/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110214.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, February 14, 2011, Vol. 15, No. 44 Headlines 1976 DORCHESTER: Case Summary & Largest Unsecured Creditor 4415 EAST: Voluntary Chapter 11 Case Summary ACORN ELSTON: Receiver Gets OK to Access Cash Collateral ACORN ELSTON: Has Until March 10 to File Reorganization Plan AGE REFINING: Ch. 11 Trustee to Auction Off Assets in March ANGIOTECH PHARMACEUTICALS: Has Deal for $28-Mil. DIP Loans APEX DIGITAL: Has Until March 15 to Propose Reorganization Plan AREMISSOFT CORP: Bank of Cyprus' Bid to Take Evidence Denied ARLIE & COMPANY: Plan Confirmation Hearing Scheduled for April 4 ASARCO LLC: Asarco & SCC Merger Still Underway ASARCO LLC: Sues Potentially Responsible Parties in Missouri ASARCO LLC: V. Karl Wants Lift Stay for Prepetition Suits AZUKA FOODS: Case Summary & 17 Largest Unsecured Creditors BADGER STATE BANK: Closed; Royal Bank Assumes All Deposits BELTWAY 8: Full Payment Demand Prompted Chapter 11 Filing BERNARD L MADOFF: Bankr. Ct. Stays 3rd Party Suits vs. Madoff Kin BERNARD L MADOFF: Ex-NY Gov. Cuomo to Mediate Mets Issue BLOCKBUSTER INC: Has Approval for Deloitte as Valuation Advisor BLOCKBUSTER INC: M. Rudd Insists on Request for Equity Committee BLOCKBUSTER INC: Wins OK for PricewaterhouseCoopers as Auditors BORDERS GROUP: Bankruptcy Filing Seen Monday or Tuesday, WSJ Says BOSQUE POWER: Senior Lenders' Plan Becomes Effective BOSTON GENERATING: Appeals Court Won't Reverse Constellation Sale BRISAM COVINA: Has Until March 17 to Propose Chapter 11 Plan BRISAM COVINA: Can Continue Using Cash Collateral Until Feb. 18 CALIFORNIA COASTAL: Aims to Terminate Underfunded Pension Plan CALIFORNIA COASTAL: Plan Confirmation Hearing Set for February 16 CANYON NAT'L BANK: Closed; Pacific Premier Bank Assumes Deposits CARLTON GLOBAL: Files Schedules of Assets and Liabilities CATHOLIC CHURCH: CMRSA Wants Fairbanks Trustee Objection Denied CATHOLIC CHURCH: Milwaukee Committee Taps Pachulski as Counsel CATHOLIC CHURCH: Milwaukee Panel Taps Howard as Local Counsel CCT COMMUNICATIONS: Shareholder's Bid for Fee Examiner Denied CDC PROPERTIES: Case Summary & 4 Largest Unsecured Creditors CDX GAS: Court Closes Chapter 11 Reorganization Case CHOA VISION: Can Continue Using Cash Collateral Until March 31 CLOVERLEAF ENTERPRISES: Balks at Opposes Landow's Late $12MM Offer COLTS RUN: Court to Consider Trustee Appointment on Feb. 17 COMPUTER SYSTEMS: Court to Dismiss Chapter 11 Case CONSOLIDATED HORTICULTURE: To File Plan After Assets Sale COYOTES HOCKEY: Glendale Plans Bond Sale This Week to Fund Sale EMMIS COMMUNICATIONS: Alden Seeks to Void $200,000 Loan to CEO EVERGREEN ENERGY: Edgehill Partners Discloses 8.3% Equity Stake EVERGREEN SOLAR: Debt Exchange Offer Expired Friday FIRST METALS: Noteholders OK Sale of Fabie & Magusi Properties FRED NEAL: Barred From Filing Bogus Debt Instruments GAS CITY: Seeks May 24 Extension of Exclusive Plan Filing Period GENERAL MOTORS: Claims Settlement Total $51.1 Mil. in 4th Quarter GENERAL MOTORS: Opposes TP Lenders Plea for Valuation Hearing GENERAL MOTORS: To Expand Financial Unit's Operations GENERAL MOTORS: Wins Nod of Stipulation Allowing LDTC Claims GLAZIER GROUP: Committee Taps SilvermanAcampora LLP as Counsel GLAZIER GROUP: Court Approves Herrick Feinstein as Bankr. Counsel GLOBAL GENERAL: Recognition Hearing Scheduled for March 4, 2011 GLOBAL SHIP: Pine River Equity Stake Down to 0.1% GREEN VALLEY: Creditors' Lawyer Can Represent Ch. 11 Trustee GREENWICH SENTRY: Files Schedules of Assets and Liabilities GSI GROUP: Robert Buckley to Become Chief Financial Officer HANMI FINANCIAL: BlackRock Discloses 5.70% Equity Stake HERCULES OFFSHORE: BlackRock Holds 6.23% Equity Stake HOLLIFIELD RANCHES: Has Access to Cash Collateral Until Dec. 28 INNOVATIVE COMM: Virgin Islands Ct. Rules on Asset Turnover Suit INTERNATIONAL COAL: Steelhead Partners Has 5.8% Equity Stake INTERNATIONAL COAL: BlackRock Discloses 5.64% Equity Stake JEFFREY PROSSER: Virgin Islands Ct. Rules on Asset Turnover Suit JH REALTY: Can't Use MetroBank's Cash Collateral KENTUCKIANA MEDICAL: Head Doctors Sued for Ch. 11 Filing LACK'S STORES: Court Approves Platzer Swergold as Panel's Counsel LACK'S STORES: Court Okays Strong Pipkin as Panel's Local Counsel LACK'S STORES: Texas Comptroller Asks $7.4MM from Sale Proceeds LEVITT AND SONS: BFC Financial Offers $30,000 for Tradenames LEXI DEVELOPMENT: Wants Plan Outline Hearing Continued to March 13 LEXI DEV'T: Has Interim OK to Use Lexi North Bay's Cash Collateral LOCAL INSIGHT: Directory Distributing Resigns from Committee LOCAL INSIGHT: Proposes April 4, 2011 Claims Bar Date MAGIC BRANDS: Court Formally Approves Sale to Luby's Inc. MAGNA ENTERTAINMENT: Court Sides With PA Meadows in Contract Row MAGNA ENTERTAINMENT: Loses $10-Million Suit Against PA Meadows MARANA HOSPITALITY, LLC: Case Summary & Creditors List MARANA HOSPITALITY II: Case Summary & Creditors List MARANA MAIN: Case Summary & 2 Largest Unsecured Creditors MAYSVILLE INC: Court Dismisses Chapter 11 Case MESA AIR: Court Enters Post-Confirmation Order MESA AIR: Court Okays Delta Air Claims Settlement MESA AIR: Reaches Plan Settlement With BF Claims Holdings MOMENTIVE SPECIALTY: Completes Sale of IAR Business to Harima MONEYGRAM INT'L: Reports $16.16MM Net Income in Fourth Quarter MONTECITO AT MIRABEL: Dismissal Motion Set for Hearing March 29 MORGANS HOTEL: Massachusetts Financial Holds 7.2% Equity Stake MPG TRUST: Edward J. Ratinoff Does Not Own Any Securities MTR LEASING: Files Schedules of Assets and Liabilities MYPHOTOPIPE.COM: Files for Chapter 11 Protection NATIONAL HOME: Objects to Committee's Plan; Hearing Set for Feb 23 NCOAT INC: Wants to Extend Plan Filing Deadline to May 14 NEOMEDIA TECHNOLOGIES: Andypolo Discloses 9.9% Equity Stake NEOMEDIA TECHNOLOGIES: YA Global Discloses 9.9% Equity Stake NEW STREAM: 3 Law Firms Represent Investors Opposing Ch. 11 Plan NORTEL NETWORKS: Employees Challenge $38-Millon Deferred-Pay Grab NOVADEL PHARMA: Amends Form S-1; To Sell 40MM Common Shares NOVADEL PHARMA: Zolpimist Oral Spray Launched in U.S. NOVASTAR FINANCIAL: Barry Igdaloff Discloses 10.3% Equity Stake NOVELOS THERAPEUTICS: Deregisters 15.60 Million Common Shares OMNICOMM SYSTEMS: G. van Kesteren Discloses 5.7% Equity Stake PATIENT SAFETY: COO Hamilton Resigns for Personal Reasons PEANUT CORP: Salmonella Victims Seek Criminal Case for Ex-Head PEOPLES STATE BANK: Closed; First Michigan Bank Assumes Deposits PILGRIM'S PRIDE: Injured Worker May Pursue Claim in District Court QUEENS PLAZA: Liquidating Plan Confirmed; Feb. 17 Auction Set RADIENT PHARMACEUTICALS: Unit Closes $900,000 Bridge Financing RAYMOND PROFESSIONAL: Dist. Court Affirms Ruling in Pope Suit RDK TRUCK: Asks for Court's Permission to Use Cash Collateral REALOGY CORP: Completes Offering of $700MM Sr. Secured Notes RIVER EAST: Case Summary & 20 Largest Unsecured Creditors ROSELAND VILLAGE: Files List of Five Largest Unsecured Creditors ROSELAND VILLAGE: Files Schedules of Assets and Liabilities SCI REAL ESTATE: Case Summary & 20 Largest Unsecured Creditors SECURED CALIFORNIA: Case Summary & 20 Largest Unsecured Creditors SEA LAUNCH: Boeing Still Pursuing $356 Million Claim SEAHAWK DRILLING: Files for Chapter 11 for Quick Sale to Hercules SEAHAWK DRILLING: Case Summary & 30 Largest Unsecured Creditors S.H. LEGGITT: Confirmation Objections Due by March 11, 2011 SHALAN ENTERPRISES: Hearing on Perry Klein's Plan Moved to March 9 SHELBRAN INVESTMENTS: U.S. Trustee Unable to Form Creditor's Panel SILVERVIEW, LLC: Voluntary Chapter 11 Case Summary SONOMA VINEYARD: Geneva Leasing Has Lift Stay to Foreclose STANT PARENT: Chapter 11 Plan Declared Effective December 31 SUMMIT BUSINESS: Section 341(a) Meeting Set for March 9 SUMMIT BUSINESS: Taps Garden City as Claims Agent SUMMIT BUSINESS: U.S. Trustee Unable to Form Creditor's Committee SUNSHINE STATE COMMUNITY: Closed; Premier American Takes Deposits SUNWEST MANAGEMENT: Settles With Merrill Over $2.2 Million Claim SYNTERRA 3020: Section 341(A) Meeting Set for February 24 TALON THERAPEUTICS: James E. Flynn Discloses 38.49% Equity Stake THINKFILM LLC: Three Other Companies Declared Bankrupt TODD M ENRIGHT: Spouse's Lawyer in Divorce Case Can File Claim TREVOR DAVIS: Zimco Holdings Condo Sales to Move Forward TRIBUNE CO: Only Noteholders Didn't Vote for Mgt. Plan TRIBUNE CO: Amends Plan to Add King Street Settlement TRIBUNE CO: Aurelius, et al., File Supplements to Proposed Plan TRIBUNE CO: Bridge Lender Group Withdraws Proposed Plan TRICO MARINE: DIP Lenders Cry Default, Defend Sale Plea TSO INC: Files List of 20 Largest Unsecured Creditors TSO INC: Files Schedules of Assets and Liabilities TWIN CITY: Wants to Extend Plan Filing Deadline to May 12 UNIGENE LABORATORIES: To Sell Property to RCP Birch for $1.2MM VENTO FAMILY: Taps Timothy Cory Associates as Counsel VENTO FAMILY: Files Schedules of Assets and Liabilities WASHINGTON MUTUAL: Judge Says Shareholder Appeal Untimely WHITEHALL AVENUE: Meeting of Creditors Set for Feb. 28 WIKILOAN INC: Founder Returns Close to 10MM Shares to Treasury WINGATE AIRPORT: Case Summary & 3 Largest Unsecured Creditors WJO INC: Committee Taps Keifer & Tsarouhis as Counsel WJO INC: U.S. Trustee Forms Three-Member Creditor's Committee WJO INC: U.S. Trustee Wants Case Converted to Chapter 7 W.R. GRACE: District Court Sets Status Conference for Feb. 16 W.R. GRACE: Reports Fourth Quarter 2010 Financial Results W.R. GRACE: Seeks Clarification of Plan Confirmation Order YORK SQUARE: Case Summary & 20 Largest Unsecured Creditors YRC WORLDWIDE: Incurs $322 Million Net Loss in 2010 * SecondMarket Says Bankruptcy Claims Trading Rose 400% in 2010 * TMA Poll: Most Turnaround Pros Say "No" to State Bankruptcies * Michigan Municipalities, School Districts Could Face Insolvency * Missouri's Second Injury Fund Nearing Insolvency, Koster Warns * 4 Banks Shuttered Friday; Year's Failures Now 18 * S&P: Global Corporate Default Tally Remains at 2 in 2011 * Obama Gov't Outlines Steps to Phase Out Fannie and Freddie * BOND PRICING -- For Week From February 7 to 11, 2011 ******** 1976 DORCHESTER: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Debtor: The 1976 Dorchester Trust 9595 Wilshire Boulevard, Suite 510 Beverly Hills, CA 90210 Bankruptcy Case No.: 11-15647 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Alan M. Ahart Debtor's Counsel: Catherine Christiansen, Esq. CHRISTIANSEN LAW OFFICES 1077 Pacific Coast Highway, Suite 210 Seal Beach, CA 90740 Tel: (562) 608-8368 Fax: (562) 493-9478 E-mail: christiansenlaw@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Mark Anderson, trustee. The list of unsecured creditors filed together with its petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bank of America Bank Loan $2,300,000 P.O. Box 10221 Van Nuys, CA 91410 4415 EAST: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: 4415 East Grant Road, L.L.C. 4572 E. Camp Lowell Drive Tucson, AZ 85712 Bankruptcy Case No.: 11-03219 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: James M. Marlar Debtor's Counsel: Michael W. McGrath, Esq. MESCH CLARK & ROTHSCHILD 259 North Meyer Avenue Tucson, AZ 85701-1090 Tel: (520) 624-8886 Fax: (520) 798-1037 E-mail: ecfbk@mcrazlaw.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 M. Chris Monson of Aberdeen Group, LLC, managing member. ACORN ELSTON: Receiver Gets OK to Access Cash Collateral -------------------------------------------------------- The Hon. Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York authorized the receiver for Acorn Elston, LLC's assets to access the cash securing debt to Road Bay Investments, LLC, as successor-in-interest to Allstate Life Insurance Company. C. Michelle Panovich, the appointed receiver with respect to the Elston Plaza Shopping Center, and its rents, income and proceeds, would have access to cash collateral until Feb. 28, 2011, according to the Court's order. The receiver will use the cash collateral to manage, operate, maintain and preserve Elston Plaza and conduct the business operations related thereto. The cash Collateral is also necessary to fund the "Chipotle Lease Expense." The Letter of Intent of Chipotle Mexican Grill, Inc., contemplates that the Debtor would fund (a) $200,000 to Chipotle as a tenant improvement allowance to subsidize the cost to be incurred by Chipotle in fitting out the lease space and (b) a brokerage commission in the approximate amount of $35,822. In addition, the receiver will incur legal fees and related closing costs in connection with the negotiation and consummation of the Proposed Chipotle Lease. The Debtor anticipates that the tenant improvement allowance, the brokerage fee and the related legal fees and closing costs will aggregate approximately $250,000. Road Bay contends that, as of the Petition Date, it iw oed by te Debotr $18.0 million pursuant to a $15 million Mortgage Note, dated April 19, 2007. The obligations of the Debtor under the Note are guaranteed by John B. Coleman, the sole member of the Debtor. As adequate protection for any diminution in value of Road Bay's collateral, the Debtor will grant the lender perfected postpetition security interests and superpriority administrative claim status, subject to carveout. As further adequate protection, the receiver will provide adequate protection payments to the lender in the form of (i) monthly payments (calculated at the non-default contract rate of 5.93% on a principal sum of $15.9 million) in the amount of $78,700. About Acorn Elston Acorn Elston, LLC, owns the real property, together with the improvements situated thereon, known as Elston Plaza Shopping Center, a grocery-anchored retail shopping center in Chicago, Illinois. The Company filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-14807) on September 11, 2010. Lawrence F. Morrison, Esq., and Kasowitz, Benson, Torres & Friedman LLP, represent the Debtor in its restructuring effort. The Debtor disclosed $21.92 million in assets and $16.49 million in liabilities as of the Chapter 11 filing. The U.S. Trustee has not yet appointed an official committee of unsecured creditors in the Chapter 11 Case. On May 15, 2009, the Court appointed C. Michelle Panovich as receiver with respect to lender Road Bay Investments, LLC's prepetition collateral. ACORN ELSTON: Has Until March 10 to File Reorganization Plan ------------------------------------------------------------ The Hon. Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York extended Acorn Elston, LLC's exclusive periods to file and solicit acceptances for a proposed chapter 11 plan until March 10, 2011, and May 9, respectively. About Acorn Elston Acorn Elston, LLC, owns the real property, together with the improvements situated thereon, known as Elston Plaza Shopping Center, a grocery-anchored retail shopping center in Chicago, Illinois. The Company filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-14807) on September 11, 2010. Lawrence F. Morrison, Esq., and Kasowitz, Benson, Torres & Friedman LLP, represent the Debtor in its restructuring effort. The Debtor disclosed $21.92 million in assets and $16.49 million in liabilities as of the Chapter 11 filing. The U.S. Trustee has not yet appointed an official committee of unsecured creditors in the Chapter 11 Case. On May 15, 2009, the Court appointed C. Michelle Panovich as receiver with respect to lender Road Bay Investments, LLC's prepetition collateral. AGE REFINING: Ch. 11 Trustee to Auction Off Assets in March ----------------------------------------------------------- Vicki Vaughan at the San Antonio Express-News reports that AGE Refining Inc.'s oil refinery in San Antonio, Texas, is to be sold at an auction tentatively planned for March 8, 2011. At present, there are five bidders for the plant at 7811 S. Presa St. supplies jet fuel to local Air Force bases. "We're very pleased with the level of interest we've seen in the business," Express-News quotes Eric Moeller, the court-appointed bankruptcy trustee, as saying. Mr. Moeller, though, did not identify the five bidders. About Age Refining Age Refining, Inc., based in San Antonio, Texas, manufactures, refines and markets jet fuels, diesel products, solvents and other highly specialized fuels. The Company's clients cover a variety of sectors, including commercial, local municipalities and the federal government. Founded in 1991 by Al Gonzalez, AGE is a family owned and operated business in the heart of the San Antonio community. Starting on a shoe-string budget and a bushel of determination, AGE is proud to have posted over 22% growth per year since 1991. The Company filed for Chapter 11 bankruptcy protection (Bankr. W.D. Texas Case No. 10-50501) on Feb. 8, 2010. Aaron Michael Kaufman, Esq.; Carol E. Jendrzey, Esq.; and Mark E. Andrews, Esq., at Cox Smith Matthews Incorporated, represent the Chapter 11 Debtor. The Company estimated $10 million to $50 million in assets and $100 million to $500 million in liabilities in its bankruptcy petition. Eric Moeller has been named chapter 11 trustee to take management of the Debtor from Chief Executive Glen Gonzalez. In November 2010, the trustee filed suit against Mr. Gonzalez, alleging he breached his fiduciary duty by dipping into Company coffers for his personal use while paying himself an excessive salary and stock distributions, according to My San Antonio. ANGIOTECH PHARMACEUTICALS: Has Deal for $28-Mil. DIP Loans ---------------------------------------------------------- Angiotech Pharmaceuticals, Inc. disclosed that the Company and certain of its subsidiaries have entered into a definitive agreement with Wells Fargo Capital Finance LLC in respect of the previously announced debtor-in-possession credit facility. The DIP Facility will provide liquidity for working capital, general corporate purposes and expenses while the Company implements its previously announced recapitalization proceedings under the Companies' Creditors Arrangement Act (Canada). The DIP Facility provides for the lenders to make revolving credit loans and provide letters of credit in an aggregate principal amount (including the face amount of any letters of credit) of up to $28.0 million, which will become available to the Company once it has obtained a recognition order from the Supreme Court of British Columbia. The DIP Facility will be repaid and terminated in connection with the closing of the CCAA Recapitalization. About Angiotech Pharmaceuticals Based in Vancouver, British Columbia, in Canada, Angiotech Pharmaceuticals, Inc. (TSX: ANP) -- http://www.angiotech.com/-- is a global specialty pharmaceutical and medical device company. Angiotech discovers, develops and markets innovative treatment solutions for diseases or complications associated with medical device implants, surgical interventions and acute injury. Alvarez & Marsal Canada Inc., as monitor and foreign representative, filed Chapter 15 petitions for Angiotech Pharmaceuticals Inc. and its units (Bankr. D. Del. Lead Case No. 11-10269) on Jan. 30, 2011, to seek recognition of their insolvency proceedings under the Companies' Creditors Arrangement Act in Canada as a "foreign main proceeding" under 11 U.S.C. Sec. 1517. The Company's balance sheet at Sept. 30, 2010, showed US$326.80 million in total assets, US$60.30 million in current liabilities, and US$622.16 million in non-current liabilities and a stockholders' deficit of US$355.67 million. The foreign representative has tapped Mary Caloway, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, and Ken Coleman, Esq., at Allen & Overly LLP, in New York, as counsel in the Chapter 15 case. John Grieve, Esq., at Fasken Martineau DuMoulin LLP, in Vancouver, B.C., represents A&M in the CCAA case. APEX DIGITAL: Has Until March 15 to Propose Reorganization Plan --------------------------------------------------------------- The Hon. Peter H. Carroll of the U.S. Bankruptcy Judge for the Central District of California ordered that Apex Digital, Inc.'s exclusive periods to file and solicit acceptances for a proposed Chapter 11 plan is extended until March 15, 2011, and May 14, 2011, respectively. In its request for an extension, the Debtor related that it needs additional time to formulate a plan as it is currently focusing its efforts on providing Kith Consumer Product, Inc., among other things, business and product development services and customer service and warranty services for certain consumer electronic products as contemplated in a Consulting, Sale and Settlement Agreement dated as of August 17, 2010. The transactions contemplated by the Sale and Settlement Agreement, will result in: -- the debt owed to Kith Electronics reduced to $1.5 million, with the residual claim to remain subject to Kith Electronics' existing security interest and lien in its collateral, to the same priority, force and effect as Kith Electronics' security interest and lien existing prepetition in the collateral; and -- the Debtor to continue utilizing and monetizing its pipeline connections as a consultant, notwithstanding its inability to continue operating the Television Business. In addition, the Debtor says it needed time to finalize the proofs of claim and interest in the Debtor's case so that it may ascertain the total amount, number and types of claims and interests asserted against the Debtor's estate. About Apex Digital Walnut, California-based Apex Digital, Inc. -- aka AW XEPA Technologies Inc., AW Apex R&D Shangai, AW Apex, AW E2Go, AW Entertainment to Go -- is a privately held company that provides and markets consumer electronics, including high-definition LCD televisions, home entertainment media devices, solar powered lights and digital set top boxes. Apex Digital filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 10-44406) on August 17, 2010. Juliet Y. Oh, Esq., in Los Angeles, California, represents the Debtor. The Debtor estimated assets and debts at $10 million to $50 million as of the Petition Date. AREMISSOFT CORP: Bank of Cyprus' Bid to Take Evidence Denied ------------------------------------------------------------ Joseph P. LaSala and Fred S. Zeidman, as co-trustees of the AremisSoft Liquidating Trust, sued Bank of Cyprus in 2006 (S.D.N.Y. Case No. 06-cv-6673), alleging that the Bank allowed Lycourgos Kyprianou, the founder of AremisSoft, to loot the Company and launder the proceeds of his fraud using Bank of Cyprus accounts. On August 15, 2007, Judge Charles S. Haight dismissed the Trustees' lawsuit on forum non conveniens grounds in favor of Cyprus. However, Judge Haight specified that the forum non conveniens "dismissal is conditioned upon the defendant Bank of Cyprus appearing and defending on the merits, without interposing a statute of limitations, an action asserting claims arising out of these facts, by the plaintiff Trustees in the courts of Cyprus, failing which plaintiffs may apply to restore the case to this Court's calendar." In October 2010, the Trustees filed an action against Bank of Cyprus in Cyprus asserting essentially the same claims as those Judge Haight dismissed. Throughout the course of the S.D.N.Y. action, the Trust was also pursuing claims against Mr. Kyprianou in Cyprus. In 2010, the Trust entered into an agreement with Mr. Kyprianou, settling its claims in exchange for his cooperation against three banks, including Bank of Cyprus. In conjunction with this settlement, the Trustees sought leave from the New Jersey bankruptcy court to engage Mr. Kyrprianou's personal attorney in Cyprus, Georgios Seraphim, on a contingency basis as special counsel to the Trust. On December 30, 2010, Bank of Cyprus filed an application to take evidence pursuant to 28 U.S.C. Sec. 1782, seeking to subpoena Greenberg Traurig, which represents the Trustees in the United States. Bank of Cyprus also filed an ex parte application to take evidence in the District of New Jersey to depose the Trustee. The Bank explains that it filed two applications seeking the same documents because it is unclear whether the documents are in the Trustees' or Greenberg Traurig's possession. Greenberg Traurig opposed the application. The ex parte application filed in the District of New Jersey was granted. Meanwhile, Greenberg Traurig contends that Bank of Cyprus has not fulfilled Judge Haight's condition that the Bank defend the lawsuit on the merits in Cyprus, and therefore requests that Judge Haight's case be resorted to the S.D.N.Y. calendar. District Judge John F. Keenan ruled that, subject to Greenberg Traurig's stipulation regarding document production, Bank of Cyprus' application to take evidence is denied. Judge Keenan also denied Greenberg Traurig's cross-motion to restore Case No. 06 Civ. 6673 to the Court's docket, without prejudice, so the parties may address the matter to Judge Haight. According to Judge Keenan, it does not appear that Greenberg Traurig, which was not a party to the lawsuit against Bank of Cyprus in the district, has standing to make such a motion. Moreover, Judge Keenan believes that Greenbeg Traurig's request is more properly brought before the judge who handled and dismissed case. Judge Haight is familiar with the story and facts of the case, and he is in the best position to determine whether Bank of Cyprus satisfied his mandate. A copy of Judge Keenan's January 21, 2011 Memorandum Opinion and Order at http://is.gd/HHEKJsfrom Leagle.com. About AremisSoft Corp. Based in Minneapolis, Minnesota, AremisSoft Corporation -- http://www.aremissoft.com/-- developed enterprise resource planning (ERP) software for midsized companies in the manufacturing (35% of sales), health care, hospitality, and construction industries. Its ERP applications automate and manage such processes as accounting, customer service, and sales and marketing for BAE SYSTEMS, Regal Hotel International, Ericsson, and other customers. The company filed for chapter 11 protection on March 15, 2002 (Bankr. D. N.J. Case No. 02-32621). Paul R. DeFilippo, Esq., at Gibbons, DelDeo, Dolan, Griffinger et al., represented the Debtor in its restructuring efforts. The Court confirmed the Debtor's Chapter 11 plan in June 2002, and the plan took effect in August 2002. Among others, the plan called for a creation of a litigation and liquidating trust. George Ellis, chairman and CEO of SoftBrands, was brought in to lead the restructuring effort. ARLIE & COMPANY: Plan Confirmation Hearing Scheduled for April 4 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Oregon will convene a combined hearing on April 4, 2011, at 10:00 a.m., to consider adequacy of Arlie & Company's Disclosure Statement and confirmation of the proposed Plan of Reorganization. Any objections to the Plan, and ballots accepting or rejecting the Plan are due seven days before the hearing date. A summary of ballots is due three business days prior to the hearing date. The Debtor's Disclosure Statement was conditionally approved by the Court, subject to the consideration of objections. As reported in the Troubled Company Reporter on January 17, 2011, the Debtor's Plan provides for, among other things: -- auctioning off its 5,226-acre West Hilo Tree Farm in Hawaii to raise cash to fund its Chapter 11 bankruptcy reorganization; -- the Debtor will turn back the title to the former U.S. Bureau of Land Management headquarters on Chad Drive, in Eugene, Oregon, which the Company bought for $5.1 million two years ago from a half-dozen individual investors. -- involves reducing the amount of secured debt the Company owes to Bank of America. About Arlie & Company Eugene, Oregon-based Arlie & Company -- http://www.arlie.com/-- is a property developer. It is doing business as DHF Corp., and formerly dba Arlie Land and Cattle Company and Crescent Village Community Gardens, LLC. The Company filed for Chapter 11 bankruptcy protection on January 20, 2010 (Bankr. D. Ore. Case No. 10-60244). Pachulski Stang Ziehl & Jones LLP, and Ball Janik LLP, serve as the Debtor's bankruptcy counsel. The Company disclosed $227,191,924 in assets and $65,412,220 in liabilities as of the Chapter 11 filing. ASARCO LLC: Asarco & SCC Merger Still Underway ---------------------------------------------- Reorganized ASARCO LLC reported sales of $476,317,000 in the fourth quarter of 2010, according to the results released by its parent, Grupo Mexico, S.A.B. De C.V. The amount increased by 28.4% over the same period in 2009, which is attributable to greater copper production and improved metals prices. Cumulative sales for 2010 were $1.7037 billion, which is 46.2% more than in 2009. The cost of sales for the fourth quarter was $203.7 million, which is 15% less than the $239.7 million of the same quarter last year, mainly as there is no effect of the inventory reevaluation conducted after December 10, 2009, when ASARCO was reincorporated into Grupo Mexico. EBITDA in the current quarter was $272.9 million, which is equivalent to 57.3% of sales, and representing a growth of 93.8% compared to the same quarter last year. EBITDA for 2010 amounted to $817.9 million. Capital expenditures in the fourth quarter were $26.5 million, which is mainly attributable to the payment of four new 400-ton Liebbher trucks, which were received and put into operation in the third quarter of 2010 for the Ray mine. ASARCO's copper production in the fourth quarter was 53,712 tons, which represents an increase of 16% over the same quarter of 2009. Copper production in 2010 was 209,453 tons, which is 13% more than the 185,894 tons produced in 2009. The increase mainly stems from an improved ore grade at the Mission and Ray mines, and also improved recovery at Ray mine. ASARCO to Produce 200k Tons of Copper Grupo Mexico's copper production for 2011 is expected to be 830,000 tons, of which 630,000 tons will be produced by Southern Copper Corporation mines and 200,000 tons by ASARCO mines. According to Reuters, studies are underway to boost output in ASARCO by 45% to 290,000 tons per year by 2015. "We are very happy with the way Asarco is performing, and we only see good things here," Reuters quoted Daniel Muniz as saying. Mr. Muniz is Grupo Mexico's chief financial officer. ASARCO and SCC Merger The special committee of independent directors, formed August 10, 2010, by Southern Copper Corporation, continues to evaluate the proposal by Americas Mining Corporation to combine, on behalf of the public stockholders, SCC and ASARCO. The special committee has retained the services of a mining advisor to assist with this transaction and help the special committee with the evaluation of the proposal. Grupo Mexico believes that the combination of SCC and ASARCO will provide important synergies, including reductions in operating, transportation, and overhead, and capital expenditure savings, which would benefit all shareholders of the combined entity. With the proposed merger, mines in Peru could process material in ASARCO's Texas refinery, Mr. Muniz says. An SCC shareholder has opposed the deal saying it would devalue the stock, Reuters reports. "We do think that there is value for everyone including the minority shareholders if we combined the operations and I think the market agrees with me on that," Mr. Muniz is quoted by Reuters as saying. The Reuters report also says that the merged companies will produce 830,000 tonnes of copper in 2011. Mr. Muniz, however, notes that there is no strict time frame for the deal. "But if things evolve as they have, due diligence is almost over . . . this should be done by the first half of 2011," Mr. Muniz says. Reduction of Operating Cost ASARCO continued to reduce its operating cost, down from $1.58 per pound in 2009 to $1.50 per pound in 2010. The improvement reflects greater productivity and operating efficiency, and also greater contributions from byproducts. Capital Expenditures The Board of Directors of Grupo Mexico reviewed its capital program, approving a capital budget of $1.907 billion for 2011. Grupo Mexico intends to allocate $881 million for projects in Mexico, $862 million for projects in Peru, and $164 million for ASARCO's operations in the United States of America. The program considers the potential of the reserves and is an important part of Grupo Mexico's five-year capital program, which aims to significantly increase the production capacity of both copper and molybdenum. The capital program for 2011 includes $524 million for the Buenavista expansion in Mexico, $324 million for the Tia Maria project, and $271 million for the Toquepala expansion in Peru. Copper Hedging For 2011, ASARCO has hedged 45% of its copper production through swaps at an average price of $3.77 and 50% of its production through zero-cost collars with an average floor price of US $3.00 per pound and an average cap price of US $4.53 per pound. For 2012, ASARCO has hedged 6% of its copper production through zero-cost collars with an average floor price of $3.50 per pound and an average cap price of $5.03 per pound. Best Loan Award LatinFinance awarded the Best Syndicated Loan 2010 Award to AMC's syndicated loan for $1.5 billion, which was secured for the successful reorganization of ASARCO. The award recognizes the amount and complexity of the operation -- multi-currency and multi-tranche -- given the uncertainty in the markets, lack of liquidity in the financial system, and the complexity of the loan structure. ASARCO LLC Consolidated Balance Sheet As of December 31, 2010 ASSETS Current Assets: Cash and cash equivalents $38,338,000 Restricted Cash 139,079,000 Notes and accounts receivable 125,052,000 Inventories 358,097,000 Prepaid and other current assets 562,020,000 --------------- Total Current Assets 1,222,586,000 Property, plant and equipment, net 1,405,682,000 Leachable material, net 83,946,000 Other long term assets 1,003,722,000 --------------- Total assets $3,715,937,000 =============== LIABILITIES AND STOCKHOLDERS' EQUITY Long term debt - Other non-current liabilities $442,506,000 Environmental remediation obligations, current 8,123,000 --------------- 450,629,000 Current liabilities: Other long term liabilities 620,050,000 --------------- Total Current Liabilities 620,050,000 --------------- Total liabilities 1,070,679,000 Stockholders equity 2,352,524,000 Other equity accounts (171,068,000) Retained earnings 383,724,000 --------------- Total stockholders' equity 2,565,180,000 Non-controlling interest 80,079,000 --------------- Total liabilities and stockholders' equity $3,715,937,000 =============== ASARCO LLC Consolidated Statement of Earnings Quarter Ended December 31, 2010 Net Sales $476,317,000 Cost of sales 201,378,000 Exploration 2,415,000 --------------- Gross profit 272,524,000 Gross margin 57% Administrative expenses 1,782,000 EBITDA 272,906,000 Depreciation & amortization 95,925,000 --------------- Operating income 174,817,000 Operating margin 37% Interest expense 286,000 Interest income (1,648,000) Financial coverage 18,849,000 Other (income) expense, net (2,163,000) --------------- Earnings before taxes 159,493,000 Taxes 12,339,000 --------------- Net Earnings 147,154,000 Non controlling interest in consolidated subsidiaries 7,263,000 --------------- Consolidated Net Earnings $139,891,000 =============== ASARCO LLC Consolidated Cash Flow Quarter Ended December 31, 2010 Net earnings $147,155,000 Depreciation and amortization 95,925,000 Deferred income taxes (7,661,000) Capitalized leachable material (25,903,000) Others Net (5,533,000) Changes in assets and liabilities 38,478,000 --------------- Cash generated by operating activities 242,461,000 Capital expenditures (26,508,000) Current investments - Restricted cash 12,066,000 Others Net (226,011,000) --------------- Cash used in investing activities (240,453,000) Debt - Net (133,000) Debt amortization - Capital increase - Dividends paid (8,250,000) --------------- Cash used in financing activities (8,383,000) Net increase (decrease) cash & cash equivalents (6,375,000) Cash & cash equivalents at beginning of year 44,713,000 --------------- Cash & cash equivalents at year end $38,338,000 =============== About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: Sues Potentially Responsible Parties in Missouri ------------------------------------------------------------ Reorganized ASARCO LLC commenced a lawsuit in the U.S. District Court for the Western District of Missouri on February 4, 2011 against NL Industries Inc, Freeport-McMoran Copper & Gold Inc., Cyprus Amax Minerals Company, Amax Environmental Services, BNSF Railway, E.I. Dupont De Nemours & Co., Sunoco, Inc., U.S. Steel Corporation, Halliburton Company, KBR, Inc., Doe Run Resources Corporation, and Does 1 - 50. ASARCO brought the civil action, which seeks a jury trial, pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980 for contribution and cost recovery against the Defendants for costs and damages incurred by ASARCO in the Tri-States Mining District consisting of the Tar Creek Superfund Site in Ottawa County, Oklahoma, the Cherokee County Superfund Site in southeast Kansas, the Oronogo-Duenweg Lead Mining Belt Superfund Site in Jasper County, Missouri, and the Newton County Mine Tailings Site, in Missouri. The Defendants have conducted mining, metal processing, storage, transport or related operations through facilities in or near the Sites, W. James Foland, Esq., at Foland, Wickens, Eisfelder, Roper & Hofer, PC, in Kansas City, Missouri -- foland@fwpclaw.com -- tells the Court. He contends that each of the Defendants is liable in tort for any harm to the Tri-States Mining District that occurred in connection with its operations in or near that district. Mr. Foland informs the Missouri Court that ASARCO has recently paid approximately $150 million to settle all of its CERCLA- related liability at the Sites, including response costs and natural resource damages, with the United States Government agencies and the states of Kansas, Oklahoma and Missouri. The Settlement Amount represents more than ASARCO's allocable share of costs related to its releases or disposal of hazardous substances in the Tri-States Mining District, Mr. Foland asserts. He argues that because each Defendant qualifies as a responsible party under Section 107(a) of the CERCLA, each Defendant is liable for its equitable share of any overpayment incurred by ASARCO. Accordingly, ASARCO asks the Missouri Court: -- to direct each Defendant to pay contribution to ASARCO in a sum to be determined by the Missouri Court to be owed to ASARCO for response costs and natural resource damages; -- for a declaratory judgment that each Defendant will be liable for contribution for all response costs, which ASARCO has incurred or may incur in the future in connection with the Tri-States Mining District, which exceed ASARCO's equitable share; -- for a declaratory judgment that each Defendant will be jointly and severally liable for all response costs consistent with the National Contingency Plan and natural resources damages that ASARCO has incurred or may incur in the future in connection with the Tri-States Mining District; and -- for an award of attorneys' fees and costs expended in commencing its lawsuit. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: V. Karl Wants Lift Stay for Prepetition Suits --------------------------------------------------------- Victor Karl filed with the U.S. Bankruptcy Court for the Southern District of Texas a memorandum in further support of his request to lift the automatic stay with respect to his two pending prepetition lawsuits before the U.S. District Court for the Southern District of New York against ASARCO's Parent and the ASARCO Administrative Committee as benefit plans' fiduciaries relating to his entitlement of payments under a post-retirement group life insurance and a Medicare supplement plan. Mr. Karl contends that the automatic stay should be lifted for these reasons: -- In light of his advanced age, infirmities and limited resources and hardship to prosecute the pending lawsuits before the Bankruptcy Court; -- The pattern of animus, discrimination and retaliation of ASARCO against him, and the excessive dilatory tactic of delaying his DIBs claims; -- ASARCO's pervasive bad faith in precipitating the stay of the pending lawsuits, and reneging on an agreement shortly before filing for bankruptcy protection to restore his post-retirement group lift insurance coverage; -- Denial of his day in court to adjudicate his claims since 2002; -- Denial and delay of the adjudication of his statutory and contractual rights as set forth in the complaints in the pending lawsuits; -- ASARCO emerged from Chapter 11 over a year ago; and -- One of the pending lawsuits was ready to be scheduled for trial when ASARCO filed for bankruptcy. In a separate letter to the Court, Mr. Karl says that the Debtors' counsel advised him that Reorganized ASARCO LLC is a separate entity and has no successor liability. "I find this to be preposterous. To put that position in perspective that would mean that there would be NO meaning or purpose to the Automatic Stay of litigation," Mr. Karl argues. He also insists that the Reorganized ASARCO is the alter ego of the old ASARCO, and that they are one and the same. Contrary to the assertion of ASARCO's counsel, Mr. Karl says that he does not remember of the New York District Court notifying him that the pending lawsuit regarding his Medicare supplement plan has been closed. Hence, he asserts, if the automatic stay is lifting as to his pending lawsuits, he will ask for (i) the reactivation of the MSP lawsuit, (ii) the reinstatement of service in that lawsuit, including the addition of new defendants, (iii) an order requiring and accounting his MSP account, and (iv) a protective order for the confidential treatment of his medical records. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) AZUKA FOODS: Case Summary & 17 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Azuka Foods Inc. 1642 Pitkin Avenue Brooklyn, NY 11212 Bankruptcy Case No.: 11-40934 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Jerome Feller Debtor's Counsel: Gary M. Kushner, Esq. FORCHELLI, CURTO, DEEGAN, SCHWARTZ, MINEO, COHN & TERRANA, LLP The Omni 333 Earle Ovington Boulevard, Suite 1010 Uniondale, NY 11553 Tel: (516) 248-1700 Fax: (516) 248-1729 E-mail: Gkushner@ForchelliLaw.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 17 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nyeb11-40934.pdf The petition was signed by Joseph Mbanefo, president. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Rockaway MCD LLC 11-40935 02/09/11 Seaview MCD LLC 11-40936 02/09/11 BADGER STATE BANK: Closed; Royal Bank Assumes All Deposits ---------------------------------------------------------- Badger State Bank of Cassville, Wis., was closed on Friday, February 11, 2011, by the Wisconsin Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Royal Bank of Elroy, Wis., to assume all of the deposits of Badger State Bank. The sole branch of Badger State Bank will reopen during its normal business hours as a branch of Royal Bank. Depositors of Badger State Bank will automatically become depositors of Royal Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Badger State Bank should continue to use their existing branch until they receive notice from Royal Bank that it has completed systems changes to allow other Royal Bank branches to process their accounts as well. As of December 31, 2010, Badger State Bank had around $83.8 million in total assets and $78.5 million in total deposits. In addition to assuming all of the deposits of the failed bank, Royal Bank agreed to purchase essentially all of the assets. Customers who have questions about the transaction can call the FDIC toll-free at 1-800-930-1908. Interested parties also can visit the FDIC's Web site at: http://www.fdic.gov/bank/individual/failed/badgerstate.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $17.5 million. Compared to other alternatives, Royal Bank's acquisition was the least costly resolution for the FDIC's DIF. Badger State Bank is the seventeenth FDIC-insured institution to fail in the nation this year, and the second in Wisconsin. The last FDIC-insured institution closed in the state was Evergreen State Bank, Stoughton, on January 28, 2011. BELTWAY 8: Full Payment Demand Prompted Chapter 11 Filing --------------------------------------------------------- Bill Lodge at The Advocate reports that Beltway 8 Associates, LP, was forced to filed for Chapter 11 filing after FST Watermarke LLC demanded full payment for a loan. Beltway had borrowed $22.2 million for its Watermarke Apartments complex from Compass Bank in Alabama, which later sold the loan to FST Watermarke. The report relates that Baton Rouge developer J.T. "Tommy" Spinosa, Beltway 8 Associates LLC, the sole general partner of the Debtor, believes the complex has a strong chance of emerging from reorganization as a profitable enterprise. "The property is about 96 percent occupied, and the rents are scheduled to go up," William E. Steffes, attorney for the Debtor. The Debtor is facing $25 million in debts to creditors. According to The Advocate, these parties hold an interest in the 280-unit complex: -- University of Alabama football coach Nick Saban holds a 49.5% interest. -- The Spinosa Class Trust holds another 49.5%. -- Beltway 8 Associates LLC holds the remaining 1%. Both Mr. Spinosa and Mr. Saban were listed as general partners of the Debtor when it was formed in December 2004. About Beltway 8 Baton Rouge, Louisiana-based Beltway 8 Associates, LP, dba Watermarke Apartments, owns and operates Watermarke Apartments, a 280 unit residential apartment complex located on approximately 15.6 acres in Houston, Texas. It filed for Chapter 11 bankruptcy protection on January 3, 2011 (Bankr. M.D. La. Case No. 11-10001). William E. Steffes, Esq., at Steffes, Vingiello & McKenzie, LLC, serves as the Debtor's bankruptcy counsel. Judge Douglas D. Dodd presides over the Chapter 11 case. The Debtor disclosed $25.3 million in assets and $25.4 million in liabilities as of the Chapter 11 filing. BERNARD L MADOFF: Bankr. Ct. Stays 3rd Party Suits vs. Madoff Kin ----------------------------------------------------------------- Bankruptcy Judge Burton R. Lifland granted the request of Irving H. Picard, Esq., trustee for the substantively consolidated Securities Investor Protection Act liquidation of Bernard L. Madoff Investment Securities LLC, and Bernard L. Madoff, for an order (i) enforcing the automatic stay and the December 15, 2008 stay order and related orders of the United States District Court for the Southern District of New York and declaring the actions brought in various jurisdictions by certain defendants -- Third Party Plaintiffs -- against Ruth Madoff, Peter Madoff, Andrew Madoff, Mark Madoff, and Shana Madoff void ab initio as against the Madoff Defendants; and (ii) enjoining the Third Party Plaintiffs from litigating the Third Party Actions, or any related actions, against the Madoff Defendants pending completion of the SIPA Trustee's actions against the Madoff Defendants. Certain, but not all, of the Third Party Plaintiffs have filed briefs in opposition to the Motion. The cases are Securities Investor Protection Corporation, v. Bernard L. Madoff Investment Securities LLC, (Substantively Consolidated); and Irving H. Picard, Trustee for the Liquidation of Bernard L. Madoff Investment Securities LLC, v. Richard I. Stahl, et al., Adv. Pro. Nos. 08-01789 and 10-03268 (Bankr. S.D.N.Y.), A copy of Judge Lifland's February 9, 2011 Memorandum Decision is available at http://is.gd/jXJ3N0from Leagle.com. 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: Ex-NY Gov. Cuomo to Mediate Mets Issue -------------------------------------------------------- Chad Bray, writing for Dow Jones Newswires, reports that former New York Gov. Mario Cuomo has been appointed to mediate a legal dispute between the owners of the New York Mets and Irving Picard, the trustee seeking to recover assets on behalf of victims of Bernard Madoff's fraud. Dow Jones relates that in an order Thursday, U.S. District Judge Burton Lifland recommended the case be referred to "an appropriately experienced mediator" and appointed the former governor, who now works at Willkie Farr & Gallagher LLP. The order indicated both parties consented to his appoint. Mr. Picard is seeking up to about $1 billion from Fred Wilpon, his brother-in-law Saul Katz, their partners, relatives and entities related to their real-estate investment firm, Sterling Equities Associates. Mr. Picard has alleged the Mets owners and their business partners failed to investigate direct warnings and evidence that Mr. Madoff was conducting a Ponzi scheme, while reaping hundreds of millions of fictitious profits. He is seeking the return of nearly $300 million in fictitious profits, as well as up to $700 million in principal withdrawn since 2002. Messrs. Wilpon and Katz have called the allegations "abusive, unfair and untrue." "The plain truth is that not one of the Sterling partners ever knew or suspected that Madoff ran a Ponzi scheme," they said in a statement last week. Dow Jones says a call to Mr. Cuomo's office wasn't immediately returned late Thursday. A spokesperson for Mr. Picard didn't immediately respond to a request for comment late Thursday. 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: Has Approval for Deloitte as Valuation Advisor --------------------------------------------------------------- In accordance with Sections 328(a) and 327 of the Bankruptcy Code, the Bankruptcy Court authorized Blockbuster Inc. and its units to employ Deloitte Financial Advisory Services LLP as their valuation services provider in accordance with the terms set forth in the Engagement Letter, effective nunc pro tunc to the November 10, 2010. Judge Burton Lifland ruled that all requests of Deloitte FAS for payment of indemnity pursuant to the Engagement Letter will be made by application to the Court and will be subject to review by the Court to ensure that payment of the indemnity conforms to the terms of the Engagement Letter, and is reasonable based upon the circumstances of the litigation or settlement in respect of which indemnity is sought, provided that in no event will Deloitte FAS be indemnified in the case of its own bad faith, self-dealing, breach of fiduciary duty, gross negligence or willful misconduct. In no event will Deloitte FAS be indemnified if the Debtors or a representative of the Debtors' bankruptcy estates, asserts a claim for, and a court determines by final order that the claim arose out of, Deloitte FAS' own bad-faith, self-dealing, breach of fiduciary duty, gross negligence or willful misconduct. In the event that Deloitte FAS seeks reimbursement for attorneys' fees from the Debtors pursuant to the Engagement Letter, the invoices and supporting time records from the attorneys will be included in Deloitte FAS' own applications and the invoices and time records will be subject to the United States Trustee's Guidelines for compensation and reimbursement of expenses and the approval of the Court under the standards of Sections 330 and 331 of the Bankruptcy Code without regard to whether the attorney has been retained under Section 327 and without regard to whether the attorneys' services satisfy Section 330(a)(3)(C). Deloitte FAS will not be entitled to reimbursement by the Debtors for any fees, disbursements, or other charges of Deloitte FAS' attorneys, other than those incurred in connection with a request of Deloitte FAS for payment of indemnity, Judge Lifland added. Judge Lifland also directed PwC to provide a 10-day notice to the Debtors, the U.S. Trustee, the Official Committee of Unsecured Creditors, and any other official committee prior to any increases in the rates set forth in the application and the Engagement Letter, and the notice must be filed with the Court. The U.S. Trustee retains all rights to object to any rate increase on all grounds, including the reasonableness standard provided for in Section 330 of the Bankruptcy Code, and the Court retains the right to review any rate increase pursuant to Section 330. Prior to the entry of the order, no objections were filed, but the Debtors received informal comments to the form of order from the Office of the United States Trustee for Region 2. Hence, the Debtors submitted a revised proposed order to resolve the U.S. Trustee's concerns. As valuation services advisor, Deloitte FAS will: (a) develop an estimate of the fair value of the business enterprise of the Debtors' reporting units as of the effective date of a plan of reorganization; (b) perform a reconciliation of the aggregate value of the Reporting Units to the overall enterprise value of the Debtors; (c) develop estimates of fair value of the business enterprise of the Debtors' various legal entities as of the Effective Date; and (d) develop an estimate of the fair value of certain assets and liabilities as of the Effective Date for each of the Reporting Units. The assets and liabilities subject to appraisal are anticipated to include: -- Tangible Assets: * Merchandise inventory; * Rental library; * Real property assets; and * Personal property assets; -- Intangible Assets: * Trademarks/trade names; * Movie studio contracts/relationships; * Customer lists/relationships; * Favorable contracts; * Technology patents; and * Employment/non-compete agreements; and -- Liabilities: * Unfavorable leasehold interests; and * Unfavorable contracts. The Debtors will pay Deloitte FAS based on these agreed hourly rates: Personnel Classification Rate ------------------------ ----- Partner, Principal, or Director $550 Senior Manager $475 Manager $425 Senior Associate $325 Associate and Junior Staff $275 Deloitte FAS will also be reimbursed of its necessary expenses. 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) BLOCKBUSTER INC: M. Rudd Insists on Request for Equity Committee ---------------------------------------------------------------- As a follow up to his request for the appointment of an equity committee in Blockbuster Inc.'s bankruptcy cases, Mark L. Rudd submitted to the Bankruptcy Court more information in hopes that further consideration will be given to the sought appointment. Among the information provided are, as asserted by Mr. Rudd, links to "some of the good news and recent happenings that are lining up to show Blockbuster has a very bright future." As a party-in-interest, Mr. Rudd says that he understands that the burden is on the equity holders to convincingly prove these standards for the appointment of an equity committee to the US Trustee and subsequently the bankruptcy judge: (1) Number of shareholders; (2) Complexity of the case; (3) Whether the interests of shareholders are already represented; (4) Solvency of the Debtor; and (5) Cost to estate outweighs the adequate representation interest of shareholders. Mr. Rudd tells the Court that the standards are met. He alleges that it is clear that the Debtors, the Official Committee of Unsecured Creditors, secured noteholders and senior noteholders are not looking out for the interests of the shareholders. In fact, he contends, they all agree that the equity holders are not parties-in-interest, even though the actions of these other entities do show they see value in Blockbuster. "The nature of this particular proceeding is such that without an equity committee the shareholders will have no voice," Mr. Rudd asserts. The Debtors' claims that "they are hopelessly insolvent is clearly untrue, they are still admitting to generating close to 3 billions in revenue, with one billion in debt, debt that can be swapped for equity by the court," Mr. Rudd also contends. He points out that the bankruptcy estates will survive and prosper. He insists that the equity holders should be allowed to participate in the plan process in hopes that they can eventually participate in the confirmation of that plan. 