/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110509.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, May 9, 2011, Vol. 15, No. 127 Headlines 5 STAR: Case Summary & 13 Largest Unsecured Creditors ACHIEF PARTNERS: Voluntary Chapter 11 Case Summary ACORN ELSTON: Seeks May 13 Plan Exclusivity Extension ACORN ELSTON: Kasowitz Benson Withdraws as Debtor Counsel AIRTRAN HOLDINGS: Incurs $8.81 Million Net Loss in March 31 Qtr. AIRTRAN HOLDINGS: Kolski Resigns as EVP Operations/Corp. Affairs AIRTRAN HOLDINGS: Moody's Withdraws Caa1 Rtngs on Merger Closing ALLEN SYSTEMS: Moody's Assigns 'Ba2' Rating to Term Loans AMBAC FIN'L: To Release Quarter 2011 Results Tomorrow AMERICAS ENERGY: Hanhong to Provide $2-Mil. Line of Credit APEX DIGITAL: Obtains June 13 Plan Filing Extension APOLLO MEDICAL: Delays Filing of Annual Report ART ONE: Seeks to Employ Barlow Garsek as Bankruptcy Counsel ART ONE: Files Schedules of Assets and Liabilities ASSOCIATED BANC: S&P Raises CCR From 'BB-'; Outlook Stable ASSOCIATED ESTATES: Moody's Upgrades Debt Shelf Rating to (P)Ba1 ATLANTIC MUTUAL: Titanic Insurer Placed in Liquidation BANKATLANTIC BANCORP: Plans to Offer $30MM Class A Common Stock BEAZER HOMES: Incurs $54.57 Million Net Loss in March 31 Quarter BERKLINE/BENCHCRAFT: Wins Interim Access to Cash Collateral BERNARD L. MADOFF: Suit vs. JPM Belongs in District Court BERNARD L. MADOFF: HSBC Seeks Dismissal of Trustee Lawsuit BONDS.COM GROUP: Incurs $12.51 Million Net Loss in 2010 C&D TECHNOLOGIES: Incurs $55.55 Million Net Loss in Fiscal 2011 CABI SMA: Amends Chapter 11 Reorganization Plan CARESTREAM HEALTH: Bank Debt Trades at 5% Off in Secondary Market CARIBE MEDIA: Bankruptcy Cues Moody's to Slash CFR to 'Ca' CASCADE BANCORP: Five Proposals Approved at Annual Meeting CELANESE CORP: Moody's Assigns 'Ba3' Rating to New Unsecured Notes CELL THERAPEUTICS: Retires 7.5% Convertible Senior Notes CELL THERAPEUTICS: Investors Buy $16MM of Pref. Stock & Warrants CELL THERAPEUTICS: Issues 912,686 Warrants to Rodman & Renshaw CELL THERAPEUTICS: Receives NASDAQ Notice of Non-Compliance CHARTER COMMS: S&P Keeps 'BB-' Rating on Unsecured Notes CHARTER COMMS: Moody's Rates Proposed $1BB Sr. Unsec. Notes 'B1' CLAIRE'S STORES: Bank Debt Trades at 6% Off in Secondary Market CLEAN BURN: Can Return Liquid Yeast to LET in Exchange for $8,000 COASTAL BANK: Closed; Premier American Bank NA Assumes Deposits COASTAL TECHNOLOGIES: Case Summary & Largest Unsecured Creditor COLONIAL BANCGROUP: Creditors Object to FDIC's Ch 7.Bid COLTS RUN: Hearing on Cash Collateral Use Request Set for July 20 COLUMBUS COUNTRY: Case Summary & 12 Largest Unsecured Creditors COMPOSITE TECH: Has Until Today to File Schedules and Statements CONAGRA FOODS: Moody's Reviews Preferred Shelf '(P)Ba1' Rating COUNTRYVIEW MHC: Disclosure Statement Hearing Set for May 24 CYBEX INTERNATIONAL: Files Q1 Form 10-Q; Posts $379,000 Net Income CYBEX INTERNATIONAL: Files Form 10-Q; Posts $379,000 Net Income DENNY'S CORPORATION: Reports $4.12MM Net Income in March 30 Qtr. DEX MEDIA EAST: Bank Debt Trades at 20% Off in Secondary Market DOT VN: Vietnamese IDN Registrations Exceed 101,000 DS WATERS: S&P Lowers CCR to 'CCC+'; Outlook Developing EAGLE BRIDGE: Case Summary & 20 Largest Unsecured Creditors EARTHLINK INC: S&P Gives 'B' Rating on Corporate Credit ENERGY FUTURE: Posts $362-Million 1st Quarter Net Loss EPICOR SOFTWARE: Moody's Attaches 'B2' CFR to Proposed Buyout ESTERLINE TECHNOLOGIES: Moody's Says 'Ba2' CFR Unaffected ESTERLINE TECHNOLOGIES: S&P Affirms 'BB+' Corporate Credit Rating FENTURA FINANCIAL: Amends SERP Agreement with D. Wollschlager FIRST FEDERAL: Incurs $1.51 Million Net Loss in March 31 Qtr. FRONT LINE: Voluntary Chapter 11 Case Summary GENOIL INC: Posts $5.6 Million Net Loss in 2010 GLOBAL CROSSING: Incurs $33 Million Net Loss in March 31 Qtr. GREEN MOUNTAIN: S&P Places 'B' Corp. Credit Rating on Watch Pos. GRUBB & ELLIS: Stonerise Capital Discloses 2.2% Equity Stake GUITAR CENTER: Bank Debt Trades at 4% Off in Secondary Market GULFSTREAM INT'L: Asks for Insurance Funds to Defend Lawsuit GUNDLE/SLT ENVIRONMENTAL: Moody's Upgrades CFR to B3 GUNDLE/SLT ENVIRONMENTAL: S&P Raises Corp. Credit Rating to 'B-' HAMPTON ROADS: To Effect a 1-for-25 Reverse Stock Split HERCULES OFFSHORE: Files Form 10-Q; Posts $14.2-Mil. Net Loss HERCULES OFFSHORE: Bank Debt Trades at 1% Off in Secondary Market HIGHVIEW POINT: Files for Chapter 11 Protection HIGHVIEW POINT: Case Summary & 13 Largest Unsecured Creditors HOST HOTELS: S&P Gives 'BB+' Rating on $350MM Sr. Notes HOUSE OF PRAYER: Voluntary Chapter 11 Case Summary HOWREY LLP: Wants Bankruptcy in DC, Not California HSRE-CDS I: GB HoldCo Seeks Dismissal of Chapter 11 Proceeding HSRE-CDS I: Section 341 Meeting of Creditors Set for May 10 HSRE-CDS I: Files Schedules of Assets and Liabilities INTEGRA BANK: Judge Trockman Resigns from Board of Directors INTERPUBLIC GROUP: Fitch Affirms Preferred Stock at 'BB+' ISLAND ONE: Wins Confirmation of Reorganization Plan KANSAS CITY SOUTHERN: Moody's Hikes CFR to 'B1' on Revenue Growth KT SPEARS: Voluntary Chapter 11 Case Summary LABELCORP HOLDINGS: $100MM 2nd Lien Facility Gets Moody's 'Caa1' LAM RESEARCH: S&P Rates $800MM Sr. Unsecured Notes 'BB+' LEE ENTERPRISES: Incurs $1.45 Million Net Loss in March 27 Qtr. LEE ENTERPRISES: Withdraws Offerings of Sr. Notes & Common Stock LEVEL 3: Incurs $205 Million Net Loss in March 31 Quarter LIMITED BRANDS: Moody's Says Repurchase Program Won't Affect 'Ba1' LITHIUM TECHNOLOGY: Appoints Martin Koster as President and COO LK LAND: Case Summary & 2 Largest Unsecured Creditors LNR PROPERTY: Moody's Raises CFR to 'Ba2' on Bank Debt Refinancing LOOP CORP: Sec. 341 Creditors' Meeting Set for June 7 LOS GATOS HOTEL: Plan Filing Exclusivity Extended to July 25 MANITOWOC COMPANY: Moody's Affirms B2 CFR; Credit Facility at Ba2 MASTEC INC: Moody's Affirms Ba3 Corporate Family Rating MEREULO MADDUX: Files Fourth Amended Joint Chapter 11 Plan METALDYNE LLC: Moody's Affirms 'B1' CFR on Plan to Upsize Loan METALDYNE LLC: S&P Rates 'B+' $355MM Term Loan, Affirms 'B+' CCR MICHAEL DAVIS: Appeal Over Seizure of Exempt Assets to Continue MILAGRO OIL: Moody's Rates Notes 'Caa2'; Outlook Negative MOLECULAR INSIGHT: Deregisters Unissued Shares Under Stock Plans MOLECULAR INSIGHT: Withdraws COM Purchase Rights from Nasdaq MOLECULAR INSIGHT: Court Confirms Reorganization Plan MONTPELIER RE: S&P Gives 'BB+' Rating on $150MM Preferred Stock MOOD MEDIA: Moody's Upgrades First Lien Loan to 'Ba3' From 'Ba1' MORGANS HOTEL: Incurs $32.86 Million Net Loss in March 31 Quarter MOVIE GALLERY: Settles Debt Collection Suit With 50 States MUMTAZ HANNA GEORGE: Court Wants Plan Documents Amended NALCO COMPANY: Fitch Affirms Issuer Default Rating at 'B+' NELSON INC: Case Summary & 20 Largest Unsecured Creditors NEUROLOGIX INC: Enters Into Letter Agreement with M. Kaplitt NEW YORK SPOT: Case Summary & 3 Largest Unsecured Creditors NPS PHARMACEUTICALS: Incurs $9.15-Mil. Net Loss in March 31 Qtr. OLDE PRAIRIE: Can Borrow Funds to Pay Portion of JMB Expenses PACIFIC INTERESTS: Voluntary Chapter 11 Case Summary PACIFIC RUBIALES: Moody's Assigns First Time 'Ba3' CFR PARLAY ENTERTAINMENT: Taps BDO Canada to Assist in Restructuring PATIO MARKET: Voluntary Chapter 11 Case Summary PATRIOT COAL: S&P Affirms 'B+' CCR; Outlook Negative PECAN SQUARE: Files Schedules of Assets and Liabilities PINE MOUNTAIN: Court Converts Case to One Under Chapter 7 PEREGRINE DEVELOPMENT: Case Summary & 3 Largest Unsec. Creditors PONTIAC CITY: Moody's Cuts Rtng to 'Caa1' Over June Default Risk PQ CORP: S&P Affirms 'B' CCR; Outlook Revised