/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110114.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, January 14, 2011, Vol. 15, No. 13 Headlines 3525 NORTH: Case Summary & Largest Unsecured Creditor ABITIBIBOWATER INC: Fibrek Will Receive 236,226 New Shares AIR MEDICAL: S&P Assigns 'B' Corporate Credit Rating AMR CORP: FMR LLC Discloses 2.956% Equity Stake AMERICAN INT'L: Fairholme Capital Has 31.6% Equity Stake ANCHOR BLUE: Taps Epiq as Claims, Noticing & Balloting Agent ANGIOTECH PHARMACEUTICALS: Shares Trading to transfer to OTCQB AS AMERICA: Moody's Assigns 'B3' Corporate Family Rating ASAP EXPRESS: Disclosure Statement Revisions Due Today BELTWAY 8: Gets Court's Interim Nod to Use FST's Cash Collateral BELTWAY 8: Gets Interim OK to Hire Steffes as Bankr. Counsel BERNARD L MADOFF: Judge Approves $7.2 Billion Picower Accord BERNARD L MADOFF: SEC Withdraws Suit v Chais Estate BIOLIFE SOLUTIONS: CEO Reports $575,000 Record Revenue in Q4 B.R. SUMMERLIN: Section 341(a) Meeting Scheduled for Feb. 10 BROOKE CORP: Judge Lets Ch. 7 Trustee Settle $4-Mil. in Claims BRUNSCHWIG & FILS: Files for Ch. 11 to Sell Assets to Kravet BRUNSCHWIG & FILS: Voluntary Chapter 11 Case Summary CARGO TRANSPORTATION: Files for Ch. 11 After Dispute with Lender CARGO TRANSPORTATION: Voluntary Chapter 11 Case Summary CARIAN MANAGEMENT: To Present Plan for Confirmation on March 9 CATHOLIC CHURCH: Milwaukee Proposes KCC as Noticing Agent CATHOLIC CHURCH: Milwaukee Proposes O'Neil as Special Counsel CATHOLIC CHURCH: PETA Offers Milwaukee Cash in Exchange of Statue CATHOLIC CHURCH: St. Dennis Plea to Use Insurance Denied CEDAR FAIR: Moody's to Keep 'Ba3' Rating Amid Q Funding Proposal CENTRALIA OUTLETS: Final Hearing on Cash Collateral Use Set Feb. 3 CENTRALIA OUTLETS: Files Schedules of Assets and Liabilities CENTRIX FINANCIAL: Suit vs. Insurers Stays in Bankruptcy Court CHINA VILLAGE: Court Sets February 18 Disclosure Statement Hearing CIELO APARTMENTS: Courts Grants Debtor's Motion to Dismiss Case COLUMBUS MCKINNON: S&P Affirms 'BB-' Corporate Credit Ratings COMPASS DIVERSIFIED: Moody's Affirms 'Ba3' Corporate Rating COMSTOCK MINING: Deloitte Hired to Audit Financial Statements CONSOLIDATED PROPERTIES: Case Summary & 6 Largest Unsec Creditors CONSTAR INT'L: Taps Greenhill & Co. as Financial Advisor CONSTAR INT'L: Proposes $55MM of Financing from Black Diamond CONSTAR INT'L: Presents $60MM Exit Financing Deal with Wells Fargo CORRYL NADEEN PARR: Court Wants Plan Docs Revised by Jan. 18 CPJFK LLC: Chapter 11 Trustee Files Emergency Motion to Use Cash CROWN MEDIA: Michelle Vicary Does Not Own Any Securities CUSTOM CABLE: Selects Tom Ward as New President DB CAPITAL: Files Schedules of Assets and Liabilities DBSI SHERIDAN: Files for Chapter 11 in Fort Lauderdale DBSI SHERIDAN: Voluntary Chapter 11 Case Summary DENNY'S CORP: Names Former Taco Bueno Head J. Miller as New CEO DILLARD'S INC: S&P Raises Corporate Rating to 'BB-' DOMICILE LAND: Case Summary & 4 Largest Unsecured Creditors ELITE PHARMACEUTICALS: Inks Supply Pact with Hi-Tech EMIVEST AEROSPACE: Wants May 18 Plan Filing Exclusivity Extension EVERGREEN ENERGY: Ilyas Khan Owns 1.2MM Derivative Securities FAIRPOINT COMMS: Verizon Fights to Bring Claims Over $2-Bil. Deal FORTY ACRE: Voluntary Chapter 11 Case Summary GRAY STAR: Voluntary Chapter 11 Case Summary GRAY TELEVISION: Capital World Equity Stake Down to 0% GREAT ATLANTIC & PACIFIC: Wins Final Nod of $800MM Financing GREAT ATLANTIC & PACIFIC: Wins OK for Access to Cash Collateral GREAT ATLANTIC & PACIFIC: To Waive Preferences vs. Key Vendors GURU PROPERTIES: Case Summary & 20 Largest Unsecured Creditors HARRISBURG, PA: Hires Consultants to Draft Financial Recovery Plan HEADGEAR, INC: Case Summary & 20 Largest Unsecured Creditors INN OF THE MOUNTAIN: Recurring Losses Cue Going Concern Doubt INNKEEPERS USA: Working With Five Mile, Lehman on Plan Funding KANSAS CITY SOUTHERN: Fitch Puts 'BB' Rating on $185MM Sr. Notes KENTUCKY DATA: Moody's Confirms 'B1' Corporate Family Rating KH FUNDING: U.S. Trustee Gets More Time to Challenge Gray Hiring LEVEL 3 COMMS: S&P Assigns 'CCC' to Proposed $300MM Unsec. Notes LEWIS BLOOM: Seeks Court OK to Retain Special Counsel LIONS GATE: MHR Fund Management Holds 29.4% Equity Stake LIONS GATE VENTURES: Section 341(a) Meeting Scheduled for Feb. 15 LOUIS JONES ENTERPRISES: ERISA Problems Give Employee Priority MAGIC BRANDS: Luby's Sues Fuddruckers Licensee for Contempt MCGRATH'S PUBLICK: Employee Class Claim Loses Priority Status MEDICAL WIND: IRS' Erroneous Tax Refund Claim Survives Dismissal MGM RESORTS: CityCenter Proposes to Offer $1.1-Bil. Notes MICHAEL ARANDA: Checking Account 1 Not TBE Property MOBILE TEAM: Hirschler Fleischer Not Subject to Disgorgement MOLECULAR INSIGHT: Bondholders Want Investment Agreement Trashed MORTGAGES LTD: Radical Bunny Managers Want SEC Fraud Case Nixed MS GRAND: Chapter 11 Case Transferred to Alexandria MYSPACE INC: News Corp. Considering Spinoff or Sale NIELSEN CO: S&P Puts 'B+' Corp. Rating on CreditWatch Positive NPS PHARMACEUTICALS: Ends Phase 3 Registration Study of GATTEX NPS PHARMACEUTICALS: Wins Favorable Verdict Against Teva & Barr OTTER TAIL: Proposes Green Plains-Led Auction for Ethanol Plant OVERSEAS SHIPHOLDING: S&P Lowers Corporate Rating to 'B' PERRY ELLIS: Rafaella Buyout Cues Moody's to Hold 'B2' Ratings PRECISION OPTICS: Marxe and Greenhouse Hold 69.5% Equity Stake PRECISION PARTS: Gibraltar Settles $3-Mil. Preference for $2,000 QWEST COMMUNICATIONS: BlackRock Holds 11.39% Equity Stake RECKSON OPERATING: Moody's Raises Senior Debt Ratings to 'Ba1' RIPTIDE HOTEL: Voluntary Chapter 11 Case Summary ROBERT MIELL: Bid to Dismiss Ch. 7 Trustee Proceed to Trial RYLAND GROUP: BlackRock Discloses 10.17% Equity Stake SBARRO INC: Ares Management Aiming to Take 'Out' Owner, KDP Says SEQUENOM INC: Court Grants Motion to Strike in "Hawran" Suit SOUTHWEST RESTAURANT: Voluntary Chapter 11 Case Summary SYNTERRA 3020: Files for Ch. 11 Due to Debt Woes SYNTERRA 3020: Case Summary & 19 Largest Unsecured Creditors TAPATIO SPRINGS DEV'T: Secured Creditors Want Case Dismissed THORNBURG MORTGAGE: Judge Cuts Executives' Bid for Defense Costs TJ'S TREES: Case Summary & 20 Largest Unsecured Creditors UNIGENE LABORATORIES: Provides 2011 Business Outlook UNISYS CORP: Joseph Harrosh Discloses 6.6% Equity Stake UNITED FOOTBALL: Faces Suit for Nonpayment of $5 Million Loan URS CORPORATION: Moody's Cuts Rating on Bank Facility to 'Ba1' UTSTARCOM INC: To Change Place of Incorporation to Cayman Islands VERSO PAPER: S&P Puts 'B' Rating on $360-Mil. 2nd Lien Notes VITRO SAB: Mexican Reorganization Faulted on Insider Vote WINDSOR LAKE: Organizational Meeting Moved to Jan. 14 WINDSOR QUALITY: S&P Holds 'B+' Credit Rating; Outlook Stable WN TRUCK STOP: Bankr. Court Says Plan Not Feasible WORKFLOW MANAGEMENT: Unsecured Creditors Not on Board With Plan W.R. GRACE: Court Conditionally Approves CNA Settlement W.R. GRACE: Proposes to Amend 2010 L/C Facility Agreement W.R. GRACE: Proposes to Extend ART Credit Agreement W.R. GRACE: Wins Nod of Swiss Reinsurance Settlement ZURICH ASSOCIATES: Brooklyn Property in Chapter 11 * Healthcare Costs "Will Bankrupt" New Jersey, Governor Says * PIMCO's Gross Expects Municipal Bankruptcies to Decrease * Wilbur Ross's IAC Acquires Indian Auto-Interior Parts Biz. * Brown Rudnick Among Law360's Bankruptcy Group of the Year * Venable LLP Elects Brent W. Procida, Esq., as New Partner * BOOK REVIEW: Megamergers - Corporate America's Billion-Dollar Takeovers ********* 3525 NORTH: Case Summary & Largest Unsecured Creditor ----------------------------------------------------- Debtor: 3525 North Reta, Inc. 6115 N. Karolv Chicago, IL 60646 Bankruptcy Case No.: 11-00997 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court Northern District of Illinois (Chicago) Judge: Jacqueline P. Cox Debtor's Counsel: Patience R. Clark, Esq. LAW OFFICE OF PATIENCE R. CLARK P.C. 30 N. LaSalle Street, Suite 3400 Chicago, IL 60602 Tel: (312) 332-0133 Fax: (312) 332-0144 E-mail: prc@clarklawchicago.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ InBank 6 Unit Bldg. $2,100,000 c/o Dykema Gossett, PLLC at 3525 N. 10 S. Wacker Drive, Reta Ave. Suite 2300 Chicago, IL Chicago, IL 60606 The petition was signed by Ihor Ralko, president. ABITIBIBOWATER INC: Fibrek Will Receive 236,226 New Shares ---------------------------------------------------------- Fibrek Inc. disclosed that Fibrek General Partnership, its wholly- owned subsidiary, will receive 236,226 common shares of AbitibiBowater Inc. in connection with the initial distribution of ABH Shares pursuant to the procedures undertaken by Abitibi under the Companies' Creditors Arrangement Act. As an unsecured creditor of Abitibi-Consolidated Company of Canada, a subsidiary of Abitibi, Fibrek GP filed a claim in the amount of $45 million as compensation for the repudiation by ACCC, on May 21, 2009, of the woodchip supply contract then in effect between ACCC and Fibrek GP. Pursuant to the plan of reorganization and compromise of Abitibi, a total of 20,498,391 ABH Shares will be issued to ACCC's unsecured creditors, of which 18,165,317 have been issued in connection with the initial distribution and 2,333,074 have been reserved for the benefit of holders of disputed claims and could be distributed subsequently to unsecured creditors in accordance with the terms of the plan of reorganization. The distribution of ABH Shares to Fibrek GP will be treated as a non-recurring item in the consolidated statements of earnings of Fibrek Inc. About Fibrek Fibrek is a leading producer and marketer of high-quality virgin and recycled kraft pulp. The Company has approximately 500 employees and operates three mills located in Saint-Felicien, Quebec, Fairmont, West Virginia, and in Menominee, Michigan with a combined annual production capacity of approximately 760,000 tonnes. The Saint-Felicien mill provides northern bleached softwood kraft pulp (product known as NBSK pulp) to various sectors of the paper industry in Canada, the United States and Europe, for use in the production of specialized products. The Fairmont and Menominee mills manufacture air-dried recycled bleached kraft pulp (product known as RBK pulp) and primarily supply manufacturers of fine uncoated paper, household paper for commercial and industrial uses, and coated paper in the United States. About AbitibiBowater Inc. AbitibiBowater Inc. produces newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 22 pulp and paper facilities and 26 wood products facilities located in the United States, Canada and South Korea. The Company also recycles old newspapers and magazines. The Company and several of its affiliates filed for protection under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr. D. Del. Lead Case No. 09-11296). The Company and its Canadian affiliates commenced parallel restructuring proceedings under the Companies' Creditors Arrangement Act before the Quebec Superior Court Commercial Division the next day. Alex F. Morrison at Ernst & Young, Inc., was appointed CCAA monitor. Paul, Weiss, Rifkind, Wharton & Garrison LLP, served as the Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acted as the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, served as the Debtors' co-counsel, while Troutman Sanders LLP in New York, served as the Debtors' conflicts counsel in the Chapter 11 proceedings. The Debtors' financial advisors were Advisory Services LP, and their noticing and claims agent was Epiq Bankruptcy Solutions LLC. The CCAA Monitor's counsel was Thornton, Grout & Finnigan LLP, in Toronto, Ontario. Abitibi-Consolidated Inc. and various Canadian subsidiaries filed for protection under Chapter 15 of the U.S. Bankruptcy Code on April 17, 2009 (Bankr. D. Del. 09-11348). Pauline K. Morgan, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, represented the Chapter 15 Debtors. U.S. Bankruptcy Judge Kevin Carey handled the Chapter 11 cases of AbitibiBowater Inc. and its U.S. affiliates and the Chapter 15 case of ACI, et al. The U.S. Bankruptcy Court issued an opinion confirming AbitibiBowater's chapter 11 plan of reorganization on November 22, 2010. The Debtors also obtained approval of their reorganization plan under the Canadian Companies' Creditors Arrangement Act. AbitibiBowater emerged from bankruptcy on December 9, 2010. AIR MEDICAL: S&P Assigns 'B' Corporate Credit Rating ---------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Lewisville, Texas-based Air Medical Group Holdings Inc. The rating outlook is stable. At the same time, S&P assigned its 'B' issue-level rating and '4' recovery rating to Air Medical's $545 million senior secured notes. The 'B' issue rating is the same as the corporate credit rating. The recovery rating of '4' indicates the expectation of average (30%-50%) recovery in the event of default. The Company used the proceeds from the $545 million issuance and sponsor common equity to fund the Bain LBO from the existing financial sponsors. Air Medical, a provider of emergency air medical transportation mostly to rural communities, is being purchased by Bain Capital in a highly leveraged transaction. "We expect the Company's operating performance will be stable to improving in the near term because third-party reimbursement rates are likely to be stable to positive over the next year," said Standard & Poor's credit analyst Rivka Gertzulin. Air Medical's rating reflects its aggressive financial risk profile characterized by its high debt leverage and limited historical cash flow generation. The Company's business risk profile is weak, in S&P's opinion. It has a narrow operating focus in a fragmented and competitive market that is exposed to reimbursement and regulatory risk. AMR CORP: FMR LLC Discloses 2.956% Equity Stake ----------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on January 10, 2011, each of FMR LLC and Edward C. Johnson 3d disclosed that it beneficially owns 9,906,469 shares of common stock of AMR Corporation, representing 2.956% of the shares outstanding. As of July 14, 2010, there were 333,050,087 shares of common stock of the Company outstanding. Fidelity Management & Research Company, a wholly-owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940, is the beneficial owner of 9,903,322 shares or 2.955% of the Common Stock outstanding of AMR Corporation as a result of acting as investment adviser to various investment companies registered under Section 8 of the Investment Company Act of 1940. The number of shares of Common Stock of AMR Corporation owned by the investment companies at December 31, 2010 included 1,817,172 shares of Common Stock resulting from the assumed conversion of $17,990,000 principal amount of AMR CORP CONV 6.25%. Edward C. Johnson 3d and FMR LLC, through its control of Fidelity, and the funds each has sole power to dispose of the 9,903,322 shares owned by the Funds. Members of the family of Edward C. Johnson 3d, chairman of FMR LLC, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders' voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders' voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Edward C. Johnson 3d, chairman of FMR LLC, has the sole power to vote or direct the voting of the shares owned directly by the Fidelity Funds, which power resides with the Funds' Boards of Trustees. Fidelity carries out the voting of the shares under written guidelines established by the Funds' Boards of Trustees. Strategic Advisers, Inc., a wholly-owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940, provides investment advisory services to individuals. As such, FMR LLC's beneficial ownership includes 300 shares, or 0.000%, of the Common Stock outstanding of AMR Corporation, beneficially owned through Strategic Advisers, Inc. Pyramis Global Advisors Trust Company, an indirect wholly-owned subsidiary of FMR LLC and a bank as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, is the beneficial owner of 2,847 shares or 0.001% of the outstanding Common Stock of the AMR Corporation as a result of its serving as investment manager of institutional accounts owning such shares. Edward C. Johnson 3d and FMR LLC, through its control of Pyramis Global Advisors Trust Company, each has sole dispositive power over 2,847 shares and sole power to vote or to direct the voting of 0 shares of Common Stock owned by the institutional accounts managed by PGATC. About AMR Corporation Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, including Brazil, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. The Company's balance sheet at Sept. 30, 2010, showed $25.36 billion in total assets, $8.94 billion in total liabilities, $9.01 in billion of long-term debts, $503.0 million in obligations under capital lease, $7.41 billion pension and post-retirement benefits, $3.14 billion in other liabilities, and a stockholders' deficit of $3.64 billion. * * * AMR carries a 'CCC' issuer default rating from Fitch Ratings. It has 'Caa1' corporate family and probability of default ratings from Moody's. It has 'B-' corporate credit rating from Standard & Poor's. In November 2010, Standard & Poor's Ratings Services 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. AMERICAN INT'L: Fairholme Capital Has 31.6% Equity Stake -------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on January 10, 2011, Fairholme Capital Management, LLC disclosed that it beneficially owns 44,285,985 shares of common stock of American International Group, Inc., representing 31.6% of the shares outstanding. Bruce R. Berkowitz owns 44,285,985 shares while Fairholme Funds, Inc., owns 40,432,939 or 28.9%. The Company has 140,029,615 Shares outstanding as reported on December 10, 2011. Fairholme has the sole power to vote or direct the vote of 0 Shares, the Fund has the sole power to vote or direct the vote of 0 Shares and Bruce R. Berkowitz has the sole power to vote or direct the vote of 0 Shares. Fairholme has the shared power to vote or direct the vote of 42,232,265 Shares, the Fund has the shared power to vote or direct the vote of 40,432,939 Shares and Bruce R. Berkowitz has the shared power to vote or direct the vote of 42,232,265 Shares. Fairholme has the sole power to dispose or direct the disposition of 0 Shares, the Fund has the sole power to dispose or direct the disposition of 0 Shares and Bruce R. Berkowitz has the sole power to dispose or direct the disposition of 0 Shares. Fairholme has the shared power to dispose or direct the disposition of 44,285,985 Shares, the Fund has the shared power to dispose or direct the disposition of 40,432,939 Shares and Bruce R. Berkowitz has the shared power to dispose or direct the disposition of 44,285,985 Shares. 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. ANCHOR BLUE: Taps Epiq as Claims, Noticing & Balloting Agent ------------------------------------------------------------ Anchor Blue Holding Corp., et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Epiq Bankruptcy Solutions, LLC, as claims, noticing and balloting agent as of the Petition Date. Epiq will, among other things: a. notify all potential creditors of the filing of the Chapter 11 petitions and of the setting of the first meeting of creditors; b. file affidavits of service for all mailings, including a copy of each notice, a list of persons to whom such notice was mailed, and the date mailed; c. assist the Debtors with administrative tasks in the preparation of their bankruptcy Schedules and Statements; and d. maintain an official copy of the Debtors' schedules, listing creditors and amounts owed. Epiq will be paid based on the rates of its professionals: Clerk $36 to $54 Case Manager (Level 1) $112 to $157 IT Programming Consultant $126 to $171 Case Manager (Level 2) $166 to $198 Senior Case Manager $202 to $247 Senior Consultant $265 A copy of Epiq's service agreement with the Debtors is available for free at: http://bankrupt.com/misc/ANCHOR_BLUE_epiqservicepact.pdf Edward J. Kosmowski, Vice President and Senior Consultant with Epiq, assures the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. About Anchor Blue Anchor Blue is a specialty retailer of casual apparel and accessories for the teenage market. Founded in 1972, the Company has 117 stores located in nine western and southwestern states: Arizona, California, Colorado, New Mexico, Oregon, Texas, Utah and Washington. The Company employed 1,446 full and part-time employees in their stores and their corporate headquarters in Corona, California. Anchor Blue is an indirect affiliate of Sun Capital Partners, a Florida-based investment firm. Anchor Blue Holding Corp., together with Anchor Blue Inc., filed for Chapter 11 bankruptcy protection on January 11, 2011 (Bankr. D. Del. Lead Case No. 11-10110). Kenneth J. Enos, Esq., and Michael R. Nestor, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' bankruptcy counsel. As of January 1, 2011, the Debtors' books and records reflected total combined assets of roughly $24.7 million (book value) and total combined liabilities of roughly $38.5 million. ANGIOTECH PHARMACEUTICALS: Shares Trading to transfer to OTCQB -------------------------------------------------------------- Angiotech Pharmaceuticals, Inc. disclosed that trading of shares of the Company's common stock will be transferred from the Nasdaq Stock Market to the OTCQB(TM) Marketplace effective January 13, 2011. As previously disclosed on January 5, 2011, Angiotech received a notice from Nasdaq stating Angiotech has not regained compliance with Nasdaq's Listing Rule 5450(a)(1) within the 180 calendar day grace period ending January 3, 2011. Nasdaq's notice indicated Angiotech's common shares will be delisted on January 13, 2011. The Company has been advised by Pink OTC Markets, Inc., which operates an electronic quotation service for securities traded over-the-counter, that its securities are immediately eligible for quotation on the OTCQB. The OTCQB is a market tier for OTC-traded companies that are registered and reporting with the Securities and Exchange Commission. The Company has also been advised that its shares will trade under the symbol ANPI. Investors will be able to view real-time stock quotes for ANPI at http://www.otcmarkets.com/ Angiotech's common shares will still be tradable on the Toronto Stock Exchange under the trading symbol "ANP". About Angiotech Pharmaceuticals Based in Vancouver, British Columbia, in Canada, Angiotech Pharmaceuticals, Inc. (NASDAQ: ANPI; TSX: ANP) -- http://www.angiotech.com/-- is a global specialty pharmaceutical and medical device company. Angiotech discovers, develops and markets innovative treatment solutions for diseases or complications associated with medical device implants, surgical interventions and acute injury. The Company's balance sheet at Sept. 30, 2010, showed $ 326.80 million in total assets, $60.30 million in total liabilities, and a stockholders' deficit of $622.16 million. In early December 2010, Angiotech said it has reached an agreement with the holders of 76% of its 7.75% Senior Subordinated Notes to extend certain deadlines outlined in their Recapitalization Support Agreement dated October 29, 2010. Seventy-three% of the holders of the Subordinated Notes executed the Initial Support Agreement and presently, 85% of the holders of the Subordinated Notes have consented to the Initial Support Agreement. On November 29, 2010, Angiotech and the Trustee, at the direction of a majority of the holders of its Subordinated Notes, extended the grace period applicable to interest payments due on the Subordinated Notes before an event of default occurs, with such grace period applicable to the $9.7 million semi-annual interest payment that was due on the Subordinated Notes on October 1, 2010 extended until December 30, 2010. In November 2010, Moody's Investors Service downgraded the probability of default rating of Angiotech 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. AS AMERICA: Moody's Assigns 'B3' Corporate Family Rating -------------------------------------------------------- Moody's Investor Service assigned a first time B3 Corporate Family Rating and B3 Probability of Default Rating to AS America, Inc. In a related action, Moody's assigned a B3 rating to the proposed Senior Secured Notes due 2016 of AS America, Inc. ASD Americas Holding Corp., AS America, Inc.'s indirect parent holding company, and its material domestic subsidiaries are guarantors. The rating outlook is stable. The following ratings were assigned: -- Corporate Family Rating assigned B3; -- Probability of Default Rating assigned B3; and, -- 1st Lien Senior Secured Notes due 2016 rated B3 (LGD3, 48%). American Standard's B3 Corporate Family Rating considers the company's exposure to cyclical end markets including new home construction, the repair and remodeling sector, and the commercial construction industry. The company is also susceptible to revenue and operating margin volatility. The rating also reflects significant distribution channel concentration, with the big box retailers representing a large percentage of sales. Intense competition with other manufacturers of chinaware, faucets, and kitchen and bath products -- American Standard's primary products -- will drive the urgency for new product introduction and pressure product pricing. American Standard is also exposed to volatility in raw material prices and may be unable to immediately pass through higher costs for commodities such as linerboard, steel, copper and natural gas and oil, which would have a negative impact operating margins. Nonetheless, American Standard's portfolio of well-established brand names especially, in chinaware, baths and plumbing fixtures, is a credit strength. Moody's anticipates American Standard's operating performance will improve over the next year as it benefits from cost reduction actions and improved operating efficiencies. Once American Standard completes its capital restructuring, it will have manageable debt leverage with no near- term maturities. Revolver availability supports the company's liquidity as well. The B3 rating assigned to the proposed $175 million senior secured notes due 2016 is at the same level as the corporate family rating, reflecting the preponderance of secured debt in American Standard's capital structure. These notes will have a first priority lien on substantially all of American Standard's non- current assets and a second priority interest in the proposes revolving credit facility's security. The stable outlook reflects Moody's expectations that American Standard's operating margins and leverage metrics will improve, and that sufficient revolver availability will help it contend with ongoing economic uncertainties and the resulting impact on the residential and commercial end markets. Although Moody's anticipates improving operating margins, an improvement in the ratings will depend on the company's ability to generate meaningful levels of free cash flow. Furthermore, over the intermediate term, an improved liquidity profile and operating performance that results in debt-to-EBITDA sustained below 4.0 times and EBITA-to-interest expense trending towards 2.5 times could result in a positive rating action. Factors which might pressure the ratings include a decline in the company's financial performance, debt financed acquisitions, any dividends to shareholders or a deteriorating liquidity profile. Debt-to-EBITDA remaining above 5.5 times or EBITA-to-interest expense remaining below 1.5 times for an extended period of time would likely result in rating pressures. The principal methodologies used in this rating were the Global Manufacturing Industry methodology published in December 2010 and the Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA methodology published in June 2009. AS America, Inc., headquartered in Piscataway, NJ, is a North American manufacturer and distributor of bath and kitchen products for use primarily in the repair and remodeling sector, new home construction and commercial construction industries. The U.S represents the majority of sales. Sun Capital Partners, Inc., through affiliated funds, is the primary owner of American Standard. Bain Capital, through its affiliated funds, is a minority owner. ASAP EXPRESS: Disclosure Statement Revisions Due Today ------------------------------------------------------ Bankruptcy Judge Thomas J. Tucker directs A.S.A.P. Express & Logistics, Inc., to amend the disclosure statement explaining the bankruptcy-exit plan it filed on December 30, 2010. Judge Tucker's January 10, 2011 order enumerates problems in the Plan document that the Debtor must correct. A copy of the Court's order is available at http://is.gd/0CglLNfrom Leagle.com. Judge Tucker directs the Debtor to file an amended combined plan and disclosure statement, which corrects the problems, no later than January 14, 2011. The Debtor also must provide to Judge's chambers a redlined version of the amended combined plan and disclosure statement. Based in Romulus, Michigan, A.S.A.P. Express & Logistics, Inc., fka A.S.A.P. Express Inc., and fdba ASAP Logistics, Inc., filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 10-67609) on September 1, 2010. Samuel Firebaugh, Esq. -- FirebaughAndrews@comcast.net -- Firebaugh & Andrews, P.L.L.C., in Westland, Michigan, serves as the Debtor's counsel. In its petition, the Debtor estimated $100,001 to $500,000 in assets and $1 million to $10 million in debts. BELTWAY 8: Gets Court's Interim Nod to Use FST's Cash Collateral ---------------------------------------------------------------- Beltway 8 Associates, Limited Partnership, sought and obtained interim authorization from the Hon. Douglas D. Dodd of the U.S. Bankruptcy Court for the Middle District of Louisiana to use the cash collateral of FST Watermarke, LLC. In August 2008, the Debtor obtained a loan from Compass Bank in the principal amount of $21,250,000 for the refinance and refurbishment of Watermarke. The Loan was secured by real property as well as the Debtor's cash, accounts receivable, and rents, which may be cash collateral. Recently the Loan was acquired by FST Watermarke, LLC, from Compass. Upon information and belief, the outstanding balance on the Loan is $21,250,000. Patrick S. Garrity, Esq., Steffes, Vingiello & McKenzie, LLC, explained that the Debtor needs access to cash collateral to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at http://bankrupt.com/misc/BELTWAY8_budget.pdf In exchange for using the cash collateral, the Debtor will grant FST replacement security interests in and liens upon all post- petition personal property of the Debtor and its estate and all proceeds and products of that personal property, and postpetition accounts and cash to the extent that the FST prepetition possessed a valid and perfected security interest and lien in any such accounts and cash. FST will also be granted a claim in the amount of any postpetition diminution in the value of the FST's security interest in the assets of the Debtor. Each Tuesday the Debtor will provide to FST's counsel a written accounting of all expenses (on a cash basis) for the previous Saturday through Friday (for example on January 14, 2011, the Debtor will provide an accounting for the week of January 5-11, 2011). The Debtor will deliver to FST's counsel on or before the twentieth day following the end of each calendar month, a reconciliation of all budgeted amounts and copies of all reports provided by the Debtor's third-party property management company to the Debtor and its counsel. If the Debtor fails to comply with reporting obligations without the prior written consent of the FST, the Debtor will have three business days to cure any default regarding the reporting requirements. If the Debtor fails to cure the default, the Debtor's right to use Cash Collateral will terminate two business days following receipt by Debtor's counsel of a written notice of the default from FST's counsel. Thereafter, the Debtor will have the right to seek court authority to use Cash Collateral on an expedited basis. The Court has set a hearing for January 28, 2011, at 11:00 a.m. on the Debtor's request to use cash collateral. About Beltway 8 Baton Rouge, Louisiana-based Beltway 8 Associates, LP, dba Watermarke Apartments, owns and operates Watermarke Apartments, a 280 unit residential apartment complex located on approximately 15.6 acres in Houston, Texas. It filed for Chapter 11 bankruptcy protection on January 3, 2011 (Bankr. M.D. La. Case No. 11-10001). William E. Steffes, Esq., at Steffes, Vingiello & McKenzie, LLC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. BELTWAY 8: Gets Interim OK to Hire Steffes as Bankr. Counsel ------------------------------------------------------------ Beltway 8 Associates, Limited Partnership, sought and obtained interim authorization from the Hon. Douglas D. Dodd of the U.S. Bankruptcy Court for the Middle District of Louisiana to employ the law firm of Steffes, Vingiello & McKenzie, LLC, as bankruptcy counsel. SVM will, among other things: a. advise the Debtor of its duty to file monthly reports required by applicable law, rule or regulation, and shall specifically advise the debtor of the potential consequences of non-compliance; b. promptly inform the Debtor that it may not pay any debt or obligation owed by the debtor on the date of the filing of the petition; c. advise the Debtor of the prohibition against the sale of any of its assets outside the ordinary course of business without leave of court; and d. advise the Debtor of its obligation to comply with the Internal Revenue Code and Internal Revenue Service regulations, including in particular the depository receipt requirements, and applicable state and local taxation law. The Debtor and SVM didn't disclose how SVM will be compensated for its services. William E. Steffes, Esq., a member at SVM, assured the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. The Court has set a final hearing for January 28, 2011, at 11:00 a.m. on the Debtor's request for authorization to hire SVM as bankruptcy counsel. Baton Rouge, Louisiana-based Beltway 8 Associates, LP, dba Watermarke Apartments, owns and operates Watermarke Apartments, a 280 unit residential apartment complex located on approximately 15.6 acres in Houston, Texas. It filed for Chapter 11 bankruptcy protection on January 3, 2011 (Bankr. M.D. La. Case No. 11-10001). The Debtor estimated its assets and debts at $10 million to $50 million. BERNARD L MADOFF: Judge Approves $7.2 Billion Picower Accord ------------------------------------------------------------ Chad Bray, writing for Dow Jones Newswires, reports that U.S. Bankruptcy Judge Burton R. Lifland's chambers confirmed Thursday that the Court has signed off on a settlement wherein Barbara Picower, the widow of Jeffry Picower, will return $7.2 billion to the victims of Mr. Madoff's fraud. The Associated Press says Judge Lifland approved the deal at the urging of Mr. Picard. According to Mr. Bray, the Picower settlement brings to nearly $10 billion the amount that Irving Picard, the court-appointed trustee for Mr. Madoff's firm, has recovered for Madoff victims. The recovery represents half of Mr. Picard estimates investors lost in the scheme. Mr. Picower, who befriended Mr. Madoff almost three decades ago, died in October 2009 at 67 years old. He was found at the bottom of his swimming pool in Palm Beach, Fla. He had drowned because of a heart attack, according to an autopsy at the time. Mr. Bray notes a group of Madoff investors had objected to the settlement, arguing in part that it shielded the Picower estate from additional lawsuits. He also notes that at the time of the settlement, Mrs. Picower said in a statement that she was "absolutely confident" that her husband was in no way complicit in Mr. Madoff's fraud. 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 from lawsuits or settlements. BERNARD L MADOFF: SEC Withdraws Suit v Chais Estate --------------------------------------------------- Chad Bray, writing for Dow Jones Newswires, reports that the U.S. Securities and Exchange Commission has dropped its lawsuit against Stanley Chais, a Los Angeles money manager who died in September 2010 and allegedly served as one of the biggest feeders of investor funds to Bernard Madoff. Mr. Bray relates the voluntary dismissal order was filed in federal court in Manhattan without prejudice, opening the door for the regulator to pursue action against his estate at a later date if it deems additional litigation is necessary. Mr. Chais, who had been suffering from a blood disease, died at age 84 in September. Mr. Bray says the order notes that Irving Picard, the court- appointed trustee for Mr. Madoff's firm, is separately pursuing a lawsuit seeking to recover $1.1 billion from Mr. Chais, his family or entities he controlled. Mr. Chais had denied wrongdoing before his death. According to Dow Jones, Mr. Chais and his wife reached an agreement with Mr. Picard to freeze their assets after the lawsuit was filed in 2009. The agreement limited their spending to $45,000 a month in living expenses. 