/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110204.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, February 4, 2011, Vol. 15, No. 34 Headlines 325 PASO HOLDINGS: Artisan Hotel in Bankruptcy Again ABRAHAM PETROLEUM: Bankr. Court Abstains From Hearing Hassan Suit ACCREDITED HOME: Subprime Borrower's Release Not Bulletproof ACCURATE AUTO CARRIERS: Bankruptcy Auction Nets 400 Bidders AERIAL LIFT: Case Summary & 20 Largest Unsecured Creditors AFM INVESTMENT: Voluntary Chapter 11 Case Summary ALFRED VILLALOBOS: IRS Wants Ch. 7 Trustee to Take Over Assets ALLY FINANCIAL: Fitch Upgrades Issuer Default Rating to 'BB' AMBAC FINANCIAL: Dewey & LeBoeuf Charges $2.2MM for Nov.-Dec. AVAYA INC: Announces Offering of $1-Bil. Sr. Secured Notes AVISTAR COMMUNICATIONS: 3 Execs. Exercise Options to Buy Shares AWAL BANK: HSBC Bank USA Seeks Dismissal of Chapter 11 Case BANCO SANTOS: Brazil Case Recognized as Foreign Main Proceeding BASIC ENERGY: S&P Assigns 'B-' Rating to $250 Mil. Notes BASTROP BLACKHAWK: Case Summary & 5 Largest Unsecured Creditors BAY SPRINGS: Voluntary Chapter 11 Case Summary BERNARD L MADOFF: Trustee Unseals Complaint Against JPMorgan BERNARD L MADOFF: Davis Polk Balks at Confidentiality Violation BLOCKBUSTER INC: Summit Wants Case Converted to Chapter 7 BRAEWOOD RESIDENTIAL: Voluntary Chapter 11 Case Summary BROWN'S FAMILY: 2 Restaurants Remain Open; Third Closed CAPITAL GROWTH: May Consummate Sale Transaction With Pivotal Group CB HOLDING: Selling Another Liquor License for $250,000 CENTAUR LLC: Reaches $8.5-Million Deal With Churchill Downs CENTRAL LEASING: Files Schedules of Assets & Liabilities CENTRAL LEASING: Section 341(a) Meeting Scheduled for Feb. 23 CLOVERLEAF ENTERPRISES: Penn Ups Bid to $11MM; Court OKs Sale COACH AMERICA: May Need "Restructuring", Cut by Moody's to 'Caa1' CONSTAR INTERNATIONAL: Court OKs Key Financing Agreements CONTESSA PREMIUM: Schedules and Statements Now due March 11 CONTESSA PREMIUM: Gets Court's Interim Nod to Use Cash Collateral CONTESSA PREMIUM: Section 341(a) Meeting Scheduled for March 10 CRESCENT RESOURCES: Gets Raleigh Nod for Residences at Cameron CRESTRIDGE ESTATES: Creditor Can Pursue Rights on Property CUMULUS MEDIA: S&P Gives Positive Outlook, Affirms 'B-' Rating DBSD N.A.: Creditors to Have Enhanced Recovery Under Dish Plan DENNY'S CORP: CFO and CEO Named to Board of Directors DYNEGY INC: Habrok Capital Holds 5.6% Equity Stake DYNEGY INC: UBS AG Discloses 7.82% Equity Stake EASTMAN KODAK: No Current Plans for Sale or Spinoff, CEO Says ELWOOD ENERGY: Moody's Affirms 'Ba1' Rating on Senior Bonds EXCO RESOURCES: S&P Retains CreditWatch Negative on 'BB-' Rating FEY 240: Schedules February 23 Plan Confirmation Hearing FKF MADISON: Bankruptcy Judge Open to Appointing Trustee FLANDERS PROPERTIES: Case Summary & 8 Largest Unsecured Creditors FOUR LIONS: Files Schedules of Assets & Liabilities FOUR LIONS: Section 341(a) Meeting Scheduled for Feb. 28 GENDER PARTNERS: Dist. Ct. Affirms Stay for Bank Loan Guarantors GARNET BIOTHERAPEUTICS: Proofs of Claim Due By March 2, 2011 GENWORTH MORTGAGE: S&P Cuts Counterparty Credit Rating to 'BB+' GLOBAL CASH: Moody's Assigns 'B1' Rating to $235 Mil. Senior Loan GLOBAL CASH: S&P Changes Outlook to Stable, Affirms 'BB-' Rating GMX RESOURCES: Moody's Assigns 'Caa2' Rating to $200 Mil. Notes GMX RESOURCES: S&P Puts 'B-' Corp. Credit Rating; Outlook Stable GNP RLY: Involuntary Chapter 11 Case Summary GRAND BEAR: Asks La Salle County Board to Lower Property Taxes GULFSTREAM INT'L: Ch. 11 Spurs Regional Airport Woes GULFSTREAM INT'L: To Start Flying Montana EAS Routes HAWKS PRAIRIE: Pacific Real to Sell Hawks Prairie Property H.B. FENN: To File Proposal Under Canada's Bankruptcy Laws HEADLINE NEWS: Tacoma Writes Off $32,000 Advertising Debt ICOP DIGITAL: Bankruptcy Court Approves Sale Plan ILEC FAIRPOINT: S&P Assigns 'B' Corporate Credit Rating INDUSTRIAL ENTERPRISES: Omtammot DIP Loan Extended to July 31 INNKEEPERS USA: Midland Tries to Block LNR Opposition to Plan INTEGRA BANK: Bank Out of Compliance with Capital Directive IRVING TANNING: Tasman Industries Buys Business for $6.5 Million IRVING TANNING: Tasman Industries Offers $6.5 Million for Assets JAMES F BYRNES: Chapter 11 Filing Halts Bank's Auction JAMES F BYRNES: Case Summary & 20 Largest Unsecured Creditors KE KAILANI: Sec. 341 Meeting of Creditors Set for February 11 KE KAILANI: Files Schedules of Assets and Liabilities KGEN LLC: S&P Changes Outlook to Positive, Affirms 'BB-' Ratings L-3 COMMUNICATIONS: Fitch Expects to Rate New Senior Unsec. Notes L-3 COMMUNICATIONS: Moody's Affirms 'Ba1' Sr. Subordinated Ratings LA PALOMA'S: Moody's Affirms 'Caa2' on 2nd Lien Debt Facility LANDCO FAIR: Case Summary & 20 Largest Unsecured Creditors LANDCO JEFFERSON: Voluntary Chapter 11 Case Summary LEHMAN BROTHERS: Settles LB Bankhaus Intercompany Claims LHB REAL: Case Summary & 3 Largest Unsecured Creditors LIONS GATE: Files Schedules of Assets and Liabilities LOUISVILLE ORCHESTRA: Struggles to Meet Payroll Obligation LYONDELL CHEMICAL: BASF Wants Continuing Stay Lifted MARITIME TELECOMMUNICATIONS: S&P Assigns 'B' Corp. Credit Rating MICHAEL A HARRIS: Billing Protocol Not Applicable for Small Case MIKE V REAL ESTATE: Files Schedules of Assets & Liabilities MIKE V REAL ESTATE: Section 341(a) Meeting Scheduled for March 1 MORTGAGES LTD: Judge Nixes Appeal on ML Manager & Borrowers Deal MSR RESORT: Receives Loan Offers From Singapore & Paulson MTM PARTNERS: Voluntary Chapter 11 Case Summary MYSPACE INC: "Now Is The Right Time" for Sale, News Corp. Says NIELSEN COMPANY: Fitch Upgrades Issuer Default Ratings to 'B+' NORTH AVENUE: Voluntary Chapter 11 Case Summary OPTI CANADA: Declining Liquidity Cues' Moody's 'Caa3' Rating OTTER TAIL: Green Plains-Led Auction on Feb. 16 PENINSULA GAMING: Moody's Assigns 'Ba3' Rating to $80 Mil. Notes POINT BLANK: Seeks Approval on Backstop Purchase Agreement POMPANO CREEK: Section 341(a) Meeting Scheduled for March 10 RADIENT PHARMACEUTICALS: Agrees to Sell $8.4MM Convertible Notes RADIENT PHARMACEUTICALS: Seeks to Withdraw Form S-1 Registration RAFAELLA APPAREL: S&P Raises Corporate Credit Rating to 'B+' RDK MUNICIPAL: Voluntary Chapter 11 Case Summary RDK TRUCK: Voluntary Chapter 11 Case Summary REVEL AC: Moody's Assigns 'Caa1' Corporate Family Rating RMAA REAL: U.S. Trustee Wants Case Converted to Chapter 7 RUGGED BEAR: Amends List of 20 Largest Unsecured Creditors S & Y ENTERPRISES: Court Sets March 4 Bar Date for Proofs of Claim SATISFIED BRAKE: Intellectual Property Dispute Cues Bankruptcy SCANWOOD CANADA: Declared Insolvent by Halifax Court SHERWOOD FARMS: Centennial Moves Court to Appoint Ch. 11 Trustee SHUBH HOTELS PITTSBURGH: Judge May Appoint Chapter 11 Trustee SINCLAIR BROADCAST: Strikes Multi-Year Deal With Time Warner SLK DEVELOPMENT: Voluntary Chapter 11 Case Summary SMURFIT-STONE: Sued by Shareholder Over Buyout SOUTHWEST GEORGIA ETHANOL: Taps McKenna Long as Bankruptcy Counsel SOUTHWEST GEORGIA ETHANOL: Wants to Hire Epiq as Claims Agent SOUTHWEST GEORGIA ETHANOL: Proposes $10-Mil. of DIP Financing SPOT MOBILE: Receives $1.8 Million from Sale of Securities STARBRITE PROPERTIES: Voluntary Chapter 11 Case Summary STRAWBERRY PARK: Court Dismisses Involuntary Chapter 11 Case SUNRISE SENIOR: Greg Neeb's Employment Extended to 2013 SUPERIOR ACQUISITIONS: Creditor Wants Case Converted to Chapter 7 TRIBUNE CO: Professionals File Fee Applications for Sept.-Nov. TRICO MARINE: Court Approves Sale of Three Vessels ULTIMATE ACQUISITION: Organizational Meeting Set for Feb. 9 UNITED CONTINENTAL: AFA & IAM Seek Union Elections UNITED CONTINENTAL: Reports December 2010 Traffic Results U.S. DRY CLEANING: Disclosure Statement Hearing Set for Feb. 9 US AIRWAYS: Downgraded by Soleil Securities to "Hold" US AIRWAYS: To Cut 90 Jobs at Pittsburgh Int'l Airport US AIRWAYS: To Close Philippines Call Center by October US AIRWAYS: Wants to Join United in Alliance VILLAGE AT CAMP: Wants Plan Acceptance Period Extended to April 4 W.R. GRACE: Garlock Document Request Facing Objections * Accommodating Markets Shrink Maturing Junk-Rated Debt * Canadian Business Bankruptcies at Record Low, CIBC World Says * BOOK REVIEW: Leveraged Management Buyouts - Causes and Consequences ********* 325 PASO HOLDINGS: Artisan Hotel in Bankruptcy Again ---------------------------------------------------- Vic Kolenc at the El Paso Times reports that the closed Artisan Hotel Downtown is in bankruptcy again. 325 Paso Holdings, LLC, the Las Vegas-based investors group which bought the hotel building in a foreclosure sale in November for $250,000, and has been trying to sell it, has filed for Chapter 11 reorganization. The hotel, at 325 N. Kansas, in El Paso, Texas, was in Chapter 11 and Chapter 7 liquidation bankruptcy under its previous owner, Douglas Da Silva. The Las Vegas hotel operator opened 73 of the hotel's 105 rooms for a rocky five months last year before closing the hotel in March. According to the El Paso Times, 325 Paso Holdings is tied to Integrated Financial Associates, or IFA, a Las Vegas mortgage broker which put together a group of investors that lent Mr. Da Silva and the hotel almost $6 million. The report relates that in December, before the bankruptcy was filed, Timothy Deters, co-founder of NAC Development Co., a Las Vegas real estate development company, and a consultant for Integrated Financial Associates, told the El Paso Times he was trying to sell the hotel building. He said some El Paso and national hotel operators had shown interest. The El Paso Times also reports that City tax office records show the Artisan owes more than $417,000 in property taxes and late fees to the city, county and other taxing agencies. City officials are looking at options for collecting those taxes, according to a statement issued by the city. About 325 Paso Holdings 325 Paso Holdings, LLC, filed for Chapter 11 protection (Bankr. D. Nev. Case No. 10-34204) in Las Vegas, Nevada, on Dec. 30, 2010. Timothy P. Thomas, Esq., in Las Vegas, represents the Debtor. In its schedules, the Debtor disclosed assets of $3,220,000 and liabilities of $6,153,813. The petition was signed by Bill Dyer, president of managing member Integrated Financial Associates. ABRAHAM PETROLEUM: Bankr. Court Abstains From Hearing Hassan Suit ----------------------------------------------------------------- Bankruptcy Judge Enrique S. Lamoutte granted the Defendant's request to dismiss the suit, Abraham Petroleum Corp., v. Hassan and Sons Corp., Adv. Pro. No. 10-0015 (Bankr. D. P.R.). Judge Lamoutte said discretionary abstention is warranted in the case because, (1) Plaintiffs claims are based entirely on state law, (2) there is an open and ongoing state court proceeding available to the Debtor, and (3) Plaintiffs' resort to the Bankruptcy Court in this case at this time can be viewed as forum shopping. The claims for relief alleged in the complaint wholly revolve upon matters of local law, and resolution would not involve any issues of bankruptcy law. Therefore, discretionary abstention in favor of the state courts is appropriate. Notwithstanding, any monetary award against the Debtor must be channeled through the bankruptcy proceeding. On February 8, 2010, the Debtor filed a complaint against the Defendant for recovery of property, eviction, breach of contract, collection of money and damages. The complaint is premised on the breach of a lease and supply agreement entered into by the Debtor with the Defendant on March 30, 2008, for the use by the Defendant of the Debtor's service station at Barrio Hato Abajo, Arecibo, Puerto Rico. The Defendant agreed to operate the service station and purchase fuel from the Debtor. The complaint alleges that the Defendant failed to pay for rent and merchandise since February 2009. Additionally, the Defendant failed to pay the amounts corresponding to partial payments of the "key" or right to operate. Also, the complaint alleges breach of a sub lease agreement executed on May 1, 2007, between the Debtor and the Defendant for the use of real property located at Urbanizacion San Fernando in Bayamon, Puerto Rico, in which the Defendant agreed to operate the service station and purchase products from the Debtor. The Debtor notified the Defendant of its decision to rescind or cancel both contracts. The complaint includes six causes of action: breach of contract and eviction; debt collection; temerity; dispossession of premises and equipment; indemnification and damages; and damages, attorney's fees and expenses. The Defendant filed a motion to dismiss alleging that it filed a state court action against the Debtor on February 20, 2009, before the Superior Court of Bayamon, based on the same allegations, and therefore, the Bankruptcy Court should abstain from these proceedings. In effect the state court complaint filed against the Debtor raises five causes of action: cancellation of supply contract; cancellation of the lease of the property at Urb. San Fernando, Bayamon; cancellation of the lease of the property at Barrio Hato Abajo, Arecibo; cancellation of the sales contract of the going concern located at Urb. San Fernando and cancellation of the sales contract of the going concern located at Barrio Hato Abajo. The Defendant filed a proof of claim in the Debtor's bankruptcy case for $3,775,000. A copy of the Court's February 2, 2011 Opinion and Order is available at http://is.gd/qA9sUdfrom Leagle.com About Abraham Petroleum Based in Dorado, Puerto Rico, Abraham Petroleum Corporation filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 09-05928) on July 17, 2009. Charles Alfred Cuprill, Esq., in San Juan, Puerto Rico, served as bankruptcy counsel. In its petition, the Debtor estimated $1 million to $10 million in both assets and debts. ACCREDITED HOME: Subprime Borrower's Release Not Bulletproof ------------------------------------------------------------ WestLaw reports that a release that a borrower executed in favor of bankrupt subprime mortgage lenders was enforceable against him, and could be raised in support of an objection that the lenders filed to a proof of claim by the borrower in their jointly administered Chapter 11 cases, though the lenders had not also signed the release. It was enough that the release was signed by the party against whom enforcement was sought. However, the borrower presented sufficient evidence that he had signed the release under duress, at a time when he was not represented by counsel and under a physician's care for post-traumatic stress syndrome, in response to a threatened loss of his home to an unlawful foreclosure initiated at a time when he was not in fact in default, that the lenders could not rely on the release as basis for disallowing the borrower's claim. In re Accredited Home Lender Holding Co., --- B.R. ----, 2011 WL 304588 (Bankr. D. Del.). A copy of the Honorable Mary F. Walrath's Opinion dated Jan. 28, 2011, is available at http://is.gd/3uKlcmfrom Leagle.com About Accredited Home San Diego, California-based Accredited Home Lenders Holding Co. -- http://www.accredhome.com/-- was a mortgage banker servicing U.S. markets for conforming and non-prime residential mortgage loans operating throughout the U.S. and in Canada. Accredited sold its mortgage-servicing business in July 2009 as part of its bankruptcy. Accredited Home Lenders and its affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 09-11516) on May 1, 2009. Gregory G. Hesse, Esq., Lynnette R. Warman, Esq., and Jesse T. Moore, Esq., at Hunton & William LLP, serve as the Debtors' bankruptcy counsel. Laura Davis Jones, Esq., James E. O'Neill, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as Delaware counsel. Kurtzman Carson Consultants is the Debtors' claims agent. Andrew I Silfen, Esq., Schuyler G. Carroll, Esq., Robert M. Hirsch, Esq., at Arent Fox LLP in New York, and Jeffrey N. Rothleder, Esq., at Arent Fox LLP in Washington, DC, represent the official committee of unsecured creditors as co-counsel. Neil R. Lapinski, Esq., and Shelley A. Kinsella, Esq., at Elliott Greenleaf, represent the Committee as Delaware and conflicts counsel. As reported in the Troubled Company Reporter on Jan. 4, 2011, the Debtors filed a proposed Plan of Liquidation and a Disclosure Statement explaining that twice-amended plan. The Plan does not contemplate a continuation of the Debtors' collective businesses. Accredited Home Lenders estimated its assets at $10 million to $50 million and its debts at $100 million to $500 million in its Chapter 11 petition. ACCURATE AUTO CARRIERS: Bankruptcy Auction Nets 400 Bidders ----------------------------------------------------------- Hilco Industrial, LLC, and joint venture partner, Maynards Industries, Ltd., announced they have been successful with its auction sale of 148 trucks, trailers and auto carriers on behalf of the bankruptcy estate and creditors of Romulus, Michigan-based Accurate Auto Carriers, LLC. The webcast auction, which attracted an international gathering of more than 400 online and on-site bidders, lasted two hours and generated revenues approximately 25% greater than anticipated. Vehicles sold included Freightliner, Sterling, Kenworth, Peterbilt, International and Volvo tractors as well as trailers from Cottrell, Boydstun, Wabash, Wade, Kentucky, Westwind, Great Dane and Wally Auto Transport Trailers. Commenting on the sale results, Robert Levy, a managing partner with Hilco Industrial, said, "This was a superb collection of assets that attracted significant interest, in part due to the strengthening of the marketplace for over the road vehicles in general and auto carriers in particular." He added, "Production of new vehicles has slowed over the past three to four years and, simultaneously, the available inventory of late model vehicles is shrinking, which has fostered greater demand." Stephan Wolf, also a managing partner of Hilco Industrial, said, "We employed our HilCast(R) webcast auction technology for this sale in order to maximize the number of bidder participants and provide all bidders with full and equal access to the sale process. Our technology enables bidders to see the assets as they are put on the block and verbally communicate on a real-time basis with the auctioneer versus other systems that rely solely on mouse-clicks to enter bids." In recent years, Hilco Industrial and Maynards have conducted numerous asset disposition sales in the automotive/transportation sector, principally on behalf of Liquidation Motors Company and Old Carco, LLC, the entities of General Motors and Chrysler, respectively, left to settle past bankruptcy liability claims. AERIAL LIFT: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Aerial Lift, Inc. P.O. Box 66 Milford, CT 06460 Bankruptcy Case No.: 11-30215 Chapter 11 Petition Date: February 1, 2011 Court: U.S. Bankruptcy Court District of Connecticut (New Haven) Judge: Lorraine Murphy Weil Debtor's Counsel: Douglas S. Skalka, Esq. NEUBERT, PEPE, AND MONTEITH 195 Church Street, 13th Floor New Haven, CT 06510 Tel: (203) 821-2000 Fax: 203-821-2009 E-mail: dskalka@npmlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $100,001 to $500,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/ctb11-30215.pdf The petition was signed by Cheryl DePiero Hull, president. AFM INVESTMENT: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: AFM Investment, Inc. 5622 Havenwoods Houston, TX 77066 Bankruptcy Case No.: 11-31145 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Samuel L. Milledge, Esq. MILLEDGE LAW FIRM, P.C. 10333 Northwest Freeway, Suite 202 Houston, TX 77092 Tel: (713) 812-1409 Fax: (713) 812-1418 E-mail: milledge@milledgelawfirm.com Scheduled Assets: $1,200,000 Scheduled Debts: $700,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Syed Mohuiddin, president. ALFRED VILLALOBOS: IRS Wants Ch. 7 Trustee to Take Over Assets -------------------------------------------------------------- Dale Kasler at The Sacramento Bee reports that the Internal Revenue Service has asked a bankruptcy judge to convert Alfred Villalobos' Chapter 11 bankruptcy case to a Chapter 7 liquidation proceeding, saying Mr. Villalobos is "depleting" his fortune. According to the report, the IRS wants the court to crack down on Mr. Villalobos, the businessman in the middle of the CalPERS bribery scandal. IRS stated that, under Mr. Villalobos' control, his assets are being "grossly mismanaged." The Debtor is allegedly falling behind on mortgage payments while letting family and associates live in his nine homes, charging them little or no rent. The agency said it is owed more than $2.5 million by the Debtor. In a Chapter 7 case, Mr. Villalobos' real estate holdings and other assets would be placed under the control of a trustee. About Alfred J.R. Villalobos Stateline, Nevada-based Alfred J.R. Villalobos -- together with Arvo Art, Inc., and two other companies -- filed for Chapter 11 bankruptcy protection on June 9, 2010 (Bankr. D. Nev. Case No. 10- 52248). Stephen R. Harris, Esq., at Belding, Harris & Petroni, Ltd., assists the Debtors in their restructuring effort. Mr. Villalobos estimated assets and debts at $10 million to $50 million. According to The Sacramento Bee, Mr. Villalobos sought bankruptcy protection a month after then-Attorney General Jerry Brown accused him in a lawsuit of bribing key officials with the California Public Employees' Retirement System. Mr. Brown's lawyers quickly obtained a court order placing Mr. Villalobos' assets under control of an examiner. By filing for bankruptcy protection, Mr. Villalobos halted Mr. Brown's lawsuit and was able to regain control of his assets. ALLY FINANCIAL: Fitch Upgrades Issuer Default Rating to 'BB' ------------------------------------------------------------ Fitch Ratings has upgraded the long-term Issuer Default Rating of Ally Financial Inc. to 'BB' from 'B'; the Rating Outlook is revised to Stable from Positive. The upgrade reflects the risk-reduction efforts undertaken by the company in its mortgage operations, demonstration of consistent operating profitability in all reportable segments, improved funding flexibility offered by the deposit-raising ability and economical access to public/private debt markets, and maintenance of solid liquidity and capital levels. Since late 2009, Ally has been active in de-risking its mortgage business which was a drag on the company's earnings for the past few years. In 2010, the company completed the sale of its European mortgage operations, shedding $11 billion in assets and contingent liabilities, sold its struggling resort finance portfolio with $1 billion in unpaid principal balance and continued to manage its remaining legacy mortgage assets, selling $2.5 billion in 2010 with gains to carrying value. Furthermore, Ally's wholly-owned mortgage subsidiary Residential Capital LLC reached important rep and warranty settlements with government sponsored enterprises, Freddie Mac and Fannie Mae, which effectively caps future rep and warranty losses on GSE exposure. Ally still continues to face potential losses on non-GSE exposure associated with private label securities and monoline insurers, but Fitch believes that future rep and warranty losses should be manageable in the context of Ally's repurchase reserves, core earnings and capital base. Repurchase reserve stood at $830 million at Dec. 31, 2010 against outstanding claims of $888 million and included the $462 million settlement with Fannie Mae in the fourth quarter of 2010 (4Q'10). Fitch believes that the company will prudently add to its reserves in light of any pick-up in claim activity. Operating performance has been strong with the company reporting $1.1 billion in net earnings in 2010, compared to a loss of $10.3 billion in 2009. All three operating segments (automotive, mortgage and insurance) were profitable throughout the year. Improved results are a factor of strong growth in auto originations, continued improvement in credit trends, lower interest expense due to favorable funding mix, and strong fee margins in new mortgage originations. Fitch expects positive earnings generation in 2011, although profits are likely to be below 2010 levels as higher yielding, higher risk assets roll off and the asset mix shifts toward lower yielding but better quality auto and mortgage originations. Credit quality has continued its positive trend quarter-over- quarter. In the auto space, replacement of lower quality older vintage loans with higher quality originations combined with a strong used-car market is having a favorable impact on credit metrics. In the mortgage space, credit quality has improved and is performing within expectations, following the strategic actions taken by the company in 4Q'09. Overall, non-performing loans totaled $1.5 billion at Dec. 31, 2010, down significantly from $2.7 billion in 2009. Net charge-offs were $240 million in 4Q'10 compared to $3.9 billion in 4Q'09. Allowance as a percentage of NPLs was a strong 124% at Dec. 31, 2010, compared to 91% in the prior year. While the mortgage portfolio could be susceptible to further decline in home prices and macroeconomic risks, it is becoming a smaller and more manageable part of the total receivables and loan portfolio. Fitch believes that the auto- finance portfolio, which at Dec. 31, 2010 accounted for $96 billion or about 80% of Ally's total loan and lease portfolio, should help further stabilize overall portfolio credit performance. Capital ratios improved during 2010, despite the consolidation of $19 billion of off-balance-sheet assets on Jan. 1, 2010, in accordance with SFAS 166/167. Tier 1 capital ratio improved 85 basis points year-over-year to 15.0%, driven by positive earnings, reduction in higher risk-weighted assets primarily related to the sale of European mortgage assets ($11 billion) and amortization of the lease portfolio ($6.9 billion), offset by strong auto and mortgage originations during the year. Furthermore, tier 1 common capital increased 65% to $12.7 billion in 2010, following the U.S. Treasury's 4Q'10 conversion of $5.5 billion from mandatory convertible preferred to common equity. The tier 1 common capital ratio was 8.6% at Dec. 31, 2010, up significantly from 4.8% a year earlier. The strengthening of the tier 1 common ratio provides additional protection to absorb contemplated regulatory changes and any unexpected macroeconomic risk. The parent's available liquidity, which includes cash, unencumbered investment securities, and unused committed capacity, was $23.8 billion at Dec. 31, 2010, which represents approximately 20% of total loans and lease portfolio. Liquidity is currently being conservatively managed in light of the upcoming debt maturities over the next few years. On a consolidated basis, Ally has $9.5 billion and $12.6 billion in unsecured debt due in 2011 and 2012, respectively. Fitch believes that Ally will be able to refinance these maturing debt obligations with a combination of balance sheet liquidity, future asset sales and deposit growth. Following the 4Q'10 MCP conversion, Treasury is now a 74% shareholder of Ally. Fitch has downgraded the Support rating to '5' to reflect its view that the Treasury investment is not considered to be long-term and is likely to be replaced by third party capital. The Stable Outlook reflects Fitch's expectation for continuation of actions to further de-risk the legacy mortgage business, consistent operating profitability and maintenance of solid capital and liquidity levels. The recognition of higher than expected rep and warranty losses that results in a material decline in tangible capitalization, declines in operating performance due to asset quality deterioration, and/or weakening of the liquidity profile could pressure ratings. Conversely, improved market share and growth in the core auto finance franchise, better credit metrics in the residential mortgage business, expansion of the banking franchise along with the growth in the bank's deposit funding base while maintaining a conservative capital and liquidity posture, could lead to upward rating momentum. Ally is one of the world's largest automotive financial services companies with approximately $172 billion of assets at Dec. 31, 2010. Founded in 1919 as a wholly owned subsidiary of General Motors Corporation (currently General Motors Company, or GM), Ally is the official preferred source of financing for GM, Chrysler, Saab, Suzuki, Fiat, and Thor Industries vehicles and offers a full suite of automotive financing products and services in key markets around the world. Ally's other business units include mortgage operations and commercial finance, and through its subsidiary, Ally Bank, it offers online retail banking products. On Dec. 24, 2008, Ally became a bank holding company under the Bank Holding Company Act of 1956. Fitch has taken these rating actions with a Stable Outlook: Ally Financial Inc. -- Long-term IDR upgraded to 'BB' from 'B', -- Senior unsecured upgraded to 'BB' from 'B/RR4', -- Senior shelf upgraded to 'BB' from 'B/RR4', -- Short-term debt affirmed at 'B', -- Individual upgraded to 'C/D' from 'D', -- Support downgraded to '5' from '4', -- Support Floor downgraded to 'NF' from 'B', -- Long-term FDIC guaranteed debt affirmed at 'AAA'; -- Short-term FDIC guaranteed debt affirmed at 'F1+'. GMAC International Finance B.V. -- Long-term IDR upgraded to 'BB' from 'B', -- Senior unsecured upgraded to 'BB' from 'B/RR4', -- Short-term IDR affirmed at 'B', -- Short-term debt affirmed at 'B'. GMAC Bank GmbH -- Long-term IDR upgraded to 'BB' from 'B', -- Senior unsecured upgraded to 'BB' from 'B/RR4', -- Short-term IDR affirmed at 'B', -- Short-term debt affirmed at 'B'. Ally Credit Canada Limited -- Long-term IDR upgraded to 'BB' from 'B', -- Senior unsecured upgraded to 'BB' from 'B/RR4', -- Short-term IDR affirmed at 'B', -- Short-term debt affirmed at 'B'. GMAC Financial Services NZ Limited -- Long-term IDR upgraded to 'BB' from 'B', -- Short-term IDR affirmed at 'B', -- Short-term debt affirmed at 'B'. GMAC Australia LLC -- Long-term IDR upgraded to 'BB' from 'B', -- Short-term IDR affirmed at 'B', -- Short-term debt affirmed at 'B'. GMAC (U.K.) plc -- Short-term IDR affirmed at 'B', -- Short-term debt affirmed at 'B'. Ratings Withdrawn: GMAC Australia (Finance) Ltd -- Short-term IDR 'B'; -- Short-term debt 'B'. AMBAC FINANCIAL: Dewey & LeBoeuf Charges $2.2MM for Nov.-Dec. ------------------------------------------------------------- Professionals employed and retained in Ambac Financial Group, Inc.'s Chapter 11 case filed applications for allowance of fees and reimbursement of expenses, pursuant to Section 331 of the Bankruptcy Code for these periods: Firms Period Fees Expenses ----- ------ ---------- -------- Dewey & LeBoeuf LLP 11/08/10- $2,227,426 $51,181 12/31/10 KPMG LLP 11/08/10- $475,223 $1,027 12/31/10 Morrison & Foerster LLP 11/17/10- $472,663 $1,818 12/31/10 Lazard Freres & Co. LLC 11/22/10- $120,000 $383 12/31/10 About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Case No. 10-15973) on November 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed $30.05 billion in total assets, $31.47 billion in total liabilities, and a $1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of ($394.5 million) and total liabilities of $1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about $1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP represent the Debtor. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Ambac Financial Group Inc. (http://bankrupt.com/newsstand/or 215/945-7000) AVAYA INC: Announces Offering of $1-Bil. Sr. Secured Notes ---------------------------------------------------------- Avaya Inc. announced that it intends to raise $1 billion in gross proceeds through a private placement offering of senior secured notes due 2019. The net proceeds from the notes offering would be used to repay a portion of the term loans outstanding under the Company's senior secured credit facility and to pay related fees and expenses. Ashley Lutz at Bloomberg News, citing a person familiar with the offering, reports that Avaya could issue as soon as next week. Bloomberg News notes that Avaya is issuing $1 billion of notes as the spreads investors demand to hold high-yield debt have narrowed in the past month. Investors are demanding 489 basis points, or 4.89 percentage points, of extra yield to hold speculative-grade bonds instead of Treasuries, down from 532 basis points a month ago, according to Bank of America Merrill Lynch's U.S. High Yield Master II index. "There is strong demand, there have been a lot of strong deals that have been easily absorbed into the market," said Vicki Bryan, a senior high-yield analyst at Gimme Credit LLC. "An increase in high-yield issuance should continue into the short-term." About Avaya Inc. Avaya, Inc., based in Basking Ridge, N.J., is a supplier of communications systems and software for enterprise customers. Avaya was acquired by private equity firms, Silver Lake Partners and TPG in October 2007. At Sept. 30, 2010, Avaya Inc.'s balance sheet showed $9.26 billion in assets, $2.02 billion in current liabilities, $8.67 billion in non-current liabilities, stockholders' deficiency of $1.43 billion. * * * In January 2011, Standard & Poor's Ratings Services revised its outlook on Avaya Inc. to stable from negative, reflecting preservation of liquidity measures through the early phases of its integration of the Nortel assets, which Avaya acquired in December 2009. In addition S&P affirmed all its ratings on the Company, including its 'B-' corporate credit rating. "The rating is based on our expectation that the Company will sustain positive operating trends from the last three quarters," said Standard & Poor's credit analyst Lucy Patricola. S&P expects that revenues will remain under pressure, reflecting the mature nature of voice-based telephony, and that margins will gradually improve as Avaya continues its plans to integrate and streamline the recently acquired Nortel business. AVISTAR COMMUNICATIONS: 3 Execs. Exercise Options to Buy Shares --------------------------------------------------------------- In separate Form 4 filings with the Securities and Exchange Commission, directors and officers of Avistar Communications Corp., disclosed acquisition of shares of the company on February 1, 2011 at $0.34 per share: Shares Director/ Beneficially Owned Officer Amount After Transaction --------- ------ ------------------ Robert F. Kirk 19,941 139,881 Michael James Dignen 11,011 11,011 Stephen Warren Westmoreland 18,352 41,293 The Shares are acquired pursuant to the Employee Stock Purchase Plan of Avistar Communications Corporation. About Avistar Communications Headquartered in San Mateo, California, Avistar Communications Corporation (Nasdaq: AVSR) -- http://www.avistar.com/-- holds a portfolio of 80 patents for inventions in video and network technology and licenses IP to videoconferencing, rich-media services, public networking and related industries. Current licensees include Sony Corporation, Sony Computer Entertainment Inc. (SCEI), Polycom Inc., Tandberg ASA, Radvision Ltd. and Emblaze-VCON. The Company's balance sheet at December 31, 2010, showed $3.27 million in total assets, $11.12 million in total liabilities and a $7.85 million stockholders' deficit. The Company reported a net loss of $1.88 million on $1.62 million of revenue for the three months ended December 31, 2010, compared with a net loss of $1.54 million on $1.89 million of revenue for the same period a year ago. AWAL BANK: HSBC Bank USA Seeks Dismissal of Chapter 11 Case ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that HSBC Bank USA N.A. is asking the U.S. Bankruptcy Court for the Southern District of New York to dismiss the Chapter 11 case of Awal Bank BSC. HSBC says dismissal is proper. It notes that there has been no significant activity in the case since the bankruptcy judge -- within days of the commencement of the Chapter 11 case -- rejected Awal Bank's request for a structuring of the reorganization in which there would be no creditors' committee and no lists of assets and debt, with distributions made to creditors by the court in Bahrain and payment to professionals without bankruptcy court approval. About Awal Bank Awal Bank BSC is a Bahrain lender owned by Saudi Arabian Saad Group. Awal Bank was principally an investment company that provides wholesale banking services in Bahrain including the acceptance of deposits and the making of loans. Awal Bank was taken into administration by the Central Bank of Bahrain on July 30, 2009, after defaulting on loans. U.S. lawyers for the bank said last year that under Bahrain law, Awal's administrator had two years to decide if the bank should liquidate or be returned to management and shareholders. Stewart Hey, Esq., at Charles Russell LLP, as external administrator of Awal Bank BSC, made a voluntary petition under Chapter 15 of the U.S. Bankruptcy Code for the bank (Bankr. S.D.N.Y. Case No. 09-15923) on Sept. 30, 2009, following the administration proceedings. In 2010, the bank began experiencing a liquidity squeeze, brought on in part, by the global economic crisis. The bank ceased to operate as a going concern since it was place into administration. Awal Bank filed a chapter 11 petition (Bankr. S.D.N.Y. Case No. 10-15518) in Manhattan on October 21, 2010. The Debtor estimated $50 million to $100 million and debts in excess of $1 billion as of the petition date. BANCO SANTOS: Brazil Case Recognized as Foreign Main Proceeding --------------------------------------------------------------- On January 13, 2011, the U.S. Bankruptcy Court for the Southern District of Florida granted the motion of Vanio Cesar Pickler, as trustee of Banco Santos S.A., seeking recognition of Banco Santos' proceeding pending in the 2nd Bankruptcy Court of Sao Paulo, Brazil, as a "foreign main proceeding" pursuant to 11 U.S.C. 1517(b)(1). By virtue of the Court's recognition of Banco Santos' proceeding in Brazil as a foreign main proceeding, among other things, all persons and entities are stayed from executing against the assets of Banco Santos located in the United States. A copy of the U.S. Recognition Order is available for free at: http://bankrupt.com/misc/BancoSantos.recognitionorder.pdf Liquidation Proceeding in Brazil As reported in the Troubled Company Reporter on December 14, 2010, Banco Santos was a prominent bank in Brazil, until events beginning around the end of 2004 eventually led to the bank being liquidated in 2005. On November 12, 2004, the Central Bank of Brazil felt compelled to intervene after it appeared that Banco Santos was facing insolvency due to an apparent deficit of hundreds of millions of reals (Brazil's currency). The insolvency was suspected to have been the result of unscrupulous dealings by Edemar Cid Ferreira, the former head of Banco Santos, as well as others of Banco Santos' officers and directors. Brazilian investigators believe that Mr. Ferreira, with the help of his wife, son, and others, set up a series of holding companies and trusts linked substantially to one bank and one offshore company they apparently controlled -- Bank of Europe in Antigua and Alsace Lorraine Investment Services Ltd. in the British Virgin Islands. Utilizing these offshore vehicles, Banco Santos would encourage, and in some cases require, investors to deposit cash in favor of the Bank of Europe in Antigua as collateral for loans in Brazil. Eventually the scheme began to unravel, leading Banco Santos to take measures such as raising cash by selling junk bonds to the offshore vehicles. Millions of dollars (or reals) invested offshore were misappropriated by Mr. Ferreira, including spending on a lavish art collection valued in the tens of millions of dollars. In addition, Mr. Ferreira lives in a residence in Sao Paulo that he remodeled circa 2003-2004 at the expense of some US$60 million, which is owned by two of the Related Entities, whose shares in turn are owned by offshore vehicles. As a result of his complicity in the collapse of Banco Santos, Mr. Ferreira was charged by Brazil's federal police with financial crimes and money laundering, among other things. He was eventually convicted and sentenced to 21 years in prison. He remains out of prison on bail pending an appeal. Other persons associated with Banco Santos also were charged with crimes and convicted. On May 4, 2005, Banco Santos was placed into extra-judicial liquidation, which is a precursor to full bankruptcy under Brazilian law. On September 20, 2005, the Brazilian Court issued an Order converting the extra-judicial liquidation into a full, court-supervised bankruptcy, and also appointed the Trustee as Judicial Administrator of Banco Santos. The Banco Santos Proceeding remains pending and the Trustee is overseeing efforts to identify, locate, and capture assets belonging to the estate and the Related Parties. Today, the Estate of Banco Santos has 1,969 creditors and debts of about R$2.4 billions (around US$1.4 billion). The total of Banco Santos' proven assets recovered by the Trustee to date, however, is 900 million reals (approximately US$530 million). Based on the Trustee's investigation, information from the Brazilian investigators, and other sources, the Trustee believes that a significant amount of assets were diverted by Mr. Ferreira and/or others prior to the Central Bank's intervention. The Trustee desires to proceed with an investigation into the assets of Banco Santos and of the Related Entities, including, for example, as to assets that are in the U.S. or that were transferred through the U.S., as well as transactions involving Banco Santos and the Related Entities with persons or entities located in the U.S. About Banco Santos Vanio Cesar Pickler Aguiar, as foreign representative for Sao Paulo, Brazil-based Banco Santos S.A., filed a Chapter 15 petition (Bankr. S.D. Fla. Case No. 10-47543) in Miami, Florida. The Chapter 15 petition estimates that the Debtor has assets of US$500 million to US$1 billion and debts of more than US$1 billion. Gregory S. Grossman, Esq., in Miami, Florida, represents the Trustee in the Chapter 15 case. The Trustee is also represented by: Astigarraga Davis, Esq. MULLINS & GROSSMAN P.A. 701 Brickell Avenue, 16th Floor Miami, Florida 33131 Tel: (305) 372-8282 Fax: (305) 372-8202 E-mail: ggrossman@astidavis.com edavis@astidavis.com BASIC ENERGY: S&P Assigns 'B-' Rating to $250 Mil. Notes -------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its issue-level and recovery ratings to Basic Energy Services Inc.'s proposed $250 million senior unsecured notes due 2019. The issue- level rating is 'B-' (one notch below the corporate credit rating). At the same time, S&P assigned a recovery rating of '5', indicating S&P's expectation of modest (10% to 30%) recovery in the event of a payment default. "Our recovery analysis incorporates Basic's plans to use the proceeds to tender for the company's existing 11.625% senior secured notes due 2014 and to pay fees and expenses associated with the transaction," said Standard & Poor's credit analyst Patrick Lee. "The analysis also reflects Basic's plan to execute a new $165 million senior secured revolving credit facility to replace its current $30 million credit facility." Both facilities are unrated. An updated recovery report will be published on RatingsDirect following this release. Midland, Texas-based Basic is an oilfield services provider engaged primarily in well servicing, fluid services, completion and remedial services, and contract drilling. S&P's corporate credit rating on Basic is 'B', and the outlook is stable. Ratings List Corporate credit rating B/Stable/-- New Ratings $250 mil Sr Unscd Nts Due 2019 B- Recovery rating 5 BASTROP BLACKHAWK: Case Summary & 5 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Bastrop Blackhawk, LLC fdba Lakeside Hospital at Bastrop fdba Lakeside Family Health Center of Bastrop fdba Lakeside Regional Medical Center fdba Lakeside Medical Center c/o KJJO, Ltd., Manager c/o Kevin J. Owens 209 Watersong Ln Georgetown, TX 78628-6954 Bankruptcy Case No.: 11-10273 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: B. Weldon Ponder, Jr., Esq. Building 3, Suite 200 4601 Spicewood Springs Road Austin, TX 78759-7841 Tel: (512) 342-8222 Fax: (512) 342-8444 E-mail: welpon@austin.rr.