to Stable RADIENT PHARMACEUTICALS: Presented at Aegis Capital Conference RASER TECHNOLOGIES: Files Copy of Plan Support Agreement REALOGY CORP: Bank Debt Trades at 4% Off in Secondary Market REVLON CONSUMER: Meets with Lenders on Possible Refinancing REVLON INC: RCPC Meets with Lenders for Possible Debt Refinancing ROBB & STUCKY: Cooley LLP Approved as Committee Lead Counsel ROBB & STUCKY: Committee Retains Broad & Cassel as Local Counsel ROBB & STUCKY: Committee Retains BDO USA as Financial Advisor ROCKWOOD SPECIALTIES: Fitch Affirms Issuer Default Rating at 'BB' ROOKWOOD CORPORATION: Involuntary Chapter 11 Case Summary ROOSEVELT AVENUE: Case Summary & 13 Largest Unsecured Creditors RSM RESIDENTIAL: Taps Schwartzer & McPherson as Bankr. Counsel SCOTSMAN INDUSTRIES: Moody's Assigns B1 to $60MM Incremental Loan SCOTSMAN INDUSTRIES: S&P Retains 'B+' Rating on Upsized Term Loan SEAGATE TECHNOLOGY: Fitch Affirms Issuer Default Rating at 'BB+' SEAGATE HDD: S&P Rates $600MM Sr. Unsecured Notes 'BB+' SELECT MEDICAL: Moody's Assigns B1 to Sr. Secured Credit Loan SELECTIVE INVESTMENTS: Case Summary & 10 Largest Unsec. Creditors SENSATA TECHNOLOGIES: S&P Rates $1.45Bln. Credit Facility 'BB+' SENSATA TECHNOLOGIES: To Refinance All Existing Indebtedness SHEA HOMES: Moody's Assigns 'B2' Corporate Family Rating SHIPPERS' CHOICE: Settlement Talks With CDS Continue SIRIUS XM: Reports $78.12 Million Net Income in March 31 Qtr. SKYE INTERNATIONAL: Files Chapter 7 Petition SPENCER SPIRIT: S&P Rates Corp. Credit & Sr. Unsecured Notes 'B' SPRING WINDOW: Moody's Rates $35MM 1st Lien Credit Facility 'B1' STAFFORD COUNTY: Moody's Affirms GO Bond Rating at 'Ba2' STILLWATER MINING: Reports $36.19MM Net Income in March 31 Qtr. SUMMIT BUSINESS: Court Approves Reorganization Plan SW BOSTON: Court Won't Allow Rival Plan At This Time T3 MOTION: Files Form 8-A; Registers Common Stock with SEC TARGUS GROUP: S&P Rates Corp. Credit 'B'; Outlook is Stable TASC INC: Moody's Assigns Ba2 Rating to New $675MM Bank Facility TELIGENT INC: 2nd Circ. Clears K&L to Fight Teligent Deal TENET HEALTHCARE: CHS Hikes Offer for Shares to $7.25 Apiece TENET HEALTHCARE: Reports $82-Mil. Net Income in March 31 Qtr. TERRA-GEN FINANCE: S&P Gives 'BB-' Rating on Corporate Credit TERRESTAR CORP: Court Sets General Bar Date at May 13 TIB FINANCIAL: TIB Bank Merges with NAFH National Bank TIMOTHY BLIXSETH: Montana Opposes Case Dismissal TRADE UNION: Court Authorizes Interim Use of Cash Collateral TRANS ENERGY: Lisa Corbitt Resigns as Chief Accounting Officer TRIMAS CORP: Moody's Upgrades CFR to 'B1' on Better Credit Metrics TWIN RIVER: Debt Refinancing Plan Cues Moody's 'B2' Rating Review TWO BROTHERS: Voluntary Chapter 11 Case Summary TXU CORP: Bank Debt Trades at 13% Off in Secondary Market ULTIMATE ESCAPES: Seeks July 18 Plan Exclusivity Extension UNISYS CORP: Has Form 10-Q; Posts $39.4MM Loss in March 31 Qtr. UNIT CORP: Fitch Initiates Coverage With 'BB' IDR UNIT CORP: Moody's Assigns B3 Sr. Subordinated Notes Rating UNIT CORP: Fitch Initiates Coverage with 'BB' IDR U.S. EAGLE: Wins Approval to Employ Tobin & Reyes as Local Counsel U.S. EAGLE: Seeks Approval to Employ Three Twenty One as Agent U.S. EAGLE: Seeks Sept. 2 Plan Exclusivity Extension U.S. EAGLE: Wants Lease Assumption Deadline Moved to Aug. 4 U.S. FOODSERVICE: $400MM Sr. Unsec. Notes Get Moody's Caa2 Rating USEC INC: First Amendment to 2009 Equity Incentive Plan Approved USEC INC: Incurs $16.6 Million Net Loss in March 31 Quarter USG CORP: Dismissal of Writ of Mandate Proceeding Reversed VILLASENOR INC: Case Summary & 16 Largest Unsecured Creditors VINCENZA LEONELLI-SPINA: 3rd Cir. Affirms Non-Dischargeability VITRO SAB: Says Ch. 15 Should Stay in NY as Texas Judge Ill VITRO SAB: Committee Looking for Higher Offer for U.S. Units VITRO SAB: Proposes Bonus Program for Top Managers WASHINGTON STATE HOUSING: S&P Raises Revenue Bonds From 'BB/B' WILLOW GLEN: Case Summary & 2 Largest Unsecured Creditors WORLDWORKS DEVELOPMENT: Case Summary & 4 Largest Unsec Creditors XERIUM TECHNOLOGIES: Moody's Upgrades CFR to 'B2' from 'B3' XERIUM TECHNOLOGIES: S&P Affirms 'B' CCR; Outlook Stable YRC WORLDWIDE: Fitch Cuts IDR to 'C'; Bankruptcy Remains Likely YRC WORLDWIDE: CEO & CFO to Step Down After Restructuring * Coastal Bank's Closing Is 40th This Year * April Bankruptcies Pull Back From March Increase * S&P's Global Corporate Defaults Tally Has Five in 1st Quarter * BOND PRICING -- For Week From May 2 to 6, 2011 ********* 5 STAR: Case Summary & 13 Largest Unsecured Creditors ----------------------------------------------------- Debtor: 5 Star, Inc. Rodeway Inn of Nampa 130 Shannon Drive Nampa, ID 83687 Bankruptcy Case No.: 11-01343 Chapter 11 Petition Date: May 4, 2011 Court: U.S. Bankruptcy Court District of Idaho (Boise) Judge: Jim D. Pappas Debtor's Counsel: Howard R. Foley, Esq. FOLEY FREEMAN, PLLC P.O. Box 10 Meridian, ID 83680 Tel: (208) 888-9111 E-mail: hrfoley@foleyfreeman.com - and - Mark S. Freeman, Esq. FOLEY FREEMAN, PLLC 77 E. Idaho, Suite 100 Meridian, ID 83680 Tel: (208) 888-9111 E-mail: mfreeman@foleyfreeman.com - and - Matthew K. Shriver, Esq. FOLEY FREEMAN, PLLC 77 E. Idaho Street, Suite 100 Meridian, ID 83680 Tel: (208) 888-9111 E-mail: mshriver@foleyfreeman.com - and - Patrick John Geile, Esq. FOLEY FREEMAN, PLLC P.O. Box 10 Meridian, ID 83680 Tel: (208) 888-9111 Fax: (208) 888-5130 E-mail: pgeile@foleyfreeman.com - and - Timothy S. Callender, Esq. FOLEY FREEMAN, PLLC P.O. Box 10 Meridian, ID 83680 Tel: (208) 888-9111 E-mail: tcallender@foleyfreeman.com Scheduled Assets: $1,953,511 Scheduled Debts: $2,739,894 A list of the Company's 13 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/idb11-01343.pdf The petition was signed by Subhash C. Banga aka Jhon Bang, president. ACHIEF PARTNERS: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Achief Partners, L.P. P.O. Box 867536 Plano, TX 75086 Bankruptcy Case No.: 11-33059 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Barbara J. Houser Debtor's Counsel: Vickie L. Driver, Esq. COFFIN & DRIVER, PLLC 7557 Rambler Rd., Suite 110 Dallas, TX 75231 Tel: (214) 377-4848 Fax: (214) 377-4858 E-mail: vdriver@coffindriverlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Angela N. Li, managing member of GoBo, LLC, Debtor's general partner. ACORN ELSTON: Seeks May 13 Plan Exclusivity Extension ----------------------------------------------------- Acorn Elston LLC filed a second exclusivity motion on Feb. 28, 2011, seeking to extend the exclusive Chapter 11 plan filing deadline from March 10 to April 11, 2011 and the exclusive solicitation period from May 9 to June 10, 2011. The Debtor also asked the U.S. Bankruptcy Court for the Southern District of New York to enter a bridge order briefly extending the Exclusive Periods pending entry of an order disposing the Second Exclusivity Motion, which was set for hearing on March 17, 2011. The Court subsequently entered the Bridge Order. On March 16, 2011, the Court postponed the March 17 hearing to April 8, 2011. Accordingly, the Bridge Order extends the Exclusive Filing Period until April 8, which is three days shy of the original sought extension. The Debtor later amended the Second Exclusivity Motion by changing the date of the sought extension of the Exclusive Filing Period to May 13, 2011 and the Exclusive Solicitation Period to July 11, 2011. 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. On May 15, 2009, a court appointed C. Michelle Panovich as receiver with respect to lender Road Bay Investments, LLC's collateral. The Company filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-14807) on Sept. 