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/raid1/www/Hosts/bankrupt/TCR_Public/110201.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, February 1, 2011, Vol. 15, No. 31 Headlines AIRTRAN HOLDINGS: Reports $1.92-Mil. Net Income for 4th Quarter AMERICAN DIAGNOSTIC: Files for Chapter 11 in Chicago AMERICAN DIAGNOSTIC: Case Summary & 20 Largest Unsecured Creditors AMERICANWEST BANCORP: U.S. Trustee Forms 3-Member Creditors Panel ANGIOTECH PHARMACEUTICALS: Files for Chapter 15 in Delaware ANGIOTECH PHARMACEUTICALS: Chapter 15 Case Summary ANGIOTECH PHARMACEUTICALS: CCAA Case Summary ANGIOTECH PHARMACEUTICALS: Moody's Cuts PDR to 'D' on CCAA Filing ARVINMERITOR INC: S&P Hikes Rating to 'B'; Outlook Stable BAKER'S KEYBOARD: Receives Offers for Club BEAR MOUNTAIN: Ex-NHL Player Won't Recoup Investment BEST STAY: Voluntary Chapter 11 Case Summary BLUEKNIGHT ENERGY: Swank Capital Disappointed With Proposed GTA CALYPTE BIOMEDICAL: Posts $10.49MM Net Income in Sept. 30 Qtr. CAMBRIDGE-LEE HOLDINGS: Unit Files Schedules of Assets and Debts CAMBRIDGE-LEE HOLDINGS: Wants Until March 7 to File Ch 11 Plan CAPITOL THEATRE: Windsor Seeks Partnership to Take Over Operations CARTER'S GROVE: Defaults Payment; Headed for February Auction CATALYST PAPER: Elk Falls Mill Liquidation Ongoing CATHOLIC CHURCH: Milwaukee Proposes Bear Realty as Broker CATHOLIC CHURCH: Milw. Wants RFP & Cassidy as Co-Listing Agents CATHOLIC CHURCH: U.S. Trustee Won't Oppose Milw. Hiring of Firms CELL THERAPEUTICS: Amends Form 8-K on $25MM Pref. Stock Deal CHIPOLA RIVER: Case Summary & 8 Largest Unsecured Creditors CHRYSLER GROUP: Posts $199MM Q4 Net Loss; In Talks With Banks CIRTRAN CORP: Extends Forbearance Agreement With YA Global CLOVERLEAF ENTERPRISES: Penn Nat'l Buys Rosecroft for $10.25MM CNL HOTELS: Said to Be Preparing Bankruptcy Filing CODA OCTOPUS: Has $2.9MM Loss in Fiscal 2010; 10-K Delayed CONNECTOR 2000: Ch. 9 Plan Confirmation Hearing Set for March 25 COTTON 303: U.S. Trustee Unable to Form Creditors Committee CRAFTMASTER PROPERTIES: Case Summary & Unsecured Creditor CUMULUS MEDIA: Wallace R. Weitz Discloses 5.3% Equity Stake DIGITILITI INC: CEO Taghizadeh Added to Board of Directors DILLARD'S INC: Moody's Affirms 'B2' Rating; Outlook Now Positive DIMENTSIONS BY DAN: Voluntary Chapter 11 Case Summary DISH NETWORK: Fitch Affirms 'BB-' Issuer Default Rating EASTLAND PLAZA: Case Summary & 2 Largest Unsecured Creditors ESCO CORP: S&P Withdraws 'B+' Credit Rating at Firm's Behest EURENERGY RESOURCES: Chapter 11 Case Transferred to Dallas EVANS OIL: Files for Chapter 11 in Ft. Myers, Florida EVANS OIL: Case Summary & 20 Largest Unsecured Creditors EVERGREEN SOLAR: Unveils Alterations to Debt-Exchange Offer FIN'L RESOURCES MORTGAGE: SEC Halts Ponzi Probe, Issues Orders FIRST FEDERAL: Bear State to Invest $55 Million FORD MOTOR: Reports $6.60 Billion Net Income in 2010 FORD MOTOR: Fitch Upgrades Issuer Default Rating to 'BB' FORD MOTOR: Moody's Affirms 'Ba2' Rating; Outlook Now Positive GENERAL EMPLOYMENT: Gets Add'l Deficiency Letter from NYSE Amex GENERAL MOTORS: Cancels Planned $14.4BB Loan From Dept. of Energy GEO GROUP: S&P Lowers Rating to 'B+' on More Debt for Acquisition GREAT ATLANTIC & PACIFIC: Pursues Adv. Proceeding vs. OfficeMax GREAT ATLANTIC & PACIFIC: Sues Landlords to Take Back Payments GREAT ATLANTIC & PACIFIC: Wants Until July 10 to Decide on Leases GREENBRIER COS: Deloitte Replaced by KPMG as Accountants GREENFIELD SCHOOL BOARD: Feb. 7 Meeting Set to Discuss Financials GVSW SURPRISE: Voluntary Chapter 11 Case Summary HILL TOP: Court Dismisses Amended Second Exclusivity Motion HILLSBOROUGH CORP: Case Summary & 11 Largest Unsecured Creditors HORIZON COLDWATER: Voluntary Chapter 11 Case Summary HUBBARD PROPERTIES: Files for Chapter 11 Bankruptcy Protection INNKEEPERS USA: U.S. Trustee Objects to Professionals' Fees INSIGHT HEALTH: Judge Gonzales Signs Plan Confirmation Order INTEGRAS PROPERTY: Case Summary & 4 Largest Unsecured Creditors INVETIV HEALTH: i3 Buyout Cues Moody's to Hold 'B2' Rating IRVINE SENSORS: 9 Investors Convert $246,400 of Notes JASON'S HAULING: Case Summary & 20 Largest Unsecured Creditors JAVO BEVERAGE: Gets Court's Interim Nod to Obtain DIP Financing JAVO BEVERAGE: Section 341(a) Meeting Scheduled for Feb. 23 JAVO BEVERAGE: Gets Court's Nod to Hire Kurtzman as Claims Agent JAVO BEVERAGE: Has Interim Nod to Sell Accounts Receivable JOHN KIEFFER: Files for Chapter 7 Bankruptcy Protection KC ESTATES: Voluntary Chapter 11 Case Summary KELLEY & FERRARO: Files Ch. 11 to Stay Co-Founder's Wife Suit KENTUCKIANA MEDICAL: Gets $200,000 Loan from Hall-Robb KRATON PERFORMANCE: Moody's Affirms 'B1' Corp. Family Rating KRATON POLYMERS: S&P Upgrades Corp. Credit Rating to 'BB-' KROME XPRESS: Case Summary & 15 Largest Unsecured Creditors LA UNIFIED SCHOOL DISTRICT: Facing $10-Bil. Healthcare Liability LANDMARK MEDICAL: Accelerates Sale Process to Preserve Jobs LARRY WILCOX: Escapes Jail Time for Penny Stock Scheme LEED CORPORATION: To Make Adequate Protection Payments to IMT LEHMAN BROTHERS: Files 4th Quarter Report on Claims Settlements LEHMAN BROTHERS: Merit Wants Plan Exclusivity Until June 15 LEHMAN BROTHERS: Proposes Settlement With Swedbank LIVEMERCIAL AVIATION: Case Converted to Ch. 7 Liquidation LODGENET INTERACTIVE: Mast Entities Hold 7.2% Equity Stake LOEHMANN'S HOLDING: Shuts Down Store at Huntington Beach LOUISVILLE ORCHESTRA: Has Funding to Pay Musicians MAJESTIC STAR: Hiring Fine Point as Casino Adviser MERIDIAN MORTGAGE I: Voluntary Chapter 11 Case Summary MERIDIAN MORTGAGE III: Voluntary Chapter 11 Case Summary MGM RESORTS: Kerkorian's Tracinda Has 26.9% Equity Stake MICHAEL KENWOOD: Faces SEC Charges; Assets Frozen MINOR FAMILY: Status Hearing on Funding of Debtor Moved to Apr. 18 MISSION TOWERS: Cash Collateral Use Extended Until Sale Closing MK CUSTOM: Court Denies Sale of Maricopa County, Ariz. Property MOHEGAN TRIBAL: Posts Statistical Report for Mohegan Sun MOVIE GALLERY: Scam Seeks Payment of Late Fees MPM INVESTOR: Voluntary Chapter 11 Case Summary NETWORK CN: Posts $416,500 Net Loss in September 30 Quarter NORTHERN STAR MINING: Files BIA Proposal; Deloitte is Trustee NUVILEX INC: Posts $45,820 Net Loss in October 31 Quarter ORANGE COUNTY CHOPPERS: Foreclosure Suit Sparks Bankruptcy Rumors OTTER TAIL: Court OKs OTAV-Led Auction on Feb. 16 OWENS CORNING: Garlock Wants to Access Rule 2019 Statements OWENS CORNING: P.I. Claimants Send Letters Seeking Claims Payment OXIGENE INC: Capital Ventures Discloses 6.4% Equity Stake OXIGENE INC: Fails to Meet $50MM Market Value NASDAQ Requirement PARAMOUNT RESOURCES: Moody's Assigns 'Caa1' to C$70MM Unsec Notes PARTSEARCH TECHNOLOGIES: Files Chapter 11 After Losing Best Buy PARTSEARCH TECHNOLOGIES: Case Summary & Creditors List PENINSULA GAMING: S&P Holds 'B+' Corp. Credit Rating; Outlook Neg. PENN TREATY AMERICAN: Deltec Asset Discloses 8.7% Equity Stake PLATINUM STUDIOS: CEO Rosenberg Gives 30-Day Loan of $100,000 PLY GEM HOLDINGS: Inks $175MM Secured ABL Facility With UBS PRECISION OPTICS: Maturity of $600,000 Notes Extended to Feb. 7 PRIMUS TELECOMMS: S&P Holds B- Corp. Credit Rating; Outlook Stable Q2 PROPERTIES: Case Summary & Largest Unsecured Creditor QUANTUM CORP: Reports $5.86-Mil. Net Income in Dec. 31 Quarter RADIENT PHARMACEUTICALS: Securities Subject to NYSE Delisting RASE TECHNOLOGIES: Linden Capital Discloses 2.47% Equity Stake REALOGY CORP: Amends Credit Agreement With Domus, et al. REALOGY CORP: Announces Pricing of $700MM Sr. Secured Notes REFCO INC: Court OKs Togut's Fees for February to October REFCO INC: Files Post-Confirmation Report for Q4 2010 REGAL PLAZA: Hearing on Postpetition Financing Set for February 8 RHI ENTERTAINMENT: Seeks Approval on Exit Term Loan Facility RHI ENTERTAINMENT: Turns Over 15 Films to Settle $37.8MM Debt RHI ENTERTAINMENT: U.S. Trustee Objects to Third-Party Releases ROCKWOOD SPECIALTIES: S&P Upgrades Corporate Credit Rating to 'BB' ROTHSTEIN ROSENFELDT: Ex-Partner Settles Clawback Suit for $350T ROTHSTEIN ROSENFELDT: Republican Party to Return $75,000 ROTHSTEIN ROSENFELDT: Utica Advisors Settles for $700,000 ROYAL CARIBBEAN: Moody's Raises Corp. Credit Rating to 'Ba1' SAVE OUR SPRINGS: 5th Cir. Affirms Chapter 11 Plan Rejection SAVERS INC: Moody's Affirms 'B1' Corporate Family Rating SEALY CORP: Reports $13.74 Million Net Loss in Fiscal 2010 SEDGWICK HOLDING: Moody's Cuts Rating on First-Lien Facility to B2 SH EXPLORATION: Chapter 11 Case Transferred to Dallas SOUTH PADRE INVESTMENT: Files for Chapter 11 in Corpus Christi SOUTH PADRE INVESTMENT: Voluntary Chapter 11 Case Summary SPRING ER: Court Okays Randy Williams as Chapter 11 Trustee SPRING ER: Chapter 11 Trustee Wants Case Converted to Chapter 7 STEELCASE INC: S&P Assigns Preliminary 'BB+' Debt Ratings STEVEN-THOMAS: Don Presley Auctions to Liquidate Last Inventory SUPERMEDIA INC: Files Post-Confirmation Report for Dec. 31 Qtr. SWB WACO: Chapter 11 Plan Declared Effective on Jan. 25, 2011 SYNERGY BRANDS: Files for Chapter 7 Liquidation TERREMARK WORLDWIDE: Verizon Deal Cues S&P's 'B-' Rating TOWNSENDS INC: Gets Interim Nod of Loan; Feb. 15 Auction Set TRANSTAR HOLDING: S&P Puts 'BB-' Rating on $290MM Debt Facilities TRIAD CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors TRIBUNE CO: Committee Wants Zell Claims Objection Denied TRIBUNE CO: Mediator Files Report; Bridge Lenders Accept Plan TRIBUNE CO: Says Cash Flow in 2010 Up by $140MM From 2009 TRIBUNE CO: LA Times Settlement with Liberman Approved TRICO MARINE: Lenders File Emergency Motion Seeking Asset Sale TRICO MARINE: PACC Offshore Withdraws Services Motion TRONOX INC: Submits Settlement Offer Re: "B" Stock Deregistration ULTIMATE ACQUISITION: Asks for Court's Nod to Use Cash Collateral ULTIMATE ACQUISITION: Taps Kurtzman Carson as Claims Agent ULTIMATE ACQUISITION: Must Wait to Pay Vendors, Judge Says UNIFUND ASSURANCE: AM Best Upgrades Issuer Credit Rating to 'bb+' UNION FOR TRADITIONAL JUDAISM: Emerges from Bankruptcy Protection UNITY MEDIA: Starts Down Path to Liquidation in Bankruptcy Court UNIVERSAL BUILDING: Secured Lender Won't Provide Exit Loan VALLEJO, CA: Settles Dispute With Nat'l Public Finance Guarantee VEBLEN EAST: Riverview Offers to Acquire Assets VEBLEN WEST: Riverview Offers to Acquire Assets VERMILION ENERGY: S&P Puts 'BB-' Rating on C$200MM Unsecured Notes VERTRUE INC: S&P Holds 'B' Corp. Credit Rating; Outlook Negative WESTMORELAND COAL: S&P Junks Corp. Credit Rating; Outlook Stable W.R. GRACE: Reorganization Plan Approved by Bankruptcy Court * Daily Beast Says Rhode Island, Connecticut Likely to Go Bankrupt * JPMorgan CEO Predicts U.S. Municipal Bankruptcies * Distressed Real-Estate Investor Strikes Again in New York City * KPMG, Other Advisers Ramp Up for Rise in Bank Restructurings * Large Companies With Insolvent Balance Sheets ********* AIRTRAN HOLDINGS: Reports $1.92-Mil. Net Income for 4th Quarter --------------------------------------------------------------- AirTran Holdings, Inc. reported net income of $1.92 million on $645.54 million of total operating revenue for the three months ended December 31, 2010, compared with net income of $17.09 million on $598.43 million of total operating revenue for the same period the year before. The Company also reported net income of $38.54 million on $2.62 billion of total operating revenue for the twelve months ended December 31, 2010, compared with net income of $134.66 million on $2.34 billion of total operating revenue during the prior year. AirTran says it has reported profits for eight of the past nine years. "What we accomplished in 2010 should be a great source of pride for our 8,500 dedicated Crew Members," said Bob Fornaro, AirTran Airways' chairman, president and chief executive officer. "Most significantly, during 2010 we hit the ball out of the park with our outstanding operational performance and customer service. We also entered into a seven-year lease for expanded facilities at Hartsfield-Jackson Atlanta International Airport and completed a five-year agreement with our pilots. As we look forward to our pending acquisition by Southwest Airlines in 2011, our airline is in the best operational shape ever. We are very well positioned for the next chapter of our exciting history." 2010 marks the third consecutive year AirTran Airways has been recognized for its outstanding operational performance as the number one low-cost carrier in the prestigious Airline Quality Rating -- http://www.aqr.aero-- and the sixth consecutive year the airline has been ranked in the top three among major U.S. airlines in this highly-regarded, objective ranking. A copy of the press release on AiTran's fourth quarter and full year 2010 results is available for free at http://is.gd/bTxGV8 About AirTran Holdings Headquartered in Orlando Florida, AirTran Holdings Inc. (NYSE: AAI) -- http://www.airtran.com/-- through its wholly owned subsidiary, AirTran Airways, Inc., operates scheduled airline service throughout the United States and to selected international locations. The Company's balance sheet at Sept. 30, 2010, showed $2.18 billion in total assets, $601.77 million in total current liabilities, $16.21 million in long-term capital lease obligations, $885.89 million in long-term debt, $109.09 million in other liabilities, $19.38 million in deferred income taxes, $29.61 million in derivative financial instruments, and stockholders' equity of $515.18 million. * * * AirTran carries 'Caa1' corporate family and probability of default ratings from Moody's Investors Service. It has 'B-' issuer credit ratings from Standard & Poor's. At the end of September 2010, Moody's said it has placed AirTran's corporate family rating under review for possible upgrade, after the announcement that Southwest Airlines, Inc., has entered into a definitive agreement to acquire 100% of the outstanding common stock of AirTran for cash and common stock aggregating $1.4 billion. The companies indicated that a closing would not occur until sometime in the first half of 2011. AMERICAN DIAGNOSTIC: Files for Chapter 11 in Chicago ---------------------------------------------------- American Diagnostic Medicine Inc. filed for Chapter 11 protection (Bankr. N.D. Ill. Case No. 11-03368) on Jan. 28, 2011, in Chicago, Illinois. Founded in 1984 and based in Batavia, Illinois, American Diagnostic provides state of the art imaging technologies to hospitals, clinics, cardiologists, internal medicine groups and other health care providers throughout the United States. With 68 employees, the Debtor provides comprehensive solutions to its customers in areas such as Nuclear Medicine, PET, CT and MRI. The Debtor generates revenues through leasing of imaging equipment to its customers, imaging equipment servicing and other imaging equipment financing arrangements. In 2009, the Debtor earned over $14 million in revenues from operations. The Debtor estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. The Debtors did not file an affidavit that would detail events leading to the Chapter 11 filing. AMERICAN DIAGNOSTIC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: American Diagnostic Medicine Inc. 167 Oswalt Avenue Batavia, IL 60510 Bankruptcy Case No.: 11-03368 Chapter 11 Petition Date: January 28, 2011 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: Carol A. Doyle Debtor's Counsel: Joshua D. Greene, Esq. Michael J. Davis, Esq. SPRINGER, BROWN, COVEY, GAETNER & DAVIS 400 S. County Farm Road, Suite 330 Wheaton, IL 60187 Tel: (630) 510-0000 Fax: (630) 510-0004 E-mail: jgreene@springerbrown.com mdavis@springerbrown.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Sam Kancherlapalli, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Cardinal Health Nuclear Pharmacy Trade Debt $707,606 Services 7000 Cardinal Place Dublin, OH 43017 Cray, Kaiser Ltd. Trade Debt $154,205 1901 South Meyers Road Oakbrook Terrace, IL 60181 National City Capital Scanning Equipment $122,387 995 Dalton Avenue Cincinnati, OH 45203 National City Capital Scanning Equipment $92,733 National City Capital Scanning Equipment $91,388 Butler Pappas Weihmuller Katz Trade Debt $75,000 Craig, LLP Michelle Draper Settlement Agreement $58,000 BC Technical, Inc. Trade Debt $56,831 Clausen Miller P.C. Trade Debt $56,245 Jones Vargas Trade Debt $34,665 ANAMED Engineering Services Trade Debt $34,050 Medx Services Ltd. Trade Debt $30,287 Radiological Physics Service Trade Debt $27,025 GE Medical Systems Trade Debt $26,629 Fisher & Phillips, LLP Trade Debt $26,461 Leasing Innovations Inc. NV LI 2018 Equipment $22,818 Flora Yu Settlement Agreement $22,000 Jon Valenton Settlement Agreement $22,000 Jonathan Singleton Settlement Agreement $22,000 Quinn Ranson Settlement Agreement $22,000 AMERICANWEST BANCORP: U.S. Trustee Forms 3-Member Creditors Panel ---------------------------------------------------------------- Robert D. Miller Jr., the U.S. Trustee for Region 18, appointed three members to the official committee of unsecured creditors in the Chapter 11 case of AmericanWest Bancorporation. The Creditors Committee members are: 1. AmericanWest Statutory Trust I Attn: James H. Byrnes U.S. Bank NA , TFM Corporate Trust Service Once Federal Street, 3rd Floor Boston, MA 02110 Tel: (617) 603-6442 2. AmericanWest Capital Trust II Attn: Steven Cimalore Wilmington Trust Company Rodney Square North 1100 North Market Street Wilmington, DE 19890-1615 Tel: (302) 636-6058 3. AmericanWest Capital Trust III c/o Steven Cimalore Wilmington Trust Company Rodney Square North 1100 North Market Street Wilmington, DE 19890-1615 Tel: (302) 636-6058 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About AmericanWest Bancorporation Headquartered in Spokane, Washington, AmericanWest Bancorporation (OTC BB: AWBC) -- http://www.awbank.net/-- is a bank holding company whose principal subsidiary is AmericanWest Bank, which includes Far West Bank in Utah operating as an integrated division of AmericanWest Bank. AmericanWest Bank is a community bank with 58 financial centers located in Washington, Northern Idaho and Utah. AmericanWest Bancorporation filed for Chapter 11 protection on Oct. 28, 2010 (Bankr. E.D. Wash. Case No. 10-06097). The banking subsidiary was not including in the Chapter 11 filing. Christopher M. Alston, Esq., and Dillon E. Jackson, Esq., at Foster Pepper Shefelman PLLC, in Seattle, Washington, serve as bankruptcy counsel. G. Larry Engel, Esq., at Morrison & Foerster LLP, also serve as counsel. The Debtor estimated assets of $1 million to $10 million and debts of $10 million to $50 million in its Chapter 11 petition. AmericanWest Bancorporation's estimates exclude its banking unit's assets and debts. In the most recent Form 10-Q filed with the Securities and Exchange Commission prior to the bankruptcy filing, AmericanWest Bancorporation reported consolidated assets -- including its bank unit's -- of $1.536 billion and consolidated debts of $1.538 billion as of Sept. 30, 2010. In December 2010, AmericanWest Bancorporation completed the sale of all outstanding shares of its wholly-owned subsidiary, AmericanWest Bank, to a wholly owned subsidiary of SKBHC Holdings LLC, in a transaction approved by the U.S. Bankruptcy Court. ANGIOTECH PHARMACEUTICALS: Files for Chapter 15 in Delaware ----------------------------------------------------------- Angiotech Pharmaceuticals Inc. and its units filed voluntary petiions under Chapter 15 of the Bankruptcy Code in Delaware to seek recognition of their insolvency proceedings under the Companies' Creditors Arrangement Act in Canada as a "foreign main proceeding" under 11 U.S.C. Sec. 1517. Alvarez & Marsal Canada Inc. serves as the Company's monitor in the CCAA cases. The Debtors on January 28 obtained from Mr. Justice Walker of the Supreme Court of British Columbia, in Vancouver, an initial order officially commencing the insolvency proceedings. The Canadian court will convene another hearing on Feb. 17, 2011, on the CCAA cases. The Debtors want the U.S. Bankruptcy Court to restrict creditors from taking certain actions in the U.S. that would undermine "the unified, collective and equitable resolution of the Debtors' liabilities" in the Canadian proceeding. The Debtors want any creditors' actions in the United States stayed so as not to jeopardize the uniform and orderly voluntary administration of the Debtors in the CCAA cases. Plan of Arrangement Angiotech has reached a Recapitalization Support Agreement with holders of a majority of the Company's outstanding $250 million 7.75% Senior Subordinated Notes due 2014. The noteholders have agreed to exchange their Subordinated Notes for common stock in the Company. Qualifying holders of the Subordinated Notes participating in the recapitalization transaction would receive their pro rata share of up to 96% of the common stock of Angiotech issued and outstanding following the completion of the transaction, subject to potential dilution. On March 23, 2006, Angiotech issued the Subordinated Notes and entered into a $425 million senior secured credit facility, which included a $350 million term facility maturing in 2013 and a $75 million revolving credit facility with Credit Suisse, to finance certain acquisitions. On December 11, 2006, Angiotech issued $325 million of senior floating rate notes due 2013 that bear interest annually at LIBOR. The proceeds from the issuance of the Floating Rate Notes were used to pay down the principal amount of $325 million that remained outstanding under the Credit Suisse Credit Facility, which was terminated at that time. Angiotech intends to pursue a separate transaction contemporaneous with, but outside of, the Canadian Proceeding in which it would offer to exchange the existing Floating Rate Notes for new floating rate notes to be secured by a second lien over the property, assets and undertaking of the Debtors. On October 29, 2010, Angiotech entered into a support agreement with respect to such exchange. Liquidity Woes Todd Martin, senior vice president with Alvarez & Marsal Canada Inc., as foreign representative, said in a court filing that Angiotech's original acquisition strategy contemplated that Angiotech would use excess cash flow from royalty revenues to reduce long-term debt by roughly $300 million over a period of three years. "Over the last three years, however, the Debtors have experienced significant and sooner than expected declines in royalty revenues and profits in the Pharmaceutical Technologies segment that have not been materially offset by profits in other business areas. This has made it increasingly difficult for Angiotech to service and pay down its long-term debt and has negatively and materially impacted the Debtors' liquidity and operating results." US$28-Mil. of DIP Financing The Debtors say they have been operating under liquidity constraints for some time. The Debtors commenced the CCAA cases to assist them in restructuring a significant portion of their outstanding debt obligations and returning to a sustainable capital structure. To properly fund the administrative costs associated with the Canadian proceeding and the Chapter 15 cases, as well as the Debtors' continued operations during the pendency of such proceedings, the Debtors have made a good-faith business decision to enter into an agreement with Wells Fargo Capital Finance, LLC, formerly known as Wells Fargo Foothill, LLC, and certain other lenders to obtain access to a $28 million postpetition credit facility. The DIP Facility is, in essence, an extension of the Debtors' prepetition secured credit facility with Wells Fargo. Borrowings under the DIP Facility will be used to fund the Debtors' working capital requirements. The DIP Credit Agreement with Wells Fargo, as arranger and administrative agent for the DIP lenders, contemplates that all of the Debtors' cash receipts will be used by pay down amounts in satisfaction of prepetition obligations outstanding under the prepetition facility during the pendency of the proceedings until the prepetition obligations are paid in full. The DIP Lender has conditioned the availability of funds upon the U.S. Court's grant of 11 U.S.C. Section 364(e) protections to such facility. Alvarez & Marsal as Monitor The Debtors have obtained approval from the Canadian court to appoint Alvarez & Marsal Canada as the monitor. The Monitor is responsible for, among other things, assisting the Debtors in their reorganization efforts and reporting to the Canadian Court. About Angiotech Pharmaceuticals Based in Vancouver, British Columbia, in Canada, Angiotech Pharmaceuticals, Inc. (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 US$326.80 million in total assets, US$60.30 million in current liabilities, and US$622.16 million in non-current liabilities and a stockholders' deficit of US$355.67 million. ANGIOTECH PHARMACEUTICALS: Chapter 15 Case Summary -------------------------------------------------- Chapter 15 Petitioner: Alvarez & Marsal Canada Inc., as Monitor and Foreign Representative Chapter 15 Debtor: Angiotech Pharmaceuticals, Inc. 1618 Station Street Vancouver, Canada Chapter 15 Case No.: 11-10269 Debtor-affiliates also subject to Chapter 15 petitions: Entity Case No. ------ -------- 0741693 B.C. Ltd. 11-10270 Afmedica, Inc. 11-10271 American Medical Instruments Holdings, Inc. 11-10272 Angiotech America, Inc. 11-10273 Angiotech BioCoatings Corp. 11-10274 Angiotech Delaware, Inc. 11-10275 Angiotech Florida Holdings, Inc. 11-10276 Angiotech International Holdings, Corp. 11-10277 Angiotech Pharmaceuticals (US), Inc. 11-10278 B.G. Sulzle, Inc. 11-10279 Manan Medical Products, Inc. 11-10280 Medical Device Technologies, Inc. 11-10281 NeuColl Inc. 11-10282 Quill Medical, Inc. 11-10283 Surgical Specialties Corporation 11-10284 Surgical Specialties Puerto Rico, Inc. 11-10285 Chapter 15 Petition Date: Jan. 30, 2011 Court: U.S. Bankruptcy Court District of Delaware (Delaware) About the Debtors: Based in Vancouver, British Columbia, in Canada, Angiotech Pharmaceuticals, Inc. (TSX: ANP) -- http://www.angiotech.com/-- is a global specialty pharmaceutical and medical device company. Angiotech and its units have voluntarily filed under the Companies' Creditors Arrangement Act in order to continue implementation of their recapitalization transaction. Angiotech has reached an agreement with noteholders to convert $250 million 7.75% Senior Subordinated Notes into common stock. Petitioner's Counsel in Chapter 15 Case: Mary Caloway, Esq. BUCHANAN INGERSOLL & ROONEY PC 1105 North Market Street, Suite 1900 Wilmington, DE 19801-1228 Tel: (302) 552-4209 Fax: 302-552-4295 E-mail: mary.caloway@bipc.com - and - Ken Coleman, Esq. ALLEN & OVERLY LLP 1221 Avenue of the Americas New York, New York 10020 Tel: (212) 610-6300 Fax: (212) 610-6399 Total Assets: US$326.80 million at Sept. 30, 2010 Total Debts: US$682.46 million at Sept. 30, 2010 The Chapter 15 petitions were signed by Todd Martin, senior vice president with Alvarez & Marsal Canada Inc., as foreign representative. ANGIOTECH PHARMACEUTICALS: CCAA Case Summary -------------------------------------------- Applicants Under the the Companies' Creditors Arrangement Act: -- Angiotech Pharmaceuticals Inc., -- 0741693 B.C. Ltd., -- Angiotech International Holdings, Corp., -- Angiotech Pharmaceuticals (US), Inc., -- American Medical Instruments Holdings, Inc., -- NeuColl, Inc., -- Angiotech BioCoatings Corp., -- Afmedica, Inc., -- Quill Medical, Inc., -- Angiotech America, Inc., -- Angiotech Florida Holdings, Inc., -- B.G. Sulzle, Inc., Surgical Specialties Corporation, -- Angiotech Delaware, Inc., -- Medical Device Technologies, Inc., -- Manan Medical Products, Inc. and -- Surgical Specialties Puerto Rico, Inc Filing Date: Jan. 28, 2011 Court: Supreme Court of British Columbia, in Vancouver Judge: Mr. Justice Walker About the Applicants: Based in Vancouver, British Columbia, in Canada, Angiotech Pharmaceuticals, Inc. (TSX: ANP) -- http://www.angiotech.com/-- is a global specialty pharmaceutical and medical device company. Angiotech and its units have voluntarily filed under the Companies' Creditors Arrangement Act in order to continue implementation of their recapitalization transaction. Angiotech has reached an agreement with noteholders to convert $250 million 7.75% Senior Subordinated Notes into common stock. Applicants' Monitor: ALVAREZ & MARSAL CANADA INC. Counsel for Alvarez & Marsal, as Monitor: John Grieve, Esq. FASKEN MARTINEAU DuMOULIN LLP Suite, 2900, 550 Burrard Street Vancouver, B.C. Counsel for Consenting Noteholders in CCAA Case: Rob Chadwick, Esq. Logan Willis, Esq. GOODMANS LLP Suite 3400, 333 Bay Street Toronto, Ontario Counsel for "Independent Committee": Maria Konyuckhova, Esq. STIKEMAN ELLIOTT LLP Suite 1700, 666 Burrard Street Vancouver, B.C. Counsel for Wells Fargo, as DIP Lender: Bill Kaplan, Q.C., Esq. Peter Rubin, Esq. BLAKE, CASSELS & Graydon LLP Suite 2600, 595 Burrard Street Vancouver, B.C. Total Assets: US$326.80 million at Sept. 30, 2010 Total Debts: US$682.46 million at Sept. 30, 2010 ANGIOTECH PHARMACEUTICALS: Moody's Cuts PDR to 'D' on CCAA Filing ----------------------------------------------------------------- Moody's Investors Service downgraded the probability of default rating of Angiotech Pharmaceuticals Inc. to D from Ca/LD and affirmed the Ca corporate family rating. The downgrade was prompted by Angiotech's January 28, 2011 announcement that it and certain of its subsidiaries have file for bankruptcy under Canada's Companies' Creditors Arrangement Act in order to continue implementation of its previously announced recapitalization transaction. Subsequent to the actions, Moody's will withdraw the ratings because Angiotech has entered bankruptcy. This rating was downgraded: Angiotech Pharmaceuticals, Inc. -- Probability of Default Rating to D from Ca/LD Ratings and LGD assessment affirmed: -- Corporate Family Rating at Ca -- $325 Million Senior Unsecured Notes at Caa2; (LGD2, 27%) -- $250 Million Senior Subordinated Notes at C; (LGD5, 82%) -- Speculative Grade Liquidity Rating at SGL-4 The last rating action was on November 1, 2010, when Moody's downgraded the probability-of-default rating to Ca/LD from Ca. The ratings outlook remained negative. The principal methodologies used in this rating were Global Medical Products & Device Industry published in October 2009, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Angiotech Pharmaceuticals, Inc., founded in 1992, based in Vancouver, Canada, is a specialty pharmaceutical and medical device company that focuses on acute and surgical applications. ARVINMERITOR INC: S&P Hikes Rating to 'B'; Outlook Stable --------------------------------------------------------- Standard & Poor's Ratings Services said it has raised its corporate credit rating on ArvinMeritor Inc. to 'B' from 'B-'. The outlook is stable. At the same time, S&P also raised its issue-level ratings on the Company's senior secured and unsecured debt. "The upgrade reflects our opinion that commercial-vehicle demand is recovering in North America and Western Europe, and we expect ArvinMeritor to show higher sales and profitability in fiscal 2011," said Standard & Poor's credit analyst Lawrence Orlowski. Moreover, the Company essentially completed the divestiture of its light-vehicle systems businesses in 2010, which should allow management to focus on expanding its commercial and industrial businesses. In fiscal 2010 (ended Sept. 30), revenue totaled $3.59 billion, up 17% year over year. Commercial-truck sales were $1.96 billion, up 25% from the same period a year ago mostly because of higher original equipment sales in all geographic segments. Industrial sales were $951 million, up 7% as a result of stronger sales in China and India, mostly offset by decreased sales for military products. Aftermarket and trailer sales were $969 million, up 2% year over year. S&P expects credit measures to improve in fiscal 2011, reflecting higher truck demand. S&P expects commercial-vehicle production in North America and Western Europe to increase in 2011 and 2012. For instance, FTR Associates is forecasting North American Class 8 and Class 4-7 commercial-vehicle production to rise more than 35% in 2011 from 2010 levels. Net Class 8 orders in December jumped 125% year over year, and U.S. freight tonnage rose 5.7% year over year. Also, J.D. Power and Assoc. is forecasting medium- and heavy- duty commercial-vehicle production in Western Europe to increase 24% in 2011. (J.D. Power, like Standard & Poor's, is owned by The McGraw-Hill Companies Inc. but operated independently of Standard & Poor's.) Still, the strength of recovery remains subject to the sustainability of economic recovery in many markets. Nevertheless, the Company's restructuring in 2009 laid the foundation for greater profitability, and S&P believe EBITDA will rise in fiscal 2011 as truck sales continue to recover. The ratings on ArvinMeritor reflect the Company's highly leveraged financial risk profile and weak business risk profile. The Company's limited profitability has kept cash generation low, given the cyclical and competitive pricing pressures of the industry. Although S&P expect margins to improve, S&P believe pension funding and working capital investments will result in a use of cash in fiscal 2011. But S&P believe the Company's large cash balances will be sufficient to fund this cash use. The outlook is stable. S&P believe commercial-vehicle sales in North America and Europe are recovering, leading to higher profitability and liquidity. For the current rating, S&P expect adjusted leverage to drop below 6x and the use of free cash flow not to exceed $100 million in fiscal 2011. S&P could lower S&P's ratings if commercial-truck demand starts to falter, the Company's use of free operating cash flow exceeds $100 million, and leverage fails to drop toward 6x. For instance, this could occur if revenue increases about 10% and gross margins fall below 10% in fiscal 2011. S&P could raise the ratings if truck demand continues to recover and the Company expands EBITDA margins and brings leverage below 4x. This could occur if, for instance, revenue increases at least 25% and gross margins reach 15% in fiscal 2011. At the same time, S&P would expect ArvinMeritor to generate strong positive free cash flow on a sustained basis. BAKER'S KEYBOARD: Receives Offers for Club ------------------------------------------ Susan Whitall at The Detroit News reports that Baker's Keyboard Lounge has received offers for its assets, ahead of an auction scheduled for January 31. Realtor Paul Feldman handled the offers, and as of Friday had three, with each prospective buyer intending to keep Baker's up and running as a jazz club. The highest bid as of Friday was $385,000. The auction was to be held at the law offices of Schneider Miller in the Penobscot Building, 645 Griswold, in Detroit. John Colbert owns Baker's Keyboard Lounge, buying the club from Clarence Baker in 1996. Mr. Colbert filed for Chapter 13 bankruptcy last summer. BEAR MOUNTAIN: Ex-NHL Player Won't Recoup Investment ---------------------------------------------------- Jim Jamieson and Andrew Duffy, writing for Vancouver Province and Victoria Times Colonist, report that former Vancouver Canucks goaltender Sean Burke took former investment partner Len Barrie into the boards last Wednesday as details emerged that he and other current and ex-National Hockey League partners will lose more than C$13 million in the bankrupt Bear Mountain golf resort and real estate development near Victoria. Mr. Burke, as one of the 18 hockey players who invested in the project, will get nothing from the bankruptcy proceedings. He bought a 1% share for C$600,000 at the beginning of the project. Mr. Burke, 43, is now the goaltending coach for the Phoenix Coyotes. The report also says rumors of an RCMP investigation on the project have been circulating. The report, however, notes RCMP spokesman Const. According to the report, Michael McLaughlin, who speaks for federal programs including the Integrated Market Enforcement Team, did not return calls Wednesday. The report relates Bear Mountain Resort is now controlled by HSBC Bank Canada after restructuring. The report says Bear Mountain said it is still going through records to clean up any outstanding issues surrounding entities it did not have control over through the Companies' Creditors Arrangement Act process. The report also notes Michael Vermette of PricewaterhouseCoopers, which oversaw the Bear Mountain restructuring process, said the court date is simply another in a series of administrative procedures to wind up the process. The development was placed under creditor protection in March 2010, at the behest of HSBC. The report says the resort was in default on some of its loans and owed secured creditors more than C$300 million. HSBC was by far the largest secured creditor, owed more than C$250 million. BEST STAY: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: Best Stay Coldwater, Inc. 2111 N. Wixom Rd. Wixom, MI 48393 Bankruptcy Case No.: 11-41953 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Eastern District of Michigan (Detroit) Judge: Steven W. Rhodes Debtor's Counsel: Robert N. Bassel, Esq. P.O. Box T Clinton, MI 49236 Tel: (248) 677-1234 Fax: (248) 369-4749 E-mail: bbassel@gmail.com Estimated Assets: $500,001 to $1,000,000 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 Saher Sandiha, president. BLUEKNIGHT ENERGY: Swank Capital Disappointed With Proposed GTA --------------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on January 28, 2011, Swank Capital, LLC, Cushing MLP Asset Management, LP and Jerry V. Swank expressed their continuing disappointment in Blueknight Energy Partners, L.P.'s decision to proceed with the Global Transaction Agreement and clarified certain issues raised by the Partnership's response to the Letter dated January 5, 2011. In a letter dated January 27, 2011, Swank Capital, et al., complained that they were never allowed to have input on the restructuring, despite what the Company assured them. Each of Swank Capital, Cushing MLP Asset Management and Jerry V. Swank beneficially owns 3,516,315 shares of common stock of Blueknight Energy representing 16.2% of the shares outstanding. As of November 5, 2010, there were 21,538,462 preferred units, 21,727,724 common units and 12,570,504 subordinated units outstanding. Vitol Deal, GTA Modification As reported in the Jan. 21, 2011 edition of the Troubled Company Reporter, Blueknight Energy Partners, L.P., have exchanged letters with Solus Alternative Asset Management LP, owner of 7.2% of the common units of the Partnership, and Swank Capital, LLC, owner of 16.2%, in connection with the shareholders' objections to further implementation of a Global Transaction Agreement. As contemplated by the Global Transaction Agreement entered into on October 25, 2010, by and among Blueknight Energy Partners, L.P., Blueknight Energy Partners G.P., L.L.C., the general partner of the Partnership (the "General Partner"), Blueknight Energy Holding, Inc. ("Vitol Holding") and CB-Blueknight, LLC ("Charlesbank Holding"), on November 12, 2010, the General Partner purchased 433,758 General Partner Units in the Partnership to maintain the General Partner's approximate 2% general partner interest in the Partnership in exchange for aggregate consideration of approximately $2.8 million. The General Partner Units were issued and sold in a private transaction exempt from registration under Section 4(2) of the Securities Act of 1933, as amended, and certain rules and regulations promulgated under that section. In a Jan. 5 letter to Blueknight, Swank Capital said, "Although we are disappointed with the GTA and believe that it violates the intent of fair dealings set forth in the Partnership Agreement, we are encouraged that you are willing to consider modifications in order to better align the long-term interests of all stakeholders of the Partnership." Solus also raised "serious" objections to the transactions outlined in the GTA. Solus believes that the General Partner has acted improperly with regard to the terms of the Phase I Transactions. In a January 12 letter to Blueknight, Solus said, "We ask that you reconsider the Global Transaction Agreement, an option which the General Partner and its Conflicts Committee specifically retained." On January 18, 2011, Solus and Swank received a written response from Mr. Dyer, the CEO of the General Partner. "Everyone is well aware that Blueknight faced great uncertainty and many risks following the bankruptcy filing of SemCrude, et. al. The loss of a majority of Blueknight's revenues, its excessive debt, defaults and restrictive covenants under its credit facility, increased interest payments and costly bank fees, and its ongoing shareholder litigation created for Blueknight a set of narrow and unsatisfactory options. You and other of our significant unitholders have access to capital and were certainly more than welcome to have submitted proposals for restructuring of the partnership. To our knowledge, only one such proposal was ever submitted. That proposal suggested an all-debt refinancing option, a notion determined to be infeasible by every investment banker with whom we discussed possible recapitalization ideas, including the same institution that had originally suggested the all-debt refinancing option," Mr. Dyer stated in the letter. "Blueknight went to great lengths to figure out terms on which equity capital -- true risk capital -- could be made available to underwrite a refinancing plan. We were well aware that without Vitol leading the refinancing, with both the equity infusion and with a new bank facility, there was no path to financial recovery. None. We were able to convince Vitol and later Charlesbank that bankruptcy was not the best solution for the Partnership, an option we did consider and one that would have certainly all but eliminated any remaining value for the Common Unitholders." In response to the letter, Solus and Swank jointly stated January 19, "Notwithstanding the statements made in your letter, we wish to emphasize that at no time was Solus made "welcome" to submit a proposal for a restructuring of the Partnership. In fact, we are extremely disappointed that the general partner of the Partnership did not approach us for access to the capital which you apparently know that we have. Your contention that Vitol presented the only path for the Partnership's financial recovery is unsupportable. We remain ready to discuss a possible debt/equity infusion, or another transaction, for the Partnership on significantly better economic terms than those which the general partner obtained from its controlling persons." About Blueknight Energy Blueknight Energy Partners, L.P. (Pink Sheets: BKEP) -- http://www.bkep.com/-- provides integrated terminalling, storage, processing, gathering and transportation services for companies engaged in the production, distribution and marketing of crude oil and asphalt product. It provides services for the customers, and its only inventory consists of pipeline linefill and tank bottoms necessary to operate the assets. It has three operating segments: crude oil terminalling and storage services, crude oil gathering and transportation services, and asphalt services. The Company's balance sheet at Sept. 30, 2010, showed $295.96 million in total assets, $444.02 million in current liabilities, $4.69 million in long-term payable to related parties, and a partners' deficit of $152.75 million. * * * PricewaterhouseCoopers LLP, in Tulsa, Okla., in its report on the Partnership's financial statements for the year ended December 31, 2009, expressed substantial doubt about its ability to continue as a going concern. The independent auditors noted that the Partnership has substantial long-term debt, a deficit in partners' capital, and significant litigation uncertainties. CALYPTE BIOMEDICAL: Posts $10.49MM Net Income in Sept. 30 Qtr. -------------------------------------------------------------- On January 28, 2011, Calypte Biomedical Corporation filed its quarterly report on Form 10-Q, reporting net income of $10,488,000 on $124,000 of revenue for the three months ended September 30, 2010, compared with a net loss of $907,000 on $25,000 of revenue for the same period a year ago. The Company's balance sheet at September 30, 2010 showed $2.44 million in total assets, $6.21 million in total liabilities and a $3.77 million stockholders' deficit. A full-text copy of the Form 10-Q is available for free at http://ResearchArchives.com/t/s?72a4 About Calypte Biomedical Portland, Ore.-based Calypte Biomedical Corporation develops, manufactures, and distributes in vitro diagnostic tests, primarily for the diagnosis of Human Immunodeficiency Virus infection. Odenberg, Ullakko, Muranishi & Co. LLP, in San Francisco, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2009 results. The independent auditors noted that the Company has defaulted on $6.3 million of 8% Convertible Promissory Notes and related Interest Notes and $5.2 million of 7% Promissory Notes, has suffered recurring operating losses and negative cash flows from operations, and management believes that the Company's cash resources will not be sufficient to sustain its operations through 2010 without additional financing. CAMBRIDGE-LEE HOLDINGS: Unit Files Schedules of Assets and Debts ---------------------------------------------------------------- Tubo de Pasteje, S.A. de C.V., an affiliate of Cambridge-Lee Holdings, Inc., filed with the U.S. Bankruptcy Court for the District of Delaware its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property N/A B. Personal Property Undetermined C. Property Claimed as Exempt1 D. Creditors Holding Secured Claims $200,000,000 E. Creditors Holding Unsecured Priority Claims N/A F. Creditors Holding Unsecured Non-priority Claims $6,323,065 ----------- ----------- TOTAL Undetermined $206,323,065 A full-text copy of the schedules is available for free at: http://bankrupt.com/misc/CambridgeLEe_SAL.pdf About Cambridge-Lee and Tubo de Pasteje Cambridge-Lee Holdings, Inc., and Tubo de Pasteje, S.A. de C.V., filed for Chapter 11 protection on December 8, 2009, (Bankr. D. Del. Case Nos. 09-14352 and 09-14353). Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Debtors. The U.S. Trustee was unable to appoint an official committee of unsecured Creditors in these cases. Tubo is a subsidiary of Mexico City-based Industrias Unidas SA de CV, a manufacturer of copper and electrical products. The U.S. subsidiary Cambridge-Lee is based in Reading, Pennsylvania. IUSA is the issuer of the notes which were secured by a pledge of the stock of Cambridge-Lee. CAMBRIDGE-LEE HOLDINGS: Wants Until March 7 to File Ch 11 Plan -------------------------------------------------------------- Cambridge-Lee Holdings, Inc., and Tubo de Pasteje, S.A. de C.V., ask the U.S. Bankruptcy Court for the District of Delaware to extend their exclusive periods to file and solicit acceptances for a proposed chapter 11 plan until March 7, 2011, and May 6, 2011. The Debtors, the group of Industrias Unidas, S.A. de C.V., direct parent company of Tubo, need more time to negotiate with their stakeholders to develop an appropriate exit from bankruptcy. The IUSA Group has been exploring a long term solution for its cash flow problems, seeking to bridge the current economic dislocation. Representatives of the IUSA Group have participated in discussions, starting before the Petition Date, with the ad hoc group of holders of the notes regarding the technical default and a potential restructuring of certain terms of the indenture, dated as of November 13, 2006. About Cambridge-Lee and Tubo de Pasteje Cambridge-Lee Holdings, Inc., and Tubo de Pasteje, S.A. de C.V., filed for Chapter 11 protection on December 8, 2009, (Bankr. D. Del. Case Nos. 09-14352 and 09-14353). Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Debtors. Tubo de Pasteje, S.A. de C.V., disclosed undertermined assets and $206,323,065 in liabilities. The U.S. Trustee was unable to appoint an official committee of unsecured Creditors in these cases. Tubo is a subsidiary of Mexico City-based Industrias Unidas SA de CV, a manufacturer of copper and electrical products. The U.S. subsidiary Cambridge-Lee is based in Reading, Pennsylvania. IUSA is the issuer of the notes which were secured by a pledge of the stock of Cambridge-Lee. CAPITOL THEATRE: Windsor Seeks Partnership to Take Over Operations ------------------------------------------------------------------ Craig Pearson, writing for The Windsor Star, reported that the Capitol Theatre in Windsor, Ontario, would be under the city's hands beginning Monday. For three years, the Capitol Theatre operated under bankruptcy. The report said Mayor Eddie Francis has said the city will not operate the 91-year-old theatre without a partnership with another institution, such as the University of Windsor or St. Clair College. The report notes no agreement has been finalized. "Before we chose the date of Jan. 31, we asked the trustee for all the contracted out shows," Mr. Francis said last week by phone from Germany, where he is on city business, according to the report. "And he told us that there were shows contracted out to Jan. 31. So there should be no shows contracted out after that. That's why we chose that date." The report relates Mr. Francis said he hopes to explore whether the city could temporarily keep running the facility as it has been since going bankrupt. The report notes bankruptcy trustee Stephen Funtig, who has overseen the Capitol since it went bankrupt in 2007, did not return a call from The Star Wednesday. CARTER'S GROVE: Defaults Payment; Headed for February Auction ------------------------------------------------------------- Desiree Parker at the Williamsburg Yorktown Daily reports Carter's Grove, in Williambsburg, Virginia, will be on the auction block at 1:00 p.m., on Feb. 15. 2011. Carter's Grove LLC, the entity CNet founder Halsey Minor used to purchase the plantation for $15.3 million in 2007, failed to make the final two payments for a $10.3 million mortgage to Colonial Williamsburg. Mr. Minor's entity, Minor Family LLC, filed for Chapter 11 bankruptcy protection on Sept. 1, 2010, in the U.S. Bankruptcy Court for the Western District of Virginia (Case No. 10-62543). CATALYST PAPER: Elk Falls Mill Liquidation Ongoing -------------------------------------------------- Dan MacLennan, at the Courier-Islander, reports that the major equipment making up the heart of Catalyst Paper Corp.'s Elk Falls Mill, in Canada, is the subject of a liquidation sale now officially under way. According to the report, Maynards Industries has announced the "liquidation sale of the entire Elk Falls paper mill & kraft mill" with a five-page flyer. "Right now we're just focusing on moving some of the paper machines overseas if possible," Maynard's Mike Seibold was quoted saying. The report relates that when Catalyst permanently shut down the mill last year after almost 60 years of operation, there were hopes by some that a buyer could be found to reopen the mill. But Catalyst is clearly not interested in bringing new competitors into the B.C. market, particularly when demand for pulp and paper has slumped, the Courier-Islander says. About Catalyst Paper Based in Richmond, British Columbia, in Canada, Catalyst Paper Corporation (TSX:CTL) manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With six facilities located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.5 million tonnes. The Company's balance sheet at Sept. 30, 2010, showed C$1.73 billion in total assets, C$1.32 billion in total liabilities, and stockholders' equity of C$406.2 million. * * * In mid-March 2010, Moody's Investors Service downgraded Catalyst's Corporate Family Rating to 'Caa1' from 'B3'. Catalyst's CFR downgrade anticipates a marked deterioration in the company's financial performance over the coming year, with significant EBITDA erosion compared to 2009 levels and negative free cash flow generation. In May 2010, Standard & Poor's Ratings Services revised the outlook on Catalyst to stable from negative. S&P affirmed the 'CCC+' long-term corporate credit rating on the Company. The ratings on Catalyst reflect S&P's view of the company's highly leveraged capital structure, history of weak profitability, fiber supply issues, and its participation in cyclical commodity markets. In Standard & Poor's opinion, these risks are partially mitigated by the company's revenue diversity and improving cost profile. CATHOLIC CHURCH: Milwaukee Proposes Bear Realty as Broker --------------------------------------------------------- Pursuant to Section 327 of the Bankruptcy Code, the Archdiocese of Milwaukee seeks authority from the United States Bankruptcy Court for the Eastern District of Wisconsin to employ Bear Realty, Inc., as its real estate broker. Prior to the Petition Date, the Archdiocese employed retained Bear Realty as its real estate agent for the sale of the property at 8320 402nd Avenue, Town of Wheatland, in Kenosha County, Wisconsin, Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, tells Judge Kelley. He avers that the uninterrupted service of Bear Realty is vital to maximize the value of the bankruptcy estate. Subject to the Court's approval, Bear Realty will continue to serve as the real estate broker for the Kenosha Property as well as render these additional services: -- marketing the Kenosha Property to obtain the highest and best price possible for the Archdiocese; and -- providing consultation to the Archdiocese in connection with the sale of the Kenosha Property. Pursuant to Rule 2014 of the Local Rules of the United States Bankruptcy Court for the Eastern District of Wisconsin, the Archdiocese seeks permission to pay Bear Realty a commission of 6% of the purchase price of the Kenosha Property. The commission will, in accordance with Local Rule 2014, serve as a fee cap for Bear Realty's engagement in the reorganization case. Mr. Diesing says that Bear Realty will seek payment for its professional services at the time the Kenosha Property is sold. Justin D. Snyder, a member of Bear Realty, assures Judge Kelley that his firm does not currently represent any of the Archdiocese's secured creditor or its 20 largest unsecured creditors as of January 4, 2011. He adds that Bear Realty has likely provided services unrelated to the Archdiocese to companies and individuals that have conducted business with the Archdiocese, and who may be creditors of the bankruptcy estate. 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: Milw. Wants RFP & Cassidy as Co-Listing Agents --------------------------------------------------------------- The Archdiocese of Milwaukee seeks authority from the United States Bankruptcy Court for the Eastern District of Wisconsin to employ Cassidy Turley Barry, Inc., and RFP Commercial, Inc., as its real estate brokers and co-listing agents. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, contends that employing Cassidy Turley and RFP Commercial as Co-Listing Agents for certain parcels of real estate benefits the bankruptcy estate because it will assist the Archdiocese in converting illiquid assets into liquid assets that can assist the Archdiocese in its reorganization. Prior to the Petition Date, the Co-Listing Agents served as real estate brokers for the Archdiocese's interests in the properties in these locations: (a) the Cousins Center at 3501 South Lake Drive, in the city of St. Francis, Wisconsin; (b) 2458 West Locust Street, in the city of Milwaukee, Wisconsin; (c) 8900 W. Ryan & SEC of Ryan & 92nd Street, in the city of Franklin, Wisconsin; (d) NWC of Mequon Road & Wausaukee Road, in the village of Germanton, Wisconsin; and (e) S. Racine & W. National Avenue, in the city of New Berlin, Wisconsin. Subject to the Court's approval, the Co-Listing Agents will continue to serve as the real estate brokers for the Properties, as well as render additional services, Mr. Diesing tells Judge Kelley. At the Archdiocese's discretion, the Co-Listing Agents may also serve as real estate brokers for any additional parcels of real property that the Archdiocese may attempt to sell, he adds. In accordance with Section 330(a) of the Bankruptcy Code, and in keeping with the Archdiocese's prepetition agreements with the Co- Listing Agents, the Archdiocese tells the Court that it intends to pay the Agents on a commission basis. Pursuant to Rule 2014 of the Local Rules of the United States Bankruptcy Court for the Eastern District of Wisconsin, the Archdiocese seeks authority to pay the Co-Listing Agents a commission of (i) 6% of the purchase price of the Cousins Center, (ii) 7% of the purchase price for the other Properties, and (iii) up to 7% of the purchase price, to be negotiated in advance by the Archdiocese with the Co-Listing Agents, for any other parcels of real property for which the Archdiocese employs the Co-Listing Agents as real estate brokers. The commission percentages serve as a fee cap for the Co-Listing Agents' engagement in the reorganization case, Mr. Diesing says. He adds that the Co-Listing Agents will seek payment for their professional services at the time any real estate for which they serve as the Archdiocese's real estate brokers is sold. James T. Barry III, president of Cassidy Turley, and Robert E. Flood Jr., a partner at RFP Commercial, relate that the Co-Listing Agents provide real estate services to numerous companies and individuals in Wisconsin, and some of the companies may have provided goods and services to the Archdiocese. Messrs. Barry and Flood, however, assure the Court that their firms' services to those parties, if any, are unrelated to the Archdiocese's bankruptcy proceeding and do not create a conflict of interest. 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: U.S. Trustee Won't Oppose Milw. Hiring of Firms ---------------------------------------------------------------- Patrick S. Layng, the U.S. Trustee for Region 11, through his assistant, David W. Asbach, filed certificates of no objection in response to these requests made by the Archdiocese of Milwaukee: -- application to employ Leverson & Metz S.C. as special its counsel; -- application to employ Cassidy Turley Barry, Inc., and RFP Commercial, Inc., as real estate brokers for the Archdiocese; -- application to employ Whyte Hirschboeck Dudek S.C. as its counsel; -- application to employ Buelow Vetter Buikema Olson & Vliet, LLC, as its special counsel; -- application to employ Quarles & Brady LLP as its special counsel; -- application to employ Baker Tilly Virchow Krause, LLP, as its accountants; and -- application to employ O'Neil, Cannon, Hollman, DeJong & Laing S.C. as its special counsel. 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) CELL THERAPEUTICS: Amends Form 8-K on $25MM Pref. Stock Deal ------------------------------------------------------------ On January 18, 2011, Cell Therapeutics, Inc. filed a current report on Form 8-K reporting that the Company had entered into a Securities Purchase Agreement with an institutional investor on January 12, 2011. As reported in the Troubled Company Reporter, the Company entered into a securities purchase agreement to sell, subject to certain closing conditions, up to $25.0 million of shares of its Series 8 Non-Convertible Preferred Stock, warrants to purchase up to 22,563,177 shares of common stock and an additional investment right to purchase up to $25.0 million of shares of its Series 9 Convertible Preferred Stock, in a registered offering to a single life sciences institutional investor. The Company filed, on January 28, 2011, an amended Form 8-K to report: -- the filing on January 26, 2011, of Articles of Amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Washington to establish the Company's Series 8 non-convertible preferred stock, no par value per share; and -- the effectiveness on January 27, 2011, of the Series 8 Articles of Amendment, which establish and designate the Series 8 Preferred Stock and the rights, preferences and privileges thereof. About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. The Company's balance sheet at September 30, 2010, showed $46.6 million in total assets, $38.9 million in total liabilities, $13.4 million in common stock purchase warrants, and a stockholders' deficit of $5.7 million. Stonefield Josephson, Inc., in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has sustained loss from operations, incurred an accumulated deficit, and has substantial monetary liabilities in excess of monetary assets as of December 31, 2009. CHIPOLA RIVER: Case Summary & 8 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Chipola River Townhouses, Inc. 3196 Townhouse Drive Marianna, FL 32446 Bankruptcy Case No.: 11-50033 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Northern District of Florida (Panama City) Debtor's Counsel: Robert C. Bruner, Esq. 215 Delta Court Tallahassee, FL 32303 Tel: (850) 385-0342 Fax: (850) 385-0977 E-mail: RobertCBruner@hotmail.com Scheduled Assets: $1,107,400 Scheduled Debts: $757,543 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flnb11-50033.pdf The petition was signed by Gerald McGee, president. CHRYSLER GROUP: Posts $199MM Q4 Net Loss; In Talks With Banks ------------------------------------------------------------- Jeff Bennett, writing for Dow Jones' Newswires, reports that Chrysler Group LLC, posted a net loss of $199 million for the fourth quarter of 2010 as interest payments on its government loans continued to gnaw at the auto maker's bottom line. Dow Jones points out the loss was much smaller than its $2.69 billion deficit in the year-ago quarter. For all of 2010 Chrysler had a loss of $652 million. Dow Jones says Chrysler didn't disclose a comparable figure for 2009, when it was in bankruptcy. According to Dow Jones, Chief Executive Sergio Marchionne said the company would have made money if it hadn't had to pay $329 million in interest in the fourth quarter. Its interest payments for the year totaled $1.23 billion. Dow Jones relates Mr. Marchionne also predicted that Chrysler would return to profitability this year and said the company's partner, Fiat SpA, would likely meet the remaining U.S.-government requirements to raise its stake in Chrysler to 35% from 25% this year. According to the report, Chrysler is working on a plan to secure financing from a group of banks, including Goldman Sachs Group Inc., and use the funds to repay the $7.4 billion in loans it received from the U.S. and Canadian governments before filing for bankruptcy in 2009. The bank financing would come at a lower interest rate than the government loans. About Chrysler Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20% equity interest in Chrysler Group. The U.S. and Canadian governments provided Chrysler with $4.5 billion to finance its bankruptcy case. Those loans are to be repaid with the proceeds of the bankruptcy estate's liquidation. CIRTRAN CORP: Extends Forbearance Agreement With YA Global ---------------------------------------------------------- CirTran Corporation has entered into an amended Forbearance Agreement with YA Global Investments, L.P. of Jersey City, N.J., which includes a new loan repayment schedule. Iehab J. Hawatmeh, CirTran's chairman and president, said his company "made significant progress in 2010 and early in 2011, primarily in continued increases in cash flow and worldwide sales of the Playboy-branded energy drinks manufactured and distributed by CirTran. "This growth," he said, "has enabled CirTran to be more pro-active in management of our debt. We have agreed to a debt payment schedule with Y.A. Global with which we are confident we can comply." CirTran made the first scheduled payment of $225,000 to YA Global last week on the effective date of the new agreement, he said, nothing that the repayment schedule includes monthly payment commitments by CirTran through December 31, 2011. The amended Forbearance Agreement relates to three debentures issued by CirTran to YA Global, formerly Cornell Capital Partners, LP: on May 26, 2005 for $3,750,000; on December 30, 2005 for $1,500,000 and on August 23, 2006 for $1,500,000. A previous Forbearance Agreement involving the three debentures was announced in August 2009. "CirTran is grateful for the continued support and confidence of Y.A. Global, as demonstrated by this agreement," he said. "With more financial stability, the company is better positioned to move forward and continue to build our Playboy-branded beverage business and other operations worldwide." On August 11, 2009, the Company and YA had entered into a prior forbearance agreement, pursuant to which the Company had agreed to make certain payments pursuant to the Financing Documents, and YA had agreed to forbear from enforcing certain of its rights under the Financing Documents. The current Forbearance Agreement amends and restates the Prior Agreement. The parties to the new Forbearance Agreement are the Company; YA; and the following subsidiaries of the Company: Racore Network, Inc.; Cirtran - Asia, Inc.; CIRTRAN BEVERAGE CORP.; Cirtran Media Corp.; Cirtran Online Corp.; Cirtran Products Corp.; and Cirtran Corporation (Utah). The new Forbearance Agreement notes certain events of default under the Financing Documents, and notes that the Company and the Guarantors had requested that YA forbear from enforcing its rights and remedies under the Financing Documents, and sets for the agreement between the Obligors and YA with respect to that forbearance. A copy of the Amended and Restated Forbearance Agreement, which contains the new repayment schedule, is available for free at http://is.gd/jS5s8u About CirTran Corporation West Valley City, Utah-based CirTran Corporation (OTC BB: CIRC) -- http://www.CirTran.com/-- markets and manufactures energy drinks under the Playboy brand pursuant to a license agreement with Playboy Enterprises, Inc. The Company also provides turnkey manufacturing services and products using various high-tech applications for electronics manufacturers in various industries. The Company's balance sheet at September 30, 2010, showed $15.69 million in total assets, $22.53 million in total liabilities, and a stockholders' deficit of $6.83 million. CLOVERLEAF ENTERPRISES: Penn Nat'l Buys Rosecroft for $10.25MM -------------------------------------------------------------- Hanah Cho, writing for The Baltimore Sun, reports that casino operator Penn National Gaming emerged Friday as the new owner of bankrupt Rosecroft Raceway. Penn National agreed to pay $10.25 million in cash for the harness track in an auction, outbidding Baltimore lawyer and Orioles owner Peter G. Angelos and one other unidentified bidder, said Michael J. Lichtenstein, the attorney representing the bankruptcy trustee, who oversaw the private sale. The purchase needs to be approved by the bankruptcy court. According to the report, Mr. Angelos was the "stalking-horse" bidder in the Rosecroft auction. He had agreed to buy the track for $9 million in cash, plus $5 million subject to a referendum expanding gambling at the facility, absent higher and better offers. Mr. Angelos will receive a $250,000 "breakup fee" and be repaid a $250,000 loan he made to Rosecroft, Mr. Lichtenstein said. About Cloverleaf Enterprises Cloverleaf Enterprises Inc. -- http://www.rosecroft.com/-- owned the Rosecroft Raceway, a harness track in Fort Washington, Maryland. The Company filed for Chapter 11 protection (Bankr. D. Md. Case No. 09-20056) on June 3, 2009, represented by Nelson C. Cohen, Esq., at Zuckerman Spaeder LLP in Washington, D.C. The Company estimated $10 million to $50 million in assets and $1 million to $10 million in debts in its Chapter 11 petition. In April 2010, Judge Paul Mannes denied a motion to sell the assets, saying the sale "primarily benefits" the track's sole shareholder. The Company's operations were halted in June 2010. In November 2010, the U.S. Trustee named James J. Murphy to serve as Cloverleaf's Chapter 11 trustee. CNL HOTELS: Said to Be Preparing Bankruptcy Filing -------------------------------------------------- The Wall Street Journal's Mike Spector and Eliot Brown report that CNL Hotels & Resorts Inc., is preparing for a possible bankruptcy filing ahead of Tuesday's deadline to repay about $1.5 billion in debt on five of those properties, according to people familiar with the matter. The $1.5 billion debt is part of $3.3 billion in total obligations spread across various tranches. Sources told the Journal CNL's new owners are continuing to negotiate with creditors in hopes of getting an extension on the debt. The sources said that as of mid-afternoon Monday, the new owners hadn't reached a deal on the extension with Midland Loan Services, which is overseeing a $1 billion securitized mortgage that comes due Tuesday. The remaining $500 million coming due Tuesday is held by three so-called mezzanine lenders-Five Mile, MetLife Inc. and Government of Singapore Investment Corp., according to people familiar with the situation. The Journal relates the talks remained fluid and were stretching into the evening Monday, and it was possible that an agreement would be reached to keep CNL out of bankruptcy court. The Journal relates the eight CNL resorts were purchased by a Morgan Stanley real-estate fund in 2007 but recently taken over by a group of creditors that includes hedge-fund firm Paulson & Co. and Winthrop Realty Trust and Capital Trust. The new owners were junior creditors until they foreclosed on the properties at an auction Friday. The Journal says Paulson didn't respond to a request for comment. A Morgan Stanley spokeswoman declined to comment. The CNL resorts are believed to be worth less than the outstanding debts from their purchase, according to the Journal. The Journal says any reworking of the existing loans would likely require investing new money to pay down the debt. People familiar with the matter told the Journal among those who have expressed interest in investing new money as equity holders are Morgan Stanley and Five Mile Capital, which owns a piece of the junior debt on the properties. CNL's hotel portfolio includes the Arizona Biltmore Resort & Spa in Phoenix, the Ritz-Carlton in Orlando, Fla. and Hawaii's Grand Wailea Resort Hotel & Spa in Maui. CODA OCTOPUS: Has $2.9MM Loss in Fiscal 2010; 10-K Delayed ---------------------------------------------------------- In a Form 12b-25 filing with the Securities and Exchange Commission on January 28, 2011, Coda Octopus Group, Inc., said that its annual report for the fiscal year ended October 31, 2010, cannot be filed within the prescribed time period because the Company requires additional time for compilation and review to insure adequate disclosure of certain information required to be included in the Form 10-K. The report will be filed on or before the fifteenth calendar day following the prescribed due date. The Company disclosed in the filing that it incurred a loss from operations of approximately $2,910,925 for the year ended October 31, 2010 against $$6,983,200 during the same prior year period. Removing non-cash and nonrecurring expenses, the comparison shows a loss from operations of $2,008,366 for the year ended October 31, 2010 against a similarly adjusted $3,893,726 loss for the same prior year period. This reduction in the loss is largely attributable to the Company's reduction program resulting in a reduction in the Company's SG&A across the Group. About Coda Octopus Coda Octopus Group, Inc., develops, manufactures, sells and services real-time 3D sonar and other products, as well as engineering design and manufacturing services on a worldwide basis. Headquartered in Jersey City, New Jersey, with research and development, sales and manufacturing facilities located in the United Kingdom, United States and Norway, the Company is engaged in software development, defense contracting and engineering services through subsidiaries located in the United States and the United Kingdom. The Company's balance sheet as of July 31, 2010, showed $12.9 million in total assets, $27.7 million in total liabilities, and a stockholders' deficit of $14.8 million. As of July 31, 2010, the Company had a working capital deficit of $20.2 million. For the nine month period ended July 31, 2010, the Company had negative cash flow from operations of $729,718. The Company also has an accumulated deficit of $61.1 million at July 31, 2010. CONNECTOR 2000: Ch. 9 Plan Confirmation Hearing Set for March 25 ---------------------------------------------------------------- The Hon. David R. Duncan of the U.S. Bankruptcy Court for the District of South Carolina will convene a hearing on March 25, 2011, at 10:00 a.m., prevailing Eastern Time, to consider the confirmation of Connector 2000 Association Inc.'s Plan for Adjustment of Debts as amended on January 17. Objections, if any, are due March 16. Written ballots accepting or rejecting the Plan are due 4:00 p.m. on March 4. As reported in the Troubled Company Reporter on January 24, the approval of the disclosure statement explaining the Plan was made possible by a settlement with the South Carolina Transportation Department. In July, the SCDT sought dismissal of the Chapter 9 case, because Connector 2000 is not a "municipality". The settlement avoided holding trial on eligibility for Chapter 9. The Plan deals with $224 million in senior bonds, $88 million in subordinated bonds, and $20 million in other liabilities. The Plan calls for giving the senior bondholders about $146 million in Tier 1 and Tier 2 bonds. The new bonds will mature between 2011 and 2051. Subordinated debt holders, if they vote for the plan, would receive $2.2 million in Tier 3 bonds. The revised Disclosure Statement says that the Tier 1 bonds will consume 71.5% of projected net revenue while the second-tier bonds take up 16.5% of net revenue. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/Connector2000_DS.pdf About Connector 2000 Piedmont, South Carolina-based Connector 2000 Association Inc., is a non-profit association set up by the South Carolina Department of Transportation to finance, construct and operate the 16-mile toll road known as the "Southern Connector" in Greenville County, and to build the South Carolina Highway 153 Extension. Connector 2000 filed for Chapter 9 bankruptcy protection on June 24, 2010 (Bankr. D. S.C. Case No. 10-04467), estimating both assets and debts to be between $100 million and $500 million. Judge David R. Duncan presides over the case. Stanley H. McGuffin, Esq., at Haynsworth Sinkler Boyd P.A., serves as bankruptcy counsel. COTTON 303: U.S. Trustee Unable to Form Creditors Committee ----------------------------------------------------------- The U.S. Trustee for Region 17 notified the U.S. Bankruptcy Court for the District of Nevada that he was unable to appoint an official committee of Unsecured Creditors in the Chapter 11 case of Cotton 303, LLC. Henderson, Nevada-based Cotton 303, LLC, filed for Chapter 11 bankruptcy protection on June 3, 2010 (Bankr. D. Nev. Case No. 10- 20380). Terry V. Leavitt, Esq., who has an office in Las Vegas, Nevada, assists the Company in its restructuring effort. The Company estimated assets at $10 million to $50 million and $1 million to $10 million. CRAFTMASTER PROPERTIES: Case Summary & Unsecured Creditor --------------------------------------------------------- Debtor: Craftmaster Properties, LLC 3045 S. Fremont #A Springfield, MO 65804 Bankruptcy Case No.: 11-60142 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Western District of Missouri (Springfield) Judge: Arthur B. Federman Debtor's Counsel: Raymond I. Plaster, Esq. RAYMOND I. PLASTER, P.C. 2032 E. Kearney, Suite 107 Springfield, MO 65803 Tel: (417) 831-6900 Fax: (417) 831-6901 E-mail: riplaster@rip-pc.com Scheduled Assets: $3,123,504 Scheduled Debts: $2,851,335 In its list of 20 largest unsecured creditors, the Company identified only one creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Collector of Revenue $15,596 Scott Payne 940 Boonville Ave Springfield, MO 65802-3888 The petition was signed by Tom Barr, managing member. CUMULUS MEDIA: Wallace R. Weitz Discloses 5.3% Equity Stake ----------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on January 28, 2011, each of Wallace R. Weitz & Company and Wallace R. Weitz disclosed beneficial ownership of 1,900,000 shares of common stock of Cumulus Media, Inc., representing 5.3% of the shares outstanding. As of October 26, 2010, the Company had 42,030,355 outstanding shares of common stock consisting of (i) 35,576,293 shares of Class A Common Stock; (ii) 5,809,191 shares of Class B Common Stock; and (iii) 644,871 shares of Class C Common Stock. About Cumulus Media Based in Atlanta, Georgia, Cumulus Media Inc. (NASDAQ: CMLS) -- http://www.cumulus.com/-- is the second largest radio broadcaster in the United States based on station count, controlling 350 radio stations in 68 U.S. media markets. In combination with its affiliate, Cumulus Media Partners, LLC, the Company believes it is the fourth largest radio broadcast company in the United States when based on net revenues. The Company's balance sheet at Sept. 30, 2010, showed $324.06 million in total assets, $673.31 million in total liabilities, and a stockholders' deficit of $349.25 million. Cumulus Media carries a 'Caa1' corporate family rating, and 'Caa2' probability-of-default rating from Moody's Investors Service. DIGITILITI INC: CEO Taghizadeh Added to Board of Directors ---------------------------------------------------------- Effective January 24, 2011, Digitiliti Inc.'s Board of Directors increased the size of the company's Board of Directors from five to six persons and elected Ehssan Taghizadeh, the Company's president and CEO, to fill the vacancy created. The Board has not decided at this time which committee Mr. Taghizadeh will be named to. Mr. Taghizadeh has served as the Company's President and CEO since October 4, 2010. About Digitiliti, Inc. St. Paul, Minnesota-based Digitiliti, Inc.'s business is developing and delivering storage technologies and methodologies enabling its customers to manage, control, protect and access their information and data with ease. The Company's core business is providing a cost effective on-line data protection solution to the small to medium business ("SMB") and small to medium enterprise ("SME") markets through its DigiBAK service. This on- line data protection solution helps organizations properly manage and protect their entire network from one centralized location. The Company's balance sheet at September 30, 2010, showed $1.6 million in total assets, $2.2 million in total liabilities, and a stockholders' deficit of $605,063. The Company has an accumulated deficit of $25.1 million as of September 30, 2010. MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has suffered losses from operations and has a working capital deficit. DILLARD'S INC: Moody's Affirms 'B2' Rating; Outlook Now Positive ---------------------------------------------------------------- Moody's Investors Service changed Dillard's, Inc. rating outlook to positive from stable. It also affirmed all of Dillard's existing ratings including its Corporate Family Rating and Probability of Default Rating at B2. The change in outlook to positive reflects Dillard's improved EBIT, driven by a modest growth in comparable store sales combined with higher gross margins from better inventory management and continued discipline with selling, general, and administrative expenses. The positive outlook also reflects Moody's view that Dillard's credit metrics will remain good which, with further clarity around financial policy, could lead to a higher rating. Dillard's B2 rating is constrained by the uncertainty around its medium to longer term capital structure and its future intentions with regard to its real estate investment trust subsidiary. Dillard's has good credit metrics, very good liquidity, and minimal near term debt maturities -- factors that would all support a higher rating. However, it recently announced that it has formed a REIT with the intention of enhancing its ability to access the debt or preferred stock markets. This raises the level of uncertainty around Dillard's financial policy and tolerance for incremental debt. Dillard's rating is also constrained by its history of inconsistent operating performance. The company has experienced a prolonged decline in comparable store sales which started in 2000. Although, comparable store sales for the first eleven months of 2010 have turned positive, they have been irregular and below its peers. Given this, Moody's remains concerned that Dillard's operating performance will continue to be inconsistent. In addition, while Dillard's operating margin has notably improved, it remains low and well below its department store peers. These ratings are affirmed: For Dillard's, Inc. -- Corporate Family Rating at B2 -- Probability of Default Rating at B2 -- Senior unsecured notes at B3 (LGD 4, to 68% from 59%) -- Subordinated notes at Caa1 (to LGD 6, 95% from LGD 5, 88%) For Dillard's Capital Trust I -- $200 million preferred stock at Caa1 (to LGD 6, 95% from LGD 5, 88%) The last rating action for Dillard's was on March 22, 2010 when its Probability of Default Rating was upgraded to B2 from B3. Ratings could be upgraded should Moody's become comfortable that Dillard's financial policy -- including transactions involving its REIT -- will be managed such that credit metrics remain at levels appropriate for a higher rating. An upgrade would also require that Dillard's maintains consistent operating performance at its current levels. Quantitatively, the company needs to maintain debt to EBITDA at or below 3.5 times and EBITA to interest expense at or above 2.0 times. Ratings could be downgraded if operating performance deteriorates such that EBITA to interest approaches 1.25 times or debt to EBITDA rises above 5.5 times. Ratings could also be downgraded should Dillard's liquidity become weak or should financial policy become increasingly aggressive including transferring further properties to the REIT. The principal methodologies used in this rating were Global Retail Industry published in December 2006, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Dillard's, Inc., is a regional department store chain operating 308 retail stores in 29 U.S. states with concentrations in the southwest, southeast and midwest. The company is headquartered in Little Rock, Arkansas. Revenues are about $6 billion. DIMENTSIONS BY DAN: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Dimensions By Dan, Inc. aka Dan Gutierrez 14523 Lee Road Houston, TX 77032 Bankruptcy Case No.: 11-30749 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Karen K. Brown Debtor's Counsel: Dawn Guilliams, Esq. THE ADAMS LAW FIRM 23501 Cinco Ranch Blvd., Suite H205 Katy, TX 77494 Tel: (281) 391-9237 Fax: (281) 391-0451 E-mail: dguilliams@adamslawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $100,001 to $500,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Daniel Gutierrez, president. DISH NETWORK: Fitch Affirms 'BB-' Issuer Default Rating ------------------------------------------------------- Fitch Ratings affirms the 'BB-' Issuer Default Rating assigned to DISH Network Corporation and its wholly owned subsidiary DISH DBS Corporation. Fitch has also affirmed the 'BB-' rating assigned to the senior unsecured notes issued by DDBS Corporation. Additionally, Fitch has revised DISH's Rating Outlook to Stable from Negative. As of Sept. 30, 2010, DISH had approximately $6.5 billion of debt outstanding. The Stable Outlook recognizes the operational rebound DISH has experienced during 2010. From Fitch's view, DISH's operating profile and competitive position continues to lag behind its peer group. However, strong ARPU growth has offset inconsistent subscriber additions trends and higher churn metrics leading to an acceleration of revenue growth. Additionally better operating efficiencies resulting in reduced operating costs related to customer service along with the operating leverage inherit in DISH's operating model have contributed to strong EBITDA generation and margin expansion. These factors combined have produced a relatively stable credit profile. Fitch believes that the operating trends are sustainable over the ratings horizon and that the current ratings have the capacity to accommodate operational inconsistency that can be expected given the company's weak competitive position. Overall, Fitch's ratings reflect the operating leverage derived from DISH's size and scale as the third largest multi-channel video programming distributor in the U.S. and Fitch's expectation for continued, albeit pressured free cash flow generation. DISH's operating profile is centered on its maturing video service offering and lacks the revenue diversity and revenue growth opportunities relative to its cable multiple system operator and growing telephone company competition. DISH's low-cost provider strategy addresses the value-sensitive segment of the market, and in Fitch's opinion DISH's position is increasingly difficult to defend as all the service providers have become more aggressive with pricing and service promotion discounts. In addition DISH's branding strategy tends to result in a less valuable subscriber base and a subscriber base that is more vulnerable to economic conditions. Rating concerns center on the evolving competitive landscape, DISH's lack of revenue diversity and narrow product offering relative to its cable MSO and growing network based telephone company video competition, and finally DISH's ability to balance subscriber growth with growing operating margins and free cash flow. The ratings also incorporate Fitch's belief that DISH's satellite based infrastructure can put the company at a competitive disadvantage, relative to the cable MSO and telephone company's respective technology and network positions, as video content is expected to be increasingly consumed over alternative platforms and devices such as wireless and higher-speed broadband networks. On a consolidated basis, total debt as of Sept. 30, 2010, was approximately $6.5 billion, relatively unchanged when compared with the $6.4 billion of debt outstanding as of year-end 2009 and 6.3% higher than total debt outstanding as of Sept. 30, 2009. Reflecting DISH's stabilizing operational profile, DISH's leverage profile has improved during the first nine months of 2010 as leverage has declined from 2.41 times (x) as of year-end 2009 to 2.18x as of the LTM period ending Sept. 30, 2010. Total debt outstanding during 2011 is expected to remain relatively consistent with year-end 2010 debt level of approximately $6.5 billion as a $1 billion scheduled maturity is expected to be refinanced. Fitch assumes that a stable operating profile during 2011 will lead to nominal improvement in DISH's overall credit profile and anticipates that DISH's leverage will be 2.1x as of year end 2011 before trending below 2.0x as of year end 2012. Given Fitch's expectations that DISH will continue generating relatively stable free cash flow over the near to medium term, DISH's capital allocation strategy is emerging as a key influence in the evolution of the company's overall credit profile. Considering the business risks attributable to DISH's operations and expected credit protection metrics, Fitch believes that the company's overall credit profile is relatively strong within the rating category, providing the company with sufficient financial flexibility to accommodate operational inconsistencies, adopt a more aggressive financial policy regarding the return of capital to shareholders and continue making strategic investments. Fitch believes that DISH's leverage can increase to a range between 3.5x and 3.75x and maintain its current ratings, absent any material competitive or operational changes. Fitch believes that DISH's liquidity position is strong given the current ratings and nominal scheduled maturities over the intermediate term. The company's liquidity position is supported by cash and marketable securities on hand and expected free cash flow generation. As of Sept. 30, 2010, DISH had a total of approximately $2.6 billion of cash and marketable securities -- relatively consistent with liquidity measures as of Sept. 30, 2009, and year-end 2009. Fitch does note, however, that the company does not maintain a revolver, which increases DISH's reliance on capital market access to refinance current maturities, elevating the refinancing risk within the company's credit profile. However, the current cash and marketable securities balance is more than sufficient to address approximately $1.5 billion of maturities scheduled through 2013, including approximately $1 billion in 2011. The uncertain cash requirements related to DISH's ongoing litigation with TIVO, Inc. also adds risk to DISH's liquidity position. Free cash flow generation during the first nine months of 2010 declined by nearly 40% relative to the same period last year to approximately $701 million. Stronger EBITDA contributions during the first nine months of 2010 have been offset by higher levels of capital expenditures and increased interest and tax payments. Fitch expects capital intensity will be relatively consistent over the near term and that capital expenditures will continue to focus on subscriber retention and capitalized subscriber premises equipment. Fitch anticipates that DISH will continue generating relatively stable levels of free cash flow during the current ratings horizon while incorporating higher levels of cash taxes. Positive rating actions would likely coincide with the company committing to a financial strategy and policy that would result in a capital structure consistent with a higher rating. Negative rating action would be contemplated if, among other things, financial policy initiatives compel the company to increase leverage beyond 3.5x, or if a potential legal settlement with Tivo materially changes DISH's competitive position or weakens the company's liquidity position or credit profile. Fitch has affirmed the following ratings with a Stable Rating Outlook: DISH Network Corporation -- IDR at 'BB-'. DISH DBS Corporation -- IDR at 'BB-'; -- Senior unsecured notes at 'BB-'. EASTLAND PLAZA: Case Summary & 2 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Eastland Plaza LLC 5965 W. Washington Boulevard Culver City, CA 90232 Bankruptcy Case No.: 10-13564 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Vincent P. Zurzolo Debtor's Counsel: Robert S. Altagen, Esq. LAW OFFICES OF ROBERT S. ALTAGEN 1111 Corporate Center Drive, #201 Monterey Park, CA 91754 Tel: (323) 268-9588 Fax: (323) 268-8742 E-mail: rsaink@earthlink.net Scheduled Assets: $1,595,000 Scheduled Debts: $1,389,763 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb11-13564.pdf The petition was signed by Daniel Rafalian, managing member. ESCO CORP: S&P Withdraws 'B+' Credit Rating at Firm's Behest ------------------------------------------------------------ Standard & Poor's Rating Services withdrawn its 'B+' corporate credit rating on ESCO Corp. at the Company's request. EURENERGY RESOURCES: Chapter 11 Case Transferred to Dallas ---------------------------------------------------------- The U.S. Bankruptcy court for the District of Nevada, Las Vegas Division, entered an order transferring Eurenergy Resources Corporation's Chapter 11 case to Dallas (Bankr. N.D. Texas Case No. 11-30551). The transfer was made effective January 26, 2011. Dallas, Texas-based Eurenergy Resources filed for Chapter 11 protection (Bankr. D. Nev. Case No. 10-18071) in Las Vegas on May 3, 2010. The Debtor estimated up to $10 million in assets and up to $50 million in debts in its Chapter 11 petition. Bruce Thomas Beesley on behalf of Carlton Energy Group, LLC, filed the change-of-venue motion, according to the docket. Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, in Las Vegas, represents the Debtor. EVANS OIL: Files for Chapter 11 in Ft. Myers, Florida ----------------------------------------------------- Evans Oil Company LLC and six affiliates filed for Chapter 11 protection on January 30, 2011 in Ft. Myers, in Florida (Bankr. M.D. Fla. Lead Case No. 11-01515). Naples, Florida-based Evans Oil and its affiliates provide Chevron-franchised service stations, retailers and other customers with their requirements of various petroleum products, including bulk oil, gas, diesel and lubricant products. Its affiliated debtors include an equipment-leasing company, a convenience store and service station operator and a charter company. In 2010, the Debtors transported 50 million gallons of petroleum products, generated revenues of $120,000,000 and EBITDA in excess of $3,500,000. As of Jan. 27, 20011, the Debtors reported assets of $32,378,783 and liabilities of $44,149,620. Evans' principal working capital and secured lender is Fifth Third Bank, which provides various credit facilities. Presently, Evans owes Fifth Third Bank approximately $34,000,000. Evans says it is substantially current with its suppliers, taxes, payroll and other creditors. The Debtors did not file an affidavit that would detail events leading to the Chapter 11 filing. The Debtors said in a court filing that they are seeking Chapter 11 protection "in order to continue operations." EVANS OIL: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Evans Oil Company LLC aka Evans Oil Co LLC 3170 S. Horseshoe Drive Naples, FL 34104 Bankruptcy Case No.: 11-01515 Chapter 11 Petition Date: January 30, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Ft. Myers) Debtor's Counsel: John S. Sarrett, Esq. HAHN LOESER & PARKS LLP 800 Laurel Oak Drive, Suite 600 Naples, FL 34108 Tel: (239) 254-2955 E-mail: jsarrett@hahnlaw.com -- and -- Lawrence E. Oscar, Esq. Daniel A. DeMarco, Esq. Christopher B. Wick, Esq. Emily W. Ladky, Esq., HAHN LOESER & PARKS LLP 200 Public Square, Suite 2800 Cleveland, Ohio 44114 Tel: (216) 621-0150 Fax: (216) 241-2824 E-mail: leoscar@hahnlaw.com Dademarco@hahnlaw.com cwick@hahnlaw.com eladky@hahnlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- KCWL, LLC 11-01519 01/30/11 Long Equipment Finance, LLC 11-01520 01/30/11 Long Petroleum Products 11-01521 01/30/11 Long Run, LLC 11-01522 01/30/11 Octane, LLC 11-01523 01/30/11 RML, LLC 11-01524 01/30/11 The petitions were signed by Randy M. Long, manager. Evans Oil's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Chevron Products Company Fuel $2,450,814 6001 Bollinger Canyon Road San Ramon, CA 94583 TransMontaigne Fuel $1,834,252 P.O. Box 5660 Denver, CO 80217-5660 World Fuel Services Fuel $125,355 9800 N.W. 41st Street, Suite 400 Miami, FL 33178 Chevron Petroleum Marketers Oil Purchases $103,600 Clearing Valvoline Oil Purchase $85,517 Total Lubricants Oil Purchasing $77,435 Clearing American Express Open Account $59,450 JMP Solutions, Inc. Trade $46,317 Valero Fuel $29,274 United of Omaha Life Ins. Insurance $16,460 FCCI Insurance Co. Insurance $11,969 Atlantic Coastal Fuels, Inc. Fuel $11,711 Federated Insurance Life Insurance $9,672 Port Consolidated Fuel Expense $8,562 Tropic Oil Co. Oil $8,067 Bluecross Blueshield of Fla. Insurance $7,016 Prudential Insurance $5,588 Neiert Consulting Group Professional Services $5,506 Palm Peterbilt Trade $3,639 Coleman, Hazzard & Taylor Professional Services $3,333 EVERGREEN SOLAR: Unveils Alterations to Debt-Exchange Offer ----------------------------------------------------------- Dow Jones' DBR Small Cap reports that Evergreen Solar Inc. has revamped its debt-exchange offer, hoping to get investors on board for a proposal that it said will "substantially reduce" the company's liabilities. As reported by the Troubled Company Reporter on December 10, 2010, Evergreen Solar's Board of Directors has approved a comprehensive recapitalization plan to align the company's capital structure with its current business model and to better position Evergreen Solar for future growth. The recapitalization plan, if fully executed, will: -- Substantially reduce the company's outstanding indebtedness and annual interest expense; -- Exchange a substantial portion of the company's existing convertible debt for new debt with longer maturities and lower conversion prices; -- Create a capital structure that should provide greater incentive to convertible debt holders to convert their notes into shares of the company's common stock, which would further accomplish Evergreen Solar's goal of substantially reducing outstanding debt; and -- Enhance the company's flexibility to manage its business by eliminating certain restrictive covenants and the security interests contained in existing debt instruments. The recapitalization plan is comprised of these key elements: -- Exchange offers and a consent solicitation; -- Raising additional capital by seeking to sell up to $40,000,000 aggregate principal amount of Evergreen Solar's new 4% Convertible Subordinated Additional Cash Notes due 2020; -- Implementing the 1-for-6 reverse stock split previously approved by Evergreen Solar's stockholders at the company's annual meeting on July 27, 2010, which will become effective prior to the closing of the exchange offers; and -- Increasing Evergreen Solar's authorized shares of common stock from 120,000,000 to 240,000,000 shares (after giving effect to the reverse stock split), in order to ensure that the company has sufficient shares available for future issuances. Marlboro, Massachusetts, December 6, 2010 - Evergreen Solar, Inc. (NasdaqGM: ESLR) -- http://www.evergreensolar.com/-- develops, manufactures and markets String Ribbon(R) solar power products using its proprietary, low-cost silicon wafer technology. FIN'L RESOURCES MORTGAGE: SEC Halts Ponzi Probe, Issues Orders -------------------------------------------------------------- Bob Sanders, writing for New Hampshire Business Review, reported that the U.S. Securities and Exchange Commission has ceased its investigation of Financial Resources Mortgage Inc., the defunct business at the heart of New Hampshire's biggest Ponzi scheme. NHBR reports the SEC has proposed orders enjoining FRM and its affiliate mortgage servicing company CL&M, and their principals, Scott Farah and Donald Dodge, from engaging in fraud again. The report notes the order does not ask for any damages from the bankrupt company, leaving the Bankruptcy Court in New Hampshire to figure out how much money -- if any -- the Company's lenders or investors should get. NHBR says all parties agreed to submit to the SEC order, without admitting or denying the original allegations. The U.S. District Court also has signed off on the order. NHBR also reports the SEC is dropping its case against Center Harbor Christian Church, run by Scott Farah's father Bob Farah, deferring to the bankruptcy court adversary proceeding against the church. The adversary complaint was filed in April 2010, when the SEC sought to freeze the church's assets, alleging that the defendants transferred $669,000 in assets to the church over the years, even though the money was supposed to go to specific investments. The report relates that in the criminal case against Messrs. Dodge and Farah, U.S. District Court Judge Paul Barbadoro appeared willing to defer any action of restitution to the bankruptcy court, although he did not issue a final decision on the matter. During that hearing, Judge Barbadoro sentence Mr. Farah to 15 years and Mr. Dodge to 6-1/2 years. Financial Resources Mortgage a/k/a Financial Resources & Assistance of The Lakes Region, Inc., a/k/a Financial Resources National, Inc.; and C L & M, Inc., a/k/a Commercial Project Loan Servicing filed for Chapter 7 bankruptcy (Bank. D. N.H. Case No. 09-14565). Steven M. Notinger, Esq., has been appointed Chapter 7 Trustee. Other affiliated entities are also in separate Chapter 7 proceedings: Scott David Farah (Bankr. D. N.H. Case No. 09-14902); SMM 2007 Realty Trust (Bankr. D. N.H. Case No. 09-14903); and Dodge Financial, Inc. (Bankr. D. N.H. Case No. 10-10278). The Chapter 7Trustee may be reached at: Steven M. Notinger, Esq. DONCHESS & NOTINGER, PC 547 Amherst Street Nashua, New Hampshire 03063 E-mail: steve@dntpc.com FIRST FEDERAL: Bear State to Invest $55 Million ----------------------------------------------- First Federal Bancshares of Arkansas, Inc., announced that it has entered into a definitive investment agreement with Bear State Financial Holdings, LLC, pursuant to which Bear State will invest up to $55 million in the Company and its banking subsidiary, First Federal Bank. As part of the recapitalization plan set forth in the definitive investment agreement, the Company also intends to conduct a rights offering following an initial closing of the investment by Bear State. The rights offering will allow existing shareholders to purchase the Company's common stock at the same purchase price per share paid by Bear State. The investment by Bear State is subject to the approval of the Company's shareholders and the Office of Thrift Supervision and certain other conditions related to the investment, including, among others, the consummation by the Company of a 1-for-5 reverse stock split of its common stock. The Company, the Bank and Bear State expect to close the initial investment in the 2nd quarter of 2011. "This recapitalization plan will benefit our shareholders, depositors and employees," said Larry J. Brandt, president and chief executive officer of the Company. "The additional capital provided by Bear State and through the shareholder rights offering will allow us to comply with the capital requirements of our regulatory order, stabilize our banking operations as well as grow our business so that we are positioned to attract new depositors and increase our loan portfolios. This is tremendous news for First Federal and the communities we serve across northern Arkansas." Under the terms of the definitive investment agreement, Bear State will initially purchase approximately $40.3 million of the Company's common stock at a price of $0.60 per share. Bear State also anticipates purchasing from the United States Department of the Treasury the preferred stock and warrants the Company previously issued to the Treasury under the Troubled Asset Relief Program - Capital Purchase Program for $6 million and delivering the same to the Company in return for additional shares of the Company's common stock. In addition, the Company will issue to Bear State a warrant to purchase an additional $6 million of the Company's common stock. Following this initial investment, the Company plans to initiate a rights offering to its shareholders as of a record date to be established by the Company's Board of Directors. The rights offering will allow these shareholders to purchase up to approximately $8.7 million of the Company's common stock at the same per share price offered to Bear State. Bear State has agreed to purchase any unsubscribed shares at the same per share price offered to existing shareholders. Other details relating to the rights offering, including the record date, will be determined and disclosed at a later date. Prior to the initial investment by Bear State, the Company will consummate a 1-for-5 reverse stock split of its common stock. The per share price being paid by Bear State in connection with its investment, and the Company's shareholders in connection with the rights offering, after giving effect to the reverse stock split, is $3.00 per share of the Company's common stock. The investment in the Company and subsequent contribution of substantially all of the net proceeds to the Bank will place the Bank's capital ratios well in excess of the capital required by applicable regulations of the OTS and the Bank's 2009 Cease and Desist Orders with the OTS. The Company believes that once the recapitalization is completed, First Federal Bank will be among the most well-capitalized banks in Arkansas. Bear State was organized by Arkansas-based Westrock Capital Partners, LLC in order to facilitate the investment in the Company by a group of individual investors from across Arkansas. Rick Massey, who is a partner in Westrock Capital Partners, serves as the Chairman of Bear State. Dabbs Cavin is expected to join the senior executive team of the Company and the Bank following the closing of Bear State's initial investment. Mr. Cavin has been active in commercial banking in a variety of executive positions for more than 20 years, including start-ups and expansions into new markets. He formerly served as an examiner for the precursor to the OTS, executive vice president and chief lending officer of Pinnacle Bank, president of the Little Rock market for BancorpSouth following its acquisition of Pinnacle, and executive vice president of Summit Bank. "I am really excited about the opportunity that is ahead of us thanks to the strong growing communities in which First Federal operates and thanks to First Federal's outstanding customers. It will require hard work and, together with the team of professional bankers at First Federal, we believe we will be able to work through our troubled assets and grow loans in an effort to return First Federal to profitability." Cavin said. About First Federal Bancshares of Arkansas First Federal Bancshares of Arkansas, Inc. (NASDAQ GM:FFBH) -- http://www.ffbh.com/-- is a unitary savings and loan holding company for First Federal Bank, a community bank serving consumers and businesses with a full range of checking, savings, investment and loan products and services. The Bank, founded in 1934, conducts business from 20 full-service branch locations, one stand-alone loan production office, and 30 ATMs located in Northcentral and Northwest Arkansas. The Company's balance sheet at Sept. 30, 2010, showed $632.34 million in total assets, $592.88 million in total liabilities, and stockholders' equity of $39.46 million. At June 30, 2010, the Company was above the regulatory minimums for tangible, core, total risk-based and tier 1 risk-based capital. On April 12, 2010, the Company and the Bank each consented to the terms of Cease and Desist Orders issued by the Office of Thrift Supervision. The Orders impose certain operations restrictions on the Company and, to a greater extent, the Bank, including lending and dividend restrictions. The Orders also require the Company and the Bank to take certain actions, including the submission to the OTS of capital plans and business plans to, among other things, preserve and enhance the capital of the Company and the Bank and strengthen and improve the consolidated Company's operations, earnings and profitability. The Bank Order specifically requires the Bank to achieve and maintain, by December 31, 2010, a tier 1 (core) capital ratio of at least 8% and a total risk-based capital ratio of at least 12.0% and maintain these higher ratios for as long as the Bank Order is in effect. At June 30, 2010, the Bank's core and total risk-based capital ratios were 6.46% and 11.40%. Had the Bank been required to meet these capital requirements at June 30, 2010, it would have needed additional capital of approximately $10.5 million. As reported in the Troubled Company Reporter on April 21, 2010, Deloitte & Touche LLP, in Little Rock, Ark., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted of the Company's significant operating losses in 2009, significant levels of criticized assets, and decline in capital levels. First Federal reported a net loss of $5.36 million on $7.01 million of total interest income for the three months ended Sept. 30, 2010, compared with a net loss of $23.23 million on $8.69 million of total interest income for the same period the prior year. FORD MOTOR: Reports $6.60 Billion Net Income in 2010 ---------------------------------------------------- Ford Motor Company reported 2010 full year net income of $6.6 billion, or $1.66 per share, an increase of $3.8 billion, or 80 cents per share, from 2009. This was Ford's highest net income in more than 10 years, as strong products and new investments fueled improvements in all of the company's business operations around the world. Revenue was $32.5 billion in the fourth quarter and $120.9 billion for the full year, an increase of $17 billion from full year 2009, excluding Volvo from 2009. "Our 2010 results exceeded our expectations, accelerating our transition from fixing the business fundamentals to delivering profitable growth for all," said Alan Mulally, Ford president and CEO. "We are investing in an unprecedented amount of products, technology and growth in all regions of the world." Full year 2010 pre-tax operating profit was $8.3 billion, or $1.91 per share, an increase of $8.3 billion, or $1.90 per share, from a year ago. This increase reflects a profit in each Automotive segment led by strong performance in North America, reflecting primarily favorable volume and mix as well as favorable net pricing. Ford Credit's strong profit also contributed significantly to Ford's full year performance. Ford made significant progress in strengthening its balance sheet, reducing Automotive debt by $14.5 billion in 2010, a 43% reduction. These actions will lower annualized interest expense by more than $1 billion. Ford finished the year with Automotive gross cash exceeding debt by $1.4 billion. Fourth quarter actions reduced Automotive debt by $7.3 billion, including $2.5 billion of newly announced debt reductions to pay down Ford's revolving credit facility and term loans. Ford reported fourth quarter net income of $190 million, or 5 cents per share, a decrease of $696 million, or 20 cents per share, from the fourth quarter of 2009. This includes the negative impact of special items of $1 billion, primarily associated with a previously disclosed $960 million charge related to the completion of debt conversion offers that reduced outstanding Automotive debt by over $1.9 billion. Ford earned a pre-tax operating profit of $1.3 billion, or 30 cents per share, in the fourth quarter, marking the sixth consecutive quarter of pre-tax operating profit. This is a decrease of $322 million, or 13 cents per share, from the fourth quarter of 2009. A full text copy of the press release on Ford's fourth quarter results is available for free at http://is.gd/b9OGXy About Ford Motor Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles across six continents. With about 200,000 employees and about 90 plants worldwide, the company's automotive brands include Ford, Lincoln, Mercury and Volvo. The Company provides financial services through Ford Motor Credit Company. Ford Motor's balance sheet at Sept. 30, 2010, showed $177.07 billion in total assets, $178.81 billion in total liabilities, and a stockholders' deficit of $1.77 billion. * * * As reported by the Troubled Company Reporter on October 12, 2010, Moody's Investors Service raised the Corporate Family Rating of Ford Motor to 'Ba2' from 'B1'. Other ratings that were raised include Probability of Default to 'Ba2' from 'B1'; senior secured credit facility to 'Baa3' from 'Ba1'; senior unsecured to 'Ba3' from 'B2'; and, preferred stock to B1 from B3. Moody's also raised the CFR and senior unsecured ratings of Ford Motor Credit Company LLC, FCE Bank Plc, and Ford Credit Canada Limited to Ba2 from Ba3. The rating outlook for Ford and Ford Credit is stable. Moody's said Ford's operating performance exceeded expectations during the first half of 2010. Moody's believe that Ford is well positioned to continue generating strong earnings and cash flow through 2011, and to further strengthen its balance sheet. Ford's ability to achieve this progress will be supported by the much healthier industry fundamentals that have resulted from the extensive restructuring of the US automotive sector during the past two