflects S&P's expectation that lenders would receive negligible (0% to 10%) recovery in the event of a default. The company intends to use the net proceeds of this offering to purchase all of the 8% subordinated notes due March 15, 2014, to be tendered in an offer made by the company. The debt tender offer expires Dec. 1, 2010. In addition, the company announced its intention to amend its existing 7.625% senior subordinated notes due 2017 to reset the consolidated net income calculation of its restricted payments test under the indenture. And, the company is seeking an amendment under its revolving credit facility agreement to update its restricted payments capacity. Overall, S&P holds a positive view of the combined transactions, although cash interest will rise slightly, because they will reduce near-term debt-refinancing risk and improve Asbury's near- term financial flexibility. As of June 30, 2010, Asbury had about $179 million in principal amount of the 8% subordinated notes outstanding. If the amount of 8% notes tendered is less than the net proceeds from the offering of the new subordinated notes, S&P expects Asbury to use the proceeds to repay amounts outstanding under its 3% convertible debentures. Still, if any 8% notes remain outstanding after the tender offer, S&P expects Asbury to call these notes. The ratings on Asbury Automotive (B+/Stable/--) reflect S&P's view that the company will be able to maintain current credit measures while preserving its weak financial policy and capability to generate free cash flow into 2011. During the recession and sharp downturn in light-vehicle sales, the company controlled its variable costs to mitigate margin erosion and offset difficult auto sales with its sizable dealership network and diverse revenue streams. Ratings List Asbury Automotive Group Inc. Corp. Credit Rating B+/Stable/-- New Rating Asbury Automotive Group Inc. $200 mil. 8.5% sr. nts due 11/30/2020 B- Recovery Rating 6 AWAL BANK BSC: Section 341(a) Meeting Set for December 1 -------------------------------------------------------- The U.S. Trustee for Region 2 will convene a meeting of creditors in Awal Bank BSC's Chapter 11 case on December 1, 2010, at 2:30 p.m. The meeting will be held at the Office of the U.S. Trustee, 80 Broad Street, Fourth Floor, New York City. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. About Awal Bank Awal Bank BSC is a Bahrain lender owned by Saudi Arabian Saad Group. Awal Bank was principally an investment company that provides wholesale banking services in Bahrain including the acceptance of deposits and the making of loans. Awal Bank was taken into administration by the Central Bank of Bahrain on July 30, 2009, after defaulting on loans. U.S. lawyers for the bank said last year that under Bahrain law, Awal's administrator had two years to decide if the bank should liquidate or be returned to management and shareholders. Stewart Hey, Esq., at Charles Russell LLP, as external administrator of Awal Bank BSC, made a voluntary petition under Chapter 15 of the U.S. Bankruptcy Code for the bank (Bankr. S.D.N.Y. Case No. 09-15923) on Sept. 30, 2009, following the administration proceedings. Earlier this year, the bank began experiencing a liquidity squeeze, brought on in part, by the global economic crisis. The bank has ceased to operate as a going concern since it was place into administration. In the Chapter 15 petition, the bank estimated both assets and debts at more than $1 billion. Awal Bank filed a chapter 11 petition (Bankr. S.D.N.Y. Case No. 10-15518) in Manhattan on October 21, 2010. The Debtor estimated $50 million to $100 million and debts in excess of $1 billion as of the petition date. BANNING LEWIS: Bankr. Filing Broke Deadlock Among Stakeholders -------------------------------------------------------------- Dow Jones' DBR Small Cap reports that the decision for Banning Lewis Ranch Co. to enter bankruptcy was made by two of the three stakeholders in Banning Lewis Ranch, according to a document filed Thursday with the U.S. Bankruptcy Court in Wilmington, Del. The report relates that the financial condition of Banning Lewis Ranch had prompted the three stakeholders to consider "possible restructuring and other strategic alternatives" for the company, but the stakeholders were ultimately unable to agree on what action to take, according to the document. As a result, two of the stakeholders -- Farallon BLR Investors LLC and Greenfield BLR Partners LP -- decided to place Banning Lewis Ranch in bankruptcy in an effort to "break the deadlock," the report notes. The report adds that the two stakeholders, which also placed subsidiary Banning Lewis Ranch Development I & II LLC in Chapter 11 Thursday, tapped Edward A. About Banning Lewis Banning Lewis Ranch Co. is the owner of the undeveloped portion of a 21,000-acre ranch in Colorado Springs, Colo. Banning Lewis Ranch is a master-planned community in Colorado Springs, Colorado. The first section built, the 350-acre Northtree Village, opened in September 2007 and will have 1,000 homes priced from the high $100,000s to the mid-$300,000s. Banning Lewis Ranch Co. filed for Chapter 11 bankruptcy protection from creditors on October 28, 2019 (Bankr. D. Del. Case No. 10- 13445). It estimated assets of $50 million to $100 million and debts of $100 million to $500 million in its Chapter 11 petition. An affiliate, Banning Lewis Ranch Development I & II, LLC, also filed for Chapter 11 (Bankr. D. Del. Case No. 10-13446). Kevin Scott Mann, Esq., at Cross & Simon, LLC, serves as counsel to the Debtors. Edward A. Phillips of Eisner Amper LLP will be retained as chief restructuring officer of the Company. BERNARD L MADOFF: Recoveries by Trustee Now at $1.5 Billion ----------------------------------------------------------- Irving H. Picard, the trustee liquidating Bernard L. Madoff Investment Securities, LLC, has so far recovered $1.5 billion for victims of Bernard Madoff's Ponzi scheme. According to the trustee's fourth interim report filed October 30, 2010, the asset recoveries encompass the sale of the Debtor's market making operations, including quarterly payments under the Third Amended and Restated Asset Purchase Agreement with Surge Trading Inc; the settlement of BLMIS' trades and open positions; cash recoveries from banks and brokerage accounts that held BLMIS' funds; class action settlement recoveries; the sale of sports tickets; insurance refunds; refunds of political contributions; tax recoveries; the sale of BLMIS loan participations; the sale of BLMIS DTCC shares; pre-litigation settlements with various funds and entities for the return of customer property; and various other miscellaneous recoveries. Mr. Picard took in about $849,000 for victims during the fourth interim period -- from April 1, 2010, to September 30, 2010 -- including about $771,000 from litigation. Mr. Picard paid more than $25 million in professional fees and expenses during the period. The trustee's report provides an overview of all of the efforts engaged in by the Trustee and his team of professionals and summarizes all of the results achieved and challenges faced by the trustee. A copy of the fourth interim report is available at: http://bankrupt.com/misc/Madoff_Picard_4thReport.pdf About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) As of October 29, 2010, a total of US$5.69 billion in claims by investors has been allowed, with US$741.2 million to be paid by the Securities Investor Protection Corp. Investors are expected to receive additional distributions from money recovered by Mr. Picard. BERNARD L MADOFF: Trustee Extends Hardship Program -------------------------------------------------- Irving H. Picard, the trustee liquidating Bernard L. Madoff Investment Securities, LLC, said November 1 that he is continuing his hardship program for victims of Madoff's Ponzi scheme. The Trustee has established a Hardship Program to accelerate the determination of a claim and receipt of SIPC protection up to $500,000 for individual account holders of BLMIS who are suffering hardship. An individual can qualify for the Hardship Program if he or she has filed a claim and is unable to pay for necessary living or medical expenses, over 65 years old and forced to reenter the work force after retirement, declaring personal bankruptcy, unable to pay for the care of dependents, or otherwise suffers from extreme financial hardship beyond the identified circumstances. As of September 30, 2010, the Trustee has received 317 Hardship Program applications and approved 196 applications. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) As of October 29, 2010, a total of US$5.69 billion in claims by investors has been allowed, with US$741.2 million to be paid by the Securities Investor Protection Corp. Investors are expected to receive additional distributions from money recovered by Mr. Picard. BK INVESTMENTS: Case Summary & 2 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: BK Investments, LLP P.O. Box 620 1400 Gerrard Road Lavonia, GA 30553 Bankruptcy Case No.: 10-31954 Chapter 11 Petition Date: October 28, 2010 Court: U.S. Bankruptcy Court Middle District of Georgia (Athens) Debtor's Counsel: Ernest V. Harris, Esq. P.O. Box 1586 Athens, GA 30603 Tel: (706) 613-1953 Fax: (706) 613-0053 E-mail: ehlaw@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/gamb10-31954.pdf The petition was signed by Jerilyn K. Blakely, estate administrator. BLOCKBUSTER INC: Wins Final Approval for $125MM of DIP Financing ---------------------------------------------------------------- Judge Burton R. Lifland of the U.S. Bankruptcy Court for the Southern District of New York granted, on a final basis, the Debtors' request to obtain a $125,000,000 loan pursuant to the terms and conditions of a Senior Secured, Super-Priority Debtor- in-Possession Revolving Credit Agreement with Wilmington Trust FSB. Judge Lifland approved the loan after it was changed to meet objections from creditors and landlords, reports Tiffany Kary of Bloomberg News. New terms require Blockbuster to have a business plan approved by secured lenders on Nov. 30, the same day a description of the company's reorganization terms is due, she says. In addition, pre-bankruptcy lenders won't get potential proceeds from certain lawsuits, and the amount of pre-bankruptcy debt that lenders can roll into the new loan was cut to $125 million from $250 million, says the Bloomberg report. "With those primary changes, it resolves the creditors' committee's objections," Bloomberg cited Martin Sosland, Esq., a lawyer for Blockbuster, as telling Judge Lifland. Richard S. Kanowitz, Esq., counsel for the Official Committee of Unsecured Creditors, said changes to the bankruptcy loan will ensure that lenders can't end the loan if Blockbuster doesn't meet certain milestones every four weeks. He said the Committee plans to pursue an investigation into the liens of secured lenders. "It's not like we're going to sing 'Kumbaya' in the hallway; there are still things to work out," Mr. Kanowitz told Judge Lifland, reports Bloomberg. The Debtors' authority to use the proceeds of the DIP Financing or any Prepetition Collateral, including Cash Collateral, and any commitment to make additional advances under the Revolving DIP Loan, will each terminate upon, unless waived, forborne or consented to by the Requisite DIP Lenders, the earliest of: -- April 30, 2011; -- the date of any acceleration of the Revolving DIP Loans in accordance with the terms of the DIP Loan Documents; -- the date of any occurrence of an Event of Default under the DIP Loan Documents; -- the breach of any obligations under the Final Order; -- the date upon which any provision of the Final Order will for any reason cease to be valid and binding, or any of the Debtors will so assert in any pleading filed in any court; -- the effective date of a plan of reorganization or a plan of liquidation in any of the Chapter 11 Cases; and -- the occurrence of a "Termination Event," as defined in the Plan Support Agreement, between Blockbuster and certain Senior Secured Noteholders, dated as of September 22, 2010. All Obligations, including the DIP Obligations and the Adequate Protection Obligations, will be due and payable in immediately available funds upon the occurrence of a Termination Event, unless an alternative treatment is consented to in accordance with the Final Order. Prior to the Court's entry of its Final DIP Order, Lyme Regis Partners LLC filed a demand for contested hearing procedures or a deferred hearing in support of its objection to the DIP Request. The Debtors informed the Court that they have been negotiating with the Objecting Parties to resolve the objections. The Court ruled that any objections to the DIP Motion that have not been previously resolved or withdrawn are overruled on their merits and all reservation of rights included in those objections are denied and overruled. A full-text copy of the Final DIP Order is available for free at: http://bankrupt.com/misc/BBI_Final_DIP_Order.pdf Company Statement The Court also approved the retention of certain legal and Blockbuster has subsequently received final court authorization, among other things, to: * Pay employees in the usual manner and continue their benefits without disruption; * Continue honoring the Blockbuster Rewards(R) program, valid coupons, gift cards and other customer programs; * Continue to maintain cash management systems; and * Pay certain undisputed pre-petition obligations of certain essential vendors, suppliers and service providers. Jim Keyes, chairman and chief executive officer, said: "We are pleased that the court has granted these final orders, which will enable us to continue to meet our obligations to customers, suppliers and employees as we move forward with the recapitalization process. We continue to work diligently with our senior noteholders, the movie studios, the unsecured creditors committee and other key parties on our recapitalization plan, which, when implemented, will strengthen our balance sheet and allow us to continue transforming our business model." 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: Wins Final Approval for Access to Cash Collateral ------------------------------------------------------------------ The Bankruptcy Court granted, on a final basis, Blockbuster Inc.'s request for authority to use prepetition cash collateral, and to provide adequate protection to the DIP Lenders, the Roll-Up Noteholders, and the Senior Secured Noteholders and the Senior Indenture Trustee -- the Adequate Protection Parties. The Adequate Protection Parties are entitled to adequate protection of their interests in the Prepetition Collateral, including the Cash Collateral, equal in amount to the aggregate diminution in the value of their security interests in the Prepetition Collateral as a result of the Debtors' sale, lease or use of Cash Collateral, and the imposition of the automatic stay pursuant to Section 362 of the Bankruptcy Code. As adequate protection, the Adequate Protection Parties are granted these claims, liens, rights and benefits: (a) replacement security interest in and lien upon all the DIP Collateral other than the Avoidance Action Proceeds, subject and subordinate only to the Carve-Out Expenses, the liens securing the DIP Obligations, and Ad Valorem Liens; (b) allowed superpriority administrative expense claims as provided for in Section 507(b) of the Bankruptcy Code, immediately junior to the claims under Section 364(c)(1) of the Bankruptcy Code held by the DIP Agent, the DIP Lenders and the Roll-Up Noteholders, provided that the Adequate Protection Superpriority Claims will not be paid or satisfied with Avoidance Action Proceeds; (c) reasonable and documented fees and expenses of professionals; (d) financial reporting by the Debtors to the Senior Indenture Trustee in compliance with the Senior Indenture, the Final Order and the DIP Credit Agreement; and (e) accrual of interest at the non-default rate under the Senior Indenture after the Petition Date until the Termination Date. All intercompany/affiliate liens of the Debtors, if any and other than any liens securing the DIP Obligations, are subordinated in all respects to the repayment of the DIP Obligations and the Adequate Protection Obligations. All intercompany/affiliate liens among the Debtors' non-debtor affiliates or between the non-debtor affiliate and a Debtor are subordinated to the repayment of the DIP Obligations and the Adequate Protection Obligations on terms consented to by the Requisite DIP Lenders. 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: Wins Nod to Pay $68.5 Mil. in Debt to Studios -------------------------------------------------------------- The Bankruptcy Court granted Blockbuster Inc.'s request, on a final basis, to pay pre-bankruptcy claims of movie companies, regardless of whether the claims are secured or unsecured. The Debtors had estimated they owed $68.5 million to studios that were secured lenders and $49.6 million to others, notes Bloomberg News. Judge Lifland noted that nothing in the Order will prohibit the Debtors from seeking authority from the Court to increase the prepetition amounts authorized to be paid under the Order. He added that nothing in the Order (i) is intended to authorize any professional fees and expenses pursuant to Sections 503(b)(3) and (4) of the Bankruptcy Code, and (ii) will be deemed to constitute an assumption or adoption of any executory contract or prepetition or postpetition agreement between the Debtors and the holder of a Studio Claim. In its previous objection and responses against the Studio Motion, Lyme Regis Partners, LLC alleged, among other things, that the Debtors failed show that payment of the prepetition claims to the Studios is critical to continuing delivery of their goods to the Debtors. Lyme Regis also demanded for contested hearing procedures and a deferred hearing on the Studio Motion. The Debtors replied that Lyme Regis has had ample opportunity to propound discovery requests in connection with the Studio Motion, but had failed to do so. The Court ruled that objections to the Studio Motion that have not been previously resolved or withdrawn are overruled on their merits and all reservation of rights included in those objections are denied and overruled. 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) BONEYARD LLC: Chapter 11 Reorganization Case Dismissed ------------------------------------------------------ The Hon. Erithe A. Smith of the U.S. Bankruptcy Court for the Central District of California dismissed the Chapter 11 cases of Boneyard, LLC, and Luckey Industrial, LLC. Irvine, California-based Boneyard, LLC, is a limited liability company whose sole member is Le Plastrier Management Co., Inc. Boneyard filed for Chapter 11 bankruptcy protection on Dec. 14, 2009 (Bankr. C.D. Calif. Case No. 09-23930). Richard W. Esterkin, Esq., who has an office in Los Angeles, California, assisted the Debtor in its restructuring effort. The Company estimated its assets and debts at $10 million to $50 million. BYSYNERGY LLC: Wants Case Dismissed as Property Foreclosed ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona will convene a hearing on December 6, 2010, at 10:00 a.m., to consider Bysynergy, LLC's motion to dismiss its Chapter 11 case. The Debtor is asking the Court to dismiss its case because it is now unable to effectuate a confirmed plan. The Debtor notes that there are no significant assets left for reorganization or liquidation because the creditors obtained stay relief on all real property and the said property was foreclosed. The Debtor says the dismissal of its Chapter 11 case is in the best interest of creditors and the estate. About Bysynergy, LLC Based in Sedona, Arizona, Bysynergy, LLC is a single purpose, single asset Delaware limited liability company, which primarily owns 103 single family dtached Finally Platted Lots in Yavapai County, known as Bella Terra on Oak Creek. The Debtor filed for Chapter 11 protection on June 25, 2008 (Bankr. D. Ariz. Case No. 08-07680). Jonathan P. Ibsen, at Jaburg & Wilk, PC, represents the Debtor as its counsel. Steven J. Brown, Esq., at Steve Brown & Associates, LLC, represents the Official Committee of Unsecured Creditors as counsel. When Bysynergy, LLC filed for protection from its creditors, it listed assets of between $10 million and $50 million, and debts of between $10 million and $50 million. CALIFORNIA BANK: Moody's Cuts Issuer Rating to B1 From Ba3 ---------------------------------------------------------- Moody's Investors Service announced that it has downgraded the ratings of 10 large U.S. regional banks after reducing its government support assumptions for these entities. The affected entities, whose ratings were placed on review for possible downgrade on July 27, 2010, had benefited from Moody's support assumptions since 2009. The banks affected by this action are subsidiaries of these 10 holding companies, listed alphabetically. This list includes the current bank-level deposit ratings following the removal of support. * BB&T Corporation -- bank deposits to Aa3 from Aa2 * Capital One Financial Corporation -- bank deposits to A3 from A2 * Fifth Third Bancorp -- bank deposits to A3 from A2 * KeyCorp -- bank deposits to A3 from A2 * PNC Financial Services Group, Inc. -- bank deposits to A2 from A1 * Popular, Inc. -- bank deposits to Baa3 from Baa2 * Regions Financial Corporation -- bank deposits to Baa3 from Baa1 * SunTrust Banks, Inc. -- bank deposits to A3 from A2 * U.S. Bancorp -- bank deposits to Aa2 from Aa1 * Zions Bancorporation -- bank deposits to Ba3 from Ba2 Additionally, as a result of the reduced support assumptions, the ratings outlook on the subsidiaries of American Express Company was changed. These issuers' guaranteed debt obligations issued under the FDIC's TLGP program were unaffected by the actions and remain Aaa. Rating Rationale "The downgrades reflect Moody's view that the likelihood of government support for these 10 institutions is lower now that the U.S. banking system has moved beyond the depths of the financial crisis," said Robert Young, Managing Director for Moody's North American Bank Ratings. "The failure of any one of these banks therefore would be unlikely to trigger contagion and systemic risk." In passing the Dodd-Frank Wall Street Reform and Consumer Protection Act this summer, the government signaled its intent to limit support for individual banks. This contrasts with its stance in early 2009, when it stated that support would be forthcoming for large regional banks that could not raise sufficient capital to satisfy government requirements under the Supervisory Capital Assessment Program. In reviewing its support assumptions, Moody's took into account the government's existing TARP investments in six large regional banks (Fifth Third, KeyCorp, Popular, Regions, SunTrust, and Zions). "Although the TARP investments are significant, all of these banks are currently devising plans to repay the government and are unlikely to keep the TARP in place over the long term," Young noted. The probability that the government would support any one of these institutions through a TARP conversion is therefore limited. Specific Bank Actions Differ BB&T: Moody's removed its assumption of support and placed BB&T's long-term ratings on review for further downgrade. During its review of BB&T's stand-alone credit strength, Moody's will focus on BB&T's ability to maintain its core pre-provision, pre-tax earnings in a still-challenging environment for U.S. banks, while assessing the risks associated with its above-average loan growth outside of commercial real estate as it shifts its portfolio away from that troubled asset class. Moody's will also consider the likely pace of further reductions in BB&T's sizable portfolio of foreclosed properties. In the event of a downgrade, a one-notch reduction is most likely. Were this to occur, BB&T's ratings would remain comparatively high, particularly among its Southeastern and large regional bank peers. Its senior holding company obligations are currently rated A1 and its long-term bank deposits (after the removal of systemic support) are rated Aa3. BB&T's Prime-1 short-term ratings, at both the bank and the holding company, are affirmed and are not on review. SunTrust: The downgrade resulting from the removal of systemic support assumptions was tempered by Moody's upgrade of SunTrust's stand-alone bank financial strength rating to C from C-. The combination of these two actions resulted in most of the holding company's ratings being confirmed (senior debt, Baa1), except for the preferred stock ratings, which were notched off the BFSR and were therefore upgraded with the BFSR (non-cumulative preferred to Ba1 from Ba2). However, the combination of the removal of systemic support assumptions and the upgrade of the BFSR did lead to a one-notch downgrade of the ratings on SunTrust Bank (long- term deposit rating to A3 from A2; short-term rating to Prime-2 from Prime-1). Following these rating actions, the outlook on all of SunTrust's ratings is stable. Regions: The removal of support assumptions resulted in a two- notch downgrade of Regions' bank-level debt and deposit ratings (long-term deposit rating to Baa3 from Baa1; short-term rating to Prime-3 from Prime-2) and a one-notch downgrade of the holding company's ratings (senior debt to Ba1 from Baa3; short-term rating to Not-Prime from Prime-3). Following these actions, the outlook on all of Regions' ratings remains negative. Capital One, Fifth Third, KeyCorp, Zions: The removal of support assumptions resulted in a one-notch downgrade of these four banks' bank-level debt and deposit ratings, but did not affect any of the holding companies' ratings, which were not on review. PNC, Popular, U.S. Bancorp: Moody's continues to ascribe support in the case of these three banks, but at a reduced level. The reduction in the support assumption resulted in a one-notch downgrade of these banks' bank-level debt and deposit ratings. The ratings of these entities' holding companies were not on review and were affirmed at their current level. While the lower probability of support does not provide any lift to their current stand-alone ratings, at a lower stand-alone rating some ratings lift might result. The ongoing assumption of support for US Bancorp and PNC is due primarily to their importance in the payment system and their significant national deposit share. The support assumption for Popular reflects its dominant position in Puerto Rico, together with that island's physical isolation and political importance. Rating Outlooks The rating outlook on four of these banks did not change. The outlook on Regions, Popular, and U.S. Bancorp remains negative, while that on Zions remains positive. However, the ratings outlook on six of the banks did change. On Capital One, Fifth Third, and KeyCorp it was changed to stable from negative; on PNC it was changed to positive from stable; and on SunTrust it was changed to stable after the upgrade discussed above. "These outlook changes reflect the banks' improving credit metrics and strengthened capital profiles relative to Moody's previous expectations, particularly at PNC and SunTrust," said Allen Tischler, Moody's Vice President and Lead Analyst for Fifth Third, KeyCorp, SunTrust, and PNC. Finally, the rating outlook on American Express Company's subsidiaries was changed to negative from stable as a result of the removal of the support assumption. The last rating action on BB&T Corporation, Capital One Financial Corporation, Fifth Third Bancorp, KeyCorp, PNC Financial Services Group, Inc., Popular, Inc., Regions Financial Corporation, SunTrust Banks, Inc., and U.S. Bancorp was on July 27, 2010, when Moody's placed on review for possible downgrade all the ratings that had benefited from systemic support at these banks. The last rating action on Zions Bancorporation and its subsidiaries was on August 3, 2010, when Moody's changed the rating outlook on the unsupported ratings of Zions Bancorporation and its subsidiaries to positive from negative, including those of its lead bank, Zions First National Bank. The last rating action on American Express Company was on February 17, 2010, when Moody's downgraded the ratings on certain U.S. banks' hybrid securities, in line with its revised Guidelines for Rating Bank Hybrids and Subordinated Debt, published in November 2009. Downgrades: Issuer: BB&T Financial, FSB -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: Banco Popular de Puerto Rico -- Issuer Rating, Downgraded to Baa3 from Baa2 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa2 Issuer: Branch Banking and Trust Company -- Issuer Rating, Downgraded to Aa3 from Aa2 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa3 from Aa2 -- Multiple Seniority Bank Note Program, Downgraded to a range of A1 to Aa3 from a range of Aa3 to Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to A1 from Aa3 -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: SunTrust Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3 from a range of (P)P-1, (P)A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Fifth Third Bank, Ohio -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to P-2 from P- 1 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: KeyBank National Association -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Multiple Seniority Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3, (P)Baa1 from a range of (P)P-1, (P)A2, (P)A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to a range of A3 to P-2 from a range of A2 to P-1 -- Senior Unsecured Deposit Program, Downgraded to P-2, A3 from P-1, A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: National City Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 Issuer: National City Bank of Indiana -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Kentucky -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Pennsylvania -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: PNC Bank, N.A. -- Issuer Rating, Downgraded to A2 from A1 -- OSO Senior Unsecured OSO Rating, Downgraded to A2 from A1 -- Multiple Seniority Bank Note Program, Downgraded to a range of A2, A3 from a range of A1, A2 -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Bank Note Program, Downgraded to A2 from A1 -- Senior Unsecured Medium-Term Note Program, Downgraded to (P)A2 from (P)A1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 -- Senior Unsecured Deposit Rating, Downgraded to A2 from A1 Issuer: Provident Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: U.S. Bank National Association -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Aa2, Aa3 from a range of Aa1, Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to Aa3 from Aa2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: U.S. Bank National Association ND -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: Capital One Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of P-2, A3, Baa1 from a range of P-1, A2, A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Capital One, N.A. -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: AmSouth Bancorporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 Issuer: AmSouth Bank -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Regions Bank -- Issuer Rating, Downgraded to Baa3 from Baa1 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Ba1 to P-3 from a range of Baa2 to P-2 -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa1 Issuer: Regions Financial Corporation -- Issuer Rating, Downgraded to a range of NP, Ba1 from a range of P-3, Baa3 -- Multiple Seniority Shelf, Downgraded to a range of (P)Ba3 to (P)Ba1 from a range of (P)Ba2 to (P)Baa3 -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Subordinate Shelf, Downgraded to (P)Ba2 from (P)Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Regions Financing Trust II -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 -- Preferred Stock Shelf, Downgraded to (P)Ba3 from (P)Ba2 Issuer: Regions Financing Trust III -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 Issuer: Union Planters Bank, National Association -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Union Planters Corporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Amegy Bank National Association -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: California Bank & Trust -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Nevada State Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Zions First National Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Upgrades: Issuer: SunTrust Bank -- Bank Financial Strength Rating, Upgraded to C from C- Issuer: SunTrust Banks, Inc. -- Multiple Seniority Shelf, Upgraded to (P)Baa3 from (P)Ba1 -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Preferred Capital I -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Real Estate Investment Corporation -- Preferred Stock Preferred Stock, Upgraded to Baa3 from Ba1 On Review for Possible Downgrade: Issuer: BB&T Capital Trust I -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust II -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust IV -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust V -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VI -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VII -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VIII -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Corporation -- Issuer Rating, Placed on Review for Possible Downgrade, currently A1 -- Multiple Seniority Medium-Term Note Program, Placed on Review for Possible Downgrade, currently a range of (P)A2, (P)A1 -- Multiple Seniority Shelf, Placed on Review for Possible Downgrade, currently a range of (P)A3 to (P)A1 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A2 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 Issuer: BB&T Financial, FSB -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Issuer: Branch Banking and Trust Company -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Issuer Rating, Placed on Review for Possible Downgrade, currently Aa3 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Multiple Seniority Bank Note Program, Placed on Review for Possible Downgrade, currently a range of A1 to Aa3 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Outlook Actions: Issuer: American Express Travel Related Svcs Co., Inc -- Outlook, Changed to Negative From Stable Issuer: American Express Centurion Bank -- Outlook, Changed to Negative From Stable Issuer: American Express Bank, FSB -- Outlook, Changed to Negative From Stable Issuer: American Express Credit Corporation -- Outlook, Changed to Negative From Stable Issuer: BB&T Capital Trust I -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust II -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust IV -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust V -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VI -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VIII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Corporation -- Outlook, Changed To Rating Under Review From Negative Issuer: Banco Popular de Puerto Rico -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Financial Corporation -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital II -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital III -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital IV -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital V -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital VI -- Outlook, Changed to Stable from Negative Issuer: North Fork Capital Trust II -- Outlook, Changed to Stable from Negative Issuer: Hibernia Corporation -- Outlook, Changed to Stable from Negative Issuer: National Commerce Capital Trust I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Banks, Inc. -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital IX -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital VIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital X -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Preferred Capital I -- Outlook, Changed To Stable From Negative Issuer: SunTrust Real Estate Investment Corporation -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Bank, Ohio -- Outlook, Changed To Stable From Rating Under Review Issuer: Fifth Third Bancorp -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust II -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust IV -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust V -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VI -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VII -- Outlook, Changed To Stable From Negative Issuer: KeyBank National Association -- Outlook, Changed To Stable From Rating Under Review Issuer: KeyCorp -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital I -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital II -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital III -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital V -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VI -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VIII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital IX -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital X -- Outlook, Changed To Stable From Negative Issuer: National City Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Indiana -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Kentucky -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Pennsylvania -- Outlook, Changed To Positive From Rating Under Review Issuer: PNC Bank, N.A. -- Outlook, Changed To Positive From Rating Under Review Issuer: Provident Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Preferred Capital Trust I -- Outlook, Changed To Positive From Stable Issuer: Merchants National Corp -- Outlook, Changed To Positive From Stable Issuer: National City Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust C -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust D -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust E -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust F -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust G -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust H -- Outlook, Changed To Positive From Stable Issuer: PNC Funding Corporation -- Outlook, Changed To Positive From Stable Issuer: Mercantile Bankshares Corporation -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust II -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust III -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust IV -- Outlook, Changed To Positive From Stable Issuer: National City Credit Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Financial Services Group, Inc. -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust I -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust II -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust III -- Outlook, Changed To Positive From Stable Issuer: U.S. Bank National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: U.S. Bank National Association ND -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: Capital One, N.A. -- Outlook, Changed To Stable From Rating Under Review Issuer: AmSouth Bancorporation -- Outlook, Changed To Negative From Rating Under Review Issuer: AmSouth Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financial Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust II -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust III -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Bank, National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Amegy Bank National Association -- Outlook, Changed To Positive From Rating Under Review Issuer: California Bank & Trust -- Outlook, Changed To Positive From Rating Under Review Issuer: Nevada State Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: Zions First National Bank -- Outlook, Changed To Positive From Rating Under Review Confirmations: Issuer: National Commerce Capital Trust I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Banks, Inc. -- Issuer Rating, Confirmed at Baa1 -- Multiple Seniority Shelf, Confirmed at (P)Baa3, (P)Baa2, (P)Baa1 -- Subordinate Regular Bond/Debenture, Confirmed at Baa2 -- Senior Unsecured Regular Bond/Debenture, Confirmed at Baa1 Issuer: SunTrust Capital I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital IX -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital VIII -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital X -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVII -- Preferred Stock Shelf, Confirmed at (P)Baa3 The principal methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, and Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007. CAPMARK FINANCIAL: Judge Approves $975M Settlement With Lenders --------------------------------------------------------------- Bankruptcy Judge Christopher S. Sontchi wrote a 93-page opinion deciding on the approval of $975 million settlement between Capmark Financial Group and its secured lenders on a prepetition loan, plotting a course out of Chapter 11 for the commercial mortgage-servicing firm. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, Judge Sontchi concluded that the settlement was better than the "lowest point of the range of litigation outcomes." He also said the settlement was "fair and reasonable" and in the "best interests" of "all parties in interest." Judge Sontchi said a lawsuit against the lenders had a "low probability" of success. The Official Committee of Unsecured Creditors, among other parties, objected to the settlement, asserting that the Debtors are not authorized to use unencumbered cash to pay prepetition claims prior to the confirmation of the Plan. The Committee was seeking authority to pursue lawsuits against the lenders. The Ad Hoc Group of Holders of Capmark's Unsecured Bank Debt relates that the Settlement is based on an unsupported assumption that there is less than a 4% chance that the estates will prevail on causes of action against the lenders and the secured ;lenders are over-secured. The Ad Hoc Group further asserts that the Settlement cannot be approved because it amounts to an impermissible sub rosa plan -- dictating terms of any future Chapter 11 plan by providing for the immediate payment of over 96% of the secured claim from $965 million of almost entirely unencumbered cash without any findings that that scheme is in the best interest of creditors or feasible. The Debtors nonetheless won approval of the settlement agreement with prepetition secured credit facility lenders holding claims under a prepetition $1.5 billion Secured Credit Facility. The Settling Lenders are: * Aurelius Capital Management, LP; * Brigade Capital Management, LLC; * Centerbridge Partners, L.P.; * Midtown Acquisitions L.P.; * Elliott Associates, L.P.; * Fir Tree, Inc.; * Golden Tree Asset Management LP; * Highbridge Principal Strategies, LLC; * QVT Financial LP and Silver Point Capital, L.P.; * The Royal Bank of Scotland plc; * JPMorgan Chase Bank, N.A.; and * any Prepetition Secured Lender, and those who do not put out of the settlement as beneficial owners of portions of the Debtors' prepetition Secured Credit Facility. In May 2009, the Debtors negotiated a straightforward refinancing transaction with the Lenders by which $1.5 billion of unsecured debt was refinanced by $1.5 billion of secured debt. The Debtors aver that the refinancing gave them time to either negotiate a comprehensive out-of-court restructuring or to negotiate transactions preserving value for their stakeholders and position themselves for Chapter 11 filing. The loan gave Capmark "an opportunity to weather the financial storm and maximized the value of the estate," said James Sprayregen, Esq., and Edward Sassower, Esq., attorneys for the lenders with law firm Kirkland & Ellis LLP.. The Official Committee of Unsecured Creditors claims that the loan was a fraudulent transfer because the Debtors were granting liens on their assets while receiving little to no value in exchange, all to the detriment of their estates and unsecured creditors. However, the Debtors maintain that they have thoroughly analyzed all potential avoidance claims that could be asserted against the Secured Lenders. After performing their detailed legal and factual investigations, the Debtors assert that they were able to negotiate the proposed Settlement with the Secured Lenders holding over 80% of their secured debt. Pursuant to the Settlement, the Debtors' estates are enhanced by at least $108 million and as much as $135 million (or 9% of $1.5 billion less the amount held by any Excluded Lender of Secured Lender that opts out of the Settlement) while avoidance actions against alleged insiders and other nonsettling beneficial holders of secured debt are preserved along with any actions against the indenture trustee that approved an amendment to CFGI's bond indenture. Additionally, the Debtors maintain that by retiring the Secured Claims, the settlement ends the accrual of interest on the Secured Claims at a rate of at least 4.75% per year, when it is nearly impossible to earn more than 0.5% interest per year on money deposited in the banks. 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. CAREFREE WILLOWS: Wants to Use Cash Collateral; Lender Objects -------------------------------------------------------------- Carefree Willows, LLC, seeks authority from the U.S. Bankruptcy Court for the District of Nevada to use the cash collateral of Union Bank of California, despite the latter's objection to the proposal. Lenard E. Schwartzer, Esq., at the Schwartzer & McPherson Law Firm, explains that the Debtor wants to use the revenue generated by its senior housing complex to maintain the senior housing complex, management and employees, provide services to the tenants, for payment of maintenance expenses, real estate taxes, insurance premiums, utilities incurred by the senior housing complex. By a deed of trust and assignment of rents between the Debtor and the Secured Creditor, the Debtor granted the Secured Creditor a security interest in, among other things, the revenue that Debtor collects. Accordingly, the monthly revenue collected from the residents at Carefree Willows senior housing complex constitute the Secured Creditor's cash collateral. The Debtor's anticipated revenue and expenses for the senior housing complex over the next 6 months are expected to be more than sufficient to pay for the maintenance expenses, tenant services, real estate taxes, insurance premiums, and utilities incurred by the senior housing complex. The Debtor asserts that the Secured Creditor is protected by a replacement lien in proceeds of the same postpetition collateral, to the extent that: 1) the Secured Creditor's prepetition interest is valid and nonavoidable, and 2) prepetition cash and proceeds are utilized by the Debtor in the Chapter 11 case. The priority of this replacement lien will be the same as its prepetition priority. The Debtor promises to provide the Secured Creditor monthly reports. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/CAREFREE_WILLOWS_budget.pdf Union Bank, the secured creditor, doesn't consent to any use of funds constituting its collateral. The Secured Creditor says that it is owed approximately $31,536,647. The Secured Creditor is represented by Snell & Wilmer L.L.P. Carefree Willows LLC is the owner of 300-unit Carefree Senior Living in Las Vegas. Carefree Willows filed a Chapter 11 petition on Oct. 22 (Bankr. D. Nev. Case No. 10-29932). Lenard E. Schwartzer, Esq., at Schwartzer & Mcpherson Law Firm, in Las Vegas, Nevada, serves as counsel to the Debtor. In its Schedules of Assets and Liabilities, the Debtor scheduled $30,604,014 in assets and $36,531,244 in liabilities. CENTAUR LLC: Valley View Downs L/C Extended Until January --------------------------------------------------------- Centaur, LLC, et al., sought and obtained final authorization from the U.S. Bankruptcy Court for the District of Delaware to amend the letter of credit in support of Valley View Downs and its affiliates' gaming license application, extending the term thereof until January 24, 2011. The Court also allowed the Debtors to obtain additional availability under the Intercompany Financing Order for payment of a fee to the L/C Issuer, Credit Suisse AG, Cayman Islands Branch. The Valley View Downs Debtors can pay the L/C Issuer up to $200,000 as compensation for the Fifth Amendment to the L/C. Centaur, LLC, can advance to Valley View Downs, LP, as Intercompany Financing the sum of up to $200,000 to be paid to the L/C Issuer as compensation for the Fifth Amendment to the L/C. The Valley View Downs Debtors have a gaming license application for Valley View Downs pending before the Pennsylvania Gaming Control Board of the Commonwealth of Pennsylvania. A mandatory requirement in the application process is that the Valley View Downs Debtors secure the Gaming License Application with a letter of credit in the amount of $50 million. Prior to filing for Chapter 11 protection, the Valley View Downs Debtors contracted with the L/C Issuer to provide a $50 million letter of credit to the Commonwealth for the purpose of securing the Debtors' Gaming License Application. The Court previously approved amendments to the L/C that provided extensions to the term of the L/C so that the Valley View Downs Debtors could preserve the development opportunity at Valley View Downs. The L/C was set to expire on October 26, 2010. The Debtors are currently seeking to sell the Valley View Downs opportunity through the auction and transfer of the equity interests in reorganized Valley View Downs, LP, Centaur PA Land Management, LLC, Centaur PA Land General Partner, LP, and Centaur PA Land, LP, to be issued on the effective date of the reorganization plan. The Valley View Downs Debtors negotiated with the L/C Issuer for a further extension of the L/C for a period of 90 days to January 24, 2011. The Valley View Downs Debtors have agreed to pay the L/C Issuer a $200,000 fee to be paid in cash by the Valley View Downs Debtors in exchange for the further extension of the L/C, provided that the Court continues the protections afforded by the final L/C court order to the L/C. About Centaur LLC Indianapolis, Indiana-based, Centaur, LLC, aka Centaur Indiana, LLC -- http://www.centaurgaming.net/-- is a company involved in the development and operation of entertainment venues focused on horse racing and gaming. The Company and its affiliates filed for Chapter 11 bankruptcy protection on March 6, 2010 (Bankr. D. Del. Case No. 10-10799). The Company estimated its assets and debts at $500 million to $1 billion as of the Petition Date. Gerard H. Uzzi, Esq., Michael C. Shepherd, Esq., and Lane E. Begy, Esq., at White & Case LLP, serve as counsel to the Debtors. A group of affiliates led by Valley View Downs, LP,. filed for Chapter 11 protection on October 28, 2009 (Bankr. D., Del. Case No. 09-13761). Valley View estimated assets and debts of $100 million to $500 million in its Chapter 11 petition. CHRISTIAN WHITTINGTON: Case Summary & Creditors List ---------------------------------------------------- Joint Debtors: Christian Whittington Gretchen Whittington 12123 Briar Leaf Court Parker, CO 80138 Bankruptcy Case No.: 10-37366 Chapter 11 Petition Date: October 28, 2010 Court: U.S. Bankruptcy Court District of Colorado (Denver) Judge: Howard R. Tallman Debtors' Counsel: Phillip Jones, Esq. 200 N. 6th Street P.O. Box 338 Grand Junction, CO 81502 Tel: (970) 242-6262 E-mail: pjones@wth-law.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Joint Debtors' 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cob10-37366.pdf CIRCUIT CITY: No Class Claims Under Liquidation Plan ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist reports that, in an opinion on Oct. 29, a district judge in Richmond, Virginia, upheld the bankruptcy judge by ruling that class claims were not preferable under the facts of the Circuit City, Inc., case. As a result, the distribution to creditors under the confirmed Circuit City Chapter 11 plan won't be diluted by claims from workers in California, Mr. Rochelle relates. Circuit City employees alleging violations of the Worker Adjustment and Retraining Notification Act sought to be treated as a class in the Company's bankruptcy case, saying there is no reason for individual members to each file their own claims. According to Mr. Rochelle, the bankruptcy judge, however, ruled that allowing or disallowing individual claims was the preferable method for dealing with the labor-law claims. Mr. Rochelle notes that the district judge didn't reach the question of whether class claims are even permissible in bankruptcy cases. The issue has divided the courts. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code on November 10, 2008 (Bankr. E.D. Va. Lead Case No. 08-35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. In May 2009, Systemax Inc., a multi-channel retailer of computers, electronics, and industrial products, acquired certain assets, including the name Circuit City, from the Debtors through a Court- approved auction. CONTECH CONSTRUCTION: Completes "Balance Sheet Restructuring" ------------------------------------------------------------- Contech Construction Products Inc. announced November 1 that it has successfully completed a balance sheet restructuring with its debt and equity holders, which reduces the Company's outstanding debt by approximately $240 million and greatly enhances Contech's financial position to continue to invest in innovation and pursue meaningful growth opportunities. Additionally, the Company disclosed that as part of the restructuring, Goldman Sachs Mezzanine Partners (GSMP) will become Contech's majority owner. Funds advised by Apax Partners will continue to hold an equity stake in the business. "This balance sheet restructuring was essential for Contech as it greatly reduces our debt, increases our liquidity and puts us in a stronger position to invest in our future. We are grateful to have the support of Goldman Sachs, our equity partner Apax Partners, our lenders and all other owners of our business. We look forward to working with them over the coming years, as we drive innovation throughout the industry and aggressively go after new markets and key customer accounts, while continuing to expand our global footprint," stated Ron Keating, President and Chief Executive Officer of Contech. Under the terms of the balance sheet restructuring, the Company has permanently removed 100% of the principal amount and accrued interest owed on its mezzanine notes due 2014, representing a total debt reduction of approximately $240 million. Additionally, the Company's senior secured credit facility with Wells Fargo Bank and a syndicate of lenders has also been amended with modified financial covenants and revised interest rates. The Company's revolving credit facility has been extended to January 31, 2013, the same date as its term loan. Joseph Gleberman, Managing Director of Goldman, Sachs & Co. stated, "Contech is a well-run organization with strong and respected brands. We have consistently been impressed with the Company's leadership, especially through these most challenging times. Contech is well positioned to help in the rebuilding of our nation's infrastructure. We look forward to working with the management team, helping to shape their vision and delivering long-term sustainable value for all shareholders." The Company's legal advisor on this restructuring is Kirkland & Ellis, LLP and Perella Weinberg Partners LLP served as the financial advisor. About CONTECH Construction CONTECH Construction Products Inc. is a leading provider of site solution products and services for the civil engineering industry. CONTECH's product portfolio includes bridges, drainage, retaining walls, sanitary sewer, stormwater, erosion control and soil stabilization products. See http://www.contech-cpi.com As reported in the TCR on October 27, 2010, Standard & Poor's Ratings Services lowered its corporate credit rating on Contech Construction Products Inc., to 'CC' from 'CCC'. The ratings, including the issue-level ratings on the senior secured bank facilities, remain on CreditWatch, where they had been placed with negative implications on June 18, 2010. "The downgrade and continued CreditWatch listing reflects S&P's view that Contech will likely not be in a position to remain in compliance with its senior secured bank credit facilities because of the combination of still-weak construction end markets, restrictive bank facility covenants, constrained operating results, and high debt levels," said Standard & Poor's credit analyst Thomas Nadramia. As a result, S&P thinks Contech will likely need to seek amendments or waivers of its covenant requirements and possibly pursue restructuring of its debt obligations. The company faced more restrictive bank credit agreement covenants which stepped down on June 30, 2010. CIT GROUP: DBRS Keeps 'B' Issuer Rating After Q3 Results -------------------------------------------------------- DBRS has commented that the ratings of CIT Group, Inc., including its Issuer Rating of B (high) are unaffected by the Company's announcement of 3Q10 earnings results. The trend on all long-term ratings is Positive. For 3Q10, CIT reported net income of $131.5 billion, on a GAAP basis, the third consecutive quarter of profitability. Earnings continue to benefit from pre-tax fresh start accounting (FSA)- related items, which totaled $266 million in the quarter. On an underlying basis, excluding FSA accretion income, CIT's pre-tax loss totaled $70.3 million; however, the loss narrowed from $166 million in the prior quarter. DBRS views the smaller underlying loss as demonstrating the Company's continuing progress towards restoring underlying profitability. Management's continued focus on removing excess operating costs and reducing high-cost debt is having a positive impact on profitability. Indeed, operating expenses were lower than 2Q10 and interest expense declined 10% as a direct result of these actions. Moreover, underlying earnings benefited from the favorable movement in credit trends resulting in a 32% reduction in provisioning for credit losses compared to the prior quarter. While business fundamentals improved, high funding costs continue to compress margins providing a noteworthy headwind limiting underlying earnings ability. Importantly, the results evidence good momentum in CIT's core businesses, with funded volumes in excess of $1.0 billion and volumes increasing in three of the Company's four commercial businesses. DBRS sees this as further confirmation that the Company continues to advance its plans designed to restore the franchise and customer confidence in the Company post- reorganization. Credit performance continues to show signs of stabilization. On a pre-FSA basis, gross charge-offs declined $19 million from the prior quarter to $233 million, or 2.97% of average finance receivables. Non-accrual loans, excluding FSA accounting, decreased 14.8% to $2.6 billion. Importantly, the pace of new inflows into non-accrual status decreased substantially, suggesting longer-term improvement in asset quality. As a result of the improving loan performance, provisions for loan losses decreased 32% quarter-on-quarter to $165.2 million. Coverage ratios, including the FSA accretable discount, remain solid at 115% of non-accrual loans at September 30, 2010, despite the decline in provisioning. Moreover, the remaining $583.3 million of non-accretable discount (marks) on the balance sheet at the end of 3Q10 provides additional cushion from potential losses on the pre-emergence loan portfolio. Given the uneven recovery, which continues to pressure small and middle market businesses, which are CIT's core clientele, DBRS views the trends in the performance of the loan portfolio as illustrating the Company's sound underwriting and servicing abilities, as well as the continued progress in removing risk from the balance sheet. CIT's funding profile continues to improve. Year-to-date, CIT has repaid $4.5 billion of high cost first lien debt and refinanced the remaining $3.0 billion at more favorable terms. In addition, in September and early October, CIT announced the redemption of $1.4 billion of the 10.25% second lien Series B Notes, which will be completed in 4Q10. Liquidity remains solid with total cash increasing to $11.5 billion, or 21.7% of total assets. Capital ratios substantially exceed regulatory minimums and have benefited from organic capital generation and further reductions in risk- weighted assets, owed to ongoing removal of non-core assets. CIT reported a Tier 1 capital ratio of 18.7% and a total capital ratio of 19.6% at the end of 3Q10. Moreover, leverage continues to improve with debt-to-equity of 4.1 times at September 30, 2010. The Positive trend reflects DBRS's expectations that the Company should continue to make progress in improving and diversifying its funding profile, while restoring underlying profitability. CLYDE DAVIS: Case Summary & 14 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Clyde Randy Davis 218 Saddle Mountain Road Rome, GA 30161 Bankruptcy Case No.: 10-44245 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Northern District of Georgia (Rome) Judge: Mary Grace Diehl Debtor's Counsel: Ian M. Falcone, Esq. THE FALCONE LAW FIRM PC 363 Lawrence Street Marietta, GA 30060 Tel: (770) 426-9359 E-mail: attorneys@falconefirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 14 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ganb10-44245.pdf CLYDE WILLIAMS: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Clyde R. Williams Linda C Williams 930 Hurleston Lane Atlanta, GA 30302 Bankruptcy Case No.: 10-92290 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Northern District of Georgia (Atlanta) Judge: Mary Grace Diehl Debtors' Counsel: William T. Payne, Esq. 150 E. Ponce de Leon Avenue, Suite 200 Decatur, GA 30030 Tel: (404) 377-1100 E-mail: wtplaw1100@aol.com Scheduled Assets: $1,521,505 Scheduled Debts: $4,703,000 A list of the Joint Debtors' five largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ganb10-92290.pdf CONTINENTAL COMMON: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Continental Common, Inc. 1750 Valley View Lane, Suite 440 Dallas, TX 75234 Bankruptcy Case No.: 10-37542 Chapter 11 Petition Date: October 28, 2010 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Melissa S. Hayward, Esq. FRANKLIN SKIERSKI LOVALL HAYWARD LLP 10501 N. Central Expry, Suite 106 Dallas, TX 75231 Tel: (214) 789-9977 Fax: (214) 221-7993 E-mail: MHayward@FSLHlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Craig Landess, vice president. CONTINENTAL TRUSTEES: S&P Assigns 'BB' Rating to $200 Mil. Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' rating to Continental Trustees Ltd.'s $200 million fixed-/floating-rate step-up notes due 2040. The transaction structure is intended to mirror the credit risk of the underlying collateral in the form of a participation interest in a Banco Continental subordinated loan. S&P considers the credit quality of the underlying loan to be below S&P's long-term counterparty rating on the bank, reflecting both the incremental risk to creditors related to the subordinated position of these notes to the bank's senior creditors and the bank's flexibility in making interest payments. (S&P's ratings on this type of hybrid security generally incorporate the risk of nonpayment despite the permissibility of such nonpayment under the terms of the issue.) Banco Continental may opt to suspend interest payments on this note issue if it determines that canceling such interest payments is necessary or desirable to enable the bank to remain in compliance during the next 12 months with its minimum regulatory capital requirements, in accordance with Peruvian banking laws and regulations. In addition, interest on this security will be mandatorily suspended if Banco Continental is not in compliance with its applicable regulatory capital requirements, if the sector's regulatory body (the Superintendency of Banks, Insurance and Private Pension Fund Administrators) mandates a prohibition of such interest payments, or if there are no distributable profits for the bank as of the latest fiscal year end. The transaction rating reflects S&P's view that despite this flexibility and the possibility for a suspension in the payment of interest, S&P views such suspension as remote. If circumstances lead to an increased risk of a suspension of payments, S&P would consider further widening the difference between the transaction rating and the bank's counterparty credit rating. Standard & Poor's 'BBB-/A-3' counterparty credit ratings on Banco Continental primarily reflect the bank's strong market position as the second-largest player in the Peruvian financial system, its sound management team, and a solid financial risk profile. The bank's financial strength is evidenced mainly by its ample, stable, and low-cost deposit base, which represents the bank's main funding source; its high profitability and liquidity; healthy asset quality indicators; and good operating efficiency, enhanced by the involvement one of its two main owners, Banco Bilbao Vizcaya Argentaria S.A. (AA/Negative/A-1+). Partially offsetting these strengths are the bank's exposure to Peru and the high competitive pressures in that country's financial system. The rating also reflects the role of Credit Suisse AG as lender under the subordinated loan. According to the transaction documents, Credit Suisse is responsible for transferring all payments received under the loan within 24 hours to the transaction trust, thereby mitigating any commingling risk. The interest rate on the notes will mirror that of the underlying collateral and will be fixed for the first 10 years, after which the notes will accrue interest at a floating rate equal to LIBOR plus a spread. As long as the step-up in the interest rate at year 10 does not exceed 200 basis points, S&P will characterize the loan as having "intermediate strong" equity credit until 2020 due to the loan's flexibility of payments, long-dated maturity, and significant subordination. Ratings List Banco Continental Rating ----------------- ------ Counterparty credit rating BBB-/Positive/A-3 Rating Assigned Continental Trustees Ltd. $200 million fixed-/floating-rate step-up junior subordinated notes due 2040 BB CREAM MINERALS: Lender's Forbearance Conditioned on Minco Deal -------------------------------------------------------------- Cream Minerals Ltd. on Monday said Frank Lang, its chairman and director, as well as its major creditor, has agreed that the Company may defer for two years the repayment of C$1 million of debt if it accepts Minco Silver Corporation's offer to acquire a stake in the Nuevo Milenio silver-gold exploration project. Cream owes Mr. Lang and a company controlled by him an aggregate of nearly C$1.3 million. Cream disclosed that Minco on October 14, 2010, offered to purchase an initial 50% interest in Nuevo Milenio for C$5 million in cash, plus a grant to Minco of an option to acquire an additional 20% interest by incurring work expenditures of a further C$5 million. Assuming it fulfils its own expenditure requirements, Cream would retain a 30% interest in the upside potential of Nuevo Milenio. The disclosure was part of Cream's announcement that it has mailed a supplementary directors' circular in response to the unsolicited offer from Endeavour Silver Corp. to Cream shareholders to purchase all of the issued and outstanding shares of Cream for C$0.12 per Share. Cream said it was in talks with Minco over the terms of a deal when Endeavour announced its buyout offer. Cream said the Circular contains no recommendation of the Cream board of directors as to whether Cream shareholders should accept or reject the Endeavour Offer. Shareholders should consider the information contained in the Circular carefully and make their own decisions. Shareholders who are in doubt about how to respond to the Endeavour Offer, should consult their investment dealer, stockbroker, lawyer or other professional advisors. Cream said an Independent Committee has concluded that the agreement contemplated by the Minco Offer and Mr. Lang's forbearance agreement together would constitute a viable alternative to the Endeavour Offer. With the Minco and Lang agreements in place, Cream would be recapitalized, with sufficient cash to pay its debts to third party creditors and comfortably meet its expected working capital needs for at least two years. In addition, Cream's most valuable asset, the Nuevo Milenio project, would be in the hands of Minco, which has a skilled senior management team with a strong global track-record in major mining organizations, and Cream would retain a significant interest in the project. Cream also said Capital West Partners, financial advisor to the Independent Committee, has advised the Independent Committee that it regards the Endeavour Offer as superior to the Minco Offer from a financial point of view. Nevertheless, Shareholders who wish their Company to remain in the business of mineral exploration and to participate in Nuevo Milenio's upside potential, with the possibility that they may over the longer term achieve a better return by retaining their Shares, may prefer to reject the Endeavour Offer. According to Cream, its Board is of the view that given the limited financial resources of the Company and in accordance with the Company's business plan, the acceptance of the Minco Offer is in the best interests of the Company. If on November 9, 2010, the expiry date of the Endeavour Offer, Shares representing less than 50.1% of the outstanding Shares, calculated on a fully-diluted basis, are tendered to the Endeavour Offer, the Board intends to accept the Minco Offer on November 10, 2010. A full-text copy of Cream's statement is available at no charge at http://ResearchArchives.com/t/s?6d41 Based in Vancouver, British Columbia, Cream Minerals Ltd. (CA:CMA) (frankfurt:DFL) -- http://www.creamminerals.com/-- is a mineral exploration company with properties in Canada, Mexico and Sierra Leone, Africa. While the Company holds five properties, its current focus is the Nuevo Milenio silver-gold project. CROWN CASTLE: Fitch Upgrades Issuer Default Rating to 'BB' ---------------------------------------------------------- Fitch Ratings has upgraded the Issuer Default Ratings of Crown Castle International Corp. and its subsidiaries to 'BB' from 'BB-'. In addition, Fitch has upgraded the senior unsecured debt at CCIC to 'BB-' from 'B+'. The remaining debt ratings at CCIC's subsidiaries have been affirmed. Fitch has upgraded, affirmed these ratings: CCIC -- IDR to 'BB' from 'BB-'; -- Senior Unsecured Debt to 'BB-' from'B+'. Crown Castle Operating Company -- IDR to 'BB' from 'BB-'; -- Senior Secured Credit Facility at 'BB+'. CC Holdings GS V LLC -- IDR to 'BB' from 'BB-'; -- Senior Secured Notes at 'BBB-'. The Rating Outlook for CCIC and its subsidiaries is Stable. The ratings upgrade for Crown reflects the continued strengthening of the company's credit and operating profile evidenced by the completed refinancing of its capital structure, the improved cash generation and decreased leverage. Annualized leverage as of the third quarter of 2010 was 5.5 times. The ratings are supported by the strong recurring cash flows associated with its leasing operations and the significant operating leverage inherent within the business model that should enable the company to further increase its robust EBITDA margin. The rating profile also benefits from Crown's focus on seeking additional growth opportunities in the U.S. wireless industry versus emerging international markets, thus leading to less exposure to country risk, less favorable market characteristics like low entry barriers and lower credit quality lessees. Concerns include Crown's exposure to Nextel related sites that will likely be decommissioned in the future. However, Fitch believes 1) This exposure is limited to the mid- to low-single digits over a multi-year period; 2) Crown has less exposure to Nextel sites than other tower operators; 3)Sprint Nextel is still at the early stages for network planning, thus the exact number of sites that are ultimately decommission is highly uncertain. Sprint Nextel will also likely need to upgrade the majority of its cell site leases with amendments for its network modernization, which will provide an offset to any cancelled leases. Additionally, Fitch expects growth from other carriers will more than make up for any loss of revenue from Nextel related sites. The key factor in future revenue and cash flow growth for Crown as well as the rest of the tower industry, is the growth with mobile broadband services. With the proliferation of innovative handset and other devices, data traffic has grown exponentially in recent years for wireless operators. Even though operators have begun to use data caps on plans to better match revenues with growth in data, as operators deploy 4G networks, the data 'buckets' will be quite robust and as new devices come to the market, the tower industry will greatly benefit from the need by operators to upgrade networks to match increased demand. Consequently, with the wireless industry at the early stages of broadband data, Fitch believes the tower operators are well positioned to drive further lease-up opportunities and have significant upside to longer-term leasing revenue and cash flow growth, which could exceed current industry expectations. This has already been supported by one of the national operators reaching an agreement to amend terms on 100% of its leases for additional 4G infrastructure in exchange for a higher monthly rental payment. Crown maintains significant flexibility with prioritizing the use of its liquidity and discretionary cash flow. As of the third quarter 2010, cash was $279 million pro forma for the partial interest rate swap settlement and share repurchases. Crown's $400 million revolving facility that matures in 2013 remains undrawn, and the company has significant flexibility under its covenants. Free cash flow for the last twelve months was approximately $380 million, including $97 million in spending for land purchases, which is highly discretionary. The focus on buying or extending its land leases, which Crown now owns land underneath its tower sites generating 34% of its site rental gross margin, also benefits the longer-term credit profile by increasing margin certainty and decreasing its leasing obligation. Fitch accounts for operating leases within its adjusted debt metrics. In 2011, Crown has indicated recurring cash flow will be in the range of $721 million to $741 million, which Fitch believes Crown should at least meet or exceed the high-end of this target. Crown has fully addressed the refinancing risk with its capital structure as the company does not have any material maturities until 2014 when its $627 million term loan matures. Term loan amortization is minimal at 1% annually. Crown does have two interest rate swaps with a combined notional value of $2.8 billion maturing in 2011 with a present value of $438 million. Fitch expects the company to proactively address the remaining obligations during the upcoming quarters. During the fourth quarter of 2010, Crown used $52 million in cash to settle $303 million of notional interest rate swap. With the company nearing its net leverage target of 5x, additional debt reduction is not likely. Longer-term, Fitch believes Crown could continue to delever through cash flow growth into the 4x range depending on whether attractive material acquisitions or share repurchase opportunities present themselves. Additionally, with the potential conversion to a REIT in the 2014-2015 timeframe, Fitch believes Crown has investment grade aspirations as part of the considerations with a REIT conversion, which suggests that the company would potentially pursue less aggressive long-term financial policies. The 'BBB-' rating for the secured debt at GS V reflects the superior recovery and over-collateralization of the debt at the operating company level. The ratings for the secured credit facility at CCOC reflect the lower collateral support from its pledged assets as well as expected benefits from the over- collateralization of the secured assets at Towers LLC, GS V and Global Signal Holdings III LLC. The ratings of the unsecured debt at the holding company level reflect the structural subordination and reduced recovery prospects within the capital structure. The distinction in rating differences between Fitch's existing structured and new corporate debt ratings reflects the structural enhancements with the CMBS issuances including the protection of interest payments during a bankruptcy process. Longer-term, Fitch believes Crown's ratings have upward potential from further operational and credit profile improvements. Key rating drivers for Crown include (1) The stability and operating leverage within its leasing operations; (2) Growth in broadband data leading to increased lease-up opportunities; and (3) Maintaining less aggressive financial policies than in the past. DANMART PROPERTIES: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Danmart Properties LLP P.O. Box 44033 Phoenix, AZ 85064 Tel: (602) 285-9010 Bankruptcy Case No.: 10-35045 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: George B. Nielsen, Jr. Debtor's Counsel: Stanford E. Lerch, Esq. LERCH & DEPRIMA PLC 4000 N. Scottsdale Road, Suite 107 Scottsdale, AZ 85251 Tel: (480) 212-0700 Fax: (480) 212-0705 E-mail: slerch@ldlawaz.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Dan Unger, manager. DAVID MARCOE: Wants Access to Lenders' Cash Collateral ------------------------------------------------------ David B. Marcoe and Lori L. Marcoe ask the U.S. Bankruptcy Court for the Western District of Washington for authorization to use cash collateral of Sterling Savings Bank, and First Horizon and Chase. The Debtors need access to all rents related to the eleven unit project at 3116-3128 Franklin Ave. E, Seattle, and Kismet Two LLC. The Debtors will use the cash collateral to preserve, maintain, and protect the real properties; and provide management compensation to the Debtors for the costs of maintaining the properties and dealing with tenant issues. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the secured lenders the balance of the rents with the first position secured lien in the property. As further adequate protection, the Debtor will: i) continue to maintain insurance on all real properties; ii) not incur any indebtedness with priority over the liens of the bank; iii) pay or preserve the funds allocated for payment of real property taxes and insurance expenses. The Debtors filed a motion to shorten time for approval of interim use of cash collateral, requesting a hearing on November 4, 2010, or at the Court's earliest convenience. The Debtors propose a final hearing on their request to access the secured lenders' cash collateral on November 19 at 9:30 a.m. Objections, if any, are due November 12. About David Brian Marcoe Seattle, Washington-based David Brian Marcoe and David Brian Marcoe and Lori Lucille Marcoe are owners of a number of townhouses, duplexes and residential real properties located in King County. Their 18 primary business was the design and construction of new construction projects. The Company filed for Chapter 11 protection on September 15, 2010 (Bankr. W.D. Wash. Case No. 10-20975). Cynthia A. Kuno, Esq., at Hanson Baker Ludlow Drumheller PS, assists the Debtors in their restructuring effort. The Debtor disclosed $10,339,222 in assets and $10,573,203 in liabilities. DELTA AIR: Court OKs Sharing of Info. on Retiree Benefit Plans -------------------------------------------------------------- Counsel to Delta Air, Steven C. Krause, Esq., at Davis Polk & Wardwell LLP, in New York, certified to the U.S. Bankruptcy Court for the Southern District of New York that as of August 30, 2010, there were no outstanding unresolved answer, objection or other responsive pleading to the Reorganized Debtors' proposed order specifically authorizing disclosure of necessary information to facilitate operation of retiree benefit plans by a retiree voluntary employee benefit association. Accordingly, Judge Cecilia G. Morris ruled that Delta's health care benefit plans and other covered entities and their business associates that do business with the Delta Plans in connection with health care, prescription drug, vision care or dental benefits -- the "Delta Vendors" -- are authorized, but not required, to share information with the Covered Entities and their Business Associates that do business with, or that are being solicited to do business with, the VEBA in connection with health care, prescription drug, vision care or dental benefits for Delta Air Lines, Inc. pilot retirees, their spouses, dependents and survivors. This includes the VEBA's broker, third party plan administrator, and plan or insurance providers -- the "VEBA Outside Vendors". (1) The Delta Plans and Delta Vendors are specifically authorized, but not required, to share protected health information as defined under the Health Insurance Portability and Accountability Act of 1996 -- HIPAA PHI -- held by the Covered Entities, with the VEBA Outside Vendors solely for the purpose of assisting the VEBA with the implementation of its health care, prescription drug, vision care and dental benefit plans which will be offered to Delta pilot retirees, spouses, dependents and survivors. Each VEBA Outside Vendor must execute written confidentiality agreements satisfactory to the Delta Plans and Delta Vendors in their sole discretion, in which the VEBA Outside Vendors agree (A) to preserve the confidentiality of the HIPAA PHI as provided under laws applicable to Business Associates or Covered Entities; (B) to use the HIPAA PHI only as permitted under laws applicable to Business Associates or Covered Entities; and (C) to comply with and adhere to other confidentiality, security and privacy requirements that Debtors, the Delta Plans or the Delta Vendors may require -- the "Confidentiality Restrictions". (2) The Delta Plans and the Delta Vendors are specifically authorized, but not required, to provide the VEBA Outside Vendors that agree in written confidentiality agreements to abide by the Confidentiality Restrictions with some or all of these information in its or their possession: A. Census data, including individual enrollment information, regarding Delta pilot retirees, their spouses, dependents, and survivors. The Delta Plans and Delta Vendors are also authorized, but not required, to provide some or all of the specified information to the VEBA Outside Vendors with respect to future pilot retirees and their dependents, but only if the future pilot retirees and their dependents are offered an enrollment opportunity in the healthcare, vision, dental and prescription drug plans of the VEBA. In addition, the enrollment data may be provided for the previous 24 months, as well as current enrollment data. B. Aggregate medical and prescription drug claims amounts and related aggregate participant census data regarding Delta pilot retirees their spouses, dependents, and survivors, specifically including aggregate claims experience for the previous 24 months categorized by pilot retirees that are (i) under age 65, (ii) age 65 or older, and (iii) under age 65 and on Medicare, if known, and further categorized between aggregate medical and prescription drug coverage by each month; monthly enrollment counts for pilot retirees and total number of lives (pilot retirees + dependents) by month, for the previous 24 months categorized by those pilot retirees that are (i) under age 65, (ii) age 65 or older and (iii) under age 65 and on Medicare, if known. Delta and the Delta Vendors are specifically authorized, but not required, to provide the VEBA Outside Vendors with individual pilot retiree or dependent high claims experience, indicated by the plan name, for up to the previous 24 months. The high claims experience includes a list of all pilot retiree or dependent claimants with over $50,000 of paid claims in up to the last 24 months and the aggregate amount of their claims and the specific prognosis/diagnosis information (if available) for the claimants; provided, however, that the information on individual pilot retiree and dependent high claims will be supplied without individual names associated with the claims, simply by gender, date of birth (month and year only), and address (city, state and 5-digit zip code only). C. Aggregate dental claims and related aggregate census data regarding Delta pilot retirees (and other employees identified by the VEBA Outside Vendor who are eligible for the HCTC because they are receiving payments from the PBGC), their spouses, dependents, and survivors, specifically including aggregate claims experience for the previous 24 months categorized by those pilot retirees that are (i) under age 65, and (ii) age 65 or older; monthly pilot enrollment counts and total member counts (pilot retirees + dependents) for the previous 24 months, categorized by those pilot retirees that are (i) under age 65, and (ii) age 65 or older. D. Vision care claims and related census data regarding Delta pilot retirees, their spouses, dependents, and survivors, specifically including aggregate claims experience for the previous 24 months categorized by those pilot retirees that are (i) under age 65, and (ii) age 65 or older; monthly pilot enrollment counts and total member level (pilot retirees + dependents) for the previous 24 months, categorized by those pilot retirees that are (i) under age 65, and (ii) age 65 or older. Judge Morris held that disclosure of HIPAA PHI by the Delta Plans and Delta Vendors as authorized and restricted for the purpose of facilitating the establishment, enrollment and functioning of the VEBA healthcare, vision, prescription drug and dental plans is disclosure that is required by law for purposes of 45 CFR 164.512(e) and, as such, the Delta Plans and Delta Vendors are permitted to disclose the HIPAA PHI without the approval of the Delta Plans' participants and without liability; and none of the Reorganized Debtors, the Delta Plans, the Delta Vendors, DP3, Inc. or any of their affiliates, members, officers, directors, employees, advisors, actuaries, accountants, attorneys, financial advisors, investment bankers, consultants, professionals or agents, will have or incur any liability for any act or omission in connection with, related to or arising out of, any disclosures, except for willful misconduct, ultra vires acts or gross negligence. About Delta Air Lines Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- provides scheduled air transportation for passengers and cargo throughout the United States, and around the world. The Company's route network is centered on the hub system it operate at airports in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo- Narita. The hub operations include flights, which gather and distribute traffic from markets in the geographic region surrounding the hub to domestic and international cities and to other hubs. The network is supported by a fleet of aircraft, which is varied in terms of size and capabilities. On December 31, 2009, the Company's wholly owned subsidiary Northwest Airlines, Inc., merged with and into Delta. The wholly owned subsidiary of the Company is Northwest Airlines Corporation. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Stable/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DELTA AIR: Reports $929 Million Profit in Sept. 30 Quarter ---------------------------------------------------------- Delta Air Lines (NYSE: DAL) reported financial results for the September 2010 quarter. Key points include: * Delta's net income for the September 2010 quarter was $929 million, or $1.10 per diluted share, excluding special items. This is an $878 million improvement year over year. * Delta's GAAP net income was $363 million, or $0.43 per diluted share, for the September 2010 quarter. * Results include $185 million in profit sharing expense, in recognition of Delta employees' achievements toward meeting the company's financial targets, bringing total profit sharing expense for the year to date to $275 million. * Delta executed $750 million in debt reduction and delevering initiatives during the quarter and ended the September 2010 quarter with $5.5 billion in unrestricted liquidity. "This quarter's profit is evidence of the success of our merger. We are making progress toward our goal of consistent profitability with 10-12% annual operating margins and we expect to be profitable for the December quarter," said Richard Anderson, Delta's chief executive officer. "These results would not have been possible without the hard work and dedication of the Delta people and we are pleased to recognize their contributions with an additional $185 million this quarter for our profit sharing program." Revenue Environment Total operating revenue for the September 2010 quarter was $9.0 billion, an increase of $1.4 billion, or 18%, compared to the same period last year. * Passenger revenue increased 19%, or $1.3 billion, compared to the prior year period on 2% higher capacity. Passenger unit revenue (PRASM) increased 16%, driven by a 16% improvement in yield. * Cargo revenue increased 28%, or $50 million, on both higher volume and yield. * Other, net revenue increased 9%, or $75 million, primarily due to baggage fees. Comparisons of revenue-related statistics are: Increase(Decrease) 3Q10 versus 3Q09 ------------------------------- Change Unit Passenger Revenue 3Q10 ($M) YOY Revenue Yield Capacity ----------------------------------------- Domestic $3,259 12% 9% 11% 3% Atlantic 1,698 25% 25% 23% 1% Pacific 881 54% 45% 36% 6% Latin America 366 24% 16% 15% 7% ------- Total mainline 6,204 21% 18% 18% 3% Regional 1,571 12% 13% 14% (1)% ------- Consolidated $7,775 19% 16% 16% 2% Delta's revenue performance exceeded our expectations for the quarter, with especially strong performance from our international markets," said Ed Bastian, Delta's president. "We see demand strength through the holiday period and expect solid year over year unit revenue growth for the December quarter." Cost Performance In the September 2010 quarter, Delta's operating expense increased $577 million year over year due to higher fuel price, profit sharing expense and maintenance expense, which were partially offset by incremental merger cost synergies. Consolidated unit cost (CASM(2)), excluding fuel, profit sharing and special items, was flat in the September 2010 quarter on a year-over-year basis, on 2% higher capacity. Consolidated CASM increased 6% due to higher fuel price and profit sharing expense. Non-operating expenses excluding special items decreased $23 million on lower debt discount amortization from Delta's debt reduction initiatives. Including special items, non-operating expenses were $254 million higher than the prior year quarter due to a primarily non-cash loss on extinguishment of debt, including the write-off of unamortized debt discount recorded as part of the Northwest merger. Fuel Price and Related Hedges Delta hedged 51% of its fuel consumption for the September 2010 quarter, for an average fuel price(3) of $2.29 per gallon. The table below represents fuel hedges Delta had in place as of Oct. 15, 2010: 4Q10 1Q11 2Q11 3Q11 -------------------------- Call options 21% 20% 32% 19% Collars 20% 19% 9% 12% Swaps 23% 17% 5% 3% -------------------------- Total 64% 56% 46% 34% Average crude call strike $83 $83 $85 $86 Average crude collar cap 87 90 84 89 Average crude collar floor 75 75 73 76 Average crude swap 77 79 81 81 Liquidity Position As of Sep. 30, 2010, Delta had $5.5 billion in unrestricted liquidity, including $3.9 billion in cash and short-term investments and $1.6 billion in undrawn revolving credit facilities. During the September 2010 quarter, operating cash flow was $515 million, driven by the company's profitability partially offset by the normal seasonal decline in advance ticket sales. Free cash flow was $150 million in the September 2010 quarter. Capital expenditures during the quarter were $360 million, which included $305 million for investments in aircraft, parts and modifications. In the September 2010 quarter, Delta successfully completed $750 million in debt reduction and delevering initiatives. The initiatives included successfully tendering for $300 million of the company's debt, achieving $160 million of debt relief through vendor negotiations, repurchasing $153 million in debt through open market transactions and private purchases, calling $75 million of 9.5% Senior Secured Notes due 2014 and reducing the company's lease expense by purchasing aircraft off lease. Debt maturities in the September 2010 quarter were $295 million. The company issued $225 million of debt for aircraft purchases. At Sep. 30, Delta's adjusted net debt was $15.2 billion, a $400 million reduction from June 30, 2010. "Building a solid financial foundation through debt reduction and cost discipline is a cornerstone of Delta's strategy," said Hank Halter, Delta's chief financial officer. "Through the hard work of the Delta team, we have lowered our adjusted net debt by nearly $2 billion since the end of 2009 and will reduce our non-fuel unit costs by 1% for the year." Company Highlights Delta has a strong commitment to employees, customers and the communities it serves. Key accomplishments in 2010 to date include: * Accruing $275 million in employee profit sharing to date, in recognition of the achievements of all Delta employees toward meeting the company's financial targets; * Unveiling plans for a $1.2 billion enhancement and expansion project at John F. Kennedy International Airport to create a state-of-the-art facility. Delta also introduced improvements to the Sky Club experience at New York-JFK with the introduction of full-service made-to- order meals and premium beverage service and is reinventing the customer dining experience at New York's LaGuardia Airport with the introduction of 13 new food and beverage concepts; * Expanding Delta's network to offer customers the routes they want and need to do business worldwide. Additions to the network include more frequencies between Delta's US gateways and London-Heathrow, new service to Tokyo-Haneda beginning in February 2011 and increased service to Africa where Delta serves more destinations than any other US carrier; * Enhancing Delta's global alliance network with TAROM, Romania's flag carrier, and Vietnam Airlines joining SkyTeam and supporting the decision of China Eastern and China Airlines to join SkyTeam in 2011; * Signing a new codesharing agreement with Hawaiian Airlines that will offer Delta's customers access to connecting flights within the Hawaiian Islands; * Issuing Delta's Corporate Responsibility Report detailing the company's environmental, safety and community service performance over the past two years, including reducing annual CO2 emissions and implementing the airline industry's first comprehensive in-flight recycling program; * Launching a new advertising campaign reflecting Delta's commitment to face the daily challenges of making flying better. The campaign began in New York and is expanding to other cities, including Atlanta, London and Tokyo; * Launching the industry's first social media 'Ticket Window' to permit bookings directly from Delta's Facebook page and other social media sites; and * Promoting awareness of breast cancer research with a new Boeing 767-400 signature "pink plane;" online with a virtual lemonade stand on Facebook and SkyMiles donations to The Breast Cancer Research Foundation when customers download the Delta iPhone application or use the app to check in; and onboard by donating proceeds from pink lemonade and jelly bean sales. Special Items Delta recorded special items totaling a $566 million charge in the September 2010 quarter, including: * $360 million in primarily non-cash loss on extinguishment of debt; * $153 million in costs related to the Comair fleet reduction; and * $53 million in merger-related expenses. Delta recorded special items totaling a $212 million charge in the September 2009 quarter, including: * $83 million in non-cash loss on extinguishment of debt; * $78 million in merger-related expenses; and * $51 million in severance and related costs. December 2010 Quarter Guidance Delta's projections for the December 2010 quarter are: 4Q 2010 Forecast ---------------- Operating margin 6 - 8% Fuel price, including taxes and hedges $2.45 Capital expenditures $300 million Total liquidity at end of period $5.2 billion 4Q 2010 Forecast (compared to 4Q 2009) --------------------- Consolidated unit costs - excluding fuel expense and profit sharing Down 3 - 5% Mainline unit costs - excluding fuel expense and profit sharing Down 1 - 3% System capacity Up 5 - 7% Domestic Up 3 - 5% International Up 10 - 12% Mainline capacity Up 6 - 8% Domestic Up 5 - 7% International Up 10 - 12% Other Matters Included with this press release are Delta's unaudited Consolidated Statements of Operations for the three and nine months ended Sep. 30, 2010 and 2009; a statistical summary for those periods; selected balance sheet data as of Sep. 30, 2010 and Dec. 31, 2009; and a reconciliation of certain non-GAAP financial measures. DELTA AIR LINES, INC. Unaudited Consolidated Statements of Operations Three Months Ended Sept. 30, 2010 Operating Revenue: Passenger: Mainline $6,204,000,000 Regional carriers 1,571,000,000 ------------- Total passenger revenue 7,775,000,000 Cargo 227,000,000 Other, net 948,000,000 ------------- Total operating revenue 8,950,000,000 Operating Expense: Aircraft fuel and related taxes 2,023,000,000 Salaries and related costs 1,669,000,000 Contract carrier arrangements 1,236,000,000 Aircraft maintenance mat./outside repairs 405,000,000 Contracted services 398,000,000 Passenger commissions/other selling expenses 404,000,000 Depreciation and amortization 375,000,000 Landing fees and other rents 331,000,000 Passenger service 190,000,000 Aircraft rent 92,000,000 Profit sharing 185,000,000 Restructuring and merger-related items 206,000,000 Other 433,000,000 ------------- Total operating expense 7,947,000,000 ------------- Operating Income 1,003,000,000 Other (Expense) Income: Interest expense (256,000,000) Amortization of debt discount, net (53,000,000) Interest income 7,000,000 Loss on extinguishment of debt (360,000,000) Miscellaneous, net 25,000,000 ------------- Total other expense, net (637,000,000) ------------- Income (Loss) Before Income Taxes 366,000,000 Income Tax (Provision) Benefit (3,000,000) ------------- Net Income (Loss) $363,000,000 ============= DELTA AIR LINES, INC. Unaudited Selected Balance Sheet Data As of Sept. 30, 2010 Cash and cash equivalents $3,436,000,000 Short-term investments 439,000,000 Restricted cash, cash equivalents & short-term investments (short-term and long-term) 456,000,000 Total assets 43,153,000,000 Total debt and capital leases, including current maturities 15,365,000,000 Total stockholders' equity 715,000,000 About Delta Air Lines Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- provides scheduled air transportation for passengers and cargo throughout the United States, and around the world. The Company's route network is centered on the hub system it operate at airports in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo- Narita. The hub operations include flights, which gather and distribute traffic from markets in the geographic region surrounding the hub to domestic and international cities and to other hubs. The network is supported by a fleet of aircraft, which is varied in terms of size and capabilities. On December 31, 2009, the Company's wholly owned subsidiary Northwest Airlines, Inc., merged with and into Delta. The wholly owned subsidiary of the Company is Northwest Airlines Corporation. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Stable/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DELTA AIR: Seeks Final Decree Closing Chapter 11 Cases ------------------------------------------------------ The Reorganized Delta Air and its units seek the U.S. Bankruptcy Court's entry of: (i) a final decree, pursuant to Section 350(a) of the Bankruptcy Code and Rule 3022 of the Local Bankruptcy Rules for the Southern District of New York, closing the remaining: -- Chapter 11 case of Delta, Case No. 05-17923 (CGM), and -- Chapter 11 case of Comair, Case No. 05-17924 (CGM); (ii) an order (a) deeming any distributions allocable to any Holders of Allowed Claims that remain unclaimed as of March 31, 2011, as "undeliverable distributions" and void ab initio, and (b) authorizing and directing that all Undeliverable Distributions and any residual shares of Delta stock remaining in the Final Reserve after resolution of all disputed claims will revert to Reorganized Delta to be transferred to the Delta Employee and Retiree Care Fund -- a non-profit 501(c)(3) charitable organization -- with each corresponding Allowed Claim being automatically discharged and forever barred. Timothy E. Graulich, Esq., at Davis Polk & Wardwell LLP, in New York, relates that the Reorganized Debtors' Chapter 11 cases were among the largest and most complicated ever filed. "Even in the post-Lehman environment, these cases remain among the largest and most successful restructurings in history," he said. In all, Mr. Graulich explains, more than 9,400 proofs of claim have been filed in these Chapter 11 cases. The sum of the filed proofs of claim and unmatched Schedule entries in these Chapter 11 cases was a staggering $93.1 billion, he notes. At this time, as a result of enormous coordinated efforts, the Reorganized Debtors have successfully resolved all but a small handful of disputed claims, discloses Mr. Graulich. These disputed claims were principally resolved through negotiation and litigation, including the filing of 27 general omnibus claim objections, 12 omnibus aircraft objections and dozens of specific objections. These objections have resulted in numerous hearings, written opinions and appeals. Nevertheless, nearly every single disputed claim has been successfully resolved, he asserts. Since confirmation of the Plan, the Reorganized Debtors have made distributions to more than 43,800 allowed administrative, priority, secured and unsecured claims, including tens of thousands of retiree claims, with a face value of approximately $14.2 billion. It included distributions to Delta creditors in respect of more than $13.2 billion of allowed claims and distributions to Comair creditors in respect of more than $1 billion of allowed claims. At this time, virtually all Allowed Secured, Administrative and Priority Claims have been satisfied in full, notes Mr. Graulich. Under the Plan, 358.8 million shares of Reorganized Delta common stock were allocated to Delta creditors holding Allowed Unsecured Claims, and another 27.2 million shares of Reorganized Delta common stock were allocated to Comair creditors holding Allowed Unsecured Claims. Upon completion of the Reorganized Debtors' October 2010 Distribution and November 2010 Distribution, 324.2 million Delta Shares; 22.7 million Comair Shares; and $8.9 million in cash will have been distributed to resolve Allowed Claims with a face value of approximately $14.6 billion, Mr. Graulich elaborates. He notes that the October 2010 Distribution is anticipated to be effected on or about Oct. 25, and the November 2010 Distribution is anticipated to be effected on or about Nov. 15. Cases: Fully Administered Mr. Graulich notes that the Advisory Committee Note to Rule 3022 directs courts to apply these six factors to determine whether a bankruptcy case has been "fully administered": (1) Whether the order confirming the plan has become final; (2) Whether deposits required by the plan have been distributed; (3) Whether the property proposed by the plan to be transferred has been transferred; (4) Whether the debtor or the successor of the debtor under the plan has assumed the business or the management of the property dealt with by the plan; (5) Whether payments under the plan have commenced; and (6) Whether all motions, contested matters, and adversary proceedings have been finally resolved. The Reorganized Debtors assert that the Remaining Chapter 11 Cases have been fully administered and may be closed as the Cases satisfy each of the Rule 3022 factors: (a) The Confirmation Order is final, having been entered in April 2007. (b) No claims, other than certain remaining claims, remain to be resolved in the Remaining Chapter 11 Cases. (c) The Reorganized Debtors have already distributed and transferred all of the cash, stock, notes and other property contemplated to be disbursed to the Reorganized Debtors' creditors under the Plan, other than the Final Distribution, the Final Reserve and, amounts to be distributed on any administrative or priority claims that remain unresolved, if any. (d) Pursuant to the Plan, the Reorganized Debtors have long since assumed management of their reorganized estates. Similarly, the Reorganized Debtors' boards of directors have directed their affairs since 2007. (e) Payments under the Plan are nearly complete. In addition to the initial distribution that occurred immediately after the Plan became effective, the Reorganized Debtors have already made 15 separate, periodic distributions to their creditors on account of the vast majority of the more than $14.6 billion in Allowed Claims in these Chapter 11 cases. Upon completion of the Current Distributions, there will only be approximately 34.6 million shares remaining in Delta's disputed claims reserve and there are currently 4.5 million shares in Comair's disputed claims reserve. Of the disputed claims reserves, the Reorganized Debtors propose to (i) reserve a sufficient number of shares to resolve outstanding disputed claims against Delta and Comair, and (ii) distribute the remaining shares pro rata to Delta and Comair creditors holding Allowed Unsecured Claims. The Reorganized Debtors aver that the Distributions under the Remaining Chapter 11 Cases are substantially complete. They intend to make the Final Distribution as soon as reasonably practicable. (f) The Reorganized Debtors have resolved virtually all outstanding motions, contested matters and adversary proceedings. "[A]ll of the Reorganized Debtors' other creditors should not be forced to wait until the Remaining Claims are finally resolved in order to receive their final distributions and for the Remaining Chapter 11 Cases to be closed," contends Mr. Graulich. In this light, the Reorganized Debtors propose that the Bankruptcy Court retain jurisdiction over certain open matters pending their resolution. Mr. Graulich tells the Court that the Reorganized Debtors are working industriously to resolve substantially all of the Remaining Claims prior to the hearing on the Final Decree Motion. The Reorganized Debtors also intend to file a motion seeking to estimate for reserve and distribution purposes each of the Remaining Claims that cannot be timely resolved, he reveals. The Reorganized Debtors anticipate that any outstanding Remaining Claims will be de minimis. Taking into account the reserves to be sought in the Estimation Motion, the Reorganized Debtors seek the Court's approval to establish a reserve from the Delta Shares for the Remaining Claims against Delta and another reserve from the Comair Shares for the Remaining Claims against Comair, sufficient to resolve all of the Remaining Claims. These will be referred to as the Delta and Comair Final Reserves. Any stock remaining in the pool of Reorganized Delta stock allocated to the Reorganized Debtors' creditors, other than (i) the Final Reserve for the Remaining Claims, and (ii) the Undeliverable Distributions, will be distributed as soon as reasonably practicable to holders of Allowed Unsecured Claims in a final Distribution. Given the amount of work and the number of calculations involved in computing the pro rata portion of the Final Distribution for each holder of an Allowed Claim, the Reorganized Debtors intend to distribute the Final Distribution in two phases: * No later than December 31, 2010, the Reorganized Debtors will distribute the Final Distribution with respect of Allowed Unsecured Claims in face amounts greater than $10 million. * No later than March 31, 2011, the Reorganized Debtors will distribute the Final Distribution for all other Allowed Unsecured Claims. The Final Distribution will be in full and complete satisfaction of all affected claims. In the event any administrative and priority claims remain unresolved as of the hearing on the Final Decree Motion, the Reorganized Debtors propose to address those claims in the ordinary course of business. Those claims, if allowed, would be payable in cash and would therefore, have no impact upon the Final Reserve, Mr. Graulich explains. Final Report Not Required In accordance with the Post-Confirmation Order and Notice entered on April 26, 2007, unless requested by the Court, the Reorganized Debtors are not required to file a final report with the Court or serve the Final Report on the U.S. Trustee, which Final Report would be otherwise required pursuant to Local Rule 3022-1, notes Mr. Graulich. Undeliverable Distributions Will Revert to Delta Mr. Graulich notes that the Reorganized Debtors have been unsuccessful in contacting certain holders of Allowed Unsecured Claims, and Distributions to these holders have remained undelivered for well over a year past the relevant Distribution Date. At this time, Distributions for 180 Allowed Unsecured Claims with a face amount of $2,892,492, which account for approximately 0.3% of all Allowed Claims, are undeliverable. A list of the Undeliverable Distributions may be accessed for free at: http://ResearchArchives.com/t/s?6cc5 The Reorganized Debtors have allocated 77,200 shares of Reorganized Delta stock -- 63,300 shares for Delta and 13,900 shares for Comair -- for the satisfaction of those Allowed Unsecured Claims. Undeliverable distributions will be returned to Reorganized Delta until the distributions are claimed. All distributions under the Plan that remain unclaimed for one year after the relevant Distribution Date will indefeasibly revert to Reorganized Delta. Upon the reversion, the relevant Allowed Claim will be automatically discharged and forever barred, notwithstanding any federal or state escheat laws to the contrary. The Court will convene a hearing on December 16, 2010, at 11:30 a.m. prevailing Eastern Time, to consider the Reorganized Debtors' request. Parties have until 4:00 p.m. prevailing Eastern Time, on November 23, to file objections. About Delta Air Lines Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- provides scheduled air transportation for passengers and cargo throughout the United States, and around the world. The Company's route network is centered on the hub system it operate at airports in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo- Narita. The hub operations include flights, which gather and distribute traffic from markets in the geographic region surrounding the hub to domestic and international cities and to other hubs. The network is supported by a fleet of aircraft, which is varied in terms of size and capabilities. On December 31, 2009, the Company's wholly owned subsidiary Northwest Airlines, Inc., merged with and into Delta. The wholly owned subsidiary of the Company is Northwest Airlines Corporation. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Stable/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DYNAVAX TECHNOLOGIES: Prices Public Offering of Shares at $1.70 --------------------------------------------------------------- Dynavax Technologies Corporation announced Thursday the pricing of an underwritten public offering of 23,000,000 shares of its common stock at a price to the public of $1.70 per share. The gross proceeds to Dynavax from this offering are expected to be approximately $39.1 million, before deducting underwriting discounts and commissions and other estimated offering expenses payable by Dynavax. Jefferies & Company, Inc., is acting as sole book-running manager for the offering. Wedbush PacGrow Life Sciences and Cowen and Company, LLC, are acting as co-managers for the offering. Dynavax has granted the underwriters a 30-day option to purchase up to an aggregate of 3,450,000 additional shares of common stock to cover over-allotments, if any. The offering is expected to close on or about November 2, 2010, subject to customary closing conditions. Dynavax anticipates using the net proceeds from the offering to fund its development activities for its lead program, HEPLISAVTM, a Phase 3 investigational hepatitis B vaccine, and for other general corporate purposes, including working capital. The securities are being offered by Dynavax pursuant to a shelf registration statement previously filed with the Securities and Exchange Commission, which the SEC declared effective on October 4, 2010. A preliminary prospectus supplement related to the offering has been filed with the SEC. Copies of the final prospectus supplement relating to these securities, when available, may be obtained from Equity Syndicate Prospectus Department, Jefferies & Company, 520 Madison Avenue, 12th Floor, New York, NY, 10022, at 877-547-6340, and at Prospectus_Department@Jefferies.com About Dynavax Technologies Berkeley, Calif.-based Dynavax Technologies Corporation (NASDAQ: DVAX) -- http://www.dynavax.com/-- is a clinical-stage biopharmaceutical company. The Company discovers and develops novel products to prevent and treat infectious diseases. The Company's lead product candidate is HEPLISAV, an investigational adult hepatitis B vaccine designed to enhance protection more rapidly and with fewer doses than current licensed vaccines. The Company's balance sheet as of June 30, 2010, showed $71.7 million in assets, $58.9 million in liabilities, and stockholders' equity of $12.8 million. As reported in the Troubled Company Reporter on March 18, 2010, Ernst & Young LLP, in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has incurred significant operating losses and negative cash flows from operations since its inception. DYNEGY INC: Asks Stockholders to Vote in Favor of Merger -------------------------------------------------------- Dynegy Inc. sent the following letter to its stockholders reiterating the recommendation of the Dynegy Board of Directors that they vote FOR the proposal to adopt the merger agreement with an affiliate of The Blackstone Group L.P. at Dynegy's November 17, 2010 Special Meeting of Stockholders: November 2, 2010 Dear Stockholders: Your Board of Directors believes the Blackstone transaction is in the best interest of all Dynegy stockholders because it provides immediate, certain and fair value for your shares while reducing the considerable downside risk facing Dynegy if the Blackstone transaction is not approved and completed. Your Board recommends that stockholders vote FOR the Blackstone transaction on the enclosed WHITE proxy card today. As we have previously communicated: No transaction other than the Blackstone proposal materialized over Dynegy's two-year evaluation of strategic alternatives; Despite the broad solicitation of potentially interested parties during the 40-day "go-shop" period, no party made a proposal, much less one that was superior to the Blackstone offer; Dynegy's significant leverage and $1.6 billion of forecasted negative free cash flow between 2011 and 2015(1) create a very challenging liquidity position over time; There is significant risk to Dynegy associated with a stand-alone strategy and those risks have increased since the announcement of the Blackstone transaction; and Dynegy's stock price could fall to or below its pre- announcement stock price of $2.78 per share if the Blackstone transaction is not completed. THE ANALYSES OF NUMEROUS INDEPENDENT SELL-SIDE ANALYSTS CONSISTENTLY APPEAR TO SUPPORT THE BLACKSTONE TRANSACTION AS THE BEST ALTERNATIVE AVAILABLE FOR DYNEGY STOCKHOLDERS Numerous independent sell-side financial and credit analysts, who have a deep understanding of the power generation industry and Dynegy's financial condition, have published research reports that consistently appear to support your Board's conclusion that the Blackstone transaction is the best alternative available for Dynegy's stockholders:(2) "We believe the [Blackstone] deal will be consummated at the announced bid price since: 1) no better bid came during go shop period, and no parties made bid despite having contacted 40+ firms; 2) Blackstone is hard pressed to improve takeout price given precedent, and; 3) DYN is substantially more distressed than when deal was announced (had a 60% premium to share price at takeout)." -- Julien Dumoulin-Smith, UBS, October 25, 2010 "Based on our assessment of these public filings, Dynegy's financial profile is expected to be quite fragile, particularly during 2011 and 2012, when the company is projected to generate both negative operating cash flow and negative free cash flow due to weak operating margins and the required funding of their capital investment programs." -- Moody's, October 1, 2010 "With the end of the 40-day period during which DYN was allowed to try to find a better offer than the one it currently has with Blackstone for $4.50 per Dynegy share, we are lowering our 12-month target price by $0.50 to the deal price of $4.50 as we do not expect a higher offer. During the period, DYN contacted some 42 parties and signed confidentiality agreements with 8 in an effort to find a better offer. However, no new proposals were made by any of those parties." -- Standard & Poor's Investment Advisory Services LLC, October 9, 2010 "[Another bidder] looking to replicate the NRG deal with another party (NRG is locked in exclusivity), with the fall in Nat Gas prices and the depressed coal and gas units for sale in the market, those assets are unlikely to fetch the $1.36B NRG is paying for them. All said, there are significant financial hurdles for an interloping bid." -- Stephen Grahling, Jefferies & Co., October 5, 2010 Recent comments from NRG Energy, Inc.'s CEO, David Crane, reinforce the viewpoint of certain sell-side analysts regarding the difficulty in replicating the sale of four natural gas-fired assets proposed to be sold to NRG concurrently with the closing of the Blackstone transaction: "We would re-price the transaction and it would re-price in a southward direction. All power plants are basically priced off the forward gas curve and the forward gas curve has gone down since the deal was announced." -- David Crane, Reuters, October 29, 2010 DYNEGY BELIEVES SENECA'S INTERESTS ARE NOT ALIGNED WITH THOSE OF ALL DYNEGY STOCKHOLDERS In advance of the Special Meeting, Dynegy stockholders should ask themselves the following questions: Are Seneca's interests aligned with those of all other Dynegy stockholders? Dynegy believes they are not. Prior to the announcement of the Blackstone transaction, Seneca owned less than 1% of outstanding Dynegy stock. As recently as the day before the Blackstone transaction was announced, Seneca sold approximately 700,000 shares of Dynegy stock at $2.93. Based on this pre-Blackstone transaction announcement sale, it appears that Seneca very recently viewed $2.93 per share as a fair value for Dynegy. However, since the announcement of the Blackstone transaction Seneca has been a net purchaser of Dynegy stock, predominantly at prices in excess of Blackstone's $4.50 per share offer. In fact, beginning the day the transaction was announced, Seneca has purchased 62.6 million shares at an average weighted cost of $4.66 per share. All told, Seneca currently owns approximately 9% of Dynegy's outstanding shares. Perhaps the real question is: Why has Seneca accumulated such a large position -- after the transaction was announced -- at prices above the offer price? If Seneca truly believes the Blackstone offer is undervalued, why didn't it hold the shares it sold at $2.93 or execute a non- disclosure agreement to receive more information about Dynegy and potentially submit a proposal in excess of Blackstone's offer during the 40-day "go-shop" period? What is Seneca's motivation in attempting to defeat the Blackstone transaction? What is Seneca's true economic interest in Dynegy? Simply put, we believe Seneca is looking to advance its own interests at the expense of all other Dynegy stockholders. We further believe Seneca will seek to create value for itself dependent on what actions and what investments will yield it the greatest return, even if such actions or investments are not consistent with the interests of Dynegy's other equity investors. We know Seneca holds over-the-counter European-style call options, providing the right to purchase 1,986,900 and 904,100 shares of Dynegy common stock, respectively, at an exercise price of $1.00 per share as of January 21, 2011. We do not know what other Dynegy-related securities Seneca might own, including our debt securities and credit default swaps and other complex constructions of hybrid securities. We cannot rule out the possibility that Seneca has structured trades that would create significant additional value for Seneca by capitalizing on and profiting from a failed transaction with Blackstone. In contrast, Dynegy's Board is looking after the best interest of Dynegy and ALL its stockholders. How can Seneca conclude the current offer is unacceptable when they have no specific alternative? Does Seneca have a plan to effectively manage Dynegy on a stand-alone basis? Seneca offers Dynegy stockholders no strategic plan. Seneca's SEC filings -- including the one it made today -- are completely devoid of any alternative by either Seneca or any other party that would deliver immediate value to Dynegy stockholders. Furthermore, Seneca fails to recognize that Dynegy's Board conducted a thorough review of strategic alternatives over the past TWO years to maximize value for its stockholders. In fact, Seneca's strategy appears to be solely dependent on the simplistic hope for a dramatic turnaround in natural gas prices. Dynegy's Board believes it is not in the best interest of Dynegy or its stockholders to predicate a go-forward strategy on the hope that the price of natural gas reverses its current downward trend. Seneca's recommendations to Dynegy stockholders have demonstrated a lack of experience in managing a public company like Dynegy, especially in a difficult economic environment. Dynegy has obligations to many stakeholders and must sustain itself to deliver value to all of its constituencies. Is risking Dynegy's stock price and future on the hope that natural gas prices will turnaround to a level well in excess of current market expectations a viable strategy? Hope is not a strategy and that is all Seneca is offering. Why should Dynegy stockholders vote for the Blackstone transaction? Despite its restructuring efforts, Dynegy continues to face challenges, many of which are beyond its control, including low and declining commodity prices driven by the large quantities of shale gas being developed in North America and continued economic weakness. Together, these two forces create significant risks and operating limitations for Dynegy's business, exacerbating Dynegy's substantial leverage and requiring Dynegy to access capital going forward. If the Blackstone transaction is not approved and subsequently completed, Dynegy will likely breach its debt covenants by the end of the second quarter of 2011; Dynegy expects $1.6 billion of negative free cash flow between 2011 and 2015 and may be forced to restructure its balance sheet using one or a combination of several options, including issuing equity or equity-linked securities, implementing debt for equity swaps or selling assets at depressed prices. As a result, Dynegy's stockholders could lose not only the significant and immediate cash value inherent in Blackstone's premium offer, but could also face potential significant dilution and further loss on their investment as a result of any such subsequent restructuring activities. YOUR VOTE IS IMPORTANT -- PLEASE VOTE FOR THE BLACKSTONE TRANSACTION TODAY We have presented you with the facts, now it is time for ALL Dynegy stockholders to act. Your vote is extremely important, no matter how many or how few shares you own. Please take a moment to vote FOR the proposal to adopt the merger agreement today -- by telephone, by Internet or by signing, dating and returning the enclosed WHITE proxy card in the postage-paid envelope provided. Please discard any gold proxy cards you receive from Seneca Capital and vote the WHITE proxy card today. For more information, please see Dynegy's definitive proxy statement, which was filed with the SEC on October 4, 2010; an Investor Presentation that was filed with the SEC on October 5, 2010 and updates to that Investor Presentation that were filed with the SEC on October 19, 2010, and October 27, 2010, respectively; and letters to stockholders that were filed with the SEC and issued as press releases on October 6, 2010, October 19, 2010, and October 26, 2010, respectively. Thank you for your support. Sincerely, /s/ Bruce A. Williamson Bruce A. Williamson Chairman, President and CEO About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE:DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. Dynegy Inc. and Dynegy Holdings each has a 'B-' issuer default rating from Fitch. In October 2010, Moody's Investors Service lowered the ratings of Dynegy Holdings, including its Corporate Family Rating, to Caa1 from B3 along with the ratings of various affiliates or parent company Dynegy Inc. The rating outlook for DHI and Dynegy remains negative. The rating action follows the expiration of the 40-day "go shop" period, increasing the probability that Dynegy will be acquired by an affiliate of The Blackstone Group L.P. in a transaction valued at approximately $4.7 billion, including the assumption of existing debt. Moody's said Dynegy's financial profile is expected to be quite fragile, particularly during 2011 and 2012, when the company is projected to generate both negative operating cash flow and negative free cash flow due to weak operating margins and the required funding of their capital investment programs. To the extent that the transactions with Blackstone and NRG are not completed, Moody's said downward rating pressure at DHI and Dynegy will continue to exist given the weak financial prospects for the company over the next few years coupled with the liquidity concerns. EMIVEST AEROSPACE: RB Capital DIP Financing Approved on Interim --------------------------------------------------------------- Emivest Aerospace Corporation sought and obtained interim authorization from the Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware to obtain postpetition secured financing from Counsel RB Capital, LLC, as administrative agent, and EAI Capital, LLC, and to use cash collateral. Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP, explained that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. A copy of the DIP financing agreement is available for free at: http://bankrupt.com/misc/EMIVEST_AEROSPACE_dipfinancingpact.pdf http://bankrupt.com/misc/EMIVEST_AEROSPACE_dipfinancingpact2.pdf The DIP lenders have committed to provide up to $4 million. An initial advance in a principal or face amount of $1 million will be funded upon entry of the interim court order. A second advance of $2 million will be funded upon entry of the final court order. A final advance of $1 million will be funded on the date that is 30 days after the date of entry of the final court order. The Debtor will grant the Agent superpriority administrative claim status and senior liens in respect of all advances and obligations, subject and subordinate only to the carve-out and permitted liens. The Debtor will grant the Agent valid and perfected priming first priority security interests and liens. As additional security for the payment and performance of the obligations, the Debtor will assign to the Agent any and all monies due or to become due under, and all other rights of the Debtor with respect to, any and all policies of insurance now or hereafter covering the collateral or any evidence thereof or any business records or valuable papers pertaining thereto. The DIP facility will mature on February 10, 2011. The principal amount of the advance will bear interest at the rate of $40,000 per month or at a lesser amount prorated for the number of days elapsed in the months in which the initial advance is made and the month during which the termination date occurs and during which any advance is outstanding, computed on the basis of actual number of calendar days in which any advance is outstanding. The Debtor will be paying a $250,000 commitment fee, and a $250,000 exit fee, both to be paid on the termination date. Provided that no event of default will have occurred, the DIP lenders will agree to waive the commitment fee, all accrued and unpaid interest on all advances, and the exit fee in exchange for a payment on the termination date of $700,000. Upon receipt by the Debtor of the net cash proceeds arising from any sale transaction, the Debtor will pay or cause to be paid to the DIP Agent no later than one business day after the receipt, an amount equal to 100% of the net cash proceeds of any of the sale transaction. Upon receipt by the Debtor of proceeds arising from any casualty or condemnation yielding gross cash proceeds, the Debtor will pay the DIP Agent no later than one business day after the receipt an amount equal to 100% of the net cash proceeds thereof. The DIP Facility will be secured by a continuing priming first priority lien and security interest, subject to the carve-out and permitted liens. The DIP lien is subject to a carve-out for U.S. Trustee and Clerk of Court fees; up to $450,000 in fees payable to professional employed in the Debtors' case; and fees of the committee in pursuing actions challenging the DIP Lenders' lien. Subject to the carve-out and permitted liens, the indebtedness of the Debtor under the DIP credit agreement will constitute a superpiority administrative claim having priority over any and all administrative expenses of and unsecured claims against the Debtor. Within two business days after the end of each month, the Debtor will deliver to the DIP Agent a reconciliation of the actual disbursements of the Debtor and existing advances under the DIP credit agreement for the month in the budgeted line item amounts set forth in the budget for the month. A copy of the budget is available for free at: http://bankrupt.com/misc/EMIVEST_AEROSPACE_budget.pdf Mr. Dehney said that the Debtor will also use the Cash Collateral to provide additional liquidity. In exchange for using cash collateral, the Debtor will grant the prepetition lenders adequate protection of interest in the prepetition collateral, in an amount equal to the aggregate diminution in value of its interests in the prepetition collateral. Wells Fargo Securities, LLC, fka Wachovia Capital Markets, LLC, and the Texas State Comptroller of Public Accounts are also entitled to adequate protection of their interests in the collateral securing their respective lien. The Debtor will pay Wells Fargo $250,000, out of the proceeds received by the Debtor from the initial advance under the DIP Facility and within five business days of the Debtor's receipt of the initial advance, in partial satisfaction of Wells Fargo's claim. The Debtor will also grant Wells Fargo a superpriority administrative expense claim and a valid, perfected security interest in and junior lien upon all the collateral. The Debtor will pay Texas Comptroller $135,000, out of the proceeds received by the Debtor from the second advance under the DIP Facility and within five business days of the Debtor's receipt of the second advance, in partial satisfaction of Texas Comptroller's claim. The Debtor will pay Texas Comptroller $65,000, out of the proceeds received by the Debtor from the third advance under the DIP Facility and within five business days of the Debtor's receipt of the third advance, in partial satisfaction of Texas Comptroller's claim. The Debtor will also grant Texas Comptroller a superpriority administrative expense claim and a valid, perfected security interest in and junior lien upon all the collateral. The Debtor will grant the prepetition secured party a valid, perfected replacement security interest in and junior lien upon all the collateral, and a superpriority administrative expense claim. The Court has set a final hearing for November 12, 2010, at 10:30 a.m. on the Debtor's request to obtain DIP financing and use cash collateral. About Emivest Aerospace Emivest Aerospace Corporation -- http://www.sj30jet.com/-- is a U.S.-based aircraft manufacturing company and a subsidiary of Emirates Investment & Development PSC. Emivest Aerospace Corporation produces the SJ30 light jet. Emivest Aerospace Corporation filed for Chapter 11 protection on Oct. 20, 2010 (Bankr. D. Del. Case No. 10-13391). Emivest estimated assets and debts between $50 million and $100 million. Daniel B. Butz, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Delaware, serves as counsel to the Debtor. ENRON CORP: ECRC Files 24th Post-Confirmation Report ---------------------------------------------------- Enron Creditors Recovery Corp., formerly Enron Corp., and its reorganized debtor affiliates delivered to the U.S. Bankruptcy Court for the Southern District of New York, on October 15, 2010, their Twenty-fourth Post-Confirmation Status Report. A. Distributions John S. Delnero, Esq., at K&L Gates LLP, in Chicago, Illinois, relates that as of October 15, 2010, approximately $21,686,000,000 in Cash, PGE Common Stock and PGE Common Stock equivalents (in the form of cash) have been distributed to holders of Allowed Claims, including $267,000,000 of interest, capital gains and dividends. All Disputed Claims have been resolved and all reserves previously held in the Disputed Claims Reserve, including interest, dividends and gains have been released. As of October 15, 2010, the General Unsecured Creditors of Enron have received 52.4% return on allowed claim amounts compared to original estimates in the Disclosure Statement of 17.4% and the Creditors of Enron North America Corp have received 52.0% compared to original estimates in the Disclosure Statement of 20.1%. The combined rate of return for ENA Creditors who also hold an Enron Guaranty claim is 94.1%, excluding gains, interest and dividends. There are a limited number of pending litigation and collection matters, which may total approximately $150 million in value, that continue to affect the timing of the closure of the Enron bankruptcy case. The $150 million of value yet to be collected relates primarily to the Reorganized Debtors' share of the proceeds of litigation in which the plaintiff -- who is obligated to share recoveries with the Reorganized Debtors -- received summary judgment in the United States District Court for the District of New York and which has been pending on appeal to the Second Circuit Court of Appeals, referred to as the "Bammel Litigation." In addition, the Reorganized Debtors are currently litigating on appeal to the United States District Court the appeal of the denial by the Bankruptcy Court of a motion filed by National City Bank which would require the payment of certain additional monies in the approximate amount of $8.6 million to creditors holding the Allowed ETS Debenture Claim under an agreement which NCB purports to provide most favored nations status in these particular circumstances which the Reorganized Debtors have opposed. The Plan Administrator will make a distribution on or about November 1, 2010, of its currently available funds in the approximate amount of $40 million. Until such time as the Plan Administrator is successful in obtaining additional recoveries related to the litigation and collection efforts, there are no additional funds available for further distribution. B. Claims Resolution Process More than 25,000 proofs of claim were filed against the Debtors. The Reorganized Debtors and, prior to the Effective Date, the Debtors, have worked diligently to review, reconcile, and resolve these claims. In the third quarter of 2008, all Disputed Claims were resolved. Of the more than 25,000 proofs of claim filed, approximately 5,653 have been ordered allowed and approximately 2,333 have been allowed as filed. The remaining filed claims have been expunged, withdrawn, subordinated, or otherwise resolved. C. Settlements and Recoveries The Reorganized Debtors collected approximately $2,059,000 since the Twenty-Third Post-Confirmation Status Report. These amounts were primarily attributable to settlements and the return of other deposits belonging to the Reorganized Debtors. D. Other Activities The Reorganized Debtors continue to oversee additional various Enron activities including: a. Document Administration and Disposal. The Reorganized Debtors have completed their document destruction efforts in accordance with numerous orders entered by the Bankruptcy Court and an order entered by the District Court for the Southern District of Texas. As of Jan 1, 2010, all of the remaining 43,000 boxes eligible for destruction and all electronic storage devices have been destroyed. Approximately 2,600 boxes have been sent to long-term storage in accordance with regulatory requirements, and the Reorganized Debtors have created electronic tape media to store the Litigation Document Library. b. Dissolution of Corporate Entities. There are three remaining entities, of which one is a Debtor and two are Post-Final Distribution Trusts. In conjunction with the dissolution of the remaining corporate entities, Enron Dissolution Corp., a Delaware corporation, was formed solely for the purposes of winding up Enron and Enron Net Works, LLC. Enron and Enron Net Works, LLC, were merged with and into Enron Dissolution Corp. effective on December 18, 2009. Enron Dissolution Corp. was thereafter dissolved effective on December 19, 2009. c. Tax Return Compliance. For 2009, all returns have been filed. d. Resolution of Outstanding Litigation. Twenty cases remain pending. e. The Reorganized Debtors continue to be sponsors of pre- petition benefit plans which are entitled to receive distributions from the settlement of certain class actions securities cases, Tittle, et al. v. Enron Corporation, et al. and Newby, et al. v. Enron Corporation, et al., related to the Enron estate. The Reorganized Debtors are working to transition the responsibility for the administration of the benefit plans and the associated distribution process to independent third parties to allow for the closure at the appropriate time of the Enron Case. The timing of the distribution of class action settlement monies to the benefit plans is uncertain and the Reorganized Debtors lack control over that distribution to those plans. Moreover, the Reorganized Debtors continue to perform the necessary accounting, control and reporting work required to effect closure of the Case promptly. Two remaining headcount and engaged professional firms (a) support litigation, (b) handle accounting, tax, cash management and reporting for the three remaining entities, (c) calculate and control creditor distributions, (d) perform claims management, (e) complete disposition of remaining litigation (f) oversee wind- up of employee matters and benefit plans, and (g) oversee IT and corporate services providers and non-litigation matters. About Enron Corp. Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033) following controversy over accounting procedures that caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP, for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors won confirmation of their Plan in July 2004, and the Plan was declared effective on November 17, 2004. After approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre- bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. ENRON CORP: Fraud Claims v. J. Brown Dismissed by District Judge ---------------------------------------------------------------- U.S. District Judge Ewing Werlein Jr. of the U.S. District Court for the Southern District of Texas dismissed one charge of conspiracy to commit wire fraud and two charges of wire fraud against James A. Brown, a former employee of Merrill Lynch & Co. Inc. Mr. Brown and two other Merrill Lynch employees, Robert S. Furst and Daniel Bayly, were convicted of conspiracy and wire fraud, accused of helping push through Enron Corp.'s sham sale to Merrill Lynch of three power barges moored off the Nigerian coast in 1999, the Associated Press related. According to the report, the deal was struck to make the earnings of Enron's energy division appear larger. Mr. Brown could still return to prison on two remaining convictions that were not overturned, the report added. "The Browns are beginning to get a sense that the worst is over and their family can get out from under the cloud they have been living under for seven years, a cloud of persecution," the Associated Press quoted Sidney Powell, Esq., Mr. Brown's attorney, as saying. About Enron Corp. Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033) following controversy over accounting procedures that caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors won confirmation of their Plan in July 2004, and the Plan was declared effective on November 17, 2004. After approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre- bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. ENRON CORP: Prosecutor Wants Loopholes on Skilling Ruling Fixed --------------------------------------------------------------- A top Department of Justice prosecutor urged Congress to close legal loopholes left by a decision of the Supreme Court vacating Jeffrey Skilling's conviction in failing to provide honest services to shareholders, Houston Chronicle reported. The former Chief Executive Officer of Enron Corp. was convicted in 2006 on 19 counts of fraud, conspiracy and insider trading, and was sentenced to 24 years in prison. According to the report, the ruling has had immediate repercussions for other defendants convicted under the same law. Lanny Breur, assistant attorney general in charge of the Justice Department's criminal division, told the Senate that the Court's ruling on the Skilling case had significantly eroded the government's ability to prosecute fraud and corruption cases, according to the Houston Chronicle. Jeffrey Skilling Retrial A hearing was scheduled November 1, 2010, to consider former Enron Corp. Chief Executive Officer Jeffrey Skilling's bid for a new trial before a federal appeals court in Houston, Bloomberg News reported. "We are very pleased to have an opportunity to argue Jeff's case and hopeful that his long nightmare is coming to an end," Daniel Petrocelli, Esq., Mr. Skilling's lead attorney, was quoted by Bloomberg as saying. According to Mr. Petrocelli, all of Mr. Skilling's verdicts were tainted by an invalid legal theory and should be retried without prosecutors' reliance on so-called honest services theft. The U.S. Supreme Court previously questioned whether Mr. Skilling was properly convicted on 19 counts for leading a conspiracy that caused the collapse of Enron. The high court ordered a review of Mr. Skilling's case by the U.S. Court of Appeals in New Orleans, according to the report. About Enron Corp. Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033) following controversy over accounting procedures that caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors won confirmation of their Plan in July 2004, and the Plan was declared effective on November 17, 2004. After approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre- bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. FRAC TECH: Moody's Assigns 'B1' Corporate Family Rating ------------------------------------------------------- Moody's Investors Service assigned a B1 Corporate Family Rating to Frac Tech Services, LLC, and assigned a B2 rating to the company's proposed offering of $550 million senior notes due 2018. The proceeds of the offering will be used to repay existing indebtedness, make a $200 million distribution to shareholders and fund planned capital expenditures to expand its hydraulic fracturing fleet. The outlook is stable. Ratings Rationale "Frac Tech's high quality fleet of fracturing equipment and substantial market position in the U.S. underpins its B1 Corporate Family Rating," commented Pete Speer, Moody's Vice-President. "Although the company has strong earnings momentum, the rating is restrained by the cyclical nature of demand for its services and the strong competition in its service line." Frac Tech was formed in 2000 and has grown rapidly since 2005 into one of the largest hydraulic fracturing services providers in North America as measured by horsepower. The company operates primarily in the Haynesville, Marcellus and Eagle Ford shale plays and the Permian Basin. Frac Tech's quarterly earnings have grown rapidly in 2010 from 2009 cyclical lows due to increased drilling activity and the secular trends of more horizontal wells and increased fracturing stages per well. The company also benefits from manufacturing its own equipment and ownership of sand mines to provide its own proppant supply. The demand for pressure pumping services has quickly rebounded to exceed existing equipment supply, providing Frac Tech and its peers with pricing power that significantly exceeds other U.S. onshore oilfield service lines. The company is pursuing multi- year contracts with exploration and production companies to provide more revenue and investment return visibility while ramping up capital expenditures to build more equipment. This increasing contract cover and the trend in oil and natural gas liquid directed shale drilling provides some protection against potential decreases in natural gas directed drilling activity in 2011 due to low natural gas prices. However, the B1 CFR also incorporates the inherent cyclicality of oilfield services demand, the significant amount of long-term debt being added to the company's capital structure, and its concentration in one service line. Frac Tech competes with Schlumberger, Halliburton and Baker Hughes, much larger companies with deeper financial resources and very diverse product and service lines. The company also competes with many similarly sized diversified oilfield services companies and other pressure pumping focused competitors. The outlook could be changed to positive or the ratings upgraded if Frac Tech reduces its debt levels or significantly increases its asset base and service line diversity. If the company substantially increases its leverage due to debt funded acquisitions or additional shareholder distributions, the rating outlook could be changed to negative or the ratings downgraded. The rating incorporates expectations of significant earnings volatility over the medium to longer term, but if earnings were to decline to levels that resulted in Debt/EBITDA exceeding 4x, that could pressure the ratings. The B2 senior unsecured notes rating reflects both the overall probability of default of Frac Tech, to which Moody's assigns a PDR of B1, and a loss given default of LGD 4 (65%). The company expects to finalize a $200 million senior secured revolving credit facility that matures in 2014. The size of the revolver's potential priority claim relative to the senior unsecured notes results in the senior notes ratings being rated one notch beneath the B1 CFR under Moody's Loss Given Default Methodology. Frac Tech Services, LLC, is a privately held oilfield services company headquartered in Cisco, Texas. GARLOCK SEALING: Asbestos Trust Fights Move for Victims' Info ------------------------------------------------------------- Trusts born out of several asbestos companies' bankruptcy cases are fighting back against what they say is an effort by a host of insurance companies, claims processing facilities and asbestos- tainted businesses -- including Garlock Sealing Technologies LLC and Specialty Products Holding Corp. -- to dig up mass amounts of information about alleged asbestos victims and the money they've received over the years, Dow Jones' DBR Small Cap reports. About Garlock Sealing Headquartered in Palmyra, NY, Garlock Sealing Technologies LLC is an EnPro Industries, Inc. company (NYSE: NPO). For more than a century, Garlock has been helping customers efficiently seal the toughest process fluids in the most demanding applications. On June 5, 2010, Garlock filed a voluntary Chapter 11 petition (Bankr. W.D. N.C. Case No. 10-31607) in Charlotte, North Carolina, to establish a trust to resolve all current and future asbestos claims against Garlock under Section 524(g) of the U.S. Bankruptcy Code. The Debtor estimated $500 million to $1 billion in assets and up to $500 million in debts as of the Petition Date. Affiliates The Anchor Packing Company and Garrison Litigation Management Group, Ltd., also filed for bankruptcy. The filing covers only Garlock operations in Palmyra, New York and Houston, Texas. Garlock Rubber Technologies, Garlock Helicoflex, Pikotek, Technetics, Garlock Europe and Garlock operations in Canada, Mexico or Australia are not affected by the filing, nor is EnPro Industries or any other EnPro operating subsidiary. Albert F. Durham, Esq., at Rayburn Cooper & Durham, P.A., represents the Debtor in its Chapter 11 effort. Garland S. Cassada, Esq., at Robinson Bradshaw & Hinson, serves as counsel for Asbestos matters. The Official Committee of Asbestos Personal Injury Claimants in the Chapter 11 cases is represented by Travis W. Moon, Esq., at HAMILTON MOON STEPHENS STEELE & MARTIN, PLLC, in Charlotte, NC, Elihu Inselbuch, Esq., at CAPLIN & DRYSDALE, CHARTERED, in New York, and Trevor W. Swett III, Esq., Leslie M. Kelleher, Esq., and Jeanna Rickards Koski, Esq., in Washington, D.C. 20005. Joseph W. Grier, III, the Court-appointed legal representative for future asbestos claimants, has retained A. Cotten Wright, Esq., at Grier Furr & Crisp, PA, and Richard H. Wyron, Esq., and Jonathan P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, as his co- counsel. About 124,000 asbestos claims are pending against Garlock in state and federal courts across the country. The Company says majority of pending asbestos actions against it is stale and dormant -- almost 110,000 or 88% were filed more than four years ago and more than 44,000 or 35% were filed more than 10 years ago. A schedule of the pending asbestos actions is available for free at: http://bankrupt.com/misc/Garlock_PendingAsbestosActions.pdf GAS CITY: Asks Court to Extend Filing of Schedules by 45 Days ------------------------------------------------------------- Gas City, Ltd., et al., ask the U.S. Bankruptcy Court for the Northern District of Illinois to extend until 45 days from the Petition Date the deadline for the filing of lists of creditors and equity security holders, schedules of assets and liabilities, current income and expenses and executory contracts and unexpired leases, and statements of financial affairs. Due to the complexity and diversity of their operations and the numerous critical operational matters that the Debtors' accounting and legal personnel must address in the early days of the Debtors' Chapter 11 cases, the Debtors anticipate that they will be unable to complete their Schedules and Statements in the time required under Bankruptcy Rule 1007(c). The Debtors believe that they have more than 1,000 creditors, which requires the maintenance of voluminous books and records and complex accounting systems to ensure that their operations run efficiently and cost-effectively. Completing the Schedules and Statements will require the collection, review, and assembly of information from multiple sources. Frankfort, Illinois-based Gas City Ltd. -- http://www.gascity.net/ -- is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City filed for Chapter 11 bankruptcy protection on October 26, 2010 (Bankr. N.D. Ill. Case No. 10-47879), estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, William J. McEnery Revocable Trust, filed a separate Chapter 11 petition. Paul V Possinger, Esq., at Proskauer Rose LLP, and Daniel A Zazove, Esq., at Perkins Coie LLP, assist the Debtors in their restructuring effort. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. GAS CITY: Section 341(a) Meeting Scheduled for December 1 --------------------------------------------------------- The U.S. Trustee for Region 11 will convene a meeting of Gas City, Ltd.'s creditors on December 1, 2010, at 1:30 p.m. The meeting will be held at 219 South Dearborn, Office of the U.S. Trustee, 8th Floor, Room 802, Chicago, IL 60604. This is the first meeting of creditors required under Section 341(a) of the U.S. Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Frankfort, Illinois-based Gas City Ltd. -- http://www.gascity.net/ -- is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City filed for Chapter 11 bankruptcy protection on October 26, 2010 (Bankr. N.D. Ill. Case No. 10-47879), estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, William J. McEnery Revocable Trust, filed a separate Chapter 11 petition. Paul V Possinger, Esq., at Proskauer Rose LLP, and Daniel A Zazove, Esq., at Perkins Coie LLP, assist the Debtors in their restructuring effort. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. GAS CITY: Lenders Object to Proposal to Get US$2.2MM Financing -------------------------------------------------------------- Prepetition lenders are objecting to Gas City Ltd. and its owner's efforts to obtain a $2.2 million letter of credit from Bank of America Corp. The lenders, Integra Bank and Old Second Bancorp Inc., filed objections to the proposed financing with the court overseeing the bankruptcy proceedings of Gas City and its owner, the William J. McEnery Revocable Trust, Dow Jones' DBR Small Cap reports. According to the report, Integra and Old Second took issue with the prospect of Bank of America getting liens on all of Gas City and the trust's assets in exchange for providing the bankruptcy financing -- especially since the liens would be on assets that serve as collateral for financing that Integra and Old Second had provided before Gas City and its owner entered bankruptcy. "This relief, if granted, would improperly impair Integra and its rights on account of" financing Integra provided Gas City and the trust, Integra said in court documents, the report discloses. About Gas City Gas City Ltd. is an independent chain of fueling stations with Frankfort, Illinois-based Gas City Ltd. -- http://www.gascity.net/ -- is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City filed for Chapter 11 bankruptcy protection on October 26, 2010 (Bankr. N.D. Ill. Case No. 10-47879), estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, William J. McEnery Revocable Trust, filed a separate Chapter 11 petition. Paul V Possinger, Esq., at Proskauer Rose LLP, and Daniel A Zazove, Esq., at Perkins Coie LLP, assist the Debtors in their restructuring effort. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. GAS CITY: Taps Proskauer Rose as Bankruptcy Counsel --------------------------------------------------- Gas City, Ltd., et al., ask for authorization from the U.S. Bankruptcy Court for the Northern District of Illinois to employ Proskauer Rose LLP as bankruptcy counsel, nunc pro tunc to the Petition Date. Proskauer Rose will, among other things: a. represent the Debtor in proceedings and hearings in the U.S. District and Bankruptcy Courts for the Northern District of Illinois; b. prepare on behalf of the Debtor any necessary motions, applications, orders and other legal papers; c. provide assistance, advice and representation concerning the confirmation of any proposed plan(s) and solicitation of any acceptances or responding to rejections of the plan(s); and d. provide assistance, advice and representation concerning any investigation of the assets, liabilities and financial condition of the Debtor that may be required under local, state or federal law. Proskauer Rose will be paid based on the hourly rates of its personnel: Partner $450-$1,025 Senior Counsel $395-$850 Associate $195-$675 Paraprofessionals $70-$275 Paul V. Possinger, Esq., a member at Proskauer Rose, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. About Gas City Gas City Ltd. is an independent chain of fueling stations with Frankfort, Illinois-based Gas City Ltd. -- http://www.gascity.net/ -- is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City filed for Chapter 11 bankruptcy protection on October 26, 2010 (Bankr. N.D. Ill. Case No. 10-47879), estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, William J. McEnery Revocable Trust, filed a separate Chapter 11 petition. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. GLOBAL AUTOCARE: S&P Gives Negative Outlook, Affirms 'B' Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on Oakland, Ca.