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. ACORN ELSTON: Kasowitz Benson Withdraws as Debtor Counsel --------------------------------------------------------- Kasowitz Benson Torres & Friedman has withdrawn as the counsel of Acorn Elston LLC in its bankruptcy proceeding. The withdrawal was authorized by the U.S. Bankruptcy Court for the Southern District of New York in an order dated April 8, 2011. 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. On May 15, 2009, a court appointed C. Michelle Panovich as receiver with respect to lender Road Bay Investments, LLC's collateral. The Company filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-14807) on Sept. 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. AIRTRAN HOLDINGS: Incurs $8.81 Million Net Loss in March 31 Qtr. ---------------------------------------------------------------- Airtran Holdings, Inc., reported a net loss of $8.81 million on $667.03 million of total operating revenues for the three months ended March 31, 2011, compared with a net loss of $12.02 million on $605.14 million of total operating revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $2.31 billion in total assets, $1.78 billion in total liabilities and $534.72 million in total stockholders' equity. A full-text copy of the quarterly report on Form 10-Q is available for free at http://is.gd/uKts7X About AirTran Holdings Headquartered in Orlando Florida, AirTran Holdings Inc. (NYSE: AAI) -- http://www.airtran.com/-- through its wholly owned subsidiary, AirTran Airways, Inc., operates scheduled airline service throughout the United States and to selected international locations. * * * In May 2011, Standard & Poor's Ratings Services raised its corporate credit rating on AirTran Holdings Inc. (AirTran) to 'BBB-' from 'B-' and raised its senior unsecured debt rating to 'BBB-' from 'CCC'. "We removed the ratings from CreditWatch, where we placed them with positive implications on Sept. 27, 2010, when Southwest and AirTran announced a merger agreement. We are withdrawing our '6' recovery rating on AirTran's senior unsecured debt, because we do not assign recovery ratings to investment-grade companies," S&P stated. AirTran's ratings now reflect the consolidated credit quality of its parent company, Southwest Airlines Co. The rating outlook reflects Southwest's rating outlook, which is stable. * * * This concludes the Troubled Company Reporter's coverage of AirTran until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. AIRTRAN HOLDINGS: Kolski Resigns as EVP Operations/Corp. Affairs ---------------------------------------------------------------- In connection with his scheduled retirement, Stephen J. Kolski, resigned from his position as Executive Vice President-Operations and Corporate Affairs of AirTran Holdings, Inc., and its subsidiary AirTran Airways, Inc. Mr. Kolski's retirement from this position with the Company and Airways was prearranged. About AirTran Holdings Headquartered in Orlando Florida, AirTran Holdings Inc. (NYSE: AAI) -- http://www.airtran.com/-- through its wholly owned subsidiary, AirTran Airways, Inc., operates scheduled airline service throughout the United States and to selected international locations. The Company's balance sheet at March 31, 2011 showed $2.31 billion in total assets, $1.78 billion in total liabilities and $534.72 million in total stockholders' equity. * * * In May 2011, Standard & Poor's Ratings Services raised its corporate credit rating on AirTran Holdings Inc. (AirTran) to 'BBB-' from 'B-' and raised its senior unsecured debt rating to 'BBB-' from 'CCC'. "We removed the ratings from CreditWatch, where we placed them with positive implications on Sept. 27, 2010, when Southwest and AirTran announced a merger agreement. We are withdrawing our '6' recovery rating on AirTran's senior unsecured debt, because we do not assign recovery ratings to investment-grade companies," S&P stated. AirTran's ratings now reflect the consolidated credit quality of its parent company, Southwest Airlines Co. The rating outlook reflects Southwest's rating outlook, which is stable. * * * This concludes the Troubled Company Reporter's coverage of AirTran until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. AIRTRAN HOLDINGS: Moody's Withdraws Caa1 Rtngs on Merger Closing ---------------------------------------------------------------- Moody's Investors Service raised its rating on the $5.472 million of 7% convertible notes due 2023 of Southwest Airlines Co. to Baa3 from Caa3. The upgrade reflects the assumption of the obligation by Southwest (Baa3, stable outlook) upon the consummation of the merger with AirTran Holdings, Inc. (now AirTran Holdings, LLC or "AirTran") on May 2, 2011. Moody's withdrew the Caa1 Corporate Family, Caa1 Probability of Default and the SGL-3 Speculative Grade Liquidity ratings of AirTran as it has become a wholly-owned subsidiary of Southwest. Upgrades: Issuer: AirTran Airways, Inc. -- Senior Secured Enhanced Equipment Trust, Pass-Thru Certificates A Tranche, Upgraded to Ba2 from B1 -- Senior Secured Enhanced Equipment Trust, Pass-Thru Certificates B Tranche, Upgraded to B2 from Caa1 -- Senior Secured Enhanced Equipment Trust, Pass-Thru Certificates C Tranche, Upgraded to B3 from Caa2 Issuer: AirTran Holdings, LLC -- Senior Unsecured Conv./Exch. Bond/Debenture, Upgraded to Baa3 from Caa3 Withdrawals: Issuer: AirTran Holdings, LLC -- Probability of Default Rating, Withdrawn, previously rated Caa1 -- Speculative Grade Liquidity Rating, Withdrawn, previously rated SGL-3 -- Corporate Family Rating, Withdrawn, previously rated Caa1 RATINGS RATIONALE Moody's also upgraded its ratings on AirTran Airways Inc.'s Series 1999-1 Enhanced Equipment Trust Certificates: Class A to Ba2 from B1, Class B to B2 from Caa1 and Class C to B3 from Caa2. The upgrade of the ratings of the Certificates reflects the credit benefits of AirTran becoming a subsidiary of Southwest. These ratings remain on review for further upgrade since Southwest has yet to disclose whether it will replace AirTran as the guarantor of the aircraft lease obligations of AirTran Airways that underlie the Certificates. Should Southwest assume AirTran's guarantee, the ratings on the certificates could be further upgraded. If AirTran remains the guarantor of the aircraft lease obligations, maintaining the ratings would be subject to the provision to Moody's of financial reporting for the AirTran subsidiary. On May 4, 2011, Southwest called for redemption the Notes pursuant to the Fundamental Change provision of the Notes' indenture. Moody's will withdraw the Baa3 rating on the Notes upon their payoff. The principal methodology used in rating Southwest was the Global Passenger Airlines Industry Methodology, published March 2009. Southwest Airlines is the United State's largest carrier in terms of originating domestic passengers boarded, now serving 72 cities in 37 states with the addition of service to Newark Liberty International Airport on March 27, 2011. Based in Dallas, Texas, Southwest currently operates more than 3,400 flights a day. AirTran Airways is a wholly owned subsidiary of Southwest Airlines Co. AirTran offers coast-to-coast, two-class service on North America's newest all-Boeing fleet. ALLEN SYSTEMS: Moody's Assigns 'Ba2' Rating to Term Loans --------------------------------------------------------- Moody's Investors Service affirmed Allen Systems Group, Inc.'s B2 Corporate Family Rating with a stable ratings outlook and assigned a Ba2 rating to the Company's $115 million of term loan B incremental credit facility. ASG's other existing debt instrument ratings