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 from lawsuits or settlements. BIOLIFE SOLUTIONS: CEO Reports $575,000 Record Revenue in Q4 ------------------------------------------------------------ BioLife Solutions, Inc., issued a corporate update, by its Chairman and Chief Executive Officer, Mike Rice, to summarize the continued progress the Company made in 2010 on a number of strategic growth initiatives. I am pleased to report preliminary record revenue of $575,000 for the fourth quarter of 2010, an increase of 10% over the third quarter of 2010, and 20% over the same quarter in 2009. Preliminary revenue for the full year of 2010 was $2,081,391, an increase of 32% over 2009. In 2010, we shipped 1,000 product revenue orders to 250 customers in 30 countries. Awareness of the value of our proprietary GMP grade biopreservation media products continues to grow throughout the worldwide life sciences and clinical communities, as our products continue to displace competing "home-brew" formulations and commercial preservation media products. Regenerative Medicine Market - Continued Product Adoption * The worldwide regenerative medicine market is comprised of nearly 1,000 commercial companies and hospitals, which are developing cell and tissue-based products and therapies to treat cancer, heart disease, diabetes, neurologic disorders, movement disorders, and many other afflictions. * In 2010, our biopreservation media products were incorporated into the manufacturing and delivery processes of several new developmental stage regenerative medicine products. We estimate that our products are incorporated into 40 - 50 regenerative medicine products currently in the pre-clinical or clinical trial stage of development. * 2010 revenue from this segment grew 34% from 2009, and accounted for about 31% of total 2010 revenue. * Many regenerative medicine customers have the potential to generate in excess of $1 million of annual revenue for BioLife if regulatory approvals are obtained and the products are successfully commercialized. Contract Manufacturing Services - A New Business and Revenue Stream * Preliminary contract manufacturing revenue for 2010 was about 10% of total revenue. This was a new customer type for the Company in 2010 as we began offering additional services that leverage our expertise and the capacity created by our investment in internal manufacturing. * In the fourth quarter we secured a long-term contract manufacturing relationship with a leading life sciences tools company, in which we will manufacture a private labeled cord blood stem cell freeze media product for our partner. We estimate our partner has approximately 10% of the market for cord blood stem cell freeze media products. * We estimate that nearly all 2010 contract-manufactured products are intended for distribution to cord blood banks in the biobanking segment, and we expect continued growth in this segment in 2011. Distributor Sales - Growth in Our Indirect Sales Channel * Revenue from our indirect distribution channel doubled from 2009 as our partners increased their order volume significantly in the fourth quarter and full year 2010. Revenue from this channel was about 10% of total revenue. In summary, 2010 was pivotal year in the Company's history and growth as we continued to build a recurring revenue base that can transform BioLife into a valuable enterprise and an attractive investment opportunity. We remain focused on our financial priorities for the next 24 to 36 months, which include achieving positive cash flow and reducing our debt levels. In 2011, we look to acquire additional customers in our strategic market segments including regenerative m medicine, biobanking, and drug discovery, and also execute new contract manufacturing and distribution agreements. On behalf of BioLife Solutions, our team members and Board of Directors, I thank you for your continued confidence and support, and look forward to reporting on our progress in 2011. Sincerely, Mike Rice Chairman & Chief Executive Officer About BioLife Solutions Bothell, Washington-based BioLife Solutions, Inc. develops and markets patented hypothermic storage and cryopreservation solutions for cells, tissues, and organs, and provides contracted research and development and consulting services related to optimization of biopreservation processes and protocols. The Company's balance sheet at Sept. 30, 2010, showed $1.29 million in total assets, $10.51 million in total liabilities, and a stockholders' deficit of $9.22 million. * * * According to the Troubled Company Reporter on April 8, 2010, Peterson Sullivan LLP, in Seattle, Washington, in its March 30, 2010 report, said BioLife Solutions, Inc. has been unable to generate sufficient income from operations to meet its operating needs. Additionally, the Company used $2.4 million in cash for operating activities during the year ended December 31, 2009, and has an accumulated deficit of $50 million at December 31, 2009. "These conditions raise substantial doubt about the Company's ability to continue as a going concern," the independent auditors said. B.R. SUMMERLIN: Section 341(a) Meeting Scheduled for Feb. 10 ------------------------------------------------------------ The U.S. Trustee for Region 17 will convene a meeting of B.R. Summerlin Property, LLC's creditors on February 10, 2011, at 1:00 p.m. The meeting will be held at 300 Las Vegas Boulevard, South, Room 1500, Las Vegas, NV 89101. This is the first meeting of creditors required under Section 341(a) of the U.S. Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Woodland Hills, California-based B.R. Summerlin Property, LLC, filed for Chapter 11 bankruptcy protection on January 5, 2011 (Bankr. D. Nev. Case No. 11-10148). Gabrielle A. Hamm, Esq., at Gordon Silver, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates B.R. Brookfield Commons No. 1, LLC (Bankr. D. Nev. Case No. 10-38835) and B.R. Brookfield Commons No. 2, LLC (Bankr. D. Nev. Case No. 10-38838) filed separate Chapter 11 petitions on November 29, 2010. BROOKE CORP: Judge Lets Ch. 7 Trustee Settle $4-Mil. in Claims -------------------------------------------------------------- A bankruptcy judge Wednesday granted a request by Brooke Corp.'s trustee to settle a $4 million chunk of claims in the insurance agency's Chapter 7 proceedings independently, Bankruptcy Law360 reports. About Brooke Corp. Albert Riederer was appointed special master of Brooke Corporation in prepetition federal court proceedings. Shortly after Brooke Corporation filed for Chapter 11 bankruptcy protection (Bankr. D. Kansas Lead Case No. 08-22786) on October 28, 2008, Mr. Riederer was appointed Chapter 11 Trustee. When the case was converted to Chapter 7 on June 29, 2009, Mr. Riederer was appointed Chapter 7 Trustee. On October 29, 2008, the Court granted a motion to jointly administer the bankruptcies of Brooke Corporation, Brooke Capital Corporation, and Brooke Investment, Inc., with the Brooke Corporation bankruptcy case being the lead case. BRUNSCHWIG & FILS: Files for Ch. 11 to Sell Assets to Kravet ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Brunschwig & Fils Inc. filed a Chapter 11 petition to learn if anyone will top the $6.5 million offer for the business from competitor Kravet Inc. Brunschwig wants other offers by March 3, with an auction not more than two days later. The report relates that Kravet's offer is $6.5 million cash plus the cost of curing defaults on leases and contracts, less whatever is outstanding on the $4 million credit to finance the Chapter 11 case. Kravet is providing the loan. Mr. Rochelle relates that Brunschwig & Fils blamed the bankruptcy on the decrease in consumer spending which caused sales to decline by 35% in 2009 and 30% in 2010. Brunschwig & Fils is a century-old distributor of wall coverings and upholstery fabrics. Brunschwig has 17 showrooms in the U.S. and three abroad. It offers 17,000 fabrics and 1,200 wall coverings. Company showrooms are open to the trade only. Brunschwig & Fils filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 11-22036) in White Plains, New York on Jan. 12, 2011. Alan D. Halperin, Esq., at Halperin Battaglia Raicht LLP, in New York, represents the Debtor in its chapter 11 effort. The Debtor estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. BRUNSCHWIG & FILS: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Brunschwig & Fils, Inc. 75 Virginia Road North White Plains, NY 10603 Bankruptcy Case No.: 11-22036 Chapter 11 Petition Date: January 12, 2011 Court: U.S. Bankruptcy Court Southern District of New York (White Plains) Judge: Robert D. Drain Debtor's Counsel: Alan D. Halperin, Esq. HALPERIN BATTAGLIA RAICHT LLP 555 Madison Avenue, 9th Floor New York, NY 10022 Tel: (212) 765-9100 Fax: (212) 765-0964 E-mail: ahalperin@halperinlaw.net 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 T. Olivier Peardon, president. CARGO TRANSPORTATION: Files for Ch. 11 After Dispute with Lender ---------------------------------------------------------------- Sunrise, Florida-based Cargo Transportation Services, Inc., filed for Chapter 11 protection on Jan. 12, 2011 (Bankr. M.D. Fla. Case No. 11-00432), estimating assets of $50 million to $100 million and debts of $10 million to $50 million. No customary "first day" motions were filed by the Debtor other than an emergency motion for access to cash collateral. The Debtor is a Florida corporation that provides comprehensive transportation services to clients nationwide, including customized consolidation, distribution, logistics and warehousing services. The Debtor employs approximately 140 employees and averages $100,000,000 in gross revenue per year. The Debtor says it has 200 trucks delivering more than 1,100 shipments to customers. "Unfortunately, the drivers currently do not have money to buy fuel because Comerica Bank, relying on technical non-monetary defaults that the Debtor disputes, has refused to allow the Debtor to use its cash. Accordingly, the Debtor had no choice but to file this bankruptcy petition," said Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain & Prosser, PA, in Tampa, Florida, counsel to the Debtor. The Debtor is requesting that the Bankruptcy Court order Comerica Bank to allow the Debtor to use cash collateral to avoid immediate and irreparable harm. $7.9 Million Debt Pursuant to a Master Revolving Note dated May 17, 2010, the Debtor has a $10.5 million line of credit with Comerica Bank secured by the Debtor's accounts receivable. Relying on technical nonmonetary defaults that are disputed by the Debtor, on January 10, 2011, Comerica unilaterally seized the Debtor's monies in its bank accounts and has since been collecting 100% of the Debtor's accounts receivable, Mr. Peterson relates. He said that the amount collected by the Lender to date is $1.7 million. The current balance due to the Lender is $7.9 million. The total outstanding receivables are in excess of $9.5 million. In the event that the Lender asserts a lien on Cash Collateral, in exchange for the Debtor's ability to use Cash Collateral in the operation of its business, the Debtor proposes to grant, as adequate protection, to the petitioning Lender a replacement lien equal in extent, validity, and priority to the lien held by the Lender as of the Petition Date. The Debtor asserts that any interests of Lender will be adequately protected by replacement liens. "If allowed to use Cash Collateral, the Debtor believes that it can stabilize its business operations and maintain going concern value. Otherwise, the Debtor's business operations will cease and its assets will have only liquidation value," Mr. Peterson relates. CARGO TRANSPORTATION: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Cargo Transportation Services, Inc. 1300 Sawgrass Corporate Parkway, Suite 110 Sunrise, FL 33323 Bankruptcy Case No.: 11-00432 About the Company: The Debtor is a Florida corporation that provides comprehensive transportation services to clients nationwide, including customized consolidation, distribution, logistics and warehousing services. The Debtor has 140 employees and averages $100,000,000 in gross revenue per year. Chapter 11 Petition Date: January 12, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Judge: Michael G. Williamson Debtor's Counsel: Edward J. Peterson, III, Esq. STICHTER, RIEDEL, BLAIN & PROSSER, PA 110 East Madison Street, Suite 200 Tampa, FL 33602 Tel: (813) 229- 0144 Fax: (813) 229-1811 E-mail: epeterson@srbp.com Estimated Assets: $50,000,001 to $100,000,000 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 David Bell, president. CARIAN MANAGEMENT: To Present Plan for Confirmation on March 9 -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Puerto Rico entered on December 3, 2010, its order approving the disclosure statement explaining Carian Management, Inc.'s proposed Plan of Reorganization. With the approval of the disclosure statement, the Debtor may now commence the solicitation of acceptances of its Plan of Reorganization. The hearing to consider the confirmation of the Plan will be held on March 9, 2011, at 9:00 a.m. at the U.S. Post Office and Courthouse Building, Courtroom 3, 300 Del Recinto Street, Old San Juan, Puerto Rico. Any objection to confirmation of the Plan will be filed on or before seven days prior to the date of the hearing on confirmation of the Plan. Within seven working days before the hearing on confirmation, the Debtor will file with the Court its statement setting forth compliance with each of the requirements of Section 1129 of the Bankruptcy Code, the acceptances and rejections, and the computation of the same. As reported in the Troubled Company Reporter on November 1, 2010, the Plan will be substantially supported by the Debtor's operations and the possible sale or surrender of assets in payment to the Debtor's creditor Banco Popular de Puerto Rico if necessary to ensure the Debtor's operation. With respect to the secured claim of Banco Popular, the two outstanding term loans (with a total outstanding balance of $11,963,632), that are secured by the Debtor's real property, will be combined into a single term loan up to the value of the collateral with an amortization period of 30 years and an interest rate of the prime rate plus 1%. The obligation is secured up to an amount of $11,892,000. The remaining portion of the obligation will be treated as unsecured. The secured claim of CRIM ($166,369) will be paid over the course of 72 monthly payments plus interest at the prime rate. With respect to general unsecured claims aggregating $5,965,721, AAA Imports, Inc., will take on the $4,855,504 revolving loan to Westernbank. Carian will accept responsibility for AAA Imports' obligation as an unsecured debt but will not make any payments on the obligation unless AAA Imports defaults. With respect to the remaining claims, the Debtor will distribute a dividend of 10% on all claims paid over the course of 72 months from the effective date. About Carian Management, Inc. Dorado, Puerto Rico-based Carian Management, Inc.'s prime business is the ownership, maintenance and development of the real property that it leases to its sister company, AAA Imports and other customers. The Company filed for Chapter 11 protection on May 13, 2010 (Bankr. D. P.R. Case No. 10-04052). Carmen D. Torres, Esq., at the Law Offices of C. Conde, assists the Debtor in its restructuring effort. The Company estimated assets and debts at $10 million to $50 million as of the petition date. The Company's affiliate, AAA Imports, Inc., filed a separate Chapter 11 petition on May 12, 2010. CATHOLIC CHURCH: Milwaukee Proposes KCC as Noticing Agent --------------------------------------------------------- The Archdiocese of Milwaukee seeks permission from the United States Bankruptcy Court for the Eastern District of Wisconsin to employ Kurtzman Carson Consultants LLC as its notice, plan solicitation, and balloting agent, subject to that certain agreement for services, dated as of December 23, 2010, between the parties. As noticing agent, KCC will: (a) prepare and serve required notices in the Chapter 11 case, including notice of the commencement of the case and the claims bar date; (b) maintain an up-to-date mailing list of all creditors and all entities, who have filed requests for notices in the case and provide the list to the Court or any interested party upon request; (c) comply with applicable federal, state, municipal, and local statutes, ordinances, rules, regulations, orders and other requirements; (d) promptly comply with further conditions and requirements as the Clerk's Office or the Court may at any time prescribe; and (e) assist with, among other things, maintaining and updating the master mailing lists of creditors, gathering data in conjunction with the preparation of the Archdiocese's schedules of assets and liabilities, and statements of financial affairs. KCC will be paid for its services, expenses and supplies at the rates or prices it sets and in effect as of the date of the Services Agreement in accordance with the KCC Fee Structure. The Archdiocese will also reimburse KCC for its reasonable out of pocket expenses incurred in connection with the retention. Albert Kass, KCC's Vice President of Corporate Restructuring Services, assures Judge Kelley that KCC neither holds nor represents any interest materially adverse to the estate in connection with any matter on which it would be employed, and that it is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. * * * The Court authorized the Archdiocese to employ KCC as notice, plan solicitation and balloting agent. The terms of the Services Agreement are also approved subject to these modifications: -- KCC is not authorized to establish accounts with financial institutions in the name of, and as agent for, the Archdiocese; -- KCC is not authorized to assist the Archdiocese in preparation of the schedules of assets and liabilities, and statements of financial affairs; -- KCC is authorized to provide other noticing, solicitation and administrative services that the Archdiocese may request from time to time; and -- KCC is authorized to provide noticing services in the bankruptcy case to the U.S. Trustee. About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on January 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: Milwaukee Proposes O'Neil as Special Counsel ------------------------------------------------------------- The Archdiocese of Milwaukee seeks permission from the United States Bankruptcy Court for the Eastern District Wisconsin to employ O'Neil, Cannon, Hollman, DeJong & Laing S.C. as its special counsel under a general retainer in connection with certain real estate matters, which O'Neil Cannon historically handles for the Archdiocese. The Archdiocese's proposed lead counsel, Whyte Hirschboeck Dudek S.C., will determine and assign discrete matters to O'Neil Cannon in a manner that will avoid duplication of legal services, John J. Marek, treasurer and chief financial officer of the Archdiocese, tells the Court. He adds that to the extent any matter will necessarily involve both O'Neil Cannon and Whyte Hirschboeck, the services that O'Neil Cannon will provide will be complementary to rather than duplicative of the services to be performed by Whyte Hirschboeck. The O'Neil Cannon professionals, who will be handling the Archdiocese's case and their current standard hourly rates, are: Hourly Professional Rate/Range ------------ ---------- John G. Gehringer $325 Seth E. Dizard $295 William A. Wiseman $320 J. Miles Goodwin $295 Robert J. Tess $240 John R. Schreiber $240 Madonna L. Ravet $135 Shareholders $230 - $380 Senior Attorney $295 - $320 Associates $165 - $260 Paralegals $135 O'Neil Cannon will also be reimbursed for its necessary expenses incurred in connection with the retention. The firm received a $25,000 prepetition advance, which remains to be applied to its services for the Archdiocese, discloses Mr. Marek. The estimated fee for the services to be provided by O'Neil Cannon to the Archdiocese will be $100,000, barring currently unforeseen circumstances, he adds. John G. Gehringer, Esq., a shareholder at O'Neil Cannon, assures Judge Kelley that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on January 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: PETA Offers Milwaukee Cash in Exchange of Statue ----------------------------------------------------------------- PETA sent a letter to The Most Rev. Jerome E. Listecki, archbishop of Milwaukee, with an offer that could help the archdiocese not only ease its financial woes somewhat but also rebuild its image as a force for positive change: display a statue -- furnished by PETA -- that depicts Jesus holding a lamb and bears the inscription "Blessed Are the Merciful -- Go Vegan," and PETA will pay the church hard cash. PETA's offer comes on the heels of reports that the archdiocese has filed for Chapter 11 bankruptcy as a result of extensive litigation surrounding sex scandals. In the letter, PETA points out that Jesus would be appalled to witness today's treatment of God's animals who are raised and killed for food. "Factory farms and slaughterhouses are hell for animals," says PETA Vice President Bruce Friedrich, a Roman Catholic. "We're asking the archbishop to do the Christian thing and encourage members of the archdiocese to live a healthier, more humane life and show the ultimate mercy to God's creations by going vegan." PETA's letter to Archbishop Listecki: January 6, 2011 The Most Reverend Jerome E. Listecki Archbishop of Milwaukee Your Excellency, I am writing on behalf of People for the Ethical Treatment of Animals (PETA) and our more than 2 million members and supporters to express our condolences regarding your recent bankruptcy announcement and to suggest a partnership into the future that would put your diocese in the news for something laudable and forward-thinking. One thing I love about being Catholic is the Church's focus on service, especially to the meekest among us. That is why PETA would like to offer to erect a statue on the grounds of the Archdiocese's headquarters depicting Jesus holding a lamb, with an inscription reading, "Blessed Are the Merciful. Go Vegan." Please see the attached artwork for a better idea of what we are suggesting. We hope that you like it and see its inherent value for the Church, but we would also be happy to pay a reasonable sum, which will help a bit as the diocese restructures its finances. The routine treatment of animals in today's meat, dairy, and egg industries goes against everything that Holy Mother Church stands for: Chickens and turkeys routinely have their throats cut while they are still conscious, piglets have their tails and testicles removed without any painkillers, fish are suffocated or cut open while still alive on the decks of fishing boats, and terrified calves are torn away from their bellowing mothers just hours after birth. When Pope Benedict XVI (then Cardinal Ratzinger) was asked about the rights of animals in a 2002 interview, he denounced the institutionalized cruelty of factory farming, saying: Animals, too, are God's creatures . . . . Certainly, a sort of industrial use of creatures, so that geese are fed in such a way as to produce as large a liver as possible, or hens live so packed together that they become just caricatures of birds, this degrading of living creatures to a commodity seems to me in fact to contradict the relationship of mutuality that comes across in the Bible. Our statue would honor Christ's message of service and compassion and help demonstrate that the church is a force for positive change. I would be honored to hear from you if you would like to discuss our offer further. Thank you for your consideration. In Christ's light, Bruce Friedrich Vice President About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on January 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: St. Dennis Plea to Use Insurance Denied -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware denied, without prejudice, the request for relief from the automatic stay filed by St. Dennis' Roman Catholic Church, for the reasons stated on the record at the hearing on the request held on January 3 and continued on January 4, 2011. St. Dennis' Roman Catholic Church asked the U.S. Bankruptcy Court for the District of Delaware for relief from the automatic stay to allow the use of proceeds from insurance policies, under which the Catholic Diocese of Wilmington, Inc., is named as a co-insured, to fund any settlement reached between St. Dennis and Joseph Curry in the case filed in the Superior Court for the State of Delaware in and for New Castle County and styled Joseph Curry v. Catholic Diocese of Wilmington, Inc. and St. Dennis' Roman Catholic Church (C.A. No. 08C-07-239 (CLS)). The filing of the Diocese's bankruptcy petition stayed the State Court Action with respect to the Diocese, relates William D. Sullivan, Esq., at Sullivan Hazeltine Allinson LLC, in Wilmington, Delaware. He adds that on February 4, 2010, the Bankruptcy Court entered an order extending the automatic stay to certain other non-debtor entities, including the Parish. About the Diocese of Wilmington The Diocese of Wilmington covers Delaware and the Eastern Shore of Maryland and serves about 230,000 Catholics. The Delaware diocese is the seventh Roman Catholic diocese to file for Chapter 11 protection to deal with lawsuits for sexual abuse. Previous filings were by the dioceses in Spokane, Washington; Portland, Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and San Diego, California. The bankruptcy filing automatically stayed eight consecutive abuse trials scheduled in Delaware scheduled to begin October 19. There are 131 cases filed against the Diocese, with 30 scheduled for trial. The Diocese filed for Chapter 11 on Oct. 18, 2009 (Bankr. D. Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Diocese. The Ramaekers Group, LLC, is the financial advisor. The petition says assets range $50,000,001 to $100,000,000 while debts are between $100,000,001 to $500,000,000. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on January 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CEDAR FAIR: Moody's to Keep 'Ba3' Rating Amid Q Funding Proposal ---------------------------------------------------------------- Moody's Investors Service said Cedar Fair, L.P.'s Ba3 Corporate Family Rating and stable rating outlook are not affected by unit holder approval of Q Funding's proposal to adopt a change to the Partnership Agreement to separate the roles of Chairman and CEO and potential approval of a second proposal to prioritize distributions to unit holders. The last rating action was on May 20, 2010, when Moody's changed Cedar Fair's rating outlook to stable from negative, upgraded the speculative-grade liquidity rating to SGL-2 from SGL-3, and assigned a Ba2 senior secured credit facility rating, and B2 senior unsecured note rating in conjunction with a proposed refinancing of the capital structure. Moody's commented on July 15, 2010, that Cedar Fair's revised financing structure did not affect the company's ratings and indicated on October 15, 2010, that Q Funding's proxy filing did not affect Cedar Fair's ratings. Cedar Fair's ratings were assigned by evaluating factors Moody's believes 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 Cedar Fair's core industry and Cedar Fair's ratings are believed to be comparable to those of other issuers of similar credit risk. Cedar Fair, headquartered in Sandusky, Ohio, is a publicly traded Delaware master limited partnership (MLP) formed in 1987 that owns and operates 11 amusement parks, seven water parks (six outdoor and one indoor) and hotels in North America. Properties are located in the U.S. and Canada and include Cedar Point, King's Island, Knott's Berry Farm, and Canada's Wonderland. In June 2006, Cedar Fair, L.P., completed the acquisition of Paramount Parks, Inc., from a subsidiary of CBS Corporation for a purchase price of $1.24 billion. Cedar Fair's revenue for the LTM ended September 26, 2010, was approximately $953 million. CENTRALIA OUTLETS: Final Hearing on Cash Collateral Use Set Feb. 3 ------------------------------------------------------------------ As reported in the Troubled Company Reporter on December 14, 2010, the U.S. Bankruptcy Court for the Western District of Washington granted interim approval of (i) Centralia Outlets, LLC's use of cash collateral, through February 7, 2011, and (ii) adequate protection in favor of Sterling Savings Bank, in the form of monthly interest payments and a lien against postpetition leases and the rents and other income therefrom. On January 4, 2011, the Court gave notice that a final hearing on the cash collateral motion of Centralia Outlets, LLC, will be held on February 3, 2011. Oppositors to the Debtor's motion for authority to use cash collateral have until January 27, 2011, to file their written response with the court clerk, serve two copies on the Judge's chambers and deliver copies to Bush Strout & Kornfel, counsel for the Debtor. The Debtor's counsel may be reached at: James L. Day, Esq. BUSH STROUT & KORNFEL LLP 5000 Two Union Square 601 Union Street Seattle, WA 98101-2373 Tel: (206) 292-2110 Fax: (206) 292-2104 As of December 2, 2010, the Debtor owed the Bank $24,268,584. Tacoma, Washington-based Centralia Outlets LLC is the owner of the Centralia Factory Outlets mall in Centralia, Washington. The Debtor filed for Chapter 11 protection on Dec. 3, 2010 (Bankr. W.D. Wash. Case No. 10-24529), after receiving an order sending the mall to receivership. James L. Day, Esq., at Bush Strout & Kornfeld, in Seattle, Washington, represents the Debtor. The Debtor estimated assets and debts of $10 million to $50 million. CENTRALIA OUTLETS: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Centralia Outlets LLC 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 $28,825,000 B. Personal Property $381,999 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $23,985,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $14,507 ----------- ----------- TOTAL $29,206,999 $23,999,507 A full-text copy of the Schedules of Assets and Liabilities is available for free at: http://bankrupt.com/misc/CentraliaOutletsSAL.pdf Tacoma, Washington-based Centralia Outlets LLC is the owner of the Centralia Factory Outlets mall in Centralia, Washington. The Debtor filed for Chapter 11 protection on Dec. 3, 2010 (Bankr. W.D. Wash. Case No. 10-24529), after receiving an order sending the mall to receivership. James L. Day, Esq., at Bush Strout & Kornfeld, in Seattle, Washington, represents the Debtor. The Debtor estimated assets and debts of $10 million to $50 million. CENTRIX FINANCIAL: Suit vs. Insurers Stays in Bankruptcy Court -------------------------------------------------------------- District Judge Philip A. Brimmer denied the insurer defendants' demand for jury trial and motion for withdrawal of the reference to the bankruptcy court of the action, Centrix Financial, LLC, et al., Centrix Financial Liquidating Trust, and Jeffrey A. Weinman in his capacity as Trustee for the Centrix Financial Liquidating Trust, v. National Union Fire Insurance Company of Pittsburgh, Pa., and AIG Domestic Claims, Inc., Case No. 09-cv-01542 (D. Colo.). Judge Brimmer held that the Adversary Proceeding appears to be in its initial stages and the Bankruptcy Court is in a better position to oversee the discovery process. Judge Brimmer noted that the plaintiffs' claim for insurance will largely overlap with the facts underlying a case against Centrix employees and officers. In September 2008, plaintiffs sued Robert E. Sutton and numerous other defendants, alleging that Mr. Sutton engaged in a series of fraudulent schemes that ultimately bankrupted the Debtors. Certain of the Sutton Proceeding defendants filed a motion to withdraw the reference, which the District Court granted in part and denied in part on June 8, 2009, declining to immediately withdraw the reference. In re Centrix Financial, LLC, No. 09-cv-0088-PAB, 2009 WL 1605826 (D. Colo. June 8, 2009). Prior to the Sutton Proceeding, the insurer defendants filed a proof of claim in the bankruptcy court on June 18, 2007. Part of that claim related to an insurance policy -- Fidelity Bond -- issued by the defendants to Centrix, covering losses resulting from wrongful acts by Centrix employees and officers. Plaintiffs did call upon the defendants to pay on the Fidelity Bond. The defendants did not pay the insurance claim. A copy of the District Court's January 7, 2011 Order is available at http://is.gd/Byf4HFfrom Leagle.com. About Centrix Financial Based in Reno, Nevada, Centrix Financial LLC was a subprime auto lender. Three of Centrix Financial's creditors, IFC Credit Corporation, Suntrust Leasing, and Wells Fargo Equipment Finance, filed an involuntary chapter 11 petition against the Debtors (Bankr. D. Colo. Case No. 06-16403) on Sept. 15, 2006, alleging more than $4.6 million owed. Lee M. Kutner, Esq., at Kutner Miller, P.C., and David von Gunten, Esq., at Von Gunten Law LLC, represented the petitioners. Centrix and some affiliates filed voluntary Chapter 11 petitions (Bankr. D. Nev. Case No. 06-50631) on Sept. 19, 2006. CMGN LLC, another affiliate, filed its Chapter 11 petition (Bankr. D. Nev. Case No. 06-50631) on Sept. 4, 2006. The Debtors' cases were consolidated and transferred (Bankr. D. Colo. Case No. 06-16403) on Sept. 27, 2006. Craig D. Hansen, Esq., Thomas J. Salerno, Esq., and Sean T. Cork, Esq., at Squire, Sanders & Dempsey, L.L.P.; and Lawrence Bass, Esq., and Elizabeth K. Flaagan, Esq., at Holme Roberts & Owen LLP, represent the Debtors. The Official Committee of Unsecured Creditors was represented by Douglas W. Jessop, Esq., and Kerstin E. Kass, Esq., at Jessop & Company, P.C., and Michael P. Richman, Esq., at Foley & Lardner LLP. Kurtzman Carson Consultants LLC was the Debtors' claims agent. In it Schedules filed with the Court, Centrix Financial disclosed total assets of $23,928,171 and total debts of $109,189,359. On February 6, 2007, the Bankruptcy Court authorized the sale of substantially all of the Debtors' assets. In late 2007, the Debtors proposed a liquidating chapter 11 plan, and the Honorable Elizabeth E. Brown confirmed that plan in early 2008. The Centrix Liquidating Trust was created under that chapter 11 plan and Jeffrey A. Weinman was appointed the liquidating trustee. CHINA VILLAGE: Court Sets February 18 Disclosure Statement Hearing ------------------------------------------------------------------ China Village, LLC, filed on January 2, 2011, its Chapter 11 Plan of Reorganization and explanatory disclosure statement with the U.S. Bankruptcy Court for the Northern District of California. The Bankruptcy Court set a hearing for February 18, 2011, at 2:00 p.m. to consider the approval of the adequacy of the Disclosure Statement. Objections to the Disclosure Statement must be filed and served no later than seven days prior to the hearing. Upon approval of the Disclosure Statement, the Debtor may commence solicitation of votes for acceptance of the Plan. The Plan contemplates the sale of the Property at anytime during the term of the Plan, which is three years. At the conclusion of the three year term, if Debtor is current in its interest payments on the C-2 Claim of Cathay Bank, and is otherwise in compliance with the terms of this Plan, Debtor will have the option to automatically extend the Term of the Plan for an additional two year period. To the extent that such payments are to be funded by Redwood Mortgage, the consent of Redwood Mortgage to any extension will be required. Redwood Plan Funding One of the key components of the Plan involves funding by Redwood Mortgage, which holds a second position deed of trust in the Debtor's Property in the amount of $13,500,000. The funding will be used to pay specified claims in the bankruptcy case. Pursuant to the terms and conditions of the Redwood Plan Funding, Redwood Mortgage will advance to the Reorganized Debtor up to the sum of $1,000,000 over 36 months from the Effective Date of the Plan, subject to the Debtor obtaining not less than 50% lease occupancy within 18 months of the Effective Date and 75% lease occupancy as of 36 months after the Effective Date. The Advance Funds can only be used for (i) monthly interest only payments to Cathay Bank pursuant to the treatment of the claim of Cathay Bank as set forth in the Plan; (ii) daily and ordinary repairs to the Property, subject to approval by Redwood Mortgage; and (iii) third party leasing commissions, also subject to approval by Redwood Mortgage. In consideration for the Redwood Plan Funding, Redwood Mortgage will be paid the following amounts from the sale of the Property. After payment of any outstanding property taxes, the secured claims of Cathay Bank and Redwood Mortgage, out of the remaining proceeds, Redwood will be paid the following percentage of the Proceeds: 25% of the Proceeds if the Property is sold within one year from the Effective Date of the Plan; 50% of the Proceeds if the Property is sold at any time between one year and one day after the Effective Date through and including the end of year three; and 75% of the Proceeds should a sale occur in years four and five after the Effective Date. In the event of a refinance, then Redwood Mortgage will be paid a sum calculated in accord with the foregoing, based on a hypothetical sale of the Property at its then appraised value. Administrative Claims under Class A, Priority Claims under Class B, Real Property Tax Claims under Class C-1 and Claims of Members under Class E are unimpaired. Class A claims will be paid in full, in cash, on the Effective Date of the Plan. Class B claims will be paid be paid in full, in cash, on or prior to the due date for payment of such claims. The Class C-1 property taxes are current. Future property taxes will be paid on a current basis as they become due from rental income from the Property. In the event that all claims are paid in full, Class E members, currently comprised of three members of Debtor, will retain their interests without impairment. The secured claim of Cathay Bank under Class C-2, owed in the principal amount of $22,300,000 in addition to any unpaid and accrued interest and other costs claimed, will receive monthly interest-only payments for a period of 3 years from the Redwood Plan Funding. The balance of the Class C-2 Claim will be due and payable three years after the Effective Date of the Plan, with such payment to be made from the sale or refinance of the Property, or from contributions from a member or new member. The secured claim of Redwood Mortgage under Class C-3, including amounts funded by Redwood Mortgage pursuant to the Plan, will be treated pursuant to the terms of the Redwood Plan Funding. The Class C-3 Claim, including the principal balance, accrued costs, interest, and amounts funded pursuant to the Redwood Plan Funding, will be due and payable three years after the Effective Date of the Plan, with such payment to be made from the sale or refinance of the Property, or from contributions from a member or new member. The secured claim of Sarabjit Hundal under Class C-4, owed in the principal amount of $1,000,000, and the secured claim of Gurdip Sekhon under Class C-5, owed in the principal amount of $1,000,000, will be due and payable three years after the Effective Date of the Plan. Unsecured Claims under Class D will be paid three years from the Effective date of the Plan from proceeds from the sale or refinance of the Property, or from contributions from a member or new member. If Class D Allowed Claims are paid in full, claims within this category will be entitled to interest. However, if the means for providing payment to Class D Claims are not sufficient for a 100% dividend, then Class D claims will not receive interest and the payment to Class D Claimants will be made on a pro-rata basis from available assets. If Class D Allowed Claims are not paid in full, the portion of the unpaid balance of each Class D Allowed Claim will be discharged. Classes C-2, C-3, C-4, C-5, and D are all impaired under the Plan, and are entitled to vote. A copy of the disclosure statement in support of the Chapter 11 Plan of Reorganization, dated December 30, 2010, is available at no charge at: http://bankrupt.com/misc/ChinaVillageDS.pdf About China Village, LLC Milpitas, California-based China Village, LLC, is a limited liability company that company that was created on May 10, 2005. The members of Debtor are Thomas Nguyen, the Responsible Individual in this case (8%), Joseph Nguyen (9%) and Tuyet Minh Le (83%). The Debtor is in the business of purchasing, leasing, renovating and selling commercial real property. The Debtor currently owns a significant commercial property in Fremont, California, that has 370,019 square feet of rentable space on 25.07 acres of land. China Village filed for Chapter 11 bankruptcy protection on October 4, 2010 (Bankr. N.D. Calif. Case No. 10-60373). Lawrence A. Jacobson, Esq., Sean M. Jocobson, Esq., at Cohen And Jacobson, LLP, assists the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $10 million to $50 million as of the Petition Date. CIELO APARTMENTS: Courts Grants Debtor's Motion to Dismiss Case --------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of North Carolina, approved on January 10, 2011, the motion of Cielo Apartments, LLC, for the dismissal of its Chapter 11 case. Pursuant to an agreement between the Debtor and Bank of America, N.A., the Court granted BOA relief from the automatic stay in an order entered December 22, 2010. In addition, BOA has or will pay certain funds to the Debtor under the terms of the parties' agreement and the Stay Relief Order. As substantially all prepetition assets of the Debtor's bankruptcy estate will be liquidated in accordance with the Stay Relief Order, the Court finds that the Debtor's remaining assets, including the Settlement Funds, will just be eroded by further administration of the bankruptcy case, and that continuation of the case under these circumstances will necessarily burden the estate with additional costs and expenses to the detriment of the Debtor's remaining creditors. About Cielo Apartments, LLC Charlotte, North Carolina-based Cielo Apartments, LLC, owns, leases and operates an apartment building located at 4943 Park Road, Charlotte, North Carolina. Cielo Apartments filed for Chapter 11 bankruptcy protection on December 3, 2010 (Bankr. W.D. N.C. Case No. 10-33570). Glenn C. Thompson, Esq., at Hamilton Moon Stephens Steele & Martin, serves as the Debtor's counsel. The Debtor estimated its assets and debts at $10 million to $50 million. COLUMBUS MCKINNON: S&P Affirms 'BB-' Corporate Credit Ratings ------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit ratings on Amherst, N.Y.