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) BLOCKBUSTER INC: Wins OK for PricewaterhouseCoopers as Auditors --------------------------------------------------------------- The Bankruptcy Court authorized Blockbuster Inc. and its debtor- affiliates to employ PricewaterhouseCoopers LLP as their independent auditors and accounting advisors, nunc pro tunc to the Petition Date, in accordance with the terms and conditions set forth in the Engagement Letters. Judge Burton Lifland directed PwC to provide a 10-day notice to the Debtors, the U.S. Trustee, the Official Committee of Unsecured Creditors, and any other official committee prior to any increases in the rates set forth in the application and the Engagement Letters, and the notice must be filed with the Court. The U.S. Trustee retains all rights to object to any rate increase on all grounds, including the reasonableness standard provided for in Section 330 of the Bankruptcy Code, and the Court retains the right to review any rate increase pursuant to Section 330. Notwithstanding anything to the contrary in the Engagement Letters, the application, or the affidavit submitted with the application, to the extent that the Debtors require PwC to perform any services other than (i) those detailed in the Engagement Letters, and (ii) other services directly related to services detailed in the Engagement Letters in the Chapter 11 cases, the Debtors will seek further application for an order of approval by the Court for those additional services and that application will set forth, in addition to the additional services to be performed, the additional fees sought to be paid. Judge Lifland also ruled that PwC will not be entitled to the reimbursement of attorney fees and expenses other than in connection with indemnification set forth in the application. Prior to the entry of the order, no objections were filed, but the Debtors received informal comments to the form of order from the Office of the United States Trustee for Region 2. Hence, the Debtors submitted a revised proposed order to resolve the U.S. Trustee's concerns. As auditors and advisors, PwC has agreed to: -- under the 2010 Audit Engagement Letter: * perform an integrated audit of the consolidated financial statements for 2011; and * audit and report on the effectiveness of the Debtors' internal controls over financial reporting as of January 2, 2011, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal controls over financial reporting based on the assessed risk, and performing other procedures as necessary; and -- under the Bankruptcy Services Statement of Work: * scope the Debtors' fresh start accounting and incremental audit procedures associated with the filing of the Debtors' Chapter 11 bankruptcy petitions, as well as providing advisory services to further educate the Debtors on GAAP requirements, potential accounting choices they may select, and industry standard practices that are traditionally used during the application of fresh start accounting; and * perform additional incremental audit procedures related to the Debtors' accounting during bankruptcy. PwC may also render additional related support and services deemed appropriate and necessary to the Debtors' bankruptcy estates, including recurring tax consulting services and services relating to matters involving tax authorities. To the extent that the Debtors ask that PwC perform additional services not contemplated by the Engagement Letters or directly related to services detailed in the Engagement Letters, the Debtors will seek further Court order. Pursuant to the terms and conditions of the Engagement Letters, and subject to the Court's approval, the Debtors propose to (i) compensate PwC for the services rendered pursuant to the Engagement Letters, (ii) compensate PwC for all additional services it provides to the Debtors on an hourly basis in accordance with PwC's ordinary and customary rates in effect on the date the services are rendered, and (iii) reimburse actual and necessary costs and expenses incurred by PwC in connection with the services performed on behalf of the Debtors. The estimated total fees to be paid to PwC for the services to be provided is: Services Provided Estimated Fees ----------------- -------------- Integrated Audit $2,500,000 (2010 Audit Engagement Letter) Bankruptcy Specialist Assistance $250,000 - $300,000 with the Integrated Audit (Statement of Work) PwC's domestic hourly rate ranges are: Professional Level Hourly Rate Range ------------------ ----------------- Partner $520 - $910 Managing Directors $510 - $580 Director/Senior Manager $360 - $650 Manager $255 - $400 Senior Associate $190 - $335 Associate/Analysts $105 - $290 Paraprofessional $70 - $135 Mr. McDonald discloses that PwC is not owed any amounts for prepetition services performed for the Debtors. He adds that in the 90 days prior to the Petition Date, Blockbuster paid PwC $959,955 in fees and $17,339 for reimbursement of expenses. David Evans, a partner at PwC, assures the Court that PwC is a "disinterested person," as defined in Section 101(14) of the Bankruptcy Code. 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) BORDERS GROUP: Bankruptcy Filing Seen Monday or Tuesday, WSJ Says ----------------------------------------------------------------- The Wall Street Journal reports that people familiar with the matter said Borders Group may file for bankruptcy reorganization as early as Monday or Tuesday. The Wall Street Journal's Jeffrey A. Trachtenberg and Paul Sonne report that, according to people familiar with the matter, Borders has been putting the finishing touches on a store-closure program that could eliminate more than one-third of its 674 stores as part of a Chapter 11 restructuring. Michael J. De La Merced and Julie Bosman, writing for The New York Times' DealBook, report that Borders had largely failed to persuade publishers to convert payments they had been owed since late last year into interest-bearing loans. NY Times' DealBook relates that according to a person briefed on the matter Borders has also been working on securing financing to support itself through a Chapter 11 filing. Borders had indicated in January it might need to file for bankruptcy despite receiving a $550 million loan commitment from GE Capital. "There have been constant inquiries by reporters, and stories written, regarding whether Borders is considering a Chapter 11 filing," Mary Davis, a Borders spokeswoman, wrote in an e-mailed statement, according to NY Times' DealBook. "Borders is not prepared at this time to report on the course of action it will pursue." According to the Journal's Messrs. Trachtenberg and Sonne, liquidation firms that specialize in running "going out of business" sales have been bidding in recent days for the right to close unprofitable Borders stores. The Journal relates Borders initially plans to close about 200 stores, and possibly 50 or so more later. Borders plans to get a bankruptcy loan and use court proceedings to slim down and remain viable. Wall Street bankers and lawyers who have studied the chain believe avoiding liquidation could be a long shot. The Journal says Borders declined to comment. Sources told NY Times' DealBook that neither of Borders' biggest shareholders -- the company's chairman and chief executive, Bennett S. LeBow, and the hedge fund manager William A. Ackman -- has indicated a willingness to put new money into the bookseller. DealBook notes that Mr. Ackman disclosed in a regulatory filing late last year that he would be willing to loan Borders up to $960 million to finance a merger with Barnes & Noble, the company's bigger rival. Shares in Borders began falling on Friday after news of the bankruptcy filing's timing was reported by The Wall Street Journal online. The shares dropped to 25 cents in late-afternoon trading. Borders' stock has fallen nearly 80% over the last 12 months. According to the Journal's Messrs. Trachtenberg and Sonne, a Borders bankruptcy filing will mean fewer places for consumers to buy books, which in turn is expected to speed the pace of online and e-book sales. "Once physical shelf space is gone, it's gone forever," says Mark Coker, chief executive of Smashwords Inc., an e-book publishing and distribution platform based in Los Gatos, California, according to the Journal. "If you remove books from our towns and villages and malls, there will be less opportunity for the serendipitous discovery of books. And that will make it tougher to sell books." About Borders Group Headquartered in Ann Arbor, Mich., Borders Group, Inc. (NYSE: BGP) -- http://www.borders.com/-- is a specialty retailer of books as well as other educational and entertainment items. It employs 19,500 throughout the U.S., primarily in its Borders(R) and Waldenbooks(R) stores. Borders is the nation's second-largest bookstore chain by revenue, behind Barnes & Noble Inc. As of October 30, 2010, Borders had total assets of $1.35 billion, total liabilities of $1.40 billion, and a stockholders' deficit of $40.8 million. Borders received a financing commitment of $550 million from the General Electric unit on Jan. 27. The funding had several conditions including securing $175 million from other lenders and $125 million in junior debt provided by vendors and lenders. The funding is also contingent on Borders completing a program to close stores. Borders said on Dec. 30, 2010, that it was delaying payments to some publishers. News sources report that Borders has tapped Jefferies & Co. for investment banking services, has turned to Kasowitz, Benson, Torres & Friedman for legal advice, and has hired restructuring specialist FTI Consulting Inc. for additional advice and counsel. The New York Times has reported that Lowenstein Sandler is providing legal counsel and Alvarez & Marsal is providing other corporate restructuring guidance to a group of publishers. BOSQUE POWER: Senior Lenders' Plan Becomes Effective ---------------------------------------------------- The First Amended Joint Plan of Reorganization proposed by the senior lenders for Bosque Power Company, LLC, BosPower Partners, LLC, and Fulcrum Marketing and Trade, LLC, became effective February 4, 2011. The Bankruptcy Court confirmed the Plan on October 7, 2010. The Plan provides for full payment of allowed general unsecured claims in Class 5. Holders of allowed prepetition secured claims in Class 2 will receive its pro rata share of 100% of the new securities issued by BPP and outstanding on the effective date. Although Holders of Intercompany Interests in BPC will not receive any distribution on account of the intercompany interests, intercompany interests in BPC will not be cancelled and, solely to implement the PSP Plan, will be reinstated. A full-text copy of the disclosure statement explaining the Lenders' Plan is available for free at: http://bankrupt.com/misc/BosquePower_LendersDS.pdf Counsel to CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH are: Mitchell A. Seider, Esq. David A. Hammerman, Esq. LATHAM & WATKINS, LLP 885 Third Avenue New York, NY 10022-4834 Telephone: 212-906-1200 Facsimile: 212-751-4864 E-mail: Mitchell.Seider@lw.com David.Hammerman@lw.com Counsel to the REQUIRED LENDERS are: Dennis F. Dunne, Esq. Steven Z. Szanzer, Esq. MILBANK, TWEED, HADLEY & McCLOY LLP One Chase Manhattan Plaza New York, New York 10005-1413 Telephone: 212-530-5000 Facsimile: 212-530-5219 E-mail: ddunne@milbank.com sszanzer@milbank.com Counsel to CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH and the REQUIRED LENDERS are: Robert D. Albergotti, Esq. Abigail Ottmers, Esq. HAYNES AND BOONE, LLP 2323 Victory Avenue, Suite 700 Dallas, Texas 75219 Telephone: 214-651-5000 Facsimile: 214-651-5940 E-mail: robert.albergotti@haynesboone.com eric.terry@haynesboone.com abigail.ottmers@haynesboone.com About Bosque Power Laguna Park, Texas-based Bosque Power Company, LLC, owns and operates a natural gas fired power plant with a capacity of 800 megawatts. The power-generating facility, located in Laguna Park, commenced operations as a natural-gas power plant in 2000. Bosque sells its energy and ancillary services in the Texas power market. Bosque Power Partners owns 100% of the membership interest in Bosque Power. Bosque Power filed for Chapter 11 protection in Waco, Texas (Bankr. W.D. Tex. Case No. 10-60348). Affiliate BosPower Development, BosPower Development Blocker I, BosPower Development Blocker II, BosPower Partners and Fulcrum Marketing and Trade also sought bankruptcy protection. Jeff J. Marwil, Esq., Peter J. Young, Esq., and Grayson T. Walter, Esq., at Proskauer Rose LLP, in Chicago, Illinois, serve as the Debtors' counsel. Henry J. Kaim, Esq., at King & Spalding LLP, serves as bankruptcy co-counsel to the Debtors. The Debtors also tapped Morgan, Lewis & Bockius LLP as special corporate counsel; Greenhill & Co. LLC as financial advisor; and Kurtzman Carson Consultants LLC as claims agent. BOSTON GENERATING: Appeals Court Won't Reverse Constellation Sale ----------------------------------------------------------------- Joseph Checkler at Dow Jones' Daily Bankruptcy Review reports that, in a filing with the U.S. Court of Appeals for the Second Circuit made last week, three judges denied the appeal of MatlinPatterson Global Advisors LLC and Wilmington Trust FSB, the agent for Boston Generating's second-lien lenders, to overturn the sale of Boston Generating's assets to Constellation Energy Group Inc. According to Dow Jones, the creditors had appealed a $1.1 billion sale of Boston Generating to fellow utility Constellation, which closed in early January after receiving approval from both Judge Shelley C. Chapman of U.S. Bankruptcy Court in Manhattan and the Federal Energy Regulatory Commission. The closing of the sale made it unlikely that an appeal would succeed. MatlinPatterson and Wilmington Trust, Dow Jones recalls, argued that Boston Generating was worth far more than what it was sold for, and that a proper "appraisal" of the company wasn't conducted in bankruptcy court. Judge Chapman in December allowed for the creditors' appeal, but ruled not to stop the sale pending the appeal. A clerk at the U.S. Court of Appeals said there wouldn't be a written opinion about why the appeal was denied. About Boston Generating New York-based Boston Generating, LLC, owns nearly 3,000 megawatts of mostly modern natural gas-fired power plants in the Boston area. Privately held Boston Generating is an indirect subsidiary of US Power Generating Co., and considers itself as the third- largest fleet of plants in New England. Boston Generating filed for Chapter 11 protection on August 18, 2010 (Bankr. S.D.N.Y. Case No. 10-14419). Boston Generating estimated its assets and debts at more than $1 billion as of the Petition Date. EBG Holdings LLC; Fore River Development, LLC; Mystic, LLC; Mystic Development, LLC; BG New England Power Services, Inc.; and BG Boston Services, LLC, filed separate Chapter 11 petitions. D. J. Baker, Esq., at Latham & Watkins LLP, serves as bankruptcy counsel for the Debtors. JPMorgan Securities is the Debtors' investment banker. Perella Weinberg Partners, LP, is the Debtors' financial advisor. Brown Rudnick LLP is the Debtors' regulatory counsel. FTI Consulting, Inc., is the Debtors' restructuring consultant. Anderson Kill & Olick, P.C., is the Debtors' conflicts counsel. The Garden City Group, Inc., is the Debtors' claims agent. The Official Committee of Unsecured Creditors has tapped the law firm of Jager Smith P.C. as its counsel. BRISAM COVINA: Has Until March 17 to Propose Chapter 11 Plan ------------------------------------------------------------ The Hon. Robert E. Grossman of the U.S. Bankruptcy Court for the Eastern District of New York extended Brisam Covina LLC's exclusive periods to file and solicit acceptances for their proposed chapter 11 plan until March 17, 2011, and May 17, respectively. Uniondale, New York-based Brisam Covina LLC, dba Radisson Sultes Hotel Covina, filed for Chapter 11 protection on August 17, 2010 (Bankr. E.D.N.Y. Case No. 10-76441). John Westerman, Esq., and Mickee M. Hennessy, Esq., at Westerman Ball Ederer Miller & Sharfstein, LLP, represent the Debtor. The Debtor disclosed $18.4 million in assets and $19.6 million in liabilities as of the Chapter 11 filing. BRISAM COVINA: Can Continue Using Cash Collateral Until Feb. 18 --------------------------------------------------------------- Brisam Covina LLC has obtained authorization from the Hon. Robert E. Grossman of the U.S. Bankruptcy Court for the Eastern District of New York to continue using the cash collateral until February 18, 2011. Ixis Real Estate Capital, Inc., subsequently known as Natixis Real Estate Capital Inc., asserts, among other things, a valid and perfected first priority lien against all of the Debtor's assets, including its cash and accounts receivable. The Debtor had borrowed from Natixis $16.4 million for the purchase and renovation of a hotel and certain other property. Mickee M. Hennessy, Esq., at Westerman Ball Ederer Miller & Sharfstein, LLP, explained that the Debtor needs to use Natixis' cash collateral to fund its Chapter 11 case, pay suppliers and other parties. The Debtors will use the collateral. The Debtor will provide the Lender these reports: (i) a bi-weekly written report, commencing on September 13, 2010, and on every other Monday thereafter during the interim period, itemizing any disbursements through the Friday prior, by category authorized herein and pursuant to the budget including a reconciliation of actual to planned payments; (ii) a bi-weekly written report, commencing on September 13, 2010, and on every other Monday thereafter during the interim period, setting forth collection and disbursement activity in all of the Debtor's Bank Accounts, including a reconciliation of actual to forecasted cash flow through the Friday prior; and (iii) all reports which Debtor is obligated to deliver to Lender pursuant to the Loan Agreement, as and when required thereunder. The Debtor will make its request for operating expense funding substantially in the form and manner as that made to the Lender prior to August 17, 2010, provided, however, that the requests and transfers will be made on a bi-weekly basis in amounts consistent with the budget unless otherwise agreed by the Lender. A continued hearing on the Debtor's request to use cash collateral will be held on February 9, 2011, at 1:30 p.m. Uniondale, New York-based Brisam Covina LLC, dba Radisson Sultes Hotel Covina, filed for Chapter 11 protection on August 17, 2010 (Bankr. E.D.N.Y. Case No. 10-76441). John Westerman, Esq., and Mickee M. Hennessy, Esq., at Westerman Ball Ederer Miller & Sharfstein, LLP, represent the Debtor. The Debtor disclosed $18.4 million in assets and $19.6 million in liabilities as of the Chapter 11 filing. CALIFORNIA COASTAL: Aims to Terminate Underfunded Pension Plan -------------------------------------------------------------- Dow Jones' DBR Small Cap reports that California Coastal Communities Inc. is looking to terminate its underfunded pension plan in a move that its lenders have made a condition if they are to fund the restructuring of the Debtor. California Coastal said it made "exhaustive efforts" to maintain its obligations to the defined-benefit pension plan covering 68 current and former employees, but its lenders have "steadfastly refused" to support a Chapter 11 plan of reorganization that would leave these obligations intact, according to DBR. "The debtors' only remaining option for exiting Chapter 11 with the continued employment of its work force is confirmation of the current proposed plan of reorganization and termination of the pension plan," California Coastal said in court papers filed, the report notes. About California Coastal Irvine, California-based California Coastal Communities, Inc. (OTC QB: CALCQ) -- http://www.californiacoastalcommunities.com/-- is a residential land development and homebuilding company with properties owned or controlled primarily in Orange County, California, and also in Lancaster in Los Angeles county. The Company's primary asset is a 356-home luxury coastal community known as Brightwater in Huntington Beach, California. California Coastal Communities, Inc. and certain of its direct and indirect wholly-owned subsidiaries filed for Chapter 11 bankruptcy protection on October 27, 2009 (Bankr. C.D. Calif. Case No. 09-21712). Joshua M. Mester, Esq., in Los Angeles, California, serves as counsel to the Debtors. The Company's financial advisor is Imperial Capital, LLC. California Coastal estimated $100 million to $500 million in assets and debts in its Chapter 11 petition. CALIFORNIA COASTAL: Plan Confirmation Hearing Set for February 16 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California will convene a hearing on Feb. 16, 2011, at 11:00 a.m., to consider the confirmation of California Coastal Communities, Inc., et al.'s Plan of Reorganization, amended as of January 12. The Company has support of the Plan from over 80% of its senior secured lenders. That Plan deleverages the Company by converting $56 million of the senior term loan into equity and provides no recovery for current equity holders. A full-text copy of the disclosure statement explaining the Plan is available for free at http://bankrupt.com/misc/CALIFORNIACOASTAL_amendedDS.pdf About California Coastal Irvine, California-based California Coastal Communities, Inc. -- http://www.californiacoastalcommunities.com/-- is a residential land development and homebuilding company with properties owned or controlled primarily in Orange County, California, and also in Lancaster in Los Angeles county. The Company's primary asset is a 356-home luxury coastal community known as Brightwater in Huntington Beach, California. California Coastal Communities, Inc. and certain of its direct and indirect wholly-owned subsidiaries filed for Chapter 11 bankruptcy protection on October 27, 2009 (Bankr. C.D. Calif. Case No. 09-21712). Joshua M. Mester, Esq., in Los Angeles, California, serves as counsel to the Debtors. The Company's financial advisor is Imperial Capital, LLC. California Coastal disclosed $4.23 million in assets and $250.5 million in liabilities as of the Chapter 11 filing. CANYON NAT'L BANK: Closed; Pacific Premier Bank Assumes Deposits ---------------------------------------------------------------- Canyon National Bank of Palm Springs, Calif., was closed on Friday, February 11, 2011, by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Pacific Premier Bank of Costa Mesa, Calif., to assume all of the deposits of Canyon National Bank. The three branches of Canyon National Bank will reopen during their normal business hours as branches of Pacific Premier Bank. Depositors of Canyon National Bank will automatically become depositors of Pacific Premier Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Canyon National Bank should continue to use their existing branch until they receive notice from Pacific Premier Bank that it has completed systems changes to allow other Pacific Premier Bank branches to process their accounts as well. As of December 31, 2010, Canyon National Bank had around $210.9 million in total assets and $205.3 million in total deposits. In addition to assuming all of the deposits of the failed bank, Pacific Premier Bank agreed to purchase essentially all of the assets. Customers who have questions about the transaction can call the FDIC toll-free at 1-800-930-5169. Interested parties also can visit the FDIC's Web site at: http://www.fdic.gov/bank/individual/failed/canyonstate.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $10.0 million. Compared to other alternatives, Pacific Premier Bank's acquisition was the least costly resolution for the FDIC's DIF. Canyon National Bank is the eighteenth FDIC-insured institution to fail in the nation this year, and the first in California. The last FDIC-insured institution closed in the state was First Vietnamese American Bank, Westminster, on November 5, 2010. CARLTON GLOBAL: Files Schedules of Assets and Liabilities --------------------------------------------------------- Carlton Global Resources, LLC, filed with the U.S. Bankruptcy Court for the Central District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $29,800,000 B. Personal Property $9,044,466 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $3,989,122 E. Creditors Holding Unsecured Priority Claims $15,000 F. Creditors Holding Unsecured Non-priority Claims $3,616,280 ----------- ----------- TOTAL $38,844,466 $7,620,402 Henderson, Nevada-based Carlton Global Resources, LLC, filed for Chapter 11 banrkuptcy protection on December 1, 2010 (Bankr. C.D. Calif. Case No. 10-48739). According to the Debtor's docket, the Court denied employment of Stephen R. Wade as counsel. To date, the Debtor has not applied for a replacement of Mr. Wade. The case was reassigned from Judge Thomas B. Donovan to Judge Scott C. Clarkson. CATHOLIC CHURCH: CMRSA Wants Fairbanks Trustee Objection Denied --------------------------------------------------------------- The Catholic Mutual Relief Society of America filed a response to the objections to the Court's proposed findings of fact and conclusions of law filed by Robert L. Berger, settlement trustee under the Catholic Bishop of Northern Alaska's Third Amended and Restated Joint Plan of Reorganization. In its response, Catholic Mutual says that the Court's recommendations in its Proposed Findings may be summarized as: (1) Catholic Mutual's second motion for partial summary judgment should be granted because the Diocese's conduct in entering into the Third Amended and Restated Joint Plan of Reorganization constitutes a material breach of the occurrence-based coverage certificates that Catholic Mutual issued to CBNA, which was not excused by any prior breach of those certificates by Catholic Mutual; and (2) Catholic Mutual's motion to compel arbitration should be granted in part, to require the Settlement Trustee to submit all disputes under the claims-made certificate to Catholic Mutual as provided for under the dispute resolution provisions found in that certificate. The Settlement Trustee does not challenge the Court's conclusion that the Diocese has materially breached the terms of the occurrence-based Certificates, relates John C. Wendlandt, Esq., at Sedor, Wendlandt, Evans & Filippi, LLC, in Anchorage, Alaska. He contends that the Settlement Trustee, therefore, has conceded to the issue of the Diocese's material breach. "This concession disposes not only of the issue of CBNA's material breach of the certificates, but also the issue of the resulting prejudice to Catholic Mutual, which vitiates coverage as a matter of law," Mr. Wendlandt argues. He asserts that the Settlement Trustee's attempts to deny prejudice to Catholic Mutual are not only legally irrelevant, but wrong as a matter of law. The Settlement Trustee argues that issues of arbitrability regarding the claims-made certificate do not represent an actual controversy amenable to judicial determination, and the Court erred in finding that the dispute resolution procedures in the claims-made certificate are not unconscionable, Mr. Wendlandt says. However, he points out, the dispute between Catholic Mutual and the Settlement Trustee over the unconscionability -- and enforceability -- of the procedures represents a concrete controversy of sufficient magnitude and immediacy to justify the Court's determination that claims be submitted to arbitration in accordance with the procedures. Accordingly, Catholic Mutual asks the Court to overrule the Settlement Trustee's objections to the Proposed Findings. About the Diocese of Fairbanks The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka The Diocese of Fairbanks, aka CBNA -- http://www.cbna.info/-- filed for Chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its restructuring efforts. Michael R. Mills, Esq., of Dorsey & Whitney LLP serves as the Debtor's local counsel and Cook, Schuhmann & Groseclose Inc. as its special counsel. Judge Donald MacDonald, IV, of the United States Bankruptcy Court for the District of Alaska presides over Fairbanks' Chapter 11 case. In its schedules, the Debtor disclosed total assets of $13,316,864 and total liabilities of $1,838,719 as of the Petition Date. The Bankruptcy Court entered its order confirming the "Debtor's and the Official Committee of Unsecured Creditors' Third Amended and Restated Joint Plan of Reorganization for the Catholic Bishop of Northern Alaska" on February 17, 2010. The effective date of the Plan occurred on March 19, 2010. In November 2010, Judge Donald MacDonald IV entered a final decree and order closing the Chapter 11 case of the Catholic Bishop of Northern Alaska. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CATHOLIC CHURCH: Milwaukee Committee Taps Pachulski as Counsel -------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in the Archdiocese of Milwaukee's bankruptcy case seeks authority from the United States Bankruptcy Court for the Eastern District of Wisconsin to retain Pachulski Stang Ziehl & Jones LLP as its counsel, nunc pro tunc to January 25, 2011. Charles Linneman, chairman of the Creditors Committee, tells Judge Kelley that Pachulski Stang has represented official committees in other diocesan bankruptcy cases, and is well-qualified to render the proposed services to the Creditors Committee. As counsel, Pachulski Stang will, among other things: (a) assist, advise and represent the Creditors Committee in its consultations with the Archdiocese regarding the administration of the case; (b) assist, advise and represent the Creditors Committee in analyzing the Archdiocese's assets and liabilities, investigate the extent and validity of liens and participate in and review any proposed asset sales, any asset dispositions, financing arrangements and cash collateral stipulations or proceedings. Pachulski Stang does not anticipate involvement in analyzing the Debtor's liability to any particular survivor of sexual abuse; (c) review and analyze all applications, motions, orders, statements of operations and schedules filed with the Court by the Archdiocese or third parties, advise the Creditors Committee as to their propriety, and, after consultation with the Creditors Committee, take appropriate action; (d) prepare necessary applications, motions, answers, orders, reports and other legal papers on behalf of the Creditors Committee; (e) represent the Creditors Committee at hearings held before the Court and communicate with the Creditors Committee regarding the issues raised, as well as the decisions of the Court; and (f) to perform all other legal services for the Creditors Committee, which may be necessary and proper in the proceeding. Pachulski Stang will be paid based on its standard hourly rates, and will be reimbursed for actual, necessary expenses and other charges. The principal attorneys presently designated to represent the Creditors Committee and their current standard hourly rates are: Professional Rate ------------ ---- James I. Stang $650 Kenneth H. Brown $650 Gillian N. Brown $550 Pamela E. Singer $550 Gillian N. Brown, Esq., a partner at Pachulski Stang, assures the Court that the firm is a "disinterested person," as that term is defined in Section 101(14) of the Bankruptcy Code. About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on January 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: Milwaukee Panel Taps Howard as Local Counsel ------------------------------------------------------------- The Official Committee of Unsecured Creditors in the bankruptcy case of the Archdiocese of Milwaukee seeks permission from the United States Bankruptcy Court for the Eastern District of Wisconsin to retain Howard, Solochek & Weber, S.C., as its local counsel, nunc pro tunc to January 25, 2011. As local counsel, HS&W will, among other things: -- advise the Creditors Committee with respect to its rights, duties and powers in the bankruptcy case; -- assist and advise the Creditors Committee in its consultations with the Archdiocese relating to the administration of the case; -- assist and advise the Creditors Committee in analyzing the claims of the Archdiocese's creditors and its capital structure, and in negotiating with the holders of claims, and if appropriate, equity interests; -- assist the Creditors Committee's investigation of the acts, conduct, assets, liabilities and financial condition of the Archdiocese and other parties involved with the Diocese and its operation; and -- assist the Creditors Committee in analyzing transactions and issues relating to the Archdiocese's non-debtor affiliates. Albert Solochek, Esq., Andrew Herback, Esq., and Jason Pilmaier, Esq., are presently expected to do the primary work on the case, Charles Linneman, chairman of the Creditors Committee, informs Judge Kelley. HS&W will be paid based on its ordinary and customary hourly rates in effect on the date the services are rendered, and will be reimbursed of its necessary expenses. The current hourly rates of HS&W are: Professional Rate ------------ ---- Partners $225 Associates $200 Paraprofessionals $50 - $70 Mr. Solochek assures Judge Kelley that HS&W is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on January 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CCT COMMUNICATIONS: Shareholder's Bid for Fee Examiner Denied ------------------------------------------------------------- Bankruptcy Judge Stuart M. Bernstein denied the request of Dean Vlahos, the sole shareholder of CCT Communications, Inc., for reconsideration of the Court's Memorandum Decision Regarding Final Fee Applications by Robinson Brog Leinwand Greene Genovese & Gluck P.C. and Wiley Rein LLP, dated Aug. 24, 2010. Mr. Vlahos challenges the Court's refusal to appoint a fee examiner, or alternatively, conduct an evidentiary hearing. Mr. Vlahos reasons that there must be duplication in the fees requested by Robinson Brog, the Debtor's general bankruptcy counsel, and Wiley Rein, which advised the Debtor with respect to telecommunications issues, because both fee applications admit that the firms spent the vast majority of their time on the litigation involving Global Crossing. Furthermore, the only way to deal with the prima facie duplication was to appoint an examiner or conduct a hearing. Judge Bernstein said Mr. Vlahos has not identified any controlling legal principle that the Court overlooked. Judge Bernstein pointed out that "fee examiners" are not even provided for by the Bankruptcy Code and there is no rule or standard mandating their appointment. Mr. Vlahos has also failed to identify any material factual matters that the Court overlooked. A copy of Judge Bernstein's January 22, 2011 Memorandum Decision is available at http://is.gd/ilj9myfrom Leagle.com. CCT Communications, Inc., filed a chapter 11 petition (Bankr. S.D.N.Y. Case No. 07-10210) on Jan. 29, 2007, represented by Arnold Mitchell, Esq., at Greene Robinson Brog Leinwand Greene Genovese & Gluck, P.C., at that time. Sanford P. Rosen, Esq., at Rosen & Associates, P.C., and Glenn B. Manishin, Esq., at Duane Morris LLP, also represent the Debtor. At the time of the filing, the Debtor disclosed $774,047 in assets and debts of $1,028,249. CCT filed a Plan of Reorganization on the last possible day -- November 26, 2007 -- to do so as a small business debtor. The Debtor intended to fund the plan distributions, at least in part, with the proceeds generated through adversary proceedings against Global Crossing Telecommunications, Inc., and Zone Telecom, Inc. The Honorable Stuart M. Bernstein conducted a two-day evidentiary hearing, and concluded that CCT is judicially estopped from taking the position that it is not a small business debtor. Chief Judge Bernstein ruled that the case will be dismissed, but the Court will retain jurisdiction over the adversary proceeding between CCT and Global Crossing as well as any fee applications by Court- appointed professionals. CDC PROPERTIES: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: CDC Properties I, LLC 820 A Street #300 Tacoma, WA 98402 Bankruptcy Case No.: 11-41010 Chapter 11 Petition Date: February 10, 2011 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Brian D. Lynch Debtor's Counsel: Timothy W. Dore, Esq. RYAN SWANSON & CLEVELAND PLLC 1201 3rd Ave Ste 3400 Seattle, WA 98101-3034 Tel: (206) 464-4224 E-mail: dore@ryanlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by William Stegeman, member and manager of Prium Companies LLC. Debtor's List of four Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Davis Construction Trade Debt $100,000 13997 Old Naches Hwy Naches, WA 98937 Green Johnny Trade Debt $23,202 PO Box 48542 Spokane, WA 99208 New Dimensions Trade Debt $13,339 8504 Canyon Rd E Puyallup, WA 98371 North Country Sweeping Trade Debt $3,702 Debtor-affiliates that filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- Prium Kent Retail LLC 10-45715 07/14/10 Prium Lakewood Buildings LLC 10-48621 10/19/10 Prium Meeker Mall LLC 10-45713 07/14/10 CDX GAS: Court Closes Chapter 11 Reorganization Case ---------------------------------------------------- The Hon. Letitia Z. Paul of the U.S. Bankruptcy Court for the Southern District of Texas, in a February 2 court order, entered a final decree closing the Chapter 11 case of CDX Gas, LLC. The effective date of the Debtor's Plan of Reorganization occurred in October 2009. Based in Houston, Texas, CDX Gas LLC -- http://www.cdxgas.com/-- is an independent gas company that explores, develops, and produces onshore North American unconventional natural gas resources located in coal, shale, and tight gas sandstone formations. The Company and 17 of its affiliates filed for Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 08-37922) on December 12, 2008. Four additional affiliates filed voluntary petitions under Chapter 11 on April 1, 2009. CDX Rio, LLC, an entity in which CDX Gas indirectly owns a 90% membership interest, and Arkoma Gathering, LLC, an entity in which CDX Gas owns a 75% membership interest, filed for Chapter 11 protection on April 1, 2009. In its schedules, CDX disclosed total assets of $996.3 million and total debts of $831.3 million. Harry Perrin, Esq., D. Bobbitt Noel, Esq., John E. Mitchell, Esq., and Michaela C. Crocker, Esq., at Vinson Elkins LLP, represented the Debtors in their restructuring effort. Gardere Wynne Sewell LLP, served as conflicts counsel. Epiq Bankruptcy Solutions, LLC, was the claims and noticing agent. The Debtors also hired Ryder Scott Company, L.P. as Petroleum Consultants; Wilhoit & Kaiser as special title examination counsel; Fish & Richardson LLP as Special Intellectual Property Counsel; Deloitte Tax LLP as Tax Consultants; and Jefferies & Company, Inc., as valuation experts. On January 7, 2009, the Office of the United States Trustee informed the Court of its inability to solicit sufficient interest from creditors to form an official committee of unsecured creditors. Plans were confirmed as to CDX Rio on July 10, 2009 and as to the remaining Debtors on September 23, 2009. The plan as to the remaining Debtors provided for dismissal as to several of the Debtors and merger as to several of the other Debtors. The remaining entities are CD Exploration, LLC, CDX Acquisition Company, LLC, and Vitruvian Exploration, LLC. CHOA VISION: Can Continue Using Cash Collateral Until March 31 -------------------------------------------------------------- Choa Vision, LLC, obtained authorization from the U.S. Bankruptcy Court for the Central District of California to continue using until March 31, 2011, the cash collateral of secured creditor 50 Morgan CT, LLC. The Debtor can continue using the cash collateral pursuant to this budget: http://bankrupt.com/misc/ChoaVision_cashcollateral_budget.pdf As adequate protection payments, the Debtor was ordered to pay 50 Morgan $85,000 for January, the sum of $85,000 for February, and the sum of $85,000 for March. All real property tax payments as shown in the Budget are to be made directly to the taxing authority or to a segregated trust account to be held for the benefit of the tax authority until payment. The Debtor will provide evidence of payment to 50 Morgan by the end of each month. The Debtor will provide to the secured creditor each month copies of cash flow income and expense reports, in substantially the same format as the budget. 50 Morgan will be granted replacement liens in the Debtor's postpetition assets to the extent of all cash collateral used, to the same extent, validity and priority as 50 Morgan's prepetition liens; provided that the replacement liens won't extend to avoidance actions. A hearing regarding continued use of cash collateral will be held on March 24, 2011, at 2:00 p.m. About Choa Vision Choa Vision LLC is a Los Angeles, California-based hotel company. It filed for Chapter 11 protection on August 18, 2010 (Bankr. C.D. Calif. Case No. 10-44798). Michael Jay Berger, Esq., at the Law Offices Of Michael Jay Berger, in Beverly Hills, California, serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. CLOVERLEAF ENTERPRISES: Balks at Opposes Landow's Late $12MM Offer ------------------------------------------------------------------ Lindsey Robbins, staff writer at The Gazette, reports that winning bidder Penn National Gaming and the U.S. bankruptcy trustee for Rosecroft Raceway's owner are opposing a losing bidder's request for permission to submit a new $12 million cash offer. As reported in the Feb. 4, 2011 edition of the Troubled Company Reporter, the bankruptcy judge has approved 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. At an auction the week before, Penn emerged as the winning bidder with its $10.25 million hearing. However, the final price rose after Mr. Landow's group came up with a last minute bid for the harness track. According to The Gazette, Landow Partners also asked the judge to reconsider its earlier bid of $11 million, plus $6 million in conditional payments greater than the Penn National bid, if the court doesn't approve its new bid. The Gazette relates that in the new bid, Landow Partners also included an additional $3 million if the harness track gets a state-approved operating bond and $3 million within 90 days of slots or table gambling becoming operational at the track. In its request for reconsideration, Landow Partners said it didn't initially increase its bid at the sale hearing because of a misunderstanding. About Cloverleaf Enterprises Cloverleaf Enterprises Inc. -- http://www.rosecroft.com/-- owned the Rosecroft Raceway, a harness track in Fort Washington, Maryland. The Company filed for Chapter 11 protection (Bankr. D. Md. Case No. 09-20056) on June 3, 2009, represented by Nelson C. Cohen, Esq., at Zuckerman Spaeder LLP in Washington, D.C. The Company estimated $10 million to $50 million in assets and $1 million to $10 million in debts in its Chapter 11 petition. In April 2010, Judge Paul Mannes denied a motion to sell the assets, saying the sale "primarily benefits" the track's sole shareholder. The Company's operations were halted in June 2010. In November 2010, the U.S. Trustee named James J. Murphy to serve as Cloverleaf's Chapter 11 trustee. COLTS RUN: Court to Consider Trustee Appointment on Feb. 17 ----------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois has continued until February 17, 2011, at 10:30 a.m., the hearing on the motion to appoint a Chapter 11 trustee in the case of Colts Run, LLC. As reported by the Troubled Company Reporter on July 2, 2010, secured creditor PNC Bank, National Association, as successor to National City Bank, sought for the appointment of a Chapter 11 trustee, citing that the Debtor (a) failed to pay real estate taxes; (b) withdrew funds from the security deposit accounts; (c) failed to make any payment on account of its indebtedness to PNC from February 1, 2010, through the Petition Date; and (d) made a distribution to holders of equity interests. At the Feb. 17 hearing, the Court will also consider the Debtor's further access to the cash collateral of PNC Bank, and PNC Bank's request for relief from stay on all real and personal property collateral of Debtor. About Colts Run, LLC Lake Forest, Illinois-based Colts Run, LLC, owns and operates a residential apartment project located in Lexington, Kentucky, known as Colts Run Apartments. The Company filed for Chapter 11 bankruptcy protection on April 23, 2010 (Bankr. N.D. Ill. Case No. 10-18071). David K. Welch, Esq., at Crane Heyman Simon Welch & Clar, represents the Debtor in its restructuring effort. The Company estimated its assets and debts at $10 million to $50 million as of the Petition Date. COMPUTER SYSTEMS: Court to Dismiss Chapter 11 Case -------------------------------------------------- The Hon. Randolph Baxter of the U.S. Bankruptcy Court for the Northern District of Ohio has granted, in part, the motion of Daniel M. McDermott, the U.S. Trustee for Region 9, to dismiss Computer Systems Company, Inc., et al.'s Chapter 11 bankruptcy case. The U.S. Trustee said that the Debtor's Chapter 11 bankruptcy case be converted or dismissed, there is no indication that the Debtor can reorganized. The Debtor, according to the U.S. Trustee, has sold its assets and as a result, the Debtor is now in charge of liquidating the estate. "This is a task best performed by an independent experienced trustee. Moreover, professional fees in this case for both Debtor's counsel and creditors' committee counsel will continue if this case remains in Chapter 11," the U.S. Trustee stated. The Debtors are ordered to pay any unpaid U.S. Trustee fees and court costs within 90 days. The Court has ruled that the cases of Computer Systems Company, Inc., and R4, LLC are dismissed provided, however, that this court order is stayed, pending the entry of a final non-appealable order in respect of the application for compensation and reimbursement of expenses filed by Brown, Gibbons, Lang and Company Securities, Inc.. After a ruling upon the application, the U.S. Trustee is authorized to submit a supplemental order dissolving the stay and noting the dismissal of the cases. Strongsville, Ohio-based Computer Systems Co., also known as CSC Group, is a provider of information management software for health-care providers. The Company and its subsidiary, R4, LLC, filed for Chapter 11 bankruptcy on November 13, 2009 (Bankr. N.D. Ohio Case No. 09-20802). Computer Systems said that its assets were $49.1 million and debt was $33.9 million at September 30, 2009. CONSOLIDATED HORTICULTURE: To File Plan After Assets Sale --------------------------------------------------------- Consolidated Horticulture Group LLC, et al., ask the U.S. Bankruptcy Court for the District of Delaware to extend their exclusive period to file a Chapter 11 plan and solicit acceptance of the plan by four months to June 9, 2011 and August 8, 2011, respectively. The Debtors are hopeful that they will be able to file a plan of liquidation after completing the auction and sale process of its assets. Since the commencement of their Chapter 11 cases four months ago, the Debtors have engaged in extensive efforts in marketing their assets in order to conduct an auction and sale of substantially all of their assets. On December 17, 2010, the Court entered an order approving bidding procedures for the sale, scheduling the auction for February 25, 2011, and a hearing to consider the sale for February 28, 2011. About Consolidated Horticulture Irvine, California-based Consolidated Horticulture Group LLC, doing business as Hines Nurseries LLC -- http://www.hineshorticulture.com/-- operates nursery facilities located in Arizona, California, Oregon and Texas. Through its affiliate, the company produces and distributes horticultural products. Black Diamond Capital Management LLC purchased Hines Nurseries Inc. in a bankruptcy sale in January 2009. The resulting reorganization plan, confirmed in January 2009, paid secured creditors in full on their $35.9 million in claims while providing as much as $12 million toward debt owing to suppliers both before and after the bankruptcy filing. The business bought by Black Diamond was renamed to Consolidated Horticulture. Consolidated Horticulture and its affiliates filed for Chapter 11 protection on October 12, 2010 (Bankr. D. Del. Lead Case No. 10-13308). Laura Davis Jones, Esq. and Timothy P. Cairns, Esq. at Pachulski Stang Ziehl & Jones LLP, serve as Delaware counsel to the Debtors. Attorneys at Jones, Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P., serve as bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Lowenstein Sandler PC as counsel and Blank Rome LLP as co-counsel. Consolidated Horticulture estimated $100 million to $500 million in assets and $50 million to $100 million in debts in the Chapter 11 petition. COYOTES HOCKEY: Glendale Plans Bond Sale This Week to Fund Sale --------------------------------------------------------------- Mike Sunnucks at the Phoenix Business Journal reports that the city of Glendale, Arizona, will try to sell bonds next week to help finance the sale of the Phoenix Coyotes from the National Hockey League to Chicago investment broker Matthew Hulsizer. The bond sale comes as Standards & Poors Ratings Services and Moody's Investors Service both downgraded some outlooks and ratings for Glendale, according to the report. S&P changed its Glendale outlook to negative from stable but kept the city's rating at 'AA.' As reported in the Jan. 31, 2011 edition of the Troubled Company Reporter, the city of Glendale is selling $100 million in bonds, the proceeds of which will be transferred to Chicago financier Matthew Hulsizer who has agreed to buy the Phoenix Coyotes and keep the team in Glendale. Glendale hopes to recoup the $100 million in bonds by charging for parking outside the arena. According to the Business Journal, Glendale wants to sell the bonds as part of $197 million, six-year deal to help Hulsizer buy the Coyotes. The NHL owns the team having bought it out of Chapter 11 bankruptcy for $140 million. Mr. Hulsizer wants to buy the team for $160 million to $170 million. About Coyotes Hockey Dewey Ranch Hockey LLC, Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC -- owners and affiliates of the Phoenix Coyotes National Hockey League team -- filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 09-09488) on May 5, 2009. The Debtors are represented by Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, in Phoenix, and estimate their assets and liabilities are between $100 million and $500 million. In the third quarter of 2009, Judge Redfield T. Baum approved the sale of the Phoenix Coyotes to the National Hockey League, which had bought the team to quash a plan by bidder Jim Balsillie's to move the team to Ontario, Canada. Coyotes was sent to Chapter 11 to effectuate a sale by owner Jerry Moyes to Mr. Balsillie. EMMIS COMMUNICATIONS: Alden Seeks to Void $200,000 Loan to CEO -------------------------------------------------------------- In a letter filed with the U.S. Securities and Exchange Commission on February 3, 2011, Alden Global Capital Limited, Alden Global Distressed Opportunities, Master Fund, L.P., and Smith Management LLC asked the Board of Directors of Emmis Communications Corporation to terminate and rescind a $200,000 loan made to a company owned and controlled by Emmis' founder, CEO and Chairman, Jeff Smulyan. On December 27, 2010, Emmis Communications filed a current report on Form 8-K announcing that it entered into an agreement with Bose McKinney & Evans, LLP. and JS Acquisition, LLC, for the purpose of coordinating the prosecution of certain litigation by JSA against Alden relating to the going private transaction in which Emmis, JSA and Alden participated earlier this year. The Alden Entities strongly object to the Company's decision asserting that the Loan clearly violates both the letter of Section 402 of the Sarbanes-Oxley Act and the fundamental policy underlying its enactment -- preventing executives of public corporations from exploiting their control relationships with the board of directors and the company in order to make the company into the lender of last resort for its executives. The Alden Entities seek to recover any proceeds of the Loan that may have been distributed to JS Acquisition. The Alden Entities also seek to require that Mr. Smulyan and any member of the Board who voted in favor of the Loan immediately reimburse Emmis for all attorneys' fees and costs incurred in pursuing, implementing, announcing and rescinding the Loan, including the repayment of all Board fees paid for meetings associated with the Loan transaction and its rescission. The Alden Entities hold 3.32 million common stock representing 9.13% of the shares outstanding. As of January 6, 2010, there were 33,510,830 shares of Class A Common Stock outstanding. About Emmis Headquartered in Indianapolis, Indiana, Emmis Communications Corporation -- http://www.emmis.com/-- owns and operates 22 radio stations serving New York, Los Angeles, Chicago, St. Louis, Austin, Indianapolis, and Terre Haute, as well as national radio networks in Slovakia and Bulgaria. The company also publishes six regional and two specialty magazines. As of November 30, 2010, the Company's balance sheet showed $499.9 million in total assets, $487.4 million in total liabilities, $140.5 million in Series A cumulative convertible preferred stock, a $177.8 million shareholders' deficit, and non- controlling interests of $49.4 million. * * * In November 2010, Moody's Investors Service affirmed the 'Caa2' Corporate Family Rating and 'Caa3' Probability of Default rating for Emmis Communications Corporation, as well as its SGL-4 speculative grade liquidity rating. Operating performance improved with the economic recovery, but absent debt reduction