were affirmed. The Company plans to use the net proceeds from the incremental credit facility to fund the purchase price for visionapp AG's acquisition. These ratings were assigned: Issuer -- Allen Systems Group, Inc. -- $115 million incremental term loan B due 2015 -- Ba2, (LGD 16%) These ratings were affirmed: Issuer -- Allen Systems Group, Inc. -- Corporate Family Rating -- B2 -- Probability of Default Rating -- B2 -- $25 million senior 1st lien secured revolving credit facility due 2015 -- Ba2, (LGD2 -- 16%), LGD assessment revised from LGD1, 7% -- $78 million ($80 million originally) senior 1st lien secured term loan due 2015 -- Ba2, (LGD2 -- 16%), LGD assessment revised from LGD1, 7% -- $300 million senior 2nd lien secured notes due 2016 -- B3, (LGD5, 71%), LGD assessment revised from LGD4, 61% Outlook -- Stable RATINGS RATIONALE The proposed acquisition of visionapp will extend ASG's existing enterprise information technology (IT) management software suite to include a cloud computing solutions offering which enables the roll-out of cloud computing services for enterprise customers. Although these acquisitions expand the Company's market opportunities, and there is potential to cross-sell into the customer base of the combined companies, the debt-financed acquisitions materially weaken the Company's credit metrics, notably as Debt-to-EBITDA leverage increases from 4.9x to about 5.9x, excluding any acquisition synergies. Additionally, visionapp does not have a track record of positive cash flow generation. Nonetheless, Moody's views the acquisitions as consistent with the Company's history of augmenting and strengthening its product portfolio through acquisitions. The affirmation of the B2 CFR reflects Moody's expectations that ASG will be able revive revenue growth from its legacy products and that it will achieve approximately $18 million of targeted annual cost savings such that Debt-to-EBITDA leverage will be restored to less than 5.0x over the next twelve months. The execution risks of achieving synergies are somewhat tempered by ASG's history of combining companies and achieving synergies from its key acquisitions. ASG's CFR is weakly positioned in the B2 rating category, which is characterized by the Company's aggressive financial policies and acquisitive growth strategy. The B2 CFR reflects Moody's expectations that ASG will maintain moderate financial risk profile, including Debt-to-EBITDA leverage of between 4.0x-to- 5.0x, and that free cash flow (Cash from operations less capital expenditures and dividends) will increase to about 3%-to-4% of its total debt. The B2 rating considers ASG's small scale relative to its larger and better capitalized competitors, and its highly competitive operating environment. The Company primarily competes with large-scale technology vendors such as IBM (rated Aa3), HP (rated A2), CA (rated Baa2), and BMC Software (rated Baa2) as well as several independent niche software providers. The rating is supported by ASG's broad portfolio of well-regarded mainframe and distributed enterprise management software products and its recurring maintenance revenues (63% of total revenues) and high contract renewal rates, which provide good revenue and cash flow visibility. The rating also benefits from the Company's diverse customer base of about 3,200 customers across various industries and good geographic diversity of revenues. The stable ratings outlook reflects Moody's expectations that the Company will realize synergies from the recent acquisitions in a timely manner such that Debt-to-EBITDA leverage will reduce to less than 5.0x over the next 12 months. The outlook incorporates expectations of improving free cash flow generation through revenue growth rates of mid- to high single digits, consistent with the growth rates in the software industry segments in which ASG operates. Moody's could downgrade ASG's ratings if leverage could not be sustained below 5.0x as a result of underperformance relative to expectations or delays in realizing the anticipated synergies. Downward rating pressure could develop if revenue and EBITDA growth does not materialize and free cash flow remains negative as a result of increasing competitive pressures or erosion in market share. Given ASG's elevated financial risk profile, Moody's does not anticipate an upward rating movement in the near term. Nonetheless, in the longer term Moody's could raise ASG's ratings if the Company could sustain Debt-to-EBITDA (Moody's adjusted) below 3.0x and generate free cash flow in excess of 10% of its total debt through revenue and EBITDA growth. The last rating action for ASG was on Nov. 5, 2010. The principal methodology used in rating Allen Systems Group, Inc. was the Global Software Industry Methodology, published May 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Headquartered in Naples, Florida, ASG is a privately-held provider of enterprise management software solutions used by IT departments of enterprise customers to automate tasks, manage content, and monitor performance of their infrastructure across mainframe and distributed computing environments. The Company generated annual revenues of approximately $263 million in 2010. AMBAC FIN'L: To Release Quarter 2011 Results Tomorrow ----------------------------------------------------- Ambac Financial Group, Inc. it will release its first quarter 2011 results on May 10, 2011, after the market close. Management will not host a conference call to discuss the first quarter results. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor- in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed $30.05 billion in total assets, $31.47 billion in total liabilities, and a $1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of ($394.5 million) and total liabilities of $1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about $1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's bankruptcy counsel. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. AMERICAS ENERGY: Hanhong to Provide $2-Mil. Line of Credit ---------------------------------------------------------- Americas Energy Company announced that Hanhong New Energy Holdings, a subsidiary of Hanhong Private Equity Management Company Limited, with its Corporate Headquarters in Beijing, China, has agreed to provide a Line of Credit for the expansion of Americas Energy's Artemus Project and Highway 72 Deep Mine Projects in Southeast Kentucky. "The $2 Million dollar line of credit Hanhong is providing will allow AENY to bring two of our four permitted deep mines online. AENY plans to initiate deep mine operations in the Jellico Coal Seam on our Artemus Property in May. Once production stabilizes in the Jellico seam we will follow on with deep mine operations in the Darby seam on our Hwy 72 property. AENY estimates production of approximately 20,000 tons of clean coal per month from each of these mines by the end of our 3rd Quarter," said Chris Headrick, President and CEO of Americas Energy Company. Mr. Headrick added, "The Hanhong team also brings strong international logistic and strategic ties that will further assist AENY in its overall expansion program. To that end we have just finalized more than six months of due diligence on a Metallurgical property with more than 9 million tons of Permitted Metallurgical Reserves in Alabama. We have agreed on terms for acquisition funding of up to $25 Million dollars from Hanhong and plan to submit an offer for the project the first week of May." A full-text copy of the Investment Agreement is available for free at http://is.gd/euhbFb About Americas Energy Knoxville, Tenn.