-based Columbus McKinnon Corp. At the same time, S&P assigned its 'B+' issue-level rating to the Company's proposed $150 million new senior subordinated notes due 2019. The recovery rating on this debt is '5', indicating S&P's expectation for modest recovery (10-30%) in the event of a payment default. The outlook remains stable. "The ratings on Columbus McKinnon reflect our expectation that the Company's credit measures will improve from currently weaker-than- expected levels for the rating and return to levels more commensurate with our expectations by the end of fiscal 2012, including adjusted debt to EBITDA of 4x or less," said Standard & Poor's credit analyst Peter Kelly. "In particular, we expect that improvements in the Company's operations and end markets will benefit profitability. We assume that adjusted operating margins will strengthen to the low teens, up from about 7% at the end of second-quarter 2011. Although free operating cash flow could be limited in fiscal 2011, the Company's $57 million cash balance as of Sept. 30, 2010, and our expectation for adequate covenant headroom under its revolver following a recent amendment support the Company's liquidity." The outlook is stable. While S&P expects credit measures to remain somewhat weak for S&P's expectations, with adjusted financial leverage likely to remain around 5x debt to EBITDA at fiscal year-end 2011, S&P believes credit measures will improve in fiscal 2012. S&P's rating assumes that end-market demand and operational efficiencies will support the recovery of adjusted operating margins towards the low teens, up from about 7% at the end of second-quarter 2011. This would translate into credit measures more in line with S&P's expectations, including adjusted debt to EBITDA of 4x or less and FFO to total debt of more than 15%. "We could lower the ratings if flattish revenue performance or manufacturing inefficiencies delay the expected recovery in operating profitability, or lead to subpar free cash flow generation," Mr. Kelly continued. "This could happen for instance if operating margins become likely to remain below 10% for an extended period, since this could cause adjusted FFO to total debt to remain below 15%. S&P consider an upgrade in the next year or two as unlikely, because of the Company's weak business risk profile and its currently subpar credit protection measures." COMPASS DIVERSIFIED: Moody's Affirms 'Ba3' Corporate Rating ----------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to Compass Diversified Holding's $325 million senior secured revolving credit facility and a B1 rating to the $200 million senior secured term loan. At the same time, Moody's affirmed the Ba3 corporate family rating, B1 probability of default rating and SGL 2 speculative grade liquidity rating. The rating outlook remains stable. Ratings on the existing term loan and revolver will be withdrawn upon closing of the transaction. The proceeds are expected to be used to repay amounts outstanding under the existing senior secured credit facility and to fund future acquisitions. "Compass has historically financed its acquisitions through revolver draw downs that were later repaid with operating cash flow," said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. "We expect this practice to continue after the company deploys the $95 million of proceeds from the offering," he added. Based on September 2010 information, proforma for the refinancing and $70 million equity offering in November 2010, the company would have no revolver borrowings, $200 million of funded debt outstanding and almost $115 million of cash. The Ba3 corporate family rating reflects the company's strong industry diversification, low financial leverage and good interest coverage. The rating also benefits from the company's size with revenue around $1.6 billion, strong geographic diversification throughout the US and strong operating and financial controls over its subsidiaries. In addition to distributing the majority of its operating cash flow to shareholders, the rating is constrained by the uncertain economy, the extreme earnings volatility in its staffing business and by fluctuating operating margins in most of its other businesses. The Ba1 rating for the revolver and the B1 term loan rating reflect both the overall probability of default of the company, to which Moody's assigns a PDR of B1, and a loss given default of LGD 2, 13%, for the revolver and LGD 4, 56%, for the term loan. The term loan contains a "last out" provision whereby any payments, including in liquidation, are required to be applied to the revolver before the term loan. The term loan and revolver are issued by Compass Diversified Holdings and are not guaranteed by its operating subsidiaries, but are secured on a first lien basis by Compass' assets, including intercompany loans, which are secured on a first lien basis by each subsidiary's assets. Because of the "last out" provision, the revolver is ranked ahead of the term loan in Moody's LGD notching template. The stable outlook reflects Moody's expectation that despite the weak job market and continuing uncertainty in discretionary consumer spending, Compass will continue generating free cash flow in the fourth quarter of 2010 as it did in the third quarter and that it will maintain financial leverage between 2x and 3x and interest coverage around 4x. Moody's expectation that the company will continue to distribute a substantial portion of its free cash flow, but will not increase leverage to fund a distribution is reflected in the outlook. Reducing leverage after an acquisition with operating cash flow is critical to the outlook. There is minimal near term upward rating momentum due to the continuing weak economy and mounting raw material price pressure. A positive outlook could be considered over the longer term if Compass continues to demonstrate good execution of its business strategy, increases its international diversification, does not become concentrated in any one industry through additional acquisitions, and is able to improve its operating performance beyond previous levels. In addition to these factors, a significant increase in revenue and moderation of shareholder payouts would be necessary for an upgrade. Key credit metrics driving potential upward ratings pressure would be improving operating margins to the low double digits and consistent generation of free cash flow with FCF/adjusted debt of at least 20%. While not likely, downward rating pressure could arise if the company revises its business strategy and targets acquisitions that do not have stable cash flow or if Compass increases its concentration in any one industry. A large debt funded dividend or share repurchase would also pressure the ratings. Key credit metrics driving potential downward ratings pressure would be adjusted leverage approaching 4x for a sustained period, and interest coverage below 3. Failure to improve operating margins or a return to the consumption of cash could also result in negative rating actions. The following ratings were assigned: -- $325 million revolving credit facility maturing in January 2016 at Ba1 (LGD 2, 13%); -- $200 million term loan maturing in January 2017 at B1 (LGD 4, 56%); The following ratings were affirmed: -- Corporate Family Rating at Ba3; -- Probability of Default Rating at B1; -- Speculative grade liquidity rating at SGL 2 Moody's subscribers can find further details in the Compass Credit Opinion published on Moodys.com The last rating action was on September 25, 2009, where Moody's downgraded the speculative grade liquidity rating to SGL 2 from SGL 1. The principal methodology used in rating Compass was Moody's Special Comment, "Analytical Considerations in Assessing Conglomerates" published in September 2007, the Global Consumer Durables rating methodology published in October 2010 and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found on Moody's website. Compass' business strategy is to acquire and manage businesses that operate in industries with long-term macroeconomic growth opportunities, have positive and stable cash flows, face minimal threats of technological or competitive obsolescence and have strong management teams largely in place. The company holds majority ownership interests in eight distinct unrelated operating subsidiaries: Advanced Circuits, American Furniture Manufacturing, Anodyne Medical Devices, Fox Factory, Halo Branded Solutions, Staffmark, Liberty Safe and ERGObaby. Its strategy is to acquire and manage businesses that operate in industries with long term macroeconomic growth opportunities and have positive and stable cash flows. The company reported revenue of approximately $1.6 billion for the twelve months ended September 30, 2010. COMSTOCK MINING: Deloitte Hired to Audit Financial Statements ------------------------------------------------------------- On January 4, 2011, the Audit and Finance Committee of the Board of Directors of Comstock Mining Inc., upon completion of a formal selection process, approved the selection of Deloitte & Touche LLP as its independent, registered public accounting firm to audit the consolidated financial statements of the Company for the fiscal year ended December 31, 2010. On January 4, 2011, the Company dismissed Jewett, Schwartz, Wolfe & Associates as its independent registered public accounting firm. The reports of JSWA on the consolidated financial statements of the Company as of and for the fiscal years ended December 31, 2009 and 2008 did not contain any adverse opinion or disclaimer of opinion. These reports were not qualified or modified as to uncertainty, audit scope or accounting principles. During the fiscal years ended December 31, 2009 and 2008 and during the period between December 31, 2009 and January 4, 2011, there were no disagreements between JSWA and the Company on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of JSWA, would have caused JSWA to make reference to the subject matter of the disagreements in connection with their reports. Furthermore, during the fiscal years ended December 31, 2009 and 2008 and during the period between December 31, 2009 and January 4, 2011, there were no reportable events. During the fiscal years ended December 31, 2009 and 2008 and during the period between December 31, 2009 and January 4, 2011, neither the Company nor anyone on its behalf consulted Deloitte regarding (i) either: the application of accounting principles to a specified transaction; or the type of audit opinion that might be rendered on the Company's consolidated financial statements, and either a written report was provided to the Company or oral advice was provided that Deloitte concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue or (ii) any matter that was either the subject of a disagreement or a reportable event. About Comstock Mining Virginia City, Nev.-based Comstock Mining Inc. is a Nevada-based, gold and silver mining company with extensive, contiguous property in the historic Comstock district. The Company began acquiring properties in the Comstock in 2003. Since then, the Company has consolidated a substantial portion of the Comstock district, secured permits, built an infrastructure and brought the exploration project into test mining production. The Company continues acquiring additional properties in the Comstock district, expanding its footprint and creating opportunities for exploration and mining. The goal of the Company's strategic plan is to deliver stockholder value by validating qualified resources (measured and indicated) and reserves (probable and proven) of 3,250,000 gold equivalent ounces by 2013, and commencing commercial mining and processing operations by 2011, with annual production rates of 20,000 gold equivalent ounces. The Company's balance sheet at September 30, 2010, showed $5.6 million in total assets, $46.6 million in total liabilities, and a stockholders' deficit of $41.0 million. As reported in the Troubled Company Reporter on April 15, 2010, Jewett, Schwartz, Wolfe & Associates expressed substantial doubt about Goldspring, Inc.'s ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has operating and liquidity concerns and has incurred historical net losses approximating $55.0 million as of December 31, 2009. The Company also used cash in operating activities of $3.6 million in 2009. CONSOLIDATED PROPERTIES: Case Summary & 6 Largest Unsec Creditors ----------------------------------------------------------------- Debtor: Consolidated Properties, Inc. fka Consolidated Chemical & Refining, Inc. fdba Consolidated Chemical & Refining fdba The Grand Chapel 701 E. 2nd Street Wichita, KS 67202 Bankruptcy Case No.: 11-20066 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court District of Kansas (Kansas City) Debtor's Counsel: David P. Eron, Esq. ERON LAW OFFICE, P.A. 229 E. William, Suite 100 Wichita, KS 67202 Tel: (316) 262-5500 Fax: (316) 262-5559 E-mail: david@eronlaw.net Scheduled Assets: $2,599,000 Scheduled Debts: $1,341,201 A list of the Company's six largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ksb11-20066.pdf The petition was signed by Allen Wilkie, president. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Allen Wilkie 09-12579 08/12/2009 CONSTAR INT'L: Taps Greenhill & Co. as Financial Advisor -------------------------------------------------------- Constar International Inc., et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Greenhill & Co., LLC, s financial advisor and investment banker, nunc pro tunc to the Petition Date. Greenhill will, among other things: (a) evaluate the Debtors' debt capacity in light of its projected cash flows; (b) assist in the determination of an appropriate capital structure for the Debtors; (c) determine a range of values for the Debtors on a going concern basis; and (d) provide financial advice and assistance to the Debtors in developing and seeking approval of a restructuring plan. The Debtors have agreed to pay the firm: (a) a monthly financial advisory fee of $140,000; (b) if during the term of the Greenhill Engagement or within the 12 full months following the termination of the Greenhill Engagement, a restructuring is consummated, Greenhill will be entitled to receive a transaction fee, contingent upon the consummation of such a restructuring and payable at the closing thereof, equal to 1.50% of the principal amount of the debt that is restructured. For purposes of payment, if a restructuring is consummated as a Plan under the U.S. Bankruptcy Code, then the closing will be the effective date of the Plan; (c) if during the Fee Period, a Sale is consummated Greenhill will be entitled to receive a transaction fee, contingent upon the consummation of the Sale and payable at the closing thereof, which will be equal to 1.50% of the Aggregate Consideration; and (d) no Restructuring Transaction Fee and no Sale Transaction Fee will be payable for any Restructuring or Sale occurring after the first to be consummated of any restructuring or Sale. Bradley A. Robins, Managing Director in Greenhill, assures the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. About Constar International Philadelphia, Pennsylvania-based Constar International Inc. -- http://www.constar.net/-- produces and supplies polyethylene terephthalate plastic containers for food and beverages. Constar filed for Chapter 11 protection in December 2008 (Bankr. D. Del. Lead Case No. 08-13432), with a pre-negotiated Chapter 11 plan. The pre-negotiated plan, which reduced Constar's debt load by roughly $175 million, became effective on May 29, 2009. Attorneys at Bayard, P.A. and Wilmer Cutler Pickering Hale and Dorr LLP represented the Debtor in the case. Due to operating losses caused by a significant decline in demand for its products from Pepsi-Cola Advertising and Marketing Inc. and other customers, Constar International, together with affiliates, returned to Chapter 11 protection on January 11, 2011 (Bankr. D. Del. Case No. 11-10109), with a Chapter 11 plan negotiated with holders of 75% of the holders of $220 million in senior secured floating-rate notes. Andrew Goldman, Esq., and Dennis Jenkins, Esq., at Wilmer Cutler Pickering Hale And Dorr LLP, serve as the Debtors' general bankruptcy counsel. Jamie Lynne Edmonson, Esq., and Neil B. Glassman, Esq., at Bayard, P.A., serve as co-counsel to the Debtors. Pricewaterhouse Coopers serves as the Debtors' independent auditors and accountants. Kurtzman Carson Consultants LLC serves as the Debtors' claims agent. The Debtors disclosed $418 million in total assets and $414 million in total debts as of Sept. 30, 2010. CONSTAR INT'L: Proposes $55MM of Financing from Black Diamond ------------------------------------------------------------- Constar International Inc. and its units seek authority from the U.S. Bankruptcy Court for the District of Delaware to obtain postpetition secured financing from a syndicate of lenders led by Black Diamond Commercial Finance, L.L.C., as administrative agent. The DIP lenders have committed to provide a $55 million delayed draw term loan facility. The first disbursements will be in the aggregate principal amount of up to $38 million. In addition, the proposed DIP Facility will allow the Debtors to pay off their existing revolver and roll-over up to $15 million into post- emergence exit financing. Jamie L. Edmonson, Esq., at Bayard, P.A., explains that the Debtors need the money to fund their Chapter 11 case, pay suppliers and other parties. The DIP facility will mature on (i) 45 days after entry of an interim order approving the DIP financing, if the final court order hasn't yet been entered by that date; (ii) the date that is the lesser of (x) 206 and (y) nine months, less one day following the closing date; (iii) the substantial consummation of a plan of reorganization of the Debtors, which has been confirmed by court order; (iv) conversion into a case under Chapter 7 of the U.S. Bankruptcy Code liquidation proceeding, (v) the sale of all or substantially all of the assets of the Debtors and (vi) the acceleration of the obligations under or the termination of the DIP Note Purchase Agreement. The DIP facility will incur interest at LIBOR plus 8% (LIBOR floor of 1%) paid in cash monthly in arrears. Upon an event of default, the Rate will be increased by 2%. All obligations of the DIP Obligors to the DIP Facility Providers and the DIP Agent under the DIP Facility will be: (X) entitled to superpriority administrative expense claim status in each case; and (Y) secured by a security interest in and lien on all now owned or hereafter acquired assets and property of the Debtors, real and personal, tangible or intangible, but excluding (i) certain foreign stock, the pledge of which may lead to material tax consequences, (ii) assets owned by foreign subsidiaries, the pledge of which may lead to material tax consequences, and (iii) other exceptions set forth in the DIP note purchase agreement. The security interests in and liens on the DIP Collateral will be perfected first priority, not subject to subordination other than to permitted liens acceptable to the DIP Agent, but will be subject to the carve out. The DIP lien is subject to a carve out for U.S. Trustee and Clerk of Court fees; fees payable to professional employed in the Debtors' case; and fees of the committee in pursuing actions challenging the DIP lenders' lien. The interim and the final court order will provide that the first priority liens granted in favor of the DIP Agent, for the benefit of the DIP Facility Providers, will "prime" the existing liens. The Debtors are required to pay these fees to the Agent: (i) 1% of the total DIP Facility due and paid to the DIP Agent upon closing as an arrangement fee; (ii) 2% of the total DIP Facility due and paid to the Purchasers upon closing; (iii) 2% per annum unused commitment fee, payable monthly and in arrears; (iv) $50,000 per annum administration fee due and payable to the DIP Agent in advance and upon closing; and (v) a pre-payment fee of 4% of the portion prepaid if any portion of the DIP Facility is repaid prior to the Maturity Date; provided, however, that the prepayment fee is waived if the DIP Facility is repaid with the Facility Roll- Over Amount or otherwise in cash in connection with the Plan. Cash Collateral The Debtors also ask the Court's permission to use cash collateral until April 2011. Issuers will be authorized to use cash collateral, unless an Event of Default has occurred and the DIP Agent has directed that cash collateral may not be used. On February 11, 2010, Constar entered into the Prepetition Credit Agreement, a revolving credit facility with General Electric Capital Corporation and terminated its then existing credit agreement with Citicorp N.A. The Prepetition Credit Agreement was amended on August 12, 2010. As amended, the Prepetition Credit Agreement provides for up to $75 million of available credit, with a sublimit of up to $20 million for the issuance of letters of credit. As of November 30, Constar's borrowing base under the Prepetition Credit Agreement was approximately $46.5 million and its available credit was approximately $15.6 million. As adequate protection for any diminution in the value of the FRN Collateral from and after the Petition Date, (a) the FRN Holders will receive second priority liens on all existing and future tangible and intangible assets of the Debtors subject only to the carve out and the security interests and liens securing the Interim Facility and the DIP Facility and (b) reimbursement of the reasonable fees and expenses of the consenting noteholders and the Indenture Trustee under the senior secured floating rate notes due 2012. To the extent the replacement liens are insufficient to provide adequate protection, the FRN Holders will have adequate protection claims, which claims will be junior to the DIP Facility claims and will be payable from and have recourse to all assets and property of the DIP obligors. As adequate protection for the adequate protection obligations, the Prepetition Secured Lender is granted adequate protection liens and an adequate protection priority claims. As additional adequate protection, the Prepetition Secured Lender will be entitled to (x) the current cash payment of postpetition interest, letter of credit fees, and all other fees as and when due and payable under the Prepetition Credit Documents, and (y) the current payment of all postpetition fees and expenses, including the reasonable postpetition fees and expenses of legal counsel and other professionals retained by the Prepetition Secured Lender, as and when due and payable under the Prepetition Credit Documents. All cash payments to the Prepetition Secured Lender will be made on a provisional basis and will be subject to the final allowance of the Prepetition Obligations. The Prepetition Secured Lender is granted (a) valid, enforceable, unavoidable and fully perfected replacement security interests in and liens upon (i) all of the Prepetition Collateral, and (ii) all assets of the Debtors of the same type as the Prepetition Collateral that are not presently encumbered by any liens, security interests, or mortgages. The Adequate Protection Liens will be junior in priority to any valid, properly perfected, enforceable and non-avoidable liens on assets of the Debtors other than the Prepetition Secured Lender Liens, but only to the extent such liens are senior in priority to the Prepetition Secured Lender Liens; provided that the Adequate Protection Obligations will not be secured by the FRN Collateral or any assets secured by the FRN Adequate Protection Liens. The Prepetition Secured Lender is also granted a superpriority administrative expense claim. As adequate protection for the FRN Adequate Protection Obligations, the consenting noteholders are granted the FRN Adequate Protection Liens, the FRN Adequate Protection Priority Claim, and the reimbursement of fees and expenses. The Debtors' authority to use Prepetition Cash Collateral will terminate on: (a) 5:00 p.m. (Eastern Time) on one day following the Final Hearing, which Final Hearing will occur within 35 days following the entry of the Cash Collateral Order; and (b) the occurrence and continuation of an Event of Default under the Cash Collateral Order and a determination by the Prepetition Secured Lender, after one business day's prior by written notice delivered by e-mail to counsel for the Debtors by the Prepetition Secured Lender, to terminate (i) the Debtors' use of Prepetition Cash Collateral pursuant to the terms of the Cash Collateral Order and (ii) the obligation of the Prepetition Secured Lender to make disbursements thereof to the Debtors from the Cash Collateral Account in accordance with the terms of the Cash Collateral Order. About Constar International Philadelphia, Pennsylvania-based Constar International Inc. -- http://www.constar.net/-- produces and supplies polyethylene terephthalate plastic containers for food and beverages. Constar filed for Chapter 11 protection in December 2008 (Bankr. D. Del. Lead Case No. 08-13432), with a pre-negotiated Chapter 11 plan. The pre-negotiated plan, which reduced Constar's debt load by roughly $175 million, became effective on May 29, 2009. Attorneys at Bayard, P.A. and Wilmer Cutler Pickering Hale and Dorr LLP represented the Debtor in the case. Due to operating losses caused by a significant decline in demand for its products from Pepsi-Cola Advertising and Marketing Inc. and other customers, Constar International, together with affiliates, returned to Chapter 11 protection on January 11, 2011 (Bankr. D. Del. Case No. 11-10109), with a Chapter 11 plan negotiated with holders of 75% of the holders of $220 million in senior secured floating-rate notes. Andrew Goldman, Esq., and Dennis Jenkins, Esq., at Wilmer Cutler Pickering Hale And Dorr LLP, serve as the Debtors' general bankruptcy counsel. Jamie Lynne Edmonson, Esq., and Neil B. Glassman, Esq., at Bayard, P.A., serve as co-counsel to the Debtors. Pricewaterhouse Coopers serves as the Debtors' independent auditors and accountants. Kurtzman Carson Consultants LLC serves as the Debtors' claims agent. The Debtors disclosed $418 million in total assets and $414 million in total debts as of Sept. 30, 2010. CONSTAR INT'L: Presents $60MM Exit Financing Deal with Wells Fargo ------------------------------------------------------------------ Constar International Inc., et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to enter into an exit financing commitment letter with Wells Fargo Capital Finance, LLC. A copy of the Financing Commitment Letter is available for free at http://bankrupt.com/misc/CONSTAR_financingcommitmentletter.pdf The Debtor's entry into an agreement for exit financing is a condition precedent to consummation of the Debtor's proposed Plan. The Debtors say that the Commitment Letter assures the Debtors and the consenting noteholders that Debtors will be able to satisfy this condition. In the Commitment Letter, Wells Fargo provides its firm commitment to provide the Debtors, upon confirmation of a plan of reorganization acceptable to Wells Fargo, with a secured revolving loan and letter of credit facility in the amount of $60 million. The Credit Facility has a term of four years from the Closing Date. The Credit Facility may, to the extent that Lender and Debtors may agree, be structured with a separate revolving loan facility to be provided in Euros and Sterling to the UK Borrower of up to the equivalent of $10 million in each case as the Lender and the Debtors may agree and subject to the additional or other terms and conditions as Agent and the Debtors may agree. The Debtors will have the option to increase the Maximum Credit by up to an aggregate of $ 20 million, subject to the terms set forth in the Commitment Letter. The proceeds of the Credit Facility will be used to repay the outstanding allowed administrative expenses and allowed claims all in accordance with the Plan, including all obligations under the DIP credit facility and other debt to be specified, or costs, expenses and fees in connection with the Credit Facility in accordance with the Plan and for working capital of the Debtors and other proper corporate purposes. The Debtors may elect that Revolving Loans bear interest at a rate per annum equal to (a) the Base Rate plus the Applicable Margin or (b) the Eurodollar Rate plus the Applicable Margin. Swingline Loans will bear interest at a rate per annum equal to the Base Rate plus the Applicable Margin. After Event of Default, interest rate for letters of credit may be increased by 2% per annum above the highest pre-default rates. The increased rate will also be applicable to Revolving Loans and LC's outstanding in excess of the Borrowing Base. The events of default will include any failure by The Debtors or guarantors to observe or perform any of the material terms or conditions of any material order, stipulation, or other arrangement entered by or with the Bankruptcy Court in the Chapter 11 cases or otherwise under or in connection with the Plan; any material provision of the confirmation order will be vacated, reversed or stayed or modified or amended, without the consent of the Lender. Pursuant to the Commitment Letter, the Debtors agree to pay "all reasonable and documented out-of-pocket fees, costs, and Expenses . . . incurred by or on behalf of Wells Fargo . . . in connection with (i) legal and business due diligence, (ii) the preparation, negotiation, execution, and delivery of this Commitment Letter and any and all documentation for the Credit Facility, and (iii) the enforcement of any of Wells Fargo's rights and remedies under this Commitment Letter." To fund the expense reimbursement obligation, the Debtors agreed in the Commitment Letter to pay Wells Fargo a deposit of $150,000 (which they did prepetition). The Debtors further agree that -- upon entry of the order approving the Debtors' entry into the Commitment Letter -- they will pay Wells the first tranche of the applicable underwriting fee for the Credit Facility that is set forth in the Fee Letter, to wit, an amount that is .50% of the aggregate amount of the Credit Facility ($300,000). The Debtors will pay the Lender: (A) Unused Line Fee: Calculated at 0.50% per annum if average outstanding Revolving Loans and LCs in any month are less than 50% of Maximum Credit, and 0.375% per annum if average outstanding Revolving Loans and LCs are equal to or greater than 50% of Maximum Credit, payable monthly in arrears. Swingline Loans not considered in the calculation of the unused line fee. (B) Letter of Credit Fees: The Debtors will pay to (a) the Lender, for the account of Lenders on the daily outstanding balance of LCs, a letter of credit fee calculated at a rate per annum based on the then Applicable Margin for Revolving Loans using the Eurodollar Rate and (b) to Issuing Bank, the fees as are agreed, in each case under clauses (a) and (b), payable monthly in arrears. In addition, The Debtors will pay customary issuance, arranging and other fees of the Issuing Bank. (C) Audit, Appraisal and Examination Fees: The Debtors will pay (a) a fee of $1,000 per day, per auditor, plus reasonable out-of-pocket expenses for each field examination of the Loan Parties performed by personnel employed by the Lender, (b) if implemented, a fee of $1,000 per day, per applicable individual, plus reasonable out-of-pocket expenses for the establishment of electronic collateral reporting, and (c) the actual charges paid or incurred by the Lender if it elects to employ the services of one or more third persons to perform field examinations or quality of earnings analyses of Loan Parties, to establish electronic collateral reporting systems, to appraise the Collateral, or any portion thereof, or to assess the Loan Parties' business valuation. About Constar International Philadelphia, Pennsylvania-based Constar International Inc. -- http://www.constar.net/-- produces and supplies polyethylene terephthalate plastic containers for food and beverages. Constar filed for Chapter 11 protection in December 2008 (Bankr. D. Del. Lead Case No. 08-13432), with a pre-negotiated Chapter 11 plan. The pre-negotiated plan, which reduced Constar's debt load by roughly $175 million, became effective on May 29, 2009. Attorneys at Bayard, P.A. and Wilmer Cutler Pickering Hale and Dorr LLP represented the Debtor in the case. Due to operating losses caused by a significant decline in demand for its products from Pepsi-Cola Advertising and Marketing Inc. and other customers, Constar International, together with affiliates, returned to Chapter 11 protection on January 11, 2011 (Bankr. D. Del. Case No. 11-10109), with a Chapter 11 plan negotiated with holders of 75% of the holders of $220 million in senior secured floating-rate notes. Andrew Goldman, Esq., and Dennis Jenkins, Esq., at Wilmer Cutler Pickering Hale And Dorr LLP, serve as the Debtors' general bankruptcy counsel. Jamie Lynne Edmonson, Esq., and Neil B. Glassman, Esq., at Bayard, P.A., serve as co-counsel to the Debtors. Pricewaterhouse Coopers serves as the Debtors' independent auditors and accountants. Kurtzman Carson Consultants LLC serves as the Debtors' claims agent. The Debtors disclosed $418 million in total assets and $414 million in total debts as of Sept. 30, 2010. CORRYL NADEEN PARR: Court Wants Plan Docs Revised by Jan. 18 ------------------------------------------------------------ Bankruptcy Judge Thomas J. Tucker directs Corryl Nadeen Parr to amend the disclosure statement explaining the bankruptcy plan she filed on December 21, 2010. Judge Tucker's January 8, 2011 order enumerates problems in the Plan document that the Debtor must correct. A copy of the Court's order is available at http://is.gd/oGNHq0from Leagle.com. The Court directs the Debtor to file file an amended combined plan and disclosure statement, correcting those problems no later than January 18, 2011. The Debtor also must provide to Judge's chambers a redlined version of the amended combined plan and disclosure statement. Based in Birmingham, Michigan, Corryl Nadeen Parr, dba Production Design Group Ltd., and Bluephire LLC, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 10-53782) on April 26, 2010. Keith A. Schofner, Esq. -- kaschofner@lambertleser.com -- at Lambert, Leser, Isackson, Cook & Giunta, P.C., in Bay City, Michigan, serves as the Debtor's counsel. In the petition, the Debtor estimated under $50,000 in assets and $1 million to $10 million in debts. CPJFK LLC: Chapter 11 Trustee Files Emergency Motion to Use Cash ---------------------------------------------------------------- Alan Nisselson, the trustee for the Chapter 11 estate of CPJFK, LLC, asks the U.S. Bankruptcy Court for the Eastern District of New York for permission, on a second interim basis, to use cash collateral in which Neshgold, LP, asserts an interest, until January 31, 2011, pending a final hearing on his cash collateral motion. Income from Hotel operations, cash and other amounts on deposit in the Debtor's bank accounts constitute the Lender's cash collateral within the meaning of Section 363(a) of the Bankruptcy Code. The Debtor has immediate need for cash collateral to meet the Debtor's operating needs until January 31, 2011, including cash needed to fund payments to necessary vendors and suppliers, to make payroll and pay its tax obligations. Neshgold has consented to the Chapter 11 trustee's use of cash collateral during the interim period (until January 31, 2011) to pay those expenses pursuant to a Budget. The Chapter 11 trustee discloses that the Hotel will need the aggregate sum of $1,223,469 to maintain its operations through March 31, 2011. Neshgold asserts that as of the Petition Date, the aggregate outstanding indebtedness of the Debtor including interest, fees, costs and expenses totaled the sum of $15,346,781. The loans are secured by security interests in virtually all of the Debtor's assets including its ground lease, cash, accounts receivable, inventory, equipment, and general intangibles and other collateral as set forth in the Loan Documents. As adequate protection against any diminution in the value of the Neshgold's interests in the Prepetition Collateral, the Chapter 11 trustee has agreed to provide Neshgold superpriority administrative claims against the estate and replacement security interests and liens (the "Adequate Protection Liens") in and upon all prepetition and postpetition assets and properties of the Debtor. About CPJFK, LLC Atlanta, Georgia-based CPJFK, LLC, owns and operates a 183 room hotel under the name of the JFK Plaza Hotel located at 151-20 Baisley Blvd., in Jamaica, New York. The Hotel operations constitute the Debtor's sole source of income. The Debtor filed for Chapter 11 bankruptcy protection on October 4, 2010 (Bankr. N.D. Ga. Case No. 10-89928). On October 19, 2010, the U.S. Trustee for Region 21 filed a motion to transfer the Debtor's case to the U.S. Bankruptcy Court for the Eastern District of New York. On November 9, 2010, the Debtor's case was transferred to this Court and Debtor's case was assigned Case No. 10-50566. On November 12, 2010, Neshgold, LP, filed a motion pursuant to Bankruptcy Code Section 1104(a) to appoint a Chapter 11 trustee to operate the Debtor's business and administer the Debtor's estate. On November 19, 2010, the Court entered an Order directing the appointment of a Chapter 11 trustee. On November 23, 2010, the U.S. Trustee for Region 2 filed a Notice appointing Alan Nisselson as chapter 11 Trustee. On November 24, 2010, the Court approved the appointment of Alan Nisselson as trustee for the Debtor's Chapter 11 estate. No official committee of unsecured creditors has been appointed in this case. Alan Nisselson selected Choice Consultants LLC as his managing agent, nunc pro tunc to November 29, 2010. Windels Marx Lane & Mittendorf, LLP, is the Chapter 11 trustee's proposed counsel. CROWN MEDIA: Michelle Vicary Does Not Own Any Securities -------------------------------------------------------- In a Form 3 filing with the Securities and Exchange Commission on January 10, 2011, Michelle Vicary, EVP, programming at Crown Media Holdings Inc., disclosed that she does not own any securities of the Company. About Crown Media Studio City, Calif.