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's five largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txwb11-10273.pdf The petition was signed by Kevin J. Owens, agent for member/manager, KJJO, Ltd. BAY SPRINGS: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Bay Springs Academy, LLC 101 Rejen Drive Carrollton, GA 30117 Bankruptcy Case No.: 11-10385 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Northern District of Georgia (Newnan) Debtor's Counsel: J. Nevin Smith, Esq. SMITH DIMENT CONERLY, LLP 402 Newman Street Carrollton, GA 30117 Tel: (770) 834-1160 Fax: (770) 834-1190 E-mail: cstembridge@smithdiment.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Gilbert A. Barker, Jr., manager. Affiliates of Bay Springs Academy filing separate Chapter 11 petitions on February 1: Entity Case No. ------ -------- The Carrollton Academy, LLC 11-10386 Luella Academy, LLC 11-10387 Mirror Lake Academy, LLC 11-10388 Stonebridge Academy, LLC 11-10389 BERNARD L MADOFF: Trustee Unseals Complaint Against JPMorgan ------------------------------------------------------------ Irving H. Picard, the Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC disclosed that his complaint against JPMorgan Chase & Co., JPMorgan Chase Bank, N.A., J.P. Morgan Securities LLC and J.P. Morgan Securities Ltd. -- initially filed under seal on December 2, 2010 in the United States Bankruptcy Court for the Southern District of New York -- would be unsealed and its details made available to the public. The complaint seeks to recover nearly $1 billion in fees and profits and an additional $5.4 billion in damages for JPMC's decades-long role as BLMIS's primary banker, aiding and abetting Madoff's fraud. All recovered monies will be placed into the Customer Fund and distributed, pro rata, to BLMIS customers with valid claims. The Trustee initially filed the complaint under seal because JPMC had contended that information it had provided to the Trustee in the course of his investigation was confidential. "However, from the start, we have maintained that the Trustee's complaint should be made public," said David J. Sheehan, lead counsel for Mr. Picard and a partner at Baker & Hostetler LLP, the court-appointed counsel for the Trustee. "We have reached an agreement with opposing counsel to unseal a large majority of the complaint, with the exception of several allegations as well as the identities of the bank's employees and customers," said Deborah Renner, a partner at Baker & Hostetler. The 114-page complaint, which includes quotations from internal emails at the bank, contains substantial detail supporting allegations that JPMC knew or should have known that Madoff was likely engaging in fraud. "Incredibly, the bank's top executives were warned in blunt terms about speculation that Madoff was running a Ponzi scheme, yet the bank appears to have been concerned only with protecting its own investments in BLMIS feeder funds," said Ms. Renner. "As we allege in the complaint, JPMC had a palpable concern that Madoff was a fraud for years, but it was not until October 2008 that it reported Madoff to government officials. Even then, JPMC executives did not restrict the BLMIS bank account, even though it was being used to launder money from the Ponzi scheme," added Ms. Renner. "As we allege, JPMC ignored its anti-money laundering obligations and repeatedly allowed suspicious transactions for high dollar amounts to occur in the BLMIS account," said Mr. Sheehan. "The complaint further alleges that, as the BLMIS banker, JPMC had financial reports in its possession that clearly evidenced fraud. The same reports led a prominent fund manager to conclude that fraudulent activity was highly likely," said Mr. Sheehan. "In addition to the indicia of fraud JPMC saw given its role as BLMIS's primary banker for more than two decades, JPMC gained additional, unique insight into Mr. Madoff and his operation at BLMIS as it conducted due diligence for its own investments in BLMIS feeder funds." "There is much more to come, in the way of documents and testimony, as we enter the discovery phase of the litigation," said Ms. Renner. "We will push for more information from JPMC in the course of the litigation so that the public can learn the full role of the bank in aiding and abetting Madoff's Ponzi scheme," said Mr. Sheehan. In addition to Mr. Sheehan and Ms. Renner, the Trustee acknowledges the contributions of Baker & Hostetler attorneys who worked on both the drafting and unsealing of the JPMC complaint: Keith Murphy, Seanna Brown , Jessie Gabriel, Jennifer Vessells, Lauren Hilsheimer and Lindsey D'Andrea. * * * The Wall Street Journal's Michael Rothfeld reports that according to the unsealed complaint, JPMorgan ignored or dismissed warning signs about the Madoff fraud even as it earned hundreds of millions of dollars from its relationship with his firm. The suit says JPMorgan stood "at the very center" of Mr. Madoff's fraud, alleging that bankers at JPMorgan discussed the possibility that Mr. Madoff was operating a Ponzi scheme, worried that a firm of such size was audited by a storefront accountant, and called his returns "too good to be true." "While numerous financial institutions enabled Madoff's fraud, JPMC was at the very center of that fraud, and thoroughly complicit in it," according to the 115-page lawsuit. According to the Journal, JPMorgan said in a statement that the lawsuit "is meritless and is based on distortions of both the relevant facts and the governing law." The bank said it "did not know about or in any way become a party to the fraud orchestrated by Bernard Madoff." The Journal notes the suit seeks the return of nearly $1 billion in JPMorgan's profits and fees, and $5.4 billion in damages. It goes into great detail about the bank's alleged efforts, starting in about 2006, to make money by offering products tied to Mr. Madoff through investment funds that fed money to him. According to the Journal, the suit alleges that JPMorgan only reported its suspicions of Mr. Madoff to British authorities in late October 2008, two months before he surrendered. In a suspicious activity report filed with Britain's Serious Organised Crime Agency, the bank said the performance of Mr. Madoff's investments appeared to be "too good to be true -- meaning that it probably is." Bloomberg News reports that Mr. Picard's lawyer David Sheehan said in the statement JPMorgan "ignored its anti-money laundering obligations and repeatedly allowed suspicious transactions for high dollar amounts to occur in the BLMIS account." Bloomberg News says Jennifer Zuccarelli, a spokeswoman for the bank, said JPMorgan will fight the lawsuit. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) As of October 29, 2010, a total of US$5.69 billion in claims by investors has been allowed, with US$741.2 million to be paid by the Securities Investor Protection Corp. Investors are expected to receive additional distributions from money recovered by Mr. Picard from lawsuits or settlements. BERNARD L MADOFF: Davis Polk Balks at Confidentiality Violation --------------------------------------------------------------- Karen Wagner, Esq., at Davis Polk & Wardwell, counsel to the defendants in Picard v. Katz, Adv. Pro No. 10-05287 (Bankr. S.D.N.Y.), sent a letter to the bankruptcy court regarding the request of David Sheehan that the court unseal the complaint in this matter as soon as practicable prior to the February 9, 2011 hearing date. Mr. Sheehan is lead counsel for Irving Picard and a partner at Baker & Hostetler LLP, the court-appointed counsel for the Trustee. Mr. Picard is the trustee for Bernard L. Madoff Investment Securities LLC. "We write to inform Your Honor that the defendants do not oppose the pending motions and, therefore, agree that the complaint should be unsealed immediately," Ms. Wagner said in the letter. "As Your Honor is aware, the complaint was filed by the Trustee under seal to further settlement discussions. Those discussions have ended in the wake of a series of events that stemmed from the actions of "two lawyers involved in the case" who, in conjunction with The New York Times, took it upon themselves to violate this Court's orders and to disclose confidential information that is either in the complaint or was otherwise provided or discussed in confidence. As a result, one-sided and misleading information was publicly disseminated, both about the complaint and the defendants. These leaks resulted in a media storm to which we were forced to respond. At no point did we respond to repeated questions about the content of the complaint." According to Ms. Wagner, the defendants have strong objection to the "heated rhetoric and unfounded conclusions" in the complaint. Further, many of the key allegations are made "upon information and belief," even though they are contrary to the factual record developed by the Trustee in his pre-complaint discovery. "Nevertheless, the objective of keeping the complaint sealed are no longer being served, so defendants consent to its immediate unsealing," Ms. Wagner said. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) As of October 29, 2010, a total of US$5.69 billion in claims by investors has been allowed, with US$741.2 million to be paid by the Securities Investor Protection Corp. Investors are expected to receive additional distributions from money recovered by Mr. Picard from lawsuits or settlements. BLOCKBUSTER INC: Summit Wants Case Converted to Chapter 7 --------------------------------------------------------- Blockbuster Bankruptcy News reports that Summit Distribution LLC is the U.S. Bankruptcy Court for the Southern District of New York to compel the Debtors to immediately pay its administrative expense claim pursuant to Sections 105(a), 363(b) and 503(b) of the Bankruptcy Code, or in the alternative, grant it relief from the automatic stay to permit reclamation of its goods and converting the Chapter 11 cases to cases under Chapter 7 of the Bankruptcy Code for "cause." In reliance on prior orders of the Court and assurances of payment by the Debtors, Summit shipped its second largest title of the year, "The Twilight Saga: Eclipse," and several other titles to the Debtors on 60-day credit terms, Paul N. Silverstein, Esq., at Andrews Kurth LLP, in New York -- paulsilverstein@andrewskurth.com -- tells the Court. He asserts that in the absence of those protections and assurances, Summit could have and would have sold and licensed its product elsewhere. The first payment with respect to the shipment of "Eclipse," which alone equal to more than $1.6 million, became due last week, and the Debtors failed to pay, Mr. Silverstein says. He adds that the Debtors informed Summit that they would not pay Summit with respect to products that were shipped postpetition because they lacked the funds to do so. Summit's current undisputed past-due postpetition receivable is $6,788,214 and the outstanding amount owed to Summit for all postpetition shipments totals $9,510,114, Mr. Silverstein informs the Court. He asserts that needless to say, this is a very significant amount for an independent film distributor. "It is unfair and inconsistent with the fundamental tenets of [C]hapter 11 of the Bankruptcy Code for the Debtors to be permitted to breach their undisputed postpetition obligations to Summit, while picking and choosing to pay other administrative creditors in full and continuing to increase the administrative insolvency of these cases," Mr. Silverstein argues. Summit believes that either (i) the Debtors should be compelled to pay Summit in full with respect to the undisputed obligations in accordance with the Court's prior order and the agreements between the parties, or (ii) Summit should be granted relief from stay and permitted to reclaim its goods so that it can mitigate the harm the Debtors have caused and the Debtors' Chapter 11 cases should be converted to Chapter 7, so that a trustee may ensure that all creditors are treated fairly and consistently. About Blockbuster Inc. Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA, BLOKB) -- http://www.blockbuster.com/-- is a global provider of rental and retail movie and game entertainment. It has a library of more than 125,000 movie and game titles. Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan on September 23, 2010 (Bankr. S.D.N.Y. Case No. 10-14997). It disclosed assets of $1 billion and debts of $1.4 billion at the time of the filing. Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. A steering group of senior secured noteholders is represented by James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin LLP. U.S. Bank National Association as trustee and collateral agent for the senior secured notes is represented by David McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter & Hampton LLP. BDO Consulting is the financial advisor for U.S. Bank. Lenders led by Wilmington Trust FSB are providing the DIP financing. The DIP Agent is represented by Peter Neckles, Esq. and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York. The Official Committee of Unsecured Creditors has retained Cooley LLP as its counsel. Blockbuster's non-U.S. operations and its domestic and international franchisees, all of which are legally separate entities, were not included in the filings and are not parties to the Chapter 11 proceedings. In its latest monthly operating report filed with the Bankruptcy Court, Blockbuster disclosed $1.066 billion in assets, $422.2 million in liabilities not subject to compromise and $1.165 billion in liabilities subject to compromise, and a deficit of $533.8 million as of Nov. 28, 2010. Bankruptcy Creditors' Service, Inc., publishes BLOCKBUSTER BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Blockbuster Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) BRAEWOOD RESIDENTIAL: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Braewood Residential, LP 105 Eldorado Pkwy Little Elm, TX 75068 Bankruptcy Case No.: 11-40380 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Judge: Brenda T. Rhoades Debtor's Counsel: Joyce W. Lindauer, Esq. 8140 Walnut Hill Lane, Suite 301 Dallas, TX 75231 Tel: (972) 503-4033 Fax: (972) 503-4034 E-mail: courts@joycelindauer.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 Brett Cochran, president. BROWN'S FAMILY: 2 Restaurants Remain Open; Third Closed ------------------------------------------------------- G.G. Rigsby at the Savannah Morning News reports that the restaurant operated by Sisters of the New South II, Inc., has been closed while each restaurant operated by The Brown's Family Restaurant of Savannah LLC and Sisters of the New South, Inc., remains open. According to the report, Kenneth Brown and his wife, Vicky, filed Chapter 11 petitions for the three restaurants, disclosing: Debtor Assets Liabilities ----- ------ ----------- Brown's Family Restaurant $6,850 $41,000 Sisters of the New South $18,300 $86,000 Sisters of the New South II $7,060 $39,000 Georgia Department of Revenue is owed $114,000 in withholding and sales taxes in the aggregate, according to the report. The Brown's Family Restaurant of Savannah LLC filed a chapter 11 petition (Bankr. S.D. Ga. Case No. 11-40128) on January 19, 2011. Sisters of the New South, Inc. (Bankr. S.D. Ga. Case No. 11-40129) and Sisters of the New South II, Inc., (Case No. 11-40130) filed separate Chapter 11 petitions on the same day. A copy of Brown's Family's petition is available at: http://bankrupt.com/misc/gasb11-40128.pdf A copy of Sisters of the New South's petition is available at: http://bankrupt.com/misc/gasb11-40129.pdf CAPITAL GROWTH: May Consummate Sale Transaction With Pivotal Group ------------------------------------------------------------------ In a regulatory filing Tuesday, Capital Growth Systems, Inc., discloses that on January 27, 2011, the U.S. Bankruptcy Court for the District of Delaware entered an order approving the sale of substantially all of the assets of Global Capacity to Pivotal Global Capacity, LLC, or its subsidiary, GC Pivotal, LLC, an affiliate of Pivotal Group, Inc. Pivotal had previously acquired 100% of the secured debt of Global Capacity. As reported in the Troubled Company Reporter on January 21, 2011, the Pivotal Group acquired $65 million of Global Capacity's debt, putting the investment firm back in position to lead the telecommunications information and logistics company out of bankruptcy after a prior proposed sale fell apart. Global Capacity and Pivotal have now commenced seeking the federal and state telecom regulatory approvals necessary to effect a transfer of the assets and assumption of telecom services by Pivotal, and estimate completion of the process by April 30, 2011. The sale is to close after regulatory approvals are obtained. The assets being acquired include all shares of non-debtor Magenta netLogic Limited, UK, or alternatively all of that entity's assets will be transferred to the Debtors in exchange for a release of inter-company debt before the Sale closing. The sale of the assets to Pivotal will be effected pursuant to an Amended Asset Purchase Agreement in the form attached below, and as may be amended to incorporate: (i) the terms of the Sale Order, to the extent it supersedes the foregoing, and (ii) certain agreements with parties to executory contracts being addressed in follow-up stipulations and orders. It contemplates the purchase of substantially all of the Debtors' assets for a purchase price not to exceed $28,643,000, comprised of: (i) approximately $10,983,000, representing credit against the amount of estimated indebtedness on the debtor in possession facility through the closing date; (ii) not more than $8,660,000 representing sums necessary to fund cure amounts (including payments to mission critical vendors for certain pre-petition liabilities) and to fund priority claims and administrative expenses of the Debtors' estate, including professional fees and amounts needed to wind down the estates; and (iii) $9,000,000 representing a credit bid amount against pre-petition secured loans; plus also the undertaking of Pivotal to assume certain agreed upon assumed liabilities of the Debtors. The APA contemplates the retention of certain retained causes of action by the Debtors. The Sale Order also addressed the settlement of certain of the larger mission critical vendor claims and provided for later resolution of certain remaining outstanding claims and contract assumption issues. A full-text copy of the Sale Order is available for free at: http://researcharchives.com/t/s?72c8 A full-text copy of the Amended Asset Purchase Agreement is available for free at: http://researcharchives.com/t/s?72c9 About Capital Growth Headquartered in Chicago, Illinois, Capital Growth Systems, Inc., known as Global Capacity, and its subsidiaries operate in one reportable segment as a single source telecom logistics provider in North America and the European Union. The Company helps customers improve efficiency, reduce cost, and simplify operations of their complex global networks -- with a particular focus on access networks. Capital Growth Systems and its affiliates filed for Chapter 11 protection on. The lead debtor is Global Capacity Holdco LLC (Bankr. D. Del. Case No. 10-12302). Global Capacity Group Inc. estimated $10 million to $50 million in assets and debts in its petition. CB HOLDING: Selling Another Liquor License for $250,000 ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the owner of Charlie Brown's Steakhouse is selling another liquor license. Shack Foods of Dedham LLC is offering $250,000 for a license in Dedman, Massachusetts. The Company wants the sale approved at a March 9 hearing without holding an auction. About CB Holding New York-based CB Holding Corp. had 20 Charlie Brown's Steakhouse, 12 Bugaboo Creek Steak House, and 7 The Office Beer Bar and Grill restaurants when it filed for bankruptcy protection. The Company closed 47 locations before filing for Chapter 11. Following a bankruptcy auction, it sold its The Office restaurant chain to winning bidder Villa Enterprises Ltd. for $4.68 million. CB Holding and its affiliates filed for Chapter 11 bankruptcy protection on November 17, 2010 (Bankr. D. Del. Case No. 10-13683). Christopher M. Samis, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., assist the Debtors in their restructuring effort. The Garden City Group, Inc., is the Debtors' notice, claims and solicitation agent. Jeffrey N. Pomerantz, Esq., Jason S. Pomerantz, Esq., and Bradford J. Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Official Committee of Unsecured Creditors. CB Holding estimated its assets at $100 million to $500 million and debts at $50 million to $100 million. CENTAUR LLC: Reaches $8.5-Million Deal With Churchill Downs ----------------------------------------------------------- Bankruptcy Law360 reports that Centaur LLC has agreed to pay Churchill Downs Inc. $8.5 million to settle Churchill's claims related to a contract for the sale of Hoosier Park Racing & Casino in Anderson, Indiana. About Centaur LLC Indianapolis, Indiana-based, Centaur, LLC, aka Centaur Indiana, LLC -- http://www.centaurgaming.net/-- is involved in the development and operation of entertainment venues focused on horse racing and gaming. The Company and its affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 10- 10799) on March 6, 2010. The Company estimated its assets and debts at $500 million to $1 billion as of the Petition Date. A group of affiliates led by Valley View Downs, LP, filed for Chapter 11 protection (Bankr. D. Del. Case No. 09-13761) on October 28, 2009. Valley View estimated assets and debts at $100 million to $500 million in its Chapter 11 petition. Gerard H. Uzzi, Esq., Michael C. Shepherd, Esq., and Lane E. Begy, Esq., at White & Case LLP, serve as counsel to the Debtors. AlixPartners, LLP, is the claims and notice agent. Blackstone Advisory Partners L.P. and Innovation Capital, LLC, serve as financial advisors to the Debtors. Attorneys at Blank Rome LLP represent the Official Committee of Unsecured Creditors. Lamonica Herbst & Maniscalco and Flaster/Greenberg P.C. serve as special counsel to the Committee. Deloitte Financial Advisory Services LLP is the financial advisor to the Committee. CENTRAL LEASING: Files Schedules of Assets & Liabilities -------------------------------------------------------- Central Leasing Co. of NJ, LLC, has filed with the U.S. Bankruptcy Court for the District of New Jersey its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities --------------- ------ ----------- A. Real Property $0 B. Personal Property $12,212,082 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $10,205,926 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $23,649 ----------- ----------- TOTAL $12,212,082 $10,229,575 A copy of the Schedules of Assets and Liabilities is available for free at http://bankrupt.com/misc/CENTRAL_LEASING_sal.pdf Midland Park, New Jersey-based Central Leasing Co. of NJ, LLC, filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. N.J. Case No. 11-11917). Michael J. Muller, Esq., at Michael J. Muller, Esq. NJ, serves as the Debtor's bankruptcy counsel. CENTRAL LEASING: Section 341(a) Meeting Scheduled for Feb. 23 ------------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of Central Leasing Co. of NJ, LLC's creditors on February 23, 2011, at 11:00 a.m. The meeting will be held at Office of the US Trustee, Raymond Blvd., One Newark Center, Suite 1401, Newark, NJ 07102-5504. 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. Midland Park, New Jersey-based Central Leasing Co. of NJ, LLC, filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. N.J. Case No. 11-11917). Michael J. Muller, Esq., at Michael J. Muller, Esq. NJ, serves as the Debtor's bankruptcy counsel. In its schedules, the Debtor disclosed $12,212,081 in total assets and $10,229,574 in total liabilities. CLOVERLEAF ENTERPRISES: Penn Ups Bid to $11MM; Court OKs Sale ------------------------------------------------------------- The Baltimore Sun's Hanah Cho reports that Judge Paul Mannes approved on Wednesday the sale of Rosecroft Raceway to casino operator Penn National Gaming for $11 million in cash over the objection of a group led by former state Democratic Party Chairman Nathan Landow. The Baltimore Sun reports that Wednesday's hearing essentially turned into another auction with last-minute maneuvering, as both parties upped their bids for the harness track before Penn National made its final $11 million cash-only offer. At last week's auction, Penn National emerged as the winning bidder with its $10.25 million cash offer, plus $3 million if the General Assembly approves a bond issue funded by slots revenue to help finance the track's operations to resume live racing. Landow Partners objected to Penn National's bid, contending that the Rosecroft bankruptcy trustee did not properly value two items that were part of its $10.05 million cash offer. Landow Partners offered $3 million for a similar bond issue and another $3 million if a referendum to expand gambling is approved in the state and slots become operational at Rosecroft. According to The Baltimore Sun, at Wednesday's hearing, Landow matched Penn's $10.25 million cash offer and offered to pay an added $200,000 cash if the state does not approve the bond issue. The payment for slots remained the same. Ther report says Penn restated its cash offer while matching the $3 million bond payment and adding a $6 million premium if slots become operational at the racetrack. After a lunch break, Penn revised its offer to a cash-only bid of $11 million and took the $9 million bond and slots payments off the table. The report relates that the bankruptcy trustee as well as the Maryland Thoroughbred Horsemen's Association and the Maryland Horse Breeders Association, which are the track's largest unsecured creditors in the bankruptcy, supported Penn's new bid. The Baltimore Sun also notes Democratic state Sen. C. Anthony Muse provided testimony at the hearing in support of Landow Partners' bid, saying Landow would have the backing of the community and local and state lawmakers, especially when it comes to expanding gambling at the facility. The report notes that, besides resuming live racing at Rosecroft, Penn plans to lobby for slots at the racetrack, which is not one of the five locations designated for slots under the state's gambling program. Such a change would require a voter referendum amending the Maryland Constitution. According to the report, Mr. Muse said he would not support Penn's effort, or any effort, to legalize slots at the racetrack. But Mr. Muse, whose bill that would have allowed card games at Rosecroft failed last year, said he would support efforts to try again if the matter were pursued by the Landow group. Landow Partners' principals include a former Rosecroft chief financial officer and a racing executive at Hoosier Park in Indiana. It will have 14 days to appeal the judge's ruling. COACH AMERICA: May Need "Restructuring", Cut by Moody's to 'Caa1' ----------------------------------------------------------------- Moody's Investors Service lowered Coach America's Corporate Family Rating and Probability of Default Rating to Caa1 and Caa3, respectively from B3. The Caa1 CFR incorporates the expectation of continued high leverage and weak credit metrics due to ongoing softness in macroeconomic conditions including persistent high single-digit unemployment levels. The Caa3 PDR reflects the increased likelihood that the company might have to enter into a restructuring due to the inability to meet current covenant threshold requirements and the need for funding to cover maintenance-related capital expenditures. The outlook is negative. These actions conclude the review for possible downgrade initiated on August 2, 2010. Ratings Rationale The CFR of Caa1 considers Coach America's continuing highly levered capital structure, very weak EBIT to interest coverage (under one times) and negative free cash flow. The company's performance has been lower than Moody's had anticipated. Although Moody's notes that the company has a well positioned business model, it is in a cyclical industry currently under duress and continues to carry the onerous debt burden taken on in 2007 when the company was bought by its current equity sponsor. Moody's expects that the company's financials are likely to remain depressed throughout the intermediate term notably given the ongoing economic malaise combined with anticipated required capital investments. More positively, Moody's acknowledges that prior to the slowdown in domestic economic activity, the company proactively managed its cost structure. Additionally, Coach America's revenue base benefits from high proportions of contracted or chartered business. The company also maintains strong market positions in its markets. Nonetheless, the lack of free cash flow available to pay down debt limits Coach America's ability to meaningfully reduce elevated debt coverage metrics. The negative outlook reflects Moody's views that liquidity is weak and that a restructuring may be needed in the very near term. The ratings would be subject to downward pressure if the company's margins were to deteriorate, if volumes were to further decline, or if the liquidity profile were to worsen. Credit metrics that would likely accompany the aforementioned include: debt/EBITDA above 7.0 times, EBITA to interest below 0.5x and persistent negative free cash flow. The outlook could be stabilized if there is sustained improvement in Coach America's liquidity profile affording the company ample headroom going forward. Although less likely in the near term, positive momentum could result from sustained free cash flow generation, permanent debt reduction (i.e. Debt to EBITDA sustained below 6.0 times and EBIT to Interest sustained above 1.0 times). Ratings downgraded (LGD assessments subject to change): * Corporate Family to Caa1 from B3 * Probability of Default to Caa3 from B3 * $30 million 1st lien revolving credit facility due 2013, to Caa1 (LGD-3, 44%) from B2 (LGD-3, 40%) * $50 million 1st lien letter of credit facility due 2014, to Caa1 (LGD-3, 44%) from B2 (LGD-3, 40%) * $195 million 1st lien term loan due 2014, to Caa1 (LGD-3, 44%) from B2 (LGD-3, 40%) * $50 million 1st lien delayed draw term loan due 2014, to Caa1 (LGD-3, 44%) from B2 (LGD-3, 40%) * $55 million 2nd lien term loan due 2014, to Caa3 (LGD-6, 90%) from Caa2 (LGD-5, 88%) The last rating action on Coach America took place on August 2, 2010, at which time the ratings were put under review for possible downgrade. For further information please refer to the credit opinion to be posted on moodys.com. Coach America Holdings, Inc., headquartered in Dallas, Texas, is a charter bus operator and motorcoach services provider in the United States. The company had fiscal year 2010 revenues of approximately $417 million. CONSTAR INTERNATIONAL: Court OKs Key Financing Agreements --------------------------------------------------------- Constar International Inc. disclosed that on Tuesday, the U.S. Bankruptcy Court for the District of Delaware granted final approval of the Company's $55 million debtor-in-possession financing. The Company previously received interim approval of the DIP financing facility from the Court on January 13, 2011. The Company also announced that, on Feb. 1, the U.S. Bankruptcy Court for the District of Delaware granted authorization for the Company to enter into a Commitment Letter with Wells Fargo Capital Finance, LLC for a $60 million Senior Secured Asset-Based Revolving Loan Facility for exit financing. Grant H. Beard, President and Chief Executive Officer of Constar, commented, "The Court's approval of our DIP financing and permission to execute an exit financing agreement are significant steps in our reorganization process that enable the Company to continue to operate as usual. We appreciate the ongoing support of our loyal customers, committed suppliers and dedicated employees as we progress with our plans to quickly emerge from the reorganization process." Note Purchase Agreement BankruptcyData.com reports that the agreements approved by the U.S. Bankruptcy Court on Tuesday include a a postpetition note purchase agreement under which noteholders will convert 100% of the face amount of the current notes into new term debt in the face amount of $70 million and convertible preferred stock of $30 million, making them the majority owners of the new common stock. Dow Jones' DBR Small Cap reports that existing noteholders, led by Black Diamond Commercial LLC, are purchasing $55 million in super- priority secured notes. DBR says that the proceeds of the notes will not only fund Constar's continued operations in bankruptcy, but will also allow the Company to pay off its existing revolving credit facility. Lender General Electric Capital Corp. was owed $15.8 million as of Jan. 4, the report adds. About Constar International Philadelphia, Pennsylvania-based Constar International Inc. -- http://www.constar.net/-- produces and supplies polyethylene terephthalate plastic containers for food and beverages. Constar filed for Chapter 11 protection in December 2008 (Bankr. D. Del. Lead Case No. 08-13432), with a pre-negotiated Chapter 11 plan. The plan, which reduced Constar's debt load by roughly $175 million, became effective on May 29, 2009. Attorneys at Bayard P.A., and Wilmer Cutler Pickering Hale and Dorr LLP represented the Debtor in the case. Due to operating losses caused by a significant decline in demand for its products from Pepsi-Cola Advertising and Marketing Inc. and other customers, Constar and its affiliates returned to Chapter 11 on January 11, 2011 (Bankr. D. Del. Case No. 11-10109), with a Chapter 11 plan negotiated with holders of 75% of the holders of $220 million in senior secured floating-rate notes. Andrew Goldman, Esq., and Dennis Jenkins, Esq., at Wilmer Cutler Pickering Hale and Dorr LLP, serve as the Debtors' general bankruptcy counsel. Jamie Lynne Edmonson, Esq., and Neil B. Glassman, Esq., at Bayard, P.A., serve as co-counsel to the Debtors. PricewaterhouseCoopers serves as the Debtors' independent auditors and accountants. Kurtzman Carson Consultants LLC serves as the Debtors' claims agent. Patrick J. Nash Jr., Esq., and Paul Wierbicki, Esq., at Kirkland & Ellis LLP, serve as counsel to the noteholders that have signed that plan support agreement. The Debtors disclosed $418 million in total assets and $414 million in total debts as of Sept. 30, 2010. CONTESSA PREMIUM: Schedules and Statements Now due March 11 ----------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California extended, at the behest of Contessa Premium Foods, Inc., the deadline for the filing of schedules of assets and liabilities and statement of financial affairs until March 11, 2011. The SAL and SOFA were initially due on February 9, 2011. but the Debtor said that it won't be able to file the documents by the 14- day period provided by F.R.B.P. Rule 1007(c) because of the "demands on the case." The Debtor noted that it has over 500 creditors, 300 employees, and is a party to numerous contracts, leases, licenses, and other agreements, all of which make it very time consuming for the Debtor's accounting department to compile the requisite information necessary to ensure that accurate and complete Schedules are filed. About Contessa Premium Foods San Pedro, California-based Contessa Premium Foods, Inc., fka ZB Industries, Inc., and Contessa Food Products, Inc., provides farm raised shrimp, convenience meals, stir-fry vegetables, and other frozen food products that are marketed and sold primarily in the United States and to a lesser extent in Canada, Europe, Asia, and Mexico. It divides its business into two internal groups: Contessa Seafood, which includes its seafood items, and Contessa "Green Cuisine," which includes all other fruit, vegetable and complete meal blends. Contessa Premium filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. C.D. Calif. Case No. 11-13454). Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, and Jeffrey W. Dulberg, Esq., and Scotta E. McFarland, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $50 million to $100 million. CONTESSA PREMIUM: Gets Court's Interim Nod to Use Cash Collateral ----------------------------------------------------------------- Contessa Premium Foods, Inc., sought and obtained interim authorization from the U.S. Bankruptcy Court for the Central District of California to use cash collateral until April 29, 2011. As of the Petition Date, the Debtor owes Wells Fargo Bank, National Association, $17,050,000, secured by the Debtor's property, including cash generated by the property. Jeffrey W. Dulberg, Esq., at Pachulski Stang Ziehl & Jones LLP, explained that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a weekly budget, a copy of which is available for free at: http://bankrupt.com/misc/CONTESSA_PREMIUM_budget.pdf In exchange for using the cash collateral, Wells Fargo is granted a valid, perfected and enforceable security interest in and upon all of the assets of the Debtor in which in which it had a security interest prior to the Petition Date and hereby created after the Petition Date. Wells Fargo is also granted an administrative claim o the extent of any diminution in the value of the collateral, which will have priority in the Debtor's bankruptcy case. As additional adequate protection, the Debtor will pay Wells Fargo cash payments of interest at the rate in effect as of the Petition Date and at the times required under the Debtor's prepetition credit agreement with Wells Fargo. The Court has set a final hearing for March 9, 2011, on the Debtor's request to use cash collateral. About Contessa Premium Foods San Pedro, California-based Contessa Premium Foods, Inc., fka ZB Industries, Inc., and Contessa Food Products, Inc., provides farm raised shrimp, convenience meals, stir-fry vegetables, and other frozen food products that are marketed and sold primarily in the United States and to a lesser extent in Canada, Europe, Asia, and Mexico. It divides its business into two internal groups: Contessa Seafood, which includes its seafood items, and Contessa "Green Cuisine," which includes all other fruit, vegetable and complete meal blends. Contessa Premium filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. C.D. Calif. Case No. 11-13454). Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, and Jeffrey W. Dulberg, Esq., and Scotta E. McFarland, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $50 million to $100 million. CONTESSA PREMIUM: Section 341(a) Meeting Scheduled for March 10 --------------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of Contessa Premium Foods, Inc.'s creditors on March 10, 2011, at 11:00 a.m. The meeting will be held at Room 2610, 725 S Figueroa Street, Los Angeles, CA 90017. 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. About Contessa Premium Foods San Pedro, California-based Contessa Premium Foods, Inc., fka ZB Industries, Inc., and Contessa Food Products, Inc., provides farm raised shrimp, convenience meals, stir-fry vegetables, and other frozen food products that are marketed and sold primarily in the United States and to a lesser extent in Canada, Europe, Asia, and Mexico. It divides its business into two internal groups: Contessa Seafood, which includes its seafood items, and Contessa "Green Cuisine," which includes all other fruit, vegetable and complete meal blends. Contessa Premium filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. C.D. Calif. Case No. 11-13454). Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, and Jeffrey W. Dulberg, Esq., and Scotta E. McFarland, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $50 million to $100 million. CRESCENT RESOURCES: Gets Raleigh Nod for Residences at Cameron -------------------------------------------------------------- David Bracken at News & Observer reports that Crescent Resources, which emerged from bankruptcy in June 2010, obtained approval from the Raleigh city council for the site plan for the Residences at Cameron Village. The report relates that Crescent Resources expects to secure financing for the $45 million project by April and start construction in early May, with the first apartments being completed in the third quarter of 2012. The Residences at Cameron Village is a project that would place 282 apartments, 16,000 square feet of retail and a 450-space parking deck on one of the most visible corners in central Raleigh, North Carolina. About Crescent Resources Crescent Resources, LLC -- http://www.crescent-resources.com/-- is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Crescent Resources is a joint venture between Duke Energy and Morgan Stanley Real Estate Fund. Established in 1969, Crescent creates mixed-use developments, country club communities, single-family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Crescent Resources, LLC, and its debtor-affiliates filed for Chapter 11 protection (Bankr. W.D. Tex. Lead Case No. 09-11507) on June 10, 2009. Judge Craig A. Gargotta presided over the case. Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., served as the Debtors' bankruptcy counsel. Crescent Resources' plan of reorganization was confirmed by the Court on May 24, 2010. It successfully completed its financial restructuring and emerged from Chapter 11 on June 9, 2010. CRESTRIDGE ESTATES: Creditor Can Pursue Rights on Property ---------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California denied Crestridge Estates, L.L.C.'s request to extend the automatic stay re-imposed until January 19, 2011. Previously, First-Citizens Bank & Trust was stayed to pursue its rights on the real property located at 5601 Crestridge Road, Rancho Palos Verdes, California. First-Citizens may now enforce its remedies to foreclose upon and obtain possession of the property in accordance with applicable non-bankruptcy law, but may not pursue any deficiency claim against the Debtor or property of the estate except by filing a proof of claim. Disclosure Statement The Court also denied approval of the Debtor's Disclosure Statement explaining its proposed Plan of Reorganization. The Plan proposed by the Debtor contemplates the Debtor continuing operating the business and liquidating certain assets, with $375,000 funding from existing equity holder The 2005 John D. Thomas Trust. The undeveloped land located in Rancho Palos Verdes, California, upon completion of the entitlements, was valued by the Plan at $25,000,000. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/CRESTRIDGEESTATES_DS.pdf About Crestridge Estates, LLC Costa Mesa, California-based Crestridge Estates, LLC, filed for Chapter 11 bankruptcy protection on March 24, 2010 (Bankr. C.D. Calif. Case No. 10-13689). The Company estimated assets and debts at $10 million to $50 million. The Company's affiliate, 468 Ashton LLC, filed a separate Chapter 11 petition on August 29, 2008 (Case No. 08-15323). The Debtor is represented by David B. Golubchik, Esq., and Lindsey L. Smith, Esq., at Levene, Neale, Bender, Rankin & Brill L.L.P., in Los Angeles, California. First-Citizens is represented by: David K. Eldan, Esq. PARKER, MILLIKEN, CLARK, O'HARA & SAMUELIAN 555 S. Flower St., 30th Floor Los Angeles, CA 90071-2440 Tel: (213) 683-6500 Fax: (213) 683-6669 E-mail: deldan@pmcos.com CUMULUS MEDIA: S&P Gives Positive Outlook, Affirms 'B-' Rating -------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on Atlanta, Ga.-based radio broadcaster Cumulus Media Inc. to positive from stable. All ratings on the company, including the 'B-' corporate credit rating, were affirmed. "The positive outlook revision reflects the asset and cash flow diversification benefits that Cumulus will gain in acquiring Cumulus Media Partners LLC," said Standard & Poor's credit analyst Andy Liu. CMP is the owner of CMP Susquehanna Radio Holdings Corp. (also rated 'B-' with a positive outlook), which owns and operates 32 radio stations in nine markets, including four of the top 10 U.S. markets. In contrast, Cumulus owns and operates 314 radio stations in 59 midsize markets in the U.S. The transaction will also enhance Cumulus' ability to refinance its debt capital structure, likely in 2012. Cumulus is acquiring CMP in an all-stock transaction, and the two companies' existing credit facilities will stay in place. In other words, pro forma for the transaction, Cumulus will have two separate debt capital structures. S&P's ratings on CMP Susquehanna are unaffected by the announcement, and if the proposed transaction is completed, S&P would expect to view the corporate credit ratings on a consolidated basis. Under this scenario, issue-level and recovery ratings would not be consolidated, reflecting the separate capital structures, security packages, and recovery prospects. The transaction will not increase total debt outstanding, and S&P expects it to be completed in the second quarter of 2011. Pro forma combined debt leverage as of Sept. 30, 2011, was 8.2x. The 'B-' rating reflects S&P's view that Cumulus Media Inc. will be under pressure to meet its debt leverage maintenance covenant when the covenant is reinstated in the reporting period ending March 2011. Debt leverage calculated per the credit agreement was high at 7.4x as of Sept. 30, 2010. S&P believes debt leverage will continue to decrease between now and March 31, 2011. S&P also believes the company will be able to afford the costs associated with an amendment or waiver should it need one, based on its improving operating performance and cash flow. Its high debt leverage and weak cushion of covenant compliance underlie S&P's assessment of its financial risk profile as highly leveraged. S&P considers Cumulus' business profile as weak, due to competition from alternative media, secular declines in the radio industry, and pricing pressures. Additionally, radio advertising is highly cyclical. This adds a degree of volatility to company's business performance beyond its control. On the positive side, the company's EBITDA margin is relatively high, in the low-30% area. DBSD N.A.: Creditors to Have Enhanced Recovery Under Dish Plan -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York will convene a hearing on Feb. 15 to bind DBSD North America Inc. to its new agreement with Dish Network Inc. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that DBSD is filing a new plan based upon a deal for Dish Network to acquire all of the new stock of DBSD at a cost of about $1 billion. The agreement requires DBSD to file a new plan by Feb. 28. Mr. Rochelle relates that Dish Network has also agreed to repay financing for the Chapter 11 case and provide $23.5 million in cash for payment to holders of general unsecured claims. Dish must also cover other claims that must be paid in full, such as administrative and priority claims. DBSD said in a court filing that the Dish offer results in a valuation of the reorganized company that is 150% of the valuation under the Company's own plan. The new plan, DBSD says, will provide an "enhanced" recovery for unsecured creditors. $1 Billion Deal with DISH Network As reported in the Feb. 2, 2011 edition of the Troubled Company Reporter, DISH Network said it has entered into an agreement to acquire 100% of the equity of the reorganized DBSD N.A. for approximately $1 billion subject to certain adjustments, including interest accruing on DBSD North America's existing debt. DISH Network is also committing to provide a debtor-in-possession credit facility to DBSD in connection with filings under Chapter 11 of the U.S. Bankruptcy Code. The credit facility, which remains subject to approval by the Bankruptcy Court, will consist of a non-revolving, multiple draw term loan in the aggregate principal amount of $87.5 million. This transaction is to be completed upon satisfaction of certain conditions, including approval by the Federal Communications Commission and DBSD North America's emergence from bankruptcy. About DISH Network DISH Network Corporation -- http://www.dish.com/-- through its subsidiary DISH Network L.L.C., provides more than 14.2 million satellite TV customers, as of September 30, 2010, with the highest quality programming and technology at the best value, including HD Free for Life. Subscribers enjoy industry-leading customer satisfaction, the largest high definition line-up with more than 200 national HD channels, the most international channels, and award-winning HD and DVR technology. About DBSD North America Headquartered in Reston, Virginia, DBSD North America Inc., aka ICO Member Services Inc., offers satellite communications services. It has launched a satellite, but is in the developmental stages of creating a satellite system with components in space and on earth. It presently has no revenues. The Company and nine of its affiliates filed for Chapter 11 protection on May 15, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-13061). James H.M. Sprayregen, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, in New York; and Marc J. Carmel, Esq., and Sienna R. Singer, Esq., at Kirkland & Ellis LLP, in Chicago, serve as the Debtors' counsel. Jefferies & Company is the financial advisors to the Debtors. The Garden City Group Inc. is the claims agent for the Debtors. DBSD estimated assets and debts of $500 million to $1 billion in its Chapter 11 petition. DENNY'S CORP: CFO and CEO Named to Board of Directors ----------------------------------------------------- Denny's Corporation appointed Chief Financial Officer Mark F. Wolfinger to its Board of Directors, effective January 26, 2011. The Company also appointed newly hired President and Chief Executive Officer, John C. Miller to the Board of Directors, effective February 1, 2011. Mr. Wolfinger currently serves as Executive Vice President, Chief Administrative Officer and Chief Financial Officer. Mr. Wolfinger is responsible for the overall financial direction of the company in addition to overseeing the Development, Information Technology, Purchasing and Legal functions. Mr. Wolfinger joined Denny's in September 2005 and has been instrumental in helping to strengthen the brand and solidify the company's capital structure. Brenda Lauderback, chair of Denny's Corporate Governance and Nominating Committee, stated, "Mark has proven through his contributions and increasing responsibilities over the past six years to be a significant asset to Denny's and we look forward to adding his expertise, judgment and insight to the Board. Among his many meaningful contributions, Mark has led our successful Franchise Growth Initiative which has transformed Denny's business model to a more heavily franchised system, he has strengthened the Company's capital structure, and most recently he spearheaded our strong development effort that resulted in the opening of more new domestic restaurants in 2010 than in any year in the brand's 57 year history." About Denny's Corporation Based in Spartanburg, South Carolina, Denny's Corporation (NASDAQ: DENN) -- http://www.dennys.com/-- Denny's is one of America's largest full-service family restaurant chains, consisting of 1,348 franchised and licensed units and 232 company-owned units, with operations in the United States, Canada, Costa Rica, Guam, Mexico, New Zealand and Puerto Rico. The Company's balance sheet at Sept. 29, 2010, showed $312.67 million in total assets, $415.10 million in total liabilities, and a stockholders' deficit of $102.42 million. Denny's carries 'B2' corporate family and probability of default ratings from Moody's Investors Service and a 'B+' corporate credit rating from Standard & Poor's. DYNEGY INC: Habrok Capital Holds 5.6% Equity Stake -------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on January 31, 2011, each of Habrok Capital Management LLP and Christian Kvaal Leif disclosed beneficial ownership of 6,795,000 shares of common stock of Dynegy Inc. representing 5.6% of the shares outstanding. As of November 1, 2010, there were 120,894,257 shares of common stock outstanding. Habrok Management, which serves as the investment manager to the Funds, may be deemed to be the beneficial owner of the shares of Common Stock held by the Funds. Mr. Kvaal, who serves as Senior Partner and Chief Executive Officer of Habrok Management, may be deemed to be the beneficial owner of the shares of Common Stock held by the Funds. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE:DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. The Troubled Company Reporter has chronicled Dynegy's attempts to sell itself. In August 2010, Dynegy struck a deal to be acquired by an affiliate of The Blackstone Group at $4.50 a share or roughly $4.7 billion. That offer was raised to $5.00 a share in November. Through Icahn and Seneca's efforts, shareholders thumbed down both offers. On December 22, 2010, an affiliate of IEP commenced a tender offer to purchase all of the outstanding shares of Dynegy common stock for $5.50 per share in cash, or roughly $665 million in the aggregate. Goldman, Sachs & Co. and Greenhill & Co., LLC, are serving as financial advisors and Sullivan & Cromwell LLP is serving as legal counsel to Dynegy. At Sept. 30, 2010, Dynegy had $11.121 billion in total assets, $8.231 billion in total liabilities, and $2.890 billion in stockholders' equity. * * * As reported by the Troubled Company Reporter on November 26, 2010, Fitch Ratings downgraded the ratings of Dynegy Inc. and its subsidiaries: Dynegy Inc. Issuer Default Rating to 'CCC' from 'B-'; Dynegy Holdings, Inc. IDR to 'CCC' from 'B-'; Secured bank credit facilities and notes to 'B+/RR1' from BB-/RR1; Senior unsecured to 'CCC/RR4' from 'B/RR3'; and Dynegy Capital Trust I preferred to 'C/RR6' from 'CCC/RR6'. The downgrade reflects Fitch's belief that the rejection of The Blackstone Group's bid to acquire Dynegy for $5/share will likely lead to another transaction and capital restructuring by Dynegy's management as activist stockholders seek to maximize shareholder values. The downgrade also reflects the underperformance of Dynegy's merchant generation operations. In October 2010, Moody's Investors Service lowered the ratings of Dynegy Holdings, including its Corporate Family Rating, to 'Caa1' from 'B3' along with the ratings of various affiliates or parent company Dynegy Inc. The rating action followed the expiration of the 40-day "go shop" period, according to Moody's, increasing the probability that Dynegy will be acquired by an affiliate of The Blackstone Group L.P.. Moody's said Dynegy's financial profile is expected to be quite fragile, particularly during 2011 and 2012, when the company is projected to generate both negative operating cash flow and negative free cash flow due to weak operating margins and the required funding of their capital investment programs. To the extent that the transactions with Blackstone and NRG are not completed, Moody's said downward rating pressure at DHI and Dynegy will continue to exist given the weak financial prospects for the company over the next few years coupled with the liquidity concerns. In December 2010, Moody's said its ratings and negative rating outlook for Dynegy, Inc., and its subsidiary, Dynegy Holdings (Caa1 Corporate Family Rating) will remain unchanged following announcement of the Icahn deal. DYNEGY INC: UBS AG Discloses 7.82% Equity Stake ----------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on January 31, 2011, UBS AG disclosed that it beneficially owns 9,456,729 shares of common stock of Dynegy Inc. representing 7.82% of the shares outstanding. As of November 1, 2010, there were 120,894,257 shares of common stock outstanding. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE:DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. The Troubled Company Reporter has chronicled Dynegy's attempts to sell itself. In August 2010, Dynegy struck a deal to be acquired by an affiliate of The Blackstone Group at $4.50 a share or roughly $4.7 billion. That offer was raised to $5.00 a share in November. Through Icahn and Seneca's efforts, shareholders thumbed down both offers. On December 22, 2010, an affiliate of IEP commenced a tender offer to purchase all of the outstanding shares of Dynegy common stock for $5.50 per share in cash, or roughly $665 million in the aggregate. Goldman, Sachs & Co. and Greenhill & Co., LLC, are serving as financial advisors and Sullivan & Cromwell LLP is serving as legal counsel to Dynegy. At Sept. 30, 2010, Dynegy had $11.121 billion in total assets, $8.231 billion in total liabilities, and $2.890 billion in stockholders' equity. * * * As reported by the Troubled Company Reporter on November 26, 2010, Fitch Ratings downgraded the ratings of Dynegy Inc. and its subsidiaries: Dynegy Inc. Issuer Default Rating to 'CCC' from 'B-'; Dynegy Holdings, Inc. IDR to 'CCC' from 'B-'; Secured bank credit facilities and notes to 'B+/RR1' from BB-/RR1; Senior unsecured to 'CCC/RR4' from 'B/RR3'; and Dynegy Capital Trust I preferred to 'C/RR6' from 'CCC/RR6'. The downgrade reflects Fitch's belief that the rejection of The Blackstone Group's bid to acquire Dynegy for $5/share will likely lead to another transaction and capital restructuring by Dynegy's management as activist stockholders seek to maximize shareholder values. The downgrade also reflects the underperformance of Dynegy's merchant generation operations. In October 2010, Moody's Investors Service lowered the ratings of Dynegy Holdings, including its Corporate Family Rating, to 'Caa1' from 'B3' along with the ratings of various affiliates or parent company Dynegy Inc. The rating action followed the expiration of the 40-day "go shop" period, according to Moody's, increasing the probability that Dynegy will be acquired by an affiliate of The Blackstone Group L.P.. Moody's said Dynegy's financial profile is expected to be quite fragile, particularly during 2011 and 2012, when the company is projected to generate both negative operating cash flow and negative free cash flow due to weak operating margins and the required funding of their capital investment programs. To the extent that the transactions with Blackstone and NRG are not completed, Moody's said downward rating pressure at DHI and Dynegy will continue to exist given the weak financial prospects for the company over the next few years coupled with the liquidity concerns. In December 2010, Moody's said its ratings and negative rating outlook for Dynegy, Inc., and its subsidiary, Dynegy Holdings (Caa1 Corporate Family Rating) will remain unchanged following announcement of the Icahn deal. EASTMAN KODAK: No Current Plans for Sale or Spinoff, CEO Says ------------------------------------------------------------- Steven Russolillo and Dana Mattioli, writing for The Wall Street Journal, report that Eastman Kodak Co. forecast another year of losses amid continued weakness in its traditional film business as officials faced shareholder questions about the company's declining revenue and anemic stock performance in recent years. The Journal says Kodak CEO Antonio Perez, at an investor meeting Thursday at the New York Stock Exchange, tried to assuage shareholders by saying he expects Kodak to become a sustainably profitable company in 2012, and that he sees revenue in its core growth businesses, including inkjet printers, more than doubling over the next few years. But Mr. Perez said the Company has to change its strategy in the consumer digital business segment, where digital still cameras continue to drag on profits. He offered sparse details but said digital still cameras are "not an attractive market." The Journal notes one attendee chastised management about Kodak's languishing share price and wondered if Mr. Perez would be prepared to sell the company if it didn't turn a profit by 2012. The Journal relates Mr. Perez said there were no current plans to spin off any parts of the Company, but added that Kodak does have a merger and acquisition department that is "constantly looking at ways to" to create shareholder value. Silver Impact The Journal also notes the rising price of silver, a key ingredient used in the manufacturing process of Kodak's film. The report relates Brad Kruchten, president of Kodak's film business, said that over the second half of 2010, silver rose to $30 per troy ounce from $16 per troy ounce, which will affect Kodak from an earnings and inventory standpoint. Mr. Kruchten said to cope with fluctuations, Kodak is now adjusting film prices to reflect changes in silver prices. It is also hedging and restructuring the segment to make it less reliant on silver. Intellectual Property Payments According to the Journal, Chris Whitmore, an analyst at Deutsche Bank, called the investor meeting "uninspiring." He's still concerned about Kodak's reliance on intellectual property payments. The Journal relates Mr. Perez defended Kodak's intellectual property strategy, saying it will continue to use patent-related revenue until 2012 to fund its "growth initiatives" like consumer and commercial inkjet printers. Between 2008 and 2010, Kodak generated $1.9 billion in intellectual property income and licensing. Kodak said it anticipates an average of $250 million to $350 million annually over the next few years from intellectual property revenue. The Journal notes a failed patent licensing deal in the fourth quarter helped send Kodak's profit down 95%. Kodak suffered another blow last month when the International Trade Commission issued a negative recommendation on its complaint against Apple Inc. and BlackBerry maker Research In Motion Ltd. A final determination is due May 23. About Eastman Kodak Headquartered in Rochester, New York, Eastman Kodak Company (NYSE:EK) -- http://www.kodak.com/-- provides imaging technology products and services to the photographic and graphic communications markets. As of December 31, 2010, the Company's balance sheet showed $6.84 billion in total assets, $7.34 billion in total liabilities and a $498 million deficit. As reported by the Troubled Company Reporter on January 31, 2011, Standard & Poor's Ratings Services placed its 'B-' corporate credit rating for Kodak, as well as all related issue-level ratings on the Company's debt, on CreditWatch with negative implications. The CreditWatch placement follows Kodak's fourth- quarter earnings announcement. At Dec. 31, 2010, the Company's cash balance was $1.6 billion -- a decline from $2 billion at Dec. 31, 2009. Revenue declined 6% for the year. Traditional revenue declined 22%, while digital revenue increased 1% for the year. The Company's revenue, earnings, and cash flow in 2010 benefited from one-time intellectual property license transactions. S&P doesn't expect IP-related cash flow to recur at the same level in 2011. Standard & Poor's credit analyst Tulip Lim said, "We could lower the rating if we believe that the Company may not have sufficient liquidity for its needs in 2011 and 2012." On February 19, 2010, Moody's revised its rating outlook on the Company from negative to stable, and affirmed its B3 corporate rating and Caa1 senior unsecured rating. ELWOOD ENERGY: Moody's Affirms 'Ba1' Rating on Senior Bonds ----------------------------------------------------------- Moody's Investors Service affirmed Elwood Energy LLC's Ba1 rating on its senior secured bonds and changed the outlook to negative from stable. Ratings Rationale The rating action reflects Elwood increasing exposure to low merchant capacity prices after 2012 and full merchant exposure in 2017. Starting in 2013, approximately five of Elwood's nine units will rely on PJM's capacity market unless the Project is successful in either extending the existing contract or entering into new contracts. Given Elwood's offtake contract maturities over the next 2-7 years and Elwood's bond maturity in 2026, the Project's rating is likely to decline by one or more notches over time unless the Project is able to execute new long term contracts or take additional actions to improve credit quality. Moody's notes that PJM's capacity prices for the Project are low at around $10/kw-year for the most recent auction compared to approximately $52/kw-year pricing under the offtake contract with Exelon Generation and $60/kw-year under the offtake contract with Constellation Energy. If the low level of prices continue into future auctions for periods beyond 2016, Elwood could incur cash flow shortfalls to service debt after 2016. That said, the rating also takes into consideration the nearly two years period before maturity of the ExGen offtake agreement which provides significant time for the Project to seek a PPA extension or find a replacement. Additionally, Moody's expects Elwood to comfortably cover debt service from 2012 through 2016 based on the Constellation offtake agreements though the Project could experience a decrease in DSCR to below 1.4 times. The negative outlook reflects the expected expiration of the ExGen PSAs at the end of 2012, low PJM capacity prices in the last two auctions covering the May 2012-April 2014 timeframe and potential difficulty in sourcing attractively priced replacement offtake contracts. The Project's rating could stabilize or improve if Elwood is able to enter into new, long term PSAs with investment grade off-takers that have financial terms which result in annual DSCRs being at or above 1.4 times over the long term past 2012. Elwood's rating could decline if Elwood is unable to replace or extend the ExGen PSA resulting in partial merchant exposure in 2012, PJM capacity prices remain at current low levels, Elwood incurs operational problems or either ExGen or CEG is downgraded below Ba1. Elwood Energy LLC owns a 1,409 megawatt peaking facility consisting of nine natural gas-fired, simple cycle units of approximately 156.5 MW, located in Elwood, Illinois, about 50 miles southwest of Chicago. Elwood sells its energy and capacity under a power sales agreement with Exelon Generation (senior unsecured-A3, stable) that expires at the end of 2012, and under two PSAs with Constellation Energy Commodities Group, Inc. (Constellation), a subsidiary of Constellation Energy Group, Inc. (senior unsecured-Baa3 stable) that expire in 2016 and 2017. Constellation's obligation to make payments to Elwood under the PSAs is unconditionally guaranteed by CEG. Elwood is 50% owned by a subsidiary of Dominion Resources, Inc (Baa2 senior unsecured; stable outlook) and 50% indirectly owned by J-POWER USA Generation, L.P., which is a 50/50 joint venture between John Hancock Life Insurance Company and J-POWER USA Investment Co., Ltd. The last rating action on Elwood occurred on August 14, 2006, when Moody's upgraded Elwood's rating to Ba1. EXCO RESOURCES: S&P Retains CreditWatch Negative on 'BB-' Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said its ratings on Dallas- based EXCO Resources Inc., including its 'BB-' corporate credit rating, will remain on CreditWatch, where they were placed with negative implications on Nov. 2, 2010. "The CreditWatch followed EXCO's announcement that its Chairman and CEO, Doug Miller, had submitted a buyout proposal to the board of directors for all the outstanding shares of EXCO stock not owned by Mr. Miller at a cash price of $20.50 per share," said Standard & Poor's credit analyst Patrick Lee. According to Mr. Miller's letter noting the proposal, Boone Pickens, Oaktree Capital Management L.P., and Ares Management LLC, who together with Mr. Miller have nearly 30% of EXCO's outstanding shares and have seats on the board of directors, have expressed an interest in pursuing the acquisition with Mr. Miller. Based on current shares outstanding, the purchase price would be well over $4 billion and could entail debt financing. On Jan. 13, 2011, the Special Committee of the Board of Directors of EXCO Resources Inc. announced that it would explore strategic alternatives to maximize shareholder value, including a potential sale of the company via Mr. Miller's buyout proposal. If Mr. Miller's buyout proposal is successful, leverage may meaningfully increase, negatively affecting credit quality. The proposal also reflects a very aggressive financial policy that was not previously factored in the ratings and that may negatively affect the corporate credit and issue-level ratings. Standard & Poor's intends to resolve the CreditWatch when there is greater clarity on EXCO's strategic alternatives, particularly the buyout proposal. Depending on how the buyout proposal is ultimately structured, S&P could lower the corporate and issue- level ratings by one or more notches if leverage and capital protection materially worsen. FEY 240: Schedules February 23 Plan Confirmation Hearing -------------------------------------------------------- Fey 240 North Brands, LLC, proposes that the U.S. Bankruptcy Court for the Central District of California convene a hearing on February 23, 2011, at 10:00 a.m., to consider confirmation of its Fourth Amended Plan of Reorganization. Objections, if any, are due 14 days prior to the hearing date. According to the explanatory disclosure statement, the Debtor proposes to pay all allowed claims in full in accordance with the terms of the 4th Amended Plan. During the life of the Plan, the Debtor will use its rental income to repay creditors. The Debtor anticipates selling the property towards the end of the Plan to pay any outstanding amounts then owed to secured or unsecured creditors. The previous plan stated that the Debtor anticipated refinancing or selling the property. The 4th Amended Plan states that if the property is sold during the Plan period, the Debtor anticipates that secured and unsecured creditors will be paid in full from the sales proceeds. Most likely, undisputed general unsecured creditors can expect payment in full over the life of the plan. Beginning the first month after plan confirmation and continuing through the terms of the Plan, general unsecured creditors would receive their pro rata share of the 60 equal monthly payments of $8,227.09, and payments would be made through the 60th month of the Plan unless or until the claim is paid in full. A copy of the disclosure statement explaining the Plan is available for free at: http://bankrupt.com/misc/FEY240_4thamendedds.pdf Treatment of Claims Under the 4th Amended Plan, administrative claims must be paid by the February 1, 2011 effective date. In the previous plan, the effective Date was December 1, 2010. BK Attorney Fees will be paid installments of $5,000 beginning with the 20th month of the Plan continuing every 3 months thereafter until $50,000 paid in full. With respect to classified claims: Classification Treatment -------------- --------- 1A - Los Angeles County Assessor -- amortized and paid monthly through 60-month term of the Plan beginning with the first month 1B - Citizens business Bank 1st -- monthly interest only at 5% Trust Deed Including Costs & for the first 19 months; Penalties thereafter a 30-year amortization schedule with interest calculated on the unpaid balance of the loan for the remaining 41 months of the Plan to satisfy the secured claim 1C - DeLovely Properties 2nd -- monthly interest at 5% for 60 Trust Deed months of plan term; unpaid balance paid at the end of the plan term 1D - Glendale Career Schools -- monthly interest at 6% for 60 Secured Claim months of plan term; unpaid balance paid at the end of plan term 1E - Barnust Properties 4th -- unpaid balace paid at the end Trust Deed of the plan term 1F - Evilsizer Construction -- paid in equal monthly Mechanic's Lien installments through 60-month term of plan beginning with the first month 2A - General Unsecured Claims -- 60 Equal payments of $8,277.09 beginning at the first month of the Plan 2B - Unsecured Claims of Lobar -- unpaid balance will be paid & Dorn. Platz at the end of the plan term 2C - Security Deposits -- will be paid pursuant to the terms of lease Class 3 -- Shareholders Interest -- members will retain their membership interest in the LLC Under the 4th Amended Plan, classes 1A, 1B, 1C, 1D, 1E, 1F, 2A, 2B, and 2C are impaired and therefore entitled to vote. In the previous plan, classes 1A, 1B, 1C, 1D, 1E, 1F, 2A, 2B, and 3 are impaired and therefore entitled to vote. The 4th Amended Plan states that a tentative settlement has been reached with Class 1D and claimant should be entitled to vote to the extent that it has an allowed claim. The previous plan stated that Class 2C is disputed and claimant will be entitled to vote to the extent that it has an allowed claim. Under the 4th Amended Plan, Class 3 is unimpaired and therefore doesn't vote. Class 1E as well as Class 2B -- unsecured creditors Lobar Properties and Dorn Platz -- aren't affiliates of the Debtor and there isn't a common ownership between the Debtor and the entities. Under the previous plan, Class 4 is unimpaired and therefore doesn't vote. Class 1D as well as Class 2B -- unsecured creditors Lobar Properties and Dorn Platz -- aren't affiliates of the Debtor and there isn't a common ownership between the Debtor and the entities. Memorandum And Plan Ballot Summary The Debtor submitted with the Court a memorandum and plan ballot summary in support of its request for court approval of its fourth amended Chapter 11 plan of reorganization. The Debtor says that pursuant to the December 1, 2010 court order, the Debtor's proposed fourth amended Chapter 11 disclosure statement and plan was approved subject to changes made to update the status of Glendale Career Schools. Pursuant to the December 7 court order, the approved fifth amended Chapter 11 disclosure statement and plan and the ballots were mailed to the creditors who were entitled to vote on December 7. Pursuant to the December 1, 2010 court order, the creditors were to have at least 21 days to return the ballots. The ballots advised the creditors that the deadline for return of the ballots was December 31. Class lB, Citizens Business Bank, submitted an altered ballot, changing the amount of the allowed claim and rejected the plan. To the extent that this requires a cram down the Debtor requests that the Plan for that class be approved as proposed. Class ID submitted a conditional ballot, seeking additional wording in the Plan regarding source of payments. To the extent that this requires a cram down the Debtor requests that the Plan for that class be approved as proposed. The total included in the Proposed Plan to be paid to the Class 2A unsecured creditors was $493,625.36. 11 ballots were returned, 10 approving the Proposed Plan and one opposing the Plan. The amount of the approved claims that returned ballots approving the Plan was $339,197.22. [69%] The amount of the approved claims that rejected the Plan was $18,590. About Fey 240 North Brand Pasadena, California-based Fey 240 North Brand LLC, filed for Chapter 11 on December 4, 2009 (Bankr. C.D. Calif. Case No. 09- 44228). John P. Schock, Esq. at Schock & Schock, alc, represents the Debtor in its restructuring effort. The Debtor estimated assets and debts at $10 million to $50 million. FKF MADISON: Bankruptcy Judge Open to Appointing Trustee -------------------------------------------------------- Bankruptcy Judge Kevin Gross issued a temporary restraining order forbidding Ira Shapiro from making any more decisions about the One Madison Park project or going ahead with his Chapter 11 restructuring proposal, which is backed by Ian Bruce Eichner. In Green Bridge Capital S.A. and Special Situation S.A., v. Ira Shapiro, Adv. Pro. Case No. 10-56158 (Bankr. D. Del.), the parties are battling over control of the project and to establish who has authority to steer the Debtors through their bankruptcy cases. The entity at the center of the present controversy is Slazer Enterprises, LLC, a New York limited liability company. Slazer is the sole member of Slazer Owner -- one of the Debtors -- and serves as the manager for all of the Debtors. It is the control of Slazer, and thereby the indirect control of the Debtors, which is at the center of the adversary proceeding. Defendant Ira Shapiro and Marc Jacobs formed Slazer in 2006 and both owned a 50% membership interest in Slazer. The ownership of Slazer and whether Mr. Shapiro took authorized actions and has authority to act on Slazer's and, as manager, the Debtors' behalf are the issues presented. The plaintiffs claim the authority is theirs. The plaintiffs moved for a temporary restraining order to enjoin what they claim is the unauthorized exercise of authority. The Plaintiffs acquired a 67.5% voting interest in Slazer pre- bankruptcy. Judge Gross held that the Plaintiffs have established that Slazer's members must act by majority for actions on its behalf and by unanimity for any material actions on the Debtors' behalf. Unless plaintiffs and Mr. Shapiro reach agreement, a deadlock will exist. Judge Gross warned that if the deadlock continues, the Court may be compelled to appoint a Chapter 11 trustee. It is therefore imperative that the plaintiffs and Shapiro enter into negotiations to develop a plan. The Court will consider the appointment of a Chapter 11 trustee at the hearing scheduled for February 8, 2011. "Plaintiffs and Shapiro will be well advised to appear at the hearing with a term sheet for a plan of reorganization. The parties should also be prepared to address the attorney representation of Debtors," Judge Gross said. A copy of Judge Gross' January 31, 2011 memorandum opinion is available at http://is.gd/jiH58Mfrom Legale.com. Counsel for the Debtors is: Bruce Grohsgal, Esq. PACHULSKI, STANG, ZIEHL & JONES LLP 919 North Market Street, 17th Floor Wilmington, DE 19801 Tel: 302-778-6403 E-mail: bgrohsgal@pszjlaw.com Counsel for Green Bridge Capital S.A. and Special Situation, S.A., are: Carl N. Kunz, III, Esq. Brett D. Fallon, Esq. Douglas N. Candeub, Esq. MORRIS JAMES LLP 500 Delaware Avenue, Suite 1500 Wilmington, DE 19801-1494 Tel: 302-888-6811 E-mail: ckunz@morrisjames.com bfallon@morrisjames.com dcandeub@morrisjames.com * * * Peg Brickley, writing for Dow Jones' Daily Bankruptcy Review, reports that Mr. Shapiro said in an interview Tuesday he's determined to see the 50-story tower through to the end. Mr. Brickley says it could be a tough goal to hit, what with the property itself in the hands of a state-appointed receiver, Mr. Shapiro getting barred by the bankruptcy judge from making any big decisions about its future, and questions about such matters as $2,000 worth of Hannah Montana tickets charged to the project's credit card. "I work very hard for what I have built," Mr. Shapiro explained at a Jan. 20 court session, fielding questions about the tickets and other expenses, according to DBR. Ms. Brickley relates the questions came from Douglas Candeub, attorney for Mr. Shapiro's foe and project investor Cevdet Caner. According to the DBR, Mr. Shapiro said personal expenses charged on the corporate card were later credited against the $4.5 million developer's fee for One Madison Park. "People have brought this up to me in the past," Mr. Shapiro said, according to DBR. "I worked hard. It was my salary and I absolutely feel that if I chose to use it that way. . . ." According to the DBR, Mr. Candeub also asked about the $42,000 for a plane to Sarasota, Fla., $30,295 for another plane trip, and $15,751 for a couple of helicopter trips charged on the corporate credit card. DBR notes Messrs. Caner and Shapiro are sitting together at the plan bargaining table now, because the judge also said Mr. Caner can't call the shots on his own even though he has majority voting power. Corporate documents require unanimous approval of major decisions, like how to dig out of a debt hole that's more than $150 million, and growing. By Monday, Shapiro and Caner have to have agreed on a bailout plan for One Madison, or they could find themselves out on the street. DBR says as equity stakeholders, they stand to be wiped out in the bankruptcy case. Hanging on to some kind of role in One Madison Park's future may be the best they're likely to be able to do. Mr. Caner put $24.6 million into the project, much of it in the form of mezzanine financing. DBR says it's unsecured debt now and totals $33 million, counting in the unpaid interest and fees. DBR relates Mr. Caner is eyeing a Chapter 11 plan that would allow his company to handle sales and project finances. DBR also notes Judge Gross said he didn't have to deal with allegations of mismanagement and other wrongs, yet. About One Madison Park FKF Madison Park Group Owner, LLC, filed for Chapter 11 bankruptcy protection on June 8, 2010 (Bankr. D. Del. Case No. 10-11867). FKF Madison owns the One Madison Park condominium tower in New York City. One Madison Park project came to halt in February 2010 when iStar Financial Inc., the chief financier for the project, moved to foreclose on it. The high-profile condominium project, a 50-story tower was developed by Ira Shapiro and Marc Jacobs. FLANDERS PROPERTIES: Case Summary & 8 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Flanders Properties, LLC 1805 Blanton Mill Road Griffin, GA 30224 Bankruptcy Case No.: 11-10363 Chapter 11 Petition Date: February 1, 2011 Court: U.S. Bankruptcy Court Northern District of Georgia (Newnan) Debtor's Counsel: Cameron M. McCord, Esq. JONES & WALDEN, LLC 21 Eighth Street, NE Atlanta, GA 30309 Tel: (404) 564-9300 Fax: (404) 564-9301 E-mail: cmccord@joneswalden.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/ganb11-10363.pdf The petition was signed by Frank B. Flanders, Jr., managing member. FOUR LIONS: Files Schedules of Assets & Liabilities --------------------------------------------------- Four Lions Corp. has filed with the U.S. Bankruptcy Court for the District of Puerto Rico its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities --------------- ------ ----------- A. Real Property $17,955,000 B. Personal Property $0 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $24,659,046 E. Creditors Holding Unsecured Priority Claims $62,658 F. Creditors Holding Unsecured Non-priority Claims $14,484,587 ----------- ----------- TOTAL $17,955,000 $39,206,291 A copy of the Schedules of Assets & Liabilities is available for free at http://bankrupt.com/misc/FOUR_LIONS_sal.pdf San Juan, Puerto Rico-based Four Lions, Corp., filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. P.R. Case No. 11-00419). Alexis Fuentes Hernandez, Esq., at the Fuentes Law Offices, serves as the Debtor's bankruptcy counsel. FOUR LIONS: Section 341(a) Meeting Scheduled for Feb. 28 -------------------------------------------------------- The U.S. Trustee for Region 21 will convene a meeting of Four Lions Corp.'s creditors on February 28, 2011, at 1:00 p.m. The meeting will be held at Ochoa Building, 500 Tanca Street, First Floor, San Juan, Puerto Rico. 