-based Americas Energy Company-AECo currently operates surface mines in southeastern Kentucky. In March 2010, the Company acquired Evans Coal Corp. for $7,000,000 in cash, a $25,000,000 promissory note and a 2% overriding royalty on all coal sales generated from the properties acquired from Evans. Evans owns or controls by lease mineral rights and currently operates by use of contractors, two surface mines in Bell County and one in Knox County, Kentucky. In addition, the Company has rights to oil properties located in Cumberland County, Kentucky that are intended for future development. The Company's balance sheet as of Dec. 31, 2010, showed $26.0 million in total assets, $6.0 million in total liabilities, and stockholders' equity of $20.0 million. Weaver & Martin, LLC, in Kansas City, Mo., expressed substantial doubt about Americas Energy's ability to continue as a going concern, following the Company's results for the period from July 13, 2009 (inception), through March 31, 2010. The independent auditors noted that the Company has suffered recurring losses and had negative cash flows from operations. APEX DIGITAL: Obtains June 13 Plan Filing Extension --------------------------------------------------- Apex Digital, Inc., sought and obtained from the U.S. Bankruptcy Court for the Central District of California an extension of the exclusive Chapter 11 plan filing period from March 15, 2011 to June 13, 2011 and the exclusive period to solicit acceptances of a plan from May 14, 2011 to Aug. 12, 2011. 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. APOLLO MEDICAL: Delays Filing of Annual Report ---------------------------------------------- Apollo Medical Holdings, Inc., notified the U.S. Securities and Exchange Commission that the compilation, dissemination and review of the information required to be presented in the Form 10-K for the period ended Jan. 31, 2011, has imposed time constraints that have rendered timely filing of the Form 10-K impracticable without undue hardship and expense to the Company. The Company expects to file such report no later than 15 calendar days after its original prescribed due date. About Apollo Medical Glendale, Calif.-based Apollo Medical Holdings, Inc., provides hospitalist services in the Greater Los Angeles, California area. Hospitalist medicine is organized around the admission and care of patients in an inpatient facility such as a hospital or skilled nursing facility and is focused on providing, managing and coordinating the care of hospitalized patients. The Company's balance sheet at Oct. 31, 2010, showed $1.29 million in total assets, $1.39 million in total liabilities, and a stockholders' deficit of S101,002. As reported in the Troubled Company Reporter on June 2, 2010, Kabani & Company, Inc., in Los Angeles, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended Jan. 31, 2010. The independent auditors noted that the Company has an accumulated deficit of $1.24 million as of Jan. 31, 2010, working capital of $1.07 million and cash flows used in operating activities of $338,141. ART ONE: Seeks to Employ Barlow Garsek as Bankruptcy Counsel ------------------------------------------------------------ ART One Hickory Corporation asks the U.S. Bankruptcy Court for the Northern District of Texas for authority to employ Barlow Garsek & Simon LLP as bankruptcy counsel. Barlow Garsek's services as bankruptcy counsel are: a. BGS will advise and consult with the Debtor concerning (i) legal questions arising in administering and reorganizing the Debtor's estate, and (ii) the Debtor's rights and remedies in connection with the estate's assets and creditors' claims; b. BGS will provide legal services to the Debtor relating to the sale of assets, outside the ordinary course of business, if necessary; c. BGS will assist the Debtor in obtaining confirmation and consummation of the Plan; d. BGS will assist the Debtor in preserving and protecting property of the Debtor's estate, including the negotiation of cash collateral agreements, the defense of motions for relief from the automatic stay, and the prosecution of litigation, if any; e. BGS will, as appropriate, investigate and prosecute preference, fraudulent transfer, and other actions arising under the Debtor's avoidance powers and any causes of action arising under state law; f. BGS will prepare any pleadings, motions, answers, notices, orders and reports that are required for the orderly administration of the Debtor's estate; and g. BGS will perform any and all other legal services for the Debtor that the Debtor determines to be necessary and appropriate to faithfully discharge its duties as a debtor- in-possession. The customary and proposed hourly rates to be charged by Barlow Garsek for the individuals expected to be directly involved in representing the Debtor are: Henry W. Simon $400 Robert A. Simon $350 Spencer D. Solomon $225 The Debtor will also reimburse Barlow Garsek for its necessary out-of-pocket expenses. Robert A. Simon, Esq., a member at Barlow Garsek, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About ART One Fort Worth, Texas-based ART One Hickory Corporation, aka ART Two Hickory Corporation owns two four-story office buildings in North Dallas, Texas. The first is located at 1800 Valley View Lane, Dallas, Texas 75234, and is approximately 102,612 square feet. The second is located at 1750 Valley View Lane, Dallas, Texas 75234, and is approximately 96,124 square feet. ART One filed for Chapter 11 bankruptcy protection on April 4, 2011 (Bankr. N.D. Tex. Case No. 11-42024). Robert A. Simon, Esq., at Barlow Garsek & Simon, LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. ART ONE: Files Schedules of Assets and Liabilities -------------------------------------------------- ART One Hickory Corporation filed with the U.S. Bankruptcy Court for the Northern District of Texas, its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $22,000,000 B. Personal Property $2,770,573 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $18,027,362 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $1,531,343 ----------- ----------- TOTAL $24,770,573 $19,558,705 About ART One Fort Worth, Texas-based ART One Hickory Corporation, aka ART Two Hickory Corporation owns two four-story office buildings in North Dallas, Texas. The first is located at 1800 Valley View Lane, Dallas, Texas 75234, and is approximately 102,612 square feet. The second is located at 1750 Valley View Lane, Dallas, Texas 75234, and is approximately 96,124 square feet. ART One filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 11-42024) on April 4, 2011. Robert A. Simon, Esq., at Barlow Garsek & Simon, LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. ASSOCIATED BANC: S&P Raises CCR From 'BB-'; Outlook Stable ---------------------------------------------------------- Standard & Poor's Ratings Services raised its long-term counterparty credit ratings on Associated Banc Corp. to 'BBB-' from 'BB-', and on banking subsidiary Associated Bank N.A. to 'BBB' from 'BB+'. The outlook is stable. "The upgrade reflects our view that ASBC's improved balance sheet and profitability are representative of an investment-grade rating," said Standard & Poor's credit analyst Sunsierre Newsome. First-quarter results showed continued improvement in credit quality along with significant declines in loan-loss provisioning and nonperforming assets (NPAs) since last year, resulting in first-quarter profitability. This quarter marks the third consecutive net profit. "We believe that management has demonstrated an improvement of its asset quality and