-based Global AutoCare to negative from stable. At the same time, S&P affirmed its ratings on Global AutoCare, including the 'B' corporate credit rating. Standard & Poor's affirmed its issue-level and recovery ratings on Global Auto Care's proposed credit facilities and notes. The issue rating on the $350 million senior secured credit facilities is 'B+' (one notch higher than the corporate credit rating) and the recovery rating remains '2', indicating S&P's expectation of substantial (70% to 90%) recovery in the event of a payment default. The issue rating on the proposed $275 million (increased from $250 million) unsecured notes remains 'CCC+', two notches lower than the corporate credit rating. The recovery rating is '6', indicating S&P's expectation that lenders will receive negligible (0% to 10%) recovery in the event of a payment default. "The outlook revision reflects S&P's view that Global AutoCare is pursuing a more aggressive financial policy than originally expected," said Standard & Poor's credit analyst Susan Ding. S&P estimates that the company's credit measures, pro forma for the additional $25 million debt, will be weaker than S&P's original expectation, with FFO/total debt at about 4%, EBITDA interest coverage of about 2x, and total debt to EBITDA in the 6x range. S&P considers these metrics to be weak for the 'B' rating category. The ratings on Global AutoCare reflect what S&P considers to be a highly leveraged financial profile and vulnerable business profile. S&P's business risk assessment incorporates the company's narrow business focus, vulnerability to commodity price volatility and the economy, and its lack of track record as a stand-alone company. There is also some concentration risk, as one customer accounted for about 30% of sales. Somewhat offsetting these factors are the company's well recognized brands, primarily ArmorAll and STP, Oomph!, Son of a Gun, Tuff Stuff, and Car Buddy. The auto care business was part of Clorox Co. and, upon completion of the acquisition, will operate as an independent entity. Although the lack of a track record as a stand-alone company is a key rating factor, the new CEO has extensive industry experience, and other key senior management members have been with the business for numerous years. S&P views the company's financial policy as aggressive because of the mostly debt-financed acquisition, resulting in a highly leveraged capital structure. The outlook is negative. S&P expects Global AutoCare to maintain credit protection measures close to pro forma levels after the proposed transaction and for covenant cushions to exceed 20%. S&P would consider a downgrade if the company's operating performance deteriorates because of the weak economy, resulting in declining EBITDA and a narrowing of the covenant cushion to close to 10%. On the other hand, S&P would consider an outlook revision to stable if the company reduces and sustains leverage of less than 5.5x. GYMBOREE CORP: S&P Assigns 'B+' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'B+' corporate credit rating to San Francisco-based The Gymboree Corp. The outlook is stable. At the same time, S&P assigned its preliminary 'BB-' bank loan rating and preliminary '2' recovery rating to Gymboree's proposed $720 million term loan. The company intends to use the proceeds from the term loan, along with $500 million senior unsecured notes and about $524 million equity contribution, to fund acquisition of the company by Bain Capital LLC. To assure the company has committed funds to close on this transaction, it has arranged for a $520 million increasing-rate unsecured bridge loan maturing in one year. If not converted into exchange notes before its maturity, the loan will be automatically converted into a senior unsecured term loan. "The ratings reflect what S&P considers Gymboree's weak business profile," said Standard & Poor's credit analyst Mariola Borysiak, "based on S&P's expectation that its expansion of the more value- oriented Crazy 8 concept will increase risk, and that cost pressures from higher cotton prices could affect margins." The weak business profile also reflects its presence in the highly competitive and fragmented children's apparel industry, partly offset by its recognized brand, the quality of its products, and good revenue diversity. The highly leveraged financial risk profile reflects the company's hefty debt levels and thin cash flow protection measures following the acquisition by Bain Capital. HARRISBURG, PA: Misses Nov. 1 Debt Payment; to Skip December Dues ----------------------------------------------------------------- Romy Varghese, writing for Dow Jones Newswires, reported that Harrisburg again was to miss a payment on debt tied to its incinerator project, and bond insurer Assured Guaranty Ltd. would cover the $1.2 million payment on Nov. 1, officials from the city and insurer said. According to Dow Jones, Chuck Ardo, spokesman for Mayor Linda Thompson, said Harrisburg's financial condition precludes it from making the $1.2 million payment on the Series A of 2002. Dow Jones noted that Harrisburg this year has missed $10.5 million in debt payments related to the incinerator. Dauphin County, which guarantees the bulk of the $288 million debt after the city, and Assured Guaranty have covered the obligations when the city has missed them. The two are suing Harrisburg to recoup the payments. Dow Jones also said a $35 million payment that is guaranteed by the county and city is due next month, as is $7 million in payments from several 2003 bond series. Harrisburg officials have said they won't be making those payments as well. Dow Jones said Mayor Thompson, Dauphin County Commissioner Jeff Haste and others met Friday to discuss the looming debt payments. Dow Jones reported that Mr. Ardo said no decisions were made at the meeting. As reported by the Troubled Company Reporter on November 1, 2010, Dow Jones' DBR Small Cap said last week Harrisburg's city council may make a decision on hiring bankruptcy attorneys within a couple of weeks, according to councilman Brad Koplinski. According to the report, several council members interviewed five firms -- Fox Rothschild of Philadelphia, Cunningham and Chernicoff of Harrisburg, Van Eck & Van Eck of Harrisburg, Dilworth Paxson of Philadelphia, and Cravath, Swaine & Moore of New York. "It was an important step to making sure all our options are fully considered," DBR Small Cap quoted Mr. Koplinski as saying. The council can pick "one or a mix of firms," Mr. Koplinski added. The DBR Small Cap report noted that the proposed rates range from $200 an hour to $975 an hour among the five firms, said Mr. Koplinski, who added council members want to negotiate a lower fee. Harrisburg has already applied for Pennsylvania's fiscal oversight program for distressed municipalities, known as Act 47. About Harrisburg, PA The city of Harrisburg is coping with debt related to a failed revamp of an incinerator. The outstanding principal on the Incinerator debt is $288 million. Total principal and interest on this debt would amount to approximately $458 million. Debt service payments on the total incinerator debt are $20 million per year. Of this total, Dauphin County, Pennsylvania, is responsible for roughly $10 million and Harrisburg is responsible for the other $10 million. The city is guarantor on 100% of the $288 million Incinerator debt. The City Council of Harrisburg, Pennsylvania, voted 5-2 on September 28 to seek professional advice on bankruptcy or state oversight. Harrisburg needed state aid to avoid default on $3.3 million of bond payments this month. The city has missed about $8 million in debt-service payments this year on bonds issued in connection with a trash-to-energy incinerator. The city owes another $40 million by the end of the year, and was sued by its home county Dauphin County; bond insurer Assured Guaranty Municipal Corp., a unit of Assured Guaranty Ltd.; and bond trustees TD Bank and M&T Bank Corp. over $19 million in skipped bond payments. HELIX BIOPHARMA: Posts C$14.5 Million Net Loss in Fiscal 2010 ------------------------------------------------------------- Helix BioPharma Corp. recorded a net loss of C$14,477,000 for the year ended July 31, 2010. This represents an increase of C$367,000 when compared to fiscal 2009. Total revenues in fiscal 2010 were C$4,434,000 and represent an increase of C$593,000 or 15.4% when compared to total revenues in fiscal 2009 of C$3,841,000. Product revenue contributed to the increase in revenue in fiscal 2010 when compared to fiscal 2009 and was offset slightly by a decrease in license fees and royalties. Product revenue in fiscal 2010 totaled C$3,925,000 and represents an increase of C$681,000 or 21.0% when compared to product revenue in fiscal 2009 of C$3,244,000. Except for Normacol(R), product revenues were higher across all products, with the majority of the increase reflected in the combined product sales of Orthovisc(R) and Monovisc(TM). The Company commenced the distribution of Monovisc(TM) in the 2010 fiscal year. License fees and royalties in fiscal 2010 totaled C$509,000 and represent a decrease of C$88,000 or 14.7% when compared to fiscal 2009. The decrease reflects the fiscal 2009 final payment from Lumera Corporation of USC$75,000 when it provided the Company with notice of termination of a sub-license agreement. Subsequent to the Company's fiscal 2010 year-end, on August 6, 2010, the Company completed a private placement issuing 4,530,000 units at C$2.43 per unit, for gross proceeds of C$11,007,900. Each unit consists of one common share and one common share purchase warrant with each common share purchase warrant entitling the holder to purchase, subject to adjustment, one common share at a price of C$3.40 until August 5, 2013. "The Company's ability to continue as a going concern is dependent on obtaining additional investment capital and the achievement of profitable operations. There can be no assurance that the Company will be successful in increasing revenue or raising additional investment capital to generate sufficient cash flows to continue as a going concern. While the Company estimates it has sufficient capital and liquidity to finance current operations through at least the next twelve months, the Company's long-term liquidity depends on its ability to access the capital markets, which depends substantially on the success of the Company's ongoing research and development programs.' The Company's balance sheet at July 31, 2010, showed C$18,114,000 in total assets, C$2,281,000 in total liabilities, C$72,000 in deferred lease credit - non current, and stockholders' equity of C$15,761,000. A full-text copy of the earnings release is available for free at: http://researcharchives.com/t/s?6d48 A full-text copy of the annual report on Form 20-F filed with the U.S. Securities and Exchange Commission is available for free at: http://researcharchives.com/t/s?6d49 About Helix BioPharma Aurora, Ontario-based Helix BioPharma Corp. -- http://www.helixbiopharma.com/-- is a biopharmaceutical company specializing in the field of cancer therapy. The Company is actively developing innovative products for the prevention and treatment of cancer based on its proprietary technologies. Helix's product development initiatives include its novel L-DOS47 new drug candidate and its Topical Interferon Alpha- 2b. Helix is listed on the TSX, NYSE Amex and FSE under the symbol "HBP". HONOLULU SYMPHONY: Reaches Settlement with Musicians' Union ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Honolulu Symphony orchestra is asking the bankruptcy court to extend its exclusive right to propose a Chapter 11 plan. The Debtor said it cannot file a Chapter 11 plan until the settlement with union representing musicians is formally approved. A hearing on the exclusivity motion will be held Dec. 18. Mr. Rochelle relates the Debtor negotiated a settlement of an unfair labor practices complaint with the union representing musicians. The symphony said in a court filing that it was "highly unlikely" there could have been a reorganization plan without a settlement with the union. Assuming the symphony's board and the union formally agree, the musicians will waive claims for back pay and severance. Absent waiver, the claims would have been administrative expenses requiring full payment. The symphony said the settlement was "brokered" by the National Labor Relations Board. Honolulu Symphony filed for Chapter 11 on Dec. 18, 2009 in its hometown (Bankr. D. Hawaii Case No. 09-02978), saying assets are less than $500,000 while debt exceeds $1 million. The symphony blamed the filing on a decline in donations which left the orchestra unable to cover costs, since ticket sales represent only 30% of the budget. The symphony said it would use Chapter 11 to reorganize fundraising activities. HYDROGENICS CORP: Hosts Third Quarter Conference Call November 10 ----------------------------------------------------------------- Hydrogenics Corporation announced Thursday that it will host a conference call at 10:00 a.m. Eastern on November 10, 2010, for the third quarter ended September 30, 2010. Earnings will be issued before the market opens that day, and the filing of the Company's results with the appropriate regulatory bodies will follow. During the call, Daryl Wilson, President and Chief Executive Officer, and Lawrence Davis, Chief Financial Officer, will review the Company's financial results. The telephone number for the conference call is 877-307-1373 or, for international callers, 678-224-7873. A live webcast of the call will also be available on the company's Web site, http://www.hydrogenics.com About Hydrogenics Corporation Hydrogenics Corporation (Nasdaq: HYGS) (TSX:HYG) -- http://www.hydrogenics.com/-- is a globally recognized developer and provider of hydrogen generation and fuel cell products and services, serving the growing industrial and clean energy markets. Based in Mississauga, Ontario, Canada, Hydrogenics has operations in North America and Europe. The Company's balance sheet at June 30, 2010, showed $31.2 million in total assets, $14.6 million in total liabilities, and stockholders' equity of $16.6 million. The Company discloses in its report on the Corporation's results of operations for the second quarter ended June 30, 2010, that the Corporation's recurring operating losses and negative cash flows from operations and the risk of securing additional funding cast substantial doubt about the Corporation's ability to continue as a going concern. The Corporation expects these conditions to continue in the near term. "The Corporation's ability to continue as a going concern and manage the material uncertainties is dependent on the successful execution of its business plan, which involves: (i) securing additional financing to fund its operations; (ii) continued investment in research and development through advancing product designs for efficiency, durability, cost reduction and entry into complementary markets to improve overall gross margins; (iii) increasing market penetration and sales to improve operating cash flow; and (iv) actively managing its working capital to preserve cash resources. At present, the success of these initiatives cannot be assured due to the material uncertainties described above." HYUN UM: Files Schedules of Assets and Liabilities -------------------------------------------------- Hyun J. Um and Jin S. Um filed with the U.S. Bankruptcy Court for the Western District of Washington its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $2,249,284 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $194,919 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $347,644,068 ----------- ----------- TOTAL $2,249,284 $347,838,987 Tacoma, Washington-based Hyun J. Um and Jin S. Um filed for Chapter 11 protection on August 17, 2010 Bankr. W.D. Wash. Case No. 10-41789). Attorneys at Crocker Law Group PLLC serve as counsel to the Debtors. HYUN UM: Taps Crocker Law to Handle Reorganization Case ------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Washington authorized Hyun J. Um and Jin S. Um to employ Crocker Law Group PLLC as counsel. CLG will represent the Joint Debtors in their Chapter 11 proceedings. To the best of the Debtors' knowledge CLG is a ?disinterested person? as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Crocker Law Group 720 Olive Way, Suite 1000 Seattle, WA 98101-1853 Tel: (206) 624-9894 Fax: (206) 624-8598 About Hyun J. Um and Jin S. Um Tacoma, Washington-based Hyun J. Um and Jin S. Um filed for Chapter 11 protection on August 17, 2010 Bankr. W.D. Wash. Case No. 10-41789). The Debtors disclosed $2,249,284 in assets and $347,838,987 in liabilities as of the Petition Date. HYUN UM: U.S. Trustee Forms Three-Member Creditors Committee ------------------------------------------------------------ Robert D. Miller, Jr., U.S. Trustee for Region 18, appointed three members to the official committee of unsecured creditors in the Chapter 11 case of Hyun J. Um and Jin S. Um. The Creditors Committee members are: 1. David Bolotin (chairperson) chief financial officer Soundbuilt Northwest LLC P.O. Box 73790 Puyallup, WA 98373 Tel: (253) 830-2864 Fax: (253) 539-0514 2. Daniel Halstrom assistant vice president, special assets Sterling Savings Bank 111 N. Wall Street Spokane, WA 99201 Tel: (509) 363-8156 Fax: (509) 458-2384 3. Sabrina P. Loiselle legal counsel and senior vice president First Independent Bank 1220 Main Street, Suite 260 Vancouver, WA 98660 Tel: (360) 759-3508 Fax: (360) 619-4336 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. Tacoma, Washington-based Hyun J. Um and Jin S. Um filed for Chapter 11 protection on August 17, 2010 Bankr. W.D. Wash. Case No. 10-41789). Attorneys at Crocker Law Group PLLC serve as counsel to the Debtors. The Debtors disclosed $2,249,284 in assets and $347,838,987 in liabilities as of the Petition Date. I-10 BARKER: U.S. Trustee Unable to Form Creditors Committee ------------------------------------------------------------ Charles F. McVay, the U.S. Trustee for Region 7, notified the U.S. Bankruptcy Court for the Southern District of Texas that he was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of I-10 Barker Cypress, Ltd. The U.S. Trustee explained that the unsecured creditors showed insufficient indications of willingness to serve on the committee. I-10 Barker Cypress, Ltd., is a Texas limited partnership with its principal place of business in Houston, Harris County, Texas and with offices in Houston, Harris County, Texas. I-10 Baker owns an 83,000 square foot shopping center on 17.2 acres of commercial land located in Houston, Texas. Houston, Texas-based I-10 Barker Cypress, Ltd., filed for Chapter 11 bankruptcy protection on August 2, 2010 (Bankr. S.D. Tex. Case No. 10-36582). James B. Jameson, Esq., at James Jameson & Associates, serves as counsel to the Debtor. In its schedules, the Debtor disclosed $24,991,061 in total assets and $17,737,313 in total liabilities as of the Petition Date. INNKEEPERS USA: Wants Plan Filing Exclusivity Until March 16 ------------------------------------------------------------ Innkeepers USA Trust and certain of its affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to extend their exclusive periods to file and solicit acceptances for the proposed Plan of Reorganization until March 16, 2011, and May 15, respectively. The Debtors filed their request for an extension before the exclusive periods was set to expire on November 16, 2010. The Debtors related that they have taken steps to promote their plan process, including, among other things: -- The Board of Trustees of Innkeepers USA Trust established a committee consisting of its independent trustees to facilitate the Debtors' plan process. Pursuant to resolutions adopted by the board, the independent committee will explore and preliminarily vet all plan-related proposals. -- The Debtors met with their key stakeholders and others - including their secured lenders, the official committee of unsecured creditors, the ad hoc committee of preferred shareholders, and Five Mile Capital Partners LLC, party considered as potential stalking horse, and plan sponsor, - to develop a path forward that maximizes the value of the entire enterprise and takes into account the diverse views of their many stakeholders. -- The Debtors provided all of these parties access to their online data room and are facilitating due diligence. The Debtors also said that Moelis & Company, their financial advisor, discussed a range of options for the board to consider from a potential recapitalization of the Debtors' reorganized enterprise to transactions involving the sale of hotels on a property-by-property basis. The Debtors need more time to allow interested parties to complete their diligence so that the Debtors, their stakeholders, and potential interested parties are able to negotiate with sufficient information about the terms of a consensual restructuring. The Debtors propose a hearing on the requested exclusivity extension on November 10 at 10:00 a.m. prevailing Eastern Time. Objections, if any, are due November 5 at 4:00 p.m. About Innkeepers USA Trust Innkeepers USA Trust is a self-administered Maryland real estate investment trust with a primary business focus on acquiring premium-branded upscale extended-stay, mid-priced limited service, and select-service hotels. Innkeepers, through its indirect subsidiaries, owns and operates an expansive portfolio of 72 upscale and mid-priced extended-stay and select-service hotels, consisting of approximately 10,000 rooms, located in 20 states across the United States. Apollo Investment Corporation acquired Innkeepers in June 2007. Innkeepers USA Trust and a number of affiliates filed for Chapter 11 on July 19, 2010 (Bankr. S.D.N.Y. Case No. 10-13800). Attorneys at Kirkland & Ellis LLP, serve as counsel to the Debtors. AlixPartners is the restructuring advisor and Marc A. Beilinson is the chief restructuring officer. Moelis & Company is the financial advisor. Omni Management Group, LLC, is the claims and notice agent. The petition estimated assets and debts of more than $1 billion as of the bankruptcy filing. In 2009, Innkeepers' consolidated revenues were approximately $292 million and adjusted EBITDA were approximately $85 million. The Company's consolidated assets for 2009 totaled approximately $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred approximately $1.29 billion of secured debt. INTELLIPHARMACEUTICS INT'L: Gets Non-Compliance Notice From NASDAQ ------------------------------------------------------------------ Intellipharmaceutics International Inc. received a letter on October 29, 2010 from NASDAQ, stating that Intellipharmaceutics is not in compliance with NASDAQ's 'minimum stockholders' equity' continued listing requirement of $2.5 million under NASDAQ Listing Rule 5550(b)(1). As of August 31, 2010, Intellipharmaceutics' stockholders' equity was approximately $1.8 million. The notice has no immediate effect on the listing of Intellipharmaceutics' common stock on NASDAQ Capital Market, and its common stock will continue to trade on the NASDAQ under the symbol "IPCI" pending any further action taken by NASDAQ as described below. The notice will not affect the listing of the common stock on the Toronto Stock Exchange ("TSX"), which continues to trade under the symbol "I" in ongoing compliance with TSX listing conditions. In accordance with NASDAQ Listing Rules, Intellipharmaceutics has 45 calendar days, or until December 13, 2010 to submit to NASDAQ a plan of compliance detailing the actions Intellipharmaceutics has taken, or plans to take, that would bring it into compliance with this stockholders' equity requirement. If the Company submits its plan and the plan is accepted, NASDAQ can grant an extension of up to 180 calendar days from October 29, 2010 for the Company to evidence compliance. Alternatively, Intellipharmaceutics could return to compliance if it satisfies the $35.0 million minimum for the 'market value of listed securities' continued listing requirement which is one of the alternatives to the 'minimum stockholders' equity' continued listing requirement under Rule 5550(b). If Intellipharmaceutics submits a plan of compliance and NASDAQ does not accept the Company's plan and does not meet the alternate continued listing requirement under Rule 5550(b), NASDAQ may then initiate delisting proceedings from NASDAQ, at which time Intellipharmaceutics may appeal NASDAQ's determination to a Listing Qualifications Panel. In the event of an appeal, the Company's common stock would remain listed on the NASDAQ Capital Market pending a decision by the Panel following the hearing. The Company also today announced that Graham Neil has resigned as CFO, effective November 26, to pursue other business opportunities. Dr. Amina Odidi, who is presently President, COO and a director of the Company and who had previously served for several years as the Company's CFO until October 2009, has been appointed as acting CFO, pending the appointment of a permanent replacement. 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. J & J CONSTRUCTION: U.S. Trustee Wants Case Converted to Chapter 7 ------------------------------------------------------------------ Donald F. Walton, the U.S. Trustee for Region 21, asks the U.S. Bankruptcy Court for the Northern District of Georgia to dismiss or convert the Chapter 11 case of J & J Construction Group, Inc., to one under Chapter 7 of the Bankruptcy Code. The U.S. Trustee explains that the Debtor is delinquent: -- in filing the monthly operating reports for the months June through August 2010; and -- in remitting quarterly fees to the U.S. Trustee. The Debtor has been assessed estimated fees totaling $300. However, without the Debtor's monthly operating reports for the months of June through October 2010, it is impossible for the U.S. Trustee to accurately calculate the appropriate fees. As reported in the Troubled Company Reporter on September 15, the Debtor asked the Court to conditionally convert its Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. The Debtor said that secured creditor Habersham Bank represented that it would prefer to be bought out and further represented that it would accept $2.5 million for 100% of its secured interest in a 46,800 sq. ft retail/medical building development and a 0.52 acre outparcel located at Powder Springs Road and Milford Church Road in Marietta Georgia. The Debtor obtained an offer to purchase from a qualified cash purchaser that provided for Habersham to receive $2.5 million. The offer also provided for the bankruptcy estate to receive $200,000 to cover the claims its remaining creditors, trustee fees, administrative fees, etc. Once the Debtor presented the commitment to purchase to Habersham Bank, the bank declined to accept the same. About J & J Construction Group Roswell, Georgia-based J & J Construction Group, Inc., is in the business of acquiring, developing and managing commercial property. The Company developed commercial retail and office building projects and acquired raw land for future speculation and development since its inception in 2001. The Company filed for Chapter 11 bankruptcy protection on May 31, 2010 (Bankr. N.D. Ga. Case No. 10-76169). Rodney L. Eason, Esq., at The Eason Law Firm, assists the Debtor in its restructuring effort. The Company disclosed $13,591,800 in assets and $7,941,112 in liabilities as of the Petition Date. JOHN KONECNIK: Has Until December 22 to Propose Chapter 11 Plan --------------------------------------------------------------- The Hon. Caryl E. Delano of the U.S. Bankruptcy Court for the Middle District of Florida directed John P. Konecnik, Jr., to file his Chapter 11 Plan and Disclosure Statement by. December 22, 2010. Headquartered in Nokomis, Florida, John P. Konecnik, Jr., filed for Chapter 11 protection on August 24, 2010 (Bankr. M.D. Fla. Case No. 10-20279). The Law Offices Lynn Ramey serves as the Debtor's bankruptcy counsel. The Debtor disclosed $24,958,072 in assets and $14,129,383 in debts as of the Petition Date. Debtor-affiliate Fisherman's Warf of Venice, Inc., filed for separate Chapter 11 petition on May 4, 2010 (Bankr. M.D. Fla. Case No. 10-10694). JOHN YEDINAK: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Joint Debtors: John G. Yedinak Lynn G. Yedinak 530 North Lake Shore Drive, Unit 2201 Chicago, IL 60611 Bankruptcy Case No.: 10-48535 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: Bruce W. Black Debtors' Counsel: Gregory K. Stern, Esq. GREGORY K. STERN, P.C. 53 West Jackson Boulevard, Suite 1442 Chicago, IL 60604 Tel: (312) 427-1558 Fax: (312) 427-1289 E-mail: gstern1@flash.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Joint Debtors' 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ilnb10-48535.pdf JULIUS JOHNSON: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Julius Everette Johnson 2405 Lake Loreine Lane Richmond, VA 23233 Bankruptcy Case No.: 10-37538 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Eastern District of Virginia (Richmond) Judge: Kevin R. Huennekens Debtor's Counsel: David H. Worrell, Jr., Esq. THE WORRELL LAW FIRM 710 N. Hamilton Street, Suite 100 Richmond, VA 23221 Tel: (804) 358-2328 Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Thomas H. Barringer Promissory Note $1,750,000 802 Forest Hill Drive Greensboro, NC 27410 Carolina Linen Servicces Promissory Note $1,700,000 802 Forest Hill Drive Greensboro, NC 27410 Pranab & Guari Sen Promissory Note $532,500 110 Baskerville Circle Chapel Hill, NC 27514 Emma Lockhart Promissory Note $350,000 233 Lockhart Road Jefferson, SC 29718 Linda & Fred Parham Promissory Note $327,000 1210 Oakview Drive Greenville, NC 27858 Matthew J. Goodman Promissory Note $310,000 262 Meridian Way Henderson, NC 27537 Phil Mitchell Promissory Note $298,000 5005 Rancher Avenue Las Vegas, NV 89108 Nancy Tripoli Promissory Note $240,000 Cathee J. Huber Promissory Note $230,000 Olga Colwell Promissory Note $220,000 Sally Proctor Promissory Note $207,407 A.S.J. Hopkins, III Promissory Note $200,000 Willie Caplan Promissory Note $200,000 M.L. Pinchback Promissory Note $200,000 L. Ray Bailey Promissory Note $200,000 Johnea D. Kelly Promissory Note $185,000 Jimmie L. Collins Promissory Note $170,000 Stanley Jeter Promissory Note $165,000 Stephen Bai Promissory Note $160,000 John F. Massie Promissory Note $160,000 KINGSWAY FINANCIAL: AM Best Affirms 'B-' Financial Strength Rating ------------------------------------------------------------------ A.M. Best Co. has removed from under review with negative implications and affirmed the financial strength ratings (FSR) of B- (Fair) and issuer credit ratings (ICR) of "bb-" of Kingsway Amigo Insurance Company (Miami, FL) and Universal Casualty Company (Elk Grove Village, IL). The outlook assigned to these ratings is negative. A.M. Best also has affirmed the FSR of B- (Fair) and ICR of "bb-" of American Service Insurance Company, Inc. (ASI) and American Country Insurance Company (ACI) (both domiciled in Elk Grove Village, IL). These ratings remain under review, and the implications have been revised to developing from negative. Additionally, A.M. Best has affirmed the FSR of B- (Fair) and ICR of "bb-" of Mendota Insurance Company and its wholly owned subsidiary, Mendakota Insurance Company (both domiciled in Eagan, MN). The companies comprise the Mendota Group, and their ratings remain under review with negative implications. Concurrently, A.M. Best has upgraded the FSR to B- (Fair) from C++ (Marginal) and ICR to "bb-" from "b" of Kingsway Reinsurance Corporation (KRC) (Barbados). The ratings have been removed from under review with negative implications and assigned a negative outlook. At the same time, A.M. Best has removed from under review with negative implications and affirmed the ICRs of "ccc" and senior debt ratings of "ccc" of Kingsway Financial Services Inc (KFSI) and Kingsway America Inc. (both domiciled in Elk Grove Village, IL). The outlook assigned to these ratings is negative. The ratings for KFSI and its subsidiaries are reflective of their weak capitalization, above average financial and operating leverage, unprofitable earnings trend and the challenges they face from strong competitive markets, weak economic conditions, below average interest rates, declining premium volume and rising claims costs. These concerns are partially offset by KFSI's actions to reorganize operations to improve efficiency and customer service; deleverage the balance sheet and improve liquidity by selling assets for cash and reducing debt; improve performance by cancelling non-core lines of business, unprofitable agents and accounts; focus on core non-standard automobile insurance; and consolidate management and back office operations. The ratings for ASI and ACI are based upon an intercompany pooling agreement between the two companies. Their ratings are under review with developing implications due to KFSI's actions to find new ownership by creating a publicly traded holding company to hold their shares. Successful execution of the plan is expected to improve capitalization, reduce leverage, improve operating performance and enhance both companies' business profile. However; KFSI faces significant execution risk in attracting investors. These ratings will remain under review pending a thorough review of all circumstances following completion of the transaction. The ratings for the Mendota Group remain under review with negative implications due to the uncertainty involved with its future financial strength. KFSI is in the process of selling the Mendota Group and anticipates completing a transaction before year-end 2010. KRC's ratings were upgraded to recognize its improved balance sheet strength and leverage position due to commutation with its U.S. affiliates in 2009. The negative outlook is based on the uncertainty of the company's role within the KFSI organization going forward and the permanency of its current capital position. The company is currently in run off. The following debt ratings have been affirmed: Kingsway America Inc.: -- "ccc" on US$125 million 7.5% senior unsecured notes, due 2014 (currently US$25.2 million outstanding); -- "ccc" on US$74.1 million 7.12% senior unsecured notes, due 2015 (currently USD 14.8 million in the possession of non- KFSI owners) Kingsway Financial Services Inc: -- "ccc" on CAD100 million 6% senior unsecured debentures, due 2012 (currently CAD11.9 million outstanding) All senior debt is unconditionally guaranteed by KFSI and KAI. KORI PAGE: Case Summary & 10 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Kori J. Page aka Kori J. Jensen 603 Seagaze Drive, #713 Oceanside, CA 92054 Bankruptcy Case No.: 10-19528 Chapter 11 Petition Date: October 31, 2010 Court: U.S. Bankruptcy Court Southern District of California (San Diego) Judge: Peter W. Bowie Debtor's Counsel: Arthur Stockton, Esq. STOCKTON LAW OFFICES 27322 Calle Arroyo, Suite 36D San Juan Capistrano, CA 92675 Tel: (866) 682-8776 Fax: (866) 207-4082 E-mail: art@stocktonlawoffices.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/casb10-19528.pdf LAKEVIEW AT CAROLINA: Reorganization Case Converted to Chapter 7 ---------------------------------------------------------------- The Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the Eastern District of North Carolina approved the conversion of Lakeview at Carolina Beach, LLC's the Chapter to one under Chapter 7 of the Bankruptcy Code. The Court also directed the that the Debtor (i) immediately turn over all records and property of the estate in its possession or control to the trustee upon his appointment; (ii) file with the court a final report and account of the Chapter 11 estate, listing receipts and disbursements and disposition of any property. Dallas, Texas-based Lakeview at Carolina Beach, LLC, filed for Chapter 11 bankruptcy protection on July 19, 2010 (Bankr. E.D. N.C. Case No. 10-05718). Eric A. Liepins, Esq., who has an office in Dallas, Texas, assisted the Company in its restructuring effort. The Company disclosed $10,902,000 in assets and $9,486,585 in liabilities as of the Petition Date. LAS VEGAS MONORAIL: District Judge Affirms Right to File Ch. 11 --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Las Vegas Monorail Co. won out over bondholders who wanted the reorganization halted entirely pending appeal from a ruling by the bankruptcy judge in April concluding that the company has the right to reorganize in Chapter 11. Mr. Rochelle recounts that U.S. Bankruptcy Judge Bruce A. Markell in Las Vegas previously ruled that Monorail isn't a municipality and is therefore entitled to reorganize in Chapter 11. Bondholders appealed. Judge Markell denied a motion to stay the Chapter 11 case pending appeal. The motion for a stay was made by Ambac Assurance Corp., which provided insurance for the bondholders. Mr. Rochelle relates that on appeal, U.S. District Judge James Mahan in Reno upheld the bankruptcy judge and refused to stop the Chapter 11 case in an opinion handed down Oct. 29. Judge Mahan also ruled that the appeal wasn't being taken from a so-called final order. Judge Mahan said he therefore wouldn't hear the appeal on eligibility for Chapter 11 until the reorganization is concluded. Judge Mahan also agreed with Markell by saying that the bankruptcy rules don't allow halting an entire Chapter 11 case when an appeal is taken from one decision. About Las Vegas Monorail Las Vegas, Nevada-based Las Vegas Monorail Company, organized by the State of Nevada in 2000 as a nonprofit corporation, owns and manages the Las Vegas Monorail. The Monorail is a seven-stop, elevated train system that travels along a 3.9-mile route near the Las Vegas Strip. LVMC has contracted with Bombardier Transit Corporation to operate the Monorail. Though it benefits from its tax-exempt status due to being a nonprofit entity, LVMC claims to be the first privately-owned public transportation system in the nation to be funded solely by fares and advertising. LVMC says it receives no governmental financial support or subsidies. The Company filed for Chapter 11 bankruptcy protection on January 13, 2010 (Bankr. D. Nev. Case No. 10-10464). Gerald M. Gordon, Esq., at Gordon Silver, assists the Company in its restructuring effort. Alvarez & Marsal North America, LLC, is the Debtor's financial advisor. Stradling Yocca Carlson & Rauth is the Debtor's special bond counsel. Jones Vargas is the Debtor's special corporate counsel. The Company disclosed $395,959,764 in assets and $769,515,450 in liabilities as of the Petition Date. In May 2010, Ambac Assurance Corp. lost its bid to stay the bankruptcy case while a district court considers whether the bankruptcy court wrongly rejected Ambac's argument that Monorail was a municipality and thus ineligible to be a Chapter 11 debtor. LAWRENCE HERRERA: Case Summary & 14 Largest Unsecured Creditors --------------------------------------------------------------- Joint Debtors: Lawrence Jake Herrera Sonya Epperson Herrera 660 E. Galveston Street Gilbert, AZ 85295 Bankruptcy Case No.: 10-35184 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: George B. Nielsen, Jr. Debtors' Counsel: Harold I. Campbell, Esq. CAMPBELL & COOMBS, P.C. 1811 S. Alma School Road, Suite 225 Mesa, AZ 85210 Tel: (480) 839-4828 Fax: (480) 897-1461 E-mail: heciii@haroldcampbell.com Estimated Assets: $500,001 to 1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Joint Debtors' 14 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb10-35184.pdf LEHMAN BROTHERS: Bankr. Court Approves Danske Bank Settlement ------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York authorized Lehman Brothers Holdings Inc. and Lehman Commercial Paper Inc. to enter into an agreement with Danske Bank to settle their dispute over the ownership of properties that were sold to the bank. The Court authorized Danske to assume the obligations of the Lehman units arising from the documents securing the residential mortgage loans and real estate owned (REO) properties as of September 23, 2008. The properties were sold to Danske under a 2007 deal, which the bank and LCPI hammered out in connection with their 1999 master repurchase agreement. A dispute ensued between Danske and the Lehman units after the latter defaulted under the MRA as a result of their bankruptcy filing. The settlement deal requires Danske and the Lehman units to issue a joint direction to Aurora Loan Services LLC, authorizing the disbursement of $1,197,112 to LCPI and $33,728,137 to Danske. The remaining cash in the escrow account will be disbursed to Danske. Aurora Loan administers the escrow account where the proceeds from the assets are deposited. More than $34.9 million is reportedly deposited in the account as of September 27, 2010. 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: Caixa Wins Approval to Assign Interest in Note --------------------------------------------------------------- Caixa Geral De Depositos, S.A., a lender under an Uncommitted Unsecured Master Promissory Note and Guarantee, dated September 14, 2007, issued by Lehman Brothers Bankhaus Aktiengesellschaft, Lehman Brothers International (Europe), Lehman Commercial Paper Inc., Lehman Brothers Japan Inc., and Lehman Brothers Holdings Inc. -- "the Borrowers" -- won approval from the U.S. Bankruptcy Court for the Southern District of New York to assign or transfer its interests in the Promissory Note and its attendant claims against LBHI without further order of the Court or obtaining prior consent from LBHI. Barry N. Seidel, Esq., at Butzel Long, in New York, attorney for Caixa Geral de Depositos, S.A., relates that the Borrowers, on September 14, 2008, issued the Promissory Note to CGD for $100,000,000. Pursuant to the Promissory Note, on September 25, 2010, LBHI issued to CGD a Borrowing Notice, pursuant to which LBHI borrowed $100,000,000 from CGD, Mr. Seidel says. Mr. Seidel tells the Court that under the terms of the Promissory Note, the commencement of a bankruptcy case by LBHI constitutes an Event of Default. Moreover, the filing of LBHI's Chapter 11 petition resulted in an automatic acceleration of the amounts due under the Promissory Note, he adds. According to Mr. Seidel, interest totaling $148,932 accrued on the $100,000,000 borrowed by LBHI under the Promissory Note during the period from August 27, 2008, through the Petition Date. Therefore, as of the Petition Date, LBHI owed CGD $100,148,932 under the Promissory Note, Mr. Seidel maintains. CGD, on January 30, 2009, filed a proof of claim against LBHI for $100,148,932. Mr. Seidel says CGD has requested that the Borrowers consent to its assignment of its interests in the Promissory Note but has not received any response to its request. As a matter of public policy, the procedural consent provisions in the Promissory Note should not be strictly enforced in the context of LBHI's bankruptcy proceeding, because the assignee's identity is no longer relevant to LBHI, as the Borrower under a Promissory Note under which no further advances can be requested and under which there is a payment default, Mr. Seidel asserts. On the other hand, Mr. Seidel avers, CGD will be prejudiced if it is not able to transfer its Claim to a willing buyer free of the consent restrictions in the Promissory Note. 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: Taps Wollmuth as Counsel for Avoidance Suits ------------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliated debtors won approval of an application to employ Wollmuth Maher & Deutsch LLP as special counsel effective September 9, 2010. The Debtors tapped the firm to serve as their conflicts and special litigation counsel in connection with the prosecution of avoidance actions and other claims. Wollmuth will provide legal assistance to the Debtors in connection with litigation to be brought against certain trustees, special purpose entities and debt holders that received distributions as a result of the enforcement of provisions in transaction documents that purport to reverse the priority of payments on the occurrence of an event of default. Wollmuth will be paid for its services on an hourly basis and will be reimbursed for its expenses. The firm's professionals and their hourly rates are: Professionals Hourly Rates ------------- ------------ Partners $495-$615 Counsel attorneys $495 Associates $250-$425 Paraprofessionals $95-$195 In an affidavit, Paul DeFilippo, Esq., at Wollmuth, assures the Court that the firm does not have interest materially adverse to the interest of the Debtors' estate, and that the firm is a "disinterested person" under section 101(14) of the Bankruptcy Code. Tracy Hope Davis, the United States Trustee for Region 2, said she has reviewed the Application. Based on that review and on her monitoring of the Debtors' bankruptcy cases, she said she has no objection to the Application. 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: UP Recovery Seeks Immediate Claim Payment ---------------------------------------------------------- Paul Batista, Esq., in New York, relates that Unclaimed Property Recovery Service, Inc., has identified and claimed more than $8.4 million in unclaimed funds in the name of Lehman Brothers, Inc., its predecessors, subsidiaries and other Lehman entities held by the New York State Office of Unclaimed Funds. He notes that as of October 28, 2010, $8,451,918 has been deposited by NYS OUF and additional Lehman Unclaimed Funds will be deposited over the next several weeks. However, in defiance of an order entered by the Court on May 25, 2010, the Court's repeated admonitions to James W. Giddens, as SIPA trustee for Lehman Brothers Inc., and UPRS's accomplishments, LBI has refused to pay any portion of the fee to which UPRS is entitled. Accordingly, UPRS asks the Court to enter an order directing LBI to pay UPRS the minimum payment due totaling $750,000 within five days of the Court's approval of UPRS' Request. 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) LOEHMANN'S INC: Said to be Preparing Prepackaged Bankruptcy ----------------------------------------------------------- Loehmann's Inc. may file for bankruptcy protection as soon as next week after failing to reach an accord with creditors that would let it restructure outside court protection, Lauren Coleman- Lochner and Jonathan Keehner at Bloomberg News report, citing two people familiar with the plan. Loehmann's, according to the people, is preparing a so-called prepackaged bankruptcy, in which a company and its creditors agree to key terms before filing a petition with the court. "Discussions are ongoing, so the company is not prepared to comment further now," said Amy Rosenberg, a spokeswoman for Loehmann's. Loehmann's is working with law firm Cleary Gottlieb Steen & Hamilton LLP and Perella Weinberg Partners, according to the people. The Bronx, New York-based company is owned indirectly by Istithmar PJSC, an investment firm owned by the government of Dubai. Istithmar is weighing a new equity investment in the reorganized company of as much as $15 million, according to the people. On Oct. 29, acting Istithmar Chief Executive Officer Andy Watson said his company "continues to be supportive" of Loehmann's. Istithmar is "actively working with management, bondholders and other stakeholders to find a mutually agreeable position to save the company," Watson said, according to an e- mailed statement then. Loehmann's is a discount retailer with more than 60 stores. Loehmann's, founded almost 90 years ago, sells clothes from brands such as Michael Kors, Calvin Klein and Donna Karan at more than 55 U.S. stores. M&T BANK: Wilmington Trust Deal Cues Moody's Rating Reviews ----------------------------------------------------------- Moody's Investors Service placed the ratings of M&T Bank Corporation and its subsidiaries under review for possible downgrade. The holding company is rated A3 for senior debt and its lead bank, Manufacturers & Traders Trust Company, is rated C+ for stand-alone bank financial strength and A2/Prime-1 for deposits. In a related action, Moody's placed the ratings of Wilmington Trust Corporation and its subsidiary, Wilmington Trust Company, under review with the direction uncertain. The holding company has an issuer rating of Baa3 and the bank is rated C- for stand-alone bank financial strength and Baa2/Prime-2 for deposits. The rating reviews follow the announcement that M&T has entered into a definitive agreement to acquire Wilmington Trust in an all stock transaction valued at $351 million. Moody's said the review on M&T will focus on the company's capital management plans, particularly its tangible common equity position following the acquisition, as well as its plans to repay TARP preferred stock. M&T's capital position has traditionally been managed to lower levels than similarly-rated peers. In Moody's view, this is a credit challenge especially considering M&T's sizable concentration in commercial real estate, which will increase with the acquisition. Moody's noted that M&T's current ratings are supported by its diversified regional consumer and commercial banking businesses in the Northeast and Mid-Atlantic states and its strong underlying operating efficiency. In addition, M&T has remained profitable and demonstrated lower earnings volatility than many of its large U.S. regional bank peers throughout the crisis by effectively managing its credit costs. Moody's said the review on Wilmington Trust will focus on the likelihood of completion of the transaction with M&T. If the transaction is completed as planned, Wilmington Trust's ratings would likely be upgraded to those of M&T. If the transaction is terminated and no alternative capital plans are announced, a multi-notch downgrade of Wilmington Trust's ratings is possible. Wilmington Trust's losses, which have been driven by its high commercial real estate exposure and are likely to remain elevated in the near-term, could lead to further significant reductions in its capital base. This would be magnified by the company's inability to tax-effect future losses because of the large valuation allowance on its deferred tax asset. At September 30, 2010, following its $365 million net loss, Wilmington Trust's Tier 1 Common Ratio was 5.65%, which is a low level. Additionally, Wilmington Trust's fee-generating businesses could be compromised by customer attrition to the extent that losses continue and/or the M&T transaction does not get completed. The last rating action on M&T was on May 14, 2009, when Moody's downgraded the long-term ratings of M&T Bank Corporation (senior debt to A3 from A2) and its subsidiaries, including its lead bank (bank financial strength to C+ from B-; deposits to A2 from A1). Moody's last rating action on Wilmington Trust was on April 24, 2009, when Moody's downgraded the long-term ratings of Wilmington Trust Corporation (issuer rating to Baa3 from Baa1) and Wilmington Trust Company (bank financial strength rating to C- from C; deposits to Baa2 from A3). M&T Bank Corporation is headquartered in Buffalo, New York and reported assets of $68.2 billion at September 30, 2010. Wilmington Trust Corporation is headquartered in Wilmington, Delaware and reported assets of $10.4 billion at September 30, 2010. On Review for Possible Downgrade: Issuer: Allfirst Preferred Asset Trust -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: Allfirst Preferred Capital Trust -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: First Maryland Capital I -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: First Maryland Capital II -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: M&T Bank Corporation -- Issuer Rating, Placed on Review for Possible Downgrade, currently A3 -- Multiple Seniority Shelf, Placed on Review for Possible Downgrade, currently (P)Baa3, (P)A3 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A3 Issuer: M&T Capital Trust I -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: M&T Capital Trust II -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: M&T Capital Trust III -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 Issuer: M&T Capital Trust IV -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently Baa2 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)Baa2 Issuer: M&T Capital Trust V -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)Baa2 Issuer: M&T Capital Trust VI -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)Baa2 Issuer: Manufacturers and Traders Trust Company -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C+ -- Issuer Rating, Placed on Review for Possible Downgrade, currently A2 -- OSO Rating, Placed on Review for Possible Downgrade, currently P-1 -- Deposit Rating, Placed on Review for Possible Downgrade, currently P-1 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently A2 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A3 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently A2 On Review Direction Uncertain: Issuer: Wilmington Trust Company -- Bank Financial Strength Rating, Placed on Review Direction Uncertain, currently C- -- Issuer Rating, Placed on Review Direction Uncertain, currently Baa2 -- OSO Rating, Placed on Review Direction Uncertain, currently P-2 -- Deposit Rating, Placed on Review Direction Uncertain, currently P-2 -- OSO Senior Unsecured OSO Rating, Placed on Review Direction Uncertain, currently Baa2 -- Senior Unsecured Deposit Rating, Placed on Review Direction Uncertain, currently Baa2 Issuer: Wilmington Trust Corporation -- Issuer Rating, Placed on Review Direction Uncertain, currently Baa3 -- Multiple Seniority Shelf, Placed on Review Direction Uncertain, currently (P)Ba1, (P)Baa3 -- Subordinate Regular Bond/Debenture, Placed on Review Direction Uncertain, currently Ba1 Outlook Actions: Issuer: Allfirst Preferred Asset Trust -- Outlook, Changed To Rating Under Review From Negative Issuer: Allfirst Preferred Capital Trust -- Outlook, Changed To Rating Under Review From Negative Issuer: First Maryland Capital I -- Outlook, Changed To Rating Under Review From Negative Issuer: First Maryland Capital II -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Bank Corporation -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Capital Trust I -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Capital Trust II -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Capital Trust III -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Capital Trust IV -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Capital Trust V -- Outlook, Changed To Rating Under Review From Negative Issuer: M&T Capital Trust VI -- Outlook, Changed To Rating Under Review From Negative Issuer: Manufacturers and Traders Trust Company -- Outlook, Changed To Rating Under Review From Negative Issuer: Wilmington Trust Company -- Outlook, Changed To Rating Under Review From Negative Issuer: Wilmington Trust Corporation -- Outlook, Changed To Rating Under Review From Negative MAGIC BRANDS: Seeks More Time to Finalize Liquidation Plan ---------------------------------------------------------- The bankruptcy estate of Fuddruckers Inc. said it needs more time to engineer a liquidation plan following the sale of its hamburger restaurants to Luby's cafeteria chain. Deel LLC -- the name bestowed upon Fuddruckers' bankruptcy case in the wake of its sale this summer -- is seeking to maintain control of its proceedings for an extra 60 days as it continues to wind down its business and puts the final touches on its Chapter 11 proposal, Dow Jones' DBR Small Cap reports. According to the report, the company said it spent the first three months of its case stabilizing its business and launching its sale process, which culminated with a winning offer from Luby's at a June 17 auction. The sale closed on July 26. Since then, the company has been drafting a creditor-repayment proposal, the report notes. But it said it still needs more time to move toward a confirmation hearing, the report adds. About Magic Brands Headquartered in Austin, Texas, Magic Brands, LLC -- http://www.fuddruckers.com/-- operated 62 Fuddruckers locations in 11 states and 3 Koo Koo Roo restaurants in California. Magic Brands, LLC, and its operating units filed for Chapter 11 protection on April 21, 2010 (Bankr. D. Del. Lead Case No. 10- 11310). It estimated assets of up to $10 million and debts at $10 million to $50 million in its Chapter 11 petition. Affiliate Fuddruckers, Inc., also filed, estimating assets and debts at $50 million to $100 million. FocalPoint Securities, LLC, serves as investment banker to Magic Brands, and Goulston & Storrs serves as lead bankruptcy counsel. Kurtzman Carson Consultants, LLC, is the claims and notice agent. In July 2010, Magic Brands closed the sale of the Fuddruckers stores and franchise business to restaurant operator Luby's Inc. for $63.5 million. The Company changed its name to Deel, LLC following the completion of the sale. MARK LOWRY: Case Summary & 6 Largest Unsecured Creditors -------------------------------------------------------- Joint Debtors: Mark R. Lowry Venessa H. Lowry 6435 Louina Road Roanoke, AL 36274 Bankruptcy Case No.: 10-81746 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Middle District of Alabama (Opelika) Judge: William R. Sawyer Debtors' Counsel: John M. Caraway, Jr., Esq. CAMPBELL & CAMPBELL, P.C. P.O. Drawer 756 Talladega, AL 35161-0756 Tel: (256) 761-1858 Fax: (256) 362-5966 E-mail: John@campbellandcampbellpc.com Scheduled Assets: $4,121,684 Scheduled Debts: $3,849,081 A list of the Joint Debtors' six largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/almb10-81746.pdf MARSHALL GROUP: Plan of Reorganization Wins Court Approval ---------------------------------------------------------- The Hon. Randall L. Dunn of the U.S. Bankruptcy Court for the District of Oregon confirmed the Plan of Reorganization for The Marshall Group, LLC. As reported in the Troubled Company Reporter on June 29, 2010, Conrad Myers, Chapter 11 trustee for the Debtor, submitted a Plan proposed by the creditors of the Debtor's estate. The Plan contemplates that unsecured creditors that each have claims in excess of $100 will be paid from excess cash flow from operation of the Reorganized Debtor's business, after certain other payments to creditors are made. In addition, unsecured creditors will receive the net proceeds from the ultimate sale of the clinics. The Trustee anticipates $1 million and $1.5 million available to pay creditors over a period of 24 to 60 months. The trustee estimates this will lead to a distribution of between 10% and 20% (without a discount for the time value of money) to each unsecured creditor. Unsecured creditors owed less than $100 may either receive (1) a cash payment of 20% of their claim within 30 days of the effective date of the Plan, or (2) receive a voucher for services equal to the greater of 50% of their claim or $15. A full-text copy of the confirmation order and the Second Amended Plan is available for free at: http://bankrupt.com/misc/MarshallGroup_2ndAmendedPlan.pdf About The Marshall Group LLC The Marshall Group LLC owns and operates two medical clinics -- one in Redmond, Oregon, and the second in McMinnville, Oregon. The Debtor also owns several parcels of real property in McMinnville, Oregon. There is a new three-story office building, former hotel, restaurant, and 2 empty houses on the McMinnville Complex. The Debtor has completed construction of the first floor of its office building. It has leased space on the first floor. Construction on the second and third floors is not completed. The Company filed for Chapter 11 protection on Sept. 4, 2008 (Bankr. D. Ore. Case No. 08-34585). Gary U. Scharff, Esq., at Gary Underwood Scharff Law Office, in Portland, Oregon, serves as bankruptcy counsel to the Debtor. The Debtor disclosed $12,559,346 in assets and $12,913,569 in liabilities as of the Petition Date. MCKESSON CORP: US Oncology Deal Cues Moody's to Keep 'Ba1' Rating ----------------------------------------------------------------- Moody's Investors Service affirmed the ratings of McKesson Corporation (Baa2/Prime-2) and its stable outlook following news that the company has signed a definitive agreement to acquire U.S. Oncology for approximately $2.16 billion. At the same time, Moody's is placing the ratings of U.S. Oncology Holdings, Inc. (CFR of B2) and U.S. Oncology, Inc., under review for possible upgrade. Moody's understands that McKesson plans to refinance the existing debt of U.S. Oncology, which will add about $1.7 billion of incremental debt to its balance sheet. Moody's anticipates that U.S. Oncology's existing ratings will be withdrawn if the debt is taken out. "Moody's believe the acquisition of U.S. Oncology will reduce McKesson's flexibility to engage in further acquisitions, but its financial strength measures should remain at levels appropriate for its Baa2 rating," said Diana Lee, a Moody's Senior Credit Officer. "This is among the largest acquisitions that McKesson has made in the recent past and comes on the heels of an accelerated buyback initiative," continued Ms. Lee. U.S. Oncology should offer McKesson greater opportunities to partner with community-based oncologists, augmenting its existing specialty distribution business. However, U.S. Oncology's EBITDA levels and margins have been under pressure in recent years as tougher ESA (erythropoietin-stimulating agent) prescribing guidelines for treating anemia in cancer patients continue to affect profitability. Moody's believe that the impact of further requirements or guidelines, including the potential for CMS to issue a national coverage decision on the use of ESAs is unknown at this time. McKesson's Baa2 rating reflects its position as one of the nation's leading drug distributors, but also considers extremely thin operating margins that remain subject to pressure from customers. Compared to its peers, however, McKesson does benefit from its higher margin technology solutions business, which accounts for about 15-20% of operating profits. The stable outlook reflects Moody's expectation that as McKesson takes on this incremental debt, it will sustain, at a minimum, financial strength ratios consistent with a Baa2 rating (including FCF/Debt of 20%). It further assumes that the company is likely to maintain leverage below the upper end of its 30-40% target reported Debt/Capitalization ratio. If future