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. San Juan, Puerto Rico-based Four Lions, Corp., filed for Chapter 11 bankruptcy protection on January 24, 2011 (Bankr. D. P.R. Case No. 11-00419). Alexis Fuentes Hernandez, Esq., at the Fuentes Law Offices, serves as the Debtor's bankruptcy counsel. According to its schedules, the Debtor disclosed $17,955,000 in total assets and $39,206,291 in total debts. GENDER PARTNERS: Dist. Ct. Affirms Stay for Bank Loan Guarantors ---------------------------------------------------------------- WestLaw reports that a creditor's collection actions against owners and principals of a bankrupt limited liability company to recover on their guarantees of the debtor-LLC's debt were properly enjoined, given evidence that the owner/principals' participation in the Chapter 11 case was essential to the LLC's ability to successfully reorganize. The LLC had a likelihood of successfully reorganizing if the owner/principals' energies were not diverted in defense of the collection actions, and a failure of the reorganization effort would have dire consequences on the LLC's ability to satisfy the claims of creditors, including that of the creditor pursuing the collection actions on the guarantees. The creditor, on the other hand, faced only a temporary stay if an injunction were entered to allow the reorganization to progress. Harris N.A. v. Gander Partners LLC, --- B.R. ----, 2011 WL 249484 (N.D. Ill.). A copy of the Honorable Samuel Der-Yeghiayan's Memorandum Opinion dated Jan. 26, 2011, is available at http://is.gd/AQM62kfrom Leagle.com. This decision affirms the Bankruptcy Court ruling reported in the Aug. 6, 2010, edition of the Troubled Company Reporter in In re Gander Partners LLC, 432 B.R. 781, 2010 WL 2802668, slip op. http://is.gd/8o0fTA (Bankr. N.D. Ill.) (Cox, J.). Gander Partners LLC, Copper Peak Development Corp., Prairie View Development Corp., sought chapter 11 protection (Bankr. N.D. Ill. Case Nos. 10-08877, 10-08879 and 10-08882) on Mar. 3, 2010. Scott R. Clar, Esq., at Crane Heyman Simon Welch & Clar in Chicago, represents the Debtors. Copies of the Debtors' chapter 11 petitions are available at: http://bankrupt.com/misc/ilnb10-08877.pdfand http://bankrupt.com/misc/ilnb10-08879.pdfand http://bankrupt.com/misc/ilnb10-08882.pdfat no charge. GARNET BIOTHERAPEUTICS: Proofs of Claim Due By March 2, 2011 ------------------------------------------------------------ On Jan. 25, 2011, the United States Bankruptcy Court for the District of Delaware entered an order establishing certain deadlines for the filing of proofs of claims in Garnet BioTherapeutics, Inc.'s chapter 11 case. Pursuant to the Bar Date Order, all persons or entities (including, without limitation, any individual, partnership, joint venture, corporation, limited liability company, estate, trust or governmental units) who have a claim or potential claim against the Debtor that arose prior to December 28, 2010, no matter how remote or contingent such right to payment or equitable remedy may be, MUST FILE A PROOF CLAIM on or before 4:00 p.m. (prevailing Eastern Time), on Mar. 2, 2011. Governmental units have until June 30, 2011, to file their proofs of claim. Questions about the Bar Date and requests for proof of claim forms should be directed the Debtor's lawyers: William A. Hazeltine, Esq. SULLIVAN HAZELTINE ALLINSON LLC 4 East 8th Street, Suite 400 Wilmington, DE 19801 Telephone: (302) 428-8191 Fax: (302) 428-8195 E-mail: whazeltine@sha-llc.com Malvern, Pa.-based Garnet BioTherapeutics, Inc. -- a "clinical stage regenerative medicine company" -- sought Chapter 11 protection (Bankr. D. Del. Case No. 10-14165) on Dec. 28, 2010. William A. Hazeltine, Esq., at Sullivan Hazeltine Allinson LLC, in Wilmington, Del., represents the Debtor. The Debtor estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. GENWORTH MORTGAGE: S&P Cuts Counterparty Credit Rating to 'BB+' --------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its counterparty credit and financial strength ratings on Genworth Mortgage Insurance Corp. and Genworth Residential Mortgage Insurance Corp. of North Carolina to 'BB+' from 'BBB-'. The outlook is negative. At the same time, S&P revised its outlook on Genworth Financial Inc. and Genworth Financial Mortgage Insurance Ltd. (Europe) to negative, and S&P affirmed its 'BBB' long-term counterparty credit ratings on the companies. The ratings on GNW's U.S. life insurance companies are unaffected by these actions. "In the fourth quarter, Genworth's U.S. mortgage insurance operations reported pretax losses of $533 million, compared with pretax losses of $230 million in the third quarter, $72 million in the second quarter, and $52 million in the first quarter," said Standard & Poor's credit analyst Jeremy Rosenbaum. "This brings total pretax losses to $887 million in full-year 2010, which exceeds S&P's expectations for full-year losses of approximately $300 million." The outsized losses in the fourth quarter stem largely from reserve increases related to the aging of the delinquency inventory as well as significant declines in loss-mitigation activities across the sand states. This contrasts with the third- quarter reserve adjustment, which was specific to Florida. "The size of the fourth-quarter adjustment and the fact that it follows a sizable adjustment in the third quarter highlights USMI's more aggressive reserve methodology during this loss cycle relative to peers," said Mr. Rosenbaum. "S&P believes the company incorporated loss reserve benefits relating to rescission and modification activity earlier in the loss cycle than its peers, which made it more susceptible to adverse deviation." Despite GNW's bolstered cash and liquidity positions following a string of capital-raising initiatives (approximately $2 billion over the past two years), as well as the improving operating performance at the retirement and protection segment, the outlook on the company is negative. The ratings and outlook on GFMI Europe are based on an unconditional guarantee provided by GNW. As such, the ratings and outlooks on GNW and GFMI Europe are the same. Although S&P currently do not believe that GNW will need to support its USMI subsidiaries through capital infusions, the likelihood has increased, and S&P believes that continued poor performance at the USMI subsidiaries may strain financial flexibility. S&P could lower the rating on GNW if the USMI subsidiaries become a cash drain on the holding company. GNW's fixed-charge coverage ratio is at the low end of S&P's expectations for the rating, but S&P thinks it will improve to 4x to 5x over the next 12 to 18 months. The outlook on GMICO is negative, reflecting uncertain macroeconomic conditions and the potential for further adverse reserve adjustments. Despite signs of improvement, the U.S. economy remains fragile and could experience a setback. Although the rate of new notices has declined in the most recent quarters, delinquencies likely would rise again if the economy were to enter another downturn. If the economy were to experience a setback that results in higher delinquencies or losses, which could significantly impair GMICO's capital and claims paying ability, S&P could lower the ratings. S&P could also lower the ratings if future results reflect further significant reserve adjustments (calling into question GMICO's reserve adequacy again). GLOBAL CASH: Moody's Assigns 'B1' Rating to $235 Mil. Senior Loan ----------------------------------------------------------------- Moody's Investors Service has assigned B1 ratings to Global Cash Access, Inc.'s $235 million of proposed senior secured credit facilities comprising a $30 million revolving credit facility and a $205 million term loan facility. As part of the rating action, Moody's affirmed GCA's B1 Corporate Family Rating and revised the Company's Probability of Default Rating to B2, from B1. The Company plans to use the proceeds from the term loan issuance and about $3 million of cash on hand to refinance existing indebtedness, and pay fees and expenses. Moody's also affirmed the B3 rating for GCA's senior subordinated notes, which will be withdrawn upon full repayment of the notes at the close of the transaction. The outlook for ratings is stable. Moody's has taken these rating actions: Issuer: Global Cash Access, Inc. -- US$30 million Senior Secured Bank Credit Facility - Assigned, B1, LGD3, 37 % -- US$205 million Senior Secured Bank Credit Facility - Assigned, B1, LGD3, 37 % -- Corporate Family Rating - Affirmed, B1 -- Probability of Default Rating - Lowered to B2 to B1 -- 8.75% Senior Subordinated Notes due 2012 - Affirmed, B3 (LGD-5, 77%), to be subsequently withdrawn -- Outlook - Stable Ratings Rationale The affirmation of GCA's Corporate Family Rating reflects Moody's views that the Company's good free cash flow generation and interest coverage metrics continue to support the B1 rating, despite sustained decline in operating performance during a severe economic downturn and the loss of its largest customer in November 2010. Furthermore, Moody's believes that the risks of further erosion in pricing and loss of significant customers are mitigated with the recent successes in renewing multi-year contracts with key customers. The rating agency expects that a combination of new business growth, stabilizing same store sales, and prioritization of debt reduction should help the Company restore its balance sheet and drive debt-to-EBITDA leverage to 2.5x-to- 3.0x range over the next 12-to-18 months. The B1 Corporate Family Rating reflects GCA's leading market position as a cash access services provider to U.S. gaming establishments, its moderate financial risk, and good liquidity supported by moderate levels of free cash flow generation. The rating is constrained by the extremely challenging operating conditions in the U.S. gaming industry, the Company's intensely competitive operating environment, and the ongoing pricing pressure on operating margins. The rating also considers GCA's high customer concentration as well as growing challenges from cashless gaming, which could result in lower demand for GCA's cash access products, and the potential for continued margin pressure due to shifts in consumption patterns from higher margin cash advance products to ATM transactions. The stable outlook reflects Moody's expectations that GCA's EBITDA will stabilize during 2011 and that the Company will prioritize debt repayment such that leverage could be maintained at less than 3.0x. What Could Drive the Rating -- Up Although not expected at this time, Moody's could raise GCA's rating if the Company's business environment improves significantly, it generates solid cash flows driven by improved profitability and revenue growth, and sustain debt-to-EBITDA leverage of less than 2.5x. What Could Drive the Rating -- Down The rating or the outlook could come under pressure if transaction volumes continue to decline, price erosion depresses EBITDA margins, or the Company loses large customer relationships, which result in a material decline in profitability. The rating or the outlook could be lowered if deteriorating operating performance or shareholder friendly fiscal policies drive debt-to-EBITDA leverage to above 3.5x and free cash flow generation falls to less than 10% of total debt over an extended period of time, or liquidity becomes weak. The last rating action on GCA was on June 27, 2008, when Moody's confirmed the Company's B1 CFR with a stable outlook. Headquartered in Las Vegas, NV, Global Cash Access, Inc., a wholly owned subsidiary of Global Cash Access Holdings Inc., is a leading provider of cash access products and related services to the gaming industry in the U.S. and several international markets. GCA reported $617 million in revenues for the last twelve months period ended September 2010. GLOBAL CASH: S&P Changes Outlook to Stable, Affirms 'BB-' Rating ---------------------------------------------------------------- Standard & Poor's Rating Services said it revised its outlook on Las Vegas-based Global Cash Access Inc. to stable from negative. At the same time, S&P affirmed the company's 'BB-' corporate credit rating. S&P also assigned ratings to the company's proposed $235 million senior secured first-lien credit facility, consisting of a $25 million revolving credit facility and a $210 million term loan B. The revolver and term loan received issue-level ratings of 'BB-', and recovery ratings of '3', indicating S&P's expectation for meaningful (50%-70%) recovery in the event of a payment default. The company intends to use the proceeds from the new facility to refinance its existing unrated senior secured $100 million revolving credit and $100 million term loan facilities, as well as retire all remaining outstanding borrowings under its 8.75% senior subordinated notes ($127.8 million currently outstanding). "The outlook revision to stable from negative is based on GCA's completion of the announced refinancing transaction, which resolves both the potential mid-2011 covenant headroom concerns, and the refinancing risk and near-term maturity associated with the company's existing debt," explained Standard & Poor's credit analyst Alfred Bonfantini. Furthermore, the company has been successful thus far in renewing several major customer contracts, including MGM Resorts International and Boyd Gaming Corp., after losing its largest contract last year, Harrah's Operating Co. Inc., which represented approximately 14% revenues. "However," added Mr. Bonfantini, "the company has continued to see lower overall transaction volumes and a pronounced decrease in credit card cash advance transactions, with a shift toward a greater percentage of lower margin ATM withdrawal transactions." S&P believes that these trends have bottomed, but that there will be no material improvement in gaming foot traffic and revenue mix over the near term, as Standard & Poor's also believes that prospects for meaningful growth in the U.S. gaming market over the next year or so are limited. This outlook for gaming revenues, coupled with the loss of Harrah's as a customer should result in significantly lower revenue and EBITDA in 2011, but GCA's financial profile provides a cushion within its existing rating to absorb these weak operational developments, as well as its ongoing high customer concentration. Somewhat offsetting these negative factors are the company's leading market position in its niche, still moderate leverage for the rating, ability to generate solid discretionary cash flow, and recurring revenues stemming from long-term contracts. GMX RESOURCES: Moody's Assigns 'Caa2' Rating to $200 Mil. Notes --------------------------------------------------------------- Moody's Investors Service assigned a Caa2 rating to GMX Resources Inc.'s proposed $200 million senior unsecured notes due 2019. Moody's also assigned a first time Caa1 Corporate Family Rating and SGL-3 Speculative Grade Liquidity rating to GMX. Net proceeds from the notes offering and concurrent common equity offering will be used to fund an offer to purchase $50 million of the company's 5% convertible senior notes, repay all outstanding revolver debt, fund the $68.3 million cash portion of the purchase price of its pending Bakken and Niobrara acquisitions, and fund a portion of 2011 capital spending. The rating outlook is stable. Ratings Rationale "GMX's Caa1 CFR reflects its small size, limited diversification, production that is 97% natural gas in a low gas price environment, high leverage on production and reserves, and the risks inherent in developing its newly acquired oil focused Bakken and Niobrara acreage while outspending cash flow," commented Jonathan Kalmanoff, Moody's Analyst. "The rating also considers the potential for improvement in both profitability and diversification if GMX is successful in developing its newly acquired acreage, the pre-funding of the majority of 2011 capital spending through both debt and equity offerings, a lack of required drilling to hold acreage in the company's East Texas properties, and hedges in place which add support to realized prices for gas production through 2012." At December 31, 2010, pro-forma, debt / average daily production was $42,623/boe and debt / proven developed reserves was $14.94/boe. In assessing leverage, Moody's views 75% of GMX's 9.25% Series B Cumulative Preferred Stock as debt. The SGL-3 liquidity rating reflects adequate liquidity through 2011. At the closing of its debt and equity offerings, the company will have $60 million of availability under its undrawn borrowing base credit facility and $107 million of cash. Capital expenditures are expected to exceed cash flow during 2011. The credit facility, which is being amended concurrently with the notes offering, has a $100 million commitment with an initial borrowing base of $60 million. The borrowing base is re- determined semi-annually with the next re-determination scheduled for October 1, 2011. Financial covenants under the facility are Senior Secured Debt / EBITDA of not more than 2.5x, EBITDA / interest of not less than 2.5x, and a current ratio of not less than 1.0x. There are no debt maturities until 2013. Substantially all of GMX's oil and gas reserves are pledged as security under the credit facility which limits the extent to which asset sales could provide a source of additional liquidity; however, the company would be able to sell drilling rig and midstream assets held in its subsidiaries to raise additional liquidity if needed. The Caa2 senior unsecured note rating reflects both the overall probability of default of GMX, to which Moody's assigns a PDR of Caa1, and a loss given default of LGD4-58%. The size of the senior secured revolver's potential priority claim relative to the senior unsecured notes results in the notes being rated one notch beneath the Caa1 CFR under Moody's Loss Given Default Methodology. The stable outlook reflects Moody's expectation that GMX will maintain adequate liquidity as it outspends cash flow to develop its properties. Negative ratings action could result if liquidity were to tighten due to unexpected production declines relative to debt funded capital spending, a reduction in availability under the company's borrowing base credit facility, or reduced cash flow due to uneconomic realized prices for natural gas production. Positive ratings action could result if GMX were to meet its forecasts for production growth in the Bakken and Niobrara leading to daily production over 15,000 boe with debt / average daily production of less than $25,000/boe and trending downward. GMX Resources Inc. is an independent exploration and production company headquartered in Oklahoma City, OK. GMX RESOURCES: S&P Puts 'B-' Corp. Credit Rating; Outlook Stable ---------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'B-' corporate credit rating to GMX Resources Inc. The outlook is stable. At the same time S&P assigned a preliminary 'B-'issue rating to GMX's proposed $200 million senior unsecured notes. S&P assigned a '4' preliminary recovery rating to the notes, indicating S&P's expectation of average (30% to 50%) recovery for lenders in the event of a payment default. S&P expects proceeds from the notes offering and a concurrent $100 million common stock offering to be used to refinance existing debt as well as fund near-term capital spending. The ratings are preliminary, and subject to a review at the completion of the proposed transactions. If actual results vary from current expectations, S&P would review the proposed ratings in light of any changes, and could change the preliminary ratings being assigned. "The ratings on Oklahoma City-based GMX Resources Inc. reflect the company's limited scale of operations, meaningful exposure to weak natural gas prices, a very aggressive near-term spending plan, limited liquidity beyond 2011, and elevated debt leverage," said Standard & Poor's credit analyst Paul B. Harvey. Near-term credit quality will benefit from the liquidity provided by GMX's proposed $200 million senior unsecured note issuance and concurrent $100 million common equity offering, as well as expectations for growing production from its Haynesville Shale development. The stable outlook reflects the benefits from GMX's favorable hedges, expectations for growing production, and the liquidity provided by the concurrent debt and equity offerings. Ratings could be lowered if GMX fails too maintain sufficient liquidity, $30 million or greater, or if its drilling program is unsuccessful. Given the company's aggressive capital spending and less than adequate liquidity, positive rating actions are not currently expected within the next 12 to 18 months. GNP RLY: Involuntary Chapter 11 Case Summary -------------------------------------------- Alleged Debtor: GNP Rly, Inc. 410 Garfield Street S. Tacoma, WA 98444 Bankruptcy Case No.: 11-40829 Involuntary Chapter 11 Petition Date: February 2, 2011 Court: U.S. Bankruptcy Court Western District of Washington (Tacoma) Petitioners' Counsel: James E. Dickmeyer, Esq. JAMES E. DICKMEYER, P.C. 121 3rd Avenue Kirkland, WA 98033 Tel: (425) 889-2324 E-mail: jim@jdlaw.net Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Ballard Terminal Railroad Company Freight Services $110,800 LLC 4725 Ballard Avenue NW Seattle, WA 98107 Marketing Philharmonic LLC Services $48,466 218 Main Street, #668 Kirkland, WA 98033 San Clemente Technical Co. Services $15,200 29 Calle Cameron San Clemente, CA 92673 GRAND BEAR: Asks La Salle County Board to Lower Property Taxes -------------------------------------------------------------- Kevin Caufield at the News Tribune in La Salle, Illinois, reports that Grand Bear Lodge officials met with La Salle County Board of Review to ask for a decrease in its property taxes that would save about $50,000 annually from its operating costs. According to the report, the move -- combined with other cost- cutting measures such as reductions in insurance, overhead and possibly decreasing hours and employees -- is meant to help trim $500,000 annually from Grand Bear's operating costs, the amount lodge financial consultant Alan Dikcis believes it will need in order to qualify for its Chapter 11 bankruptcy filing. "The creditors will have the final say in the bankruptcy plan, but this would go a long way in getting that approved," the report quotes Mr. Dikcis as stating. "We want to keep this a running, viable business." Lockport, Illinois-based Grand Bear Lodge, LLC, filed for Chapter 11 protection in Chicago on Jan. 21, 2011 (Bankr. N.D. Ill. Case No. 11-02321), estimating assets of up to $50,000 and debts of $10 million to $50 million. The decision to file was due to the Company's inability to get a loan extension from its primary lender, according to the LaSalle News Tribune. GULFSTREAM INT'L: Ch. 11 Spurs Regional Airport Woes ---------------------------------------------------- Dianne Byers, staff writer at The Progress, reports that the bankruptcy proceedings of Gulfstream International Airlines is creating financial turmoil for the Clearfield and Jefferson Counties Regional Airport Authority. According to the report, with GIA's bankruptcy filing, the authority opened a $40,000 line of credit at Community First Bank, raised cash to meet operating expenses by offering a 5% discount to tenants who paid in advance, and appealed to both Clearfield and Jefferson counties' boards of commissioners to advance the first quarter share of their annual allocations. About $16,000 of the loan has been used to meet payroll and other day-to-day expenses. Robert Shaffer, DuBois Regional Airport manager, said, the authority has filed a $80,000 claim and believes that it will be paid in full. About Gulfstream International Fort Lauderdale, Florida-based Gulfstream International Airlines (NYSE Amex: GIA) operated a fleet of turboprop Beechcraft 19000 aircraft, and specialized in providing travelers with access to niche locations not typically covered by major carriers. GIA operated more than 150 scheduled flights per day, serving nine destinations in Florida, 10 destinations in the Bahamas, five destinations from Continental Airline's hub under the Department of Transportation's Essential Air Service Program and supports charter service to Cuba through a services agreement with Gulfstream Air Charter, Inc., an entity otherwise unrelated to the Debtors. GIA operated as a Continental Connection carrier, as well as for United Airlines, Northwest Airlines and Copa Airlines, through code share agreements. GIA has 620 employees, including 530 working full-time. Gulfstream International Group, Inc., and its units including Gulfstream International Airline, Inc., filed for Chapter 11 bankruptcy protection on November 4, 2010 (Bankr. S.D. Fla. Case No. 10-44131). Brian K. Gart, Esq., at Berger Singerman, P.A., serves as the Debtors' bankruptcy counsel. Jetstream Aviation Capital, LLC and Jetstream Aviation Management, LLC, serve as financial advisors to the Debtors. Robert A. Schatzman, Esq., Steven J. Solomon, Esq., and Frank P. Terzo, Esq., at GrayRobinson, P.A., in Miami, Florida, serve as counsel to the Official Committee of Unsecured Creditors. Gulfstream International Airlines disclosed $15,967,096 in assets and $25,243,099 in liabilities in its Schedules of Assets and Liabilities. GULFSTREAM INT'L: To Start Flying Montana EAS Routes ---------------------------------------------------- Jan Falstad at the Billings Gazette reports that Gulfstream International Airlines may start flying the Montana EAS routes as soon as May, replacing the current carrier, Great Lakes Airlines of Cheyenne, Wyoming, after the Montana Essential Air Service Task Force received approval in Washington, D.C. to switch airlines serving seven Eastern Montana cities Gulfstream will fly 19-passenger Beechcraft B-1900D airplanes and provide a dozen flights per week to Glasgow, Glendive, Havre, Lewistown, Miles City, Sidney and Wolf Point. The two-year contract carries an annual subsidy of $10,903,854, according to the U.S. Department of Transportation, which has approved the switch in airlines. About Gulfstream International Fort Lauderdale, Florida-based Gulfstream International Airlines (NYSE Amex: GIA) operated a fleet of turboprop Beechcraft 19000 aircraft, and specialized in providing travelers with access to niche locations not typically covered by major carriers. GIA operated more than 150 scheduled flights per day, serving nine destinations in Florida, 10 destinations in the Bahamas, five destinations from Continental Airline's hub under the Department of Transportation's Essential Air Service Program and supports charter service to Cuba through a services agreement with Gulfstream Air Charter, Inc., an entity otherwise unrelated to the Debtors. GIA operated as a Continental Connection carrier, as well as for United Airlines, Northwest Airlines and Copa Airlines, through code share agreements. GIA has 620 employees, including 530 working full-time. Gulfstream International Group, Inc., and its units including Gulfstream International Airline, Inc., filed for Chapter 11 bankruptcy protection on November 4, 2010 (Bankr. S.D. Fla. Case No. 10-44131). Brian K. Gart, Esq., at Berger Singerman, P.A., serves as the Debtors' bankruptcy counsel. Jetstream Aviation Capital, LLC and Jetstream Aviation Management, LLC, serve as financial advisors to the Debtors. Robert A. Schatzman, Esq., Steven J. Solomon, Esq., and Frank P. Terzo, Esq., at GrayRobinson, P.A., in Miami, Florida, serve as counsel to the Official Committee of Unsecured Creditors. Gulfstream International Airlines disclosed $15,967,096 in assets and $25,243,099 in liabilities in its Schedules of Assets and Liabilities. HAWKS PRAIRIE: Pacific Real to Sell Hawks Prairie Property ---------------------------------------------------------- Rolf Boone at The Olympian reports that Pacific Real Estate Partners and its Olympia representatives were hired to sell developer Tri M. Vo's Hawks Prairie property, a 338-acre parcel north of Interstate 5 that at one time was set to become a massive mixed-use development called Lacey Gateway Town Center. The property consists of 123 acres of land zoned for residential use and 215 acres of mixed-use property. Sale proceeds likely will be used to pay off bankrupt Hawks Prairie Investment LLC's debts to HomeStreet Bank of Seattle, the largest creditor in the case. Tri M. Vo is the manager and owner of Hawks Prairie Investment. About Hawks Prairie Investment LLC Olympia, Washington-based Hawks Prairie Investment LLC owns real property in Thurston County, Washington. It filed for Chapter 11 bankruptcy protection on August 13, 2010 (Bankr. W.D. Wash. Case No. 10-46635). Timothy W. Dore, Esq., at Ryan Swanson & Cleveland PLLC, represents the Debtor. The Company disclosed $89,000,071 in assets and $44,778,104 in liabilities as of the Chapter 11 filing. An affiliate, Pacific Investment Group LLC, filed a separate Chapter 11 petition on October 22, 2009 (Bankr. W.D. Wash. Case No. 09-47915). H.B. FENN: To File Proposal Under Canada's Bankruptcy Laws ---------------------------------------------------------- Michael Oliveira, writing for The Canadian Press, reports that H.B. Fenn and Company Ltd., Canada's largest book distributor, said Thursday it plans to file a proposal under the Bankruptcy and Insolvency Act. In a brief statement, H.B. Fenn said it has "encountered significant financial challenges due to the loss of distribution lines, shrinking margins and the significant shift to e-books, all of which have significantly reduced the company's revenues." "We have worked extremely hard to build the company and keep it going even under today's adverse conditions," said founder and CEO Harold Fenn. "My heart goes out to our over 125 employees and to the many publishers we represent, as well as the customers that have supported us over the years." According to The Canadian Press, lawyer D.J. Miller, of the Toronto-based restructuring and litigation firm Thornton Grout Finnigan, said the move does not necessarily mean H.B. Fenn is headed for bankruptcy. Instead, she said, the proposal could be a way for the Company to begin restructuring its business. "They're telegraphing to the world that they're going to be putting out a proposal that outlines what the terms of the restructuring will be, which will be voted on by creditors," Ms. Miller said, according to The Canadian Press. The report relates Ms. Miller said, "The purpose of the proposal will be to compromise the existing debt and allow the company to move forward with less debt." The Canadian Press notes H.B. Fenn can continue to operate without interference from creditors. It will have to provide a cash-flow statement and file a proposal to creditors within 30 days, unless an extension is granted by the courts. The Canadian Press recounts H.B. Fenn unit Key Porter Books temporarily suspended publishing operations last month. In September, Key Porter laid off almost two-thirds of its staff but staff denied reports the Company was going bankrupt. A spokesman at H.B. Fenn could not immediately be reached for comment, The Canadian Press says. HEADLINE NEWS: Tacoma Writes Off $32,000 Advertising Debt --------------------------------------------------------- Todd Matthews, writing for The Tacoma Daily Index, reports that the Tacoma City Council on Tuesday cleared an outstanding debt owed by advertising agency Headline News (not related to CNN Headline News), which once advertised in the Tacoma Dome but has since gone bankrupt. According to the report, the total amount of debt equaled $32,824.25. Tacoma Municipal Code requires City Council to clear any debts over $25,000. City council approved a resolution Tuesday to clear the debt. The Tacoma Daily Index relates that, according to Public Facilities Director Mike Combs, the city entered into a five-year, $230,000 contract with Headline News in 1994 for a series of advertising panels. Four years later, the contract was canceled due to non-payment. The city tried to collect on the debt, but "the individuals with knowledge of the agreement and attempts to recover the outstanding debt are not longer available," Mr. Combs told councilmembers Tuesday. "This account was written off as bad debt many years ago but remained on the general ledger. This is an accounting process that removed this debt from the general ledger. This action has no impact on the general fund and no impact on the Dome's operating fund." ICOP DIGITAL: Bankruptcy Court Approves Sale Plan ------------------------------------------------- Eric Sanderson at BankruptcyHome.com reports that Bankruptcy Judge Robert Berger approved a plan by ICOP Digital Inc. that would allow the Company to liquidate its remaining assets. Bidders have until the end of February to declare interest in acquiring the Company's assets. About ICOP Digital Founded in 2002, ICOP Digital Inc. sells surveillance equipment for law enforcement agencies. Lenexa, Kansas-based ICOP Digital filed for Chapter 11 protection in Kansas City (Bankr. D. Kan. Case No. 11-20140) on Jan. 21, 2011. In its Schedules of Assets and Liabilities, the Debtor disclosed assets of $1.67 million and debt of $2.74 million. The balance sheet as of Sept. 30 had assets on the books for $6.7 million and total liabilities of $4.3 million, according to Mr. Rochelle. Joanne B. Stutz, Esq., at Evans & Mullinix PA, in Shawnee, Kansas, represents the Debtor. ILEC FAIRPOINT: S&P Assigns 'B' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services said it assigned Charlotte, N.C.-based incumbent local exchange carrier ILEC FairPoint Communications Inc. its 'B' corporate credit rating with a stable rating outlook. The company emerged from bankruptcy on Jan. 24, 2011. In addition, S&P assigned FairPoint's $75 million first-lien revolving credit facility an issue-level rating of 'BB-' (two notches higher than the 'B' corporate credit rating) with a recovery rating of '1', indicating S&P's expectation of very high (90%-100%) recovery for lenders in the event of a payment default. The revolver initially matures in January 2014, with two optional one-year renewals. S&P also assigned the company's $1 billion second-lien term loan due 2016 an issue-level rating of 'B' (at the same level as the 'B' corporate credit rating) with a recovery rating of '3', indicating S&P's expectation of meaningful (50%-70%) recovery for lenders in the event of a payment default. Subsidiary FairPoint Logistics Inc. is a co-borrower on both loans. "The 'B' rating reflects FairPoint's highly leveraged financial profile and weak business position as an ILEC experiencing access- line losses exceeding 10%," said Standard & Poor's credit analyst Catherine Cosentino. S&P estimates that, despite a $1.5 billion reduction in debt while in bankruptcy, pro forma leverage for 2010 will be around the mid-6x area (including S&P's operating lease and unfunded pension and OPEB adjustments). S&P expects only minimal improvement in leverage as free operating cash flow generation will be limited, in S&P's view, over the next few years. "The company has a weak business position, in its view, given high access-line losses and low DSL penetration," said Ms. Cosentino, "and S&P expects access-line losses to persist, pressuring overall revenues despite potential increases in business and consumer broadband revenues." For 2011, the company will continue to devote sizable amounts of cash to upgrade its network in the New England markets to support increased broadband penetration. Currently, overall broadband penetration is only about 25% of total switched access lines, which is at the lower end of the range for most incumbent telephone and cable operators. INDUSTRIAL ENTERPRISES: Omtammot DIP Loan Extended to July 31 ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has granted the motion of Industrial Enterprises of America, Inc., and its debtor-subsidiaries for a further extension of the term of their postpetition financing facility with Omtammot II, LP, through July 31, 2011, in accordance with a budget and to pay outstanding administrative and professional claims. On February 16, 2010, the Bankruptcy Court authorized Debtors to enter into the Financing Agreement with Omtammot II, LP, under which the lender committed to advance up to $1.5 million to Debtors, to pay administrative and professional claims, and to pay for operational expenses. On November 2, 2010, the Court authorized the continued use of the facility through January 31, 2011. Under the terms of the Final Order dated February 16, 2010, Omtammot II, LLP, is granted super-priority claims, provided that the claims of the lender under the Financing Agreement will not have priority over claims arising under Sections 105, 506(c), 726, 1113 or 114 of the Bankruptcy Code or over the fees of the Office of the United States Trustee. About Industrial Enterprises Pittsburgh, Pennsylvania-based Industrial Enterprises of America, Inc., filed for Chapter 11 protection on May 1, 2009, (Bankr. D. Del. Case No. 09-11508). On April 30, 2009, Pitt Penn Holding Co., Inc., and Pitt Penn Oil Co., LLC, each filed voluntary petitions for Chapter 11 relief, under Case Nos. 09-11475 and 09-11476. On May 4, 2009, EMC Packaging, Inc., filed a voluntary petition for Chapter 11 relief, under Case No. 09-11524. On May 6, 2009, Unifide Industries, LLC, and Today's Way Manufacturing LLC, each filed a voluntary petition for Chapter 11 relief, under Case Nos. 09-11587 and 09-11586. PPH, PPO, EMC, Unifide, and Today's Way are each subsidiaries of the Company. The cases are jointly administered under Case No. 09-11475. Christopher D. Loizides, Esq., at Loizides, P.A., in Wilmington, Del., represents the Debtors as counsel. In its petition, Industrial Enterprises listed total assets of $50,476,697 and total debts of $17,853,997. Based on public filings previously made with the Securities and Exchange Commission, Industrial Enterprises originally operated as a holding company with 4 wholly owned subsidiaries, PPH, EMC, Unifide, and Today's Way. PPH, through its wholly owned subsidiary, PPO, was a leading manufacturer, marketer and seller of automotive chemicals and additives. EMC's original business consisted of converting hydrofluorocarbon gases R134a and R152a into branded private label refrigerant and propellant products. Unifide was a leading marketer and seller of automotive chemicals and additives. Today's Way manufactured and packaged the products which were sold by Unifide. INNKEEPERS USA: Midland Tries to Block LNR Opposition to Plan ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Midland Loan Services Inc., the special servicer for $825 million in fixed-rate mortgages on property of Innkeepers USA Trust, filed papers on Feb. 1 objecting to the request by LNR Securities Holdings LLC and Appaloosa Management LP for the right to oppose the newly proposed Innkeepers reorganization structure. According to Mr. Rochelle, LNR and Appaloosa both hold some of the certificates issued by the trusts for which Midland is servicer. Midland cites chapter and verse in the governing documents to say certificate holders granted Midland the exclusive right to appear for them in bankruptcy cases. The Bloomberg report relates that Midland cites other provisions which it says mean that individual certificate holders can act in a bankruptcy only if together they hold 25% of the issue and agree to indemnify Midland. Together, Appaloosa and LNR fall "well short" of the required 25%, Midland says. LNR Objection As reported in the Feb. 3, 2011 edition of the Troubled Company Reporter, LNR Securities Holdings LLC and the trusts holding $160 million in secured claims filed papers on Jan. 25 asking the bankruptcy judge to declare that they have the right to appear in court and oppose the new reorganization structure proposed for Innkeepers USA Trust. According to Mr. Rochelle, LNR and the trusts say they oppose how the mortgages will be reduced in amount and altered. As a result, they contend they have a pecuniary interest that allows them to be heard in court. Since Five Mile Capital Partners LLC, according to the motion, holds a controlling amount of the $825 million in mortgages and is also a principal beneficiary of the reorganization, they want to ensure they can oppose. LNR holds some of the $825 million in fixed-rate mortgages on 45 properties where Midland Loan Services Inc. is acting as servic Five Mile-Lehman Plan As reported in the Jan. 25, 2011 edition of the Troubled Company Reporter, U.S. Bankruptcy Judge Shelley C. Chapman is convening hearings on March 8 and 9 to consider approval of agreements outlining a reorganization structure for Innkeepers USA Trust. At the hearing, Judge Chapman will also consider approval of an auction process to test whether anyone will top the stalking-horse bid by Five Mile Capital Partners and Lehman Ali Inc. to bankroll Innkeepers' exit and turn the Company over to creditors. Pursuant to the timetable, preliminary, non-binding, objections to the Five Mile-Lehman proposal are due Jan. 26. Deposition notices must be served by Jan. 27. Documents must be produced by Feb. 8, with examinations of witnesses under oath from Feb. 9 to 18. Final objections are due Feb. 25, with replies by March 3. As reported in the Jan. 19 edition of the Troubled Company Reporter, according to Bill Rochelle, the bankruptcy columnist for Bloomberg News, the Lehman Ali and Five Mile-sponsored Plan will reduce debt by $400 million. Mr. Rochelle relates that under the Plan: * Five Mile and Lehman Ali, together will provide $174.1 million of equity capital and convert $200.3 million of debt into equity. Five Mile is the provider of $53 million in secured financing for the Chapter 11 case, and Lehman is the holder of $238 million in floating-rate mortgages on 20 of Innkeepers' 72 properties. * Midland Loan Services Inc., as servicer for $825 million of fixed-rate mortgage debt on 45 properties, will emerge from Chapter 11 with mortgages for $622.5 million on revised terms. * Lehman is to receive 50% of the new equity plus $26.2 million cash in exchange for all its debt. The $70.5 million in secured loans for the Chapter 11 case will be paid in full. Midland is supplying debt financing for Lehman's commitment. * Unsecured creditors are being offered $2.5 million cash if the class votes for the plan. Secured lenders' deficiency claims will not participate in the distribution to unsecured creditors. Also, preference suits against unsecured creditors will be waived. * Holders of the 8% preferred stock are offered $5.9 million cash plus the right to be co-investors for 2% of the new equity. * Holders of mortgages on 69 of 72 properties will be paid in full or have the mortgages modified consensually. Lehman Ali is a subsidiary of Lehman Brothers Holdings Inc. 