profitability metrics sufficient to warrant a return to investment-grade ratings," Ms. Sunsierre added. "ASBC's strong capital also helps to support the rating." "The stable outlook reflects our belief that credit costs will subside and that asset quality measures will return toward more normal historical levels for the company, improving profitability," S&P said. "However, if credit costs remain high, pressuring earnings and eroding tangible capital, we could revise the outlook to negative," S&P noted. "We believe the company is fully rated at its current level, given economic conditions and uncertainty as to future regulatory requirements," S&P added. ASSOCIATED ESTATES: Moody's Upgrades Debt Shelf Rating to (P)Ba1 ---------------------------------------------------------------- Moody's Investors Service has upgraded Associated Estates' senior unsecured debt shelf rating to (P)Ba1 from (P)Ba2. The rating outlook is stable. These ratings were upgraded with a stable outlook: -- Associated Estates Realty Corporation. -- senior unsecured debt shelf to (P)Ba1 from (P)Ba2; preferred stock shelf to (P)Ba3 from (P)B1. RATINGS RATIONALE Today's rating actions reflect Associated Estates' consistently sound operating performance, and progress in growing the size and quality of its multifamily real estate portfolio. The upgrade also reflects the REIT's continued improvement in credit metrics as a result of significant common equity issuances in 2010. Moody's notes Associated Estates' demonstrated resilient operating performance through the recession, partly due to its mix of Class A and Class B assets, which provide balance to its portfolio. Same-store NOI increased 4.8% in 1Q11 and Moody's expects continued earnings improvement due to the favorable outlook for multifamily real estate fundamentals. Associated Estates has also made significant progress in growing the size and quality of its multifamily portfolio. The REIT acquired $255M of properties in 2010, comprising about 27% of its gross asset value. These are newer, high-quality properties, three of which are located in northern Virginia and one in Dallas. These purchases are consistent with the REIT's strategy of reducing its presence in slower-growth Midwest markets via growth in other markets. Associated Estates maintains adequate liquidity and a well- laddered debt maturity schedule, with no maturities remaining in 2011 and $81 million in 2012. Furthermore, the REIT's key credit metrics have improved due to significant 2010 raises in equity capital. Effective leverage (debt plus preferred stock as a % of gross assets) was a modest 45% at 1Q11, down from 60% at YE09. Fixed charge coverage was 2.2x at 1Q11 versus 1.5x in 2009, and Moody's expects earnings growth will result in further improvement. These credit strengths are counterbalanced by Associated Estates' small size, still high geographic concentration in Midwest markets, and reliance on secured financing for its funding needs. In addition, leverage is still modestly high as measured on a Net Debt/EBITDA basis and EBITDA margins remain weak relative to its multifamily peers. The stable outlook reflects Moody's expectation that Associated Estates will continue to grow and diversify its property portfolio, while maintaining consistent credit metrics. Moody's indicated that a rating upgrade would likely reflect secured debt lower than 20% of gross assets, unencumbered assets (gross book) greater than 60% of gross assets, gross assets closer to $2.0 billion, and sound operating performance with fixed charge coverage above 2.3x. Negative rating pressure would likely reflect material deterioration in operating performance, with fixed charge falling below 2.0x on a sustained basis. Increased overall leverage (debt plus preferred stock greater than 50% of gross assets on a sustained basis) would also result in a ratings downgrade. The principal methodology used in this rating was Global Rating Methodology for REITs and Other Commercial Property Firms, published in July 2010. Associated Estates Realty Corporation [NYSE; NASDAQ: AEC] is a real estate investment trust (REIT) headquartered in Richmond Heights, Ohio. The REIT's portfolio consists of 52 properties containing 13,662 units located in eight states. ATLANTIC MUTUAL: Titanic Insurer Placed in Liquidation ------------------------------------------------------ Alistair Barr, writing for MarketWatch, reports that Atlantic Mutual Insurance Co., which paid claims when the legendary Titanic passenger liner sank in April 1912, was placed into liquidation and New York's superintendent of insurance was appointed liquidator on April 27, according to the website of the New York Liquidation Bureau. Atlantic Mutual Insurance was incorporated under the laws of the state of New York on April 11, 1842. A week after the RMS Titanic hit an iceberg and sank in April 1912, the insurer paid $100,000 in hull coverage, MarketWatch reports, citing BestWire, part of insurance rating agency A.M. Best. According to MarketWatch, BestWire said that by early this century, Atlantic Mutual's surplus was being whittled away by "severe" loss-reserve development in its commercial lines business, mainly from workers' compensation and general liability policies. n 2004, Atlantic Mutual scaled down its operations to focus on personal lines insurance, particularly in the high net-worth market, BestWire added. But the insurer's credit ratings were slashed in 2006 because of the cost of claims from commercial-insurance policies sold years earlier. MarketWatch relates that in 2007, Ace Ltd ACE +0.66% bought Atlantic Mutual's high net worth, personal-lines insurance business. By 2010, BestWire said, state insurance regulators had revoked Atlantic Mutual's licenses because it had a negative surplus. According to MarketWatch, BestWire said the liquidation began in April. MarketWatch notes that the workers' comp market in California has been plagued by intense competition, spiraling medical costs, fraud and abuse for many years. More than 20 firms in the business either went bust or left the state from 2000 to 2003. BANKATLANTIC BANCORP: Plans to Offer $30MM Class A Common Stock --------------------------------------------------------------- BankAtlantic Bancorp, Inc., intends to pursue a rights offering for up to $30 million of its Class A Common Stock. A record date of May 12, 2011, has been set for the Offering. In connection with the Offering, the Company will distribute to each holder of its Class A Common Stock and Class B Common Stock, as of the close of business on the record date, non-transferable subscription rights to purchase shares of its Class A Common Stock at a subscription price of $0.75 per share. The amount of subscription rights to be distributed in the Offering will be determined based on the total number of shares of the Company's Class A Common Stock and Class B Common Stock outstanding on the record date. The Company will not issue fractional subscription rights; rather, the number of subscription rights which each shareholder will receive will be rounded up to the nearest whole number. Based on the current number of outstanding shares, it is estimated that each eligible holder of the Company's Class A Common Stock and Class B Common Stock would receive 0.624 subscription rights per share. The Company's Chairman and Chief Executive Officer, Alan B. Levan, commented, "BankAtlantic Bancorp intends to use the proceeds of the Offering, together with cash currently held by BankAtlantic Bancorp, to contribute capital to BankAtlantic, its primary operating subsidiary. While BankAtlantic's capital levels