debt-financed acquisitions or buybacks result in leverage that is sustained at the high end of or above the company's targeted Debt/Capitalization ratio, financial strength measures fall below those consistent with a Baa2 rating, or margins show material deterioration, the ratings could be downgraded. In light of incremental debt, an upgrade is unlikely over the foreseeable future. Over time, if the company can sustain ongoing margin improvement, achieve greater balance across its various distribution and IT segments, as well as return to more moderate levels of acquisition and share buyback activity, the ratings could face upward pressure. Ratings affirmed: McKesson Corporation -- Baa2 senior unsecured notes -- Baa2 backed industrial revenue bonds -- (P)Baa2 senior unsecured shelf -- (P)Baa3 subordinated shelf -- (P)Baa3 senior subordinated shelf -- (P)Baa3 junior subordinated shelf -- (P)Ba1 preferred shelf -- Prime-2 short-term rating -- McKesson Canada Corporation -- Prime-2 short-term rating Ratings placed under review for possible upgrade: U.S. Oncology Holdings, Inc. -- B2 Corporate Family Rating -- B2 PDR -- Caa1 (LGD6, 90%) senior unsecured notes U.S. Oncology, Inc. -- Ba3 (LGD2, 27%) senior secured 2nd lien notes -- B3 (LGD5, 74%) senior subordinated notes The last rating action for McKesson was taken on June 21, 2010, when Moody's raised the company's long term and short term ratings to Baa2 and Prime-2, respectively. The last rating action for U.S. Oncology was taken on June 4, 2009, when Moody's assigned a Ba3 rating to the company's new second lien secured notes and upgraded the existing senior notes to Ba3. McKesson'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 McKesson's core industry and McKesson's ratings are believed to be comparable to those of other issuers of similar credit risk. McKesson Corporation, located in San Francisco, California, is a leading pharmaceutical drug distributor. Its information systems business provides software and hardware support to a large portion of the nation's hospitals. The company reported revenues of about $110 billion for the twelve months ended September 30, 2010. MEADOWS OF JUPITER: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Meadows of Jupiter Florida Condo, LLC 6701 Mallards Cove Road Jupiter, FL 33458 Bankruptcy Case No.: 10-43407 Chapter 11 Petition Date: October 29, 2010 Court: U.S. Bankruptcy Court Southern District of Florida (West Palm Beach) Judge: Paul G. Hyman, Jr. Debtor's Counsel: David L. Merrill, Esq. 7777 Glades Road, #400 Boca Raton, FL 33434 Tel: (561) 477-7800 E-mail: dlmerrill@sbwlawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flsb10-43407.pdf The petition was signed by Robert Littman, manager. MERUELO MADDUX: Opposes Equityholders' Plea to Delay Voting ----------------------------------------------------------- Meruelo Maddux Properties Inc., et al., ask the U.S. Bankruptcy Court for the Central District of California to deny the motion filed by the Official Committee of Equity Holders to reconsider the Court oral ruling approving the amended Disclosure Statement explaining the Debtors' Plan of Reorganization. As reported in the Troubled Company Reporter on October 26, 2010. The Equity Committee requested that the Court enter an order not later than November 15, which is five business days before the November 22 voting deadline on the Debtors' plan, (i) striking the Voting Condition from the Debtors' Disclosure Statement and the Debtors' Plan; and (ii) amending the Court's Disclosure Statement Approval Order only to the extent necessary to grant the relief. The members of the Equity Committee said they needed a reasonable opportunity to consider the competing plans without the Voting Condition because the Debtors' Disclosure Statement describes a non-confirmable plan of reorganization with respect to the Voting Condition. The Debtors explain that the Court already rejected the exact arguments made by the OEC in the motion and the factual premise upon which the OEC objects is still flawed. Accordingly, the Court must - again - overrule the OEC's objection by denying the motion. At the October 6 hearing on approval of their disclosure statement, the OEC's attorney objected on grounds that certain corporate governance provisions contained in the Plan and Disclosure Statement were improper. The Court overruled the OEC's objection and ruled that the objections made by the OEC to the Plan would be dealt with at confirmation. The Debtors also stressed that: -- there is nothing in the Plan that compels OEC members to vote in favor of the Plan or state a preference in favor of the Plan. The OEC members are free to vote as they wish, and even the OEC does not dispute that committee members are free to cast their votes as individuals, not committee members; -- the OEC's allegation that the Debtors included the so-called Voting Condition in response to the OECs objection to the Debtors' proposed solicitation letter is speculative and false; and -- the OEC's claim that the Plan violates the Code also lacks merit, and even the OEC devotes only a few sentences to that assertion. The Debtors add that the OEC provided no basis for reconsideration of the Court's order approving the Disclosure Statement and simply wants to waste time relitigating arguments already rejected by the Court. The Debtors propose a hearing on November 10 at 9:30 a.m., to consider their objection to the OEC's motion to reconsider the Court's ruling. Three Competing Plans Three parties have filed competing plans for Meruelo Maddux: (1) The Company. -- The plan provides for the payment in full of all claims over time with interest. The secured claims will be paid interest only over the term of the Plan and the principal balance will be paid either through the sale of the property securing the claim or the refinance of the secured debt. PI shareholders will retain their shares in MMPI. General unsecured creditors will be paid within 30 days after the effective date with interest from the Petition Date at 5% per annum. Holders of unsecured claims will be paid in the full amount of their claims over 5 years from the effective date. (2) Lenders Legendary Investors Group No. 1 LLC and East West Bank. -- The plan's foundation is an $80 million recapitalization via a $5 million cash infusion by Legendary, conversion of about $65 million of debt to equity and a $10 million rights offering to holders of Meruelo Maddux existing common stock. East West will receive 70% to 80% of the stock of the reorganized company. Holders of unsecured claims will receive a cash payment equal to 100% of the amount of their allowed claims on the effective date, plus simple interest at 5% per annum for the period from the petition date through the date each allowed claim is paid. Interest will be at the Federal Judgment Rate if the creditors vote to reject the plan. Holders of the existing stock will receive 20% of the stock in the reorganized company. (3) Existing shareholders Charlestown Capital Advisors LLC and Hartland Asset Management Corp. -- Under the plan, MMPI will receive a $31 million cash investment from Charleston and Hartland-led investors and from a rights offering made available to existing MMPI shareholders. Non-insider general unsecured creditors will be paid in full with interest as soon as the plan becomes effective. Holders of secured claims will receive monthly interest payments at 5.25% for four years with full payment on the principal balance four years after the effective date. Reorganized MMPI will issue to existing holders of MMPI interests, if they elect to receive stock instead of cash, will receive up to 26% of the total stock of the reorganized company. Stockholders can also purchase up to 19% of the stock in an $8 million rights offering. Judge Kathleen Thompson of the U.S. Bankruptcy Court for the Central District of California in October approved competing reorganization plans from Meruelo equity holders Charlestown Capital Advisors LLC and Hartland. Judge Thompson approved the disclosure statement explaining the Chapter 11 plan proposed by management in early August. The Creditors Committee is recommending that creditors turn down the management plan. The Committee supports the lenders' plan. The Committee noted that the lenders' plan will pay creditors in full with interest shortly after plan confirmation while the company plan would pay creditors in full over five years. The Company has said that East West is taking a predatory action by converting real estate debt into a controlling interest in a company. East West also appears to be proposing it use TARP money obtained by the federal government as a part of its effort to complete its hostile takeover of Meruelo Maddux. 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 Debtors' financial condition as of December 31, 2008, showed $681,769,000 in assets and $342,022,000 of debts. MOOG INC: Moody's Changes Outlook to Stable, Affirms 'Ba2' Rating ----------------------------------------------------------------- Moody's Investors Service has changed the rating outlook of Moog, Inc., to stable from negative and affirmed all existing ratings, including the corporate family rating of Ba2. The outlook change reflects expectation of a favorable operating trend that will bring credit metrics in line with the Ba2 rating. Firming commercial aircraft build and industrial production levels should sustain positive organic growth and free cash of, at least, $60 million annually. Moody's believe that Moog's diversification and growth strategy can be sustained while keeping a moderate financial profile. Moody's expect EBITA to average assets between 8% to 10% with debt to EBITDA below 4.0x (last twelve months ended July 3, 2010, 8% and 3.9x, respectively, Moody's adjusted basis). The outlook does not assume FY2009's more aggressive financial policy, whereby acquisition spend drove the return/leverage balance below the Ba2 bandwidth. The stable outlook also incorporates the expectation that Moog will maintain good liquidity. As operating performance improved during FY2010, Moog pulled back on acquisitions, boosting revolver repayment. With lower revolver debt and better performance, greater covenant compliance headroom followed; healthy headroom should continue. The Ba2 corporate family rating reflects competitive products, good margins and moderate financial policy. Presence on a number of commercial and defense aircraft platforms provides base earnings while Moog's other segments mature and support higher returns. The good liquidity profile provides some offset to acquisition focus and a still-soft U.S. economy. Ratings affirmed: -- Corporate family and probability of default Ba2 -- $200 million 6.25% senior subordinated notes due 2015, Ba3 LGD 5, 80% -- $200 million 7.25% senior subordinated notes due 2018, Ba3 LGD 5, 80% Moody's last rating announcement on Moog occurred April 16, 2009, when the rating outlook was changed to negative from stable and the Ba2 corporate family rating was affirmed. Moog, Inc., headquartered in East Aurora, NY, is a designer and manufacturer of high performance precision motion control products and systems for aerospace and industrial markets. The company operates within five segments: Aircraft Controls, Space and Defense Controls, Industrial Systems, Components, and Medical Devices. Moog had last twelve months ended July 3, 2010 revenues of about $2.0 billion. NON-INVASIVE MONITORING: Morrison Brown Raises Going Concern ------------------------------------------------------------ Non-Invasive Monitoring Systems, Inc., filed on October 29, 2010, its annual report on Form 10-K for the fiscal year ended July 31, 2010. Morrison, Brown Argiz & Farra, LLP, in Miami, Florida, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has experienced recurring net losses, cash outflows from operating activities and has an accumulated deficit and substantial purchase commitments. Further, the independent auditors noted that the Company terminated its agreement with its supplier of products. The supplier has demanded the Company to purchase inventory at levels sufficient to fulfill the minimum three-year purchase obligation under the agreement. The Company is currently unable to fund such a purchase and is attempting to resolve the issue. The Company also has net receivables of approximately $200,000 from the supplier, and tooling and equipment with a net book value of approximately $283,000 is in the possession of the supplier in Asia. The ultimate realization of the assets is dependent on the Company's ability to resolve the issue with the supplier. The loss of the business relationship with the supplier could also adversely impact the Company's business operations. The Company reported a net loss of $1.6 million on $617,000 of revenues for fiscal 2010, compared to a net loss of $1.8 million on $546,000 of revenue for fiscal 2009. At July 31, 2010, the Company's balance sheet showed $1.6 million in total assets, $925,000, and stockholders' equity of $706,000. A full-text copy of the Form 10-K is available for free at: http://researcharchives.com/t/s?6d3e About Non-Invasive Monitoring Based in Miami, Florida, Non-Invasive Monitoring Systems Inc. (OTC BB: NIMU) -- http://www.nims-inc.com/-- is primarily engaged in the research, development, manufacturing and marketing of a line of motorized, non-invasive, whole body, periodic acceleration platforms, which are intended as aids to improve circulation and joint mobility, relieve minor aches and pains, relieve morning stiffness, relieve troubled sleep and as mechanical feedback devices for slow rhythmic breathing exercise for stress management. NORTH COAST: A.M. Best Assigns 'C+' Financial Strength Rating ------------------------------------------------------------- A.M. Best Co. has placed under review with positive implications the financial strength rating (FSR) of C+ (Marginal) and issuer credit rating (ICR) of "b-" of North Coast Life Insurance Company (North Coast) (Spokane, WA). The rating actions are based on the October 19, 2010 announcement by North Coast of its intention to be acquired by Government Personnel Mutual Life Insurance Company (GPM). Under the proposed agreement, North Coast would continue operations as a subsidiary of GPM. Following regulatory approval, the change in ownership is expected to take effect by December 31, 2010, but could extend into the first quarter of 2011. A.M. Best notes that North Coast and GPM have previously been strategic partners, as they have had a reinsurance agreement in place since 2008. The positive implications reflect the potential incorporation of North Coast policyholders into a stronger organization. The FSR of A- (Excellent) and ICR of "a-" of GPM are unchanged by this transaction. NPC INTERNATIONAL: Moody's Affirms 'B2' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service affirmed all the ratings of NPC International, Inc., including the company's B2 Corporate Family and Probability of Default ratings, Ba3 senior secured rating, Caa1 senior subordinated note rating, and SGL-3 Speculative Grade Liquidity rating. Moody's also changed the outlook to stable from negative. "The change in outlook to stable from negative reflects Moody's view that NPC's debt protection metrics should remain within a range appropriate for a B2 rating despite weak consumer spending as the company focuses on stabilizing same store sales and reducing debt," stated Bill Fahy, Moody's Senior Analyst. Over the last couple of quarters same store sales turned significantly positive, after several quarters of negative same store sales, as the company materially reduced prices on all pizzas in an effort to provide value to consumers. "Although this negatively impacted margins, management recently refined its pricing strategy which should help to stabilize margins," stated Fahy. Affirmation of the B2 Corporate Family Rating reflects the benefits NPC derives from its meaningful scale within the Pizza Hut franchise system, somewhat flexible cost structure, and adequate liquidity. The ratings are constrained by its relatively high leverage and modest coverage, as well as its limited product offering and concentrated day part versus peers, and limited geographic diversity. Factors that could result in an upgrade include a sustained improvement in operating performance and debt protection metrics driven by profitable same store sales growth. An upgrade would also require the Pizza Hut organization (owned by YUM! Brands International) to develop and implement a successful long-term marketing strategy for the Pizza Hut system. Quantitatively, an upgrade would require debt-to-EBITDA of about 4.5 times and EBITA interest coverage approaching 1.75 times. A higher rating would also require the company maintaining adequate liquidity and refinancing its revolving credit facility well in advance of its 2012 expiration. Factors that could cause a downgrade include a deterioration in operating earnings or debt protection metrics as a result of an inability to drive profitable same store sales on a sustained basis. Specifically, a downgrade could occur if debt-to-EBITDA exceeded 6.0 times or EBITA coverage of interest fell below 1.25 times. A downgrade is also possible in the event NPC was unable to maintain adequate liquidity or refinance its revolving credit facility well before its expiration. NPC International, Inc., is the largest Pizza Hut franchisee operating 1,143 units in twenty-eight states with concentrations in the Midwest, Southern and Southeastern regions of the United States. Headquartered in Overland Park, Kansas, total revenues are around $940 million. NUTRACEA: Plan of Reorganization Approved by Bankruptcy Court ------------------------------------------------------------- NutraCea disclosed on October 27, 2010 the U.S. Bankruptcy Court for the District of Arizona entered an order confirming the company's First Amended Plan of Reorganization. Creditors voted overwhelmingly in favor of the Plan. W. John Short, Chairman and CEO, commented, "The Bankruptcy Court's approval of our Plan of Reorganization is an important milestone for our company and further positions NutraCea for emergence from Chapter 11 before year end. I am extremely proud of the job done by our employees, who contributed to making this restructuring a success and are the foundation for the continued growth our company. I also want to thank our Board of Directors and professional advisors for their support and counsel during this process. Finally, I am most appreciative for the support and confidence that our secured and unsecured creditors demonstrated by voting overwhelmingly in favor of the Plan." Mr. Short, continued, "Since our filing for voluntary Chapter 11 protection nearly a year ago, we have worked hard to take best advantage of the court supervised protection provided under chapter 11 of the US Bankruptcy Code to restructure NutraCea so we can emerge a stronger, more viable company. Since mid-2009 we have divested non-core businesses including a wheat milling joint venture, a nutraceuticals distribution business, our equine feed brands and the infant cereal business. In addition, we have reduced payroll and operating expenses by approximately $4.6 million annually and strengthened our management team with the addition of Dale Belt as EVP and CFO, Colin Garner as SVP of Sales and the promotion of Leo Gingras to President." Mr. Short concluded, "We are rebuilding NutraCea by focusing on our core businesses of stabilized rice bran (SRB), rice bran oil (RBO) /defatted rice bran (DRB) and rice bran-related nutraceutical and pharmaceutical applications. We are confident that this focus will provide us with a solid foundation to grow our company for the benefit of our shareholders, employees, customers, suppliers, creditors and other stakeholders. " A summary of the material terms of the Plan is listed in the 8-K filed with the Securities and Exchange Commission today. About NutraCea Phoenix, Arizona-based NutraCea is a world leader in production and utilization of stabilized rice bran. NutraCea holds many patents for stabilized rice bran production technology and proprietary products derived from SRB. NutraCea's proprietary technology enables the creation of food and nutrition products to be unlocked from rice bran, normally a waste by-product of standard rice processing. Nutracea filed for Chapter 11 bankruptcy protection November 10, 2009 (Bankr. D. Ariz. Case No. 09-28817). S. Cary Forrester, Esq., at Forrester & Worth, PLLC, assists the Company in its restructuring effort. The Company estimated assets of $50 million to $100 million and debts of $10 million to $50 million in its Chapter 11 petition. NY TIMES: Moody's Assigns 'B1' Rating to $200 Mil. Senior Notes --------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to The New York Times Company's proposed $200 million senior unsecured notes due 2016 and changed the rating outlook to positive from stable. Moody's also affirmed NY Times' B1 Corporate Family Rating and B1 Probability of Default Rating, and upgraded the speculative-grade liquidity rating to SGL-2 from SGL-3. NY Times plans to utilize the net proceeds from the proposed notes for general corporate purposes, including repayment of outstanding indebtedness and contributions to the company's defined benefit pension plans. Moody's believes the company will utilize part of the note proceeds along with cash to fund a call of the $250 million 14.053% notes issued to affiliates of Carlos Slim Helu (Slim notes). The Slim notes are callable in January 2012 and the company has publicly indicated its intent to retire the notes to reduce interest expense. Loss given default point estimates were updated to reflect the company's updated debt structure. Assignments: Issuer: New York Times Company (The) -- Senior Unsecured Regular Bond/Debenture due 2016, Assigned B1, LGD4 - 56% LGD Changes: Issuer: New York Times Company (The) -- Senior Unsecured Regular Bond/Debentures, Changed to LGD4 - 56% from LGD4 - 57% (no change to B1 rating) Upgrades: Issuer: New York Times Company (The) -- Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3 Outlook Actions: Issuer: New York Times Company (The) -- Outlook, Changed To Positive From Stable Ratings Rationale The change in the rating outlook to positive reflects Moody's expectation that NY Times will generate meaningful free cash flow in a $130-150 million range in 2011 and 2012 and that the company will continue to utilize that cash flow to reduce debt and leverage, despite anticipated pressure on earnings. Moody's believes the conservative leverage targeted by the company will continue to guide its use of free cash flow. Gross balance sheet debt and cash interest expense will increase in the near term as a result of the proposed 2016 note offering, but should drop below current levels once the Slim notes are called. Moody's also expects NY Times will retire the $75 million MTN's due in September 2012 with cash and continue to make contributions to its pension plans, which will be considered debt reduction. Moody's remains cautious about the newspaper advertising environment in 2011 and does not anticipate a resumption of revenue growth in the near term. Moody's nevertheless anticipates NY Times will continue to manage its costs prudently and take steps such as the rollout of the previously announced pay model for The New York Times newspaper to mitigate declines in print advertising. Moody's believes the strong position of the Times as the paper of record in national news will prevent significant cannibalization of online readership and advertising when the pay model is introduced. The pace of de-leveraging will slow as Moody's does not expect the 75% jump in EBITDA in 2010's first nine months (driven by cost reductions) will be repeated, but continued declines in debt (including the underfunded pension, which Moody's views as debt) and leverage could position the company for an upgrade. NY Times' B1 CFR continues to reflect its significant global news and information infrastructure that supports high quality content, which appeals to a large and affluent customer base that is attractive to advertisers. The company derives the majority of its revenue from newspapers and its revenue is under significant long-term pressure due to heightened competition from online and mobile news and information content providers and also vulnerable to cyclical downturns. The transition to a more digital-oriented revenue base will likely be disruptive as circulation and advertising rates are expected to be lower than existing print rates. Debt-to-EBITDA leverage of 4.3x (LTM 9/26/10 incorporating Moody's standard adjustments) is high, particularly for an industry that Moody's believes should be conservatively levered given the cyclicality and long-term competitive challenges. However, Moody's anticipates leverage will decline to a level at or below 4x in 2012 factoring in anticipated debt reduction and EBITDA declines in the 7-11% range in 2011 and 2012. The new notes will be senior unsecured and unguaranteed obligations of NY Times and will rank equally with its existing and future senior unsecured debt. The B1 rating and LGD4-56% assessment on the notes reflect the structural subordination to non debt operating company liabilities such as trade payables, pensions and leases. Similar to the Slim notes, the proposed 2016 notes have a more restrictive covenant package than the 5% notes due 2015 including a change of control put and limitations on debt incurrence and restricted payments. The limitation on liens covenant is broader than the existing notes in that it covers intangibles as well as PP&E, but the basket size is similar (20% of shareholders equity or approximately $130 milion as of 9/26/10). If the $400 million revolver due June 2011 is refinanced with a guaranteed or secured facility (the limitation on liens in the note indenture does not cover working capital), the rating on the unsecured and unguaranteed debt (including the proposed notes) could be notched below the CFR depending on the size of the replacement facility. The upgrade of the speculative-grade liquidity rating to SGL-2 is driven by NY Times' strong pro forma cash balance ($329 million as of 9/26/10 pro forma for the proposed bond offering) and projected free cash flow relative to cash needs. NY Times has no debt maturities over the next 12-15 months and pension contributions are manageable within projected cash generation. The next maturity is the $75 million MTNs due September 2012 (as noted, Moody's expects NY Times will call the Slim notes in January 2012). The expiration of the $400 million revolver in June 2011 is a liquidity weakness and would result in a need to cash collateralize the $62 million of letters of credit if a replacement facility is not established. Debt-to-EBITDA leverage above 5.5x or free cash-to-debt below 5% due to revenue weakness, an inability to translate cost savings into EBITDA improvement, acquisitions, or cash distributions to shareholders could lead to a downgrade. Deterioration in liquidity including a smaller cushion to meet debt maturities and pension contributions could also result in a downgrade. An easing of revenue pressure and debt reduction that leads to debt-to-EBITDA sustained below 4x and free cash flow sustained above 7.5% of debt could lead to an upgrade. The company would also need to maintain a good liquidity position including sufficient cash, projected free cash flow and unused revolver capacity to fund maturities and required pension contributions to be considered for an upgrade. The last rating action was on March 10, 2010, when Moody's changed NY Times' rating outlook to stable from negative. The New York Times Company is a New York based media company with operations in newspaper publishing and information services. The company operates The New York Times, the International Herald Tribune, The Boston Globe, 15 other daily newspapers, and more than 50 Web sites including NYTimes.com and About.com. Revenue for the LTM 9/26/10 period was approximately $2.4 billion. NY TIMES: S&P Rates $200M Rule 144A Senior Notes at 'B+' -------------------------------------------------------- Standard and Poor's rated New York Times Co.'s $200M Rule 144A Senior Notes at 'B+' (Recovery Rating: 4). U.S. newspaper publisher The New York Times Co. has proposed the issuance of $200 million privately placed Rule 144A senior notes due 2016. S&P expects the company to use proceeds to refinance higher-cost debt. S&P is rating the notes 'B+' with a recovery rating of '4' and affirming S&P's 'B+' rating on the company. The stable rating outlook reflects S&P's expectation that The New York Times will be able to maintain credit measures at current levels, despite the secular decline in print advertising revenues. OMNICITY CORP: Files Amendment No. 2 to Fiscal 2010 Q1 Report ------------------------------------------------------------- Omnicity Corp. filed on November 1, 2010, Amendment No. 2 to its quarterly report for the fiscal period ended October 31, 2009, as originally filed on December 21, 2009, and amended (Amendment No. 1) on September 29, 2010, in response to certain comments from the U.S. Securities and Exchange Commission to the Company about the quarterly report. An error in the recording of a stock subscription in April 2009 resulted in a net increase to stock subscriptions of $4,594 and an increase to deficit of $4,594 for that period. There is no effect of this error on previously issued statements of operations. The Company reported a net loss of $644,136 on $617,000 of revenue for the three months ended October 31, 2009, compared to a net loss of $403,257 on $327,733 of revenue for the same period ended October 31, 2008. The Company's balance sheet (restated) at October 31, 2009, showed $3.9 million in total assets, $4.4 million in total liabilities, and a stockholders' deficit of $510,101. A full-text copy of the Form 10-Q/A (Amendment No. 2) is available for free at http://researcharchives.com/t/s?6d40 About Omnicity Corp. Based in Rushville, Indiana, Omnicity Corp. (OTC BB: OMCY) -- http://www.omnicitycorp.com/-- provides broadband access via wireless and fiber infrastructure to business, government and residential customers in rural markets in the Midwest. * * * Weaver & Martin LLC, in Kansas City, Mo., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for fiscal 2009. The independent auditors noted that Company has suffered recurring losses and had negative cash flows from operations. OMNICITY CORP: Filing of July 31 Annual Report to be Delayed ------------------------------------------------------------ Omnicity Corp. discloses that its annual report on Form 10-K for the fiscal year ended July 31, 2010, cannot be filed within the prescribed time period because the Company has a limited accounting staff and the financial statements were not completed in sufficient time to solicit and obtain the necessary audit of the annual report. The Company does not anticipate that any significant change in results of operations will be reflected by the earnings statement from the last fiscal year. About Omnicity Corp. Based in Rushville, Indiana, Omnicity Corp. (OTC BB: OMCY) -- http://www.omnicitycorp.com/-- provides broadband access via wireless and fiber infrastructure to business, government and residential customers in rural markets in the Midwest. The Company's balance sheet as of April 30, 2010, showed $5.7 million in total assets, $6.4 million in total liabilities, and a stockholders deficit of $677,494. Weaver & Martin LLC, in Kansas City, Mo., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended July 31, 2009. The independent auditors noted that Company has suffered recurring losses and had negative cash flows from operations. OTC HOLDINGS: To Present Plan for Confirmation on Dec. 14 --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Oriental Trading Co. scheduled a Dec. 12 confirmation hearing for approval of the Chapter 11 plan after it obtained approval of the explanatory disclosure statement. The proposed plan offers new stock plus cash or a new $200 million second-lien note to senior lenders owed $403 million. Second lien lenders would receive warrants for 2.5% of the stock with a strike price based on an enterprise value of $427.5 million. Unsecured creditors with $6.8 million in claims would receive $1.1 million from first-lien lenders, pursuant to a settlement with the creditors committee. The disclosure statement contains no estimate for the percentage recovery by senior or junior lenders. The unsecured creditors' committee and the first-lien lenders support the plan. Mr. Rochelle relates that confirmation of the plan may be opposed by second-lien lenders. About OTC Holdings Omaha, Nebraska-based OTC Holdings Corporation filed for Chapter 11 protection on August 25, 2010 (Bankr. D. Del. Case No. 10-12636). Affiliates OTC Investors Corporation (Bankr. D. Del. Case No. 10-12637), Oriental Trading Company, Inc. (Bankr. D. Del. Case No. 10-12638), Fun Express, Inc. (Bankr. D. Del. Case No. 10-12639), and Oriental Trading Marketing, Inc. (Bankr. D. Del. Case No. 10-12640), filed separate Chapter 11 petitions on August 25, 2010. The Debtors disclosed $463 million in total assets and $757 million in total liabilities as of the Petition Date. Richard Hahn, Esq., My Chi To, Esq., Jae-Sun Chung, Esq., Huyue Angela Zhang, Esq., and Jessica Katz, Esq., at Debevoise & Plimpton LLP, assist the Debtors in their restructuring efforts. Joel A. Waite, Esq., and Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' local counsel. Jefferies & Company, Inc., is the Debtors' financial advisor. Protiviti, Inc., is the Debtors' restructuring consultant. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The Official Committee of Unsecured Creditors' Delaware counsel is Ashby & Geddes, P.A. PACIFICHEALTH LABORATORIES: Posts $87,400 Net Loss in Q3 2010 ------------------------------------------------------------- PacificHealth Laboratories, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $87,371 on $2.0 million of revenue for the three months ended September 30, 2010, compared to a net loss of $174,095 on $2.4 million of revenue for the same period last year. The Company's balance sheet as of September 30, 2010, showed $2.3 million in total assets, $1.2 million in total liabilities, and stockholders' equity of $1.1 million. The Company has incurred significant operating losses and has an accumulated deficit of $19.1 million as of September 30, 2010. At September 30, 2010, the Company's current assets exceeded its current liabilities by approximately $1.0 million with a ratio of current assets to current liabilities of approximately 1.8 to 1. As reported in the Troubled Company Reporter on April 7, 2010, Weiser LLP, in Edison, N.J., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted of the Company's recurring operating losses and negative cash flows from operations. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6d3c About PacificHealth Laboratories Matawan, N.J.-based PacificHealth Laboratories, Inc., develops protein-based nutritional products that activate biochemical pathways to enhance muscle endurance and additionally the specific peptides involved in appetite regulation. POINT BLANK: Class-Action Plaintiffs Protest Bid's to Reject Deal ----------------------------------------------------------------- The lead plaintiffs in a securities class-action lawsuit against a predecessor of Point Blank Solutions Inc. are accusing the body- armor maker of attempting to "turn back the hands of time" and wrongfully rejecting a deal they struck with the company more than four years ago, Dow Jones' DBR Small Cap reports. About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection on April 14, 2010 (Bankr. D. Del. Case No. 10-11255). Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. T. Scott Avila of CRG Partners Group LLC is the restructuring officer. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. The Equity Committee has tapped Morrison Cohen LLP, and The Bayard, P.A., as counsel. Robert M. Hirsh, Esq., and Heike M. Vogel, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at Messana Rosner & Stern LLP, serve as co- counsel. RASER TECHNOLOGIES: Makes $2.2MM Semi-Annual Interest Payment ------------------------------------------------------------- Raser Technologies, Inc., disclosed in a regulatory filing that it used recently obtained funds to satisfy its $2.20 million semi- annual interest payment obligation to holders of its 8.00% Convertible Senior Notes due 2013, which was required to be paid by November 1, 2010, to avoid a payment default on the Convertible Notes. The Troubled Company Reporter said on October 6, 2010, that Raser Technologies did not make the semi-annual interest payment, originally due October 1, 2010. Pursuant to a March 26, 2008 Indenture Agreement, the Company had until October 31, to make the interest payment before the noteholders could accelerate the maturity date or take any action to enforce the Notes. The Company had said it intends to make the payment by October 31 or to seek from the noteholders a forbearance with regards to the interest payment and a modification of the Notes. On October 26, 2010, the Company entered into the First Amendment to Amendment, Consent and Forbearance Agreement with Thermo No. 1 BE-01, LLC, The Prudential Insurance Company of America, Zurich American Insurance Company and Deutsche Bank Trust Company Americas amending the Amendment, Consent and Forbearance Agreement entered between the parties on July 9, 2010, relating to the repayment of a substantial portion of the debt financing for the Thermo No. 1 geothermal power plant. Pursuant to the Amendment, the Company received an immediate release of $1.10 million from the Thermo No. 1 Plant escrow funds, the end of the forbearance period was changed from June 29, 2011, to February 1, 2011, and the Company's repayment obligation to the lenders, which is now due on or before February 1, 2011, was increased from $6 million to $6.25 million. In addition, pursuant to a Letter Agreement among the Company, Evergreen Clean Energy, LLC, and Raser Power Systems, LLC, dated October 27, 2010, Evergreen agreed to advance certain funds to the Company from time to time, including an initial advance of $1.15 million on October 28, 2010. As additional consideration for the Letter Agreement, the Company and Raser Power agreed not to solicit additional potential purchasers for the purchase of any interests in Thermo on or before November 30, 2010, and agreed to pay a break-up fee in certain circumstances. The Company's obligation to repay the initial advance of $1.15 million was made pursuant to a Secured Promissory Note, dated October 28, 2010, issued by the Company to Evergreen. The terms of the Secured Promissory Note allow for the Company to receive advances from Evergreen in one or more loans for up to $2.50 million. Principal and accrued interest on all Loans will be payable to Evergreen on the earlier of June 30, 2011, or the date on which the Company closes a transaction for the sale of its Thermo No. 1 Plant. The Loans bear interest at the rate of 12% per annum or, with respect to any amounts not paid to Evergreen by the Maturity Date, at the rate of 18% per annum. The Company's obligations under the Secured Promissory Note are secured by a first priority security interest in, and lien on all of the Company's right, title, and interest in its Alvord prospect -- formerly the Borax Lake prospect -- located in Harney County, Oregon and certain transformer equipment, pursuant to the Deed of Trust and Security Agreement, dated October 28, 2010, executed by Raser Power for the benefit of Evergreen and the Security Agreement, dated as of October 28, 2010, between Raser Power and Evergreen. About Raser Technologies Provo, Utah-based Raser Technologies, Inc. (NYSE: RZ) -- http://www.rasertech.com/-- is an environmental energy technology company focused on geothermal power development and technology licensing. Raser's Power Systems segment develops clean, renewable geothermal electric power plants with one operating plant in southern Utah and eight active and early stage projects in four western United States: Utah, New Mexico, Nevada and Oregon, as well as a concession for 100,000 acres in Indonesia. Raser's Transportation and Industrial segment focuses on extended-range plug-in-hybrid vehicle solutions and using Raser's award-winning Symetron(TM) technology to improve the torque density and efficiency of the electric motors and drive systems used in electric and hybrid-electric vehicle powertrains and industrial applications. The Company's balance sheet as of June 30, 2010, showed $90.0 million in total assets, $130.6 million in total liabilities, and a stockholders' deficit of $40.6 million. * * * Hein & Associates LLP, in Denver, Colo., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses, has used significant cash for operating activities since inception, has significant purchase commitments in 2010 and has a lack of sufficient working capital. RASER TECHNOLOGIES: Trades Under OTCBB Today After NYSE Delisting ----------------------------------------------------------------- Raser Technologies, Inc., received two notices from the New York Stock Exchange that the Company fell below certain listing standards criteria outlined in the NYSE's Listed Company Manual. The first notice was received on April 27, 2010, and related to the Company's inability to maintain a minimum average closing price of $1.00 for a 30-day trading period under Section 802.01C of the NYSE's Listed Company Manual. Under the NYSE's rules, the Company had six months from the date of the April 27, 2010 notice to bring its average common share price back above $1.00. The second notice was received on July 30, 2010, and related to the Company's inability to maintain a total market capitalization of at least $50 million over a 30-day trading period and stockholders' equity of at least $50 million as outlined in Sections 801 and 802 of the NYSE's Listed Company Manual. Subsequent to receiving the two notices from the NYSE, the Company submitted a plan to the NYSE requesting additional time to cure the deficiencies and detailing the path the Company planned to follow to regain compliance with NYSE listing standards. After reviewing these materials, however, the NYSE decided to proceed with suspension of trading of the Company's common stock on the NYSE and informed the Company on October 26, 2010, of its intention to suspend trading of the Company's common stock prior to the market opening on November 3, 2010. The NYSE also notified the Company of its intention to file an application with the Securities and Exchange Commission to delist the Company's common stock from the NYSE, pending completion of applicable NYSE procedures, which includes the Company's right to appeal the NYSE's decision. The Company has taken steps to have its common stock quoted on the Over-the Counter Bulletin Board and expects its stock to be quoted on the OTCBB starting November 3, 2010. The Company will be assigned a new ticker symbol the day before it begins trading on the OTCBB. The OTCBB is a regulated quotation service that displays real-time quotes, last-sale prices, and volume information in over-the-counter equity securities. The Company's common stock was to continue trading on the NYSE through November 2, 2010. About Raser Technologies Provo, Utah-based Raser Technologies, Inc. (NYSE: RZ) -- http://www.rasertech.com/-- is an environmental energy technology company focused on geothermal power development and technology licensing. Raser's Power Systems segment develops clean, renewable geothermal electric power plants with one operating plant in southern Utah and eight active and early stage projects in four western United States: Utah, New Mexico, Nevada and Oregon, as well as a concession for 100,000 acres in Indonesia. Raser's Transportation and Industrial segment focuses on extended-range plug-in-hybrid vehicle solutions and using Raser's award-winning Symetron(TM) technology to improve the torque density and efficiency of the electric motors and drive systems used in electric and hybrid-electric vehicle powertrains and industrial applications. The Company's balance sheet as of June 30, 2010, showed $90.0 million in total assets, $130.6 million in total liabilities, and a stockholders' deficit of $40.6 million. * * * Hein & Associates LLP, in Denver, Colo., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses, has used significant cash for operating activities since inception, has significant purchase commitments in 2010 and has a lack of sufficient working capital. The Troubled Company Reporter said on October 6, 2010, that Raser Technologies did not make the $2.2 million semi-annual interest payment due October 1, 2010, on its 8% Convertible Senior Notes Due 2013. The Company satisfied the semi-annual interest payment obligation after receiving $1.10 million from the Thermo No. 1 plant escrow funds and $1.15 million from a loan with Evergreen Clean Energy, LLC, late in October 2010. REDCO DEVELOPMENT: Can Use Sterling Savings' Cash Collateral ------------------------------------------------------------ The Hon. Frank R. Alley of the U.S. Bankruptcy Court for the District of Oregon approved a stipulation authorizing Redco Development Co., LLC, to access cash securing its obligation to Sterling Savings Bank until the date of confirmation of Debtor's Plan of Reorganization. The Debtor is authorized to use cash collateral from the Miller Office Building at 14 N. Central, Medford, Oregon, to operate its business postpetition. As adequate protection for the use by Debtor of cash collateral, Sterling is granted a replacement security interest in and a lien upon all assets of the estate, including all rents and accounts. The security interest will have the same relative priority as the lien and security interest of Sterling had on the Petition Date. In particular, Sterling will be granted a first security position in not less than 75% of the cash available at any point in time in Debtor's debtor-in-possession account at Sterling. As additional adequate protection, the Debtor will pay monthly payments to Sterling concerning two Promissory Notes. The payment on Note 9001, which is due on the tenth day of each month, will be paid by the 10th day of each month. The payment on Note 7001, which is due on the 24th day of each month, will be paid by the 10th day of the following month. About Redco Development Co., LLC Medford, Oregon-based Redco Development Co., LLC, filed for Chapter 11 bankruptcy protection on August 3, 2010 (Bankr. D. Ore. Case No. 10-64783). James Ray Streinz, Esq., who has an office in Portland, Oregon, assists the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. REDCO DEVELOPMENT: U.S. Trustee Unable to Form Creditors Committee ------------------------------------------------------------------ The U.S. Trustee for Region 18 notified the U.S. Bankruptcy Court for the District of Oregon that he was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of Redco Development Co., LLC. The U.S. Trustee explained that he has not received a sufficient number of creditors willing to serve on a committee of unsecured creditors. Medford, Oregon-based Redco Development Co., LLC, filed for Chapter 11 bankruptcy protection on August 3, 2010 (Bankr. D. Ore. Case No. 10-64783). James Ray Streinz, Esq., who has an office in Portland, Oregon, assists the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. RICHARD MILSNER: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Joint Debtors: Richard Leland Milsner Donna Lou Milsner 302 Iron Horse Court Alamo, CA 94507 Bankruptcy Case No.: 10-72426 Chapter 11 Petition Date: October 28, 2010 Court: U.S. Bankruptcy Court Northern District of California (Oakland) Judge: Roger L. Efremsky Debtors' Counsel: David A. Arietta, Esq. LAW OFFICES OF DAVID A. ARIETTA 700 Ygnacio Valley Road, #150 Walnut Creek, CA 94596 Tel: (925)472-8000 E-mail: david@ariettalaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 The list of unsecured creditors filed together with its petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Scott Valley Bank Rental Property $1,155,000 P.O. Box 69 Located at 210 Yreka, CA 96097 James Avenue, So. Lake Tahoe, CA 96150 ROOFING SUPPLY: Moody's Assigns 'B2' Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service assigned first-time public rating of B2 Corporate Family Rating and B2 Probability of Default Rating to Roofing Supply Group, LLC. In a related action Moody's assigned a B2 rating to the proposed Senior Secured Notes due 2017. The rating outlook is stable. These ratings/assessments were affected by this action: -- Corporate Family Rating assigned B2; -- Probability of Default assigned B2; and, -- $225 million Senior Secured Notes due 2017 rated B2 (LGD4, 56%). Ratings Rationale RSG's B2 Corporate Family Rating is constrained by the company's negligible tangible net worth, modest interest coverage, financial leverage, and its limited scale and line of business diversity. The rating is supported by the company's resilient performance during the economic and housing downturn, its strong position in roofing supply distribution, and acceptable near term liquidity profile. In addition to cyclical factors, demand for roofing is impacted by levels of severe storm activity in served regions. The stable outlook reflects Moody's expectation that the company will continue to enjoy relatively stable operating profits, and will maintain leverage appropriate for its rating category. Availability under RSG's asset-based revolving credit facility and the absence of near-term maturities or other liquidity constraints support the stable outlook as well. The B2 rating on the proposed $225 million senior secured notes due 2017 is the same rating as the corporate family rating. The notes will have a first lien on the company's long-term assets and a second lien on the working capital assets that secure the revolving credit facility. Moody's applies a collateral deficiency on the notes since the quality and amount of pledged assets in a recovery scenario would be nominal relative to the size of the notes issuance. The notes proceeds along with a modest amount of corporate cash will be used to redeem existing debt and pay related fees and expenses. An upgrade could result from RSG's consistently evidencing EBITA margins above 7.5% and EBIT-to-interest expense trending towards 2.5 times (all ratios adjusted per Moody's methodology). Factors which might pressure the ratings include erosion in the company's financial performance, debt financed acquisitions or a deteriorating liquidity profile, resulting in debt-to-EBITDA sustained above 6.0 times or EBIT-to-interest expense remaining below times for an extended period of time (all ratios adjusted per Moody's methodology). Roofing Supply Group, LLC, headquartered in Dallas, TX, is the fourth largest wholesale distributor by revenues of roofing supplies and related building materials in the United States. RSG provides one-step distribution services directly from the roofing product manufacturer to roofing contractors, home builders, retailers and other end users. ROYAL HOSPITALITY: Can Hire Hodgson Russ as Bankruptcy Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of New York authorized Royal Hospitality LLC to employ Hodgson Russ LLP as counsel. Hodgson Russ is expected to represent the Debtor in the Chapter 11 proceedings. To the best of the Debtor's knowledge, Hodgson Russ is a ?disinterested person? as that term is defined in Section 101(14) of the Bankruptcy Code. Royal Hospitality LLC, dba Comfort Suites, has been operating the Comfort Suites in Lake George, New York since May 2007. It filed for Chapter 11 protection on August 19, 2010 (Bankr. N.D.N.Y. Case No. 10-13090). The Debtor disclosed $13,432,001 in assets and $11,154,770 in liabilities as of the Petition Date. RURAL/METRO OPERATING: Moody's Puts 'B2' Rating on $200 Mil. Notes ------------------------------------------------------------------ Moody's Investors Service assigned a (P) B2 provisional rating to the $200 million unsecured notes of Rural/Metro Operating Company, LLC, a wholly-owned subsidiary of Rural/Metro Corporation. Concurrently, Moody's affirmed all of the existing ratings of Rural/Metro including the company's B1 corporate family and probability of default ratings. The rating outlook is stable. These rating actions were taken: Rural/Metro Corporation: -- Corporate family rating, affirmed at B1; -- Probability of default rating, affirmed at B1; -- 12.75% senior discount notes due 2016, affirmed at B3 (LGD5, 88%). Rural/Metro Operating Company, LLC: -- $200 million senior unsecured notes, due 2018, assigned (P) B2 (LGD5, 73%); -- $100 million senior secured revolving credit facility, due 2015, affirmed at (P) Ba1 (LGD2, 16%); -- $75 million senior secured term loan, due 2016, affirmed at (P) Ba1 (LGD2, 16%); -- $40 million senior secured revolving credit facility, due 2013, affirmed at Ba3 (LGD3, 30%); -- $180 million ($175 million outstanding) senior secured term loan, due 2014, affirmed at Ba3 (LGD3, 30%). Ratings Rationale LGD point estimates are subject to change and all ratings are subject to review of final documentation. The proceeds from the $200 million unsecured notes along with the $175 million proposed senior secured credit facilities (rated by Moody's on October 20, 2010) are being used to refinance the company's existing debt. If the refinancing transactions close as proposed, Moody's will withdraw the ratings on the existing senior secured credit facility and on the 12.75% Senior Discount Notes, assuming substantially all the notes are tendered. Moody's will also remove the provisional rating indicators "(P)" from the $175 million senior secured credit facilities, rated (P) Ba1, and $200 million senior unsecured notes, rated (P) B2, and replace the ratings with Ba1 and B2, respectively. Rural Metro's B1 corporate family rating reflects the company's good free cash flow generation, ability to manage uncompensated care expense and national presence in a highly fragmented industry. However, the rating also considers the company's modest size and increased pressure on rates and/or subsidies from states and municipalities due to budgetary pressures. The B1 rating currently does not take into consideration any meaningful acquisition activity. The outlook could be changed to positive or ratings upgraded if the company's adjusted free cash flow to debt increases to above 10% on a sustainable basis and debt to EBITDA declines below 3.0 times on a sustainable basis. The outlook could be changed to negative if the company adopts a more aggressive development or acquisition strategy, notably if that results in additional debt leverage. The ratings could be downgraded if adjusted debt to EBITDA is expected to approach 5.0 times. Rural Metro provides emergency and non-emergency medical transportation, fire protection, airport fire and rescue and home healthcare services in 20 states and approximately 440 communities within the United States. The services are provided under contract with government entities, hospitals, healthcare facilities and other healthcare organizations. Net revenue for the twelve months ended June 30, 2010 was approximately $531 million. SONRISA PROPERTIES: Hearing for Compass Plan Outline on Nov. 16 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas will convene a hearing on November 16, 2010, at 10:30 a.m., to consider adequacy of the Disclosure Statement explaining the Plan of Liquidation for Sonrisa Properties, Ltd., as proposed by Compass Bank. Objections, if any, are due November 9. Compass Bank will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. The Debtor owns approximately 4 acres of unimproved real property in League City, Galveston County, Texas. According to the Disclosure Statement, Compass Bank's Plan provides for the sale of the property via an auction to take place within 120 days of the effective date of the Plan. The auction will be conducted by Tranzon, a national auction company handling real estate and business assets. The property will be sold at an auction via one or more cash sales or a credit bid sale. The net proceeds will be distributed by the disbursing agent in accordance with the Plan. The disbursing agent will also liquidate any remaining assets and distribute other liquidation proceeds and pre-confirmation remaining sale proceeds. A full-text copy of Compass Bank Disclosure Statement is available for free at: http://bankrupt.com/misc/SonrisaProperties_CompassDS.pdf The Debtor's Plan As reported in the Troubled Company Reporter on April 21, the Plan proposes (1) to obtain financing from a third party ($4,750,000 from Briar Capital Group) in order to restructure the Compass Bank indebtedness over a five year term; (2) subordinate the first lien position of Compass by granting Briar Capital Group a first lien position in the collateral; and (3) a payout to holders of undisputed and allowed unsecured claims after payment in full to Briar Capital Group and Compass. Pursuant to the Plan, Compass will partially release its lien as properties are sold and receive $1.30 per square foot for any property for which a partial release is requested. 