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. The Company's consolidated assets for 2009 totaled approximately $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred approximately $1.29 billion of secured debt. INTEGRA BANK: Bank Out of Compliance with Capital Directive ----------------------------------------------------------- Integra Bank Corporation, the parent company of Integra Bank N.A., commented Monday on the financial results for the fourth quarter of 2010 reflected in Integra Bank's Call Report that was filed with the Federal Deposit Insurance Corp. on January 30, 2011. The Bank reported a net loss for the fourth quarter of 2010 of $35.4 million. Net interest income declined $2.2 million from the third quarter of 2010 to $10.1 million, primarily due to a lower volume of earning assets and lower earning asset yields resulting from three multi-branch and loan sale transactions closed in the third quarter. The provision for loan losses increased $5.1 million to $31.4 million, while net charge-offs increased $4.7 million to $31.6 million. Non-interest income declined $19.4 million from the third quarter of 2010 to $7.9 million and included $2.5 million of securities gains from sales, primarily because the third quarter of 2010 included $20.7 million of deposit premiums and loan sale gains resulting from the branch and loan sales. Non-interest expense decreased $5.1 million from the third quarter of 2010 to $23.5 million in part due to lower branch related expenses following the third quarter branch and loan sales. "Our core community banking business continued to perform well, however, the persistent weakness in commercial real estate markets continues to put intense pressure on our recovery and has resulted in our current quarterly loss," stated Mike Alley, Chairman and CEO. "Our credit teams have made tremendous progress in reducing our exposure to this industry segment but the prolonged weakness in the economy and continued deterioration in real estate values have resulted in greater charge-offs and increased reserves," added Mr. Alley. Integra Bank's total risk-based capital ratio declined 168 basis points to 7.66% from September 30, 2010, its tier 1 risk-based capital ratio decreased 168 basis points to 6.34% and its tier 1 leverage ratio decreased 77 basis points to 3.54%. The decline in these ratios during the quarter means that Integra Bank no longer meets the minimum capital levels to be considered adequately capitalized. Integra Bank is not currently in compliance with a Capital Directive issued by the Office of the Comptroller of the Currency. The Directive required Integra Bank to submit a capital plan to achieve these capital levels; the OCC has since advised Integra Bank that its plan was not accepted. As a result, additional actions by the OCC are expected. The Company's auditors have advised management that unless the Company is able to obtain firm commitments for a substantial capital infusion before the release date of their report on the Company's 2010 consolidated financial statements, that report will indicate that there is substantial doubt concerning the Company's ability to continue as a going concern. About Integra Bank Corp. Headquartered in Evansville, Indiana, Integra Bank Corporation (Nasdaq CM: IBNK) -- http://www.integrabank.com/-- is the parent of Integra Bank N.A. As of December 31, 2010, the Bank has $2.4 billion in total assets. Integra Bank currently operates 52 banking centers and 100 ATMs at locations in Indiana, Kentucky, and Illinois. As of September 30, 2010, Integra Bank Corporation had $2.627 billion in total assets, $2.595 billion in total liabilities, and stockholders' equity of $31.9 million. IRVING TANNING: Tasman Industries Buys Business for $6.5 Million ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Maine has authorized Irving Tanning Co. to sell its business to Tasman Industries Inc. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, Tasman will forgive a $1 million debt owing by Irving. In addition, Tasman will pay $3.3 million in cash and notes to The Fund of Jupiter LLC, a secured lender. Scott Monroe at the Morning Sentinel reports that a person with knowledge of the sale said the deal could close by the end of this week, but that some details still need to be worked out. Tasman, which has hide processing facilities in Iowa, Nebraska and Kentucky, has pledged to keep the workforce intact at Prime Tanning's Hartland facility, according to the Morning Sentinel. The Morning Sentinel relates that, to fund the Chapter 11 case, Prime Tanning has received approval for a $550,000 loan from the Maine Rural Development Authority and a $4 million credit line from Porter Capital. About Irving Tanning Irving Tanning Company, also known as IT Acquisition Corporation and Prime Tanning-Hartland, is a producer and seller of leather for shoes and handbags from Hartland, Maine. It had about 180 employees in Hartland, Maine, Irving Tanning filed for bankruptcy protection on Nov. 16, 2010. It was the third time the tannery had filed for bankruptcy in the last decade. Irving Tanning Company (Bankr. D. Maine Case No. 10-11757), Prime Tanning Co., Inc. (Case No. 10-11758), Prime Tanning Corp. (Case No. 10-11759) filed separate chapter 11 petitions. Irving Tanning estimated assets of $1 million to $10 million and debts of $10 million to $50 million. Another affiliate Prime Tanning Company Inc. filed for Chapter 11 bankruptcy protection on Dec. 30, 2011 (Bankr. D. Maine Lead Case No. 10-11949). IRVING TANNING: Tasman Industries Offers $6.5 Million for Assets ---------------------------------------------------------------- Scott Monroe at the Morning Sentinel reports that owners of Tasman Industries Inc. of Louisville, Kentucky, placed a $6.5 million bid for Prime Tanning. A person with knowledge of the sale said the deal could close by the end of this week, but that some details still need to be worked out. Tasman, which has hide processing facilities in Iowa, Nebraska and Kentucky, has pledged to keep the workforce intact at Prime Tanning's Hartland facility. According to the Morning Sentinel, to fund the Chapter 11 case, Prime Tanning has received approval for a $550,000 loan from the Maine Rural Development Authority and a $4 million credit line from Porter Capital. About Prime Tanning Irving Tanning Company, also known as IT Acquisition Corporation and Prime Tanning-Hartland, is a producer and seller of leather for shoes and handbags from Hartland, Maine. It had about 180 employees in Hartland, Maine, Irving Tanning announced on Nov. 16, 2010, it had filed for bankruptcy protection. It was the third time the tannery had filed for bankruptcy in the last decade. Irving Tanning Company (Bankr. D. Maine Case No. 10-11757), Prime Tanning Co., Inc. (Case No. 10-11758), Prime Tanning Corp. (Case No. 10-11759) filed separate chapter 11 petitions. Irving Tanning estimated assets of $1,000,001 to $10,000,000 and debts of $10,000,001 to $50,000,000. Another affiliate Prime Tanning Company Inc. filed for Chapter 11 bankruptcy protection on Dec. 30, 2011 (Bankr. D. Maine Lead Case No. 10-11949). Robert J. Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the Debtors. JAMES F BYRNES: Chapter 11 Filing Halts Bank's Auction ------------------------------------------------------ James F. Byrnes Academy in Quinby, South Carolina, has filed for Chapter 11 reorganization (Bankr. D. S.C. Case No. 11-00538). WMBF News reports the filing came before the school property was to be auctioned off by First Citizens Bank. The Debtor disclosed in its list of creditors that it has a $1,063,624 secured debt and $536,376 unsecured debt to First Citizens Bank. According to the report, First Citizens demanded payment in full for the loan the school took out with the bank in 2007. The bank took steps to foreclose the loan last year when the school was unable to pay and scheduled to auction off the property on Feb. 1, 2011. Classes in the school remain in session while officials are preparing a restructuring plan. Officials are targeting a repayment plan by the start of the 2011-2012 school year. "We will not close down. We have a viable business plan. We're going to continue to educate the children of the Pee Dee for the next 50 years," John Isgett said, former Chairmen of the Board of Trustees of The Byrnes Schools. The Byrnes Schools was established in Quinby in 1965. It is the only non-for-profit private institution that teaches children from pre kindergarten to 12th grade. JAMES F BYRNES: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: James F. Byrnes Academy dba The Byrnes Schools 1201 E. Ashby Road Florence, SC 29506 Bankruptcy Case No.: 11-00538 Chapter 11 Petition Date: January 31, 2011 Court: U.S. Bankruptcy Court District of South Carolina (Columbia) Judge: Chief Judge John E. Waites About the Debtor: The Byrnes Schools was established in Quinby, South Carolina in 1965. It is a non-for-profit private institution that teaches children from pre kindergarten to 12th grade. Debtor's Counsel: H. Flynn Griffin, III, Esq. P.O. Box 76 Columbia, SC 29202-0076 Tel: (803) 252-8600 Fax: (803) 256-0950 E-mail: kim@andersonlawfirm.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/scb11-00538.pdf The petition was signed by Thomas P. Goodson, president. KE KAILANI: Sec. 341 Meeting of Creditors Set for February 11 ------------------------------------------------------------- The United States Trustee for Region 15 will convene a meeting of the creditors of Ke Kailani Development, LLC, on February 11, 2011, at 2:00 p.m., at the U.S. Trustee Meeting Room, 1132 Bishop Street, Suite 606, in Honolulu, Hawaii. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in the Debtor's bankruptcy case. Attendance by the Debtor's creditors at the meeting is welcome but not required. The Sec. 341 meeting offers the creditors a one-time opportunity to examine the Debtor's representative under oath about its financial affairs and operations that would be of interest to the general body of creditors. About Ke Kailani Development Honolulu, Hawaii-based Ke Kailani Development, LLC, is a company formed by ex-Home Box Office Chief Executive Michael Fuchs that planned to develop a $100 million luxury home subdivision on the Big Island. The Company sought Chapter 11 protection on January 5, 2011 (Bankr. D. Hawaii Case No. 11-00019). Gary Victor Dubin, Esq., at Dublin Law Offices, in Honolulu, represents the Debtor. The Debtor estimated assets and debts of $10,000,001 to $50,000,000 in its Chapter 11 petition. The bankruptcy filing listed an affiliate of Texas-based Hunt Cos. as the largest creditor, at $22 million, The AP relates. KE KAILANI: Files Schedules of Assets and Liabilities ----------------------------------------------------- Ke Kailani Development, LLC, filed with the U.S. Bankruptcy for the District of Hawaii its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $43,000,000 B. Personal Property $573,092 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $26,114,861 E. Creditors Holding Unsecured Priority Claims $833,154 F. Creditors Holding Unsecured Non-priority Claims $1,190,753 ----------- ----------- TOTAL $43,573,092 $28,138,768 A copy of the Schedules of Assets & Liabilities is available for free at http://bankrupt.com/misc/KeKailani.SAL.pdf About Ke Kailani Development Honolulu, Hawaii-based Ke Kailani Development, LLC, is a company formed by ex-Home Box Office Chief Executive Michael Fuchs that planned to develop a $100 million luxury home subdivision on the Big Island. The Company sought Chapter 11 protection on January 5, 2011 (Bankr. D. Hawaii Case No. 11-00019). Gary Victor Dubin, Esq., at Dublin Law Offices, in Honolulu, represents the Debtor. The Debtor estimated assets and debts of $10,000,001 to $50,000,000 in its Chapter 11 petition. KGEN LLC: S&P Changes Outlook to Positive, Affirms 'BB-' Ratings ---------------------------------------------------------------- Standard & Poor's Ratings Services revised the outlook on KGen LLC's senior secured credit facilities to positive from negative. At the same time, S&P affirmed the 'BB-' ratings on these facilities. The '1' recovery rating on the credit facilities remains unchanged. The outlook revision reflects the likelihood that KGen will repay its debt with the expected proceeds from the sale of the Murray plants (1,250 MW) to Oglethorpe Power Corporation, a power supply cooperative, for about $531 million or $425 per kW (subject to working capital and spare parts inventory adjustments). L-3 COMMUNICATIONS: Fitch Expects to Rate New Senior Unsec. Notes ----------------------------------------------------------------- Fitch Ratings expects to rate L-3 Communications Corporation's new senior unsecured notes 'BBB-'. L-3 plans to issue $650 million of senior unsecured 10-year notes which will be pari passu with the existing unsecured notes due 2019 and 2020. Proceeds are to be used to redeem the 5.875% senior subordinated notes due 2015, and the company's total debt is expected to remain largely unchanged, although the repayment of senior subordinated notes will result in a higher level of senior unsecured debt in the company's capital structure. L-3's existing ratings are: L-3 Communications Holdings, Inc. -- Issuer Default Rating 'BBB-'; -- Contingent convertible subordinated notes 'BB+'. L-3 Communications Corporation -- IDR 'BBB-'; -- Existing and newly issued senior unsecured notes 'BBB-'; -- Senior unsecured revolving credit facility 'BBB-'; -- Senior subordinated debt 'BB+'. Fitch will withdraw the ratings on the 5.875% senior subordinated notes due 2015 when the notes are retired. The Rating Outlook remains Stable. The ratings cover approximately $4.1 billion of debt outstanding. The senior subordinated notes remain one notch below the IDR and senior unsecured debt due to contractual subordination. Key factors that support the ratings include L-3's solid credit metrics, liquidity position, and Fitch's expectation of steady operating margins and substantial free cash flow (cash from operations less capital expenditures and dividends, FCF) which totaled $1.1 billion in 2010. Other positive factors include high levels of defense spending; L-3's diverse portfolio of products and services that are in line with the Department of Defense requirements; and a balanced contract mix, including generation of more than 50% of revenues from the Operations & Maintenance account in the DOD budget. Concerns relate to the potential for larger debt-financed acquisitions, core U.S. defense spending trends after fiscal 2012, the longer-term outlook for supplemental DOD budgets related to operations in Iraq and Afghanistan, and the underfunded pension position. The rating and Outlook incorporate Fitch's expectations of small- to medium-sized acquisitions and meaningful cash deployment toward shareholders which totaled approximately $1.8 billion in 2010 with $753 million utilized for acquisitions, $834 million for share repurchases and $184 in dividend payments. An upward revision to the rating could occur if L-3 moderated its acquisition strategy, kept spending within free cash flow, and focused capital on improving the credit profile. Alternatively, Fitch could consider a downward revision to the ratings or Outlook if L-3 completed a large debt-funded acquisition, unless some equity was used to limit the increase in leverage. A downgrade is also possible if the company's end-markets show substantial deterioration which is viewed as unlikely in the near to medium term. L-3 has historically generated strong FCF through sales growth, strong operating performance, working capital management, and acquisitions. In 2010, the company generated $1.3 billion of FCF before dividends, an approximately 5% increase from $1.2 billion reported in 2009. Healthy FCF generation is attributable to effective merger integration management, working capital management and low capital expenditures as a percentage of sales. In 2010, L-3 incurred capital expenditures of $181 million or 1.1% of sales, which is in line with its historic average of 1.3% from 2006 to 2009. L-3 forecasts 2011 FCF before dividends to be slightly lower, with capex rising, partly due to purchasing some leased assets. While cash generation is forecasted to remain very healthy in 2011, Fitch does not expect to see debt reduction become a priority for L-3. Historically, the company has directed cash to acquisitions, share repurchases and dividends. In Fitch's view, acquisitions remain the main risk to the credit profile. Total acquisition spending was $753 million in 2010. In general, Fitch believes acquisition activity in the defense sector will increase in 2011, and L-3 is a likely acquirer of small and medium sized assets, although Fitch believes larger transactions are a possibility. Share repurchases have also been a significant use of cash and a new $1 billion share repurchase program was authorized in July 2010; it extends through Dec. 31, 2012. In 2010, the company repurchased $834 million of common shares, up from $505 million during 2009. Fitch expects to see a total of $500 million to $550 million spent on share repurchases in 2011, although this could move higher depending on the level of acquisition spending. As of Dec. 31, 2010, leverage defined as debt-to-EBITDA was 2.1 times, a modest increase from 2.0x at the end of 2009. Liquidity remains healthy in Fitch's view. L-3 had a liquidity position of approximately $1.6 billion, consisting of $607 million of cash and $983 million of availability under the revolving credit facility expiring in October 2012. L-3 has $700 million of convertible debt outstanding. The notes bear interest of 3% and the final maturity date is 2035. The notes were puttable on Feb. 1, 2011, and Fitch understands that only a modest amount were put to L-3. The next put date is Feb. 1, 2016. At the end of 2009, L-3's pension plan was 66% funded, or $660 million underfunded. While L-3's pension contributions increased in 2010 to $186 million from $67 million, Fitch believes that L-3 will continue having a large funding deficit over the next several years due to a decline in the discount rate to 5.6% from 6.3%. This is currently a common issue for pension plans in the industrial sector. As a defense contractor L-3 can factor in certain pension costs as allowable expenses in some government contracts although there can be timing issues for cash flows. L-3's credit quality continues to be supported by large U.S. defense budgets. U.S. defense spending trends are key drivers of the company's financial performance given that the company generates approximately 76% of its revenues from the DOD. Core U.S. defense spending should continue to rise in fiscal 2011 and 2012, so the general outlook for the sector is still favorable in the near term, although the growth rate has fallen and there will likely be some program cuts. Supplemental funds for operations in Iraq and Afghanistan should trend down in the next few years. Risks to the U.S. defense outlook include margin pressures from tougher contract terms; cash deployment actions to offset lower growth; and pressure on spending after fiscal 2012 due to fiscal challenges. Fitch believes that L-3 has credit metrics strong enough to withstand lower defense spending levels while retaining the current ratings. L-3 COMMUNICATIONS: Moody's Affirms 'Ba1' Sr. Subordinated Ratings ------------------------------------------------------------------ Moody's Investors Service has assigned a Baa3 rating to the planned $650 million senior unsecured 10-year notes of L-3 Communications Corporation. All other ratings of L-3 have been affirmed, including the senior subordinated ratings of Ba1. The rating outlook is stable. Moody's views the transaction as net neutral to credit metrics and consistent with the company's plans of replacing subordinated debt with senior unsecured debt, furthering migration toward a capital structure more characteristic of investment grade. The company intends to use issuance proceeds to fund the planned call of its $650 million 5.875% senior subordinated notes due 2015. The new notes will be guaranteed by the company's material domestic subsidiaries and will be senior in right of payment to L- 3's existing senior subordinated notes, of about $1,000 million as of September 2010 (excluding the subordinated notes to be called), and about $700 million of L-3 Communications Holdings, Inc.'s 3% convertible contingent notes due 2035 (CODES) that are guaranteed on a subordinated basis by L-3. The company's Baa3 senior unsecured rating reflects L-3's scale, diversity of defense services and product revenues, good return on assets, and expectation of continued free cash flow to debt in the double digit percentage range. The stable outlook assumes 2011 combined acquisition and stock repurchase spending will not materially increase debt, with debt to EBITDA remaining below 3.0 times. Upward rating momentum could grow over time with debt to EBITDA sustained below 2.5 times, free cash flow to debt above 15%, a diminishing level of subordinated debt in the capital structure, and a solid liquidity profile. Downward rating momentum could develop if the company were to add leverage from spending on acquisitions or equity rewards; debt to EBITDA exceeding 3.0 times for a material time period, EBIT to interest below 4.0 times, or free cash flow to debt of 10% or less would negatively pressure the rating. L-3 Communications Corporation Ratings assigned, subject to review of final documentation: * $650 million guaranteed senior unsecured notes due February 2021, Baa3 Ratings affirmed: * $1000 million 5.20% guaranteed senior unsecured notes due October 2019, Baa3 * $800 million 4.75% guaranteed senior unsecured notes due July 2020, Baa3 * $650 million 5.875% guaranteed senior subordinate notes due January 2015, Ba1 (to be withdrawn following completion of the call) * $1000 million 6.375% guaranteed senior subordinate notes due October 2015, Ba1 L-3 Communications Holdings, Inc. Ratings affirmed: * $700 million 3% guaranteed convertible contingent notes due 2035 (CODES), Ba1 L-3 Communications Holdings, Inc., is a prime contractor in aircraft modernization and maintenance, C3ISR (Command, Control, Communications, Intelligence, Surveillance and Reconnaissance) systems, and government services. In addition, L-3 provides high technology products, systems and subsystems. Revenues in 2010 were approximately $15.7 billion. LA PALOMA'S: Moody's Affirms 'Caa2' on 2nd Lien Debt Facility ------------------------------------------------------------- Moody's Investors Service affirmed La Paloma's Generating Company B3 and Caa2 rating on its 1st and 2nd lien debt facilities, respectively, and changed the outlook to stable. Ratings Rationale The rating action reflects the Project's improved financial performance with DSCR of 1.24x and 5% FFO/Debt according to Moody's calculations for the last twelve months ended September 2010 compared to below 1.0x DSCR and FFO/Debt around zero prior to 2009. The improvement in La Paloma's financial performance is primarily driven by improved operational performance since 2009 and expiration of out of the money interest rate swaps. Additionally, the rating action considers La Paloma's repayment of its expiring working capital facility in August 2010 with a smaller sponsor provided working capital facility. These positive developments though are weighed down by scheduled major maintenance events in 2011 that are expected to negatively pressure cash flow, the 1st and 2nd lien term loan maturities in August 2012 and 2013, respectively, and the expiration of La Paloma's PPA in December 2012. Moody's notes that La Paloma has only paid down roughly 6% of total debt since the end of 2005 while the Project's financial metrics continue to remain low. These challenges result in a high probability of default at La Paloma and continue to restrain the Project's rating at B3 and Caa2 for the first and second lien debt. Moody's also considered potentially significant losses on the 2nd lien debt in a default based on the historical cash flow of the Project. The stable outlook reflects the expectation for operating performance commensurate with recent improved levels and maintenance of at least 1.2x DSCR for the next 12 months. The rating could improve if La Paloma is able to enter into new offtake contracts, maintains improved financial metrics, sustains improved operating performance and makes significant progress in addressing its upcoming debt maturities. La Paloma's rating could be negatively affected if the Project incurs major operational problems or is unable to extend or refinance its maturing debt facilities. La Paloma Generating Co. LLC owns a 1,022 MW natural gas-fired, combined cycle generating facility located in Kern County, California. La Paloma is owned by a group of institutional investors. The last rating action on La Paloma occurred on December 1, 2009, when the 1st and 2nd lien debt was downgraded to B3 and Caa2, respectively. LANDCO FAIR: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Landco Fair Oaks Development LP 910 Fair Oaks Rd. Houston, TX 77023 Bankruptcy Case No.: 11-31105 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Jeffery Dayne Carruth, Esq. WEYCER, KAPLAN, PULASKI & ZUBER, P.C. 3030 Matlock Rd., Suite 201 Arlington, TX 76015 Tel: (817) 795-5046 Fax: (800) 556-1869 E-mail: jcarruth@wkpz.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/txsb11-31105.pdf The petition was signed by Mark D. Lester, president of Debtor's general partner. LANDCO JEFFERSON: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Landco Jefferson House Development LP 6200 Gulfton Houston, TX 77081 Bankruptcy Case No.: 11-31103 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Letitia Z. Paul Debtor's Counsel: Jeffery Dayne Carruth, Esq. WEYCER, KAPLAN, PULASKI & ZUBER, P.C. 3030 Matlock Rd., Suite 201 Arlington, TX 76015 Tel: (817) 795-5046 Fax: (800) 556-1869 E-mail: jcarruth@wkpz.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 Mark D. Lester, president of Debtor's general partner. LEHMAN BROTHERS: Settles LB Bankhaus Intercompany Claims -------------------------------------------------------- Lehman Brothers Holdings Inc. and the insolvency administrator for Lehman Brothers Bankhaus AG, the second largest of LBHI's foreign affiliates, have reached an agreement settling all intercompany relationships between the U.S. Debtors and LB Bankhaus. The agreement, which is subject to approval in the U.S. Chapter 11 proceedings and in the German proceeding, provides for the allowance of LB Bankhaus' claims in the approximate amount of $6.6 billion. LB Bankhaus also said it is supportive of the First Amended Joint Chapter 11 plan filed on January 26, 2011. Bryan Marsal, LBHI's Chief Executive Officer, said: "This agreement is a milestone in the resolution of the Lehman proceedings and is in line with our overall approach to favor compromises with affiliates and avoid lengthy and costly litigation. We look forward to continuing our conversations with affiliates and other stakeholders in the coming months as we move forward toward confirmation of the amended plan." Dr. Michael C. Frege, in his capacity as insolvency administrator for LB Bankhaus, stated: "We have worked for many months with LBHI to reach this mutually satisfactory settlement of all intercompany issues between our two estates. In addition, LB Bankhaus is supportive of the First Amended Joint Chapter 11 plan and the approval of the Debtors' Disclosure Statement and hopes the process will now move forward expeditiously." 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) LHB REAL: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------ Debtor: LHB Real Estate, L.L.C. c/o Kevin J. Owens 209 Watersong Ln Georgetown, TX 78628-6954 Bankruptcy Case No.: 11-10282 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: B. Weldon Ponder, Jr., Esq. Building 3, Suite 200 4601 Spicewood Springs Rd Austin, TX 78759-7841 Tel: (512) 342-8222 Fax: (512) 342-8444 E-mail: welpon@austin.rr.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 three largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txwb11-10282.pdf The petition was signed by Kevin J. Owens, agent for general partner, Bastrop Blackhawk, LLC. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Bastrop Blackhawk, LLC 11-10273 02/01/2011 LIONS GATE: Files Schedules of Assets and Liabilities ----------------------------------------------------- Lions Gate Ventures, Inc., filed with the U.S. Bankruptcy for the Central District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $14,110,390 B. Personal Property $0 C. Property Claimed as Exempt $12,874,757 D. Creditors Holding Secured Claims $0 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims ----------- ----------- TOTAL $14,110,390 $12,874,757 A copy of the Schedules of Assets & Liabilities is available for free at http://bankrupt.com/misc/LionsGate.SAL.pdf About Lions Gate Corona, California-based Lions Gate Ventures, Inc., dba Lions Gate Ventures, filed for Chapter 11 bankruptcy protection on January 5, 2011 (Bankr. C.D. Calif. Case No. 11-10409). Terrell Proctor, Esq., who has an office in Woodland Hills, California, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. LOUISVILLE ORCHESTRA: Struggles to Meet Payroll Obligation ---------------------------------------------------------- Elizabeth Kramer at the Courier-Journal, in Louisville, Kentucky, reports that the Louisville Orchestra will again struggle to meet its payroll under a court order, two months after filing for Chapter 11 bankruptcy. According to the Courier-Journal, the orchestra wants to reinvent itself as a much leaner operation -- with fewer musicians, fewer work weeks and an annual operating budget that's more than a million dollars smaller. While financial challenges are nothing new to the Louisville Orchestra, this year it has plenty of company. Orchestras nationwide are feeling the economic pinch, including: * The Honolulu Symphony that went through Chapter 7 bankruptcy and liquidated in 2009. * The Indianapolis Symphony that ended 2010 with a $2.7 million deficit -- the second straight year in which the orchestra lost money -- even after musicians agreed to a 12 percent pay cut. * Colorado Springs Symphony that ceased operations. * The Nashville Symphony Orchestra was in a similar situation as Louisville's after the economic crash of the 1980s -- but it managed to stay intact. 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. LYONDELL CHEMICAL: BASF Wants Continuing Stay Lifted ---------------------------------------------------- Bankruptcy Law360 reports that BASF Corp. is fighting to obtain more than $135 million in contract damages that Lyondell Chemical Co. maintains are snuffed out by the confirmation of its Chapter 11 plan. According to Law360, BASF asked Judge Robert E. Gerber of the U.S. Bankruptcy Court for the Southern District of New York to lift the continuing stay on the Lyondell case. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. Luxembourg-based Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the USUS$12.7 billion merger. Len Blavatnik's Access Industries owned the Company prior to its bankruptcy filing. On January 6, 2009, LyondellBasell Industries' U.S. operations, led by Lyondell Chemical Co., and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities filed for Chapter 11. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, served as the Debtors' bankruptcy counsel. Evercore Partners served as financial advisors, and Alix Partners and its subsidiary AP Services LLC, served as restructuring advisors. AlixPartners' Kevin M. McShea acted as the Debtors' Chief Restructuring Officer. Clifford Chance LLP served as restructuring advisors to the European entities. LyondellBasell emerged from Chapter 11 bankruptcy protection in May 2010, with a plan that provides the Company with US$3 billion of opening liquidity. A new parent company, LyondellBasell Industries N.V., incorporated in the Netherlands, is the successor of the former parent company, LyondellBasell Industries AF S.C.A., a Luxembourg company that is no longer part of LyondellBasell. LyondellBasell Industries N.V. owns and operates substantially the same businesses as the previous parent company, including subsidiaries that were not involved in the bankruptcy cases. LyondellBasell's corporate seat is Rotterdam, Netherlands, with administrative offices in Houston and Rotterdam. MARITIME TELECOMMUNICATIONS: S&P Assigns 'B' Corp. Credit Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'B' corporate credit rating to Miramar, Fla.-based satellite services provider Maritime Telecommunications Network Inc. The outlook is stable. At the same time, S&P assigned a preliminary 'B+' issue-level rating and '2' recovery rating to the company's proposed $110 million senior secured term loan and $10 million revolver. The '2' recovery rating indicates S&P's expectation of substantial (70% to 90%) recovery in the event of payment default. The company intends to use the proceeds from the term loan to repay about $84 million of outstanding debt, pay a $20 million distribution to shareholders, add $1 million of cash to the balance sheet, and pay related fees and expenses. S&P expects funded debt to total about $110 million when the transaction closes. "The ratings on MTN reflect its narrow scope of business, revenue concentration among large customers with significant pricing power, uncertain growth prospects from new business lines, and a highly leveraged financial risk profile, including elevated pro forma operating lease-adjusted leverage of about 6.2x," said Standard & Poor's credit analyst Allyn Arden. "Tempering factors include the company's leading niche position in providing communications services to the North American cruise industry, its stability from long-term contractual revenue, and its solid net free cash flow generation." MTN provides customized satellite-based communications services to ocean vessels and offshore oil and gas drilling platforms. The company focuses on the North American cruise line industry and serves about 200 ships, which generate approximately 63% of total revenue. The company derives the remaining 37% of its revenue from the oil and gas, government/military, yacht, and aviation segments. MTN's EBITDA margin, including contributions from the wireless joint venture, is solid at about 30%, as of the September 2010 quarter, but has weakened materially over the last few years because of higher transponder costs, price concessions during contract renewals, and a mix shift to lower margin segments. S&P expects some margin degradation over the next year because of these factors. Pro forma debt to EBITDA is elevated for the rating level at about 6.2x. Despite the company's elevated leverage, S&P expects modest improvement in credit measures over the next couple of years from EBITDA growth and net free cash flow, a portion of which will be used for debt repayment as per the credit agreement. "The outlook is stable and reflects S&P's expectation that business trends will modestly improve in the core cruise segment, offset by uncertain growth prospects from new business lines and the company's elevated leverage," said Mr. Arden. S&P could lower the rating if leverage rises above 7x due to higher transponder costs, pricing pressure, or disappointing growth from new business ventures. For example, S&P calculate that a 15% decline in EBITDA in 2011 compared with 2010 would lead to leverage exceeding 7x. Conversely, S&P could raise the ratings if MTN is able to profitably grow its new business segments such that leverage declines to the low-5x area on a sustained basis. MICHAEL A HARRIS: Billing Protocol Not Applicable for Small Case ---------------------------------------------------------------- Bankruptcy Judge John K. Olson denied Michael A. Harris' request for reconsideration of a prior Court order denying his bid for procedures for monthly billing and payment of interim professional fees in the case. The Court held that the case does constitute a "larger chapter 11 case". Judge Olson recounted that he denied the fee procedures motion for two reasons -- (a) for lack of prosecution because the Debtor's counsel failed to appear at the scheduled hearing. Counsel asserts in the reconsideration motion that the failure to appear was the result of excusable neglect; and (b) on the merits. Judge Olson held that Local Rule 2016-1(B)(3)(b) provides in relevant part that "[i]n larger chapter 11 cases . . . the court . . . may consider approval for monthly payment of interim fee applications for chapter 11 professionals." The purpose of this deviation from the general provisions of 11 U.S.C. Sec. 331, which provides for professional fee applications not more often than every 120 days, is to prevent excessive financial burden on professionals in larger Chapter 11 cases. Judge Olson held that the Harris case involves a chapter 11 Debtor whose schedules value his assets -- principally real estate -- at $1,106,995, and states that his liabilities are $2,394,296.16, of which $2,103,372.00 are secured. Judge Olson said the case is in chapter 11 only because the secured debts exceed the chapter 13 maximum of $1,010,650 -- but not by so much as to turn this case into a "larger chapter 11 case." "I shall not attempt to define what does constitute a `larger chapter 11 case' because I do not need to do so here," Judge Olson wrote. "As Justice Potter Stewart noted, in a somewhat different context, 'I know it when I see it, and ... this case is not that.'" The case is In re: Michael A. Harris, (Bankr. S.D. Fla. Case No. 10-16587). The bankruptcy case was commenced March 16, 2010. A copy of the January 5, 2011 Order is available at http://is.gd/NkWWnMfrom Leagle.com. MIKE V REAL ESTATE: Files Schedules of Assets & Liabilities ----------------------------------------------------------- Mike V. Real Estate, LLC, has filed with the U.S. Bankruptcy Court for the Southern District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities --------------- ------ ----------- A. Real Property $ 55,000,000 B. Personal Property $0 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $32,000,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $19,335,000 ----------- ----------- TOTAL $55,000,000 $51,335,000 A copy of the Schedules of Assets and Liabilities is available for free at http://bankrupt.com/misc/MIKE_V_sal.pdf La Jolla, California-based Mike V. Real Estate, LLC, filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. S.D. Calif. Case No. 11-01165). Craig E. Dwyer, Esq., who has an office in San Diego, California, serves as the Debtor's bankruptcy counsel. MIKE V REAL ESTATE: Section 341(a) Meeting Scheduled for March 1 ---------------------------------------------------------------- The U.S. Trustee for Region 15 will convene a meeting of Mike V. Real Estate, LLC's creditors on March 1, 2011, at 10:30 a.m. The meeting will be held at the Office of the U.S. Trustee, 402 W. Broadway (use C Street Entrance), Suite 1360, Hearing Room B, San Diego, CA 92101. 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. La Jolla, California-based Mike V. Real Estate, LLC, filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. S.D. Calif. Case No. 11-01165). Craig E. Dwyer, Esq., who has an office in San Diego, California, serves as the Debtor's bankruptcy counsel. According to its schedules, the Debtor disclosed $55,000,000 in assets and $51,335,000 debts. MORTGAGES LTD: Judge Nixes Appeal on ML Manager & Borrowers Deal ---------------------------------------------------------------- Bankruptcy Law360 reports that Federal Judge Mary H. Murguia has thrown out a bankruptcy appeal lodged by investors who challenged settlements reached by ML Manager LLC, which is the loan manager of Mortgages Ltd., and a group of borrowers. About Mortgages Ltd. Phoenix, Arizona-based Mortgages Ltd. -- http://www.mtgltd.com/ -- acted as a full service private lender prior to filing for bankruptcy. Through its licensed broker dealer, Mortgages Ltd. Securities, ML received money raised from approximately 2,700 investors for placement into loans secured by real estate located solely in Arizona. These accredited investors financed the lending operations of ML and received as collateral for their funding direct fractional interests in "pass through" loans and deeds of trust or membership interests in "Opportunity Funds" which held fractionalized interests in loans and deeds of trust. Mortgages Ltd. was the subject of an involuntary Chapter 7 petition dated June 20, 2008, filed by KGM Builders Inc. -- a contractor for Grace Communities, a borrower of the company -- in the U.S. Bankruptcy Court for the District of Arizona. Central & Monroe LLC and Osborn III Partners LLC, divisions of Grace Communities, sought the appointment of an interim trustee for Mortgages Ltd. in the Chapter 7 proceeding. Mortgages Ltd. is also facing lawsuits filed by Grace Communities and Rightpath Limited Development Group for its alleged failure to fully fund loans. Mortgages Ltd. denied the charges. It has filed a motion to dismiss the Rightpath suit. The Debtor's case was converted to a chapter 11 proceeding on June 24, 2008 (Bankr. D. Ariz. Case No. 08-07465). Judge Sarah Sharer Curley presides over the case. Carolyn Johnsen, Esq., and Bradley Stevens, Esq., at Jennings, Strouss & Salmon P.L.C., replaced Todd A. Burgess, Esq., at Greenberg Traurig LLP, as counsel to the Debtor. As of December 31, 2007, the Debtor had total assets of $358,416,681 and total debts of $350,169,423. The Debtor recently emerged from Chapter 11 bankruptcy with an approved reorganization plan. MSR RESORT: Receives Loan Offers From Singapore & Paulson --------------------------------------------------------- MSR Resort Golf Course LLC and its affiliates, owners of the Grand Wailea Resort Hotel & Spa in Hawaii and four other luxury resorts in bankruptcy, received two competing loan offers, one from the Singapore government, Tiffany Kary at Bloomberg News reports, citing a lawyer for the properties' owner. The government of Singapore already invested in two mezzanine loans in the Company valued at $250 million and $110 million. Paulson & Co., a New York-based hedge fund that seized the resorts in a foreclosure auction last week, offered the other loan with Five Mile Capital Partners LLC, said Paul Basta, Esq., at Kirkland & Ellis, LLP. MSR will consider both offers for a so-called debtor-in-possession loan to fund the resorts in bankruptcy, Mr. Basta told U.S. Bankruptcy Judge Sean H. Lane at a hearing Feb. 2 in Manhattan, according to the Bloomberg report. MSR will work with adviser Houlihan Lokey Howard & Zukin Capital Inc. for the next 30 days on the issue, he said. "We'll be back to court very soon with a proposal for financing that's the best we're able to obtain," Mr. Basta said. Judge Lane has approved the resorts' request to use the lenders' cash collateral on an interim basis. About MSR Resort On January 28, 2011, CNL-AB LLC acquired the equity interests in a portfolio of eight iconic U.S. resort properties with over 5,500 guest rooms known as MS Resorts through a foreclosure proceeding on January 28, 2011. CNL-AB LLC is a joint venture consisting of affiliates of Paulson & Co. Inc., a joint venture affiliated MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc., owns a portfolio of eight luxury hotels including the Arizona Biltmore Resort & Spa in Phoenix, the Ritz-Carlton in Orlando, Fla. and Hawaii's Grand Wailea Resort Hotel & Spa in Maui. Following the acquisition, five of the resorts with mortgage debt scheduled to mature Feb. 1, 2011, were sent to Chapter 11 by the Paulson and Winthrop joint venture affiliates. MSR Resort Golf Course LLC and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan on Feb. 1. The resorts subject to the filings are Grand Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta Resort and Club and PGA West, Doral Golf Resort and Spa, and Claremont Resort and Spa. James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O. Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The five resorts had $2.2 billion in assets and $1.9 billion in debt as of Nov. 30, 2010, according to court filings. MTM PARTNERS: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: MTM Partners, L.L.C. 323 Page Bacon Road, Suite 17 Mary Esther, FL 32569 Bankruptcy Case No.: 11-30123 Chapter 11 Petition Date: February 1, 2011 Court: U.S. Bankruptcy Court Northern District of Florida (Pensacola) Debtor's Counsel: Jason Royce Mosley, Esq. GALLOWAY, JOHNSON, TOMPKINS, ET AL 118 E. Garden Street Pensacola, FL 32502 Tel: (850) 436-7000 Fax: (850) 436-7099 E-mail: jmosley@gjtbs.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Gary McMichael, president. MYSPACE INC: "Now Is The Right Time" for Sale, News Corp. Says -------------------------------------------------------------- Anthony Ha, writing for VentureBeat, reports that News Corp. chief operating officer Chase Carney said on February 2 that "now is the right time" to consider selling Myspace or finding some other way to restructure its relationship with the parent company. "With a new structure in place, now is the right time to consider strategic options for this business," Mr. Carney said during a conference call with analysts, according to VentureBeat. "The new Myspace has been very well-received by the market and we have some very encouraging metrics. But the plan to allow Myspace to reach it's full potential may be best achieved under a new owner." As reported in the January 12 edition of the Troubled Company Reporter, MySpace has unveiled plans cutting nearly half of its staff worldwide, or about 500 employees, after an extensive revamp in October 2010 overhauled its look and allowed it to be run with fewer workers. Myspace reduced its staff by nearly 30% in the summer 2010, or about 420 jobs. Myspace is a social networking Web site headquartered in Beverly Hills, California. NIELSEN COMPANY: Fitch Upgrades Issuer Default Ratings to 'B+' -------------------------------------------------------------- Fitch Ratings has upgraded its ratings for the Nielsen Company, B.V., and Nielsen Finance LLC and Nielsen Finance Co. including the companies' Issuer Default Ratings which were upgraded to 'B+' from 'B'. The Rating Outlook remains Positive. Rating and Outlook Rationale: -- The upgrade reflects the successful IPO and mandatory convertible note issuance, with the planned use of proceed to reduce debt by $1.8 billion (face value of debt). Pro forma for the debt reduction, Fitch calculates gross unadjusted leverage at 5.1 times (significantly down from 11.3x in 2006). -- Since the company was acquired in 2006, new ownership has meaningfully restructured the organization around key business lines and aggressively streamlined costs. Given the contractual and diversified nature of its revenue stream and the benign competitive environment for key businesses, Nielsen was much more resilient during the downturn than other media companies, exhibiting revenue and EBITDA growth, as well as positive free cash flow through the trough of the downturn. Going forward, Fitch expects Nielsen will continue to generate meaningful organic revenue growth and that growth should be able to outpace the U.S. economy under most economic conditions/scenarios. -- Nielsen enjoys limited competition in its core audience measurement business, and over time competitive threats could emerge. There are meaningful barriers to entry. Fitch believes there are significant investments that would be required by any potential competitors and meaningful complexity associated with attempting to replicate Nielsen's offerings. While increased competition could result in revenue pressure (lost share), incremental costs (talent/sales/services), and some free cash flow pressure (investments in offerings), this risk is accommodated in the rating. -- The ratings also reflect the refinancing risk associated with $1.8 billion in secured term loans due in 2013. This risk is mitigated to an extent by Nielsen's access to debt markets (demonstrated several times by new issuances in a challenging debt market) and Fitch's expectation that senior secured leverage will be around 3.25x. Key Rating Drivers: -- Continued improvement in operating trends with gross leverage below 5x and interest coverage above 3x over the next 18-24 months could result in continued positive ratings momentum. -- Positive rating action may also be driven by Fitch's comfort with post-IPO financial policy which was commensurate with a higher rating (which could include maintaining gross unadjusted leverage around 5x). -- Near-term, the most likely drivers of rating pressure include a material debt-funded acquisition or an unexpected dividend policy that materially reduced free cash flow. Nielsen pre released 2010 revenues and operating income figures. Revenues for 2010 are expected to be up 5.8% to 6.2% on a constant currency basis. Fitch estimates EBITDA of approximately $1.3 billion, up 5% from 2009, with EBITDA margins of 26%. Fitch models EBITDA growth in the mid to high single digits in 2011, off of mid single digit growth from revenues. The higher pace in EBITDA growth reflects efficiencies from productivity initiatives, benefit from cost restructurings and the operating leverage of the business. Fitch believes Nielsen's liquidity is sufficient. At Sept. 30, 2010, liquidity was composed of $420 million of cash on hand and $668 million available under the senior secured revolver due in 2012. In the 12 months ended Sept. 30, 2010, Fitch calculates the company generated $170 million of FCF. Going forward, Fitch anticipates capex to remain below $300 million annually. As a result, Fitch expects the company to continue to generate material positive FCF and anticipates that it will be dedicated toward debt repayment, smaller acquisitions, and eventually shareholder returns. Pro forma for IPO, convertible note and the recent Nielsen Finance unsecured note issues, total debt at Sept. 30, 2010 was approximately $6.8 billion, consisting primarily of $5 billion in secured term loans ($1.8 billion due 2013, $2.7 billion due 2016, $500 million due 2017); approximately $150 million in Nielsen debt coming due in 2011 to 2012(legacy debt prior to the LBO); approximately $200 million of senior notes due 2014; approximately $300 million of senior notes due 2016; and $1.1 billion of senior notes due 2018. The company has been active in managing its near- term maturities, and they are manageable over the next several years. Under Fitch's hybrid security criteria, the 6.25% Mandatory Convertible Subordinated notes due 2013 are afforded 100% equity credit. These notes will automatically convert on Feb. 1, 2013 (less than three years) into common equity and have a set conversion rate (a max of 2.1739 and a min of 1.8116). In September 2010, Fitch stated that it would conduct a review of its hybrid criteria. Even if the results of this criteria review resulted in no equity credit for the convertible notes, there would be no impact on Nielsen's ratings or the issue ratings on the convertible notes. Nielsen's Recovery Ratings reflect Fitch's expectation that the enterprise value of the company, and hence, recovery rates for its creditors, will be maximized in a restructuring scenario (going- concern) rather than a liquidation. Fitch's recovery analysis assumes that the company is restructured at the point at which its EBITDA breaches its covenants (approximately a 35% decline from LTM levels). In this distressed scenario, Fitch estimates the group could be sold for a 6x multiple of LTM EBITDA. Fitch notes the company was acquired at slightly less than 12x in the LBO and Fitch estimates the recent IPO valued Nielsen at approximately 12x. On this basis, Fitch estimates Nielsen Finance's senior secured creditors could recover in the 71%-90% range represented by its 'RR2' Recovery Rating. Given that the senior secured is not fully recovered, Fitch estimates no recovery ('RR6') for other classes of debt. Fitch notches the Nielsen Finance senior unsecured notes down two notches to 'B-' to reflect its priority position relative to other debt in the capital structure. Fitch notches the debt issued by Nielsen by three notches to 'CCC'. Fitch has upgraded these ratings: Nielsen -- IDR to 'B+' from 'B'; -- Senior Unsecured Notes to 'CCC'/RR6 from 'CC'/RR6. Nielsen Finance -- IDR to 'B+' from 'B'; -- Senior Secured Bank Facility to 'BB'/RR2 from 'BB-'/RR2; -- Senior Unsecured Notes to 'B-'/RR6 from 'CCC'/RR6; -- Senior Subordinated Notes 'CCC'/RR6 from 'CC'/RR6. Fitch has assigned these ratings: Nielsen -- Mandatory Convertible Subordinated Notes 'CCC'/RR6. Fitch has withdrawn these ratings (as Fitch does not expect Nielsen or Nielsen Finance to be a commercial paper issuer in the near term): Nielsen -- Short-term IDR 'B'. Nielsen Finance -- Short-term IDR 'B'. The Outlook is Positive. NORTH AVENUE: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: North Avenue Partners, LLC 4475 River Green Parkway Duluth, GA 30096 Bankruptcy Case No.: 11-53377 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Brian L. Schleicher, Esq. NORTH ATLANTA LAW GROUP, P.C. Suite 100, 11680 Great Oaks Way Alpharetta, GA 30022 Tel: (770) 667-1290 Fax: (770) 667-1690 E-mail: bschleicher@northatlantalaw.net Scheduled Assets: $3,923,803 Scheduled Debts: $4,792,948 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Lee Najar, manager. OPTI CANADA: Declining Liquidity Cues' Moody's 'Caa3' Rating ------------------------------------------------------------ Moody's Investors Service lowered OPTI Canada Inc.'s Corporate Family Rating to Caa3 from Caa2, C$190 million secured first-lien revolving facility to B2 from B1, US$525 million secured first- lien 1B notes to B3 from B2, US$300 million secured first-lien 1C notes to Caa1 from B3 and US$1.75 billion senior secured second- lien notes to Ca from Caa3. The rating outlook remains negative. Ratings Rationale The lowering of the ratings reflects OPTI's declining liquidity and Moody's views that the company will be unable to meet all of its cash requirements in 2011. Moody's estimate that at the end of December 2010, OPTI had $175 million of cash. In 2011, cash interest will be $180 million and OPTI's share of Long Lake capex will be $150 million, with another $50 million for their share of the Phase 2 SAGD site (Kinosis) possible, and Moody's expects only breakeven to slightly positive operating cash flow from the Long Lake project. At December, 2010, the $190 million revolver was fully available, but as it matures in December, 2011, Moody's do not consider it an available source of liquidity. As well, the $525 million 1B notes mature in December, 2012. The negative outlook reflects Moody's views that OPTI's capital structure is unsustainable and will likely need to be restructured. A downgrade will occur if OPTI files for creditor protection or restructures its debt in a manner economically detrimental to the full claims of its lenders. The ratings of the various rated debt instruments reflect their priority of claim on OPTI's assets under Moody's Loss Given Default Methodology. The revolver lenders are the first ranking lenders, followed by the 1B and then the 1C notes. The second- lien note holders rank last. OPTI Canada Inc., headquartered in Calgary, Alberta, holds a 35% interest in Long Lake, an in-situ oil sands operation near Fort McMurray, Alberta. OTTER TAIL: Green Plains-Led Auction on Feb. 16 ----------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Otter Tail AG Enterprises LLC sought and obtained approval to conduct an auction for its 55-million gallon-a-year ethanol plant in Fergus Falls, Minnesota, on Feb. 16. Initial bids are due Feb. 11. A hearing for approval of the sale is scheduled for Feb. 17. As reported in the Jan. 14, 2011, Green Plains Renewable Energy, Inc., through newly formed entity OTAV LLC, has signed an asset purchase agreement to acquire the dry-mill ethanol plant, absent higher and better bids at the auction. The assets to be sold consist of the real property, buildings, process equipment, including the Solid Waste Facility, and other fixed assets of the ethanol manufacturing plant. The purchased assets will also include input, product, and parts inventories. The parties agreed for a purchase price of a) a base price of $55,000,000 comprised of assumed indebtedness and a cash payment; b) payment for prepaid expenses at closing; and c) payment for inventories. The estimated total purchase price is $62,544,486. A partial source of the buyer's funds will be from financing from Agstar Financial Services, PCA, the Debtor's largest secured creditor, and a portion of the purchase price will include the assumption of the MMCDC New Markets Fund II, LLC indebtedness. The APA also includes an expense reimbursement up to $100,000. OTAV may terminate the APA if it is the successful bidder at the auction and the closing does not occur on or before April 15. Bill Rochelle, the bankruptcy columnist for Bloomberg News, recounts that Otter Tail, having negotiated a consensual reorganization with most of its larger creditors, intended to reorganize with a Chapter 11 plan. When Otter Tail was unable to raise the $12.5 million in required equity, it decided to sell. About Green Plains Green Plains Renewable Energy, Inc. (Nasdaq:GPRE) is North America's fourth largest ethanol producer, operating a total of eight ethanol plants in Indiana, Iowa, Michigan, Nebraska and Tennessee with annual expected operating capacity totaling approximately 657 million gallons. Green Plains owns 51% of Blendstar, LLC, a biofuel terminal operator which operates nine blending or terminaling facilities in seven states in the south central United States. About Otter Tail AG Based in Fergus Falls, Minnesota, Otter Tail AG Enterprises, LLC -- http://www.ottertailethanol.com/-- owns and operates a nameplate capacity 55 million gallon annual production plant of undenatured ethanol in Fergus Falls, Minnesota. The Company processes approximately 20 million bushels of corn into approximately 55 million gallons of ethanol each year. In addition, the Company sells distillers grains, a principal co-product of the ethanol production process. The Company filed for Chapter 11 on Oct. 30, 2009 (Bankr. D. Minn. Case No. 09-61250). 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. PENINSULA GAMING: Moody's Assigns 'Ba3' Rating to $80 Mil. Notes ---------------------------------------------------------------- Moody's Investors Service assigned a Ba3 (LGD2 ,29%) rating to Peninsula Gaming, LLC's proposed add-on issuance of $80 million senior secured notes due 2015. All PGL's existing ratings, including its B2 Corporate Family Rating and Probability of Default Rating, and stable rating outlook remain unchanged. Proceeds from proposed offering plus the already issued add-on senior unsecured notes of $50 million, planned slot vendor and equipment financing of $42 million and cash flow from existing and future operations will be used to fund the first phase of a $295 million casino project named Kansas Star in Mulvane, Kansas, approximately 14 miles south of Wichita, KS. Construction is expected to begin in the first quarter of 2011 with an initial opening in January 2012 to operate 1,310 slot machines and 32 table games in a temporary facility. The assigned rating of the add-on senior secured notes is subject to completion of a series of transactions and final review of the terms and documentations. The rating action is: Rating assigned: * $80 million senior secured notes add-on due 2015 -- Ba3 (LGD2, 29%) Existing Ratings: * Corporate Family Rating -- B2 * Probability of Default Rating -- B2 * $240 million senior secured notes due 2015 -- Ba3(LGD2, 29%) * $305 million senior unsecured notes due 2017 -- Caa1(LGD5, 79%) * $50 million senior unsecured notes add-on due 2017 -- Caa1(LGD5, 79%) Ratings Rationale The B2 corporate family rating primarily reflects PGL's high financial leverage due to weaker than Moody's expected operating performance from existing casinos, particularly the two properties located in Louisiana. The rating also incorporates the increased business risks associated with a ground-up casino development. The B2 rating has taken into account the expected significant increase in debt/EBITDA to well above 7.0x throughout 2011 during the construction period and the gradual decrease of the leverage ratio after the planned opening of the casino in a temporary facility starting in January 2012. The B2 CFR gains support from the company's expected good liquidity and relative stability of PGL's regional-focused markets throughout the recession. The stable ratings outlook reflects Moody's expectation that property level EBITDA generation from the existing four casinos in Iowa and Louisiana will remain relatively steady and the company will maintain a sound liquidity position. The stable outlook also assumes that PGL is able to obtain project financings on a timely basis, the Kansas casino will open on time and on budget, and that the primary market area will provide enough guest traffic and spending for the casino to generate sufficient cash flow to reduce the company-wide debt/EBITDA to below 5.5x one year after its opening. Further, while at this junction it is impossible to predict the outcome of the recent budget proposal by the Governor of Iowa to raise state casino tax rate, the increase of the rate as proposed is significant and could result in meaningful impact on PGL's profitablity and thus downward pressure on ratings or outlook. PGL is a holding company whose primary assets are equity interests in its wholly owned subsidiaries, which own and operate the Diamond Jo casino in Dubuque, Iowa, the Evangeline Downs Racetrack and Casino in St. Landry Parish, Louisiana, the Amelia Belle Casino located in Amelia, Louisiana, and the Diamond Jo Worth casino in Worth County, Iowa. Consolidated net revenues for the fiscal year ended December 31, 2009, were approximately $308 million. POINT BLANK: Seeks Approval on Backstop Purchase Agreement ---------------------------------------------------------- BankruptcyData.com reports that Point Blank Solutions filed with the U.S. Bankruptcy Court a motion for authorization to enter into a subscription and backstop purchase agreement with Prescott Group Capital Management LLC, Privet Opportunity Fund I LLC, and Lonestar Capital Management, LLC, as manager to PB Funding, LLC. Under the agreement, Privet and Prescott will subscribe directly for, and purchase, an additional $6,343,500 of New Common Stock. If the Debtors require additional financing and an Exit Facility is unavailable, or cannot be obtained in an amount or on terms and conditions acceptable to the Backstop Purchasers, they may increase the Rights Offering up to a maximum of $14,427,500, together with a proportionate increase in the direct issuance to Privet and Prescott of up to a maximum of $10,572,500, for a total of up to $25,000,000 of New Common Stock. According to the Debtors, "The Backstop Agreement is an integral component of the Plan. Without the proceeds assured by the Backstop Purchasers' commitments under the Backstop Agreement, it is unlikely that the Debtors would be able to raise an adequate amount of capital through the Rights Offering or have a viable strategy for exiting from chapter 11, an untenable result for the Debtors that, by and large, are still dependent upon infusions of capital to fund their operations." About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection on April 14, 2010 (Bankr. D. Del. Case No. 10-11255). Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. T. Scott Avila of CRG Partners Group LLC is the restructuring officer. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. The Equity Committee has tapped Morrison Cohen LLP, and The Bayard, P.A., as counsel. Robert M. Hirsh, Esq., and Heike M. Vogel, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at Messana Rosner & Stern LLP, serve as co-counsel. POMPANO CREEK: Section 341(a) Meeting Scheduled for March 10 ------------------------------------------------------------ The U.S. Trustee for Region 21 will convene a meeting of Pompano Creek Associates, LLC's creditors on March 10, 2011, at 10:30 a.m. The meeting will be held at U.S. Courthouse, 299 E Broward Boulevard #411, Ft Lauderdale, FL 33301. 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. Vienna, Virginia-based Pompano Creek Associates, LLC, filed for Chapter 11 bankruptcy protection on January 26, 2011 (Bankr. S.D. Fla. Case No. 11-11989). Loretta Bangor, Esq., at the Law Office of Loretta Bangor, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. RADIENT PHARMACEUTICALS: Agrees to Sell $8.4MM Convertible Notes ---------------------------------------------------------------- On January 31, 2011, Radient Pharmaceuticals Corporation announced the signing of a definitive agreement for the private sale of Convertible Notes and Warrants in the original principal amount of $8.4 million and the right to purchase RPC common stock. RPC intends to use the net proceeds from the Note for general corporate purposes, including activities related to the long-term commercialization of RPC's Onko-SureTM in vitro diagnostic (IVD) cancer test. The $8.4 million of Note issued pursuant to this transaction has an 11 month term and will be initially convertible in whole or in part into shares of RPC common stock at the conversion price equal to $0.60 per share, subject to adjustment. Each buyer will pay $888.88 for each $1,000.00 of principal amount of Notes and related Warrants to be purchased at closing. The conversion price of the Notes are subject to adjustment upon the occurrence of certain events, including recapitalization, stock splits, and similar corporate actions. Each buyer will receive a Series A Warrant and a Series B Warrant, each of which has a five year term. The Series A Warrants are initially exercisable at $0.67 per share and the Series B Warrants are initially exercisable at $0.8175 per share. The exercise price of the Warrant and the number of warrant shares is subject to adjustment upon the occurrence of certain events, including capital adjustments and reorganizations. The Company is required to file a registration statement to register for resale 130% of the number of shares of common stock issuable upon conversion of the Note and exercise of the Warrant on or before February 9, 2011. Reedland Capital Partners, an Institutional Division of Financial West Group, member FINRA/SIPC, served as the company's placement agent and financial advisor in connection with the financing. "This financing, when combined with the previously announced ongoing and anticipated debt conversions and exchanges, will put RPC in a dramatically improved financial position that allows for the rapid commercialization of our Onko-Sure(R) IVD cancer test. It also reflects the strong support from RPC investors that believe in the potential of our Onko-Sure IVD cancer test and have confidence in the Company's management team and business strategy," said Douglas MacLellan, Chairman and CEO of RPC. 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. RADIENT PHARMACEUTICALS: Seeks to Withdraw Form S-1 Registration ---------------------------------------------------------------- In a letter dated January 31, 2011, Louis Taubman, Esq., at Leser Hunter Taubman & Taubman, in New York, counsel to Radient Pharmaceuticals Corporation, requested to withdraw the company's Registration Statement on Form S-1 which the company initially filed with the Securities and Exchange Commission on May 3, 2010, under the Securities Act of 1933, as amended. The initial Registration Statement was not declared effective. The May 3 prospectus relates to the resale of up to 67,058,767 shares of the Company's common stock, $0.001 par value. 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. RAFAELLA APPAREL: S&P Raises Corporate Credit Rating to 'B+' ------------------------------------------------------------ On Feb. 2, 2011, Standard & Poor's Ratings Services said that it raised its corporate credit rating on New York-based Rafaella Apparel Group Inc. to 'B+' from 'CC'. The rating outlook is stable. "S&P removed all ratings from CreditWatch, where they were placed with positive implications on Jan. 10, 2011, following the announcement that it had entered into a definitive agreement in which Perry Ellis International, Inc would acquire substantially all of the assets of Rafaella," said Standard & Poor's Credit analyst Linda Phelps. S&P subsequently removed all of its ratings on Rafaella Apparel Group Inc. The rating action follows the completion of the transaction in which Perry Ellis International Inc. acquired substantially all of the assets of Rafaella for $80 million and warrants to purchase 106,564 shares of common stock. Rafaella has paid down its existing debt with the cash proceeds from the transaction and Perry Ellis will not assume any debt with this merger. S&P's rating outlook on Rafaella Apparel Group Inc. is stable, reflecting the company's enhanced business and financial profiles due to its acquisition by Perry Ellis. Following this rating upgrade, S&P will withdraw its corporate credit rating on Rafaella. RDK MUNICIPAL: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: RDK Municipal Truck Center, Inc. 3214 Adamo Drive Tampa, FL 33605 Bankruptcy Case No.: 11-01878 Chapter 11 Petition Date: February 1, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Alberto F. Gomez, Jr., Esq. MORSE & GOMEZ, PA 119 S. Dakota Avenue Tampa, FL 33606 Tel: (813) 301-1000 E-mail: algomez@morsegomez.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Richard D. Kemner, president. Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- RDK Truck Sales & Service Inc. 11-01877 02/01/11 RDK TRUCK: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: RDK Truck Sales & Service, Inc. 3214 Adamo Drive Tampa, FL 33605 Bankruptcy Case No.: 11-01877 Chapter 11 Petition Date: February 1, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Alberto F Gomez, Jr., Esq. MORSE & GOMEZ, PA 119 S. Dakota Avenue Tampa, FL 33606 Tel: (813) 301-1000 E-mail: algomez@morsegomez.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Richard D. Kemner, president. REVEL AC: Moody's Assigns 'Caa1' Corporate Family Rating -------------------------------------------------------- Moody's Investors Service assigned Caa1 Corporate Family and Probability of Default ratings to Revel AC, LLC. A B3 was assigned to the company's $850 million 6-year first lien term loan and $50 million 6-year revolving line of credit. The rating outlook is stable. Revel AC, LLC, is a privately held company that is currently developing Revel AC, a $2.4 billion entertainment resort and casino located on the Boardwalk in the south inlet of Atlantic City, NJ. Proceeds from the $850 term loan along with proceeds from a new $304.4 million 12% 7-year second lien mezzanine loan (not rated) will be used to fund the remaining $1.1 billion costs to complete. These include $600 million of remaining hard costs, $337 million of other soft costs and $178 million of capitalized interest and fees. New Ratings Assigned: * Corporate Family Rating at Caa1 * Probability of Default Rating at Caa1 * $50 million 6-year first lien revolving line of credit at B3 (LGD 3, 37%) * $850 million 6-year first lien term loan at B3 (LGD 3, 37%) Ratings Rationale The Caa1 Corporate Family Rating and Probability of Default Rating (PDR) reflect the considerable development and ramp-up risk associated with Revel AC. Although a large portion of the casino is finished -- the outer shell is complete -- development risk is still meaningful. There is over $1 billion of costs remaining on the project which is not scheduled to open for another 15 months. As a result, there are significant opportunities for delays and unforeseen problems that could make it difficult to open on time and on budget. The ratings also reflect Revel's challenge of achieving targeted business volumes in a gaming market that Moody's expects will see a further and substantial decline in gaming revenue. The Atlantic City gaming market is faced with increasing competition from new and more convenient gaming venues in the northeastern U.S. Gaming revenues in Atlantic City have declined steadily and significantly in the past few years. Additionally, there is no assurance that economic condition at the time of opening will be strong enough to support the company's initial ramp-up expectations. Assuming targeted levels are met, the company's first full year of operations still result in high pro forma debt/EBITDA -- about 6 times. The ratings are supported by Revel's attractive concept and design that Moody's believes will provide it with a competitive advantage over other Atlantic City casinos. It is particularly attractive as it relates to the company's ability to attract mid-week group business, as, unlike most of Atlantic City's existing casinos, Revel is designed to accommodate large group meetings. The attractive mix of product offerings in terms of quality and quantity should also enable Revel to attract this highly profitable business. The stable outlook reflects Revel's good liquidity. The proposed financing will fully fund the remaining project costs, including an interest reserve on the first lien term loan that will prefund two years of interest payments, and will contain the appropriate contingency reserves for a project of this size and scope. Additionally, Revel's proposed mezzanine loan will pay interest in-kind for the first two and a half years, with the option to pay in PIK or in cash for six months thereafter. The B3 rating on the $50 million revolving line of credit and $850 million term loan is one-notch above Revel's Caa1 CFR. This difference reflects the significant credit support provided by the second lien mezzanine debt below it in the capital structure. The ratings could be downgraded prior to opening if there is any event that causes a delay in the project's opening or a total project cost that is greater than currently planned. Ratings could also be downgraded if Moody's believes that Revel will not be able obtain the advanced bookings necessary to ramp-up at a rate to achieve targeted business volumes. The ratings could also be lowered if Moody's believes that recurring EBITDA less capital expenditures to total interest expense will not approach 1.0 time by June 2013, or if the probability of default increases for any reason. A higher rating is not likely over the near-term given the development status of the project and prospective nature of the rating. A higher rating would require that the project open on time and on budget and that Moody's believes that recurring EBITDA minus capital expenditures to total interest expense will exceed 1.0 times. This is a first time rating on Revel AC, LLC. Revel AC, LLC, is a privately held company that is developing Revel AC, a $2.4 billion entertainment resort and casino located on the Boardwalk in the south inlet of Atlantic City, NJ. RMAA REAL: U.S. Trustee Wants Case Converted to Chapter 7 --------------------------------------------------------- W. Clarkson McDow, Jr., the United States Trustee for Region 4, has requested the U.S. Bankruptcy Court for the Eastern of District of Virginia to convert the involuntary Chapter 11 case against RMAA Real Estate Holdings, LLC, to a case under Chapter 7, or alternatively, to dismiss the case. In support of the motion, the U.S. Trustee said the Debtor's only assets appear to be causes of action relating to a single piece of real estate, a house, located in Leesburg, Virginia, and that the merits of these causes of action can best be evaluated and acted upon by a disinterested trustee in Chapter 7. In addition, the United States Trustee said there does not appear to be any unusual circumstances in this case that would result in a finding that either dismissal or conversion of this case is not in the best interest of the creditors of the estate. The hearing on the U.S. Trustee's motion has been scheduled for February 8, 2011, at 11:00 a.m. About RMAA Real Estate Ashburn, Virginia-based RMAA Real Estate Holdings, L.L.C., was placed into involuntary Chapter 11 bankruptcy (Bankr. E.D. Va. Case No. 10-16505) on August 3, 2010, by three creditors allegedly owed $295,000. The petitioning creditors Brevon Developers, Inc., Brett Anthony Amendola, and Roger Amendola assert breach of contract claims. They are represented by John Paul Forest, II, Esq., at Stahl Zelloe, P.C., in Fairfax, Virginia. On September 13, 2010, Socrates Torres filed an involuntary petition against RMAA (Bankr. E.D. Va. Case No. 10-17701). The involuntary summons was never served and the case was dismissed for failure to prosecute. RUGGED BEAR: Amends List of 20 Largest Unsecured Creditors ---------------------------------------------------------- The Rugged Bear Company has filed with U.S. Bankruptcy Court for the District of Massachusetts its amended list of 20 largest unsecured creditors, disclosing: Entity Nature of Claim Claim Amount ------ --------------- ------------ Detwiler Fenton Group, Inc. 100 High Street Suite 2800 Boston, MA 02110 noteholder $755,000 The Boston Globe P.O. Box 415071 Boston, MA 02241-5071 non-trade vendor $278,308 Kamik/Genfoot c/o Mary Gustafson Genfoot America, Inc. vendor $242,201 EEAN Fashions vendor $169,202 Donald C. Jones promissory note $166,667 Urstadt Biddle Properties, Inc. rent $159,229 Stop & Shop Supermarket Co. rent $121,753 Chestnut Hill Shopping rent $115,689 Cotton Kids/Beadecked Inc. vendor $109,944 Nagog Mall, LLC rent $80,947 Turtle Fur Company & Nordic vendor $78,464 Kliger Weiss Infosystems non-trade vendor $76,706 Wee Ones, Inc. vendor $73,555 Tophand Innovative Accessories LTD. vendor $73,306 Washington Shoe Company vendor $71,861 Edens & Avant Wellesley (E&A), LLC rent $70,288 Merrell Wolverine World Wide, Inc. vendor $68,212 Artimoda S A vendor $66,819 Century Partners LTD rent $65,869 DZ Trading LTS vendor $65,743 Cotton Resources Globaltex Inc. has been taken off the list and replaced with Donald C. Jones. About The Rugged Bear Headquartered in Norwood, Massachusetts, The Rugged Bear Company is a chain of retail children's clothing stores New England, New York and New Jersey. It filed for Chapter 11 bankruptcy protection on January 25, 2011 (Bankr. D. Mass. Case No. 11- 10577). Charles A. Dale, III, Esq., at K&L GATES LLP, serves as the Debtor's bankruptcy counsel. Consensus Advisers, LLC, is the Debtor's financial advisor. The Debtor estimated its assets and debts at $10 million to $50 million. S & Y ENTERPRISES: Court Sets March 4 Bar Date for Proofs of Claim ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of New York has fixed March 4, 2011, at 5:00 p.m. as the bar date for the filing of proofs of claim against the estate of S & Y Enterprises, LLC. The bar date for governmental units is May 10, 2011. Proofs of claim must be received by the Clerk of the Bankruptcy Court on or before the applicable bar dates at the following address: United States Bankruptcy Court Eastern District of New York 271 Cadman Plaza East Brooklyn, NY 11201 About S & Y Enterprises, LLC Brooklyn, New York-based S & Y Enterprises, LLC, own and maintain real estate. The Company filed for Chapter 11 protection on November 11, 2010 (Bankr. E.D. N.Y. Case No. 10-50623). David Carlebach, Esq., who has an office in New York, assists the Debtor in its restructuring effort. The Company disclosed $20,014,678 in assets and $8,700,899 in liabilities as of the Chapter 11 filing. SATISFIED BRAKE: Intellectual Property Dispute Cues Bankruptcy -------------------------------------------------------------- Danielle Vandenbrink, writing for Standard-Freeholder in Montreal, Canada, reports that Satisfied Brake has filed for bankruptcy on January 12, leaving employees from its Cornwall plant permanently laid off. According to the report, Montreal firm Litwin Boyadjian has been appointed as trustee. According to the report, competitor company BPI sued Satisfied Brake in 2009 over "ownership of specific formulas," prompting a court injunction in December 2010 preventing the company from continuing operations on most of its products. The Cornwall plant has been shut down since Jan. 3, when employees were given notice of temporary layoff pending the outcome of a lawsuit in the U.S. The report relates the notice informed employees they would be paid outstanding wages, as required by the Wage Earner Protection Act, which comes into effect when employees lose their jobs as a result of bankruptcy. The letter directs workers to file a claim for wages through Service Canada by Feb. 26. The report says bankruptcy documents list the Company's total net book value of assets as worth an estimated $16.5 million. The report notes the employees are among 170 entities listed as creditors in the bankruptcy documents, including many Cornwall and area companies. Satisfied Brake is a brake manufacturer headquartered in Dorval, Quebec, in Canada. SCANWOOD CANADA: Declared Insolvent by Halifax Court ---------------------------------------------------- CBC/Radio-Canada reports that Scanwood Canada Ltd., a furniture maker in Dartmouth, Nova Scotia, was declared insolvent on Wednesday by a Halifax court. The Company was placed in creditor protection and Green Hunt Wedlake was appointed to monitor Scanwood. The company is continuing as an on-going business. According to the report, one of Scanwood's creditors, RBC Royal Bank, unexpectedly called a $2.1-million line of credit in January, which triggered the events leading to Wednesday's court order. The order protects Scanwood from creditors until March 3. Secured creditors agreed to the order on Wednesday, which allows Scanwood time to come up with a proposal to go forward. Justice Heather Robertson granted the company's application for creditor protection. "We now have a stay in place. We can focus on developing the plan to bring this company back to where it used to be and where it can be," said Bo Thorn, the chairman of Scanwood, according to CBC. "All our stakeholders, we've been working with them very closely. We continue to do that. Ikea will continue to buy everything we produce." Scanwood Canada is a supplier of cabinets to Swedish retailer Ikea. It has 248 employees at its Burnside Industrial Park plant in Dartmouth. The four major creditors are RBC Royal Bank, the Province of Nova Scotia, Ikea and the Business Development Bank of Canada. SHERWOOD FARMS: Centennial Moves Court to Appoint Ch. 11 Trustee ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida has scheduled a hearing for February 16, 2011, to consider the motion of Centennial Bank for the appointment of a Chapter 11 trustee in Sherwood Farms, Inc.'s bankruptcy case. In its motion dated November 23, 2010, Centennial Bank cited the failure of the Debtor to manage the bankruptcy case and its breach of fiduciary duties to all creditors. Centennial, a secured creditor of the Debtor in the principal amount of $5,291,879, holds a first mortgage lien on the Debtor's real property in Lake County, Florida. In support of its motion, Centennial says that based on historical figures, the farm may likely be profitable under different management. Further, Centennial believes there are third parties who are interested in purchasing the Debtor's assets or operations. Also, unlike with conversion, a Chapter 11 trustee has the ability to operate the business so as to preserve going concern value pending the marketing and sale of the business. By appointing a Chapter 11 Trustee, and removing current mismanagement, Centennial says that it is possible that the Debtor's operations could generate income similar to the income generated in 2009. About Sherwood Farms Groveland, Florida-based Sherwood Farms, Inc., owns and operates an orchid farm from its real property in Lake County, Florida. The Company filed for Chapter 11 bankruptcy protection on January 15, 2010 (Bankr. M.D. Fla. Case No. 10-00578). Mariane L. Dorris, Esq., at Latham Shuker Eden & Beaudine LLP, in Orlando, Fla., assists the Debtor in its restructuring effort. The Company estimated its assets and debts at $10 million to $50 million. An affiliate, Sherwood Investments Overseas Limited Incorporated, filed a separate Chapter 11 petition on January 15, 2010 (Bankr. M.D. Fla. Case No. 10-00584). Mariane L. Dorris, Esq., at Latham Shuker Eden & Beaudine LLP, in Orlando, Fla., represents the Debtor as counsel. At the time of the filing, the Debtor estimated its assets and debts at $10 million to $50 million. SHUBH HOTELS PITTSBURGH: Judge May Appoint Chapter 11 Trustee ------------------------------------------------------------- Kim Leonard at the Pittsburgh Tribune-Review reports that a federal bankruptcy judge said it plans to appoint a trustee to oversee the Chapter 11 case on the former Pittsburgh Hilton hotel Shubh Hotels Pittsburgh LLC nka Wyndham Grand Pittsburgh Downtown. The judge said he is tired of the "animosity" between interests competing for control. The Tribune-Review says the trustee has yet to be named. The trustee will have independent control of business decisions at the hotel. According to the Tribune-Review, the bankruptcy court has been reviewing dueling reorganization plans proposed by hotel owner Dr. Kiran Patel and mortgage holder BlackRock Financial Management Inc. Mr. Patel's attorney David Rudov said franchisee Wyndham Hotels & Resorts has committed another $5 million in addition to $1 million in loans to pay off about 350 creditors of the former Hilton and to pay for completion of an expansion. Mr. Rudov said about 70% of the creditors are owed less than $10,000. The judge gave a mediator until Feb. 15, 2011, to try settling the dispute between Mr. Patel and BlackRock. But a BlackRock attorney and a court-approved examiner told to sort out the hotel's finances said they weren't optimistic. About Shubh Hotels Pittsburgh Boca Raton, Florida-based Shubh Hotels Pittsburgh, LLC, owns and operates the largest hotel in the City of Pittsburgh. For roughly 50 years, the Hotel operated as a Hilton franchise. Hilton terminated the Hilton Franchise Agreement by letter dated September 1, 2010. The Debtor filed for Chapter 11 bankruptcy protection on September 7, 2010 (Bankr. W.D. Pa. Case No. 10-26337). Scott M. Hare, Esq., in Pittsburgh, Pennsylvania, and attorneys at Rudov & Stein, P.C., serve as co-counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $50 million to $100 million. As reported in the Troubled Company Reporter on January 5, 2011, mortgage lender Carbon Capital II Real Estate CDO 2005-1, Ltd., is challenging Shubh Hotels Pittsburgh, LLC's bankruptcy-exit plan and is proposing its own sale-driven road map for the Company's Chapter 11 case. The plan from Carbon Capital and loan administrator BlackRock Financial Management Inc. calls for a sale of Shubh's assets, with the lender itself kicking off bidding with a credit bid of up to $52.6 million. SINCLAIR BROADCAST: Strikes Multi-Year Deal With Time Warner ------------------------------------------------------------ Sinclair Broadcast Group, Inc., has entered into a multi-year agreement with Time Warner Cable for the carriage of 28 of the television stations Sinclair owns or operates in 17 markets. The television stations and markets are: WLFL & WRDC (Raleigh, NC), WCGV & WVTV (Milwaukee, WI), KABB & KMYS (San Antonio, TX), WSYX & WTTE (Columbus, OH), WSTR (Cincinnati, OH), WUTV & WNYO (Buffalo, NY), WSYT & WNYS (Syracuse, NY), WXLV & WMYV (Greensboro, NC), WRGT & WKEF (Dayton, OH), WGME (Portland, ME), WUHF (Rochester, NY), WDKY (Lexington, KY), WCHS & WVAH (Charleston, WV), WTAT & WMMP (Charleston, SC), WTVZ (Norfolk, VA), WPGH & WPMY (Pittsburgh, PA), and KBSI (Cape Girardeau, MO). In addition, TWC will produce a 6:30am, 6:00pm and 11:00pm half- hour local news program, Monday through Friday, on Sinclair's ABC affiliate, WXLV-TV, in Greensboro/Winston-Salem, NC beginning January 2012. About Sinclair Broadcast Based in Baltimore, Maryland, Sinclair Broadcast Group, Inc. (Nasdaq: SBGI) -- http://www.sbgi.net/-- one of the largest and most diversified television broadcasting companies, currently owns and operates, programs or provides sales services to 58 television stations in 35 markets. The Company's television group reaches roughly 22% of U.S. television households and includes FOX, ABC, CBS, NBC, MNT, and CW affiliates. * * * Sinclair Broadcast has a 'B1' corporate family rating from Moody's. It has a 'B+' corporate credit rating from Standard & Poor's Ratings Services. "The CFR continues to reflect still high financial risk, nonetheless, and the inherent cyclicality of the broadcast television business, among other factors," Moody's said in August 2010. "The 'B+' rating reflects S&P's expectation that Sinclair will be able to reduce its leverage further by the end of 2010 through revenue and EBITDA growth and lower debt balances," explained Standard & Poor's credit analyst Deborah Kinzer in August. Moody's Investors Service raised its ratings for Sinclair Broadcast Group, Inc., and subsidiary Sinclair Television Group, Inc., including the Corporate Family Rating and Probability-of- Default Rating, each to Ba3 from B1, and the ratings for individual debt instruments, concluding its review for possible upgrade as initiated on August 5, 2010. Moody's also assigned a B2 (LGD 5, 87%) rating to the proposed $250 million issuance of Senior Unsecured Notes due 2018 by STG. The Speculative Grade Liquidity Rating remains unchanged at SGL-2. The rating outlook is now stable. SLK DEVELOPMENT: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: SLK Development, LLC aka Quality Cleaners 6645 Camp Bowie Blvd Fort Worth, TX 76116-4229 Bankruptcy Case No.: 11-40744 Chapter 11 Petition Date: February 1, 2011 Court: United States Bankruptcy Court Northern District of Texas (Ft. Worth) Judge: Russell F. Nelms Debtor's Counsel: Mark Joseph Petrocchi, Esq. GRIFFITH, JAY & MICHEL, LLP 2200 Forest Park Blvd. Ft. Worth, TX 76110 Tel: (817) 926-2500 Fax: (817) 926-2505 E-mail: mpetrocchi@lawgjm.