with proceeds from an asset sale or equity infusion Emmis will likely breach its leverage covenant when the covenant suspension period ends for the quarter ending November 30, 2011, in Moody's opinion. Emmis' CFR and PDR incorporate expectations for a covenant breach in November 2011. Moody's considers the Company's capital structure unsustainable, and its operations in the cyclical advertising business magnify this challenge. Furthermore, Emmis relies on two markets, Los Angeles and New York, for approximately 50% of its revenue, although its ownership of stations in top markets including Chicago as well as NY and LA, support the rating. The negative outlook incorporates Moody's expectations that Emmis will not comply with its maximum leverage covenant when effective for the quarter ending November 30, 2011. EVERGREEN ENERGY: Edgehill Partners Discloses 8.3% Equity Stake --------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, Edgehill Partners disclosed that it beneficially owns 2,170,923 shares of common stock of Evergreen Energy Inc. representing 8.3% of the shares outstanding. Other affiliates of Edgehill Partners also disclosed beneficial ownership of shares of the Company: Shares Equity Beneficially Owned Stake ------------------ ------ Edgehill Multi Strategy Master Fund 2,112,923 8.1% William Bradford Todd White 2,170,923 8.3% Jason Mann 2,170,923 8.3% On November 10, 2010 there were 18,888,491 shares of the Company's common stock, $.001 par value, outstanding. About Evergreen Energy Evergreen Energy Inc. has developed two, proprietary, patented, and green technologies: the GreenCert(TM) suite of software and services and K-Fuel(R). GreenCert, which is owned exclusively by Evergreen, is a science-based, scalable family of environmental intelligence solutions that quantify process efficiency and greenhouse gas emissions from energy, industrial and agricultural sources and may be used to create verifiable emission reduction credits. K-Fuel technology significantly improves the performance of low-rank coals, yielding higher efficiency and lowering emissions. The Company's balance sheet as of September 30, 2010, showed $33.93 million in total assets, $45.04 million in total liabilities, $3,000 in temporary equity, and a stockholders' deficit of $11.11 million. Deloitte & Touche LLP, in Denver, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted of the Company's recurring losses from operations and stockholders' deficit. EVERGREEN SOLAR: Debt Exchange Offer Expired Friday --------------------------------------------------- Evergreen Solar Inc. gave noteholders two more days to approve a debt exchange offer after failing to gain the necessary support for the proposal by its self-imposed Wednesday deadline. The Company extended until Friday, Feb. 11, the expiration date for its offers to exchange: (i) an aggregate principal amount of up to $100,000,000 of new 4.0% Convertible Subordinated Additional Cash Notes due 2020, or the new 4% notes, for an aggregate principal amount of up to $200,000,000 of its 4.0% Senior Convertible Notes due 2013, or the existing 4% notes, and (ii) an aggregate principal amount of up to $165,000,000 of new 7.5% Convertible Senior Secured Notes due 2017, or the new 7.5% notes, for an aggregate principal amount of up to $165,000,000 of its 13.0% Convertible Senior Secured Notes due 2015, or the existing 13% notes, and the related consent solicitation. Based on a preliminary count provided to the Company by the exchange agent, as of 11:59 p.m., New York City time, on Feb. 9, holders of approximately $64 million aggregate principal amount of the existing 4% notes (or approximately 26% of the existing 4% notes outstanding) had tendered for exchange, and holders of approximately $79 million aggregate principal amount of the existing 13% notes (or approximately 48% of the existing 13% notes outstanding) had tendered for exchange and had delivered consents to the proposed amendments to the indenture governing the existing 13% notes. At a meeting of the Company's stockholders held Feb. 9, the Company's stockholders approved the specific terms of the proposed exchange offers as required by Nasdaq Marketplace Rule 5635. As such, the Company will either close the current exchange offers on Feb. 11 at 5:00 p.m., New York time, or terminate the offers if their respective conditions are not met. Lazard Capital Markets LLC is serving as the dealer manager for the exchange offers and consent solicitation. The information agent for the exchange offers and consent solicitation is The Proxy Advisory Group, LLC and the exchange agent for the exchange offers and consent solicitation is U.S. Bank National Association. Recapitalization Plan In December, Evergreen Solar announced a comprehensive recapitalization plan that, among others, will substantially reduce the Company's outstanding indebtedness and annual interest expense. The plan is comprised of these key elements: -- Exchange offers and a consent solicitation; -- Raising additional capital by seeking to sell up to $40,000,000 aggregate principal amount of Evergreen Solar's new 4% Convertible Subordinated Additional Cash Notes due 2020; -- Implementing the 1-for-6 reverse stock split previously approved by Evergreen Solar's stockholders; and -- Increasing Evergreen Solar's authorized shares of common stock from 120,000,000 to 240,000,000 shares (after giving effect to the reverse stock split), in order to ensure that the company has sufficient shares available for future issuances. On January 11, 2011, Evergreen Solar said it intends to shut down operations at its Devens manufacturing facility by the end of the first quarter of 2011 to better position the Company to pursue its industry standard size wafer strategy and preserve the Company's liquidity. Lazard Capital Markets LLC serves as the dealer manager for the exchange offers and consent solicitation and sole bookrunner for the new money offering. The information agent for the exchange offers and consent solicitation is The Proxy Advisory Group, LLC and the exchange agent for the exchange offers and consent solicitation is U.S. Bank National Association. About Evergreen Solar Marlboro, Massachusetts, December 6, 2010 -- Evergreen Solar, Inc. (NasdaqGM: ESLR) -- http://www.evergreensolar.com/-- develops, manufactures and markets String Ribbon(R) solar power products using its proprietary, low-cost silicon wafer technology. The Company's balance sheet at Oct. 2, 2010, showed $835.05 million in total assets, $486.2 million in liabilities and stockholders' equity of $348.8 million. FIRST METALS: Noteholders OK Sale of Fabie & Magusi Properties -------------------------------------------------------------- First Metals Inc disclosed that holders of its outstanding 5% secured notes have approved a resolution directing the company to proceed with the sales of the Corporation's Fabie Bay and Magusi River properties in Quebec as well as certain heavy equipment. Pursuant to the resolution the net proceeds from such sales will be paid to the note holders on a pro rata basis and following such payment the noteholders will release the Corporation from any remaining liabilities under the notes. The Corporation has been in negotiations for the sales of these assets on behalf of the noteholders and expects to enter definitive agreements in respect thereof in the near future. Michael Churchill, the Corporation's President and Chief Executive Officer commented, "I believe the results of the noteholder vote underscores the effort we've put into the restructuring process to maximize recoveries for the note holders and shareholders and generally balance everyone's interests in light of fact the Corporation has been in default of its notes for several months. The alternative was a bankruptcy and liquidation which we believe would have resulted in less recoveries for the noteholders and no chance of any recovery for holders of common shares." About FMA First Metals Inc. is a resource company with two main Zinc-Copper deposits, Fabie Bay and Magusi River. Fabie Bay was producing until December 2008 when production was suspended. The company filed a proposal under Part III of the Bankruptcy and Insolvency Act in April 2009. The company received approval for is proposal under Part III of the Bankruptcy and Insolvency Act in June 2009. Richard Williams and Jay Richardson who had held their respective positions of President-CEO and Secretary-Treasurer since July 22nd 2008, were terminated by the board effective January 8th, 2010. Michael Churchill was installed by the board January 8th, 2010 as President and CEO with a specific mandate to assess and report on the financial and operational status of FMA, formulate a new operational and reorganization plan, and then implement the plan. FRED NEAL: Barred From Filing Bogus Debt Instruments ---------------------------------------------------- United States of America, v. Fred and Doris-June Neal, Case No. 10-cv-03029 (W.D. Ark.), seeks declaratory and injunctive relief against Fred and Doris-June Neal for the filing of bogus debt instruments and fake legal documents against federal officials and employees. The U.S. government asked the Court to declare the Neals' maritime liens, bonded promissory notes, and certificates of non-performance null, void, and without legal effect. It also seeks a permanent injunction under 26 U.S.C. Sec. 7402 to prevent the Neals from further violating the Internal Revenue Code and from causing additional specified harm to federal employees, judicial officials, and the United States. District Judge Nanette K. Laughrey granted the Government's motion for summary judgment. By failing to respond to the Motion, the Neals have admitted that the liens, notes, and certificates of non-performance are all fraudulent. Moreover, each of the 11 individuals against whom the Neals have filed maritime liens and the individuals named by the Neals as co-fiduciaries on their bonded promissory notes have had no personal or private relationship or contacts of any nature with Defendants Fred or Doris-June Neal. The only contact which these individuals have had with the Neals has arisen out of the substance and proceedings of the Arkansas case, the Texas case, and the Neals' bankruptcy proceedings. Several of the notes and liens were filed by the Neals in response to court proceedings in both Arkansas and Texas. A copy of the District Court's order is available at http://is.gd/8ihfHLfrom Leagle.com. The Neals filed for Chapter 13 bankruptcy (Bankr. W.D. Ark. Case No. 09-70014) early in 2009. On March 18, 2009, the bankruptcy court dismissed the Chapter 13 proceeding because the Neals did not satisfy the eligibility requirements. On June 24, 2009, the Neals filed for Chapter 11 bankruptcy with the same bankruptcy court (Bankr. W.D. Ark. Case No. 09-73097), and listed the liens among their assets. The United States moved to dismiss the Neals' Chapter 11 proceeding on the ground that the Neals filed for bankruptcy solely to evade collection of their federal income tax liabilities. On February 5, 2010, Judge Ben T. Barry dismissed the bankruptcy proceeding. He found that the proceeding was based on a "faulty premise." GAS CITY: Seeks May 24 Extension of Exclusive Plan Filing Period ---------------------------------------------------------------- Judge Eugene Wedoff will hold a hearing on February 15, 2011, at 10:00 a.m., in Chicago, to consider Gas City Ltd. and its affiliates' request for a 90-day extension of their exclusive periods to file a chapter 11 plan or plans of reorganization and to solicit acceptances of the plan: -- through and including May 24, 2011, for the Exclusive Plan Filing Period; and -- through and including July 22, 2011, for the Exclusive Solicitation Period. The Debtors told the Court that since the Petition Date, they have been operating their businesses and, at the same time, working toward a going concern sale of substantially all assets. The Debtors and their professional advisors have devoted a substantial amount of time and resources to, among other things, negotiating cash collateral and sale procedures issues, negotiating a global settlement with their creditors regarding the allocation and distribution of sale proceeds, filing the Debtors' schedules of assets and liabilities and statements of financial affairs, and conducting the marketing and going concern sale process. According to the Debtors, because of the large size of their business and the complexity of the sale process, they require additional time to complete the sale process and determine the most beneficial conclusion and exit from bankruptcy for their estates and creditors, based in part on the sale results. The Debtors said an extension of their exclusive periods to file and solicit acceptances to a chapter 11 plan is necessary to prevent the distraction and additional strain on the Debtors' limited resources that would be caused if a competing chapter 11 plan were to be filed while the Debtors are trying to maximize value for all creditors through the sale process. About Gas City Gas City Ltd. -- http://www.gascity.net/-- based in Frankfort, Ill., is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City sought Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 10-47879) on Oct. 26, 2010, estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, the William J. McEnery Revocable Trust dated Apr. 22, 1993, filed a separate Chapter 11 petition (Bankr. N.D. Ill. Case No. 10-47895). Paul V. Possinger, Esq., at Proskauer Rose LLP, and Daniel A. Zazove, Esq., at Perkins Coie LLP, represent the Debtors. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. The Official Committee of Unsecured Creditors has tapped Pachulski Stang Ziehl & Jones LLP and Levenfeld Pearlstein, LLC, as co-counsel and Mesirow Financial Consulting, LLC, as financial advisors. GENERAL MOTORS: Claims Settlement Total $51.1 Mil. in 4th Quarter ----------------------------------------------------------------- Motors Liquidation Co. and its units reported to the Court that during the fiscal quarter ending December 31, 2010, they entered into 73 settlements with claimants pursuant to the Claims Settlement Procedures Order. Under the Settlements, the Claimants received settlement amounts totaling $51,161,890 with respect to their allowed general unsecured claims. A schedule of the Claim Settlements is available for free at http://bankrupt.com/misc/gm_4thQClaimsSettlement.pdf About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Opposes TP Lenders Plea for Valuation Hearing ------------------------------------------------------------- Wells Fargo Bank Northwest, N.A., as agent, on behalf of certain lenders known as "TPC Lenders" previously filed an objection to the motion selling all of General Motors' assets to preserve the lenders' rights and interests to two facilities of General Motors Corporation -- a transmission manufacturing plant in White Marsh, Maryland and a distribution center in Memphis, Tennessee -- the TPC Property. Steven M. Bierman, Esq., at Sidley & Austin LLP, in New York -- sbierman@sidley.com -- says that since entry of the Sale Order, the TPC Lenders have commissioned appraisals of the Facilities and have engaged in discussions with New GM in an effort reach agreement upon the value of the Facilities. However, those discussions have not been successful in reaching an agreed- upon value for the Facilities, he points out. By this motion, the Agent, on behalf of the TPC Lenders, asks the Court to: (i) initiate valuation proceedings for the Facilities as contemplated by the 363 Sale Order; and (ii) establish an appropriate schedule with respect to these valuation proceedings. The TPC Lenders are Norddeutsche Landesbank Girozentrale (New York Branch), as administrator; and Hannover Funding Company, and Deutsche Bank, AG, New York Branch, HSBC Bank USA, ABN AMRO Bank N.V., Royal Bank of Canada, Bank of America, N.A., Citicorp USA, Inc., Merrill Lynch Bank USA, Morgan Stanley Bank, as purchasers. While the Debtors understand the requirements of the Sale Order, the Debtors are concerned about the timing of the TPC Lenders' request for a valuation hearing at this time, counsel to the Debtors, Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, in New York tells Judge Gerber. "It is not appropriate for the Debtors to be required to engage in discovery, briefing and a contested valuation hearing while simultaneously prosecuting confirmation of their Amended Joint Chapter 11 Plan of Reorganization," Mr. Smolinsky stresses. Since Wells Fargo Bank Northwest, N.A., as agent to the TPC Lenders, filed the Valuation Motion over a year after entry of the Sale Order, it is hard to imagine that valuation of a transmission manufacturing plant in White Marsh, Maryland and a distribution center in Memphis, Tennessee -- the "TPC Property" - - now is a particularly pressing matter, Mr. Smolinsky contends. On the effective date of the Plan, there will be a change of control wherein responsibility for this matter will be transferred to the GUC Trust, he explains. He says the Debtors currently intend to effectuate their Plan in March 2011. The TPC Lenders propose to complete discovery and briefing in late March orearly April with an evidentiary hearing shortly thereafter. Against this backdrop, it would be highly prejudicial to the GUC Trust Administrator to be required to direct and participate in a valuation proceeding immediately after assumption of its responsibilities without a sufficient opportunity to familiarize itself with this matter, he argues. Mr. Smolinsky also points out that the Debtors' participation in this dispute is not entirely necessary. Indeed, the Debtors are only responsible for satisfaction of the TPC Lenders' secured claim out of General Motors LLC {"New GM") stock in amounts exceeding $90.7 million, he asserts. It would also not surprise the Debtors to learn that New GM and the TPC Lenders agree that the value of the TPC Property is less than $90.7 million, he says. The Debtors thus urge the TPC Lenders to concede this fact, in which case it would not be necessary for the Debtors to participate in the valuation trial and the timing concerns would no longer be an issue. To the extent the TPC Lenders do not make this concession, the Debtors support the proposal of New GM to bifurcate this matter by first determining the threshold legal issue of which valuation methodology to employ and delaying any scheduling of a valuation hearing until after the effective date of the Plan. In a separate response, New GM insists that the language of the Sale Order is clear; the "fair market value" method -- and no other valuation standard -- is to be used to value the TPC Property. New GM also disputes that TPC Lenders' position that the separate and distinct "value in use" method should be considered to value the TPC Property. Counsel to New GM, Arthur Steinberg, Esq., at King & Spalding LLP, in New York, argues that not only is it contrary to the agreement reflected in the Sale Order, but using a valuation methodology other than "fair market value" is inconsistent with a sale transaction, which is what occurred in the bankruptcy case. If the TPC Lenders' "value in use" method is used, the gap between New GM's value and the TPC Lenders' value grows by 300%, he stresses. Mr. Steinberg also avers that a comprehensive schedule for determining the value of the TPC Property, including establishing a briefing schedule, discovery deadlines and an evidentiary hearing date, would be an inefficient use of both the parties' and the Court's time and resources. Instead, New GM proposes that it would be more appropriate, efficient and less expensive to establish a briefing schedule regarding the threshold valuation methodology issue. New GM further believes that the plain language of the Sale Order should govern and that no discovery is needed to resolve this issue. If the TPC Lenders believe that discovery is needed with respect to the valuation methodology issue and the Court agrees, an appropriate schedule can be negotiated between the parties, he adds. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: To Expand Financial Unit's Operations ----------------------------------------------------- General Motors Company unveils plans to expand its auto lending arm, GM Financial Company, Inc., Sharon Terlep and Aparajita Saha- Bubna of The Wall Street Journal wrote. GM spun-off Ally Financial Inc., formerly GMAC, still finances GM's customers and dealers, The Journal noted. Just last year, GM started GM Financial to gain more control over customer financing, a move that raised tensions between Ally and its former parent, The Journal related. GM announced February 3, 2011 that GM Financial will begin lending to customers in Canada, a market handled by Ally, the report related. GM is also contemplating entry into the business of lending to auto dealers, the report stated. According to the report, Ally holds 80% of lending to GM dealers. GM Treasurer Dan Ammann told The Journal that the recent development aims to boost sales for the automaker by making credit more available to car buyers. GM has also disclosed that GM Financial plans to move into the business of leasing while doubling loan volumes to car buyers with lower credit ratings, which has been a profitable venture for the finance company, the report noted. The report observed that the recent moves come as both GM and Ally face pressure from the U.S. Government and Wall Street to end uncertainty as to how the two companies will work together. The Journal mentioned that Ally is preparing for an initial public offering this year and that its relationship with GM remains a key concern among the firms handling the IPO, according to people privy to the matter. GM has recently revisited the idea of buying back its former financial unit, however, Mr. Amman declined to elaborate on the automaker's dealing with the former GMAC, The Journal disclosed. GM and Ally will continue to have a relationship but, over time, he expects each company to be less reliant on the other, Mr. Amman told the Journal. Mr. Amman also disclosed that GM's sales received an indirect boost from GM Financial because the new lender has put pressure on existing firms, including Ally, to step up with more competitive offers for customers, The Journal added. In a related development, a unit of GM Financial entered into a $600-million loan agreement with Deutsche Bank AG, New York Branch and JPMorgan Chase Bank, N.A. as administrative agents, according to the company's regulatory filing with the U.S. Securities and Exchange Commission on February 4, 2011. AmeriCredit Financial Services, Inc. and the lenders will establish the GMF Leasing Warehouse Trust revolving credit facility under which AmeriCredit may borrow up to $600 million backed by a 2011 A-Exchange Note, secured by certain automobile lease agreements and lease vehicles by ACAR Leasing Ltd., a subsidiary of AmeriCredit. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Wins Nod of Stipulation Allowing LDTC Claims ------------------------------------------------------------- Motors Liquidation Co. and Law Debenture Trust Company of New York, as successor indenture, sought and obtained the Bankruptcy Court's approval of a stipulation for the allowance of certain claims totaling $183,990,399. The Debtors agree that with respect to amounts of principal plus interest due under certain indentures, the Indenture Trustee will receive, on behalf of itself and the holders of the bonds issued under each of the Indentures, an allowed general unsecured, nonpriority claim against Motors Liquidation Company, to be satisfied in accordance with the any Chapter 11 plan to be confirmed in these Chapter 11 Cases. The Debt Claims to be allowed are: Claim No. Applicable Indenture Claim Amt. --------- -------------------- ---------- 60006 1999 Morraine Indenture $10,282,500 60007 1994 Morraine Indenture $12,851,562 60008 1984 Indianapolis Indenture $1,413,125 60009 1995 Michigan Indenture $59,711,400 60010 2002 Ohio Solid Waste Indenture $47,449,000 60011 2002 Ohio Pollution Indenture $20,321,812 60012 2002 Fort Wayne Indenture $31,961,000 The Indenture Trustee will issue a notice to The Depository Trust Company notifying the Bondholders: (a) of the entry of this stipulation allowing the Debt Claims; and (b) that any subsequent claims objections filed by the Debtors seeking to disallow claims filed by the Bondholders solely on the grounds that the Bondholder Claims are duplicative of the Debt Claims allowed under the Parties' Stipulation will not impair those Bondholders' entitlement to share in plan distributions on account of the Debt Claims in accordance with the applicable Indenture. The Indenture Trustee agrees that it will not object to the Debtors' filing of the Claims Objections solely on the grounds that the Bondholder Claims to which the Claims Objections have been filed are duplicative of the Debt Claims allowed pursuant to the Parties' Stipulation. The Debtors agree to pay the Indenture Trustee its fees and expenses as set forth in their Amended Joint Chapter 11 Plan of Reorganization. With respect to the Fees and Expenses incurred by the Indenture Trustee under the Indentures before the Petition Date, the Indenture Trustee will receive an allowed claim for $851. To the extent the Fees and Expenses are not paid in full, in cash, in accordance with the Plan: (a) the amount of those Fees and Expenses that remain unpaid will constitute an allowed general unsecured nonpriority claim against MLC held by the Indenture Trustee, to be satisfied in accordance with the Plan; and (b) pursuant to the applicable Indentures, the Indenture Trustee will retain a charging lien with respect to the Fees and Expenses on all assets or money held or collected by the Indenture Trustee on account of the Debt Claims or as otherwise charged pursuant to the applicable Indenture. Nothing in the Parties' Stipulation will preclude the Indenture Trustee from seeking: (a) approval from the Court to treat any Fees and Expenses which have not been paid in full, in cash, as administrative expenses under Section 503(b) of the Bankruptcy Code; and (b) in the event the Debtors' estates are determined at the time of confirmation of the Plan, the payment of interest accrued on the bonds issued pursuant to the Indentures after the Petition Date. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GLAZIER GROUP: Committee Taps SilvermanAcampora LLP as Counsel -------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 case of The Glazier Group, Inc., asks the U.S. Bankruptcy Court for the Southern District of New York for permission to retain SilvermanAcampora LLP as its counsel. SilvermanAcampora will be representing the Committee in the Debtor's Chapter 11 proceedings. The Committee will present for signature the proposed order to the Hon. Allan L. Gropper on February 14, 2011, at 12:00 noon. The firm can be reached at: SILVERMANACAMPORA LLP Ronald J. Friedman, Esq. Katina Brountzas, Esq. Sheryl P. Busell, Esq. 100 Jericho Quadrangle, Suite 300 Jericho, New York 11753 Tel: (516) 479-6300 About The Glazier Group New York-based The Glazier Group, Inc., filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. S.D.N.Y. Case No. 10-16099). Frederick E. Schmidt, Esq., Joshua Joseph Angel, Esq., and Seth F. Kornbluth, Esq., at Herrick, Feinstein LLP, represent the Debtor in its restructuring effort. The Company disclosed assets of $15.2 million and liabilities of $26.8 million as of the Petition Date. GLAZIER GROUP: Court Approves Herrick Feinstein as Bankr. Counsel ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York authorized Glazier Group Inc. to employ Herrick Feinstein LLP as its bankruptcy counsel. The firm is expected to: a) advise the Debtor with respect to its powers and duties as debtor and debtor-in-possession in the continued management and operation of its business and properties; b) attend meetings and negotiate with representatives of creditors and other parties in interest and advise and consult on the conduct of the bankruptcy case, including all of the legal and administrative requirements of operating in chapter 11; c) take all necessary actions to protect and preserve the Debtor's estate, including the prosecution of actions on its behalf, the defense of any actions commenced against its estate; negotiations concerning all litigation in which the Debtor may be involved and objections to claims filed against the estate; d) prepare on behalf of the Debtor all motions, applications, answers, orders, reports and papers necessary to the administration of the estate; and e) negotiate and prepare on the Debtor's behalf plane(s) of reorganization, disclosure statement(s) and all related agreements and documents and take any necessary action on behalf of the Debtor to obtain confirmation of such plane(s). The firm will charge the Debtor based on the hourly rates of its professionals: Designations Hourly Rates ------------ ------------ Members & Counsel $460-$910 Associates $275-$535 Legal Assistants $170-$340 The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. New York-based The Glazier Group, Inc., filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. S.D.N.Y. Case No. 10-16099). Frederick E. Schmidt, Esq., Joshua Joseph Angel, Esq., and Seth F. Kornbluth, Esq., at Herrick, Feinstein LLP, assist the Debtor in its restructuring effort. The Company disclosed assets of $15.2 million and liabilities of $26.8 million as of the Petition Date. GLOBAL GENERAL: Recognition Hearing Scheduled for March 4, 2011 --------------------------------------------------------------- The Honorable Robert D. Drain will convene a hearing at 10:00 a.m. on March 4, 2011, in White Plains, N.Y., to consider entry of an order recognizing the proceedings before the High Court of Justice of England and Wales as the "foreign main proceeding," and giving full force and effect in the United States to the Scheme of Arrangement proposed by Global General and Reinsurance Company Limited and sanctioned by the High Court. The proposed scheme, which was sanctioned by the British court on Jan. 28, "addresses and resolves all of the company's existing and future liabilities," excluding certain liabilities, such as those covered in prior schemes, Simon Brincklow, who serves as the foreign representative for Global General, said. Global General has ceased underwriting and went into run-off in October 2002. When insurance or reinsurance companies enter into run-off, they cease writing new business and seek to determine, settle and pay all liquidated claims of their insureds either as they arise, or, if possible, before they arise. Typically, a run- off of an insurance company will take 20 or more years to complete. About GLOBAL General Headquartered in London, GLOBAL General and Reinsurance Company Limited is an insurance and reinsurance company formed in April 16, 1940. Between 1940 and 2002, GLOBAL General wrote a wide array of reinsurance business in England. The reinsurance portfolio was underwritten in London, predominantly from the early 1950's to the early 1980's. The portfolio was mostly accepted through placements made by London market brokers. The portfolio consists of facultative and treaty reinsurance, both proportional and non-proportional, covering various classes including, but not limited to, marine, non-marine and aviation. Simon Brincklow filed a chapter 15 petition for GLOBAL General and Reinsurance Company Limited (Bankr. S.D.N.Y. Case No. 11-10327) on Jan. 31, 2011. Two schemes for different lines of General Global's insurance business already have been recognized under Chapter 15. Thomas Klaus Freudenstein, as foreign representative of the two Scheme Companies, filed voluntary Chapter 15 petitions for GLOBAL General and its wholly owned subsidiary GLOBALE Ruckversicherrungs-AG (Bankr. S.D.N.Y. Case Nos. 08-14939 and 08-14940) on December 10, 2008, estimating assets and debts of more than US$100 million in the petition. Howard Seife, Esq., and Francisco Vazquez, Esq., at Chadbourne & Parke LLP, represent the foreign representatives in all three Chapter 15 proceedings. GLOBAL SHIP: Pine River Equity Stake Down to 0.1% ------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, each of Bryan Taylor, Pine River Capital Management L.P. and Nisswa Acquisition Master Fund Ltd. disclosed beneficial ownership of 600 shares of common stock of the company representing 0.1% of the shares outstanding. The Company had 46,830,467 Class A Common Shares, par value of $0.01 per share and 7,405,956 Class B Common Shares, par value of $0.01 per share outstanding as of December 31, 2009. About Global Ship Lease London-based Global Ship Lease (NYSE: GSL, GSL.U and GSL.WS) -- http://www.globalshiplease.com/-- is a containership charter owner. Incorporated in the Marshall Islands, Global Ship Lease commenced operations in December 2007 with a business of owning and chartering out containerships under long-term, fixed rate charters to world class container liner companies. Global Ship Lease owns 17 vessels with a total capacity of 66,297 TEU with a weighted average age at June 30, 2010, of 6.3 years. All of the current vessels are fixed on long-term charters to CMA CGM with an average remaining term of 8.6 years. The Company has contracts in place to purchase two 4,250 TEU newbuildings from German interests for approximately $77 million each that are scheduled to be delivered in the fourth quarter of 2010. The Company also has agreements to charter out these newbuildings to Zim Integrated Shipping Services Limited for seven or eight years at charterer's option. The Company's balance sheet at June 30, 2010, showed $1.008 billion in total assets, $681.7 million in total liabilities, and stockholders' equity of $326.5 million. As reported in the Troubled Company Reporter on May 25, 2010, PricewaterhouseCoopers expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for 2009. The independent auditors noted of the uncertainty related to the financial situation of the Company's charterer, CMA CGM. "If CMA CGM is unable to accomplish a financial restructuring and ceases doing business or otherwise fails to perform its obligations under the Company's charters, Global Ship Lease's business, financial position and results of operations would be materially adversely affected as it is probable that, should the Company be able to find replacement charters, these would be at significantly lower daily rates and for shorter durations than currently in place. In this situation there would be significant uncertainty about the Company's ability to continue as a going concern." GREEN VALLEY: Creditors' Lawyer Can Represent Ch. 11 Trustee ------------------------------------------------------------ Bankruptcy Judge Letitia Z. Paul authorized the Chapter 11 trustee of Green Valley Growers, Inc., to employ Annie E. Catmull, Esq., and the law firm of Hoover Slovacek, LLP, as his counsel to assist the trustee with recovery of transfers to or for the benefit of: a. Crosby State Bank; b. MetLife Group, Inc.; c. Houston Plants & Garden World and/or Jonelle Massey; d. Ray Smith; e. OTWM; f. Wayne Massey; and g. Travis Massey. Ms. Catmull used to lead a team of lawyers at Walker Wilcox & Matousek LLP as counsel to the Official Committee of Unsecured in the Green Valley case, and represented the Committee in its (i) objection to the Debtor's use of cash collateral, (ii) objection to employment of the Debtor's counsel, (iii) motion to convert the case to Chapter 7, (iv) objection to the Debtor's motion to pay what it alleged to be the prepetition claim of MetLife, and (v) motion to appoint a trustee. Ms. Catmull also filed, on behalf of the Committee, notices of Bankruptcy Rule 2004 examinations of the Debtor, Liberty Mutual Ins. Group, MetLife, Great American Insurance Agency, Inc., Capital One, N.A., Fidelity National Title Ins. Co., Enterprise Bank, and Crosby State Bank. In January 2010, Ms. Catmull left Walker Wilcox and joined Hoover Slovacek after notifying the Committee members that she was switching law firms. The notice letter contains language presented as a directive from the Committee chairman to transfer "the Committee's pending and active files relating to the bankruptcy case of" the Debtor to Hoover Slovacek. The directive was signed by the Committee chairman, Andrew Stavrou. Walker Wilcox filed a final fee application, which was granted, by order entered on February 3, 2011. Ms. Catmull filed, on behalf of Hoover Slovacek, a supplemental unsworn declaration under penalty of perjury stating that the Committee members furnished her no information relating to the contemplated litigation, and that the Committee members have consented to her employment as counsel for the Chapter 11 Trustee. There has been no objection by a creditor or the United States Trustee. However, the Court raised, sua sponte, the question of whether Ms. Catmull's representation of the Chapter 11 Trustee after having represented the Committee violates the Texas Disciplinary Rules of Professional Conduct. According to Judge Paul, the Court is satisfied, based on Ms. Catmull's supplemental declaration, that she has not received confidential information of the Committee and its members, and that she has obtained the consent of the Committee members for representation of the Chapter 11 Trustee. A copy of Judge Paul's February 9, 2011 Memorandum Opinion is available at http://is.gd/mrBgg6from Leagle.com. About Green Valley Growers Headquartered in Willis, Texas, Green Valley Growers, Inc. -- http://www.greenvalleygrowers.net/-- is a wholesale grower of blooming tropical, palms, perennials, crape myrtles, ferns, grasses, trees, ground covers, topiaries, and ornamental shrubs. The Debtor filed for Chapter 11 protection on March 9, 2009, (Bankr. S.D. Tex. Case No. 09-31630). Alan D. Bynum, Esq. at Rolston & Bynum, represents the Debtor in its restructuring efforts. The Debtor disclosed total assets of $18.6 million and total debts of $20.7 million as of the Chapter 11 filing. GREENWICH SENTRY: Files Schedules of Assets and Liabilities ----------------------------------------------------------- Greenwich Sentry, L.P., filed with the U.S. Bankruptcy Court for the Southern District of New York its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $317,073,770 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $0 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $206,337,344 ----------- ------------ TOTAL $317,073,770 $206,337,244 About Greenwich Sentry Liquidators of Fairfield Sentry Limited, filed a Chapter 15 petition for Fairfield in June 2010 (Bankr. S.D.N.Y. Case No. 10- 13164). In July 2010, Kenneth Krys and Christopher Stride of Krys & Associates (BVI) Limited, the liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited obtained cross-border recognition as foreign main proceedings by the U.S. Bankruptcy Court of the funds' insolvency proceedings, pending in the British Virgin Islands. The liquidators are represented in the U.S. by Brown Rudnick LLP. Fairfield Sentry Limited was the largest "feeder fund" to Bernard L. Madoff Investment Securities LLC, and invested approximately 95% of its assets with BLMIS. BLMIS was placed into liquidation proceedings in the United States in December 2008, after it was revealed that Bernard Madoff operated BLMIS as a Ponzi scheme for many years. Fairfield Sigma Limited and Fairfield Lambda Limited were both feeder funds of Fairfield Sentry Limited, and invested all of their assets with Fairfield Sentry Limited. Greenwich Sentry, L.P., and an affiliate filed for Chapter 11 protection on November 19, 2010 (Bankr. S.D.N.Y. Case No. 10-16229) hoping to settle lawsuits filed against it in connection with its investments with Bernard L. Madoff. Paul R. DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP, in New York, represents the Debtors in the Chapter 11 cases. Bernard L. Madoff was charged by the Securities and Exchange Commission in December 2008 of orchestrating the largest Ponzi scheme in history, with losses topping US$50 billion. In March 2009, Madoff pleaded guilty to 11 federal crimes and admitted to turning his wealth management business into a Ponzi scheme. A trustee was appointed to liquidate and has been filing clawback suits against investors who withdrew phony profits from Madoff. On May 18, 2009, Irving H. Picard, the trustee liquidating the estate of Mr. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC, filed a lawsuit against Fairfield Sentry and Greenwich, seeking the return of $3.55 billion that Fairfield withdrew from Madoff during the period from 2002 to Madoff's arrest in December 2008. Since 1995, the Fairfield funds invested about $4.5 billion with BLMIS. Mr. Picard claims that Fairfield knew or should have known about the fraud give that it received from BLMIS unrealistically high and consistent annual returns of between 10% and 21% in contrast to the vastly larger fluctuations in the S&P 100 Index. GSI GROUP: Robert Buckley to Become Chief Financial Officer ----------------------------------------------------------- Robert Buckley has agreed to join GSI Group Inc. as Chief Financial Officer. After a brief transition period, during which he will serve in an advisory capacity, Mr. Buckley will become GSI's Chief Financial Officer by early April 2011. Mr. Buckley will succeed Glenn Davis, who has served as the Company's principal financial officer since April 2010. In his capacity as Chief Financial Officer, Mr. Buckley will provide direction for all financial matters related to GSI. "I am delighted that Robert will join my team as Chief Financial Officer," said John Roush, GSI Group's Chief Executive Officer. "I have known Robert for over 10 years, and worked very closely with him during my time at PerkinElmer. I am very happy to have him join the GSI team and help to lead the company forward in the coming years. I would also like to thank Glenn Davis for his dedication and contributions to GSI during the past two years. Glenn successfully steered the Company's financial reporting through a very difficult period. We are grateful for his efforts," added Mr. Roush. Mr. Buckley joins GSI after a successful 10-year career with PerkinElmer, Inc., where he served in several financial positions of increasing responsibility. In 2005, he was named chief financial officer and controller of PerkinElmer's operations in Asia; and most recently served as vice president and chief financial officer of PerkinElmer's $1 billion Environmental Health business. Prior to joining PerkinElmer, Mr. Buckley held several management positions with Honeywell International, Inc. and was an advisor at Georgeson & Company, Inc. Mr. Buckley holds a Bachelor of Arts degree in finance from Manhattanville College and a Master of Business Administration from University of California, Los Angeles (UCLA) Anderson School of Management. About GSI Group Inc. Headquartered in Bedford, Massachusetts, GSI Group Inc. -- http://www.gsig.com/-- supplies precision technology to the global medical, electronics, and industrial markets and semiconductor systems. GSI Group Inc.'s common shares are quoted on Pink Sheets OTC Markets Inc. (LASR.PK). GSI Group together with two of its subsidiaries filed for Chapter 11 protection on Nov. 20, 2009 (Bankr. D. Del. Lead Case No. 09-14110). William R. Baldiga, Esq., at Brown Rudnick LLP, represented the Debtors as lead counsel. Mark Minuti, Esq., at Saul Ewing LLP, represented the Debtors as its local counsel. On July 23, 2010, the Debtors consummated their reorganization through a series of transactions contemplated by a Chapter 11 plan. The Company's shareholders prior to the emergence from bankruptcy retained approximately 86.1% of its capital stock following emergence. * * * In November 2010, Standard & Poor's Ratings Services said that it has affirmed its ratings, including the 'B' corporate credit rating, on Assumption, Ill.-based GSI Group LLC. At the same time, S&P revised the outlook to stable from negative. S&P said the ratings on GSI reflect the company's highly leveraged financial profile, which more than offsets its weak business risk profile. GSI operates in cyclical and competitive niche agricultural equipment markets and faces raw material cost volatility. The company's leading position in its niche markets partially offsets these factors. S&P expects its operating performance to continue to recover in 2011, primarily on better conditions in its end markets. HANMI FINANCIAL: BlackRock Discloses 5.70% Equity Stake ------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, BlackRock, Inc. disclosed that it beneficially owns 8,622,795 shares of common stock of Hanmi Financial Corp representing 5.70% of the shares outstanding. As of October 29, 2010, there were 151,198,390 outstanding shares of the Company's Common Stock. About Hanmi Financial Headquartered in Los Angeles, California, Hanmi Financial Corp. (Nasdaq: HAFC) -- http://www.hanmi.com/-- is the holding company for Hanmi Bank, a state chartered bank with headquarters located at 3660 Wilshire Boulevard, Penthouse Suite A, in Los Angeles. Hanmi Bank provides services to the multi-ethnic communities of California, with 27 full-service offices in Los Angeles, Orange, San Bernardino, San Francisco, Santa Clara and San Diego counties, and a loan production office in Washington State. The Company's balance sheet at December 31, 2010 showed $2.90 billion in total assets, $2.73 billion in total liabilities and $173.25 million in stockholders' equity. As reported in the Troubled Company Reporter on March 17, 2010, KPMG LLP, in Los Angeles, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted the Company and its wholly-owned subsidiary Hanmi Bank, are currently operating under a formal supervisory agreement with the Federal Reserve Bank of San Francisco and the California Department of Financial Institutions, which restricts certain operations of the Company and requires the Company to, among other things, increase contributed equity capital at Hanmi Bank by $100 million by July 31, 2010, and achieve specified capital ratios by July 31, 2010, and December 31, 2010. HERCULES OFFSHORE: BlackRock Holds 6.23% Equity Stake ----------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, BlackRock, Inc. disclosed that it beneficially owns 7,152,418 shares of common stock of Hercules Offshore, Inc. representing 6.23% of the shares outstanding. As of October 21, 2010, there were 114,784,098 shares of common stock outstanding of the Company. About Hercules Offshore Hercules Offshore, Inc. (NASDAQ: HERO) -- http://www.herculesoffshore.com/-- provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the United States, Gulf of Mexico and internationally. The Company provides these services to integrated energy companies, independent oil and natural gas operators and national oil companies. The Company operates in six business segments: Domestic Offshore, International Offshore, Inland, Domestic Liftboats, International Liftboats and Delta Towing. The Troubled Company Reporter said on November 17, 2010, Moody's Investors Service downgraded the Corporate Family Rating of Hercules Offshore Inc. and the Probability of Default Rating to 'Caa1' from 'B2'. Moody's also downgraded Hercules' 10.5% senior secured notes due 2017, its senior secured revolving credit facility due 2012, and its senior secured term loan B due 2013, all to Caa1 with LGD3, 45%. The outlook remains negative. "The inability of Hercules to generate meaningful free cash flow despite limited reinvestment in its aging fleet of rigs is cause for concern," commented Stuart Miller, Moody's Senior Analyst. "Without a significant de-leveraging of its balance sheet, Hercules is following a path that could lead to financial hardship at the first sign of a market softening." Hercules' Caa1 CFR rating reflects its highly leveraged balance sheet and limited ability to generate free cash flow. The Caa1 rating on the senior secured notes reflects their pari passu secured position in Hercules' capital structure relative to the senior secured credit facilities. HOLLIFIELD RANCHES: Has Access to Cash Collateral Until Dec. 28 --------------------------------------------------------------- The Hon. Jim D. Pappas of the U.S. Bankruptcy Court for the District of Idaho approved a stipulation, extending Hollifield Ranches, Inc.'s access to KeyBank's cash collateral until December 28, 2011. As of the Petition Date, the Debtor owes KeyBank $12,629,375. KeyBank asserts an interest in the Debtor's assets, including its cash. The Debtor is using the cash collateral postpetition to fund its Chapter 11 case, pay suppliers and other parties. As adequate protection for any diminution in value of KeyBank's collateral, the Debtors will grant the KeyBank postpetition lien in the same priority and to the extent it existed prepetition and also to the extent of the cash collateral used in all collateral that it had an interest in prepetition. A copy of the Third Order Regarding Stipulated Use of Cash Collateral is available for free at: http://bankrupt.com/misc/HOLLIFIELDcashcollateral_order.pdf About Hollifield Ranches, Inc. Hansen, Idaho-based Hollifield Ranches, Inc., filed for Chapter 11 bankruptcy protection on September 9, 2010 (Bankr. D. Idaho Case No. 10-41613). Brent T. Robinson, Esq., in Rupert, Idaho, represents the Debtor. The Debtor estimated assets and debts at $10 million to $50 million as of the Chapter 11 filing. J. Justin May, Esq., at May, Browning & May represents the Official Committee of Unsecured Creditors. INNOVATIVE COMM: Virgin Islands Ct. Rules on Asset Turnover Suit ---------------------------------------------------------------- Stan Springel, the Chapter 11 Trustee of the Estate of Innovative Communication Corporation, and James P. Carroll, the Chapter 7 Trustee of the Estate of Jeffrey J. Prosser sued for turnover of certain property currently in the possession, custody or control of Jeffrey Prosser, Dawn Prosser, Jeffrey's wife, Michael Prosser, Jeffrey's brother, and the "Adult Prosser Children": Sybil Prosser, Michelle LaBennett, Lyndon Adrian Prosser, and Justin Prosser. The adversary proceeding was consolidated for the purposes of discovery and trial with the Chapter 11 Trustee's fraudulent conveyance adversary action (Adv. No. 08-3004) against the Adult Prosser Children. In a February 9, 2011 Memorandum Opinion, Bankruptcy Judge Judith K. Fitzgerald held that the Chapter 11 Trustee has not met his burden to prove that turnover is appropriate. The Chapter 7 Trustee has met his burden of proving the Chapter 7 estate's interest in certain items of property currently in the possession of one or more Defendants such that turnover is appropriate. As to other items, the Chapter 7 Trustee has not met his burden of proof and turnover will be denied. Judge Fitzgerald cautioned that the Memorandum Opinion does not in any way constitute a finding of whether the Trustees may successfully avoid transfers and recover property through the fraudulent conveyance action pending against the Adult Prosser Children in the Bankruptcy Court (Adv. No. 08-3004) or in the District Court actions against Dawn Prosser (Case Nos. 3:08-cv- 00146 and 3:08-cv-00147). Judge Fitzgerald also said the Court will address the Chapter 11 Trustee's fraudulent conveyance complaint against the Adult Prosser Children in a separate memorandum opinion as both the relevant facts and the elements for turnover and fraudulent conveyance differ. Thus, the rulings may differ from the rulings in the fraudulent conveyance actions. The case is Stan Springel, Chapter 11 Trustee of the Estate of Innovative Communication Corporation, and James P. Carroll, as Chapter 7 Trustee of the Estate of Jeffrey J. Prosser, v. Jeffrey J. Prosser, Dawn Prosser, Justin Prosser, Michael Prosser, Sybil G. Prosser, Michelle Labennett, and Lyndon A. Prosser, Adv. Pro. No. 07-3010 (Bankr. D. Virgin Islands). A copy of the Court's Memomrandum Opinion is available at http://is.gd/MuOwtVfrom Leagle.com. On January 20, 2011, Judge Fitzgerald denied Mr. Prosser's motion to vacate an October 9, 2009 exemption order and various "Supplements". A copy of the Court's order is available at http://is.gd/QIFALYfrom Leagle.com. About Prosser & Innovative Communication Headquartered in St. Thomas, Virgin Islands, Innovative Communication Company, LLC -- http://www.iccvi.com/-- and Emerging Communications, Inc., are diversified telecommunications and media companies operating mainly in the U.S. Virgin Islands. Jeffrey J. Prosser owns Emerging Communications and Innovative Communications. Innovative and Emerging filed for Chapter 11 protection on July 31, 2006 (D.V.I. Case Nos. 06-30007 and 06-30008). When the Debtors filed for protection from their creditors, they estimated assets and debts of more than $100 million. Mr. Prosser also filed for chapter 11 protection on July 31, 2006 (D.V.I. Case No. 06-10006). According to The (Virgin Islands) Source, he was fired in October 2007 for failing to make payments into the company pension funds. Greenlight Capital Qualified, L.P., Greenlight Capital, L.P., and Greenlight Capital Offshore, Ltd. -- which held an $18,780,614 claim against Mr. Prosser -- had filed an involuntary chapter 11 against Innovative Communication, Emerging Communications, and Mr. Prosser on Feb. 10, 2006 (Bankr. D. Del. Case Nos. 06-10133, 06-10134, and 06-10135). Mr. Prosser argued that the Greenlight entities, the former shareholders of Innovative Communications, and Rural Telephone Finance Cooperative, Mr. Prosser's lender, conspired to take down his companies into bankruptcy and collect millions in claims. The U.S. District Court of the Virgin Islands, Bankruptcy Division, approved the U.S. Trustee for Region 21's appointment of Stan Springel of Alvarez & Marsal as Chapter 11 Trustee of Innovative and Emerging Communications. INTERNATIONAL COAL: Steelhead Partners Has 5.8% Equity Stake ------------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, each of Steelhead Partners, LLC, James Michael Johnston, and Brian Katz Klein disclosed beneficial ownership of 11,825,000 shares of common stock of International Coal Group, Inc., representing 5.8% of the shares outstanding. Steelhead Navigator Master, L.P. also owns 11,640,000 shares or 5.7% equity stake. As of November 1, 2010, there were 203,808,203 shares of common stock of the Company outstanding. About International Coal Group Scott Depot, West Virginia-based International Coal Group, Inc. (NYSE: ICO) produces coal in Northern and Central Appalachia and the Illinois Basin. The Company has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia, and one in Central Illinois. ICG's mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers throughout the eastern United States. The Company's balance sheet at December 31, 2010, showed $1.48 billion in total assets, $724.25 million in total liabilities and $754.27 million in total stockholders' equity. * * * International Coal Group carries 'Caa1' corporate family and probability of default ratings from Moody's Investors Service, and 'B+' corporate credit rating from Standard & Poor's Ratings Services. In March 2010, Moody's said the ratings "continue to reflect ICG's elevated cost structure amidst an uncertain price environment, inherent operating risk at its mines, history of operating and financial challenges, significant capital spending requirements, and uncertainty regarding mine permitting obstacles particularly given the large percentage of surface mine production." INTERNATIONAL COAL: BlackRock Discloses 5.64% Equity Stake ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, BlackRock, Inc. disclosed that it beneficially owns 11,499,790 shares of common stock of International Coal Group Inc. representing 5.64% of the shares outstanding. As of November 1, 2010, there were 203,808,203 shares of common stock of the Company outstanding. About International Coal Group Scott Depot, West Virginia-based International Coal Group, Inc. (NYSE: ICO) produces coal in Northern and Central Appalachia and the Illinois Basin. The Company has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia, and one in Central Illinois. ICG's mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers throughout the eastern United States. The Company's balance sheet at December 31, 2010, showed $1.48 billion in total assets, $724.25 million in total liabilities and $754.27 million in total stockholders' equity. * * * International Coal Group carries 'Caa1' corporate family and probability of default ratings from Moody's Investors Service. In March 2010, Moody's said the ratings "continue to reflect ICG's elevated cost structure amidst an uncertain price environment, inherent operating risk at its mines, history of operating and financial challenges, significant capital spending requirements, and uncertainty regarding mine permitting obstacles particularly given the large percentage of surface mine production." JEFFREY PROSSER: Virgin Islands Ct. Rules on Asset Turnover Suit ---------------------------------------------------------------- Stan Springel, the Chapter 11 Trustee of the Estate of Innovative Communication Corporation, and James P. Carroll, the Chapter 7 Trustee of the Estate of Jeffrey J. Prosser sued for turnover of certain property currently in the possession, custody or control of Jeffrey Prosser, Dawn Prosser, Jeffrey's wife, Michael Prosser, Jeffrey's brother, and the "Adult Prosser Children": Sybil Prosser, Michelle LaBennett, Lyndon Adrian Prosser, and Justin Prosser. The adversary proceeding was consolidated for the purposes of discovery and trial with the Chapter 11 Trustee's fraudulent conveyance adversary action (Adv. No. 08-3004) against the Adult Prosser Children. In a February 9, 2011 Memorandum Opinion, Bankruptcy Judge Judith K. Fitzgerald held that the Chapter 11 Trustee has not met his burden to prove that turnover is appropriate. The Chapter 7 Trustee has met his burden of proving the Chapter 7 estate's interest in certain items of property currently in the possession of one or more Defendants such that turnover is appropriate. As to other items, the Chapter 7 Trustee has not met his burden of proof and turnover will be denied. Judge Fitzgerald cautioned that the Memorandum Opinion does not in any way constitute a finding of whether the Trustees may successfully avoid transfers and recover property through the fraudulent conveyance action pending against the Adult Prosser Children in the Bankruptcy Court (Adv. No. 08-3004) or in the District Court actions against Dawn Prosser (Case Nos. 3:08-cv- 00146 and 3:08-cv-00147). Judge Fitzgerald also said the Court will address the Chapter 11 Trustee's fraudulent conveyance complaint against the Adult Prosser Children in a separate memorandum opinion as both the relevant facts and the elements for turnover and fraudulent conveyance differ. Thus, the rulings may differ from the rulings in the fraudulent conveyance actions. The case is Stan Springel, Chapter 11 Trustee of the Estate of Innovative Communication Corporation, and James P. Carroll, as Chapter 7 Trustee of the Estate of Jeffrey J. Prosser, v. Jeffrey J. Prosser, Dawn Prosser, Justin Prosser, Michael Prosser, Sybil G. Prosser, Michelle Labennett, and Lyndon A. Prosser, Adv. Pro. No. 07-3010 (Bankr. D. Virgin Islands). A copy of the Court's Memomrandum Opinion is available at http://is.gd/MuOwtVfrom Leagle.com. On January 20, 2011, Judge Fitzgerald denied Mr. Prosser's motion to vacate an October 9, 2009 exemption order and various "Supplements". A copy of the Court's order is available at http://is.gd/QIFALYfrom Leagle.com. About Prosser & Innovative Communication Headquartered in St. Thomas, Virgin Islands, Innovative Communication Company, LLC -- http://www.iccvi.com/-- and Emerging Communications, Inc., are diversified telecommunications and media companies operating mainly in the U.S. Virgin Islands. Jeffrey J. Prosser owns Emerging Communications and Innovative Communications. Innovative and Emerging filed for Chapter 11 protection on July 31, 2006 (D.V.I. Case Nos. 06-30007 and 06-30008). When the Debtors filed for protection from their creditors, they estimated assets and debts of more than $100 million. Mr. Prosser also filed for chapter 11 protection on July 31, 2006 (D.V.I. Case No. 06-10006). According to The (Virgin Islands) Source, he was fired in October 2007 for failing to make payments into the company pension funds. Greenlight Capital Qualified, L.P., Greenlight Capital, L.P., and Greenlight Capital Offshore, Ltd. -- which held an $18,780,614 claim against Mr. Prosser -- had filed an involuntary chapter 11 against Innovative Communication, Emerging Communications, and Mr. Prosser on Feb. 10, 2006 (Bankr. D. Del. Case Nos. 06-10133, 06-10134, and 06-10135). Mr. Prosser argued that the Greenlight entities, the former shareholders of Innovative Communications, and Rural Telephone Finance Cooperative, Mr. Prosser's lender, conspired to take down his companies into bankruptcy and collect millions in claims. The U.S. District Court of the Virgin Islands, Bankruptcy Division, approved the U.S. Trustee for Region 21's appointment of Stan Springel of Alvarez & Marsal as Chapter 11 Trustee of Innovative and Emerging Communications. JH REALTY: Can't Use MetroBank's Cash Collateral ------------------------------------------------ Bankruptcy Judge Letitia Z. Paul denied JH Realty Investment, LP's emergency motion for interim order authorizing it to use the cash collateral of MetroBank, N.A. Judge Paul said the Debtor's budget does not provide for any payment to MetroBank. It is clear that the Debtor's expenditure of cash would reduce the amount of cash distributable to MetroBank. The Debtor presented no evidence to support its contention that the replacement lien it has offered is adequate to protect against any decrease in the value of MetroBank's asserted interest in the cash collateral. Jian Hua Hu, president of the Debtor, testified to the Court that the Debtor used MetroBank's cash collateral without Court approval or the bank's consent from the Petition Date until the date it sought permission to use the cash collateral. The Court noted that the Debtor has not accounted for its use of cash collateral from the petition date. The Debtor has not met its burden of proof on the issue of adequate protection. MetroBank has filed a proof of claim for $1,302,295. MetroBank asserts a security interest in the real property, plus rents, accounts, equipment, and other intangibles. A copy of Judge Paul's February 9, 2011 Memorandum Opinion is available at http://is.gd/aKT3ZTfrom Leagle.com. JH Realty Investment, LP, operates a shopping center and a supermarket. JH Realty Investment filed for Chapter 11 bankruptcy (Bankr. S.D. Texas Case No. 10-80636) on October 29, 2010, listing under $500,000 in both assets and debts. A copy of the Debtor's petition is available at http://bankrupt.com/misc/txsb10-80636.pdf The Law Office of Kenneth Gu in Houston serves as counsel to the Debtor. KENTUCKIANA MEDICAL: Head Doctors Sued for Ch. 11 Filing -------------------------------------------------------- Ben Zion Hershberg at The Courier-Journal reports that nephrologist Abdul Buridi, a doctor who invested in the Kentuckiana Medical Center, sued in Jefferson Circuit Court in Louisville doctors that led the hospital -- Chris Stavens, Eli Hallal and Badr Idbeis -- alleging that they put their personal financial interest, particularly as it involved the real estate company that owns the center's building and land, before the interests of about 30 other doctors who invested in the hospital. According to the report, Dr. Buridi claimed the three defendants - who control the interrelated companies that built and operate the center -- continued to maintain monthly mortgage payments of $300,000 a month, more than was necessary, for their own benefit and thereby "depleting" the hospital's cash reserves. Dr. Buridi's lawsuit claims that the three decided to seek Chapter 11 bankruptcy protection in September in an attempt to reorganize the hospital despite offers from other investors that would have reduced their control of the hospital and its interrelated companies. Dr. Buridi claimed the hospital's initial problems were caused by errors made by the defendants, who were responsible for ensuring the hospital was built and operated properly. About Kentuckiana Medical Clarksville, Indiana-based Kentuckiana Medical Center LLC filed for Chapter 11 bankruptcy protection on September 19, 2010 (Bankr. S.D. Ind. Case No. 10-93039). David M. Cantor, Esq., at Seiller Waterman LLC, represents the Debtor. The Debtor reported $9,496,899 in assets, and $25,029,083 in liabilities. LACK'S STORES: Court Approves Platzer Swergold as Panel's Counsel ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Texas authorized the Official Committee of Unsecured Creditors of Lack's Stores Inc. and its debtor-affiliates to retain Platzer, Swergold, Karlin, Levine, Goldbert & Jaslow, LLP, as counsel. The firm is expected to, among other things: a) assist and advise the Committee in its consultation with the Debtors relatives to the administration of these cases; b) attend meetings and negotiate with the representatives of the Debtors; c) assist and advise the Committee in its examination and analysis of the conduct of the Debtors' affairs; d) assist the Committee in the review, analysis and negotiation of any plan(s) of reorganization/liquidation filed and assist the Committee in the review, analysis and negotiation of the disclosure statement accompanying any such plan(s); and e) assist the Committee in the review, analysis and negotiation of any financing arrangements. The firm will charge the Debtor's estate based on the hourly rates of its professionals: Designations Hourly Rates ------------ ------------ Partners $475-$670 Associates $200-$475 Paraprofessionals $175 Clifford A. Katz, Esq., attorney of the firm, assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Mr. Katz can be reached at: Clifford A. Katz, Esq. PLATZER, SWERGOLD, KARLIN, LEVINE, GOLDBERT & JASLOW LLP 1065 Avenue of The Americas, 18th Floor New York, New York 10018 Tel: 212-593-3000 Fax: 212-593-0353 E-mail: ckatz@platzerlaw.com About Lack's Stores Victoria, Texas-based Lack's Stores, Incorporated, is one of the largest, independently-owned retail furniture chains in the United States. Lack's Stores is a chain of 36 retail stores and operates under the trade styles Lacks and Lacks Home Furnishings. The Company sells a complete line of furnishings for the home including furniture, bedding, major appliances and home electronics. The stores are located in South, Central, and West Texas. Lack's Stores and its affiliates filed for Chapter 11 bankruptcy protection on November 16, 2010 (Bankr. S.D. Tex. Lead Case No. 10-60149). The Debtor estimated its assets and debts at $100 million to $500 million. Katherine D. Grissel, Esq., Michaela Christine Crocker, Esq., and Richard H. London, Esq., at Vinson & Elkins LLP, serve as counsel to the Debtor. Huron Consulting Group, Inc., is the financial advisor. LACK'S STORES: Court Okays Strong Pipkin as Panel's Local Counsel ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas authorized the Official Committee of Unsecured Creditors of Lack's Stores Inc. and its debtor-affiliates for permission to retain Strong Pipkin Bisell & Ledyard LLP as local counsel. Among other things, the firm will: a) advise the Committee with respect to its rights, duties and powers in these Chapter 11 cases; b) assist and advise the Committee in its consultation with the Debtors relative to the administration of these Chapter 11 cases; c) assist the Committee in analyzing the claims of the Debtors' creditors and in negotiating with holders of claims and equity interest; d) assist the Committee in its investigation of the acts, conducts, assets, liabilities and financial condition of the Debtors and of the conduct of the Debtors' affairs; and e) assist the Committee in its investigation of the acts, conducts, assets, liabilities and financial condition of the Debtors and of the conduct of the Debtors' affairs. The firm's professionals will be paid at these rates: Professionals Designation Hourly Rates ------------- ----------- ------------ S. Margie Venus, Esq. Of Counsel $450 Michelle Hebert Paralegal $150 Ms. Venus assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Ms. Venues can be reached at: S. Margie Venues, Esq. STRONG PIPKIN BISSELL & LEDYARD LLP 1301 McKinney, Suite 2100 Houston, Texas 77010 Tel: 713-651-1900 E-mail: mvenus@strongpipkin.com About Lack's Stores Victoria, Texas-based Lack's Stores, Incorporated, is one of the largest, independently-owned retail furniture chains in the United States. Lack's Stores is a chain of 36 retail stores and operates under the trade styles Lacks and Lacks Home Furnishings. The Company sells a complete line of furnishings for the home including furniture, bedding, major appliances and home electronics. The stores are located in South, Central, and West Texas. Lack's Stores and its affiliates filed for Chapter 11 bankruptcy protection on November 16, 2010 (Bankr. S.D. Tex. Lead Case No. 10-60149). The Debtor estimated its assets and debts at $100 million to $500 million. Katherine D. Grissel, Esq., Michaela Christine Crocker, Esq., and Richard H. London, Esq., at Vinson & Elkins LLP, serve as counsel to the Debtor. Huron Consulting Group, Inc., is the financial advisor. LACK'S STORES: Texas Comptroller Asks $7.4MM from Sale Proceeds --------------------------------------------------------------- Barry Harrell, writing for the Austin American-Statesman's Statesman Business Blog, reports that the Texas state comptroller's office has stepped into the Lack's Stores Inc. bankruptcy case to protect from creditors about $7.4 million in deferred sales tax it says the Company owes the state. According to the report, the CIT Group/Business Credit Inc., representing those lenders, filed a petition in federal bankruptcy court, asking that Lack's be ordered to pay it "all the remaining proceeds" of its liquidation sales. Lack's owed those lenders more than $87 million. However, the state comptroller's office objected to the CIT Group's request. The Texas Comptroller, the Statesman relates, said that Lack's owed the state an estimated $7.4 million in deferred sales tax and that money can't be considered "the cash collateral" of any lender. "Any order approving the CIT motion should clarify that the comptroller's sales tax trust funds are not part of CIT's cash collateral and will not be paid over to CIT." About Lack's Stores Victoria, Texas-based Lack's Stores, Incorporated, is one of the largest, independently-owned retail furniture chains in the United States. Lack's Stores is a chain of 36 retail stores and operates under the trade styles Lacks and Lacks Home Furnishings. The Company sells a complete line of furnishings for the home including furniture, bedding, major appliances and home electronics. The stores are located in South, Central, and West Texas. Lack's Stores and its affiliates filed for Chapter 11 bankruptcy protection on November 16, 2010 (Bankr. S.D. Tex. Lead Case No. 10-60149). The Debtor estimated its assets and debts at $100 million to $500 million. Katherine D. Grissel, Esq., Michaela Christine Crocker, Esq., and Richard H. London, Esq., at Vinson & Elkins LLP, serve as counsel to the Debtor. Huron Consulting Group, Inc., is the financial advisor. The Official Committee of Unsecured Creditors has tapped Platzer, Swergold, Karlin, Levine, Goldbert & Jaslow, LLP, as counsel and Strong Pipkin Bisell & Ledyard LLP as local counsel. LEVITT AND SONS: BFC Financial Offers $30,000 for Tradenames ------------------------------------------------------------ James S. Feltman, in his capacity as the Plan Administrator under the Chapter 11 plan confirmed in Levitt and Sons, LLC's Chapter 11 cases, is asking the U.S. Bankruptcy Court for permission to sell the Debtors' tradenames, trademarks and logos, to BFC Financial Corp. for $30,000. The transaction is subject to higher and better offers that may emerge prior to a sale hearing set for 9:30 a.m. on Feb. 22, 2011, in Fort Lauderdale, Fla. Additional information about the proposed sale is available Paul A. Avron, Esq. -- pavron@bergersingerman.com -- at Berger, Singerman, P.A., who represents the Plan Administrator. About Levitt & Sons Headquartered in Fort Lauderdale, Florida, Levitt and Sons LLC -- http://www.levittandsons.com/-- is the homebuilding subsidiary of Levitt Corporation (NYSE:LEV). Levitt Corp. -- http://www.levittcorporation.com/-- together with its subsidiaries, operates as a homebuilding and real estate development company in the southeastern United States. The company operates in two divisions, homebuilding and land. The homebuilding division primarily develops single and multi-family homes for adults and families in Florida, Georgia, Tennessee, and South Carolina. The land division engages in the development of master-planned communities in Florida and South Carolina. Levitt and Sons LLC and 38 of its homebuilding affiliates filed for Chapter 11 protection on November 9, 2007 (Bankr. S.D. Fla. Lead Case No. 07-19845). Paul Singerman, Esq. and Jordi Guso, Esq., at Berger Singerman, P.A., represented the Debtors in their bankruptcy cases. The Debtors chose AP Services, LLC as their crisis managers, and Kurtzman Carson Consultants, LLC as their claims and noticing agent. Levitt Corp., the parent company, was not included in the bankruptcy filing. Judge Raymond B. Rays confirmed Levitt & Sons' liquidating Chapter 11 plan in February 2009. LEXI DEVELOPMENT: Wants Plan Outline Hearing Continued to March 13 ------------------------------------------------------------------ Lexi Development Company, Inc., has requested the U.S. Bankruptcy Court for the Southern District of Florida to continue the hearing on the disclosure statement explaining its plan of reorganization to March 13, 2011, or such later date when the Court is available, citing that the disclosure statement is likely to be revised as a result of the complaint it filed September 10, 2010, against Lexi North Bay LLC, and Great Florida Bank, and possibly the court ordered mediation of the Adversary Proceeding (Adversary Case No. 10-03582). The Complaint was filed to determine, among other things, the status and validity of the conflicting asserted liens against the Debtor's property. The Chapter 11 Plan The Plan provides that all of the Debtor's assets will revest in the Reorganized Debtor on the Effective Date of the Plan. Allowed Secured Claims of Lexi North Bay or Great Florida Bank under Class 2, to be determined by a final, non-appealable order in the Lien Adversary Proceeding, will be paid in full, including note rate interest, from the Net Sales Proceeds (from the closings of the Units pursuant to priority and after any senior liens are paid in full) and the Rental Income, within three (3) years from the effective date of the Plan. Any deficiency will be treated as an Allowed General Unsecured Claim under Class 6. General unsecured creditors under Class 6 will be paid from Rental Income and the Net Sales Proceeds generated by the sale or liquidation of the Debtor's assets and any Third Party Litigation Claims, within three and one half (3 1/2) years from the Effective Date, only after Allowed Class 2, Allowed Class 3, Allowed Class 4, and Allowed Class 5 Claims have been paid in full. To the extent that Great Florida Bank is not granted an equitable lien against the Debtor, its unsecured claim will be paid from Rental Income and the Net Sales Proceeds generated by the sale or liquidation of the Debtor's assets and any Third Party Litigation Claims, totaling $4,000,000 in full, including note interest, within four and one half (4 1/2) years from the Effective Date, only after the Allowed Class 2, Allowed Class 3, Allowed Class 4, Allowed Class 5, and Allowed Class 6 Claims have been paid in full. All Class 9 Equity Interests will revest in the Reorganized Debtor on the Effective Date. The holders of allowed equity interests will retain their equity interests for the sole purpose of governing the Reorganized Debtor and each holder of an allowed Class 9 equity interest will not receive any consideration on account of such interest. A copy of the Debtor's Disclosure Statement in support of its Plan of Reorganization is available for free at: http://bankrupt.com/misc/LexiDevelopment.DS.pdf About Lexi Development South Miami, Florida-based Lexi Development Company, Inc., owns and is developing a 164 unit, 19 story, mixed-use residential and retail bayview condominium development located at 1700 Kennedy Causeway, North Bay Village, in Florida. The Company filed for Chapter 11 bankruptcy protection on June 23, 2010 (Bankr. S.D. Fla. Case No. 10-27573). Joshua W. Dobin, Esq., at Meland Russin & Budwick, P.A., in Miami, represents the Debtor as counsel. In its schedules, the Debtor disclosed $22,601,336 in assets and $21,558,876 in liabilities. LEXI DEV'T: Has Interim OK to Use Lexi North Bay's Cash Collateral ------------------------------------------------------------------ Lexi Development Company, Inc., obtained interim authorization from the Hon. A. Jay Cristol of the U.S. Bankruptcy Court for the Southern District of Florida to use cash collateral for 60 days. The Debtor has reached an agreement with secured creditor Lexi North Bay, LLC, to the interim use of cash collateral. As reported by the Troubled Company Reporter on July 6, 2010, the Debtor executed and delivered in December 2005 to Regions Bank, acting for itself and as administrative agent and collateral agent for Banco Popular North America; Bank Midwest, N.A.; and First Charter Bank a construction loan agreement in the original principal amount of $56,875,000. As of the Petition Date, $10,160,000 of the original $56,875,000 loan amount remains outstanding, not including any asserted default rate interest which the Debtor disputes. On Closing Date, the Debtor executed and delivered to Regions a promissory note in the principal amount of $25,000,000. The Debtor also executed and delivered promissory notes in favor of: (i) Bank Midwest in the original principal amount of $10,937,500; (ii) First Charter in the original principal amount of $10,000,000; and (iii) Banco Popular in the original amount of $10,937,500. Fifth Third Bank later came to own and hold the promissory note executed and delivered to First Charter as successor. The lenders purportedly sold and assigned to their loan and related rights to North Bay. Joshua W. Dobin, Esq., at Meland Russin & Budwick, P.A., the attorney for the Debtor, explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the cash collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/Lexi_Development_cashcollateralbudget.pdf North Bay will be granted an administrative expense claim to the extent of the diminution, if any, in the value of its interests in the cash collateral as of the Petition Date. North Bay is also granted a replacement lien on and in all property, owned or generated postpetition by the Debtor and its continued operations to the same extent and priority and of the same kind and nature as North Bay had prior to the Debtor's filing of the bankruptcy case. The Debtor will furnish North Bay with financial and other information. The Debtor will, within seven days after January 31, 2011, and February 28, 2011, respectively, pay to North Bay the net income for the respective month, expected to be the net projected income for that month as set forth in the budget. The Court has set a final hearing for March 3, 2011, at 10:30 a.m. on the Debtor's request to use the cash collateral. About Lexi Development South Miami, Florida-based Lexi Development Company, Inc., owns and is developing a 164 Unit, 19-story, mixed-use residential and retail bay view condominium development at 1700 Kennedy Causeway, North Bay Village, Florida, known as "The Lexi". It filed for Chapter 11 bankruptcy protection on June 23, 2010 (Bankr. S.D. Fla. Case No. 10-27573). According to its schedules, the Debtor disclosed $22,601,336 in total assets and $21,558,876 in total debts. LOCAL INSIGHT: Directory Distributing Resigns from Committee ------------------------------------------------------------ BankruptcyData.com reports that the U.S. Trustee assigned to the Local Insight Media case filed with the U.S. Bankruptcy Court a first amended official committee of unsecured creditors list. The amended list reflects the voluntary resignation of Directory Distributing Associates, Inc. The remaining members of the Committee are: 1) U.S. Bank National Attn: Timothy Sandell 60 Livingston Avenue St. Paul, Minnesota 55107-2292 Tel: 651-495-3959 Fax: 651-495-8100 2) Bain & Company, Inc. Attn: Diane Fernandes 131 Dartmouth Street Boston, Massachusetts 02116 Tel: 617-572-2286 Fax: 617-880-0286 3) Quadgraphics Inc. Attn: Patricia A Rydzik N63 W23075 State Hwy 74 Sussex, Wisconsin 53089-2827 Tel: 414-566-2127 Fax: 414-566-9415 4) Marchex Sales Inc. Attn: Ethan Caldwell 520 Pike Street, Suite 2000 Seattle, Waswhinton 98101 Tel: 206-331-3310 Fax: 206-331-3696 About Local Insight Media Holdings Wilmington, Delaware-based Local Insight Media Holdings, Inc., is a publisher of print and online yellow page directories in the United States. It filed for Chapter 11 bankruptcy protection on (Bankr. D. Del. Case No. 10-13677) on November 17, 2010. Affiliates Local Insight Media Holdings II, Inc. (Bankr. D. Del. Case No. 10-13679), Local Insight Media Holdings III, Inc. (Bankr. D. Del. Case No. 10-13682), LIM Finance Holdings, Inc. (Bankr. D. Del. Case No. 10-13680), LIM Finance, Inc. (Bankr. D. Del. Case No. 10-13681), LIM Finance II, Inc. (Bankr. D. Del. Case No. 10-13687), Local Insight Regatta Holdings, Inc. (Bankr. D. Del. Case No. 10-13686), The Berry Company LLC (Bankr. D. Del. Case No. 10-13678), Local Insight Listing Management, Inc. (Bankr. D. Del. Case No. 10-13685), Regatta Investor Holdings, Inc. (Bankr. D. Del. Case No. 10-13725), Regatta Investor Holdings II, Inc. (Bankr. D. Del. Case No. 10-13741), Regatta Investor LLC (Bankr. D. Del. Case No. 10-13684), Regatta Split-off I LLC (Bankr. D. Del. Case No. 10-13721), Regatta Split-off II LLC (Bankr. D. Del. Case No. 10-13753), Regatta Split-off III LLC (Bankr. D. Del. Case No. 10-13737), Regatta Holding I, L.P. (Bankr. D. Del. Case No. 10-13748), Regatta Holding II, L.P. (Bankr. D. Del. Case No. 10-13715), and Regatta Holding III, L.P. (Bankr. D. Del. Case No. 10-13745) filed separate Chapter 11 petitions. Richard M. Cieri, Esq., Christopher J. Marcus, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis LLP, serve as the Debtors' bankruptcy counsel. Curtis A. Hehn, Esq., Laura Davis Jones, Esq., and Michael Seidl, Esq., at Pachulski Stang Ziehl & Jones LLP, are the Debtors' co-counsel. The Debtors' investment banker and financial advisor is Lazard Freres & Co. LLC. The Debtors' independent auditor is Deloitte & Touche LLP. The Debtors' interim management and restructuring advisors are Alvarez & Marsal North America, LLC, and Avarez & Marsal Private Equity Performance Improvement Group, LLC. Kurtzman Carson Consultants LLC is the Debtors' notice and claims agent. Local Insight Media Holdings estimated assets of less than $50,000 and liabilities of $100 million to $500 million in its Chapter 11 petition. Local Insight Regatta reported consolidated assets of $796,270,000 against consolidated debts of $669,612,000 as of September 30, 2010, according to its Form 10-Q filed with the Securities and Exchange Commission. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP as its counsel; Morris, Nichols, Arsht & Tunnel LLP as Delaware co-counsel; and Houlihan Lokey Howard & Zukin Capital Inc. as its financial advisor and investment banker. LOCAL INSIGHT: Proposes April 4, 2011 Claims Bar Date ----------------------------------------------------- Local Insight Media Holdings Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to set April 4, 2011, at 5:00 p.m., as deadline for creditors to file proofs of claim. The Debtors propose May 16, 2011, at 5:00 p.m., as deadline for governmental units to file proofs of claim. All proofs of claim must be filed at: Local Insight Claims Processing Center c/o Kurtzman Carson Consultants 2335 Alaska Avenue El Segundo, California 90245 About Local Insight Media Holdings Wilmington, Delaware-based Local Insight Media Holdings, Inc., is a publisher of print and online yellow page directories in the United States. It filed for Chapter 11 bankruptcy protection on (Bankr. D. Del. Case No. 10-13677) on November 17, 2010. Affiliates Local Insight Media Holdings II, Inc. (Bankr. D. Del. Case No. 10-13679), Local Insight Media Holdings III, Inc. (Bankr. D. Del. Case No. 10-13682), LIM Finance Holdings, Inc. (Bankr. D. Del. Case No. 10-13680), LIM Finance, Inc. (Bankr. D. Del. Case No. 10-13681), LIM Finance II, Inc. (Bankr. D. Del. Case No. 10-13687), Local Insight Regatta Holdings, Inc. (Bankr. D. Del. Case No. 10-13686), The Berry Company LLC (Bankr. D. Del. Case No. 10-13678), Local Insight Listing Management, Inc. (Bankr. D. Del. Case No. 10-13685), Regatta Investor Holdings, Inc. (Bankr. D. Del. Case No. 10-13725), Regatta Investor Holdings II, Inc. (Bankr. D. Del. Case No. 10-13741), Regatta Investor LLC (Bankr. D. Del. Case No. 10-13684), Regatta Split-off I LLC (Bankr. D. Del. Case No. 10-13721), Regatta Split-off II LLC (Bankr. D. Del. Case No. 10-13753), Regatta Split-off III LLC (Bankr. D. Del. Case No. 10-13737), Regatta Holding I, L.P. (Bankr. D. Del. Case No. 10-13748), Regatta Holding II, L.P. (Bankr. D. Del. Case No. 10-13715), and Regatta Holding III, L.P. (Bankr. D. Del. Case No. 10-13745) filed separate Chapter 11 petitions. Richard M. Cieri, Esq., Christopher J. Marcus, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis LLP, serve as the Debtors' bankruptcy counsel. Curtis A. Hehn, Esq., Laura Davis Jones, Esq., and Michael Seidl, Esq., at Pachulski Stang Ziehl & Jones LLP, are the Debtors' co-counsel. The Debtors' investment banker and financial advisor is Lazard Freres & Co. LLC. The Debtors' independent auditor is Deloitte & Touche LLP. The Debtors' interim management and restructuring advisors are Alvarez & Marsal North America, LLC, and Avarez & Marsal Private Equity Performance Improvement Group, LLC. Kurtzman Carson Consultants LLC is the Debtors' notice and claims agent. Local Insight Media Holdings estimated assets of less than $50,000 and liabilities of $100 million to $500 million in its Chapter 11 petition. Local Insight Regatta reported consolidated assets of $796,270,000 against consolidated debts of $669,612,000 as of September 30, 2010, according to its Form 10-Q filed with the Securities and Exchange Commission. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP as its counsel; Morris, Nichols, Arsht & Tunnel LLP as Delaware co-counsel; and Houlihan Lokey Howard & Zukin Capital Inc. as its financial advisor and investment banker. MAGIC BRANDS: Court Formally Approves Sale to Luby's Inc. --------------------------------------------------------- Eric Sanderson at BankruptcyHome.com reports that the U.S. Bankruptcy Court for the District of Delaware approved sale of Magic Brands nka Deel LLC to Luby's Inc., a Houston, Texas-based restaurant operator. According to the report, Deel was sold to the company back in June at an auction for $63.5 million. However, courts needed to intervene as Tavistock, the business that made the first bid, claimed there were irregularities at the auction. The judge later overruled this claim, as well as objections from operators of the chains who wanted to stop Deel's sale of its chain's intellectual property. About Magic Brands Headquartered in Austin, Texas, Magic Brands, LLC -- http://www.fuddruckers.com/-- operated 62 Fuddruckers locations in 11 states and 3 Koo Koo Roo restaurants in California. Magic Brands and its operating units filed for Chapter 11 protection on April 21, 2010 (Bankr. D. Del. Lead Case No. 10-11310). It estimated assets of up to $10 million and debts at $10 million to $50 million in its Chapter 11 petition. Affiliate Fuddruckers, Inc., also filed, estimating assets and debts at $50 million to $100 million. FocalPoint Securities, LLC, serves as investment banker to Magic Brands, and Goulston & Storrs serves as lead bankruptcy counsel. Kurtzman Carson Consultants, LLC, is the claims and notice agent. The Official Committee of Unsecured Creditors has tapped Kelley Drye & Warren LLP as counsel and Klehr Harrison Harvey Branzburg LLP as co-counsel. Magic Brands in July 2010 closed the sale of the Fuddruckers stores and franchise business to restaurant operator Luby's Inc. for $63.5 million. Magic Brands, which has changed its name to Deel LLC following the Luby's sale, filed a liquidating Chapter 11 plan on Jan. 18. Bill Rochelle, the bankruptcy columnist for Bloomberg News, said the Disclosure Statement explaining the Plan indicated that unsecured creditors should have a "meaningful recovery." Mr. Rochelle said there are blanks in the disclosure statement where creditors later will be told the expected percentage of their recovery. MAGNA ENTERTAINMENT: Court Sides With PA Meadows in Contract Row ---------------------------------------------------------------- Magna Entertainment Corp., v. PA Meadows, LLC, Adv. Pro. No. 09-52212 (Bankr. D. Del.), was commenced September 29, 2009, seeking damages for breach of a holdback agreement as a result of the failure by PAM -- a subsidiary of MezzCo, LLC, which is in turn a subsidiary of Cannery Casino Resorts, LLC -- to pay $10 million which MEC alleges was due April 15, 2009, and seeking a mandatory injunction requiring PAM to make all future payments due under the Holdback Agreement. In 2005, MEC and PAM executed a stock purchase agreement pursuant to which PAM bought all of the stock in three subsidiaries of MEC which owned and operated the Meadows Racetrack in Pennsylvania. PAM paid the purchase price of $200 million in two promissory notes. After the Meadows Racetrack received a gaming license, in November 2006, PAM paid the $175 million note in full and the $25 million note was replaced by a Holdback Agreement. The Holdback Agreement provided that the remaining $25 million would be paid in five annual installments commencing on the later of February 15, 2008, and the Holdback Trigger Date -- defined as the date that a permanent casino opens at the Meadows. The payment of the installments was subject, however, to there being Available Excess Cash Flow under the Meadows Credit Agreements for the prior fiscal year. The Holdback Agreement permitted PAM to incur additional debt to finance the casino and to enter into new, amended or restated credit agreements so long as PAM used its best efforts to obtain terms that do not have more restrictive definitions of Excess Cash Flow than the terms of the original Meadows Credit Agreements. In addition, the Holdback Agreement provided that PAM would pay all accrued installments before MezzCo could receive any proceeds from the sale of any equity or assets of PAM. In May 2007, CCR entered into a new global financing for all its entities, on which PAM was a guarantor, resulting in the termination of the Meadows Credit Agreements. About the same time, CCR entered into negotiations with an Australian corporation, Crown Limited, which was interested in acquiring CCR for an expected price of $1.7 billion. When the parties were not able to get the requisite approvals, they closed on a different deal on March 12, 2009, pursuant to which Crown purchased less than half of the equity in CCR for $320 million. In the lawsuit, both parties seek summary judgment based on the plain language of the Holdback Agreement. MEC contends that PAM is in violation of the Holdback Agreement by failing to pay at least $10 million allegedly due thereunder and seeks summary judgment in that amount plus a mandatory injunction requiring PAM to make future payments as required under the Agreement. PAM denies that any payments are currently due under the express language of the Agreement. Bankruptcy Judge Mary F. Walrath finds it unnecessary to decide issues raised by MEC because the actual terms of the replacement credit agreements are irrelevant. The only obligation PAM had under the Holdback Agreement was to use its best efforts to get terms that were not more restrictive than the original Meadows Credit Agreements. MEC has offered no evidence that PAM did not use its best efforts. In contrast, PAM points to the analysis that it provided to MEC at the time of the refinance which showed that it would improve PAM's ability to make the holdback payments. As a result, the Court concludes that PAM has established that it used its best efforts in negotiating the replacement credit facility to assure that it protected MEC's rights to payment of the holdback. MEC has not established that it is entitled to summary judgment, while PAM has established that it is entitled to summary judgment in its favor on the Amended Complaint. A copy of Judge Walrath's February 9, 2011 Opinion is available at http://is.gd/OdA4e6from Leagle.com. About Magna Entertainment Corp. Based in Aurora, Ontario, Magna Entertainment Corp. is North America's largest owner and operator of horse racetracks based on revenue. The Company develops, owns and operates horse racetracks and related pari-mutuel wagering operations, including off-track betting facilities. MEC also develops, owns and operates casinos in conjunction with its racetracks where permitted by law. MEC owns and operates AmTote International, Inc., a provider of totalisator services to the pari-mutuel industry, XpressBet(R), a national Internet and telephone account wagering system, as well as MagnaBet(TM) internationally. Pursuant to joint ventures, MEC has a 50% interest in HorseRacing TV(R), a 24-hour horse racing television network, and TrackNet Media Group LLC, a content management company formed for distribution of the full breadth of MEC's horse racing content. Following its failure to meet obligations to lenders led by PNC Bank, National Association, and Wells Fargo Bank, National Association, and controlling shareholder MI Developments Inc.'s decision not to provide further financial backing, Magna Entertainment Corp. and 24 affiliates filed for Chapter 11 on March 5, 2009 (Bankr. D. Del. Lead Case No. 09-10720). Marcia L. Goldstein, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, served as the Debtors' bankruptcy counsel. Mark D. Collins, Esq., L. Katherine Good, Esq., and Maris J. Finnegan, Esq., at Richards, Layton & Finger, P.A., served as the Debtors' local counsel. Miller Buckfire & Co. LLC acted as the Debtors' investment banker and financial advisor. Kurtzman Carson Consultants LLC served as the claims and noticing agent for the Debtors. Magna Entertainment Corp. had total assets of $1.054 billion and total liabilities of $947.3 million based on unaudited consolidated financial statements as of December 31, 2008. On April 29, 2010, the Bankruptcy Court confirmed the Second Modified Third Amended Joint Plan of Magna Entertainment Corp., its affiliated Debtors, the official committee of unsecured creditors, MI Developments Inc., and MI Developments US Financing. The Debtors emerged from Bankruptcy on April 30, 2010. MAGNA ENTERTAINMENT: Loses $10-Million Suit Against PA Meadows -------------------------------------------------------------- Bankruptcy Law360 reports that a federal judge ruled Wednesday that casino operator PA Meadows LLC does not owe $10 million to Magna Entertainment Corp. in connection with a $200 million purchase agreement for MEC's Meadows Racetrack in Pennsylvania. Judge Mary Walrath of the U.S. Bankruptcy Court for the District of Delaware granted PA Meadows' motion for summary judgment and denied MEC's motion for summary judgment, according to Law360. Following its failure to meet obligations to lenders led by PNC Bank, National Association, and Wells Fargo Bank, National Association, and controlling shareholder MI Developments Inc.'s decision not to provide further financial backing, Magna Entertainment Corp. and 24 affiliates filed for Chapter 11 on March 5, 2009 (Bankr. D. Del. Lead Case No. 09-10720). Marcia L. Goldstein, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, served as the Debtors' bankruptcy counsel. Mark D. Collins, Esq., L. Katherine Good, Esq., and Maris J. Finnegan, Esq., at Richards, Layton & Finger, P.A., served as the Debtors' local counsel. Miller Buckfire & Co. LLC acted as the Debtors' investment banker and financial advisor. Kurtzman Carson Consultants LLC served as the claims and noticing agent for the Debtors. Magna Entertainment Corp. had total assets of $1.054 billion and total liabilities of $947.3 million based on unaudited consolidated financial statements as of December 31, 2008. On April 29, 2010, the Bankruptcy Court confirmed the Second Modified Third Amended Joint Plan of Magna Entertainment Corp., its affiliated Debtors, the official committee of unsecured creditors, MI Developments Inc., and MI Developments US Financing. The Debtors emerged from Bankruptcy on April 30, 2010. MARANA HOSPITALITY, LLC: Case Summary & Creditors List ------------------------------------------------------ Debtor: Marana Hospitality, LLC 4572 E. Camp Lowell Drive Tucson, AZ 85712 Bankruptcy Case No.: 11-03215 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: Eileen W. Hollowell Debtor's Counsel: Michael W. McGrath, Esq. MESCH CLARK & ROTHSCHILD 259 North Meyer Avenue Tucson, AZ 85701-1090 Tel: (520) 624-8886 Fax: (520) 798-1037 E-mail: ecfbk@mcrazlaw.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 two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb11-03215.pdf The petition was signed by M. Chris Monson of Aberdeen Group, LLC, managing member. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Marana Hospitality II, LLC 11-03207 02/09/11 Marana Main Street, LLC 11-03216 02/09/11 MARANA HOSPITALITY II: Case Summary & Creditors List ---------------------------------------------------- Debtor: Marana Hospitality II, LLC 4572 E. Camp Lowell Drive Tucson, AZ 85712 Bankruptcy Case No.: 11-03207 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: James M. Marlar Debtor's Counsel: Michael W. McGrath, Esq. MESCH CLARK & ROTHSCHILD 259 North Meyer Avenue Tucson, AZ 85701-1090 Tel: (520) 624-8886 Fax: (520) 798-1037 E-mail: ecfbk@mcrazlaw.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 two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb11-03207.pdf The petition was signed by M. Chris Monson of Aberdeen Group, LLC, managing member. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Marana Hospitality, LLC 11-03215 02/09/11 Marana Main Street, LLC 11-03216 02/09/11 MARANA MAIN: Case Summary & 2 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Marana Main Street, LLC 4572 E. Camp Lowell Drive Tucson, AZ 85712 Bankruptcy Case No.: 11-03216 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: Eileen W. Hollowell Debtor's Counsel: Michael W. McGrath, Esq. MESCH CLARK & ROTHSCHILD 259 North Meyer Avenue Tucson, AZ 85701-1090 Tel: (520) 624-8886 Fax: (520) 798-1037 E-mail: ecfbk@mcrazlaw.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 2 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb11-03216.pdf The petition was signed by M. Chris Monson of Aberdeen Group, LLC, managing member. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Marana Hospitality II, LLC 11-03207 02/09/11 Marana Hospitality, LLC 11-03215 02/09/11 MAYSVILLE INC: Court Dismisses Chapter 11 Case ---------------------------------------------- The Hon. Laurel M. Isicoff of the U.S. Bankruptcy Court for the Southern District of Florida dismissed the Chapter 11 case of Maysville Inc. at the behest of the Debtor's secured creditor MUNB Loan Holdings LLC. Judge Isicoff said all orders entered by the state court in the foreclosure case styled Mellon United National Bank v. Maysville, Inc., et al., Circuit Court of the 11th Judicial Circuit, in and for Miami-Dade County, Florida, Case No. 09-42213 CA 30, including, without limitation, all orders addressing the use of Mellon's cash collateral remain in full force and effect. The Debtor and Mellon are directed to pay from the bank account maintained at Sabadell United Bank, which has been reported in the Debtor's Standard Monthly Operating Report for the month of December 2010. About Maysville, Inc. Miami, Florida-based Maysville, Inc., filed for Chapter 11 bankruptcy protection on June 28, 2010 (Bankr. S.D. Fla. Case No. 10-28244). Stan Riskin, Esq., who has an office in Plantation, Florida, assists the Debtor in its restructuring effort. The Company disclosed $24,690,000 in assets and $20,225,364 in liabilities as of the Petition Date. MESA AIR: Court Enters Post-Confirmation Order ---------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York entered an order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its affiliated debtors on January 20, 2011. Judge Glenn states that it is the Debtors' responsibility to inform the Court of the progress made toward consummation of the Plan under Section 1101(2) of the Bankruptcy Code; entry of a final decree under Rule 3022 of the Federal Rules of Bankruptcy Procedure; and case closing under Section 350 of the Bankruptcy Code. In a post-confirmation order and notice, dated February 1, 2011, the Court orders the Debtors to comply with the submission of these documentation and reports: (a) The Debtors will file by April 15, 2011, the initial status report detailing the actions taken by the Debtors and the progress made toward the consummation of the Plan. Reports will be filed thereafter every January 15th, April 15th, July 15th, and October 15th until a final decree has been entered. The Debtors will file post-confirmation operating reports as an exhibit to the Periodic Status Reports until the cases are closed. (b) The Debtors will serve a copy of the Confirmation Order and the Post-Confirmation Order to the (1) Office of the U.S. Trustee for the Southern District of New York, (2) the counsel of the Official Committee of Unsecured Creditors, Morrison & Foerster LLP, and (3) parties entitled to notice pursuant to the Court's January 15, 2010 order establishing notice procedures in these Chapter 11 cases. (c) Within 45 days following the distribution of any deposit required by the Plan or, if no deposit was required, upon the payment of the final distribution required by the Plan, the Debtors will file a closing report in accordance with Local Bankruptcy Rule 3022-1 and an application for a final decree. (d) The Debtors will submit the requested information, including a final decree closing the case, within one year from the date of the Confirmation Order, by January 20, 2012. If the Debtors fail to comply with the Post- Confirmation Order, the Bankruptcy Clerk will so advise the Court and an order to show cause may be issued. The Debtors may, however, seek authorization to extend the period set forth in the Post-Confirmation Order. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on January 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MESA AIR: Court Okays Delta Air Claims Settlement ------------------------------------------------- Judge Martin Glenn granted Mesa Air's motion to approve the determination, settlement, and allowance of certain claims of Delta Air Lines, Inc. The Debtors are authorized to settle the Delta Claims and Prepetition Delta Actions. Among other things, (i) Delta's Claim No. 782 against Mesa Air Group, Inc., is allowed as a general unsecured claim for $3,282 and the remainder of that claim is disallowed and will be deemed withdrawn and expunged; and (ii) Delta's Claim No. 783 against Freedom Airlines, Inc., is allowed as a general unsecured claim for $7,261,742 and the remainder of that claim is disallowed and will be deemed withdrawn and expunged. The allowance of Claim Nos. 782 and 783 will not affect the Debtors' rights of offset, recoupment, or any other means by which allowed claims may be reduced under the Bankruptcy Code or under applicable non-bankruptcy law. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on January 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MESA AIR: Reaches Plan Settlement With BF Claims Holdings --------------------------------------------------------- Mesa Air Group Inc. entered into a Court-approved stipulation and agreement with (i) BF Claims Holdings I LLC and (ii) Brigade Leveraged Capital Structures Fund Ltd., Kitty Hawk Master Funds Ltd., Kitty Hawk Master Fund II Ltd., and Kitty Hawk Onshore Fund LP. Brigade, Kitty Hawk Master Funds, Kitty Hawk Master Fund II, and Kitty Hawk Onshore Fund are collectively referred to as the Funds. BF Holdings and the Funds are collectively referred to as the Fund Entities. On January 26, 2010, pursuant to Sections 105, 362 and 541 of the Bankruptcy Code, the Court entered the Trading Order establishing the notification and hearing procedure for trading in claims and equity securities. On November 23, 2010, the Court approved the Debtors' Disclosure Statement to the Second Amended Joint Plan of Reorganization, dated November 23, 2010. On August 4, 2010, U.S. Bank National Association, which held a security interest in certain lease rejection claims against Mesa Air Group, Inc., and Mesa Airlines, Inc., entered into a transfer of claims agreement with the Funds, excluding Kitty Hawk Onshore Fund. The applicable parties agreed to certain conditions with respect to the occurrence of a "Closing Date." The consummation of the purchase and the sale of two aircraft that were the subject of leases -- out of which the lease rejection claims arose -- occurred on August 9 and November 18, 2010. On December 23, 2010, the Funds filed their Notices of Intent to Purchase, Acquire or Otherwise Accumulate a Claim with respect to claims against Mesa Air Group and Mesa Airlines, from certain aircraft debt parties. The Debtors waived the 30-day notice period under the Trading Order with respect to the consummation of the transfer of Claims. On January 3, 2011, the Funds entered into an assumption and assignment agreement with BF Holdings in which the Funds assigned all of their "right, title and interest in and to the Transfer of Claims Agreement and the Mesa Claims" to BF Holdings, and BF Holdings "assumes all of the obligations under, and agrees to be bound to the same extent as" the Funds under the Transfer of Claims Agreement. BF Holdings was formed by the Funds solely for the purpose of acquiring and holding the Claims for the benefit of the Funds as their "designee." The Debtors believe that the Closing Date under the Transfer of Claims Agreement and the transfer of the Claims occurred on December 23, 2010, immediately upon the waiver of the 30-day notice period prescribed by the Trading Order. As a result, the Debtors believe that the Claims were initially transferred to the Funds -- excluding Kitty Hawk Onshore Fund insofar as the Transfer of Claims Agreement is concerned -- and that the Assignment Agreement would have had the effect of transferring the Claims from the Funds -- excluding Kitty Hawk Onshore Fund insofar as the Transfer of Claims Agreement is concerned -- to BF Holdings if the Assignment Agreement had not been rendered void by the terms of the Trading Order. BF Holdings maintains that pursuant to the Assignment Agreement, it became the counterparty under the Transfer of Claims Agreement and replaced the Funds -- excluding Kitty Hawk Onshore Fund -- before the closing under the Transfer of Claims Agreement and then took title to the Claims directly from US Bank, as foreclosing mortgagee, under the Transfer of Claims Agreement. To recall, on January 4, 2011, BF Holdings filed its Objection to Plan Confirmation and Approval of Related Plan Supplement Documents. BF Holdings filed its Memorandum of Law and Pretrial Memorandum on January 12, 2011, in further support of its objection to confirmation of the Debtors' Second Amended Plan. On January 12, 2011, the Debtors filed their Opposition Brief Pretrial Memorandum of Law and Response to BF Claims Holding I LLC's Objection to Plan Confirmation and Approval of Related Plan Supplement Documents. They argued that the transfer of the Claims to BF Holdings was in violation of the procedures prescribed by the Trading Order; the purported transfer of the Claims to BF Holdings was void ab initio; and BF Holdings was not a creditor and did not have standing to object to the Plan. BF Holdings then filed with the Court certain evidences of transfer of the Claims from US Bank to BF Holdings, dated January 11, 2011. The Debtors filed their Third Amended Joint Plan of Reorganization on January 19, 2011, as well as the Amended Plan Supplement. On January 20, 2011, the Court overruled the BF Holdings Objection on the merits, finding that BF Holdings lacked standing on account of its failure to comply with the procedures prescribed by the Trading Order. On the same day, the Court also confirmed the Debtors' Third Amended Plan. On January 25, 2011, as a consequence of the Court's Memorandum Decision and because the "Distribution Record Date" was January 25, 2011, with the cooperation of US Bank, the Funds maintain that they closed the purchase of the Claims in the name of the Funds. The Funds then filed with the Court evidences of transfer from the Sellers as prescribed by Bankruptcy Rule 3001(e)(2) with respect to the Claims and additional claims subject to separate claim transfer agreements aggregating $115,000,000. BF Holdings has indicated that it intends to seek re-argument or reconsideration of the Court's Memorandum Decision or file an appeal of the Confirmation Order. To avoid the delay, cost, and uncertainty associated with a potential motion for re-argument or reconsideration, the Debtors and the Funds agreed that they will request the Court to vacate its finding that BF Holdings lacked standing for failure to comply with the procedures prescribed by the Trading Order. The salient terms of the Stipulation and Agreement include: * The Original Evidences of Transfer filed by BF Holdings are deemed withdrawn and have no force or effect now or in the future. * The portion of the Memorandum Decision relating to the Court's finding that BF Holdings did not have standing and violated the Trading Order is vacated. The vacature does not result in the transfer of the Claims to BF Holdings now or in the future, and the Claims subject to the Funds' Evidences of Transfer will continue to be held by the Funds and will be subject to the restrictions set forth by the Trading Order and the Third Amended Plan. * The Fund Entities waive and forever release any and all rights, if any, to appeal, seek reconsideration or re- argument of, or participate in other motion practice with respect to the Memorandum Decision and Confirmation Order. * Each party will be responsible for its respective costs and expenses incurred in negotiation, drafting, and executing the Stipulation and Agreement. The Official Committee of Unsecured Creditors supports the entry of the Stipulation and Agreement. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on January 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MOMENTIVE SPECIALTY: Completes Sale of IAR Business to Harima ------------------------------------------------------------- Momentive Specialty Chemicals Inc. has completed the sale of its global Ink & Adhesive Resins (IAR) business to Harima Chemicals, Inc., a leading producer of pine-based products. The IAR business had 2009 annual revenues of $279 million and is one of the world's leading suppliers of resins and additives to the graphics arts, adhesives, aroma chemical, synthetic rubber and specialty coating industries. Harima's purchase included the complete business including 11 manufacturing facilities on five continents and the IAR global product portfolio. The IAR management team and approximately 650 global associates also joined Harima at closing. The PrinceRidge Group LLC served as transaction advisor and O'Melveny & Myers LLP served as legal advisor to Momentive. About Harima Chemicals, Inc. Based in Tokyo, Japan, Harima Chemicals is a leading global producer of pine-based products, synthetic resins, papermaking chemicals, tall oil products and electronic materials. The company was founded in 1947 and is publicly traded on the Tokyo and Osaka stock exchanges. Additional information is available at www.harima.co.jp/en/ About Momentive Specialty Momentive Specialty Chemicals, Inc., headquartered in Columbus, Ohio, is a leading producer of thermoset resins (epoxy, formaldehyde and acrylic). The company is also a supplier of specialty resins for inks and specialty coatings sold to a diverse customer base as well as a producer of commodities such as formaldehyde, bisphenol A, epichlorohydrin, versatic acid and related derivatives. The Company's balance sheet at Sept. 30, 2010, showed $3.22 billion in total assets, $5.20 billion in total liabilities, and a stockholders' deficit of $1.99 billion. Momentive Specialty carries a 'B-' issuer credit rating from Standard & Poor's Ratings Services. It has 'B3' corporate family and probability of default ratings from Moody's Investors Service. corporate credit rating from Standard & Poor's. As reported in the October 27, 2010 edition of TCR, Moody's Investors Service assigned a 'Caa1' rating to the guaranteed senior secured second lien notes due 2020 of Momentive Specialty Chemicals Inc. (formerly known as Hexion Specialty Chemicals Inc.). Proceeds from the notes were allocated for the repayment of $533 million of guaranteed senior secured second lien notes due 2014. "With this refinancing Hexion will have refinanced or extended the maturities on the vast majority of the debt that was originally slated to mature prior to 2015. There is less than $600 million of this debt remaining, which should be much easier to for the company to refinance as its credit metrics improve further," stated John Rogers, Senior Vice President at Moody's. MONEYGRAM INT'L: Reports $16.16MM Net Income in Fourth Quarter --------------------------------------------------------------- On February 4, 2011, MoneyGram International, Inc., announced fourth quarter and full-year 2010 financial results. The Company reported net income of $16.16 million on $303.37 million of total revenue for the three months ended December 31, 2010, compared with net income of $7.87 million on $295.62 million of total revenue for the same period a year ago. The Company also reported net income of $43.80 million on $1.17 billion of total revenue for the year ended December 31, 2010, compared with a net loss of $1.91 million on $1.16 billion of revenue during the prior year. The Company's balance sheet at December 31, 2010, showed $5.12 billion in total assets, $5.06 billion in total liabilities, $999.35 million in mezzanine equity and $942.48 million in total stockholders' deficit. "We are pleased with MoneyGram's fourth-quarter financial performance, and we are excited with our position exiting 2010," said Pamela H. Patsley, chairman and chief executive officer. "We're a stronger company than a year ago, more focused on our strategies and better positioned for growth. We are strengthening our core business, increasing money transfer transactions, taking out costs and continuing to see general economic improvements in many markets." A full-text copy of the Company's press release announcing financial results is available at no charge at: http://ResearchArchives.com/t/s?7312 About MoneyGram International MoneyGram International, Inc. (NYSE: MGI) -- http://www.moneygram.com/-- is a leading global payment services company. The Company's major products and services include global money transfers, money orders and payment processing solutions for financial institutions and retail customers. MoneyGram is a New York Stock Exchange listed company with 203,000 global money transfer agent locations in 191 countries and territories. The Company's balance sheet as of June 30, 2010, showed $5.461 billion in total assets, $5.450 billion in total liabilities, $929.2 million in total mezzanine equity, and a stockholders' deficit of $918.0 million. * * * According to the Troubled Company Reporter on July 1, 2010, Fitch Ratings has affirmed the Issuer Default Ratings for MoneyGram International Inc. and MoneyGram Payment Systems Worldwide, Inc., at 'B+'. Outlook is stable. Fitch noted that the ratings could be negatively impacted by further declines in remittance volumes driven by macro economic factors or decreases in migrant labor populations worldwide. MONTECITO AT MIRABEL: Dismissal Motion Set for Hearing March 29 --------------------------------------------------------------- U.S. Bankruptcy Court for the District of Arizona will continue the hearing on March 29, 2011, at 10:30 a.m., at 230 N. First Ave., 7th Floor, Courtroom 702, Phoenix, Arizona, to consider the request to dismiss the Chapter 11 case of Montecito At Mirabel Development, L.L.C., filed by Shelton L. Freeman of Deconcini McDonald Yetwin & Lcay PC. About Montecito At Mirabel Mesa, Arizona-based Montecito At Mirabel Development, L.L.C. -- dba Montecito @ Mirabel Development, LLC -- filed for Chapter 11 bankruptcy protection on December 31, 2009 (Bankr. D. Ariz. Case No. 09-33899). Randy Nussbaum, Esq., at Nussbaum & Gillis, P.C., assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. MORGANS HOTEL: Massachusetts Financial Holds 7.2% Equity Stake -------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, Massachusetts Financial Services Company disclosed that it beneficially owns 2,188,610 shares of common stock of Morgans Hotel Group Co., consisting of shares beneficially owned by MFS or certain other non-reporting entities, representing 7.2% of the shares outstanding. The number of shares outstanding of the Company's common stock, par value $0.01 per share, as of November 8, 2010 was 30,243,380. About Morgans Hotel Group Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) -- http://www.morganshotelgroup.com/-- is widely credited as the creator of the first "boutique" hotel and a continuing leader of the hotel industry's boutique sector. Morgans Hotel Group operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and Shore Club in South Beach, Mondrian in Los Angeles and South Beach, Clift in San Francisco, Ames in Boston, and Sanderson and St Martins Lane in London. Morgans Hotel Group and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans Hotel Group also manages hotels in Isla Verde, Puerto Rico and Playa del Carmen, Mexico. Morgans Hotel Group has other property transactions in various stages of completion, including projects in SoHo, New York and Palm Springs, California. The Company's balance sheet at Sept. 30, 2010, showed $759.10 million in total assets, $801.22 million in total liabilities, and a stockholders' deficit of $42.12 million. Morgans Hotel reported a net loss of $37.08 million on $57.74 million of total revenues for the three months ended Sept. 30, 2010, compared with a net loss of $27.82 million on $56.42 million of total revenues for the same period a year ago. MPG TRUST: Edward J. Ratinoff Does Not Own Any Securities --------------------------------------------------------- In a Form 3 filing with the U.S. Securities and Exchange Commission on February 4, 2011, Edward James Ratinoff, a director at MPG Office Trust, Inc., disclosed that he does not own any securities of the Company. About MPG Office Trust MPG Office Trust, Inc., fka Maguire Properties Inc. -- http://www.mpgoffice.com/-- is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high- quality office properties in the Southern California market. MPG Office Trust is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. The Company's balance sheet at Sept. 30, 2010, showed $3.26 billion in total assets, $4.16 billion in total liabilities, and a stockholders' deficit of $897.21 million. The Company has been focused on reducing debt, eliminating repayment and debt service guarantees, extending debt maturities and disposing of properties with negative cash flow. The first phase of the Company's restructuring efforts is substantially complete and resulted in the resolution of 18 assets, relieving the Company of approximately $2.0 billion of debt obligations and potential guaranties of approximately $150 million. MTR LEASING: Files Schedules of Assets and Liabilities ------------------------------------------------------ MTR Leasing LLC delivered its schedules of assets and liabilities to the U.S. Bankruptcy for the Western District of Washington, disclosing: Name of Schedule Assets Liabilities ---------------- ------------ ----------- A. Real Property B. Personal Property $10,609,376 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $6,346,340 E. Creditors Holding Unsecured Priority Claims F. Creditors Holding Unsecured Non-priority Claims $4,076,801 ------------ ------------ TOTAL $10,609,376 $10,423,141 A full-text copy of the Schedules of Assets and Liabilities is available for free at http://ResearchArchives.com/t/s?730e Seattle, Washington-based MTR Leasing, LLC, filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. W.D. Wash. Case No. 10-23761). George S Treperinas, Esq., at Karr Tuttle Campbell, assures the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. Affiliate Frederick D. Berg (Bankr. W.D. Wash. Case No. 10-18668) filed separate Chapter 11 petition on July 27, 2010. MYPHOTOPIPE.COM: Files for Chapter 11 Protection ------------------------------------------------ MyPhotopipe.com, Inc. filed for Chapter 11 protection in Phoenix (Bankr. D. Ariz. Case No. 11-03092). The Company is represented by Daniel E. Garrison of Andante Law Group of Daniel E. Garrison, PLLC. MyPhotopipe.com, Inc., is an operator of an online photo print processing lab. NATIONAL HOME: Objects to Committee's Plan; Hearing Set for Feb 23 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Western District of Arkansas continued to February 23, 2011, at 10:30 a.m. the hearing on the objection of Debtor National Home Centers, Inc., to the confirmation of the official committee of unsecured creditors' plan of liquidation filed December 7, 2010, on behalf of the Debtor. National Home Centers, Inc., objects to the Committee's Plan on the following grounds: 1. the Committee's Plan fails to meet the requirements of Section 1129(a) and the Bankruptcy Code. 2. the appointment of an out-of-state Liquidating Trustee is inconsistent with the interest of creditors and only serves to increase the cost of liquidation and therefore fails to comply with Section 1129(a)(5)(ii). 3. the Plan improperly provides that certain priority claims are unimpaired under Section 1124 and denies priority creditors -- including the Debtor's former employees -- the right to vote on the Plan and fails to comply with Section 1129(a)(8). 4. The conditions to Effective Date of the Committee's Plan as set forth in Article 8 of the Committee's Plan render the timing of payments to creditors who must be paid upon the effective date speculative and cause the Committee's Plan to lack sufficient certainty regarding its terms and treatment (including impairment) of creditors. 5. The Committee's Plan is not in the best interest of creditors and fails to comply with Section 1129(a)(7). Committee's Plan The Committee's Plan provides for the transfer of all of the estate's assets into the Liquidating Trust which will, among other things, have the responsibility for liquidating certain assets, pursuing causes of action, reconciling Claims and distributing the assets of the estate to the holders of allowed claims in accordance with the Plan. The Liquidating Trust will be under the full control of the Liquidating Trustee as provided in the Plan, subject to the limitations set forth in the Plan and the Liquidating Trust Agreement. Pursuant to the terms of the Plan and the Liquidating Trust, David Jones, Esq., will be appointed as the Liquidating Trustee of the Liquidating Trust. Pursuant to the Plan terms, holders of Allowed Secured Claims against the Debtor will, at the option of the Liquidating Trustee, either receive cash or receive the collateral securing their Claim. The Committee's current estimate of the aggregate amount of Secured Claims against the Debtor is $0. General Unsecured Claims will receive a pro rata share of all Distributable Cash. Holders of the Interests or Interest Related Claims will receive no distribution or dividend. A copy of the Amended Disclosure Statement with respect to the Unsecured Creditors Committee's Plan of Liquidation, dated December 7, 2010, is available for free at: http://bankrupt.com/misc/NationalHome.CommitteDS.pdf About National Home Centers National Home Centers, Inc., operated retail home centers in Springdale, Russellville, Little Rock, Bentonville, North Little Rock, Conway, Fort Smith and Clarksville, Arkansas and retail flooring centers in Springdale and Conway, Arkansas. The Company filed for Chapter 11 bankruptcy protection on December 8, 2009 (Bankr. W.D. Ark. Case No. 09-76195). Charles T. Coleman, Esq., Judy Simmons Henry, Esq., and Kimberly Wood Tucker, Es., at Wright, Lindsey & Jennings LLP assist the Debtor in its restructuring effort. The Debtor retained CRG Management, L.L.C., as its financial advisors in its Chapter 11 case. Michael Traison, Esq., and Marc N. Swanson, Esq., at Miller, Canfield, Paddock & Stone, P.L.C., in Chicago, Ill., and David Nixon, Esq., at The Nixon Law Firm, in Fayetteville, Ark., represent the official committee of unsecured creditors as counsel and local counsel, respectively. In its schedules, the Debtor disclosed $42,427,298 in assets and $26,986,359 in liabilities. NCOAT INC: Wants to Extend Plan Filing Deadline to May 14 --------------------------------------------------------- nCoat Inc and its debtor-affiliates ask the U.S. Bankruptcy Court for the Middle District of North Carolina to further extend their exclusive periods to file a Chapter 11 plan until May 14, 2011, and solicit acceptances of that plan until July 13, 2011. A hearing is set for March 3, 2011, at 9:30 a.m., in Courtroom 3, Second Floor, 101 South Edgeworth Street, Greensboro, North Carolina, to consider the Debtors' extension request. The Debtors say they have liquidated substantially all tangible and intangible assets and ceased business operations. However, the Official Committee of Unsecured Creditors has requested that the Debtors preserve certain business records so that potential causes of action can be identified, evaluated and, if appropriate, pursued by the Debtors or the Committee. The Committee has requested Rule 2004 examinations to evaluate the potential causes of action The Debtors relate that, in order to complete the review and tailor any proposed plan in light of any developments in this regard, they request an extension of 90 days for each of the exclusive periods. This requested extension is well within the maximum period permitted by Section 1121 of the Bankruptcy Code About nCoat Inc. nCoat, Inc., filed for Chapter 11 protection on August 16, 2010 (Bankr. M.D. N.C. Case No. 10-11512). John A. Northen, Esq., and Vicki L. Parrott, Esq., who have offices in Chapel Hill, North Carolina, represents the Debtor. The Debtor disclosed $1,375,746 in assets and $913,619,139 in debts. Affiliates High Performance Coatings, Inc. (Bankr. M.D. N.C. Case No. 10-11515); MCC, Inc., dba Jet Hot (Bankr. M.D. N.C. Case No. 10-11514); and nTech, Inc. (Bankr. M.D. N.C. Case No. 10-11513) file separate Chapter 11 petitions on August 16, 2010. William B. Sullivan and Womble Carlyle Sandridge & Rice, PLLC, represent the Official Committee of Unsecured Creditors. NEOMEDIA TECHNOLOGIES: Andypolo Discloses 9.9% Equity Stake ----------------------------------------------------------- In separate Schedule 13D filings with the U.S. Securities and Exchange Commission on February 4, 2011, each of Andypolo, L.P., David and Judy Klein, Barry Liben and Westmount International Holdings Ltd. disclosed 9.9% equity stake in NeoMedia Technologies, Inc. The Reporting Persons beneficially own the following shares of common stock of the Company: Shares Beneficially Owned ------------------ Andypolo, L.P. 12,886,597 David and Judy Klein 5,154,639 Barry Liben 12,886,597 Westmount International Holdings Ltd 45,541,237 As of December 31, 2010, the Reporting Persons submitted a withdraw request from YA Global Investments (U.S.), LP, a hedge fund, for funds previously invested by the Reporting Persons with YA Global. On January 3, 2011, the Reporting Persons received a letter from YA Global informing it that the withdraw request would be satisfied through an in-kind distribution of securities held by YA Global. Securities received by the Reporting Persons pursuant to the In-Kind Distribution were valued by YA Global as of the close of business on December 31, 2010 at: Securities Received ------------------- Andypolo, L.P. $750,000 David and Judy Klein $300,000 Barry Liben $750,000 Westmount International Holdings Ltd $2,650,000 Based upon information provided by the Company on the January 17, 2011, 35,660,877 shares of Common stock were outstanding. The Certificate of Designation provides that each share of a Preferred Share is convertible into Common Stock of the Issuer equal to the quotient of the liquidation amount divided by the conversion price. The liquidation amount is equal to $1,000 per share of a Preferred Share. The conversion price is equal to, at the option of the holder of the Preferred Share, the lesser of (i) $.50 or (ii) 97% of the lowest closing bid price of the Common Stock for the 125 trading days immediately preceding the date of conversion, as quoted by Bloomberg LP. The Certificate of Designation further provides that no holder of the Preferred Shares will be entitled to convert the Preferred Shares to the extent that that conversion would cause the aggregate number of shares of Common Stock beneficially owned by such holder to exceed 9.99% of the outstanding shares of Common Stock following such conversion. About NeoMedia Technologies Atlanta, Ga.-based NeoMedia Technologies, Inc., provides mobile barcode scanning solutions. The Company's technology allows mobile devices with cameras to read 1D and 2D barcodes and provide "one click" access to mobile content. The Company's balance sheet at September 30, 2010, showed $9.04 million in total assets, $83.31 million in total liabilities, $8.37 million in Series C convertible preferred stock, $2.50 million in Series D convertible preferred stock, and a stockholders' deficit of $85.14 million. At September 30, 2010, the Company has an accumulated deficit of $237.99 million. The Company also has a working capital deficit of $82.05 million, of which of which $68.51 million is related to the Company's financing instruments, including $30.71 million related to the fair value of warrants and those debentures that are recorded as hybrid financial instruments, and $37.80 million related to the amortized cost carrying value of certain of the Company's debentures and the fair value of the associated derivative liabilities. As reported in the Troubled Company Reporter on April 1, 2010, Kingery & Crous, P.A., in Tampa, Fla., expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations and has ongoing requirements for additional capital investment. NEOMEDIA TECHNOLOGIES: YA Global Discloses 9.9% Equity Stake ------------------------------------------------------------ In a Schedule 13D filing with the U.S. Securities and Exchange Commission on February 4, 2011, YA Global Investments, L.P. disclosed that it beneficially owns 0 shares of common stock of NeoMedia Technologies, Inc. representing 9.9% of the shares outstanding. YA Global Investments, L.P. does not own any shares of Common Stock. As the Investment Manager of YA Global, Yorkville Advisors, LLC may be deemed to beneficially own the same amount of shares of Common Stock beneficially owned by YA Global. As the General Partner to YA Global, Yorkville Advisors GP, LLC may be deemed to beneficially own the same amount of shares of Common Stock beneficially owned by YA Global. As the president of Yorkville and Yorkville GP and as the portfolio manager to YA Global, Mark Angelo may be deemed to beneficially own the same amount of shares of Common Stock beneficially owned by YA Global and YA Global GP. YA Global is the owner of derivative securities which have a cap that prevents each derivative security from being converted or exercised if that conversion or exercise would cause the aggregate number of shares of Common Stock beneficially owned by YA Global and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following that conversion or exercise of the derivative security. In addition, the cap pertaining to the derivative securities limits YA Global's entitlement to 9.9% of the Common Stock Deemed Outstanding of the Company for purposes of any corporate vote. Angelo is the direct owner of 375 shares of the Company's Series C 8% Convertible Preferred Stock, par value $.01 per share, dated February 17, 2006. Angelo obtained the Preferred Shares as of December 31, 2010, in which Angelo submitted a withdraw request from YA Global Investments (U.S.), LP, a hedge fund, for funds previously invested by Angelo. On January 3, 2011, Angelo received a letter from YA Global U.S. informing him that the withdraw request would be satisfied through an in-kind distribution of securities held by YA Global. Securities received by the Reporting Person pursuant to the In-Kind Distribution were valued by YA Global U.S. as of the close of business on December 31, 2010 at $375,000. Angelo received 375 shares of the Preferred Shares of the Issuer valued by YA Global U.S. at $375,000. As a result of the In-Kind Distribution, Angelo may be deemed to have acquired beneficial ownership of 375 shares of Preferred Shares. The Certificate of Designation of the Preferred Shares provides that each share of the Preferred Shares is convertible into Common Stock of the Issuer equal to the quotient of the liquidation amount divided by the conversion price. The liquidation amount is equal to $1,000 per share of a Preferred Share. The conversion price is equal to, at the option of the holder of the Preferred Share, the lesser of (i) $.50 or (ii) 97% of the lowest closing bid price of the Common Stock for the 125 trading days immediately preceding the date of conversion, as quoted by Bloomberg LP. The Certificate of Designation further provides that no holder of the Preferred Shares will be entitled to convert the Preferred Shares to the extent that such conversion would cause the aggregate number of shares of Common Stock beneficially owned by such holder to exceed 9.99% of the outstanding shares of Common Stock following such conversion. Assuming a conversion price of $0.0582, if Angelo converted as of the February 3, 2011, the Reporting Person would own 6,443,299 shares of Common Stock of the Company which would represent approximately 15.3% of the total shares of Common Stock outstanding at such time, based on 35,660,877 shares of Common Stock outstanding as informed by the Issuer on January 17, 2011. However, as noted above, the Certificate of Designation prohibits the Reporting Person from converting the Preferred Shares to the extent such conversion would result in the Reporting Person, beneficially owning in excess of 9.9% of the then and outstanding shares of Common Stock. YA Global may be deemed to beneficially own the 375 Preferred Shares beneficially owned by Angelo, as he is the president of Yorkville and the investment manager to YA Global and the portfolio manager to YA Global. Yorkville Advisors may be deemed to beneficially own the 375 Preferred Shares owned by Angelo, as he is the president of Yorkville. About NeoMedia Technologies Atlanta, Ga.-based NeoMedia Technologies, Inc., provides mobile barcode scanning solutions. The Company's technology allows mobile devices with cameras to read 1D and 2D barcodes and provide "one click" access to mobile content. The Company's balance sheet at September 30, 2010, showed $9.04 million in total assets, $83.31 million in total liabilities, $8.37 million in Series C convertible preferred stock, $2.50 million in Series D convertible preferred stock, and a stockholders' deficit of $85.14 million. At September 30, 2010, the Company has an accumulated deficit of $237.99 million. The Company also has a working capital deficit of $82.05 million, of which of which $68.51 million is related to the Company's financing instruments, including $30.71 million related to the fair value of warrants and those debentures that are recorded as hybrid financial instruments, and $37.80 million related to the amortized cost carrying value of certain of the Company's debentures and the fair value of the associated derivative liabilities. As reported in the Troubled Company Reporter on April 1, 2010, Kingery & Crous, P.A., in Tampa, Fla., expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations and has ongoing requirements for additional capital investment. NEW STREAM: 3 Law Firms Represent Investors Opposing Ch. 11 Plan ---------------------------------------------------------------- Toptani Law Offices, Mazzeo Song & Bradham LLP and Stevens & Lee, P.C. will represent a group of investors that will take formal legal action to oppose the proposed pre-packaged bankruptcy plan of New Stream Capital, L.P., a Connecticut based hedge fund that once boasted firm-wide assets of $1.2 billion. Several months ago, New Stream announced that it had entered into an agreement with its Bermuda investors to liquidate its master fund, and that upon the consent of its US and Cayman investors, it would voluntarily file Chapter 11 bankruptcy petitions. However, the US and Cayman investors only recently received a formal Plan of Reorganization and Disclosure Statement describing the terms of New Stream's proposed liquidation. On Monday, New Stream announced an amendment to the Disclosure Statement, thereby extending the time by which US and Cayman investors must cast their ballots with respect to the Plan from Feb. 22 to March 8. The investor group opposing New Stream's Plan is comprised of US and Cayman investors who invested nearly $90 million in New Stream after it announced a new fund structure at the end of 2007. The investor group identifies four main concerns with the proposed Plan and in sum, the investor group believes that the Plan presents a woefully inequitable division of New Stream's remaining assets and is contrary to applicable law. First, the Bermuda investors are receiving far too large a percentage of New Stream's remaining assets on account of their allegedly senior secured position because: (a) when the US and Cayman investors invested in the current fund structure, they relied on New Stream's assurances that all investors would be treated pari passu and (b) a substantial portion of the investments made by the US and Cayman investors -- who contributed nearly one-half of New Stream's total investment capital -- was used to purchase and maintain life insurance assets that the Bermuda investors now claim as their collateral. These life insurance assets, which were valued by New Stream at $350 million, are being sold for $127.5 million, the proceeds of which will be distributed to the Bermuda investors under the Plan. As a result, it is likely that the US and Cayman investors will receive less than 5% of New Stream's remaining assets, while the Bermuda investors will receive at least 95%. Second, those few assets that are being distributed to the US and Cayman investors under the Plan appear to be grossly overvalued. In particular, the allegedly most significant asset being distributed to the US and Cayman investors is the common stock in a company called NorthStar Financial Services Ltd. The Disclosure Statement values NorthStar at up to $40 million, but less than a year ago, New Stream's President, Perry Gilles, submitted a sworn affidavit in the Bermuda Supreme Court in which he testified that a sale of NorthStar in 2009 would have required payment to the purchaser of up to $75 million. Third, several valuable causes of action to rectify these and other injustices are being released under the Plan without adequate consideration. For example, Mr. Gilles also testified by sworn affidavit in the Bermuda litigation that New Stream regularly commingled its assets without regard to legal ownership between the different New Stream entities. Furthermore, he vigorously advocated that in a bankruptcy case the US and Cayman investors would be able to assert good claims for substantive consolidation and/or equitable subordination to equalize the distribution of assets. Fourth, New Stream management and other insiders are receiving unwarranted benefits under the proposed Plan: (a) they are being released from all investor and creditor claims without any adequate consideration, (b) $2 million is being set aside for management to respond to an ongoing SEC investigation (as well as any administrative, regulatory or criminal investigation against the debtors or their former or current managers, officers, directors and employees, and to pay defense costs not paid by insurance carriers), (c) the debtors are indemnifying their managers, officers, directors and employees, (d) management will receive additional fees and management roles in various new entities, and (e) New Stream's attorney-client privilege is being preserved, which will likely benefit only the insiders and hinder investigations into any insider malfeasance. By seeking to induce US and Cayman investors to relinquish the significant claims they hold, New Stream is promoting an inequitable Plan that provides a cash windfall for the Bermuda investors and releases its management from liability. The investor group will vigorously oppose this result. New Steam has represented to investors that those investors who abstain from voting will automatically be deemed to have cast their votes in opposition to the Plan. However, the Disclosure Statement provides otherwise. Therefore, investors who wish to oppose the Plan must return their ballots marked "NO" on or before March 8, 2011 by 5:00 p.m. (PST). New Stream Capital, L.P., is a Connecticut based hedge fund. NORTEL NETWORKS: Employees Challenge $38-Millon Deferred-Pay Grab ----------------------------------------------------------------- Bankruptcy Law360 reports that a group of Nortel Networks Inc.'s former employees is challenging the bankrupt telecom's bid to distribute $38 million to unsecured creditors that was held in trust from an employee deferred-compensation plan. According to Law360, the employees contended the plan was subject to protections under the Employee Retirement Income Security Act that would prevent Nortel's estate from accessing the funds. About Nortel Networks Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel Networks divested off key assets while in Chapter 11. In March 2009, the U.S. Bankruptcy Court entered an order approving the sale of the Layer 4-7 assets to Radware Ltd. as the successful bidder at auction. In July 2009, Nortel sold its CDMA and LTE-related assets to Telefonaktiebolaget LM Ericsson (Publ). In September 2009, the Court Nortel sold its Enterprise Solutions business to Avaya Inc. In October 2009, the Court approved the sale of assets associated with Nortel's Next Generation Packet Core network components to Hitachi, Ltd. On December 2, 2009, the Court approved the sale of assets associated with Nortel's GSM/GSM-R business to Telefonaktiebolaget LM Ericsson (Publ) and Kapsch Carriercom AG. In December 2009, the Debtors sold their Metro Ethernet Networks business to Ciena Corporation. In March 2010, Nortel sold its Carrier Voice Over IP and Application Solutions business to GENBAND Inc. In September 2010, Nortel sold its Multi-Service Switch business to Ericsson. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. NOVADEL PHARMA: Amends Form S-1; To Sell 40MM Common Shares ----------------------------------------------------------- On February 4, 2011, Novadel Pharma Inc. filed with the U.S. Securities and Exchange Commission Amendment No. 3 to the Form S-1 registration statement originally filed with the SEC on October 21, 2010. The Company said it is offering up to 4,000 shares of the Company's Series A Convertible Preferred Stock, convertible into up to 40,000,000 shares of the Company's common stock, par value $0.001 per share, together with Warrants to purchase up to 40,000,000 shares of the Company's common stock, to purchasers in the offering. The maximum number of shares of common stock underlying the convertible preferred stock and the warrants issued in the offering is 80,000,000; provided, however, the Company is not registering the 40,000,000 shares issuable upon exercise of the warrants. Each share of convertible preferred stock the Company sells will be accompanied by a warrant to purchase one (1) share of common stock for each share of common stock issuable upon conversion of the preferred stock. The Company's common stock is presently quoted on the Over-the- Counter Bulletin Board under the symbol "NVDL.OB". The Company does not intend to apply for listing of the convertible preferred stock and warrants on any securities exchange or market. On February 3, 2011, the last reported sale price of the Company's common stock as reported by the Over-the-Counter Bulletin Board was $0.17 per share. About NovaDel Pharma Bridgewater, N.J.-based NovaDel Pharma Inc. (OTC BB: NVDL) -- http://www.novadel.com/-- is a specialty pharmaceutical company developing oral spray formulations for a broad range of marketed pharmaceuticals. The Company's balance sheet at September 30, 2010, showed $2.06 million in total assets, $9.10 million in total liabilities, and a stockholders' deficit of $7.04 million. As reported in the Troubled Company Reporter on April 6, 2010, J.H. Cohn LLP, in Roseland, N.J., expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2009 results. The independent auditors noted of the Company's recurring losses from operations and negative cash flows from operating activities. NOVADEL PHARMA: Zolpimist Oral Spray Launched in U.S. ----------------------------------------------------- NovaDel Pharma Inc. announced that Zolpimist Oral Spray has been launched in the United States by ECR Pharmaceuticals, a subsidiary of Hi-Tech Pharmacal Co., Inc. ECR Pharmaceuticals announced the immediate availability of Zolpimist Oral Spray, a novel delivery system of the most widely prescribed sleep aid in the US, zolpidem tartrate. The Zolpimist Oral Spray unit contains 60 metered sprays and provides the flexibility of administering either a 5 or 10 mg dose of the zolpidem active ingredient. As with most prescription hypnotic agents, Zolpimist Oral Spray is federally classified as a CIV controlled substance. Zolpimist is only available by prescription. Steven B. Ratoff, Chairman and CEO said, "We are pleased to have Zolpimist available in the U. S. marketplace." Hi-Tech President and CEO David Seltzer indicated that "Zolpimist is a significant addition to ECR, our branded products subsidiary, and reflects our continuing commitment to build this segment of our business through the marketing of widely used, innovative products." Over 79 million prescriptions are written annually in the US for sleep aid products. About Hi-Tech Pharmacal Co., Inc. \Hi-Tech is a specialty pharmaceutical company developing, manufacturing and marketing generic and branded prescription and OTC products. The Company specializes in difficult to manufacture liquid and semi-solid dosage forms and produces a range of sterile ophthalmic, otic and inhalation products. The Company's Health Care Products Division is a leading developer and marketer of branded prescription and OTC products for the diabetes marketplace. Hi-Tech's ECR Pharmaceuticals subsidiary markets branded prescription products. About NovaDel Pharma Bridgewater, N.J.-based NovaDel Pharma Inc. (OTC BB: NVDL) -- http://www.novadel.com/-- is a specialty pharmaceutical company developing oral spray formulations for a broad range of marketed pharmaceuticals. The Company's balance sheet at September 30, 2010, showed $2.06 million in total assets, $9.10 million in total liabilities, and a stockholders' deficit of $7.04 million. As reported in the Troubled Company Reporter on April 6, 2010, J.H. Cohn LLP, in Roseland, N.J., expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2009 results. The independent auditors noted of the Company's recurring losses from operations and negative cash flows from operating activities. NOVASTAR FINANCIAL: Barry Igdaloff Discloses 10.3% Equity Stake --------------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission on February 4, 2011, Barry Igdaloff disclosed that he beneficially owns 307,774 shares of 8.90 Series C Cumulative Redeemable Preferred Stock representing 10.3% of the shares outstanding. On March 17, 2009 Novastar Financial, Inc. notified the holders of the Novastar Financial 8.9% Series C preferred stock that as of March 31, 2009, they had the right to elect two directors to the Company's Board of Directors as a result of the Company's failure to pay dividends for six quarters. These limited voting rights may deem the Series C Preferred Shares to be a class of voting securities, resulting in this form 13D being filed for notice purposes. Mr. Igdaloff was elected by the Series C Preferred shareholders as a Company Director at the annual stockholders meeting held June 25, 2009. The outstanding Preferred C Shares of the Company is 2,990,000 shares as of December 10, 2010. About NovaStar Kansas City, Missouri-based NovaStar Financial, Inc. (OTCQB: Common Stock: NOVS; Series C Preferred Stock: NOVSP), is currently engaged in managing its portfolio of nonconforming residential mortgage securities and owning and operating two majority owned subsidiaries: StreetLinks National Appraisal Services LLC, a national residential appraisal and real estate valuation management services company; Advent Financial Services LLC, a start-up business which provides access to tailored banking accounts, small dollar banking products and related services to low and moderate income level individuals. Prior to 2008, NovaStar originated, securitized, sold and serviced residential nonconforming mortgage loans. The Company's balance sheet at Sept. 30, 2010, showed $41.13 million in total assets, $143.78 million in total liabilities, and a stockholders' deficit of $102.64 million. NOVELOS THERAPEUTICS: Deregisters 15.60 Million Common Shares ------------------------------------------------------------- On September 15, 2009, Novelos Therapeutics, Inc. filed a Registration Statement on Form S-1 with the Securities and Exchange Commission, which was declared effective on February 12, 2010 and subsequently amended by Post-Effective Amendment No. 1 filed on April 14, 2010. The Registration Statement initially registered the resale, from time to time, of 19,000,000 shares of the Company's common stock, par value $0.00001 per share. The Shares were registered to permit resales of those Shares by the selling stockholders, as named in the Registration Statement, who acquired preferred stock convertible into Shares in connection with the Company's private placements of the Company's Series E preferred stock in 2009. In accordance with the undertaking of the Company contained in the Registration Statement pursuant to Item 512 of Regulation S-K, the Company is filing a Post-Effective Amendment No. 2 to the Registration Statement to deregister the Shares that were previously registered under the Registration Statement, 15,601,703 of which remain unsold as of February 4, 2011. The Company is seeking to deregister these Shares because its obligations to keep the Registration Statement effective pursuant to the terms of its registration rights agreements with the selling stockholders have terminated with respect to all the Shares. The Registration Statement is amended to effect the deregistration of these 15,601,703 Shares. About Novelos Therapeutics Newton, Mass.-based Novelos Therapeutics, Inc. (OTC BB: NVLT) -- http://www.novelos.com/-- is a biopharmaceutical company developing oxidized glutathione-based compounds for the treatment of cancer and hepatitis. The Company's balance sheet at Sept. 30, 2010, showed $3.49 million in total assets, $6.36 million in total current liabilities, $375,000 in commitments and contingencies, $13.77 million in redeemable preferred stock, and a stockholders' deficit of $17.01 million. Stockholders' deficit was $16.1 million at June 30, 2010. As reported in the Troubled Company Reporter on April 8, 2010, Stowe & Degon LLC, in Westborough, Mass., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted of the Company's continuing losses and stockholders' deficiency at December 31, 2009. OMNICOMM SYSTEMS: G. van Kesteren Discloses 5.7% Equity Stake ------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission on February 4, 2011, Guus van Kesteren, a director at OmniComm Systems, Inc., disclosed that he beneficially owns 4,738,103 shares of common stock of the Company representing 5.7% of the shares outstanding. The number of shares outstanding of each of the Company's classes of common equity as of November 14, 2010 was 85,507,699 common stock $.001 par value. About OmniComm Systems Ft. Lauderdale, Fla.-based OmniComm Systems, Inc. (OTC: OMCM.OB) -- http://www.OmniComm.com/-- provides customer-driven Internet solutions to pharmaceutical, biotechnology, research and medical device organizations that conduct life changing clinical trial research. OmniComm Systems, Inc.'s balance sheet at September 30, 2010, showed total assets of $2,876,914, total liabilities of $21,122,182, and a stockholders' deficit of $18,245,268. Going Concern Doubt Greenberg & Company LLC, in Springfield, N.J., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2009 results. The independent auditors noted that the Company has incurred losses and has a net capital deficiency. PATIENT SAFETY: COO Hamilton Resigns for Personal Reasons --------------------------------------------------------- Effective February 1, John A. Hamilton will no longer be an employee of Patient Safety Technologies, Inc. Mr. Hamilton has decided to resign from the Company for personal reasons but will be working with the Company as a consultant until his responsibilities are fully transitioned. Additionally, the Company has eliminated the position of Chief Operating Officer, the position previously held by Mr. Hamilton. About Patient Safety Technologies Patient Safety Technologies, Inc. (OTC: PSTX) -- http://www.surgicountmedical.com/-- through its wholly owned operating subsidiary SurgiCount Medical, Inc., provides the Safety-Sponge(TM) System, a system designed to improve the standard of patient care and reduce health care costs by preventing the occurrence of surgical sponges and other retained foreign objects from being left inside patients after surgery. RFOs are among one of the most common surgical errors. The Company's balance sheet at Sept. 30, 2010, showed $12.02 million in total assets, $10.10 million in total liabilities, and a stockholders' equity of $1.92 million. * * * In its March 31, 2010 report, Squar, Milner, Peterson, Miranda & Williamson, LLP, in San Diego, California, noted that the Company's significant recurring net losses through December 31, 2009, and significant working capital deficit as of December 31, 2009, raise substantial doubt about the Company's ability to continue as a going concern. PEANUT CORP: Salmonella Victims Seek Criminal Case for Ex-Head -------------------------------------------------------------- Bankruptcy Law360 reports that family members of those who allegedly became ill or died after eating salmonella-tainted Peanut Corp. of America products plan to call on the federal government to bring criminal charges against the former head of the Company. Following a nationwide outbreak of Salmonella poisoning that reports say sickened more than 700 people and killed nine, Peanut Corporation of America -- http://www.peanutcorp.com/-- filed a Chapter 7 bankruptcy petition in February 2009 (Bankr. W.D. Va. Case No. 09-60452). The Company estimated its assets and liabilities in the range of $1 million to $10 million at the time of the filing. PEOPLES STATE BANK: Closed; First Michigan Bank Assumes Deposits ---------------------------------------------------------------- Peoples State Bank of Hamtramck, Mich., was closed on Friday, February 11, 2011, by the Michigan Office of Financial and Insurance Regulation, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First Michigan Bank of Troy, Mich., to assume all of the deposits of Peoples State Bank. The ten branches of Peoples State Bank will reopen during their normal business hours as branches of First Michigan Bank. Depositors of Peoples State Bank will automatically become depositors of First Michigan Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Peoples State Bank should continue to use their existing branch until they receive notice from First Michigan Bank that it has completed systems changes to allow other First Michigan Bank branches to process their accounts as well. As of December 31, 2010, Peoples State Bank had around $390.5 million in total assets and $389.9 million in total deposits. First Michigan Bank will pay the FDIC a premium of 0.25 percent to assume all of the deposits of Peoples State Bank. In addition to assuming all of the deposits of the failed bank, First Michigan Bank agreed to purchase essentially all of the assets. The FDIC and First Michigan Bank entered into a loss-share transaction on $331.0 million of Peoples State Bank's assets. First Michigan Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html Customers who have questions about the transaction can call the FDIC toll-free at 1-800-450-5143. Interested parties also can visit the FDIC's Web site at: http://www.fdic.gov/bank/individual/failed/peoplesstatebank.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $87.4 million. Compared to other alternatives, First Michigan Bank's acquisition was the least costly resolution for the FDIC's DIF. Peoples State Bank is the sixteenth FDIC-insured institution to fail in the nation this year, and the first in Michigan. The last FDIC-insured institution closed in the state was Paramount Bank of Farmington Hills, on December 10, 2010 PILGRIM'S PRIDE: Injured Worker May Pursue Claim in District Court ------------------------------------------------------------------ Bankruptcy Judge Dennis Michael Lynn ruled that Raymond Love's failure to timely file an administrative claim against Pilgrim's Pride Corporation was the result of excusable neglect. Pursuant to its authority under F.R.B.P. 9006(b)(1), the Court grants Raymond and his wife Sheila Love's application for allowance of administrative expense claim, without prejudice to assertion by the Debtors of any applicable legal defenses. Pursuant to the Order Respecting Reference signed on April 28, 2010, by U.S. District Judge Terry R. Means, Mr. Love is directed to pursue his administrative expense claim in the U.S. District Court for the Northern District of Texas, where a U.S. District Judge will determine if an arbitration proceeding is the proper means by which Mr. Love's administrative expense claim should be resolved. On August 3, 2009, Mr. Love was injured in a fall. He was employed by PPC at the time of the accident. A copy of Judge Lynn's February 8, 2011 Findings of Fact and Conclusions of Law is available at http://is.gd/nu6XkWfrom Leagle.com. About Pilgrim's Pride Pilgrim's Pride Corporation -- http://www.pilgrimspride.com/-- is one of the largest chicken companies in the United States, Mexico and Puerto Rico. The Company's fresh chicken retail line is sold throughout the US, throughout Puerto Rico, and in the northern and central regions of Mexico. The Company exports commodity chicken products to 90 countries. The Company operates feed mills, hatcheries, processing plants and distribution centers in 15 U.S. states, Puerto Rico and Mexico. Pilgrim's Pride and six of its subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code on December 1, 2008 (Bankr. N.D. Tex. Lead Case No. 08-45664). The Company's subsidiaries in Mexico and certain subsidiaries in the United States were not included in the filing and operated outside of the Chapter 11 process. Attorneys at Weil, Gotshal & Manges LLP served as bankruptcy counsel. Lazard Freres & Co., LLC, was the Company's investment bankers. Kurtzman Carson Consulting LLC served as claims and notice agent. Kelly Hart and Brown Rudnick represented the official equity committee. Attorneys at Andrews Kurth LLP represented the official committee of unsecured creditors. On December 10, 2009, the Bankruptcy Court confirmed the Joint Plan of Reorganization filed by the Debtors. The Plan was premised on the sale of the business to JBS SA. Under the Plan, creditors are paid in full. Existing owners retained 34% of the equity. The Company emerged from its Chapter 11 bankruptcy proceedings on December 28, 2009. QUEENS PLAZA: Liquidating Plan Confirmed; Feb. 17 Auction Set ------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of New York confirmed on January 31, 2011, Queens Plaza Development, LLC's Chapter 11 Plan of Liquidation dated November 5, 2010. The Bankruptcy Court set the auction date of the Debtor's Real Property for February 17, 2011. As reported in the Troubled Company Reporter on January 13, 2011, the Bankruptcy Court approved the adequacy of the information contained in the disclosure statement describing the Debtor's proposed Chapter 11 plan of liquidation. Under the Plan, secured creditor U.S. Bank, owed $15,069,624, will recover between $53% and 100%. Holders of priority claims, owed less than $3,736, will recover 100%. Holders of general unsecured claims, owed between $392,622 and $816,333, will recover between 3% and 100%. Holders of equity interests are slated to receive the remaining cash after all creditors are paid in full. A full-text copy of the Disclosure Statement, as amended, is available for free at http://ResearchArchives.com/t/s?7206 About Queens Plaza Garden City, New York-based Queens Plaza Development, LLC, a Delaware limited liability company, owns and develops a real property located at 29-37 41st Avenue, Long Island City, New York. The Debtor's sole member and manager is Queens Plaza Holdings, LLC, a Delaware Limited Liability Company. Queens Plaza Group, LLC, in turn is the managing member of Queens Plaza Holdings. The Company filed for Chapter 11 bankruptcy protection on September 8, 2010 (Bankr. E.D.N.Y. Case No. 10-77035). Thomas A. Draghi, Esq., and Jeffrey A. Miller, Esq., at Westerman Ball Ederer Miller & Sharfstein, LLP, in Uniondale, N.Y., assist the Debtor in its restructuring effort. In its schedules, the Debtor disclosed $11,000,022 in assets and $16,023,777 in liabilities as of the Petition Date. The Office of the U.S. Trustee for Region 2 notified the U.S. Bankruptcy Court for the Eastern District of New York that it was unable to appoint an official committee of unsecured creditors in the Debtor's Chapter 11 case. RADIENT PHARMACEUTICALS: Unit Closes $900,000 Bridge Financing -------------------------------------------------------------- Jade Pharmaceuticals Inc., a China-based pharmaceutical company and deconsolidated subsidiary of Radient Pharmaceuticals Corporation (NYSE Amex: RPC), a U.S.