-based Crown Media Holdings, Inc. (NASDAQ: CRWN) -- http://www.hallmarkchannel.com/-- owns and operates cable television channels dedicated to high quality, broad appeal, entertainment programming. The Company currently operates and distributes Hallmark Channel in both high definition (HD) and standard definition (SD) to 90 million subscribers in the U.S. Crown Media also operates a second 24-hour linear channel, Hallmark Movie Channel, available in both HD and SD, which focuses on family-friendly movies with a mix of classic theatrical films, presentations from the acclaimed Hallmark Hall of Fame library, original Hallmark Channel movies and special events. The Company's balance sheet as of September 30, 2010, showed $697.3 million in total assets, $676.6 million in total liabilities, $191.9 million in redeemable preferred stock, and a stockholders' deficit of $171.1 million. KPMG LLP, in Denver, expressed substantial doubt about Crown Media Holdings, Inc.'s ability to continue as a going concern, following its 2009 results. The independent auditors noted of the Company's significant short-term debt obligations. CUSTOM CABLE: Selects Tom Ward as New President ----------------------------------------------- Custom Cable Industries has selected Thomas P. Ward as its new president. The Company said it was recently reorganized following its voluntary petition under Chapter 11 of the U.S. Bankruptcy Code to reorganize and implement a balance sheet restructuring. "The resultant asset purchase has set the stage for Custom Cable's future growth and Tom is the right person to lead that," says Gregg Stewart, who served as general manager and chief restructuring officer in the predecessor company. "I am pleased to hand the reins to Tom and am confident that his track record of global strategic growth in the technology and telecommunications industries is the perfect match for Custom Cable's market potential." With relevant experience in domestic and international divisions of Fortune 100/1000 companies and proven success in sales, marketing, business operations, finance, manufacturing and supply chain, Ward has driven growth and delivered stakeholder value at global organizations including AT&T, Lucent and CommScope. Ward graduated from Central Michigan University with a bachelor's degree in Industrial Technology and Journalism and earned an MBA specializing in Finance and Enterprise Globalization from Florida Atlantic University. As a volunteer, he has co-chaired the finance committee of the Miami-Dade Broadband Coalition, a not- for-profit organization that provides broadband access and digital literacy to underserved communities in South Florida. "I am extremely pleased to be joining Custom Cable at this point in the company's growth," says Ward. "We are grateful to the customers, employees and suppliers who have supported the company during the past year and look forward to exceeding expectations as we articulate and execute on our vision." About Custom Cable Custom Cable filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 10-18478) on July 30, 2010. Michael P. Horan, Esq., and Stephanie C. Lieb, Esq., at Trenam Kemker Scharf Barkin Frye, serve as the Debtor's bankruptcy counsel. The Debtor estimated $1 million to $10 million in assets and $10 million to $50 million in debts in the Chapter 11 petition. DB CAPITAL: Files Schedules of Assets and Liabilities ----------------------------------------------------- DB Capital Holdings, LLC, filed with the U.S. Bankruptcy for the District of Colorado its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property Unknown C. Property Claimed as Exempt D. Creditors Holding Secured Claims $53,900,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $3,556,046 ----------- ----------- TOTAL Unknown $57,456,046 A copy of the Schedules of Assets & Liabilities is available for free at: http://bankrupt.com/misc/DBCapitalSAL.pdf DB Capital Holdings, LLC, is a manager-operated Colorado limited liability company created to develop and sell a luxury condominium project in Aspen, Colorado, known as Dancing Bear Residences - Aspen. The Debtor has one Class A member, Aspen HH Ventures, LLC, and one Class B member, Dancing Bear Development, LP. The general partner of DB Development is Dancing Bear Management, LLC, which has no membership or other interest in the Debtor, and is solely owned by Tom DiVenere. The Debtor is managed, pursuant to its Operating Agreement, by DB Management. Fred Funk, William Dennis, G.D.B.S. at Snowmass, Inc., Realty Financial Resources, Inc., and O'Bryan Partnership, Inc., filed an involuntary Chapter 11 bankruptcy petition (Bankr. D. Colo. Case No. 10-25805) against DB Capital Holdings. The petition was made on June 24, 2010. Judge Elizabeth E. Brown presides over the case. Jeffrey S. Brinen, Esq., represents the filers. According to the TCR on December 2, 2010, The Aspen Times said the Bankruptcy Judge ruled that the involuntary Chapter 11 met the criteria to reorganize the Company's debts. The Aspen Times noted that the ruling came after Aspen HH sought dismissal of the involuntary bankruptcy, arguing that the involuntary case was actually engineered by Mr. DiVenere. DBSI SHERIDAN: Files for Chapter 11 in Fort Lauderdale ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that DBSI Sheridan LLC, the owner of the Sheridan Office Plaza I & II in Hollywood, Florida, filed for Chapter 11 protection on Jan. 7 in Fort Lauderdale, Florida (Bankr. S.D. Fla. Case No. 11-10384). DBSI was facing foreclosure by Bank of America NA. The bank, owed $9.7 million on its mortgage, has an appraisal saying the property is worth $5.7 million. The property consists of two, three-story office buildings on seven acres. The buildings have 110,000 square feet. The mortgage has been in payment default since February 2009. DBSI SHERIDAN: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: DBSI Sheridan, LLC 1501 5 Ave #100 San Diego, CA 92101 Bankruptcy Case No.: 11-10384 Chapter 11 Petition Date: January 7, 2011 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Debtor's Counsel: Scott A. Underwood, Esq. Thomas M. Messana, Esq. MESSANA STERN, P.A 401 E Las Olas Blvd # 1400 Fort Lauderdale, FL 33301 Fort Lauderdale, FL 33301 Tel: (954) 712-7400 Fax: (954) 712-7401 E-mail: sunderwood@mws-law.com tmessana@mws-law.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A copy of the Company's list of 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/flsb11-10384.pdf The petition was signed by Todd Mikles, authorized officer. DENNY'S CORP: Names Former Taco Bueno Head J. Miller as New CEO --------------------------------------------------------------- Denny's Corporation announced the appointment of John C. Miller to the position of President and Chief Executive Officer, effective February 1, 2011. Mr. Miller succeeds Debra Smithart-Oglesby who has filled the position on an interim basis since June 2010. Ms. Smithart-Oglesby will continue to serve as board chair for Denny's. "John is a proven leader in the restaurant industry who has the talent and experience to build upon our current momentum and accelerate the resurgence of the Denny's business and brand," commented Louis P. Neeb, head of the board's CEO search committee. "We conducted an extensive international search including dozens of highly-qualified candidates and believe that John has the right combination of skills and experience to further our growth and create additional value. He brings a passion for understanding and building brands, extensive operating skills at all levels of the business, a talent for leading management teams and working with franchisees, along with a proven ability to deliver growth and financial performance." Mr. Neeb also commented, "Debra has done an outstanding job as interim CEO over the past six months in leading a turnaround at Denny's and creating considerable forward momentum. The Company is indebted to her and looks forward to her continued guidance and leadership as board chair." Mr. Miller joins Denny's management team with more than 30 years of restaurant industry experience. Since 2005, he has served as Chief Executive Officer and President at Taco Bueno Restaurants, Inc., an operator and franchisor of quick service Mexican eateries with 190 units. Prior to Taco Bueno, Mr. Miller spent 17 years at Brinker International where he held numerous management positions. From 1997 to 2004, he served as President at Romano's Macaroni Grill where he helped reverse three years of declining sales and growth, generating 15 consecutive quarters of sales and profit increases, and more than doubling the company's size. Mr. Miller also served as President of Brinker's Mexican Concepts, responsible for overseeing On the Border and Cozymel's, two of the Company's high growth concepts. Early in his career, Mr. Miller held various operations and restaurant management positions at Unigate Restaurant/Casa Bonita in Dallas, Texas. Debra Smithart-Oglesby, Denny's board chair, added: "I know John well from my time at Brinker and he will be an outstanding leader for Denny's. Together with Mark Wolfinger, our CAO and CFO, and Frances Allen and Robert Rodriguez, who recently joined as CMO and COO, respectively, we have built a first-class leadership team at Denny's. I am very proud of the progress we have made during the second half of last year and I look forward to working closely with John, the rest of our executive team and my fellow board members to build upon this momentum and enhance value for our investors, franchisees, partners and employees going forward." The Compensation and Incentives Committee of Denny's Board of Directors approved the following incentive awards to Mr. Miller as an inducement to his employment: (i) 200,000 performance-based restricted stock units, and (ii) a non-qualified stock option to purchase up to 200,000 shares of common stock. The performance-based restricted stock units represent the right to earn up to 200,000 shares of Denny's common stock, based on the closing price of the common stock exceeding specific price hurdles for 20 consecutive trading days, and subject to Mr. Miller's continued employment with Denny's. The stock options will have an exercise price per share equal to the fair market value of the underlying shares as of the grant date. The options will vest in equal annual installments on each of the first three anniversaries of the grant date, subject to Mr. Miller's continued employment with Denny's. The stock options have a maximum term of ten years. The awards were negotiated and approved as an inducement to Mr. Miller's entering into employment with Denny's in accordance with NASDAQ Listing Rule 5635(c)(4). About Denny's Corporation Based in Spartanburg, South Carolina, Denny's Corporation (NASDAQ: DENN) -- http://www.dennys.com/-- Denny's is one of America's largest full-service family restaurant chains, consisting of 1,348 franchised and licensed units and 232 company-owned units, with operations in the United States, Canada, Costa Rica, Guam, Mexico, New Zealand and Puerto Rico. The Company's balance sheet at Sept. 29, 2010, showed $312.67 million in total assets, $415.10 million in total liabilities, and a stockholders' deficit of $102.42 million. Denny's carries "B2" corporate family and probability of default ratings from Moody's Investors Service and a 'B+' corporate credit rating from Standard & Poor's. DILLARD'S INC: S&P Raises Corporate Rating to 'BB-' --------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Little Rock, Ark.-based Dillard's Inc. to 'BB-' from 'B+'. At the same time, S&P raised the rating on the Company's unsecured debt to 'BB-' from 'B+' and the rating on the subordinated debentures to 'B-' from 'CCC+'. The '4' recovery rating on the Company's unsecured debt remains unchanged. "The upgrade reflects the significant margin gains by the Company over the past year, which has strengthened its credit protection profile considerably," said Standard & Poor's credit analyst David Kuntz. Additionally, the upgrade incorporates S&P's belief that the Company would perform well during the seasonally important fourth quarter and that positive trends are likely to continue over the near term. The outlook is stable. The ratings on Dillard's reflect Standard & Poor's expectation that performance is likely to improve modestly over the near term despite the uneven economic recovery. The Company's credit profile has improved significantly over the past year, and S&P expect it to maintain its above-average credit protection metrics over the near term. However, in S&P's view, the anticipated gains in credit protection measures during 2011 will be subdued. "Dillard's weak business profile reflects the challenges of operating in a highly competitive retailing sector, its relatively small position in the moderate department store industry, and productivity measures that are below average for its peer group," said Mr. Kuntz. DOMICILE LAND: Case Summary & 4 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Domicile Land and Development, LLC fdba Aquarian Development, LLC 820 N. County Highway 393 Santa Rosa Beach, FL 32459 Bankruptcy Case No.: 11-30037 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court Northern District of Florida (Pensacola) Debtor's Counsel: Brian G. Rich, Esq. BERGER SINGERMAN PA 125 S. Gadsden Street, Suite 300 Tallahassee, FL 32301 Tel: (850) 561-3010 Fax: (850) 561-3013 E-mail: brich@bergersingerman.com Scheduled Assets: $1,075,000 Scheduled Debts: $618,300 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flnb11-30037.pdf The petition was signed by James C. Springer, managing member. ELITE PHARMACEUTICALS: Inks Supply Pact with Hi-Tech ---------------------------------------------------- Elite Pharmaceuticals, Inc. and Hi-Tech Pharmacal Co., Inc. announced that they have entered into an agreement for Elite to develop for Hi-Tech an intermediate for a generic version of a prescription product for which the branded product had sales in 2010 of over $100 million. Under the terms of the agreement, Elite will undertake a developmental program for an intermediate product that Hi-Tech shall then incorporate into a final product. Hi-Tech, or its designees, shall be responsible for the filing of the Abbreviated New Drug Application for the finished product and the ANDA will be filed under the Hi-Tech name. Upon approval of the ANDA, Elite will manufacture the intermediate product. Hi-Tech will manufacture the final product and will be responsible for the marketing and sales of the final product. Hi-Tech will pay Elite milestone payments for the development work. Upon commercialization, Elite will receive payment for the manufacturing of the intermediate product and a percentage of the profits generated from the sale of the product. About Hi-Tech Pharmacal Co., Inc. Hi-Tech is a specialty pharmaceutical company developing, manufacturing and marketing generic and branded prescription and OTC products. The Company specializes in difficult to manufacture liquid and semi-solid dosage forms and produces a range of sterile ophthalmic, otic and inhalation products. The Company's Health Care Products Division is a leading developer and marketer of branded prescription and OTC products for the diabetes marketplace. Hi-Tech's ECR Pharmaceuticals subsidiary markets branded prescription products. About Elite Pharmaceuticals Northvale, N.J.-based Elite Pharmaceuticals, Inc. (OTC BB: ELTP) -- http://www.elitepharma.com/-- is a specialty pharmaceutical company that develops and manufactures oral, controlled-release products using proprietary technology. Elite developed and manufactures for its partner, ECR Pharmaceuticals, Lodrane 24(R) and Lodrane 24D(R), for allergy treatment and expects to launch soon three approved generic products. Elite also has a pipeline of additional generic drug candidates under active development and the Company is developing ELI-216, an abuse resistant oxycodone product, and ELI-154, a once-a-day oxycodone product. Elite conducts research, development and manufacturing in its facility in Northvale, New Jersey. The Company's balance sheet at Sept. 30, 2010, showed $10.86 million in total assets, $23.67 million in total liabilities, and a stockholders' deficit of $12.81 million. Demetrius & Company, L.L.C., in Wayne, New Jersey, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's results for fiscal year ended March 31, 2010. The independent auditors noted that the Company has experienced significant losses and negative operating cash flows resulting in a working capital deficiency and shareholders' deficit. The Company reported a net loss $8.1 million on $3.3 million of revenue for the year ended March 31, 2010, compared with a net loss of $6.6 million on $2.3 million of revenue for the year ended March 31, 2009. EMIVEST AEROSPACE: Wants May 18 Plan Filing Exclusivity Extension ----------------------------------------------------------------- Dow Jones' Small Cap reports that Emivest Aerospace Corp. is seeking an extra three months to keep control of its bankruptcy as it works to find a buyer for its business manufacturing high-speed corporate jets. The report relates that in court papers filed Tuesday, Emivest urged a bankruptcy judge to extend to May 18 the time in which it has the exclusive right to file the Chapter 11 plan describing how it will pay its creditors. The Debtor is also seeking to extend to July 17 the time it has to work to bring its creditors on board with that plan. Absent an extension, Emivest faces a Feb. 17 deadline to file its plan and an April 18 deadline to solicit its creditors' support for that plan, according to the report. Emivest said its employees, lawyers and financial advisers are currently focusing their full attention on finding a buyer for the company, as well as such other time-critical matters as stabilizing the business, the report adds. 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. EVERGREEN ENERGY: Ilyas Khan Owns 1.2MM Derivative Securities ------------------------------------------------------------- In a Form 3 filing with the Securities and Exchange Commission on January 10, 2011, Ilyas Khan, a director at Evergreen Energy Inc., said that he does not own any non-derivative securities of Evergreen. Mr. Khan disclosed that he has warrants to buy an aggregate of 1,238,150 derivative securities of Evergreen Energy Inc. The derivative securities were exercisable on December 31, 2010 and will expire on December 31, 2015. About Evergreen Energy Evergreen Energy Inc. has developed two proven, proprietary, patented, and transformative green technologies: the GreenCert(TM) suite of software and services and K-Fuel(R). GreenCert, which is owned exclusively by Evergreen, is a science-based, scalable family of environmental intelligence solutions that quantify process efficiency and greenhouse gas emissions from energy, industrial and agricultural sources and may be used to create verifiable emission reduction credits. K-Fuel technology significantly improves the performance of low-rank coals, yielding higher efficiency and lowering emissions. Deloitte & Touche LLP, in Denver, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted of the Company's recurring losses from operations and stockholders' deficit. The Company's balance sheet as of September 30, 2010, showed $33.93 million in total assets, $45.04 million in total liabilities, $3,000 in temporary equity, and a stockholders' deficit of $11.11 million. FAIRPOINT COMMS: Verizon Fights to Bring Claims Over $2-Bil. Deal ----------------------------------------------------------------- Bankruptcy Law360 reports that Verizon Communications Inc. is continuing to attack elements in FairPoint Communications Inc.'s Chapter 11 plan that would prevent the telecommunications firm from asserting claims against Capgemini US LLC related to a ruinous $2.3 billion landline deal. About FairPoint Communications FairPoint Communications, Inc. (NYSE: FRP) -- http://www.fairpoint.com/-- owns and operates local exchange companies in 18 states offering advanced communications with a personal touch, including local and long distance voice, data, Internet, television and broadband services. FairPoint is traded on the New York Stock Exchange under the symbols FRP and FRP.BC. FairPoint and its affiliates filed for Chapter 11 protection on Oct. 26, 2009 (Bankr. D. Del. Case No. 09-16335). Rothschild Inc. is acting as financial advisor for the Company; AlixPartners, LLP as the restructuring advisor; and Paul, Hastings, Janofsky & Walker LLP is the Company's counsel. BMC Group is claims and notice agent. As of June 30, 2009, FairPoint reported $3.24 billion in total assets, $321.41 million in total current liabilities, $2.91 billion in total long-term liabilities, and $1.23 million in stockholders' equity. Andrews Kurth is counsel to the Official Committee of Unsecured Creditors. Altman Vilandrie is the operational consultant to the Creditors' Committee. Verrill Dana is the Creditors' Committee's special regulatory counsel. Jeffries serves as the Creditors' Committee's financial advisor. FORTY ACRE: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: Forty Acre Corporation 5320 Shrimpers Row Houma, LA 70363 Bankruptcy Case No.: 11-10074 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court Eastern District of Louisiana (New Orleans) Judge: Elizabeth W. Magner Debtor's Counsel: Randall M. Alfred, Esq. 106 Ramey Road Houma, LA 70360 Tel: (985) 876-4292 Fax: (985) 868-3674 E-mail: rmaaplc@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Mike LeBlanc, president GRAY STAR: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: Gray Star Investments, Inc. dba Holiday Inn Express 8797 20th Street Vero Beach, FL 32966 Bankruptcy Case No.: 11-00347 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Buddy D. Ford, Esq. 115 N. MacDill Avenue Tampa, FL 33609-1521 Tel: (813) 877-4669 Fax: (813) 877-5543 E-mail: Buddy@tampaesq.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Ramesh Patel, president. GRAY TELEVISION: Capital World Equity Stake Down to 0% ------------------------------------------------------ In an amended Schedule 13G filing with the Securities and Exchange Commission on January 10, 2010, Capital World Investors disclosed that it does not own any shares of Gray Television, Inc. common stock. In July 2010, Capital World Investors, a division of Capital Research and Management Company, disclosed that it is deemed to be the beneficial owner of 5,261,981 shares or 10.2% of the 51,381,084 shares of Gray Television, Inc. Common Stock believed to be outstanding as a result of CRMC acting as investment adviser to various investment companies registered under Section 8 of the Investment Company Act of 1940. Class A Common Stock and Common Stock vote together as a singled class of shares. Class A Common Stock has 10 votes per shares. About Gray Television Formerly known as Gray Communications System, Atlanta, Georgia- based Gray Television, Inc., is a television broadcast company. Gray currently operates 36 television stations serving 30 markets. Each of the stations are affiliated with either CBS (17 stations), NBC (10 stations), ABC (8 stations) or FOX (1 station). In addition, Gray currently operates 38 digital second channels including 1 ABC, 4 Fox, 7 CW, 16 MyNetworkTV and 1 Universal Sports Network affiliates plus 8 local news/weather channels and 1 "independent" channel in certain of its existing markets. Gray Television carries 'CCC' issuer credit ratings from Standard & Poor's and 'Caa1' corporate family rating from Moody's. The Company's balance sheet at Sept. 30, 2010, showed $1.25 billion in total assets, $1.10 billion in total liabilities, and stockholders' equity of $111.81 million. GREAT ATLANTIC & PACIFIC: Wins Final Nod of $800MM Financing ------------------------------------------------------------ The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors obtained final approval from the U.S. Bankruptcy Court for the Southern District of New York to enter into a debtor-in- possession credit agreement with JPMorgan Chase Bank, N.A. The final order authorized the Debtors to borrow money and obtain letters of credit pursuant to the DIP Credit Agreement up to an aggregate principal or face amount of $800 million. In a 58-page order dated January 11, 2011, Judge Robert Drain held that the Debtors need to obtain the DIP financing to continue their business operations, make capital expenditures and satisfy other working capital and operational needs. "The Debtors are unable to obtain financing on more favorable terms from sources other than the DIP lenders," Judge Drain said. Judge Drain approved the loan after changes that set aside as much as $175,000 per month in legal fees for Wilmington Trust, as trustee to certain notes, Bloomberg News reports. A group of secured noteholders owning the notes said the new loan would put them further in line to be repaid, in violation of an intercreditor agreement. "I think that's a fair resolution" Bloomberg quoted Judge Drain as saying. "It doesn't resolve issues about the intercreditor agreement. Any issues under that are for another day," he said. The Final DIP Order holds that if any of the $175,000 is not used in a particular month, the unused amount may not be used in any subsequent month, the sole exception being that a total of $612,500 can be applied to any reasonable fees and expenses accrued from December 12, 2010, through and including March 31, 2011. Counsel to the Ad Hoc Consortium of Certain Holders of A&P 113/8% Senior Secured Notes will be entitled to Fee and Expense Adequate Protection only if it is retained as counsel, including nunc pro tunc to December 12, 2010, to Wilmington Trust. A&P resolved the objection filed by the Official Committee of Unsecured Creditors Sunday night, A&P's lawyer Paul Basta, Esq., at Kirkland & Ellis LLP, in New York, told Judge Drain at the hearing, Bloomberg relates. All other objections to the final approval of the DIP financing were overruled. "Nobody contests that this is the best and only DIP. Nobody has a better solution than this DIP," The Star-Ledger-NJ.com quoted Mr. Basta as saying. Prior to the Final DIP hearing, counsel to the Secured Noteholder Consortium has made a request to Yucaipa Cos.' counsel -- Latham & Watkins LLP -- to disclose the amount of Yucaipa's holdings of other Debtor debt issuances, including any Secured Notes, but as of January 4, 2010, Yucaipa has not provided the requested information. The Secured Noteholder Consortium told the Court that Yucaipa should disclose the amount of its debt holdings, including holdings of Secured Notes. "[W]e think they're all over the capital structure; we've been asking to know what Yucaipa is holding," Edward Weisfelner, Esq., at Brown Rudnick LLP, in New York, told Drain at the hearing. The Debtors have indicated that Ron Burkle's Yucaipa hold a majority of their preferred stock, and control 2 board seats as a result, and have recently acquired certain debt of the Debtors, including Secured Notes, according to papers filed in Court. According to Bloomberg News, Yucaipa is widely rumored in the market to also own large part of second lien bonds, and have a large stake in the DIP loan. Other Provisions The Final DIP Order also authorized the Debtors to incur overdrafts and related liabilities arising from treasury, depository and cash management services. The final order, however, does not require JPMorgan or any other party to incur overdrafts or provide those services and functions to the Debtors. In return for the financing, the Debtors' obligations under the DIP Credit Agreement will constitute allowed claims against them with priority over all administrative expenses and other claims. All liens and claims granted pursuant to the final order will be subject to the so-called "carve out." Carve out refers to all fees required to be paid to the Clerk of the Bankruptcy Court and to the Office of the U.S. Trustee, and fees and expenses incurred by a trustee under Section 726(b) of the Bankruptcy Code, in an amount not exceeding $15,000,000. As further security for the DIP obligations, JPMorgan will be granted first lien on the Debtors' cash balances and unencumbered property. JPMorgan will also be granted "first priority senior priming security interest and lien" on all property of the Debtors that is subject to the existing liens presently held by the prepetition secured lenders and Wilmington Trust. Those security interests and liens will be senior to the interests in such property of the prepetition secured lenders and Wilmington Trust. A full-text copy of the final DIP order is available for free at http://bankrupt.com/misc/A&P_FinalDIPorder.pdf About A&P Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific (A&P) is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. The Great Atlantic & Pacific Tea Company, Inc., and its affiliates filed petitions under Chapter 11 of the U.S. Bankruptcy Code on December 12, 2010 (Bankr. S.D.N.Y. Case No. 10-24549) in White Plains. As of September 11, 2010, the Debtors reported total assets of $2.5 billion and liabilities of $3.2 billion. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Bankruptcy Creditors' Service, Inc., publishes ATLANTIC & PACIFIC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by A&P and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). GREAT ATLANTIC & PACIFIC: Wins OK for Access to Cash Collateral --------------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors obtained final court approval to use the cash collateral of their prepetition secured lenders and prepetition secured noteholders. "The access of the Debtors to sufficient working capital and liquidity through the use of cash collateral, incurrence of new indebtedness for borrowed money and other financial accommodations is vital to the preservation and maintenance of the going concern values of the Debtors and to a successful reorganization of the Debtors," Judge Robert Drain said in an order dated January 11, 2011. The final order authorized the Debtors to use the cash collateral other than the $2.04 million deposit with Bank of America N.A. as well as the $5 million deposit of which $1.1 million is still held in escrow by the bank. The $2.04 deposit secures all obligations due to BofA, administrative agent for the prepetition secured lenders, on account of bank products and cash management services provided to the Debtors. The prepetition secured noteholders, prepetition secured lenders and their trustee, Wilmington Trust Company, were ordered to turn over to the Debtors all cash collateral received or held by them, provided that they are granted adequate protection for the cash collateral. Pursuant to the final order, the prepetition secured lenders will be entitled to "adequate protection" of their interest in the prepetition collateral including the cash collateral until the repayment of the pre-bankruptcy loans they made to the Debtors. They will be granted, among other things, "adequate protection liens" and a "superpriority claim" provided for in Section 507(b) of the Bankruptcy Code, which is junior to the claims held by JPMorgan Chase Bank N.A. and the DIP lenders. Meanwhile, the prepetition secured noteholders will be granted "junior security interests and liens" in all property of the Debtors that is subject to the security interests and liens granted to JPMorgan and the prepetition secured lenders. About A&P Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific (A&P) is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. The Great Atlantic & Pacific Tea Company, Inc., and its affiliates filed petitions under Chapter 11 of the U.S. Bankruptcy Code on December 12, 2010 (Bankr. S.D.N.Y. Case No. 10-24549) in White Plains. As of September 11, 2010, the Debtors reported total assets of $2.5 billion and liabilities of $3.2 billion. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Bankruptcy Creditors' Service, Inc., publishes ATLANTIC & PACIFIC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by A&P and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). GREAT ATLANTIC & PACIFIC: To Waive Preferences vs. Key Vendors -------------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors seek court approval to waive or release any preference claims or actions they may have against so-called "critical vendors" as part of their critical vendor program. "The Debtors believe that the authority to give preference waivers to certain critical vendors is essential to have sufficient flexibility to secure trade agreements with some of the remaining critical vendors with whom no such agreement has yet been reached," says the Debtors' lawyer, Paul Basta, Esq., at Kirkland & Ellis LLP, in New York. The Debtors' critical vendor program has been largely successful to date but the Debtors are still negotiating with some of their critical vendors. Certain vendors have already represented that they will not sign a trade agreement unless they receive a preference waiver, according to Mr. Basta. The Debtors previously obtained interim court approval to earmark as much as $62 million to pay the pre-bankruptcy claims of so- called critical vendors, and another $5 million to pay claims that are entitled to priority. The critical vendors include merchandisers which directly supply products to the Debtors' store locations via direct-store-delivery or similar supply processes; brokerage firms and other suppliers which provide the Debtors "private label" needs; advertisers and printers and other service providers. As of December 12, 2010, the Debtors owe these vendors around $62 million, including claims totaling about $55 million that may be entitled to priority. The $62 million is about 29% of the Debtors' accrued payables of approximately $212 million. About A&P Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific (A&P) is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. The Great Atlantic & Pacific Tea Company, Inc., and its affiliates filed petitions under Chapter 11 of the U.S. Bankruptcy Code on December 12, 2010 (Bankr. S.D.N.Y. Case No. 10-24549) in White Plains. As of September 11, 2010, the Debtors reported total assets of $2.5 billion and liabilities of $3.2 billion. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Bankruptcy Creditors' Service, Inc., publishes ATLANTIC & PACIFIC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by A&P and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). GURU PROPERTIES: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Guru Properties LLC 3400 Parkwood Boulevard Frisco, TX 75034 Bankruptcy Case No.: 11-10101 Chapter 11 Petition Date: January 12, 2011 Court: U.S. Bankruptcy Court Western District of Oklahoma (Oklahoma City) Judge: Sarah A. Hall Debtor's Counsel: Robert J. Haupt, Esq. PHILLIPS MURRAH P.C. Corporate Tower, 13th Floor 101 N. Robinson Oklahoma City, OK 73102 Tel: (405) 235-4100 Fax: (405) 235-4133 E-mail: rjhaupt@phillipsmurrah.com Scheduled Assets: $2,129,347 Scheduled Debts: $5,125,624 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/okwb11-10101.pdf The petition was signed by Jagmohan S. Dhillon, attorney in fact. HARRISBURG, PA: Hires Consultants to Draft Financial Recovery Plan ------------------------------------------------------------------ Dow Jones' Small Cap reports that Pennsylvania officials tapped a team of consultants to create and implement a recovery plan for the distressed capital city Harrisburg under the state's oversight program known as Act 47. Novak Consulting Group of Cincinnati will lead a team of professionals including Bob O'Donnell, of O'Donnell Associates, who in November was appointed as a fiscal consultant to Harrisburg by Pennsylvania's Department of Community and Economic Development, according to the report. The report notes that other members are from the Pennsylvania Economy League and the law firm of Stevens and Lee. "Each member brings their own area of expertise to address Harrisburg's complex and unique financial issues and, together, their knowledge of municipal financial expertise will be a great asset to the city," said Austin Burke, secretary of the state's Department of Community and Economic Development, in a statement obtained by the news agency. About Harrisburg, Pennsylvania 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, 2010, 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. In November 2010, the city council tapped Cravath, Swaine and Moore LLP as debt restructuring advisors. Cravath is working on "pro bono" basis. HEADGEAR, INC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Headgear, Inc. 3409 Chandler Creek Road Virginia Beach, VA 23453-2885 Bankruptcy Case No.: 11-70127 Chapter 11 Petition Date: January 12, 2011 Court: U.S. Bankruptcy Court Eastern District of Virginia (Norfolk) Judge: Frank J. Santoro Debtor's Counsel: Karen M. Crowley, Esq. CROWLEY, LIBERATORE, & RYAN, P.C. 1435 Crossways Boulevard, Suite 300 Chesapeake, VA 23320 Tel: (757) 333-4500 Fax: (757) 333-4501 E-mail: kcrowley@clrfirm.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/vaeb11-70127.pdf The petition was signed by Guy L. Stello, chief financial officer. INN OF THE MOUNTAIN: Recurring Losses Cue Going Concern Doubt ------------------------------------------------------------- Inn of the Mountain Gods Resort and Casino filed on January 10, 2011, its annual report on Form 10-K for the fiscal year ended September 30, 2010. BDO USA, LLP, in Las Vegas, Nevada, expressed substantial doubt about Inn of the Mountain Gods Resort and Casino's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses, negative cash flows, has negative working capital, accumulated deficits, and negative equity. On September 3, 2009, the Management Board of IMG Resort and Casino resolved by unanimous consent to change the Company's fiscal year, formerly ending April 30, to a fiscal year ending September 30, effective September 30, 2009. This change in fiscal year end makes the Company's year end coincide with the Mescalero Apache Tribe's fiscal year end. The Company reported a net loss of $4.7 million on $115.2 million of net revenue for the fiscal year ended September 30, 2010. The Company reported net income of $2.3 million on $51.3 million of net revenue for the five months ended September 30, 2009. The Company reported a net loss of $856,904 on $114.3 million of net revenue for the twelve months ended April 30, 2009, compared with a net loss of $6.2 million on $122.1 million of net revenue for the twelve months ended April 30, 2008. The Company's balance sheet at September 30, 2010, showed $204.5 million in total assets, $261.8 million in total liabilities, and a stockholders' deficit of $57.3 million. A full-text copy of the Form 10-K is available for free at: http://researcharchives.com/t/s?7208 Mescalero, N.M.-based Inn of the Mountain Gods Resort and Casino is a wholly-owned enterprise of the Mescalero Apache Tribe with the exclusive power to conduct gaming activities on the Tribe's reservation. The Company operates New Mexico's only all-season gaming destination resort on the Tribe's 725 square mile reservation in south-central New Mexico. As of September 30, 2010, the Mescalero Apache Tribe had approximately 4,681 members. INNKEEPERS USA: Working With Five Mile, Lehman on Plan Funding -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Innkeepers USA Trust said in its motion for an extension of its exclusive plan proposal period that it's working with Five Mile Capital Partners LLC and a subsidiary of secured lender Lehman Brothers Holdings Inc. on an agreement to fund a reorganization plan. The proposal includes an auction to test whether anyone will top the offer from Five Mile and the Lehman subsidiary, Lehman ALI Inc. According to Mr. Rochelle, Innkeepers is asking for a four-month extension of the exclusive right to propose a Chapter 11 plan. If granted at a Jan. 26 hearing, the new deadline would be May 30. Preferred Shareholders' Proposal In the Works Mr. Rochelle relates that holders of Innkeepers' preferred stock are working on a proposal where they would retain an equity interest in five hotels that aren't subject to the $238 million in floating-rate mortgages held by Lehman on 20 properties and the 45 hotels where Midland Loan Services Inc. was acting as servicer for $825 million in mortgage debt. According to the Bloomberg report, the preferred shareholders' proposal entails using Innkeepers' available cash and proceeds from a rights offering to raise $15 million while reinstating $160 million in mortgages on the five hotels. The shareholders' proposal was laid out in a letter obtained by Bloomberg News from someone involved in the discussions who couldn't be identified because the talks are private. The preferred shareholders, Mr. Rochelle relates, would end up with 40% of the stock plus the right to participate in the rights offering for another 40%. Preferred shareholders providing a backstop for the offering would be given 20% of the stock. The preferred shareholders are urging the holders of mortgages on the other 65 properties not to propose a plan making it impossible for them to retain what they believe is an equity in the five properties. Mr. Rochelle recounts that early in the case, the bankruptcy judge refused to approve a proposal where equity in reorganized Innkeepers would have been shared by Lehman and Apollo Investment Corp., the current owner. The original plan was opposed by Midland. 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). Paul M. Basta, Esq., at Kirkland & Ellis LLP, in New York; Anup Sathy, P.C., Esq., Marc J. Carmel, Esq., at Kirkland & Ellis in Chicago; and Daniel T. Donovan, Esq., at Kirkland & Ellis in Washington, DC, 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. 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. KANSAS CITY SOUTHERN: Fitch Puts 'BB' Rating on $185MM Sr. Notes ---------------------------------------------------------------- Fitch Ratings assigned a rating of 'BB' to Kansas City Southern de Mexico, S.A. de C.V.'s recently issued US$185 million senior notes due in 2020. Proceeds from the offering were used to complete two tender offers, purchasing US$143 million of US$175 million 7.625% senior notes due 2013 and US$32 million of US$130 million 12.500% senior notes due 2016. Fitch currently rates KCSM: -- Foreign currency Issuer Default Rating (IDR) 'BB'; -- Local currency IDR 'BB'; -- US$32 million 7.625% senior notes due 2013 'BB'; -- US$165 million 7.375% senior notes due 2014 'BB'; -- US$98 million 12.500% senior notes due 2016 'BB'; -- US$300 million 8.000% senior notes due 2018 'BB'; -- US$185 million 6.625% senior notes due 2020 (the new issuance) 'BB'. The Rating Outlook is Stable. The ratings reflect KCSM's business recovery and solid operational performance during the last 12 month (LTM) period ended Sept. 30, 2010. The ratings also reflect the company's improved leverage profile following stronger cash flow generation, along with its solid business position and diversified revenue base as a leading provider of railway transportation services in Mexico. Also incorporated into the ratings is the strong business and credit relationship between KCSM and its fully controlling company, Kansas City Southern. KCSM is well positioned to benefit from the improvement in the Mexican economy and cross-border trade with the United States, as the majority of the company's revenues are derived from international freight. After contracting -2.6 and -6.5% during 2009, the U.S. and Mexican economies are expected to grow 2.7% and 2.5% during 2010, and 4.4% and 3.6% during 2011, respectively. Positive Business Momentum, Recovery Expected to Continue: KCSM's business operations recovered strongly in conjunction with its controlling shareholder, KCS, during the first nine months of 2010. In this period, KCSM's revenues were US$582.4 million, a 33% increase over similar period of 2009. The increase in the company's revenue reflects a 26% increase in total carload units and a 6% increase in revenue per carload unit, with all the businesses achieving positive revenue growth rates. At the consolidated level, KCS also achieved a similar trend. During the first nine months of 2010, KCS's revenues were US$1.3 billion, a 25% increase over similar period of 2009. The increase in KCS's revenue reflects a 16% increase in total carload units and an 8.8% increase in revenue per carload unit. The sectors driving the revenue recovery were chemical & petroleum, industrial & consumer products, and agriculture & mineral, which represented approximately 23%, 24%, and 27%, respectively, of KCSM's total revenue during the first nine months of 2010. Fitch projects that KCSM will generate approximately US$792 million and US$884 million in revenues during fiscal year 2010 and FY2011, respectively. KENTUCKY DATA: Moody's Confirms 'B1' Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service has confirmed the B1 Corporate Family Rating of Kentucky Data Link, Inc., and the B1 ratings for its senior first lien secured credit facilities. The rating action follows completion of the acquisition of Q-Comm, KDL's direct holding company, by Windstream Corporation, following which KDL's outstanding credit facilities were repaid in full and terminated. The action concludes the review of KDL's ratings which was initiated on October 18, 2010, following the announcement of KDL's proposed acquisition by Windstream Corporation. Moody's will withdraw KDL's ratings subsequent to today's rating actions. Moody's has confirmed the following rating actions: Kentucky Data Link, Inc. -- Corporate Family Rating, B1 -- Probability of Default Rating, B2 -- Senior Secured Bank Credit Facility, B1 LGD3 (32%) -- Outlook, Changed To Stable from Rating Under Review All ratings will be withdrawn. The last rating action affecting KDL occurred on August 18, 2010, when KDL's ratings were placed under review for upgrade. The principal methodology used in rating KDL was Moody's rating methodology for Global Telecommunications Industry published in December 2007 and available on www.moodys.com in the Rating Methodologies sub-directory under the Research & Ratings tab. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found in the Rating Methodologies sub-directory on Moody's website. Kentucky Data Link, Inc., a wholly owned subsidiary of Q-Comm Corporation, is headquartered in Evansville, IN, and provides wholesale long-haul transport telecommunications services in the Midwest and Southeast US. KH FUNDING: U.S. Trustee Gets More Time to Challenge Gray Hiring ---------------------------------------------------------------- Bankruptcy Judge Thomas J. Catliota signed off on KH Funding Company's stipulation with the United States Trustee for Region 4, extending until January 14, 2011, the time upon which the U.S. Trustee can file his comments or objections to the Debtor's request to employ Gray & Associates, LLC, as Asset Disposition Consultant. A copy of the Stipulation, dated January 10, 2011, is available at http://is.gd/dKV65cfrom Leagle.com. Silver Spring, Maryland-based KH Funding Company filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case No. 10-37371) on December 3, 2010. Lawrence Coppel, Esq. -- lcoppel@gfrlaw.com -- at Gordon Feinblatt Rothman Hoffberger & Hollander, LLC, in Baltimore, Maryland, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. LEVEL 3 COMMS: S&P Assigns 'CCC' to Proposed $300MM Unsec. Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'CCC' issue-level rating and '6' recovery rating to Broomfield, Colo.-based Level 3 Communications Inc.'s (Level 3) proposed $300 million of senior unsecured notes due 2019. The Company intends to use the proceeds from the new notes for the redemption of its 5.25% convertible senior notes due 2011 and for general corporate purposes. Pro forma for the transaction, this facilities-based provider of communications services and transport will have about $6.6 billion of consolidated debt. Other ratings, including the 'B-' corporate credit rating and the stable outlook, remain unchanged. Ratings List Level 3 Communications Inc. Corporate Credit Rating B-/Stable/-- New Rating Level 3 Communications Inc. Senior Unsecured $300 Mil Notes CCC Recovery Rating 6 LEWIS BLOOM: Seeks Court OK to Retain Special Counsel ----------------------------------------------------- Bankruptcy Judge Paul Mannes signed off on a stipulation between Lewis Bloom and the United States Trustee for Region 4, extending the time upon which the U.S. Trustee can file his comments or objections to the Debtor's application to employ special counsel. The objection was extended until January 12, 2011. A copy of the Stipulation dated January 10, 2011, is available at http://is.gd/kOzwL5from Leagle.com. Bethesda, Maryland-based Lewis Bloom filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 10-30604) on September 7, 2010. Alan S. Kerxton, Esq. -- akerxton@steinsperling.com -- at Stein, Sperling, Bennett, De Jong, Driscoll & Greenfeig, PC, serve as the Debtor's counsel. In his petition, the Debtor listed under $50,000 in assets and $1 million to $10 million in debts. LIONS GATE: MHR Fund Management Holds 29.4% Equity Stake -------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on January 10, 2011, MHR Fund Management LLC disclosed that it beneficially owns 40,221,406 shares of common stock of Lions Gate Entertainment Corp. representing 29.4% of the shares outstanding. As of November 1, 2010, there were 136,604,460 shares of the Company's common stock outstanding. Other affiliates of MHR Fund Management also disclosed beneficial ownership of common stock: Shares Equity Beneficially Owned Stake ------------------ ------ MHR Institutional Advisors II LLC 8,278,176 6.1% MHR Institutional Partners III LP 29,256,557 21.4% MHR Institutional Advisors III LLC 29,256,557 21.4% Mark H. Rachesky, M.D. 40,243,247 29.4% About Lions Gate British Columbia-domiciled and Santa Monica, California- headquartered Lions Gate Entertainment Corp. is an independent producer and distributor of motion pictures, home entertainment, television programming and animation worldwide and holds a majority interest in the pioneering CinemaNow VOD business. Lions Gate's balance sheet at June 30, 2010, showed assets of $1,592,874,000, liabilities of $1,594,454,000, and a shareholders' deficiency of $1,580,000. Lions Gate carries 'B-' issuer credit ratings from Standard & Poor's. LIONS GATE VENTURES: Section 341(a) Meeting Scheduled for Feb. 15 ----------------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of Lions Gate Ventures, Inc.'s creditors on February 15, 2011, at 2:30 p.m. The meeting will be held at STE 300, 3685 Main Street, Riverside, CA 92501-2804. 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. Corona, California-based Lions Gate Ventures, Inc., dba Lions Gate Ventures, filed for Chapter 11 bankruptcy protection on January 5, 2011 (Bankr. C.D. Calif. Case No. 11-10409). Terrell Proctor, Esq., who has an office in Woodland Hills, California, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. LOUIS JONES ENTERPRISES: ERISA Problems Give Employee Priority -------------------------------------------------------------- WestLaw reports that a chapter 11 debtor-employer's failure to segregate wages withheld from its employee's paycheck for application toward premiums owing on a group health insurance policy, with the result that funds were seized by a creditor and not available to pay premiums, gave the employee a fifth-level priority claim for wages withheld and not applied less than 180 days before the petition date, as being in nature of a claim for contribution to an "employee benefit plan arising from services rendered within 180 days before the [filing] date." The employee also had an administrative expense claim for wages withheld and not applied postpetition. Finally, the employee had a claim for unreimbursed medical expenses that he incurred due to the cancellation of the policy, expenses that would have been covered under the policy had the debtor not been careless in carrying out its fiduciary duties under ERISA with respect to these withholdings. In re Louis Jones Enterprises, Inc., --- B.R. ----, 2010 WL 5263357 (Bankr. N.D. Ill.)(Schmetterer, J.). Louis Jones Enterprises, Inc., sought chapter 11 protection (Bankr. N.D. Ill. Case No. 10-11375) on Mar. 16, 2010. A copy of the Debtor's chapter 11 petition is available at http://bankrupt.com/misc/ilnb10-11375.pdfat no charge. The Debtor filed a chapter 11 plan of liquidating on Dec. 17, 2010, a modified plan on Jan. 10, 2011, and a disclosure statement, but provides no estimate of any distribution to unsecured creditors. A status hearing is scheduled for Feb. 24, 2011, at 10:30 a.m. in Chicago. MAGIC BRANDS: Luby's Sues Fuddruckers Licensee for Contempt ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that restaurant operator Luby's Inc., the purchaser of the Fuddruckers chain, wants the bankruptcy court in Delaware to hold a former franchisee in contempt for continuing to operate five stores under the Fuddruckers brand. The dispute is scheduled for hearing in bankruptcy court on Jan. 26. Luby's bought the Fuddruckers business from Magic Brands LLC for $63.45 million in a sale approved by the bankruptcy court in June. Mr. Rochelle recounts that businesses owned by Ralph Flannery operated five stores under franchise agreements. Luby's didn't buy the licenses with Flannery. After the sale to Luby's, Magic Brands terminated the Flannery licenses with permission from the bankruptcy court. According to Mr. Rochelle, Luby's wants Mr. Flannery held in contempt and directed by the bankruptcy court to stop using the Fuddruckers intellectual property. Mr. Rochelle notes that Mr. Flannery may argue he has the right to continue using the intellectual property under Section 365(n) of the U.S. Bankruptcy Code, which provides protections when licenses for intellectual property are rejected in bankruptcy. He adds that Mr. Flannery may be required to pay royalties if he succeeds in being allowed to continue using the marks. Flannery already raised the issue at the hearing for approval of the sale. 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 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 Debtor changed its name to Deel, LLC following the completion of the sale. MCGRATH'S PUBLICK: Employee Class Claim Loses Priority Status ------------------------------------------------------------- A class of former employees of McGrath's Publick Fish House, Inc., certified in a California state court proceeding, filed a claim for $185,496. The claimants assert that the entire claim is entitled to priority under 11 U.S.C. Sec. 507(a)(4). The Reorganized Debtor objected to the claim to the extent it asserts any priority. Chief Bankruptcy Judge Frank R. Alley, III, sustained the Debtor's objection. The claim will be allowed as a general unsecured claim for $185,496. Although the claim was filed by the claimant's attorney, payment should be made to CPT Group, Inc., the claims administrator designated by the Superior Court. About McGrath's Publick Fish House Salem, Oregon-based McGrath's Publick Fish House, Inc., fdba McGrath's Properties LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Ore. Case No. 10-60500) on February 3, 2010. The Company estimated assets and debts at $10 million to $50 million as of the petition date. The Debtor was represented by Leon Simson, Esq., Timothy J. Conway, Esq., and Haley B. Bjerk, Esq., at Tonkon Torp LLP, in Portland, Oregon, as counsel. McGrath's Plan of Reorganization was confirmed on November 15, 2010. MEDICAL WIND: IRS' Erroneous Tax Refund Claim Survives Dismissal ---------------------------------------------------------------- Magistrate Judge Mary Pat Thynge denied a defendant's request to dismiss the suit, United States of America, v. Bacara Partners, LLC; Larry Manth; Michael Rosenblum; Victoria Tan; Spinneret Financial Solutions, LLC; Alfred Hahnfeldt; and Joseph Gagliardi, C.A. No. 10-354 (D. Del.), as to Counts I and III, and granted the defendant's motion to dismissal as to Count II. On April 28, 2010, the United States sued Bacara and the other defendants to recover an erroneous refund of federal taxes and interest paid to Medical Wind Down Holdings I, Inc. Counts I-III of the complaint allege that: (1) the 1120X form is invalid pursuant to 26 U.S.C. Sec. 7405; (2) the assignment of "claims" contravened the Anti-Assignment Act pursuant to 31 U.S.C. Sec. 3727, and; (3) the refund included unsubstantiated "specified liability losses" pursuant to 26 U.S.C. Sec. 172(b)(1). Bacara sought dismissal of Counts I-III. Judge Thynge held that neither the statute of limitations under 26 U.S.C. Sec. 6532(b) nor res judicata and collateral estoppel bar the government's claims. Hence, Counts I and III should not be dismissed. Judge Thynge said Count II should be dismissed because the Anti-Assignment Act is precluded by operation of the bankruptcy court order approving the sale of MWDH I's remaining assets to Bacara, which included potential tax refund claims against the government. A copy of the Magistrate Judge's January 10, 2011 Report and Recommendation is available at http://is.gd/sgcpV4from Leagle.com. In a separate order, the Court denied defendant Joseph Gagliardi's motion to dismiss count IV of the complaint for failure to state a claim pursuant to Rule 12(b)(6). Count IV of the complaint specifically raises common law fraud, the sole claim against Mr. Gagliardi. The Court held that the facts, as pled in the complaint, support an inference that Mr. Gagliardi owed a duty of open, honest and straightforward disclosure to the IRS. A copy of the Judge's January 10, 2011 Report and Recommendation as to the Gagliardi matter is available at http://is.gd/x7xl9T from Leagle.com. Medical Wind Down Holdings, formerly known as Maxxim Medical Group Inc., were suppliers of custom-procedure trays, nonlatex examination gloves and other single-use products. The Debtor filed for chapter 11 protection (Bankr. D. Del. Case No. 03-10438) on February 11, 2003. Attorneys at Young, Conaway, Stargatt & Taylor, and Willkie Farr & Gallagher, represented the Debtor in its restructuring efforts. On November 10, 2003, through a court-approved sale, substantially all assets of the bankrupt estates were sold, and MWDH I ceased conducting business. MGM RESORTS: CityCenter Proposes to Offer $1.1-Bil. Notes --------------------------------------------------------- MGM Resorts International announced that CityCenter Holdings, LLC, a joint venture which is 50% owned by a wholly-owned subsidiary of the Company and 50% owned by Infinity World Development Corp., proposes to offer $1.1 billion in aggregate principal amount of first and second lien notes in a private placement. CityCenter plans to use the net proceeds from the offering to reduce its obligations under its existing credit facility in connection with amending and restating the credit facility to, among other things, extend the maturity of the remaining loans for four years. The notes proposed to be offered will not be registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States or to any U.S. persons absent registration under the Securities Act, or pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. The notes will be offered only to "qualified institutional buyers" under Rule 144A of the Securities Act or, outside the United States, to persons other than "U.S. persons" in compliance with Regulation S under the Securities Act. About MGM Resorts MGM Resorts International (NYSE: MGM) -- http://www.mgmresorts.com/-- has significant holdings in gaming, hospitality and entertainment, owns and operates 15 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, Illinois and Macau. * * * As reported by the Troubled Company Reporter on October 18, 2010, Standard & Poor's Ratings Services revised its rating outlook on MGM Resorts to stable from developing. At the same time, S&P affirmed all of its existing ratings on MGM, including the 'CCC+' corporate credit rating. The 'CCC+' corporate credit rating reflects MGM's significant debt burden, S&P's expectation for meaningful declines in cash flow generation in 2010, and the company's weak liquidity position. While MGM maintains a leading presence on the Las Vegas Strip, 2010 will be another challenging year for the Strip, and prospects for a meaningful rebound in 2011 are uncertain. The recent pricing of the primary offering of common stock has bolstered liquidity; however, the company's ability to weather the current downturn and continue to service its debt obligations over the longer term relies on continued progress toward addressing its challenging debt maturity schedule, as well as a substantial rebound in cash flow generation. The TCR also reported that Fitch Ratings revised the Rating Outlook for MGM Resorts to Positive following the company's equity issuance. In addition, Fitch affirmed the Issuer Default Rating at 'CCC'. MGM's 'CCC' IDR continues to reflect a credit profile with substantial credit risk. MGM's probability of default still displays a high sensitivity to an uninterrupted recovery in the Las Vegas market, significant reliance on a favorable refinancing and capital markets environment due to its heavy debt maturity schedule, a highly leveraged balance sheet despite potential debt reduction from the equity issuance, and a weak near-term free cash profile. In addition, MGM's obligation under the CityCenter completion guarantee continues to escalate, and Fitch believes the company is currently under-investing in its properties, which will likely impact asset quality. MICHAEL ARANDA: Checking Account 1 Not TBE Property --------------------------------------------------- Bankruptcy Judge Paul G. Hyman held that Michael Aranda's first checking account with United Bank cannot be a "Tenancy by the Entireties" property. Judge Hyman denied Mr. Aranda's claim of exemption in Account 1. Judge Hyman, however, gave Mr. Aranda a chance to prove that his second checking account is a TBE property. Judge Hyman said the Account 2 signature card is not dispositive regarding Mr. Aranda's intended form of ownership in that account. The Arandas may present evidence at trial that United Bank expressly prohibited them from selecting TBE as a form of ownership, and that the Arandas intended for Account 2 to be a TBE account. On May 23, 2008, Seacoast National Bank obtained a judgment against the Debtor in state court. Seacoast filed a judgment lien certificate against the Debtor on May 27, 2008, and served United with a writ of garnishment on September 2, 2008. The Debtor filed a chapter 11 bankruptcy petition on October 28, 2008. In his Amended Schedule C filed in the Chapter 11 case, Mr. Aranda claimed his two accounts at United Bank as exempt TBE property. The Debtor filed a complaint to avoid Seacoast's judgment and garnishment liens. The Debtor asserted that the Accounts were exempt TBE property. The Chapter 7 Trustee intervened in the adversary proceeding after the Debtor's case was converted. The Chapter 7 Trustee also objected to the Debtor's claim of exemption in the Accounts. The Chapter 7 Trustee seeks summary judgment against the Debtor with respect to the Objection and Count I of the Complaint. The case is Michael F. Aranda, Plaintiff, v. Seacoast National Bank, as Administrative and Collateral Agent, Defendant; and Michael R. Bakst, Trustee, Third-Party Plaintiff, v. Tonya Aranda Third-Party Defendant, Adv. Pro. No. 08-01768 (Bankr. S.D. Fla.). A copy of the Court's January 10, 2011 Memorandum Order is available at http://is.gd/C7cqyvfrom Leagle.com. Michael F. Aranda filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 08-26059) on October 28, 2008. Paul J. Battista, Esq., at Genovese Joblove & Battista, P.A., in Miami, Florida, served as bankruptcy counsel. In his petition, the Debtor estimated $1 million to $10 million in assets, and $10 million to $50 million in debts. The case was later converted to a case under Chapter 7. MOBILE TEAM: Hirschler Fleischer Not Subject to Disgorgement ------------------------------------------------------------ Chief Bankruptcy Judge Douglas O. Tice, Jr. denied the request of Harry Shaia Jr., chapter 7 trustee for the estate of The Mobile Team, LLC, to require the Debtor's counsel, Hirschler Fleischer, P.C., to disgorge the retainer paid prior to the filing of Debtor's Chapter 11 petition. Hirschler Fleischer opposed the motion and requested the Court to allow it to draw on the balance of its prepetition retainer. Judge Tice held that Hirschler Fleischer holds a security interest in the balance of the retainer and that the firm is not subject to disgorgement of the retainer. The firm must must give an accurate accounting for the retainer, including all amounts previously drawn. A copy of the Court's January 10, 2011 Memorandum Opinion and Order is available at http://is.gd/XNnckRfrom Leagle.com. Glen Allen, Virginia-based The Mobile Team, LLC, dba Team Mobile and dba WPB Communications, filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case No. 10-31771) on March 15, 2010. David K. Spiro, Esq. -- dspiro@hf-law.com -- at Hirschler Fleischer in Richmond, served as te Debtor's counsel. The Company had assets of $1,250,000 and total debts of $5,098,108, according to the schedules filed together with the petition. An order was entered on September 9, 2010, converting the Debtor's case to Chapter 7. Harry Shaia Jr. was appointed Chapter 7 trustee. Kaufman & Canoles P.C., who had served as counsel to the Official Committee of Unsecured Creditors in the Chapter 11 case, was approved to serve as counsel to the Chapter 7 trustee. The Chapter 7 Trustee is represented in the case by: Terry Catherine Frank, Esq. KAUFMAN & CANOLES, P.C. Three James Center, 12th Floor 1051 E. Cary Street Richmond, VA 23219 Telephone: (804) 771-5745 Facsimile: (804) 771-5777 E-mail: tcfrank@kaufcan.com The Official Committee of Unsecured Creditors is represented by: Dennis T. Lewandowski, Esq. KAUFMAN & CANOLES, P.C. 150 W. Main Street, Suite 2100 Norfolk, VA 23510 Telephone: (757) 624-3252 Facsimile: (757) 624-3169 E-mail: dtlewandowski@kaufcan.com MOLECULAR INSIGHT: Bondholders Want Investment Agreement Trashed ---------------------------------------------------------------- The Hon. Judge Frank J. Bailey of the U.S. Bankruptcy Court for the District of Massachusetts will convene a hearing today, January 14, 2011, at 9:30 a.m., to consider Molecular Insight Pharmaceuticals, Inc.'s assumption of an investment agreement with an equity investor. Dow Jones' Small Cap previously reported that Molecular Insight has sought approval to enter into a deal that would pave the way for a $45 million equity capital infusion while also opening up the Company to competing financial proposals. Under Molecular Insight's proposal, Savitr Capital LLC -- an existing shareholder of the company -- would essentially serve as the stalking horse in a process that would allow bondholders and other stakeholders to put forth competing financial proposals or attempt to negotiate more favorable treatment from Savitr under a possible consensual plan. Bondholders Object The Informal Bondholder Group objects to the Debtor's proposed assumption of Investment Agreement saying that it is fatally flawed and woefully inferior to a superior proposal that will be made by the Bondholders. The Bondholders will propose a well- constructed re-capitalization of the Debtor that includes a full equitization of the Debtor's prepetition debt obligations, together with a significant cash infusion. The Bondholders are certain holders of those senior secured floating rate bonds due November 2012 issued pursuant to that certain Indenture dated as of November 16, 2007, by and between the Debtor, as issuer, and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as trustee and collateral agent Assumption of Investment Agreement. As of the Petition Date, the Debtor was liable in respect of Bonds in an aggregate amount of not less than $199,998,573 (including any prepetition accrued interest thereon. The Investment Agreement contemplates a transaction that is tantamount to a complete restructuring and recapitalization of the Debtor's business, all outside of a plan context and all without the support of the Bondholders which hold virtually all of the debt in the Company. According to Bondholders, the Equity Investor Proposal is dependent upon, among other things: a) the emergence of the Debtor from bankruptcy by March 31, 2011; b) the Debtor's adherence to a cash collateral budget; c) satisfactory resolution of various issues related to OnaltaTM, a drug candidate; and d) entry of an order by the Court incorporating, among other things, (i) a confirmation order related to a chapter 11 plan and (ii) the Court's approval of a breakup fee and expense reimbursement for the benefit of the equity investor, Savitr Capital LLC; the $1,500,000 break-up fee and expense reimbursement is sought in addition to the $450,000 already paid by the Debtor to the Equity Investor even though there is no formal sale or auction process and despite the fact that a competitive bidding environment already exists. If one were to add the $450,000 received by the Equity Investor prior to the Petition Date, the true price of the entry into the Investment Agreement could approach almost $2,000,000. The Bondholders relate that their proposal can be accomplished quickly and efficiently. By contract, the Equity Investor Proposal is a highly speculative scheme predicated upon higher levels of debt and lower levels of liquidity. Moreover, consummation of the Equity Investor Proposal would require a successful cram down of the secured claims of the Bondholders, all at great risk to the Debtor which is without the financial wherewithal or the tolerance to sustain such a battle. About Molecular Insight Cambridge, Massachusetts-based Molecular Insight Pharmaceuticals, Inc., is a clinical-stage biopharmaceutical company that provides services on the detection and treatment of various forms of cancer and other life-threatening diseases. The Debtor disclosed $36,453,000 in total assets and $198,829,000 in total debts as of September 30, 2010. Molecular Insight filed for Chapter 11 bankruptcy protection on December 9, 2010 (Bankr. D. Mass. Case No. 10-23355). Alan L. Braunstein, Esq., at Riemer & Braunstein, LLP, serves as the Debtor's local Massachusetts counsel. Kramer Levin Naftalis & Franklin LLP serves as the Debtor's lead bankruptcy counsel. Foley & Lardner LLP is the Debtor's bankruptcy counsel. CRT Capital Group LLC is the Debtor's financial advisor. Tatum LLC, a division of SFN Professional Services LLC, is the Debtor's financial consultant. Omni Management Group, LLC, is