years, and by Ford's highly competitive product portfolio. As reported by the TCR in August 2010, Dominion Bond Rating Service upgraded the Issuer Rating of Ford Motor to BB (low) from B; Fitch Ratings upgraded Ford's and Ford Motor Credit's Issuer Default Ratings to 'BB-' from 'B'; and Standard & Poor's Ratings Services raised its corporate credit rating on Ford Motor and Ford Motor Credit LLC to 'B+' from 'B-'. The rating agencies cited Ford's strong financial performance and substantial debt reduction accomplished in the second quarter of 2010. FORD MOTOR: Fitch Upgrades Issuer Default Rating to 'BB' -------------------------------------------------------- Fitch Ratings upgraded the Issuer Default Ratings for Ford Motor Company and its Ford Motor Credit Company LLC captive finance subsidiary to 'BB' from 'BB-'. The Rating Outlook for both Ford and Ford Credit is Positive. Ford's ratings reflect its continued strong financial performance and the substantial debt reduction accomplished in the fourth quarter, both of which outperformed Fitch's previous expectations. Although U.S. industry sales of 11.6 million units in 2010 was relatively low compared to what was seen prior to the recession, increased pricing and an improved cost structure have allowed Ford to produce strong automotive cash flow. This has been used, in turn, to substantially reduce the company's debt load, which declined by $7.3 billion in the fourth quarter. In 2011, Fitch expects Ford's competitive product portfolio and increased global automotive demand to drive free cash flow higher, supporting liquidity growth and providing additional opportunities to further de-lever the company's balance sheet. Challenges remain, however, including continued weakness in the European auto market, aggressive industry competition, continued global manufacturing overcapacity, rising oil prices and upcoming labor negotiations in the U.S. In addition, the potential remains for the recovery in the U.S. and European economies to slow or reverse, which could negatively affect industry auto demand. In general, though, Fitch expects Ford to be well positioned to meet most of these challenges over the medium term. Previously, Fitch has cited the following factors as rationale for a potential upgrade of Ford's ratings: -- U.S. industry sales seasonally adjusted annual rate (SAAR) rebounds to an annualized level of 13 million-13.5 million units, which Fitch expects to be achieved later this year; -- Ford's products continue to hold or gain market share; -- Inventory management at both Ford, and within the U.S. industry, allows Ford to hold or improve product prices, supporting margin performance; -- Positive free cash flow is achieved and continues on an upward trajectory; -- The pace of balance sheet strengthening through debt reduction accelerates; -- Ford Credit maintains or improves competitive access to capital. Fitch's industry forecast for 2011 calls for full-year U.S. auto sales of 12.5 million, up 8.2% from the 11.6 million level seen in 2010. U.S. SAAR could hit the 13 million level over the course of the year, however, and rise further in 2012 and beyond. Ford's product portfolio performed well in 2010, gaining U.S. market share for the second year in a row, and the company's product line-up for 2011, which includes completely new versions of the Focus compact and Explorer sport utility vehicle, is likely to help support the share position this year. These new products, along with refreshed versions of the Edge crossover and F-150 pickup, also are expected to support continued net pricing and margin strength in 2011. Strong net pricing and a lower cost base contributed to a Fitch- calculated automotive EBITDA margin of over 10% in 2010, and Fitch expects that figure could grow slightly in 2011. Increased margins led to free cash flow that improved significantly in 2010, with Fitch's calculation of free cash flow rising to an estimated $3.2 billion for the full year, up from negative free cash flow of ($454) million in 2009. In 2011, Fitch expects free cash flow to remain positive, but it could decline somewhat from 2010's level as capital spending grows to support new product development. Ford Credit is expected to continue enjoying the relatively good access to capital that it had in 2010. Last year, the financing unit saw increased access to the unsecured bond market, and Fitch does not see its access to this market waning in the intermediate term. Overall, Fitch expects Ford to continue making progress in 2011 on each of the items noted above. Over the course of 2010, Ford reduced its automotive debt by $14.5 billion to a total of $19 billion at year-end 2010 from $34 billion at Dec. 31, 2009, largely through a combination of prepayments and equity conversions on the company's convertible notes. During the fourth quarter, Ford repaid the remaining $3.6 billion of its note obligation to the United Auto Workers' Voluntary Employee Beneficiary Association retiree healthcare trust. The company also repaid $1.7 billion of the remaining $2.5 billion outstanding on its revolving credit facility, and it reduced the amount outstanding on its term loan by about $800 million. In addition, during the quarter it paid $534 million in cash premiums to induce holders of its convertible notes due in 2016 and 2036 to convert a portion of their holdings to equity, resulting in a further debt reduction of $1.9 billion. Looking ahead, Fitch expects the company to continue seeking opportunities to reduce its outstanding debt over the intermediate term, although the rate of debt reduction likely will slow as opportunities for prepayments and debt-to-equity conversions will be more limited. Fitch expects the most likely opportunities for further debt reduction, beyond upcoming debt maturities, would involve pre-paying the remaining bank debt outstanding and, perhaps, seeking conversion of a portion of the company's $3 billion in convertible subordinated debentures. Potentially offsetting a portion of the debt reduction would be any additional borrowings from the U.S. Department of Energy's Advanced Technology Vehicle Manufacturing Program. Ford has been approved for up to $5.9 billion in borrowings from the program, but as of year-end 2010, it had borrowed only about $3 billion, suggesting that borrowings could rise by up to $2 billion over the next several years if the company chooses to utilize the full amount approved. The improved market environment, increased competitiveness of Ford's products, lower cost structure and reduced debt load have all resulted in a substantial strengthening of the company's credit profile over the past year. Fitch calculates that Ford ended 2010 with EBITDA leverage of 1.8 times (x) and fixed charge coverage of 9.0x. As noted earlier, free cash flow for the year was a Fitch-estimated $3.2 billion after capital spending of $4 billion. In addition, Ford received $2.7 billion in dividends and other proceeds from Ford Credit. Ford ended the year with a cash balance of over $20 billion, down from about $25 billion at year-end 2009, but total liquidity, including availability on the company's primary revolving credit facility, increased to nearly $28 billion from about $26 billion at year-end 2009. Notably, Ford ended 2010 with a cash balance that exceeded its debt outstanding by $1.4 billion. Fitch currently expects Ford's credit profile to strengthen further during 2011 due to a continuation of many of the same factors that contributed to the improvement in 2010, including additional debt reduction. Leverage is likely to decline further over the course of 2011, while coverage is expected to rise. The pace of change is expected to slow from 2010's level, however, as the rate of improvement in global auto market conditions stabilize. Total liquidity is expected to remain at or above the year-end 2010 level, and Fitch expects the company will produce positive free cash flow once again, even with an increase in capital spending to the company-projected range of $5 billion to $5.5 billion. Despite the dramatic positive change seen in Ford's credit profile over the past year, significant risks remain. These risks include a still-high debt load, as well as significant pension and OPEB obligations, although the latter was reduced heavily with the 2009 VEBA agreement. As of year-end 2010, Ford's global pension plans were underfunded by $11.5 billion, with $6.7 billion of that in the U.S. The company was not required to make any contributions to its U.S. pension plans in 2010, but it contributed a total of $1.4 billion to its global plans during the year, including about $400 million in contributions to unfunded plans outside of the U.S. Pension contribution requirements could rise materially in the future if asset returns or market interest rates are unfavorable, although Fitch expects that Ford's liquidity will be sufficient to cover any increased contributions in the intermediate term. Ford's ratings also incorporate the continued uncertainty regarding the strength and pace of the global economic recovery. Although Fitch expects the U.S. economic recovery to continue through the next several years, high unemployment and ongoing housing weakness will constrain the rate of growth. Conditions in Europe are more uncertain, as increased fiscal tightening could weaken auto demand. The highly competitive European auto market has been characterized by very aggressive pricing following the end of government-sponsored scrappage programs, and additional fiscal tightening could further challenge the profitability of Ford's operations there. Also pressuring Ford's ratings in the near term is the upcoming labor negotiations between Ford and the UAW. Ford's contract with the UAW expires in September of this year. The union already has stated publicly its desire to claw back some of the concessions it agreed to when the industry was on the brink of collapse. Although Fitch expects all three Detroit automakers will seek to tie compensation more closely with profitability, the negotiations are likely to be difficult, and labor costs could rise with the ratification of a new agreement. It also is important to note that Ford's current labor agreement does not include the 'no strike' provisions contained in the UAW's agreements with GM and Chrysler, which could become an issue for Ford if negotiations with the union deteriorate later this year. Ford's senior secured credit facility and term loan ratings are rated two notches above the IDR at 'BBB-' to reflect the substantial collateral coverage backing those facilities. The senior unsecured rating is one notch below the IDR at 'BB-' to reflect the substantial portion of the company's debt structure that is secured and therefore has priority over the unsecured debt. The rating on the subordinated convertible debentures is two notches below the IDR at 'B+', reflecting the subordinated convertible debentures' lowest priority position in the company's debt structure. Ford's ratings could be upgraded in the intermediate term if the company continues to make progress on leverage reduction while maintaining a strong liquidity position. This most likely would be accomplished by continued improvement in external market conditions, combined with an ability to at least maintain both market share and net pricing strength. On the other hand, Ford's ratings could be downgraded if external market conditions weaken significantly, resulting in weakened free cash flow, a decline in liquidity and an increase in leverage. This situation would require a significant reversal of current market trends, and is unlikely in the medium term unless triggered by an unexpected event. Fitch also could take a negative rating action if a prolonged strike were to occur following a breakdown in labor negotiations. The upgrade of Ford Credit and its related subsidiaries reflects the strong linkage between the ratings of Ford Credit and Ford. In addition, the ratings also reflect Ford Credit's improved funding access to secured and unsecured markets, consistent operating performance, solid asset quality in the underlying loans and lease portfolio, and improved capital and liquidity position. The one notch differential between the long-term IDR and the senior unsecured debt rating of Ford Credit reflects Fitch's view that securitized debt currently comprises a higher portion of total debt compared to historical levels, which results in relatively lower level of unencumbered assets available to unsecured bondholders. Fitch does recognize the company's efforts to improve the funding mix from secured versus unsecured and notes that the ratings could be equalized over the longer term as the funding mix shifts more towards unsecured funding. Fitch has taken the following rating actions: Ford Motor Company -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Senior secured credit facility upgraded to 'BBB-' from 'BB+'; -- Senior secured term loan upgraded to 'BBB-' from 'BB+'; -- Senior unsecured upgraded to 'BB-' from 'B'. Ford Motor Co. Capital Trust II -- Subordinated convertible debentures upgraded to 'B+' from 'B-'. Ford Motor Co. of Australia -- Long-term IDR upgraded to 'BB' from 'BB-'. Ford Motor Credit Company LLC -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Short-term IDR affirmed at 'B'; -- Senior unsecured affirmed at 'BB-'; -- Commercial paper (CP) affirmed at 'B'. Ford Credit Europe Bank Plc -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Short-term IDR affirmed at 'B'; -- Senior unsecured affirmed at 'BB-'; -- CP affirmed at 'B'; -- Short-term deposits affirmed at 'B'. Ford Capital B.V. -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Senior unsecured affirmed at 'BB-'. Ford Credit Canada Ltd. -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Short-term IDR affirmed at 'B'; -- Senior unsecured affirmed at 'BB-'; -- CP affirmed at 'B'. Ford Credit Australia Ltd. -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Short-term IDR affirmed at 'B'; -- CP affirmed at 'B'. Ford Credit de Mexico, S.A. de C.V. -- Long-term IDR upgraded to 'BB' from 'BB-'. Ford Credit Co. S.A. de C.V. -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Senior unsecured affirmed at 'BB-'. Ford Motor Credit Co. of New Zealand Ltd. -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Short-term IDR affirmed at 'B'; -- Senior unsecured affirmed at 'BB-'; -- CP affirmed at 'B'. Ford Motor Credit Co. of Puerto Rico, Inc. -- Short-term IDR affirmed at 'B'. Ford Holdings, Inc. -- Long-term IDR upgraded to 'BB' from 'BB-'; -- Senior unsecured upgraded to 'BB-' from 'B'. FORD MOTOR: Moody's Affirms 'Ba2' Rating; Outlook Now Positive -------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Ford Motor Company and Ford Motor Credit Company and changed the rating outlook to positive from stable. These ratings include for Ford: Corporate Family Rating and Probability of Default Rating (PDR) -- Ba2; senior unsecured -- Ba3; secured credit facility -- Baa3; and Speculative Grade Liquidity rating -- SGL-2; and for Ford Credit: CFR and senior unsecured -- Ba2. Ford's positive outlook reflects Moody's expectation that the company will make further progress in strengthening its credit metrics, and that this progress could support a rating upgrade during the next 12 to 18 months. The improvement in Ford's financial profile will be driven by the increasing competitiveness of its product portfolio in the US, the growing likelihood that US automotive shipments will rise from 11.6 million units in 2010 to approximately 13 million units in 2011, and the impact of the $14.5 billion debt reduction that Ford achieved during 2010. Much of this debt reduction took place during the latter half of 2010, and a full-year impact of significantly reduced interest expense will not be evident until later in 2011. Primary considerations in Ford Credit's outlook change to positive are its strategic importance to Ford and Ford's explicit and implicit support of its finance unit. "Ford is outpacing Ford Credit in terms of improving its stand-alone credit strength, which makes Ford's support of Ford Credit an increasingly prominent rating consideration," said Moody's senior analyst Mark Wasden. "Ford's ability to support Ford Credit, should it be required, is strengthened as Ford's own operating prospects improve," he added. Ford's 2010 full-year automotive earnings increased by $7.2 billion. Moody's expects the pace of improvement in earnings and cash generation to moderate during 2011 due, in part, to headwinds posed by rising commodity prices, new vehicle launch costs, and weak automotive demand in Europe. Nevertheless, Moody's anticipates that Ford will remain on track for strengthening its credit profile. The most significant challenge facing Ford is the need to negotiate a new UAW contract in September. The current contract provided the US auto industry with concessions that were essential to reestablishing a viable and competitive cost structure. These concessions included significant headcount reductions, the elimination of the JOBS bank, the creation of a two-tiered wage and benefit structure that will apply to new hires, and the establishment of the UAW- administered retiree healthcare program. The current contract expires in September. Ford, unlike General Motors and Chrysler, does not have a no- strike provision in its contract. Consequently, Moody's believes Ford will likely be selected by the UAW as the target for negotiation of a new contract that will then set the pattern for key elements of contracts ultimately reached with GM and Chrysler. Bruce Clark, senior vice president with Moody's said "Almost everything that Ford needs in order to stay on track for a stronger credit profile is in place: a robust US product portfolio, recovering domestic demand, a significantly stronger balance sheet after debt reduction actions, almost $28 billion in liquidity, and operating efficiencies that are competitive with those of transplants. The one thing that could derail them is a new UAW contract that undermines the US industry's new-found cost competitiveness, or that results in a prolonged or expensive strike." Moody's base case forecast for Ford anticipates that a new UAW contract will continue to incorporate some form of profit sharing that enables workers to participate in the improving financial performance of the company. Moody's expects that such a program will not represent an overly burdensome increase in Ford's cost structure and will not materially impact the pace of improvement in the company's credit metrics. If Ford achieves a new contract that preserves its operating flexibility without a costly strike, and continues to strengthen its credit metrics, the company's rating could be raised. Moody's considered alternate scenarios including the risk that a strike could temporarily disrupt Ford's operations and severely erode its liquidity position, or that the new contract ultimately reached could include more costly wages, benefits or work-rule provisions. Moody's believes that the probability of a new contract substantially reversing the competitive gains that have been achieved by the US automotive industry is low. Nevertheless, the contract negotiations are an important risk factor that will constrain any improvement in the rating until constructively resolved. Ford's SGL-2 Speculative Grade Liquidity rating recognizes the company's considerable liquidity resources, which include $20.5 billion in cash and approximately $7 billion in committed credit facilities. The company's major liquidity requirement is the approximately $7 billion to $8 billion that we estimate it will need to fund intra-month working capital requirements. Debt maturities are relatively modest at approximately $2 billion during the coming twelve months. Ford's liquidity sources of $27.7 billion exceed these requirements by approximately $21 billion. Ford must also contend with the potentially sizable cash burn and the resulting liquidity requirement that might arise in the event of a prolonged strike. Ford's total liquidity sources of $28 billion should provide ample coverage of all requirements -- even those that might result from a strike. Nevertheless, the critical nature of the upcoming negotiations and the uncertainty surrounding the resolution constrain the company's Speculative Grade Liquidity rating at SGL-2. A successful resolution of the contract negotiations and a preservation of Ford's sizable liquidity position would likely support an increase in the Speculative Grade Liquidity rating to SGL-1. Ford's progress on its operating initiatives is likely to lead Ford Credit to experience higher origination volumes, better access to funding, and steadier profitability metrics. However, Ford Credit's continuing reliance on confidence-sensitive wholesale funding and its high percentage of encumbered assets are constraints on its stand-alone profile. Furthermore, Moody's expects that Ford Credit will eventually increase its leverage, reducing cash liquidity by increasing distributions to Ford. In time, the negative consequences of this on the firm's credit profile could be partially offset if Ford Credit successfully transitions its funding mix to include a higher percentage of unsecured debt and unencumbered assets, and further strengthens its liquidity profile. The last rating action for Ford and Ford Credit was an upgrade of their Corporate Family Rating to Ba2 on October 8, 2010. The principal methodology used in rating Ford was Moody's Global Automotive Manufacturer Methodology, published in December 2007. The principal methodology used in rating Ford Credit is Analyzing the Credit Risks of Finance Companies. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found on Moody's website. GENERAL EMPLOYMENT: Gets Add'l Deficiency Letter from NYSE Amex --------------------------------------------------------------- General Employment Enterprises, Inc. disclosed that on January 27, 2011, the Company received an additional deficiency letter from NYSE Amex LLC indicating that, based on a review of publicly available information, the Company is not in compliance with Section 1003(a)(ii) of the NYSE Amex Company Guide because it had stockholders' equity of less than $4,000,000 and losses from continuing operations and net losses in three out of its four most recent fiscal years. As previously announced by the Company, the Company received a deficiency letter from the Exchange on June 17, 2010 indicating that the Company was not in compliance with Section 1003(a)(i) of the Company Guide because it had stockholders' equity of less than $2,000,000 and losses from continued operations and net losses in two out of its three most recent fiscal years. The Company was afforded the opportunity to submit a specific plan to achieve and sustain compliance with the Exchange's continued listing requirements, and on July 14, 2010, August 17, 2010, August 19, 2010, August 26, 2010, September 8, 2010 and September 13, 2010, the Company presented its plan and supporting documentation to the Exchange. The Company received notice from Exchange staff on September 24, 2010 indicating that the Exchange accepted the Plan and granted an extension until December 16, 2011 for the Company to regain compliance with the continued listing standards. The Company has continued its listing during the extension period, during which time the Company has been subject to periodic review by Exchange staff. At this time, the Company is not required to submit an additional plan of compliance in connection with the deficiency identified in the January 27, 2011 letter because the Plan, as accepted by the Exchange, demonstrates the Company's ability to regain compliance with Section 1003(a)(ii) of the Company Guide. The Company is required, however, to submit a written update to the Exchange by no later than February 3, 2011 detailing the current status of the initiatives outlined in the Plan. The Company also has the option to supplement the Plan by no later than February 28, 2011 to address how it intends to regain compliance with Section 1003(a)(ii) of the Company Guide. The Company currently intends to prepare and submit a written update to the Exchange detailing the current status of the initiatives outlined in the Plan within the time frame required by the Exchange. If the Company is not in compliance with all of the Exchange's continued listing standards within the required time period or does not make progress consistent with the Plan during the extension period, the Exchange staff will initiate delisting proceedings as appropriate. The Company may appeal an Exchange staff determination to initiate delisting proceedings in accordance with Section 1010 and Part 12 of the Company Guide. There can be no assurance that the Company will be able to successfully implement the Plan and return to compliance with the Exchange's continued listing standards within the required time period. About General Employment General Employment provides the following distinctive services: (a) placement services (b) temporary professional staffing services in the fields of information technology, engineering, & accounting and (c) temporary staffing in the light industrial and agricultural industry. GENERAL MOTORS: Cancels Planned $14.4BB Loan From Dept. of Energy ----------------------------------------------------------------- Acknowledging significant improvement in its business performance, General Motors last week said it was withdrawing its $14.4 billion application for direct loans from the U.S. Department of Energy. The Advanced Technology Vehicles Manufacturing Loan Program -- Section 136 of the Energy Independence and Security Act passed in December 2007 -- authorized $25 billion in direct DOE loans to companies toward retooling U.S. factories to make vehicles and components that improve fuel economy. "This decision is based on our confidence in GM's overall progress and strong, global business performance," said Chris Liddell, GM vice chairman and chief financial officer. "Withdrawing our DOE loan application is consistent with our goal to carry minimal debt on our balance sheet." Since July 2009, the newly formed General Motors Company successfully launched a $23.1 billion Initial Public Offering of stock and, for the first nine months of 2010, generated $4.2 billion in net income attributable to common stockholders. Additionally, GM has invested approximately $3.4 billion in U.S. facilities that have created or retained nearly 11,000 jobs - most of which have gone towards new, fuel efficient cars like the extended-range electric Chevrolet Volt, the fuel-sipping Chevrolet Cruze, and advanced battery manufacturing. "Our forgoing government loans will not slow our aggressive plans to bring more new vehicles and technologies to the market as quickly as we can," said Liddell. "We will continue to make the necessary investments to assert our industry leadership in technology and fuel economy." The U.S. Congress appropriated funding for the DOE loan program in the fall of 2008 at a time when the auto industry was seeking to maintain its product and technology programs while contending with the developing global economic crisis. GM submitted its current application to the DOE in October 2009. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. was formed to acquire Old GM's operations through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, $971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GEO GROUP: S&P Lowers Rating to 'B+' on More Debt for Acquisition ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Boca Raton, Fl.-based The GEO Group to 'B+' from 'BB-'. The rating outlook is stable. "In addition, we lowered the issue-level ratings on the Company's amended $1 billion bank credit facility to 'BB' from 'BB+'. The amended bank credit facility increases the revolving credit facility due in August 2015 to $500 million from $400 million," said Standard & Poor's credit analyst Brian Milligan. The Company is issuing a new $150 million in term loan A-2 debt due in August 2015, to which S&P assigned a 'BB' issue-level rating and '1' recovery rating (the same as existing bank credit facility issue- level ratings). The term loan A due in August 2015 remains at $150 million. The term loan B due in August 2016 remains at $200 million. The recovery ratings on the amended bank credit facility remain '1', indicating S&P's expectation of very high (90% to 100%) recovery for debtholders in the event of a payment default. At the same time, S&P lowered the issue-level ratings on the Company's $250 million senior unsecured notes due August 2017 to 'B+' from 'BB-'. The recovery rating remains '4', indicating S&P's expectation of average (30% to 50%) recovery for debtholders in the event of a payment default. The Company intends to use the debt proceeds to help fund the acquisition of BI Inc. and pay transaction-related expenses. Pro forma for the proposed amendment, S&P estimates GEO will have about $1.5 billion in debt outstanding, a portion of which is non- recourse. The downgrade reflects the meaningful deterioration in GEO's credit metrics following proposed transaction of BI and the acquisition of Cornell, and S&P's view that management's financial policy has become more aggressive. S&P estimates the Company's pro forma adjusted leverage is high, at about 4.8x for the trailing 12 months ended Dec. 31, 2010, compared with 4.0x prior to the transaction. Cash flow protection measures will also be weak with pro forma funds from operations (FFO) to total debt at about 10% for the same time period. These measures are commensurate with 'B' rating category medians. S&P views the Company's financial risk profile as highly leveraged because of the Company's aggressive financial policy, increased leverage, and weakened cash flow protection measures. This overshadows S&P's assessment that the Company's business risk profile is fair due to its position as the second largest Company, with 33% market share, in the private corrections industry. GREAT ATLANTIC & PACIFIC: Pursues Adv. Proceeding vs. OfficeMax --------------------------------------------------------------- OfficeMax Inc., an Illinois-based office supplier, filed a complaint on August 16, 2010, in the Circuit Court of the Eighteenth Judicial District, in DuPage County, Illinois, against The Great Atlantic & Pacific Tea Company Inc. and its three senior executives. In its complaint, OfficeMax alleges that Sam Martin, a former employee of OfficeMax and the current president and chief executive of A&P, improperly solicited Carter Knox and Paul Hertz to leave their employment with OfficeMax and join A&P. Mr. Hertz is now A&P's executive vice-president for operations while Mr. Knox is the company's senior vice-president for human resources. Officemax also alleged in its complaint that Mr. Martin breached his employment contract, which specifically barred him from offering a job to one of his former co-workers without OfficeMax's written permission. According to The Wall Street Journal, Officemax said it conducted a "forensic investigation" and found out that Mr. Martin began talking to Mr. Knox about leaving his post at OfficeMax even before his appointment as A&P chief executive was announced. It also alleged that Mr. Knox received an A&P-issued cell phone more than a week before his resignation from OfficeMax and that Mr. Hertz was preparing an organizational chart for A&P while he still worked as an OfficeMax executive. On October 6, 2010, OfficeMax filed a motion seeking an expedited discovery schedule and a prompt trial on its complaint. The motion is scheduled to be heard on February 2, 2011, along with the defendants' motion to dismiss the complaint. The Martin complaint was stayed with respect to A&P after the company filed for bankruptcy protection on December 12, 2010. OfficeMax, however, has informed the Illinois State Court and A&P that its lawsuit will proceed against the senior executives absent an extension of the stay by a bankruptcy court or the entry of an injunction. A&P's lawyer, Ray Schrock, Esq., at Kirkland & Ellis LLP, in New York, says that if OfficeMax's motion for expedited discovery is granted and the defendants' motion denied, the three senior executives will be forced to participate in document productions and depositions just as they begin the process of restructuring the Debtors' operations. To avoid a disruption in their restructuring efforts, the Debtors have filed with the U.S. Bankruptcy Court for the Southern District of New York an adversary complaint against OfficeMax, which seeks: (1) a declaratory judgment that the Martin complaint is stayed pursuant to Section 362 of the Bankruptcy Code; or (2) an injunction preventing the senior executives from prosecuting the Martin complaint pending the confirmation of a plan of reorganization. The Debtors also filed a motion for preliminary injunction halting OfficeMax's lawsuit pending confirmation of a Chapter 11 restructuring plan just in case the Bankruptcy Court does not extend the automatic stay to the lawsuit. "Extension of the stay to cover the individual defendants in the Martin complaint is warranted because those defendants are key A&P executives whose involvement in that action as defendants could imperil the Debtors' efforts to emerge from bankruptcy," Mr. Schrock says in court papers. "The prosecution of the Martin complaint will distract and divert the individual defendants from their critical roles in executing the Debtors' turnaround plan. There is, thus, an identity of interest between the individual defendant and the Debtors that justifies an extension of the automatic stay," Mr. Schrock points out. Mr. Schrock further says that the Debtors will be forced to spend substantial amounts of money on the Martin complaint because of indemnification obligations to the senior executives. 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. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represent the Official Committee of Unsecured Creditors. 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: Sues Landlords to Take Back Payments -------------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors have filed a lawsuit against three landlords to avoid certain preferential transfers and recover a property or the value of a property transferred. The landlords are Basser-Kaufman of Centereach LLC, Levittown Mews Associates LP and Plainfield Associates. In a 10-page complaint filed with the U.S. Bankruptcy Court for the Southern District of New York, A&P's lawyer, Ray Schrock, Esq., at Kirkland & Ellis LLP, in New York, says the defendants pressured the Debtors into placing them ahead of other creditors by paying them a total of $606,098 on account of alleged antecedent debt owed for arrearages in their leases. "The defendants had, among other things, threatened that absent payment of the transfers on account of their antecedent debts, they would begin an involuntary bankruptcy proceeding," Mr. Schrock says. The Debtors made the transfers on December 10, 2010, two days before their bankruptcy filing. Mr. Schrock says the Debtors will get no value for the $606,098 since they had long since vacated the facilities they leased from the defendants and are planning to reject their leases effective December 12, 2010. "Any theoretical pre-payment for the use of the leased premises in the future would thus, by definition, have absolutely no value to the Debtors," Mr. Schrock points out. He further says that the transfers are preferential and fraudulent transfers avoidable under the Bankruptcy Code. The Court will hold a pretrial conference on the complaint on February 22, 2011. 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. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represent the Official Committee of Unsecured Creditors. 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: Wants Until July 10 to Decide on Leases ----------------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors seek additional time to decide whether to assume or reject 768 unexpired nonresidential real property leases. The Debtors want the deadline moved from April 11 to July 10, 2011. "The relief sought will help ensure that the Debtors have the best opportunity to make fully informed decisions regarding which leases they will keep and which they will not rather than having to make premature decisions under what is already a short statutory deadline as they hone their business plan," says the Debtors' lawyer, Ray Schrock, Esq., at Kirkland & Ellis LLP, in New York. Section 365(d)(4) of the Bankruptcy Code provides that the Debtors have an initial 120-day period to assume their leases lest they be deemed rejected subject to up to a 90-day extension for cause shown unless a landlord consents to a further extension beyond 210 days. Mr. Schrock further says that the proposed extension would also help the Debtors avoid administrative claims or unnecessary rejection damages that may result if they "precipitously" reject or assume the unexpired leases. As of December 12, 2010, the Debtors have about 892 leases of nonresidential real properties of which 124 have already been rejected. A list of the Debtors' remaining leases is available for free at http://bankrupt.com/misc/A&P_UnexpiredLeases.pdf Generally, the Debtors do not own the properties and only lease them to operate their supermarkets and various stores, notes Mr. Schrock. These leasehold interests are considered primary assets of the Debtors' estates and comprise a primary component of the collateral package provided to the lenders under the debtor-in- possession facility, which includes more than 200 leasehold interests that are worth hundreds of millions of dollars, he says. The Court will hold a hearing on February 1, 2011, to consider approval of the proposed extension. Grays Ferry, et al. Object Grays Ferry Partners LP asks the Court to deny the proposed extension, saying the request is "premature." Pathmark Stores Inc. leases from Grays Ferry one of its stores located at the Grays Ferry Shopping Center, in Philadelphia, Pennsylvania. Grays Ferry's lawyer, Michael Landis, Esq., in Trevos, Pennsylvania -- mlandis@mlandislaw.com -- argues that the Debtors still have about three months to evaluate their leases. "During this remaining time, the Debtors are certainly able to identify some additional leases and perhaps the Grays Ferry lease that they will seek to assume or reject," Mr. Landis points out. "Granting an early extension is prejudicial to Grays Ferry because it prolongs the limbo between rejection and assumption in which the Grays Ferry lease lingers and results in lost rental opportunities and increased risks to the landlord," Mr. Landis further says. The Debtors' motion also drew flak from other landlords including Ocean Norse Realty LLC and Ocean City Factory Outlets I LC. Ocean Norse, the landlord under a lease contract with A&P's affiliated debtor Waldbaum Inc., expressed support to Grays Ferry's objection. Ocean City, owner of the Maryland-based shopping center known as Ocean City Factory Outlets, expressed concern that the approval of the motion would stall its efforts to close a major transaction to sell the shopping center. Meanwhile, Goodrich Hazlet LLC and New Hope Centers said they won't object to the approval of the motion so long as it won't change the terms of their lease contracts, and the Debtors will continue making payments under the contracts, among other things. 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. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represent the Official Committee of Unsecured Creditors. 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). GREENBRIER COS: Deloitte Replaced by KPMG as Accountants -------------------------------------------------------- On January 24, 2011, The Greenbrier Companies, Inc., dismissed Deloitte & Touche, LLP, as its independent registered public accountants. Effective January 24, 2011, the Audit Committee of the Company's Board of Directors engaged KPMG LLP to serve as the independent public accountants to audit the Company's consolidated financial statements for the fiscal year ending August 31, 2011. The decision to change accountants was approved by the Audit Committee. In deciding to engage KPMG, the Audit Committee reviewed auditor independence and existing commercial relationships with KPMG, and concluded that KPMG has no commercial relationship with the Company that would impair its independence. Deloitte & Touche's reports on the Company's consolidated financial statements for the fiscal years ended August 31, 2009 and August 31, 2010 did not contain an adverse opinion or a disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principles. During the Company's past two fiscal years and the interim period through January 24, 2011, the Company had no disagreements with Deloitte & Touche on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to Deloitte & Touche's satisfaction, would have caused Deloitte & Touche to make reference to the subject matter of the disagreement in connection with its report. During the Company's past two fiscal years and the interim period through January 24, 2011, Deloitte & Touche did not advise the Company of any of the matters specified in Item 304(a)(1)(v) of Regulation S-K. During the Company's fiscal years ended August 31, 2009 and August 31, 2010, and the interim period through January 24, 2011, the Company has had no consultations with KPMG concerning: (a) the application of accounting principles to a specific transaction or the type of opinion that might be rendered on the Company's financial statements as to which the Company received oral advice that was an important factor in reaching a decision on any accounting, auditing or financial reporting issue; or (b) any matter that was the subject of a disagreement as defined in Item 304(a)(1)(iv) of Regulation S-K or a reportable event as described by Item 304(a)(1)(v) of Regulation S-K. About Greenbrier Cos. Based in Lake Oswego, Oregon, The Greenbrier Companies Inc. operates in three primary business segments: manufacturing, refurbishment and parts, and leasing and services. The manufacturing segment, operating from four facilities in the United States, Mexico and Poland, produces double-stack intermodal railcars, conventional railcars, tank cars and marine vessels. The refurbishment & parts segment performs railcar repair, refurbishment and maintenance activities in the United States and Mexico. The leasing & services segment owns roughly 8,000 railcars and provides management services for roughly 225,000 railcars. The Company's balance sheet as of November 30, 2010, showed $1.1 billion in total assets, $812.7 million in total assets and $296.5 million in total equity. * * * Greenbrier carries a 'Caa1' corporate family rating from Moody's Investors Service and a Speculative Grade Liquidity Rating of SGL-3. In August 2010, Moody's said Greenbrier's rating outlook is negative in consideration of the continued sluggish demand for new railcars and the company's need to address certain refinancing needs. GREENFIELD SCHOOL BOARD: Feb. 7 Meeting Set to Discuss Financials ----------------------------------------------------------------- Stefanie Scott, writing for Community Newspapers Inc.'s greenfieldnow.com, reports that Superintendent Conrad Farner has told the School Board Greenfield School District is only a few years away from being broke. According to the report, while projections for the 2011-12 budget are very preliminary at this point, administrators expect another $700,000 to more than $1 million will need to be cut. That comes on top of the more than $5 million in programs, staffing and supplies that have been eliminated from the district in recent years. "Things are reaching a level that I would call crisis mode," Mr. Farner said, adding the district has already sold property, conserved energy, kept salaries low or frozen them and has class sizes reaching 40 students per class at the high school to make ends meet. The Greenfield School Board will discuss the district's financial situation and whether to pursue an operational referendum on 6:30 p.m. Feb. 7. Located in the southwestern Milwaukee County suburb of Greenfield, the School District of Greenfield -- http://www.greenfield.k12.wi.us/-- educates roughly 3,700 students in four elementary schools, one middle school and one high school. GVSW SURPRISE: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: GVSW Surprise Plaza, LLC 7201 E. Camelback Road, Suite 200 Scottsdale, AZ 85251 Bankruptcy Case No.: 11-02238 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: James M. Marlar Debtor's Counsel: Mark W. Roth, Esq. POLSINELLI SHUGHART P.C. One East Washington Street CityScape Building, Suite 1200 Phoenix, AZ 85004 Tel: (602) 650-2012 Fax: (602) 926.8562 E-mail: mroth@polsinelli.com Estimated Assets: $1,000,001 to $10,000,000 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 J. Glimcher, manager of DJG Development, LLC, manager. HILL TOP: Court Dismisses Amended Second Exclusivity Motion ----------------------------------------------------------- Judge Ronald B. King of the U.S. Bankruptcy Court for the Western District of Texas, San Antonio Division, dismissed as moot the amended second motion to extend the exclusivity period of Hill Top Farm, Ltd. The Debtor requested until January 31, 2011, to file its proposed chapter 11 plan because it believes that it will, with Court approval, sell a portion of its real property in the very near future. The Debtor explained that its formulated plan will likely need to be modified. San Antonio, Texas-based Hill Top Farm, Ltd., filed for Chapter 11 bankruptcy protection on July 2, 2010 (Bankr. W.D. Tex. Case No. 10-52526). William B. Kingman, Esq., who has an office in San Antonio, Texas, represents the Debtor. The Company estimated assets at $10 million to $50 million and debts at $1 million to $10 million. There was no creditors committee appointed in the Debtor's case. HILLSBOROUGH CORP: Case Summary & 11 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Hillsborough Corporation P.O. Box 2611 Orange, CA 92859 Bankruptcy Case No.: 11-11181 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtor's Counsel: H Stan Johnson, Esq. CJD LAW GROUP, LLC 6293 Dean Martin Drive, Suite G Las Vegas, NV 89118 Tel: (702) 823-3500 Fax: (702) 823-3400 E-mail: sjohnson@cjdnv.com Scheduled Assets: $1,800,000 Scheduled Debts: $3,754,634 A list of the Company's 11 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nvb11-11181.pdf The petition was signed by Kenneth Gharib, president. HORIZON COLDWATER: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Horizon Coldwater, LLC 2111 N Wixom Road Wixom, MI 48393 Bankruptcy Case No.: 11-41954 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Eastern District of Michigan (Detroit) Judge: Walter Shapero Debtor's Counsel: Robert N. Bassel, Esq. P.O. Box T Clinton, MI 49236 Tel: (248) 677-1234 Fax: (248) 369-4749 E-mail: bbassel@gmail.com Estimated Assets: $500,001 to $1,000,000 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 Saher Sandiha, managing member. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Best Stay Coldwater, Inc. 11-41953 01/27/11 HUBBARD PROPERTIES: Files for Chapter 11 Bankruptcy Protection -------------------------------------------------------------- Michael Sasso at The Tampa Tribune reports that Hubbard Properties blamed the BP oil spill and the economy for its Chapter 11 filing. It aims to shore up its finances while under bankruptcy protection from creditors. Hubbard Properties owns tourist and entertainment center John's Pass Village in Madeira Beach, Florida. Hubbard Properties said it owes $22 million to Investors Warranty of America. Hubbard Properties, LLC, filed for Chapter 11 protection (Bankr. M.D. Fla. Case No. 11-01274) in Tampa on Jan. 27, 2011. David S. Jennis, Esq., at Jennis & Bowen, P.L., serve as counsel to the Debtor. The Debtor estimated assets and debts of $10,000,001 to $50,000,000 as of the Petition Date. INNKEEPERS USA: U.S. Trustee Objects to Professionals' Fees ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Trustee last week filed an objection to Kirkland & Ellis LLP's $6.28 million fee request, arguing that there should be no compensation in connection with the botched plan support agreement for Innkeepers USA Trust. Mr. Rochelle recounts that in the early days in the reorganization of Innkeepers USA Trust, the bankruptcy judge refused to approve a so-called plan support agreement giving shared ownership to the existing owner and one of the lenders. The judge rejected the agreement at the behest of the secured creditor with the largest claim. According to the report, the U.S. Trustee said it wants fees cut by an additional $59,800, for time spent by Kirkland, the bankruptcy lawyers for Innkeepers, for preparing bills and fee applications. The U.S. Trustee also said no compensation should be given at this time to the financial advisors in the case because their time records are too vague. Moelis & Co. LLC, advisors for Innkeepers, asked for $709,500, while Jefferies & Co. LLC, advisors for the committee, is seeking $508,000. The U.S. Trustee also said that Morrison & Foerster LLP, lawyers for the creditors' committee, should have $19,000 chopped from a $1.4 million fee request for time spent preparing bills and fee applications. 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 91 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. Attorneys at Morrison & Foerster, LLP, represent the Official Committee of Unsecured Creditors. Jefferies & Co. LLC, serves as advisors for the committee. The Company's consolidated assets for 2009 totaled roughly $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred roughly $1.29 billion of secured debt. INSIGHT HEALTH: Judge Gonzales Signs Plan Confirmation Order ------------------------------------------------------------ Dow Jones' DBR Small Cap reports that InSight Health Services Holding Corp. won court approval of its Chapter 11 plan of reorganization, paving the way for the medical-imaging center operator to emerge from bankruptcy protection. Judge Arthur J. Gonzalez of the U.S. Bankruptcy Court in Manhattan on January 28 signed an order confirming InSight's restructuring plan. Judge Gonzalez held a combined hearing on Jan. 25 to pass on the adequacy of the disclosure statement used to solicit acceptances of InSight Health Services Holdings Corp.'s prepackaged chapter 11 plan of reorganization, and to consider whether that plan should be confirmed. The Chapter 11 Plan As reported in the Dec. 13, 2010 edition of the Troubled Company Reporter, InSight Health Services, filed together with its bankruptcy petition, a proposed prepackaged Chapter 11 plan of reorganization. Under the plan, the Debtors' senior secured notes -- the only class of claims or interests entitled to vote on the plan -- will be converted into equity. The Debtors' general unsecured creditors are unimpaired and will receive a full recovery on their general unsecured claims. Additionally, the Debtors' senior secured noteholders agree to convey to the equityholders warrants to acquire two percent of the fully diluted equity in the reorganized Debtors, in recognition of the Debtors' existing equityholders' efforts to achieve a successful, consensual restructuring that preserves value for the Debtors' businesses and creditors. Upon the Petition Date, the Debtors have obtained votes accepting the plan from the holders of over two thirds of the amount of the senior secured notes. The Debtors believe that they will obtain further acceptance of the plan by the proposed December 27, 2010 voting deadline and be able to confirm the plan expeditiously. The Debtors expect to emerge from the chapter 11 process as a substantially deleveraged enterprise well positioned to compete successfully in the competitive diagnostic medical imaging industry going forward. A full-text copy of the Plan is available for free at: http://bankrupt.com/misc/InsightHealth_Plan_DS.pdf About Insight Health InSight Health Services Holdings Corp. provides diagnostic medical imaging services through a network of fixed-site centers and mobile facilities. Its services-including magnetic resonance imaging, positron emission tomography and computed tomography, traditional computed tomography, mammography, bone densitometry, ultrasound and x-ray-are noninvasive procedures that generate representations of internal anatomy on film or digital media, which are used by physicians for the diagnosis and assessment of diseases and other medical conditions. The Company operates in more than 30 states and target specific regional markets. Insight Health Services Holdings Corp. and its affiliate, InSight Health Services Corp., sought Chapter 11 protection (Bankr. D. Del. Case Nos. 07-10700 and 07-10701) on May 29, 2007, with a prepackaged bankruptcy plan that was confirmed on July 10, 2007, and declared effective on August 1, 2007. InSight Health Services Holdings Corp. made a second trip to the bankruptcy court (Bankr. S.D.N.Y. Lead Case No. 10-16564) on Dec. 10, 2010, with another prepackaged Chapter 11 plan of reorganization Sixteen affiliates also filed for Chapter 11 protection. InSight is represented by Edward O. Sassower, Esq., James H.M. Sprayregan, Esq., and Ryan Blaine Bennett, Esq., at Kirkland & Ellis LLP. Zolfo Cooper is the Debtors' financial advisor, and BMC Group Inc. is the claims and noticing agent. Chris L. Dickerson, Esq. -- chris.dickerson@skadden.com -- and Matthew M. Murphy, Esq. -- matthew.murphy@skadden.com -- at Skadden, Arps, Slate, Meagher & Flom LLP in Chicago, Ill., represent an ad hoc group of Noteholders in the Debtors' cases. The Debtors' prepetition secured lenders are represented by C. Edward Dobbs, Esq. -- edobbs@phrd.com -- at Parker, Hudson, Rainer & Dobbs LLP in Atlanta, Ga. INTEGRAS PROPERTY: Case Summary & 4 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Integras Property Management, Inc. 17352 Main Street, North Blountstown, FL 32424 Bankruptcy Case No.: 11-40051 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Northern District of Florida (Tallahassee) Debtor's Counsel: J. Randall Frier, Esq. FRIER & FRIER, P.A. 1682 Metropolitan Circle, Suite A Tallahassee, FL 32308 Tel: (850) 894-2084 Fax: (850) 894-9494 E-mail: cumberland_1988@yahoo.