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 Kim Jeong, member. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Jeong Soo Kim 10-37969 11/09/10 SMURFIT-STONE: Sued by Shareholder Over Buyout ---------------------------------------------- Phil Milford at Bloomberg News reports that Smurfit-Stone Container Corp., after exiting bankruptcy last year, was sued by a shareholder who contends investors will be shortchanged in a $3.5 billion buyout by Rock-Tenn Co. Smurfit-Stone stock owner John M. Marks claims company directors are duty-bound to get the best price and that the cash-stock buyout offer undervalues the Chicago-based company. "The proposed transaction is inadequate" in part because the company "had emerged from bankruptcy in 2010, and appeared poised to capitalize on its strengthened financial condition," Marks alleged in a complaint filed February 2 in Delaware Chancery Court. Bloomberg relates that Rock-Tenn, based in Norcross, Georgia, agreed last month to buy Smurfit-Stone for about $35 per share, half in cash and half in Rock-Tenn stock, according to court papers. Smurfit shares were trading above $37 as of Feb. 2. The Chancery case is Marks v. Smurfit-Stone, CA6164, Delaware Chancery Court (Wilmington). Bloomberg recounts that Smurfit-Stone exited bankruptcy after fighting with shareholders over its reorganization plan. Smurfit-Stone had been battling over whether the company would be worth enough once it left bankruptcy to give shareholders anything. The Company settled the dispute by giving common and preferred shareholders 4.5% of the reorganized company. 3 Hedge Funds Oppose Deal Michael J. de la Merced, writing for The New York Times' DealBook, reports that hedge funds Third Point Capital, Royal Capital Management and Monarch Alternative Capital wrote to the board of directors of Smurfit-Stone on Wednesday that they opposed the Company's $3.5 billion sale to competitor RockTenn, arguing the deal price was too low. The hedge funds said RockTenn's cash-and- stock bid -- valued at $38 a share as of Wednesday's market close -- ignores improvements in the Company's business. The hedge funds also criticized what they said was a lack of a sales process, pointing out comments from RockTenn that the deal was negotiated one-on-one as opposed to emerging from an auction. They also questioned whether Smurfit's outgoing chief executive, Patrick Moore, pushed for the deal because of a payout he was expected to receive if the merger went through. Under the terms of what's known as a "change-in-control" provision, Mr. Moore could receive more than $15 million through the deal. According to the report, the three firms together own about 9% of Smurfit's stock. They plan to urge other shareholders to vote against the deal. The investors argue that the Company could have attracted higher offers from RockTenn or another suitor -- or could have done better by remaining independent instead of taking the deal. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly US$7.450 billion in total assets and US$5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, served as the Debtors' bankruptcy counsel. PricewaterhouseCoopers LLC, served as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC served as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acted as the Debtors' notice and claims agent. The Company's Plan of Reorganization, which was confirmed by the U.S. Bankruptcy Court on June 21, 2010, and recognized by a Canadian court order, became effective July 1, 2010. The Plan provides that 2.25% of the new Smurfit-Stone common stock pool will be distributed pro rata to the Company's previous preferred stockholders and 2.25% of the New Smurfit-Stone common stock pool will be distributed pro rata to the Company's previous common stockholders. SOUTHWEST GEORGIA ETHANOL: Taps McKenna Long as Bankruptcy Counsel ------------------------------------------------------------------ Southwest Georgia Ethanol, LLC, asks for authorization from the U.S. Bankruptcy Court for the Middle District of Georgia to employ McKenna Long & Aldridge LLP as bankruptcy counsel, nunc pro tunc to the Petition Date. McKenna Long will, among other things: a. attend meetings and negotiate with representatives of creditors and other parties in interest and advise and consult on the conduct of the Chapter 11 case, including all of the legal and administrative requirements of operating in Chapter 11; b. review and prepare on behalf of the Debtor all motions, administrative and procedural applications, answers, orders, reports and papers necessary to the administration of the estate; c. negotiate and prepare a plan of reorganization, disclosure statement and all related agreements and documents and take any necessary action on behalf of the Debtor to obtain confirmation of the plan; and d. advise the Debtor in connection with any sale of assets. McKenna Long will be paid based on the rates of its professionals: Gary W. Marsh $525 J. Michael Levengood $510 Bryan Bates $375 Michael Levengood, Esq., a partner at McKenna Long, assures the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. About Southwest Georgia Ethanol Southwest Georgia Ethanol LLC, a unit of First United Ethanol Co., sought bankruptcy protection (Bankr. M.D. Ga. 11-10145) in Albany, Georgia, on February 1, 2011. The Debtor owns and operates an ethanol production facility located on 267 acres in Mitchell County, Georgia, producing 100 million gallons of ethanol annually. Ethanol production operations commenced in October 2008. Revenue was $168.9 million for fiscal year ended Sept. 30, 2010. The Debtor said profitability and liquidity have been materially reduced by unfavorable fluctuations in commodity prices for ethanol and corn. Morgan Keegan & Company, Inc., is the investment banker and financial advisor to the Debtor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. The Debtor's balance sheet showed $164.7 million in assets and $134.1 million in debt as of Dec. 31, 2010. Bloomberg News notes that since 2008, at least 11 ethanol-related companies have sought court protection, including VeraSun Energy Corp., once the second-largest U.S. ethanol maker; units of Pacific Ethanol Inc.; and White Energy Holding Co. SOUTHWEST GEORGIA ETHANOL: Wants to Hire Epiq as Claims Agent ------------------------------------------------------------- Southwest Georgia Ethanol, LLC, asks for authorization from the U.S. Bankruptcy Court for the Middle District of Georgia to employ Epiq Bankruptcy Solutions, LLC, as claims, noticing, and balloting agent, nunc pro tunc to the Petition Date. Epiq will, among other things: a. assist the Debtor with the compilation, administration, evaluation and production of documents and information necessary to support a restructuring effort; b. prepare and serve notices required in the Debtor's Chapter 11 bankruptcy case; c. create and maintain the official claims registers; and d. mail and tabulate ballots for purposes of plan voting. Epiq will be paid based on the rates of its professionals: Clerk $36-$54 Case Manager (Level 1) $112-$157 IT Programming Consultant $126-$171 Case Manager (Level 2) $166-$198 Senior Case Manager $202-$247 Senior Consultant $265 A copy of Epiq's services agreement with the Debtor is available for free at: http://bankrupt.com/misc/SOUTHWEST_GEORGIA_epiqservicespact.pdf Joseph N. Wharton, Vice President and Senior Consultant of Epiq, assures the Court that the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. About Southwest Georgia Ethanol Southwest Georgia Ethanol LLC, a unit of First United Ethanol Co., sought bankruptcy protection (Bankr. M.D. Ga. 11-10145) in Albany, Georgia, on February 1, 2011. The Debtor owns and operates an ethanol production facility located on 267 acres in Mitchell County, Georgia, producing 100 million gallons of ethanol annually. Ethanol production operations commenced in October 2008. Revenue was $168.9 million for fiscal year ended Sept. 30, 2010. The Debtor said profitability and liquidity have been materially reduced by unfavorable fluctuations in commodity prices for ethanol and corn. John Michael Levengood, Esq., at McKenna Long & Aldridge LLP, in Atlanta, Georgia, serves as counsel to the Debtor. Morgan Keegan & Company, Inc., is the investment banker and financial advisor. The Debtor's balance sheet showed $164.7 million in assets and $134.1 million in debt as of Dec. 31, 2010. Bloomberg News notes that since 2008, at least 11 ethanol-related companies have sought court protection, including VeraSun Energy Corp., once the second-largest U.S. ethanol maker; units of Pacific Ethanol Inc.; and White Energy Holding Co. SOUTHWEST GEORGIA ETHANOL: Proposes $10-Mil. of DIP Financing ------------------------------------------------------------- Southwest Georgia Ethanol, LLC, seeks authority from the U.S. Bankruptcy Court for the Middle District of Georgia to obtain postpetition secured financing from a syndicate of lenders led by WestLB AG, New York Branch, as administrative agent. The DIP lenders have committed to provide up to $10 million. A copy of the Debtor's DIP financing term sheet is available for free at http://ResearchArchives.com/t/s?72c6 J. Michael Levengood, Esq., at McKenna Long & Aldridge LLP, explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. All obligations of the Debtor under and with respect to the DIP Facility will be secured by (i) a fully perfected first priority, valid, binding, enforceable, non-avoidable and automatically perfected priming security interest in and lien upon the collateral. The DIP facility will mature (i) six months after the closing date; (ii) on the acceleration of all or any portion of the obligations under the DIP Facility; (iii) on the first business day on which the interim court order expires by its terms or is terminated; (iv) at the conversion of any of the Chapter 11 case to a case under Chapter 7 of the U.S. Bankruptcy Code; (v) on the dismissal of any of the Chapter 11 case; and (vi) on the effective date of any Debtor's plan of reorganization confirmed in the Chapter 11 case. The DIP Facility will incur interest at a rate equal to LIBOR + 9% per annum. LIBOR will be defined as the greater of (i) 4% per annum and (ii) the offered rate on the applicable page of the Telerate screen that displays an average British Bankers Association Interest Rate Settlement Rate for deposits in U.S. dollars for a period of one month and will contain appropriate protection to ensure that the rate isn't less than a DIP Lender's cost of funds. The default rate will be the then applicable interest rate plus 2.0% per annum. The Debtor is required to pay (i) a facility fee, which is 2.0% of the DIP revolving commitment payable to the DIP Lenders on the closing date; (ii) a structuring fee, which is 1.0% of the DIP revolving commitment payable to the DIP Agent on the closing date; and (iii) an unused commitment fee, which is a fee on the unused portion of the DIP revolving commitment of 2.0% per annum, payable monthly. The Debtor will be required to prepay certain amounts under the DIP Facility upon receipt of (i) project document termination payments; (ii) condemnation proceeds; (iii) insurance proceeds; and (iv) net cash proceeds of dispositions. Mandatory prepayments of principal outstanding under the DIP Facility will permanently reduce the DIP revolving commitments. Mandatory prepayments will be applied, first, to the payment of all costs, fees, expenses and indemnities then due and payable to the DIP secured parties; second, to the payment of any accrued and unpaid interest due and payable on the DIP revolving loans pro rata among the DIP Lenders with their respective outstanding principal amounts; third, to the repayment of principal of DIP revolving loans pro rata among the DIP Lenders with respect to their respective outstanding principal amounts until repaid in full; fourth, to the payment of accrued and unpaid interest then due and payable on the DIP revolving loans pro rata among the defaulting lenders based on their respective outstanding principal amounts on the date of the prepayment; fifth, to the payment of principal of DIP revolving loans pro rata among the defaulting lenders based on its respective outstanding principal amounts on the date of the prepayments; and, if a letter of credit subfacility is made available under the DIP facility, sixth, to be held as cash collateral up to an amount equal to the maximum aggregate amounts available to be drawn under letters of credit issued under the DIP revolving commitment to secure the repayment of any DIP revolving loans that may result from a draw on any letter of credit. Cash Collateral Use That the Debtor also asks for permission to use cash collateral to have access to additional liquidity. The Debtor owes $92 million under a loan provided by eight secured lenders that include AgCounty Farm Credit Services and Bank of Camilla and led by WestLB AG, New York Branch, as administrative agent and collateral agent. Pursuant to the credit agreement dated November 20, 2007, the Debtor's obligations are secured by a first-priority security interest in all of the Debtor's assets, including First United Ethanol Co.'s equity interest in the Debtor. Substantially all cash of the Debtor is required to be deposited into a "projects account" subject to security interests to secure obligations in connection with the Credit Agreement. The prepetition lenders have consented to the Debtor's use of the cash collateral. As adequate protection, the Debtor proposes that prepetition lenders be granted liens to secure their claim for any diminution of the value in the prepetition collateral or its interests in the prepetition collateral. In addition to the adequate protection liens, the Debtor proposes to grant the prepetition lenders a Section 507(b) claim. About Southwest Georgia Ethanol Southwest Georgia Ethanol LLC, a unit of First United Ethanol Co., sought bankruptcy protection (Bankr. M.D. Ga. 11-10145) in Albany, Georgia, on February 1, 2011. The Debtor owns and operates an ethanol production facility located on 267 acres in Mitchell County, Georgia, producing 100 million gallons of ethanol annually. Ethanol production operations commenced in October 2008. Revenue was $168.9 million for fiscal year ended Sept. 30, 2010. The Debtor said profitability and liquidity have been materially reduced by unfavorable fluctuations in commodity prices for ethanol and corn. John Michael Levengood, Esq., at McKenna Long & Aldridge LLP, in Atlanta, Georgia, serves as counsel to the Debtor. Morgan Keegan & Company, Inc., is the investment banker and financial advisor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. The Debtor's balance sheet showed $164.7 million in assets and $134.1 million in debt as of Dec. 31, 2010. Bloomberg News notes that since 2008, at least 11 ethanol-related companies have sought court protection, including VeraSun Energy Corp., once the second-largest U.S. ethanol maker; units of Pacific Ethanol Inc.; and White Energy Holding Co. SPOT MOBILE: Receives $1.8 Million from Sale of Securities ---------------------------------------------------------- On January 25, 2011, Spot Mobile International Ltd. completed the initial closing of a private placement with approximately 30 accredited investors, pursuant to which the company sold to the Investors an aggregate of 41 units at a purchase price of $50,000 per Unit. Each Unit is comprised of (i) 100,000 shares of the Company's common stock, $.001 par value per share; and (ii) a three-year warrant to purchase 100,000 shares of Common Stock at an exercise price of $0.75 per share, subject to adjustment for stock splits, stock dividends, recapitalizations and similar events. In the initial closing, the Company sold 41 Units and received net proceeds of approximately $1.8 million after payment of placement agent fees and costs relating to the Private Placement. Pursuant to the terms of the Private Placement, the Company may issue up to an additional 39 Units, for a total 80 Units, at a price of $50,000 per Unit. The net proceeds from the Private Placement will be used to fund the Company ongoing operations and to provide working capital. In consideration for services rendered as the placement agent in the Private Placement, upon the initial closing, the Company paid the placement agent cash commissions and an expense allowance fee aggregating $191,500. In addition, as consideration for services rendered in connection with the Private Placement, at the final closing date of the Private Placement, the Company will sell to the placement agent (i) warrants to purchase 10,000 shares of Common Stock for each Unit sold in the private placement at an aggregate cost of $10.00, and (ii) 10,000 warrants identical to those sold to Investors. The Placement Agent Warrants will have a term of five years and shall be exercisable at $0.60 per share, subject to adjustment for stock splits, stock dividends, recapitalizations and similar events. The Placement Agent Warrants will also contain weighted average anti-dilution protection, cashless exercise provisions and "piggy-back" registration rights during the lifetime of the Placement Agent Warrants. The Units were offered and sold in reliance upon exemptions from registration under the Securities Act of 1933, as amended in reliance on Section 4(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder, as transactions by an issuer not involving a public offering. The subscription agreements executed in connection with the transactions contain representations from the Investors to support our reasonable belief that: (i) the Investors either received or had access to adequate information concerning the Company's operations and financial condition in order to make an informed investment decision, (ii) the Investors acquired the Units for their own account for investment purposes only and not with a view to the distribution thereof in the absence of an effective registration statement or an applicable exemption from registration, and (iii) the Investors are sophisticated within the meaning of Section 4(2) of the Securities Act and are "accredited investors." Neither the shares of Common Stock nor the Investor Warrants or Placement Agent Warrants, or the Common Stock issuable upon exercise thereof, have been registered under the Securities Act nor may any such securities be offered or sold absent registration or an applicable exemption from registration. The Company has agreed to file a registration statement with the Securities and Exchange Commission, within 90 days of the final closing of the Private Placement, covering the resale by the Investors of the shares of Common Stock issued in the Private Placement as well as the resale by the Investors and the placement agent of the shares of Common Stock issuable upon the exercise of the Investor Warrants and Placement Agent Warrants. Until this registration statement is declared effective by the SEC those shares of Common Stock may not be transferred or resold unless the transfer or resale is registered or unless exemptions from the registration requirements of the Securities Act and applicable state laws are available. About Spot Mobile Spot Mobile, formerly Rapid Link Incorporated -- http://www.rapidlink.com/-- is a telecommunications services company which, through its wholly owned subsidiary, provides prepaid telecommunication and transaction based point of sale activation solutions through 1,000 independent retailers in the Eastern United States. The Company also provides long distance services and plans to expand its product offering to include mobile and wireless services. KBA GROUP LLP in Dallas, Texas, expressed substantial doubt about Rapid Link's ability to continue as a going concern after auditing the Company's financial statements as of October 31, 2008. The auditor noted the Company has suffered recurring losses from continuing operations during the last two fiscal years. At October 31, 2008, the Company's current liabilities exceeded its current assets by $2.1 million and the Company has a shareholders' deficit totaling $2.9 million. The Company's balance sheet at July 31, 2010, showed $2.62 million in total assets, $3.90 million in total liabilities, and a $1.28 million stockholders' deficit. STARBRITE PROPERTIES: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Starbrite Properties Corp. 626 Flatbush Avenue Brooklyn, NY 11225 Bankruptcy Case No.: 11-40758 Chapter 11 Petition Date: February 1, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Carla E. Craig Debtor's Counsel: Peter J. Mollo, Esq. 266 Smith Street Brooklyn, NY 11231 Tel: (718) 858-3401 Fax: (718) 858-3035 E-mail: pjmollo@earthlink.net Scheduled Assets: $3,026,500 Scheduled Debts: $3,240,616 The Company did not file a list of creditors together with its petition. The petition was signed by William Cordero, president. STRAWBERRY PARK: Court Dismisses Involuntary Chapter 11 Case ------------------------------------------------------------ On January 26, 2011, the U.S. Bankruptcy Court for the District of Connecticut, upon the motion of petitioning creditor The Citizens National Bank, dismissed the involuntary Chapter 11 case the bank and two other creditors filed against the Debtor. A copy of the dismissal order is available for free at: http://bankrupt.com/misc/StrawberryPark.dismissalorder.pdf About Strawberry Park The Citizens National Bank, Richard I. Rothstein, and Joseph Biber made an involuntary Chapter 11 filing against Strawberry Park RV Resort, Inc. (Bankr. D. Conn. Case No. 10-24277) on December 17, 2010. According to Greg Smith at Norwich Bulletin, the involuntary filing came before the December 20 deadline set by the court to move to a February 26, 2011 foreclosure sale. Preston Strawberry Associates of Norwalk, which claims $3.4 million from Mr. Biber from a defaulted loan, had secured the court agreement to avoid any further delays. Mr. Smith relates that the Strawberry Park campground, now being run by a court-appointed management, already was the subject of a more than $8 million court judgment in favor of TD Bank. A previous manager reported to the court that Mr. Biber was routinely overdrawing bank accounts, writing checks he could not cover and digging himself deeper into debt. Judge Albert S. Dabrowski presides over the case. Mark E. Block, Esq., at Block Janney & Pascal LLC, represents the petitioners. SUNRISE SENIOR: Greg Neeb's Employment Extended to 2013 ------------------------------------------------------- On January 25, 2011, the Compensation Committee of the Board of Directors of Sunrise Senior Living, Inc. approved an Amended and Restated Employment Agreement with Greg Neeb, the Company's Chief Investment and Administrative Officer. The Restated Agreement is effective as of January 25, 2011. The Restated Agreement has substantially the same terms and conditions as Mr. Neeb's original employment agreement which was effective as of January 21, 2009. Pursuant to the Restated Agreement, Mr. Neeb's employment term has been extended from January 21, 2012 to January 25, 2013, with automatic one-year renewals at the end of that term and each year thereafter unless either party otherwise provides notice to the other at least 120 days prior to the next renewal. In connection with the execution of the Restated Agreement, the Compensation Committee granted Mr. Neeb, on January 25, 2011, an option to purchase 500,000 shares of the Company's common stock at $7.31 per share, the closing price of the Company's common stock on January 25, 2011, with such Re-Signing Options vesting ratably on each of January 25, 2012, 2013 and 2014, so long as Mr. Neeb continues to be employed with the Company on such vesting date. In addition, within 14 days of the execution of the Restated Agreement, Mr. Neeb will receive from the Company a cash re- signing bonus of $2 million. In consideration for the Re-Signing Options and the Re-Signing Bonus, under the Restated Agreement, Mr. Neeb may terminate his employment prior to January 25, 2013 only with "Good Reason" -- as defined in the Restated Agreement -- or with the express written consent of the Board of Directors of the Company. In the event that Mr. Neeb terminates his employment for any other reason prior to January 25, 2013, he will be considered in breach of the Restated Agreement and will forfeit the Re-Signing Bonus. In addition, in the event that Mr. Neeb terminates his employment as a result of a Consensual Resignation, he will forfeit either all or two-thirds of the Re-Signing Options. The goal of these provisions is to ensure, to the extent practicable, that the Company will retain the services of Mr. Neeb for at least the next two years. The Restated Agreement also eliminates the "golden parachute" excise tax gross-up provision that was included in Mr. Neeb's original employment agreement. In addition, if allowed by the Company's health benefits plans, in the event Mr. Neeb's employment is terminated: (a) as a result of Mr. Neeb's death or disability, by Mr. Neeb for Good Reason or by the Company without Cause; (b) by Mr. Neeb pursuant to a Consensual Resignation before January 25, 2013; or (c) by Mr. Neeb other than for Good Reason on or after January 25, 2013, Mr. Neeb will be entitled to purchase at his expense group health benefits offered to the Company's active employees generally covering Mr. Neeb, his spouse and his children until he attains, or in the case of death, would have attained age 65. The Re-Signing Options have a term of 10 years. In the event that Mr. Neeb's employment is terminated (i) by reason of his death or "Disability":, (ii) by the Company other than for "Cause" or (iii) by Mr. Neeb for "Good Reason" on or after January 25, 2013, Mr. Neeb's Re-Signing Options will vest in full. If a severance- qualifying termination occurs prior to January 25, 2013, one-third of the Re-Signing Options will accelerate and vest plus a pro-rata portion of an additional one-third will accelerate and vest for the vesting year in which Mr. Neeb's termination occurs. In addition, in the event that Mr. Neeb's employment is terminated by the Company other than for "Cause" or by Mr. Neeb for "Good Reason" either (i) within two years following a Change in Control or (ii) prior to a Change in Control, but after the execution of a definitive agreement providing for such a Change in Control and such termination arose in connection with or in anticipation of such Change in Control, then all of the Re-Signing Options will vest in full. In connection with the Company's desire to reduce ongoing general and administrative expense by combining the chief financial officer and chief accounting officer positions, on January 31, 2011, Sunrise's Board of Directors approved (a) the termination of employment of Julie A. Pangelinan, the Company's current Chief Financial Officer, effective on or before March 11, 2011 and (b) the appointment of C. Marc Richards, the Company's current Chief Accounting Officer, as the Company's new Chief Financial Officer, effective as of Ms. Pangelianan's Termination Date. Ms. Pangelinan's termination of employment will constitute a termination of employment other than for Cause, as such term is defined in Ms. Pangelinan's employment agreement with the Company, as amended. Pursuant to the Employment Agreement, subject to Ms. Pangelinan's execution of a release of claims against the Company and its officers, directors and affiliates, Ms. Pangelinan will be entitled to receive within 30 days of her departure date severance benefits that include a lump sum cash payment of $1.1 million, which equals two years of base salary and 75% of her target bonus amount, plus health care continuation coverage under COBRA at the Company's expense for up to 18 months following her Termination Date. In addition, the remaining unvested portion (166,666 shares) of an option granted to her in December 2008 will accelerate and vest. The exercise price of the option is $1.37 per share. Ms. Pangelinan will also be eligible to receive the remaining portion of her annual bonus for 2010, which bonus will be determined by the Compensation Committee at its February 2011 meeting. On January 31, 2011, the Compensation Committee approved an employment agreement for Mr. Richards, effective as of the New CFO Effective Date. Mr. Richards' employment agreement will provide for an initial three-year employment term commencing on the New CFO Effective Date, with automatic one-year renewals at the end of that term and each year thereafter unless either party provides notice to the other, at least 120 days prior to the next renewal date, that the term will not be extended. Under the employment agreement, Mr. Richards will receive an annual base salary for 2011 of $300,000 as Chief Financial Officer and will be eligible for an annual bonus for 2011 of a pro-rated amount reflecting his target annual bonus of 50% of his $235,000 annual base salary during the portion of 2011 during which he shall have served as Chief Accounting Officer and a target annual bonus of 100% of his $300,000 annual salary for the balance of 2011 during which he will be serving as Chief Financial Officer. His actual annual bonus for 2011 may be higher or lower than such target annual bonus depending on the actual performance of the Company and Mr. Richards, as determined by the Compensation Committee in its sole discretion. Thereafter, for 2012 and beyond, Mr. Richards will be eligible for an annual bonus under the Company's annual incentive plan in a target amount equal to 100% of his annual base salary, subject to the achievement of applicable performance goals. In addition, the Compensation Committee approved a grant to Mr. Richards of 100,000 shares of restricted stock effective on the New CFO Effective Date. The restricted stock will vest at a rate of one-third on each of the first three anniversaries of the New CFO Effective Date, subject to Mr. Richards' continued employment on the applicable vesting date. Pursuant to Mr. Richards' employment agreement, in the event that his employment is terminated by the Company other than for Cause, death or Disability or by the executive for Good Reason, the Company will pay Mr. Richards accrued obligations and, subject to his execution of a general release of claims, a lump sum severance payment within 30 days following the date of termination in an amount equal to the sum of (i) two times Mr. Richards' annual base salary and (ii) 0.75 times his target annual bonus amount. In addition, if Mr. Richards makes a timely election to receive COBRA coverage, the Company will pay the cost of that coverage during the period it remains in effect, not to exceed 18 months following the date of termination. For purposes of Mr. Richards' employment agreement, the definitions of "Cause", "Disability" and "Good Reason" will be the same as those contained in Ms. Pangelinan's Employment Agreement. If that termination of employment occurs on or after the second anniversary of the New CFO Effective Date, Mr. Richards' restricted stock will vest in full, subject to his execution of a general release of claims; if such termination occurs prior to the second anniversary of the New CFO Effective Date, Mr. Richards' unvested restricted stock will, subject to his execution of a general release of claims, will vest as to one-third of the restricted stock, plus an additional number of shares of restricted stock equal to the product of one-third of the number of shares of restricted stock times a fraction, the numerator of which is the number of days from the latest anniversary of the New CFO Effective Date through the date of termination and the denominator of which is 365. If, however, Mr. Richards' employment is terminated by the Company other than for Cause, death or Disability or him for Good Reason and either: * that termination occurred within two years following a Change of Control; or * that termination occurred prior to a Change of Control, but after the execution of a definitive agreement providing for a Change of Control, and such termination arose in connection with or anticipation of such Change of Control, then, in lieu of the severance benefits, the Company will pay Mr. Richards (i) accrued obligations, and (ii) a lump sum severance payment equal to the product of two and the sum of Mr. Richards' annual base salary and average annual bonus in respect of the two fiscal years of the Company immediately preceding the year in which the Change of Control occurs. In addition, Mr. Richards will receive his target bonus for the year of termination, pro- rated through the date of termination, and Company-paid COBRA coverage for up to 18 months following the date of termination. Finally, the restricted stock will vest in full. Pursuant to Mr. Richards' employment agreement and the Company's recoupment policy, any incentive or equity compensation paid to Mr. Richards will be subject to recoupment in the event of a restatement of the Company's consolidated financial statements, to the extent such compensation would not otherwise have been received based on the restated financial statements. Pursuant to his employment agreement, Mr. Richards will be subject to covenants of non-competition and non-solicitation of the Company's employees and customers during his employment and for a period of two years thereafter, and to perpetual duties of confidentiality and non-disparagement. Except for Mr. Richards' base salary and target bonus for 2011, the foregoing employment agreement provisions are the same as contained in Ms. Pangelinan's Employment Agreement. Mr. Richards' employment agreement, however, will not contain a "golden parachute" excise tax gross-up provision. Mr. Richards, age 39, joined the Company as its Chief Accounting Officer in July 2009. From November 2007 to July 2009, he was a Vice President of JE Robert Companies and functioned as the Controller for JER Investors Trust, a publicly traded real estate investment trust that invests in real estate loans, commercial mortgage backed securities and other structured finance products. While serving in this capacity, Mr. Richards supervised the accounting and financial reporting functions, Sarbanes-Oxley Act compliance and REIT tax compliance of JER Investors Trust. From May 2006 to October 2007, Mr. Richards served as Vice President and Corporate Controller of Republic Property Trust, a publicly traded owner, operator and redeveloper of commercial office buildings in the Metropolitan D.C area, which was acquired by Liberty Property Trust in August 2007. In this role, Mr. Richards supervised the accounting and financial reporting functions of Republic Property Trust. From July 1999 to May 2006, Mr. Richards served in a variety of accounting positions with increasing responsibilities at The Mills Corporation, a publicly traded developer, owner and manager of a diversified portfolio of regional shopping malls and retail entertainment centers, which was acquired by Simon Property Group and Farallon Capital in May 2007. These positions included, among others, Group Vice President of Corporate Accounting (until May 2006) and Vice President of Corporate and Property G/L Accounting (2004-2006). About Sunrise Senior McLean, Va.-based Sunrise Senior Living, Inc. (NYSE: SRZ) -- http://www.sunriseseniorliving.com/-- is a provider of senior living services in the United States, Canada, the United Kingdom and Germany. At June 30, 2010, the Company operated 356 communities, including 307 communities in the United States, 15 communities in Canada, seven communities in Germany and 27 communities in the United Kingdom, with a total unit capacity of roughly 35,400. The Company's balance sheet at Sept. 30, 2010, showed $780.83 million in total assets, $693.66 million in total liabilities, and stockholders' equity of $87.17 million. As reported in the Troubled Company Reporter of March 3, 2010, Ernst & Young LLP, in McLean Va., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company cannot borrow under its bank credit facility and the Company has significant debt maturing in 2010 which it does not have the ability to repay. SUPERIOR ACQUISITIONS: Creditor Wants Case Converted to Chapter 7 ----------------------------------------------------------------- Secured creditor DRMG, LLC, requests the U.S. Bankruptcy Court for the Northern District of California to convert the Chapter 11 case of Superior Acquisitions, Inc., to a Chapter 7 proceeding, or in the alternative, for dismissal of the Debtor's bankruptcy case. In support of its motion, DRMG says Debtor has: -- engaged in rampant cash collateral violations; -- incurred substantial real property tax delinquencies; -- not properly insured estate property, including DRMG's collateral; -- accumulated 102 Code violations with respect to the Willow Point Property, rendering half of the rental units unusable; -- has failed to satisfy numerous Court filing requirements and deadlines; -- failed to pay DRMG's monthly debt service for many months (and with respect to the Willow Point property, has not made payments since April of 2009); and -- no realistic potential to reorganize. About Superior Acquisitions Lakeport, California-based Superior Acquisitions, Inc., filed for Chapter 11 bankruptcy protection on September 28, 2010 (Bankr. N.D. Calif. Case No. 10-13730). Michael C. Fallon, Esq., represents the Debtor in the Chapter 11 case. In its schedules, the Debtor disclosed assets of $13,889,530 and liabilities of $14,866,437 as of the Petition Date. TRIBUNE CO: Professionals File Fee Applications for Sept.