-based company specializing in the research, development, and international commercialization of In Vitro Diagnostic cancer tests, reported it has closed on $900,000 in bridge financing. The financing will be used to underwrite legal and accounting expenses associated with the previously announced anticipated merger of JPI and Shanxi BaoTai Pharmaceutical Co., Ltd. (BaoTai) 3/4 a privately-owned pharmaceutical manufacturing company located in Taiyuan, China. According to Douglas MacLellan, Chairman and CEO of RPC, "This bridge financing is an important part of our overall financing strategy that will allow us to move ahead with our planned merger with BaoTai, after which, we hope to list public shares of the newly formed organization on a public exchange. Our primary focus is to exploit the core competencies of JPI and BaoTai to ultimately build a high-growth business that delivers novel cancer-centric pharmaceutical products to global, in-demand markets." JPI is the second leading provider of DomperidoneTM 3/4 an antiemetic pharmaceutical product used to prevent nausea and vomiting caused by chemotherapy treatment or other medications given to patients. Annual Domperidone sales in China are estimated to be $250 million at the patient level, and approximately $125 million at the wholesale level, with an annual growth rate of 15%. The Company believes the combined companies will be in a strong position to gain at least 50% of the Chinese Domperidone market within the next 3 years. In addition, both companies have a solid product pipeline that should enable them to introduce a minimum of five additional cancer-centric products to market each of which has the potential to generate $50 million in gross revenues by FY2015. RPC owns approximately 98% of JPI, which is a China-based pharmaceutical company engaged in the manufacture and distribution of generic and homeopathic pharmaceutical products. JPI operates a wholly-owned Chinese subsidiary Jiangxi Jiezhong Bio-Chemical Pharmacy Company Limited (JJB). For additional information on Radient Pharmaceuticals, AMDL Diagnostics Inc., JPI and its portfolio of products visit the Company's corporate Web site at www.Radient-Pharma.com. For Investor Relations information contact Kristine Szarkowitz at IR@Radient-Pharma.com or 1.206.310.5323. 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. RAYMOND PROFESSIONAL: Dist. Court Affirms Ruling in Pope Suit ------------------------------------------------------------- The consolidated cases, Raymond Professional Group, Inc. and Raymond Professional Group - Design/Build, Inc. f/k/a Raymond Management Services, Inc., v. William A. Pope Co., Case Nos. 09 C 6037, 10 C 5325 (N.D. Ill.), are the appeals of various judgments and orders entered by the bankruptcy court in adversary proceeding 07 C 639. Pope and RMS contracted to construct a project for the owner of a power facility. RPG was not part of the deal. Pope and RMS litigated their contractual rights in an arbitration proceeding pre-bankruptcy. The arbitration panel made an award in Pope's favor. Rather than accept the panel's decision, on December 18, 2006, RPG, RMS, and several related entities filed Chapter 11 bankruptcy cases. RMS brought an adversary proceeding against Pope, in which it sought to vacate the arbitration award. RPG (later joined by RMS) also brought adversary proceeding 07 A 00639 against Pope. RPG and RMS sought a declaration that the funds in certain account are not held in trust, and sought to avoid the arbitration award as a preference. The bankruptcy court bifurcated Count VI for trial separately from the other counts, and entered judgment in Pope's favor on Count VI of the adversary complaint. The bankruptcy court found that all funds in the Account were held in trust for Pope's sole benefit, and that those funds were not property of the bankruptcy estate of either RMS or RPG. RMS and RPG filed an appeal of that judgment under case number 09 C 6037. The District Court stayed that appeal pending the bankruptcy court's resolution of the remaining counts of the adversary proceeding. On May 20, 2010, the bankruptcy court entered judgment in Pope's favor on RMS and RPG's claims in Counts II through V. The bankruptcy court concluded that those claims failed because the arbitration award did not transfer any property interest to Pope. RMS and RPG appealed the bankruptcy court's judgment as to Count III under case number 10 C 5325, which has been consolidated with case number 09 C 6037. In a February 8, 2011 Memorandum Opinion and Order, Senior District Judge George W. Lindberg affirmed the bankruptcy court's judgments and orders. Judge Linberg said RMS and RPG have not shown that they had any interest in the funds in the Account. The arbitration award did not transfer any interest of RMS to Pope, or otherwise create an interest in Pope's favor. Rather, it made a finding as to the value of Pope's pre-existing interest under the agreements between RMS and Pope. As the bankruptcy court correctly concluded, the arbitration award did not effect a transfer of RMS's property under 11 U.S.C. Sec. 547(b). Given the District Court's conclusion that the bankruptcy court did not err in finding that Pope was entitled to all of the funds in the Account, the District Court affirmed the bankruptcy court's order transferring the Account funds to a new account accessible only to Pope, and the bankruptcy court's approval of Pope's bill of costs as to Count VI of the adversary complaint. A copy of the District Court's decision is available at http://is.gd/pZJr7Ufrom Leagle.com. About Raymond Professional Group Engineering and design company Raymond Professional Group, Inc. -- http://www.raymond-co.com/-- and five of its affiliates filed Chapter 11 petitions (Bankr. N.D. Ill. Case No. 06-16748) on December 18, 2006. The Debtors are represented by Jason M. Torf, Esq., at Schiff Hardin LLP in Chicago. When the Debtors sought Chapter 11 protection, they estimated their assets and debts between $1 million and $100 million. RDK TRUCK: Asks for Court's Permission to Use Cash Collateral ------------------------------------------------------------- RDK Truck And Service, Inc., seeks authority from the U.S. Bankruptcy Court for the Middle District of Florida to use the cash collateral. Alberto F. Gomez, Jr., at Morse & Gomez, P.A., explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. At the Petition Date, the Debtor was indebted to People's United Equipment Finance Corporation approximately $6,189,974.47. People's United claims to hold an interest in the Debtor's deposit accounts, accounts receivable, inventory, chattel paper, documents, instruments and the proceeds from the sale of trucks and rental income generated from truck rentals by the Debtor's affiliate RDK Municipal Truck Center, Inc. Prepetition, the Debtor agreed to repay People's United as inventory is sold, plus monthly interest payments on the outstanding principal balance pursuant to a restructured promissory note which matured on February 1, 2011. The Debtor proposes to continue to pay People's United as inventory is sold, plus monthly interest payments at 5.25% per annum on the outstanding principal balance owed. The Debtor is current with all of its obligations owed to People's United, but is unable to operate its business without the ability to use cash, which may constitute cash collateral. At the Petition Date, the Debtor is indebted to Bay Cities Bank approximately $2,177,159.86. Bay Cities appears to be fully secured with respect to certain real estate collateral held by the Debtor's affiliates, Adamo Realty Management, LLC, and RDK Development, Inc., who own the real property which the Debtor utilizes in its business operations. Bay Cities appears to have a blanket lien against all assets of the Debtor, but that claim as it relates to cash collateral is junior or inferior to the lien of People's United and is undersecured. Bay Cities isn't entitled to adequate protection as to its cash collateral interest. However, the Debtor will pay the rent to Adamo and Development in an amount equal to the monthly principal and interest payments owed to Bay Cities as a pass-through mortgage payment once authorized by the Court. The Debtor is allegedly indebted to E-Z Pack Holdings, LLC, in the amount of $15,936.27. The Debtor asserts that it has paid off its obligations owed to E-Z Pack and disputes any amounts claimed by E-Z Pack. To the extent that E-Z Pack has a lien on cash collateral, that lien is junior and inferior to People's United and Bay Cities and is wholly undersecured. Therefore, no adequate protection of E-Z Pack's alleged interest in the Debtor's cash collateral is required. Furthermore, 1st Source Bank; Galbreath, LLC; Nu-Life Environmental, Inc.; and General Electric Capital Corporation executed security interests in the Debtor's collateral by filing UCCI Financing Statement asserting liens on the Debtor's assets. To the extent that the secured creditors have a lien on cash collateral, their liens are junior and inferior to People's united and are undersecured. Tampa, Florida-based RDK Truck Sales & Service, Inc., specializes in both the sale and rental of new and reconditioned waste management vehicles. It filed for Chapter 11 bankruptcy protection on February 1, 2011 (Bankr. M.D. Fla. Case No. 11- 01877). Alberto F Gomez, Jr., Esq., at Morse & Gomez, PA, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. REALOGY CORP: Completes Offering of $700MM Sr. Secured Notes ------------------------------------------------------------ Realogy Corporation successfully completed its private offering of $700 million aggregate principal amount of 7.875% Senior Secured Notes due 2019 which was exempt from the registration requirements of the Securities Act of 1933, as amended. The Notes are guaranteed on a senior secured basis by Domus Intermediate Holdings Corp., the Company's parent, and each domestic subsidiary of the Company that is a guarantor under its senior secured credit facility. The Notes are also guaranteed by Domus Holdings Corp., the Company's indirect parent, on an unsecured senior subordinated basis. The Notes are secured by substantially the same collateral as the Company's existing first lien obligations under its senior secured credit facility, but the priority of the collateral liens securing the Notes is (i) junior to the collateral liens securing the Company's first lien obligations under its senior secured credit facility and (ii) senior to the collateral liens securing the Company's second lien obligations under its senior secured credit facility. The Notes have not be registered under the Securities Act or any state securities law and may not be offered or sold in the United States absent registration or an applicable exemption from registration under the Securities Act and applicable state securities laws. The Notes were offered in the United States only to qualified institutional buyers under Rule 144A of the Securities Act and outside the United States under Regulation S of the Securities Act. The Company used the net proceeds from the offering of the Notes, along with cash on hand, to prepay $700 million of its first lien term loans the maturity of which was extended in connection with a previously announced amendment to the Company's senior secured credit facility. The amendment as well as the extensions of the maturity of a significant portion of the Company's first lien term loans, revolving commitments and synthetic letter of credit commitments became effective upon the prepayment. About Realogy Corp. Realogy Corp. -- http://www.realogy.com/-- a global provider of real estate and relocation services with a diversified business model that includes real estate franchising, brokerage, relocation and title services. Realogy's world-renowned brands and business units include Better Homes and Gardens Real Estate, CENTURY 21, Coldwell Banker, Coldwell Banker Commercial, The Corcoran Group, ERA, Sotheby's International Realty, NRT LLC, Cartus and Title Resource Group. Collectively, Realogy's franchise systems have around 15,000 offices and 270,000 sales associates doing business in 92 countries around the world. Headquartered in Parsippany, N.J., Realogy is owned by affiliates of Apollo Management, L.P., a leading private equity and capital markets investor. Realogy fully supports the principles of the Fair Housing Act. The Company's balance sheet at Sept. 30, 2010, showed $2.67 billion in total assets, $9.14 billion in total liabilities, and a stockholders' deficit of $981.0 million. It has 'Caa2' corporate family rating and 'Caa3' probability of default rating, with positive outlook, from Moody's. The rating outlook is positive. Moody's said in January 2011 that the 'Caa2' CFR and 'Caa3' PDR reflects very high leverage, negative free cash flow and uncertainty regarding the timing and strength of a recovery of the residential housing market in the US. Moody's expects Debt to EBITDA of about 14 times for the 2010 calendar year. Despite the recently completed and proposed improvements to the debt maturity profile, the Caa2 CFR continues to reflect Moody's view that current debt levels are unsustainable and that a substantial reduction in debt levels will be required to stabilize the capital structure. As reported in the February 8, 2011 edition of TCR, Standard & Poor's Ratings Services raised its corporate credit rating on Realogy Corp. to 'CCC' from 'CC'. S&P removed the rating from CreditWatch, where it was placed with positive implications Jan. 18, 2011. The rating outlook is positive. In addition, S&P revised its recovery rating on the company's non- extended senior secured credit facilities to '1', indicating its expectation of very high (90% to 100%) recovery for lenders in the event of a payment default. S&P raised its issue-level rating on this debt to 'B-' -- two notches higher than the 'CCC' corporate credit rating -- in accordance with its notching criteria for a recovery rating of '1'. RIVER EAST: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: River East Plaza, LLC 505 E. Illinois Street, Suite 100 Chicago, IL 60611 Bankruptcy Case No.: 11-05141 Chapter 11 Petition Date: February 10, 2011 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: Bruce W. Black Debtor's Counsel: Michael E. Gosman, Esq. WHYTE HIRSCHBOECK DUDEK S.C. 555 East Wells Street Milwaukee, WI 53202 Tel: (414) 978-5350 E-mail: mgosman@whdlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Daniel E. McLean, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ ABM Janitorial Midwest Janitorial & $578,469 75 Remittance Drive, #3011 Maintenance Services Chicago, IL 60675-3011 Maron Electric Co. Construction $403,568 5401 W. Fargo Avenue Services Skokie, IL 60077 ALCA Carpentry Construction $262,546 161 Tower Drive, Unit F Services Willowbrook, IL 60527 Schiff Hardin LLP Legal Services $247,264 Brookwood Builders Construction $224,466 Services G&M Electrical Contractors Co. Construction $215,626 Services Levy Security Corp. Security Services $212,551 National Heat & Power Corp. Construction $176,683 Services Pio Woodworking Construction $137,850 Services State Mechanical Services Construction $135,404 Services Bruno Francis Plumbing & Heating Construction $132,875 Co Services American Designs, Inc. Construction $111,736 Services Thornton Tomasetti Construction $110,511 Services Koeckritz International Construction $101,514 Services Peerless Rug Co. Construction $97,466 Services Romano's Tile Co. Construction $93,633 Services Goodman Plumbing Construction $91,218 Services DeCicco Painting and Drywall Inc. Construction $89,540 Services Monarch Electric Construction Co. Construction $88,506 Services Waukegan Gurnee Glass Construction $79,348 Services ROSELAND VILLAGE: Files List of Five Largest Unsecured Creditors ---------------------------------------------------------------- Roseland Village LLC filed a list of five largest unsecured creditors with the U.S. Bankruptcy Court for the Eastern District of Virginia. Creditor Nature of Claim Amount -------- --------------- ------ Chesterfield County Treasurer Real estate taxes $220,065 P.O. Box 26585 Richmond, VA 23285 Poole & Poole Architecture Design services $80,602 3736 Winterfield Road Suite 100 Midlothian, VA 23113 Urban Design Associates Design services $30,296 707 Grant Street Pittsburgh, PA 15219 FloranceGordonBrown, PC Legal Services $9,244 1900 One James Center 901 East Cary Street Richmond, VA 23219 Fidelity Title Services, Inc. Title policy updates 265 One James Center, Suite 1949 901 East Cary Street Richmond, VA 23219 Midlothian, Virginia-based Roseland Village, LLC, filed for Chapter 11 bankruptcy protection on January 13, 2011 (Bankr. E.D. Va. Case No. 11-30223). Bruce E. Arkema, Esq., at Durrettebradshaw, PLC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million. ROSELAND VILLAGE: Files Schedules of Assets and Liabilities ----------------------------------------------------------- Roseland Village LLC filed with the U.S. Bankruptcy Court for the Eastern District of Virginia its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------------ ----------- A. Real Property B. Personal Property $42,950,000 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $36,739,008 E. Creditors Holding Unsecured Priority Claims $226,065 F. Creditors Holding Unsecured Non-priority Claims $1,243,068 ------------ ------------ TOTAL $42,950,000 $38,208,142 A full-text copy of the Schedules of Assets and Liabilities is available for free at http://ResearchArchives.com/t/s?731e Midlothian, Virginia-based Roseland Village, LLC, filed for Chapter 11 bankruptcy protection on January 13, 2011 (Bankr. E.D. Va. Case No. 11-30223). Bruce E. Arkema, Esq., at Durrettebradshaw, PLC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million. SCI REAL ESTATE: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: SCI Real Estate Investments, LLC 11620 Wilshire Boulevard, 10th Floor Los Angeles, CA 90025 Bankruptcy Case No.: 11-15975 Chapter 11 Petition Date: February 11, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Peter Carroll Debtor's Counsel: Jeffrey W. Dulberg, Esq. PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Boulevard, Suite 1100 Los Angeles, CA 90067 Tel: (310) 277-6910 E-mail: jdulberg@pszjlaw.com Estimated Assets: $50,000,001 to $100,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Marc Paul, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wachovia Bank Line of Credit/ $25,891,281 333 S. Grand Avenue, 9th Floor ITCN Loan Los Angeles, CA 90071 First Citizenz Bank Loan/Line of $20,003,889 515 S. Flower Street, Suite 1200 Credit Los Angeles, CA 90071 Tenet Healthcare Corporation Outstanding Rent $467,378 P.O. Box 845610 (Promissory Note) Dallas, TX 75284 City of LA Business Tax $232,352 Assessment Mary Greco, Trustee Placement Agreements $135,000 Edward F. Bartz, Jr., IRA Unsecured Note $50,000 Donna L. Bowman & Robert S. Henion Unsecured Note $50,000 The Perry Family Trust Placement Agreement $40,000 Jack E. McCroskey, IRA Unsecured Note $39,200 Be Glad LLC Unsecured Note $30,000 William R. Cosgriff Unsecured Note $27,000 James H. Ernst Unsecured Note $26,882 Frances J. McDaniel, IRA Unsecured Note $25,000 Brent Doyle, IRA Unsecured Note $25,000 Neal Handel, Cal Nat'l Bank Placement Agreement $25,000 Holland & Knight, LLP Legal Fees $22,673 Edward & Judith Berry - Trust Settlement Agreement $12,000 ING 401(K) Distribution $4,436 Incisive Media Advertising $3,000 Internal Revenue Service Penalty re 1099s $2,400 SECURED CALIFORNIA: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Secured California Investments, Inc. 11620 Wilshire Boulevard, 10th Floor Los Angeles, CA 90025 Bankruptcy Case No.: 11-15987 Chapter 11 Petition Date: February 11, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Barry Russell Debtor's Counsel: Jeffrey W. Dulberg, Esq. PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Boulevard, Suite 1100 Los Angeles, CA 90067 Tel: (310) 277-6910 E-mail: jdulberg@pszjlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Marc Paul, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ First Citizens Bank Loan/Line of $20,003,889 515 S. Flower Street, Suite 1200 Credit Los Angeles, CA 90071 Wachovia Bank Line of Credit $3,736,583 333 S. Grand Avenue, 9th Floor Los Angeles, CA 90071 Martin Schiff Note Payable $842,325 TTEE, Schiff Family Trust 1220 Corsica Drive Pacific Palisades, CA 90272 Irvin Q. & Marilyn Sobel, TTEE Note Payable $330,000 10490 Wilshire Boulevard, #1404 Los Angeles, CA 90024 Richard and Pauline R. Schneider Note Payable $272,250 905 Buena Vista Street So. Pasadena, CA 91030 Fidelity International, Inc. Note Payable $165,000 Bruce Hensel, MD Note Payable $123,750 Denise Simon Note Payable $90,750 Robert and Linda Hart Note Payable $82,500 Neal Handel, TTEE Note Payable $82,500 Philip L. Grauman Note Payable $82,500 Klaus Friederic Note Payable $82,500 Barry & Gabriella Brock, TTEE Note Payable $82,500 Harold J. Stanton, TTEE Note Payable $82,500 Howard & Marsha Spike, TTEE Note Payable $82,500 The R&J Family Limited Note Payable $61,875 Partnership Howard and Denise Simon Note Payable $57,750 Punam Patel or Vidya Patel, TTEE Note Payable $41,250 Lawrence M. & Sunnie L. Daniels Note Payable $41,250 Modris A. and Jann E. Tidemanis Note Payable $41,250 SEA LAUNCH: Boeing Still Pursuing $356 Million Claim ---------------------------------------------------- Peter B. de Selding at Space News reports that Boeing has not abandoned its effort to collect $356 million from its former Sea Launch commercial launch service partners in Russia and Ukraine despite an initial setback at a Swedish arbitration panel, saying the companies in question "have the wherewithal to pay." According to the report, how likely it is that Boeing will be able to recover these funds is not known, but the company is pursuing its case at the Stockholm Chamber of Commerce despite that body's previous refusal to rule on the case, saying it lacked jurisdiction. Boeing said in a February 9 filing with the U.S. Securities and Exchange Commission that the Swedish panel spent a year examining Boeing's request for arbitration before deciding, in October 2010, that it had no standing to make a ruling. Boeing said it filed an appeal Jan. 11. Boeing said $147 million of the total relates to a bank guarantee that Boeing made to Sea Launch on behalf of all shareholders. The Norwegian shareholders have reimbursed Boeing for their pro rata share, but to date the Russian and Ukrainian shareholders have contested Boeing's claims. About Sea Launch Sea Launch Company, L.L.C., is a satellite-launch services provider that offers commercial space launch capabilities from the Baikonur Space Center in Kazakhstan. Its owners include Boeing Co., RSC Energia, and Aker ASA. Sea Launch filed for Chapter 11 on June 22, 2009 (Bankr. D. Del. Case No. 09-12153). Joel A. Waite, Esq., and Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor LLP, in Wilmington, Delaware, serve as the Debtor's counsel. At the time of the filing, the Company said its assets range from US$100 million to US$500 million and debts are at least US$1 billion. SEAHAWK DRILLING: Files for Chapter 11 for Quick Sale to Hercules ----------------------------------------------------------------- Seahawk Drilling Inc. and its affiliates sought chapter 11 protection (Bankr. S.D. Texas Lead Case No. 11-20089) to sell its assets to Hercules Offshore, Inc., for $105 million in cash and shares. Seahawk said a Chapter 11 filing is warranted to protect and preserve their going concern value and to facilitate a prompt sale of substantially all of their assets for the benefit of all stakeholders. The Debtors have postpetition financing in the aggregate amount of up to $35,000,000 from D.E. Shaw Direct Capital Portfolios, L.L.C. Based on court filings, the Debtors do not intend to conduct any bankruptcy auction or further market test the assets while under Chapter 11. In the opinion of Simmons And Company International and the board of directors, further marketing efforts would not likely result in any offers superior to the Hercules Asset Purchase Agreement. The fist day hearing is scheduled today February 14, 2011, at 3:30 p.m. CST. Seahawk expects no impact on operations and Seahawk will continue to perform work for its customers without interruption. Seahawk expects that full payment of all funded debt and trade payables will be made. Additionally, Seahawk expects to pay all vendors for goods and services provided after the filing. Parties' Statement Seahawk's Chief Executive Officer, Randy Stilley, stated, "After a thorough and disciplined process, an independent committee of Seahawk's directors and its full Board of Directors determined that an asset sale to Hercules provides the highest level of value to Seahawk's stakeholders." Mr. Stilley continued, "The transaction with Hercules creates a company with a larger, more diverse fleet, broader customer relationships and greater operational flexibility. In addition to increased economies of scale, combining the fleets will provide for substantial cost savings through the elimination of overhead and duplicative public company expenses." Both companies expect to obtain regulatory clearance under the Hart-Scott-Rodino Antitrust Act and close the transaction in the second quarter of 2011. "The filing permits us to effectuate the sale in an efficient manner, allowing us to address legacy liabilities inherited from Pride International, Inc. as part of the August 2009 spin-off, and ensure we continue to operate our business as usual as we proceed with the sale process," Mr. Stilley said. John T. Rynd, President and Chief Executive Officer of Hercules Offshore, Inc., stated, "We believe that the strategic rationale and value proposition of this transaction are very compelling for our shareholders. This is a unique opportunity to acquire assets at an attractive price, and we expect significant synergies once they are added to our rig fleet. Furthermore, the structure and terms by which we are acquiring these assets will provide benefits to our shareholders, allowing us to fully dedicate our time to operate these assets to their maximum potential. We will have the ability to operate a significantly larger fleet of rigs for our customers, with a small amount of incremental cost." The Board of Directors of Hercules Offshore has approved the transaction. Closing of the transaction is subject to bankruptcy court approval, Hercules Offshore lender approval, as well as regulatory approvals and other customary conditions. Assuming such conditions are achieved, Hercules anticipates closing of this transaction to occur during the second quarter of 2011. Jefferies & Company provided a fairness opinion to the Hercules Offshore Board of Directors, and Andrews Kurth LLP and Thompson & Knight LLP acted as legal advisors to Hercules Offshore for this transaction. Hercules Offshore is scheduled to conduct a conference call on today, Feb. 14, 2011, at 7:00 a.m. CST (8:00 a.m. EST) to discuss the transaction. To participate in the conference call by telephone, please call 10 minutes prior to the scheduled start time, one of the following telephone numbers: 866-271-0675 (Domestic) 617-213-8892 (International) The access or confirmation code is 73179107. Road to Chapter 11 Randall D. Stilley, president, chief executive officer and a member of the board of directors of Seahawk Drilling, relates that since mid-2008, the demand for drilling services has declined dramatically, principally as a result of the global financial crisis, declining prices of crude oil and natural gas and deteriorating worldwide economic conditions. The decline in the United States jackup rig market since 2009 has been one of the sharpest downturns for domestic jackup rig activity over the past 30 years. In addition, the regulatory and financial uncertainties regarding a former customer, PEMEX, have had a significant effect on Seahawk's business. Finally, from August 2009 to March 2010, the Debtors' active rig count averaged five to seven working rigs at any given time. On April 20, 2010, the demand for offshore drilling services in the Gulf of Mexico was further negatively impacted by the Macondo well blowout, prompting, among other things, the United States Government to issue a moratorium on all U.S. offshore drilling. According to Mr. Stilley, notwithstanding the termination of the Government-imposed drilling prohibitions later in 2010, the Debtors' customers are experiencing significant delays in the issuance of drilling permits and very few new drilling permits have been issued. In addition, there is an increasingly uncertain regulatory and cost environment which continues to adversely affect the Debtors' business. As a result of all of these factors, the Debtors' active rig count declined to three working rigs during October 2010. While there has been some recent marginal improvement in market conditions -- seven rigs are currently working -- the combined impact of all of these events, together with negative cash flows throughout 2009 and 2010, has severely stressed and exhausted the Debtors' liquidity and even the current operating level results continue to produce negative cash flows for the Debtors, Mr. Stilley relates. Capital Structure As of November 9, 2010, Seahawk reported a loss of $32.1 million from continuing operations, or $2.69 per diluted share, for the three months ended September 30, 2010, compared to a loss of $32.4 million, or $2.80 per diluted share, for the three months ended September 30, 2009. Revenues totaled $18.6 million during the three months ended September 30, 2010, compared with $67.6 million during the three months ended September 30, 2009. Seahawk's consolidated balance sheet at September 30, 2010, included cash and cash equivalents of $41.4 million and net working capital of $11.4 million. Capital expenditures during the third quarter of 2010 were $4.5 million. On September 30, 2010, Seahawk had total assets of $504.9 million, stockholders' equity of $380.4 million, and short-term debt of $17.9 million. Sale to Hercules In February 2011, after evaluating the indications of interest and potential offers received from a number of interested parties, the Board authorized the Debtors to enter into an Asset Purchase Agreement with Hercules Offshore Inc. The executed APA contemplates the acquisition by Hercules or one or more of its subsidiaries of substantially all of the assets and jackup rigs of the Debtors through a sale pursuant to Section 363 of the Bankruptcy Code. The aggregate consideration for the Purchased Assets is (a) 22,321,425 shares of Hercules Common Stock plus (b) cash in an amount equal to $25,000,012, subject to certain adjustments. Using the closing stock price of Hercules' stock as of February 10, 2011, the Base Aggregate Consideration would be valued at approximately $105 million before any adjustments. The Base Aggregate Consideration is to be payable at closing by Purchaser to Sellers. The Debtors propose to sell these assets to Hercules: a. Rigs. Substantially all of the Debtors' 20 jackup Rigs; b. Contracts. All of the interests, rights, Claims, and benefits arising or accruing to any of Sellers under any Contract to the extent Sellers' interest in such Contract is transferable; c. Equipment. All furniture, equipment, computers, computer equipment, machinery, tools, hand tools, spare parts, test equipment, supplies, inventory, office supplies, telephones, and all other tangible personal property relating to the operation of the Business. d. Rolling Stock. All automobiles, vans, trucks, trailers, and other motorized and similar vehicles and stock of every kind, whether owned or leased, used in the operation of the Business; e. Additional Tangible Assets. All other Tangible Personal Property of every kind used in the operation of the Business; f. Accounts and Notes Receivable. All trade accounts receivable, notes receivable, and other rights of Sellers to payment from customers and other third parties; g. Insurance Benefits. All insurance benefits arising from or related to the Business; h. Cash. All cash and cash equivalents, securities, money on deposit with banks, certificates of deposit, and similar short-term investments of Sellers; i. Prepaid Deposits and Expenses. Any deposits and prepaid expenses (paid to or by Sellers), Claims for refunds, and rights of set off related to the Purchased Assets or Business; j. Claims. Any and all Claims against third parties relating or attributable to the Business; k. Permits. Any and all Permits, including pending applications or filings therefor and renewals thereof, of every kind; l. Books and Records. Photocopies of all of the Books and Records; m. Warranties. All Claims, warranties, reimbursements, indemnities, and causes of action with respect to (i) the Purchased Assets, (ii) the Business and (iii) the Assumed Liabilities; n. Other Assets. All other tangible or intangible assets, rights, privileges, benefits, Claims, and interests of a Seller, whether real, personal or mixed, of every kind and description and wherever located, that relate to, used in or held for use in the operation of the Business. Excluded assets in the sale include (a) any and all Claims or rights of the Debtors arising under chapter 5 of the Bankruptcy Code; and (b) any and all claims or rights of the Debtors against former parent Pride International Inc. An expedited sale of the Debtors' assets is a mandatory condition of the APA. Hercules can terminate the APA if (i) a final order approving the sale is not entered by the Bankruptcy Court by 120 days after the Petition Date; and (ii) the DIP Financing is not approved within 21 days of the Petition Date. About Hercules Headquartered in Houston, Hercules Offshore, Inc. operates a fleet of 30 jackup rigs, 17 barge rigs, 65 liftboats, three submersible rigs, one platform rig and a fleet of marine support vessels. The Company offers a range of services to oil and gas producers to meet their needs during drilling, well service, platform inspection, maintenance, and decommissioning operations in several key shallow water provinces around the world. Additional information may be found at http://www.herculesoffshore.com/ About Seahawk Seahawk Drilling, Inc. is an offshore drilling company headquartered in Houston, Texas. Seahawk owns a fleet of 20 jackup rigs that provide shallow water services in the Gulf of Mexico. Seahawk's shares are traded on the NASDAQ Stock Market under the symbol "HAWK." Additional information may be found at http://www.seahawkdrilling.com/ SEAHAWK DRILLING: Case Summary & 30 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Seahawk Drilling, Inc. 5 Greenway Plaza Suite 2700 Houston, TX 77046 Bankruptcy Case No.: 11-20089 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Seahawk Drilling LLC 11-20088 Seahawk Drilling, Inc. 11-20089 Seahawk Mexico Holdings LLC 11-20090 Seahawk Drilling Management LLC 11-20091 Seahawk Offshore Management LLC 11-20092 Energy Supply International LLC 11-20093 Seahawk Global Holdings LLC 11-20094 Seahawk Drilling USA LLC 11-20095 Type of Business: Seahawk Drilling, Inc., engages in a jackup rig business in the United States, Gulf of Mexico, and offshore Mexico. The Company offers rigs and drilling crews on a day rate contractual basis. Chapter 11 Petition Date: February 11, 2011 Bankruptcy Court: U.S. Bankruptcy Court Southern District of Texas (Corpus Christi) Bankruptcy Judge: Richard S. Schmidt Debtors' Bankruptcy Counsel : Berry D Spears, Esq. FULLBRIGHT JAWORKSKI L.L.P. 600 Congress Ave. Ste 2400 Austin, TX 78701 Tel: (512) 536-5246 Fax: (512) 536-4598 E-mail: bspears@fulbright.com Johnathan Christiaan Bolton, Esq. FULBRIGHT & JAWORSKI L.L.P. Fulbright Tower 1301 McKinney Street Suite 5100 Houston, TX 77010-3095 Tel: (713) 651-5113 Fax: (713) 651-5246 E-mail: jbolton@fulbright.com Debtors' Co-counsel: JORDAN, HYDEN, WOMBLE, CULBRETH & HOLZER, P.C. Debtors' Restructuring Advisors: ALVAREZ AND MARSAL NORTH AMERICA, LLC Debtors' Transaction Advisors: SIMMONS AND COMPANY INTERNATIONAL Debtors' Claims Agent: KURTZMAN CARSON CONSULTANTS LLC Total Assets: $504,897,000 Total Debts: $124,474,000 The petition was signed by Randall D. Stilley, president and chief executive officer. Debtor's List of 30 Largest Unsecured Creditors: Entity/Person Nature of Claim Claim Amount ------------- --------------- ------------ Pride International, Inc. Trade Payable- $15,621,390 5847 San Felipe Street Subject to setoff Ste 3300 Houston, TX 77057 McGriff Seibels and Williams Trade Payable $3,520,032 of TX 818 Town and Country Lane Ste 500 Houston, TX 77024 Offshore Towing, Inc. Trade Payable $1,909,721 11812 Hwy 308 Larose, LA 70373 Beacon Maritime, Inc. Trade Payable $342,840 96 Front Ave. Orange, TX 77630 L&L Oil and Gas Services, LLC Trade Payable $296,294 3421 North Causeway Blvd. Suite 502 Metairie, LA 70002 C and G Boats, Inc. Trade Payable $196,733 MAD Ltd. Trade Payable $139,712 Bennett & Associates LLC Trade Payable $106,142 KMPG LLP Trade Payable $100,000 The Nacher Corporation Trade Payable $96,171 UHY Advisors TX, LLC Trade Payable $79,416 Galloway, Johnson, Tompkins, Trade Payable $72,772 Burr & Smith Bletsch Steamship Company Trade Payable $72,260 G&J Land and Marine Food Trade Payable $70,212 Dist. Inc. ACME Truck Line, Inc. Trade Payable $67,493 Rotorcraft Leasing Company LLC Trade Payable $64,886 Neptune Underwater Services LLC Trade Payable $64,279 Keane Inc. Trade Payable $52,135 Specialties Company Trade Payable $51,983 Polar Rig Specialties, Inc. Trade Payable $43,313 Transcontinental Gas Pipe Trade Payable $40,927 Co LLC G. Roper, Inc. Trade Payable $39,805 dba Creative Ideas, Inc. Superior Supply & Steel Trade Payable $38,673 PPG Architectural Finishes Trade Payable $36,563 Protection Sher Garner LLC Trade Payable $36,425 Power Products Service Trade Payable $36,223 Company, Inc. Konica Minolta Business Trade Payable $33,237 Solutions, Inc. Martin Holdings LLC Trade Payable $32,774 Sirius Solutions LLLP Trade Payable $31,737 Dooley Tackaberry, Inc. Trade Payable $28,438 S.H. LEGGITT: Confirmation Objections Due by March 11, 2011 ----------------------------------------------------------- S.H. Leggitt Company has proposed a chapter 11 plan of reorganization and the U.S. Bankruptcy Court has approved the company's disclosure statement explaining that plan. The plan proposes to insulate the reorganized company from all future product liability claims arising out of the use of products manufactured by the debtor and used in the manufacture of consumer LP-Gasgrills, cookers and other outdoor LP-Gas cooking appliances. The Debtor supplied LP-Gas regulators to the majority of the companies who made such appliances in North America between 1990 and 2005. The Debtor has also supplied gas regulators to the majority of companies that manufacture recreational vehicles in North America. To obtain copies of the Debtor's plan and disclosure statement, contact Birdie White at white@mvwmlaw.com by e-mail. Objections, if any, to the Plan must be filed and served by March 11, 2011. Objections must also be served on Homan, Taube & Summers, which serves as counsel to the Creditors' Committee. San Marcos, Texas-based S.H. Leggitt Company, aka Marshall Products -- dba The Leggitt Group; Marshall Brass Company; and Marshall Gas Controls, Inc. -- sought Chapter 11 bankruptcy protection (Bankr. W.D. Texas Case No. 10-10279) on Feb. 2, 2010. The Company estimated its assets at less than $10 million and its debts at $10 million to $50 million. Joseph D. Martinec, Esq., and Rebecca S. McElroy, Esq., Ed Winn, Esq., and Lee Vickers, Esq., at Martinec, Winn, Vickers & McElroy, P.C., represent the company. SHALAN ENTERPRISES: Hearing on Perry Klein's Plan Moved to March 9 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Central District of California has continued the confirmation hearing on Perry and Rita Klein's plan of reorganization for Shalan Enterprises, LLC, to March 9, 2011, at 9:30 a.m. As reported in the Troubled Company Reporter on January 11, 2011, creditors Perry and Rita Klein filed a plan of reorganization and disclosure statement for Shalan Enterprises, LLC, with the Bankruptcy Court. The Plan calls for the appointment of a Plan Administrator. The Plan proposes a three-year liquidation process of the nonexempt property and requires Alan Rapoport, the manager of the Debtor, to devote all his disposable income to the plan for five years. The Allowed Secured Claims will be paid as their collateral is liquidated with excess proceeds being used to pay other Classes. If not sooner, the Allowed Unsecured Claims will start receiving disbursements three years from Confirmation Date. About Shalan Enterprises Marina Del Rey, California-based Shalan Enterprises, LLC, a Nevada limited liability company, was formed in 1999 for the purpose of owning, operating and leasing and/or selling properties. The Company filed for Chapter 11 bankruptcy protection on November 25, 2009 (Bankr. C.D. Calif. Case No. 09-43263). The Company has assets of $12,540,000, and total debts of $7,426,313. The Debtor's case is substantively consolidated with Alan Rapoport, the manager of the Debtor. Mr. Rapoport filed for Chapter 11 on November 30, 2009 (Bankr. C.D. Calif. Case No. 09-43499). SHELBRAN INVESTMENTS: U.S. Trustee Unable to Form Creditor's Panel ------------------------------------------------------------------ The U.S. Trustee for Region 21 told the U.S. Bankruptcy Court for the Middle District of Florida that it will not appoint an Official Committee of Unsecured Creditors of Shelbran Investments LP because of an insufficient number of creditors willing or able to serve on an the committee. Ocala, Florida-based Shelbran Investments, L. P., filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 10- 10937) on December 21, 2010. The Debtor estimated its assets and debts at $10 million to $50 million. SILVERVIEW, LLC: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Silverview, LLC 1371 Hancock Road, Suite 1 Bullhead City, AZ 86442 Bankruptcy Case No.: 11-03325 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court District of Arizona (Yuma) Judge: Randolph J. Haines Debtor's Counsel: Patrick A. Clisham, Esq. ENGELMAN BERGER PC 3636 N. Central Avenue, #700 Phoenix, AZ 85012 Tel: (602) 271-9090 Fax: (602) 222-4999 E-mail: pac@engelmanberger.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 Robert C. Lewis, manager. SONOMA VINEYARD: Geneva Leasing Has Lift Stay to Foreclose ---------------------------------------------------------- No opposition having been made and for good reason, the U.S. Bankruptcy Court for the Northern District of California entered, on January 14, 2011, its order granting Geneva Leasing Associates, Inc.'s motion for relief of stay. The automatic stay pursuant to 11 U.S.C. Section 362 is terminated to allow Geneva Leasing Associates, Inc., to resume the previously scheduled foreclosure sale with respect to the real property located at 4800 & 5750 Stage Gulch Road, in Sonoma, Calif., in accordance with the terms of the Deed of Trust dated December 21, 2006, and state law. About Sonoma Vineyard Estates Napa, California-based Sonoma Vineyard Estates LLC filed for Chapter 11 bankruptcy protection on September 7, 2010 (Bankr. N.D. Calif. Case No. 10-13447). Michael C. Fallon, Esq., at the Law Offices of Michael C. Fallon, in Santa Rosa, Calif., assists the Debtor in its restructuring effort. In its schedules, the Debtor listed $10,000,038 in assets and $6,998,010 in liabilities. STANT PARENT: Chapter 11 Plan Declared Effective December 31 ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware confirmed on December 9, 2010, the First Amended Joint Chapter 11 Plan of Reorganization proposed by SPC Seller, Inc., et al., and the Official Committee of Unsecured Creditors. SPC Seller, Inc. (f/k/a Stant Parent Corp.) and its related debtor entities give notice that the Effective Date of the Plan occurred on December 31, 2010. As reported in the Troubled Company Reporter on November 22, 2010, the Bankruptcy Court will convene a hearing on December 1, 2010, at 10:00 a.m. (prevailing Eastern Time), to consider the confirmation of Stant Parent Corp., nka SPC Seller, Inc., et al.'s Plan of Reorganization. As reported in the Troubled Company Reporter on June 14, according to the Disclosure Statement proposed by the Debtors and the Official Committee of Unsecured Creditors, the Plan provides for the purchaser to assume the DIP facility claims and senior secured lenders claims, which are deemed paid in full pursuant to the terms of the APA and sale order. By consent, the holders of junior prepetition note claims will receive the Northstar consideration (a) $100,000; and (b) warrants for $1.75% of the fully diluted common equity of the purchaser. Holders General unsecured claims have an estimated percentage recovery of 2.51% to 3.01%. The Plan cancels all interests in the Debtors. Holders of interests will receive no distribution under the Plan. About Stant Parent Stant Parent Corp., et al., filed for Chapter 11 bankruptcy protection on July 27, 2009 (Bankr. D. Del. Lead Case No. 09-12647). Alan J. Brody, Esq., at Greenberg Traurig, LLP, in Florham Park, N.J., represents the Debtors as counsel. In its petition, Stant Parent Corp. estimated assets of between $50 million and $100 million and debts of between $50 million and $100 million. Prior to the sale of their assets to Vapor Acquisition Corp., which closed on October 27, 2009, the Debtors comprised the U.S. operating and holding entities of the Stant conglomerate, which is a leading integrated manufacturer of highly engineered fluid systems for the global automotive and industrial original equipment manufacturing ("OEM") markets and the automotive market. SUMMIT BUSINESS: Section 341(a) Meeting Set for March 9 ------------------------------------------------------- Roberta A. DeAngelis, the U.S. Trustee for Region 3, will convene a meeting of creditors of Summit Business Media Holding Company on March 9, 2011, at 10:00 a.m., J. Caleb Boggs Federal Building, Fifth Floor, Room 2112, in Wilmington, Delaware. 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. New York-based Summit Business Media Holding Company -- http://www.summitbusinessmedia.com/-- is a business-to-business publisher and event organizer serving the insurance, investment advisory, professional services and mining investment markets. Summit employs nearly 400 employees in ten offices across the United States. The Company was formed through seven acquisitions since 2006. Summit Business is a Delaware corporation that wholly owns Summit Business Media Intermediate Holding Company, LLC, a Delaware limited liability company. Summit Intermediate wholly owns The National Underwriter Company, an Ohio corporation, which in turn wholly owns six distinct subsidiary companies which comprise the remaining Debtors. Summit Business Media Holding Company and eight affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10231) on Jan. 25, 2011. Kimberly E. C. Lawson, Esq., and Kathleen Murphy, Esq. at Reed Smith LLP, in Wilmington, Delaware; and J. Andrew Rahl, Jr., Esq., at Reed Smith LLP, in New York, serve as counsel to the Debtors. Lincoln Partners Advisors LLC is the financial advisor. Garden City Group is the claims and notice agent. Summit estimated assets and debts of $100 million to $500 million in its Chapter 11 petition. SUMMIT BUSINESS: Taps Garden City as Claims Agent ------------------------------------------------- Summit Business Media Holding Company and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ The Garden City Group Inc as claims, noticing, and balloting agent. The firm will: i) prepare and serve some or all notices required in these cases; ii) maintain copies of all proofs of claim and proofs of interest filed in these cases; iii) maintain the official claims register; iv) maintain an up-to-date mailing list for all entities who have filed proofs of claim and requests for notices in these cases; v) assist the Debtors with the reconciliation and resolution of claims; and vi) mail and tabulate ballots for purposes of plan voting in these cases. The Debtor paid the firm a $40,000 retainer. The firm will be paid based on the hourly rates of its professionals: Designations Hourly Rates ------------ ------------ Administrative & Data Entry $45-$55 Mailroom and Claims Control $55 Customer Service Representatives $57 Proejct Administrators $70-$85 Quality Assurance Staff $80-$125 Project Supervisors $195-$l10 Systems & Technology Siaff $100-$200 Graphic Support for Web Site $125 Project Managers $125-$175 Directors, Sr. Consultants and Asst VP $200-$295 Vice President and above $295 The Debtors assure the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. New York-based Summit Business Media Holding Company -- http://www.summitbusinessmedia.com/-- is a business-to-business publisher and event organizer serving the insurance, investment advisory, professional services and mining investment markets. Summit employs nearly 400 employees in ten offices across the United States. The Company was formed through seven acquisitions since 2006. Summit Business is a Delaware corporation that wholly owns Summit Business Media Intermediate Holding Company, LLC, a Delaware limited liability company. Summit Intermediate wholly owns The National Underwriter Company, an Ohio corporation, which in turn wholly owns six distinct subsidiary companies which comprise the remaining Debtors. Summit Business Media Holding Company and eight affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10231) on Jan. 25, 2011. Kimberly E. C. Lawson, Esq., and Kathleen Murphy, Esq. at Reed Smith LLP, in Wilmington, Delaware; and J. Andrew Rahl, Jr., Esq., at Reed Smith LLP, in New York, serve as counsel to the Debtors. Lincoln Partners Advisors LLC is the financial advisor. Garden City Group is the claims and notice agent. Summit estimated assets and debts of $100 million to $500 million in its Chapter 11 petition. SUMMIT BUSINESS: U.S. Trustee Unable to Form Creditor's Committee ----------------------------------------------------------------- Roberta A. DeAngelis, the U.S. Trustee for Region 3, told the U.S. Bankruptcy Court for the District of Delaware that she is unable to form an Official Committee of Unsecured Creditors for Summit Business Media Holding Company because there is insufficient response to the United States Trustee communication for service on the committee. New York-based Summit Business Media Holding Company -- http://www.summitbusinessmedia.com/-- is a business-to-business publisher and event organizer serving the insurance, investment advisory, professional services and mining investment markets. Summit employs nearly 400 employees in ten offices across the United States. The Company was formed through seven acquisitions since 2006. Summit Business is a Delaware corporation that wholly owns Summit Business Media Intermediate Holding Company, LLC, a Delaware limited liability company. Summit Intermediate wholly owns The National Underwriter Company, an Ohio corporation, which in turn wholly owns six distinct subsidiary companies which comprise the remaining Debtors. Summit Business Media Holding Company and eight affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10231) on Jan. 25, 2011. Kimberly E. C. Lawson, Esq., and Kathleen Murphy, Esq. at Reed Smith LLP, in Wilmington, Delaware; and J. Andrew Rahl, Jr., Esq., at Reed Smith LLP, in New York, serve as counsel to the Debtors. Lincoln Partners Advisors LLC is the financial advisor. Garden City Group is the claims and notice agent. Summit estimated assets and debts of $100 million to $500 million in its Chapter 11 petition. SUNSHINE STATE COMMUNITY: Closed; Premier American Takes Deposits ----------------------------------------------------------------- Sunshine State Community Bank of Port Orange, Fla., was closed on Friday, February 11, 2011, by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Premier American Bank, National Association, of Miami, Fla., to assume all of the deposits of Sunshine State Community Bank. The five branches of Sunshine State Community Bank will reopen during their normal business hours as branches of Premier American Bank. Depositors of Sunshine State Community Bank will automatically become depositors of Premier American Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Sunshine State Community Bank should continue to use their existing branch until they receive notice from Premier American Bank that it has completed systems changes to allow other Premier American Bank branches to process their accounts as well. As of December 31, 2010, Sunshine State Community Bank had around $125.5 million in total assets and $116.7 million in total deposits. Premier American Bank will pay the FDIC a premium of 0.50 percent to assume all of the deposits of Sunshine State Community Bank. In addition to assuming all of the deposits of the failed bank, Premier American Bank agreed to purchase essentially all of the assets. Customers who have questions about the transaction can call the FDIC toll-free at 1-866-308-4470. Interested parties also can visit the FDIC's Web site at: http://www.fdic.gov/bank/individual/failed/sunshinestate.