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flnb11-40051.pdf The petition was signed by William C. Williams, III, director. INVETIV HEALTH: i3 Buyout Cues Moody's to Hold 'B2' Rating ---------------------------------------------------------- Moody's Investors Service affirmed the B2 Corporate Family and Probability of Default Ratings of inVentiv Health Inc. following the announced acquisitions of i3 Global and Campbell Alliance Group, Inc., for $540 million, combined. Concurrently, Moody's affirmed the Ba3 rating on the existing senior secured credit facility and assigned a Ba3 rating to the proposed incremental senior secured debt, totaling $300 million. Moody's also affirmed the Caa1 rating on the existing unsecured notes and assigned a Caa1 to the proposed $150 new unsecured notes offering. The proceeds of the debt, along with cash on hand and incremental equity from inVentiv's shareholders will fund the two acquisitions, expected to close in February and March of 2011. The outlook for the ratings is stable. These ratings were assigned: -- $100 million Senior Secured Term Loan due 2016, Ba3 (LGD3/31%) -- $200 million delayed draw Term Loan due 2016, Ba3 (LGD3/31%) -- New $150 million Unsecured notes, Caa1 (LGD5, 86%) These ratings were affirmed: -- B2 Corporate Family Rating -- B2 Probability of Default rating -- $75 million Senior Secured Revolver due 2015, Ba3 (LGD3/31%) -- $525 million Senior Secured Term Loan due 2016, Ba3 (LGD3/31%) -- $275 million Unsecured Notes due 2018, to Caa1 (LGD5, 86%) from Caa1 (LGD5, 85%) -- SGL-2 Speculative Grade Liquidity Rating The outlook is stable. The B2 Corporate Family Rating reflects the considerable financial leverage taken on in the leveraged buyout transaction, as well as incremental leverage assumed to acquire i3 and Campbell Alliance. The ratings are also constrained by a number of risks inherent in the business including: project cancellations due to FDA non- approval decisions or generic competition of client's products, reduced client marketing budgets, and pharmaceutical industry consolidation. The ratings are supported by the breadth of inVentiv's diverse service offerings, which over time could result in increased cross-selling opportunities and stronger client relationships. Moody's believe the proposed acquisitions will add to this breadth as well as help inVentiv become a more global company, given i3's international operations. inVentiv also has a track record of generating positive free cash flow, which we expect to continue even after the considerable increase in interest expense. The principal methodologies used in this rating were Global Business & Consumer Service Industry 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. inVentiv, headquartered in Somerset, New Jersey, is a leading provider of outsourced services to the pharmaceutical, life sciences and healthcare industries. inVentiv provides a broad range of clinical development, communications and commercialization services to clients to assist in the development and commercialization of pharmaceutical products and medical devices. For the twelve months ended September 30, 2010, the company reported approximately $980 million in net revenues. In August 2010, inVentiv was taken private by Thomas H. Lee Partners and Liberty Lane Partners in a transaction valued at $1.1 billion. IRVINE SENSORS: 9 Investors Convert $246,400 of Notes ----------------------------------------------------- Irvine Sensors Corporation previously sold 10% Unsecured Convertible Promissory Notes due May 31, 2011 to investors in an aggregate principal amount of $3,000,000, the terms of which permit the holders of the Bridge Notes to convert up to and including the aggregate outstanding principal amount of those Bridge Notes and any accrued interest thereon into the same securities issued in, and upon the same terms and conditions of, the Company's secured convertible note financing that occurred on December 23, 2010. On January 21, 2011, the Company entered into Joinder Agreements with 9 accredited Bridge Note Holders who held Bridge Notes in the aggregate principal amount of $246,400, pursuant to which those Bridge Note Holders agreed to be bound by the terms of the Securities Purchase Agreement entered into in the Financing and converted the Conversion Amount under their Bridge Notes into the same securities issued in the Financing, with 31.8% of such aggregate Conversion Amount being allocated to the purchase of an aggregate of 1,138,373 shares of the Company's common stock for $79,686, or $0.07 per share, and the remaining $170,899 of the aggregate Conversion Amount being allocated to the purchase of 12% Subordinated Secured Convertible Notes due January 21, 2016. None of the Shares, the Notes or the shares of Common Stock issuable upon conversion thereof has been registered under the Securities Act of 1933 and none may be offered or sold absent registration or an applicable exemption from registration. About Irvine Sensors Headquartered in Costa Mesa, Calif., Irvine Sensors Corporation (OTC BB: IRSN) -- http://www.irvine-sensors.com/-- is a vision systems company engaged in the development and sale of miniaturized infrared and electro-optical cameras, image processors and stacked chip assemblies and sale of higher level systems incorporating said products. Irvine Sensors also conducts research and development related to high density electronics, miniaturized sensors, optical interconnection technology, high speed network security, image processing and low-power analog and mixed-signal integrated circuits for diverse systems applications. Squar, Milner, Peterson, Miranda & Williamson, LLP, in Irvine, Calif., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that as of October 3, 2010, the Company has negative working capital of $10.1 million and a stockholders deficit of $10.1 million. The Company reported a net loss of $11.16 million on $11.72 million of revenues for the fiscal year ended October 3, 2010, compared with a net loss of $914,700 on $11.54 million of revenues for the fiscal year ended September 27, 2009. The Company's balance sheet at October 3, 2010, showed $6.32 million in total assets, $16.42 million in total liabilities, and a stockholders' deficit of $10.10 million. JASON'S HAULING: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Jason's Hauling, Inc. 6108 W. Linebaugh Avenue Tampa, FL 33625 Bankruptcy Case No.: 10-01360 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Judge: Catherine Peek McEwen Debtor's Counsel: Chad S. Bowen, Esq. JENNIS & BOWEN, P.L. 400 N. Ashley Drive, Suite 2540 Tampa, FL 33602 Tel: (813) 229-1700 Fax: (813) 229-1707 E-mail: ecf@jennisbowen.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb11-01360.pdf The petition was signed by H. Jason Freyre, Jr., president. JAVO BEVERAGE: Gets Court's Interim Nod to Obtain DIP Financing --------------------------------------------------------------- Javo Beverage Company, Inc., sought and obtained interim authorization from the Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware to obtain postpetition secured financing from Coffee Holdings LLC. The DIP Lender has committed to provide up to $3.151 million of financing, of which $500,000 plus interest and any all other amounts due the prepetition loan will be reserved for a dollar- for-dollar roll-up of a certain secured revolving promissory note, dated January 6, 2011, issued prepetition to Coffee Holdings by the Debtor. A copy of the DIP financing agreement is available for free at: http://bankrupt.com/misc/JAVO_BEVERAGE_dipfinancingpact.pdf Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP, explained that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor is allowed to borrow under the DIP credit agreement up to $1.2 million of the DIP loans to be used for working capital, general corporate purposes, and the repayment and roll up of the prepetition loan of the Debtor. The DIP facility will mature on (i) the date on which all the DIP loans have been indefeasibly repaid in full in cash and all of the DIP commitments have been permanently and irrevocably terminated; (ii) no later than June 30, 2011; (iii) the date of the closing of a sale of all or substantially all of the Debtor's assets; (iv) a confirmed plan of reorganization of the Debtor; and (v) the date of termination of the commitments and acceleration of any outstanding extensions of credit following the occurrence and during the continuance of an event of default. The DIP loans will bear interest at a rate equal to the London Interbank Offered Rate plus 8.0%, with LIBOR subject to a floor of 1.5%. Interest will be payable monthly, in cash, in arrears, calculated on the basis of the actual number of days elapsed in a 360-day year. In the event of default, the Debtor will pay an additional 2% default interest per annum. The Debtor will pay the DIP Lender an up-front commitment fee of 3.0% of the aggregate amount of the DIP commitment. The DIP Facility will be secured by automatically perfected superpriority senior liens with respect to (i) any unencumbered assets of the Debtor, wherever located, now or hereafter owned, provided, that the DIP Lender's liens on the proceeds of the avoidance actions will be split 50-50 with Accord Financial, Inc., pursuant to its debtor-in-possession facto funding being provided simultaneously with the DIP Facility; (ii) assets securing the prepetition loan; and (iii) funds advanced by the DIP Lender in the control account. The DIP Facility will also be secured by junior liens on all other assets of the Debtor that are subject to valid and perfected liens in existence at the time of commencement of the bankruptcy case or to valid liens in existence at the time of the commencement. 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 up to $25,000 in fees of the committee in pursuing actions challenging the DIP Lenders' lien. The DIP Lender's right to credit bid the DIP loans and the prepetition loan will be expressly reserved. Cash Collateral The Debtor also obtained an interim order authorizing access to cash collateral securing its prepetition debt to Coffee Holdings. The Debtor was indebted to the DIP Lender at least (i) 500,000 in principal amount of the prepetition loan made by the DIP Lender, plus any interest, fees and expenses, as provided in prepetition loan documents; (ii) $12 million in principal amount in respect of the DIP Lender's 10% notes beneficially owned by it plus any interest, fees, and expenses in accordance with the terms thereof; and (iii) $5.2 million in principal amount in respect of the DIP Lender's PIK Note, ranking senior in priority to the 10% Notes, beneficially owned by it plus any interest, fees, and expenses in accordance with the terms thereof. In exchange for the use of cash collateral, the DIP Lender is granted a valid, perfected replacement security interest in and lien on all of the DIP collateral, and superpriority claims, with priority in payment over any and all administrative expenses. Final Hearing The Court has set a final hearing for February 11, 2011, at 10:00 a.m., prevailing Eastern Time. About Javo Beverage Vista, California-based Javo Beverage Company, Inc., aka La Jolla Fresh Squeezed Coffee Co., Inc., manufactures coffee and tea-based dispensed beverages, drink mixes and flavor systems. It filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. Del. Case No. 11-10212). Debra A. Riley, Esq., at Allen Matkins Leck Gamble Mallory & Natsis LLP, serves as the Debtor's bankruptcy counsel. Robert J. Dehney, Esq., and Matthew B. Harvey, Esq., at Morris, Nichols, Arsht & Tunnell LLP, is the Debtor's co-counsel. Goodwin Procter, LLP, is the Debtor's special counsel. Valcor Consulting LLC is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the Debtor's claims agent. The Debtor disclosed $14,659,681 in total assets and $26,705,755 in total debts as of the Petition Date. JAVO BEVERAGE: Section 341(a) Meeting Scheduled for Feb. 23 ----------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of Javo Beverage Company, Inc.'s creditors on February 23, 2011, at 10:00 a.m. (prevailing Eastern Time). The meeting will be held at the J. Caleb Boggs Federal Building, 844 King Street, 2nd Floor, Room 2112, Wilmington, Delaware 19801. 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. Vista, California-based Javo Beverage Company, Inc., aka La Jolla Fresh Squeezed Coffee Co., Inc., manufactures coffee and tea-based dispensed beverages, drink mixes and flavor systems. It filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. Del. Case No. 11-10212). Debra A. Riley, Esq., at Allen Matkins Leck Gamble Mallory & Natsis LLP, serves as the Debtor's bankruptcy counsel. Robert J. Dehney, Esq., and Matthew B. Harvey, Esq., at Morris, Nichols, Arsht & Tunnell LLP, is the Debtor's co-counsel. Goodwin Procter, LLP, is the Debtor's special counsel. Valcor Consulting LLC is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the Debtor's claims agent. The Debtor disclosed $14,659,681 in total assets and $26,705,755 in total debts as of the Petition Date. JAVO BEVERAGE: Gets Court's Nod to Hire Kurtzman as Claims Agent ---------------------------------------------------------------- Javo Beverage Company, Inc., sought and obtained authorization from the Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware to employ Kurtzman Carson Consultants as claims, noticing and balloting agent. KCC will, among other things: a. prepare and serve required notices in the Debtor's Chapter 11 case; b. record any court order which may affect a claim by making a notation on the claims register; c. receive, examine, and maintain copies of all proofs of claims and proofs of interest filed in the case; and d. maintain an official claims register for public examination without charge during regular business hours. KCC will charge the Debtor for KCC's services, expenses and supplies at the rates or prices set by KCC and in effect as of the date of KCC's services agreement with the Debtor. KCC will receive a retainer in the amount of $5,000 that may be held by KCC as security for the Debtor's payment obligations under the agreement. KCC's services agreement with the Debtor sets forth the fees the firm charges for the services it will provide to the Debtor. A copy of the KCC's Services Agreement is available for free at http://bankrupt.com/misc/JAVO_BEVERAGE_kccpact.pdf Albert Kass, Vice President of Corporate Restructuring Services of KCC, assured the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. About Javo Beverage Vista, California-based Javo Beverage Company, Inc., aka La Jolla Fresh Squeezed Coffee Co., Inc., manufactures coffee and tea-based dispensed beverages, drink mixes and flavor systems. It filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. Del. Case No. 11-10212). Debra A. Riley, Esq., at Allen Matkins Leck Gamble Mallory & Natsis LLP, serves as the Debtor's bankruptcy counsel. Robert J. Dehney, Esq., and Matthew B. Harvey, Esq., at Morris, Nichols, Arsht & Tunnell LLP, is the Debtor's co-counsel. Goodwin Procter, LLP, is the Debtor's special counsel. Valcor Consulting LLC is the Debtor's financial advisor. The Debtor disclosed $14,659,681 in total assets and $26,705,755 in total debts as of the Petition Date. JAVO BEVERAGE: Has Interim Nod to Sell Accounts Receivable ---------------------------------------------------------- Javo Beverage Company, Inc., sought and obtained interim authorization from the Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware to sell accounts receivable under a postpetition accounts receivable factor program with Accord Financial, Inc., the DIP factor, for an amount not to exceed the lesser of (i) the current remaining funding available under the Factor Agreement and (ii) $6 million. A copy of the postpetition master purchase and sale agreement is available for free at: http://bankrupt.com/misc/JAVO_BEVERAGE_salepact.pdf Payments of principal and interest will be withheld from proceeds of funding due to the Debtor from the Factor under a certain amended and restated promissory note dated April 23, 2010, between the Factor and the Debtor. Upon the Debtor's submission of any account receivable to the Factor for purchase, the Debtor will execute for each account receivable or group of accounts receivable, an invoice control record that identifies and describes the accounts receivable being offered for purchase and the total face amount of the accounts receivable. In the Factor's sole discretion and according to the customary ordinary course of business practice of the Factor and the Debtor, it may advance the purchase price for the accounts receivable purchased up to 75% of the face amount of the accounts receivable, minus the applicable discount fee and the regularly scheduled payments of principal and interest due under the term loan. As adequate protection and as an inducement to the DIP Factor to permit the Debtor's use of the prepetition collateral, the Debtor grants, assigns and pledges to the DIP Factor, postpetition replacement security interests in and liens, on all of the prepetition collateral whether acquired before or after the Petition Date. The DIP Factor will have the right to credit bid with respect to any sale of assets or equity or a plan of reorganization, the amount owing pursuant to the obligations, which credit bid rights won't be impaired in any manner, and no future order or plan may impair the credit bid rights of the DIP Factor. The effectiveness of the sale agreement is conditioned on: (a) the entry of an interim court order approving the terms and conditions of the DIP facility; (b) satisfactory review by the Factor of all motions, orders, and other pleadings or related documents to be filed or submitted to the Court in connection with the DIP facility and the approval thereof; (c) one business day advance notice to the Factor of all motions, orders, and other pleadings or related documents to be filed or submitted to the Court with respect to any sale of assets or bid procedures or stalking horse protections in connection therewith; and (d) except as may otherwise be provided herein, and upon receipt and review of invoices describing fees and expenses payable to the Factor, the Debtor will have paid to the Factor all fees and expenses due and payable on the date of the closing of the DIP Facility. The Debtor will furnish the Factor upon request any prior or current income statement, balance sheet, tax return and reports, along with any other supplementary financial information reasonably requested. The sale agreement will be effective from the date hereof and will continue in full force and effect until the earlier of (i) a period of 36 months from the date of the Factor Agreement, (ii) the effective date of the Debtor's plan of reorganization, or (iii) the filing of a motion to dismiss or convert the Debtor's bankruptcy case to one under Chapter 7 of the U.S. Bankruptcy Code. The Court has set a final hearing for February 11, 2011, at 10:00 a.m. (Eastern Time) on the sale of the accounts receivable. About Javo Beverage Vista, California-based Javo Beverage Company, Inc., aka La Jolla Fresh Squeezed Coffee Co., Inc., manufactures coffee and tea-based dispensed beverages, drink mixes and flavor systems. It filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. Del. Case No. 11-10212). Debra A. Riley, Esq., at Allen Matkins Leck Gamble Mallory & Natsis LLP, serves as the Debtor's bankruptcy counsel. Robert J. Dehney, Esq., and Matthew B. Harvey, Esq., at Morris, Nichols, Arsht & Tunnell LLP, is the Debtor's co-counsel. Goodwin Procter, LLP, is the Debtor's special counsel. Valcor Consulting LLC is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the Debtor's claims agent. The Debtor disclosed $14,659,681 in total assets and $26,705,755 in total debts as of the Petition Date. JOHN KIEFFER: Files for Chapter 7 Bankruptcy Protection ------------------------------------------------------- Jennifer Sami at Forsyth News in Cumming reports that John Kieffer, chairman of the Cumming-Forsyth County Chamber of Commerce's board, has filed for Chapter 7 bankruptcy, citing $18.7 million owed to various creditors. Mr. Kieffer is the developer behind custom homes and various projects, including downtown's Cumming Station, in Georgia. KC ESTATES: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: KC Estates II LLC dba Howard Johnson 3501 Pacific Hwy E Fife, WA 98424 Bankruptcy Case No.: 11-40636 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Brian D. Lynch Debtor's Counsel: Karl Y. Park, Esq. LAW OFFICES OF KARL PARK 1010 S 336th St Suite 320 Federal Way, WA 98003 Tel: (253) 815-1400 E-mail: karlpark99@yahoo.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 Richard Rakesh Mumar, managing member. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- KC Estates LLC 10-47752 09/16/10 KELLEY & FERRARO: Files Ch. 11 to Stay Co-Founder's Wife Suit ------------------------------------------------------------- Michelle Park at Crain's Cleveland Business reports that Kelley & Ferraro LLP filed for Chapter 11 bankruptcy protection in attempt to resolve a legal battle between the firm and Lynn Kelley, widow of firm co-founder Michael Kelley. That bankruptcy filing stayed the civil proceedings brought by Ms. Kelley, which was expected to resume Wednesday in Cuyahoga County Common Pleas Court, in Ohio. According Crain's Cleveland Business, the legal battle between Ms. Kelley and the firm began in April 2006, four months after Ms. Kelley's husband died. Ms. Kelley alleged partner James Ferraro was not following the Company contract he signed with her late husband and claimed, among other things, that Mr. Ferraro had cut off her salary and refused to dissolve the firm and divide the assets as the contract required. A jury found in favor of Mr. Ferraro on all counts and found in favor of Kelley & Ferraro on all counts but one, for which it awarded Ms. Kelley $4.2 million. Ms. Kelley's lawyer, Bill Wuliger, appealed the decision to a state appeals court, contending there were errors before, during and after the trial. The Eighth Ohio District Court of Appeals ordered in June 2010 that the firm be dissolved, per the partnership agreement, and ordered a new trial held regarding the damages Ms. Kelley suffered, if any, as a result of Mr. Ferraro's breach of contractual and fiduciary duties. The contract requires 40% of the firm's revenues to be paid to the Kelley estate. Ms. Kelley, he said, is owed well over $35 million and has received a couple hundred thousand dollars to date. Kelley & Ferraro LLP -- http://www.kelley-ferraro.com/-- is an asbestos litigation law firm based in Cleveland, Ohio. It filed for Chapter 11 protection (Bankr. S.D. Fla. Case No. 11-11892) on Jan. 26, 2011, in Miami. Lane E. Roesch, Esq., at White & Case LLP, in Miami, serves as counsel to the Debtor. The Debtor estimated assets and debts of $1 million to $10 million as of the Petition Date. The petition was signed by James L. Ferraro, as partner. KENTUCKIANA MEDICAL: Gets $200,000 Loan from Hall-Robb ------------------------------------------------------ Ben Zion Hershberg, writing for Louisville, Kentucky-based Courier-Journal, reports that a short-term $200,000 loan from the Hall-Robb investment group to Kentuckiana Medical Center has been approved by the bankruptcy court. The money will be used to pay ongoing expenses because Medicare hasn't paid $425,000 owed the medical center. According to the report, the investor group has purchased debt the hospital owed a Tennessee-based bank that forced it into a Chapter 11 financial reorganization in September. The debt was initially estimated at $2.5 million. How much the bank received from the Hall-Robb investment group hasn't been disclosed, but the deal was announced in U.S. Bankruptcy Court in New Albany during a hearing Jan. 20. Clarksville, Indiana-based Kentuckiana Medical Center LLC filed for Chapter 11 bankruptcy protection on September 19, 2010 (Bankr. S.D. Ind. Case No. 10-93039). David M. Cantor, Esq., at Seiller Waterman LLC, represents the Debtor. The Debtor reported $9,496,899 in assets, and $25,029,083 in liabilities. KRATON PERFORMANCE: Moody's Affirms 'B1' Corp. Family Rating ------------------------------------------------------------ Moody's Investors Service assigned ratings to Kraton Performance Polymers, Inc.'s proposed credit facility and unsecured notes, affirmed the B1 Corporate Family Rating, and changed the Outlook to Positive from Stable. Kraton's proposed credit facility, consisting of a $200 million term loan and $150 million revolver, was assigned a Ba3 (LGD3, 35%) and the proposed $200 million unsecured notes were assigned a B2 (LGD5, 75%). The ratings are subject to a final review of documentation and the closing of the refinancing with the terms and structure described to Moody's. Proceeds from the proposed facility and notes will be used to redeem the outstanding credit facility and subordinated notes. The outlook was moved to positive from stable as a result of the improved operating performance over 2010 along with the prospect of continued favorable results. "We expect Kraton's performance to remain strong through 2011 and anticipate positive rating pressure should the improvement in credit metrics be sustained," said Bill Reed, Moody's Vice President. Kraton's B1 CFR incorporates the expectation that leverage will remain below 3.0x, that margins will remain elevated, as demand is expected to stabilize or improve. Moody's expects retained cash flow metrics to remain strong, but free cash flow metrics could come under pressure as a result of elevated working capital, from raw material volatility, and increased capital expenditures, earmarked toward efficiency and profitability programs at existing plants. Ratings Assigned: Issuer: Kraton Performance Polymers, Inc. -- Gtd. Senior Secured Revolver, Assigned Ba3, LGD3, 35% -- Gtd. Senior Secured Term Loan, Assigned Ba3, LGD3, 35% -- Gtd. Senior Unsecured Notes due 2019, Assigned B2, LGD5, 76% Outlook Actions: Issuer: Kraton Performance Polymers, Inc. -- Outlook, Changed To Positive from Stable Ratings Affirmed: -- Corporate Family Rating, Affirmed at B1 -- Probability of Default Rating, Affirmed at B1 -- Gtd. Senior Secured Revolver, Affirmed at Ba3, LGD3, 35% from Ba3, LGD3, 31% * -- Gtd. Senior Secured Term Loan, Affirmed at Ba3, LGD3, 35% from Ba3, LGD3, 31% * -- Gtd. Senior Subordinated Global Notes, Affirmed at B3, LGD6, 97% from B3, LGD5, 82% * Moody's positive outlook reflects Kraton's improved margins through 2010 and that they have exceeded our adjusted leverage ratio target, demonstrated by the September 30, 2010, LTM 2.3x ratio. The outlook further anticipates that Kraton will continue the improved profitability into 2011, capitalizing on tightness in raw materials and improved volumes. Moody's could raise the ratings if the company is able to sustain the improved credit metrics; adjusted leverage below 3.0x and Retained Cash Flow/Debt better than 20%. Moody's would also look for the company to maintain their conservative fiscal policies pertaining excess cash flow and demonstrate a sustainable resolve to continued improvement in the company's credit profile. Moody's most recent announcement concerning the ratings for Kraton was on May 14, 2010, when the ratings were raised following the company's successful initial public offering and improved credit profile. The principal methodology used in this rating were Moody's Global Chemical Industry rating methodology published December 2009, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Kraton, headquartered in Houston, Texas, is a leading global producer of styrenic block copolymers, or SBCs, which are synthetic elastomers used in industrial and consumer applications to impart favorable product characteristics such as flexibility, resilience, strength, durability and processability. Major end uses for Kraton's products include personal care products, packaging and films, IR Latex, adhesives, sealants, coatings, and compounds. Kraton also makes products that serve the paving and roofing industries. The company generated revenues of $1.2 billion for the LTM period ending September 30, 2010. KRATON POLYMERS: S&P Upgrades Corp. Credit Rating to 'BB-' ---------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Houston, Texas-based Kraton Polymers LLC to 'BB-' from 'B+'. At the same time, S&P removed the ratings from CreditWatch, where they had been placed on Nov. 15, 2010, with positive implications. The outlook is stable. S&P assigned a 'BB+' issue-level rating and '1' recovery rating to the proposed $350 million in senior secured facilities, which consist of a $150 million revolving credit facility and a $200 million term loan A facility. The '1' recovery rating reflects S&P's expectation for a very high (90%-100%) recovery in the event of a payment default. S&P also assigned a 'BB-' issue-level rating and '4' recovery rating to the proposed $200 million in senior unsecured notes. The '4' recovery rating reflects S&P's expectation for an average (30%-50%) recovery in the event of a payment default. The $400 million in proceeds from the proposed $200 million term loan A facility and proposed $200 million in senior unsecured notes will pay off existing debt of about $383 million with the remainder applied toward transaction fees and expenses. "The upgrade reflects our expectation that favorable business conditions and operating trends in the near to intermediate term will continue to support adequate cash flow generation and liquidity and a financial risk profile consistent with the ratings," said Standard & Poor's credit analyst Henry Fukuchi. Operating trends have been favorable in the past year because of the Company's ability to pass on raw material price increases more efficiently, new product introductions, various cost saving initiatives implemented since 2007 that have reduced costs by over $55 million on an annual basis, and the rebound of volumes back to pre-recession levels. KROME XPRESS: Case Summary & 15 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Krome Xpress, Inc. 1460 N. Krome Avenue Florida City, FL 33034 Bankruptcy Case No.: 11-12124 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Southern District of Florida (Miami) Judge: Robert A. Mark Debtor's Counsel: Robert C. Meyer, Esq. ROBERT C. MEYER PA 2223 Coral Way Miami, FL 33145 Tel: (305) 285-8838 Fax: (305) 285-8919 E-mail: meyerrobertc@cs.com Scheduled Assets: $1,967,000 Scheduled Debts: $4,495,559 A list of the Company's 15 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flsb11-12124.pdf The petition was signed by Luis Vargas, president. Debtor-affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Luis Vargas 10-46377 11/29/10 LA UNIFIED SCHOOL DISTRICT: Facing $10-Bil. Healthcare Liability ---------------------------------------------------------------- The Press-Telegram in Long-Beach, Calif., reports the Los Angeles Unified School District could be forced into bankruptcy amid a $10 billion unfunded liability for current and retired LAUSD employees' health care. According to the Press-Telegram, the district spends 13% of its general fund budget on employee and retiree health care. If the district wanted to set aside more money to help reduce that $10 billion unfunded liability, health care would eat up 25% of the general fund, the Press-Telegram says. The Press-Telegram relates outgoing LAUSD Superintendent Ramon Cortines declared the health care liability "astronomical." He told the board: "If we don't address this, we won't have to worry about inadequate state funding bankrupting the district . . . This will bankrupt the district." According to the Press-Telegram, district officials sounded the alarm as well in 2006. At that time the unfunded liability was also $10 billion, and officials planned to meet with union leaders to hash out options to reduce the liability. The report says the teachers' union agreed to up the requirement for lifetime health care benefits to new hires who worked 25 years of consecutive service -- compared to requirements of 5, 10 and 15 years of consecutive service in previous contracts. But more major cost- saving measures, such as ending health care coverage when retirees are eligible for Medicare or eliminating lifetime coverage for new hires, were left off the table. LANDMARK MEDICAL: Accelerates Sale Process to Preserve Jobs ----------------------------------------------------------- The Providence Journal Co.'s projo.com reports that Landmark Medical Center, after searching unsuccessfully for a buyer for 2� years, has now proposed to find a new owner and sign an asset- purchase agreement within 13 weeks. Landmark has been under court supervision, a kind of receivership, since it came to the brink of bankruptcy in 2008. It has been also seeking for a buyer for two and a half years. According to the report, Chafee spokesman Michael Trainor said the stepped-up pace reflects a decision by the Chafee administration that "in the best interest of preserving access to jobs and care at Landmark Medical Center, the process needs to be accelerated." The Providence Journal quoted Landmark spokesman Bill Fischer as saying, "There is no danger of the hospital closing its doors any time soon, certainly in this calendar year." If necessary, the hospital could further extend its life by selling assets, Mr. Fischer said. The hospital and state regulators filed a motion in Superior Court on January 25 that sets a deadline of March 25 to receive bids from prospective purchasers, March 28 to choose one, and 15 days after that to sign a sales agreement for the court to review, according to the Providence Journal. The Providence Journal notes that the time line requires approval from Judge Michael A. Silverstein, who is expected to schedule a hearing soon. But Jonathan N. Savage, the court-appointed "special master" who has been running the hospital, said he expects to meet the new deadlines. Landmark Medical Center is a 214-bed hospital based in Woonsocket, Rhode Island. LARRY WILCOX: Escapes Jail Time for Penny Stock Scheme ------------------------------------------------------ Liz Skinner at InvestmentNews reports that Former "CHiPs" star Larry Wilcox was sentenced by U.S. District Court Judge James I. Cohn in Fort Lauderdale, Florida, to three years' probation, 500 hours of community service and ordered to pay $100 for his role in a penny stock kickback scheme. He pleaded guilty to the charges in November. The report notes that Mr. Wilcox still faces a tough road ahead. The Securities and Exchange Commission has filed fraud charges against the actor for participating in interrelated kickback schemes with two other penny stock company executives: Alex Parsinia, CEO of Zcom Networks Inc., and Anthony Mellone, former chief executive of Tri-Star Holdings Inc., a gold-mining company. Mr. Wilcox is president and chief executive of UC Hub Group Inc., a mining and precious-metals specialist founded in 1999. Mr. Wilcox has already agreed to an SEC injunction that bars him from being an officer or director in a company. But the civil penalty he might have to pay, along with any disgorgement, is still pending. Larry Dee Wilcox and his wife Marlene Rae Wilcox filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 10-21156) on Sept. 7, 2010 in San Fernando Valley, California. Kenneth Jay Schwartz, Esq., in Woodland Hills, California, represents the Debtors. The Joint Debtors estimated assets and debts of $1,000,001 to $10,000,000 as of the Petition Date. LEED CORPORATION: To Make Adequate Protection Payments to IMT ------------------------------------------------------------- On January 25, 2011, Idaho Mutual Trust, LLC, a secured creditor of the Leed Corporation, filed with the U.S. Bankruptcy Court for the District of Idaho a Stipulation for Adequate Protection and for Plan Treatment with respect to its filed proof of claim in the amount of $204,594 in the Debtor's bankruptcy case. IMT asserts a secured interest in the Debtor's real property known as Parcel No. 2A of Lot 2 of Green Acres Subdivision, Lincoln County, Idaho, commonly known as 275 E. 506 N., Shoshone, Idaho. On November 30, 2010, IMT requested the Court for termination of the stay to allow it to foreclose on the Property. Subsequently Leed and IMT agreed to resolve the issues presented by IMT in its motion pursuant to the following Stipulation: -- For the purposes of this Stipulation, the current fair market value of the Property is stipulated to be $125,000. -- Leed will, as adequate protection and plan treatment, pay $125,000 according to the following schedule: a. $500 a month pending confirmation, with the first payment due and payable on or before March 1, 2011, and subsequent payments due on or before the first of each month thereafter; b. $500.00 a month for the first 12 months post-confirmation; c. $550.00 a month for the 13th through 24th months post- confirmation; d. $600.00 a month for each month thereafter; and e. On or before the expiration of seven (7) years post- confirmation, the remaining unpaid balance of the Stipulated Amount, plus accrued interest, will be due and payable. f. The balance of IMT's claim, $79,594, will be treated as an unsecured claim in any proposed Plan of Reorganization submitted by Leed for confirmation. -- Simple interest will accrue on the $125,000.00 from the date of Court approval of this Stipulation on a variable rate, adjusted monthly consisting of the Wall Street Journal prime rate plus 1.5%. The WSJ prime rate is currently 3.25%; thus, the initial interest rate would be 4.75%. There is no prepayment penalty. -- Payments will be applied first towards accrued interest, then to the remaining principal on the Stipulated Amount. -- In the event Leed fails to make a monthly payment as required above, stay relief, as applicable, may be entered after IMT provides written notice of default to Leed and Leed's counsel of record at their respective addresses on file with the Court. Leed will have ten (10) days from service of the notice of default in which to cure the default under this Stipulation. In the event stay relief is granted, the Stipulated Amount will be disregarded and have no force or effect with respect to any foreclosure proceedings. Also, the Unsecured Claim will be reduced in an amount equal to any proceeds from the sale of the Property that exceed the Stipulated Amount. -- In the event Leed's case is dismissed for any reason, this Stipulation will be void and have no force or effect on IMT's rights and remedies at state law to enforce its Note and corresponding Deed of Trust, as if no bankruptcy had been filed. In the event Leed's case is converted to a different chapter of the Bankruptcy Code for any reason, this Stipulation will be void and have no force or effect on IMT. -- Leed agrees to incorporate the terms of this Stipulation in any proposed Plan of Reorganization submitted by Leed for confirmation and IMT is willing to consent to a Plan of Reorganization under the terms and conditions stated herein. -- The Stipulation is subject to Court approval. Leed will be responsible for seeking Court approval of this Stipulation in a timely fashion. In the event the Court refuses to approve this Stipulation, the terms of this Stipulation will not be binding upon the parties and will be of no further force and effect. A complete text of the Stipulation is available for free at: http://bankrupt.com/misc/LeedCorp.StipulationonPlanTreatment.pdf About The Leed Corporation Twin Falls, Idaho-based The Leed Corporation -- dba Green Cut Sprinklers and Landscaping, Leed Corp., Quality Built Homes, Green Cut Construction, Shoshone Developers, Desert Green Sprinklers & Landscaping, Green Cut Lawn Care, and Desert Green -- is a real estate developer, including construction and land development, well as landscaping and related care and maintenance in southern Idaho, primarily based out of Shoshone, Idaho. The Company filed for Chapter 11 protection on April 29, 2010 (Bankr. D. Idaho Case No. 10-40743). Robert J. Maynes, Esq., who has an office in Idaho Falls, Idaho, assists the Debtor in its restructuring effort. The Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts in its Chapter 11 petition. LEHMAN BROTHERS: Files 4th Quarter Report on Claims Settlements --------------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliated debtors filed a quarterly report of the transactions they entered into with these creditors to settle general unsecured claims for the period October 1 to December 31, 2010: Filed Settled Creditors Claim No. Claim Amount Claim Amount --------- --------- ------------ ------------ IKB Deutsche Industriebank 28430 $6,379,879 $4,597,869 AG, London Branch Prospect Mountain Fund Ltd. 21913 Unliquidated $907,363 Ore Hill Hub Fund Ltd. 21914 Unliquidated $396,362 Bonton Media Group Inc. 22097 Unliquidated $6,450,000 Oaktree High Yield Plus 18833 $420,778 $297,102 Fund L.P. Sumitomo Mitsui Banking Corp. 21512 $5,625 $5,625 Europe Limited Golddentree Loan 14974 $2,369 $2,369 Opportunities IV Ltd. Laurelin II BV 14975 $23,508 $23,399 Golden Tree Loan 15036 $3,026 $3,026 Opportunities V, Ltd. Golden Tree Loan 15037 $656 $656 Opportunities III Ltd. Laurelin B.V. 15038 $11,416 $11,363 Golden Tree Credit Opportunities Financing I Ltd 15040 $2,840,292 $2,404,827 Golden Tree Asset Management 15041 $10,033,032 $6,384,357 Lux SARL GoldenTree 2004 Trust 15073 $1,842,175 $695,950 The Debtors filed the quarterly report in compliance with the Court's March 31, 2010 order, which approved a process for the settlement of pre-bankruptcy claims. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Merit Wants Plan Exclusivity Until June 15 ----------------------------------------------------------- Merit LLC and two other debtor affiliates of Lehman Brothers Holdings Inc. ask the U.S. Bankruptcy Court for the Southern District of New York to extend the period during which they have exclusive right to file and solicit votes for their restructuring plans of reorganization. In a motion, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC seek to extend the deadline for filing their Chapter 11 plans to June 15, 2011, and for soliciting votes to those plans to August 15, 2011. The Lehman units sought for bankruptcy protection in December 2009, more than a year after LBHI and its other affiliates filed their bankruptcy cases. Shai Waisman, Esq., at Weil Gotshal & Manges LLP, in New York, says the Lehman units will spend the next four months to engage in talks with their creditors for a consensual resolution of their Chapter 11 cases and to complete a review of their assets as well as the claims filed by creditors. The Court will consider the proposed extension at the hearing on February 16, 2011. The deadline for filing objections is February 9, 2011. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Proposes Settlement With Swedbank -------------------------------------------------- Lehman Brothers Holdings Inc. and Lehman Commercial Paper Inc. seek court approval of an agreement with New York-based Swedbank AB to settle the Swedish bank's claims. Swedbank filed deficiency claims, assigned Claim Nos. 67079 and 67080, against the Lehman units each asserting $565,870,087 on account of LCPI's failure to repurchase commercial mortgage loans as required under a 2002 repurchase agreement. LBHI guaranteed LCPI's payment obligations to the Swedish bank under the agreement. The settlement deal calls for the exchange of certain commercial real estate loans between the Lehman units and Swedbank and to revise the terms of some loans. It also requires LBHI to pay $10 million to Swedbank as additional consideration for the exchange of loans and provides for the allowance of each of the deficiency claims in the sum of $325 million. Each of the loans subject to the exchange corresponds to a real estate project in which Swedbank and the Lehman units have direct or indirect debt or equity investments. The properties are in Manhattan, Los Angeles, Hawaii, and Austin, Texas. Alfredo Perez, Esq., at Weil Gotshal & Manges LP, in Houston, Texas, says the exchange would allow the Lehman units to consolidate their ownership in the capital structure of those projects and maximize the value of their interest in those assets. "The settlement agreement provides the best framework to resolve their disputes with Swedbank over the deficiency claim and avoid the expense and risk inherent in litigating such a claim," Mr. Perez says. The settlement deal is formalized in a 28-page agreement, a copy of which is available for free at: http://bankrupt.com/misc/LBHI_SettlementDealSwedbank.pdf The Court will hold a hearing on February 16, 2011, to consider approval of the proposed settlement. The deadline for filing objections is February 9, 2011. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LIVEMERCIAL AVIATION: Case Converted to Ch. 7 Liquidation --------------------------------------------------------- Teresa Auch Schultz at the Post-Tribune reports that a federal bankruptcy judge converted the Chapter 11 bankruptcy case of Livemercial Aviation Holding to Chapter 7 liquidation proceeding at the behest of U.S. Trustee Nancy Gargula. Livemercial Aviation Holding, LLC, filed for chapter 11 protection this year (Bankr. N.D. Ind. Case No. 10-20051). It disclosed less than $10 million in assets. According to the report, Valparaiso businessman Johnny Mathis Jr. owns Livemercial Aviation. Mr. Mathis sent the Company to Chapter 11 after it couldn't make payments on a loan it had taken out to buy a plane. PNC Bank, which held the loan, and Mr. Mathis had originally come to an agreement that gave him until the end of the year to sell the plane, but the bank ended up repossessing it last summer. LODGENET INTERACTIVE: Mast Entities Hold 7.2% Equity Stake ---------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on January 28, 2011, Mast Capital Management, LLC disclosed that it beneficially owns 1,800,000 shares of common stock of LodgeNet Interactive Corporation representing 7.2% of the shares outstanding. Other affiliates of Mast Capital also disclosed beneficial ownership of shares of the Company: Shares Equity Beneficially Owned Stake ------------------ ------ Mast Credit Opportunities I Master Fund 1,542,855 6.1% Mast OC I Master Fund L.P. 257,145 1.0% Christopher B. Madison 1,800,000 7.2% David J. Steinberg 1,800,000 7.2% Messrs. Steinberg and Madison are the managers of Mast Capital Management, LLC, which serves as the investment adviser for Mast Credit Opportunities I Master Fund Limited and is the general partner and investment adviser of Mast OC I Master Fund L.P. The percentage of the Common Stock beneficially owned by each Reporting Person is based on a total of 25,088,164 shares of Common Stock of the Company outstanding as of November 2, 2010, as reported in the Company's most recent quarterly report on Form 10- Q for the quarterly period ended September 30, 2010. The Fund and the LP each has the power to vote and dispose all of the shares of Common Stock beneficially owned by such entity. Capital, as the investment adviser of the Fund and the investment adviser and general partner of the LP, has the authority to vote and dispose of all of the shares of Common Stock beneficially owned by the Fund and the LP. Each of Messrs. Madison and Steinberg, by virtue of his position as manager of Capital, has the authority to vote and dispose of all of the shares of Common Stock beneficially owned by the Fund and the LP. About LodgeNet Interactive Sioux Falls, South Dakota-based LodgeNet Interactive Corporation (Nasdaq:LNET), formerly LodgeNet Entertainment Corp. -- http://www.lodgenet.com/-- provides media and connectivity solutions designed to meet the unique needs of hospitality, healthcare and other guest-based businesses. LodgeNet Interactive serves more than 1.9 million hotel rooms worldwide in addition to healthcare facilities throughout the United States. The Company's services include: Interactive Television Solutions, Broadband Internet Solutions, Content Solutions, Professional Solutions and Advertising Media Solutions. LodgeNet Interactive Corporation owns and operates businesses under the industry leading brands: LodgeNet, LodgeNetRX, and The Hotel Networks. The Company's balance sheet at Sept. 30, 2010, showed $454.88 million in total assets, $509.32 million in total liabilities, and a stockholders' deficit of $54.44 million * * * Lodgenet carries a 'B3' long term corporate family rating and a 'Caa1' probability of default rating, with 'stable' outlook, from Moody's. It has 'B' long term foreign and local issuer credit ratings, with 'stable' outlook, from Standard & Poor's. "In Moody's opinion, continued cautious investment from LodgeNet's hotel customers will hamper intermediate term growth in its core hospitality services business, and over the long term competing forms of entertainment will pressure this revenue stream as the company seeks to defend its relevance to both hotel operators and hotel guests. The B3 corporate family rating incorporates these weak growth prospects, mitigated somewhat by the company's moderately high financial risk profile and demonstrated capacity to generate positive free cash flow throughout challenging economic conditions, along with a measure of stability from the monthly fees it receives from hotels regardless of occupancy," Moody's said in October 2010. LOEHMANN'S HOLDING: Shuts Down Store at Huntington Beach -------------------------------------------------------- Nang Nguyen at the Orange County Register reports that Loehmann's Holding Inc. has closed its the 15,000-square-foot store at 5 Points Plaza in Huntington Beach, California, because it was underperforming and the "company intends to refocus its resources on its operations in high-growth areas." About Loehmann's Holdings Bronx, New York-based Loehmann's Holdings, Inc., is a discount retailer with more than 60 stores. The Bronx, New York-based company is owned indirectly by Istithmar PJSC, an investment firm owned by the government of Dubai. Loehmann's filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. S.D.N.Y. Case No. 10-16077). It estimated its assets and debts at $100 million to $500 million. Affiliates Loehmann's Inc. (Bankr. S.D.N.Y. Case No. 10-16078), Loehmann's Operating Co. (Bankr. S.D.N.Y. Case No. 10-16079), Loehmann's Real Estate Holdings, Inc. (Bankr. S.D.N.Y. Case No. 10-16080), and Loehmann's Capital Corp. (Bankr. S.D.N.Y. Case No. 10-16081) filed separate Chapter 11 petitions. Frank A. Oswald, Esq., at Togut, Segal & Segal LLP, assist the Debtors in their restructuring efforts. Perella Weinberg Partners LP is the Debtors' investment banker and financial advisor. Clear Thinking Group LLC is the Debtors' restructuring adviser. Troutman Sanders LLP is the Debtor's special corporate counsel. Kurtzman Carson Consultants LLC is the Debtors' claims and notice agent. LOUISVILLE ORCHESTRA: Has Funding to Pay Musicians -------------------------------------------------- The Louisville Orchestra announced January 28 that, in deference to the recent ruling of the Bankruptcy Court, it has sought and been granted emergency funding from the "Philharmonic Trust" and the Louisville Orchestra Foundation. Each exists with independent boards and serves as separate legal entities from the Louisville Orchestra. This support will enable the Orchestra to fund its next payroll on January 31. The funding is provided as advances against future seasons' endowment allocations, and was made possible, in part, due to the sharp rise in investment markets since December. Issues concerning whether any additional funds can be obtained are continuing to be explored. About Louisville Orchestra Based in Louisville, Kentucky, Louisville Orchestra, Inc. filed for Chapter 11 bankruptcy protection on Dec. 3, 2010 (Bankr. W.D. Ky. Case No. 10-36321). Judge David T. Stosberg presides over the case. Daniel T. Albers, Jr., Esq., Mark A. Robinson, Esq., and Robert Wagner, Esq., at Valenti Hanley & Robinson PLLC, represent the Debtor. In its schedules, Louisville Orchestra disclosed it had $412,000 in assets and $1.4 million in liabilities. MAJESTIC STAR: Hiring Fine Point as Casino Adviser -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that to comply with provisions of its reorganization plan that require a financial adviser when it emerges from Chapter 11, Majestic Star Casino LLC filed a motion last week to hire The Fine Point Group, a consultant specializing in the gambling industry. Fine Point will be paid $100,000 a month for several months. The plan confirmation hearing is scheduled for March 10, 2011, at 2:30 p.m. Objections to confirmation of the Plan must be filed with the Court no later than 4:00 p.m. on March 1, 2011. Chapter 11 Plan As reported in the Jan. 18, 2011 edition of the Troubled Company Reporter, Bill Rochelle, the bankruptcy columnist for Bloomberg News, said the Plan, revised again on Jan. 6, offers senior secured credit facility lenders, owed $65.3 million, full payment by receiving some cash and rolling over remaining debt. If new financing is available, the existing facility will be paid in cash. Holders of $348.4 million in senior secured notes are in line for a 52% recovery from 58% of the new equity and $100.6 million in cash. If new financing isn't available, noteholders will receive new debt instead of cash. Holders of the senior notes are to be given 42% of the new equity for their roughly $233 million in debt, resulting in a 25% recovery. General unsecured creditors are being offered 25% in cash or a share in $1 million, whichever is less. Holders of $72.6 million in discount notes are to receive nothing. According to the Disclosure Statement, under the Plan, the Debtors will retain and reorganize around their casino gaming properties in Gary, Indiana, Tunica County, Mississippi, and Black Hawk, Colorado, subject, in the case of the Black Hawk, Colorado gaming property, to obtaining all governmental licenses, suitability determinations, and other approvals required for such property on or prior to 240 days following the Confirmation Date. About Majestic Star Based in Las Vegas, Nevada, The Majestic Star Casino, LLC -- aka Majestic Star Casino, aka Majestic Star -- is a wholly owned subsidiary of Majestic Holdco, LLC, which is a wholly owned subsidiary of Barden Development, Inc. The Company was formed on December 8, 1993, as an Indiana limited liability company to provide gaming and related entertainment to the public. The Company commenced gaming operations in the City of Gary at Buffington Harbor, located in Lake County, Inc., on June 7, 1996. The Company is a multi-jurisdictional gaming company with operations in three states -- Indiana, Mississippi and Colorado. The Company sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 09-14136) on November 23, 2009. The Company's affiliates -- The Majestic Star Casino II, Inc., The Majestic Star Casino Capital Corp., Majestic Star Casino Capital Corp. II, Barden Mississippi Gaming, LLC, Barden Colorado Gaming, LLC, Majestic Holdco, LLC, and Majestic Star Holdco, Inc. -- filed separate Chapter 11 petitions. The Majestic Star Casino's balance sheet at June 30, 2009, showed total assets of $406.42 million and total liabilities of $749.55 million. Kirkland & Ellis LLP is the Debtors' bankruptcy counsel. James E. O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, are the Debtors' Delaware counsel. Xroads Solutions Group, LLC, is the Debtors' financial advisor, while EPIQ Bankruptcy Solutions LLC serves as the Debtors' claims and notice agent. Michael S. Stamer, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Bonnie Glantz Fatell, Esq., and David W. Carickhoff, Esq., at Blank Rome LLP, in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. MERIDIAN MORTGAGE I: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Debtor: Meridian Mortgage Investors Fund I LLC 1420 Fifth Avenue, Suite 2200 Seattle, WA 98101 Bankruptcy Case No.: 11-10830 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Karen A. Overstreet Debtor's Counsel: Michael J. Gearin, Esq. K&L GATES LLP 925 4th Ave Suite 2900 Seattle, WA 98104-1158 Tel: (206) 623-7580 E-mail: michael.gearin@klgates.com Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Diana K. Carey, Trustee for F. Darren Berg. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Meridian Mortgage Investors Fund V, LLC 10-17952 07/09/10 MERIDIAN MORTGAGE III: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: Meridian Mortgage Investors Fund III LLC 1420 Fifth Avenue, Suite 2200 Seattle, WA 98101 Bankruptcy Case No.: 11-10833 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Karen A. Overstreet Debtor's Counsel: Michael J. Gearin, Esq. K&L GATES LLP 925 4th Ave Suite 2900 Seattle, WA 98104-1158 Tel: (206) 623-7580 E-mail: michael.gearin@klgates.com Estimated Assets: $0 to $50,000 Estimated Debts: $50,000,001 to $100,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Diana K. Carey, Trustee for F. Darren Berg. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Meridian Mortgage Investors Fund V, LLC 10-17952 07/09/10 MGM RESORTS: Kerkorian's Tracinda Has 26.9% Equity Stake -------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on January 28, 2011, each of Tracinda Corporation and Kirk Kerkorian disclosed beneficial ownership of 131,173,744 shares of common stock of MGM Resorts International representing 26.9% of the shares outstanding. As of November 1, 2010, there were 482,369,501 shares of common stock of the Company outstanding. As MGM Resorts' largest stockholder, Tracinda occasionally receives inquiries regarding the Company and Tracinda's shares of Common Stock. Tracinda monitors its investment in the Company by, among other things, contacting Company management to address operations and market conditions. Tracinda continues to believe that there is substantial value in the assets of MGM Resorts and that the Company is a good long-term investment. However, from time to time, Tracinda may explore potential transactions involving its shares of Common Stock. Tracinda may ultimately not enter into any transaction. 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. The Company's balance sheet at Sept. 30, 2010, showed $19.14 billion in total assets, $1.32 billion in total current liabilities, $2.40 billion in deferred income taxes, $12.62 billion in long-term debt, $252.21 million in other long-term obligations, and stockholder's equity of $2.54 billion * * * 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 KENWOOD: Faces SEC Charges; Assets Frozen ------------------------------------------------- The Securities and Exchange Commission on Friday obtained a court order freezing the assets of a Stamford, Conn.-based investment adviser and its principal, Francisco Illarramendi, charging that they misappropriated at least $53 million in investor funds and used the money for self-dealing transactions. The SEC alleges that Mr. Illarramendi defrauded investors in the several hedge funds he managed by improperly transferring their money into bank accounts that he personally controlled. He then invested the money for his own benefit or for the benefit of the entities that he controlled, rather than for the benefit of the hedge fund investors. "Illarramendi treated his clients' money like it was his own, diverting millions of dollars that did not belong to him," said David P. Bergers, Director of the SEC's Boston Regional Office. "He abused his position of trust with his clients and breached his responsibilities as an investment adviser." According to the SEC's complaint filed in the U.S. District Court for the District of Connecticut on January 14, Mr. Illarramendi is the majority owner of the Michael Kenwood Group LLC -- a holding company for, among other entities, investment adviser Michael Kenwood Capital Management LLC. Through this adviser entity, Mr. Illarramendi manages several hedge funds, including one that contains up to $540 million in assets. The SEC's complaint alleges that Mr. Illarramendi took at least $53 million in investor money out of this hedge fund without the knowledge or consent of the hedge fund's investors The SEC sought an asset freeze and other emergency relief because it alleged that Mr. Illarramendi was imminently planning to make additional investments using investor funds without the knowledge or consent of the investors. Since the filing of the complaint, the Honorable Janet Bond Arterton, U.S. District Judge for the District of Connecticut, has held a series of hearings pertaining to the SEC's request for an emergency relief against Mr. Illarramendi and Michael Kenwood Capital Management. Judge Arterton then entered an order freezing the assets of the defendants. The SEC's complaint charges Mr. Illarramendi and Michael Kenwood Capital Management, LLC, with violating Sections 206(1), 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The complaint also names the following Illarramendi-controlled entities as relief defendants, alleging that they received investor funds to which they have no right: Michael Kenwood Asset Management LLC, Michael Kenwood Energy and Infrastructure LLC, and MKEI Solar LP. In addition to preliminary emergency relief, the SEC's complaint seeks permanent injunctions, disgorgement of ill-gotten gains plus prejudgment interest, and civil penalties from the defendants, and disgorgement plus prejudgment interest from the relief defendants. Carlos J. Costa-Rodrigues, Sofia T. Hussain, Michelle Perillo, and LeeAnn Ghazil Gaunt of the SEC's Boston Regional Office conducted the investigation following an examination conducted by Zerubbabel Johnson, Stephen M. Latin, Michael D. O'Connell, and Elizabeth Salini. The SEC's litigation effort is being led by Rua M. Kelly. The SEC's investigation is ongoing. MINOR FAMILY: Status Hearing on Funding of Debtor Moved to Apr. 18 ------------------------------------------------------------------ Upon consideration of the motion of Minor Family Hotels, LLC, to continue the status hearing on funding of the Debtor, originally set for February 14, 2011, and because judicial economy will be served by continuing said hearing, the U.S. Bankruptcy Court has ordered that the status hearing on funding of the Debtor be continued to April 18, 2011, at 11:00 a.m. in the United States Bankruptcy Court, Courtroom 200, 255 West Main Street, in Charlottesville, Virginia. In support of its motion for continuation of the status hearing to April 18, 2011, the Debtor stated that its case will be determined in great part by litigation in Georgia, which is scheduled to be tried in mid-March, 2011. The Georgia Action referred to in the preceding paragraph is entitled: Specialty Finance Group, LLC v. Minor Family Hotels, LLC, Adv. Pro. No. 10-06112 (Bankr. W.D. Va) (action for breach of contract and fraud initially filed in the State Court of Fulton County, Georgia). As reported in the Troubled Company Reporter on December 15, 2010, District Court Judge Norman K. Moon affirmed a bankruptcy court order remanding the above referenced Adversary Proceeding to the State Court of Fulton County, Georgia. The dispute arises out of a construction loan agreement for a $23.6 million loan entered into by lender Specialty Finance Group, and by the Debtor for the purpose of funding the construction and development of a hotel on the downtown mall in Charlottesville, Virginia. The Lender alleges that because events of default occurred, it rightfully accelerated all amounts due under the loan and guaranty and sought those amounts from the Debtor and Halsey Minor as owners. The Owners allege that the Lender wrongfully failed to fund the loan and illegally colluded with developer Hotel Charlottesville, LLC, Lee Danielson, and general contractor Clancy & Theys Construction Company. About Minor Family Charlottesvile, Virginia-based Minor Family Hotels, LLC, is the owner of the Landmark Hotel project in downtown Charlottesville, Virginia. Minor Family filed for Chapter 11 bankruptcy protection (Bankr. W.D. Va. Case No. 10-62543) on September 1, 2010. Benjamin Webb King, Esq., at Woods Rogers Hazlegrove, serves as bankruptcy counsel. Minor Family estimated assets and debts at $10 million to $50 million in its Chapter 11 petition. As reported by the Troubled Company Reporter on September 3, 2010, Dow Jones' DBR Small Cap said Minor Family Hotels filed for Chapter 11 protection to resolve "burdensome" lawsuits that have delayed the hotel's construction. Eight lawsuits have been filed in connection with the project. MISSION TOWERS: Cash Collateral Use Extended Until Sale Closing --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Kansas approved the Agreed Motion of Mission Towers Properties I, LLC, and secured lender Union Bank, extending the use of cash collateral through January 31, 2011, or to a later date. Uhion Bank had requested that the Debtor extend the bid deadlines for the submission of bids and potential closing through January 31, 2011, with respect to the Debtor's real property located at 5700 Broadmoor, in Mission, Kansas. The extension of the bid deadline through closing necessitates the extension of the use of cash collateral. As agreed, in the event the closing is extended past January 31, 2011, the Debtor and Union Bank will enter into a stipulation without notice to creditors of the continued use of cash collateral. In no event will the stipulated extension extend beyond February 28, 2011. As reported in the Troubled Company Reporter on July 21, 2010, the Debtor was indebted to Union Bank in the principal amount of $7,373,787 under the First Note; the principal amount of $2,199,051 under the Second Note; and the principal amount of $2,847,137 under the Third Note. About Mission Towers Leawood, Kansas-based Mission Towers Properties I, LLC, owns a nine-story office building known as Mission Towers (the Property) in Mission, Kansas. The Company filed for Chapter 11 bankruptcy protection on July 9, 2010 (Bankr. D. Kan. Case No. 10-12286). Edward J. Nazar, Esq., who has an office in Wichita, Kansas, assists the Company in its restructuring effort. In its petition, the Debtor scheduled $11,211,322 in assets and $16,085,073 in liabilities as of the petition date. MK CUSTOM: Court Denies Sale of Maricopa County, Ariz. Property --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona has denied the motion of MK Custom Residential Construction, LLC, for the approval of the sale of its property located in Maricopa County, Arizona. On November 15, 2010, Maricopa County filed its notice of perfected liens and objection to the sale motion. On November 30, 2010, Lender ML Manager LLC, filed its objection to the sale motion. The reasons set forth on the record at the hearing were not disclosed. About MK Residential Construction, LLC Phoenix, Arizona-based MK Custom Residential Construction, LLC, filed for Chapter 11 on December 10, 2009 (Bankr. D. Ariz. Case No. 09-31909). Jerry L. Cochran, Esq., at Cochran Law Firm, PC represents the Debtor in its restructuring effort. In its schedules, the Debtor disclosed $10,000,000 in assets and $10,122,224 in liabilities as of the petition date. MOHEGAN TRIBAL: Posts Statistical Report for Mohegan Sun -------------------------------------------------------- On January 28, 2011, the Mohegan Tribal Gaming Authority posted on its Web site its Table Games Statistical Report for Mohegan Sun at Pocono Downs containing statistics relating to gross table games revenues, table games tax and weighted average number of table games. The Table Games Statistical Report includes these statistics on a monthly basis for the three months ended December 31, 2010 and the fiscal year ended September 30, 2010. A copy of the Table Games Statistical Report is available at no charge at: http://ResearchArchives.com/t/s?72a5 About Mohegan Tribal Headquartered in Uncasville, Conn., Mohegan Tribal Gaming Authority conducts and regulates gaming activities on Tribal lands, which are federally recognized Indian tribe reservations in southeastern Connecticut. The Authority's balance sheet at September 30, 2010, showed $2.20 billion in total assets, $2.07 billion in total liabilities and $132,044,000 in total capital. The Authority has noted that its Bank Credit Facility matures on March 9, 2012 and its 2002 Senior Subordinated Notes mature on April 1, 2012. In addition, a substantial portion of the Authority's remaining indebtedness matures over the following three fiscal years. The Authority believes that it will need to refinance all or part of its indebtedness at or prior to each maturity thereof in order to maintain sufficient resources for its operations. The Authority has engaged Blackstone Advisory Partners, L.P. to assist in its strategic planning relating to its debt maturities. * * * At the end of November 2010, Moody's Investors Service downgraded Mohegan Tribal Gaming Authority's Corporate Family and Probability of Default ratings to Caa2 from B3. All of MTGA's rated long-term debt was also lowered. The rating outlook is negative. The ratings downgrade reflects Moody's view that MTGA could find it difficult to refinance significant upcoming debt maturities without some impairment to bondholders given its high leverage -- debt/EBITDA is over 7 times -- limited near-term growth prospects for Mohegan Sun Casino, the likely continuation of weak consumer gaming demand trends in the Northeastern U.S., and the strong possibility of gaming in Massachusetts. The company's $675 million revolver ($527 million outstanding at September 30, 2010) expires in March 2012 and its $250 million 8% senior subordinated notes mature in April 2012. Combined, these debt items account for about 50% of MTGA's total debt outstanding. MTGA has announced that it hired Blackstone Group to help deal with its capital structure issues, although no details have been made available regarding MTGA's options. Given the company's recently announced weak fiscal fourth quarter results along with the significant near- and long-term challenges previously mentioned, Moody's believes a restructuring that involves some impairment to bondholders will be considered. The negative ratings outlook reflects the relatively short time frame in which MTGA has to address what Moody's believes to be a significant capital structure issue. If MTGA is not able to refinance by March 2011 its $675 million revolver will be become current. The same holds true for the company's $250 million 8% senior subordinated notes to the extent these notes are not refinanced by April 1, 2011. MOVIE GALLERY: Scam Seeks Payment of Late Fees ---------------------------------------------- Mandy Oaklander, writing for The Kansas City Pitch, reports that Kansas Attorney General Derek Schmidt has warned locals in a press release of a scam seeking payment of alleged Hollywood Video late fees. The report relates Mr. Schmidt said he has heard from Kansans across the state who have been sent bills or been telephoned by a company called National Credit Solutions, which purports to be a debt-collecting agency. According to victims who talked to Mr. Schmidt's office, National Credit Solutions threatens that a lack of payment will be reflected on their credit reports. The callers shadily offer to accept less than the amount "due" as long as the person pays on the spot. "This appears to be a scam," Mr. Schmidt said. "Consumers should not pay or give any information to this organization over the telephone. Instead, they should gather whatever information they can about the alleged debt and the caller and then report that to our office." About Movie Gallery Based in Wilsonville, Oregon, Movie Gallery, Inc., was the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 bankruptcy protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private- investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants served as claims and notice agent. MPM INVESTOR: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: MPM Investor Services Inc 1420 Fifth Avenue, Suite 2200 Seattle, WA 98101 Bankruptcy Case No.: 11-10834 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Karen A. Overstreet Debtor's Counsel: Michael J. Gearin, Esq. K&L GATES LLP 925 4th Ave Suite 2900 Seattle, WA 98104-1158 Tel: (206) 623-7580 E-mail: michael.gearin@klgates.com Estimated Assets: $0 to $50,000 Estimated Debts: $50,000,001 to $100,000,000 The petition was signed by Diana K. Carey, Trustee for F. Darren Berg. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Meridian Mortgage Investors Fund V, LLC 10-17952 07/09/10 NETWORK CN: Posts $416,500 Net Loss in September 30 Quarter ----------------------------------------------------------- Network CN Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $416,489 on $733,440 of revenues for the three months ended September 30, 2010, compared with a net loss of $1.1 million on $293,706 of revenues for the same period of 2009. The Company's balance sheet at September 30, 2010, showed $2.5 million in total assets, $5.9 million in total liabilities, and a stockholders' deficit of $3.4 million. Baker Tilly Hong Kong Limited, in Hong Kong, expressed substantial doubt about Network CN Inc.'s ability to continue as a going concern, following the Company's results for 2009. The independent auditors noted that the Company has incurred net losses of $37,359,188 for the year ended December 31, 2009. Additionally, during the year ended December 31, 2009, the Company has used cash flow in operations of $5,428,273, and as of December 31, 2009, recorded a stockholders' deficit of $1,491,206. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?72a7 On January 28, 2011, the Company filed Amendment No. 1 to its quarterly report for the quarterly period ended September 30, 2010, solely to amend the Company's disclosures under Part I - Item 2 "Management's Discussion and Analysis of Financial Condition and Results of Operations." A full-text copy of the Form 10-Q/A is available for free at: http://researcharchives.com/t/s?72a8 Also on January 28, 2011, the Company filed Amendment No. 1 to its annual report on Form 10-K for the fiscal year ended December 31, 2009, originally filed with the U.S. Securities and Exchange Commission on March 31, 2010, solely to amend the Company's disclosures throughout the Original Report, including under Item 1. "Business," Item 1A. "Risk Factors," Item 5 "Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities," Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations," Item 10 "Directors, Executive Officers and Corporate Governance," Item 11 "Executive Compensation," Item 12 "Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters," Item 13 "Certain Relationships and Related Transactions, and Director Independence," and Item 15 "Exhibits, Financial Statement Schedules." Full-text copies of the Form 10-K/A and the original Form 10-K report are available for free at: http://researcharchives.com/t/s?72a9 http://researcharchives.com/t/s?72aa Network CN Inc. (OTC BB: NWCN) -- http://www.ncnmedia.com/-- together with its subsidiaries, provides out of home advertising services. Network CN Inc. was incorporated in the State of Delaware in 1993 and is headquartered in Causeway Bay, Hong Kong. NORTHERN STAR MINING: Files BIA Proposal; Deloitte is Trustee ------------------------------------------------------------- Deloitte & Touche Inc. was appointed trustee in the bankruptcy of Northern Star Mining Corp. last week. NSM and its subsidiary, Jake Resources Ltd., did not seek a further extension of the period in which to file a proposal under the Bankruptcy and Insolvency Act (Canada), which expired on January 24. As a consequence, NSM and Jake Resources were deemed to have filed assignments in bankruptcy, and NSM's officers and directors have resigned. On August 18, 2010, the Company filed a Notice of Intention to Make a Proposal under the BIA. The Filing resulted in an initial automatic 30-day stay of proceedings which protects the Company from its creditors. The effect of the Order made on November 26, 2010, is to extend that stay until January 24, 2011. While under protection from its creditors, the Company's board of directors maintained its usual role and its transfer agent remained Computershare Trust Company of Canada. For more information, please contact: Hartley Bricks Deloitte & Touche Inc. Telephone: 416-775-7326 Val-D'Or, Quebec-based Northern Star Mining Corp. (TSX Venture Exchange: NSM) controls 100% of the Malartic Midway project. The focus of Northern Star is to explore for precious metals within the traditionally mineral rich camp. NUVILEX INC: Posts $45,820 Net Loss in October 31 Quarter --------------------------------------------------------- Nuvilex Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $45,820 on $15,869 of revenues for the three months ended October 31, 2010, compared with a net loss of $514,343 on $70,171 of revenues for the same period of 2009. The Company's balance sheet at October 31, 2010, showed $1.2 million in total assets, $3.3 million in total liabilities, and a stockholders' deficit of $2.1 million. M&K CPAS, PLLC, in Houston, expressed substantial doubt about Nuvilex's ability to continue as a going concern, following the Company's results for the fiscal year ended April 30, 2010. The independent auditors noted that the Company has suffered recurring losses from operations. A full-text copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?72a6 Scottsdale, Ariz.-based Nuvilex Inc. (OTC BB: NVLX) -- http://www.nuvilex.com/-- operates independently and through wholly-owned subsidiaries and is dedicated to bringing to market scientifically derived products designed to improve the health and well-being of those who use them. The Company currently manufactures, directly or indirectly through independent contractors Cinnergen(TM), Cinnechol(TM), Infinitink(R) (and related private label ink products), and Talysn(TM) Scar Cream for sale worldwide. Nuvilex markets its products both directly and through retail distribution partners. The Company's retail distribution partners include The Vitamin Shoppe and other regional retail establishments. ORANGE COUNTY CHOPPERS: Foreclosure Suit Sparks Bankruptcy Rumors ----------------------------------------------------------------- Fred Meier at USA Today reports that a flurry of rumors flew around the Web last week that the TV-famous Orange County Choppers was bankrupt. Paul Teutel Sr.'s bike works has a long history of legal melodrama, Mr. Meier relates, including the nasty lawsuit between colorful Paul Sr. and Jr., as Junior went his own way. But the current posts making the rounds refer to a foreclosure lawsuit actually filed in November (according to a report at http://is.gd/iQh4Xxin OCC's hometown Newburgh, N.Y., newspaper) by GE Capital, the lender for OCC's headquarters building. According to the report, the bike works, like lots of homes, is underwater on its two mortgages. It missed payments in July, which OCC's lawyer told the Times-Herald Record was a ploy to get GE to renegotiate the $12.5 million in loans on a building he estimates now worth no more than $8 million. OCC and GE apparently are playing chicken, but Paul Sr.'s lawyer: Richard M. Mahon, II, Esq. Tarshis, Catania, Liberth, Mahon & Milligram, PLLC One Corwin Court Newburgh, NY 12550 Telephone: (845) 565-1100 E-mail: rmahon@tclmm.com told the paper that OCC and Paul Sr., in November at least, were not broke. OTTER TAIL: Court OKs OTAV-Led Auction on Feb. 16 ------------------------------------------------- BankruptcyData.com reports that the U.S. Bankruptcy Court approved Otter Tail's bid procedures related to the sale of its ethanol manufacturing plant to stalking horse bidder OTAV LLC for $62.5 million or to the highest bidder. According to BData, competing bids are due February 11 and an auction, if necessary, will be held on February 16, 2011. 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). Attorneys at Mackall, Crounse & Moore, PLC, represent the Debtor in the Chapter 11 case. Carl Marks Advisory Group LLC is the financial advisor. 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. OWENS CORNING: Garlock Wants to Access Rule 2019 Statements ----------------------------------------------------------- Garlock Sealing Technologies LLC asks the U.S. Bankruptcy Court for the District of Delaware and the U.S. Bankruptcy Court for the Western District of Pennsylvania for authority to access exhibits of statements pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure filed in the Chapter 11 cases of certain debtors, but omitted from the electronic docket pursuant to orders of the courts requiring a motion to obtain access. Garlock Sealing specifically seeks authority from the Delaware Court to access documents in the cases of: * Owens Corning, * ACandS, Inc., * Armstrong World Industries, Inc., * Combustion Engineering, Inc., * The Flintkote Company, * Kaiser Aluminum Corp., * US Mineral Products Company, * USG Corp., and * W.R. Grace & Co. Likewise, Garlock Sealing seeks authority from the Pennsylvania Court to access documents in the cases of: * Mid-Valley, Inc., * North American Refractories Co., and * Pittsburgh Corning Corp. In addition, Garlock Sealing also seeks authority to intervene in each of the Subject Debtors' Chapter 11 cases and seeks to reopen any that are presently closed to the extent necessary for the Courts to provide it with the relief it seeks. Gregory W. Werkheiser, Esq., at Morris Nichols Arsht & Tunnell LP, in Wilmington, Delaware, says that the public is presumptively entitled to obtain access to documents filed in federal courts, unless a party objecting to access can demonstrate that disclosure will cause a "clearly defined and serious injury." He notes that at the time it entered the 2019 Orders, the Courts deferred decision on who would have access to the full 2019 statements, instead providing that the exhibits would be sequestered off the electronic docket, and that members of the public could file a motion to obtain access, at which time the appropriate Court would decide the access question. "Garlock [Sealing] is a member of the public and, furthermore, is likely a party in interest in all the cases, as a company that was routinely sued in asbestos personal injury cases with the Debtors," Mr. Werkheiser contends. Although Garlock Sealing need not show cause to obtain access, it has an urgent need to obtain the full 2019 statements for use as evidence in its own pending bankruptcy case, Mr. Werkheiser emphasizes. Garlock Sealing is a manufacturer of sealing products, headquartered in Palmyra, New York. The company formerly manufactured asbestos-containing products, principally gaskets and packing containing encapsulated asbestos, and has been a defendant in lawsuits alleging asbestos-related personal injury for over 35 years. Garlock Sealing wants to obtain access to documents filed in the Chapter 11 cases that are relevant to estimation and other matters in its bankruptcy case, Mr. Werkheiser relates. He notes that beginning in 2004, the Courts began to require asbestos plaintiffs' firms representing multiple creditors to file Rule 2019 Statements. The Courts required each firm to file a verified statement identifying the name and address of the entity filing the statement. The Courts also required the 2019 Statements to be supplemented every 90 days. By comparing exhibits in the Rule 2019 Statements to the discovery Garlock was simultaneously receiving in the tort system, Garlock can determine whether lawyers and claimants were lying in one or both forums, Mr. Werheiser says. He explains that the Rule 2019 Statements show when plaintiffs' firms knew that their clients were creditors in the cases, and thus when firms knew their clients had been exposed to products for which the bankrupts were responsible. "By comparing these verified statements to discovery Garlock received over the past decade, Garlock can prove the extent to which plaintiffs' firms were concealing evidence of alternative exposures in order to inflate Garlock's settlement values," Mr. Werkheiser asserts. He also notes that "if Garlock's past settlements were inflated by fraud and abuse, they present an unreliable guide to its current and future liability for asbestos claims, unless discounted to account for the fraud and abuse." Garlock Seeks to Limit Notice Garlock sought and obtained an order from the Delaware Court providing that Garlock's notice of its Motion to Unseal will be served on (i) all law firms for asbestos personal injury claimants that have filed Rule 2019 Statements and that Garlock Sealing seeks to have unsealed, (ii) counsel of record for the Debtors in each of the Bankruptcy Cases, (iii) counsel for any statutory committee appointed in the Bankruptcy Cases, (iv) counsel for all trustees of any trusts created in the Bankruptcy Cases pursuant to Section 524(g) of the Bankruptcy Code, and (v) the Office of the United States Trustee for the districts in which each of the Bankruptcy Cases is venued, (vi) all Notice Parties, and (vii) all those who have filed requests for notices in each of the cases. About Garlock Sealing Headquartered in Palmyra, NY, Garlock Sealing Technologies LLC is an EnPro Industries, Inc. company (NYSE: NPO). For more than a century, Garlock has been helping customers efficiently seal the toughest process fluids in the most demanding applications. On June 5, 2010, Garlock filed a voluntary Chapter 11 petition (Bankr. W.D. N.C. Case No. 10-31607) in Charlotte, North Carolina, to establish a trust to resolve all current and future asbestos claims against Garlock under Section 524(g) of the U.S. Bankruptcy Code. The Debtor estimated $500 million to $1 billion in assets and up to $500 million in debts as of the Petition Date. Affiliates The Anchor Packing Company and Garrison Litigation Management Group, Ltd., also filed for bankruptcy. The filing covers only Garlock operations in Palmyra, New York and Houston, Texas. Garlock Rubber Technologies, Garlock Helicoflex, Pikotek, Technetics, Garlock Europe and Garlock operations in Canada, Mexico or Australia are not affected by the filing, nor is EnPro Industries or any other EnPro operating subsidiary. Albert F. Durham, Esq., at Rayburn Cooper & Durham, P.A., represents the Debtor in its Chapter 11 effort. Garland S. Cassada, Esq., at Robinson Bradshaw & Hinson, serves as counsel for asbestos matters. The Official Committee of Asbestos Personal Injury Claimants in the Chapter 11 cases is represented by Travis W. Moon, Esq., at Hamilton Moon Stephens Steele & Martin, PLLC, in Charlotte, NC, Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, in New York, and Trevor W. Swett III, Esq., Leslie M. Kelleher, Esq., and Jeanna Rickards Koski, Esq., in Washington, D.C. 20005. Joseph W. Grier, III, the Court-appointed legal representative for future asbestos claimants, has retained A. Cotten Wright, Esq., at Grier Furr & Crisp, PA, and Richard H. Wyron, Esq., and Jonathan P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, as his co- counsel. About 124,000 asbestos claims are pending against Garlock in state and federal courts across the country. The Company says majority of pending asbestos actions against it is stale and dormant -- almost 110,000 or 88% were filed more than four years ago and more than 44,000 or 35% were filed more than 10 years ago. A schedule of the pending asbestos actions is available for free at: http://bankrupt.com/misc/Garlock_PendingAsbestosActions.pdf About Owens Corning Headquartered in Toledo, Ohio, Owens Corning fka Owens Corning (Reorganized) Inc. (NYSE: OC) -- http://www.owenscorning.com/-- is a producer of residential and commercial building materials and glass fiber reinforcements, and other similar materials for composite systems. The company has operations in 26 countries. The Company filed for Chapter 11 protection on October 5, 2000 (Bankr. D. Del. Case. No. 00-03837). Norman L. Pernick, Esq., at Saul Ewing LLP, represented the Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Official Committee of Asbestos Creditors. James J. McMonagle served as the Legal Representative for Future Claimants until June 20, 2007. Mr. McMonagle was replaced by Michael J. Crames. Mr. Crames served as Mr. McMonagle's counsel until July 2005, when he retired from the law firm Kaye Scholer LLP. On September 28, 2006, the Honorable John P. Fullam, Sr., of the U.S. District Court for the Eastern District of Pennsylvania affirmed the order of Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware confirming Owens Corning's Sixth Amended Plan of Reorganization. The Plan took effect on October 31, 2006, marking the company's emergence from Chapter 11. Reorganized Owens sought on July 25, 2008, from the Delaware Bankruptcy Court a final decree closing the Chapter 11 cases of 17 of its affiliates. Only the Chapter 11 case of Owens Corning Sales, LLC, formerly known as Owens Corning, under Case No. 00-03837 will remain open. (Owens Corning Bankruptcy News; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) * * * Reorganized Owens Corning carries a 'Ba1' corporate family rating from Moody OWENS CORNING: P.I. Claimants Send Letters Seeking Claims Payment ----------------------------------------------------------------- Autry Earl Barney, a personal injury claimant, sent a letter addressed to the U.S. Bankruptcy Court for the District of Delaware seeking settlement for an alleged claim that was previously submitted against "Owens-Corning." In response, the Court ordered the Owens Corning/Fibreboard Asbestos Personal Injury Trust to respond to Mr. Barney's inquiry. The PI Trust submitted a response, but it is asking the Court to have the response filed under seal to comply with the confidentiality provisions of the Asbestos Personal Injury Trust Distribution Procedures. The Court subsequently granted the PI Trust's confidentiality request. Owens Corning Answers Mr. Barney Adam H. Isenberg, Esq., at Saul Ewing LLP, in Wilmington, Delaware, the Reorganized Debtors' bankruptcy counsel, tells Mr. Barney that according to the firm's records, he entered into a settlement agreement with: -- Owens Corning in July 1992 for a certain amount, a portion of which was paid to Nutt & Associates P.C. and Ness Motley Loadholt Richardson and Poole, Mr. Barney's attorneys; and -- Fibreboard Corporation in June 1992 for a certain amount. Mr. Isenberg notes that records did not indicate whether Mr. Barney shared the Fibreboard Settlement Payment with his attorneys, who are listed as Cupit Jones & Fairbank. F. Carillo Sends Letter Another letter due to a death caused by asbestos was delivered to the Court. The letter is from Francisco Carillo who is asking "justice" for his mother's death. The Court answered Mr. Carillo and directed him to address his inquiries and requests to the PI Trust. About Owens Corning Headquartered in Toledo, Ohio, Owens Corning fka Owens Corning (Reorganized) Inc. (NYSE: OC) -- http://www.owenscorning.com/-- is a producer of residential and commercial building materials and glass fiber reinforcements, and other similar materials for composite systems. The company has operations in 26 countries. The Company filed for Chapter 11 protection on October 5, 2000 (Bankr. D. Del. Case. No. 00-03837). Norman L. Pernick, Esq., at Saul Ewing LLP, represented the Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Official Committee of Asbestos Creditors. James J. McMonagle served as the Legal Representative for Future Claimants until June 20, 2007. Mr. McMonagle was replaced by Michael J. Crames. Mr. Crames served as Mr. McMonagle's counsel until July 2005, when he retired from the law firm Kaye Scholer LLP. On September 28, 2006, the Honorable John P. Fullam, Sr., of the U.S. District Court for the Eastern District of Pennsylvania affirmed the order of Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware confirming Owens Corning's Sixth Amended Plan of Reorganization. The Plan took effect on October 31, 2006, marking the company's emergence from Chapter 11. Reorganized Owens sought on July 25, 2008, from the Delaware Bankruptcy Court a final decree closing the Chapter 11 cases of 17 of its affiliates. Only the Chapter 11 case of Owens Corning Sales, LLC, formerly known as Owens Corning, under Case No. 00-03837 will remain open. (Owens Corning Bankruptcy News; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) * * * Reorganized Owens Corning carries a 'Ba1' corporate family rating from Moody OXIGENE INC: Capital Ventures Discloses 6.4% Equity Stake --------------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on January 28, 2011, each of Capital Ventures International and Heights Capital Management, Inc., disclosed beneficial ownership of 8,253,077 shares of common stock of OXiGENE Inc., representing 6.4% of the shares outstanding. The Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2010 stated there were 107,892,343 Shares outstanding as of November 5, 2010 and the Company's Current Report on Form 8-K dated January 18, 2011 stated that an additional 21,938,673 Shares were issuable on or about January 21, 2011. About OXiGENE Inc. South San Francisco, Calif.-based OXiGENE (Nasdaq: OXGN) -- http://www.oxigene.com/-- is a clinical-stage biopharmaceutical company developing novel therapeutics to treat cancer and eye diseases. The Company's balance sheet at September 30, 2010, showed $7.7 million in total assets, $15.2 million in total liabilities, and a stockholders' deficit of $7.5 million. As reported in the Troubled Company Reporter on March 22, 2010, Ernst & Young LLP, in Boston, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has incurred recurring operating losses and will be required to raise additional capital, alternative means of financial support, or both, prior to January 1, 2011, in order to sustain operations. OXIGENE INC: Fails to Meet $50MM Market Value NASDAQ Requirement ---------------------------------------------------------------- On January 19, 2011, OXiGENE, Inc. received, as expected, a letter from The NASDAQ Stock Market notifying the Company that it had not regained compliance with the minimum $50 million market value of listed securities requirement of The NASDAQ Global Market set forth in Listing Rule 5450(b)(2)(A). As previously reported, on July 21, 2010, the NASDAQ Staff notified the Company that it had failed to meet the NASDAQ MVLS requirement and, in accordance with NASDAQ's Listing Rules, would be provided until January 18, 2011, to regain compliance. The Company did not regain compliance within this time. The Company recently appeared before a NASDAQ Listing Qualifications Panel and presented its plan to regain compliance with respect to both the applicable MVLS and bid price requirements. As previously reported, on December 15, 2010, the NASDAQ Staff notified the Company that it did not comply with the minimum $1.00 bid price requirement set forth in Listing Rule 5450(a)(1) and that the Company's common stock was subject to delisting unless it requested a hearing before the Panel. The Company understands that appearing before a Panel automatically stays the delisting until the Panel issues its decision, usually within three to six weeks following the hearing. However, there can be no assurance that the Panel will grant the Company's request for continued listing on The NASDAQ Stock Market or that the Company will regain compliance. About OXiGENE Inc. South San Francisco, Calif.-based OXiGENE (Nasdaq: OXGN) -- http://www.oxigene.com/-- is a clinical-stage biopharmaceutical company developing novel therapeutics to treat cancer and eye diseases. The Company's balance sheet at September 30, 2010, showed $7.7 million in total assets, $15.2 million in total liabilities, and a stockholders' deficit of $7.5 million. As reported in the Troubled Company Reporter on March 22, 2010, Ernst & Young LLP, in Boston, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has incurred recurring operating losses and will be required to raise additional capital, alternative means of financial support, or both, prior to January 1, 2011, in order to sustain operations. PARAMOUNT RESOURCES: Moody's Assigns 'Caa1' to C$70MM Unsec Notes ----------------------------------------------------------------- Moody's Investors Service assigned a Caa1 rating to Paramount Resources Ltd.'s proposed offering of C$70 million of senior unsecured notes and upgraded the rating on its existing senior unsecured notes to Caa1 from Caa2. Moody's also affirmed the company's B3 Corporate Family Rating. The proceeds of the new notes issue will be used for capital expenditures and general corporate purposes. The upgrade in the senior unsecured rating reflects the replacement of anticipated secured debt with $70 million of unsecured debt. The lower amount of prior ranking secured debt in the capital structure than previously anticipated results in a rating of the unsecured notes only one notch below the B3 CFR. The rating outlook remains negative. Paramount's B3 CFR is supported by its substantial alternate liquidity and historically low leverage, which has weakened substantially with its two recent notes issuances, but is expected to improve over the next 18 months as new production comes on- stream and reserves are added. The rating also considers the more than 50 percent management ownership of Paramount. The rating is constrained by the company's poor operating track record, small production and reserves base, and high full-cycle costs that have limited organic reserves replacement. The negative outlook reflects a significant increase in Paramount's near term leverage and the considerable execution risk surrounding the plan to rapidly grow upstream natural gas production in 2011 and 2012 in tandem with the expansion of midstream gas processing capacity. The production growth will materialize over time and only after significant incremental debt has been incurred, leaving leverage elevated in the near term. Furthermore, the company is ramping up production at a time when natural gas prices are expected to remain under pressure due to soft demand and continued rapid growth in shale gas production in North America. Paramount plans to spend over $100 million in building midstream facilities and considerably more in drilling, completion and tie- in costs in pursuit of almost tripling its upstream production over the next two years. In recent years, the company has been unable to show organic growth, and has not proven to be a cost effective operator of E&P assets. Due to heavy upfront capital expenditures, Paramount will also experience steady erosion in liquidity until early 2012, when production reaches a higher plateau and elevated capital spending needs dissipate. However, the company will have the flexibility to pare back spending in the event of protracted weak natural gas prices, as both midstream and upstream development is expected to occur in modular fashion. In the past, the company has also shown the willingness to monetize its equity holdings to improve liquidity and repay debt. Pro forma for the $70 million of new notes, the C$300 million of notes and C$60 million of equity issue in November 2010, and anticipated debt repayments, we estimate that Paramount had approximately C$226 million of cash and C$143 million of available borrowing capacity under its C$160 million borrowing base revolving credit facility at September 30, 2010. There is a high likelihood that the company will have used up most of this liquidity by the end of 2011. The company would then need additional external financing to fund a portion of its growth capex. To meet this liquidity need, Moody's would expect Paramount to expand its reserves-based borrowing base revolver following the addition of significant amounts of proved developed producing reserves. Moody's notes that Paramount has substantial alternate liquidity through the value in its equity investments. The combined market value of Paramount's quoted investment portfolio was approximately C$444 million at Sept 30, 2010. Paramount's bank lenders have a first charge over the producing assets of Paramount, but not the equity investments. The investment portfolio represents an important pool of liquidity to Paramount. The rating could be downgraded to Caa1 if Paramount is unable to attain production growth within the anticipated capex and timeline causing leverage to remain elevated over a longer period, or if the company runs into liquidity problems. The outlook would return to stable if the company can lower leverage as measured by debt to production below US$20,000 per boe on a sustainable basis while bringing production and capital expenditures to a more steady state. The principal methodologies used in this rating were Independent Exploration and Production Industry published in December 2008, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Paramount Resources Ltd. is a Calgary, Alberta based predominantly natural gas producing E&P company with principal properties in Alberta, the Northwest Territories, British Columbia, Montana, and North Dakota. PARTSEARCH TECHNOLOGIES: Files Chapter 11 After Losing Best Buy --------------------------------------------------------------- Partsearch Technologies Inc. filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 11-10282) on Jan. 27 in Manhattan after discovering it overcharged its largest customer Best Buy Co. Inc. by $5.9 million, Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported. According to the report, the petition was accompanied by a motion to sell the business for $2.875 million to Eldis Inc. Partsearch, based in Kingston, New York, offers parts for consumer electronics and outdoor power equipment. It doesn't hold inventory of its own. Inventory comes from suppliers. According to Mr. Rochelle's report, Partsearch discovered in September that it had overcharged Richfield, Minnesota-based Best Buy, its largest customer. In October, Best Buy stopped doing business and refused to pay outstanding payables. The following month, Partsearch determined that the business wasn't viable without Best Buy as a customer. The workers were all fired. Partsearch disclosed assets for $4 million and total liabilities of $13 million. On top of the $5.9 million owing to Best Buy, liabilities include $7 million in trade payables plus an undetermined amount for labor-law violations for firing workers without required notice. PARTSEARCH TECHNOLOGIES: Case Summary & Creditors List ------------------------------------------------------ Debtor: Partsearch Technologies, Inc. 708 Third Avenue, 5th Floor New York, NY 10017 Bankruptcy Case No.: 11-10282 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: William R. Baldiga, Esq. BROWN RUDNICK LLP 7 Times Square New York, NY 10036 Tel: (212)209-4800 Fax: (212)209-4801 E-mail: wbaldiga@brownrudnick.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 30 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nysb11-10282.pdf The petition was signed by Lawton W. Bloom, chief restructuring officer. PENINSULA GAMING: S&P Holds 'B+' Corp. Credit Rating; Outlook Neg. ------------------------------------------------------------------ Standard & Poor's Ratings Services removed its ratings on Dubuque, Iowa-based gaming operator Peninsula Gaming LLC, from CreditWatch, where they were placed with negative implications on Dec. 16, 2010. S&P affirmed its 'B+' corporate credit rating on the Company and assigned a negative rating outlook. At the same time, S&P affirmed S&P's issue-level rating on Peninsula's 8.375% senior secured notes due 2015 (rated 'BB' with a recovery rating of '1') incorporating the anticipated $80 million add-on, which would bring the total size of the issue to $320 million. S&P also affirmed its issue-level rating on Peninsula's 10.75% senior unsecured notes due 2017 (rated 'B' with a recovery rating of '5') incorporating the proposed $50 million add-on, which would bring the total size of the issue to $355 million. In the preliminary offering memorandum for the add-on to Peninsula's 10.75% senior unsecured notes, the Company states that it is seeking consents from holders of its 8.375% senior secured notes to permit the issuance of an additional $80 million of the senior secured notes. S&P's rating incorporates the expectation that Peninsula will receive the consents necessary to issue the additional senior secured notes. Proceeds from the additional senior secured and senior unsecured notes, along with a proposed furniture, fixtures, and equipment (FF&E) facility, proposed vendor financing, and internally generated cash, will be used to fund the construction and development of a new casino near Wichita, Kansas. "The affirmation of the 'B+' corporate credit rating reflects our expectation that, while credit measures will weaken meaningfully during the initial development phase of the Company's casino project in Kansas, the new property will ramp up quickly and credit measures will improve to levels more in line with the current rating (adjusted leverage below 6.0x and coverage above 1.5x) by the end of 2012," said Standard & Poor's credit analyst Ariel Silverberg. S&P expects credit measures will begin to weaken in the first quarter of 2011 in conjunction with the additional notes issuance and commencement of construction, with adjusted leverage reaching the high 7.0x area and interest coverage will falling slightly below 1.5x by the end of 2011. Given S&P's expectation for EBITDA generation from the Kansas property (beginning in the first quarter of 2012), in conjunction with S&P's expectation for flat to low single digit percent EBITDA growth at Peninsula's existing four properties, S&P believes internally generated operating cash flow beginning in 2012 will be sufficient to fund most development and maintenance capital expenditures through the remaining construction phases of the project. PENN TREATY AMERICAN: Deltec Asset Discloses 8.7% Equity Stake -------------------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on January 25, 2011, Deltec Asset Management, LLC disclosed that it beneficially owns 2,017,675 shares of common stock of Penn Treaty American Corporation representing 8.7% of the shares outstanding. About Penn Treaty American Penn Treaty American Corporation -- https://www.penntreaty.com/ -- through its wholly owned direct and indirect subsidiaries, Penn Treaty Network America Insurance Company, American Network Insurance Company, American Independent Network Insurance Company of New York, Network Insurance Senior Health Division and Senior Financial Consultants Company, is engaged in the underwriting, marketing and sale of individual and group accident and health insurance products, principally covering long term nursing home and home health care. On October 2, 2009, the Insurance Commissioner of the Commonwealth of Pennsylvania filed in the Commonwealth Court of Pennsylvania Petitions for Liquidation for PTNA and American Network Insurance Company. PTNA is a direct insurance company subsidiary of Penn Treaty American Corporation, and ANIC is a subsidiary of PTNA. PLATINUM STUDIOS: CEO Rosenberg Gives 30-Day Loan of $100,000 ------------------------------------------------------------- On January 27, 2011, Platinum Studios, Inc., entered into a loan agreement with its CEO, Scott M. Rosenberg. Pursuant to the terms of the Agreement, Mr. Rosenberg has agreed to loan $100,000 to the Company for a period of 30 days. The loan bears no interest. About Platinum Studios Los Angeles, Calif.