-Nov. -------------------------------------------------------------- Pursuant to Sections 330 and 331 of the Bankruptcy Code, professionals of the Debtors and the Official Committee of Unsecured Creditors filed with the Court applications for fees and reimbursement of expenses. A. Debtors' Professionals Professional Period Fees Expenses ------------ ------ ---- -------- Alvarez & Marsal 09/01/10- North America, LLC 11/30/10 $1,567,691 $7,013 Dow Lohnes PLLC 09/01/10- 11/30/10 405,266 2,372 Mercer (US) Inc. 09/01/10- 11/30/10 31,346 15,435 Lazard Freres & Co. LLC 09/01/10- 11/30/10 600,000 26,749 Seyfarth Shaw LLP 09/01/10- 11/30/10 207,885 12,677 Daniel J. Edelman, Inc. 09/01/10- 11/30/10 37,756 234 Jenner & Block LLP 09/01/10- 11/30/10 47,764 3,152 Dow Lohnes PLLC 12/01/10- 12/31/10 112,521 346 Dow Lohnes serves as regulatory counsel to the Debtors. Alvarez & Marsal acts as restructuring advisors to the Debtors. Mercer (US) is the Debtors' compensation consultant. Lazard Freres acts as financial advisor to the Debtors. Seyfarth Shaw is the Debtors' litigation counsel. Daniel J. Edelman acts as investor relations consultant to the Debtors. Jenner & Block serves as special counsel to the Debtors. B. Professionals of the Official Committee of Unsecured Creditors Professional Period Fees Expenses ------------ ------ ---- -------- Chadbourne & Parke LLP 09/01/10- 11/30/10 $5,205,307 $422,174 Chadbourne & Parke LLP 12/01/10- 12/31/10 1,337,478 99,960 Landis Rath & Cobb LLP 09/01/10- 11/30/10 940,688 193,235 AlixPartners, LLP 09/01/10- 11/30/10 791,650 7,737 AlixPartners, LLP 12/01/10- 12/31/10 141,125 4,585 Zuckerman Spaeder LLP 09/01/10- 11/30/10 868,159 559,304 Landis Rath & Cobb LLP 12/01/10- 12/31/10 299,218 107,367 Moelis & Company LLC 12/01/10- 12/31/10 200,000 0 Chadbourne & Parke and Landis Rath act as co-counsel to the Committee. AlixPartners serves as the Committee's financial advisor. Zuckerman Spaeder serves as the Committee's counsel. Landis Rath serves as co-counsel to the Committee. Moelis & Company serves as investment banker to the Committee. Fee Examiner's Report Stuart Maue, in its capacity as fee examiner, submitted with the Court a final report regarding the interim fee application of these professionals: Recommended Recommended Professional Period Fees Expenses ------------ -------- ----------- ----------- Ernst & Young LLP 09/01/09- 11/30/09 $58,285 $100 Daniel J. Edelman 03/01/10- Inc. 05/31/10 1,575 33 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: Court Approves Sale of Three Vessels -------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Trico Marine Services, Inc., and its debtor affiliates to sell three vessels to the successful bidders in an auction held January 24, 2011. Previously, the Debtor notified the Court the successful and back- up bidders with respect to the sale of three vessels: Successful Back-Up Vessel Bidder Offer Bidder Offer ------ ---------- ----- ------- ----- Buffalo River Sea Lyon $195,000 Blanco $190,000 Marine Inc. Offshore Logistics SA de C.V. James River Arfersi $820,000 Olmeca $800,000 SA de C.V. SA de C.V. Pearl River Naviera $695,000 Blanco $680,000 Mexicana Offshore Neptuno Logistics SA de C.V. SA de C.V. Each of the Vessels is being sold "as is where is," and closing is to occur whenever the Debtors are in a position to close. A deposit of 20% of the final purchase price was to be made by January 27, 2011, by the Successful Bidder and the Back-Up Bidder. The Court also approved the payment of a break-up fee of $15,000 to Blanco Offshore Logistics, S.A. de C.V. (the back-up bidder for the Pearl River), payable at the closing of the sale from the sale proceeds. On the closing date, the buyer is directed to wire all sale proceeds, less the MARAD payoff, the Hondo Deposit and the Spirit Deposit to an escrow at Wilmington Trust Company. At or prior to the closing date, the Debtors will provide The Bank of Mellon Trust Company, N.A., as successor indenture trustee, with 40 to 60 days notice of the redemption of all remaining MARAD Notes. The buyer will wire to BNY Mellon, an amount equal to all of the outstanding principal of $4,400,000, plus estimated interest and BNY Mellon's reasonable fee and expenses (estimated to be $155,489, under the $18,900,000 of notes due in 2014 and secured by the first priority liens of MARAD. In addition, from the sale proceeds deposited into the escrow on the closing date, the Debtors will reserve a good-faith estimate of the make-whole premium asserted by BNY Mellon in connection with the payment of the MARAD Notes (estimated to be $535,000). In a separate order, the Court also authorized the Debtor to sell the Hondo River and the Spirit River to Odyssea Vessels, Inc. On January 24, Odyssea Vessels offered to purchase the Hondo River and Spirit River for $13,000,000, en bloc, from. After consultation with the official committee of unsecured creditors , Obsidian Agency Services, Inc., as agent under the senior secured, super-priority debtor-in-possession credit agreement dated August 24, 2010, and holders of the Debtors' 8.125% notes, the Debtors, accepted the offer from Odyssea as the highest and best offer for the Vessels. 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. ULTIMATE ACQUISITION: Organizational Meeting Set for Feb. 9 ----------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on February 9, 2011, at 10:30 a.m. in the bankruptcy case of Ultimate Acquisition Partners, LP , et al. The meeting will be held at DoubleTree Hotel Wilmington, 700 N King Street, Wilmington, Delaware 19801. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. 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. UNITED CONTINENTAL: AFA & IAM Seek Union Elections -------------------------------------------------- The Association of Flight Attendants-CWA asked the National Mediation Board to declare that the United/Continental merger has created a single transportation system, triggering a representation election for the combined Flight Attendant workforce, according to a public statement dated January 19, 2011. If the NMB agrees, then a union election would be held to determine the collective bargaining representative. More than 15,000 United Flight Attendants already are represented by AFA. "This merger and the extraordinary financial turnaround underway at United are only possible because Flight Attendants at both airlines have invested hard work and sacrifices over the years," said Greg Davidowitch, AFA United President. "Management must know that the Flight Attendant workforce is unified, and that we expect the best Flight Attendant contract at the world's leading airline. Joined together in AFA we can ensure Flight Attendants are full partners in the merger with compensation that reflects our key role in the success of the new United Airlines." Once the NMB declares that the merged airlines are operating as a single carrier, an election date will be set to determine if AFA will be the Flight Attendants' exclusive bargaining agent for the combined Flight Attendant workforce. With approximately 24,000 Flight Attendants eligible to vote, the election will be among the largest ever conducted by the NMB, the federal agency charged with overseeing union elections and the collective bargaining process in the airline industry. The Flight Attendant contracts at United and Continental will remain in place after the vote. Prior to an operational merger management would be required to negotiate a single Flight Attendant contract that would be ratified by the combined Flight Attendant workforce. "As the world's largest Flight Attendant union, run by and for Flight Attendants, this is a wonderful opportunity to welcome our flying partners at Continental to AFA," said Veda Shook, AFA International President. "AFA has been the leader in advancing the Flight Attendant profession since a group of United Flight Attendants joined together in 1945 to create our union. Throughout the years, AFA has fought for and won major changes in our industry; we have transformed our profession, raising wages, benefits and working conditions and improving safety and security. In welcoming our Continental colleagues, we will continue to make great strides for Flight Attendants and their families." Nearly 50,000 Flight Attendants, including the 16,000 Flight Attendants at United, join together to form AFA, the world's largest Flight Attendant union. AFA -- http://www.unitedafa.org-- is part of the 700,000 member- strong Communications Workers of America, AFL -CIO. * * * Early this month, United flight attendants staged protests for a new contract, saying they were tired of wage cuts and terminated pensions, Portland News related. In an interview with Fox 12, United said it is committed to working with the union to develop fair contracts, the report said. * * * In a public statement dated January 21, 2011, The International Association of Machinists and Aerospace Workers said it filed two applications with the NMB asking the Board to rule that United Airlines and Continental Airlines are now operating as a single transportation system for union representation purposes in the Fleet/Ramp Service and Stock & Stores classifications. The NMB is the federal government agency that conducts union elections in the airline industry. "United and Continental have substantially integrated their Ramp and Stores operations and are operating as a single carrier for representation purposes in these classifications," said IAM General Vice President Robert Roach, Jr. "Ramp and Stores employees at both airlines have demonstrated tremendous support for the Machinists Union and they will be the first of what we expect will be many IAM members at the new United Airlines," Mr. Roach added The IAM represents United's 6,800 Ramp and 640 Stores employees. Continental's 225 Stock & Stores employees are unrepresented, and the 7,000 Fleet Service employees of Continental and Continental Micronesia are currently represented by a different union. "The IAM is excited about the future of the new United Airlines in which each carriers' Ramp and Stores employees are united under the IAM umbrella," said IAM District 141 President Rich Delaney. "We all have the same goals of better wages, job security and a secure retirement. The IAM is the only union that can leverage the bargaining power of 55,000 United employees to achieve our common goals." In accordance with NMB guidelines, separate single carrier applications and determinations must be made for each employee classification following an airline merger. The Machinists Union is the largest airline union in North America. More information about the IAM is available at http://www.goiam.org About United Continental United Continental Holdings, Inc. (NYSE: UAL) -- http://www.UnitedContinentalHoldings.com/, http://www.united.com/ and http://www.continental.com/-- is the holding company for both United Airlines and Continental Airlines. Together with United Express, Continental Express and Continental Connection, these airlines operate a total of approximately 5,800 flights a day to 371 airports throughout the Americas, Europe and Asia from their hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles, New York, San Francisco, Tokyo and Washington, D.C. United and Continental are members of Star Alliance, which offers more than 21,200 daily flights to 1,172 airports in 181 countries worldwide through its 28 member airlines. United's and Continental's more than 80,000 employees reside in every U.S. state and in many countries around the world. United Continental carries 'B2' corporate family and probability of default ratings, with stable outlook, from Moody's, 'B' issuer credit ratings, with stable outlook, from Standard & Poor's, and 'B-' issuer default rating from Fitch. UAL Corp filed for Chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors. Judge Eugene R. Wedoff confirmed a reorganization plan for United on Jan. 20, 2006. The Company emerged from bankruptcy on Feb. 1, 2006. At Sept. 30, 2010, United Continental had $20.055 billion in total assets against total current liabilities of $8.256 billion, long- term debt of $6.025 billion, long-term obligations under capital leases of $906 million, other liabilities and deferred credits of $7.074 billion, and a stockholders' deficit of $2.206 billion. UNITED CONTINENTAL: Reports December 2010 Traffic Results --------------------------------------------------------- United Continental Holdings, Inc. (NYSE: UAL) reported December 2010 and full-year 2010 operational results for United Air Lines, Inc. and Continental Airlines, Inc. United and Continental's combined consolidated traffic (revenue passenger miles) in December 2010 increased 1.4 percent versus December 2009 on a consolidated capacity increase of 2.3 percent. The carriers' combined consolidated load factor decreased 0.7 points compared to the same period last year. United and Continental's December 2010 combined consolidated passenger revenue per available seat mile (PRASM) increased an estimated 7.5 to 8.5 percent compared to December 2009, while mainline PRASM increased an estimated 8.5 to 9.5 percent compared to the same period last year. In December, the carriers implemented a revenue sharing structure for their trans-Atlantic joint venture, retroactive to Jan. 1, 2010. While the impact of the joint venture obligations for the first through third quarter 2010 will be booked as a charge in Other Operating Expense in United Continental Holdings' statement of consolidated operations, the fourth quarter impact and all future adjustments will be booked as adjustments to passenger revenue. The fourth quarter adjustment, which was booked entirely in the month of December, reduced the carriers' December consolidated PRASM by approximately 1.0 point and is included in the above consolidated PRASM estimate. The snowstorms during the month of December resulted in an estimated $25 million reduction in consolidated passenger revenue, included in the above consolidated PRASM estimate, and a $10 million reduction in net earnings for the quarter. Combined United and Continental Pro Forma Preliminary Operational Results 2010 2009 Percent Dec. Dec. Change ----- ----- ------- Revenue passenger miles ('000) North America 7,858,291 8,003,593 (1.8%) International 7,069,016 6,795,374 4.0% Atlantic 2,922,123 2,964,483 (1.4%) Pacific 2,735,219 2,485,162 10.1% Latin America 1,411,674 1,345,729 4.9% Mainline 14,927,307 14,798,967 0.9% Regional 2,069,155 1,963,059 5.4% Consolidated 16,996,462 16,762,026 1.4% Available seat miles ('000) North America 9,496,043 9,654,499 (1.6%) International 8,591,234 8,119,595 5.8% Atlantic 3,587,004 3,504,947 2.3% Pacific 3,222,436 2,949,439 9.3% Latin America 1,781,794 1,665,209 7.0% Mainline 18,087,277 17,774,094 1.8% Regional 2,721,244 2,571,256 5.8% Consolidated 20,808,521 20,345,350 2.3% Passenger load factor North America 82.8% 82.9% (0.1pts.) International 82.3% 83.7% (1.4pts.) Atlantic 81.5% 84.6% (3.1pts.) Pacific 84.9% 84.3% 0.6pts. Latin America 79.2% 80.8% (1.6pts.) Mainline 82.5% 83.3% (0.8pts.) Regional 76.0% 76.3% (0.3pts.) Consolidated 81.7% 82.4% (0.7pts.) Onboard passengers ('000) Mainline 8,055 8,188 (1.6%) Regional 3,661 3,565 2.7% Consolidated 11,716 11,753 (0.3%) Cargo revenue ton miles ('000) Total 244,714 251,995 (2.9%) Combined United and Continental Pro Forma Preliminary Financial Results Change ------ November 2010 year-over-year consolidated PRASM change 11.7% November 2010 year-over-year mainline PRASM change 12.4% December 2010 estimated year-over-year consolidated PRASM change 7.5% to 8.5% December 2010 estimated year-over-year mainline PRASM change 8.5% to 9.5% December 2010 estimated consolidated average price per gallon of fuel, including fuel taxes $2.49 Fourth Quarter 2010 estimated consolidated average price per gallon of fuel, including fuel taxes $2.44 Preliminary December Operational Results for United 2010 2009 Change ---- ---- ------ On-Time Performance 83.1% 77.3% 5.8pts. Completion Factor 97.9% 97.2% 0.7pts. GAAP to Non-GAAP Reconciliations Pursuant to SEC Regulation G, the company has included the following reconciliation of reported non-GAAP financial measures to comparable financial measures reported on a GAAP basis. Since the Company did not apply cash flow hedge accounting prior to April 1, 2010, the Company believes that the net fuel hedge adjustments provide management and investors with a better perspective of its performance and comparison to its peers because the adjustments reflect the economic fuel cost during the periods presented and many of our peers apply cash flow hedge accounting. The non-cash mark-to-market gain/loss adjustment includes the reversal of prior period non-cash mark-to-market gain/loss related to actual December and actual fourth quarter hedge settlements. Combined United and Continental Pro Forma Dec. 2010 4Q 2010 --------- --------- Consolidated fuel price per gallon (GAAP) $2.50 $2.46 Less: Non-cash, net mark-to-market gains and (losses) per gallon (0.01) (0.02) --------- --------- Consolidated fuel price per gallon excluding non-cash, net mark-to-market gains and losses $2.49 $2.44 ========= ========= About United Continental United Continental Holdings, Inc. (NYSE: UAL) -- http://www.UnitedContinentalHoldings.com/, http://www.united.com/ and http://www.continental.com/-- is the holding company for both United Airlines and Continental Airlines. Together with United Express, Continental Express and Continental Connection, these airlines operate a total of approximately 5,800 flights a day to 371 airports throughout the Americas, Europe and Asia from their hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles, New York, San Francisco, Tokyo and Washington, D.C. United and Continental are members of Star Alliance, which offers more than 21,200 daily flights to 1,172 airports in 181 countries worldwide through its 28 member airlines. United's and Continental's more than 80,000 employees reside in every U.S. state and in many countries around the world. United Continental carries 'B2' corporate family and probability of default ratings, with stable outlook, from Moody's, 'B' issuer credit ratings, with stable outlook, from Standard & Poor's, and 'B-' issuer default rating from Fitch. UAL Corp filed for Chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors. Judge Eugene R. Wedoff confirmed a reorganization plan for United on Jan. 20, 2006. The Company emerged from bankruptcy on Feb. 1, 2006. At Sept. 30, 2010, United Continental had $20.055 billion in total assets against total current liabilities of $8.256 billion, long- term debt of $6.025 billion, long-term obligations under capital leases of $906 million, other liabilities and deferred credits of $7.074 billion, and a stockholders' deficit of $2.206 billion. U.S. DRY CLEANING: Disclosure Statement Hearing Set for Feb. 9 -------------------------------------------------------------- On January 3, 2011, U.S. Dry Cleaning Services Corp. and its affiliates filed with the U.S. Bankruptcy Court for the Central District of California a Chapter 11 Plan of Reorganization and a related disclosure statement. The Disclosure Statement hearing will be held on February 9, 2011, at 9:00 a.m., at Courtroom "5D" 411 W. Fourth Street, in Santa Ana, Calif. The Plan provides for the Debtors' emergence from their Chapter 11 cases as one consolidated entity under U.S. Dry Cleaning Services Corporation, which the Debtors anticipate will occur in March 2011. Pursuant to the Plan terms, the Plan will be funded by new financing in the sum of approximately $12 million to be raised by INTL Provident Group, the Debtors' investment banker, through a private offering of the Reorganized Debtor's new debt and/or equity securities. This $12 million will be used to, among other things, fund the Plan and provide the Reorganized Debtor with sufficient working capital to implement its growth strategy. Under the terms of Provident's engagement, after securing the Exit Financing and after the Effective Date, Provident will engage with the Reorganized Debtor towards a public offering on a "firm commitment" basis, subject to the conditions contained in its engagement letter. Under the Plan, creditors will receive New COMMON STOCK issued in connection with a public offering. The prepetition senior secured claims of the Setal Entities will be satisfied as follows: (i) a $5 million cash payment on the Effective Date; (ii) issuance of a $4.1 million subordinated secured convertible note upon the same terms and conditions as the New Debt Securities; (iii) 420,000 shares of New Common Stock on the Effective Date; and (iv) conversion of approximately $8.2 million of secured debt into New Common Stock at the Discounted Stock Price in connection with the Subsequent Public Offering or, if no Subsequent Public Offering is effected within 12 months after the Effective Date of the Plan, then the conversion of approximately $8.2 million of secured debt into New Common Stock at the rate of one (1) share for each $5.00 of secured debt. Other senior secured creditors will be: (a) paid in cash on the Effective Date; (b) paid over time pursuant to agreement with the Debtors; or (c) paid with a partial cash payment upon the Effective Date and a subordinated secured convertible note. General unsecured creditors, estimated collectively to be $10 million, will receive on a pro rata basis $1 million in cash on the Effective Date, with the balance of approximately $9 million converted into New Common Stock at the Discounted Stock Price in connection with the Subsequent Public Offering or, if no Subsequent Public Offering is effected within 12 months after the Effective Date of the Plan, then the approximate $9.0 million of secured debt into New Common Stock of the Reorganized Debtor at the rate of one (1) share for each $10.00 of secured debt. Holders of priority tax claims, estimated to be $750,000, will be paid in equal quarterly payments with interest over an approximate four year period (except for certain small priority tax claims that will be paid in Cash on the Effective Date). Holders of convertible preferred stock will be deemed to have fully converted into the Reorganized Debtor's common stock on the Effective Date at the rate of 110% of the applicable conversation rate. Holders of common stock, including the post-conversion Preferred Stock will receive one share of New Common Stock for every 25 shares of stock held on the Record Date and surrendered to the transfer agent. A full-text copy of the Chapter 11 Plan is available for free at: http://researcharchives.com/t/s?72c1 About U.S. Dry Cleaning Services Newport Beach, California-based U.S. Dry Cleaning Services Corporation (d/b/a US Dry Cleaning Corporation) currently owns and operates seventy-one (71) dry cleaning stores and three processing plants in the United States. USDC and seven of its affiliates filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the Central District of California on March 4, 2010. Simon Aron, Esq., and Susan K. Seflin, Esq., at Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP, are the attorneys for the Debtors. The cases are jointly administered under Enivel, Inc., Case No. 10-12735. Charles T. Moffitt is the Debtors' Chief Restructuring Officer. The Company estimated its assets at $1 million to $10 million and debts at $10 million to $50 million. US AIRWAYS: Downgraded by Soleil Securities to "Hold" ----------------------------------------------------- American Banking & Market News reports that equities research analysts at Soleil Securities downgraded shares of US Airways Group, Inc., from a "buy" rating to a "hold" rating in a research note to clients and investors on January 12. The analysts, the report notes, currently have a $12.00 price target on the stock. Separately, analysts at Zacks Investment Research reiterated a "neutral" rating on shares of US Airways Group, Inc., in a research note to investors on December 28, 2010, American Banking & Market News adds in the report. About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). As of Sept. 30, 2010, US Airways had $8.006 billion in total assets, $3.049 billion in current liabilities, $4.883 billion in non-current liabilities, and $74 million in stockholders' equity. * * * US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: To Cut 90 Jobs at Pittsburgh Int'l Airport ------------------------------------------------------ A report by GCTL8.com says that US Airways intends to cut more than 90 jobs at Pittsburgh International Airport as part of plans to cut 170 jobs nationwide due to reduced demand and other changes. According to the report, 73 fleet service workers will be furloughed at the airport about 10 miles west of the city. Moreover, 18 employees who work at ticket counters or airport gates will also be among the cuts expected in March, GCTL8.com says. The cuts, the report notes, will leave Lodge 1044 of the International Association of Machinist and Aerospace Workers with about 80 members who still handle baggage and cargo, or clean and cater jets at the airport. About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). As of Sept. 30, 2010, US Airways had $8.006 billion in total assets, $3.049 billion in current liabilities, $4.883 billion in non-current liabilities, and $74 million in stockholders' equity. * * * US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: To Close Philippines Call Center by October ------------------------------------------------------- US Airways plans to close its Manila call center by October this year, reports thestreet.com. The report notes that US Airways opened the Philippines center as a temporary measure under a 2004 agreement, negotiated during its bankruptcy, with the Communications Workers of America, which represents its agents. "We agreed in 2004 that they could temporarily outsource this work," said CWA spokeswoman Candace Johnson in the report. "There were going to be layoffs and the company said there wouldn't be, in exchange for allowing this work to be done offshore." According to the report, US Airways brought back 600 reservations jobs from Manila, Mexico City and San Salvador to the U.S. in 2006. "Our reservations team does a much better job than those the work has been outsourced to," said US Airways CEO Doug Parker, in a May 2006 interview, notes the report. "Despite our efforts to improve the outsourcing, it will never be as good as having our own employees do it." Mr. Parker credited intensive cost-cutting for making it feasible to bring work back. About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). As of Sept. 30, 2010, US Airways had $8.006 billion in total assets, $3.049 billion in current liabilities, $4.883 billion in non-current liabilities, and $74 million in stockholders' equity. * * * US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. US AIRWAYS: Wants to Join United in Alliance -------------------------------------------- US Airways President Scott Kirby said the carrier has approached United about joining in a transatlantic joint venture with anti- trust immunity, Ted Reed of The Street reports. "If there's an opportunity to make it better by being part of a joint venture, we would like to do that," The Street quoted Mr. Kirby as saying at the carrier's fourth-quarter earnings call. "It's something we've had some conversations about with them." However, since United is working to implement a merger with Continental, including US Airways in the carriers' transatlantic joint venture "is not anything that's imminent" but "maybe . . . potentially down the road," Mr. Kirby added, notes the report. About US Airways US Airways -- http://www.usairways.com/-- along with US Airways Shuttle and US Airways Express, operates more than 3,000 flights per day and serves more than 190 communities in the U.S., Canada, Mexico, Europe, the Middle East, the Caribbean, Central and South America. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another Chapter 11 petition on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in their restructuring efforts. The USAir II bankruptcy plan became effective on September 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As of Sept. 30, 2010, US Airways had $8.006 billion in total assets, $3.049 billion in current liabilities, $4.883 billion in non-current liabilities, and $74 million in stockholders' equity. US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp. family rating and probability of default rating. Outlook is negative. US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer Credit rating and LT Local Issuer credit rating. Outlook is also negative. US Airways Group carries Fitch's "CCC" LT Issuer default rating and "C" Senior unsecured debt rating. Outlook is also negative. VILLAGE AT CAMP: Wants Plan Acceptance Period Extended to April 4 ----------------------------------------------------------------- Village at Camp Bowie I, L.P., asks the U.S. Bankruptcy Court for the Northern District of Texas to extend its exclusive right to obtain acceptances of its Chapter 11 Plan of Reorganization, up to and including April 4, 2011. The Debtor said Western Real Estate Equities, LLC, scheduled its "motion for valuation" on January 26, 2011, just 5 days prior to the Debtor's exclusive period to obtain confirmation of its Plan. As reported in the Troubled Company Reporter on February 3, 2011, Village at Camp Bowie I, L.P., has filed a proposed Plan and explanatory Disclosure Statement. Pursuant to the terms of the Plan, all creditors will be paid 100% of their Allowed Claims over time. Funds for those payments will be sourced from cash on hand plus $600,000 in preferred equity to be issued to participating Interest Holders of the Debtor or third party investors and from future revenue of the Reorganized Debtor. The Court has set a hearing for February 10, 2011 at 1:30 p.m. to consider the adequacy of the Disclosure Statement. About Village at Camp Dallas, Texas-based Village at Camp Bowie I, L.P., is the owner of a mixed use real estate development located in Forth Worth, Texas, on Camp Bowie Boulevard between Bryant Irvin Road an Ridglea Avenue, about 1/2 mile south of I-30 an known as the Village at Camp Bowie. The Debtor filed for Chapter 11 bankruptcy protection on August 2, 2010 (Bankr. N.D. Tex. Case No. 10-45097). J. Mark Chevallier, Esq., at McGuire, Craddock & Strother, P.C., in Dallas, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. W.R. GRACE: Garlock Document Request Facing Objections ------------------------------------------------------ Two groups of law firms oppose Garlock Sealing Technologies Inc.'s motion to access statements filed under Rule 2019 of the Federal Rules of Bankruptcy Procedures in 12 bankruptcy cases: -- Kazan, McClain, Lyons, Greenwood & Harley, Waters & Kraus LLP, Stanley, Mandel & Iola, L.L.P., Simmons Browder Gianaris Angelides & Barnerd LLC, Bergman, Draper & Frockt, Gori Julian & Associates, P.C., Early, Lucarelli, Sweeney & Strauss, Cooney & Conway, George & Sipes LLP, Lipsitz & Ponterio, LLC, Bifferato LLC, and Montgomery, McCracken, Walker & Rhoads, LLP; and -- The Law Offices of Peter G. Angelos, P.C., Baron & Budd, P.C., Brayton Purcell, LLP, Hissey Kientz, LLP, The Lipman Law Firm, Reaud, Morgan & Quinn, Inc., Thornton & Naumes, LLP, Waters & Kraus, LLP, and Williams Kherkher Hart Boundas, LLP. The Law Firms contend that seven of the 12 bankruptcy cases are already closed and Garlock's motion proposes a re-opening of those closed cases and intervening in all of the cases despite being neither a creditor nor cognizable party-in-interest. "As a mere bystander with no discernible stake in any of the bankruptcy cases, Garlock should not be permitted to re-open long closed cases or intervene in those that remain open," the Law Firms assert. 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) * Accommodating Markets Shrink Maturing Junk-Rated Debt ------------------------------------------------------- According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, Moody's Liquidity-Stress Index released Feb. 1 said that liquidity pressures on lower-tier junk-rated companies are the lowest since mid-2005. Moody's said the improvement comes from "high-yield markets" which "have welcomed even risky credits." One year ago, weaker credits in the class had $79 billion in debt maturing this year. Now, debt maturing in 2011 has been reduced to $26 billion, Moody's said. Although near-term debt maturities have been reduced, Moody's said that "total debt levels were not meaningfully reduced." Instead, the "companies merely 'kicked-the-can'" down the road, Moody's said. There is $130 billion of 'Caa1'-or-lower rated debt maturing in the next five years, Moody's said in a separate report. Companies in this category, Moody's said, "could face difficulties refinancing their debt if the leveraged finance market comes under stress." Looking ahead, Moody's said the "biggest liquidity risks today are the risk that the economic recovery turns south." * Canadian Business Bankruptcies at Record Low, CIBC World Says --------------------------------------------------------------- Business bankruptcies in Canada are at an all-time low, finds CIBC's latest Bankruptcy Report. Just over 3,500 firms declared bankruptcy during the first 10 months of 2010 -- 26% below the rate seen in the same period of last year, and less than half the average level of the past twenty years. The 3.4 bankruptcies per 1,000 businesses in 2010 was by far the lowest on record. "In some ways, Corporate Canada has never been stronger than it is right now," says Benjamin Tal, Deputy Chief Economist at CIBC. "Better-than-expected profitability and a reluctance to spend in recent years has left Canadian businesses sitting on a record amount of cash and confident about the future. Corporate Canada's decision to quickly downsize during the recent recession not only allowed it to withstand the downturn but has also allowed it to ramp up its hiring at a much faster clip than we've seen stateside." The recent revision of the employment data by Statistics Canada revealed that the country is 30,000 jobs short of the pre- recession peak. At the current rate of job creation it will take no more than a few months to completely close the gap. In the U.S., with the level of employment no less than 5.5% below the prerecession level, it will take 55 months to return to pre- recession levels at the current pace of job creation. Mr. Tal explains that despite the fact that both countries have already closed the GDP gap, Canada's notable outperformance in job creation has been driven in part by the different trajectories seen in the path of business bankruptcies in the two countries. "In the U.S. the number of business bankruptcies has risen at a rate not seen since the 1970s, but there has been no similar story here in Canada. "Not only is the number of business bankruptcies low, but it continues to fall at a rate not seen before. The 2008-2009 recession was the only downturn on record that saw the number of business bankruptcies in Canada drop and even now they are falling at a year-over-year rate of 30% - much faster than the pace seen in any other recovery. And despite the fact that today there are 30% more businesses in the Canadian economy than in the late 1980s, there are also 50 per cent fewer bankruptcies." The report notes that the ability of Canadian firms to stay in business during the recession was, in part, a result of some well- timed defensive steps taken by its business leaders. Unlike the situation in the U.S. or during other post-war recessions, Corporate Canada was able to tackle reduced demand and increased borrowing costs by more quickly rationing and downsizing - as opposed to waiting too long and being forced into plant closures. "In the earlier part of the recession, jobs in Canada were disappearing faster than in any other recession," adds Mr. Tal. "And most of these jobs were lost due to downsizing - not bankruptcies. This distinction is important since re-hiring by downsized but existing companies during the recovery occurs much faster than hiring by new firms. And that's exactly what we have witnessed during the current recovery with overall employment reaching pre-recession levels faster than in any other cycle." All provinces have seen the number of business bankruptcies fall over the year ending October 2010 - with British Columbia leading the way with an astonishing 43% fewer bankruptcies than during the same period in the previous year. Ontario, Manitoba and Saskatchewan also saw business bankruptcies decline more than the national average. Alberta saw the number of business bankruptcies fall by only nine per cent during this period - likely a lagged effect of the slowing activity in the energy sector. By industry, the improvement over the year ending October 2010 was relatively uniform with all industries seeing a notable decline in business failures. Change in Business Bankruptcies By Province Nov 09-Oct 10 vs. Nov 08-Oct 09 Alberta -8.9% Atlantic -17.6 Quebec -23.8 Canada -26.6 Man/Sask -27.7 Ontario -30.2 BC -43.4 The complete CIBC World Markets report is available at: http://research.cibcwm.com/economic_public/download/bkpty- 20110203.pdf * BOOK REVIEW: Leveraged Management Buyouts - Causes and Consequences -------------------------------------------------------- Edited by Yakov Amihud Beard Books, Washington, D.C. 2002 (reprint of 1989 book published by Dow Jones-Irwin) 268+xiii pages $34.95 trade paper, ISBN 1-58798-138-6 The twelve papers were first presented at a 1988 conference sponsored by the Salomon Brothers Center for the Study of Financial Institutions held at the New York University Leonard N. Stern School of Business. The papers by leading business figures were "intended to expand the understanding of the causes and consequences of leveraged management buyouts and to contribute to the debate on the appropriate public policy to be applied" [from the editor Mr. Amihud's Preface]. This aim involved the analyses of leveraged management buyouts [MBO] by businesspersons who had participated in such transactions, review of the latest academic research on the topic, and a critical look at the relevant regulatory proposals. The interest in policy -- i. e., government policy -- on MBO's is emphasized by the presence of the notable Edward J. Markey -- at the time the chairman of the Telecommunications and Finance Subcommitte of the U. S. House of Representatives -- to give a paper on "Legislative Views on Management Buyouts." The participaton of Joseph A. Grundfest of the Securities and Exchange Commission adds to this emphasis. Other participants are outstanding lawyers and professors in the fields of corporate finance and buyouts and one participant from Goldman, Sachs. When the conference was held and the book published shortly thereafter in the late 1980s, leveraged buyouts were occurring across the United States business landscape in "unprecedented levels, both in number and in size of transaction." One recalls that this was the latter years of the two Reagan presidential terms during which entrepreneurialism, deregulation, mergers and acquistions, and other practices for new kinds of business growth were officially encouraged. The Reagan policies created a new business environment. MBOs were a part of this. Resembling for the most part the leveraged buyouts (LBOs) which were occurring widely at the time, MBOs were distinguished within this activity in that "the incumbent management [of the firm being bought out] acquires a substantially greater proportion of the firms' equity than it previously had and the public firm is merged into the privately owned firm that usually continues to operate the acquired firm as an independent company." Oftentimes particular assets and sometimes whole divisions of the acquired firm are sold off. The firm acquiring a company is "normally a group of investors [who formed] a shell holding corporation, whose equity is privately held." Such investors would have a great deal more latitude in making acquisitions and in selling off parts of an acquired company than in typical mergers-and-acquisitions between companies for the purposes of symbiosis or efficiencies in operations for example. The managers of a company more or less take this position toward their company in a leveraged management buyout. The concerns and questions raised especially by leveraged management buyouts in the late 1980s are the same ones as today. Then as now, MBOs "inspire the question of fairness and the question of whether this form of restructuring has real economic benefits." The papers try to answer these questions though no definitive answers can be given since questions of fairness and economic benefits raise further questions about fairness and benefits for whom; and also business conditions are continually changing leading to new perspectives and assessments of leveraged management buyouts. The severe United States' recession with global repercussions starting in 2008 once again raises such ethical and economic questions. The closing words of Roberta Romano of the Yale Law School in her paper "Management Buyout Puzzles" still apply: "Although we have learned a great deal about MBOs, in my estimation, we are still groping in the dark." As in many matters, there are no permanent answers or positions. Some MBOs are right and beneficial, while others are wrong and harmful. The learned papers of this collection help readers weigh which MBOs are which type. Yakov Amihud is the Ira Leon Rennett Professor of Entrepenurial Finance at the NYU Stern School of Business who has written on corporate finance, mergers and acquisitions, and securities' trading. ********* 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 ***