100% of net proceeds remaining from any sale will be first applied to the Briar Note until the Briar Note is paid in full. Randal M. Hall, the president of the Debtor's general partner, will disburse all plan funds. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/SonrisaProperties_DS.pdf Compass Bank is represented by: Bruce J. Ruzinsky, Esq. JACKSON WALKE L.L.P 1401 McKinney, Suite 1900 Houston, TX 77010 Tel: (713) 752-4204 Fax: (713) 481-6262 E-mail: bruzinsky@jw.com About Sonrisa Properties League City, Texas-based Sonrisa Properties, Ltd., filed for Chapter 11 bankruptcy protection on January 4, 2010 (Bankr. S.D. Texas Case No. 10-80012). Karen R. Emmott, Esq., who has an office in Houston, Texas, assists the Company in its restructuring effort. The Company disclosed $21,098,818 in assets and $8,420,540 in liabilities as of the Petition Date. SPECIALTY PRODUCTS: Asbestos Trust Fights Move for Victims' Info ---------------------------------------------------------------- Trusts born out of several asbestos companies' bankruptcy cases are fighting back against what they say is an effort by a host of insurance companies, claims processing facilities and asbestos- tainted businesses - including Garlock Sealing Technologies LLC and Specialty Products Holding Corp. - to dig up mass amounts of information about alleged asbestos victims and the money they've received over the years, Dow Jones' DBR Small Cap reports. "Wasteful Effort" The committee representing asbestos claimants in Specialty Products Holding Corp.'s bankruptcy is objecting to the company's bid to conduct a probe, saying the proposed efforts to gather information from the claimants are "wasteful" and would still fall short of answering the question of liability in the case, Dow Jones' DBR Small Cap reports. According to the report, the committee of asbestos personal injury claimants -- composed of 10 personal injury claimants suffering from asbestos-related diseases, according to court papers -- is attempting to block Specialty Products from distributing a questionnaire to those holding alleged asbestos personal injury claims against it. The report notes that Specialty Products said that the move will save it time and money as it attempts to use its bankruptcy proceedings to create a trust that would distribute funds to asbestos victims and allow Specialty Products to shed its liability in the torts system. About Specialty Products Cleveland, Ohio-based Specialty Products Holdings Corp., aka RPM, Inc., is a wholly owned subsidiary of RPM International Inc. The Company is the holding company parent of Bondex International, Inc., and the direct or indirect parent of certain additional domestic and foreign subsidiaries. The Company claims to be a leading manufacturer, distributor and seller of various specialty chemical product lines, including exterior insulating finishing systems, powder coatings, fluorescent colorants and pigments, cleaning and protection products, fuel additives, wood treatments and coatings and sealants, in both the industrial and consumer markets. The Company and filed for Chapter 11 bankruptcy protection on May 31, 2010 (Bankr. D. Del. Lead Case No. 10-11780), estimating its assets and debts at $100,000,001 to $500,000,000. The Company's affiliate, Bondex International, Inc., filed a separate Chapter 11 petition on May 31, 2010 (Case No. 10-11779), estimating its assets and debts at $100,000,001 to $500,000,000. Gregory M. Gordon, Esq., Dan B. Prieto, Esq., and Robert J. Jud, Esq., at Jones Day, serve as bankruptcy counsel to the Debtors. Daniel J. DeFranceschi, Esq., and Zachary I. Shapiro, Esq., at Richards Layton & Finger, serve as co-counsel. Logan and Company is the Company's claims and notice agent. Blackstone Advisory Partners L.P. is the Debtors' financial advisor and investment banker. As of the Petition Date, the Debtors were defendants in over 10,000 pending asbestos-related bodily injury lawsuits. A significant portion of these lawsuits involve mesothelioma claims. Attorneys at Montgomery Mccracken Walker & Rhoads, LLP, serve as counsel to the Committee of Asbestos Personal Injury Claimants. STEPHANIE SERPA: Bank of America Says No to Cash Collateral Use --------------------------------------------------------------- Bank of America, N.A., says it doesn't consent to the use of cash collateral in Stephanie Serpa Ream's bankruptcy case. Bank of America is a secured creditor of JS Development Company, a Nevada general partnership. J.S. Development has caused the property securing the loan from Bank of America to be transferred prepetition to the Debtor. Bank of America is represented by Snell & Wilmer L.L.P. Los Gatos, California-based Stephanie Serpa Ream filed for Chapter 11 bankruptcy protection on October 20, 2010 (Bankr. D. Nev. Case No. 10-54146). Stephen R. Harris, Esq., at Belding, Harris & Petroni, LTD, assists the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. SUNESIS PHARMCEUTICALS: Posts $5.1 Million Net Loss in Q3 2010 -------------------------------------------------------------- Sunesis Pharmaceuticals, Inc., reported a net loss was $5.1 million for the third quarter ended September 30, 2010 and a net loss of $14.5 million for the nine months ended September 30, 2010. As of September 30, 2010, cash, cash equivalents and marketable securities totaled $40.8 million, with no debt outstanding. On October 6, 2010, Sunesis closed an underwritten offering for gross proceeds of $15.5 million. "Sunesis has recently achieved several corporate milestones," said Daniel Swisher, Chief Executive Officer of Sunesis. "We are on track to enroll the first patient in the VALOR trial in the fourth quarter of this year. With over $55 million in cash following our October offering, Sunesis believes that it now has the resources available and accessible to fund the VALOR trial until its planned unblinding in mid-2013." The Company's balance sheet at September 30, 2010, showed $43.0 million million in total assets, $3.5 million in total liabilities, $54,789 in non-current portion of deferred rent, and stockholders' equity of $39.4 million. As reported in the Troubled Company Reporter on April 6, 2010, Ernst & Young, LLP, in Palo Alto, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted of the Company's recurring losses from operations. A full-text copy of the earnings release is available for free at: http://researcharchives.com/t/s?6d3f About Sunesis Pharmaceuticals South San Francisco, Calif.-based Sunesis Pharmaceuticals, Inc. (NASDAQ: SNSS) -- http://www.sunesis.com/-- is biopharmaceutical company focused on the development and commercialization of new oncology therapeutics for the treatment of solid and hematologic cancers. SUNGARD DATA: Moody's Assigns 'Caa1' Rating to $500 Mil. Notes -------------------------------------------------------------- Moody's Investors Service assigned a Caa1 rating to SunGard Data System's proposed $500 million senior unsecured notes offering. The proceeds from the proposed notes will be used to refinance a portion of the existing 9.125% Senior Unsecured Notes due 2013. The assigned ratings are subject to review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. Ratings Rationale SunGard's B2 corporate family rating reflects the company's high financial leverage of about 6x (debt-to-EBITDA, adjusted for leases and Moody's standard adjustments) and aggressive financial policies due to its acquisitive nature. Since the LBO in 2005, the company has not de-levered significantly and Moody's expects that management will remain acquisitive in order to further expand and diversify its revenue base while seeking growth opportunities. These credit risks are mitigated by the company's solid market position as a leading provider of business continuity and financial institution processing services and its strong business profile, as represented by low customer concentration, diverse product line offerings, and broad geographic reach. In addition, the company has displayed a relatively consistent and recurring revenue base and solid free cash flow generation even during economic recessions. The stable outlook incorporates Moody's expectation that SunGard will maintain credit metrics consistent with B2 rated companies with modest improvement to its financial leverage and other financial metrics. The stable outlook also assumes SunGard will not increase its debt leverage significantly or make dividend payments to its private equity sponsors. Despite the downturn and operating weakness across the financial services sector, the company, through its diverse service offerings and highly recurring revenue model, continues its stable performance during the downturn and maintains profit margins approximately in line with current levels. If the company were to incur additional leverage, the rating and/or outlook could experience negative rating pressure. This new rating was assigned: * $500 million Senior Unsecured Notes -- Caa1 (LGD 5, 79%) These ratings were affirmed/assessments revised: * Corporate Family Rating -- B2 * Probability of Default Rating -- B2 * $830 million Secured Revolving Credit Facility due 2011 and 2013 -- Ba3 (LGD-2, 27% from 28%) * $4.7 billion Secured Term Loan Facility due 2014 and 2016 -- Ba3 (LGD-2, 27 from 28%) * $250 million Senior Notes due 2014 -- B3 (LGD-4, 64% from 65%) * $500 million Senior Unsecured Notes due 2015 -- Caa1 (LGD-5, 79% from 80%) * $1.1 billion Senior Notes due 2013 -- Caa1 (LGD-5, 79% from 80%) * $1.0 billion Senior Subordinated Notes due 2015 -- Caa1 (LGD-6, 94%) * Speculative Grade Liquidity Rating -- SGL-2 With about $5.3 billion in revenues for the twelve months ended September 30, 2010, SunGard Data Systems Inc., headquartered in Wayne, Pennsylvania, is a provider of software and IT services. SunGard was acquired in a leveraged buy-out by a consortium of private equity investors (including Bain, Blackstone, KKR, Silver Lake, Texas Pacific Group, GS Partners, and Providence Equity) in August 2005. SUNGARD DATA: Fitch Assigns 'B-/RR5' Rating to $500 Mil. Notes -------------------------------------------------------------- Fitch Ratings has assigned a 'B-/RR5' rating to SunGard Data Systems Inc.'s proposed $500 million senior unsecured note offering. Proceeds from the offering are expected to be used to refinance a portion of the company's $1.6 billion 9.125% senior unsecured notes due 2013. SunGard disclosed in its prospectus filing that it is contemplating a spin-off of its Availability Services business segment. It expects that if a spin were to occur, that AS would incur new debt and SunGard would reduce existing debt at the remaining company. Additionally, SunGard also disclosed that it expects to receive cash from an equity issuance of one of its parent companies coincident with any spin of AS. Fitch believes that this potential event could ultimately reduce leverage for the remaining company and be beneficial for bondholders. However, plans for a spin of AS and equity issuance are preliminary and may be delayed in part or indefinitely. The AS business contributed $1.5 billion in revenue over the latest 12 month period (end Sept. 30, 2010), approximately 28% of total company revenue, and $329 million in operating income, or approximately 29% of total segment operating income. Fitch currently rates SunGard: -- Issuer Default Rating at 'B'; -- $4.7 billion senior secured term loan due 2014 and 2016 at 'BB-/RR2'; -- $829 million senior secured revolving credit facility (RCF) due 2011 and 2013 at 'BB-/RR2'; -- $250 million 4.875% senior notes due 2014 at 'B/RR4'; -- $1.6 billion 9.125% senior unsecured notes due 2013 at 'B- /RR5'; -- $500 million 10.625% senior unsecured notes due 2015 at 'B- /RR5'; -- $1 billion 10.25% senior subordinated notes due 2015 at 'CCC/RR6'. The Rating Outlook is Stable. The ratings are supported by SunGard's: -- Strong recurring revenue profile supported by longer-term contracts and significant switching costs; -- Consistent free cash flow; -- Leading positions in each of its businesses due to its significant scale and product breadth; and -- Well-diversified customer portfolio. Rating concerns include: -- Fitch's expectations that SunGard's debt levels and debt service requirements will remain significant over the intermediate term; -- Ongoing operating EBITDA margin erosion, due mainly to aggressive pricing related to retaining long-term customer contracts, as well as ongoing acquisitions; -- Significant exposure to and longer-term uncertainty around the size and structure of the financial services industry; and -- Integration risks associated with Fitch's belief that the company will continue its historical bias toward augmenting mature organic revenue growth rates with acquisitions. Total debt at Sept. 30, 2010, was $8.3 billion and consisted primarily of: 1) $4.7 billion of senior secured term loans, of which approximately $2 billion expires 2014 and $2.7 billion expires 2016; 2) $277 million outstanding under the company's on- balance-sheet accounts receivable securitization facility, which matures in September 2014; 3) approximately $237 million of 4.875% senior notes due 2014 ($250 million at maturity), which were originally unsecured when issued in 2004 but which became secured by real property in the leveraged buyout (LBO); 4) $1.6 billion of 9.125% senior unsecured notes due 2013; 5) approximately $496 million of 10.625% senior unsecured notes due 2015 ($500 million at maturity); and 6) $1 billion of 10.25% senior subordinated notes due 2015. Fitch estimates SunGard's leverage (total debt / operating EBITDA) at 6.2 times for the LTM period ending Sept. 30, 2010, or 6.4x when adjusted for operating leases. Fitch estimates that funds from operations less capital expenditures to total debt at 4% for the LTM period. This measure of cash flow leverage eliminates potential quarterly variations from working capital related cash flows while also normalizing the comparison of leverage between companies that have different accounting methods. As of Sept. 30, 2010, Fitch believes SunGard's current liquidity position was sufficient, given the company's minimal near-term debt service needs. Liquidity consisted of $787 million of cash (approximately half of which is located outside the U.S.) and approximately $796 million available under its $829 million RCF (net of $33 million letters of credit outstanding), of which $249 million expires August 2011 and $580 million expires 2013. Liquidity is also supported by annual free cash flow, which Fitch expects will be at least $300 million in 2010, given expectations for flat operating profit. SunGard's recovery ratings reflect Fitch's belief that the company would be reorganized rather than liquidated in a bankruptcy scenario, given Fitch's estimates that the company's ongoing concern value is significantly higher than its projected liquidation value, due mostly to the significant value associated with SunGard's intangible assets. In estimating ongoing concern value, Fitch applies a valuation multiple of 5x to the company's discounted EBITDA. Fitch discounts SunGard's normalized operating EBITDA by 25%, approximately corresponding to the EBITDA level that would breach the company's leverage covenant in the secured credit agreement. After reductions for administrative and cooperative claims, Fitch arrives at an adjusted reorganization value of approximately $5.6 billion. Based upon these assumptions, the senior secured debt, including $829 million revolving credit and $4.7 billion of term loan facilities recover approximately 71%-90%, resulting in 'RR2' ratings for both tranches of debt. The senior notes' 'RR4' recovery rating reflects the partial security these notes received during the leveraged buyout process and Fitch's belief that the secured bank debt is in a superior position due to its right to the company's intellectual property. The 'RR5' recovery rating for the $2.1 billion senior unsecured debt reflects Fitch's estimate that 11%-30% recovery is reasonable, while the 'RR6' recovery rating for the $1 billion of subordinated debt reflects Fitch's belief that negligible recovery would be achievable due to its deep subordination to other securities in the capital structure. SUNGARD DATA: S&P Assigns 'B' Rating on Senior Unsecured Debt ------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B' senior unsecured rating and '5' recovery rating to Wayne, Pa.-based SunGard Data Systems Inc.'s senior unsecured notes due 2018. The '5' recovery rating indicates S&P's expectation for modest (10%- 30%) recovery of principal in the event of payment default. The company intends to use proceeds of the new notes to partially repurchase or redeem the 9.125% senior notes due 2013. "The rating on SunGard," said Standard & Poor's credit analyst Molly Toll-Reed, "reflects S&P's expectation that the company's satisfactory business profile and significant base of recurring revenues will continue to support its highly leveraged financial profile." Ratings also reflect SunGard's strong position in the fragmented market for investment-support processing software and healthy cash flow generation. The proposed debt transaction does not affect the 'B+' long-term corporate credit rating. SunGard has indicated that it is evaluating alternatives with respect to its Availability Services segment, including a potential spin-off of the business. However, the success, timing, and capital structure of SunGard following any potential actions, are not certain and are not incorporated in S&P's ratings or outlook at this time. While a spin-off would reduce business diversity and cash flow, it could potentially also reduce the remaining debt burden at SunGard. Nonetheless, SunGard's current ownership structure limits a possible upgrade. S&P will assess the impact of any transaction if and when there is a proposal to evaluate. Ratings List SunGard Data Systems Inc. Corporate Credit Rating B+/Stable/-- Rating Assigned SunGard Data Systems Inc. Senior Unsecured due 2018 B Recovery Rating 5 SYNIVERSE TECHNOLOGIES: Carlyle Deal Won't Affect Moody's Ratings ----------------------------------------------------------------- Moody's says Syniverse Technologies, Inc.'s ratings (Ba3 CFR) are not affected by the announcement that it had entered an agreement to be taken private by The Carlyle Group. While a going private transaction will likely result in increased leverage, Syniverse's existing debt would most likely be paid off and Moody's existing ratings withdrawn. The last rating announcement was on September 9, 2010, when Moody's revised Syniverse's ratings outlook to positive. Based in Tampa, Florida, Syniverse Technologies is a provider of technology outsourcing to wireless telecommunications carriers with annualized revenues of over $600 million for the period ended June 30, 2010. TAYLOR BEAN: Plan Partly Pays $8 Billion in Claims -------------------------------------------------- Taylor Bean & Whitaker Mortgage Corp. has a hearing on Nov. 5 for approval of the disclosure statement explaining the liquidating Chapter 11 plan supported by the official creditors' committee. The Plan Proponents request that the Court establish these dates with respect to confirmation of the Plan: January 12, 2011 Deadline for submission of Ballots on the Plan and objections to confirmation. January 19, 2011 Confirmation Hearing November 5, 2010 Record Date Ballots must be delivered to the Debtor's balloting agent: BMC Group, Inc. Taylor, Bean & Whitaker Mortgage Corp. Ballot Processing Center P.O. Box 3020 Chanhassen, MN 55317-3020 According to the Bill Rochelle, the bankruptcy columnist for Bloomberg News, the disclosure statement says assets to be administered under the plan eventually will total from $322 million to $521 million. After claims with higher priority are paid, between $264 million and $354 million will remain for unsecured creditors with claims totaling more than $8 billion. The distribution to unsecured creditors is expected to range between 3.3% and 4.4%, according to the disclosure statement. As reported in the Troubled Company Reporter on September 27, the Plan proposed by the Debtor and the Official Committee of Unsecured Creditors contemplates the formation of a single liquidating trust for the benefit of creditors, which will succeed to all assets of the Debtors. The Plan trustee will, among other things, liquidate the non-cash assets transferred to the plan trust, reconcile claims against the Debtors, make distributions to holders of allowed claims, and wind down the Chapter 11 cases and the Debtors' respective estates. There are no guaranteed recovery and there are no guaranteed amounts of recovery for any holder of claim. There will be no recovery for any holder of an interest. In addition, the Plan provides for the establishment of a cash reserve for disputed claims within any particular class. The process of distributing cash under the Plan will be completed over time. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/TaylorBean_DS.pdf About Taylor Bean Taylor, Bean & Whitaker Mortgage Corp. grew from a small Ocala- based mortgage broker to become one of the largest mortgage bankers in the United States. In 2009, Taylor Bean was the country's third largest direct-endorsement lender of FHA-insured loans of the largest wholesale mortgage lenders and issuer of mortgage backed securities. It also managed a combined mortgage servicing portfolio of approximately $80 billion. The company employed more that 2,000 people in offices located throughout the United States. Taylor Bean filed for Chapter 11 bankruptcy protection August 24 (Bankr. M.D. Fla. Case No. 09-07047). Taylor Bean filed the Chapter 11 petition three weeks after federal investigators searched its offices. The day following the search, the Federal Housing Administration, Ginnie Mae and Freddie Mac prohibited the company from issuing new mortgages and terminated servicing rights. Taylor Bean estimated more than $1 billion in both assets and liabilities in its bankruptcy petition. Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain & Prosser, PA, in Tampa, Florida, represents the Debtor. Troutman Sanders LLP is special counsel. BMC Group, Inc., serves as claims agent. TERRESTAR NETWORKS: Proposes Dec. 11 Claims Bar Date ---------------------------------------------------- TerreStar Networks, Inc., and its debtor affiliates ask the United States Bankruptcy Court for the Southern District of New York to establish: (a) December 11, 2010, as the date by which all entities -- other than governmental units -- that hold or wish to assert a claim against any of the Debtors that arose before the October 19, 2010 Petition Date, including a Claim pursuant to Section 503(b)(9) of the Bankruptcy Code, must file a proof of that claim; (b) April 18, 2011, as the date by which all governmental units holding claims that arose before the Petition Date must file proofs of claim, including Claims for unpaid taxes, whether the claims arose from prepetition tax periods or prepetition transactions to which any of the Debtors were a party; (c) the later of (i) the General Bar Date, or (ii) 21 days from the date on which the Debtors provide notice of an amendment to their Schedules of Assets and Liabilities, as the date by which claimants holding claims affected by the amendment must file Proofs of Claim; and (d) the later of (i) the General Bar Date, or (ii) 21 days from the date of entry of an order authorizing the Debtors to reject a contract or lease pursuant to Section 365 of the Bankruptcy Code, as the date by which a counterparty to a rejected contract or lease must file a Proof of Claim for rejection damages. Supplemental Bar Date The Debtors also seek the establishment of a supplemental bar date, as needed, with respect to (i) creditors to which a re- mailing of the notice of the General Bar Date is appropriate, but which cannot be accomplished in time to provide at least 21 days' notice of the applicable Bar Date, and (ii) creditors who become known to the Debtors after the applicable Bar Date. To ensure that parties-in-interest receive adequate notice of the Supplemental Bar Date, the Debtors propose to (i) file a notice of the Supplemental Bar Date with the Court, and (ii) mail notice of the Supplemental Bar Date to known creditors subject to the Supplemental Bar Date. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, notes that the vast majority of the Debtors' creditors will be subject to the General Bar Date and therefore, will receive at least 33 days' notice of it. "The Debtors do not anticipate establishing a Supplemental Bar Date until further into these Chapter 11 cases, if at all," he points out. The Debtors propose a 21-day notice period with respect to a Supplemental Bar Date, as delays resulting from an extended notice period at that point in time could hinder the progress of their Chapter 11 cases. Parties Required to File Proofs of Claim The Debtors propose that all of these entities must file Proofs of Claim on or before the applicable Bar Date: a. Any entity whose Claim against a Debtor is not listed in the applicable Debtor's Schedules or is listed as any of disputed, contingent, or unliquidated if the holder of the Claim desires to participate in any of the Chapter 11 cases or share in any distribution in the chapter 11 cases on account of the Claim. b. Any entity who believes that its Claim is improperly classified in the Schedules, is listed in an incorrect amount and who desires to have its Claim allowed in a classification or amount other than that identified in the Schedules. c. Any entity holding a Claim against a Debtor that is not listed in the applicable Schedules. d. Any entity holding a Claim that is allowable under Section 503(b)(9) of the Bankruptcy Code as an administrative expense of the Chapter 11 cases. Parties Not Required to File Proofs of Claim There are several categories of Claimants who, as a matter of law, procedure or case administration, should not be required to file a Proof of Claim by the applicable Bar Date. Specifically, Mr. Dizengoff notes, the Bar Dates should not apply to: a. Claimants who already filed a Proof of Claim against the Debtors with the Clerk of the Bankruptcy Court for the Southern District of New York or the Debtors' claims and noticing agent in the Chapter 11 cases, The Garden City Group, Inc., in a form substantially similar to Official Bankruptcy Form No. 10; b. Any Claim that is listed on the Debtors' Schedules; provided that: (i) the Claim is not scheduled as "disputed," "contingent" or "unliquidated;" (ii) the Claimant does not disagree with the amount, nature and priority of the Claim as set forth in the Schedules; and (iii) the Claimant does not dispute that the Claim is an obligation of the specific Debtor(s) as set forth in the Schedules; c. Any Claim that the Court allowed before the Bar Date Order; d. Any Claim against the Debtors that has been paid in full by any of the Debtors or any other party; e. Any Claim that is subject to other specific deadlines fixed by the Court; f. Any Claim held by a Debtor against another Debtor in the Chapter 11 cases; g. Any Claim of a current employee of the Debtors, if an order of the Court authorized the Debtors to honor the Claim in the ordinary course as a wage or benefit; provided, however, that a current employee must submit a Proof of Claim by the General Bar Date if his or her Claim relates to damages arising from Claims for wrongful termination, discrimination and workers' compensation insurance; h. Any Claim that is limited exclusively to the repayment of principal, interest or other applicable fees and charges owed under any bond or note issued by the Debtors pursuant to an indenture; provided, however, that: (i) an indenture trustee under a Debt Instrument must file one Proof of Claim, on or before the General Bar Date, with respect to all of the amounts owed under each of the Debt Instruments; and (ii) any holder of a Debt Claim wishing to assert a Claim, other than a Debt Claim, arising out of or relating to a Debt Instrument must file a Proof of Claim on or before the General Bar Date, unless another exception in the paragraph applies; i. Any Claimant whose Claim is based on an interest in an equity security of the Debtors; provided, however, that any Claimant who wishes to assert a Claim against any of the Debtors based on, without limitation, Claims for damages or rescission based on the purchase or sale of an equity security, must file a Proof of Claim on or before the General Bar Date. The Debtors reserve all rights with respect to any Claims including, inter alia, to assert that the Claims are subject to subordination pursuant to Section 510(b) of the Bankruptcy Code; and j. Any Claims allowable under Sections 503(b) and 507(a)(1) of the Bankruptcy Code as administrative expenses of the Debtors' Chapter 11 cases, with the exception of Claims allowable under Section 503(b)(9) of the Bankruptcy Code, which are subject to the General Bar Date. The Debtors propose that each Proof of Claim must be written in English with amounts denominated in U.S dollars. In addition, the Debtors ask that each Proof of Claim must include supporting documentation or an explanation as to why documentation is not available. All Proofs of Claim must be filed so as to be actually received no later than 5:00 p.m. prevailing Eastern Time, on the applicable Bar Date at: (a) if sent by first class U.S. mail (postage prepaid): TerreStar Networks Inc. c/o The Garden City Group, Inc. P.O. Box 9649 Dublin, OH 43017-4949 (b) if delivered in person, by courier service, or overnight delivery: TerreStar Networks Inc. c/o The Garden City Group, Inc. 5151 Blazer Parkway, Suite A Dublin, OH 43017 Mr. Dizengoff notes that the Debtors will not accept Proofs of Claim sent by facsimile or e-mail. Pursuant to Rule 3003(c)(2) of the Federal Rules of Bankruptcy Procedure, the Debtors propose that any Claimant who is required, but fails, to file a Proof of Claim in accordance with the Bar Date Order on or before the applicable Bar Date will be forever barred, estopped and enjoined from asserting its claim against the Debtors, and the Debtors' property will be forever discharged from any and all indebtedness or liability with respect to the Claim, and the holder will not be permitted to vote to accept or reject any Chapter 11 plan of reorganization filed in the Chapter 11 cases, or participate in any distribution on account of the Claim or receive further notices regarding the Claim. The Debtors, with the assistance of GCG, propose to complete the mailing by first class U.S. mail, postage prepaid, of these materials no later than three business days after the date of entry of the Bar Date Order: (1) written notice of the Bar Dates and, (2) the Proof of Claim Form. The information will notify parties of the Bar Dates and inform them as to whether they must file a Proof of Claim, the procedure for filing a Proof of Claim, and the consequences of failure to timely file a Proof of Claim. In addition to providing notice of the Bar Date Package by mail to individual recipients, and in the interest of ensuring that all Claimants receive notice of the Bar Dates, the Debtors note that it would be in the best interest of their estates to give additional notice of the Bar Dates by publication. In accordance with Rule 2002 of the Federal Rules of Bankruptcy Procedure, the Debtors further seek the Court's authority to publish the Bar Date Notice in the publications of The Washington Post, USA Today and the national edition of The Globe and Mail on one occasion on or before November 20, 2010. Pursuant to a request by the Debtors for a shortened notice period, the Court will conduct a hearing on November 8, 2010, at 10:00 a.m. prevailing Eastern Time to consider the Bar Date Motion. Objections are due not later than November 3, at 5:00 p.m. prevailing Eastern Time. About TerreStar Networks Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR) -- http://www.terrestar.com/-- is in the mobile communications business through its ownership of TerreStar Networks, its principal operating subsidiary, and TerreStar Global. TerreStar Networks, in cooperation with its Canadian partners, TerreStar Canada and TerreStar Solutions, majority-owned subsidiaries of Trio 1 and 2 General Partnerships, plans to launch an innovative wireless communications system to provide mobile coverage throughout the United States and Canada using integrated satellite-terrestrial smartphones and other devices. This system build out will be based on an integrated satellite and ground- based technology intended to provide communication service in most hard-to-reach areas and will provide a nationwide interoperable, survivable and critical communications infrastructure. The Company intends to provide multiple communications applications, including voice, data and video services. As of June 30, 2010, the Company had four wholly owned subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar Holdings Inc., and TerreStar New York Inc. Motient Ventures Holding Inc., a wholly owned subsidiary of MVH Holdings Inc., directly holds approximately 89.3% and 86.5% interest in TerreStar Networks and TerreStar Global, respectively. TerreStar Networks Inc. and Its affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No. 10-15446). The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not among the Chapter 11 filers. The Garden City Group, Inc. will act as claims and noticing agent in the chapter 11 cases. Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq. at Fraser Milner Casgrain LLP and Ira Dizengoff, Esq. , Arik Preis, Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer & Feld LLP , serve as bankruptcy counsel to the Debtors. Blackstone Advisory Partners LP is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes TerreStar Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by TerreStar Networks Inc. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TERRESTAR NETWORKS: Sec. 341 Meeting Set for November 10 -------------------------------------------------------- Tracy Hope Davis, the U.S. Trustee for Region 2, will convene a meeting of the creditors of TerreStar Networks, Inc., and its debtor affiliates on November 10, 2010, at 3:00 p.m. Eastern Time, at the office of the U.S. Trustee, 4th Floor, at 80 Broad Street, in New York. This is the first meeting of creditors under Section 341(a) of the Bankruptcy Code. The meeting offers creditors a one-time opportunity to examine the Debtors' representative under oath about the Debtors' financial affairs and operations that would be of interest to the general body of creditors. Attendance by the Debtor's creditors at the meeting is welcome, but not required. About TerreStar Networks Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR) -- http://www.terrestar.com/-- is in the mobile communications business through its ownership of TerreStar Networks, its principal operating subsidiary, and TerreStar Global. TerreStar Networks, in cooperation with its Canadian partners, TerreStar Canada and TerreStar Solutions, majority-owned subsidiaries of Trio 1 and 2 General Partnerships, plans to launch an innovative wireless communications system to provide mobile coverage throughout the United States and Canada using integrated satellite-terrestrial smartphones and other devices. This system build out will be based on an integrated satellite and ground- based technology intended to provide communication service in most hard-to-reach areas and will provide a nationwide interoperable, survivable and critical communications infrastructure. The Company intends to provide multiple communications applications, including voice, data and video services. As of June 30, 2010, the Company had four wholly owned subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar Holdings Inc., and TerreStar New York Inc. Motient Ventures Holding Inc., a wholly owned subsidiary of MVH Holdings Inc., directly holds approximately 89.3% and 86.5% interest in TerreStar Networks and TerreStar Global, respectively. TerreStar Networks Inc. and Its affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No. 10-15446). The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not among the Chapter 11 filers. The Garden City Group, Inc. will act as claims and noticing agent in the chapter 11 cases. Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq. at Fraser Milner Casgrain LLP and Ira Dizengoff, Esq. , Arik Preis, Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer & Feld LLP , serve as bankruptcy counsel to the Debtors. Blackstone Advisory Partners LP is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes TerreStar Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by TerreStar Networks Inc. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TERRESTAR NETWORKS: U.S. Trustee Names 7 to Creditors Committee --------------------------------------------------------------- Pursuant to Section 1102(a) and (b) of the Bankruptcy Code, Tracy Hope Davis, the United States Trustee for Region 2, has appointed seven creditors to serve as members of the Official Committee of Unsecured Creditors in the Chapter 11 cases of TerreStar Networks, Inc. and its debtor affiliates. The seven Committee Members are: (1) Deutsche Bank National Trust Company, Indenture Trustee 222 South Riverside Plaza - 25th Floor Chicago, Illinois 60606-5808 Attn: George F. Kubin, Vice President Tel. No. (312) 537-1159 (2) Hughes Network Systems, Inc. 11717 Exploration Lane Germantown, Maryland 20876 Attn: Sean P. Fleming, Senior Counsel Tel. No. (301) 428-5859 (3) Nokia Siemens Networks US LLC 5555 Glenridge Connector - Suite 800 Atlanta, Georgia 30342 Attn: Roland J. Behm, Vice President Tel. No. (469) 955-2416 (4) Qualcomm Incorporated 5775 Morehouse Drive San Diego, California 92121-1714 Attn: Adam Schwenker, Senior Director, Legal Counsel Tel. No. (858) 651-6958 (5) Shaffer Wilson Sarver & Gray, P.C. 1821 Michael Faraday Drive - Suite 302 Reston, Virginia 20190 Attn: Ray Schaffer, President Tel. No. (703) 471-6803 (6) Space Systems/Loral, Inc. c/o Loral Space Communications, Inc. 600 Third Avenue New York, New York 10016 Attn: Avi Katz, Esq., Senior Vice President & Secretary Tel. No. (212) 338-5605 (7) Van Vlissingen and Company One Overlook Point - Suite 100 Lincolnshire, Illinois 60069 Attn: John S. Nowrocki, Vice President Tel. No. (847) 634-2300 About TerreStar Networks Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR) -- http://www.terrestar.com/-- is in the mobile communications business through its ownership of TerreStar Networks, its principal operating subsidiary, and TerreStar Global. TerreStar Networks, in cooperation with its Canadian partners, TerreStar Canada and TerreStar Solutions, majority-owned subsidiaries of Trio 1 and 2 General Partnerships, plans to launch an innovative wireless communications system to provide mobile coverage throughout the United States and Canada using integrated satellite-terrestrial smartphones and other devices. This system build out will be based on an integrated satellite and ground- based technology intended to provide communication service in most hard-to-reach areas and will provide a nationwide interoperable, survivable and critical communications infrastructure. The Company intends to provide multiple communications applications, including voice, data and video services. As of June 30, 2010, the Company had four wholly owned subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar Holdings Inc., and TerreStar New York Inc. Motient Ventures Holding Inc., a wholly owned subsidiary of MVH Holdings Inc., directly holds approximately 89.3% and 86.5% interest in TerreStar Networks and TerreStar Global, respectively. TerreStar Networks Inc. and Its affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No. 10-15446). The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not among the Chapter 11 filers. The Garden City Group, Inc. will act as claims and noticing agent in the chapter 11 cases. Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq. at Fraser Milner Casgrain LLP and Ira Dizengoff, Esq. , Arik Preis, Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer & Feld LLP , serve as bankruptcy counsel to the Debtors. Blackstone Advisory Partners LP is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes TerreStar Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by TerreStar Networks Inc. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) THE UNION CREDIT UNION: NCUA Names Liquidating Agent ---------------------------------------------------- The National Credit Union Administration on October 29, 2010, appointed liquidating agent of The Union Credit Union (TUCU) of Spokane, Washington, by the Washington Department of Financial Institutions after DFI closed TUCU. Immediately following appointment as TUCU liquidating agent, NCUA entered into agreements with Alaska USA Federal Credit Union of Anchorage and Numerica Credit Union of Spokane to purchase and assume certain assets and liabilities of TUCU. TUCU members will experience no interruption of service and immediately become members of Numerica Credit Union. Their accounts remain federally insured by the National Credit Union Share Insurance Fund (NCUSIF) up to at least $250,000. Numerica Credit Union has $1 billion in assets and serves approximately 84,000 members. It is located at 14610 E. Sprague Avenue in Spokane. Alaska USA Federal Credit Union has $4.1 billion in assets and serves approximately 399,000 members. At the time of liquidation, TUCU had approximately $11,909,715 in assets and served 3,115 members. TUCU was established in 1968 to serve the members of Bricklayers Local 3. This is the 17th federally insured credit union liquidation in 2010. TRANSDIGM INC: Moody's Confirms Corporate Family Rating at 'B1' --------------------------------------------------------------- Moody's Investors Service confirmed TransDigm, Inc.'s B1 Corporate Family and Probability of Default ratings, the Ba2 rating on the company's existing term loan due June 2013, as well as the B3 rating on the existing 7 3/4% senior sub notes due July 2014. Moody's additionally assigned a Ba2 rating to TransDigm's proposed $300 million revolving credit facility and $900 million Term Loan B, as well as a B3 rating to the proposed $780 million senior subordinated note issue due November 2018. Proceeds of the new term loan B and notes will be used to fund the acquisition of McKechnie Aerospace for approximately $1.265 billion, refinance a portion of the company's existing first lien term loan, pay related transaction fees and expenses, as well as increase cash balances. The rating outlook was changed to negative from stable. This concludes the review for possible downgrade initiated on September 27, 2010. Rating Assigned: -- $300 million senior secured revolving credit facility due 2013, Ba2 (LGD2, 21%); -- $900 million senior secured term loan B due 2016, Ba2 (LGD2, 21%); -- $780 million senior subordinated notes due 2018, B3 (LGD5, 77%). Ratings Confirmed: -- Corporate Family Rating, B1; -- Probability of Default Rating, B1; -- Existing senior secured term loan due 2013, Ba2 (LGD2, 21%); -- $575 million 7 _% senior subordinated notes due 2014, B3 (LGD5, 77%); -- $425 million 7 _% senior subordinated notes due 2014, B3 (LGD5, 77%). The Ba2 rating on the company's current $200 million revolver will be withdrawn at the close of the transaction. Ratings Rationale The B1 CFR remains unchanged despite the significant debt financed acquisition of McKechnie as Moody's believe TransDigm's strong operating performance, high margins, and cash generation will enable the company to service the increased debt level and reduce leverage near-term to levels again more commensurate with the B1 rating. The B1 rating considers TransDigm's record of revenue growth and operating profitability driven by its broad niche product mix and its high margin aftermarket focus, product position on most aircraft, and the proprietary and sole sourced nature of most of its product offering. It is Moody's opinion that McKechnie's business profile largely parallel's TransDigm's - - highly proprietary products, significant margins, and major platform position in both OEM and aftermarket on most currently produced Boeing and Airbus aircraft. Though McKechnie's aftermarket business is not as significant a contributor as TransDigm's and the business produces somewhat lower margins, the combined company's characteristics will be basically unchanged from the existing TransDigm business model. It is anticipated that over time TransDigm will be able to implement its value driven operating strategy including pricing adjustments in order to maximize the profitability of McKechnie. Additionally, TransDigm's ratings benefit from the company's very good liquidity profile including a $300 million undrawn revolver, a substantial cash position, anticipated to be over $300 million pro-forma for the close of the transaction, as well as the expectation for continued strong positive free cash flow generation. The ratings however are constrained by the increase in leverage and very high absolute debt level (almost 300% of revenue pro-forma), use of acquisitions as a major driver in its growth strategy, and the company's history of a shareholder friendly financial policy of re-leveraging. The increase in pro- forma leverage for the proposed transaction takes the company's leverage to over 6x debt to EBITDA, outside the normal leverage levels for a B1 rating, mitigated by the company's uniquely strong margins, coverage metrics, and cash flow capabilities. The negative ratings outlook highlights the increased financial risk due to the major increase in funded debt, $1.4 billion or nearly 80%, particularly as it follows by only one year the debt financed $405 million special dividend. The negative outlook also reflects Moody's expectations that leverage will remain high for the B1 rating category through FY 2011, despite the expected improved aviation aftermarket environment. Although TransDigm is expected to be free cash flow positive over the near term, Moody's does not anticipate substantial debt repayment over the next 12 months. The rating could decline if the company fails to reduce leverage from current levels, pursues equity oriented transactions (dividends, etc.) or, though unexpected, experience a sustained decline in operating margins leading to a decline in operating cash flow. The rating outlook could be stabilized if leverage is reduced and sustained at below 5x debt to EBITDA. The last rating action for TransDigm was on September 27, 2010 when the company's B1 CFR and PDR were placed on review for possible downgrade. TransDigm, Inc., headquartered in Cleveland, Ohio, is a leading manufacturer of engineered aerospace components for commercial airlines, aircraft maintenance facilities, original equipment manufacturers and various agencies of the US Government. TransDigm Inc. is the wholly-owned subsidiary of TransDigm Group Inc. Net sales for the last 12 month period ending 7/03/10 were approximately $800 million. Pro-forma to include McKechnie, LTM revenue would approximate $1.1 billion. (These revenue numbers do not include full year impact of certain acquisitions made during the LTM period.) TRANSDIGM INC: S&P Affirms 'B+' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its ratings, including the 'B+' corporate credit rating, on Cleveland, Ohio-based TransDigm Inc. and removed them from CreditWatch, where S&P placed them with negative implications on Sept. 28, 2010. At the same time, S&P assigned its 'BB-' issue-level rating (one notch higher than the corporate credit rating) and '2' recovery rating to the company's proposed $300 million senior secured revolving credit facility due 2015 (which will replace the existing $200 million revolver) and $900 million senior secured term loan B due 2016, indicating S&P's expectation of substantial (70% to 90%) recovery in a payment default scenario. S&P also assigned its 'B-' issue-level rating (two notches lower than the corporate credit rating) and '6' recovery rating to the proposed $780 million subordinated notes due 2018, indicating S&P's expectation of negligible (0% to 10%) recovery. Proceeds of the new term loan and the notes will fund the proposed acquisition of McKechnie and repay $280 million of the existing term loan. The outlook is negative. "The ratings affirmation is based on S&P's expectations that TransDigm's very strong profit margins and improving commercial aerospace market conditions, combined with contributions by McKechnie, will enable the company to delever and restore credit metrics to levels more appropriate for the rating over the next 18 to 24 months," said Standard & Poor's credit analyst Roman Szuper. The debt-financed purchase of McKechnie, TransDigm's largest to date, will considerably weaken its credit metrics and increase the financial risk profile, which S&P now views as highly leveraged. Pro forma total debt to EBITDA will be more than 6x (including McKechnie EBITDA), compared with 4.7x for TransDigm alone on a trailing 12 month basis ended June 30, 2010. Pro forma total debt to EBITDA, including the new debt but excluding McKechnie EBITDA, will be more than 8x. However, S&P expects total debt to EBITDA to decline to about 5x over the next two years, reflecting primarily growing earnings, but no material debt reduction. TransDigm has the ability to delever quicker by using relatively strong free cash flow for debt reduction, but S&P views this as unlikely given the company's strategy to make frequent acquisitions (they contributed about a half of historical sales growth) funded partly with free cash flow. Key credit protection measures have fluctuated over the years and they were better than average for the rating prior to the October 2009 $400 million debt-financed dividend. S&P views TransDigm's business risk profile as fair, stemming from its participation in the cyclical and competitive commercial aerospace industry, partly offset by efficient operations, very high profit margins, well-established position in niche markets for highly engineered aircraft components, and product diversity strengthened somewhat by the McKechnie acquisition. McKechnie is a privately owned diversified aerospace supplier with 2010 sales of about $300 million, complementing TransDigm's competitive business position focusing on proprietary and sole source aerospace components with significant aftermarket content. TransDigm's sales from such products account for an overwhelming portion of total sales and represent a significant barrier to entry. This, combined with relatively low per-unit prices of the components, has allowed the company to steadily raise prices, even in periods of economic weakness. TransDigm has a history of effective integration and margin improvement of acquired companies by increasing efficiency, cutting costs, and obtaining better pricing, as demonstrated by its exceptional operating margins (before D&A) of 47%, before the McKechnie acquisition. While McKechnie does have strong operating margins in the low 30% area, S&P expects TransDigm to realize margin improvement as it integrates the business, although there are some risks involved with this relatively large acquisition. The recovering global economy, rebounding air traffic, much better airline profits, high aircraft utilization, modest airline capacity additions, and stabilized credit markets have improved conditions in commercial aerospace, following a steep decline in demand in 2009. This sector consists of original equipment products related to new aircraft (30% to 35% of TransDigm pro forma sales) and aftermarket products (about 40%). As a result, S&P expects increasing jetliner deliveries over the next two to three years, supported by announced production rate increases by Boeing Co. and Airbus SAS on their popular models. Global air traffic, a key driver of aftermarket sales generating most of TransDigm's earnings, has shown a solid recovery in 2010 and has enabled the company to increase related revenues compared with relatively weak levels in 2009. Further aftermarket gains will depend on worldwide economic recovery and the resulting air traffic growth. TransDigm's military business (25% to 30%) has benefitted from high levels of defense spending in recent years, although the growth of defense outlays has slowed noticeably and there could be more program cancellations or reductions. Therefore, S&P expects relatively flat military sales over the next 12 months. The outlook is negative. The McKechnie acquisition resulted in considerably weaker-than-expected credit protection measures. However, S&P expects TransDigm's very strong profit margins and improving commercial aerospace market conditions, combined with contributions by McKechnie, to enable the company to delever and restore credit metrics that are more appropriate for the rating over the next 12-18 months. S&P could revise the outlook to stable if management uses excess cash to reduce debt or higher earnings result in total debt to EBITDA of 5x-5.5x. S&P could lower the ratings if total debt to EBITDA remains above 6x at the end of 2011, which could be caused by integration challenges, a deterioration in aftermarket conditions, or increased debt. TRONOX INC: Wins Approval of $125MM Exit Loans from Wells Fargo --------------------------------------------------------------- The Hon. Allan L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York authorized Tronox Inc.. et al., to: a) enter into that certain $125 Million Senior Secured Credit Facility Commitment Letter, dated as of October 12, 2010, with Wells Fargo Capital Finance, LLC; and b) in connection therewith, incur certain indemnification obligations and to pay Wells Fargo an arrangement fee, a ticking fee and certain transaction expenses. The Debtor related that to fund cash payments required by the Plan and to meet the go-forward operating and working capital needs of the reorganized business, the Plan contemplates that Tronox will emerge from chapter 11 with approximately $470 million in funded debt borrowed under two facilities: (a) a $425 million senior secured term loan facility; and (b) a senior secured asset- based revolving credit facility with commitments of $125 million. Tronox recently received approval from the Court to engage Goldman Sachs Lending Partners LLC to refinance the existing term loans under its $425 million debtor-in-possession and exit financing facility. In exchange for Wells Fargo's commitment, which will remain open until January 31, 2011, Tronox agreed to pay certain customary fees and expenses, including: -- an arrangement fee of 1.75% of Wells Fargo's $125 million commitment, or $2,187,500, 50% of which is earned upon execution and delivery of the Commitment Letter and payable upon Bankruptcy Court approval thereof, and 50% of which is payable at the closing of the Revolving Facility; -- a ticking fee of 0.50% per annum on $125 million, the fee to accrue from and after the date the Commitment Letter is executed until the earlier of the closing of the Revolving Facility or the termination of the Commitment Letter; and -- Wells Fargo's reasonable and documented out-of-pocket fees and expenses in connection with the Commitment Letter and the documentation of the Revolving Facility (including the reasonable and documented fees and disbursements of Wells Fargo's counsel), including a $100,000 expense deposit. Overview of the Revolving Facility Lenders Wells Fargo Capital Finance, LLC and other institutions that may become parties to the financing arrangements as lenders as arranger may determine and are approved by the Company. Administrative Wells Fargo Capital Finance, LLC and Collateral Agent Revolving Facility An aggregate $125,000,000 senior secured revolving credit facility, consisting of revolving loans subject to the Borrowing Base, including a subfacility for letters of credit with a sublimit on LCs outstanding at any time of $50,000,000, and a portion of the facility available as Swingline loans (with a sublimit on Swingline Loans outstanding at any time in an amount to be determined). The Revolving Facility may include a separate revolving loan facility or subfacility to be provided with respect to export-related accounts receivable of the Borrowers based on a guarantee by the Export-Import Bank of the United States under its Working Capital Guarantee Program. The facility or subfacility will be on terms customary for similar facilities within the Working Capital Guarantee Program. Borrower will have the option to increase the facility to $150,000,000, subject to the terms and conditions of the Commitment Letter. Term The earlier of (a) 60 days prior to the maturity date of the Term Loan Exit Facility; and (b) four years from the Closing Date, subject to extensions as may be agreed by the Company and the lenders. Use of Proceeds To (a) fund certain fees and expenses associated with the Revolving Facility, (b) repay in full the Tranche B-2 Term Loan outstanding as of the Closing Date and (c) finance the ongoing working capital, capital expenditure and general corporate needs of Borrowers and the making of loans to other subsidiaries or affiliates. Interest Rate At Tronox's election, at one of the following rates, plus the Applicable Margin: - The Base Rate, which means the greatest of (i) the prime lending rate as announced from time to time by Wells Fargo Bank, N.A., (ii) the Federal Funds Rate plus 0.50% and (iii) the one month LIBOR Rate (which rate will be determined on a daily basis) plus 0.50%; or - The LIBOR Rate, which means the rate per annum, determined by Agent in accordance with its customary procedures, at which dollar deposits are offered to major banks in the London interbank market, adjusted by the reserve percentage prescribed by governmental authorities as determined by Agent. The LIBOR Rate will be available for an interest period of one, two, three or six months. Applicable Margin ranges from 2% to 2.5% in respect of the Base Rate, and 3% to 3.5% in respect of the LIBOR Rate, in each case depending on the Average Excess Availability under the Revolving Facility in the preceding 90 days. About Tronox Inc. Tronox Inc., aka New-Co Chemical, Inc., and 14 other affiliates filed for Chapter 11 protection on January 13, 2009 (Bankr. S.D.N.Y. Case No. 09-10156). The case is before Hon. Allan L. Gropper. Richard M. Cieri, Esq., Jonathan S. Henes, Esq., and Colin M. Adams, Esq., at Kirkland & Ellis LLP in New York, represent the Debtors. The Debtors also tapped Togut, Segal & Segal LLP as conflicts counsel; Rothschild Inc. as investment bankers; Alvarez & Marsal North America LLC, as restructuring consultants; and Kurtzman Carson Consultants serves as notice and claims agent. An official committee of unsecured creditors and an official committee of equity security holders have been appointed in the cases. The Creditors Committee has retained Paul, Weiss, Rifkind, Wharton & Garrison LLP as counsel. Until September 30, 2008, Tronox Inc. was publicly traded on the New York Stock Exchange under the symbols TRX and TRX.B. Since then, Tronox Inc. has traded on the Over the Counter Bulletin Board under the symbols TROX.A.PK and TROX.B.PK. As of December 31, 2008, Tronox Inc. had 19,107,367 outstanding shares of class A common stock and 22,889,431 outstanding shares of class B common stock. TROPICANA ENTERTAINMENT: Lenders Seek to Cut Final Fees ------------------------------------------------------- Bankruptcy Law360 reports that the steering committee for secured lenders to Tropicana Entertainment LLC has sought to slash millions of dollars in purportedly inflated legal and professional fees related to the casino operator's completed bankruptcy. About Tropicana Entertainment Tropicana Entertainment LLC and its units owned eleven casino properties in eight distinct gaming markets with premier properties in Las Vegas, Nevada, and Atlantic City, New Jersey. Tropicana Entertainment LLC and certain affiliates filed for Chapter 11 protection on May 5, 2008 (Bankr. D. Del. Case No. 08- 10856). Kirkland & Ellis LLP and Mark D. Collins, Esq., at Richards Layton & Finger, represent the Debtors in their restructuring efforts. Their financial advisor is Lazard Ltd. Their notice, claims, and balloting agent is Kurtzman Carson Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors' Web site administration agent. AlixPartners LLP is the Debtors' restructuring advisor. Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell LLP represent the Official Committee of Unsecured Creditors in this case. Capstone Advisory Group LLC is financial advisor to the Creditors' Committee. The OpCo Debtors, a group of Tropicana entities owning casinos and resorts in Atlantic City, New Jersey and Evansville, Indiana obtained confirmation from the Bankruptcy Court of a reorganization plan. On April 29, 2009, non-debtor units of the OpCo Debtors, designated as the New Jersey Debtors -- Adamar of New Jersey, Inc., and its affiliate, Manchester Mall, Inc. -- filed for Chapter 11 (Bankr. D. N.J. Lead Case No. 09- 20711) to effectuate a sale of the Atlantic City Resort and Casino to a group of Investors-led by Carl Icahn. Judge Judith H. Wizmur presides over the cases. Manchester Mall is a wholly owned subsidiary of Adamar that owns and operates certain real property utilized in the New Jersey Debtors' business operations. Effective March 8, Tropicana Entertainment successfully emerged from the Chapter 11 reorganization process as an Carl Icahn-owned entity. A group of Tropicana entities, known as the LandCo Debtors, which own Tropicana casino property in Las Vegas, have obtained approval of a separate Chapter 11 plan. Ilana Volkov, Esq., and Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman & Leonard, in Hackensack, New Jersey, represented the New Jersey Debtors. Kurtzman Carson Consultants LLC acts as their claims and notice agent. Adamar disclosed $500 million to $1 billion both in total assets and debts in its petition. Manchester Mall disclosed $1 million to $10 million in total assets, and less than $50,000 in total debts in its petition. Debtors Adamar of New Jersey Inc. and Manchester Mall Inc. have merged into Adamar of NJ In Liquidation, LLC. The merger and name change is in accordance with an Amended and Restated Purchase Agreement, which governs the sale and transfer of the operations of the Tropicana Casino and Resort - Atlantic City, including substantially all of the New Jersey Debtors' assets, to Tropicana Entertainment Inc., Tropicana Atlantic City Corp., and Tropicana AC Sub Corp., free and clear of any and all liens, claims and encumbrances. Bankruptcy Creditors' Service, Inc., publishes Tropicana Bankruptcy News. The newsletter tracks the chapter 11 restructuring proceedings commenced by Tropicana Entertainment LLC and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). ULTIMATE ESCAPES: Selling Properties to Three Buyers ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Ultimate Escapes Inc. was authorized to sell its properties last week. According to the report, secured lender CapitalSource Finance LLC is buying most of the properties in exchange for $52.7 million in secured debt. Laurence Development LP bought 10 properties for $14.3 million cash. One property went for $1.8 million cash. About Ultimate Escapes 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. UNI-PIXEL INC: Posts $1.5 Million Net Loss in September 30 Quarter ------------------------------------------------------------------ Uni-Pixel, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $1.48 million on $37,273 of revenue for the three months ended September 30, 2010, compared with a net loss of $1.51 million on $0 revenue for the same period last year. The Company has negative working capital of $2.99 million and has an accumulated deficit of $52.86 million as of September 30, 2010. The Company's balance sheet as of September 30, 2010, showed $1.26 million in total assets, $4.15 million in total liabilities, and a stockholders' deficit of $2.89 million. PMB Helin Donovan, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has sustained losses and negative cash flows from operations since inception. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?6d3d The Woodlands, Tex.-based Uni-Pixel, Inc. (OTC BB: UNXL) -- http://www.unipixel.com/-- is a production stage company delivering its Clearly Superior(TM) Performance Engineered Films to the Lighting & Display, Solar and Flexible Electronics market segments. UNION CARBIDE: Moody's Ups Ratings on Debentures to Baa3 From Ba2 ----------------------------------------------------------------- Moody's Investors Service changed the outlook on the debt of The Dow Chemical Company to stable from negative. Moody's affirmed Dow's remaining ratings at Baa3 and raised the ratings on Union Carbide Corporation debentures to Baa3 reflecting the decline in asbestos liability cases and its large receivable from Dow. Moody's also withdrew the ratings on several issues of legacy Rohm and Haas debt. Ratings Rationale Dow's stable outlook reflects the company's stronger than anticipated earnings performance since its acquisition of Rohm and Haas Company in 2009, management's continuing emphasis on debt reduction and Moody's expectation that Dow will be able to generate metrics that would fully support an investment grade rating in 2011. Quarterly EBITDA in 2010 has improved significantly from the recessionary levels of 2009, exceeding $1.8 billion in every quarter. Third quarter EBITDA was much stronger than previously anticipated as cash margins for several key commodities expanded more than offsetting the normal seasonal weakness. Low U.S. natural gas prices and associated liquids will continue to benefit earnings from its Basic Chemicals and Basic Plastics segments over the next several years and lower feedstock costs in its Performance segments. Furthermore, Moody's believes that Dow's advantaged U.S. ethylene position will facilitate the successful formation of a "K-Dow" like venture over the next 12-18 months, greatly accelerating Dow's potential deleveraging. Moody's raised the ratings on the senior unsecured debentures issued by Union Carbide to Baa3 reflecting Dow's stable outlook, a significant decline in cash costs related to the litigation and settlement of UCC's asbestos claims, and the size of the receivables from Dow on UCC's balance sheet. In 2003, UCC moved to a more aggressive litigation strategy with respect to asbestos product litigation claims, which has resulted in a substantial reduction in large settlements with plaintiffs' lawyers and the dismissal of a much larger number of cases. This strategy has modestly reduced the per claimant cost and allowed the company to reduce the absolute number of individual claimants from over 130,000 to less than 45,000 as of June 30, 2010. Over this same period, UCC has generated a substantial amount of cash which has been loaned to Dow. With the divestiture of some of UCCs assets in 2009, this receivable has grown to over $4.1 billion as of June 30, 2010. Moody's believe that the size of this receivable dwarfs any reasonable estimation of UCC asbestos liability, the estimated future pension and benefit costs, as well as the $571 million of outstanding debt on the balance sheet. Hence, UCC debenture holders should have the same senior unsecured claim on Dow as Dow's existing bondholders, which is reflected in the Baa3 rating. The ratings on the Rohm and Haas Euro Notes due 2012 and Notes due 2029, are being withdrawn due to the expectation that information will not be adequate to maintain the rating. Ratings Assigned: Issuer: Dow Chemical Company -- $3 billion Revolving Facility due 2014, at Baa3 Ratings Upgrades: Issuer: Union Carbide Corporation -- UCC 7.875% Debentures due 2023, to Baa3 from Ba2 -- UCC 7.5% Debentures due 2025, to Baa3 from Ba2 -- UCC 7.75% Debentures due 2096, to Baa3 from Ba2 -- UCC varioous IRBs, to Baa3 from Ba2 Ratings Withdrawn: Issuer: Rohm and Haas (R&H) R&H Euro Notes due 2012 R&H Notes due 2029 Ratings Affirmed: -- Dow Long Term Issuer Rating, at Baa3 -- Dow Commercial Paper, at P-3 -- Dow Shelf, at Baa3 -- Dow Notes due in next 12 months, at Baa3 -- Dow Notes due in 2012, at Baa3 -- Dow Notes due after 2012, at Baa3 -- Dow IRB/PCRB, at Baa3 -- R&H Notes due 2013, at Baa3 -- R&H Notes due 2017, at Baa3 -- R&H Notes due 2020, at Baa3 -- Morton Debentures due 2020, at Baa3 The Dow Chemical Company (Baa3 Issuer Rating, stable outlook) is one of the largest chemical companies in the world, with LTM (ending June 30, 2010) revenues over $52 billion. Dow has global leadership positions in a broad array of chemicals, including ethylene, polyethylene, polyurethanes, and epoxies, and many specialty chemicals and materials. UNITED WESTERN: Inks Oak Hill Investment Deal & JPM Forbearance --------------------------------------------------------------- United Western Bancorp, Inc., and Equi-Mor Holdings, Inc., its direct subsidiary, entered into a Fifth Forbearance and Amendment Agreement with JPMorgan Chase Bank, N.A., on October 29, 2010. The terms of the Fifth Forbearance Agreement provide, among other things, that (i) JPMorgan agrees to forbear from exercising its rights and remedies under the Loan Documents on account of the Fifth Forbearance Disclosed Defaults provided the Company and the Pledgor satisfy all obligations set forth in the Fifth Forbearance Agreement from the Effective Date as defined in the Agreement until the earlier of: (i) the end of business on January 14, 2011; or (ii) the occurrence of a default, other than the Fifth Forbearance Disclosed Defaults, under any of the Loan Documents, the Fifth Forbearance Agreement or any other agreement required to be entered into by the Fifth Forbearance Agreement. The forbearance by JPMorgan is conditioned upon, among other things, the Company entering into an investment agreement with at least two anchor investors on or before October 31, 2010, with the investment agreement providing for the investment by the anchor investors of no less than $91 million and collectively, an investment of approximately $200 million of new money capital in the Company. The Company entered into an investment agreement on October 28, 2010, with Oak Hill Capital Partners III, L.P. and Oak Hill Capital Management Partners III, L.P., Lovell Minnick Equity Partners III LP and Lovell Minnick Equity Partners III-A LP, Legent Group, LLC, and Henry C. Duques, the former Chairman and Chief Executive Officer of First Data Corporation. Pursuant to the Investment Agreement, the Company will seek to raise in the aggregate at least $200,000,000 but not more than $205,000,000, and the Lead Anchor Investors will each purchase 117,500,000 shares of common stock, par value $0.0001 per share, of the Company for $0.40 per share, for a total investment of $94,000,000. The Legent Group will purchase 7,500,000 shares of Common Stock for $0.40 per share, for a total investment of $3,000,000, and Duques will purchase 15,000,000 shares of Common Stock for $0.40 per share, for a total investment of $6,000,000. In addition, each Anchor Investor will each receive warrants to purchase 10.0% of the number of shares of Common Stock that they purchased under the Investment Agreement. A full-text copy of the Investment Agreement is available at no charge at http://ResearchArchives.com/t/s?6d43 The terms of the Fifth Forbearance Agreement also provide that the Company will pay JPMorgan monthly interest payments for the months of October, November and December of 2010 and January of 2011; provided, however, that the Fifth Forbearance Interest Payments are subject to the Company's prior receipt of the written non- objection of the Office of Thrift Supervision. In addition, the terms of the Fifth Forbearance Agreement provide that the Company will cause the proceeds of any Stated Capital Raise to be used, first and foremost, to pay off all the Liabilities the Company owes to JPMorgan under the Loan Documents, provided, however, that the Liabilities under the Loan Documents shall be deemed to be fully satisfied if: (A) on or before January 14, 2011, the Company pays to JPMorgan an amount from the proceeds of the Stated Capital Raise equal to the sum of: (i) $10,562,500, (ii) all accrued but unpaid interest due under the Loan Documents and (iii) all other fees, costs and expenses due under the Loan Documents; and (B) no Forbearance Default occurs prior to receipt of the Capital Proceeds Payment. The payment by the Company of the Capital Proceeds Payment to JPMorgan is subject to the Company's prior receipt of the written non- objection of the OTS. A full-text copy of the JPM Forbearance Agreement is available at no charge at http://ResearchArchives.com/t/s?6d44 Letter Agreement with Equity Trust Company The Company's subsidiary United Western Bank(R) entered into a letter agreement on October 27, 2010, with Equity Trust Company, Equity Administrative Services, Inc., and Sterling Administrative Services, LLC, whereby ETC and the Companies agree not to exercise their right to terminate the Amended and Restated Subaccounting Agreement dated June 27, 2009, as amended, in the event the Bank were to file its thrift financial report with the OTS which reflects that the Bank is undercapitalized as defined in 12 C.F.R. Sec. 565.4(b)(3) during the Restricted Period, as defined in the Letter Agreement. A full-text copy of the ETC Agreement is available at no charge at http://ResearchArchives.com/t/s?6d45 Amendment Number 1 to Purchase Agreement On October 28, 2010, the Company and the Bank -- as buyers -- entered into Amendment Number 1 to Purchase Agreement with Legent Group and Duques -- as sellers -- whereby the Buyers and Sellers agreed to amend that certain Purchase Agreement dated June 9, 2010, regarding the sale of Legent Clearing, LLC, by (i) extending the Drop Dead Date to November 30, 2010, or to December 31, 2010 if any consent or approval required to be obtained from any banking regulatory agency or any Governmental or Regulatory Entity has not been obtained by November 30, 2010; (ii) allowing the Sellers, on or prior to the closing of the sale transaction, to contribute cash to Legent Clearing, LLC to the extent necessary to make the Adjusted Book Value equal to or less, but not in excess of, $10 million; and (iii) agreeing to reduce the Escrowed Funds from $6 million to $3 million and allowing Legent Group or Duques to utilize the $3 million in the reduced Escrowed Funds proceeds to be used as an investment pursuant to the Investment Agreement. A full-text copy of Amendment No. 1 is available at no charge at http://ResearchArchives.com/t/s?6d47 About Lovell Minnick Partners Lovell Minnick Partners LLC -- http://www.lovellminnick.com/-- is a private equity firm providing buyout and growth capital to companies in the financial services industry. From offices in the Los Angeles and Philadelphia areas, Lovell Minnick manages private equity partnerships totaling $800 million on behalf of qualified private and institutional investors. Portfolio companies of Lovell Minnick operate in various areas of the global financial services industry, including asset management, financial product distribution, outsourced administration services, securities brokerage, financial consulting, and commercial and trust banks. About Oak Hill Capital Management Oak Hill Capital -- http://www.oakhillcapital.com/-- is a private equity firm with more than $8.2 billion of committed capital from leading entrepreneurs, endowments, foundations, corporations, pension funds and global financial institutions. Robert M. Bass is the lead investor. Over a period of more than 24 years, the professionals at Oak Hill Capital and its predecessors have invested in more than 60 significant private equity transactions. Oak Hill Capital is one of several Oak Hill partnerships, each of which has a dedicated and independent management team. These Oak Hill partnerships comprise over $30 billion of investment capital across multiple asset classes. About United Western Bancorp Denver, Colorado-based United Western Bancorp, Inc. (NASDAQ: UWBK) -- http://www.uwbancorp.com/-- is a holding company whose principal subsidiary, United Western Bank, is a community bank focused on Colorado's Front Range market and selected mountain communities. UNIVERSITY CITY: S&P Gives Positive Outlook, Affirms 'B' Rating --------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on Orlando, Florida-based theme park operator University City Development Partners Ltd. to positive from stable. All existing ratings on the company, including S&P's 'B' corporate credit rating, were affirmed. "The outlook revision is based upon very strong preliminary third- quarter results, and S&P's expectation that performance will likely continue to be strong in 2011," said Standard & Poor's credit analyst Andy Liu. The Wizarding World of Harry Potter appears to be having a significantly positive effect on operating performance. During the quarter ended Sept. 30, 2010, attendance climbed 36%, revenues increased 62% to $364 million, and EBIT more than doubled to $127 million. This is the first full operating quarter with the Harry Potter attraction, which officially opened in late June. Furthermore, given the fact that the final Harry Potter movie will be released in two installments--one later this month and the other in the summer of 2011--S&P believes that this strong momentum will carry into next year. Based on the strong preliminary third-quarter results, S&P expects full-year revenue growth to likely exceed 25% and that EBITDA growth could reach 20% in 2010. S&P further anticipates that leverage will approach the mid-5x area by the end of 2010 and that discretionary cash flow will exceed $80 million. S&P is also incorporating the expectation that EBITDA will increase in the high-single-digit percentage area in 2011, driven by continued strong visitation trends stemming from the Harry Potter attraction. Under this forecast scenario, S&P expects credit measures to improve meaningfully and to be more reflective of a 'B+' rating by mid 2011. For the 12 months ended June 30, 2010, EBITDA coverage of interest was about 2x and total debt to EBITDA was 6.8x (excluding any effect of a put right by Steven Spielberg to the company). Per a consultant agreement, Spielberg is entitled to a certain percentage of park revenue and has the right to demand a one-time cash payment equal to the present value of the cash flow stream. The put right is exercisable in June 2017. The 'B' corporate credit rating reflects the strong competition between theme park operators in Orlando and the company's aggressive financial policy. Universal City is the second largest theme park operator in Orlando. It owns and operates two theme parks: Universal Studios Florida and Islands of Adventure, as well as City Walk (an entertainment and shopping complex). The company competes with five major theme parks within a 10-mile radius in the Orlando area, four of which belong to the Walt Disney Company. Walt Disney is by far the market leader, and competition between parks is fierce. Universal City's target market is families with children older than 10. This helps the company to differentiate itself slightly from Walt Disney, which is primarily focused on younger families. Over the past several years, Universal City has been attempting to transform itself into a multiday destination resort. However, its attractions have not been extensive enough to support sales of passes for longer than two days. Sale of one- and two-day passes accounts for about 57% of ticket revenues. The opening of The Wizarding World of Harry Potter, with its extensive themed area, could aid the transformation. UNIVISION COMMUNICATIONS: S&P Raises Corp. Credit Rating to 'B' --------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on New York City-based Univision Communications Inc. to 'B' from 'B-'. The rating was removed from CreditWatch, where it was placed with positive implications Oct. 5, 2010. The rating outlook is stable. S&P also raised the issue-level ratings on Univision's debt that were previously on CreditWatch by one notch in conjunction with the corporate credit rating upgrade. These ratings were subsequently removed from CreditWatch. The recovery ratings on the company's debt remain unchanged. "The rating upgrade reflects the successful extension of roughly $6.2 billion of senior secured credit facilities that was scheduled to mature in 2014, which in S&P's opinion helps to reduce refinancing risk and increase financial flexibility," noted Standard & Poor's credit analyst Michael Altberg. "The amendment, along with the company's agreement with Televisa, could help to make future refinancing more feasible." Univision pushed out the maturity of about $5.7 billion of its $7 billion term loan to March 2017 from September 2014. In addition, the company extended roughly $409 million of its revolving credit facility to March 2016 from March 2014, and termed out the remaining $137 million to March 2017. In exchange for the extension, pricing will increases by 200 basis points on both facilities, or roughly $124 million of additional interest expense per year -- an 18% increase over its current annual interest expense. S&P believes this increased interest expense is manageable given its expectation for continued moderate EBITDA growth over the intermediate term. In addition, the company recently completed an offering for $750 million of 7.875% senior secured notes due 2020, which was used to pay down senior secured term debt maturing in 2014. S&P expects Univision to use $1.1 billion of proceeds from the Televisa agreement to repay its senior toggle notes due 2015. According to terms of the amendment and extension, if on or prior to Jan. 29, 2015, the company has received the Televisa investment of $1.1 billion and used proceeds to repay the 2015 notes, the maturity extensions on the senior secured credit facilities will remain in place. Conversely, if the Televisa transaction hasn't taken place by Jan. 29, 2015, or the company hasn't been able to refinance the 2015 notes so that no more than $250 million remain outstanding, the maturities on the extended senior secured credit facilities will be shortened to Jan. 29, 2015. As a result, if S&P becomes convinced that the Televisa agreement will not be completed -- which in S&P's opinion could heighten refinancing risk -- S&P could lower the rating. The 'B' corporate credit rating reflects the company's steep debt leverage and weak interest coverage due to its 2007 leveraged buyout, advertising pricing that is not commensurate with its audience share, and weak trends in radio advertising, which remain under economic pressure and have been negatively affected by Arbitron's Portable People Meter rollout. Positive rating factors contributing to S&P's business risk profile assessment of satisfactory include Univision's position as the dominant U.S.- based Spanish-language TV and radio broadcaster, favorable long- term contracts to purchase popular TV programming, and positive trends in Spanish-language population and viewing. US DATAWORKS: Appoints Grant Thornton as New Independent Auditors ----------------------------------------------------------------- US Dataworks, Inc., announced Friday the appointment of Grant Thornton LLP, U.S. member firm of Grant Thornton International Ltd., as its independent registered public accounting firm for its fiscal year ended March 31, 2011. Prior to the selection of Grant Thornton, Ham, Langston & Brezina, LLP ("HLB") had served as the Company's independent registered public accounting firm. There have been no disagreements between the Company and HLB on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. Randall J. Frapart, the Company's CFO, commented, "Given our stage of growth and the foundation of our product initiatives, we see tremendous value in the resources and expertise that Grant Thornton can provide. Being associated with a firm of this caliber will benefit our shareholders, our customers and the Company alike. It is a privilege to engage Grant Thornton, and we look forward to a successful and long engagement." About US Dataworks Sugar Land, Tex.-based US Dataworks, Inc. (OTC BB: UDWK) -- http://www.usdataworks.com/-- provides enterprise payments solutions to financial institutions, billers and government entities. At June 30, 2010, the Company's balance sheet showed $5.67 million in total assets, $4.43 million in total liabilities, and shareholders' equity of $1.24 million. As reported in the Troubled Company Reporter October 11, 2010, Silicon Valley Bank ("SVB") has agreed, for the period beginning on September 30, 2010, and ending on October 13, 2010, to forbear from filing any legal action or instituting or enforcing any rights and remedies it may have against the Company arising out of the Company's failure to comply with certain financial covenants under the Loan Agreement and Subordination Agreement. US ONCOLOGY: Moody's Puts Ratings Under Review for Possible Raise ----------------------------------------------------------------- Moody's Investors Service affirmed the ratings of McKesson Corporation (Baa2/Prime-2) and its stable outlook following news that the company has signed a definitive agreement to acquire U.S. Oncology for approximately $2.16 billion. At the same time, Moody's is placing the ratings of U.S. Oncology Holdings, Inc. (CFR of B2) and U.S. Oncology, Inc., under review for possible upgrade. Moody's understands that McKesson plans to refinance the existing debt of U.S. Oncology, which will add about $1.7 billion of incremental debt to its balance sheet. Moody's anticipates that U.S. Oncology's existing ratings will be withdrawn if the debt is taken out. "Moody's believe the acquisition of U.S. Oncology will reduce McKesson's flexibility to engage in further acquisitions, but its financial strength measures should remain at levels appropriate for its Baa2 rating," said Diana Lee, a Moody's Senior Credit Officer. "This is among the largest acquisitions that McKesson has made in the recent past and comes on the heels of an accelerated buyback initiative," continued Ms. Lee. U.S. Oncology should offer McKesson greater opportunities to partner with community-based oncologists, augmenting its existing specialty distribution business. However, U.S. Oncology's EBITDA levels and margins have been under pressure in recent years as tougher ESA (erythropoietin-stimulating agent) prescribing guidelines for treating anemia in cancer patients continue to affect profitability. Moody's believe that the impact of further requirements or guidelines, including the potential for CMS to issue a national coverage decision on the use of ESAs is unknown at this time. McKesson's Baa2 rating reflects its position as one of the nation's leading drug distributors, but also considers extremely thin operating margins that remain subject to pressure from customers. Compared to its peers, however, McKesson does benefit from its higher margin technology solutions business, which accounts for about 15-20% of operating profits. The stable outlook reflects Moody's expectation that as McKesson takes on this incremental debt, it will sustain, at a minimum, financial strength ratios consistent with a Baa2 rating (including FCF/Debt of 20%). It further assumes that the company is likely to maintain leverage below the upper end of its 30-40% target reported Debt/Capitalization ratio. If future debt-financed acquisitions or buybacks result in leverage that is sustained at the high end of or above the company's targeted Debt/Capitalization ratio, financial strength measures fall below those consistent with a Baa2 rating, or margins show material deterioration, the ratings could be downgraded. In light of incremental debt, an upgrade is unlikely over the foreseeable future. Over time, if the company can sustain ongoing margin improvement, achieve greater balance across its various distribution and IT segments, as well as return to more moderate levels of acquisition and share buyback activity, the ratings could face upward pressure. Ratings affirmed: McKesson Corporation -- Baa2 senior unsecured notes -- Baa2 backed industrial revenue bonds -- (P)Baa2 senior unsecured shelf -- (P)Baa3 subordinated shelf -- (P)Baa3 senior subordinated shelf -- (P)Baa3 junior subordinated shelf -- (P)Ba1 preferred shelf -- Prime-2 short-term rating -- McKesson Canada Corporation -- Prime-2 short-term rating Ratings placed under review for possible upgrade: U.S. Oncology Holdings, Inc. -- B2 Corporate Family Rating -- B2 PDR -- Caa1 (LGD6, 90%) senior unsecured notes U.S. Oncology, Inc. -- Ba3 (LGD2, 27%) senior secured 2nd lien notes -- B3 (LGD5, 74%) senior subordinated notes The last rating action for McKesson was taken on June 21, 2010, when Moody's raised the company's long term and short term ratings to Baa2 and Prime-2, respectively. The last rating action for U.S. Oncology was taken on June 4, 2009, when Moody's assigned a Ba3 rating to the company's new second lien secured notes and upgraded the existing senior notes to Ba3. McKesson'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 McKesson's core industry and McKesson's ratings are believed to be comparable to those of other issuers of similar credit risk. McKesson Corporation, located in San Francisco, California, is a leading pharmaceutical drug distributor. Its information systems business provides software and hardware support to a large portion of the nation's hospitals. The company reported revenues of about $110 billion for the twelve months ended September 30, 2010. US AIRWAYS: Reports $250 Million Net Profit in Third Quarter ------------------------------------------------------------ US Airways Group, Inc. (NYSE: LCC) reported its third quarter financial results. On a GAAP basis, the Company reported a net profit of $240 million for its third quarter 2010, or $1.22 per diluted share, compared to a net loss of ($80) million, or ($0.60) per share, for the same period in 2009. The $240 million net profit is the highest third quarter net profit in the Company's history. Excluding special items of $3 million, net profit for the third quarter 2010 was $243 million, or $1.23 per diluted share. Net loss excluding special items for the third quarter 2009 was ($110) million, or ($0.83) per share. US Airways Group, Inc. Chairman and CEO Doug Parker stated, "Reporting a record third quarter profit speaks volumes about the efforts of our 31,000 team members. The past three years have been extremely challenging, and our response has been swift and decisive. We have returned US Airways to profitability and a leading position among our peers in financial and operational metrics by reducing capacity, realigning our network to focus on our primary assets, maintaining cost discipline, increasing ancillary revenues, and establishing industry-leading operational reliability. "We're particularly pleased with our team's continued dedication to customer service. US Airways' operation is running more efficiently than at any time in our company's history. The Company ranked first among the five largest network carriers in baggage handling for the months of July and August as measured by the U.S. Department of Transportation (DOT). This trend continued in September when we set an all-time Company record for baggage handling. "We are very proud of our team, and recently announced we will recall approximately 300 pilots and flight attendants from furlough status, which will supplement our international flying in 2011 and accommodate normal attrition. Upon exhausting our flight attendant furlough list later this year, we anticipate hiring new hire flight attendants in early 2011. Our third quarter results also include an accrual of $25 million for our profit sharing program, and $7 million for operational incentive payouts, bringing the total amount earned in 2010 through these programs to nearly $60 million." Revenue and Cost Comparisons A modestly improving economy and continued industry capacity discipline led to improved revenue performance. Total revenues in the third quarter were up 16.9 percent versus the third quarter of 2009 on a 1.6 percent increase in total available seat miles (ASMs). Total revenue per available seat mile was 13.90 cents, up 15.0 percent versus the same period last year driven by a 13.6 percent increase in passenger yields and an increase in passenger load factor from 82.6 percent to 83.1 percent. Outstanding operating reliability and continued cost diligence allowed the Company to keep costs in check despite rising fuel prices. Total operating expenses in the third quarter were up 5.6 percent over the same period last year due primarily to a 16.7 percent increase in fuel expense. Mainline cost per available seat mile (CASM) was 11.34 cents, up 3.1 percent. Excluding fuel and special items, mainline CASM was flat as compared to the same period last year at 8.06 cents, and excluding fuel, special items and profit sharing, mainline CASM actually decreased 1.6 percent to 7.93 cents. Express CASM excluding fuel was 13.32 cents, up 4.4 percent on a 1.5 percent decline in ASMs. Liquidity During the third quarter, the Company purchased approximately $69 million aggregate principal amount of its 7 percent senior convertible notes due 2020, at a price of $1,000 per $1,000 of principal amount. After giving effect to the purchase of the tendered notes, approximately $5 million principal amount of the notes remain outstanding. As of Sept. 30, 2010, the Company had approximately $2.4 billion in total cash and investments, of which $389 million was restricted, up from $2.0 billion of which $530 million was restricted on Sept. 30, 2009. Business Outlook Parker continued, "Looking forward, our plan is simple: Continue to take care of our customers by delivering superior operational results; maintain capacity discipline; aggressively manage our costs; and focus our assets in the markets that produce the best financial results for our airline." Other Notable Accomplishments * Announced daily, nonstop seasonal summer service from Charlotte Douglas International Airport to Madrid, Spain and to Dublin, Ireland, which will begin in May 2011. The new flights complement US Airways' daily, nonstop year- round service to both destinations from Philadelphia, the airline's international gateway. * Announced new service to seven cities and increased service to three existing markets from New York's LaGuardia Airport, effective Oct. 31. The new and expanded service will be operated by US Airways Express partners Air Wisconsin, Chautauqua Airlines, Piedmont Airlines, PSA Airlines and Republic Airways. * Announced a new bilateral codeshare agreement with Star Alliance partner, Turkish Airlines. US Airways customers will have access to Istanbul, Turkey via Turkish Airlines service from Frankfurt, Munich and Zurich and will gain access to four new destinations including Adana, Izmir, Antalya and Ankara, Turkey via Istanbul. Nonstop travel options to Istanbul are also available for US Airways customers via Turkish Airlines service at New York's John F. Kennedy International Airport and Chicago O'Hare International Airport. * Launched FastPathSM -- an expedited airport experience for customers traveling between Boston and Philadelphia. FastPath features dedicated facilities for curbside check-in and bag drop, ticket counter check-in, security checkpoint lanes, departure gates and baggage claim carousels. * Received distinction as one of the 50 best companies for Latinas by LATINA Style magazine for 2010. US Airways was the only airline included among the top 50 companies. Also during the quarter, the Company received distinction as one of "Best Places to Work" and earned a 100 percent rating on the Human Rights Campaign's Corporate Equality Index, which measures companies' attitudes and policies toward lesbian, gay, bisexual and transgender employees and customers. This is the sixth year in a row the airline has achieved a perfect score. Analyst Conference Call/Webcast Details An archive of the webcast of US Airways' earnings call held October 20, 2010, is available in the Public/Investor Relations portion of the carrier's Web site until Nov. 20, 2010. A full-text copy of US Airways' 3rd quarter 2010 financial results is available for free at: http://ResearchArchives.com/t/s?6cbe US Airways Group, Inc. Condensed Consolidated Balance Sheet As of September 30, 2010 Assets Current Assets Cash and cash equivalents $1,940,000,000 Accounts receivable, net 371,000,000 Materials and supplies, net 223,000,000 Prepaid expenses and other 538,000,000 --------------- Total current assets 3,072,000,000 Property and equipment Flight equipment 4,105,000,000 Ground property and equipment 824,000,000 Less: accumulated depreciation and amortization (1,250,000,000) --------------- 3,679,000,000 Equipment purchase deposits 91,000,000 --------------- Total property and equipment 3,770,000,000 Other assets Other intangibles, net 483,000,000 Restricted cash 389,000,000 Investments in marketable securities 59,000,000 Other assets, net 233,000,000 --------------- Total other assets 1,164,000,000 --------------- Total assets $8,006,000,000 =============== Liabilities and Stockholders' Equity (Deficit) Current liabilities Current maturities of debt and capital leases $441,000,000 Accounts payable 372,000,000 Air traffic liability 1,036,000,000 Accrued compensation and vacation 256,000,000 Accrued taxes 154,000,000 Other accrued expenses 790,000,000 --------------- Total current liabilities 3,049,000,000 Noncurrent liabilities and deferred credits Long-term debt and capital leases 3,987,000,000 Deferred gains and credits, net 342,000,000 Employee benefit liabilities and other 554,000,000 --------------- Total noncurrent liabilities and deferred credits 4,883,000,000 Stockholders' (equity) deficit Common stock 2,000,000 Additional paid-in capital 2,117,000,000 Accumulated other comprehensive income 34,000,000 Accumulated deficit (2,066,000,000) Treasury stock (13,000,000) --------------- Total stockholders' equity (deficit) 74,000,000 Total liabilities and stockholders' equity $8,006,000,000 =============== US Airways Group, Inc. Condensed Consolidated Statements of Operations For Three Months Ended September 30, 2010 Operating revenues: Mainline passenger $2,066,000,000 Express passenger 746,000,000 Cargo 37,000,000 Other 330,000,000 --------------- Total operating revenues 3,179,000,000 Operating expenses: Aircraft fuel and related taxes 625,000,000 Loss(gain) on fuel hedging instruments, net 0 Salaries and related costs 579,000,000 Express expenses 694,000,000 Aircraft rent 168,000,000 Aircraft maintenance 160,000,000 Other rent and landing fees 143,000,000 Selling expenses 118,000,000 Special items, net 3,000,000 Depreciation and amortization 65,000,000 Other 309,000,000 --------------- Total operating expenses 2,864,000,000 Operating Income 315,000,000 Non-operating income(expense): Interest income 2,000,000 Interest expense, net (83,000,000) Other, net 7,000,000 --------------- Total non-operating expense, net (74,000,000) --------------- Income (loss) before income taxes 241,000,000 Income tax provision 1,000,000 --------------- Net income (loss) $240,000,000 =============== US Airways Group, Inc. Condensed Consolidated Statement of Cash Flow For Nine Months Ended September 30, 2010 Net cash provided by operating activities $789,000,000 Cash flows from investing activities: Purchases of property and equipment (133,000,000) Purchases of marketable securities (180,000,000) Sales of marketable securities 268,000,000 Decrease in long-term restricted cash 91,000,000 Proceeds from sale-leaseback transactions 3,000,000 --------------- Net cash provided by investing activities 49,000,000 Cash flows from financing activities: Repayments of debt and capital lease oblig. (367,000,000) Proceeds from issuance of debt 120,000,000 Deferred financing costs (5,000,000) --------------- Net cash provided by financing activities (252,000,000) Net increase in cash and cash equivalents 586,000,000 Cash and cash equivalents at beginning period 1,299,000,000 --------------- Cash and cash equivalents at end of period $1,885,000,000 =============== Confidential Treatment of Exhibits Meanwhile, US Airways Group, Inc., and US Airways, Inc., submitted an application under Rule 24b-2 requesting confidential treatment for information they excluded from the Exhibits to a Form 10-K filed on February 17, 2010. Based on representations by US Airways Group, Inc., and US Airways, Inc., that this information qualifies as confidential commercial or financial information under the Freedom of Information Act, 5 U.S.C. 552(b)(4), the Division of Corporation Finance has determined not to publicly disclose it. Accordingly, excluded information from these exhibits will not be released to the public for the time period specified: Exhibit 10.93 through June 30, 2019 Exhibit 10.94 through June 30, 2019 Exhibit 10.95 through June 30, 2019 Exhibit 10.96 through June 30, 2019 Exhibit 10.97 through June 30, 2019 About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: Updates on Financial Outlook for 2010 ------------------------------------------------- US Airways Group, Inc., delivered to the U.S. Securities and Exchange Commission on October 20, 2010, a report updating its financial and operational outlook for 2010: * 2010 Capacity Guidance -- For 2010, total system capacity is expected to be up slightly. Mainline is forecast to be up approximately one percent, with domestic down approximately one percent and international up approximately eight percent. Express is expected to be down approximately one percent. * Cash -- As of September 30, 2010, the Company had approximately $2.4 billion in total cash and investments, of which $389 million was restricted. In addition, as of September 30, 2010, the Company's auction rate securities had a book value of $59 million ($93 million par value). While these securities are held as investments in non- current marketable securities on our balance sheet, they are included in the company's unrestricted cash calculation. * 7% Senior Convertible Notes -- Pursuant to the terms of the indenture governing the Company's 7% Senior convertible notes due 2020 and the Company's Put Right Purchase Offer to Holders of the Securities dated September 1, 2010, on September 30, 2010, the Company accepted for purchase all outstanding securities that were validly tendered and not withdrawn as of the expiration date. Approximately $68.7 million aggregate principal amount of the notes, representing approximately 93% of the aggregate principal amount of the outstanding notes prior to the Put Option, were validly tendered and accepted for purchase in the Put Option, at a price of $1,000 per $1,000 of principal amount. After giving effect to the purchase of the tendered notes, approximately $4.8 million principal amount of the notes remain outstanding. * Fuel -- For the fourth quarter 2010, the Company anticipates paying between $2.35 and $2.40 per gallon of mainline jet fuel (including taxes). * Profit Sharing/CASM -- Profit sharing equals 10% of pre-tax earnings excluding special items up to a 10% pre-tax margin and 15% above the 10% margin. Profit sharing is excluded in the CASM guidance. * Cargo/Other Revenue -- Cargo revenue, ticket change fees, excess/overweight baggage fees, first and second bag fees, contract services, simulator rental, airport clubs, Materials Services Company (MSC), and inflight service revenues. The Company's a la carte revenue initiatives are expected to generate in excess of $500 million in revenue in 2010. * Taxes/NOL -- As of December 31, 2009, net operating losses (NOL) available for use by the Company was approximately $2.1 billion, all of which is expected to be available for use in 2010. The Company's net deferred tax asset, which includes the NOL, is subject to a full valuation allowance. As of December 31, 2009, the valuation allowances associated with Federal and state NOL were $546 million and $77 million, respectively. In accordance with generally accepted accounting principles, future utilization of the NOL will result in a corresponding decrease in the valuation allowance and offset the Company's tax provision dollar for dollar. As a result, income tax benefits are not recognized in the Company's statement of operations. The Company reported pre-tax income for the nine months ended September 30, 2010, and utilized NOL to reduce its income tax obligation. However, the Company recorded $1 million of state income tax for the nine months ended September 30, 2010, related to certain states where NOL is either limited or not available to be used. For the full year 2010, the Company expects to be profitable and will use NOL to reduce its federal and state income tax obligation. The Company's full year state income tax obligation related to certain states where use of NOL is restricted is expected to approximate $1 million. The Company does not expect to be subject to AMT Liability in 2010 as a result of certain elections the Company made under the Worker, Homeownership, and Business Assistance Act of 2009. A full-text copy of the investor relations update is available for free at http://ResearchArchives.com/t/s?6cbf About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: Wants B. Mitchell Adversary Proceeding Stayed --------------------------------------------------------- US Airways, Inc., and Ben Mitchell, et al., ask the U.S. District Court for the District of Massachusetts to stay an adversary Proceeding between them pending a decision by the United States Court of Appeals for the First Circuit in DiFiore et al. v. American Airlines Inc. et al. The parties maintain that a temporary stay until the DiFiore Case is decided will preserve judicial resources and provide necessary guidance to themselves as to the viability of many of the claims in the lawsuit. In the Adversary Proceeding, Mr. Mitchell, et al., allege, among other things, that US Airways' imposition of a $2 fee for baggage checked curbside by skycaps violates the Massachusetts Tip Statute and constitutes tortious interference and unjust enrichment in violation of the states' common law. Similar allegations were made against American Airlines in DiFiore. The parties in DiFiore have filed cross-appeals on several issues, including the preemptive effect of the Airline Deregulation Act. "Because ADA preemption is also an important issue in the present case, and could impact the scope of the case significantly depending on the First Circuit's ruling, it would benefit the Court and the Parties to await that ruling before further litigating this matter," says Jeffrey M. Rosin, Esq., at Constangy, Brooks & Smith, LLP, in Boston, Massachusetts, counsel for US Airways. According to Mr. Rosin, the Court recently issued a stay in a similar case styled Brown et al. v. United Air Lines, Inc., which presented the same issue of ADA preemption. About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. VAN CHASE: U.S. Trustee Unable to Form Creditors Committee ---------------------------------------------------------- Charles