the claims, and balloting agent. MORTGAGES LTD: Radical Bunny Managers Want SEC Fraud Case Nixed --------------------------------------------------------------- Bankruptcy Law360 reports that four managing members of Radical Bunny LLC accused of fraudulently funneling more than $189 million to Mortgages Ltd. have asked a judge to throw out the U.S. government's case, saying the notes they issued were not securities. About Mortgages Ltd. Phoenix, Arizona-based Mortgages Ltd. -- http://www.mtgltd.com/ -- acted as a full service private lender prior to filing for bankruptcy. Through its licensed broker dealer, Mortgages Ltd. Securities, ML received money raised from approximately 2,700 investors for placement into loans secured by real estate located solely in Arizona. These accredited investors financed the lending operations of ML and received as collateral for their funding direct fractional interests in "pass through" loans and deeds of trust or membership interests in "Opportunity Funds" which held fractionalized interests in loans and deeds of trust. Mortgages Ltd. was the subject of an involuntary Chapter 7 petition dated June 20, 2008, filed by KGM Builders Inc. -- a contractor for Grace Communities, a borrower of the company -- in the U.S. Bankruptcy Court for the District of Arizona. Central & Monroe LLC and Osborn III Partners LLC, divisions of Grace Communities, sought the appointment of an interim trustee for Mortgages Ltd. in the Chapter 7 proceeding. Mortgages Ltd. is also facing lawsuits filed by Grace Communities and Rightpath Limited Development Group for its alleged failure to fully fund loans. Mortgages Ltd. denied the charges. It has filed a motion to dismiss the Rightpath suit. The Debtor's case was converted to a chapter 11 proceeding on June 24, 2008 (Bankr. D. Ariz. Case No. 08-07465). Judge Sarah Sharer Curley presides over the case. Carolyn Johnsen, Esq., and Bradley Stevens, Esq., at Jennings, Strouss & Salmon P.L.C., replaced Todd A. Burgess, Esq., at Greenberg Traurig LLP, as counsel to the Debtor. As of December 31, 2007, the Debtor had total assets of $358,416,681 and total debts of $350,169,423. The Debtor recently emerged from Chapter 11 bankruptcy with an approved reorganization plan. MS GRAND: Chapter 11 Case Transferred to Alexandria --------------------------------------------------- Lanham, Maryland-based MS Grand Inc. received an order transferring its Chapter 11 bankruptcy case to Alexandria, Virginia (Bankr. E.D. Va. Case No. 11-10200) on Jan. 11, 2011. MS Grand Inc. originally filed a Chapter 11 petition in Greenbelt, Maryland (Bankr. D. Md. Case No. 10-33911) on Oct. 19, 2010. The docket indicates that Sam Wang Produce, Inc., T.M. Kovacevich Philadelphia, Inc., Four Season Produce, Inc., Ryeco, LLC, Eagle Fruit Traders, LLC, William Manis Company, C&E Farms, Inc., Amazon Produce Network, LLC, Tony Vitrano Company, Inc., Leone Produce, LLC, Earth Source Trading, Inc., I Love Produce, LLC, G. Cefalu & Bro., Inc. have commenced a lawsuit against MS Grand, Adv. Pro. No. 11-01027 (Bankr. E.D. Va.). Linda D. Regenhardt, Esq., at Baileygary PC, in Vienna, Virginia, represents the Debtor in the case. The Debtor disclosed $6,902,283 in assets and $8,510,034 in liabilities in its Schedules of Assets and Liabilities. MYSPACE INC: News Corp. Considering Spinoff or Sale --------------------------------------------------- Andy Fixmer and Sarah Rabil at Bloomberg News report that News Corp. is considering a possible spin-off or sale of MySpace, a day after cutting almost half of the social-networking Web site's workforce. "News Corp. is assessing a number of possibilities including a sale, a merger and a spinout," Rosabel Tao, a spokeswoman for MySpace said in an interview with Bloomberg News. "The process has just started." Bloomberg relates that the announcement signals News Corp.'s unwillingness to bear the unit's continuing losses, which amounted to less than $100 million in the year ended in June, an official for the site told Bloomberg in October. As reported in the January 12 edition of the Troubled Company Reporter, MySpace has unveiled plans cutting nearly half of its staff worldwide, or about 500 employees, after an extensive revamp in October 2010 overhauled its look and allowed it to be run with fewer workers. Myspace reduced its staff by nearly 30% in the summer 2010, or about 420 jobs. Myspace is a social networking Web site headquartered in Beverly Hills, California. NIELSEN CO: S&P Puts 'B+' Corp. Rating on CreditWatch Positive -------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B+' corporate credit rating for New York City-based The Nielsen Co. B.V., along with all related issue-level ratings on the Company's debt, on CreditWatch with positive implications. S&P rates the Company on a consolidated basis with subsidiaries Nielsen Finance LLC and Nielsen Finance Co. The positive CreditWatch listing is based on Nielsen's intention to launch an IPO of $1.75 billion, of which $1.5 billion will be in the form of common equity and $250 million will be in the form of a mandatorily convertible note. Proceeds of the offerings will be used to repay the Company's 12.5% discount note in its entirety; repay portions of the 11.125% notes due 2016, 11.5% notes due 2016, and 11.625% notes due 2014; and to terminate an advisory agreement with its sponsors. For the 12 months ended Sept. 30, 2010, adjusted leverage was high, at 7.1x, but modestly loS&Pr than at Dec. 31, 2009, when it was 7.5x. Adjusted leverage, pro forma for the $1.4 billion debt repayment following the contemplated IPO and giving full equity credit to the mandatorily convertible note, was roughly 6x for the last 12 months ended Sept. 30, 2010. For the third quarter ended Sept. 30, 2010, revenue increased 5.1%, or 6.8% on a constant currency basis, from the same period last year. Nielsen's "What Consumers Watch" segment revenue grew 3% on a constant currency basis and the "What Consumers Buy" segment grew 8.8% on a constant currency basis. Revenue growth in the "What Consumers Buy" segment was driven by strong growth in developing markets. Revenue growth also benefited from solid performance in the more discretionary business, Insights Services, which provides the Company's consumer products clients advanced analytics and consulting services. EBITDA was essentially flat year over year. S&P expect that revenue will increase at a mid- single-digit percentage rate and EBITDA will increase at a mid- to high-single-digit rate in 2011. "The positive CreditWatch listing reflects that S&P could raise the rating by one notch, depending on the ultimate size of the IPO and the amount of debt that the Company repays," said Standard & Poor's credit analyst Tulip Lim. NPS PHARMACEUTICALS: Ends Phase 3 Registration Study of GATTEX -------------------------------------------------------------- On January 10, 2011, NPS Pharmaceuticals, Inc. announced the completion of the 24-week treatment phase of the company's Phase 3 registration study of GATTEX(R) (teduglutide). The double-blind, placebo-controlled safety and efficacy study known as STEPS randomized 86 patients with parenteral nutrition (PN) dependent short bowel syndrome (SBS) to receive drug or placebo over a 24- week treatment period. "With the last patient's final clinical visit, we remain on track with our development timelines for GATTEX in short bowel syndrome," said Francois Nader, MD, president and chief executive officer of NPS Pharmaceuticals. "We look forward to reporting top line results later this quarter and to filing for marketing authorization with the U.S. Food and Drug Administration if the results are positive." NPS is also advancing STEPS 2, an open-label continuation study in which all participants will receive up to an additional 24 months of GATTEX therapy. Ninety-seven percent of eligible patients who completed STEPS elected to enroll in STEPS 2. SBS is a rare disorder characterized by inadequate absorption of fluids and nutrients in people who have had a significant portion of their small intestine removed. Some SBS patients require the use of chronic PN or intravenous feeding to supplement and stabilize their nutritional needs. GATTEX is NPS' proprietary analog of human glucagon-like peptide 2 (GLP-2), a naturally- occurring peptide involved in the repair and maintenance of normal structure and function of the intestine. The goal of treatment with GATTEX is to restore the structural and functional integrity of the remaining intestine to reduce PN dependence. About the STEPS Studies STEPS is an international, double-blind, placebo-controlled Phase 3 registration study to confirm that GATTEX is well tolerated and reduces PN dependence in adults with SBS. The company believes positive results from STEPS will enable it to seek U.S. marketing approval for GATTEX. Eighty-six PN-dependent SBS patients were randomized in the STEPS study at approximately 30 sites in North America and Europe. The trial included an initial three- to eight-week optimization and stabilization period, after which patients were randomized 1:1 to compare daily subcutaneous dosing of 0.05 mg/kg of GATTEX to placebo over a 24-week treatment period. The primary efficacy endpoint is the percentage of patients who achieve a 20 percent or greater reduction in weekly PN volume at week 20 and maintain that response at week 24, when compared to baseline. The study's secondary endpoints will evaluate efficacy variables based on reductions in PN volume or the direct effects of improved intestinal absorption of fluid. NPS expects to report top-line results from STEPS in the first quarter of 2011 and if positive, subsequently seek U.S. marketing approval for GATTEX in SBS. Patients who participated in STEPS had the option to enroll in STEPS 2, an open-label continuation study in which all participants will receive up to 24 months of GATTEX therapy. NPS is advancing STEPS and STEPS 2 with the support of its partner Nycomed and the two companies are sharing the external clinical costs for the studies. About Short Bowel Syndrome Short bowel syndrome, or SBS, is a highly disabling condition that can impair a patient's quality-of-life and lead to serious life- threatening complications. SBS typically arises after extensive resection of the bowel due to Crohn's disease, ischemia or other conditions. SBS patients often suffer from malnutrition, severe diarrhea, dehydration, fatigue, osteopenia, and weight loss due to the reduced intestinal capacity to absorb nutrients, water, and electrolytes. The usual treatment for short bowel syndrome is nutritional support, including parenteral nutrition (PN) or intravenous feeding to supplement and stabilize nutritional needs. Although PN can provide nutritional support for short bowel syndrome patients, it does not improve the body's own ability to absorb nutrients. PN is also associated with serious complications, such as infections, blood clots or liver damage, and the risks increase the longer patients are on PN. Patients on PN often experience a poor quality-of-life with difficulty sleeping, frequent urination and loss of independence. There are an estimated 10,000 to 15,000 SBS patients in North America who are dependent on PN, the direct cost of which can exceed $100,000 annually per patient. About GATTEX(R) (teduglutide) GATTEX (teduglutide) is a novel, recombinant analog of human glucagon-like peptide 2, a protein involved in the rehabilitation of the intestinal lining. GATTEX is in Phase 3 development to reduce dependence on parenteral nutrition (PN) in patients with short bowel syndrome (SBS). NPS has reported findings from completed studies in which GATTEX demonstrated a favorable safety profile and reductions in mean PN volume from pretreatment baseline were observed. NPS is also advancing preclinical studies to evaluate teduglutide in additional intestinal failure related conditions. Teduglutide has received orphan drug designation for the treatment of SBS from the U.S. Food and Drug Administration and the European Medicines Agency. In 2007, NPS granted Nycomed the rights to develop and commercialize teduglutide outside the United States, Canada and Mexico. NPS retains all rights to teduglutide in North America. About NPS Pharmaceuticals Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq: NPSP) -- http://www.npsp.com/-- is developing new treatment options for patients with rare gastrointestinal and endocrine disorders. NPS noted in its Form 10-K for the year ended Dec. 31, 2009, it has not been profitable since its inception in 1986. As of December 31, 2009, it had an accumulated deficit of $922.7 million. "Currently, we are not a self-sustaining business and certain economic, operational and strategic factors may require us to secure additional funds." The Company though believes its existing capital resources at December 31, 2009, along with the receipt of $38.4 million from the sale of its REGPARA royalty stream, should be sufficient to fund its current and planned operations through at least January 1, 2011. The Company's balance sheet at Sept. 30, 2010, showed $228.82 million in total assets, $378.65 million in total liabilities, and a stockholders' deficit of $149.82 million. NPS PHARMACEUTICALS: Wins Favorable Verdict Against Teva & Barr --------------------------------------------------------------- On January 7, 2011, the United States District Court, District of Delaware ruled in favor of NPS Pharmaceuticals, Inc., Amgen, Inc. and The Brigham and Women's Hospital in their lawsuit against Teva Pharmaceuticals USA, Inc., Teva Pharmaceutical Industries Ltd. and Barr Laboratories, Inc. The Plaintiffs' lawsuit was based on Abbreviated New Drug Applications, or ANDAs, filed by Teva and Barr which seek approval to market generic versions of Sensipar(R). The court's order enjoined Teva and Barr from the commercial manufacture, use, import, offer for sale, or sale of their generic cinacalcet hydrochloride until the expiration of U.S. Patent Nos. 6,011,068; 6,031,003 and 6,211,244. U.S. Patent No. 6,011,068 is the last of these patents to expire, which, by virtue of patent term extension, will be on March 8, 2018. About NPS Pharmaceuticals Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq: NPSP) -- http://www.npsp.com/-- is developing new treatment options for patients with rare gastrointestinal and endocrine disorders. NPS noted in its Form 10-K for the year ended Dec. 31, 2009, it has not been profitable since its inception in 1986. As of December 31, 2009, it had an accumulated deficit of $922.7 million. "Currently, we are not a self-sustaining business and certain economic, operational and strategic factors may require us to secure additional funds." The Company though believes its existing capital resources at December 31, 2009, along with the receipt of $38.4 million from the sale of its REGPARA royalty stream, should be sufficient to fund its current and planned operations through at least January 1, 2011. The Company's balance sheet at Sept. 30, 2010, showed $228.82 million in total assets, $378.65 million in total liabilities, and a stockholders' deficit of $149.82 million. OTTER TAIL: Proposes Green Plains-Led Auction for Ethanol Plant --------------------------------------------------------------- Green Plains Renewable Energy, Inc., has signed an asset purchase agreement with Otter Tail Ag Enterprises, LLC to acquire Otter Tail's 55 million gallon per year capacity dry-mill ethanol plant near Fergus Falls, Minn. The proposed transaction is anticipated to progress through a court-approved bankruptcy proceeding initiated by Otter Tail Ag Enterprises, LLC. If confirmed by the Bankruptcy Court, Green Plains' bid would then be considered the stalking horse in an asset auction to be held in the next 60 days. Otter Tail is asking the U.S. Bankruptcy Court for the District of Minnesota to authorize the sale of all of its assets in an auction led by OTAV LLC. The assets to be sold consist of the real property, buildings, process equipment, including the Solid Waste Facility, and other fixed assets of the Debtor's ethanol manufacturing plant located in Fergus Falls, Minnesota. The purchased assets will also include input, product, and parts inventories. The Debtor entered into an asset purchase agreement with OTAV LLC, which provides for a purchase price of a) a base price of $55,000,000 comprised of assumed indebtedness and a cash payment; b) payment for prepaid expenses at closing; and c) payment for inventories. The estimated total purchase price is $62,544,486. A partial source of of the buyer's funds will be from financing from Agstar Financial Services, PCA, the Debtor's largest secured creditor, and a portion of the purchase price will include the assumption of the MMCDC New Markets Fund II, LLC indebtedness. The APA also includes an expense reimbursement up to $100,000. The Debtor also asks that the Court permit the assignment of related unexpired leases and executory contracts to the highest and best bidder. In the event of any competing bids for the assets, resulting in OTAV not being the successful Buyer, it will receive a breakup fee of $1,000,000 to be paid at the time of the closing of the sale with such third party buyer. OTAV may terminate the APA if it is the successful bidder at the auction and the closing does not occur on or before April 15. Carl Marks Advisory Group, LLC, assisted the Debtor in marketing its assets. The Debtor further requests that these sale related dates be approved: Sale Procedures Hearing January 27, 2011, at 11:30 a.m. Objections Deadline January 21 Auction February 16, at 10:00 CDT at the Offices of Mackall, Crounse & Moore, PLC, Suite 1400, 901 Marquette Avenue, Minneapolis, Minnesota. Sale Approval Hearing February 17 at 1:30 p.m. Objections Deadline February 11 Bid Deadline February 11, at 3:00 p.m. CST A hearing to consider approval of the sale rules is scheduled for January 27, 2011. Green Plains Expansion "We remain focused on our growth strategy of acquiring operating assets that expand our ethanol platform and contribute immediately to our financial results," stated Todd Becker, President and CEO of Green Plains Renewable Energy, in a statement. "If we are successful in the auction process, we believe our proven management capabilities will add value for all stakeholders." If completed, the acquisition would increase Green Plains' ethanol production capacity by approximately 8% to an annual capacity of 712 million gallons. Green Plains plans to finance the transaction through a mix of available cash on hand and debt financing from existing lenders. Bloomberg News notes that Green Plains has used a series of acquisitions to almost double its output since May 2009. The Company bought Global Ethanol LLC and acquired its plants in Lakota, Iowa, and Riga, Michigan, for $169.2 million in October. Those two mills have total capacity to produce 157 million gallons of the fuel. In 2009, it bought plants in Central City and Ord, Nebraska, for $123.5 million from AgStar Financial Services, which had acquired the distilleries from bankrupt producer VeraSun Energy Corp. About Green Plains Green Plains Renewable Energy, Inc. (Nasdaq:GPRE) is North America's fourth largest ethanol producer, operating a total of eight ethanol plants in Indiana, Iowa, Michigan, Nebraska and Tennessee with annual expected operating capacity totaling approximately 657 million gallons. Green Plains owns 51% of Blendstar, LLC, a biofuel terminal operator which operates nine blending or terminaling facilities in seven states in the south central United States. About Otter Tail AG Based in Fergus Falls, Minnesota, Otter Tail AG Enterprises, LLC -- http://www.ottertailethanol.com/-- owns and operates a nameplate capacity 55 million gallon annual production plant of undenatured ethanol in Fergus Falls, Minnesota. The Company processes approximately 20 million bushels of corn into approximately 55 million gallons of ethanol each year. In addition, the Company sells distillers grains, a principal co-product of the ethanol production process. The Company filed for Chapter 11 on Oct. 30, 2009 (Bankr. D. Minn. Case No. 09-61250). The Debtor disclosed assets of $66.4 million against $86 million in debt, nearly all secured, in its schedules. The largest secured creditor is AgStar Financial Services, owed $40.9 million. OVERSEAS SHIPHOLDING: S&P Lowers Corporate Rating to 'B' -------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term corporate rating on Overseas Shipholding Group Inc. (OSG) to 'B' from 'BB-'. At the same time, S&P lowered S&P's ratings on the Company's senior unsecured debt to 'B' from 'BB-', the same as the new corporate credit rating. The '4' recovery rating remains unchanged, indicating S&P's expectation that lenders will receive an average (30%-50%) recovery in a payment default scenario. S&P is removing all ratings from CreditWatch, where it placed them with negative implications on Dec. 13, 2010. The outlook is stable. "The downgrade reflects OSG's weakened financial profile, caused by prolonged revenue and earnings declines and a significant debt burden that we expect to increase somewhat over the next year, as the Company funds $374.1 million in remaining capital commitments under its vessel new build program," said Standard & Poor's credit analyst Funmi Afonja. As of Sept. 30, 2010, OSG had $3.2 billion in lease adjusted debt. OSG's revenues and earnings are vulnerable to volatile spot market rates, with 82.2% of the Company's revenue days from the international crude oil business for the quarter ended Sept. 30, 2010, in the spot market, the highest in three years. Very large crude carriers (VLCCs) that generate a significant portion of OSG's total revenues tend to have the most volatile rates, relative to smaller tankers. For example, average spot market time charter equivalent (TCE) rates on VLCCs, though up 46% during the third quarter of 2010, compared with the prior year period, were down by 86% compared with the strong third quarter of 2008. As a result of the significant decline in tanker rates, revenues are down 15% for the 12 months ended Sept. 30, 2010, compared with the previous period, and down 34% compared with Sept. 30, 2008. Lower revenues, combined with higher operating expenses from managing a larger fleet, caused operating margins (after depreciation and amortization) to decline to 8.1% in the quarter ended Sept. 30, 2010, compared with 15.8% in the previous year period and 34.8% in September 2008. The ratings on OSG reflect the Company's highly leveraged financial profile, the competitive nature of the shipping industry, and the Company's historically aggressive financial policy, with substantial share repurchases during 2007 and 2008. Positive credit factors include adequate liquidity, a relative strong point in the Company's financial profile, and a well- established market position in the ocean transportation of crude oil and petroleum products. S&P characterize OSG's business profile as weak and its financial risk profile as highly leveraged. The outlook is stable and reflects S&P's expectations that the Company will continue to have sufficient liquidity to work through the weak operating environment and that the Company will eventually benefit from a recovery in tanker rates over the next several years. "We could lower the ratings further if continued weakness in tanker rates or incremental debt to finance new vessels caused funds flow from operations to debt to fall below 5% or EBITDA interest coverage to fall below 1x on a sustained basis," Ms. Afonja added. "We believe that an upgrade is unlikely over the next year, given the steep deterioration in the Company's financial profile and current market conditions." PERRY ELLIS: Rafaella Buyout Cues Moody's to Hold 'B2' Ratings -------------------------------------------------------------- Moody's Investors Service affirmed the positive outlook and the B2 corporate family and probability of default ratings of Perry Ellis International, Inc., as well as the B3 rating on its subordinated bonds. The action follows its announced plans to acquire Rafaella Apparel Group, Inc. The debt-funded transaction modestly increases leverage, but Perry's strongly positioned B2 CFR can tolerate the slight weakening of credit metrics. Furthermore, the acquisition enhances product diversity, and the greater scale of the combined entity could help it to become a more meaningful supplier to Perry's large retail customers. Moody's estimates the approximately $70 million acquisition, to be funded through borrowings under Perry Ellis's revolving credit facility and balance sheet cash, will increase leverage to approximately 3.3 times debt-to-EBITDA from 3 times for the trailing twelve months ended October 30, 2010. Rafaella ratings will be addressed upon completion of the transaction. If substantially all of Rafaella's bonds are repaid in conjunction with the transaction, Moody's would likely withdraw all Rafaella ratings, including the Caa3 Probability of Default Rating, the Caa3 Corporate Family Rating, and the Ca rating on its senior secured bonds. A summary of the actions follows. Perry Ellis International, Inc. -- Affirmed B2 Corporate Family Rating -- Affirmed B2 Probability of Default Rating -- Senior Subordinated Bonds, Affirmed B3, LGD adjusted to LGD5, 77% from LGD5, 76% Outlook, Positive Perry's B2 CFR incorporates its narrow product focus, as well as high customer concentration and EBITA margins that lag most rated apparel peers. Credit metrics are fairly strong relative to the B2 corporate family rating, and Moody's anticipates improvement over next year. Nevertheless, at over 3 times debt-to-EBITDA, the leverage poses challenge for operating in an industry sensitive to both consumer spending and fashion trends. The company's well- known brand portfolio and good liquidity, including expectations for continued positive free cash flow, support the rating. The positive outlook reflects the potential for an upgrade with evidence of smooth integration of the Rafaella business and commitment to reducing debt and maintaining a conservative credit profile, as well as continued strong operating performance. Specific metrics necessary for Perry to achieve a B1 corporate family rating include expectations for sustained leverage around 3.25 times debt-to-EBITDA, continued positive free cash flow, and EBITA-to-interest greater than 3 times. An upgrade would also require good liquidity. Moody's would likely revise the outlook to stable based on lack of progress in reducing leverage, deterioration of the liquidity profile, or sales or EBITDA declines. Perry Ellis International designs, distributes and licenses apparel and accessories for men and women. The company, through its wholly owned subsidiaries, owns or licenses a portfolio of brands that includes Perry Ellis, Jantzen, Laundry by Shelli Segal, C&C California, Original Penguin by Munsingwear, Callaway, Cubavera, Savane, Farah, Gotcha, and Nike Swim. Its revenue for the trailing twelve months ended October 30, 2010, was approximately $780 million. The most recent rating action for Perry Ellis occurred on June 24, 2010. At that time, Moody's affirmed the B2 corporate family rating and changed the outlook to positive from negative. The principal methodologies used in this rating were Global Apparel Industry published in May 2010, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. PRECISION OPTICS: Marxe and Greenhouse Hold 69.5% Equity Stake -------------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on January 10, 2011, Austin W. Marxe and David M. Greenhouse disclosed that each of them beneficially owns 1,538,099 shares of common stock of Precision Optics, Corp. representing 69.5% of the shares outstanding. The number of shares outstanding of the Company's common stock, par value $0.01 per share, at November 12, 2010 was 1,018,411 shares. Marxe and Greenhouse share sole voting and investment power over 1,098 shares of Common Stock owned by Special Situations Cayman Fund, L.P., 0 shares of Common Stock owned by Special Situations Fund III, L.P., 160,301 shares of Common Stock, 7,630,000 Warrants to purchase 377,200 Common Shares and $275,000 Debenture convertible into 220,000 Common Shares owned by Special Situations Fund III QP, L.P., 160,000 shares of Common Stock, 7,630,000 Warrants to purchase 377,200 Common Shares and $275,000 Debenture convertible into 220,000 Common Shares owned by Special Situations Private Equity Fund, L.P., and 22,300 shares of common stock owned by Special Situations Technology Fund II, L.P. Austin W. Marxe and David M. Greenhouse, who are the controlling principals of AWM Investment Company, Inc., the general partner of and investment adviser to Special Situations Cayman Fund, L.P. AWM also serves as the general partner of MGP Advisers Limited Partnership, the general partner of and investment adviser to Special Situations Fund III, L.P. and general partner of Special Situations Fund III QP, L.P. (SSFQP). Marxe and Greenhouse are also members of MG Advisers L.L.C., the general partner of Special Situations Private Equity Fund, L.P., and members of SST Advisers, L.L.C. (?SSTA?), the general partner of Special Situations Technology Fund II, L.P. AWM serves as the investment adviser to SSFQP, SSPE, and Tech II. Cayman owns 1,098 shares of Common Stock or 0.1% of the shares outstanding, SSF3 owns 0 shares of Common Stock or 0.0% of the shares outstanding, SSFQP owns 160,301 shares of Common Stock, 7,630,000 Warrants to purchase 377,200 Common Shares and $275,000 Debenture convertible into 220,000 Common Shares or 46.9% of the shares outstanding, SSPE owns 160,000 shares of Common Stock, 7,630,000 Warrants to purchase 377,200 Common Shares and $275,000 Debenture convertible into 220,000 Common Shares or 46.9% of the shares outstanding, and Tech II owns 22,300 shares of common stock or 2.2% of the outstanding shares. Messrs. Marxe and Greenhouse share the power to vote and direct the disposition of all shares of Common Stock owned by each of the Funds. Messrs. Marxe and Greenhouse are deemed to beneficially own a total of 343,699 shares of Common Stock, 15,260,000 Warrants to purchase 754,400 Common Shares and $550,000 Debentures convertible into 440,000 Common Shares or 69.5% of the outstanding shares. About Precision Optics Gardner, Mass.-based Precision Optics Corporation, Inc. (OTC BB: PEYE) -- http://www.poci.com/-- designs, develops, manufactures and sells specialized optical systems and components and optical thin-film coatings. The Company conducts business in one industry segment only and its customers are primarily domestic. The Company's products and services fall into two principal areas: (i) medical products for use by hospitals and physicians; and (ii) advanced optical system design and development services and products used by industrial customers. The Company's balance sheet at Sept. 30, 2010, showed $1.72 million in total assets, $2.03 million in total liabilities, and a stockholders' deficit of $318,919. Going Concern Doubt Stowe & Degon LLC, in Westborough, Mass., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring net losses and negative cash flows from operations. The Company has sustained recurring net losses for several years. As of June 30, 2010, the Company has an accumulated deficit of $38.4 million. As of June 30, 2010, cash and cash equivalents were $416,040, accounts receivable were $505,200, and current liabilities were $2.1 million. The Company anticipates that deferred officers' salaries and director consulting expenses accrued at June 30, 2010, will be settled by issuing restricted common stock rather than by cash payments. These deferred amounts included in current liabilities at June 30, 2010, total roughly $574,000. PRECISION PARTS: Gibraltar Settles $3-Mil. Preference for $2,000 ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports Gibraltar Industries Inc., a creditor of Precision Parts International Services Corp., escaped from liability for a $3.23 million preference by paying only $2,000. The settlement was approved last week by the U.S. Bankruptcy Court in Delaware. Gibraltar was able to avoid paying more by using the new value defense. Headquartered in Rochester Hills, Michigan, Precision Parts International Services Corp. -- http://www.precisionparts.com/-- sold products to major north American automotive and non- automotive original equipment manufacturers and Tier 1 and 2 suppliers. PPI and its units operated six manufacturing facilities throughout North America, including a facility in Mexico operated on their behalf by Intermex Manufactura de Chihuahua under a shelter and logistics agreement. The Company and eight of its affiliates filed for Chapter 11 protection on December 12, 2008 (Bankr. D. Del. Lead Case No. 08-13289). Attorneys at Pepper Hamilton LLP are bankruptcy counsel to the Debtors. Alvarez & Marsal North America LLC is the Debtor's financial advisors and Kurtzman Carson Consultants LLC is the claims, noticing and balloting agent. PPI Holdings, Inc., estimated assets and debts between $100 million and $500 million in its Chapter 11 petition. QWEST COMMUNICATIONS: BlackRock Holds 11.39% Equity Stake --------------------------------------------------------- On January 10, 2011, BlackRock, Inc., disclosed in an amended Schedule 13G with the Securities and Exchange Commission that it beneficially owns 198,470,658 shares of common stock of Qwest Communications International common stock representing 11.39% of the shares outstanding. As of October 28, 2010, there were 1,742,716,118 shares of common stock outstanding of the Company. About Qwest Based in Denver, Colorado, Qwest Communications (NYSE: Q) -- http://www.qwest.com/-- offers residential customers a new generation of fiber-optic Internet service, high-speed Internet solutions, as well as digital home phone, wireless service available through Verizon Wireless and DIRECTV services. Qwest is also the choice of 95% of Fortune 500 companies, offering a full suite of network, data and voice services for small businesses, large businesses, government agencies and wholesale customers. Additionally, Qwest participates in Networx, the largest communications services contract in the world, and is recognized as a leader in the network services market by leading technology industry analyst firms. Qwest carries a 'Ba1' corporate family and probability of default ratings from Moody's and has 'BB' issuer credit ratings from Standard & Poor's. "Our high debt levels pose risks to our viability and may make us more vulnerable to adverse economic and competitive conditions, as well as other adverse developments," the Company said in its Form 10-K for the year ended Dec. 31, 2009. At Dec. 31, the Company's consolidated debt was approximately $14.2 billion. Approximately $5.8 billion of its debt obligations come due over the next three years. This amount includes $1.265 billion of our 3.50% Convertible Senior Notes due 2025, which it may elect to redeem at any time on or after November 20, 2010 and holders may require the Company to repurchase for cash on November 15, 2010. The Company's balance sheet at June 30, 2010, showed $18.95 billion in total assets, $20.20 billion in total liabilities, and a stockholders' deficit of $1.24 billion. Fitch Ratings is maintaining the Rating Watch Positive on the 'BB' Issuer Default Rating assigned to Qwest Communications International, Inc. and its subsidiaries. Concurrently, Fitch has affirmed the 'BBB-' issue rating assigned to Qwest's $1.035 billion senior secured credit facility and the senior unsecured debt issued by Qwest Corporation. Approximately $13.1 billion of debt outstanding as of June 30, 2010, including $7.9 billion of debt outstanding at QC, is affected by Fitch's action. RECKSON OPERATING: Moody's Raises Senior Debt Ratings to 'Ba1' -------------------------------------------------------------- Moody's Investors Service upgraded the senior debt ratings of Reckson Operating Partnership, L.P., to Ba1 from Ba2. Reckson Operating Partnership is an indirect subsidiary of SL Green Realty Corporation. The outlook is stable. The rating upgrade follows an on-going review of SLG's organizational structure and business strategy, specifically as it relates to the assets and financial profile of ROP. Moody's expects ROP's asset composition and financial profile to remain largely unchanged over the near-term. The Ba1 ratings reflect the support provided to ROP's 2020 and 2025 bonds by SLG and SL Green Operating Partnership , as well as the guaranties that ROP provides to both SLG 2007 bank facility and SLG's 2017 convertible notes. Another key factor supporting the upgrade is that the unencumbered assets of ROP cover all direct and guaranteed debt obligations by 1.8X. The stable outlook reflects Moody's expectation that the financial leverage of SL Green, which was reduced over the last two years, will remain stable as the REIT grows and office market fundamentals improve. Moody's noted that ROP's effective leverage is similar to SLG's when taking into account the guaranties that ROP provides to select SLG debt obligations. However, ROP has little secured debt and a large pool of unencumbered assets. Fixed charge coverage was strong at 3Q10. Moody's expects ROP's and SLG's operating performance to improve over the near-term as the New York office market recovery advances. A key rating concern for ROP is its significant asset concentration in midtown Manhattan. ROP's four largest properties are located in midtown Manhattan and account for approximately 69% of its annualized rent, and one property alone accounts for 27% of its annualized rent. In addition, SLG has geographic concentration in midtown Manhattan, tenant concentration and industry concentration. SLG's top five tenants account for 29% of its annualized base rent and the financial services sector represents 40% of annualized base rent at 3Q10. Moody's indicated that upward rating momentum could result should ROP's parent, SL Green, continue to make improvements to its financial profile as evidenced by lower leverage levels, lower secured debt levels and a larger pool of unencumbered assets to offset its portfolio concentrations and large use of joint ventures. In addition, a more balanced asset liability funding strategy as evidenced by lower variable rate debt levels would also be a positive. Ratings would most likely come under downward pressure should ROP's financial profile, namely leverage and unencumbered asset base, deteriorate over the intermediate term, reducing protection to the senior unsecured bondholders. In addition, a rating downgrade could result should SLG reverse its course of deleveraging its balance sheet. The following ratings were upgraded: * Reckson Operating Partnership, L.P. -- Senior unsecured debt to Ba1 from Ba2 * Moody's last rating action with respect to Reckson Operating Partnership, L.P., was on January 13, 2010 -- when Moody's affirmed the senior debt ratings of ROP at Ba2 and revised its outlook to stable. The principal methodology used in this rating was Rating Methodology for REITs and Other Commercial Property Firms published in July 2010. SL Green Realty Corporation is a real estate investment trust primarily focused on owning and operating office buildings in Manhattan. As of September 30, 2010, the REIT owned interests in 61 office properties totaling 29 million square feet in the New York Metro area. At September 30, 2010, the REIT reported $10.6 billion in book assets and $5.3 billion in book equity. RIPTIDE HOTEL: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Riptide Hotel, LLC 2300 N. Surf Rd Hollywood Beach, FL 33019 Bankruptcy Case No.: 11-10625 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: Raymond B. Ray Debtor's Counsel: Paul DeCailly, Esq. DECAILLY, P.A. 3111 W Dr Martin Luther King Jr. Blvd., #100 Tampa, FL 33607 Tel: (813) 286-2909 Fax: (866) 906-5977 E-mail: ecf@pdlaw.