-based Platinum Studios, Inc., controls a library consisting of more than 5,000 characters and is engaged principally as a comics-based entertainment company adapting characters and storylines for production in film, television, publishing and all other media. The Company's balance sheet as of September 30, 2010, showed $15.90 million in total assets, $24.48 million in total liabilities, and a stockholders' deficit of $8.58 million. Accumulated deficit was $25.80 million at Sept. 30, 2010. HJ Associates & Consultants, LLP, in Salt Lake City, Utah, expressed substantial doubt about Platinum Studios, Inc.'s ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations which have resulted in an accumulated deficit. PLY GEM HOLDINGS: Inks $175MM Secured ABL Facility With UBS ----------------------------------------------------------- On January 26, 2011, Ply Gem Holdings, Inc., Ply Gem Industries, Inc., a wholly-owned subsidiary of the Company, each of the direct and indirect domestic subsidiaries of Ply Gem Industries, and Ply Gem Canada, Inc., Ply Gem Industries' Canadian subsidiary, entered into a senior secured asset-based revolving credit agreement with UBS Securities LLC, as joint lead arranger and joint bookrunner, Wells Fargo Capital Finance, LLC, as syndication agent, joint lead arranger, joint bookrunner and co-collateral agent, UBS AG, Stamford Branch, as U.S. administrative agent and U.S. collateral agent, UBS AG Canada Branch, as Canadian administrative agent and Canadian collateral agent, and a syndicate of financial institutions and institutional lenders. Structure The ABL Facility provides for revolving credit financing of up to $175.0 million subject to borrowing base availability, with a maturity of five years, including sub-facilities for letters of credit, swingline loans and borrowings in Canadian dollars and United States dollars by Ply Gem Canada. $160.0 million of the ABL Facility is available to Ply Gem Industries and $15.0 million is available to Ply Gem Canada. In addition, the ABL Facility provides that the revolving commitments may be increased to $250.0 million, subject to certain terms and conditions. The borrowing base at any time equals the sum of: * 85% of the net amount of eligible receivables; and * 85% of the net orderly liquidation value of eligible inventory All borrowings under the ABL Facility will be subject to the satisfaction of customary conditions, including absence of a default and accuracy of representations and warranties. Interest and Fees Borrowings under the ABL Facility bear interest at a rate per annum equal to, at Ply Gem Industries' option, either (a) a base rate determined by reference to the higher of (1) the corporate base rate of the Administrative Agent, as established at its Stamford Branch, and (2) the federal funds effective rate plus 0.5% or (b) a Eurodollar rate determined by reference to the costs of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs, in each case plus an applicable margin. The initial applicable margin for borrowings under the ABL Facility is 1.50% for base rate loans and 2.50% for Eurodollar rate loans. The applicable margin for borrowings under the ABL Facility will be subject to step ups and step downs based on average excess availability under that facility. Swingline loans will bear interest at a rate per annum equal to the base rate plus the applicable margin. In addition to paying interest on outstanding principal under the ABL Facility, Ply Gem Industries is required to pay a commitment fee, in respect of the unutilized commitments thereunder, which fee will be determined based on utilization of the ABL Facility. Ply Gem Industries must also pay customary letter of credit fees equal to the applicable margin on Eurodollar loans and agency fees. Term The ABL Facility has an initial term of five years. However, the ABL Facility will mature on (i) the date which is two months prior to the maturity date of Ply Gem Industries' existing 11.75% Senior Secured Notes due 2013 unless, on or prior to that date, the Senior Secured Notes have been repaid, refinanced or the maturity date thereof extended, in each case, to a date that is at least six months later than the Stated Maturity Date and (ii) the date which is three months prior to the maturity date of Ply Gem Industries' existing 13.125% Senior Subordinated Notes due 2014 unless, on or prior to that date, the Senior Subordinated Notes have been repaid, refinanced or the maturity date thereof extended, in each case, to a date that is at least six months later than the Stated Maturity Date. Mandatory prepayments If at any time the aggregate amount of outstanding loans, unreimbursed letter of credit drawings and undrawn letters of credit under the ABL Facility exceeds the lesser of (i) the commitment amount and (ii) the borrowing base, Ply Gem Industries will be required to repay outstanding loans and cash collateralize letters of credit in an aggregate amount equal to such excess, with no reduction of the commitment amount. If the amount available under the ABL Facility is less than the greater of (a) 15% of the lower of the revolving credit commitments and the borrowing base and (b) $20.0 million or certain events of default have occurred, all cash from Ply Gem Industries material deposit accounts will be swept daily into a collection account controlled by the administrative agent under the ABL Facility and used to repay outstanding loans and cash collateralize letters of credit. Optional prepayment Ply Gem Industries may voluntarily reduce the unutilized portion of the commitment amount and repay outstanding loans at any time without premium or penalty other than customary "breakage" costs with respect to Eurodollar loans. Amortization and final maturity There is no scheduled amortization under the ABL Facility. All outstanding loans under the facility are due and payable in full on the Stated Maturity Date. Security and Guarantees All obligations under the ABL Facility are unconditionally guaranteed by the Company and substantially all of Ply Gem Industries' existing and future, direct and indirect, wholly-owned domestic subsidiaries, and in any event by all subsidiaries that guarantee the Senior Secured Notes. All obligations under the ABL Facility, and the guarantees of those obligations, are secured, subject to certain exceptions, by substantially all of the assets of Ply Gem Industries and the Guarantors, including: -- a first-priority security interest in personal property consisting of accounts receivable, inventory, cash, deposit accounts, and certain related assets and proceeds of the foregoing; and -- a second-priority security interest in, and mortgages on, substantially all of Ply Gem Industries' material owned real property and equipment and all assets that secure the Senior Secured Notes on a first-priority basis. The obligations of Ply Gem Canada are secured by a first-priority security interest in substantially all of the assets of Ply Gem Canada and by Ply Gem Industries' and the Guarantors' assets on the same basis as borrowings by Ply Gem Industries are secured under the ABL Facility, plus additional mortgages in Canada, and a pledge by Ply Gem Industries of the remaining 35% of the equity interests of Ply Gem Canada pledged only to secure the Canadian sub-facility. Covenants The ABL Facility requires that if excess availability is less than the greater of (a) 12.5% of the lower of the revolving credit commitments and the borrowing base and (b) $17.5 million, Ply Gem Industries must comply with a minimum fixed charge coverage ratio test. In addition, the ABL Facility includes covenants that, subject to significant exceptions, limit Ply Gem Industries' ability and the ability of the Company and Ply Gem Industries' subsidiaries to, among other things, incur debt, incur liens and engage in sale leaseback transactions, make investments and loans, pay dividends, engage in mergers, acquisitions and asset sales, prepay certain indebtedness, amend the terms of certain material agreements, enter into agreements limiting subsidiary distributions, engage in certain transactions with affiliates and alter the business that Ply Gem Industries' conducts. Events of Default The ABL Facility contains events of default customary for financings of this type, including, but not limited to, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to certain indebtedness, certain events of bankruptcy, certain events under ERISA, material judgments, actual or asserted failure of any guaranty or security document supporting the ABL Facility to be in full force and effect and changes of control. If such an event of default occurs, the lenders under the ABL Facility would be entitled to take various actions, including the acceleration of amounts due under the ABL Facility and, subject to the Intercreditor Agreement, all actions permitted to be taken by a secured creditor. Certain of the agents and lenders or their affiliates have provided investment banking and other financial services to the Company and its affiliates from time to time, for which they received customary fees and commissions, and may also provide these services to the Company or its affiliates from time to time in the future. On January 26, 2011, Ply Gem Industries and Ply Gem Canada used the initial borrowing of $55.0 million under the ABL Facility to repay all of the outstanding indebtedness under the Credit Agreement, dated June 9, 2008, as amended and restated as of July 17, 2009, among the Company, Ply Gem Industries, Ply Gem Canada, the subsidiary guarantors party thereto, the lenders party thereto, Credit Suisse Securities (USA) LLC, as sole lead arranger and sole bookrunner, Credit Suisse, as administrative agent, and General Electric Capital Corporation, as collateral agent. The Existing Credit Facility was terminated upon the repayment of the outstanding indebtedness. About Ply Gem Based in Cary, North Carolina, Ply Gem Holdings Inc. is a diversified manufacturer of residential and commercial building products, which are sold primarily in the United States and Canada, and include a wide variety of products for the residential and commercial construction, the do-it-yourself and the professional remodeling and renovation markets. The Company's balance sheet at Oct. 2, 2010, showed $978.60 million in total assets, $167.11 million in total current liabilities, $1.99 million in deferred income taxes, $59.66 million in other long-term liabilities, $903.35 million in long-term debt, and a stockholders' deficit of $153.52 million. In May 2010, Standard & Poor's Ratings Services raised its (unsolicited) corporate credit rating on Ply Gem to 'B-' from 'CCC+'. "The ratings upgrade reflects our expectation that the company's credit measures are likely to improve modestly over the next several quarters to levels that we would consider more in line with the 'B-' corporate credit rating," said Standard & Poor's credit analyst Tobias Crabtree. In January 2010, Moody's Investors Service upgraded Ply Gem's Corporate Family Rating to Caa1 from Caa2 and its Probability of Default Rating to Caa1 from Caa2 and affirmed the senior secured notes due 2013 at Caa1. The upgrade of Ply Gem's corporate family rating resulted from the recent announcement that CI Capital Partners LLC, Ply Gem's indirect principal shareholder, through a series of transactions is transferring $257.3 million of 9.0% senior subordinated notes due 2012 that it owns to Ply Gem for no consideration as a capital contribution. Moody's also noted Ply Gem is also refinancing the balance of the 9.0% senior subordinated notes due 2012 with new senior subordinated notes due 2014. PRECISION OPTICS: Maturity of $600,000 Notes Extended to Feb. 7 --------------------------------------------------------------- On June 25, 2008, Precision Optics Corporation, Inc. entered into a Purchase Agreement, as amended on December 11, 2008, with certain accredited investors pursuant to which the company sold an aggregate of $600,000 of 10% Senior Secured Convertible Notes. The Investors amended the Notes on several dates to extend the "Stated Maturity Date" of the Notes. On January 24, 2011, the Investors further amended the Notes to extend the "Stated Maturity Date" to February 7, 2011. The Company believes the Investors will continue to work with it to reach a positive outcome on the Note repayment. About Precision Optics Gardner, Mass.-based Precision Optics Corporation, Inc. (OTC BB: PEYE) -- http://www.poci.com/-- designs, develops, manufactures and sells specialized optical systems and components and optical thin-film coatings. The Company conducts business in one industry segment only and its customers are primarily domestic. The Company's products and services fall into two principal areas: (i) medical products for use by hospitals and physicians; and (ii) advanced optical system design and development services and products used by industrial customers. 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. PRIMUS TELECOMMS: S&P Holds B- Corp. Credit Rating; Outlook Stable ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its ratings on Primus Telecommunications Group Inc., including the 'B-' corporate credit rating, and removed them from CreditWatch, where they were placed with negative implications on Oct. 5, 2010. The outlook is stable. The ratings affirmation on telecommunications provider Primus reflects clarification of matters related to the termination of both the CEO and CFO in October 2010. At that time, S&P placed the ratings on CreditWatch because S&P did not have sufficient information at the time to evaluate what impact, if any, the departure of these two key individuals might have on the Company's operational strategy or financial policies. Subsequent to the CreditWatch placement, S&P has had discussions with current management and based on those discussions, it is S&P's view that the management changes are not likely to materially affect the Company's overall business or financial risk profiles. S&P also indicated that in resolving the CreditWatch, S&P would also examine the potential effect on the rating of the pending acquisition of Arbinet Corp. It is S&P's view that the Arbinet transaction is not material to the rating as there is no increase in debt from this all-stock acquisition and, while Arbinet has the potential to bring a measure of operating synergies to Primus' wholesale sector, the cash flow effects would be limited, at best. Primus is a facilities-based, global provider of diversified communications services, including voice, broadband services, collocation, and hosting and outsourced managed services. The Company reported approximately $245 million of outstanding debt on Sept. 30, 2010. "Our ratings on Primus reflect the Company's vulnerable business risk profile inherent in its core competitive local exchange (CLEC) business model,' explained Standard & Poor's credit analyst Richard Siderman. "The ratings also take into account significant refinancing risk and exposure to currency fluctuations." Primus operates in highly competitive markets in its CLEC business, which provides the bulk of consolidated cash flow. The Company competes against larger and financially stronger incumbent telecom providers such as Bell Canada and Telus in Canada as well as Telstra and Optus in Australia. In addition, Primus' distance and transport services are commodity-like products and the Company continues to experience weakening demand for some of its legacy products. Q2 PROPERTIES: Case Summary & Largest Unsecured Creditor -------------------------------------------------------- Debtor: Q2 Properties, LLC 7610 NE 4 Court Miami, FL 33138 Bankruptcy Case No.: 11-12129 Chapter 11 Petition Date: January 27, 2011 Court: U.S. Bankruptcy Court Southern District of Florida (Miami) Judge: Robert A. Mark Debtor's Counsel: Scott Alan Orth, Esq. LAW OFFICES OF SCOTT ALAN ORTH, P.A. 3880 Sheridan Street Hollywood, FL 33021 Tel: (305) 757-3300 Fax: (305) 757-0071 E-mail: orthlaw@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Ofer Mizrahi, managing member. The list of unsecured creditors filed together with its petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Regions Bank -- $1,017,544 6990 SW 8 Street, Suite 200 Miami, FL 33144 QUANTUM CORP: Reports $5.86-Mil. Net Income in Dec. 31 Quarter -------------------------------------------------------------- Quantum Corp. filed its third quarter and year-end results with the Securities and Exchange Commission on January 26, 2011. The Company reported net income of $5.86 million on $176.22 million of revenue for the three months ended December 31, 2010, compared with net income of $4.63 million on $181.71 million of revenue for the same period a year ago. The Company also reported net income of $6.19 million on $507.17 million of revenue for the nine months ended December 31, 2010, compared with net income of $20.99 million on $516.97 million of revenue for the same period during the prior year. As of December 31, 2010, the Company's balance sheet showed $466.35 million in total assets, $531.54 million in total liabilities and a $65.19 million stockholders' deficit. "Although we were driving to a higher overall revenue target for the quarter, we made progress on a number of initiatives designed to increase channel traction and grow our branded business that demonstrate we are on the right track," said Rick Belluzzo, chairman and CEO of Quantum. "We grew branded revenue year-over- year for the fifth consecutive quarter. We had record branded disk systems and software sales, with our midrange DXi(R) product revenue nearly tripling year-over-year and more than doubling sequentially. We generated our highest level of StorNext(R) quarterly revenue to date, with a record 22 percent of sales from new customers. And we further extended our tape leadership, adding 170 new enterprise and midrange automation customers. "When you combine this momentum with the enhancements we continue to make across our product portfolio, most notably the new DXi 2.0 software platform we are also announcing today, we are well- positioned to deliver revenue growth and increased profits as the storage market continues to evolve," Belluzzo added. Quantum ended FQ3'11 with $93 million in total cash and cash equivalents and $280 million in total debt. The company generated $18 million in cash from operations and refinanced its subordinated term debt with subordinated convertible debt at a significantly lower interest rate expected to save Quantum approximately $10 million annually in interest expense. In addition, Moody's Investor Service recently upgraded Quantum's credit rating. A full-text copy of the Company's press release announcing the Quarter and Annual Results is available for free at: http://ResearchArchives.com/t/s?729a About Quantum Corp. Based in San Jose, California, Quantum Corp. (NYSE:QTM) -- http://www.quantum.com/-- is a storage company specializing in backup, recovery and archive. Quantum provides a comprehensive, integrated range of disk, tape, and software solutions supported by a world-class sales and service organization. The Company's balance sheet at Sept. 30, 2010, showed $459.56 million in total assets, $192.65 million in total current liabilities, $350.59 million in total long-term liabilities, and a stockholders' deficit of $83.68 million. In January 2011, Moody's Investors Service upgraded Quantum Corporation's Corporate Family and Probability of Default ratings to B2 from B3 and revised the ratings on the senior secured debt obligations to Ba3 from B1. The rating outlook is positive. The upgrade of the CFR to B2 reflects Quantum's improved operating performance, which stems from strong customer adoption and growth of its higher margin branded disk-based systems and software products, which Moody's expects to continue in FY12. RADIENT PHARMACEUTICALS: Securities Subject to NYSE Delisting ------------------------------------------------------------- Radient Pharmaceuticals Corporation announced that it received a notice dated January 25, 2010 from the NYSE Amex advising that as of January 25, 2011, it remains non-compliant with Section 1003(a)(iv), and Sections 1003(a)(i), 1003(a)(ii), 1003(a)(iii) and 704 of the Exchange's continued listing standards. Therefore, RPC's securities are subject to delisting from the Exchange. Based on recent operational progress, RPC intends to appeal the delisting determination and is seeking an oral hearing before the Exchange's Listing Qualifications Panel to make that appeal. Pursuant to the Exchange's Company Guide, that hearing should occur within 45 days of the date the Company's request for that hearing is filed, which will be on or before February 1, 2011. The request for appeal is expected to stay any action with respect to the Amex's Determination to prohibit the continued listing of RPC's securities and allow the continued listing of RPC's common stock on NYSE Amex until the Amex decides the suspension of trading is in the public's best interest or after the hearing when the Panel renders its decision. At the hearing, RPC intends to provide additional details on the original plan RPC submitted to the Exchange on January 22, 2010 to gain compliance. The Company will also present its latest operational progress report, the milestones achieved, and request the Panel allow RPC additional time within which to regain compliance and maintain a listing on the Exchange. There can be no assurance that the Panel will grant the Company's request for continued listing on the NYSE Amex. Radient Pharmaceuticals will continue its normal course of business operations notwithstanding the status of the Amex listing. As referenced in its January 10, 2011 press release related to the AMEX approval of various debt for equity exchanges, the Company currently has converted or exchanged approximately $16.6 million in debt, interest, and penalties, and anticipates converting or exchanging approximately an additional $8 million in debt during the first quarter of 2011. After these conversions and exchanges, the Company will have approximately $21 million in shareholder's equity. It should also be noted that, as of January 26, 2011, RPC has approximately 88 million shares outstanding, and the Company is hopeful it can complete additional financings in the first quarter 2011. RPC believes the debt for equity exchanges, progress towards meeting milestones, combined with the anticipated financing will enable RPC to regain compliance with AMEX listing requirements. About Radient Pharmaceuticals Headquartered in Tustin, Calif., Radient Pharmaceuticals Corporation -- http://www.Radient-Pharma.com/-- is engaged in the research, development, manufacturing, sale and marketing of its ONKO-SURE(TM) a proprietary IVD Cancer Test in the United States, Canada, China, Chile, Europe, India, Korea, Taiwan, Vietnam and other markets throughout the world. Radient said in October 2010 it incurred a trigger event on the 12% Convertible Notes issued in first and second quarter of 2010 due to its failure to have the related registration statement declared effective by June 1, 2010. The Company filed on Sept. 7, 2010, an Event of Default under those same notes occurred since it did not hold the related shareholder meeting by August 31, 2010. As reported in the Troubled Company Reporter on April 19, 2010, KMJ Corbin & Company LLP, in Costa Mesa, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company incurred a significant operating loss and negative cash flows from operations in 2009 and had a working capital deficit of $4.2 million at December 31, 2009. The Company's balance sheet at Sept. 30, 2010, showed $23.56 million in total assets, $34.22 million in total liabilities, and a stockholders' deficit of $10.66 million. RASE TECHNOLOGIES: Linden Capital Discloses 2.47% Equity Stake -------------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on January 26, 2011, each of Linden Capital LP, Linden GP LLC and Siu Min Wong disclosed beneficial ownership of 2,637,840 shares of common stock of Raser Technologies, Inc. representing 2.47% of the shares outstanding. The number of shares outstanding of the Company's common stock as of November 9, 2010 was 105,497,009 shares. About Raser Technologies Provo, Utah-based Raser Technologies, Inc. (NYSE: RZ) -- http://www.rasertech.com/-- is an environmental energy technology company focused on geothermal power development and technology licensing. Raser's Power Systems segment develops clean, renewable geothermal electric power plants with one operating plant in southern Utah and eight active and early stage projects in four western United States: Utah, New Mexico, Nevada and Oregon, as well as a concession for 100,000 acres in Indonesia. Raser's Transportation and Industrial segment focuses on extended-range plug-in-hybrid vehicle solutions and using Raser's award-winning Symetron(TM) technology to improve the torque density and efficiency of the electric motors and drive systems used in electric and hybrid-electric vehicle powertrains and industrial applications. * * * Hein & Associates LLP, in Denver, Colo., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses, has used significant cash for operating activities since inception, has significant purchase commitments in 2010 and has a lack of sufficient working capital. Raser Technologies did not make the $2.2 million semi-annual interest payment due October 1, 2010, on its 8% Convertible Senior Notes Due 2013. The Company satisfied the semi-annual interest payment obligation after receiving $1.10 million from the Thermo No. 1 plant escrow funds and $1.15 million from a loan with Evergreen Clean Energy, LLC, late in October 2010. REALOGY CORP: Amends Credit Agreement With Domus, et al. -------------------------------------------------------- On January 25, 2011, Realogy Corporation received the requisite consents and on January 26, 2011 entered into a first amendment to its Credit Agreement, dated as of April 10, 2007, among Domus Intermediate Holdings Corp., the Company, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other agents from time to time party thereto. The First Amendment and an incremental assumption agreement related thereto, to be entered into upon the effectiveness of the First Amendment, among other things: * extend the maturity of certain of its first lien term loans held by accepting lenders to October 10, 2016 and increase the interest rate with respect to the Extended Term B Loans by 1.25%; * extend the maturity of all or a portion of the loans and commitments under its revolving credit facility held by accepting lenders to April 10, 2016, increase the interest rate with respect to the Extended Revolving Loans by 1.00%, and convert 16.67% of the Extended Revolving Loans of certain affiliates of the initial purchasers, and 27.5% of the Extended Revolving Loans of all other lenders, to Extended Term B Loans; * extend the maturity of all or a portion of the commitments under its synthetic letter of credit facility held by accepting lenders to October 10, 2016 and increase the rate for participation fees payable with respect to the Extended Synthetic LC Commitments by 1.25%; * allow for the issuance of $700 million aggregate principal amount of senior secured debt financing secured by a lien expressly junior in priority to all senior priority liens, including those that secure the Company's first lien obligations under its senior secured credit facility, the gross proceeds of which will be applied toward the prepayment of the outstanding Extended Term B Loans; * allow for one or more future issuances of additional senior secured or unsecured notes or loans to prepay the Company's first lien term loans, to be secured on either a pari passu basis with, or junior to, its first lien obligations under the senior secured credit facility; * allow for one or more future issuances of additional senior secured or unsecured notes or loans to prepay the Company's second lien loans, to be secured on a pari passu basis with, or junior to, its second lien loans under the senior secured credit facility; * allow for the incurrence of additional incremental term loans that are secured on a junior basis to the second lien loans in an aggregate amount not to exceed $350 million; and * provide that the $700 million senior secured debt financing and any future indebtedness secured by a lien that is junior in priority to the first lien obligations under the senior secured credit facility will not, subject to certain exceptions, constitute senior secured debt for purposes of calculating the senior secured leverage ratio under the senior secured credit facility. The Extended Term B Loans do not require any scheduled amortization of principal. The term loan facility will continue to provide for quarterly amortization payments totaling 1% per annum of the principal amount of the non-extended first lien term loans. The interest rate with respect to the Extended Term B Loans will be based on, at the Company's option, (a) adjusted LIBOR plus 4.25% or (b) the higher of the Federal Funds Effective Rate plus 0.5% and JPMorgan Chase Bank, N.A.'s prime rate plus 3.25%. The interest rate with respect to the Extended Revolving Loans will be based on, at the Company's option, (a) adjusted LIBOR plus 3.25% or (b) ABR plus 2.25%. The mandatory prepayment obligations under the Company's term loan facility include: * 100% of the net cash proceeds of asset sales and dispositions in excess of certain specified amounts, subject to certain exceptions and customary reinvestment provisions; provided that, if the senior secured leverage ratio is less than or equal to 2.5:1.0, the Company may retain up to $200 million of asset sale proceeds; * if the Company's senior secured leverage ratio exceeds 3.25:1.0, 50% of its excess cash flow (reducing to 25% if the senior secured leverage ratio is greater than 2.5:1.0 but less than or equal to 3.25:1.0 and to 0% if the senior secured leverage ratio is less than or equal to 2.5:1.0); and * if the Company's senior secured leverage ratio exceeds 2.5:1.0, 100% of the net cash proceeds received from issuances of debt, subject to certain exclusions including certain debt permitted to be incurred under the senior secured credit facility. Pursuant to the terms of the First Amendment, the calculation of the senior secured leverage ratio for each of the foregoing prepayment obligations will include the $700 million senior secured debt financing and any future indebtedness secured by a lien that is pari passu in priority to the lien securing such senior secured debt financing. In addition, lenders under the Company's senior secured credit facilities have agreed to extend the maturity of approximately $2,421 million aggregate principal amount of their Extended Term B Loans, approximately $461 million aggregate principal amount of their Extended Revolving Loans and approximately $173 million aggregate principal amount of their Extended Synthetic LC Commitments, and to convert approximately $98 million aggregate principal amount of their Extended Revolving Loans to Extended Term B Loans. The total amount of commitments in respect of non- extended and Extended Revolving Loans will be approximately $652 million. $638 million of first lien term loans were not extended into Extended Term B Loans. Lenders holding approximately $103 million of Extended Term B Loans elected not to receive a portion of the $700 million prepayment. Lenders holding the remaining $2,318 million of Extended Term B Loans will receive the $700 million prepayment on a pro rata basis, which represents a total paydown of approximately 30% of the Extended B Term Loans that elected to receive a portion of the prepayment. The effectiveness of the First Amendment is subject to the prepayment of $700 million of Extended Term B Loans and the satisfaction of certain other customary conditions. Both the First Amendment and the extensions are subject to the closing of the $700 million senior secured debt financing. About Realogy Corp. Realogy Corporation -- http://www.realogy.com/-- a global provider of real estate and relocation services with a diversified business model that includes real estate franchising, brokerage, relocation and title services. Realogy's world-renowned brands and business units include Better Homes and Gardens Real Estate, CENTURY 21, Coldwell Banker, Coldwell Banker Commercial, The Corcoran Group, ERA, Sotheby's International Realty, NRT LLC, Cartus and Title Resource Group. Collectively, Realogy's franchise systems have around 15,000 offices and 270,000 sales associates doing business in 92 countries around the world. Headquartered in Parsippany, N.J., Realogy is owned by affiliates of Apollo Management, L.P., a leading private equity and capital markets investor. Realogy fully supports the principles of the Fair Housing Act. The Company's balance sheet at Sept. 30, 2010, showed $8.16 billion in total assets, $9.14 billion in total liabilities, and a deficit of $981.0 million. Realogy carries a 'CC' corporate credit rating with a "developing" outlook from Standard & Poor's. The rating remains on CreditWatch with positive implications. S&P said in January 2011 that the CreditWatch listing reflects S&P's expectation that Realogy's liquidity profile would be improved upon the closing of the proposed issuance of $700 million notes to prepay existing first- lien debt. Realogy has 'Caa2' corporate rating, with positive outlook, from Moody's. Moody's said in January 2011 that the Caa2 Corporate Family Rating and Caa3 Probability of Default Rating reflects very high leverage, negative free cash flow and uncertainty regarding the timing and strength of a recovery of the residential housing market in the US. REALOGY CORP: Announces Pricing of $700MM Sr. Secured Notes ----------------------------------------------------------- Realogy Corporation announced that it priced $700 million aggregate principal amount of 7.875% Senior Secured Notes due 2019 in connection with its previously announced private offering exempt from the registration requirements of the Securities Act of 1933, as amended. The closing of the private offering is expected to occur on February 3, 2011, subject to customary closing conditions. The Notes will be guaranteed on a senior secured basis by Domus Intermediate Holdings Corp., the Company's parent, and each domestic subsidiary of the Company that is a guarantor under its senior secured credit facility. The Notes will also be guaranteed by Domus Holdings Corp., the Company's indirect parent, on an unsecured senior subordinated basis. The Notes will be secured by substantially the same collateral as the Company's existing first lien obligations under its senior secured credit facility, but the priority of the collateral liens securing the Notes will be (i) junior to the collateral liens securing the Company's first lien obligations under its senior secured credit facility and (ii) senior to the collateral liens securing the Company's second lien obligations under its senior secured credit facility. The Notes will not be registered under the Securities Act or any state securities law and may not be offered or sold in the United States absent registration or an applicable exemption from registration under the Securities Act and applicable state securities laws. The Notes will be offered in the United States only to qualified institutional buyers under Rule 144A of the Securities Act and outside the United States under Regulation S of the Securities Act. The Company will use the net proceeds from the offering of the Notes, along with cash on hand, to prepay $700 million of certain of its first lien term loans that were extended in connection with an amendment to its senior secured credit facility. About Realogy Corp. Realogy Corporation -- http://www.realogy.com/-- a global provider of real estate and relocation services with a diversified business model that includes real estate franchising, brokerage, relocation and title services. Realogy's world-renowned brands and business units include Better Homes and Gardens Real Estate, CENTURY 21, Coldwell Banker, Coldwell Banker Commercial, The Corcoran Group, ERA, Sotheby's International Realty, NRT LLC, Cartus and Title Resource Group. Collectively, Realogy's franchise systems have around 15,000 offices and 270,000 sales associates doing business in 92 countries around the world. Headquartered in Parsippany, N.J., Realogy is owned by affiliates of Apollo Management, L.P., a leading private equity and capital markets investor. Realogy fully supports the principles of the Fair Housing Act. The Company's balance sheet at Sept. 30, 2010, showed $8.16 billion in total assets, $9.14 billion in total liabilities, and a deficit of $981.0 million. Realogy carries a 'CC' corporate credit rating with a "developing" outlook from Standard & Poor's. The rating remains on CreditWatch with positive implications. S&P said in January 2011 that the CreditWatch listing reflects S&P's expectation that Realogy's liquidity profile would be improved upon the closing of the proposed issuance of $700 million notes to prepay existing first- lien debt. Realogy has 'Caa2' corporate rating, with positive outlook, from Moody's. Moody's said in January 2011 that the Caa2 Corporate Family Rating and Caa3 Probability of Default Rating reflects very high leverage, negative free cash flow and uncertainty regarding the timing and strength of a recovery of the residential housing market in the US. REFCO INC: Court OKs Togut's Fees for February to October --------------------------------------------------------- Bankruptcy Judge Robert Drain approved the allowance of the fees and reimbursement of expenses for services rendered to Albert Togut, as Chapter 7 Trustee overseeing the liquidation of Refco LLC, for these three professionals for the fee period from Feb. 1, 2010 to Oct. 31, 2010: Professional Fees Expenses ------------ -------- -------- Togut, Segal & Segal LLP $136,180 $1,176 General Bankruptcy Counsel Bridge Associates LLC 391,378 54,881 Trustee's Financial Advisors Jenner & Block LLP 161,200 3,385 Refco Trustee's Attorney About Refco Inc. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- was a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries were members of principal U.S. and international exchanges, and were among the most active members of futures exchanges in Chicago, New York, London and Singapore. Refco was also a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco was one of the largest global clearing firms for derivatives. The Company had operations in Bermuda. The Company and 23 of its affiliates filed for Chapter 11 protection on October 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represented the Debtors in their restructuring efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its Chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on December 15, 2006. That Plan became effective on Dec. 26, 2006. Pursuant to the plan, RJM, LLC, was named plan administrator to reorganized Refco, Inc., and its affiliates, and Marc S. Kirschner as plan administrator to Refco Capital Markets, Ltd. Bankruptcy Creditors' Service, Inc., publishes Refco Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Refco Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) REFCO INC: Files Post-Confirmation Report for Q4 2010 ----------------------------------------------------- Refco, Inc., and its affiliates, including Refco Capital Markets, Ltd., delivered to the U.S. Bankruptcy Court for the Southern District of New York a copy of their post-confirmation quarterly report for the period from October 1 to December 31, 2010. Valerie E. DePiro, chief financial officer of Refco Inc. and Refco Capital Markets, Ltd., relates that a cash balance of $71,278,000 at the beginning of October 2010 decreased to $22,172 at the end of the reporting period. The Reorganized Debtors received $1,221,000 in total cash and disbursed $50,327,000 for the fourth quarter of 2010. Unaudited Schedule of Cash Receipts and Disbursements (in thousands) Beginning Inter- Ending Debtor Balance Receipts Company Disbursements Balance ----- ------- -------- ------- ------------- ------- Refco Capital Markets $21,255 $12 $35,000 ($49,332) $7,095 Refco Capital LLC 45,229 1,208 (35,400) (807) 10,230 Refco F/X Assoc. 4,906 1 - (68) 4,839 Refco Group Ltd. - - - - - Refco Regulated - - - - - Refco Inc. 28 - 100 (120) 8 Westminster-Refco - - - - - ------- -------- ------- ------------- ------- Totals $71,278 $1,221 $- ($50,327) $22,172 Schedule of Cash Distributions to Creditors (in thousands) Quarter Ended Emergence Dec. 31, 2010 to Date ------------- --------- Administrative and Operating Expenses $1,042 $100,548 TREATMENT OF CONTRIBUTING DEBTORS' CREDITORS AND INTEREST HOLDERS Priority Tax Claims - 1,613 Class 1 - Non Tax Priority Claims - - Class 2 - Other Secured Claims - - Class 3 - Secured Lender Claims - 703,967 Class 4 - Senior Subordinated Note Claims - 335,985 Class 5(a) - Contributing Debtors General Unsecured Claims 120 148,802 Class 5(b) - Related Claims - - Class 6 - RCM Intercompany Claims - - Class 7 - Subordinated Claims - - Class 8 - Old Equity Interests - - TREATMENT OF FXA CREDITORS Priority Tax Claims - 90 Class 1 - FXA Non-Tax Priority Claims - - Class 2 - FXA Other Secured Claims - - Class 3 - FXA Secured Lender Claims - - Class 4 - FXA Sr. Subordinated Note Claims - - Class 5(a) - FXA General Unsecured Claims 49 21,165 Class 5(b) - Related Claims - - Class 6 - FXA Convenience Claims - 4,827 Class 7 - FXA Subordinated Claims - - TREATMENT OF RCM CREDITORS Priority Tax Claims - - Class 1 - RCM Non-Tax Priority Claims - - Class 2 - RCM Other Secured Claims - - Class 3 - RCM FX/Unsecured Claims 29,201 479,168 Class 4 - RCM Securities Customer Claims 19,915 2,664,896 Class 5 - RCM Leuthold Metals Claims - 19,364 Class 6 - Related Claims - - Class 7 - RCM Subordinated Claims - - Ms. DePiro tells the Court that all employees were terminated by the Debtors on September 30, 2008. The Debtors continue to utilize former employees, from time to time, as contractors to assist with certain wind-down activities, including effectuating distributions to creditors. The Debtors compensate the former employees on an hourly basis. Ms. DePiro says that tax claims and notices were received by the Debtors from the Internal Revenue Service and state taxing authorities in the aggregate amount of approximately $20 million. All of the original 47 claims filed have been expunged or resolved. Allowed Claims total approximately $1.6 million and have been paid. All insurance policies are fully paid for the current period. A full-text copy of the Reorganized Debtors' Post-Confirmation Quarterly Report for the Fourth Quarter of 2010 is available at no charge at http://bankrupt.com/misc/Refco4thQ2010PostCon.pdf About Refco Inc. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- was a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries were members of principal U.S. and international exchanges, and were among the most active members of futures exchanges in Chicago, New York, London and Singapore. Refco was also a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco was one of the largest global clearing firms for derivatives. The Company had operations in Bermuda. The Company and 23 of its affiliates filed for Chapter 11 protection on October 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represented the Debtors in their restructuring efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its Chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on December 15, 2006. That Plan became effective on Dec. 26, 2006. Pursuant to the plan, RJM, LLC, was named plan administrator to reorganized Refco, Inc., and its affiliates, and Marc S. Kirschner as plan administrator to Refco Capital Markets, Ltd. Bankruptcy Creditors' Service, Inc., publishes Refco Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Refco Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) REGAL PLAZA: Hearing on Postpetition Financing Set for February 8 ----------------------------------------------------------------- Regal Plaza, LLC, has filed a motion seeking approval of postpetition financing from Tower Realty & Development, L.L.C., with the U.S. Bankruptcy Court for the District of Nevada, for the purpose of building and completing tenant improvements in the Debtor's shopping center. Tower has agreed to provide the approximately $826,000 in funds necessary to complete the tenant improvements. There is 56,097 square feet of rentable space, approximately 22,510 square feet are currently occupied and 23,187 square feet are currently being improved for tenants with signed leases. The hearing on the motion is set for February 8, 2011, at 1:30 p.m. Tower, a contractor licensed by the Nevada State contractors Board, is an affiliate of the Debtor because it is owned directly or indirectly by John and Louis Carnesale who own, indirectly, 81% of the Debtor. The property is worth approximately $8,600,000 and is subject to a loan in the approximate amount of $7,500,000 to the Nevada State Bank. The loan, which will be unsecured, will be made on an administrative priority basis but subordinate to Chapter 11 administrative expenses at the rate of 3% per annum. The proposed loan will be due upon confirmation of a plan of reorganization or conversion of the case to Chapter 7. About Regal Plaza, LLC Las Vegas, Nevada-based Regal Plaza, LLC, owns a shopping center in Las Vegas, Nevada. The shopping center was originally constructed in 2000 on 5.72 acres which are operated as the Regal Plaza. The Company filed for Chapter 11 bankruptcy protection on September 1, 2010 (Bankr. D. Nev. Case No. 10-26707). Lenard E. Schwartzer, Esq., at Schwartzer & Mcpherson Law Firm, in Las Vegas, Nev., represents the Debtor as counsel. In its schedules, the Debtor disclosed $10,815,564 in assets and $8,592,879 in liabilities as of the petition date. RHI ENTERTAINMENT: Seeks Approval on Exit Term Loan Facility ------------------------------------------------------------ BankruptcyData.com reports that RHI Entertainment filed with the U.S. Bankruptcy Court a motion for an order authorizing the Debtors to enter into exit facility letters with J.P. Morgan Chase Bank, J.P. Morgan Securities, and JPMCB. The financing consists of a new $25 million revolving credit facility and a $300 million term loan facility. The exit revolving facility will be used for working capital and other general corporate purposes, and will also help fund the Debtors' emergence from these Chapter 11 Cases. The exit term loan facility will not deliver any new cash proceeds to the Debtors, but will be issued, along with common stock in the reorganized Debtors, in exchange for the discharge of all claims arising under the Debtors' pre-petition first lien credit facility. About RHI Entertainment New York-based RHI Entertainment, Inc., develops, produces and distribute new made-for-television movies, mini-series and other television programming worldwide. It filed for Chapter 11 bankruptcy protection on December 10, 2010 (Bankr. S.D.N.Y. Case No. 10-16536). D.J. Baker, Esq., Rosalie Walker Gray, Esq., Keith A. Simon, Esq., Adam S. Ravin, Esq., and Jude Gorman, Esq., at Latham & Watkins LLP, serve as the Debtors' bankruptcy counsel. The Debtor disclosed $524,722,000 in total assets and $834,094,000 in total debts in its chapter 11 petition. Affiliates RHI Entertainment, LLC (Bankr. S.D.N.Y. Case No. 10-16537), RHIE Holdings Inc. (Bankr. S.D.N.Y. Case No. 10-16538), RHI Entertainment Holdings II, LLC (Bankr. S.D.N.Y. Case No. 10-16541), RHI Entertainment Distribution, LLC (Bankr. S.D.N.Y. Case No. 10-16549), RHI International Distribution Inc. (Bankr. S.D.N.Y. Case No. 10-16550), RHI Entertainment Productions, LLC (Bankr. S.D.N.Y. Case No. 10-16551), HE Pro Tunes, Inc. (Bankr. S.D.N.Y. Case No. 10-16552), HEGOA INC. (Bankr. S.D.N.Y. Case No. 10-16553), HEP Music, Inc. (Bankr. S.D.N.Y. Case No. 10-16554), HEP SS Music Inc. (Bankr. S.D.N.Y. Case No. 10-16555), Don Quixote, Inc. (Bankr. S.D.N.Y. Case No. 10-16556), Independent Projects, Inc. (Bankr. S.D.N.Y. Case No. 10-16557), Library Storage, Inc. (Bankr. S.D.N.Y. Case No. 10-16558), Metropolitan Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16560), NGP Holding, Inc. (Bankr. S.D.N.Y. Case No. 10-16561), and SLB Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16562) filed separate Chapter 11 petitions. Logan & Company, Inc., serves as the Debtors' claims and noticing agent. RHI's First Lien Lenders are represented by Michael A. Chapnick, Esq. -- mchapnick@morganlewis.com -- and Wendy S. Walker, Esq. -- wwalker@morganlewis.com -- at Morgan, Lewis & Bockius LLP, and RHI's Second Lien Lenders are represented by Mark R. Somerstein, Esq. -- mark.somerstein@ropesgray.com -- and Patricia I. Chen, Esq. -- patricia.chen@ropesgray.com -- at Ropes & Gray LLP. As reported in the Troubled Company Reporter on Dec. 16, 2010, RHI Entertainment Inc., won approval to put its prepackaged Chapter 11 case on a fast track and hold a combined disclosure statement and restructuring plan confirmation hearing as early as Feb. 17, 2011. The Prepackaged Plan provides that, on its Effective Date, (a) the First Lien Lenders will receive (i) $300 million of New Term Loan Obligations and (ii) roughly 99% of the New Common Stock (subject to dilution); and (b) the Second Lien Lenders will receive (i) roughly 1% of the New Common Stock (subject to dilution), (ii) New Warrants representing 15% ownership of the New Common Stock on a fully diluted basis, and (iii) a limited fee and expense reimbursement of up to $250,000. A hearing has been scheduled for Feb. 17, 2011, to consider the adequacy of the Disclosure Statement. RHI ENTERTAINMENT: Turns Over 15 Films to Settle $37.8MM Debt ------------------------------------------------------------- BankruptcyData.com reports that RHI Entertainment filed with the U.S. Bankruptcy Court a motion for an order approving a settlement and assignment agreement with U.S. Bank National Association and other parties who were borrowers of loans with respect to certain television motion pictures. BData says the settlement contemplates the grant, transfer and conveyance to U.S. Bank or its designated transferee of the RHI Entities' right, title, and interest to the pictures and certain related assets, the payment of certain monies derived from the pictures and certain related claims to U.S. Bank and the mutual release of certain liabilities between U.S. Bank, the borrowers and the RHI Entities. The Court scheduled a hearing on the matter for February 17, 2011. Eric Morath, writing for Dow Jones' Daily Bankruptcy Review, reports that as part of the settlment, RHI Entertainment is turning over rights to 15 made-for-TV movies, including Hannah's "Shark Swarm" to settle a $37.8 million debt. Mr. Morath relates that in papers field with the U.S. Bankruptcy Court in Manhattan, RHI said it will likely turn over its rights to some 40 films during the course of its case. About RHI Entertainment New York-based RHI Entertainment, Inc., develops, produces and distribute new made-for-television movies, mini-series and other television programming worldwide. It filed for Chapter 11 bankruptcy protection on December 10, 2010 (Bankr. S.D.N.Y. Case No. 10-16536). D.J. Baker, Esq., Rosalie Walker Gray, Esq., Keith A. Simon, Esq., Adam S. Ravin, Esq., and Jude Gorman, Esq., at Latham & Watkins LLP, serve as the Debtors' bankruptcy counsel. The Debtor disclosed $524,722,000 in total assets and $834,094,000 in total debts in its chapter 11 petition. Affiliates RHI Entertainment, LLC (Bankr. S.D.N.Y. Case No. 10-16537), RHIE Holdings Inc. (Bankr. S.D.N.Y. Case No. 10-16538), RHI Entertainment Holdings II, LLC (Bankr. S.D.N.Y. Case No. 10-16541), RHI Entertainment Distribution, LLC (Bankr. S.D.N.Y. Case No. 10-16549), RHI International Distribution Inc. (Bankr. S.D.N.Y. Case No. 10-16550), RHI Entertainment Productions, LLC (Bankr. S.D.N.Y. Case No. 10-16551), HE Pro Tunes, Inc. (Bankr. S.D.N.Y. Case No. 10-16552), HEGOA INC. (Bankr. S.D.N.Y. Case No. 10-16553), HEP Music, Inc. (Bankr. S.D.N.Y. Case No. 10-16554), HEP SS Music Inc. (Bankr. S.D.N.Y. Case No. 10-16555), Don Quixote, Inc. (Bankr. S.D.N.Y. Case No. 10-16556), Independent Projects, Inc. (Bankr. S.D.N.Y. Case No. 10-16557), Library Storage, Inc. (Bankr. S.D.N.Y. Case No. 10-16558), Metropolitan Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16560), NGP Holding, Inc. (Bankr. S.D.N.Y. Case No. 10-16561), and SLB Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16562) filed separate Chapter 11 petitions. Logan & Company, Inc., serves as the Debtors' claims and noticing agent. RHI's First Lien Lenders are represented by Michael A. Chapnick, Esq. -- mchapnick@morganlewis.com -- and Wendy S. Walker, Esq. -- wwalker@morganlewis.com -- at Morgan, Lewis & Bockius LLP, and RHI's Second Lien Lenders are represented by Mark R. Somerstein, Esq. -- mark.somerstein@ropesgray.com -- and Patricia I. Chen, Esq. -- patricia.chen@ropesgray.com -- at Ropes & Gray LLP. As reported in the Troubled Company Reporter on Dec. 16, 2010, RHI Entertainment Inc., won approval to put its prepackaged Chapter 11 case on a fast track and hold a combined disclosure statement and restructuring plan confirmation hearing as early as Feb. 17, 2011. The Prepackaged Plan provides that, on its Effective Date, (a) the First Lien Lenders will receive (i) $300 million of New Term Loan Obligations and (ii) roughly 99% of the New Common Stock (subject to dilution); and (b) the Second Lien Lenders will receive (i) roughly 1% of the New Common Stock (subject to dilution), (ii) New Warrants representing 15% ownership of the New Common Stock on a fully diluted basis, and (iii) a limited fee and expense reimbursement of up to $250,000. A hearing has been scheduled for Feb. 17, 2011, to consider the adequacy of the Disclosure Statement. RHI ENTERTAINMENT: U.S. Trustee Objects to Third-Party Releases --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Trustee opposes approval of RHI Entertainment Inc.'s reorganization plan, alleging that the Debtor is improperly proposing to give first and second-lien lenders immunity from lawsuits. The U.S. Trustee interpreted the plan as meaning that creditors would be precluded from suing noteholders for grossly negligent or willful misconduct. The plan even may bar suits based on criminal conduct, the U.S. Trustee said. Bankruptcy law doesn't permit giving immunity to third parties, other than in exceptional situations, the U.S. Trustee said. Exit Financing Mr. Rochelle also reports that RHI Entertainment last week filed a motion for approval of $325 million in revolving-credit and term- loan financing to kick in when the plan is confirmed. Terms of the financing were worked out in principle before bankruptcy with JPMorgan Chase Bank NA, the lender. The loans are to be approved at the Feb. 17 confirmation hearing. The financing includes a $25 million revolving credit. About RHI Entertainment New York-based RHI Entertainment, Inc., develops, produces and distribute new made-for-television movies, mini-series and other television programming worldwide. It filed for Chapter 11 bankruptcy protection on December 10, 2010 (Bankr. S.D.N.Y. Case No. 10-16536). D.J. Baker, Esq., Rosalie Walker Gray, Esq., Keith A. Simon, Esq., Adam S. Ravin, Esq., and Jude Gorman, Esq., at Latham & Watkins LLP, serve as the Debtors' bankruptcy counsel. The Debtor disclosed $524,722,000 in total assets and $834,094,000 in total debts in its chapter 11 petition. Affiliates RHI Entertainment, LLC (Bankr. S.D.N.Y. Case No. 10-16537), RHIE Holdings Inc. (Bankr. S.D.N.Y. Case No. 10-16538), RHI Entertainment Holdings II, LLC (Bankr. S.D.N.Y. Case No. 10-16541), RHI Entertainment Distribution, LLC (Bankr. S.D.N.Y. Case No. 10-16549), RHI International Distribution Inc. (Bankr. S.D.N.Y. Case No. 10-16550), RHI Entertainment Productions, LLC (Bankr. S.D.N.Y. Case No. 10-16551), HE Pro Tunes, Inc. (Bankr. S.D.N.Y. Case No. 10-16552), HEGOA INC. (Bankr. S.D.N.Y. Case No. 10-16553), HEP Music, Inc. (Bankr. S.D.N.Y. Case No. 10-16554), HEP SS Music Inc. (Bankr. S.D.N.Y. Case No. 10-16555), Don Quixote, Inc. (Bankr. S.D.N.Y. Case No. 10-16556), Independent Projects, Inc. (Bankr. S.D.N.Y. Case No. 10-16557), Library Storage, Inc. (Bankr. S.D.N.Y. Case No. 10-16558), Metropolitan Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16560), NGP Holding, Inc. (Bankr. S.D.N.Y. Case No. 10-16561), and SLB Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16562) filed separate Chapter 11 petitions. Logan & Company, Inc., serves as the Debtors' claims and noticing agent. RHI's First Lien Lenders are represented by Michael A. Chapnick, Esq. -- mchapnick@morganlewis.com -- and Wendy S. Walker, Esq. -- wwalker@morganlewis.com -- at Morgan, Lewis & Bockius LLP, and RHI's Second Lien Lenders are represented by Mark R. Somerstein, Esq. -- mark.somerstein@ropesgray.com -- and Patricia I. Chen, Esq. -- patricia.chen@ropesgray.com -- at Ropes & Gray LLP. As reported in the Troubled Company Reporter on Dec. 16, 2010, RHI Entertainment won approval to put its prepackaged Chapter 11 case on a fast track and hold a combined disclosure statement and restructuring plan confirmation hearing as early as Feb. 17, 2011. The Prepackaged Plan provides that, on its Effective Date, (a) the First Lien Lenders will receive (i) $300 million of New Term Loan Obligations and (ii) roughly 99% of the New Common Stock (subject to dilution); and (b) the Second Lien Lenders will receive (i) roughly 1% of the New Common Stock (subject to dilution), (ii) New Warrants representing 15% ownership of the New Common Stock on a fully diluted basis, and (iii) a limited fee and expense reimbursement of up to $250,000. A hearing has been scheduled for Feb. 17, 2011, to consider the adequacy of the Disclosure Statement. ROCKWOOD SPECIALTIES: S&P Upgrades Corporate Credit Rating to 'BB' ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its ratings on Rockwood Specialties Group Inc., including its corporate credit rating to 'BB' from 'BB-'. The outlook is stable. At the same time, S&P assigned S&P's '1' recovery rating and 'BBB-' issue rating to Rockwood's proposed first-lien senior secured credit facilities, consisting of a $180 million revolving credit facility and a $850 million term loan. The '1' recovery rating indicates S&P's expectation for very high recovery (90%-100%) in the event of a payment default. The issue rating on existing subordinated debt was raised to 'B+', while the recovery rating remains '6', indicating negligible recovery (0%-10%) in the event of a payment default. "Our rating action reflects improvements to the Company's leverage-related credit metrics on a pro forma basis, and our expectation that Rockwood's satisfactory business profile, the improved operating environment, and a prudent financial policy will sustain credit metrics at levels appropriate for the ratings," said Standard & Poor's credit analyst Paul Kurias. Proceeds from the proposed credit facilities, along with cash on the balance sheet, are expected to pay down the existing $180 million revolving credit facility and approximately $1,250 million in term loans outstanding. S&P will withdraw its ratings on the Company's existing credit facilities on completion of the proposed transaction and following the paydown of existing debt as proposed by Rockwood. ROTHSTEIN ROSENFELDT: Ex-Partner Settles Clawback Suit for $350T ---------------------------------------------------------------- Peter Franceschina, staff writer for the Sun Sentinel, reports that Russell Adler, one of Ponzi schemer Scott Rothstein's former law partners, has agreed to pay $350,000 to settle a clawback suit by the trustee overseeing the Rothstein Rosenfeldt Adler law firm bankruptcy case. The report says if Mr. Adler fails to pay the money within 2-1/2 years, a judgment for $500,000 will be entered against him. According to the report, the bankruptcy attorneys marshaling the firm's assets agreed to the settlement, in part, because there is little likelihood Mr. Adler would be able to pay a hefty judgment, according to court documents that outline Mr. Adler's financial condition. The report notes the settlement comes ahead of a trial on the clawback suit that was scheduled for February 14. Mr. Adler has said he knew nothing about Mr. Rothstein's massive $1.4 billion investment fraud scheme, and he admitted no wrongdoing in the settlement. The $350,000 will go toward paying back the creditors of Mr. Rothstein's law firm. According to the report, to pay the money, Mr. Adler agreed to give up half of the legal fees he earns from cases he is handling that originated with his former law firm, and 15% of the fees from new cases. He also agreed to surrender a $90,000 retirement account. The report relates the bankruptcy attorneys were seeking $1.2 million from Mr. Adler, alleging he was overpaid and received loans from the law firm that were not repaid. The clawback suit alleged Adler and his wife used $475,000 of that money to buy a Manhattan co-op apartment. Mr. Adler surrendered the apartment to the federal