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $30.0 million. Compared to other alternatives, Premier American Bank's acquisition was the least costly resolution for the FDIC's DIF. Sunshine State Community Bank is the fifteenth FDIC-insured institution to fail in the nation this year, and the second in Florida. The last FDIC-insured institution closed in the state was First Commercial Bank of Florida, Orlando, on January 7, 2011. SUNWEST MANAGEMENT: Settles With Merrill Over $2.2 Million Claim ---------------------------------------------------------------- Bankruptcy Law360 reports that the receiver for Sunwest Management Inc. has granted Merrill Lynch Capital Services Inc. a $600,000 claim against the Company, settling a dispute over Merrill's claim for $2.2 million in transaction payments. According to Law360, Judge Michael Hogan of the U.S. District Court for the District of Oregon on Monday approved the receiver's settlement with Merrill that allows a $600,000 claim relating to swap transactions. About Sunwest Management Founded in Oregon in 1991, Sunwest Management -- http://www.sunwestmanagement.com/-- was one of the largest private senior living providers in the U.S. In March 2009, U.S. District Judge Michael Hogan appointed Michael Grassmueck -- founder and principal of Portland, Oregon-based Grassmueck Group, a national firm that specializes in fiduciary and insolvency services -- as receiver for the Company after the Securities and Exchange Commission filed suit against Sunwest and former CEO Jon Harder, alleging securities fraud. Sunwest Management placed 10 assisted living centers -- two in Oregon -- into Chapter 11 bankruptcy. Briarwood Retirement and Assisted Living Community LLC, which owns a retirement center in Springfield, and Century Fields Retirement and Assisted Living Community LLC, which owns a center in Lebanon, filed for Chapter 11 protection on August 19, 2008. On Aug. 17, 2008, eight Sunwest-affiliated LLCs filed for Chapter 11 bankruptcy protection from creditors in Tennessee. Sunwest was later renamed Stayton SW Assisted Living. As reported by the Troubled Company Reporter on July 16, 2010, Judge Hogan confirmed the plan of reorganization in the Chapter 11 proceedings of Stayton. The plan provides for the sale of up to 149 senior living facilities to a joint venture formed by Blackstone Real Estate Advisors VI L.P., Emeritus Senior Living and Columbia Pacific Advisors. The Blackstone/Emeritus joint venture acquired the properties in exchange for cash, securities and debt valued at $1.3 billion in cash. Under the Plan, existing Sunwest investors were permitted to receive either cash or securities in the new company, with a choice between Class A preferred interests paying 6%, or up to 49% in common interests in the joint venture. The reorganization plan also provides for the creation of a Trustco entity to hold certain non-senior living assets, such as apartments, office buildings and bare land, and liquidate the assets over time for the benefit of the estate's investors and creditors. The Receiver oversees Trustco. In August 2010, Stayton completed the sale of 132 senior living facilities to the joint venture. The transaction was valued at $1.2 billion. In December 2010, the federal equity receiver in charge of former Oregon-based senior living provider Sunwest Management announced a 40% initial distribution to investors and other claimants in the Sunwest securities violation case and related Chapter 11 bankruptcy proceeding. Resources for the initial distribution total $228 million and derive from a $1.2 billion real estate transaction closed earlier this year, in which a joint venture led by Blackstone Real Estate Advisors VI LP and Emeritus Senior Living acquired 144 Sunwest properties in exchange for cash, securities and assumption of debt. SYNTERRA 3020: Section 341(A) Meeting Set for February 24 --------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of creditors of Synterra 3020 Market LP on Feb. 24, 2011, at 2:00 p.m., at Office of the U.S. Trustee, Meeting Room, Suite 501, 833 Chestnut Street in Philadelphia, Pennsylvania. 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. Synterra 3020 filed for Chapter 11 bankruptcy protection on January 12, 2011 (Bankr. E.D. Pa. Case No. 11-10205). Albert A. Ciardi, III, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. TALON THERAPEUTICS: James E. Flynn Discloses 38.49% Equity Stake ---------------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission on February 4, 2011, James E. Flynn disclosed that he beneficially owns 10,547,415 shares of common stock of Talon Therapeutics, Inc. representing 38.49% of the shares outstanding. Other affiliates of Mr. Flynn also disclosed beneficial ownership of common stock of the Company: Shares Equity Beneficially Owned Stake ------------------ ------ Deerfield Capital, L.P. 9,019,211 33.73% Deerfield Special Situations Fund, L.P. 843,925 3.91% Deerfield Private Design Fund, L.P. 3,131,145 13.49% Deerfield Private Design International 5,044,141 20.67% Deerfield Management Company, L.P. 1,528,204 6.98% Deerfield Special Situations Fund Int'l 1,528,204 6.98% Pursuant to a letter agreement, dated as of February 2, 2011, by and among Talon Therapeutics, Inc., Warburg Pincus Private Equity X, L.P., Warburg Pincus X Partners, L.P., Deerfield Special Situation Fund, Deerfield Special Situations Fund International, Deerfield Private Design Fund and Deerfield Private Design International, the parties confirmed their understanding that, with respect to the period beginning on June 7, 2010 and ending on September 9, 2010 only, there will not be any accretion on the shares of Series A-1 Preferred Stock issued to the shareholders party thereto on June 7, 2010 pursuant to the Series A-1 Certificate. As of November 12, 2010, there were issued and outstanding 21,234,307 shares of the Company's common stock, $.001 par value. About Talon Therapeutics Formerly known as Hana Biosciences, Inc., Talon Therapeutics Inc. (TLON.OB.) -- http://www.talontx.com/-- is a biopharmaceutical company dedicated to developing and commercializing new, differentiated cancer therapies designed to improve and enable current standards of care. The company's lead product candidate, Marqibo, potentially treats acute lymphoblastic leukemia and lymphomas. The Company has additional pipeline opportunities some of which, like Marqibo, improve delivery and enhance the therapeutic benefits of well characterized, proven chemotherapies and enable high potency dosing without increased toxicity. Effective December 1, 2010, Hana Biosciences Inc. changed its name to Talon Therapeutics Inc. The name change was effected by merging Talon Therapeutics, Inc., a wholly-owned subsidiary of the Company, with and into the Company, with the Company as the surviving corporation in the merger. Hana Biosciences' balance sheet as of June 30, 2010, showed $39.3 million in total assets, $36.6 million in total liabilities, $29.9 million in redeemable convertible preferred stock, and a stockholders' deficit of $27.2 million. As reported in the Troubled Company Reporter on March 29, 2010, BDO Seidman, LLP, in San Francisco, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations and has a net capital deficiency. THINKFILM LLC: Three Other Companies Declared Bankrupt ------------------------------------------------------ Brent Lang at The Wrap News reports that a bankruptcy judge Barry Russell placed the three remaining companies -- R2D2, CT-1 Holdings and Capco -- run by the controversial film financier David Bergstein into bankruptcy, citing a "willful failure to comply." According to the report, there will be no further trial, and the companies' assets will be liquidated to pay off the over 30 creditors currently suing Mr. Bergstein for millions of dollars in unpaid bills. "This is a total vindication for my company and all its investors and the number of small creditors who had the guts to stand up to bullies. It goes to show the system works, and you can't get away with treating people like this. Justice has been served," Mr. Lang quotes Aramid Entertainment Funds' David Molner, one of the major creditors involved in the case, as stating. About Thinkfilm, et al. CapCo Group LLC and four other companies controlled by David Bergstein are part of a wider network of entities that distribute and finance films. Among the approximately 1,300 films they have the rights to are "Boondock Saints" and "The Wedding Planner." Several creditors filed for involuntary Chapter 11 against the companies on March 17, 2010 -- CT-1 Holdings LLC (Bankr. C.D. Calif. Case No. 10-19927); CapCo Group, LLC (Bankr. C.D. Calif. Case No. 10-19929); Capitol Films Development LLC (Bankr. C.D. Calif. Case No. 10-19938); R2D2, LLC (Bankr. C.D. Calif. Case No. 10-19924); and ThinkFilm LLC (Bankr. C.D. Calif. Case No. 10- 19912). Judge Barry Russell presides over the cases. The Petitioners are represented by David L. Neale, Esq., at Levene Neale Bender Rankin & Brill LLP. Federal bankruptcy judge Barry Russell formally declared David Bergstein's ThinkFilm LLC and Capitol Films Development bankrupt on October 5, 2010. Mr. Mr. Bergstein is being sued for tens of millions of dollars by nearly 30 creditors -- including advertisers, publicists and the Writers Guild West. Five Bergstein controlled companies have been named in the suit. TODD M ENRIGHT: Spouse's Lawyer in Divorce Case Can File Claim -------------------------------------------------------------- Bankruptcy Judge Colleen A. Brown rules that (i) the law firm Nelson Mullins Riley and Scarborough, LLP, has standing and may assert a claim against the bankruptcy estate of Todd M. Enright, if it is the ultimate payee of attorneys' fees awarded in a divorce action; and (ii) the Debtor has standing to object to the Nelson Mullins claim to the extent that the claim asserts non- dischargeable status, as the Debtor clearly has a pecuniary interest in whether this claim is allowed. The Debtor argues that Nelson Mullins -- the attorney of his estranged spouse in a pending Georgia divorce proceeding -- lacks standing to file the proof of claim as it has no claim against the Debtor and that there is no privity of contract between the Debtor and Nelson Mullins. Nelson Mullins counters that, since this is a chapter 7 case, the Debtor lacks standing to object to its proof of claim as he has no pecuniary interest at stake. The Chapter 7 Trustee takes the position that the Debtor does have a pecuniary interest in the outcome of the claim objection to the extent the Court determines it to be a non-dischargeable claim. The Chapter 7 Trustee does not object to the Debtor proceeding on his objection to claim so long as the Chapter 7 Trustee's right to object to the Nelson Mullins claim are preserved with respect to any dischargeable portion of the claim, and the adjudication of the Debtor's objection to the Nelson Mullins claim has no estoppel impact on the Chapter 7 Trustee. Judge Brown said the Debtor has failed to sustain his burden of proof in establishing that Nelson Mullins lacks standing to be treated as a creditor with an allowed claim in the case, and has likewise failed to establish that the claim should be disallowed based upon lack of contract privity. Judge Brown said the ruling is without prejudice to the Debtor's and the Chapter 7 Trustee's rights to object to this claim on other grounds. The merits of Nelson Mullins' claim and any further objections to the claim, whether raised by the Debtor or the Chapter 7 Trustee, will be interposed and addressed in an adversary proceeding Nelson Mullins commenced against the Debtor and the Chapter 7 Trustee. Todd M. Enright Debtor filed Chapter 11 bankruptcy (Bankr. D. Vt. Case No. 10-10873) on June 24, 2010. The case was converted to one under Chapter 7 on December 9, 2010. A copy of the Court's February 9, 2011 order is available at http://is.gd/LJami6from Leagle.com. TREVOR DAVIS: Zimco Holdings Condo Sales to Move Forward -------------------------------------------------------- David Jones at The Real Deal reports that Zimco Holdings, a creditor of developer Trevor Davis, urged a federal bankruptcy judge to allow court-supervised sales at 1055 Park Avenue, the luxury condominium building in New York where it holds a $6 million loan. According to the report, the creditor said it want to allow sales to move forward, claiming that a pricing dispute with the building's senior lender at 1055 Park is holding up potential deals. "We'd like the apartment sales to move forward. There's an issue over current release prices. Under the mortgage documents the release prices are probably higher than what the market would bear," The Real Deal quotes Kevin Nash, lawyer for Zimco, as stating. According to the report, Zimco argued that it agreed that Prudential Douglas Elliman, who Davis hired as the third listing broker at the property, would be able to sell units at $1,600 per square foot. This would generate a sell out price of $24.1 million, which Zimco says would be enough to pay off the building's senior debt and other creditors as well. Mr. Jone relates that the senior lenders refused to allow sales to proceed at the lower sales prices, known as a "strike price" or the minimum price set by the lender to protect the commercial loan from going underwater. Based in New York, Trevor P. Davis filed for Chapter 11 bankruptcy protection on Dec. 21, 2011 (Bankr. S.D.N.Y. Case No. 10-16722). Judge Shelley C. Chapman presides the case. Scott S. Markowitz, Esq., at Tarter Krinsky & Drogin LLP, represents the Debtor. The Debtor estimated assets of between $50 million and $100 million, and debts of $10 million and $50 million. TRIBUNE CO: Only Noteholders Didn't Vote for Mgt. Plan ------------------------------------------------------ Tribune Company disclosed that the results of the voting on the two proposed Plans of Reorganization pending before the U.S. Bankruptcy Court for the District of Delaware overseeing its Chapter 11 proceedings have been filed with the court by the court-appointed voting agent. The company's plan, also supported by its co-proponents, the Official Committee of Unsecured Creditors, JPMorgan Chase Bank, N.A., Angelo Gordon & Co., L.P., and Oaktree Capital Management, L.P., was overwhelmingly approved by the holders of the Senior Loan Claims and the Bridge Loan Claims, as well as most classes of trade and other general unsecured claimants. As expected, the company's plan was not approved by the holders of the Senior Noteholder Claims and the PHONES Notes Claims. The plan being sponsored by Aurelius Capital Management, a large holder of Senior Noteholder Claims, and the indenture trustees for the Senior Notes and the PHONES Notes, was rejected by virtually all classes of voting creditors other than the Senior Noteholder Claims and PHONES Notes Claims classes. "These results are as we expected and we are pleased that they confirm broad support for the restructuring plan supported by the Company and its co-proponents," said Don Liebentritt, Tribune's Chief Restructuring Officer. "We continue to prepare for the confirmation hearing set to begin on March 7th and remain confident that the court will confirm our plan over the Aurelius/Noteholder plan." About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Amends Plan to Add King Street Settlement ----------------------------------------------------- Tribune Company and its debtor subsidiaries, the Official Committee of Unsecured Creditors, Oaktree Capital Management, L.P., Angelo, Gordon & Co., L.P., and JPMorgan Chase Bank, N.A., - - the "DCL Plan Proponents" -- submitted with the U.S. Bankruptcy Court for the District of Delaware a second amended joint plan of reorganization on February 4, 2011. In light of the recent settlement between the Debtors and King Street Acquisition Company, LLC, King Street Capital, LLP and Marathon Asset Management, L.P. -- the Bridge Lender Group -- the Second Amended Plan revised the treatment of the classes of claims affecting the Bridge Loan Lenders' Claims. The Second Amended Plan provides that so long as (i) the Bridge Lender Group has withdrawn their proposed plan of reorganization and their related discovery requests issued on or prior to February 8, 2011, and (ii) the Bridge Lender Group has supported the Debtors' Plan, taken no actions inconsistent with confirmation of the Plan in their capacities as Holders of Bridge Loan Claims from and after January 28, 2011, and voted all Bridge Loan Claims held by them to accept the Debtors' Plan: -- Class 1D - Bridge Loan Claims against Tribune Co. will be deemed allowed in an aggregate amount equal to all amounts payable under the Bridge Loan Agreement and the Pledge Agreement; and -- Classes 50D through 111D - Bridge Loan Guaranty Claims will be deemed allowed in an aggregate amount equal to all amounts payable under the Bridge Loan Guaranty Agreement. Each of JP Morgan, Citicorp North America, Inc., and Bank of America, N.A. -- the "Arranger Bridge Lenders" -- will have the option to either: (i) receive their Pro Rata share of the distributions set forth in Section 3.2.4(c) of the Plan on account of Bridge Loan Claims held for their own account and not receive a release of any claims or causes of action from any Non-Arranger Bridge Lender, which claims will be unaffected by the Plan or the Confirmation Order, regardless of whether any Non Arranger Bridge Lender agreed or are deemed to provide the releases set forth in Section 11.2.2 of the Plan; or (ii) forgo their Pro Rata share of the distributions set forth in Section 3.2.4(c) of the Plan on account of Bridge Loan Claims held for their own account, in which case the distributions allocable to that Arranger Bridge Lender will instead be distributed Pro Rata to the Non-Arranger Bridge Lenders, and by accepting the additional distributions each Non-Arranger Bridge Lender and the Bridge Loan Agent will be deemed to have unconditionally and irrevocably released each and all of the Arranger Bridge Lenders that elected the treatment set forth in Section 3.2.4(d)(ii) of and from any and all Holder Released Claims and any other claims or causes of action related to or arising out of the Bridge Loan Agreement, regardless of whether each or any Non-Arranger Bridge Lender agreed to provide the releases set forth in Section 11.2.2. Under the Second Amended Plan, reorganized Tribune will reimburse the Bridge Lender Fee/Expense Claims up to an aggregate amount not exceeding $7,000,000; provided that if three or more of the Arranger Bridge Lenders do not elect the treatment set forth in Section 3.2.4(d)(ii) of the Plan, then reorganized Tribune will provide reimbursement for the Bridge Lender Fee/Expense Claims up to an aggregate amount not exceeding $8,000,000. The Bridge Plan Proponents will provide the Debtors with good faith estimates of their collective Bridge Lender Fee/Expense Claims at least seven days prior to the anticipated effective date. The estimates will be used solely for administrative purposes, will not be binding on the Bridge Plan Proponents, and will not in any way limit, cap or reduce the amount of the Bridge Lender Fee/Expense Claims. The Bridge Loan Settlement provides, among other things, that on the Effective Date of the Plan, the Bridge Lenders will receive their pro rata share of $64.5 million in cash. On the Effective Date, the Bridge Lenders will also receive their pro rata share of the LBO Lenders' share of the Litigation Trust Interest and Creditors' Trust Interests. Treatment of Senior Noteholder Claims Class 1E - Senior Noteholder Claims will be deemed allowed in the aggregate amount of $1,283,055,743 (a) plus the amount, if any, of any other Claims arising under or evidenced by the Senior Notes Indentures and related documents, solely to the extent any Claims are Allowed and (b) less any Senior Noteholder Claims held by Morgan Stanley Capital Services, Inc. Directors & Officers of Reorganized Tribune If any of the directors designated by either Oaktree, Angelo Gordon or JPMorgan resigns or be removed prior to the end of the director's initial term, the party that designated that director will have the sole right to designate a replacement director to serve the remaining term of the vacated seat. In the event a Creditor Proponent and the Debtors reasonably determine, based upon comments received from the Federal Communications Commission that the required approval of the FCC will not be obtained due to the designation rights afford to the Creditor Proponent, the Creditor Proponent will take action as is necessary or appropriate to enable the Debtors and the Creditor Proponents to obtain the FCC approval. That action may include: -- altering or divesting an investment or other interest held by the Creditor Proponent in any entity; -- relinquishing its Designation Rights; or -- making any commitment or explanatory filing to the FCC to permit the FCC approval to be obtained. If the Creditor Proponent fails to take action, it will immediately relinquish its Designation Rights and any prior designation by the Creditor Proponent will be deemed withdrawn, and any designee by the Credit Proponent will be deemed resigned from the Board of Directors. Reporting Requirement under Securities Exchange Act Unless otherwise required by applicable law, the board of directors of reorganized Tribune will determine when after the effective date reorganized Tribune will (a) become a reporting company under Section 12 of the Securities Exchange Act of 1934 and (b) list the New Class A Common Stock for trading on the New York Stock Exchange or the NASDAQ Stock Market. In the event reorganized Tribune fails to list the New Class A Common Stock within 12 months after the effective date, then any one of the Proponents holding at least 5% of the outstanding New Class A Common Stock on a fully-diluted basis at the time may exercise its right to demand registration in accordance with the terms of the registration rights agreement and have the New Class A Common Stock listed on a stock exchange. A full-text copy of the Second Amended Plan is available for free at http://bankrupt.com/misc/tribunefeb4plan.pdf A redlined version of the Second Amended Plan is available for free at http://bankrupt.com/misc/tribunefeb4planredline.pdf The DCL Plan Proponents submitted with the Court on January 31, 2011, these exhibits to the Plan: (a) Intercompany Claims Settlement Agreement (b) New Warrant Agreement (c) Individuals excluded from Released Step Two Stockholder Parties (d) Restructuring Transactions (e) Certificate of Incorporation of Reorganized Tribune (f) By-laws of Reorganized Tribune (g) Terms of New Senior Secured Term Loan (h) Terms of Exit Facility (i) Terms of Trusts' Loan Agreement (j) Rejected Executory Contracts and Unexpired Leases (k) Litigation Trust Agreement (l) Creditors' Trust Agreement Full-text copies of the Plan Exhibits are available for free at http://bankrupt.com/misc/Tribune_PlanSupp0131.pdf Preliminary Voting Results Show Overwhelming Support for DCL Plan In a letter sent to Judge Carey on February 4, James F. Bendernagel, Jr., at Sidley Austin LLP, in Washington, D.C., as counsel to the Debtors, said votes for the DCL Plan as well as the Noteholder Plan proposed by a group of noteholders led by Aurelius Capital Management, LP, have now been cast. On a preliminary basis, the DCL Plan has received overwhelming support from most major creditor constituencies, Mr. Bendernagel said. By contrast, the Noteholder Plan, on a preliminary basis, did not receive widespread support, as it was rejected overwhelmingly by most creditor constituencies, including all lender classes and virtually every class of general unsecured claims at all Debtors, Mr. Bendernagel added. The Competing Plans The Honorable Kevin J. Carey has scheduled a hearing for 10:00 a.m. on March 7, 2011, to consider confirmation of one of the three plans of reorganization proposed for Tribune Company and certain of its subsidiaries in its Chapter 11 proceeding. Judge Carey approved a General Disclosure Statement and three Specific Disclosure Statements describing the competing plans on Dec. 9, 2010. The competing plans before the Court are proposed by: (1) Tribune Company and its debtor affiliates, the Official Committee of Unsecured Creditors, Oaktree Capital Management, L.P., Angelo, Gordon & Co., L.P., and JPMorgan Chase Bank, N.A.; (2) Aurelius Capital Management, LP, Deutsche Bank Trust Company Americas, Law Debenture Trust Company of New York, and Wilmington Trust Company; and (3) King Street Acquisition Company, LLC, King Street Capital, LLP and Marathon Asset Management, L.P. King Street, et al., known as the Bridge Lender Group, have withdrawn their proposed Chapter 11 plan. They have agreed to support the Chapter 11 plan proposed by the Debtors. Jan. 28, 2011, is the deadline for creditors to cast their ballots to accept or reject the Plans. Confirmation objections must be filed and served by Feb. 15, 2011. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Aurelius, et al., File Supplements to Proposed Plan --------------------------------------------------------------- Aurelius Capital Management, LP, on behalf of its managed entities; Deutsche Bank Trust Company Americas, in its capacity as Successor Indenture Trustee for certain series of Senior Notes; Law Debenture Trust Company of New York, in its capacity as Successor Indenture Trustee for certain series of Senior Notes; and Wilmington Trust Company, in its capacity as Successor Indenture Trustee for the PHONES Notes filed supplements to the Plan of Reorganization they filed for the Debtors. The Plan supplements are: * Claims Purchase Agreement, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_A.pdf * Non-exclusive list of the LBO-Related Causes of Action and Defendants, available for free at: http://bankrupt.com/misc/7802_B.pdf * Terms of New Warrant Agreement, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_C.pdf * Restructuring Transactions, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_D.pdf * Certificate of Incorporation of Reorganized Tribune, a full-text copy of which is available for free at: http://bankrupt.com/misc/7802_E.pdf * By-Laws of Reorganized Tribune, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_F.pdf * Terms of New Senior Secured Term Loan, a full-text copy of which is available for free at: http://bankrupt.com/misc/7802_G.pdf * Terms of Exit Facility, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_H.pdf * Litigation Trust Agreement, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_I.pdf * Creditors' Trust Agreement, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_J.pdf * Distribution Trust Agreement, a full-text copy of which is available for free at http://bankrupt.com/misc/7802_K.pdf The Competing Plans The Honorable Kevin J. Carey has scheduled a hearing for 10:00 a.m. on March 7, 2011, to consider confirmation of one of the three plans of reorganization proposed for Tribune Company and certain of its subsidiaries in its Chapter 11 proceeding. Judge Carey approved a General Disclosure Statement and three Specific Disclosure Statements describing the competing plans on Dec. 9, 2010. The competing plans before the Court are proposed by: (1) Tribune Company and its debtor affiliates, the Official Committee of Unsecured Creditors, Oaktree Capital Management, L.P., Angelo, Gordon & Co., L.P., and JPMorgan Chase Bank, N.A.; (2) Aurelius Capital Management, LP, Deutsche Bank Trust Company Americas, Law Debenture Trust Company of New York, and Wilmington Trust Company; and (3) King Street Acquisition Company, LLC, King Street Capital, LLP and Marathon Asset Management, L.P. King Street, et al., known as the Bridge Lender Group, have withdrawn their proposed Chapter 11 plan. They have agreed to support the Chapter 11 plan proposed by the Debtors. Jan. 28, 2011, is the deadline for creditors to cast their ballots to accept or reject the Plans. Confirmation objections must be filed and served by Feb. 15, 2011. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Bridge Lender Group Withdraws Proposed Plan ------------------------------------------------------- In accordance with the settlement dated January 28, 2011, King Street Acquisition Company LLC, King Street Capital, L.P. and Marathon Asset Management, L.P., withdrew: (a) the Amended Plan of Reorganization they proposed for Tribune Company and its subsidiaries December 7, 2010; (b) the Amended Specific Disclosure Statement for the Joint Plan of Reorganization for Tribune Company and its subsidiaries proposed by the Bridge Proponents dated December 7, 2010; and (c) the Bridge Proponents' Responsive Statement dated November 9, 2010. In accordance with the Bridge Settlement Term Sheet, the Bridge Plan Proponents will not seek confirmation of the Bridge Plan. The Bridge Loan Plan Proponents also withdrew their requests for production of documents directed to the Debtors, Oaktree Capital Management, L.P., Angelo, Gordon & Co., L.P., the Official Committee of Unsecured Creditors, and JPMorgan Chase Bank, N.A. As reported in the Feb. 1, 2011 edition of the Troubled Company Reporter, Tribune has reached an agreement with the Bridge Lender Group -- composed of King Street Acquisition Company, LLC, King Street Capital, LLP and Marathon Asset Management, L.P. -- regarding the terms of a Chapter 11. The Bridge Lender Group agreed to withdraw the plan it has proposed in the Chapter 11 case and instead support the Chapter 11 plan proposed by the Debtors, subject to amendments. The Bridge Loan Settlement provides, among other things, that on the Effective Date of Tribune's Plan, the Bridge Lenders will receive their pro rata share of $64.5 million in cash. On the Effective Date, the Bridge Lenders will also receive their pro rata share of the LBO Lenders' share of the Litigation Trust Interest and Creditors' Trust Interests. The Bridge Loan Settlement further provides that the Plan will be amended to reflect that the Bridge Arrangers (JPMorgan, Citibank, Merrill Lynch and Bank of America) and their affiliates will have the option to either: (a) receive their pro rata shares of the $64.5 million to be distributed to the Bridge Lenders and receive no additional releases from the other Bridge Lenders; or (b) exchange mutual releases with the other Bridge Lenders and the current Bridge Loan Agent, in form and substance reasonably satisfactory to the Arrangers, providing for the unconditional release of any and all claims related to Tribune, the leveraged buyout transactions, the financings related thereto and the Chapter 11 proceedings in lieu of receiving: (i) their pro rata share of the $64.5 million cash distribution on account of their Bridge Loan Claims held for their own accounts; and (ii) their pro rata share of the Litigation Trust Interests and Creditors' Trust Interests as provided under the Plan on account of their Bridge Loan Claims held for their own accounts. 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: DIP Lenders Cry Default, Defend Sale Plea ------------------------------------------------------- BankruptcyData.com reports that D.I.P. lenders Obsidian Agency Services, Tannenbaum, and Special Value Continuation Partners filed with the U.S. Bankruptcy Court a reply in support of their emergency motion seeking approval of an order that a) terminates or modifies the Debtor's use of cash collateral b) schedules a global auction for the remaining unsold assets and c) lifts agreed injunctions against exercising remedies against non-debtors. According to the lenders, "The Debtors have been in violation of the original terms of the DIP Loan and the DIP Order since at least September 25, 2010, and are currectly in violation of the order entered by the Court on November 29, 2010 regarding use of cash collateral. This follows a pattern of repeated breaches by the Debtors and failures to adhere to representations they made to the Court and the Secured Lenders regarding adequate protection that would be provided to the Secured Lenders." As reported in the Troubled Company Reporter on Feb. 9, 2011, BankruptcyData.com said Trico Marine Services' official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to D.I.P. lender Tannenbaum's emergency motion seeking approval of an order that a) terminates or modifies the Debtor's use of cash collateral b) schedules a global auction for the remaining unsold assets and c) lifts agreed injunctions against exercising remedies against non-debtors. According to the Committee, "The motion seriously exaggerates the extent of the Debtors' default, if any, and seeks an unconscionably drastic remedy that will penalize the other creditors of this estate." 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. TSO INC: Files List of 20 Largest Unsecured Creditors ----------------------------------------------------- TSO, Inc., filed with the U.S. Bankruptcy Court for Eastern District of Virginia a list of its 20 largest unsecured creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ PMI $500,000.00 P.O. Box 34370 Richmond, VA 23234 Hanover County Treasurer Real Estate Taxes $20,000.00 P.O. Box 91730 Richmond, VA 23291 United Pacific $20,000.00 1751 E. Del Amo Blvd Carson, CA 90746 ECS Mid-Atlantic $11,000.00 Hanover County $10,899.75 Rappahannock Electric Coop. $10,464.68 DAS Distributors $10,000.00 GOTO Premium Finance $7,423.18 Virginia Dept. of Taxation Sales and Use Tax $7,000.00 Sysco Virginia $4,703.94 Patrick J. Curran $4,475.10 Carter Machinery $4,151.65 SDI $3,676.23 Delta Products $3,000.00 H.D. Supply Facilities $2,302.23 Robert Elgart & Son $2,160.78 Choice Hotels International $2,116.09 Hi-Way Distributing $1,981.60 Store Chek Systems $1,591.00 Virginia Dept. of Taxation Withholding taxes $1,400.00 for employees About TSO Inc. Doswell, Va.-based TSO, Inc., dba Doswell Truck Stop, Roady's of Doswell, Econolodge at the Park, filed for Chapter 11 relief on December 13, 2010 (Bankr. E.D. Va. Case No. 10-38524). Roy M. Terry, Jr., Esq., at DurretteBradshaw PLC, in Richmond, Va., represents the Debtor as counsel. In its petition, the Debtor estimated assets of $10 million to $50 million, and debts of $1 million to $10 million. TSO INC: Files Schedules of Assets and Liabilities -------------------------------------------------- TSO Inc. delivered its schedules of assets and liabilities to the U.S. Bankruptcy for the Eastern District of Virginia, disclosing: Name of Schedule Assets Liabilities ---------------- ------------ ----------- A. Real Property $15,000,000 B. Personal Property $817,536 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $7,752,117 E. Creditors Holding Unsecured Priority Claims $31,455 F. Creditors Holding Unsecured Non-priority Claims $590,282 ------------ ------------ TOTAL $15,817,536 $8,373,854 A full-text copy of the Schedules of Assets and Liabilities is available for free at http://ResearchArchives.com/t/s?730f Seattle, Washington-based MTR Leasing, LLC, filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. W.D. Wash. Case No. 10-23761). George S Treperinas, Esq., at Karr Tuttle Campbell, assures the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. Affiliate Frederick D. Berg (Bankr. W.D. Wash. Case No. 10-18668) filed separate Chapter 11 petition on July 27, 2010. TWIN CITY: Wants to Extend Plan Filing Deadline to May 12 --------------------------------------------------------- Twin City Hospital asks U.S. Bankruptcy Court for the Northern District of Ohio to extend its exclusive period to file a Chapter 11 plan of reorganization to May 12, 2011, and solicit acceptances of that plan until July 11, 2011. The Debtor tells the Court that its seeks to propose a consensual plan, but needs additional time to formulate and negotiate the details. The requested extension is intended to facilitate an orderly, efficient, and cost-effective reorganization process for the benefit of all creditors. The Debtor and its investment banker Navigant Capital Advisors LLC have dedicated significant resources to formulating and implementing a sale process for substantially all of the Debtor's assets. Specifically, the Debtor and Navigant have identified potential third parties that may be interested in purchasing the assets of the Debtor, have reached out to such third parties and are in the process of determining the level of such third parties' interest. The Debtor and Navigant have updated, and will continue to update, counsel for both Wells Fargo Bank, National Association, Master Trustee and the Official Committee of Unsecured Creditors on the progress of this sale process. About Twin City Hospital Dennison, Ohio-based Twin City Hospital filed for Chapter 11 bankruptcy protection on October 13, 2010 (Bankr. N.D. Ohio Case No. 10-64360). Shawn M. Riley, Esq., at McDonald Hopkins LLC, assists the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $10 million to $50 million. UNIGENE LABORATORIES: To Sell Property to RCP Birch for $1.2MM -------------------------------------------------------------- On January 31, 2011, Unigene Laboratories, Inc., entered into an Agreement for Sale of Real Estate by and between the Company and RCP Birch Road, L.L.C. Under the terms of the Agreement, the Company will sell to the Purchaser the Company's real property located at 110 Little Falls Road, Fairfield, NJ, with the buildings and improvements thereon, and any furniture, machinery, equipment and other personal property that the Company owns and uses to operate, repair and maintain the property. The Purchaser will pay the Company an aggregate purchase price of $1,200,000 (i) by a deposit of $60,000 payable within ten business days of the Signing Date, which will be held in escrow until the transfer of the title of the Property or the occurrence of certain other events, as described in the Agreement, and (ii) with the remaining balance of $1,140,000 payable at the Closing. The Closing, which will occur no later than April 29, 2011, is subject to the receipt of the release of existing mortgages on the Property and to certain other conditions and contingencies, including, without limitation, that: (i) the Purchaser will conduct due diligence regarding the Property and the proposed transaction commencing on the Signing Date and ending on the sixtieth day thereafter; (ii) the Purchaser will obtain a financing commitment for this transaction within forty-five days of the Signing Date; and (iii) the Company and the Purchaser will execute and deliver a lease, pursuant to which the Company will lease the Property from the Purchaser for an initial term of seven years, which may be extended for one renewal term of five years, for an annual base rent during the initial term ranging from $135,000 to $145,000, and up to approximately $156,000 in the renewal term. The Agreement is subject to certain termination provisions, including, without limitation, that the Purchaser may terminate the Agreement, for any or no reason, by delivering a notice to the Company no later than the Due Diligence Termination Date, and either party may terminate this Agreement upon notice if the Purchaser cannot obtain Financing by the Mortgage Contingency Date. Upon either of these events, the Deposit, with all interest earned thereon, will be released from escrow and returned to the Purchaser. Except for its status as a contractual document that establishes and governs the legal relations among the parties thereto with respect to the transactions described in this Current Report on Form 8-K, the Agreement is not intended to be a source of factual, business or operational information about the parties. The representations, warranties, covenants and agreements made by the parties in the Agreement are made as of specific dates. The assertions embodied in those representations and warranties were made for purposes of the Agreement and are subject to qualifications and limitations agreed to by the respective parties in connection with negotiating the terms of the Agreement. In addition, certain representations and warranties were made as of a specific date, may be subject to a contractual standard of materiality different from what might be viewed as material to stockholders or may have been used for the purpose of allocating risk between the respective parties rather than establishing matters as facts. About Unigene Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/ -- is a biopharmaceutical company focusing on the oral and nasal delivery of large-market peptide drugs. The Company's balance sheet at Sept. 30, 2010, showed $25.66 million in total assets, $62.50 million in total liabilities, and a stockholders' deficit of $36.83 million. Grant Thornton LLP, in New York, expressed substantial doubt about Unigene Laboratories' ability to continue as a going concern following the Company's 2009 results. The firm noted that the Company has incurred a net loss of $13,400,000 during the year ended December 31, 2009 and has an accumulated deficit of approximately $143,000,000 as of December 31, 2009. As of that date, the Company's current liabilities exceeded its current assets by $1,251,000 and its total liabilities exceeded total assets by $30,442,000. VENTO FAMILY: Taps Timothy Cory Associates as Counsel ----------------------------------------------------- Vento Family Trust asks the U.S. Bankruptcy Court for the District of Nevada for permission to employ Timothy S. Cory & Associates as counsel. The firm is expected to: a) institute, prosecute or defend any lawsuits, adversary proceedings and contested matters arising out this bankruptcy proceeding in which the Debtor may be a party; b) assist in the recovery and obtaining necessary Court approval for recovery and liquidation of estate assets, and to assist in the protecting and preserving the same where necessary; c) assist in determining the priorities and status of claims and filing objections thereto where necessary; d) assist in preparation of a disclosure statement and plan of reorganization; and e) advise the Debtor and perform all other legal services for the Debtor which may become necessary in this bankruptcy proceeding. The firm's hourly rates are: Designation Hourly Rates ----------- ------------ Attorneys $425 Law Clerks $165 Paralegals $125 The Debtor assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Based in Henderson, Nevada, Vento Family Trust filed for Chapter 11 bankruptcy protection on Dec. 27, 2010 (Bankr. D. Nev. Case No. 10-33909). Judge Mike K. Nakagawa presides over the case. Timothy S. Cory, Esq., at Tinoth S. Cory & Associates, represents the Debtor. The Debtor estimated both assets and debts of between $10 million and $50 million. VENTO FAMILY: Files Schedules of Assets and Liabilities ------------------------------------------------------- Vento Family Trust filed with the U.S. Bankruptcy Court for the District of Nevada its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------------ ----------- A. Real Property B. Personal Property $12,825,000 C. Property Claimed as Exempt D. Creditors Holding $815,000 Secured Claims $10,807,000 E. Creditors Holding Unsecured Priority Claims $45,000 F. Creditors Holding Unsecured Non-priority Claims $407,400 ------------ ------------ TOTAL $13,640,000 $11,259,400 A full-text copy of the Schedules of Assets and Liabilities is available for free at http://ResearchArchives.com/t/s?731d Based in Henderson, Nevada, Vento Family Trust filed for Chapter 11 bankruptcy protection on Dec. 27, 2010 (Bankr. D. Nev. Case No. 10-33909). Judge Mike K. Nakagawa presides over the case. Timothy S. Cory, Esq., at Tinoth S. Cory & Associates, represents the Debtor. The Debtor estimated both assets and debts of between $10 million and $50 million. WASHINGTON MUTUAL: Judge Says Shareholder Appeal Untimely --------------------------------------------------------- Bankruptcy Law360 reports that Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware on Tuesday has denied as premature a Washington Mutual Inc. shareholder group's bid to ask the Third Circuit to weigh in on a bankruptcy court order greenlighting the $10 billion settlement central to the defunct bank's reorganization plan. Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. Fred S. Hodera, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York City and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unseucred Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired WaMu's assets prior to the Petition Date. WHITEHALL AVENUE: Meeting of Creditors Set for Feb. 28 ------------------------------------------------------ Joe Wojtas at The Day reports that a meeting of creditors of Whitehall Avenue LLC, owner of the Ramada Inn on Route 27 in Mystic, Connecticut, will take place on Feb. 28, 2011, in federal court in New Haven Whitehall Avenue owes the town $104,624 in back taxes, $29,294 in sewer use fees and $1,864 in trash pickup bills. According to the report, Whitehall Avenue filed for bankruptcy after being hit by lawsuits from eight entities in Connecticut court. In addition, a large group of people who say they had $276 annual pool memberships at the hotel say they have now lost their money. One member said the hotel collected money from her as late as Nov. 30, 2010. CIT Lending Service Corp. of Livingston, New Jersey, held the $4.6 million mortgage on the hotel. Based in Trumbull, Connecticut, Whitehall Avenue LLC filed for Chapter 11 bankruptcy protection on Jan. 24, 2011 (Bankr. D. Conn. Case No. 11-50100). Judge Alan H.W. Shiff presides the case. Peter L. Ressler, Esq., at Groob Ressler & Mulqueen, represents the Debtor. The Debtor estimated assets of less than $50,000, and debts of between $1 million and $10 million. WIKILOAN INC: Founder Returns Close to 10MM Shares to Treasury -------------------------------------------------------------- WikiLoan, Inc. announced that Founder, Edward C. DeFeudis, is returning 9,837,500 shares to the treasury whereby reducing the outstanding shares by close to 17.5%. "The reduction of our outstanding shares will strengthen our position as we prepare for many upcoming changes. The company will communicate with shareholders on a consistent basis as the events take place," said Edward C. DeFeudis, WikiLoan's President and founder. "We believe the structural change is a critical component to attract corporate alliances, while we remain focused on enhancing shareholder value." About WikiLoan Inc. Los Angeles, Calif.-based WikiLoan, Inc. -- http://wikiloan.com/- - is a Web site that provides tools for person-to-person borrowing and lending. People can use the tools on the website to borrow and lend money ($500 to $25,000) among themselves at rates that make sense to all parties. WikiLoan provides management tools that allow Borrowers and Lenders to manage the process by: providing loan documentation, promissory notes, repayment schedules, email reminders, online account access, and online repayment. The Company's balance sheet at October 31, 2010, showed $1.00 million in total assets, $1.93 million in total liabilities, and a stockholders' deficit of $926,455. PS Stephenson & Co., P.C., in Wharton, Tex., expressed substantial doubt about WikiLoan's ability to continue as a going concern following the Company's results for the fiscal year ended January 31, 2010. The independent auditors noted that the Company has no revenue, significant assets or cash flows. WINGATE AIRPORT: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Wingate Airport South, LLC 375 Warm Springs Road, Suite 100 Las Vegas, NV 89119 Bankruptcy Case No.: 11-11950 Chapter 11 Petition Date: February 11, 2011 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Mike K. Nakagawa Debtor's Counsel: Neil J. Beller, Esq. NEIL J. BELLER, LTD. 7408 W. Sahara Ave. Las Vegas, NV 89117 Tel: (702) 368-7767 Fax: (702) 368-7720 E-mail: nbeller@njbltd.com Scheduled Assets: $12,000,000 Scheduled Debts: $9,497,529 The petition was signed by Ronald J. Robinson, managing member. Debtor's List of three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Park Place Properties, Building $6,657,997 LLC Ronald J. Robinson, Managing Member 375 E. Warm Springs Road Suite 102 Las Vegas, NV 89119 Crowne Tradewinds, LLC Construction $605,842 323 Orville Wright Court Services Las Vegas, NV 89119 Clark County Treasurer Property $43,631 500 S Grand Central Taxes Parkway PO Box 551220 Las Vegas, NV 89155-1220 WJO INC: Committee Taps Keifer & Tsarouhis as Counsel ----------------------------------------------------- The Official Committee of Unsecured Creditors of WJO Inc. asks the U.S. Bankruptcy Court for the Eastern District of Pennsylvania for permission to retain Keifer & Tsarouhis LLP as its counsel. The firm agrees to, among other things: a) advise the Committee generally regarding matters of bankruptcy law in connection with this Chapter 11 case; b) advise the Committee of the requirements of the Bankruptcy Code, the Bankruptcy Rules, applicable local bankruptcy rules pertaining to the administration of the Chapter 11 cases and U.S. Trustee guidelines; c) prepare motions, applications, answers, proposed orders, reports and papers on behalf of the Committee; d) prepare before the Court, any appellate courts and the United States Trustee and protect the interest of the Committee; and e) advise the Committee regarding bankruptcy related litigation and employment matters. The firm's attorneys are: Attorneys Hourly Rates --------- ------------ David C. Schattenstein, Esq. $275 Demetrios Tsarouhis, Esq. $225 Richard Kefier, Esq. $225 Paralegal $80 The Committee assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Bristol, Pennsylvania-based WJO, Inc., operates six family practices located in Newtown, Bristol, Bensalem, Bustleton, South Philadelphia, and Bethlehem, Pennsylvania and consists of Board Certified Osteopathic Physicians specializing in Family Medicine. WJO filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. E.D. Pa. Case No. 10-19894). Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. WJO INC: U.S. Trustee Forms Three-Member Creditor's Committee ------------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, appointed three creditors to serve on the Official Committee of Unsecured Creditors of WJO Inc. The members of the Committee are: a) Amber Veszpremi 5165 Hoffert Street Bethlehem, PA 18015 Tel: 610-419-2114; b) Ripple Design 4444 N. 4th Street Suite 102 Philadelphia, PA 19123 Tel: 703-309-9117 Fax: 678-960-1158 c) CCA Financial LLC Glen Forest Drive Henrico, VA 23226 Tel: 804-285-5500 Fax: 804-285-0551 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. WJO filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. E.D. Pa. Case No. 10-19894). Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. WJO INC: U.S. Trustee Wants Case Converted to Chapter 7 ------------------------------------------------------- Roberta A. DeAngelis, U.S. Trustee for Region 3, asks the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to convert the Chapter 11 case of WJO, Inc., to one under Chapter 7 of the Bankruptcy Code. The U.S. Trustee explains that the Debtor, among other things: -- failed to timely comply with the U.S. Trustee Operating Guidelines and Reporting Requirements for Chapter 11 cases. The Debtor has not file Monthly Operating Reports since inception. -- The Debtor owes quarterly fees for the fourth quarter of 2010. However, without operating reports, it is not possible to determine the amount due; although the minimum due is $325. About WJO, Inc. Bristol, Pennsylvania-based WJO, Inc., operates six family practices located in Newtown, Bristol, Bensalem, Bustleton, South Philadelphia, and Bethlehem, Pennsylvania and consists of Board Certified Osteopathic Physicians specializing in Family Medicine. WJO filed for Chapter 11 bankruptcy protection on November 15, 2010 (Bankr. E.D. Pa. Case No. 10-19894). Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy counsel. The Debtor disclosed $19,923,802 in assets and $6,805,255 in liabilities as of the Chapter 11 filing. W.R. GRACE: District Court Sets Status Conference for Feb. 16 ------------------------------------------------------------- The Hon. Ronald L. Buckwalter, S.J., of the U.S. District Court for the District of Delaware scheduled a status conference in the bankruptcy cases of W.R. Grace & Co. and its debtor affiliates for Wednesday, February 16, 2011, at 10:00 a.m., at the Courtroom 14A of the United States Courthouse, 601 Market Street, in Philadelphia, Pennsylvania. As reported in the Feb. 3, 2011 edition of the Troubled Company Reporter, Judge Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware approved on January 31, 2011, the Joint Plan of Reorganization proposed by W.R. Grace & Co. and its debtor affiliates, the Official Committee of Equity Security Holders, the Official Committee of Asbestos-related Personal Injury Claimants, and the Future Claims Representative. Grace's Joint Plan will next be considered for confirmation by the United States District Court for the District of Delaware, a necessary step before Grace may exit Chapter 11. Judge Fitzgerald confirmed the Plan after resolving all outstanding objections and finding that the Plan satisfies all applicable sections of the Bankruptcy Code, including Section 524(g). Judge Fitzgerald held that claimants in Classes 6, 7 (including both sub-classes 7A and 7B), and 8 have voted to accept the Plan in the requisite numbers and amounts required by Sections 524(g), 1126, and 1129. The Joint Plan establishes two asbestos trusts to compensate personal injury claimants and property owners. Funds for the trusts will come from a variety of sources including cash, warrants to purchase Grace common stock, deferred payment obligations, insurance proceeds and payments from successor companies. The trusts' assets and operations are designed to cover all current and future asbestos claims, according to the Debtors. The Debtors filed for bankruptcy in April 2001 because of increasing asbestos personal injury claims. They have submitted several plans of reorganizations co-proposed by different parties-in-interest since the Petition Date. The most recent plan was filed in November 2008 and incorporated settlements of the Debtors' present and future asbestos-related PI Claims. In April 2008, the Debtors reached an agreement settling all of their present and future asbestos-related PI claims for $1.8 billion. Prior to the agreement, the Debtors were involved in a series of trials to estimate their asbestos personal injury claims. Grace's experts estimated that the company's asbestos personal injury liabilities are between $385 million and $1.314 billion. The PI Committee, representing more than 100,000 asbestos claimants, said Grace's liabilities range from $4.7 billion to $6.2 billion. Pursuant to the April 2008 settlement, the asbestos trusts will be funded by: -- Cash in the amount of $250,000,000; -- Warrants to acquire 10,000,000 shares of Grace common stock at an exercise price of $17.00 per share, expiring one year from the effective date of a plan of reorganization; -- Rights to proceeds under Grace's asbestos-related insurance coverage; -- The value of cash and stock under the litigation settlement agreements with Sealed Air Corporation and Fresenius Medical Care Holdings, Inc.; and -- Deferred payments at $110,000,000 per year for five years beginning in 2019, and $100,000,000 per year for 10 years beginning in 2024; the deferred payments would be obligations of Grace backed by 50.1% of Grace's common stock to meet the requirements of Section 524(g). The Sealed Air settlement payment consists of (i) $512,500,000 in cash, plus interest accrued from December 21, 2005 until the Plan's effective date, at a rate of 5.5% per annum compounded annually; and (ii) 18,000,000 shares of Sealed Air common stock. As of January 31, 2011, Eastern Time, Sealed Air stocks are priced at $26.69 per share, placing a value of about $480,420,000 on the settlement pact. In a company statement, Sealed Air said it will review the Bankruptcy Court's confirmation order to ensure that the Debtors implement the Plan in a manner fully consistent with a settlement agreement signed on November 20, 2003. Sealed Air added that it stands ready to contribute its payment directly to one or more of the trusts to be created under Section 524(g) once the provisions of the settlement agreement are fully met. Sealed Air noted that as of December 31, 2010, its total cash payment would have been approximately $788 million, which reflects the principal settlement amount of $512.5 million and $275.5 million of accrued interest, which accrues at 5.5% per annum and is compounded annually. Sealed Air's payment to the Debtors would resolve all current and future asbestos-related, fraudulent transfer and successor claims the Debtors have against Sealed Air as a result of the Cryovac transaction with W. R. Grace in 1998. The Debtors will also fund a trust created for Canadian Zonolite Attic Insulation Claims. In a recently amended settlement, the Debtors' contribution to the Fund is increased from C$6,500,000 to C$8,595,632 in the event the U.S. Confirmation Order is entered by the U.S. Court on or before January 31, 2011; and C$9,095,632 in the event that the U.S. Confirmation Order is entered by the U.S. Court after January 31, 2011, but on or before July 31, 2011. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Reports Fourth Quarter 2010 Financial Results --------------------------------------------------------- W. R. Grace & Co. (NYSE: GRA) announced its financial results for the fourth quarter and year ended December 31, 2010. The following are performance measures for the fourth quarter: * Sales increased 2.2% to $693.0 million from $678.3 million in the prior year quarter. Sales increased 4.1% overall and 8.1% in emerging regions excluding sales of the Advanced Refining Technologies LLC joint venture from both periods. * Adjusted EBIT increased 31.6% to $79.6 million from $60.5 million in the prior year quarter. Adjusted EPS was $0.62 compared with $0.47 in the prior year quarter. * Grace net income decreased 3.2% to $44.9 million in the fourth quarter compared with $46.4 million in the prior year quarter. Grace's diluted EPS was $0.60 compared with $0.63 in the prior year quarter. * Adjusted Operating Cash Flow was $141.2 million in the fourth quarter. * Adjusted EBIT Return on Invested Capital was 27.8% on a trailing four quarter basis. "We had a good quarter and a very good year," said Fred Festa, Grace's Chairman, President and Chief Executive Officer. "I am pleased with the progress we are making in building a stronger company, and we are well positioned for a successful 2011. We are making important investments in our businesses, particularly in the emerging regions, which will continue to drive our growth in sales, earnings, and returns to shareholders." Grace completed acquisitions with an aggregate purchase price of $34.7 million in the fourth quarter. These acquisitions support Grace's strategies to grow in emerging regions and to expand into adjacent product technologies. Fourth Quarter Results Sales increased 4.1% overall and 8.1% in emerging regions compared with the prior year quarter, excluding sales of the ART joint venture from both periods. The sales increase was due to higher sales volumes (5.3%) and improved pricing (1.4%), partially offset by unfavorable currency translation (2.6%). As reported, sales were $693.0 million compared with $678.3 million in the prior year quarter, an increase of 2.2%. Sales in emerging regions were 34.0% of total Grace sales in the fourth quarter. Gross profit percentage was 34.9% compared with 36.6% in the prior year quarter. The decrease in gross profit percentage was due primarily to higher raw material costs partially offset by improved prices and better operating leverage. Gross profit percentage for the fourth quarter decreased 1.1 percentage points compared with the 2010 third quarter due primarily to product mix in Grace Davison and seasonably lower operating leverage and higher raw material costs in GCP. Adjusted EBIT was $79.6 million, an increase of 31.6% compared with $60.5 million in the prior year quarter. Adjusted EBIT margin was 11.5% compared with 8.9% in the prior year quarter. The increase in Adjusted EBIT was due primarily to the increase in sales volumes and lower operating expenses compared with the prior year quarter. Grace net income for the fourth quarter was $44.9 million, or $0.60 per diluted share, compared with $46.4 million, or $0.63 per diluted share, in the prior year quarter. Grace net income in the prior year quarter included a net benefit from income taxes related primarily to the settlement of a tax matter with the U.S. Internal Revenue Service compared with a net provision for income taxes in the 2010 fourth quarter. On November 30, 2009, Grace completed the sale of a 5% interest in ART, its joint venture with Chevron Products Company. Grace deconsolidated ART's results from its consolidated financial statements on a prospective basis effective December 1, 2009. As a result, Grace now reports its investment in ART and its portion of ART's income using the equity method of accounting. Grace's sales and gross profit percentage excluding ART would have been $665.7 million and 36.7%, respectively, in the prior year quarter. Adjusted EBIT is not affected by the deconsolidation of ART except for the effect of the reduction in Grace's ownership from 55% to 50%. Full Year Results Sales increased 3.3% overall and 13.2% in emerging regions for 2010 compared with the prior year period, excluding sales of the ART joint venture from both periods. The sales increase was due to higher sales volumes (3.4%) and improved pricing (0.9%), partially offset by unfavorable currency translation (1.0%). As reported, sales were $2,675.0 million compared with $2,825.0 million in the prior year period, a decrease of 5.3% reflecting the deconsolidation of ART in December 2009. Grace net income for 2010 was $207.1 million, or $2.78 per diluted share, compared with $71.2 million, or $0.98 per diluted share, in the prior year period. Grace Davison * Segment operating income up 11% for fourth quarter; up 30% for 2010 Fourth quarter sales for the Grace Davison operating segment, which includes specialty catalysts and materials used in a wide range of industrial applications, were up 5.2% compared with the prior year quarter, excluding sales of the ART joint venture from both periods. The sales increase was due to higher sales volumes (7.1%) and improved pricing (1.8%), partially offset by unfavorable currency translation (3.7%). Sales volumes in the emerging regions increased approximately 10% compared with the prior year quarter. As reported, fourth quarter sales increased 2.3% from $460.8 million in the prior year quarter. Sales of this operating segment are reported by product group as follows: * Refining Technologies -- sales of catalysts and chemical additives used by petroleum refineries were $201.4 million in the fourth quarter, an increase of 7.1% from the prior year quarter, excluding sales of the ART joint venture from both periods. Sales increased 6.2% compared with the 2010 third quarter. As reported, fourth quarter sales increased 0.4% from $200.6 million in the prior year quarter. * Materials Technologies -- sales of engineered materials, coatings and sealants used in industrial and packaging applications were $167.0 million in the fourth quarter. Sales increased 3.9% and sales volumes increased approximately 9% compared with the prior year quarter. Sales in this product group were favorably affected by increased customer demand for industrial and consumer goods across all regions. * Specialty Technologies -- sales of highly specialized catalysts, materials and equipment used in unique or proprietary applications and markets were $102.9 million in the fourth quarter, an increase of 3.5% from the prior year quarter. Sales increased 27.5% in the emerging regions. Sales in this product group were favorably affected by strong demand for polyolefin catalysts. Gross profit percentage was 35.6% compared with 37.1% in the prior year quarter and 36.3% in the 2010 third quarter. The decrease in gross profit percentage compared with the prior year quarter is due primarily to higher raw material costs partially offset by improved prices and better operating leverage. Segment operating income for the fourth quarter was $102.1 million compared with $92.2 million in the prior year quarter, a 10.7% increase due primarily to higher sales volumes, improved pricing, and improved product mix, partially offset by higher costs for certain raw materials and unfavorable currency translation. Segment operating margin was 21.7% compared with 20.0% in the prior year quarter. ART's contribution to segment operating income increased significantly over the 2010 third quarter reflecting the uneven order pattern of the hydroprocessing catalyst business. Sales of the Grace Davison operating segment for 2010 increased 5.9% compared with the prior year, excluding sales of the ART joint venture from both periods. As reported, sales decreased 6.9% from $1,935.4 million in the prior year. Gross profit percentage was 35.8% compared with 31.4% in the prior year. Segment operating income of Grace Davison for the year was $399.6 million, an increase of 30.0% compared with the prior year period. Segment operating margin was 22.2% compared with 15.9% in the prior year. Grace Construction Products * Fourth quarter sales up 2%; Emerging regions sales volumes up 13% Fourth quarter sales for the Grace Construction Products operating segment, which includes Specialty Construction Chemicals (SCC) products and Specialty Building Materials (SBM) products used in commercial, infrastructure and residential construction, were $221.7 million, up 1.9% from the prior year quarter due to higher sales volumes (1.6%) and improved prices (0.8%), partially offset by unfavorable currency translation (0.5%). The higher sales volumes were due primarily to increased demand for SCC products in the Americas and for all products in Asia, partially offset by lower customer demand in Europe. Sales volumes in emerging regions increased approximately 13% compared with the prior year quarter. Grace Construction Products continues to invest for growth in the emerging regions, including new SCC manufacturing locations and SCC and SBM acquisitions during the fourth quarter. Construction spending continued to grow in the fourth quarter in emerging regions. In the United States and certain countries in Europe, however, overall construction spending decreased in the fourth quarter compared with the prior year quarter. The most recent industry data indicates that fourth quarter commercial construction starts in the U.S. were down approximately 10% from the prior year quarter and that fourth quarter residential housing starts decreased approximately 5% from the prior year quarter. Sales of this operating segment are reported by geographic region as follows: * Americas -- sales to customers in the Americas were $114.9 million in the fourth quarter, an increase of 7.2% from the prior year quarter. Sales in North America increased 1.8% due primarily to increased customer demand for SCC products partially offset by weaker customer demand for SBM products. Sales in Latin America grew 35.0% driven by improved pricing, sales to new customers, and better product penetration. Overall sales in the Americas increased $1.9 million, or 1.7%, from the 2010 third quarter. * Europe -- sales to customers in Europe, the Middle East, Africa and India were $62.0 million in the fourth quarter, a decrease of 16.8% from the prior year quarter, due primarily to continued weak customer demand and the effect of severe winter weather on construction activity in North and Central Europe. Sales in this region decreased $7.2 million, or 10.4%, from the 2010 third quarter. * Asia -- sales to customers in Asia (excluding India), Australia and New Zealand were $44.8 million in the fourth quarter, an increase of 25.1% from the prior year quarter. Sales increased due primarily to higher sales volumes to new and existing customers throughout the region. Sales in this region increased $3.2 million, or 7.7%, from the 2010 third quarter. Gross profit percentage was 33.6% in the fourth quarter compared with 36.0% in the prior year quarter and 35.7% in the 2010 third quarter. The decrease in gross profit percentage compared with the prior year quarter is due primarily to higher raw material costs partially offset by improved prices. Segment operating income for the fourth quarter was $20.3 million compared with $21.6 million for the prior year quarter, a 6.0% decrease. The decrease was due primarily to lower gross profit percentage, partially offset by cost savings from restructuring actions taken in 2010. Segment operating margin was 9.2% compared with 9.9% in the prior year quarter. Sales of the Grace Construction Products operating segment for 2010 decreased 1.8% compared with the prior year. Gross profit percentage was 34.8% compared with 36.0% in the prior year. Segment operating income of Grace Construction Products was $89.9 million, a decrease of 12.2% compared with the prior year. Segment operating margin was 10.3% compared with 11.5% in the prior year. Lower sales and segment operating income were due primarily to continued weak customer demand in North America and Europe and raw material inflation, partially offset by increased sales in emerging regions. Corporate Costs Corporate costs decreased $8.6 million in the fourth quarter compared with the prior year quarter. The prior year quarter included costs to settle a commercial dispute and a provision for environmental remediation. Pension Expense Defined benefit pension expense for the fourth quarter was $19.8 million compared with $21.7 million for the prior year quarter, an 8.8% decrease. The decrease in costs was due primarily to strong pension plan asset performance in the U.S. in 2009. Interest Interest expense was $10.2 million for the fourth quarter compared with $9.8 million for the prior year quarter. The annualized weighted average interest rate on prepetition obligations for the fourth quarter was 3.5%. Income Taxes Income taxes are recorded at a global effective tax rate of approximately 32% before considering the effects of certain non- deductible Chapter 11 expenses, changes in uncertain tax positions and other discrete adjustments. Grace has not been required to pay U.S. Federal income taxes in cash in recent years since available tax deductions and credits have fully offset U.S. taxable income. Income taxes in foreign jurisdictions are generally paid in cash. Grace expects to generate significant U.S. Federal net operating losses upon emergence. Income taxes paid in cash, before refunds, were $32.6 million for 2010, or approximately 14% of income before income taxes. Cash Flow Performance Measure Adjusted Operating Cash Flow was $369.2 million for 2010 compared with $415.8 million in the prior year period. The prior year period benefited from a significant reduction of net working capital. Capital expenditures for 2010 were $112.9 million compared with $93.8 million for the prior year period. Net working capital days were 53 days in 2010, compared with 52 days in the prior year period and 56 days in the 2010 third quarter. Chapter 11 proceedings On April 2, 2001, Grace and 61 of its United States subsidiaries and affiliates, including its primary U.S. operating subsidiary W. R. Grace & Co.-Conn., filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware in order to resolve Grace's asbestos-related liabilities. On January 31, 2011, the Bankruptcy Court issued an order confirming Grace's Joint Plan of Reorganization (the "Plan"). The confirmation order must next be confirmed by the United States District Court. The timing of Grace's emergence from Chapter 11 will depend on affirmation of the Plan by the District Court and the satisfaction or waiver of the other conditions set forth in the Plan, including the resolution of any appeals. Grace is preparing to consummate the Plan as quickly as practicable. The Plan sets forth how all prepetition claims and demands against Grace will be resolved. Grace has not adjusted its accounting for asbestos-related assets and liabilities to reflect the Plan. At this time, Grace is unable to determine a reasonable estimate of the value of certain consideration payable to the asbestos trusts under the Plan. These values will ultimately be determined on the effective date of the Plan. Grace expects to adjust its accounting for the Plan when the consideration can be measured and material conditions to the Plan are satisfied. Grace expects that such adjustments may be material to Grace's consolidated financial position and results of operations. 2011 Outlook As of February 10, 2011, Grace expects to report 2011 sales of $2.85 billion to $2.95 billion. Grace expects increased sales of 7% to 10%, resulting from increases in customer demand, new products and other growth initiatives, and improved pricing. Grace expects construction spending to remain weak in 2011 in North America and Western Europe, with stronger spending in Asia, the Middle East and Latin America. Grace expects to maintain its gross profit percentage in the mid-30 percent range. Grace expects to experience higher costs for certain raw materials, including rare earths used in refining catalysts, in 2011 and intends to mitigate these cost increases by increasing prices and improving productivity in its manufacturing and supply chain operations. Grace expects to report 2011 Adjusted EBIT of $365 million to $385 million, an increase of 12% to 18% over 2010, driven primarily by higher sales volumes. Grace also expects to benefit from the full year effects of restructuring actions completed during 2010, partially offset by new investments in sales, technical service, marketing and research and development, primarily in the faster growing emerging regions. Grace expects 2011 Adjusted EBITDA to be $485 million to $505 million. Grace intends to continue its focus on working capital productivity, and expects to further reduce net working capital days in 2011. Grace expects capital expenditures to be approximately $140 million to $150 million. Grace is unable to make a reasonable estimate of the income effects of the consummation of the Plan because the value of certain consideration payable to the asbestos trusts under the Plan (primarily the deferred payments and the warrants) will not ultimately be determined until the effective date of the Plan, the timing of which is uncertain. When the Plan is consummated, Grace expects to reduce its liabilities subject to compromise, including asbestos-related contingencies, recognize the value of the deferred payments and the warrants and recognize expense for the costs of consummating the Plan and the income tax effects of these items. Investor Call Grace discussed the results during an investor conference call and webcast on Feb. 10. An audio replay of the webcast is available until 11:59 p.m. ET on February 17. The replay will be accessible by dialing +1.888.286.8010 (international callers dial +1.617.801.6888) and entering conference call ID #41593400. W. R. Grace & Co. and Subsidiaries Consolidated Balance Sheets (Unaudited) ========================================== Dec. 31, Dec. 31, Amounts in millions 2010 2009 ------------------- -------- -------- ASSETS Current Assets $1,015.7 $893.00 Cash and cash equivalents 97.8 Restricted cash and cash equivalents related to LOC facility 380.8 365.8 Accounts receivable - unconsolidated affiliates 5.3 7.4 Inventories 259.3 220.6 Deferred income taxes 54.7 61.5 Other current assets 90.6 80.4 -------- -------- Total Current Assets 1,904.2 1,628.7 Properties and equipment, net 702.5 690.1 Goodwill 125.5 118.6 Deferred income taxes 845.0 843.4 Asbestos-related insurance 500.0 500.0 Overfunded defined benefit pension plans 35.6 36.7 Investments in unconsolidated affiliates 56.4 45.7 Other assets 102.5 105.0 -------- -------- Total Assets $4,271.7 $3,968.2 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Liabilities Not Subject to Compromise Current Liabilities $37.0 $10.8 Debt payable within one year 2.3 1.8 Loan payable - unconsolidated affiliate Accounts payable 207.1 170.1 Accounts payable - unconsolidated affiliate 8.5 4.1 Other current liabilities 278.0 307.9 -------- -------- Total Current Liabilities 532.9 494.7 Debt payable after one year 2.9 0.4 Loan payable - unconsolidated affiliate 12.6 10.5 Deferred income taxes 34.6 34.2 Unfunded defined benefit pension plans 539.8 530.4 Other liabilities 43.6 41.4 -------- -------- Total Liabilities Not Subject to Compromise 1,166.4 1,111.6 Liabilities Subject to Compromise Debt plus accrued interest 911.4 882.0 Income tax contingencies 97.9 117.9 Asbestos-related contingencies 1,700.0 1,700.0 Environmental contingencies 144.0 148.4 Postretirement benefits 181.1 171.2 Other liabilities and accrued interest 139.7 127.6 -------- -------- Total Liabilities Subject to Compromise 3,174.1 3,147.1 Total Liabilities 4,340.5 4,258.7 Equity (Deficit) Common stock 0.7 0.7 Paid-in capital 455.9 445.9 Accumulated deficit 31.7 (175.4) Treasury stock, at cost (45.9) (55.9) Accumulated other comprehensive income (los (518.1) (514.5) -------- -------- Total W.R. Grace & Co. Shareholders' Equity (Deficit) (75.7) (299.2) Non-controlling interest 6.9 8.7 -------- -------- Total Shareholders' Equity (Deficit) (68.8) (290.5) -------- -------- Total Liabilities and Shareholders' Equity (Deficit) $4,271.7 $3,968.2 ======== ======== W. R. Grace & Co. and Subsidiaries Consolidated Statements of Operations Three Months Ended (Unaudited) Dec. 31 Dec. 31 ========================================== ======== ======== Amounts in millions 2010 2009 ------------------- -------- -------- Net sales $693.0 $678.3 Cost of goods sold 451.3 429.9 -------- -------- Gross profit 241.7 248.4 Selling, general and administrative expense 135.0 148.8 Restructuring expenses 2.1 6.5 Gains on sales of product lines (11.7) Research and development expenses 15.4 17.3 Defined benefit pension expense 19.8 21.7 Interest expense and related financing cost 10.2 9.8 Provision for environmental remediation 4.5 3.3 Chapter 11 expenses, net of interest income 3.3 11.6 Equity in (earnings) losses of (4.8) (2.3) unconsolidated affiliates Other (income) expense, net (0.2) 2.4 -------- -------- 185.3 207.4 Income (loss) before income taxes 56.4 41.0 Benefit from (provision for) income taxes (11.6) 5.5 -------- -------- Net income (loss) 44.8 46.5 Less: Net loss attributable to non-controlling interest 0.1 (0.1) -------- -------- Net income (loss) attributable to W.R. Grace & Co. shareholders $44.9 $46.4 ======== ======== W. R. Grace & Co. and Subsidiaries Consolidated Statements of Operations Twelve Months Ended (Unaudited) Dec. 31 Dec. 31 ========================================== ======== ======== Amounts in millions 2010 2009 ------------------- -------- -------- Net sales $2,675.0 $2,825.0 Cost of goods sold 1,729.6 1,900.5 -------- -------- Gross profit 945.4 924.5 Selling, general and administrative expense 511.2 574.6 Restructuring expenses 11.2 33.4 Gains on sales of product lines (33.9) Research and development expenses 60.3 70.1 Defined benefit pension expense 77.1 85.6 Interest expense and related financing cost 41.3 38.3 Provision for environmental remediation 4.5 4.4 Chapter 11 expenses, net of interest income 17.7 48.0 Equity in (earnings) losses of (17.8) (1.7) unconsolidated affiliates Other (income) expense, net 13.0 -------- -------- 705.5 831.8 Income (loss) before income taxes 239.9 92.7 Benefit from (provision for) income taxes (32.5) (11.5) -------- -------- Net income (loss) 207.4 81.2 Less: Net loss attributable to non-controlling interest (0.3) (10.0) -------- -------- Net income (loss) attributable to W.R. Grace & Co. shareholders $207.1 $71.2 ======== ======== W.R. Grace & Co. and Subsidiaries Consolidated Statements of Cash Flows Twelve Months Ended (Unaudited) Dec. 31 Dec. 31 ========================================== ======== ======== Amounts in millions 2010 2009 ------------------- -------- -------- OPERATING ACTIVITIES Net income (loss) $207.4 $81.2 Reconciliation to net cash provided by (used for) operating activities: Depreciation and amortization 115.6 113.0 Equity in (earnings) losses of unconsolidated affiliates (17.8) (1.7) Provision for income taxes 32.5 11.5 Income taxes (paid), net of refunds (13.8) 28.2 Defined benefit pension expense 77.1 85.6 Payments under defined benefit pension plan (63.3) (61.4) Changes in assets and liabilities, excluding effect of foreign currency translation: Trade accounts receivable (15.8) 96.8 Inventories (37.1) 84.8 Accounts payable 37.3 (32.1) Other accruals and non-cash items 5.6 27.5 -------- -------- Net cash provided by (used for) operating activities 327.7 433.4 INVESTING ACTIVITIES Capital expenditures (112.9) (93.8) Purchase of equity investment (0.2) (2.5) Proceeds from termination of life insurance policies, net (34.7) Transfer to restricted cash related to letter of credit facility (97.8) 68.8 Proceeds from sales of investment securities 22.5 Proceeds from sales of product lines 40.6 Other investing activities 0.7 (9.5) -------- -------- Net cash provided by (used for) investing activities (244.9) 26.1 FINANCING ACTIVITIES Dividends paid to non-controlling interests (40.4) Net repayments under credit arrangements 28.9 (0.4) Proceeds from exercise of stock options 10.4 1.4 Other financing activities 2.2 (1.9) -------- -------- Net cash (used for) financing activities 41.5 (41.3) Effect of currency exchange rate changes on cash and cash equivalents (1.6) 14.7 -------- -------- Increase (Decrease) in cash & cash equivalents 122.7 432.9 Cash and cash equivalents, beginning of per 893.0 460.1 -------- -------- Cash and cash equivalents, end of period $1,015.7 $893.0 ======== ======== About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on January 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Seeks Clarification of Plan Confirmation Order ---------------------------------------------------------- W.R. Grace & Co. and its debtor affiliates, the Official Committee of Equity Security Holders, the Official Committee of Asbestos- related Personal Injury Claimants, and the Future Claims Representative -- the Plan Proponents -- seek clarifications from Judge Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware of the confirmation order she entered on January 31, 2011. According to the Plan Proponents, certain Plan opponents contend that the Bankruptcy Court did not actually enter a confirmation on January 31. The Plan opponents have also apprised the Plan Proponents that they intend to file objections pursuant to Rule 9033 of the Federal Rules of Bankruptcy Procedure, notwithstanding that these same Plan opponents never disputed that the confirmation proceedings were core and that Rule 9033 objections may only be filed in response to "proposed findings of fact and conclusions of law" entered in "non-core proceedings," John Donley, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, relates. The Plan Proponents believe that the two rulings issued on January 31 are clear: in the exercise of its jurisdiction over core plan confirmation proceedings, the Bankruptcy Court (1) entered a confirmation order, expressly stating that "[t]he Plan and each of its provisions . . . are confirmed in each and every respect, (2) made all necessary findings of fact and conclusions of law, including those required by Sections 1129 and 524(g) of the Bankruptcy Code, and overruled all objections to the Plan, and (3) recommended to the U.S. District Court for the District of Delaware that it adopt and enter the Bankruptcy Court's findings of fact and conclusions of law. The case is set for a status conference before the District Court on February 16. Mr. Donley says the Plan Proponents had anticipated that the status conference would address the timing and procedures for appeals of the confirmation order. Now, however, the Plan opponents will create confusion and delay before the District Court if they deny that a confirmation order was entered and contend that they are dueling Rule 9033 and appellate proceedings, he adds. Accordingly, the Plan Proponents ask the Bankruptcy Court to clarify that on January 31: (1) it entered an order confirming the First Amended Joint Plan of Reorganization as modified through December 23, 2010; (2) made findings of fact and conclusions of law, including those required pursuant to Sections 1129 and 524(g), and overruled all objections to the Plan; and (3) recommended to the District Court that it enter the proposed order provided, thereby complying with the requirement of Section 524(g)(3)(A) that the District Court "issue or affirm" the confirmation order. Furthermore, the Plan Proponents ask, as part of the order, that any Rule 9033 objections that may be filed to the Bankruptcy Court's January 31 rulings are improper and will be stricken sua sponte by the Bankruptcy Court because Rule 9033 objections apply only to non-core proceedings. 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) YORK SQUARE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: York Square, LLC 2404 Wilshire Boulevard, Suite 12A Los Angeles, CA 90057 Bankruptcy Case No.: 11-15554 Chapter 11 Petition Date: February 9, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Sheri Bluebond Debtor's Counsel: Alan I. Nahmias, Esq. MIRMAN & BUBMAN & NAHMIAS LLP 21860 Burbank Boulevard, Suite 360 Woodland Hills, CA 91367 Tel: (818) 995-2555 Fax: (818) 451-4620 E-mail: anahmias@mbnlawyers.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/cacb11-15554.pdf The petition was signed by Rick Barreca, managing member. YRC WORLDWIDE: Incurs $322 Million Net Loss in 2010 --------------------------------------------------- YRC Worldwide Inc. reported net income of $23.12 million on $1.09 billion of operating revenue for the three months ended December 31, 2010, compared with net income of $119.54 million on $1.05 billion of operating revenue for the same period a year ago. The Company also reported a net loss of $322.23 million on $4.33 billion of operating revenue for the twelve months ended December 31, 2010, compared with a net loss of $622.02 million on $4.87 billion of operating revenue during the prior year. The Company's balance sheet at December 31, 2010, showed $2.63 billion in total assets, $2.73 billion in total liabilities and $95.84 million in total shareholders' deficit. "We are pleased with the stability we have seen in our absolute business volumes at YRC over the last three quarters and the growth across our Regional companies leading to continued year- over-year improvement in our operating results," stated Sheila Taylor, Executive Vice President, CFO and Treasurer of YRC Worldwide. "Our business is generating positive cash flow and our ability to continually improve our days to collect should provide the needed liquidity as we move through the seasonally slower first quarter." A full-text copy of the press release announcing the Company's financial results is available for free at: http://ResearchArchives.com/t/s?7306 About YRC Worldwide Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ: YRCW) -- http://www.yrcw.com/-- is a holding company that through wholly owned operating subsidiaries offers its customers a wide range of transportation services. These services include global, national and regional transportation as well as logistics. As reported in the Troubled Company Reporter on March 18, 2010, KPMG LLP, in Kansas City, Missouri, expressed substantial doubt about YRC Worldwide's ability to continue as a going concern in its report on the Company's consolidated financial statements as of and for the year ended December 31, 2009. The independent auditors noted that the Company has experienced significant declines in operations, cash flows, and liquidity. * * * In January 2011, Standard & Poor's Ratings Services placed its 'CCC-' corporate credit rating on YRC Worldwide Inc. (YRCW) on CreditWatch developing. At the same time, S&P is withdrawing the existing issue level ratings on Yellow Corp.'s senior unsecured debt, given the negligible amounts outstanding. "The ratings on Overland Park, Kan.-based YRCW reflect its near- term liquidity challenges, meaningful off-balance-sheet contingent obligations related to multiemployer pension plans, as well as its participation in the competitive, capital-intensive, and cyclical trucking industry," said Standard & Poor's credit analyst Anita Ogbara. "YRCW's substantial (albeit deteriorating) market position in the less-than-truckload (LTL) sector, which has high barriers to entry, partially offsets these characteristics. We characterize YRCW's business profile as weak, financial profile as highly leveraged, and liquidity as weak." * SecondMarket Says Bankruptcy Claims Trading Rose 400% in 2010 --------------------------------------------------------------- According to Nick Elliott, writing for The Wall Street Journal's Bankruptcy Blogs, SecondMarket reports that $40 billion bankruptcy claims traded during 2010, a 400% increase over 2009. There were also far more claims traded-11,303 in 2010, compared with 6,612 in 2009. SecondMarket operates a platform for trading illiquid securities such as bankruptcy claims, but its totals reflect market totals culled from public filings. Still, the total value of claims was greatly enlarged by a major case from 2008: Lehman Brothers Holdings Inc. and its broker- dealer unit Lehman Brothers Inc. Together, they accounted for about $36 billion of the total. According to the Journal, SecondMarket's report indicates that other companies that saw a lot of trading in their claims in 2010 were Motors Liquidation Co., formerly General Motors; Smurfit- Stone Container Corp.; and Tribune Co. According to the Journal, Andrew Gottesman, head of bankruptcy claims at SecondMarket, said that 2010 was an unusual year but that the pattern of a big year in bankruptcy filings being followed by a big year in claims trading isn't unusual. "Typically, cases take a while to mature into trading opportunities," he said. As cases roll on and creditors come to terms over dividing assets, more clarity emerges about likely recoveries. * TMA Poll: Most Turnaround Pros Say "No" to State Bankruptcies --------------------------------------------------------------- As the pitch rises over the question of whether to allow states to file for bankruptcy, most turnaround professionals voicing their opinion blend together on a single note: No. Nearly 70% of respondents to a recent Turnaround Management Association poll think struggling states would need to sound a theme other than bankruptcy to solve fiscal problems aggravated by the recent recession. But 32% join a refrain in favor of enacting a U.S. bankruptcy law for states, arguing that it would deftly address onerous union contracts and debt levels and drown out any pleas for federal bailouts. "Allowing states to file bankruptcy to eliminate similar legacy issues that have plagued some major corporations forced to file bankruptcy in recent years will just shift the burden of these liabilities from the states to the federal government without ever addressing the underlying problems," said TMA President Mark S. Indelicato, a managing partner with Hahn & Hessen LLP in New York. In contrast, nearly all (97%) respondents expect to see a rising crescendo of municipal filings under Chapter 9 of the U.S. Bankruptcy Code in 2011. Only 3% think otherwise, in harmony with financial pundits who say recent investor pullback from municipal bond markets arises from new bonds being issued and driving down prices, and not just cash-strapped cities. Fears of financially imploding cities, they say, amount to shrill noise. "Desperate municipalities are looking for solutions to their debt problems leading more of them to consider Chapter 9 filings," said Patrick C. Lagrange, immediate past TMA chairperson and managing director with Carl Marks Advisory Group LLC in New York City. "However, 10th Amendment-based restrictions on this process limit court powers. The hard political choices of cutting services or raising taxes still need to be made regardless of whether a Chapter 9 proceeding is initiated." Chicago-based Turnaround Management Association -- http://www.turnaround.org/-- the only international non-profit association dedicated to corporate renewal and turnaround management, has more than 9,000 members in 47 regional chapters, including turnaround practitioners, attorneys, accountants, investors, lenders, venture capitalists, appraisers, liquidators, executive recruiters and consultants. * * * Rachel Feintzeig, writing for Dow Jones' Daily Bankruptcy Review, reports that former TMA President Patrick Lagrange, a managing director with Carl Marks Advisory Group, cautioned that bankruptcy wasn't necessarily an appropriate road for states to wander down. "It shouldn't be viewed as a panacea," he said of Chapter 9 in an interview Friday. "I don't necessarily see [it] as a solution for the state problems." Government entities -- be they states, cities or shopping center developments funded with tax dollars -- that are struggling to survive on decreased revenues need to make changes to bring their assets and liabilities back into equilibrium, Mr. Lagrange said, according to DBR. That could mean cutting services or raising taxes, but there's no magic wand that will provide a quick fix. "At the end of the day, Chapter 9 is not going to be something that replaces hard political choices that need to be made," Mr. Lagrange said. According to DBR, Mr. Lagrange said, "It's one thing if you're a school district or a city . . . if you start to go to a state, you have layers upon layers of obligations and constituencies and with each layer comes an added layer of complexity." Mr. Lagrange said Chapter 9 of the Bankruptcy Code isn't itself a solution. "It's kind of not an end," he said. "It's a tool for them to affect restructuring." * Michigan Municipalities, School Districts Could Face Insolvency ----------------------------------------------------------------- Grace Wyler at the Business Insider reports that dozens of Michigan's municipalities and school districts could soon face major financial problems and an unnamed handful are on the brink of becoming insolvent, warns State Treasurer Andy Dillon. To prepare for the onslaught, the Business Insider relates, the state treasurer's office will start training 50 emergency financial managers this week to help the state cope with an expected rise in communities facing financial collapse. The training will focus on helping local governments avoid a state financial takeover while emphasizing early intervention, Business Insider reports, citing Bond Buyer. According to the Business Insider, overhauling Michigan's emergency financial management act is a key legislative goal for new Gov. Rick Snyder. He is expected to introduce a bill this week that would strengthen the authority of emergency financial managers and allow the state to intervene more aggressively in financially distressed communities, Business Insider adds. * Missouri's Second Injury Fund Nearing Insolvency, Koster Warns ---------------------------------------------------------------- The Associated Press reports that Missouri Attorney General Chris Koster is warning lawmakers that Missouri's Second Injury Fund is rapidly running out of money and demands quick action. The AP says that the state fund compensates previously injured or disabled workers who suffer additional injuries on the job. According to the AP, studies have warned for several years that the fund is nearing insolvency, but lawmakers have been unable to agree on a solution. The AP notes that Mr. Koster told a House committee Monday that the Second Injury Fund could be temporarily insolvent by next month. Mr. Koster, as cited by the AP, said the fund then is projected to briefly recover before becoming permanently insolvent about the mid-point of 2011. Mr. Koster said the collapse of the fund likely would prompt a lawsuit from those pursuing claims. It also would cause 39 people in his office to be laid off. * 4 Banks Shuttered Friday; Year's Failures Now 18 -------------------------------------------------- Regulators closed on Friday four banks -- Sunshine State Community Bank, Port Orange, Florida; Badger State Bank, Cassville, WI; Canyon National Bank, Palm Springs, California; and Peoples State Bank, Hamtramck, Michigan. This year's failures now total to 18. The Federal Deposit Insurance Corp., as receiver, signed deals for other banks to assume the deposits and take over assets of the four failed banks. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Pacific Premier Bank, Costa Mesa, California, to assume all of the deposits of Canyon National Bank. Royal Bank, Elroy, Wisconsin assumed all of the deposits of Badger State Bank. Premier American Bank, National Association, Miami, Florida, has agreed to assume all of the deposits of Sunshine State Community Bank. The FDIC entered into a purchase and assumption agreement with First Michigan Bank, Troy, Michigan, to assume all of the deposits of Peoples State Bank. First Michigan Bank will pay the FDIC a premium of 0.25% to assume all of the deposits of Peoples State Bank. In addition to assuming all of the deposits of the failed bank, First Michigan Bank agreed to purchase essentially all of the assets. Lenders are failing after the financial crisis drove down home and commercial property values and pushed the unemployment rate above 10%, according to Bloomberg News. 2011 Failed Banks List The FDIC was appointed as receiver for the closed banks. To protect the depositors, the FDIC entered into a purchase and assumption agreement with various banks that agreed to assume the deposits of most of the closed banks. The FDIC also entered into loss-share transactions on assets bought by the banks. For this year, the failed banks are: Loss-Share Transaction Party FDIC Cost Assets of Bank That Assumed to Insurance Closed Bank Deposits & Bought Fund Closed Bank (millions) Certain Assets (millions) ----------- ---------- -------------- ----------- Sunshine State $125.5 Premier American $30.0 Badger State Bank $83.8 Royal Bank $17.5 Canyon National $210.9 Pacific Premier Bank $10.0 Peoples State Bank $390.5 First Michigan Bank $87.4 American Trust Bank $238.2 Renasant Bank $71.5 Community First $51.1 Northbrook Bank $11.7 North Georgia Bank $153.2 BankSouth $35.2 First Community Bank $2,310.0 U.S. Bank, N.A. $260.0 FirsTier Bank $781.5 No Acquirer $242.6 Evergreen State $246.5 McFarland State $22.8 The First State Bank $43.5 Bank 7 $20.1 The Bank of Asheville $195.1 First Bank $56.2 CommunitySouth Bank $440.6 Certus Bank $46.3 Enterprise Banking $100.9 [No Acquirer] $39.6 United Western Bank $2,050.0 First-Citizens Bank $312.8 Oglethorpe Bank $230.6 Bank of the Ozarks $80.4 Legacy Bank, Arizona $150.6 Enterprise Bank & Trust $27.9 First Commercial Bank $598.5 First Southern Bank $78.0 In 2010, there were 157 failed banks, compared with 140 in 2009 and just 25 for 2008. A complete list of banks that failed since 2000 is available at: http://www.fdic.gov/bank/individual/failed/banklist.html 860 Banks Now in FDIC's Problem List The FDIC said in is latest quarterly banking profile that the number of institutions on its "Problem List" rose to 860 as of Sept. 30, 2010 from 829 at June 30, 2010. There were 775 banks on the list at the end of the first quarter. The FDIC, however, pointed out that the total assets of "problem" institutions declined from $403 billion to $379 billion. The number of "problem" institutions is the highest since March 31, 1993, when there were 928. The Deposit Insurance Fund balance -- the net worth of the fund -- was negative $8 billion at the end of the third quarter of 2010 from negative $15.2 billion from June 30, 2010. Chairman Bair said, "The industry has come a long way in cleaning up balance sheets, building capital, and adjusting to changes in financial markets and the economy. But the adjustments are not over, and this is no time for complacency." Problem Institutions Failed Institutions -------------------- ------------------- Year Number Assets (Mil) Number Assets (Mil) ---- ------ ------------ ------ ------------ 2009 702 $402,800 140 $169,700 2008 252 $159,405 25 $371,945 2007 76 $22,189 3 $2,615 2006 50 $8,265 0 $0 2005 52 $6,607 0 $0 2004 80 $28,250 4 $170 * S&P: Global Corporate Default Tally Remains at 2 in 2011 ---------------------------------------------------------- The 2011 global corporate default tally remains at two issuers after no issuers defaulted this week, said an article published Feb. 11 by Standard & Poor's, titled "Global Corporate Default Update (Feb. 4 - 10, 2011) (Premium)." By comparison, 17 global corporate issuers had defaulted by this time last year (14 U.S.- based issuers and one issuer each from Australia, Bahrain, and Canada). Both of this year's defaulters missed interest or principal payments, which were among the top reasons for default last year. Of the defaults in 2010, 28 defaults resulted from missed interest or principal payments, 25 defaults resulted from Chapter 11 and foreign bankruptcy filings, 23 from distressed exchanges, three from receiverships, one from regulatory directives, and one from administration. Standard & Poor's baseline projection for the U.S. corporate trailing 12-month speculative-grade default rate for December 2011 is 1.8%. (A total of 27 issuers would need to default during that period to reach the forecast.) This is another 1.47-percentage-point (or another 45%) decline from 3.27% in December 2010. The rate of decline will remain sharp, but somewhat slower than what was seen in the past 13 months. In S&P's optimistic default rate forecast scenario, the economy and the financial markets improve more than expected. In this scenario, S&P expects the default rate to be 1.3% (22 defaults). On the other hand, if the economic recovery stalls and the financial markets deteriorate -- which is S&P's pessimistic scenario -- S&P expects the default rate to be 3.5% (52 defaults) by the end of 2011. S&P bases its forecasts on quantitative and qualitative factors that it considers, including, but not limited to, Standard & Poor's proprietary default model for the U.S. corporate speculative-grade bond market. S&P updates its outlook for the U.S. issuer-based corporate speculative-grade default rate each quarter after analyzing the latest economic data and expectations. * Obama Gov't Outlines Steps to Phase Out Fannie and Freddie ------------------------------------------------------------ The Wall Street Journal's Nick Timiraos reports that the Obama administration outlined on Friday its plans to begin shrinking the government's broad support of the nation's crippled mortgage market, a process that officials said could take several years and would include phasing out Fannie Mae and Freddie Mac. Mr. Timiraos reports that officials portrayed a housing-finance system that would include a role for both the public and private sectors, but would be different from the current system in that the government's role would be smaller, underwriting standards would be tighter, and borrowers would be required to hold larger amounts of equity in their homes. According to the Journal, Rep. Randy Neugebauer, R-Texas, chairman of a key House oversight subcommittee, is encouraged by the Obama administration's proposal to restructure Fannie Mae and Freddie Mac. But he's disappointed there's no clear long-term reform plan. According to the Journal, the proposal offered a series of short- term steps that would help attract private capital into the mortgage market, including a reduction in the maximum loan sizes that Fannie and Freddie can purchase and gradual increases in the fees the mortgage companies charge lenders. Both of those steps could make it more attractive for lenders and investors to buy loans without government backing, but they could also raise borrowing costs for millions of Americans and weigh on the nation's home-building industry. The Journal relates administration officials said the process of transitioning to a post-Fannie and Freddie world would take at least five to seven years, in part because the housing market remains too fragile. Many analysts say the process, which includes dismantling, moving, or reassembling the firms' infrastructure, could take even longer. According to the Journal, the long-awaited proposal was thin on specifics about what would replace Fannie and Freddie, which the government took over in 2008, and which have racked up $134 billion in taxpayer losses. Instead, it outlined three options that were designed to frame what promises to be a prolonged and heated political debate over how to structure the nation's $10.6 trillion mortgage market: (I) The first of those would put the vast majority of the mortgage market in the hands of the private sector, where lenders would originate mortgages and securitize them without any government backing. The middleman role currently played by Fannie and Freddie would no longer exist. The government's role would be limited to the FHA and a few other smaller housing agencies, and their reach would be sharply reduced from current levels. The FHA backed 20% of all new mortgages last year. Some conservatives have called for such a private market. (II) The second option, championed by a handful of economists, would also create a mostly private market with a limited government backstop that would primarily become active buying or guaranteeing loans in periods when private lenders retreated during financial shocks. (III) The third option would create new privately owned companies to buy mortgages from banks and sell them as securities. Those securities would be explicitly guaranteed by the government as long as they meet certain criteria. The government would collect fees for that backing, just as the Federal Deposit Insurance Corp. insures bank deposits and regulates banks. These new companies would essentially replace some of the functions filled by Fannie and Freddie. An array of academics and industry groups have backed such a proposal, and senior Obama administration officials, such as Treasury Secretary Timothy Geithner, have publicly discussed its merits. According to the Journal, the housing industry greeted the proposal coolly, and some mortgage industry officials criticized the administration for not providing more detail. According to the Journal, the proposals are likely to set off a furious effort by the financial-services industry to protect generous subsidies and seek out new revenue sources. Investors haven't been willing to buy mortgages that don't have government backing primarily because there haven't been enough steps taken to overhaul the market for private-label securities, said Joshua Rosner, of investment-research firm Graham Fisher & Co. * BOND PRICING -- For Week From February 7 to 11, 2011 ------------------------------------------------------ Company Coupon Maturity Bid Price ------- ------ -------- --------- 155 E TROPICANA 8.750% 4/1/2012 4.659 ABITIBI-CONS FIN 7.875% 8/1/2009 15.125 ADVANTA CAP TR 8.990% 12/17/2026 13.000 AHERN RENTALS 9.250% 8/15/2013 57.900 AMBAC INC 5.950% 12/5/2035 11.000 AMBAC INC 6.150% 2/7/2087 1.750 AMBAC INC 7.500% 5/1/2023 10.750 AMBAC INC 9.375% 8/1/2011 19.900 AMBAC INC 9.500% 2/15/2021 13.100 AMBASSADORS INTL 3.750% 4/15/2027 38.250 AMR CORP 10.450% 3/10/2011 97.554 BANK NEW ENGLAND 8.750% 4/1/1999 11.250 BANK NEW ENGLAND 9.875% 9/15/1999 13.000 BANKUNITED FINL 3.125% 3/1/2034 5.600 BANKUNITED FINL 6.370% 5/17/2012 6.500 BLOCKBUSTER INC 9.000% 9/1/2012 2.000 BOWATER INC 6.500% 6/15/2013 31.000 CAPMARK FINL GRP 5.875% 5/10/2012 47.750 CCK-CALL02/11 7.750% 11/15/2015 103.760 CS FINANCING CO 10.000% 3/15/2012 3.000 CURAGEN CORP 4.000% 2/15/2011 99.000 DUNE ENERGY INC 10.500% 6/1/2012 72.208 EDDIE BAUER HLDG 5.250% 4/1/2014 5.000 EVERGREEN SOLAR 4.000% 7/15/2013 32.000 F-CALL02/11 5.750% 2/21/2012 99.630 FAIRPOINT COMMUN 13.125% 4/1/2018 10.375 FAIRPOINT COMMUN 13.125% 4/2/2018 14.500 FRIEDE GOLDMAN 4.500% 9/15/2004 0.950 GENERAL MOTORS 7.125% 7/15/2013 33.750 GENERAL MOTORS 9.450% 11/1/2011 31.900 GREAT ATLA & PAC 5.125% 6/15/2011 36.000 GREAT ATLA & PAC 6.750% 12/15/2012 34.550 GREAT ATLANTIC 9.125% 12/15/2011 36.000 HARRY & DAVID OP 9.000% 3/1/2013 39.000 HARTFORD LIFE GL 5.200% 2/15/2011 100.147 INDALEX HOLD 11.500% 2/1/2014 0.750 LEHMAN BROS HLDG 1.500% 3/23/2012 22.875 LEHMAN BROS HLDG 1.985% 6/29/2012 10.000 LEHMAN BROS HLDG 4.500% 8/3/2011 23.000 LEHMAN BROS HLDG 4.700% 3/6/2013 22.500 LEHMAN BROS HLDG 4.800% 2/27/2013 22.500 LEHMAN BROS HLDG 4.800% 3/13/2014 25.375 LEHMAN BROS HLDG 5.000% 1/22/2013 22.750 LEHMAN BROS HLDG 5.000% 2/11/2013 22.000 LEHMAN BROS HLDG 5.000% 3/27/2013 20.630 LEHMAN BROS HLDG 5.000% 8/3/2014 21.250 LEHMAN BROS HLDG 5.000% 8/5/2015 23.000 LEHMAN BROS HLDG 5.100% 1/28/2013 23.000 LEHMAN BROS HLDG 5.150% 2/4/2015 20.500 LEHMAN BROS HLDG 5.250% 2/6/2012 25.500 LEHMAN BROS HLDG 5.250% 2/11/2015 22.500 LEHMAN BROS HLDG 5.500% 4/4/2016 25.500 LEHMAN BROS HLDG 5.625% 1/24/2013 26.125 LEHMAN BROS HLDG 5.750% 7/18/2011 24.562 LEHMAN BROS HLDG 5.750% 5/17/2013 23.125 LEHMAN BROS HLDG 5.750% 1/3/2017 0.011 LEHMAN BROS HLDG 6.000% 7/19/2012 25.500 LEHMAN BROS HLDG 6.000% 6/26/2015 23.750 LEHMAN BROS HLDG 6.000% 12/18/2015 22.750 LEHMAN BROS HLDG 6.200% 9/26/2014 26.000 LEHMAN BROS HLDG 6.625% 1/18/2012 24.300 LEHMAN BROS HLDG 8.000% 3/5/2022 21.750 LEHMAN BROS HLDG 8.500% 8/1/2015 24.000 LEHMAN BROS HLDG 8.750% 12/21/2021 22.500 LEHMAN BROS HLDG 8.800% 3/1/2015 22.000 LEHMAN BROS HLDG 9.000% 3/7/2023 21.750 LEHMAN BROS HLDG 9.500% 12/28/2022 22.500 LEHMAN BROS HLDG 9.500% 1/30/2023 22.500 LEHMAN BROS HLDG 9.500% 2/27/2023 21.200 LEHMAN BROS HLDG 10.000% 3/13/2023 21.425 LEHMAN BROS HLDG 10.375% 5/24/2024 20.125 LEHMAN BROS HLDG 11.000% 6/22/2022 22.510 LEHMAN BROS HLDG 11.000% 3/17/2028 20.000 LEHMAN BROS HLDG 18.000% 7/14/2023 22.500 LEHMAN BROS INC 7.500% 8/1/2026 12.000 LOCAL INSIGHT 11.000% 12/1/2017 4.000 LTX-CREDENCE 3.500% 5/15/2011 91.500 MAGNA ENTERTAINM 7.250% 12/15/2009 3.000 MAJESTIC STAR 9.750% 1/15/2011 16.000 MOHEGAN TRIBAL 8.375% 7/1/2011 59.000 NEWPAGE CORP 10.000% 5/1/2012 65.250 NEWPAGE CORP 12.000% 5/1/2013 31.250 NRGY-CALL03/11 6.875% 12/15/2014 102.125 NRGY-CALL03/11 8.250% 3/1/2016 104.100 PALM HARBOR 3.250% 5/15/2024 44.000 PL-CALL03/11 5.050% 3/15/2020 94.293 PL-CALL03/11 5.150% 3/15/2020 94.765 QWEST CAP FDG 7.250% 2/15/2011 100.000 RASER TECH INC 8.000% 4/1/2013 35.000 RESTAURANT CO 10.000% 10/1/2013 35.000 RESTAURANT CO 10.000% 10/1/2013 30.375 RJ TOWER CORP 12.000% 6/1/2013 1.000 RYERSON TULL INC 8.250% 12/15/2011 65.020 SAFEGUARD SCIENT 2.625% 3/15/2024 91.554 SBARRO INC 10.375% 2/1/2015 32.000 SPHERIS INC 11.000% 12/15/2012 1.500 THORNBURG MTG 8.000% 5/15/2013 4.125 TIMES MIRROR CO 7.250% 3/1/2013 37.000 TRANS-LUX CORP 8.250% 3/1/2012 18.000 TRICO MARINE 3.000% 1/15/2027 8.792 TRICO MARINE SER 8.125% 2/1/2013 12.250 VERIZON COMM INC 5.350% 2/15/2011 100.012 VIRGIN RIVER CAS 9.000% 1/15/2012 50.000 WASH MUT BANK NV 5.500% 1/15/2013 0.010 WCI COMMUNITIES 4.000% 8/5/2023 1.302 WOLVERINE TUBE 15.000% 3/31/2012 36.000 ********* 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 ***