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $0 to $50,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Scott Thomson, managing member. ROBERT MIELL: Bid to Dismiss Ch. 7 Trustee Proceed to Trial ----------------------------------------------------------- Bankruptcy Judge Paul J. Kilburg denied the U.S. Trustee's request to dismiss Robert K. Miell's motion to remove the Chapter 7 trustee overseeing his bankruptcy case and request for stay for lack of prosecution. The Debtor asserts there is cause to remove Renee Hanrahan as Trustee. He argues she is not a disinterested person. The Debtor also asserts the Trustee has mismanaged the estate and acted without authority. The U.S. Trustee and the Chapter 7 Trustee objected, asserting the Debtor cannot meet the burden to show cause to remove the Chapter 7 Trustee. Guaranty Bank & Trust, State Farm Bank, Luana Savings Bank, and University of Iowa Community Credit Union have filed joinders in the objections to the Motion to Remove Trustee. The Court will proceed with trial scheduled for February 1, 2011. Judge Kilburg said the trial will, however, be bifurcated so that it is limited to te Debtor's presentation only. The Court will review his offers of evidence for admissibility and determine whether he has met his burden of proof under 11 U.S.C. Sec. 324(a) for removal of the Chapter 7 Trustee. If necessary, the Court will then set a time for the U.S. Trustee and Chapter 7 Trustee to make their presentations. A copy of the Court's Jan. 11, 2011 Order is available at http://is.gd/b1iWPRfrom Leagle.com. Robert E. Miell is incarcerated in the County Jail in Marengo, Iowa, awaiting transfer to a federal facility. He has been in jail since early in his bankruptcy case. Mr. Miell, represented by attorneys, filed a voluntary Chapter 11 petition (Bankr. N.D. Iowa Case No. 09-01500), without schedules and statements, on May 28, 2009. The Debtor filed his Schedules and Statements on June 29, 2009, and amended them on July 13, 2009. The Court converted the case to Chapter 7 and appointed a Chapter 7 Trustee on October 9, 2009. The attorney who represented Debtor most recently withdrew on September 20, 2010. He is currently proceeding without counsel. RYLAND GROUP: BlackRock Discloses 10.17% Equity Stake ----------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on January 10, 2011, BlackRock, Inc., disclosed that it beneficially owns 4,487,126 shares of common stock of The Rland Group Inc. representing 10.17% of the shares outstanding. The number of shares of common stock of The Ryland Group, Inc., outstanding on November 4, 2010, was 44,120,622. About Ryland Group Headquartered in Calabasas, California, The Ryland Group, Inc. (NYSE: RYL) -- http://www.ryland.com/-- is one of the nation's largest homebuilders and a leading mortgage-finance company. Since its founding in 1967, Ryland has built more than 285,000 homes and financed more than 240,000 mortgages. The Company currently operates in 15 states and 19 homebuilding divisions across the country and is listed on the New York Stock Exchange under the symbol "RYL." For the third quarter ended September 30, 2010, the Company reported a consolidated net loss of $29.9 million compared to a consolidated net loss of $52.5 million for the same period in 2009. The Company reported total revenues of $212.74 million for the three months ended Sept. 30, 2010, compared with $327.83 million in the third quarter of 2009. The Company's balance sheet at Sept. 30, 2010, showed $1.70 billion in total assets, $1.11 billion in total liabilities, and stockholders' equity of $585.75 million. * * * As reported by the Troubled Company Reporter on June 21, 2010, Fitch Ratings has affirmed Ryland Group, Inc.'s ratings -- Issuer Default Rating at 'BB'; and Senior unsecured debt at 'BB'. The Rating Outlook has been revised to Stable from Negative. Ryland Group carries Moody's "Ba3" corporate family rating, "Ba3" probability of default rating, "Ba3" senior unsecured notes rating, and "SGL-2" speculative grade liquidity rating. Ryland Group carries Standard & Poor's Ratings Services' 'BB-' corporate credit and senior unsecured note ratings. SBARRO INC: Ares Management Aiming to Take 'Out' Owner, KDP Says ---------------------------------------------------------------- Ares Management LLC, the Los Angeles investment firm, is trying to gain influence over a possible restructuring of MidOcean Partners- owned Sbarro Inc., Christine Idzelis at Bloomberg News reported, citing KDP Investment Advisors Inc. "We think the group is looking to take MidOcean out of the equation or at least use the litigation to attempt to extract more value in a restructuring," KDP analyst Barbara Cappaert said in a Jan. 6 report. The second-lien loan was used to reduce first-lien debt. Sbarro is in danger of missing an interest payment on its notes after violating a financial covenant under its bank debt, according to the report. "While we think the company may be able to negotiate an extension of the bank forbearance, given the higher interest rates to be paid on the $173 million of outstanding bank debt and letter-of- credits, we doubt the company will make the February 1, 2011 interest payment on the 10.375% senior notes," Ms. Cappaert wrote in the report. Restructuring Professionals According to reports, Sbarro has hired Kirkland & Ellis to examine restructuring options including a potential bankruptcy filing. Sbarro has stated in a regulatory filing that it has engaged Rothschild Inc. as its financial advisor to explore strategic alternatives addressing its current capital structure. Forbearance Agreement As reported by the TCR on January 10, 2011, Sbarro, together with its parent, Sbarro Holdings, LLC, effective January 3, entered into a Forbearance Agreement with its lenders under its First Lien Credit Agreement and Bank of America, N.A., as Administrative Agent under the First Lien Credit Agreement, anticipating that it would not be in compliance with one of the financial covenants in its First Lien Credit Agreement as of January 2, 2011. On January 3, the Company provided a notice of default to the First Lien Holders regarding this anticipated failure to meet a financial covenant in the First Lien Credit Agreement. Pursuant to the Forbearance Agreement, the First Lien Holders have agreed to temporarily forbear from exercising certain rights and remedies under the First Lien Credit Agreement solely by reason of the First Lien Default or the delivery of the Indenture Notice. Specifically, until the Forbearance Agreement terminates, the First Lien Holders have agreed not to terminate the commitments, accelerate the loans, require cash collateral for the letter of credit obligations, enforce liens granted under the collateral documents or exercise any other rights or remedies that may be available under the loan documents in respect of the First Lien Default or the delivery of the Indenture Notice. The Company has acknowledged that as a result of the First Lien Default (i) the Company's consent right in respect of certain assignments is no longer in effect, (ii) all outstanding loans bear interest at the default rate (contract rate + 2%), which will result in incremental interest of approximately $860,000 for the first quarter of fiscal year 2011, and (iii) the Company is not entitled to convert eurodollar loans to, or continue any eurodollar loans for additional interest periods as, eurodollar loans having an interest period in excess of one month. The Company has also agreed to pay a fee to each lender that consents to the Forbearance Agreement of 15 basis points on the principal amount of loans held by such lender under the First Lien Credit Agreement. As of January 3, 2011, the Company has paid consenting lenders a forbearance fee of $246,063 in aggregate. The Forbearance Agreement terminates on the earliest of (i) January 31, 2011, (ii) the date on which any event of default under the First Lien Credit Agreement other than the First Lien Default shall occur, (iii) the date of any breach by Holdings or the Company of the Forbearance Agreement, and (iv) the date on which any holder of the Company's senior notes or any of the Company's second lien lenders (A) accelerates any of the Company's obligations under the Indenture or the second lien credit facility or (B) enforces any rights to collect payment under their respective agreements with the Company. Approximately 95% of the Company's outstanding second lien debt is held by an affiliate of MidOcean Partners. MidOcean Partners, through various investment funds that it manages, is the indirect, majority stockholder of the Company. The Company received a "Notice of Default", dated December 28, 2010, from AFII US BD Holdings, L.P., a holder of a majority of the Company's senior notes, contending that the Company's incurrence of its second lien credit facility in March 2009 violated certain provisions of the Senior Notes Indenture, dated as of January 31, 2007, among the Company, the guarantors named therein and The Bank of New York, as Trustee, pursuant to which the Company's senior notes were issued in January 2007. The Indenture Notice states that it is not a notice of acceleration. The Company continues to believe that its entry into the second lien credit facility in March 2009, the proceeds of which were used to pay down outstanding indebtedness under the First Lien Credit Agreement, was permitted by the Indenture. About Sbarro Inc. Melville, N.Y.-based Sbarro, Inc. -- http://www.sbarro.com/-- is the world's leading Italian quick service restaurant concept and the largest shopping mall-focused restaurant concept in the world. The Company has 1,056 restaurants in 41 countries. The Company's balance sheet at Sept. 30, 2010, showed $455.55 million in total assets, $29.98 million in total current liabilities, $7.47 million in deferred rent, $70.64 million in deferred tax liabilities, $13.26 million in due to former shareholders and other liabilities, $341.80 million in long-term debt, and stockholder's equity of $16.17 million. * * * Standard & Poor's Ratings Services in January 2011 lowered its corporate credit rating on Sbarro to 'CC' from 'CCC-'. The outlook is negative. "The ratings on Sbarro reflect S&P's belief that the company's current capital structure is unsustainable and that it is unable to service its existing debt," said Standard & Poor's credit analyst Mariola Borysiak. Sbarro has engaged Rothschild Inc. as its financial advisor to explore strategic alternatives addressing its current capital structure. SEQUENOM INC: Court Grants Motion to Strike in "Hawran" Suit ------------------------------------------------------------ In the lawsuit filed by Paul Hawran in the Superior Court of California for the County of San Diego, Hawran v. Hixson et al, case no. 37-2010-00058632-CU-DF-NC, on January 5, 2011, Sequenom, Inc. received the Court's order granting in part the Company's and the individual defendants' motion to strike the complaint under California Code of Civil Procedure Section 425.16. The Court removed from the lawsuit Mr. Hawran's claims of negligent and intentional misrepresentation and negligent and intentional interference with prospective economic advantage as to the Company and the individual defendants and Mr. Hawran's claim of breach of contract as to the individual defendants. Mr. Hawran's claim of breach of contract as to the Company and his claims for defamation, invasion of privacy and unfair business practices under California Business and Professions Code Section 17200 as to the Company and the individual defendants remain in the lawsuit. The Court also denied the Company's and the individual defendants' demurrer. The Company and the individual defendants intend to vigorously defend ourselves against the remaining claims. About Sequenom Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a life sciences company committed to improving healthcare through revolutionary genetic analysis solutions. Sequenom develops innovative technology, products and diagnostic tests that target and serve discovery and clinical research, and molecular diagnostics markets. The company was founded in 1994 and is headquartered in San Diego, California. The Company's balance sheet at Sept. 30, 2010, showed $96.97 million in total assets, $64.67 million in total current liabilities, $360,000 in deferred revenue, $2.86 million in other long-term liabilities, $1.12 million in long-term portion of debt and obligations, and stockholders' equity of $27.96 million. * * * In its March 15, 2010 audit report, Ernst & Young LLP of San Diego, California, expressed substantial doubt against Sequenom's ability as a going concern. The auditor noted that the Company has incurred recurring operating losses and does not have sufficient working capital to fund operations through 2010. SOUTHWEST RESTAURANT: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Southwest Restaurant Systems, Inc. 10426 E Jomax Rd. Scottsdale, AZ 85262 Bankruptcy Case No.: 11-00775 Chapter 11 Petition Date: January 11, 2011 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtor's Counsel: Irena Juras, Esq. JURAS LAW FIRM, PLC 7150 E Camelback Rd., Suite 444 Scottsdale, AZ 85251 Tel: (480) 425-2009 Fax: (480) 452-1640 E-mail: irena@juraslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Harvey R. McElhanon, president. SYNTERRA 3020: Files for Ch. 11 Due to Debt Woes ------------------------------------------------ Synterra 3020 Market, L.P., filed for Chapter 11 protection (Bankr. E.D. Pa. Case No. 11-10205) in Philadelphia, Pennsylvania, on Jan. 12, 2011. According to the corporate resolution authorizing the filing for the Chapter 11 petition, "Synterra 3020, a Pennsylvania limited partnership, is unable to pay its debts as they mature, and it is necessary for the Partnership to reorganize and that it is advisable to proceed under the acts of Congress relating to bankruptcy." The Debtor has not filed customary "first day" motions. The Debtor estimated assets and debts at $10 million to $50 million in its Chapter 11 petition. Albert A. Ciardi, III, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., in Philadelphia, represent the Debtor. William L. Wilson, manager of Synterra 3020 Market LLC, the sole general partner of the Debtor, signed the petition. SYNTERRA 3020: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Synterra 3020 Market, L.P. 3020 Market Street Phladelphia, PA 19104 Bankruptcy Case No.: 11-10205 Chapter 11 Petition Date: January 12, 2011 Court: U.S. Bankruptcy Court Eastern District of Pennsylvania (Philadelphia) Judge: Jean K. FitzSimon Debtor's Counsel: Albert A. Ciardi, III, Esq. Thomas Daniel Bielli, Esq. CIARDI CIARDI & ASTIN, P.C. One Commerce Square 2005 Market Street, Suite 1930 Philadelphia, PA 19103 Tel: (215) 557-3550 Fax: (215) 557-3551 E-mail: aciardi@ciardilaw.com tbielli@ciardilaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by William L. Wilson, manager. Debtor's List of 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ PECO -- $40,520 P.O. Box 37632 Payment Processing Philadelphia, PA 19101 Veolia STEAM -- $20,784 P.O. Box 681032 WI 53368-1032 CB Richard Ellis -- $16,313 Dept. 8844 Los Angeles, CA 90084-8844 Hunt's Janitorial Services -- $12,036 Securitas -- $11,600 Water Revenue Bureau -- $3,451 Site Stuff AR Inc. -- $3,446 Majek Fire Protection -- $1,650 Klenzoid -- $1,115 Brother Mike's -- $1,025 Allied Waste Services -- $638 Verizon -- $374 National Elevator Inspection -- $300 Services Abstract Overhead Door Co. Inc. -- $188 J.C. Ehrlich Co., Inc. -- $104 Battery Solutions -- $54 Deer Park -- $54 Verizon Wireless -- $29 West Philadelphia Locksmith -- $16 TAPATIO SPRINGS DEV'T: Secured Creditors Want Case Dismissed ------------------------------------------------------------ Clyde B. Smith and Peggy Smith, secured creditors in Tapatio Springs Development Company, Inc., have asked the U.S. Bankruptcy Court for the Western District of Texas to dismiss the Debtor's Chapter 11 bankruptcy cases. The Smiths say that the Debtor has little or no ability to provide adequate protection, that there is little to no equity in the Collateral and that the Collateral is not necessary for an effective reorganization. The Debtor is indebted to the Smiths under a Deed of Trust dated March 1, 1993, securing a Real Estate Lien Note in the original amount of $5,204,494.28 payable to Tapatio Springs, Inc., by Tapatio Springs Development Company, Inc. Subsequently, Tapatio Springs, Inc., dissolved and its assets, including the Note and the liens securing it, were distributed to Clyde B. Smith. The Note was extended on August 1, 2005, and modified, in part, adding Peggy Smith as a Lender and setting the interest rate at 6% per annum. The Note was again modified and extended on February 22, 2008, and further extended on June 17, 2009 to September 1, 2009, when the unpaid principal and interest totaled $3,226,637.55. No payments have been made against the Note, as amended and extended, since March 2010. The note has matured and due and payable in full. As of January 3, 2011, the accrued principal and interest due on the Note is $3,404,855.31 (accrued interest is $146,923.57; annual interest is $193,598.25; monthly interest is approximately $16,133.19; per diem interest is $530.41). The Smiths say that they have performed all obligations required of them. The Debtor has defaulted in its obligations to the Smiths and the Note is in default. The Debtor's debt to the Smiths is entirely secured in the Collateral. On January 4, 2011, the Smiths were prepared to foreclose on the Collateral through non-judicial foreclosure in Kendall County, Texas. The foreclosure was prevented by Debtor's filing for bankruptcy. Contemporaneously with this case, a companion case, Case No. 11- 50054 RBK, In re: Tapatio Springs Real Estate Holdings, LP., was filed, which purports to be an affiliated company. The Debtor and Holding Company filed essentially mirror image schedules and statement of financial affairs, including listing the subject property as an asset of the second bankruptcy estate; however, neither the Note nor Deed of Trust reflect any obligation or interest of the Holding Company. Since the property was also listed as an asset of Holding Company, and to avoid further delay, the Smiths re seeking relief in both causes. In both proceedings, the Debtor has indicated that the sole purpose for filing for bankruptcy protection was to stay the Smiths' foreclosure action scheduled for January 4, 2011. According to the Smiths, these proceedings were filed solely to hinder of delay the foreclosure and there is no reasonable likelihood of a reorganization of this non-income generating single piece of real estate. The Smiths want to foreclose on the Collateral and, in the alternative, declare that this case represents a single asset real estate petition and require the Debtor file a Plan within 30 days upon penalty of the stay being lifted to allow the Smiths to foreclose at that time. The Smiths are represented by Thomas W. McKenzie -- tmckenzie@tsslawyers.com -- at Davis, Cedillo & Mendoza, Inc. About Tapatio Springs Development Boerne, Texas-based Tapatio Springs Development Company, Inc., filed for Chapter 11 bankruptcy protection on January 3, 2011 (Bankr. W.D. Tex. Case No. 11-50050). Christopher J. Weber, Esq., at Christopher J. Weber, LLC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. THORNBURG MORTGAGE: Judge Cuts Executives' Bid for Defense Costs ---------------------------------------------------------------- Bankruptcy Law360 reports that a bankruptcy judge has trimmed two former TMST Inc. executives' bid to recover defense costs for Patton Boggs LLP's work defending them in an adversary case, slashing the amount they can receive from the company's insurer by $48,000. About Thornburg Mortgage Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA) -- http://www.thornburgmortgage.com/-- was a single-family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable rate mortgages. It originated, acquired, and retained investments in adjustable and variable rate mortgage assets. Its ARM assets comprised of purchased ARM assets and ARM loans, including traditional ARM assets and hybrid ARM assets. Thornburg Mortgage and its four affiliates filed for Chapter 11 on May 1, 2009 (Bankr. D. Md. Lead Case No. 09-17787). Thornburg changed its name to TMST, Inc. Judge Duncan W. Keir is handling the case. David E. Rice, Esq., at Venable LLP, in Baltimore, Maryland, is tapped as counsel. Orrick, Herrington & Sutcliffe LLP is employed as special counsel. Jim Murray, and David Hilty, at Houlihan Lokey Howard & Zukin Capital, Inc., are tapped as investment banker and financial advisor. Protiviti Inc. is also engaged for financial advisory services. KPMG LLP is the tax consultant. Epiq Systems, Inc., is claims and noticing agent. Thornburg listed total assets of $24.4 billion and total debts of $24.7 billion, as of January 31, 2009. On October 28, 2009, the Court approved the appointment of Joel I. Sher as the Chapter 11 Trustee for the Company, TMST Acquisition Subsidiary, Inc., TMST Home Loans, Inc., and TMST Hedging Strategies, Inc. TJ'S TREES: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: TJ's Trees & More Ltd., LLP P.O. Box 822933 NRH, TX 76182-933 Bankruptcy Case No.: 11-40302 Chapter 11 Petition Date: January 12, 2011 Court: U.S. Bankruptcy Court Northern District of Texas (Ft. Worth) Judge: D. Michael Lynn Debtor's Counsel: Richard G. Grant, Esq. RICHARD G. GRANT, PC 1304 John McCain Road Colleyville, TX 76034 Tel: (214) 210-2929 Fax: (214) 224-0198 E-mail: rgrant@rgglaw.com Estimated Assets: $50,001 to $100,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txnb11-40302.pdf UNIGENE LABORATORIES: Provides 2011 Business Outlook ---------------------------------------------------- Unigene Laboratories, Inc. provided a business outlook for 2011, highlighting multiple opportunities within its highly focused business units, Unigene Biotechnologies and Unigene Therapeutics, and reiterated its commitment to executing upon its strategic intent: * Increase cash runway in the near-term by prudent cash conservancy and incremental revenue generation; * As resources permit, retire debt and selectively invest in\ advancement of existing core development programs and technologies; and * Maximize shareholder value by exploiting the full potential of the Company's PeptelligenceTM platform. Ashleigh Palmer, CEO, Unigene Laboratories, Inc., stated "2010 was a year of transition for Unigene. We have entered 2011 with a compelling new strategy that will enable multiple shots on goal, and we now have a world class management team prepared to deliver results." Palmer continued, "We believe 2011 will be a transformational year for the new Unigene. Our mission remains nothing less than for Unigene to be recognized as a peptide powerhouse and the partner of choice for the co-development of therapeutic peptides. We are poised to realize multiple near-term initiatives to extend our cash runway, establish a viable portfolio of longer-term opportunities and strengthen our strategic and financial position to ensure corporate success." Unigene Biotechnologies Outlook The Company is expanding and exploiting its industry-leading Peptelligence(TM) platform of peptide oral drug delivery and manufacturing assets, expertise and capabilities to establish a robust high-value portfolio of partnered opportunities. A solid execution of the Company's planned awareness campaign and focused business development activity should generate near-term revenue from feasibility studies and service fees and establish a solid foundation for potential high-value milestone payments and royalties to ensure long-term success and maximize shareholder value. Unigene has already received strong validation of its recombinant manufacturing technology by way of the Company's out-licensing of a process to manufacture the active pharmaceutical ingredient in Novartis' development-stage oral calcitonin product currently in Phase 3 clinical trials for osteoarthritis and osteoporosis. Palmer, commented, "I am convinced that Unigene has the potential to be at the forefront of creating tailored solutions for current and future partners. Our goal is to become a "technology venture capitalist." We will invest our Peptelligence platform, which represents a distinctive set of capabilities, know-how and proprietary technologies, into as many therapeutic peptide programs as possible and help our partners co-develop those peptides through advanced clinical testing and commercialization." Unigene Therapeutics Outlook Unigene will continue to advance its own pipeline of novel, proprietary peptide development programs focused on metabolic disease and inflammation. The Company also expects to report several important milestones with its late-stage development programs throughout 2011. As previously reported, in 2009, Unigene licensed its late-stage oral calcitonin formulation to Tarsa Therapeutics, a venture financed company founded exclusively to conduct Phase 3 clinical testing and prepare Unigene's proprietary oral calcitonin formulation for commercialization. Unigene owns a 25% stake in Tarsa. During the third quarter of 2010, Tarsa announced it had completed patient enrollment for its multinational, randomized, double-blind, placebo-controlled Phase 3 ORACAL trial in postmenopausal women with osteoporosis and that an independent Data Monitoring Committee had conducted two separate safety reviews of patient data and recommended the trial proceed as planned. The Company along with Tarsa expects to announce the completion of the Phase 3 study top-line results in the second quarter of 2011 and registration filings with the U.S. Food and Drug Administration (FDA) and European Medicines Agency (EMA) in the second half of 2011. In December 2010, the Company entered into an amended and restated exclusive worldwide license agreement with GSK to develop and commercialize an oral formulation of a recombinantly produced parathyroid hormone (PTH) analog for the treatment of osteoporosis in postmenopausal women. Under the terms of the amended and restated agreement, Unigene will conduct the Phase 2 study and will be eligible to receive the remaining milestone payments of up to $142M including an upfront payment of $4M, an additional $4M milestone payment upon completion of Phase 2 patient enrollment and further payments based upon the achievement of regulatory and commercialization milestones. In addition, Unigene is eligible to receive tiered low double-digit royalties on global sales. Once the Phase 2 study has been completed, and based on a review of the data, GSK may elect to assume responsibility for all future development and commercialization of the product. The GSK agreement provides a clear path forward for the PTH program. Unigene is on track to initiate the Phase 2 oral PTH study and commence patient enrollment in the first quarter of 2011. This multicenter, double blind, randomized, repeat dose placebo controlled study will include an open label comparator arm and will evaluate approximately 90 postmenopausal osteoporotic women for a period of 24 weeks. The primary endpoint will be an increase in bone mineral density in subjects at 24 weeks compared to baseline. Patient enrollment for this study is expected to be completed in the first half of 2011 with top-line results expected by year end. Unigene's satiety program remains a priority and continues in advanced pre-clinical development. The Company is exploring multiple partnering opportunities for its satiety analogs both for companion animal obesity and human clinical development along with its preclinical anti-inflammatory peptides. Palmer continued, "Unigene's platform technologies have earned, and are now beginning to enjoy the benefits and rewards of, extensive clinical and partner validation. The Company's Peptelligence platform encapsulates medically important and commercially relevant competitive advantages including our superior oral drug delivery technology, our commercial scale recombinant peptide manufacturing technology, our FDA approved API production facility, our proprietary formulation know-how, and our clinical development and regulatory expertise and proven track record. We anticipate meaningful news flow relating to our established partners' late-stage programs during the course of 2011, which should not only further validate our Peptelligence platform but contribute potential additional milestone payments to the bottom line. With our 2011 goals accomplished, we should be in a position to begin retiring debt and strengthen our financial position." Palmer concluded, "Today, we reiterate our commitment to our strategy and believe we are well positioned to deliver results over the course of the year to ensure that 2011 is truly transformational for Unigene." About Unigene Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/ -- is a biopharmaceutical company focusing on the oral and nasal delivery of large-market peptide drugs. The Company's balance sheet at Sept. 30, 2010, showed $25.66 million in total assets, $62.50 million in total liabilities, and a stockholders' deficit of $36.83 million. Grant Thornton LLP, in New York, expressed substantial doubt about Unigene Laboratories' ability to continue as a going concern following the Company's 2009 results. The firm noted that the Company has incurred a net loss of $13,400,000 during the year ended December 31, 2009 and has an accumulated deficit of approximately $143,000,000 as of December 31, 2009. As of that date, the Company's current liabilities exceeded its current assets by $1,251,000 and its total liabilities exceeded total assets by $30,442,000. UNISYS CORP: Joseph Harrosh Discloses 6.6% Equity Stake ------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on January 10, 2011, Joseph L. Harrosh discloses that he beneficially owns 2,826,112 shares of common stock of Unisys Corporation representing 6.6302% of the shares outstanding. As of September 30, 2010, there were 42,624,836 shares of the Company common stock outstanding. About Unisys Corp. Based in Blue Bell, Pennsylvania, Unisys Corporation (NYSE: UIS) -- http://www.unisys.com/-- provides a portfolio of IT services, software, and technology that solves critical problems for clients. With more than 26,000 employees, Unisys serves commercial organizations and government agencies throughout the world. The Company's balance sheet for Sept. 30, 2010, showed $2.840 billion in total assets; total current liabilities of $1.256 billion, long-term debt of $836.7 million, long-term postretirement liabilities of $1.498 billion, long-term deferred revenue of $143.5 million, and other long-term liabilities of $139.2 million; and a stockholders' deficit of $1.0345 billion. UNITED FOOTBALL: Faces Suit for Nonpayment of $5 Million Loan ------------------------------------------------------------- The Associated Press reports that Mark Cuban, the owner of the Dallas Mavericks basketball team in the National Basketball Association, filed a lawsuit in federal court on Monday against the United Football League claiming the league has failed to repay $5 million he loaned it last year. The suit says the UFL missed the initial deadline for repayment in October and another on December 1. According to the AP, the suit names as defendants league co-founder William Hambrecht and his revocable trust, which guaranteed the loan. Calls to the league's legal and public relations offices by The Associated Press Thursday weren't immediately returned. Mr. Cuban declined additional comment when contacted by the AP. The AP notes the five-team league completed its second season in November. URS CORPORATION: Moody's Cuts Rating on Bank Facility to 'Ba1' -------------------------------------------------------------- Moody's Investors Service lowered URS Corporation's bank facility rating to Ba1 from Baa3 to reflect the release of asset security from the collateral package, which effectively renders the facility as unsecured. URS' Ba1 corporate family, Ba1 probability of default, and SGL-1 speculative grade liquidity ratings were affirmed and the company's ratings outlook remains positive. This concludes the review for possible downgrade on the bank facility rating initiated December 9, 2010. URS' Ba1 corporate family rating considers its strong market position as one of the largest, fully integrated providers of engineering, procurement and construction services to an assortment of end markets, mainly within the United States. While some of these end markets are highly cyclical, about 50% of URS' revenue is derived from the Federal Government Sector for services such as managing, operating and maintaining various facilities and projects, and this revenue source tends to be relatively stable. Near term results should benefit from URS' significant backlog level, improving economic conditions, and project execution that has been favorable. Key credit metrics, including Debt/ EBITDA of 2.5x and FFO/ Debt of 34% are at levels of strength for its rating, although some of this capacity may be absorbed by future acquisition activity. Margin pressure could also develop, in Moody's opinion, driven by greater levels of competition arising through the recent downturn or performance issues related to the industry trend towards increasing percentage of fixed-price contracts. Longer term, Government budget constraints could also weigh on URS' results. For its rating to be moved higher, Moody's needs to gain further confidence that URS will maintain a disciplined approach to financing any future growth initiatives, including acquisitions, such that it could quickly restore its adjusted Debt/ EBITDA below 2.75x and Funds from Operations ("FFO")/ Debt above 30%, should its ratios stretch beyond these boundaries. While not currently expected, negative rating pressure could develop in the event of significant margin compression from project performance issues or if URS were to pursue a large debt-financed acquisition. Metrics associated with downward rating action would include sustained Debt/ EBITDA above 3.25x and FFO/ Debt below 20%. Moody's last rating action on URS was on December 9, 2010, when Moody's affirmed the Ba1 corporate family and probability of default ratings, changed the ratings outlook to positive from stable, and placed the bank facility rating under review for possible downgrade. The principal methodology used in this rating was Moody's Global Construction Industry rating methodology published in November 2010. URS Corporation, headquartered in San Francisco, California, is a leading engineering and construction firm and a major federal government contractor that provides a range of professional planning, design, engineering, construction, operations and maintenance, and decommissioning and closure services. Consolidated revenues for the trailing twelve months to October 1, 2010, were approximately $8.9 billion. UTSTARCOM INC: To Change Place of Incorporation to Cayman Islands ----------------------------------------------------------------- UTStarcom, Inc. announced a proposed reorganization to change its place of incorporation from Delaware to the Cayman Islands. The reorganization is expected to involve the Company's merger with a newly formed subsidiary, as a result of which the Company will become a wholly owned subsidiary of a Cayman Islands holding company. It is expected that each outstanding share of common stock of the Company will be converted into the right to receive one ordinary share of UTStarcom Cayman, which will be issued by UTStarcom Cayman in connection with the merger pursuant to a registered offering. Following the merger, UTStarcom Cayman, together with its subsidiaries, is expected to own and continue to conduct UTStarcom's business in substantially the same manner as is currently being conducted by UTStarcom and its subsidiaries. While UTStarcom Cayman will be taxed as a United States corporation, it is expected to qualify as a foreign private issuer for purposes of its reporting obligations with the SEC, which the Company expects will reduce its compliance operating costs. The shares of UTStarcom Cayman are expected to be listed on the NASDAQ Stock Market. The merger requires the affirmative vote of a majority of the Company's outstanding common stock. Notice of the special meeting and a proxy statement/prospectus describing the reorganization will be mailed to UTStarcom's stockholders of record on the record date selected by the Board of Directors. The record date and special meeting are expected to occur during the first half of 2011. About UTStarcom, Inc. UTStarcom, Inc. (Nasdaq: UTSI) -- http://www.utstar.com/-- is a global leader in IP-based, end-to-end networking solutions and international service and support. The Company sells its solutions to operators in both emerging and established telecommunications markets around the world. UTStarcom enables its customers to rapidly deploy revenue-generating access services using their existing infrastructure, while providing a migration path to cost-efficient, end-to-end IP networks. The Company's headquarters are currently in Alameda, California, with its research and design operations primarily in China. The Company's balance sheet at Sept. 30, 2010, showed $810.98 million in total assets, $557.68 million in total liabilities, and stockholders' equity of $253.31 million. * * * In its Form 10-K, the Company noted that it has recorded operating losses in 19 of the 20 consecutive quarters in the period ended December 31, 2009. At December 31, 2009, the Company had an accumulated deficit of $1.067 billion. While operating results are expected to improve in 2010 compared with prior years, management expects the Company to continue to incur losses in 2010. VERSO PAPER: S&P Puts 'B' Rating on $360-Mil. 2nd Lien Notes ------------------------------------------------------------ Standard & Poor's Ratings Services assigned issue-level and recovery ratings to Memphis, Tenn.