government as part of the criminal forfeiture proceedings against Rothstein. The deal is subject to bankruptcy court approval. $775,000 for 2 Settlements Dow Jones' DBR Small Cap reports that the trustee charged with rounding up assets for creditors of Scott Rothstein's defunct Florida law firm has struck a pair of settlements that would pump a total of $775,000 into the estate, including one with the state's Republican party. About Rothstein Rosenfeldt Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA -- http://www.rra-law.com/-- has been suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed November 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non- existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on January 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. On June 10, 2010, Mr. Rothstein was sentenced to 50 years in prison. ROTHSTEIN ROSENFELDT: Republican Party to Return $75,000 -------------------------------------------------------- Peter Franceschina, staff writer for the Sun Sentinel, reports that the Republican Party of Florida has agreed to cough up $75,000 in contributions from Ponzi schemer Scott Rothstein, to settle a clawback lawsuit filed by bankruptcy attorneys. According to the report, Mr. Rothstein gave roughly $237,000 to the state party through multiple contributions. After Mr. Rothstein's fraud came to light, the Republican party returned $90,000 to the federal government, which went into a restitution fund for the fraudster's victims. The Sun Sentinel says the state party denied it had any responsibility to return the contributions. The report, however, relates bankruptcy attorneys and party officials began negotiating behind the scenes, and on December 12 the party's board of directors voted to approve the $75,000 settlement, according to papers filed in bankruptcy court. The deal is subject to bankruptcy court approval. About Rothstein Rosenfeldt Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA -- http://www.rra-law.com/-- has been suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed November 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non- existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on January 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. On June 10, 2010, Mr. Rothstein was sentenced to 50 years in prison. ROTHSTEIN ROSENFELDT: Utica Advisors Settles for $700,000 --------------------------------------------------------- Peter Franceschina, staff writer for the Sun Sentinel, reports bankruptcy attorneys in the Rothstein Rosenfeldt Adler law firm have reached a proposed $700,000 settlement with New York-based Utica Advisors, which invested late in Scott Rothstein's Ponzi scheme. According to the report, papers filed in court says Utica Advisors invested $1.8 million with Mr. Rothstein in July 2009 and was to be repaid $2.6 million over three months, but received only $2.3 million before the fraud's collapse. The deal is subject to bankruptcy court approval. About Rothstein Rosenfeldt Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA -- http://www.rra-law.com/-- has been suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed November 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non- existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on January 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. On June 10, 2010, Mr. Rothstein was sentenced to 50 years in prison. ROYAL CARIBBEAN: Moody's Raises Corp. Credit Rating to 'Ba1' ------------------------------------------------------------ Moody's Investors Service upgraded Royal Caribbean Cruises, Ltd.'s Corporate Family Rating to Ba1 from Ba2. "The upgrade reflects the improving cruise price environment that we expect to drive higher earnings, and an improvement in the company's operating margins and credit metrics", said Moody's Senior Credit Officer Peggy Holloway. Additionally, the upgrade considers Moody's expectation that RCL will generate positive free cash flow after capital spending beginning in 2011. Ratings upgraded -- Corporate Family Rating to Ba1 from Ba2 -- Probability of Default Rating to Ba1 from Ba2 -- Senior Unsecured Notes and Debentures to Ba2 (LGD 5, 75%) from Ba3 (LGD 4, 64%) -- Euro 1.0B Senior Unsecured Global Notes to Ba2 (LGD 5, 75%) from Ba3 (LGD 4, 64%) -- Senior unsecured shelf registration to (P)Ba2 (LGD 5, 75%) from (P)Ba3 (LGD 4, 64%) -- Preferred stock shelf registration to (P)Ba2 (LGD 6, 97%) from (P)B1 (LGD 6, 97%) Rating affirmed -- Speculative Grade Liquidity Rating at SGL-3 RCL's Ba1 Corporate Family Rating considers the company's position as the second largest global cruise operator, and its well diversified position with respect to brands and market segments. The ratings also reflect RCL's high leverage, low return on assets, and the capital intensive nature of the cruise industry. The anticipated improvement in cruise pricing and earnings is expected to result in a modest improvement in credit metrics. RCL's retained cash flow to net debt at year-end 2010 remains low at around 12%. However, Moody's estimates that pro-forma net debt to retained cash flow was approximately 14%. Additionally, beginning in 2011, Moody's expects RCL's cash flow from operations to exceed its capital spending needs as capacity expansion drops to just one vessel respectively in 2011 and 2012. Moody's anticipates that RCL will apply its free cash flow towards debt reduction, increasing its retained cash flow to net debt to at least 15% by year-end 2011. The stable rating outlook reflects Moody's expectation that rising ticket prices and capacity expansion will enable RCL to improve its debt protection metrics over the next 12-18 months to levels that place it comfortably within the Ba1 rating category. Over time, RCL's ratings could be upgraded if the company continues to grow operating margins and if retained cash flow to net debt can be sustained at 18% and EBIT/interest at 3.0 times. The ratings could be downgraded if retained cash flow to net debt or EBIT to interest does not trend towards 15% and 2.5 times, respectively, by year-end 2011. Royal Caribbean Cruises Ltd. is a global cruise vacation company that operates five cruise brands -- the largest being Royal Caribbean International and Celebrity Cruises -- and 40 cruise ships with two under construction. Revenues for the fiscal year ended December 31, 2010, were about $6.8 billion. The principal methodologies used in this rating were Global Lodging & Cruise Industry Rating Methodology published in December 2010, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. SAVE OUR SPRINGS: 5th Cir. Affirms Chapter 11 Plan Rejection ------------------------------------------------------------ WestLaw reports that a Chapter 11 debtor that had asserted "small business debtor" status in its original petition was judicially estopped from denying that it was a small business debtor in order to belatedly gain additional time to file a plan after the deadline for submission of a plan as a small business debtor expired. The debtor's current position that it was not a small business debtor was clearly inconsistent with its previous one, and the court had accepted the debtor's original position, such as by allowing the debtor to file its plan without a disclosure statement. Finally, the debtor, which continued to assert its small business status even after it had reason to doubt the accuracy of that statement, had benefited from asserting this position. Save Our Springs (S.O.S.) Alliance, Inc. v. WSI (II)- COS, L.L.C., --- F.3d ----, 2011 WL 227693 (5th Cir.). A copy of the Fifth Circuit's decision dated Jan. 26, 2011, is available at http://is.gd/dDoTC5from Leagle.com. Save Our Springs Alliance -- http://www.sosalliance.org/-- is a non-profit organization whose aim is to protect the Edwards Aquifer in Texas, its springs and contributing streams, and the natural and cultural heritage of its Hill Country watersheds, with special emphasis on the Barton Springs Edwards Aquifer. The Alliance sought chapter 11 protection (Bankr. W.D. Texas Case No. 07-10642) on April 10, 2007, after the Texas Supreme Court upheld the Court of Appeals ruling and declined to review the case Save Our Springs Alliance v. Lazy Nine Municipal Utility District. In addition, SOS Alliance was directed to pay $500,000 in attorneys' fees. Weldon Ponder, Esq., represents the Debtor. S.O.S. filed a Chapter 11 plan in September 2007, but the Bankruptcy Court refused to confirm the plan. Following the confirmation hearing, as reported in the Troubled Company Reporter on Apr. 18, 2008, the bankruptcy court issued an opinion refusing to confirm the reorganization plan. It explained that the plan was not feasible, because S.O.S. had not demonstrated a sufficiently firm commitment from its donors to contribute $60,000 necessary to fund the plan. In re Save Our Springs (S.O.S.) Alliance, Inc., 388 B.R. 202, 239-44 (Bankr. W.D. Tex. 2008). Moreover, it held that the plan improperly classified a judgment creditor-transferee separately from the other unsecured creditors in an attempt to gerrymander the class voting. Id. at 233-38. SAVERS INC: Moody's Affirms 'B1' Corporate Family Rating -------------------------------------------------------- Moody's Investors Service affirmed the B1 corporate family and B2 probability of default ratings for Savers, Inc., as well as the Ba3 rating on its senior secured credit facility following its announced plan to increase its term loan to fund an acquisition. The transaction increases debt-to-EBITDA to the high 5 times range from approximately 5.4 times and leaves the rating weakly positioned. However, Moody's anticipates leverage will decline over time with both EBITDA growth and debt repayment, and the proposed acquisition increases scale and modestly enhances geographic diversity. Savers intends to increase its term loan by approximately $135 million, which, combined with approximately $20 million of cash equity from existing owner Freeman Spogli & Co. and Savers chairman Tom Ellison, will fund the acquisition of 18 stores from Apogee, a thrift store operator owned by Golden Gate Capital. In Moody's opinion, the combination creates minimal integration risk given the comparable business models, and the Apogee stores to be acquired are currently profitable. A summary of the action: Savers, Inc. -- Affirmed B1 Corporate Family Rating -- Affirmed B2 Probability of Default Rating -- Affirmed Ba3 rating on Senior Secured Bank Credit Facility, LGD adjusted to LGD2, 29% from LGD2, 27% Outlook, Stable Savers high leverage positions it weakly for its B1 corporate family rating. However, given the company's proven resilience of performance throughout economic cycles, including consistent same store sales growth, Savers can manage the high debt load more easily than some of its more volatile retail peers. Savers remains small relative to other rated retail operators, but benefits from good growth prospects. Good liquidity, including expectations for positive free cash flow, supports the rating. The stable outlook incorporates expectations for successful integration of the Apogee stores and some debt reduction with positive free cash flow, which should facilitate a decline in leverage to the low 5 times range over time. The purchase agreement includes a 3 year option for Savers to acquire 12 additional Apogee stores. A modest increase in debt to fund this acquisition would not necessarily have negative ratings implications provided we anticipated continued positive free cash flow and a return to more appropriate credit metrics over the intermediate term. Any operational challenges contributing to an inability to generate free cash flow or lack of progress on reducing leverage toward the low 5 times range could result in a negative outlook or downgrade. A deterioration of the liquidity profile or sustained declines in same store sales would also likely negatively impact the rating. The weak positioning of the B1 corporate family rating and the company's lack of scale limit upward ratings momentum. An upgrade or positive outlook is highly unlikely absent a transformative transaction that materially improved both scale and credit metrics. The most recent rating action for Savers occurred on March 19, 2010. At that time Moody's upgraded the CFR to B1 from B2. The principal methodologies used in this rating were Global Retail Industry published in December 2006, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Seattle, Washington, Savers, Inc., operates approximately 250 for-profit secondhand stores in the United States, Canada, and Australia under the Savers, Value Village, and Village des Valeurs brand names. Its annual revenue is approximately $765 million. SEALY CORP: Reports $13.74 Million Net Loss in Fiscal 2010 ---------------------------------------------------------- On January 21, 2011, Sealy Corporation filed its annual report on Form 10-K for the fiscal year ended November 28, 2010. Sealy Corp. reported a net loss of $13.74 million on $1.22 billion of net sales for fiscal year ended Nov. 28, 2010, compared with net income of $13.48 million on $1.17 billion of net sales for fiscal year ended Nov. 29, 2009, The Company's balance sheet at November 28, 2010, showed $936,757,000 in total assets, $1,024,396,000 in total liabilities and a $87,639,000 stockholders' deficit. A full-text copy of the Annual Report is available for free at: http://ResearchArchives.com/t/s?7276 About Sealy Corp. Trinity, North Carolina-based Sealy Corp. (NYSE: ZZ) -- http://www.sealy.com/-- is the largest bedding manufacturer in the world with sales of $1.5 billion in fiscal 2008. The Company manufactures and markets a broad range of mattresses and foundations under the Sealy(R), Sealy Posturepedic(R), including SpringFree(TM), PurEmbrace(TM) and TrueForm(R); Stearns & Foster(R), and Bassett(R) brands. Sealy operates 25 plants in North America, and has the largest market share and highest consumer awareness of any bedding brand on the continent. In the United States, Sealy sells its products to approximately 3,000 customers with more than 7,000 retail outlets. Sealy carries 'B' local and issuer credit ratings from Standard & Poor's. SEDGWICK HOLDING: Moody's Cuts Rating on First-Lien Facility to B2 ------------------------------------------------------------------ Moody's Investors Service lowered the first-lien credit facility rating of Sedgwick Holdings, Inc., to B2 from B1. This concludes a review for downgrade that was initiated following the company's announcement that it will acquire Specialty Risk Services, Inc. (SRS), a third-party claims administrator to self-insured, insured and alternative market clients. The downgrade in the first-lien credit facility rating reflects an expected increase in financial leverage. In the same action, Moody's affirmed the B2 corporate family rating and the B3 second-lien term loan rating of Sedgwick. The rating outlook for the company is stable. The transaction is subject to customary approval and is expected to close in the first quarter of 2011. "The SRS purchase will enhance Sedgwick's scale and broaden its client and product diversification. Over the longer term, the transaction may generate cross selling opportunities among clients of the two firms," said Enrico Leo, Moody's lead analyst for Sedgwick. Offsetting these benefits include an increased debt burden and the potential for business disruptions during the integration phase. The SRS acquisition will be the largest completed by Sedgwick since its leveraged acquisition of CMI in September 2006. Financing for the SRS transaction is expected to consist of a combination of debt, equity and cash on hand. Sedgwick's current debt load consists of $400 million in first-lien debt and $200 million in second lien debt. Sedgwick's adjusted debt-to- EBITDA ratio, as measured by Moody's, was 5.9x for the 12 months through September 2010. Moody's cited the following factors that could lead to a rating upgrade for Sedgwick: (i) a long term commitment to lower financial leverage (i.e. debt-to-EBITDA below 4.5x), (ii) free cash flow-to-debt of 6% or better, and (iii) interest coverage of 3x or better. Conversely, the following factors that could lead to a downgrade: (i) debt-to-EBITDA ratio over 6.5x, (ii) free cash flow-to-debt of 3% or less, or (iii) interest coverage below 1.5x. Sedgwick is one of the largest claims service providers in the United States. The company processes claims for a wide range of insurance product lines including workers' compensation, general liability, and disability insurance. For 2009, the company generated revenues of $703 million. The principal methodology used in this rating was Moody's Global Rating Methodology for Insurance Brokers & Service companies, published January 2008. SH EXPLORATION: Chapter 11 Case Transferred to Dallas ----------------------------------------------------- The U.S. Bankruptcy court for the District of Nevada, Las Vegas Division, entered an order transferring SH Exploration, L.L.C.'s Chapter 11 case to Dallas (Bankr. N.D. Texas Case No. 11-30552). The transfer was made effective January 26, 2011. Dallas, Texas-based SH Exploration filed for Chapter 11 protection (Bankr. D. Nev. Case No. 10-18072) on May 3, 2010 in Las Vegas. The Debtor estimated assets of up to $50,000 and debts of up to $10,000,000 in its Chapter 11 petition. SH Exploration is a debtor-affiliate of Eurenergy Resources Corporation. Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, in Las Vegas, represents the Debtors. SOUTH PADRE INVESTMENT: Files for Chapter 11 in Corpus Christi -------------------------------------------------------------- South Padre Investment, LP, filed a bare-bones Chapter 11 petition (Bankr. S.D. Tex. Case No. 11-20056) on Jan. 29, 2011 in Corpus Christi, Texas. Glendale, California-based South Padre estimated assets of $10 million to $50 million and debts of $1 million to $10 million as of the Petition Date. Kevin J. Burke, as authorized representative of general partner, Donore Investment Inc., signed the Chapter 11 petition. According the list of equity security holders, Valleywinds, Inc. holds 99% of the stock while Donore owns 1%. SOUTH PADRE INVESTMENT: Voluntary Chapter 11 Case Summary --------------------------------------------------------- Debtor: South Padre Investment, LP fdba South Padre Investment, Inc. 206 South Brand Boulevard Glendale, CA 91204 Bankruptcy Case No.: 11-20056 Chapter 11 Petition Date: January 29, 2011 Court: U.S. Bankruptcy Court Southern District of Texas (Corpus Christi) Judge: Richard S. Schmidt Debtor's Counsel: James S. Wilkins, Esq. WILLIS & WILKINS 100 W. Houston Street, Suite 1275 San Antonio, TX 78205 Tel: (210) 271-9212 Fax: (210) 271-9389 E-mail: jwilkins@stic.net Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The list of unsecured creditors filed together with its petition does not contain any entry. The petition was signed by Kevin J. Burke, authorized representative of Donore Investment, Inc., general partner. SPRING ER: Court Okays Randy Williams as Chapter 11 Trustee ----------------------------------------------------------- Judy A. Robbins, the United States Trustee for Region 7, sought and obtained authorization from the Hon. Jeff Bohm of the U.S. Bankruptcy Court for the Southern District of Texas to appoint Randy W. Williams as Chapter 11 trustee in Spring ER, LLC's bankruptcy case. To the best of the U.S. Trustee's knowledge, Mr. Williams has no connections with the debtors, creditors, any other parties in interest, their respective attorneys and accountants, the U.S. Trustee, and any persons employed in the Office of the U.S. Trustee save and except he is the Chapter 7 trustee in the case of Quality Infusion Care, Inc., 10-36675-H4-7. Houston, Texas-based Spring ER, LLC, filed for Chapter 11 bankruptcy protection on January 21, 2011 (Bankr. S.D. Tex. Case No. 11-30609). Leonard H. Simon, Esq., at Pendergraft & Simon L.L.P., serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. SPRING ER: Chapter 11 Trustee Wants Case Converted to Chapter 7 --------------------------------------------------------------- Randy W. Williams, Chapter 11 trustee for Spring ER, LLC, asks the Hon. Jeff Bohm of the U.S. Bankruptcy Court for the Southern District of Texas to convert the Debtor's Chapter 11 bankruptcy case to a case under Chapter 7. The Chapter 11 Trustee says that based on the current known situation, the Debtor has no legitimate prospects for reorganization, would not be able to confirm a Chapter 11 plan and should be liquidated under Chapter 7. According to the Chapter 11 Trustee, the Debtor doesn't have any ongoing operations and doesn't have sufficient cash resources to meet its ongoing obligations. "The Debtor lacks sufficient management. A confirmable plan cannot be proposed. Even if a liquidating plan could be confirmed, no benefit is realized from a liquidating Chapter 11 plan versus a Chapter 7 under the circumstances present in this case. Consequently, the Trustee has determined that the prompt conversion of this case is in the best interest of the estate and its creditors," the Chapter 11 Trustee says. Houston, Texas-based Spring ER, LLC, filed for Chapter 11 bankruptcy protection on January 21, 2011 (Bankr. S.D. Tex. Case No. 11-30609). Leonard H. Simon, Esq., at Pendergraft & Simon L.L.P., serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. STEELCASE INC: S&P Assigns Preliminary 'BB+' Debt Ratings --------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary 'BBB-' and 'BB+' senior unsecured and subordinated debt ratings to Grand Rapids, Mich.-based Steelcase Inc.'s Rule 415 shelf registration for debt securities. Standard & Poor's also assigned its 'BBB-' rating to the Company's proposed $250 million of senior unsecured notes due 2021 to be issued under this shelf registration. Steelcase has indicated that it intends to use the proceeds from the new note issuance to repay its existing $250 million 6.5% senior unsecured notes due August 2011. The rating on the existing senior unsecured notes will be withdrawn once the debt has been repaid. The 'BBB-' long-term corporate credit rating on Steelcase and the negative outlook remain unchanged. The 'BBB-' rating reflects the Company's fair business risk profile, characterized by its leading market positions in the office furniture industry and broad distribution capabilities, and significant financial risk profile. The negative outlook reflects credit measures that remain weak for the rating, despite some improvement in recent periods as the Company's businesses have begun to recover. Although S&P expects continued improvement over the near term, if Steelcase is unable to reduce leverage below 3x over the next year, S&P could lower the ratings. Ratings List Steelcase Inc. Corporate Credit Rating BBB-/Negative/-- New Ratings Steelcase Inc. Senior Unsecured $250 mil notes due 2021 BBB- STEVEN-THOMAS: Don Presley Auctions to Liquidate Last Inventory --------------------------------------------------------------- Over the weekend of Feb. 5-6, Don Presley Auctions will liquidate the remaining inventory of Steven-Thomas Antiques and Interiors, which is closing its doors. "Some of the finest oceanfront residences in southern California have benefited from the imaginative design concepts of Steven- Thomas," said auctioneer Don Presley. "The company is very well known here in Orange County, and they've sold $150 million in antique furniture since opening their doors." Steven-Thomas also catered to a large celebrity clientele that included the late John Wayne, who resided in Newport Beach. Their custom work is also on view in the Dorothy Chandler House in the stylish Los Angeles neighborhood of Hancock Park, where they were commissioned to install antique kitchen buffets. The idea behind Steven-Thomas germinated in 1971 while Steven Shedd was living in Italy and playing on a baseball team. "I was going back and forth to Italy, and a friend said, 'You should get into antiques.' That was when dealers were just started to ship antiques from Europe to America in containers," Shedd recalled. He and his wife decided to cast out their nets to see if the idea had any potential. They started traveling all over northern Italy, buying up the type of furniture that could be bought cheaply there and resold easily in the States. "While there was an abundance of English rolltop desks and gateleg tables at the time, that wasn't the case with high-end Italian Renaissance Revival furniture," Shedd said. "We knew we had found an opportunity in the marketplace." In 1980, the Shedd and Silk families purchased land on the 55 Freeway five minutes from the John Wayne Airport, and designed and built the Steven-Thomas showroom. It has served as their base of operation ever since but now has been sold to make way for a computer assembly company. The Feb. 5-6 auction includes palatial Italian and French antique bedroom and dining room suites, armoires, tables, cabinets, mirrors, crystal chandeliers and decorative art objects. Internet live bidding will be available through LiveAuctioneers.com. Steven-Thomas Antiques and Interiors is Southern California's renowned Steven-Thomas Antiques and Interiors, which is closing its doors. Founded in 1979 by brothers-in-law Steven Shedd and Thomas Silk, the prestigious Orange County antiques and restoration firm has operated from the same Santa Ana venue since 1979, redesigning and repurposing antiques for functional use in today's homes. SUPERMEDIA INC: Files Post-Confirmation Report for Dec. 31 Qtr. --------------------------------------------------------------- On January SuperMedia Inc., formerly known as Idearc Inc., and all of its domestic subsidiaries filed their unaudited consolidated post-confirmation quarterly operating report for the quarter ending December 31, 2010, with the Office of the United States Trustee for the Northern District of Texas, Dallas Division. The quarterly report is limited in scope, covers a limited time period and has been prepared solely for the purpose of complying with the quarterly reporting requirements of the United States Trustee for the Northern District of Texas. Furthermore, the quarterly report contains information that has not been audited or reviewed by independent accountants, has not been presented in accordance with accounting principles generally accepted in the United States of America and may be subject to future reconciliation and adjustments. SuperMedia Inc. (Idearc Inc.) ended the quarter with $0 cash: Beginning of Quarter Cash Balance $0 Total Receipts $297,658,000 General Business Payments $297,658,000 Cash Balance End of Quarter $0 SuperMedia LLC (Idearc Media LLC) ended the quarter with $173,989,000 cash: Beginning of Quarter Cash Balance $330,734,000 Total Cash Receipts $259,557,000 Payments Under the Plan $2,475,000 General Business Payments $413,826,000 Total Disbursements $416,302,000 Cash Balance End of Quarter $173,989,000 SuperMedia Sales - East Co. (Idearc Media Sales - East Co.) ended the quarter with $0 cash: Beginning of Quarter Cash Balance $0 Total Cash Receipts ($33,635,000) General Business Payments ($33,635,000) Cash Balance End of Quarter $0 SuperMedia Sales - East LLC (Idearc Media Sales - East LLC) ended the quarter with $0 cash: Beginning of Quarter Cash Balance $0 Total Cash Receipts ($1,031,000) General Business Payments ($1,031,000) Cash Balance End of Quarter $0 SuperMedia Services - West Inc. (Idearc Media Services - West Inc.) ended the period with $0 cash: Beginning of Quarter Cash Balance $0 Total Cash Receipts $1,673,000 General Business Payments $1,673,000 Cash Balance End of Quarter $0 SuperMedia Services - East Inc. (Idearc Media Services - East Inc.) ended the period with $0 cash: Beginning of Quarter Cash Balance $0 Total Cash Receipts ($3,567,000) General Business Payments ($3,567,000) Cash Balance End of Quarter $0 SuperMedia Sales - West Inc. (Idearc Media Sales - West Inc.) ended the period with $0 cash: Beginning of Quarter Cash Balance $0 Total Cash Receipts ($80,119,000) General Business Payments ($80,119,000) Cash Balance End of Quarter $0 SuperMedia Information Services LLC (Idearc Information Services LLC), License Application Corporation, and Second License Application Corporation, all ended the quarter with $0 cash. These companies had no transactions involving cash during the quarter. A full-text copy of the post-confirmation quarterly report is available for free at: http://researcharchives.com/t/s?726c About Idearc Inc. Headquartered in Supermedia Inc., formerly known as Idearc Inc., (NASDAQ: SPMD) -- http://supermedia.com/-- is one of the largest yellow pages directories publishers in the United States as measured by revenues, and believes it has a strong presence in the online local search market. Idearc Inc. and its domestic subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code on March 31, 2009 (Bankr. N.D. Tex. Lead Case No. 09-31828). On September 8, 2009, the Company filed its First Amended Joint Plan of Reorganization with the Bankruptcy Court, which was later modified on November 19, 2009, and on December 22, 2009, the Bankruptcy Court entered an order approving and confirming the Amended Plan. On December 31, 2009, the Company emerged from bankruptcy and changed its name to SuperMedia. At September 30, 2010, Supermedia and subsidiaries' consolidated balance sheet showed $3.139 billion in total assets, $3.192 billion in total liabilities, and stockholders' equity of $53.0 million. At September 30, 2010, total long-term debt was $2.496 billion, down from $2.750 billion at December 31, 2009 (date of emergence). SWB WACO: Chapter 11 Plan Declared Effective on Jan. 25, 2011 ------------------------------------------------------------- On Dec. 23, 2010, the United States Bankruptcy Court for the Southern District of Texas confirmed the First Amended Chapter 11 Plan of Reorganization submitted by SWB Waco SH, LP. The Effective Date under the Plan occurred on Jan. 25, 2011. The Plan provides for the rejection of all of the Debtor's remaining executory contracts and unexpired leases. Any claim for damages arising from the rejection of an executory contract or unexpired lease must be asserted in a proof of claim filed with the Bankruptcy Court no later than 20 days following the earlier of (a) the date of entry of an order of the Bankruptcy Court approving such rejection, or (b) the Effective Date of the Plan. The Debtor's unsecured creditors will receive their pro rata share of $100,000 the Debtor promises to pay in four annual $25,000 installments on Jan. 25, 2012, 2013, 2014, and 2015. Sugar Land, Texas-based SWB Waco SH, L.P., owns an operates a recently constructed 374-bed apartment complex in Waco, Texas known as Heritage Quarters. The Property is part of a re- development project of the downtown Waco area and serves primarily as an off-campus student housing facility for Baylor University. SWB Waco sought Chapter 11 protection (Bankr. S.D. Texas Case No. 10-38001) on Sept. 7, 2010. The U.S. Trustee was unable to form an official committee of unsecured creditors in this case. David Ronald Jones, Esq., at Porter & Hedges LLP, and the law firm of Walker & Patterson, P.C., represent the Debtor in their chapter 11 restructuring. In its schedules, the Debtor disclosed assets of $19,642,118 and liabilities of $18,893,370 as of the petition date. SYNERGY BRANDS: Files for Chapter 7 Liquidation ----------------------------------------------- Synergy Brands Inc., a grocery distributor from Syosset, New York, filed a Chapter 7 liquidation petition (Bankr. E.D.N.Y. Case No. 11-70412) on Jan. 28 in Central Islip, New York. Two of its subsidiaries, PHS Group Inc. and SYBR.com Inc., also filed for bankruptcy under Chapter 7 of Title 11 of the United States Bankruptcy Code. Under Chapter 7 of the Bankruptcy Code, the Court is expected to appoint one or more Trustees to liquidate the aforementioned entities. It is expected that the Company or its Trustee will issue another press release identifying the Trustee and the related contact information. All matters concerning the Company and each of the two subsidiaries named above should be directed to the appropriate appointed Trustee. The Company also operates Quality Food Brands, Inc. (a Nevada corporation), in Monroe Michigan, which is currently operating as a going concern. The filings do not involve Quality Food Brands, Inc. Synergy Brands, Inc. -- http://www.synergybrands.com/-- develops Internet properties that strategically partner with off-line and on-line media companies to capture e-commerce markets within the B2B and B2C Internet arena. The company has developed the following Web sites: Netcigar.com, BeautyBuys.com, and DealByNet.com/ According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, the petition listed assets of $21.7 million and debt totaling $44.7 million. Liabilities include $23.7 million in secured debt. TERREMARK WORLDWIDE: Verizon Deal Cues S&P's 'B-' Rating -------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B-' corporate credit rating and all issue ratings on Miami-based datacenter operator and managed service provider Terremark Worldwide Inc. on CreditWatch with positive implications. The rating action follows the announcement that Verizon Communications Inc. (A-/Stable/A-2) has entered a definitive agreement to acquire Terremark's equity for about $1.4 billion, subject to a valid tender offer for a majority of Terremark's shares, plus assumed debt of about $545 million. The CreditWatch includes Terremark's $470 million senior secured notes rated 'B-' and its $75 million senior notes rated 'CCC', which Verizon said it intends to refinance. Standard & Poor's will monitor the tender offer, which Verizon expects to launch in mid-February and close by late March. "If the acquisition is completed as planned, we would likely raise and then immediately withdraw the corporate credit rating on Terremark," said Standard & Poor's credit analyst Michael Senno. "We would also likely raise the issue-level ratings on Terremark's debt, and subsequently withdraw these ratings if the debt is refinanced by Verizon." TOWNSENDS INC: Gets Interim Nod of Loan; Feb. 15 Auction Set ------------------------------------------------------------ Townsends, Inc., received final approval from the United States Bankruptcy Court for the District of Delaware for a $12 million debtor-in-possession financing facility. The company had received interim approval to access up to $7 million of the $12 million final facility. Townsends also received approval for bid procedures for an auction process to sell the Company, in whole or in part. The process calls for bids by February 14, 2011, with the auction to follow on February 15, 2011. A hearing to consider approval of the sale is currently scheduled to be held before the Honorable Christopher S. Sontchi, United States Bankruptcy Judge, on February 17, 2011, with, if approved, a closing(s) anticipated very shortly thereafter. "We are extremely gratified that our employees, customers and suppliers have shown tremendous support during this difficult time. After carefully considering the Company's alternatives, the Company's management and its Board of Directors determined that a sale of all or part of the Company's assets would provide the opportunity for the best outcome for all of our stakeholders," said Frederick B. Beilstein III, Chief Executive Officer. "Multiple bidders have expressed interest in acquiring the Company. The Company's management and financial and legal advisors are working closely with interested bidders as we approach the anticipated February 15th auction and will continue to work with a successful bidder(s) to limit any disruption in operations during the transition process." The DIP financing facility, combined with cash flows generated from ongoing operations, allows the Company to continue its business operations on a normalized basis until the closing of the transaction(s). On December 19, 2010, Townsends, Inc. and four wholly owned subsidiaries filed voluntary petitions for relief under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. About Townsends Inc. Founded in 1891, Townsends Inc. is a third-generation, family- owned poultry company. Headquartered in Georgetown, Delaware, Townsends operates production and processing facilities in Arkansas and North Carolina. Townsends Inc. -- fka Townsend Speciality Foods -- and several affiliates filed for Chapter 11 bankruptcy protection on December 19, 2010 (Bankr. D. Del. Lead Case No. 10-14092). As of December 5, 2010, the Debtors disclosed $131 million in total assets and $127 million in total debts. Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell, serves as the Debtors' bankruptcy counsel. McKenna Long & Aldridge LLP serves as special counsel. Huron Consulting Group's Dalton T. Edgecomb serves as the Debtors' chief restructuring officer. SSG Capital Advisors, LLC, serves as investment banker. Donlin, Recano & Company, Inc., is the Debtors' claims, noticing and balloting agent. An Official Committee of Unsecured Creditors has been appointed in the case. The Committee has tapped Lowenstein Sandler PC as its counsel and J.H. Cohn LLP as its financial advisor. TRANSTAR HOLDING: S&P Puts 'BB-' Rating on $290MM Debt Facilities ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating on Cleveland, Ohio-based aftermarket automotive transmission parts distributor Transtar Holding Co. The outlook is stable. At the same time, S&P assigned an issue-level rating of 'BB-' and a recovery rating of '2' on the Company's $290 million senior secured credit facilities (consisting of a $50 million revolving credit facility and a $240 million first-lien term loan). S&P also assigned an issue-level rating of 'B-' and a recovery rating of '6' on the $135 million second-lien term loan. "The rating on Transtar reflects S&P's expectation that the Company will maintain its operating performance in line with its recent history, including strong margins that exceed those of other rated aftermarket distribution companies," said Standard & Poor's credit analyst Robert Schulz. S&P expect the Company's key credit measures to improve slightly during the next year, including adjusted debt to EBITDA declining to under 5.5x in 2011 and toward 5.0x in 2012. S&P view Transtar's financial risk profile as aggressive, based on adjusted debt to EBITDA of about 5.5x. But the Company also has good free cash flow prospects because of low capital spending. In S&P's view, possible future returns of capital to shareholders by the private equity sponsor could constrain significant debt reduction. S&P view the business risk profile as weak, based on strong margins and the Company's position as a leading distributor in the fairly stable but fragmented and competitive transmission parts aftermarket. In S&P's view, the most significant variable in Transtar's credit profile in the near term will be the extent of the new owner's focus on debt reduction, as the Company has historically generated free discretionary cash flow. Transtar reports that it is the largest light-vehicle aftermarket transmission parts distributor in the U.S., although S&P believes this is a very fragmented industry. Aftermarket demand for transmission parts has historically been relatively stable, fluctuating less than demand for original equipment vehicles. The Company also competes in the auto body repair supply segment, producing most of its products at its own manufacturing operations, and gross margins in this business are attractive. Competitors in this segment include some large companies with greater resources than Transtar has. The stable outlook reflects S&P's belief that Transtar can maintain its strong EBITDA margins and positive, meaningful free operating cash flow in the 12 months ahead such that adjusted debt to EBITDA will decline to under 5.5x during 2011 and will decline further in 2012. S&P estimate that this would require revenue growth in 2011 of at least 2.5% and maintenance of historical profitability and capital spending levels. S&P believe economic sluggishness could keep organic sales growth below historical standards in 2011. S&P could lower the rating if free operating cash flow generation turns negative or if S&P believe debt to EBITDA, including S&P's adjustments, will not decline from current levels. For example, S&P estimates that adjusted debt to EBITDA could rise to 6x during the next year if Transtar's gross margins fall by about 250 basis points and revenue growth is limited. S&P considers an upgrade unlikely during the next year, based on S&P's current assessment of business and financial risks and Transtar's ownership by a financial sponsor, which S&P believe means that financial policies will remain aggressive. TRIAD CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Triad Construction Services, Inc P.O. Box 6379 High Point, NC 27262 Bankruptcy Case No.: 11-10113 Chapter 11 Petition Date: January 27, 2011 Court: United States Bankruptcy Court Middle District of North Carolina (Greensboro) Debtor's Counsel: William P. Miller, Esq ROBERSON HAWORTH & REESE, PLLC P.O. Box 1550 High Point, NC 27261 Tel: (336) 889-8733 Fax: (336) 885-1280 E-mail: bmiller@rhrlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ncmb11-10113.pdf The petition was signed by Richard C. Phillips, president. TRIBUNE CO: Committee Wants Zell Claims Objection Denied -------------------------------------------------------- As reported in the December 14, 2010 edition of the Troubled Company Reporter, the Official Committee of Unsecured Creditors in Tribune Co.'s cases asks the Bankruptcy Court to confirm that its October 27, 2010 order granting the panel standing on behalf of the Debtors' estates to commence, prosecute and settle claims and counterclaims arising out of or in connection with the Debtors' 2007 leveraged buyout transaction encompasses all claims set forth in the Committee's Amended Complaints in Adversary Proceeding No. 10-53963. By order dated October 27, 2010, the Court granted the Committee leave, standing and authority to commence and prosecute the claims of the Debtors' estates. In response, Samuel Zell and EGI-TRB LLC insists that the alleged claims against them, which the Examiner found unlikely to succeed, are not colorable and that it would not benefit the estates to pursue them. Mr. Zell and EGI-TRB request that the Court continue to preserve all their rights as defendants, including the right to contest these issues in future proceedings. The Creditors Committee now asks Judge Kevin Carey of the U.S. Bankruptcy Court for the District of Delaware to deny the limited objection of Sam Zell and EGI-TRB LLC because: (a) the Standing Order definitively resolved the issues raised by the Limited Objection; and (b) even if the Zell Parties had timely moved to reconsider, there can be no doubt that the Court properly granted the Committee standing to commence and prosecute the claims against the Zell Parties. The Court's October 27, 2010 order granted the Committee's original standing motions and conferred standing on the Committee to commence and prosecute all the claims in the amended complaints. The Committee filed its motion to confirm standing out of abundance of caution to avoid any doubt that its standing to commence and prosecute the leveraged buy-out actions extends to all of the claims in the Amended Complaints. In the Limited Objection, the Zell Parties suggest that the Court should reserve judgment on whether the Committee has standing to prosecute the claims in the Amended Complaint against them. The Zell Parties seek future evaluation of whether those claims are colorable and would benefit the Debtors' estates. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, special counsel to the Committee, asserts that the Zell Parties orchestrated the calamitous LBO that rendered Tribune insolvent or so close to insolvency that the Debtors petitioned for bankruptcy within a year of the LBO's consummation. The claims against the Zell Parties arising out of their conduct in connection with the LBO have the potential to yield significant recoveries for the Debtors' estates, and the marginal expense of pursuing those claims as part of the Third Party Action that implicates all aspects of the LBO is far outweighed by the potential benefits, Mr. Macauley relates. The fact that the Examiner opined that some of the claims against the Zell Parties were subject to defenses and might ultimately be defeated does nothing to call into question this Court's grant of standing, Mr. Macauley argues. Aurelius Capital Management, LP, filed with the Court a joinder to the Committee's Motion. Zell Parties Supplement Response The Zell Parties sought and obtained the Court's order authorizing them to file a supplement in further support of their limited objection to the Committee's Standing Motion. In a supplemental response, the Zell Parties asked the Court to declare that the Standing Order and any order resulting from the Committee's Motion to Verify does not preclusively determine the issue of standing for purposes of adversary proceedings against Mr. Zell and EGI-TRB. Counsel to Mr. Zell and EGI-TRB, Allan M. Root, Esq., at Blank Rome LLP, in Wilmington, Delaware, contends that the Creditors' Committee is wrong to believe that the Court has held, or should hold, that Mr. Zell and EGI-TRB are precluded from ever raising a challenge to the Creditors' Committee's standing to prosecute its alleged claims against them for these reasons: (i) standing is a jurisdictional matter and may be examined or reexamined at any time; (ii) the October 27 Order with respect to standing in an adversary proceeding is interlocutory in nature and may be withdrawn or revised at any time; (iii) where an issue has been decided without a full adversarial presentation, as the Creditors' Committee's initial motion for standing was here, that decision does not have preclusive effect in later proceedings, whether as collateral estoppel, law of the case, or any other doctrine; and (iv) as the Court noted at a December 15, 2010 hearing, these matters are before the Court now because the Creditors' Committee filed a motion for clarification of the October 27 Order concerning the scope. Having asked the Court to revisit the scope and meaning of that Order, the Creditors' Committee cannot fairly contend that other parties should be precluded from objecting, Mr. Root maintains. In the meantime and as the parties and the Court discussed at the December 15 hearing, a tolling agreement and a dismissal without prejudice would preserve all parties' rights until a decision on standing is made, Mr. Zell and EGI-TRB propose. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Mediator Files Report; Bridge Lenders Accept Plan ------------------------------------------------------------- Judge Kevin Gross, the Court-appointed mediator in the bankruptcy case of Tribune Company and its debtor affiliates, filed his Third Mediator's Report on January 28, 2011. Judge Gross relates in the report that the continuing settlement discussions have resulted in the Bridge Lender Group's acceptance of the plan of reorganization proposed by the Debtors, the Official Committee of Unsecured Creditors, Oaktree Capital Management, L.P., Angelo Gordon & Co., L.P., and JPMorgan Chase Bank, N.A. The Bridge Lender Group is composed of King Street Acquisition Company, LLC, King Street Capital, LLP and Marathon Asset Management, L.P. The Bridge Loan Settlement provides, among other things, that on the Effective Date of the Plan, the Bridge Lenders will receive their pro rata share of $64.5 million in cash. On the Effective Date, the Bridge Lenders will also receive their pro rata share of the LBO Lenders' share of the Litigation Trust Interest and Creditors' Trust Interests. The Bridge Loan Settlement further provides that the Plan will be amended to reflect that the Bridge Arrangers (JPMorgan, Citibank, Merrill Lynch and Bank of America) and their affiliates will have the option to either: (a) receive their pro rata shares of the $64.5 million to be distributed to the Bridge Lenders and receive no additional releases from the other Bridge Lenders; or (b) exchange mutual releases with the other Bridge Lenders and the current Bridge Loan Agent, in form and substance reasonably satisfactory to the Arrangers, providing for the unconditional release of any and all claims related to Tribune, the leveraged buyout transactions, the financings related thereto and the Chapter 11 proceedings in lieu of receiving: (i) their pro rata share of the $64.5 million cash distribution on account of their Bridge Loan Claims held for their own accounts; and (ii) their pro rata share of the Litigation Trust Interests and Creditors' Trust Interests as provided under the Plan on account of their Bridge Loan Claims held for their own accounts. As a condition to receipt of the treatment, the group of Bridge Lenders will (a) support the Plan and take no further actions inconsistent with confirmation of the Plan and (b) vote all Bridge Loan Claims held by them in their capacities as Holders of Bridge Loan Claims to accept the Plan. The Proponents of the Plan will file an amendment to the Plan. The Plan amendment will make clear that: (i) the Bridge Lenders and the current Bridge Loan Agent will receive all the benefit of being "Released Parties" as that terms is defined in the Plan and (ii) no Arranger will receive a third-party release by any of the Bridge Lenders or the Current Bridge Loan Agent unless that Arranger exercises the Bridge Release Option. Upon the filing of the Plan amendment, the Bridge Plan Proponents will withdraw their proposed plan of reorganization and all of their discovery requests issued to the Debtors and the other Plan proponents. The Debtors and the other Plan Proponents will also withdraw discovery requests issued to any of the Bridge Plan Proponents, any other Bridge Lender, the current Bridge Loan Agent or any of their respective professionals. A full-text copy of the Bridge Loan Settlement Term Sheet is available for free at: http://bankrupt.com/misc/Tribune_BridgeTermSheet.pdf About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Says Cash Flow in 2010 Up by $140MM From 2009 --------------------------------------------------------- Tribune Company announced financial highlights for 2010. "The past year showed substantial improvement over 2009," said Chandler Bigelow, Tribune's chief financial officer. "Consolidated operating cash flow in 2010 was approximately $635 million, an increase of more than $140 million compared to full-year 2009." Thanks to strong performance across its local television station group, the expansion of local programming and robust political advertising in the fourth quarter, the company's broadcasting division had an exceptional year in 2010. On the publishing side, despite a difficult environment for print advertising, the rate of decline in both revenue and operating cash flow slowed significantly compared to 2009. At Tribune Publishing's two largest business units, the Los Angeles Times and Chicago Tribune, 2010 full-year operating cash flow was essentially unchanged compared to the previous year. Other full-year financial highlights for 2010 include: * Consolidated revenue increased one percent compared to 2009. * Consolidated operating cash flow margin increased more than four percentage points, to almost 20%, compared to the previous year. * Consolidated cash operating expenses decreased four percent compared to 2009. Tribune's financial results for 2010 are due, in large part, to the great work of thousands of employees, who continue transforming the company from a collection of newspapers and broadcast stations to a media company with innovative products providing news, information and entertainment across multiple platforms. The company said that 2011 will remain challenging due to reduced political advertising in broadcasting and continued pressure on print advertising, particularly in the national advertising category. Tribune filed its monthly operating report for December 2010 with the U.S. Bankruptcy Court for the District of Delaware. Tribune Company and its subsidiaries maintain their financial records in accordance with generally accepted accounting principles. The Company uses cash operating expenses and operating cash flow to evaluate internal performance. "Cash operating expenses" are defined as operating expenses before depreciation and amortization, write-downs of intangible assets, stock-based compensation, certain special items including severance, non- operating items, and reorganization costs. "Operating cash flow" is defined as earnings before interest and dividend income, interest expense, equity income and losses, depreciation and amortization, write-downs of intangible assets, stock-based compensation, certain special items including severance, non- operating items, and reorganization costs. Cash operating expenses and operating cash flow are not measures of financial performance under GAAP and should not be considered as a substitute for measures of financial performance prepared in accordance with GAAP. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: LA Times Settlement with Liberman Approved ------------------------------------------------------ Tribune Co. and its units sought and obtained the Bankruptcy Court's order authorizing Debtors Los Angeles Times Communications LLC and Tribune Company to enter into a Settlement Agreement and Mutual General Release with George Liberman Enterprises, Inc. Pursuant to the Agreement, the parties resolve their various claims against each other, namely, a $118,128 claim asserted by LATC against Liberman and two proofs of claim asserted by Liberman against the Settling Debtors in the face amount of $1 million. On November 10, 2008, Liberman filed a complaint in the Superior Court of California, County of Los Angeles, Central District, against Los Angeles Times Communications, LLC, et al. Pursuant to the complaint, Liberman brought numerous contract-related causes of action against LATC, Tribune Corporation and an individual employee of LATC for alleged breaches of an oral contract governing the parties' pre-complaint business relationship. In summary, the Complaint alleged that LATC's practice of placing certain of Liberman's advertisements as inserts in the Fin de Semana newspaper was a violation of the parties' pre-complaint business agreement. Liberman has cited this alleged violation as a basis for failing to pay for at least $118,128 worth of advertising services provided to Liberman by LATC. In the Complaint, Liberman sought compensatory damages, punitive damages, interest, costs of suit and any further relief the State Court deemed proper. LATC and the other defendants in the State Court Action denied all allegations raised in the Complaint. Liberman, on May 19, 2009, filed Claim Nos. 2974 and 2975 against Tribune Company and LATC, each for $1 million based on all allegations raised in the Complaint. The Debtors find no validity to the assertion that any amounts claimed in the Proofs of Claims could be secured. In recent months, the parties have exchanged views regarding the Complaint and the parties' position with respect thereto. As a result of those exchanges, including multiple back-and-forth proposals to settle the State Court Action and LATC's claim against Liberman for unpaid services, the parties have agreed to a mutual compromise. The Settlement Agreement and Mutual General Release provides, among other things, that: (a) within one year of execution of the Agreement, The Times will, at no cost to Liberman, provide Liberman with 24-1/4 page full run of print color advertisements in the Los Angeles Times's Home Section, which runs on Saturdays; (b) promptly, upon approval of the Agreement by the Bankruptcy Court, Liberman will dismiss the Los Angeles Superior Court Action with prejudice; (c) upon approval of the Agreement, the Proofs of Claims filed by Liberman in the Bankruptcy Action will be deemed withdrawn, and that Liberman agrees to file no other or further proofs of claims on account of the claims released by the Agreement; and (d) the parties will bear their own costs and attorneys' fees incurred in connection with the Los Angeles Superior Court Action, the Bankruptcy Action and the Agreement. A full-text copy of the Agreement is available for fee at: http://bankrupt.com/misc/Tribune_LibermanAgmt.pdf Prior to the entry of the Court's order, the Debtors certified to the Court that no objection was filed as to the Motion. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRICO MARINE: Lenders File Emergency Motion Seeking Asset Sale -------------------------------------------------------------- BankruptcyData.com reports that Trico Marine Services' D.I.P. lenders filed an emergency motion with the U.S. Bankruptcy Court seeking approval of an order that (a) terminates or modifies the Debtor's use of cash collateral (b) schedules a global auction for the remaining unsold assets and (c) lifts agreed injunctions against exercising remedies against non-debtors. BData relates that the lenders indicated in the motion that Trico still owed $7.7 million in principal, interest and fees and more than $2.4 million in attorneys' fees. The motion asked that that Trico should only have access to their cash collateral for two more weeks to allow the global sale to be completed. In the motion the lenders stated "... As a result, the debtors have been allowed to fail to provide the secured lenders with the benefit of their bargain, namely protections that were approved by this court and endorsed by the debtors". The lenders requested a January 31, 2011 hearing on the matter. Emergency Bonuses Questioned Meanwhile, U.S. Trustee Roberta A. DeAngelis said in a court filing that Trico Marine's "emergency" request to pay bonuses to 23 managers, including several that work for nonbankrupt subsidiaries, should be closely questioned and should not be approved on a shortened timeframe, American Bankruptcy Institute reports. About Trico Marine Headquartered in Texas, Trico Marine Services, Inc. -- http://www.tricomarine.com/-- provides subsea services, subsea trenching and protection services, and towing and supply vessels. Trico filed for Chapter 11 protection on August 25, 2010 (Bankr. D. Del. Case No. 10-12653). John E. Mitchell, Esq., Angela B. Degeyter, Esq., and Harry A. Perrin, Esq., at Vinson & Elkins LLP, assist the Debtor in its restructuring effort. The Debtor disclosed US$30,562,681 in assets and US$353,606,467 in liabilities as of the Petition Date. Affiliates Trico Marine Assets, Inc. (Bankr. D. Del. Case No. 10-12648), Trico Marine Operators, Inc. (Case No. 10-12649), Trico Marine International, Inc. (Case No. 10-12650), Trico Marine Cayman, L.P. (Case No. 10-12651), and Trico Holdco, LLC (Case No. 10-12652) filed separate Chapter 11 petitions. Cahill Gordon & Reindell LLP is the Debtors' special counsel. Alix Partners Services, LLC, is the Debtors' chief restructuring officer. Epiq Bankruptcy Solutions is the Debtors' claims and notice agent. Postlethwaite & Netterville serves as the Debtors' accountant and Ernst & Young LLP serves as tax advisors. Pricewaterhousecoopers LLC provides the independent accountants and tax advisors for the Debtors. Aside from the Cayman Islands holding company, Trico's foreign subsidiaries were not included in the filing and will not be subject to the requirements of the U.S. Bankruptcy Code. The Official Committee of Unsecured Creditors tapped Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski, Stang, Ziehl & Jones LLP, in Wilmington, Delaware, and Andrew K. Glenn, Esq., David J. Mark, Esq., and Daniel A. Fliman, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, as counsel. TRICO MARINE: PACC Offshore Withdraws Services Motion ----------------------------------------------------- BankruptcyData.com reports that PACC Offshore Services Holdings withdrew from the U.S. Bankruptcy Court its motions for orders directing Trico Marine Services to return $14.8 million in escrowed funds and enforcing the sale order related to the sale of the Debtors' Mystic Vessel. As previously reported, because repairs were made to the vessel, Trico was unable to close the sale by the Dec. 30, 2010 deadline. According to a group of Trico lenders who filed an objection to the motion, the closing deadline was never discussed at the sale hearing or auction. No reason was given for the withdrawal. About Trico Marine Headquartered in Texas, Trico Marine Services, Inc. -- http://www.tricomarine.com/-- provides subsea services, subsea trenching and protection services, and towing and supply vessels. Trico filed for Chapter 11 protection on August 25, 2010 (Bankr. D. Del. Case No. 10-12653). John E. Mitchell, Esq., Angela B. Degeyter, Esq., and Harry A. Perrin, Esq., at Vinson & Elkins LLP, assist the Debtor in its restructuring effort. The Debtor disclosed US$30,562,681 in assets and US$353,606,467 in liabilities as of the Petition Date. Affiliates Trico Marine Assets, Inc. (Bankr. D. Del. Case No. 10-12648), Trico Marine Operators, Inc. (Case No. 10-12649), Trico Marine International, Inc. (Case No. 10-12650), Trico Marine Cayman, L.P. (Case No. 10-12651), and Trico Holdco, LLC (Case No. 10-12652) filed separate Chapter 11 petitions. Cahill Gordon & Reindell LLP is the Debtors' special counsel. Alix Partners Services, LLC, is the Debtors' chief restructuring officer. Epiq Bankruptcy Solutions is the Debtors' claims and notice agent. Postlethwaite & Netterville serves as the Debtors' accountant and Ernst & Young LLP serves as tax advisors. Pricewaterhousecoopers LLC provides the independent accountants and tax advisors for the Debtors. Aside from the Cayman Islands holding company, Trico's foreign subsidiaries were not included in the filing and will not be subject to the requirements of the U.S. Bankruptcy Code. The Official Committee of Unsecured Creditors tapped Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski, Stang, Ziehl & Jones LLP, in Wilmington, Delaware, and Andrew K. Glenn, Esq., David J. Mark, Esq., and Daniel A. Fliman, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, as counsel. TRONOX INC: Submits Settlement Offer Re: "B" Stock Deregistration ----------------------------------------------------------------- In a regulatory filing Wednesday, Tronox Incorporated discloses that on January 18, 2011, the U.S. Bankruptcy Court for the Southern District of New York granted it permission to submit an offer of settlement to the Securities and Exchange Commission regarding the deregistration of the Company's Class B Common Stock, par value $0.01 per share. The offer of settlement has been submitted to the Commission, and the Company expects that the Commission will consider the offer in the near future. If the offer is accepted, the Commission will issue an Order pursuant to Section 12(j) of the Securities Exchange Act of 1934 (the "Exchange Act"). When the Order is issued by the Commission, no member of a national securities exchange, broker, or dealer may make use of the mails or any means or instrumentality of interstate commerce to effect any transaction in, or to induce the purchase or sale of, the Company's Class B Common Stock. As the Company has previously disclosed, the Company has been unable to prepare financial statements as explained in its Current Report on Form 8-K filed with the Commission on May 5, 2009. As a result, the Company has not filed any quarterly and annual reports required by Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder since the period ended September 30, 2008. The Class B Common Stock is expected to be canceled upon the emergence by the Debtors from their Chapter 11 Cases expected to occur on or about January 31, 2011. The Debtors' emergence from Chapter 11 is subject to satisfying the conditions to effectiveness contemplated under the Plan including entering into a new credit facility. As reported in the Troubled Company Reporter on January 11, 2011, Tronox filed with the U.S. Bankruptcy Court a motion to authorize Tronox to submit an offer of settlement to the Securities and Exchange Commission to deregister Tronox Incorporated's Class B common stock. According to the motion, the Company received a letter on May 21, 2010, from the Office of Enforcement Liaison in the Commission's Division of Corporate Finance alleging that the Company had not filed any periodic reports with the Commission since the period ended September 30, 2008 and that the Company needed to "become current with its filing obligations within 15 days or face administrative proceedings under section 12(j) of the Exchange Act to revoke the Company's registration of securities." Furthermore, the motion said that "because it is anticipated that the SEC's Consent Order will not take effect until after the effective date of the Plan, Tronox does not believe the holders of the Company's Class B common shares will be impacted by the relief sought herein." About Tronox Inc. Tronox Inc., aka New-Co Chemical, Inc., and 14 other affiliates filed for Chapter 11 protection on January 13, 2009 (Bankr. S.D.N.Y. Case No. 09-10156). The case is before Hon. Allan L. Gropper. Richard M. Cieri, Esq., Jonathan S. Henes, Esq., and Colin M. Adams, Esq., at Kirkland & Ellis LLP in New York, represent the Debtors. The Debtors also tapped Togut, Segal & Segal LLP as conflicts counsel; Rothschild Inc. as investment bankers; Alvarez & Marsal North America LLC, as restructuring consultants; and Kurtzman Carson Consultants serves as notice and claims agent. An official committee of unsecured creditors and an official committee of equity security holders were appointed in the cases. The Creditors Committee retained Paul, Weiss, Rifkind, Wharton & Garrison LLP as counsel. Until September 30, 2008, Tronox was publicly traded on the New York Stock Exchange under the symbols TRX and TRX.B. Since then, Tronox has traded on the Over the Counter Bulletin Board under the symbols TROX.A.PK and TROX.B.PK. As of December 31, 2008, Tronox had 19,107,367 outstanding shares of class A common stock and 22,889,431 outstanding shares of class B common stock. On November 17, 2010, the Bankruptcy Court confirmed the Debtors' First Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code, dated November 5, 2010. Under the Plan, Tronox will reorganize around its existing operating businesses, including its facilities at Oklahoma City, Oklahoma; Hamilton, Mississippi; Henderson, Nevada; Botlek, The Netherlands and Kwinana, Australia. ULTIMATE ACQUISITION: Asks for Court's Nod to Use Cash Collateral ----------------------------------------------------------------- Ultimate Acquisition Partners, LP, et al., seek authority from the U.S. Bankruptcy Court for the District of Delaware to use the cash collateral until February 25, 2011. In September 2005, General Electric Capital Corporation, as the Prepetition Agent and Prepetition Lender, and the Debtors entered into a certain Loan and Security Agreement, as amended, modified and supplemented on January 5, 2006, April 18, 2006, November 4, 2007, and May 23, 2008. The loan and security agreement was amended again in July 2010 at which time CC Retail, LLC, among others, became a party to the loan and security agreement. Pursuant to the loan and security agreement, the Debtors have a $150 million commitment for a revolving line of credit. The Debtors also have the availability to request the issuance of letters of credit in an amount up to $10 million. The loan and security agreement has a loan maturity date of June 23, 2011. As of the Petition Date, the Debtors have borrowed approximately $64.80 million either on the revolver or through the issuance of outstanding letters of credit. Mark T. Hurford, Esq., Campbell & Levine, LLC, explains that the Debtors need the money to fund their Chapter 11 case, pay suppliers and other parties. The Debtors will use the collateral pursuant to a weekly budget, a copy of which is available for free at http://bankrupt.com/misc/ULTIMATE_ACQUISITION_budget.pdf In exchange for using the cash collateral, the Debtors propose to grant the Lender additional and replacement continuing valid, binding, enforceable, non-avoidable, and automatically perfected postpetition security interests in and liens on any and all presently owned and hereafter acquired personal property, real property and all other assets of the Debtors, to the same extent, validity and priority as they existed on the Petition Date. About Ultimate Acquisition Ultimate Acquisition Partners LP and CC Retail, LLC, which own the U.S. consumer electronics store chain Ultimate Electronics, filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 11-10245) on January 26, 2011. Ultimate Acquisition estimated assets and liabilities between $100 million and $500 million. Ultimate Acquisition Partners LP and CC Retail, LLC are specialty retailers of high-end entertainment and consumer electronics with 46 stores in over a dozen states, primarily in the mid-west and western United states. Of the 46 stores, 35 are operated by UAP and 11 are operated by CC Retail. All are operated under the name "Ultimate Electronics". UAP and CC Retail have more than 1,500 full-time and part-time employees. Kathleen Campbell Davis, Esq., Mark T. Hurford, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine LLC, serve as the Debtor's bankruptcy counsel. Kurtzman Carson Consultants LLC is the claims and notice agent. ULTIMATE ACQUISITION: Taps Kurtzman Carson as Claims Agent ---------------------------------------------------------- Ultimate Acquisition Partners, LP, et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Kurtzman Carson Consultants, LLC, as claims, noticing and balloting agent. KCC will, among other things: (a) prepare and serve required notices in the Chapter 11 cases; (b) revise the creditor matrix after the objection period expires; (c) record any order entered by the Court which may affect a claim by making a notation on the claims register; and (d) provide balloting and solicitation services, including preparing ballots, producing personalized ballots and tabulating creditor ballots on a daily basis. KCC will charge the Debtors for its services, expenses and supplies at the rates or prices set by KCC and in effect as of the date of KCC's service agreement with the Debtors in accordance with the KCC fee structure. Prior to the filing of the Debtors' Chapter 11 cases, the Debtors' paid KCC a retainer of $15,000. A copy of the service agreement is available for free at: http://bankrupt.com/misc/ULTIMATE_ACQUISITION_kccservicespact.pdf Albert Kass, Vice President of Corporate Restructuring Services of KCC, assures the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. Thorton, Colorado-based Ultimate Acquisition Partners, LP, aka Ultimate Electronics, filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. D. Del. Case No. 11-10245). Kathleen Campbell Davis, Esq., Mark T. Hurford, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine LLC, serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $100 million to $500 million. Affiliates Ultimate Acquisition Partners, LP, and CC Retail, LLC, filed a separate Chapter 11 petition. ULTIMATE ACQUISITION: Must Wait to Pay Vendors, Judge Says ---------------------------------------------------------- Bankruptcy Law360 reports that a bankruptcy judge on Friday refused to authorize Ultimate Acquisition Partners LP to pay $10 million to essential vendors, saying the electronics retailer was making promises it couldn't keep before it can guarantee access to more cash collateral. Judge Mary F. Walrath signed off on a slew of first-day motions for the company at a hearing in the U.S. Bankruptcy Court for the District of Delaware. About Ultimate Acquisition Ultimate Acquisition Partners LP and CC Retail, LLC, which own the U.S. consumer electronics store chain Ultimate Electronics, filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 11-10245) on January 26, 2011. Ultimate Acquisition estimated assets and liabilities between $100 million and $500 million. Ultimate Acquisition Partners LP and CC Retail, LLC are specialty retailers of high-end entertainment and consumer electronics with 46 stores in over a dozen states, primarily in the mid-west and western United states. Of the 46 stores, 35 are operated by UAP and 11 are operated by CC Retail. All are operated under the name "Ultimate Electronics". UAP and CC Retail have more than 1,500 full-time and part-time employees. Kathleen Campbell Davis, Esq., Mark T. Hurford, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine LLC, serve as the Debtor's bankruptcy counsel. Kurtzman Carson Consultants LLC is the claims and notice agent. UNIFUND ASSURANCE: AM Best Upgrades Issuer Credit Rating to 'bb+' ----------------------------------------------------------------- A.M. Best Co. has upgraded the issuer credit rating (ICR) to "bb+" from "bb" and affirmed the financial strength rating (FSR) of B (Fair) of Unifund Assurance Company (Unifund) (St. John's, Canada). In addition, A.M. Best has affirmed the FSR of A (Excellent) and ICRs of "a" of Royal & Sun Alliance Insurance Company of Canada (RSA Canada) (Toronto, Canada), Quebec Assurance Company (Quebec Assurance) (Montreal, Canada) and Western Assurance Company (Western Assurance) (Toronto, Canada) (together known as RSA Canadian Property/Casualty Pool [pool]). Concurrently, A.M. Best has affirmed the FSR of B+ (Good) and ICR of "bbb-" of Ascentus Insurance Ltd. (Ascentus) (Toronto, Canada) and the FSR of B (Fair) and ICR of "bb+" of Canadian Northern Shield Insurance Company (CNS) (Vancouver, Canada). All companies are subsidiaries of Roins Financial Services Limited, the Canadian holding company of RSA Insurance Group plc (RSA) [LSE: RSA] (United Kingdom). Collectively, all of the insurance entities in Canada are referred to as the RSA Group of Canada. The outlook for all ratings is stable. The rating actions on the pool reflect A.M. Best's viewpoint that it maintains a strong risk-adjusted capitalization, solid investment income and sound reserve development. The pool has produced solid underwriting results, which have consistently increased equity over the last five years prior to the stockholder dividends. Collectively, the pool provides commercial property/casualty coverage as well as personal and specialty coverages throughout Canada. The companies in the pool maintain a presence in all of the Canadian provinces and distribute their product range through multiple distribution channels, including a large independent broker network. The ratings also reflect the pool's strong integration with RSA through its systems and procedures and its significant contribution to RSA's overall profit. The ratings of Unifund acknowledge its improved risk-adjusted capitalization, consistent operating performance and favorable reserve development. The ratings also reflect Unifund's strategic role within the Johnson Corporation, a major intermediate holding company within the RSA Group of Canada. Historically, Unifund has been a growth vehicle for the overall Canadian organization. In prior years, Unifund's rapid premium expansion outpaced equity growth, which resulted in elevated underwriting leverage measures and a sharp decline in overall risk-adjusted capitalization. More recently, the company's premium levels have stabilized, equity has increased and overall risk-adjusted capitalization has improved. However, Unifund remains highly leveraged as net and gross underwriting leverage ratios exceed the industry composite. The company primarily is a writer of personal lines insurance for associations and groups throughout Ontario, Alberta, Newfoundland and Labrador and Nova Scotia. The rating actions also reflect Unifund's strong integration within RSA Group of Canada through its systems and procedures and its significant contribution to RSA's overall profit. Going forward, A.M. Best remains somewhat concerned about softening market conditions, fierce competition and the long-term benefits of regulated product reforms to auto insurance industry in the core operating territories of Ontario and Alberta. As a result, the members of the RSA Group of Canada may be challenged to maintain current levels of profitability. The ratings of Ascentus are based on its solid level of capitalization, which supports its underwriting and investment risk. The level of the company's premium volume has sharply declined in recent years, since all private passenger auto and personal property businesses were renewed into RSA Canada. The company now concentrates on marine business throughout Canada. The ratings of CNS recognize its elevated underwriting leverage, high underwriting expenses and adequate operating performance. CNS provides RSA Group of Canada improved geographic diversity, increased distribution and growth opportunities within British Columbia, where a majority of CNS' premiums are written. CNS is fully integrated into RSA Group of Canada's operations and continues to benefit from the implicit and explicit support it receives as a member of RSA Group of Canada. UNION FOR TRADITIONAL JUDAISM: Emerges from Bankruptcy Protection ----------------------------------------------------------------- Warren Boronson at The Jewish Standard reports that the Union for Traditional Judaism and the Institute of Traditional Judaism have emerged from bankruptcy protection. Rabbi Ronald D. Price, executive vice president of the UTJ and dean of the institute, declared that all of the Debtors' creditors will get 100 cents of on the dollar. Union for Traditional Judaism, a not-for-profit organization that trains and places rabbis, along with the Institute of Traditional Judaism Inc., filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 10-22958) on May 14 in White Plains, New York. The petition says assets and debt are both more than $1 million. UNITY MEDIA: Starts Down Path to Liquidation in Bankruptcy Court ---------------------------------------------------------------- Dow Jones' DBR Small Cap reports that Unity Media Inc. sought Chapter 7 bankruptcy liquidation in Manhattan. The report relates that the business filed it bankruptcy petition, opting to seek shelter under the arm of the Bankruptcy Code that leads companies through liquidation. According to DBR, Brian J. Hufnagel, an attorney representing Unity Media in the case, declined to comment. The report relates that Mr, Hufnagel's with Forchelli, Curto, Deegan, Schwartz, Mineo, Cohn & Terrana in Uniondale, N.Y. According to Unity Media's Web site, it's the "largest African American owned and operated, full service media independent," providing media planning and buying services to companies and advertising agencies. "We strive to link great creative with innovative media approaches so as to produce measurable gains in sales, awareness, attitude changes, or market share growth," the company said on its Web Site. Unity Media Inc. is a 20-year-old media planning and buying company. UNIVERSAL BUILDING: Secured Lender Won't Provide Exit Loan ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports the secured lender for Universal Building Products Inc. won't provide the loan necessary to confirm and implement the Debtor's Chapter 11 Plan of Liquidation. A hearing for approval of the disclosure statement was scheduled for January 31. Universal Building sold its construction products business to Oaktree Capital Management LP after the Chapter 11 filing in August. Oaktree purchased the secured debt. Oaktree used $25 million of the $40 million secured claim to buy the remaining businesses in a sale approved by the bankruptcy court. Oaktree is still owed about $21 million, including $6 million loaned to finance the Chapter 11 case. According to Mr. Rochelle, while Oaktree opposes the plan, the Debtor and the official committee of unsecured creditors in the case believe the lender's approval isn't necessary because the rest of Oaktree's collateral will be turned over in satisfaction of the remaining secured claim. The plan proponents said they believe that an agreement binds Oaktree to supporting the plan anyway. Mr. Rochelle notes that even if the plan could be crammed down on Oaktree, the proposed disclosure statement explains how Oaktree takes the position that it's no longer obligated to make an advance to cover administrative and priority claims. Without new funds, the plan can't be confirmed, the disclosure statement says. The Committee and UBP take the position that prior agreements require Oaktree to advance the necessary money. About Universal Building Westminster, California-based Universal Building Products, Inc., dba UBP, filed for Chapter 11 bankruptcy protection on August 3, 2010 (Bankr. D. Del. Case No. 10-12453). Mark Minuti, Esq., MaryJo Bellew, Esq., and Teresa K.D. Currier, Esq., at Saul Ewing LLP, assists the Debtor in its restructuring effort. UBP estimated $1 million to $10 million in assets and $10 million to $50 million in debts in its petition. The Debtor's affiliates Accubrace, Inc. (Bankr. D. Del. Case No. 10-12454), Don De Cristo Concrete Accessories, Inc. (Case No. 10-12455), Form-Co, Inc. (Case No. 10-12456), and Universal Form Clamp, Inc. (Case No. 10-12457), filed separate Chapter 11 petitions on August 4, 2010. Accubrace estimated $500,001 to $1 million in assets and $10 million to $50 million in debts. VALLEJO, CA: Settles Dispute With Nat'l Public Finance Guarantee ---------------------------------------------------------------- Jim Christie of Reuters reports that the city of Vallejo, California, and National Public Finance Guarantee Corp. have settled a claim stemming from the city's bankruptcy case. Details of the settlement were not immediately available. Reuters relates Lance Ignon, a spokesman for Armonk, New York- based National Public Finance Guarantee Corp, confirmed the settlement of the lawsuit over roughly $4.8 million in debt owed by Vallejo to bondholders insured by the company. According to Mr. Christie, the National Federation of Municipal Analysts, which had filed a friend-of-the-court brief in the dispute, said in a statement on Thursday that the agreement marks a "positive resolution for the municipal finance market." Reuters says Vallejo officials and the city's legal team could not be reached for comment. According to Reuters, at issue were vehicle license fees should Vallejo default on $4.8 million of its debt. The settlement confirms the fees will be tapped for payments if Vallejo fails to pay directly. The National Federation of Munipal Analysts is represented by Jeffry Davis, Esq., William Kannel, Esq., and Adrienne Walker, Esq., at Mintz Levin Cohn Ferris Glovsky and Popeo. About City of Vallejo Vallejo -- http://www.ci.vallejo.ca.us/-- is a city in Solano County, California in the United States. As of the 2000 census, the city had a total population of 116,760. It is located in the San Francisco Bay Area on the northern shore of San Pablo Bay. It was named for General Mariano Guadalupe Vallejo. Vallejo filed for protection under Chapter 9 of the U.S. Bankruptcy Code (Bankr. E.D. Calif. Case No. 08-26813) on May 23, 2008, after it was unable to persuade labor unions to accept salary concessions as the recession began cutting into local government tax collections nationwide. Marc A. Levinson, Esq., and Norman C. Hile, Esq., at Orrick, Herrington & Sutcliffe LLP in Sacramento, California, represent the City. The city estimated $500 million to $1 billion in assets and $100 million to $500 million in debts in its petition. According to Vallejo's comprehensive annual report for the year ended June 30, 2007, the city has $983 million in assets and $358 million in debts. VEBLEN EAST: Riverview Offers to Acquire Assets ----------------------------------------------- The Associated Press, citing The American News, reports Morris, Minn.-based Riverview LLP has made an offer to acquire the Veblen East and Veblen West dairies, two bankrupt dairies in northeast South Dakota. According to The AP, The American News said Riverview stated in its paperwork that it would continue operation of the dairies without interruption and keep all employees. As reported by the Troubled Company Reporter on January 25, 2011, the U.S. Bankruptcy Court for the District of South Dakota granted the motion of Chapter 11 trustee Lee Ann Pierce for the confirmation of her sale to Veblen East Dairy Acquisition, LLC, of all of Veblen East Dairy Limited Partnership and the bankruptcy estate's right, title, and interest in the dairy cattle and personal property and in the real property located in Marshall County, South Dakota, and the dairy facility located thereon, free and clear of all liens and other encumbrances, with any liens or other encumbrances transferred and attached to the sale proceeds in the order of their priority. Veblen East Dairy Acquisition, LLC, is the assignee of secured creditor, AgStar Financial Services, PCA, and FLCA. The credit bid was in the amount of $16,000,000.00 for the facility, including the real estate, plus $800.00 per cow. At the in-court auction on September 15, 2010, Vista Family Dairies, LLC, submitted the highest bid of $21,300,000. The bid was for $800.00 per head per cow and $17,300,000 for the facility. Whetstone Valley Dairy, LLC, submitted a backup bid which was approved by the Court. The Court also approved the Chapter 11 trustee's motion allowing for the sale of the assets to Veblen East Dairy Acquisition, in the event that neither Vista Family Dairies nor Whetstone Valley Dairy closed on the sale in a timely manner. Despite all conditions precedent to closing having been satisfied by the Chapter 11 trustee, and contrary to the terms of its bid at the in-court auction, Vista Family Dairies advised the Chapter 11 trustee it will not close on the sales transaction. On October 28, 2010, Whetstone Valley Dairy withdrew its back-up bid. About Veblen East Veblen, South Dakota-based Veblen East Dairy Limited Partnership operates a operates a "large calf-raising dairy business" in South Dakota. The Company filed for Chapter 11 bankruptcy protection on July 2, 2010 (Bankr. D. S.D. Case No. 10-10146). The Debtor estimated its assets and debts at $50 million to $100 million. Lee Ann Pierce was appointed Chapter 11 trustee. The Company's affiliate, Veblen West Dairy, LLP, filed a separate Chapter 11 petition on April 7, 2010 (Bankr. D. S.D. Case No. 10-10071). Veblen West operates a 4,000-cow milking facility. The two cases are not being jointly administered. About Veblen West Veblen West Dairy LLP, based in Veblen, S.D., operates a 4,000-cow milking facility. Veblen West sought Chapter 11 protection (Bankr. D. S.D. Case No. 10-10071) on April 7, 2010. Bryant D. Tchida, Esq., at Leonard, Street and Deinard, P.A., in Minneapolis, Minn., represents the Debtor. The Debtor disclosed $15.5 million in assets and $23.7 million in liabilities as of the Chapter 11 filing. The Dairy Dozen-Milnor, LLP, a related milking facility, also sought chapter 11 protection (Bankr. D. N.D. Case No. 10-30377) on April 7, 2010. The Dairy Dozen-Thief River Falls, LLP, another related entity, sought Chapter 11 protection (Bankr. D. Minn. Case No. 10-60438) on April 7, 2010, and that case has been converted to a Chapter 7 liquidation proceeding. Two additional related entities filed Chapter 11 petitions on July 2, 2010 -- Veblen East Dairy Limited Partnership (Bankr. D. S.D. Case No. 10-10146) and The Dairy Dozen-Veblen, LLP (Bankr. D. S.D. Case No. 10-10147) VEBLEN WEST: Riverview Offers to Acquire Assets ----------------------------------------------- The Associated Press, citing The American News, reports Morris, Minn.-based Riverview LLP has made an offer to acquire the Veblen East and Veblen West dairies, two bankrupt dairies in northeast South Dakota. According to The AP, The American News said Riverview stated in its paperwork that it would continue operation of the dairies without interruption and keep all employees. As reported by the Troubled Company Reporter on January 25, 2011, the U.S. Bankruptcy Court for the District of South Dakota granted the motion of Chapter 11 trustee Lee Ann Pierce for the confirmation of her sale to Veblen East Dairy Acquisition, LLC, of all of Veblen East Dairy Limited Partnership and the bankruptcy estate's right, title, and interest in the dairy cattle and personal property and in the real property located in Marshall County, South Dakota, and the dairy facility located thereon, free and clear of all liens and other encumbrances, with any liens or other encumbrances transferred and attached to the sale proceeds in the order of their priority. Veblen East Dairy Acquisition, LLC, is the assignee of secured creditor, AgStar Financial Services, PCA, and FLCA. The credit bid was in the amount of $16,000,000.00 for the facility, including the real estate, plus $800.00 per cow. At the in-court auction on September 15, 2010, Vista Family Dairies, LLC, submitted the highest bid of $21,300,000. The bid was for $800.00 per head per cow and $17,300,000 for the facility. Whetstone Valley Dairy, LLC, submitted a backup bid which was approved by the Court. The Court also approved the Chapter 11 trustee's motion allowing for the sale of the assets to Veblen East Dairy Acquisition, in the event that neither Vista Family Dairies nor Whetstone Valley Dairy closed on the sale in a timely manner. Despite all conditions precedent to closing having been satisfied by the Chapter 11 trustee, and contrary to the terms of its bid at the in-court auction, Vista Family Dairies advised the Chapter 11 trustee it will not close on the sales transaction. On October 28, 2010, Whetstone Valley Dairy withdrew its back-up bid. About Veblen East Veblen, South Dakota-based Veblen East Dairy Limited Partnership operates a operates a "large calf-raising dairy business" in South Dakota. The Company filed for Chapter 11 bankruptcy protection on July 2, 2010 (Bankr. D. S.D. Case No. 10-10146). The Debtor estimated its assets and debts at $50 million to $100 million. Lee Ann Pierce was appointed Chapter 11 trustee. The Company's affiliate, Veblen West Dairy, LLP, filed a separate Chapter 11 petition on April 7, 2010 (Bankr. D. S.D. Case No. 10-10071). Veblen West operates a 4,000-cow milking facility. The two cases are not being jointly administered. About Veblen West Veblen West Dairy LLP, based in Veblen, S.D., operates a 4,000-cow milking facility. Veblen West sought Chapter 11 protection (Bankr. D. S.D. Case No. 10-10071) on April 7, 2010. Bryant D. Tchida, Esq., at Leonard, Street and Deinard, P.A., in Minneapolis, Minn., represents the Debtor. The Debtor disclosed $15.5 million in assets and $23.7 million in liabilities as of the Chapter 11 filing. The Dairy Dozen-Milnor, LLP, a related milking facility, also sought chapter 11 protection (Bankr. D. N.D. Case No. 10-30377) on April 7, 2010. The Dairy Dozen-Thief River Falls, LLP, another related entity, sought Chapter 11 protection (Bankr. D. Minn. Case No. 10-60438) on April 7, 2010, and that case has been converted to a Chapter 7 liquidation proceeding. Two additional related entities filed Chapter 11 petitions on July 2, 2010 -- Veblen East Dairy Limited Partnership (Bankr. D. S.D. Case No. 10-10146) and The Dairy Dozen-Veblen, LLP (Bankr. D. S.D. Case No. 10-10147) VERMILION ENERGY: S&P Puts 'BB-' Rating on C$200MM Unsecured Notes ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'BB-' long-term corporate credit rating to Calgary, Alta.-based Vermilion Energy Inc. The outlook is stable. At the same time, Standard & Poor's assigned its 'BB-' issue-level rating and '4' recovery rating to the Company's proposed C$200 million senior unsecured notes. The '4' recovery rating indicates Standard & Poor's expectation for average recovery (30%- 50%) in the event of default. The Company also plans to decrease its C$675 million secured credit facility, which S&P does not rate, to C$635 million. Vermilion plans to use the proceeds largely to pay down the amount outstanding on its credit facility and cover related fees. "Although we believe there is some execution risk associated with the Company's strategic shift to emphasize organic, drill-bit related growth, rather than growth through acquisitions, its near- term development prospects in Western Canada (specifically its Cardium assets) and the longer term reserves and production growth prospects appear achievable," said Standard & Poor's credit analyst Michelle Dathorne. "The Company has had success achieving organic reserve replacement in 2010. The 'BB-' rating incorporates our assumption that Vermilion will replicate its 2010 reserve replacement success during our ratings forecast period. In addition, the Company's underleveraged balance sheet provides ample financial cushion to accommodate the capital spending required to proceed with its growth initiatives," Ms. Dathorne added. The ratings on Vermilion reflect S&P's opinion of its participation in the highly cyclical exploration and production segment of the oil and gas industry, its historical reliance on acquisitions and exploitation for reserve replacement and growth, relatively low proven reserves base and reserve life index, and its aggressive dividend policy. These factors, which hamper the Company's overall credit profile, are somewhat offset by what S&P views as the geographically diversified reserve base and moderate capital structure for the 'BB-' rating. Standard & Poor's expects the Company's near- and medium-term business strategy will focus on drill-bit-related reserve replacement and growth. Vermilion is a conventional oil and gas upstream Company, focused on the exploration and development of producing assets in Western Canada, France, the Netherlands, and Australia. The firm also has an 18.5% non-operated working interest in the Corrib offshore gas field in Ireland, with first production expected in by the end of 2012. Although crude oil and liquids accounts for approximately 65% of production, approximately 80% of production is tied to oil, because its Netherlands gas production is indexed to oil prices. The stable outlook reflects Standard & Poor's expectation that Vermilion will continue focusing on organic, drill-bit-related reserves and production growth, which should in turn improve its full-cycle economics. Although S&P expects the Company will generate negative near-term free cash flow after dividends while it shifts to the organic-growth strategy from an income trust acquisition-oriented approach, the outlook also incorporates S&P's view that Vermilion's financial metrics are strong for the 'BB-' rating, with some cushion to absorb the deterioration S&P expects in 2011 and 2012. Because S&P factors the Company's likely reserves and production growth into the ratings, there is little likelihood of an upgrade in this period. A negative rating action could occur if Vermilion cannot achieve the expected internal reserves and production growth and its production economics increase above current reported levels, which Standard & Poor's views as slightly weaker than those of its rating peer group. VERTRUE INC: S&P Holds 'B' Corp. Credit Rating; Outlook Negative ---------------------------------------------------------------- Standard & Poor's Rating Services revised its rating outlook on Norwalk, Conn.-based Vertrue Inc. to negative from stable. S&P also affirmed S&P's ratings on the Company, including the 'B' corporate credit rating. "The outlook revision and the 'B' corporate credit rating reflect our view that Vertrue's operating performance will continue to decline over the near-to-intermediate term," said Standard & Poor's credit analyst Chris Valentine. The Company has begun negotiations with its secured lenders for an amendment, which S&P believes it should be able to obtain over the near term. In S&P's opinion, the Company's good liquidity provides some financial flexibility to absorb higher interest expense and cover the likely cost of an amendment. "In our view, Vertrue has a vulnerable business risk profile," added Mr. Valentine, "because of its narrow business focus in adaptive marketing, EBITDA concentration, revenue vulnerability to economic weakness, and the need to replace lost revenue from regulatory changes." Positive rating factors that do not offset these negatives include the Company's good market position in niche consumer discount membership programs, good (albeit declining) cash flow generation, and its recurring revenue stream from renewals. S&P considers the financial risk profile aggressive because of its high de bt leverage and thin margin of compliance with financial covenants. WESTMORELAND COAL: S&P Junks Corp. Credit Rating; Outlook Stable ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned a preliminary 'CCC+' corporate credit rating to Colorado Springs, Colorado-based Westmoreland Coal Co. The rating outlook is stable. At the same time, S&P assigned a preliminary 'CCC' issue-level rating (one notch below the preliminary corporate credit rating) to Westmoreland's proposed $150 million senior secured notes due 2018. The preliminary recovery rating is '5', indicating S&P's expectation of modest (10%-30%) recovery for noteholders in the event of a payment default. The Company expects to use proceeds from the proposed notes to repay certain outstanding indebtedness, to pay accrued and unpaid dividends on outstanding shares of preferred stock, and for general corporate purposes. "The preliminary 'CCC+' corporate credit rating on S&Pstmoreland reflects the combination of what S&P consider to be its vulnerable business risk profile and highly leveraged financial risk profile," said Standard & Poor's credit analyst Maurice Austin. The ratings also reflect its high cost position in the Powder River Basin and Texas, relatively short reserve life, high customer concentration, challenges posed by the inherent risks of coal mining, and less than adequate liquidity to meet its near- term obligations. Still, the Company benefits from long-term contracts with a predictable revenue stream. W.R. GRACE: Reorganization Plan Approved by Bankruptcy Court ------------------------------------------------------------ W. R. Grace & Co.'s Joint Plan of Reorganization has been confirmed by the United States Bankruptcy Court for the District of Delaware. In her opinion, Judge Judith Fitzgerald resolved all outstanding objections to the Joint Plan in favor of Grace and its co-proponents. The Joint Plan next will be considered for confirmation by the United States District Court for the District of Delaware, a necessary step before Grace may exit Chapter 11. Grace filed for Chapter 11 protection on April 2, 2001. "This is a major step in the process of emerging from Chapter 11," said Fred Festa, Chairman, President and Chief Executive Officer. "I am delighted that our Joint Plan has been confirmed by the Bankruptcy Court. It is fair to all the parties and once and for all removes the uncertainty that has been clouding our future." The Joint Plan establishes two asbestos trusts to compensate personal injury claimants and property owners. Funds for the trusts will come from a variety of sources including cash, warrants to purchase Grace common stock, deferred payment obligations, insurance proceeds and payments from successor companies. The trusts' assets and operations are designed to cover all current and future asbestos claims. "We recognize that there are a few more steps in the legal process, which we hope will move forward expeditiously," said Festa. "I look forward to Grace emerging from Chapter 11 as a vibrant, growing company with a great future." W. R. Grace & Co. is a leading global supplier of catalysts and other products to petroleum refiners; catalysts for the manufacture of plastics; silica-based engineered and specialty materials for a wide range of industrial applications; sealants and coatings for food and beverage packaging, and specialty chemicals, additives and building materials for commercial and residential construction. Founded in 1854, Grace has operations in over 40 countries. Sealed Air's Statement Sealed Air Corporation reported that the Bankruptcy Court in the W. R. Grace bankruptcy entered its recommended findings and order on January 31, 2011, recommending confirmation of Grace's plan of reorganization. The bankruptcy process now proceeds to a review period in which the recommended order and findings may be challenged and appealed and during which several conditions must be satisfied before W. R. Grace's plan of reorganization may become effective. "We will be reviewing the order and findings to ensure that they implement W. R. Grace's plan of reorganization in a manner fully consistent with the terms of our settlement agreement, dated November 10, 2003. We stand ready to contribute our payment directly to one or more trusts to be established under Section 524(g) of the Bankruptcy Code once the provisions of the settlement agreement are fully met. Our payment includes cash and 18 million shares of common stock. As of December 31, 2010, the total cash payment would have been approximately $788 million, which reflects the principal settlement amount of $512.5 million and $275.5 million of accrued interest, which accrues at 5.5% per annum and is compounded annually. We intend to fund a substantial portion of the payment using available cash with the remainder from our committed credit facilities. The shares are currently recognized in our diluted weighted average number of shares outstanding for our net earnings per common share calculations. Our payment would resolve all current and future asbestos-related, fraudulent transfer and successor claims against us as a result of the Cryovac transaction with W. R. Grace in 1998." "The order and findings are an encouraging step in the W. R. Grace bankruptcy process. We will continue to review plan details, monitor the bankruptcy process and provide updates as necessary." 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) * Daily Beast Says Rhode Island, Connecticut Likely to Go Bankrupt ------------------------------------------------------------------ Taking into account each state's debt, projected 2012 budget shortfall, gross domestic product and unfunded pension, health care and other liabilities, The Daily Beast has prepared a slide presentation ranking 50 U.S. states and the likelihood they'll go bankrupt. A copy of the presentation is available at http://is.gd/cJjNE0 According to Daily Beast, Rhode Island, which had $9.2 billion debt in 2009 and a projected 2012 budget shortfall of $290 million, ranked first. Connecticut, which had 2009 debt of $28.4 billion and projected 2012 budget shortfall of $3.7 billion is second. Nebraska, with $2.5 billion debt in 2009, and projected 2012 budget shortfall of $314 million, ranked last. Aside from 2009 debt level and projected 2012 budget shortfall, Daily Beast also took note of the state's GDP for 2009, Debt/GDP Ratio, Unfunded Pension Liabilities and Unfunded Health Care and Other Liabilities. * JPMorgan CEO Predicts U.S. Municipal Bankruptcies --------------------------------------------------- Reuters' Michael Stott reports that JP Morgan Chase chief executive James Dimon on Thursday told a panel on "The Next Shock: Are We Better Prepared?" at the Davos World Economic Forum in Switzerland, that some U.S. municipalities would go bankrupt, though he did not believe that this was a systemic issue. "There are 14,000 municipalities and you are unfortunately going to see some bankruptcies," Mr. Dimon said, according to Reuters. "It will be an issue for some and they have built up these obligations, pensions kind of snuck up on people . . . you are going to see some municipalities use the bankruptcy courts to try to renegotiate some of those contracts," Reuters quotes Mr. Dimon as saying. Reuters relates Mr. Dimon said overall U.S. states were in good financial shape and had the means to tackle their financial woes. He did not believe the bankruptcy of some municipalities would trigger wider problems. "The total deficit of all states and all municipalities is 200 billion relative to the total U.S. deficit of 1.5 trillion so its really kind of small relative to that," Mr. Dimon said. According to Reuters, Mr. Dimon said, "It's there, it's a concern, it's going to have to be fixed, I just don't think it's going to stop growth in 2011 or 2012, it's just a negative factor overlying the American system." * Distressed Real-Estate Investor Strikes Again in New York City ---------------------------------------------------------------- Dow Jones' DBR Small Cap reports that a Manhattan developer with a taste for busted property deals is back at it, acquiring the loan used for the conversion of the Setai Wall Street condominium and spa. According to the report, Ziel Feldman, head of HFZ Capital Group, had the winning bid for the $147 million construction loan for the Setai, according to people familiar with the matter. The report relates that his bid of about $80 million beat out more than a dozen other investors. DBR notes that Mr. Feldman, a Queens-born former real-estate attorney, declined to comment on his plans for the Setai. But other property developers and lawyers say he will likely reach a deal with the developer, Zamir Equities, to take control of the building, the report says. DBR discloses that Asher Zamir, a principal at Zamir Equities, didn't respond to a request for comment on. The loan, which is in default, was sold by Anglo Irish Bank Corp., the troubled bank that was nationalized last year after suffering losses on property loans abroad when the market collapsed. Holliday Fenoglio Fowler ran the sale, the report adds. * KPMG, Other Advisers Ramp Up for Rise in Bank Restructurings -------------------------------------------------------------- Dow Jones' DBR Small Cap reports that audit, tax and advisory firm KPMG has positioned itself in anticipation of a rising number of loan portfolio sales -- triggered by overleveraged banks restructuring their balance sheets -- with the hire of a 10-strong team from rival PricewaterhouseCoopers to its debt divestment advisory business. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Total Share- Total Working Holders' Assets Capital Equity Company Ticker ($MM) ($MM) ($MM) ------- ------ ------- -------- -------- ABRAXAS PETRO AXAS US 178.1 (5.2) (1.7) ABSOLUTE SOFTWRE ABT CN 124.2 (6.0) (6.2) ACCO BRANDS CORP ABD US 1,097.3 261.9 (97.3) AEGERION PHARMAC AEGR US 2.9 (29.5) (27.3) ALASKA COMM SYS ALSK US 624.8 2.6 (15.3) AMER AXLE & MFG AXL US 2,071.4 61.9 (469.1) AMR CORP AMR US 25,357.0 (2,102.0) (3,643.0) ANACOR PHARMACEU ANAC US 20.4 (1.6) (8.2) ARKSON NUTRACEUT AKSN US - (0.0) (0.0) ARQULE INC ARQL US 94.1 45.1 (9.7) ARVINMERITOR INC ARM US 2,879.0 331.0 (1,023.0) AUTOZONE INC AZO US 5,640.5 (584.3) (817.2) BLUEKNIGHT ENERG BKEP US 296.0 (427.8) (152.8) BOARDWALK REAL E BEI-U CN 2,343.6 - (100.8) BOARDWALK REAL E BOWFF US 2,343.6 - (100.8) BOSTON PIZZA R-U BPF-U CN 111.3 5.0 (116.3) BRAVO BRIO RESTA BBRG US 162.8 (28.9) (61.5) CABLEVISION SY-A CVC US 7,501.6 (157.7) (6,222.8) CAMPUS CREST COM CCG US 327.5 - (60.7) CC MEDIA-A CCMO US 17,393.5 1,410.4 (7,219.6) CENTENNIAL COMM CYCL US 1,480.9 (52.1) (925.9) CENVEO INC CVO US 1,393.6 220.0 (332.5) CHENIERE ENERGY CQP US 1,797.0 30.3 (521.9) CHENIERE ENERGY LNG US 2,616.5 (137.1) (431.0) CHOICE HOTELS CHH US 403.3 (11.5) (75.5) CLEVELAND BIOLAB CBLI US 11.9 (9.7) (10.0) COMMERCIAL VEHIC CVGI US 289.3 114.0 (5.7) CUMULUS MEDIA-A CMLS US 324.1 (2.5) (349.3) DENNY'S CORP DENN US 312.7 (10.7) (102.4) DISH NETWORK-A DISH US 9,292.9 733.1 (1,416.5) DISH NETWORK-A EOT GR 9,292.9 733.1 (1,416.5) DOMINO'S PIZZA DPZ US 425.7 104.1 (1,241.9) DUN & BRADSTREET DNB US 1,727.3 (612.4) (717.4) EASTMAN KODAK EK US 6,844.0 960.0 (498.0) EPICEPT CORP EPCT SS 6.7 (1.1) (14.2) EXELIXIS INC EXEL US 372.9 (11.8) (217.6) FORD MOTOR CO F US 180,330.0 (18,558.0) (1,740.0) FORD MOTOR CO F BB 180,330.0 (18,558.0) (1,740.0) GENCORP INC GY US 981.8 150.8 (224.9) GLG PARTNERS INC GLG US 400.0 156.9 (285.6) GLG PARTNERS-UTS GLG/U US 400.0 156.9 (285.6) GRAHAM PACKAGING GRM US 2,840.3 259.1 (580.3) HEALTHSOUTH CORP HLS US 1,796.9 124.3 (394.9) HICKS ACQUISITIO HKACU US 0.8 (0.8) (0.1) HOVNANIAN ENT-A HOV US 1,817.6 1,101.9 (337.9) HOVNANIAN ENT-B HOVVB US 1,817.6 1,101.9 (337.9) HUGHES TELEMATIC HUTC US 111.4 1.9 (42.1) IBIO INC IBIO US 4.6 (4.7) (0.8) IDENIX PHARM IDIX US 63.1 24.0 (21.3) INCYTE CORP INCY US 464.6 305.0 (128.9) INTERMUNE INC ITMN US 143.9 10.2 (67.7) IPCS INC IPCS US 559.2 72.1 (33.0) ISTA PHARMACEUTI ISTA US 112.2 8.8 (71.8) JAZZ PHARMACEUTI JAZZ US 108.0 (13.3) (0.8) JUST ENERGY GROU JE CN 1,834.1 (578.0) (497.2) KNOLOGY INC KNOL US 658.7 53.5 (5.3) LIGAND PHARM-B LGND US 112.6 (1.4) (1.1) LIGHTING SCIENCE LSCG US 60.0 28.3 (122.4) LIN TV CORP-CL A TVL US 782.4 21.2 (146.9) LORILLARD INC LO US 3,504.0 1,665.0 (38.0) MAINSTREET EQUIT MEQ CN 399.4 - (8.5) MANNKIND CORP MNKD US 305.1 76.5 (181.4) MEAD JOHNSON MJN US 2,293.1 472.9 (358.3) MOODY'S CORP MCO US 2,348.2 508.8 (297.6) MORGANS HOTEL GR MHGC US 759.1 47.0 (42.1) MPG OFFICE TRUST MPG US 3,267.4 - (897.2) NATIONAL CINEMED NCMI US 836.1 40.5 (340.8) NAVISTAR INTL NAV US 9,730.0 2,246.0 (924.0) NEWCASTLE INVT C NCT US 3,760.1 - (591.2) NORTH AMERICAN G NMGLE US 0.0 (0.1) (0.1) NPS PHARM INC NPSP US 228.8 147.8 (149.8) NYMOX PHARMACEUT NYMX US 0.9 (1.0) (1.8) OTELCO INC-IDS OTT US 331.6 27.5 (3.5) OTELCO INC-IDS OTT-U CN 331.6 27.5 (3.5) PALM INC PALM US 1,007.2 141.7 (6.2) PDL BIOPHARMA IN PDLI US 257.5 26.1 (304.5) PETROALGAE INC PALG US 5.9 (8.2) (51.6) PLAYBOY ENTERP-A PLA/A US 165.8 (16.9) (54.4) PLAYBOY ENTERP-B PLA US 165.8 (16.9) (54.4) POWERWAVE TECH PWAV US 408.5 185.7 (4.8) PRIMEDIA INC PRM US 215.5 (5.8) (97.8) PRIMO WATER CORP PRMW US 29.0 (29.4) (9.6) PROTECTION ONE PONE US 562.9 (7.6) (61.8) QUALITY DISTRIBU QLTY US 284.3 26.9 (132.9) QUEPASA CORP QPSA US 3.4 2.0 (3.3) QWEST COMMUNICAT Q US 18,959.0 (1,163.0) (1,425.0) REGAL ENTERTAI-A RGC US 2,670.3 114.1 (267.3) RENAISSANCE LEA RLRN US 53.8 (38.5) (35.1) REVLON INC-A REV US 794.8 86.9 (991.8) RIGNET INC RNET US 93.2 9.5 (11.6) RSC HOLDINGS INC RRR US 2,736.4 (175.7) (37.5) RURAL/METRO CORP RURL US 293.7 46.4 (95.1) SALLY BEAUTY HOL SBH US 1,589.4 387.1 (460.3) SINCLAIR BROAD-A SBGI US 1,536.2 37.8 (156.0) SINCLAIR BROAD-A SBTA GR 1,536.2 37.8 (156.0) SMART TECHNOL-A SMA CN 559.1 201.9 (63.2) SMART TECHNOL-A SMT US 559.1 201.9 (63.2) STEREOTAXIS INC STXS US 47.5 (6.2) (5.3) SUN COMMUNITIES SUI US 1,164.1 - (131.0) SWIFT TRANSPORTA SWFT US 2,577.9 237.4 (83.2) SYNERGY PHARMACE SGYP US 2.7 (2.3) (1.8) TAUBMAN CENTERS TCO US 2,529.7 - (541.1) TEAM HEALTH HOLD TMH US 886.9 4.7 (18.2) THERAVANCE THRX US 212.6 161.1 (141.1) UAN CULTURAL & C GHBAU US 1.0 (0.4) (0.2) UNISYS CORP UIS US 2,840.1 472.1 (1,034.2) UNITED CONTINENT UAL US - (1,186.0) (2,206.0) UNITED RENTALS URI US 3,744.0 188.0 (15.0) VECTOR GROUP LTD VGR US 859.0 245.3 (37.7) VENOCO INC VQ US 766.2 20.4 (94.8) VIRGIN MOBILE-A VM US 307.4 (138.3) (244.2) VONAGE HOLDINGS VG US 362.4 (0.1) (111.4) WARNER MUSIC GRO WMG US 3,779.0 (592.0) (211.0) WEIGHT WATCHERS WTW US 1,103.1 (377.9) (708.2) WORLD COLOR PRES WC CN 2,641.5 479.2 (1,735.9) WORLD COLOR PRES WCPSF US 2,641.5 479.2 (1,735.9) WORLD COLOR PRES WC/U CN 2,641.5 479.2 (1,735.9) WR GRACE & CO GRA US 4,209.6 1,333.7 (175.1) YRC WORLDWIDE IN YRCW US 2,673.1 (288.2) (121.7) ZOGENIX INC ZGNX US 55.0 (0.9) (34.5) ********* 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 ***