F. McVay, the U.S. Trustee for Region 19, notified the U.S. Bankruptcy Court for the District of Colorado that he was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of Van Chase, LLC. The U.S. Trustee explains that there were too few unsecured creditors who are willing to serve on a creditors committee. Aspen, Colorado-based Van Chase, LLC, filed for Chapter 11 bankruptcy protection on August 24, 2010 (Bankr. D. Colo. Case No. 10-31555). John D. LaSalle, Esq., who has an office in Aspen, Colorado, assists the Debtor in its restructuring effort. According to its schedules, the Debtor disclosed $26,528,200 in total assets and $15,150,964 in total liabilities as of the petition date. VERTIS HOLDINGS: Amends Terms for Comprehensive Recapitalization ---------------------------------------------------------------- Vertis Holdings, Inc. has amended the terms of its previously announced exchange offers and taken additional steps to complete the comprehensive refinancing of substantially all of its outstanding secured and unsecured debt. Upon completion of the refinancing, the Company will substantially reduce its overall debt and interest costs as well as increase liquidity and further strengthen its capital structure. The refinancing will better position the Company for long-term growth by giving it the financial flexibility to make additional investments and to continue aligning the business with evolving marketplace trends and clients' needs. Under the terms outlined in the Confidential Offering Memorandum, Consent Solicitation, Private Placement and Disclosure Statement Soliciting Acceptances of a Prepackaged Plan of Reorganization dated November 1, 2010 released to note holders today, holders of Vertis' Senior Pay-in-Kind Notes due 2014 and Senior Secured Second Lien Notes due 2012 are being offered the opportunity to exchange their existing debt for equity only, as compared to previous offers of cash, new senior secured notes and equity. Assuming successful completion of the refinancing, Vertis will reduce its total debt by more than $700 million, or approximately 60 percent, and allow it to compete more effectively in the industry. Vertis also announced that it has secured commitments for $600 million of debt and expects to have approximately $500 million of debt outstanding upon completion of the refinancing. GE Capital has committed to provide a $175 million Revolving Credit Facility and Morgan Stanley Senior Funding, Inc. has committed to provide a $425 million Term Loan. Additionally, eligible Second Lien Note holders will have the opportunity to acquire up to $100 million in additional Vertis equity, the proceeds of which would be used to further reduce the Company's debt. Certain of such holders have agreed to purchase their allocated share of the equity, plus any such equity not purchased by other holders. Holders of approximately 80% of the Second Lien Note and approximately 68% of the Senior PIK Notes have signed a restructuring support agreement under which they agree to the terms of the Exchange Offers. Lastly, Vertis has developed an alternate path to ensure the refinancing is completed on a timely basis. Concurrent with the solicitation of the Exchange Offers, Vertis is soliciting acceptances of a pre-packaged Chapter 11 reorganization plan. If Vertis does not obtain acceptable participation in the Exchange Offers from its Senior PIK Note holders and Second Lien Note holders, but does obtain the necessary acceptances for the Plan of Reorganization -- a lower voting threshold -- Vertis intends to begin Chapter 11 proceedings to complete the refinancing. Holders of approximately 80% of the Second Lien Notes and approximately 68% of the Senior PIK Notes have already signed a restructuring support agreement under which they agree to vote in favor of the Plan of Reorganization. These holders of Second Lien Notes include Vertis' largest stockholder, Avenue Capital, plus 75.9% of the non-Avenue Capital holders of Second Lien Notes. Vertis would file a voluntary pre-packaged Chapter 11 petition only if it concludes that a court-supervised process is the most efficient means to successfully complete the recapitalization while protecting its stakeholders' long-term interests. The GE Capital and Morgan Stanley Senior Funding, Inc. commitments will allow the Company to enter the process with funding in place to complete the reorganization within 45 to 60 days of filing and emerge as a well-capitalized company. The plan of reorganization contemplates that the Company will honor in full all commitments to employees, clients, suppliers and other business partners, without disruption. The Exchange Offers Under the terms of the Exchange Offers, for each $1,000 principal amount of Second Lien Notes validly tendered, and not validly withdrawn, by eligible holders in the exchange offer relating to the Second Lien Notes at or prior to 12:00 a.m. on December 1, 2010, unless extended by Vertis, such holders will receive 8.49 shares of Holdings' common stock per $1,000 principal amount of Series A Second Lien Notes, 8.49 shares of New Common Stock per $1,000 principal amount of Series B Second Lien Notes and 8.065 shares of New Common Stock per $1,000 principal amount of Series C Second Lien Notes. For each $1,000 principal amount of Senior PIK Notes validly tendered, and not validly withdrawn, by eligible holders in the exchange offer relating to the Senior PIK Notes at or prior to the Expiration Time, such holders will receive 2.46 shares of New Common Stock. The issuance of New Common Stock according to the above referenced exchange ratios give effect to a contemplated 60,111 to 1 reverse stock split. If the Exchange Offers are consummated, eligible holders of Second Lien Notes will receive a consent payment of $2.50 for each $1,000 principal amount of Second Lien Notes validly tendered in the Second Lien Notes Offer, and not validly withdrawn, at or prior to 5 p.m., New York City time, on November 15, 2010. Eligible holders of Senior PIK Notes will receive an additional 0.82 shares of New Common Stock for each $1,000 principal amount of Senior PIK Notes validly tendered in the Senior PIK Notes Offer, and not validly withdrawn, at or prior to the Consent Time. Assuming successful completion of the Exchange Offers, we will issue to participating eligible holders of Senior PIK Notes New Common Stock representing approximately 5% of Vertis's equity in the aggregate. Vertis is also soliciting consents from eligible holders for certain amendments to the indentures governing the Notes to eliminate substantially all of the restrictive covenants and certain events of default and related provisions contained therein and, with respect to the indenture governing the Second Lien Notes, provide for the release of all of the liens on the collateral securing the Second Lien Notes and the related guarantees, including by amending the Second Lien Indenture and by terminating or amending, as applicable, the related security documents. Eligible holders who validly tender their Notes for exchange pursuant to the Exchange Offers will be deemed to have delivered a Consent with respect to such tendered Notes. Tendered Notes may not be withdrawn after the Consent Time. In connection with the Exchange Offers and the Private Placement, Vertis has secured new financing arrangements, including a new asset-based revolving credit facility of up to $175.0 million aggregate principal amount and a new senior secured term loan of up to $425.0 million in aggregate principal amount (the "New Term Loan" and, together with the New Revolving Credit Facility, the "New Credit Facilities" and, together with the Exchange Offers, the Consent Solicitation and the Private Placement, the "Restructuring Transactions"). The proceeds of the New Credit Facilities will be used, among other things, to repay all of our obligations under Vertis' existing revolving credit facility and term loan. The consummation of the Exchange Offers is conditioned upon, among other things, (i) eligible holders of at least 98% of the aggregate principal amount of Senior PIK Notes validly tendering their Senior PIK Notes in the Senior PIK Notes Offer at or prior to the Expiration Time (the "Senior PIK Minimum Condition"), (ii) eligible holders of at least 98% of the aggregate principal amount of Second Lien Notes validly tendering their Second Lien Notes in the Second Lien Notes Offer at or prior to the Expiration Time (the "Second Lien Minimum Condition" and, together with the Senior PIK Minimum Condition, the "Minimum Conditions"), (iii) Vertis' entry into new bank loans and the extinguishment of its existing term loan and credit facility and the consummation of the Private Placement, including the Backstop (each as hereinafter defined), (iv) the adoption and effectiveness of proposed amendments to Holdings' Second Amended and Restated Certificate of Incorporation (the "Certificate of Incorporation") to effect a 60,111 to 1 reverse stock split (the "Reverse Stock Split") substantially concurrent with the Expiration Time; (v) the adoption and effectiveness of proposed amendments to the Certificate of Incorporation to increase Holdings' authorized common stock to 40,000,000 shares substantially concurrent with the Expiration Time, (vi) the termination of the existing stockholders' agreement among Vertis and certain of its stockholders thereto and (vii) the issuance of New Common Stock in the Exchange Offers and the Private Placement to eligible holders not resulting in the record number of holders of Holdings' common stock exceeding 450, a violation of Holdings' Certificate of Incorporation. Vertis may waive or amend any of these conditions in its sole discretion, including the Minimum Conditions, and under certain circumstances may do so without providing additional withdrawal rights. If Vertis does not satisfy the conditions noted above, it may allow the Exchange Offers to expire or terminate the Exchange Offers prior to the Expiration Time and seek to effectuate the Plan of Reorganization. The Private Placement Concurrently with the Exchange Offers and Consent Solicitation, Vertis is also offering eligible holders who tender Second Lien Notes in the Second Lien Notes Offer the opportunity to purchase up to an aggregate of 10,000,000 shares of New Common Stock, which Offered Amount may be reduced by up to 20 percent prior to the Expiration Time in Vertis' sole discretion. Each eligible holder shall be permitted to subscribe for 20.245 shares of New Common Stock per $1,000 principal amount of its Series A Second Lien Notes, 20.245 shares of New Common Stock per $1,000 principal amount of its Series B Second Lien Notes and 19.233 shares of New Common Stock per $1,000 principal amount of its Series C Second Lien Notes, in each case at a subscription price per share of $10.00. Each eligible holder participating in the Private Placement may subscribe for some, all or none of the New Common Stock it is eligible to purchase in the Private Placement. Any subscription by an eligible holder for New Common Stock in the Private Placement is subject to and conditioned upon, among other things, the valid tender by such holder of its Second Lien Notes in the Second Lien Notes Offer at or prior to the Expiration Time and the acceptance by Vertis of such tendered Second Lien Notes or, if the Exchange Offers are not consummated, the confirmation of the Plan of Reorganization. Pursuant to an agreement among Vertis and certain holders of Second Lien Notes, the Backstop Investors have agreed to fully participate in the Private Placement as well as purchase any shares of New Common Stock not purchased by holders of Notes who are not Backstop Investors at the Subscription Price. The Backstop Investors will receive an aggregate fee of 1,661,518 shares of New Common Stock in connection with the Backstop. The consummation of the Private Placement is conditioned upon the substantially concurrent consummation of the Exchange Offers or the confirmation of the Plan of Reorganization, as applicable. The Reverse Stock Split is a condition of the Exchange Offers and any shares of the New Common Stock issued in the Exchange Offers and Private Placement will be issued following the Reverse Stock Split. In addition, following the consummation of the Exchange Offers or the Plan of Reorganization, Vertis expects to implement a management incentive plan providing for the issuance of up to 10% of the outstanding New Common Stock on a fully diluted basis. Each eligible holder of Notes receiving New Common Stock in the Exchange Offers and the Private Placement and any subsequent transferee of such New Common Stock will be deemed to be a party to the new stockholders' agreement among Vertis and its stockholders. Timetable The Exchange Offers will expire at 12:00 a.m., New York City time, on December 1, 2010, unless extended by Vertis. The Exchange Offers are subject to the terms and conditions set forth in the Offering Memorandum and Disclosure Statement and the related letter of transmittal, each dated November 1, 2010. Solicitation for Potential Voluntary Pre-Packaged Chapter 11 Reorganization Concurrently with the Exchange Offers, Vertis is soliciting votes on its Plan of Reorganization. Vertis has made no decision at this time to commence chapter 11 proceedings. However, if it does not obtain acceptable levels of participation in the Exchange Offers, but does receive sufficient acceptances of its Plan of Reorganization, Vertis will pursue its restructuring in chapter 11. A chapter 11 plan of reorganization can be confirmed if either the holders of the Second Lien Notes or the Senior PIK Notes vote to accept the plan, not including the votes of affiliates. A class of creditors is deemed to accept a chapter 11 plan if at least one-half in number of the creditors within the class, who hold at least two-thirds in dollar amount of claims in the class, vote to accept the plan, counting only those who actually vote. Dissenting and abstaining creditors will be bound by the terms of the plan if this voting threshold is met. The proposed economic terms of the Plan of Reorganization are substantially similar to the proposed economic terms of the Exchange Offers. In particular, holders of Second Lien Notes will be entitled to their pro rata share of 96.25% of the equity in reorganized Vertis, subject to dilution on account of equity distributed by reorganized Vertis in exchange for the investment of up to $100 million described above. Holders of Senior PIK Notes will be entitled to their pro rata share of 3.75% of the equity in reorganized Vertis, subject to the same dilution. Existing equity interests in Vertis will be cancelled. All other creditors will be left unimpaired under the plan. Accordingly, under the plan, all obligations to suppliers, vendors, clients, and employees will be paid in full in the ordinary course of business. If Vertis files chapter 11 pursuant to the plan, it will request immediate authority to honor such obligations without delay or disruption. As noted above, the Expiration Time for the Exchange Offers is 12:00 a.m. on December 1, 2010. The deadline for casting votes on the Plan of Reorganization is the same date. However, Vertis will assess voting results as of the Consent Time. Based on that assessment, it is possible that Vertis could choose to commence chapter 11 proceedings prior to the Expiration Time in order to pursue confirmation of the Plan of Reorganization. If it does so, the voting deadline would stay open until the Expiration Time, and Vertis would utilize votes cast both pre-filing and post-filing in calculating whether the plan has been accepted. About Vertis Headquartered in Baltimore, Maryland, Vertis Holdings, Inc. -- http://www.vertisinc.com/-- provides targeted print advertising and direct marketing solutions to America's retail and consumer services companies. Vertis Holdings' Vertis Inc. and its subsidiaries disclosed that as of June 30, 2010, it had $1,467,320,000 in total assets, including $257,193,000 in cash and cash equivalents; and $1,493,277,000 in total liabilities, including $265,734,000 in total current liabilities, and a stockholders' deficit of $25,957,000. The company and its six affiliates previously filed for Chapter 11 protection on July 15, 2008 (Bankr. D. Del. Case No. 08-11460). In August 2008, it emerged from bankruptcy, after completing a merger with ACG Holdings. * * * As reported by the Troubled Company Reporter on April 27, 2010, Moody's Investors Service assigned Vertis, Inc., a Caa1 Corporate Family Rating, Caa1 Probability of Default Rating and SGL-3 Speculative Grade Liquidity rating. Moody's said Vertis' Caa1 CFR reflects the company's high leverage, thin coverage of total interest costs, and long-term price and volume pressure on the print-based advertising and direct marketing products and services that comprise the majority of the company's revenue. Moody's noted Vertis' proposed refinancing transactions would be a second restructuring closely on the heels of Vertis' 2008 bankruptcy reorganization. VINEYARD CHRISTIAN: Ch. 11 Trustee Wants Case Converted to Ch. 7 ---------------------------------------------------------------- Jeffrey I. Golden, the Chapter 11 trustee in the reorganization case of Vineyard Christian Fellowship of Malibu, asks the U.S. Bankruptcy Court for the Central District of California to convert the Debtor's Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. The trustee determined that the best possible outcome for the case was the sale of many assets as possible as a going concern after considering his investigation into the Debtor's assets, and the value going concern and liquidation basis, and his determination that the Debtor's business could not be rehabilitated and reorganized. The Ch. 11 Trustee said that the conversion of the Debtor's case will provide efficient administration of the Debtor's remaining assets. About Vineyard Christian Fellowship of Malibu Malibu, California-based Vineyard Christian Fellowship of Malibu owns real property in Malibu, California, on which it operates a multi-purpose office building and recording studio. The Company filed for Chapter 11 protection on September 12, 2008 (Bankr. C.D. Calif. Case No. 08-16951). Attorneys at Weiland, Golden, Smiley, Wang Ekvall & Strok, LLP, represent the Chapter 11 trustee as counsel. The Debtor disclosed assets of $34,344,046 and debts of $18,670,082 as of the Petition Date. On July 9, 2009, the Trustee filed his first Interim Report, which provides an overview of the activities that the Trustee and his team of professionals have engaged in during the period December 11, 2008 through June 30, 2009. The Trustee will file future interim reports every six months and will provide updates on his activities as appropriate. VITRO SAB: To File for Bankr. in Mexico, Chapter 15 in U.S. ----------------------------------------------------------- Jonathan J. Levin and Andres R. Martinez at Bloomberg News report that Vitro, S.A.B. de C.V offered to buy back or swap US$1.2 billion in debt from bondholders as the company prepares to seek bankruptcy protection before the end of the year. The report notes that the bonds jumped and shares climbed to the highest in more than two years. According to the report, Chief Restructuring Officer Claudio del Valle will file for bankruptcy in Mexico and under Chapter 15 in the U.S. within the next two months. The report says that debt holders may get as much as 73 cents on the dollar under the terms proposed on November 2, 2010. "We're aiming to bring the maximum number of participants into the process," Bloomberg quoted Mr. del Valle as saying. "This will help to make the process as fast, as expedient as possible." Vitro SAB, the report notes, is overhauling its operations and financing after it defaulted on US$1.2 billion of debt last year following wrong-way bets on derivates tied to natural gas and the Mexican peso that cost the company US$240 million. The glassmaker previously made at least three unsuccessful restructuring proposals to creditors, Bloomberg says. Bloomberg discloses that holders of defaulted bonds due in 2012, 2013 and 2017 have until Dec. 1 to accept the buy back or swap offer. They can take cash, new debt or convertible bonds in the exchange, the report relates. Last month, the report notes, debt holder Fintech Investments Ltd., a hedge fund, agreed to an option that gives it the right to purchase shares in the glassmaker once the restructuring is complete. The report relates Vitro SAB said that Fintech, which loaned Vitro US$75 million in December, would own 24% of the outstanding shares if it exercises the agreement. The Mexican company has the right to buy those shares back within three years, Bloomberg adds. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. * * * In June 2010, Fitch Ratings withdrew all ratings of Vitro, S.A.B. de C.V., given the lack of information following the company's default on Feb. 2, 2009, and consistent with Fitch's policies. Fitch will no longer provide ratings or credit research on the Company. Andres R. Martinez at Bloomberg News said in June that Vitro was suspended from trading in Mexico City after failing to file its fourth-quarter earnings report. The company missed the June 2 deadline for the results, Mexico's stock exchange said in an e-mailed statement obtained by the news agency. Vitro plans to file the report once its debt restructuring is complete or if ordered by a judge. Vitro said that the suspension won't affect company operations. On June 30, 2009, Galaz, Yamazaki, Ruiz Urquiza, S.C., member of Deloitte Touche Tohmatsu and C.P.C. Jorge Alberto Villarreal in Monterrey, N.L., Mexico raised substantial doubt about the Company's ability to continue as a going concern after auditing financial results for the period ended Dec. 31, 2007, and 2008. The auditors pointed out to the Company's net loss and its non- compliance with covenants related to its long-term debt obligations. WILLARD FRAZIER: Case Summary & 18 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Willard H. Frazier aka Willard H. Frazier, Jr. 40 Lupine Hill Road Napa, CA 94558 Bankruptcy Case No.: 10-14148 Chapter 11 Petition Date: October 28, 2010 Court: U.S. Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: Michael C. Fallon, Esq. LAW OFFICES OF MICHAEL C. FALLON 100 E. Street, #219 Santa Rosa, CA 95404 Tel: (707) 546-6770 E-mail: mcfallon@fallonlaw.net Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 18 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-14148.pdf WILMINGTON TRUST: S&P Puts 'BB+/B' Rating on Watch Positive ----------------------------------------------------------- Standard & Poor's Ratings Services said it placed its 'BB+/B' long-term counterparty rating on Wilmington Trust Corp. and the `BBB-/A-3' long-term counterparty credit rating on Wilmington's main bank subsidiary, Wilmington Trust Co., DE on CreditWatch with positive implications. The positive CreditWatch action follows Wilmington's announcement that it will be acquired by higher-rated M&T Bank Corp. (A- /Negative/A-2). In this $351 million stock transaction, M&T will assume all of Wilmington's assets and liabilities. The merger would result in $79 billion institution with 790 branches operating across the mid-Atlantic region. S&P said it affirmed its 'A-/A-2' ratings on M&T Bank Corp. and its 'A/A-1' ratings on subsidiary Manufacturers & Traders Trust Co. The outlook on both entities remains negative. The companies said they plan to close the transaction by mid-year 2011. Both boards of directors have approved the merger, and its completion is subject to regulatory approval and approval by Wilmington's shareholders. S&P believes that there is a very high likelihood that the companies will complete the merger. Wilmington sought an acquisition in conjunction with recognizing a further sharp increase in non-performing assets, mainly in its construction loan portfolio. This drove a very large third- quarter loss and a significant erosion of its tangible common equity. Aside from its distressed loan portfolio, Wilmington has a leading retail branch network in Delaware and well-established corporate trust and wealth management advisory businesses, which S&P believes will further strengthen M&T's franchise. Through the addition of Wilmington's sizable Delaware retail branch network, M&T will also deepen its market position in Delaware and the wider mid-Atlantic region. M&T's management has a track record of successfully integrating acquisitions, and S&P expects it to have little difficulty in integrating Wilmington's organization. Since the networks of the two organizations are largely complementary, M&T is already familiar with Wilmington's markets. Wilmington's financial condition has been weak as a result of serious asset quality problems, mainly in its construction portfolio, with total nonperforming assets reaching a high 12.1% at Sept. 30, 2010. Under the terms of the pending deal, M&T will take a $500 million fair value adjustment to Wilmington's portfolio, following $500 million in write-downs before the merger closes. S&P believes this adjustment will be sufficient to insulate M&T from continuing losses in the portfolio. Despite solid improvement in capital measures over the past year, S&P continues to view M&T's capital position as somewhat aggressive relative to peers. S&P expects this deal to have a minimal impact on M&T's tangible capital levels at the time of its close, and that M&T will maintain its current tangible capital levels. The outlook remains negative. Although S&P does not expect any material negative impact from the acquisition of Wilmington, S&P does expect M&T will continue to undergo normal cyclical weakness in its legacy portfolio. If performance remains positive relative to peers and capital is strengthened, S&P could revise the outlook to stable. If credit losses rise materially or capital falls below current levels, S&P could lower the ratings. S&P will likely equalize Wilmington's ratings with those of M&T at or close to when the acquisition is complete. In the highly unlikely event that the acquisition is not completed, then S&P would likely downgrade Wilmington's ratings by several notches. Ratings List Ratings Placed On CreditWatch Positive Wilmington Trust Corp. To From -- ---- Counterparty Credit Rating BB+/Watch Pos/B BB+/Negative/B Subordinated BB-/Watch Pos BB- Wilmington Trust Co., DE To From -- ---- Counterparty Credit Rating BBB-/Watch Pos BBB-/Negative/A-3 Certificate Of Deposit Local Currency BBB-/A-3/Watch Pos BBB-/A-3 Wilmington Trust Capital A To From -- ---- Preferred Stock B-/Watch Pos B- ZIONS BANCORP: Moody's Downgrades Bank Deposit Rating to Ba3 ------------------------------------------------------------ Moody's Investors Service announced that it has downgraded the ratings of 10 large U.S. regional banks after reducing its government support assumptions for these entities. The affected entities, whose ratings were placed on review for possible downgrade on July 27, 2010, had benefited from Moody's support assumptions since 2009. The banks affected by this action are subsidiaries of these 10 holding companies, listed alphabetically. This list includes the current bank-level deposit ratings following the removal of support. * BB&T Corporation -- bank deposits to Aa3 from Aa2 * Capital One Financial Corporation -- bank deposits to A3 from A2 * Fifth Third Bancorp -- bank deposits to A3 from A2 * KeyCorp -- bank deposits to A3 from A2 * PNC Financial Services Group, Inc. -- bank deposits to A2 from A1 * Popular, Inc. -- bank deposits to Baa3 from Baa2 * Regions Financial Corporation -- bank deposits to Baa3 from Baa1 * SunTrust Banks, Inc. -- bank deposits to A3 from A2 * U.S. Bancorp -- bank deposits to Aa2 from Aa1 * Zions Bancorporation -- bank deposits to Ba3 from Ba2 Additionally, as a result of the reduced support assumptions, the ratings outlook on the subsidiaries of American Express Company was changed. These issuers' guaranteed debt obligations issued under the FDIC's TLGP program were unaffected by the actions and remain Aaa. Rating Rationale "The downgrades reflect Moody's view that the likelihood of government support for these 10 institutions is lower now that the U.S. banking system has moved beyond the depths of the financial crisis," said Robert Young, Managing Director for Moody's North American Bank Ratings. "The failure of any one of these banks therefore would be unlikely to trigger contagion and systemic risk." In passing the Dodd-Frank Wall Street Reform and Consumer Protection Act this summer, the government signaled its intent to limit support for individual banks. This contrasts with its stance in early 2009, when it stated that support would be forthcoming for large regional banks that could not raise sufficient capital to satisfy government requirements under the Supervisory Capital Assessment Program. In reviewing its support assumptions, Moody's took into account the government's existing TARP investments in six large regional banks (Fifth Third, KeyCorp, Popular, Regions, SunTrust, and Zions). "Although the TARP investments are significant, all of these banks are currently devising plans to repay the government and are unlikely to keep the TARP in place over the long term," Young noted. The probability that the government would support any one of these institutions through a TARP conversion is therefore limited. Specific Bank Actions Differ BB&T: Moody's removed its assumption of support and placed BB&T's long-term ratings on review for further downgrade. During its review of BB&T's stand-alone credit strength, Moody's will focus on BB&T's ability to maintain its core pre-provision, pre-tax earnings in a still-challenging environment for U.S. banks, while assessing the risks associated with its above-average loan growth outside of commercial real estate as it shifts its portfolio away from that troubled asset class. Moody's will also consider the likely pace of further reductions in BB&T's sizable portfolio of foreclosed properties. In the event of a downgrade, a one-notch reduction is most likely. Were this to occur, BB&T's ratings would remain comparatively high, particularly among its Southeastern and large regional bank peers. Its senior holding company obligations are currently rated A1 and its long-term bank deposits (after the removal of systemic support) are rated Aa3. BB&T's Prime-1 short-term ratings, at both the bank and the holding company, are affirmed and are not on review. SunTrust: The downgrade resulting from the removal of systemic support assumptions was tempered by Moody's upgrade of SunTrust's stand-alone bank financial strength rating to C from C-. The combination of these two actions resulted in most of the holding company's ratings being confirmed (senior debt, Baa1), except for the preferred stock ratings, which were notched off the BFSR and were therefore upgraded with the BFSR (non-cumulative preferred to Ba1 from Ba2). However, the combination of the removal of systemic support assumptions and the upgrade of the BFSR did lead to a one-notch downgrade of the ratings on SunTrust Bank (long- term deposit rating to A3 from A2; short-term rating to Prime-2 from Prime-1). Following these rating actions, the outlook on all of SunTrust's ratings is stable. Regions: The removal of support assumptions resulted in a two- notch downgrade of Regions' bank-level debt and deposit ratings (long-term deposit rating to Baa3 from Baa1; short-term rating to Prime-3 from Prime-2) and a one-notch downgrade of the holding company's ratings (senior debt to Ba1 from Baa3; short-term rating to Not-Prime from Prime-3). Following these actions, the outlook on all of Regions' ratings remains negative. Capital One, Fifth Third, KeyCorp, Zions: The removal of support assumptions resulted in a one-notch downgrade of these four banks' bank-level debt and deposit ratings, but did not affect any of the holding companies' ratings, which were not on review. PNC, Popular, U.S. Bancorp: Moody's continues to ascribe support in the case of these three banks, but at a reduced level. The reduction in the support assumption resulted in a one-notch downgrade of these banks' bank-level debt and deposit ratings. The ratings of these entities' holding companies were not on review and were affirmed at their current level. While the lower probability of support does not provide any lift to their current stand-alone ratings, at a lower stand-alone rating some ratings lift might result. The ongoing assumption of support for US Bancorp and PNC is due primarily to their importance in the payment system and their significant national deposit share. The support assumption for Popular reflects its dominant position in Puerto Rico, together with that island's physical isolation and political importance. Rating Outlooks The rating outlook on four of these banks did not change. The outlook on Regions, Popular, and U.S. Bancorp remains negative, while that on Zions remains positive. However, the ratings outlook on six of the banks did change. On Capital One, Fifth Third, and KeyCorp it was changed to stable from negative; on PNC it was changed to positive from stable; and on SunTrust it was changed to stable after the upgrade discussed above. "These outlook changes reflect the banks' improving credit metrics and strengthened capital profiles relative to Moody's previous expectations, particularly at PNC and SunTrust," said Allen Tischler, Moody's Vice President and Lead Analyst for Fifth Third, KeyCorp, SunTrust, and PNC. Finally, the rating outlook on American Express Company's subsidiaries was changed to negative from stable as a result of the removal of the support assumption. The last rating action on BB&T Corporation, Capital One Financial Corporation, Fifth Third Bancorp, KeyCorp, PNC Financial Services Group, Inc., Popular, Inc., Regions Financial Corporation, SunTrust Banks, Inc., and U.S. Bancorp was on July 27, 2010, when Moody's placed on review for possible downgrade all the ratings that had benefited from systemic support at these banks. The last rating action on Zions Bancorporation and its subsidiaries was on August 3, 2010, when Moody's changed the rating outlook on the unsupported ratings of Zions Bancorporation and its subsidiaries to positive from negative, including those of its lead bank, Zions First National Bank. The last rating action on American Express Company was on February 17, 2010, when Moody's downgraded the ratings on certain U.S. banks' hybrid securities, in line with its revised Guidelines for Rating Bank Hybrids and Subordinated Debt, published in November 2009. Downgrades: Issuer: BB&T Financial, FSB -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: Banco Popular de Puerto Rico -- Issuer Rating, Downgraded to Baa3 from Baa2 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa2 Issuer: Branch Banking and Trust Company -- Issuer Rating, Downgraded to Aa3 from Aa2 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa3 from Aa2 -- Multiple Seniority Bank Note Program, Downgraded to a range of A1 to Aa3 from a range of Aa3 to Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to A1 from Aa3 -- Senior Unsecured Deposit Rating, Downgraded to Aa3 from Aa2 Issuer: SunTrust Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3 from a range of (P)P-1, (P)A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Fifth Third Bank, Ohio -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to P-2 from P- 1 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: KeyBank National Association -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of Baa1 to P-2 from a range of A3 to P-1 -- Multiple Seniority Medium-Term Note Program, Downgraded to a range of (P)P-2, (P)A3, (P)Baa1 from a range of (P)P-1, (P)A2, (P)A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Bank Note Program, Downgraded to a range of A3 to P-2 from a range of A2 to P-1 -- Senior Unsecured Deposit Program, Downgraded to P-2, A3 from P-1, A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: National City Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 Issuer: National City Bank of Indiana -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Kentucky -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: National City Bank of Pennsylvania -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: PNC Bank, N.A. -- Issuer Rating, Downgraded to A2 from A1 -- OSO Senior Unsecured OSO Rating, Downgraded to A2 from A1 -- Multiple Seniority Bank Note Program, Downgraded to a range of A2, A3 from a range of A1, A2 -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Bank Note Program, Downgraded to A2 from A1 -- Senior Unsecured Medium-Term Note Program, Downgraded to (P)A2 from (P)A1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A2 from A1 -- Senior Unsecured Deposit Rating, Downgraded to A2 from A1 Issuer: Provident Bank -- Subordinate Regular Bond/Debenture, Downgraded to A3 from A2 Issuer: U.S. Bank National Association -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Aa2, Aa3 from a range of Aa1, Aa2 -- Subordinate Regular Bond/Debenture, Downgraded to Aa3 from Aa2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: U.S. Bank National Association ND -- Issuer Rating, Downgraded to Aa2 from Aa1 -- OSO Senior Unsecured OSO Rating, Downgraded to Aa2 from Aa1 -- Senior Unsecured Deposit Rating, Downgraded to Aa2 from Aa1 Issuer: Capital One Bank -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Multiple Seniority Bank Note Program, Downgraded to a range of P-2, A3, Baa1 from a range of P-1, A2, A3 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Note/Takedown, Downgraded to A3 from A2 -- Senior Unsecured Regular Bond/Debenture, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Capital One, N.A. -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Senior Unsecured Deposit Program, Downgraded to A3 from A2 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: AmSouth Bancorporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 Issuer: AmSouth Bank -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Regions Bank -- Issuer Rating, Downgraded to Baa3 from Baa1 -- OSO Rating, Downgraded to P-3 from P-2 -- Deposit Rating, Downgraded to P-3 from P-2 -- OSO Senior Unsecured OSO Rating, Downgraded to Baa3 from Baa1 -- Multiple Seniority Bank Note Program, Downgraded to a range of Ba1 to P-3 from a range of Baa2 to P-2 -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 -- Senior Unsecured Deposit Rating, Downgraded to Baa3 from Baa1 Issuer: Regions Financial Corporation -- Issuer Rating, Downgraded to a range of NP, Ba1 from a range of P-3, Baa3 -- Multiple Seniority Shelf, Downgraded to a range of (P)Ba3 to (P)Ba1 from a range of (P)Ba2 to (P)Baa3 -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Subordinate Shelf, Downgraded to (P)Ba2 from (P)Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Regions Financing Trust II -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 -- Preferred Stock Shelf, Downgraded to (P)Ba3 from (P)Ba2 Issuer: Regions Financing Trust III -- Preferred Stock Preferred Stock, Downgraded to Ba3 from Ba2 Issuer: Union Planters Bank, National Association -- Subordinate Regular Bond/Debenture, Downgraded to Ba1 from Baa2 Issuer: Union Planters Corporation -- Subordinate Regular Bond/Debenture, Downgraded to Ba2 from Ba1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1 from Baa3 Issuer: Amegy Bank National Association -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: California Bank & Trust -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Nevada State Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Issuer: Zions First National Bank -- Issuer Rating, Downgraded to B1 from Ba3 -- OSO Senior Unsecured OSO Rating, Downgraded to B1 from Ba3 -- Senior Unsecured Deposit Rating, Downgraded to Ba3 from Ba2 Upgrades: Issuer: SunTrust Bank -- Bank Financial Strength Rating, Upgraded to C from C- Issuer: SunTrust Banks, Inc. -- Multiple Seniority Shelf, Upgraded to (P)Baa3 from (P)Ba1 -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Preferred Capital I -- Preferred Stock Preferred Stock, Upgraded to Ba1 from Ba2 Issuer: SunTrust Real Estate Investment Corporation -- Preferred Stock Preferred Stock, Upgraded to Baa3 from Ba1 On Review for Possible Downgrade: Issuer: BB&T Capital Trust I -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust II -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust IV -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 Issuer: BB&T Capital Trust V -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VI -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VII -- Preferred Stock Preferred Stock, Placed on Review for Possible Downgrade, currently A3 -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Capital Trust VIII -- Preferred Stock Shelf, Placed on Review for Possible Downgrade, currently (P)A3 Issuer: BB&T Corporation -- Issuer Rating, Placed on Review for Possible Downgrade, currently A1 -- Multiple Seniority Medium-Term Note Program, Placed on Review for Possible Downgrade, currently a range of (P)A2, (P)A1 -- Multiple Seniority Shelf, Placed on Review for Possible Downgrade, currently a range of (P)A3 to (P)A1 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A2 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 Issuer: BB&T Financial, FSB -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Issuer: Branch Banking and Trust Company -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently B -- Issuer Rating, Placed on Review for Possible Downgrade, currently Aa3 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Multiple Seniority Bank Note Program, Placed on Review for Possible Downgrade, currently a range of A1 to Aa3 -- Subordinate Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently A1 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Aa3 Outlook Actions: Issuer: American Express Travel Related Svcs Co., Inc -- Outlook, Changed to Negative From Stable Issuer: American Express Centurion Bank -- Outlook, Changed to Negative From Stable Issuer: American Express Bank, FSB -- Outlook, Changed to Negative From Stable Issuer: American Express Credit Corporation -- Outlook, Changed to Negative From Stable Issuer: BB&T Capital Trust I -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust II -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust IV -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust V -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VI -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Capital Trust VIII -- Outlook, Changed To Rating Under Review From Negative Issuer: BB&T Corporation -- Outlook, Changed To Rating Under Review From Negative Issuer: Banco Popular de Puerto Rico -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Financial Corporation -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital II -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital III -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital IV -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital V -- Outlook, Changed to Stable from Negative Issuer: Capital One Capital VI -- Outlook, Changed to Stable from Negative Issuer: North Fork Capital Trust II -- Outlook, Changed to Stable from Negative Issuer: Hibernia Corporation -- Outlook, Changed to Stable from Negative Issuer: National Commerce Capital Trust I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Banks, Inc. -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital I -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital IX -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital VIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital X -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XIV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XV -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVI -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Capital XVII -- Outlook, Changed To Stable From Rating Under Review Issuer: SunTrust Preferred Capital I -- Outlook, Changed To Stable From Negative Issuer: SunTrust Real Estate Investment Corporation -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Bank, Ohio -- Outlook, Changed To Stable From Rating Under Review Issuer: Fifth Third Bancorp -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust II -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust IV -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust V -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VI -- Outlook, Changed To Stable From Negative Issuer: Fifth Third Capital Trust VII -- Outlook, Changed To Stable From Negative Issuer: KeyBank National Association -- Outlook, Changed To Stable From Rating Under Review Issuer: KeyCorp -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital I -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital II -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital III -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital V -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VI -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital VIII -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital IX -- Outlook, Changed To Stable From Negative Issuer: KeyCorp Capital X -- Outlook, Changed To Stable From Negative Issuer: National City Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Indiana -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Kentucky -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Bank of Pennsylvania -- Outlook, Changed To Positive From Rating Under Review Issuer: PNC Bank, N.A. -- Outlook, Changed To Positive From Rating Under Review Issuer: Provident Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: National City Preferred Capital Trust I -- Outlook, Changed To Positive From Stable Issuer: Merchants National Corp -- Outlook, Changed To Positive From Stable Issuer: National City Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust C -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust D -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust E -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust F -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust G -- Outlook, Changed To Positive From Stable Issuer: PNC Capital Trust H -- Outlook, Changed To Positive From Stable Issuer: PNC Funding Corporation -- Outlook, Changed To Positive From Stable Issuer: Mercantile Bankshares Corporation -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust II -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust III -- Outlook, Changed To Positive From Stable Issuer: National City Capital Trust IV -- Outlook, Changed To Positive From Stable Issuer: National City Credit Corporation -- Outlook, Changed To Positive From Stable Issuer: PNC Financial Services Group, Inc. -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust I -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust II -- Outlook, Changed To Positive From Stable Issuer: PNC Preferred Funding Trust III -- Outlook, Changed To Positive From Stable Issuer: U.S. Bank National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: U.S. Bank National Association ND -- Outlook, Changed To Negative From Rating Under Review Issuer: Capital One Bank -- Outlook, Changed To Stable From Rating Under Review Issuer: Capital One, N.A. -- Outlook, Changed To Stable From Rating Under Review Issuer: AmSouth Bancorporation -- Outlook, Changed To Negative From Rating Under Review Issuer: AmSouth Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Bank -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financial Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust II -- Outlook, Changed To Negative From Rating Under Review Issuer: Regions Financing Trust III -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Bank, National Association -- Outlook, Changed To Negative From Rating Under Review Issuer: Union Planters Corporation -- Outlook, Changed To Negative From Rating Under Review Issuer: Amegy Bank National Association -- Outlook, Changed To Positive From Rating Under Review Issuer: California Bank & Trust -- Outlook, Changed To Positive From Rating Under Review Issuer: Nevada State Bank -- Outlook, Changed To Positive From Rating Under Review Issuer: Zions First National Bank -- Outlook, Changed To Positive From Rating Under Review Confirmations: Issuer: National Commerce Capital Trust I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Banks, Inc. -- Issuer Rating, Confirmed at Baa1 -- Multiple Seniority Shelf, Confirmed at (P)Baa3, (P)Baa2, (P)Baa1 -- Subordinate Regular Bond/Debenture, Confirmed at Baa2 -- Senior Unsecured Regular Bond/Debenture, Confirmed at Baa1 Issuer: SunTrust Capital I -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital IX -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital VIII -- Preferred Stock Preferred Stock, Confirmed at Baa3 Issuer: SunTrust Capital X -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIII -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XIV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XV -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVI -- Preferred Stock Shelf, Confirmed at (P)Baa3 Issuer: SunTrust Capital XVII -- Preferred Stock Shelf, Confirmed at (P)Baa3 The principal methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, and Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007. * Upcoming Meetings, Conferences and Seminars --------------------------------------------- Nov. __, 2010 AMERICAN BANKRUPTCY INSTITUTE Delaware Views from the Bench and Bankruptcy Bar Hotel du Pont, Wilmington, Del. Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. 11, 2010 AMERICAN BANKRUPTCY INSTITUTE Detroit Consumer Bankruptcy Conference Hyatt Regency Dearborn, Dearborn, Mich. Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. 29, 2010 RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP, INC. 17th Annual Distressed Investing Conference The Helmsley Park Lane Hotel, New York City Contact: 1-903-595-3800; http://www.renaissanceamerican.com/ Dec. 9-11, 2010 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Camelback Inn, a JW Marriott Resort & Spa, Scottsdale, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ Dec. 2-4, 2010 AMERICAN BANKRUPTCY INSTITUTE 22nd Annual Winter Leadership Conference Camelback Inn, Scottsdale, Arizona Contact: 1-703-739-0800; http://www.abiworld.org/ January 26-28, 2011 TURNAROUND MANAGEMENT ASSOCIATION TMA Distressed Investing Conference Aria Las Vegas Contact: http://www.turnaround.org/ Jan. 27-28, 2011 AMERICAN BANKRUPTCY INSTITUTE Rocky Mountain Bankruptcy Conference Westin Tabor Center, Denver, Colo. Contact: 1-703-739-0800; http://www.abiworld.org/ Feb. 3-5, 2011 AMERICAN BANKRUPTCY INSTITUTE Caribbean Insolvency Symposium Westin Casuarina Resort & Spa, Grand Cayman Island Contact: 1-703-739-0800; http://www.abiworld.org/ Feb. 24-25, 2011 AMERICAN BANKRUPTCY INSTITUTE Valcon Four Seasons Las Vegas, Las Vegas, Nev. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 4, 2011 AMERICAN BANKRUPTCY INSTITUTE Bankruptcy Battleground West Hyatt Regency Century Plaza, Los Angeles, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 7-9, 2011 AMERICAN BANKRUPTCY INSTITUTE Conrad Duberstein Moot Court Competition Duberstein U.S. Courthouse, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 10, 2011 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - Florida Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 10-12, 2011 AMERICAN BANKRUPTCY INSTITUTE SUCL/ Alexander L. Paskay Seminar on Bankruptcy Law and Practice Marriott Tampa Waterside, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 17-19, 2011 AMERICAN BANKRUPTCY INSTITUTE Byrne Judicial Clerkship Institute Pepperdine University School of Law, Malibu, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 31-Apr. 3, 2011 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ April 27-29, 2011 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott, Chicago, IL Contact: http://www.turnaround.org/ May 5, 2011 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - New York City Association of the Bar of the City of New York, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ May 6, 2011 AMERICAN BANKRUPTCY INSTITUTE New York City Bankruptcy Conference Hilton New York, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ June 6, 2011 AMERICAN BANKRUPTCY INSTITUTE Canadian-American Cross-Border Insolvency Symposium Fairmont Royal York, Toronto, Ont. Contact: 1-703-739-0800; http://www.abiworld.org/ June 9-12, 2011 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort and Spa, Traverse City, Mich. Contact: http://www.abiworld.org/ July 21-24, 2011 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Hyatt Regency Newport, Newport, R.I. Contact: 1-703-739-0800; http://www.abiworld.org/ July 27-30, 2011 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Sanctuary at Kiawah Island, Kiawah Island, S.C. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 4-6, 2011 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hotel Hershey, Hershey, Pa. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 14, 2011 AMERICAN BANKRUPTCY INSTITUTE NCBJ/ABI Educational Program Tampa Convention Center, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. __, 2011 AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium Dublin, Ireland Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 25-27, 2011 TURNAROUND MANAGEMENT ASSOCIATION Hilton San Diego Bayfront, San Diego, CA Contact: http://www.turnaround.org/ Dec. 1-3, 2011 AMERICAN BANKRUPTCY INSTITUTE 23rd Annual Winter Leadership Conference La Quinta Resort & Spa, La Quinta, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ April 3-5, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference Grand Hyatt Atlanta, Atlanta, Ga. Contact: http://www.turnaround.org/ Apr. 19-22, 2012 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ November 1-3, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Westin Copley Place, Boston, Mass. Contact: http://www.turnaround.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ April 10-12, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott Chicago, Chicago, Ill. Contact: http://www.turnaround.org/ October 3-5, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Wardman Park, Washington, D.C. Contact: http://www.turnaround.org/ The Meetings, Conferences and Seminars column appears in the Troubled Company Reporter each Wednesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. Last Updated: October 15, 2010 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers" public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, Joseph Medel C. Martirez, Denise Marie Varquez, Philline Reluya, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2010. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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 ***