-based Verso Paper Holdings LLC's proposed $360 million second priority senior secured notes due 2019. The issue rating on the notes is 'B' (the same as the corporate credit rating). The recovery rating is '3', which indicates S&P's expectation for meaningful (50% to 70%) recovery of principal in the event of payment default. The notes are expected to be sold pursuant to Rule 144A under the Securities Act of 1933. The Company intends to use net proceeds from the proposed new second priority senior secured notes to pay the consideration for its announced cash tender offer for its existing $337 million 9.125% second priority senior secured fixed rate notes due 2014, to redeem any remaining second-lien notes, following the expiration of the cash tender offer, and to pay for certain related transaction costs and expenses. The 'B' corporate credit rating on Verso Paper Holdings LLC reflects Standard & Poor's Ratings Services' view of the combination of the Company's highly leveraged financial risk profile and weak business risk profile. Specifically, S&P's ratings incorporate the Company's limited product diversity, substitution risks due to changing customer preferences for greater electronic content, and vulnerability to fluctuations in input costs and selling prices. In addition, S&P expects the Company will maintain adequate liquidity despite adjusted leverage likely exceeding 6x throughout 2011, which S&P thinks is attributed to its relatively good cash position and lack of meaningful debt maturities until 2013. Verso's core business is as a producer of coated freesheet, coated groundwood, and uncoated supercalendered papers serving customers in the catalog, magazine, inserts, and commercial-print markets. A substantial proportion of its sales are to catalogs and magazines end users, which S&P believe are susceptible to substitution risks due to changing customer preferences for greater electronic content. Ratings List Verso Paper Holdings LLC Corporate credit rating B/Stable/-- New Rating $360 mil 2nd priority Sr Secd. Nts due 2019 B Recovery rating 3 VITRO SAB: Mexican Reorganization Faulted on Insider Vote --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, says that Vitro SAB had its Mexican reorganization proceedings dismissed because the Company was relying on the use of $1.9 billion of intercompany debt to vote in favor of the restructuring. A judge in Mexico said the use of intercompany debt to obtain a creditor majority "would result completely contrary" to the intent of Mexico's bankruptcy law, according to a Federal Judicial Counsel statement. Leaders among the holders of $1.2 billion in defaulted bonds are willing to negotiate now with Vitro, Bloomberg News' Thomas Black reported. Bondholders claim Vitro is worth enough to pay them in full. Bondholders have been opposing the reorganization because it depended on voting $1.9 billion of intercompany claims in favor of the plan. Vitro previously said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt and convertible bonds. 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. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and is now seeking to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. The offer was to expire December 7. Noteholders who oppose the exchange, namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. -- which hold US$75 million, or approximately 6% of the outstanding bond debt -- commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and nine other affiliates on November 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation Counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10-47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). Vitro SAB on December 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, thereby commencing its voluntary concurso mercantil proceedings. Vitro SAB believes that, as a result of the implementation of the Concurso Plan through the Mexican Proceeding, the holders of the Restructured Debt will recover 68% to 75% of the face value of their respective claims. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on December 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Alejandro Francisco Sanchez-Mujica, as foreign representative of Vitro, has asked the U.S. Bankruptcy Court to enter an order recognizing the Mexican Proceeding as "foreign main proceeding" pursuant to 11 U.S.C. Secs. 1515 and 1517. WINDSOR LAKE: Organizational Meeting Moved to Jan. 14 ----------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on January 14, 2011, at 2:00 p.m. in the bankruptcy case of Windsor Lake Estate, LLC. The meeting will be held at the United States Trustee's Office, One Newark Center, 21st Floor, Room 2106, Newark, NJ 07102. As reported by the Troubled Company Reporter on January 7, 2011, the meeting was initially set for January 12, 2011, at 1:00 p.m. The U.S. Trustee adjourned the meeting due to a pending snow storm. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Sparta, New Jersey-based Windsor Lake Estates, L.L.C. -- aka Ashdown Forest Estates, LLC; Fox Chase at Sparta, L.L.C.; and The Estates at Fox Hollow Lake -- filed for Chapter 11 bankruptcy protection on December 21, 2010 (Bankr. D. N.J. Case No. 10- 49341). Richard D. Trenk, Esq., at Trenk, Dipasquale, Webster, Et Al, serves as the Debtor's bankruptcy counsel. According to its schedules, the Debtor disclosed $93,116 in total assets and $4,918,129 in total debts as of the Petition Date. WINDSOR QUALITY: S&P Holds 'B+' Credit Rating; Outlook Stable ------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating on Houston, Tex.-based Windsor Quality Food Co. Ltd. The rating outlook is stable. "At the same time, S&P assigned a 'BB-' issue-level rating (one notch higher than the corporate credit rating) to Windsor Quality Food's proposed $450 million senior secured credit facilities," said Standard & Poor's credit analyst Rick Joy. The recovery rating is '2', indicating S&P's expectation for substantial (70% to 90%) recovery in the event of a payment default. The Company intends to use debt proceeds to fund the acquisition of Discovery Foods, pay fees and expenses and refinance existing indebtedness. Issue-level ratings are based upon preliminary documentation and are subject to review upon final documentation. S&P will withdraw S&P's 'B+' issue-level rating on the Company's existing $119 million term loan upon completion of the transaction, and repayment of this existing loan. WN TRUCK STOP: Bankr. Court Says Plan Not Feasible -------------------------------------------------- Bankruptcy Judge Harlin DeWayne Hale denied confirmation of the Modified First Amended Plan of Reorganization filed by WN Truck Stop, LLC, on September 24, 2010, finding that the pre- and post- petition operations and projections indicate that the Plan is not feasible. Judge Hale held that the Debtor's "operations alone do not support repayment of the Debtor's obligations. The Debtor simply could not overcome the hard facts of the present economy." Judge Hale also held that the proposed interest rate in the Debtor's Plan does not provide SBL Capital Funding, LLC, with the present value of its secured claim. SBL is a private direct lender sometimes called a "hard money lender" that specializes in short term real estate bridge loans to borrowers who are unable to access conventional financing due to creditworthiness and other high risk factors. SBL does not make long term conventional real estate loans. In fact, the terms of the loans that SBL makes are never more than 15 months in length. The SBL Note is due and payable in full, for a total amount outstanding on the Petition Date of $5,889,041.60, with interest continuing to accrue postpetition at a per diem of $2,750. As of December 10, 2010, the total amount of accrued postpetition interest that would be payable at the default contract rate is $524,875.00. The Debtor proposes a rate of interest under its Plan for SBL's Allowed Secured Claim of 6%. That rate, according to the Court's ruling, does not provide SBL with the present value of its Allowed Secured Claim as required by 11 U.S.C. Section 1129(b)(2)(A)(i). Because the Debtor has not and cannot propose a confirmable Plan in the case, SBL is entitled to relief from the stay as requested in SBL's Motion to Lift Stay, which was heard concurrently with confirmation of the Plan. A copy of the Court's January 10, 2011 Findings of Fact and Conclusions of Law is available at http://is.gd/taTxmYfrom Leagle.com. About WN Truck Stop Dallas, Texas-based WN Truck Stop, LLC, dba Willie's Place, filed for Chapter 11 bankruptcy (Bakr. N.D. Tex. Case No. 10-33156) on May 3, 2010. Robert A. Simon, Esq., at Barlow Garsek & Simon, LLP, in Fort Worth, Texas, represents the Debtor as counsel. In its petition, the Debtor estimated $1 million to $10 million in assets and debts. WORKFLOW MANAGEMENT: Unsecured Creditors Not on Board With Plan --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports Workflow Management Inc. resolved some although not all objections when it filed a revised reorganization plan at the end of December. A hearing to consider approval of the disclosure statement explaining the revised plan was scheduled for Jan. 13. According to Mr. Rochelle, the official committee representing unsecured creditors is against the plan. It said it unfairly discriminates against unsecured creditors and can't be confirmed. Mr. Rochelle adds that Credit Suisse AG, Cayman Islands Branch, as agent for the first lien lenders, filed an objection, saying that not enough first-lien lenders are officially on board to assure that the plan will command an affirmative vote of the top-tier secured class. Credit Suisse explained how holders of 36% of the first-lien debt recently reached an agreement in principle on the basic economic terms of the revised plan. Still, the minority hadn't agreed on all details of the plan, including issues about post-emergence interest. The agent says that the minority, if they all vote against the plan, could require Workflow to use the so-called cramdown process for confirmation. The Pension Benefit Guaranty Corp., according to Mr. Rochelle, also objected to the Disclosure Statement, saying it didn't tell creditors about the PBGC's $55.5 million claim. Workflow listed a $32 million claim for termination of the existing pension plans. The Revised Plan Michael Bathon at Bloomberg News reported that at the end of 2010, Workflow Management filed a new plan to reorganize by selling its assets to a company set up by one of its lenders. Workflow reached an agreement with Silver Point Finance LLC after a bankruptcy judge in Norfolk, Virginia, preliminarily denied the lender's request to terminate Workflow's control over the case. The Plan would allow Workflow to reduce debt by more than $170 million. Workflow would eliminate more than $50 million in secured debt, more than $95 million in unsecured holding company debt, and more than $76 million in non-holding company unsecured debt. Under the new Plan, Workflow would sell virtually all of its assets to the newly formed company for new notes, plus cash to pay administrative costs and fund a trust for unsecured creditors. Second-priority lenders would get 58.5% of the equity. Perseus LLC, Workflow's current owner, would receive the remaining 41.5% for a $12.5 million capital infusion. Creditor recoveries would be: * Lenders with a first priority of repayment, owed about $141.5 million, would get $141.5 million in new notes with the same security on the buyer's assets. * Second-priority lenders owed about $196.5 million, which have Silver Point as agent, would be allowed a $170 million secured claim and a $26.5 million unsecured claim. They would get $140 million in new notes with the same security they currently hold, as well as preferred-equity interests valued at about $30 million. * Unsecured creditors would share a $1 million fund. About Workflow Management Headquartered in Dayton, Ohio Workflow Management, Inc., fka Workflow Graphics, Inc. -- http://www.workflowone.com/-- offers commercial printing services, including print buying and document management capabilities, through three divisions: WorkflowOne, Freedom Graphics Services, and United Envelope. It also distributes office products and promotional items through an online ordering system. Its customers include both small and large companies throughout North America in such sectors as financial services, health care, retail, and government. Workflow Management Inc., and its affiliates, filed for Chapter 11 bankruptcy protection on September 29, 2010 (Bankr. E.D. Va. Lead Case No. 10-74617). Cullen A. Drescher, Esq., Daniel F. Blanks, Esq., Douglas M. Foley, Esq., and Patrick L. Hayden, Esq., at McGuireWoods LLP; Sarah Beckett Boehm, Esq., at McGuireWoods LLP; and Rosa J. Evergreen, Esq., at Arnold & Porter LLP, assist the Debtors in their restructuring effort. Arnold & Porter LLP is the Debtors' special counsel. Kaufman & Canoles, P.C., is the Debtors' corporate counsel. FTI Consulting is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. Workflow Management estimated assets and debts at $100 million to $500 million as of the Chapter 11 filing. W.R. GRACE: Court Conditionally Approves CNA Settlement ------------------------------------------------------- Bankruptcy Judge Judith Fitzgerald has provisionally endorsed the settlement between W.R. Grace & Co. and CNA Financial Corp. and its affiliates during the Jan. 10 omnibus hearing, according to Peg Brickley of The Wall Street Journal. Judge Fitzgerald gave her approval of the settlement, which puts a stop to decades of litigation between the parties over a series of insurance policies, after Grace agreed to adjust the pact to reflect that it will not conflict with the Plan of Reorganization currently pending in its bankruptcy case, the report said. "I think that the settlement is in the best interests of the parties and this estate," Judge Fitzgerald said at the Jan. 10 hearing, the Journal noted. The settlement, before being presented in court for approval, met opposition from BNSF Railway Company and a group of claimants asserting claims arising from asbestos-related personal injury caused by Grace's former vermiculite mining operations in Libby, Montana. BNSF complained that the settlement improperly eliminates its rights as a Named Insured to policy proceeds to which the Debtors and their estates have no rights. BNSF also complained that the settlement seeks to extend the channeling injunction to the CNA Companies without meeting the requirements of Section 524(g) of the Bankruptcy Code. Moreover, BNSF noted that rights of contribution and apportionment of fault among co-defendants accorded by state law are threatened by the settlement. BNSF asserted that the settlement improperly eliminates its rights under the vendor endorsements contained in the Grace insurance policies. The Debtors, in response, argued that several of BNSF's objections address issues that the Debtors worked hard to resolve with BNSF during the confirmation process, and those resolutions, according to the Debtors, are embodied in Plan modifications already filed with the Court. The rest of BNSF's objections raise phantom issues that simply do not exist under the language of the settlement or applicable state law, the Debtors told the Court. The Libby Claimants complained that the settlement purports to take away from them insurance coverage in which they have vested rights under non-bankruptcy law and as to which they do not compete with any other creditors of the Debtors' estate. The Libby Claimants also asserted that any order approving the settlement must repair the deliberate ambiguity in the terms of the Section 524(g) injunction that the CNA Companies are entitled to receive under the settlement. The Debtors countered that the Libby Claimants' objection confuses two wholly distinct matters: (1) Plan confirmation and (2) the approval of the insurance settlement with the CNA Companies as reasonable. The Debtors told the Court that the confirmability of the Plan and satisfaction of Section 524(g) have been more than thoroughly briefed and presented to the Court, and the record is closed. The Debtors warned the Court not to be distracted by the Libby Claimants' belated attempt to use a settlement approval motion to re-argue positions that the Section 524(g) injunction is improper for settling insurers. The Debtors and the CNA Companies maintained that the settlement should be approved because it is a fair and reasonable compromise, reached after extensive negotiations well over a year between the parties, with active participation of the Court-appointed future claims representative and the Official Committee of Asbestos- related Personal Injury Claimants. David T. Austern, the Court-appointed legal representative for future asbestos personal injury claimants, and the PI Committee joined in and supported the Debtors' request for approval of the settlement. Judge Fitzgerald, according to the Journal, said Grace is entitled to settle with its insurers. However, the judge noted, nothing in the Chapter 11 plan will shield companies that are not linked directly to Grace from liability, the Journal related. Prior to filing their objection, the Debtors and the CNA Companies sought and obtained separate orders from the Court granting them leave to file replies and exceed the page limit for replies in order to adequately respond to the 53-page objection of the Libby Claimants and BNSF. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Proposes to Amend 2010 L/C Facility Agreement --------------------------------------------------------- W.R. Grace & Co. and its debtor affiliates seek authority from Judge Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware to amend their 2010 postpetition letter of credit facility to extend the facility's stated termination date from March 1, 2011, to March 1, 2012. The Court, in February last year, authorized the Debtors to enter into the Facility Agreement, which provides for a letter of credit facility in the amount of $100 million. The L/C Facility, according to Adam Paul, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, enables the Debtors to provide letters of credit to counterparties on an as-needed basis during the ordinary course of their business operations. The Debtors intend to maintain the L/C Facility until they emerge from Chapter 11, Mr. Paul says. The Debtors say they do not anticipate emerging from their Chapter 11 cases and entering into exit financing prior to March 1, 2011. They have, therefore, negotiated and agreed upon with Bank of America, N.A., an extension of the Stated Termination Date until March 1, 2012. The L/C Facility Amendment contemplates the Debtors paying an amendment fee of $250,000, which the Debtors believe is a fair and reasonable fee under the circumstances of their Chapter 11 cases, for extending the L/C Facility's term for another year. The L/C Facility Amendment also gives the Debtors the option to increase at any time prior to the Stated Termination Date the total facility from $100 million to $120 million in exchange for a total facility increase fee of 25 basis points times the entire $20 million increase. The option to increase the Total Facility will allow the Debtors greater flexibility in managing their business operations as efficiently and effectively as possible, says Mr. Paul. The collateral arrangements of the Facility Agreement will cover any increase in the Total Facility. All other terms and conditions of the Facility Agreement remain unchanged, including but not limited to the secured financing arrangements. However, the Agent and the L/C Issuers will extend the Stated Termination Date and grant the Debtors an option to increase the Total Facility from $100 million to $120 million only if the cash collateral security arrangements documented in the L/C Facility Order and the Facility Agreement continue to secure obligations under the Total Facility, and the Debtors pay the Amendment Fee and, if applicable, the Total Facility Increase Fee. The Debtors assure the Court that they have negotiated the L/C Facility Amendment with the Agent at arm's-length and in good faith. Entering into the L/C Facility Amendment is in the best interest of the Debtors' estates, because the Debtors need a letter of credit facility to conduct their daily business operations efficiently and effectively, Mr. Paul asserts. There are no commercially practical alternatives to having an L/C Facility, and were the Debtors to allow the L/C Facility to expire without it being renewed or replaced, their business operations could face considerable -- and entirely unnecessary -- disruption, he adds. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Proposes to Extend ART Credit Agreement --------------------------------------------------- W.R. Grace & Co. and its debtor affiliates seek the Bankruptcy Court's authority to amend the credit agreement between W.R. Grace & Co.-Conn. and Advanced Refining Technologies LLC to further extend the agreement's termination date to February 28, 2012. Since 2001, Grace and Chevron Products Company, a division of Chevron U.S.A. Inc., have held ART as a joint venture, with each party holding a 50% equity interest in the venture. Grace and Chevron Capital Corporation, an affiliate of Chevron USA, have entered into separate, substantially identical credit agreements with ART under which they each provide ART with a separate $15 million revolving line of credit. The Grace ART Credit Agreement expires on February 28, 2011. The ART Credit Agreements provide financing to ART for working capital requirements so that excess cash from ART's business operations can be used to pay dividends to Grace and Chevron and to fund ART growth without that cash having to be tied up to fund periodic working capital "spikes." In 2011 and thereafter, ART expects to continue experiencing those spikes in working capital requirements, and it therefore will continue to require the existing lines of credit, particularly if excess cash has been either distributed in dividends or used to further invest in the ART joint venture. For these reasons, Grace and Chevron Capital have determined that they should extend the ART Credit Agreements' expiration dates to February 28, 2012. In view of the nature of ART's business operations and working capital requirements, Grace and Chevron Capital have concluded that it is more cost-effective to continue the existing lines of credit than it would be for ART to hold excess cash in order to meet fluctuations in working capital requirements if and when they occur. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Wins Nod of Swiss Reinsurance Settlement ---------------------------------------------------- W.R. Grace & Co. and its debtor affiliates received approval from the U.S. Bankruptcy Court for the District of Delaware of a settlement agreement and mutual release they entered into with Swiss Reinsurance Company Limited and European Reinsurance Company of Zurich Limited, formerly known as European General Reinsurance Company of Zurich Limited. Swiss Re issued six policies of excess liability insurance that provide, or are alleged to provide, insurance coverage to Grace. The Subject Policies provide coverage of $11 million in the aggregate for products or completed operations. Grace has incurred and may incur in the future certain liabilities, expenses and losses arising out of asbestos-related claims, for which Grace seeks coverage under the Subject Policies. Disputes have arisen between Grace and Swiss Re regarding their rights and obligations under the Subject Policies with respect to coverage for asbestos-related claims. To resolve the disputes, the Debtors and Swiss Re entered into the Agreement. According to the Debtors, the Agreement confers these benefits to their estates: (a) The payment of Swiss Re to the Asbestos Personal Injury Trust of $6,750,000 within 30 days of the "trigger date" as defined in the Agreement. (b) The payment of the amount by Swiss Re without the need for litigation to enforce the assignment by Grace to the Trust of rights under the Subject Policies. (c) A compromise of defenses that Swiss Re might have with respect to coverage for any individual Asbestos PI Claim. The Agreement also includes a complete, mutual release of all claims under the Subject Policies and is structured as a sale of property pursuant to Section 363 of the Bankruptcy Code. The Agreement provides that if the Debtors' Plan of Reorganization is confirmed, the Trust, at its own expense, will enforce the Asbestos PI Channeling Injunction with respect to Asbestos PI Claims subject to the Asbestos PI Channeling Injunction that are asserted against Swiss Re under the Subject Policies, provided that the Trust's obligation in this respect is limited to expending a sum not to exceed the amount received by the Trust in settlement. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ZURICH ASSOCIATES: Brooklyn Property in Chapter 11 -------------------------------------------------- Floral Park, New York-based Zurich Associates, Ltd., filed for Chapter 11 protection on Jan. 10, 2011 (Bankr. E.D.N.Y. Case No. 11-40145), disclosing $5,455,574 in assets and $10,487,021 in debts. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Zurich Associates is the owner of 17 parcels of real property mostly in Brooklyn, New York. Zurich has secured debt totaling $5.7 million owed to several lenders. Harvey J. Cavayero, Esq., in Westbury, New York, represents the Debtor. * Healthcare Costs "Will Bankrupt" New Jersey, Governor Says ------------------------------------------------------------ Bloomberg News reports that the New Jersey Economic Development Authority slashed its tax-exempt school-related bond offering by more than half to $712.3 million about 20 minutes after New Jersey Gov. Chris Christie told a town-hall meeting in Paramus, on Tuesday that health care costs "will bankrupt" the state. Bloomberg says the authority also cut its taxable offering 51% to $119.9 million, with four-year bonds priced to yield 125 basis points, or 1.25% points, above a U.S. Treasury due in December 2015. The issue included $211.3 million in floating-rate notes. According to Bloomberg, Gov. Christie said health care spending "will bankrupt" the state unless it requires workers to pay more for medical coverage. Mr. Christie, 48, a first-term Republican, also said the state will spend $4.3 billion on health insurance this year, and that cost will rise 40% within four years. "It doesn't help to try and sell a $1 billion deal on the same day the governor is talking about the state going bankrupt due to health care costs," said Mike Pietronico, who oversees $360 million as chief executive officer of Miller Tabak Asset Management in New York, according to Bloomberg. "Mr. Christie made a rookie mistake," Mr. Pietronico said. "The market is very sensitive to the word `bankrupt.'" * PIMCO's Gross Expects Municipal Bankruptcies to Decrease ---------------------------------------------------------- Darrell Preston and Margaret Brennan at Bloomberg News, report that Bill Gross, who manages the world's biggest bond fund at Pacific Investment Management Co., clashed with Meredith Whitney, the banking analyst, when he said he doubted there would be many local-government bankruptcies. "Ultimately, municipal bankruptcies will be at a lower level," Mr. Gross said January 12 on Bloomberg Television's "InBusiness" program. "I don't subscribe to the theory that there will be lots of them." According to the report, Ms. Whitney, who correctly predicted Citigroup Inc.'s dividend cut in 2008, said on CNBC on January 12 that she expected accelerated "outflows" from the municipal-bond market as state finances deteriorate in the next six months. Last month she forecast 50 to 100 "significant" municipal-bond defaults this year totaling "hundreds of billions" of dollars. Bloomberg adds that JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon, speaking Jan. 11 at his company's annual health-care conference in San Francisco, also said he expects more U.S. municipalities to declare bankruptcy and urged caution when investing in the public-debt market. "There have been six or seven municipal bankruptcies already," Mr. Dimon said. "Unfortunately you will see more." Bloomberg News notes that cities including Detroit and Harrisburg, Pennsylvania, have raised the prospect of bankruptcy. Still, the number of filings has declined. Six entities sought Chapter 9 protection under the bankruptcy code in 2010, compared with 10 in 2009, according to data compiled by James Spiotto, head of the bankruptcy practice at Chapman & Cutler, a Chicago law firm. * Wilbur Ross's IAC Acquires Indian Auto-Interior Parts Biz. ------------------------------------------------------------ Mark Clothier at Bloomberg News reports that International Automotive Components Group, the auto-parts maker owned by billionaire Wilbur Ross, acquired the automotive assets of Multivac India Private Ltd., a supplier of interior parts, to add the largest automaker in India as a customer. Terms weren't disclosed. Bloomberg relates that IAC, which runs its North American and Asian operations from Dearborn, Michigan, took over assets of 12 insolvent suppliers in 2009, adding more than $100 million in sales. IAC said 2009 sales were about $3.2 billion. * Brown Rudnick Among Law360's Bankruptcy Group of the Year ----------------------------------------------------------- A landmark ruling in favor of tort claimants finding that Pfizer Inc. engineered subsidiary Quigley Co. Inc.'s bankruptcy to limit asbestos liability and a $450 million settlement for unsecured creditors in the LyondellBasell Industries NV case are among the victories that have earned Brown Rudnick LLP a spot among Law360's Bankruptcy Groups of 2010. * Venable LLP Elects Brent W. Procida, Esq., as New Partner ----------------------------------------------------------- Venable LLP announced that Brent W. Procida, Esq., has been elected partner. Mr. Procida is a member of Venable's Bankruptcy and Creditors' Rights practice group in its Baltimore office, focusing on bankruptcy, creditors' rights, and general litigation. Mr. Procida represents secured lenders, servicers, businesses and individuals in a wide variety of litigation at all levels of state and federal court. Mr. Procida's practice has focused on complex workouts and litigation on behalf of securitized mortgage trusts. Mr. Procida's diverse background practicing in both New York and Maryland allows him to draw on a wide range of experience in seeking to address the needs of each client. Mr. Procida is a frequent volunteer with the Maryland Volunteer Lawyers Service. He received his J.D. from Hofstra University School of Law in 1995, and his B.A. in Economics from the University of Notre Dame in 1992. An American Lawyer top 100 law firm, Venable LLP has attorneys practicing in all areas of corporate and business law, complex litigation, intellectual property and government affairs. Venable serves corporate, institutional, governmental, nonprofit and individual clients throughout the U.S. and around the world from its headquarters in Washington, D.C. and offices in California, Maryland, New York and Virginia. * BOOK REVIEW: Megamergers - Corporate America's Billion-Dollar Takeovers --------------------------------------------------------------- Author: Kenneth M. Davidson Publisher: Beard Books Hardcover: 427 pages Listprice: $34.95 Review by Henry Berry Megamergers are nothing new to the business world. One of the first occurred in 1901, when Carnegie Steel merged with several rival steel corporations, resulting in the billion-dollar United States Steel. Since then, megamergers have been a part of American business. However, the author notes that megamergers have historically "occurred sporadically and been understandable" on face value. By contrast, in recent decades there has been a "current wave of large mergers [that] is unprecedented." In Megamergers - Corporate America's Billion-Dollar Takeovers, Davidson looks at the unprecedented number of megamergers occurring today and considers whether this signals a change in the thinking of U.S. business leaders. Legislators, corporate executives, mergers specialists, and anyone else involved in, or affected by, megamergers will find this book enlightening. An announcement of a merger is usually accompanied with the pronouncements that it will result in greater synergies, operational efficiencies, and improved servicing of markets. Mr. Davidson questions whether this has, in fact, been the case. He analyzes the subsequent financial performance of the corporate behemoths produced by these megamergers and concludes that the majority of them were not justifiable nor, ultimately, productive. Mr. Davidson is an admitted skeptic about the value of mergers to the overall economy and to employees, stockholders, and consumers. He is critical of the overly optimistic rationales prevalent in today's business climate that lead many businesspersons into mergers. For the most part, though, he keeps his biases in check. He rejects many of the common criticisms of mergers. For example, he finds unpersuasive the argument that mergers should be rejected on the ground that they undermine market competitiveness. Nor, does he say, is it worthwhile to revisit the ongoing debate over whether "'risk arbitrageurs are good guys or bad guys." The author states that his "first intention [is] to paint a picture of what is happening [to] clarify the issues involved and areas of dispute." He offers a balanced examination of the megamerger phenomenon, particularly as it pertains to the energy and financial services industries. He goes beyond seeing megamergers only as phenomena of contemporary corporate culture, and his analyses go beyond mere statistics. Megamergers have their roots not only in business ambitions and current trends, but also in human nature. Recognizing this, the author also addresses the psychology underlying megamergers. As noted in the section "The Acquisition Imperative," mergers present a temptation to the decision-making executives of successful companies "look[ing] beyond their product and consider[ing] the disposal of excess profits." Mr. Davidson explains why a merger appears to many executives to be a better option than distributing profits to shareholders, starting new businesses, or investing in securities. The informed perspective Mr. Davidson offers in this book, first published in 2003, is just as relevant today. It is a book that brings new wisdom to old ways of thinking about megamergers. An attorney for the U. S. Federal Trade Commission for 25 years, Kenneth M. Davidson has also been a corporate attorney and a visiting law professor. ********* 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 by e-mail. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases by individuals and business entities estimating assets and debts or disclosing assets and liabilities at less than $1,000,000. The list includes links to freely downloadable images of the small-dollar business-related 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. Jhonas Dampog, 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 2011. 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 ***