at March 31, 2011 exceeded the traditional definitions of 'well capitalized' regulatory capital thresholds, BankAtlantic is required to achieve by June 30, 2011 and maintain a Tier 1/Core capital ratio of 8% and a Total Risk-based capital ratio of 14%. At March 31, 2011, BankAtlantic's Tier 1/Core capital ratio was 5.97% and its Total Risk-based capital ratio was 11.76%. We are pleased with the relative consistency of our capital ratios over the last four years..." "As previously disclosed, we anticipate that the pending sale of BankAtlantic's Tampa area branches (and associated deposits) and related facilities to PNC Bank, N.A. (anticipated to close June 3, 2011, subject to customary closing conditions and regulatory requirements), will add over 145 basis points to each of BankAtlantic's regulatory capital ratios. We currently anticipate that based upon the expected financial impact of this sale transaction, together with current estimates of BankAtlantic's operating results and asset balances and the proceeds of the Offering, that BankAtlantic will be in a position to meet its higher capital requirements at June 30, 2011. "BankAtlantic Bancorp's Board concluded that proceeding with a rights offering was advisable as it does not entail many of the substantial costs and uncertainties associated with an underwritten public offering and it provides our shareholders the opportunity to purchase shares on a pro rata basis and maintain their ownership position in our Company," Mr. Levan concluded. The currently contemplated terms of the Offering are as follows: each whole subscription right will entitle the holder to subscribe for one share of the Company's Class A Common Stock at the subscription price of $0.75 per share, a 16% discount from today's closing price. This is referred to as the basic subscription right. Rights holders who elect to exercise their basic subscription rights in full will also have an over-subscription option pursuant to which they may request to purchase, at the same $0.75 per share subscription price, additional shares of the Company's Class A Common Stock that remain unsubscribed for at the expiration of the Offering. Any over-subscription request will be subject to acceptance by the Company, the availability of shares of the Company's Class A Common Stock after giving effect to all exercises of basic subscription rights and the allocation of the remaining shares among all rights holders whose over-subscription requests are accepted by the Company. The Company may reject over-subscription requests if it determines that the issuance of shares of Class A Common Stock to a rights holder would jeopardize or limit the Company's ability to use its available net operating losses to offset future taxable income. The subscription rights will be exercisable until 5:00 p.m., New York City time, on June 16, 2011, unless the Company extends the Offering. The Company reserves the right to cancel or terminate the Offering at any time prior to its expiration. Offering materials, including a prospectus supplement and other items necessary to exercise the subscription rights, will be mailed on or about May 16, 2011 to eligible shareholders. The prospectus supplement will contain important information about the Offering, and shareholders are urged to read the document carefully when available. Questions from shareholders about the Offering may be directed to the information agent for the Offering, Georgeson Inc., at 199 Water Street, 26th Floor, New York, New York 10038, telephone (877) 278-4751 for shareholders and (212) 440-9800 for banks and brokers. About BankAtlantic Bancorp BankAtlantic Bancorp (NYSE: BBX) -- http://www.BankAtlanticBancorp.com/-- is a bank holding company and the parent company of BankAtlantic. BankAtlantic -- "Florida's Most Convenient Bank" with a Web presence at http://www.BankAtlantic.com/-- has nearly $6.0 billion in assets and more than 100 stores, and is one of the largest financial institutions headquartered junior in Florida. BankAtlantic has been serving communities throughout Florida since 1952 and currently operates more than 250 conveniently located ATMs. The Company reported a net loss of $143.25 million on $176.31 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $185.82 million on $223.59 million of total interest income during the prior year. The Company's balance sheet at March 31, 2011, showed $4.47 billion in total assets, $4.48 billion in total liabilities and a $8.73 million total deficit. * * * In September 2010, Fitch Ratings downgraded the long-term Issuer Default Ratings of BankAtlantic Bancorp. to 'CC' from 'B-' and its primary operating subsidiary, BankAtlantic FSB to 'CC' from 'B+. The 'CC' long-term IDR indicates a high default probability. Fitch said it believes that BBX will likely require external capital support given the high level of credit costs that continue to impact BBX's financial performance and erode its existing weak level of tangible common equity, which stood at just 1.39% at June 30, 2010. Although BFSB's regulatory capital levels remain 'well-capitalized', Fitch believes the company needs additional capital in order to provide absorption for future losses, particularly since earnings generation on a pre-provision net revenue basis is weak. As reported by the TCR on March 1, 2011, Fitch has affirmed its current Issuer Default Ratings for BankAtlantic Bancorp and its main subsidiary, BankAtlantic FSB at 'CC'/'C' following the announcement regarding the regulatory order with the Office of Thrift Supervision. BankAtlantic has announced that it has entered into a Cease and Desist Order with the OTS at both the bank and holding company level. The regulatory order includes increased regulatory capital requirements, limits to the size of the balance sheet, no new commercial real estate lending and improvements to its credit risk and administration areas. Further, the holding company must also submit a capital plan to maintain and enhance its capital position. BEAZER HOMES: Incurs $54.57 Million Net Loss in March 31 Quarter ---------------------------------------------------------------- Beazer Homes USA, Inc., reported a net loss of $54.57 million on $127.50 million of total revenue for the three months ended March 31, 2011, compared with net income of $5.29 million on $192.45 million of total revenue for the same period during the prior year. The Company also reported a net loss of $103.38 million on $237.80 million of total revenue for the six months ended March 31, 2011, compared with net income of $53.29 million on $405.52 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $1.85 billion in total assets, $1.55 billion in total liabilities and $295.89 million in total stockholders' equity. "As expected, year-over-year comparisons were unfavorably impacted this quarter by the First Time Homebuyers' Tax Credit which pulled forward sales volumes into the second quarter of 2010," said Ian McCarthy, President and Chief Executive Officer of Beazer Homes. "However, we did see seasonal improvement with orders and gross margins up over the first quarter of fiscal 2011. We are hopeful that the latest improvements in employment will help lift consumer confidence in the coming quarters, which is necessary for any significant recovery in housing to occur." A full-text copy of the press release announcing the financial results is available for free at http://is.gd/mzQaLz About Beazer Homes Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/-- headquartered in Atlanta, is one of the country's 10 largest single-family homebuilders with continuing operations in Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New Mexico, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol "BZH." * * * Beazer carries (i) a 'B-' issuer credit rating, with "stable" outlook, from Standard & Poor's, (ii) 'Caa1' probability of default and long term corporate family ratings from Moody's, and (iii) 'B-' issuer default rating, with stable outlook, from Fitch Ratings. Fitch said in November 2010 that the ratings and Outlook for Beazer reflect the company's healthy liquidity position, improved capital structure as well as the challenges still facing the housing market. Fitch expects existing home sales will decline 7.5% in 2010 and increase 6% in 2011. S&P said that although Beazer's business and liquidity profiles have improved, S&P doesn't anticipate raising its ratings on the company over the next 12 months because S&P expects costs associated with the company's heavy debt load will weigh on profitability. The 'Caa1' corporate family rating, Moody's said in November 2010, reflects its expectation that Beazer has reduced costs sufficiently that it will continue to reduce losses in fiscal 2011. The impairments and other charges are likely to be less material going forward, given the company's improving gross margin performance, stabilizing pricing environment, and increasing absorptions. However, Moody's expectation is that Beazer's cash flow performance will weaken in 2011, as the benefits of inventory liquidation have largely played out. The ratings also reflect the company's extended debt maturity profile, improved Moody's- adjusted debt leverage, and increased net worth position. BERKLINE/BENCHCRAFT: Wins Interim Access to Cash Collateral ----------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Berkline/BenchCraft Holdings LLC received interim approval from the bankruptcy court in Wilmington, Delaware, on May 4 to use the secured lender's cash collateral. A final hearing on the use of cash will take place on May 23. Wells Fargo Capital Finance LLC is owed $4.29 million on a first-lien debt, with the collateral worth slightly more than the debt. The Debtor owes $140 million to second lien lenders, which has Goldman Sachs Group Inc. as syndication agent. At the May 23 hearing, the bankruptcy judge will also consider final approval of a deal to sell their assets to Hilco Merchant Resources, which won an auction for the assets pre-bankruptcy. The Debtors filed a motion seeking authority to implement a process to liquidate or sell substantially all of the Debtors' inventory and related assets. The Debtors initially selected Great American Group as stalking horse bidder in exchange for a guaranteed minimum cash payment of $2,265,000, together with a sharing of proceeds pursuant to a formula whereby the Debtors will receive 70% of such proceeds. Following a prepetition auction, Hilco was the winning bidder and the guaranteed minimum amount to be paid to the Debtors increased by $451,000 -- net of the $65,000 breakup fee and expense reimbursement to Great American -- and the sharing percentage payable to the Debtors increased from 70% to 80%. About Berkline/Benchcraft Berkline/BenchCraft Holdings LLC, along with five subsidiaries, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case No. 11-11369) so the couch maker that specializes in home theaters can liquidate. Berkline/Benchcraft is a unit of turnaround specialist Sun Capital Partners Inc. Until their decision to liquidate, the Debtors, with their "Berkline" and "Benchcraft" brands, held a number five market share and had a growing presence in home theater seating including reclining sofas, love seats, and sectionals. In February, Berkline hired FTI Consulting Inc. to help it restructure and find a buyer. When Berkline was unable to sell itself, the Company decided to liquidate and file for bankruptcy. Berkline has a $140 million second-lien loan that is mostly owed to its parent, SCSF Furniture LLC, which isn't in bankruptcy. A total of $15 million is owed on a first lien term loan and revolver from lenders led by Wells Fargo Capital Finance, LLC, as administrative agent. The Debtors also owe $12.5 million under unsecured subordinated notes. Kenneth J. Enos, Esq., and Michael R. Nestor, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in the Chapter 11 case. Attorneys at Morgan, Lewis & Bockius LLP serve as co-counsel. FTI Consulting is the advisor. Epiq Bankruptcy Solutions is the claims and notice agent. BERNARD L. MADOFF: Suit vs. JPM Belongs in District Court --------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that JPMorgan Chase & Co. won the first round fending off a $6.4 billion lawsuit brought by the trustee liquidating Bernard L. Madoff Investment Securities Inc. U.S. District Judge Colleen McMahon ruled on May 4 that the lawsuit belongs in district court, not in bankruptcy court. JPMorgan, based in New York, argued that transferring to district court was mandatory, not discretionary, because the case involves "novel and unsettled" issues of non- bankruptcy federal law that "fall well beyond" the expertise of a bankruptcy judge. Judge McMahon said she would file a written opinion later explaining why the case is properly in district court. Judge McMahon will hold a hearing on July 28 where JPMorgan will seek dismissal of the lawsuit. She directed the bank to file its dismissal motion on June 3. The trustee will file his answering papers by July 15, in advance of the July 28 hearing. Mr. Rochelle points out that Judge McMahon's ruling is the second time in two weeks that a district judge decided to take all or part of a lawsuit by the Madoff trustee out of the bankruptcy court. U.S. District Judge Jed S. Rakoff filed an opinion on April 25 explaining why he would decide whether to dismiss five counts in the Madoff trustee's $9 billion suit against HSBC Holdings Plc. The JPMorgan lawsuit in district court is Picard v. JPMorgan Chase & Co., 11-00913, U.S. District Court, Southern District of New York (Manhattan). The lawsuit in bankruptcy court is Picard v. JPMorgan Chase & Co., 10-04932, U.S. Bankruptcy Court, Southern District of New York (Manhattan). About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping $50 billion. On Dec. 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 Feb. 18, 2011, a total of $6.85 billion in claims by investors has been allowed, with $791.1 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: HSBC Seeks Dismissal of Trustee Lawsuit ---------------------------------------------------------- American Bankruptcy Institute reports that HSBC Holdings Plc. asked a judge to dismiss a lawsuit filed by the trustee liquidating Bernard L. Madoff's firm, saying that he is not allowed by law to bring such suits on behalf of the schemer's customers. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping $50 billion. On Dec. 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 Feb. 18, 2011, a total of $6.85 billion in claims by investors has been allowed, with $791.1 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. BONDS.COM GROUP: Incurs $12.51 Million Net Loss in 2010 ------------------------------------------------------- Bonds.com Group, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K reporting a net loss applicable to common stockholders of $12.51 million on $2.71 million of revenue for the year ended Dec. 31, 2010, compared with a net loss applicable to common stockholders of $4.69 million on $3.90 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $2.27 million in total assets, $9.39 million in total liabilities and a $7.12 million stockholders' deficit. Daszkal Bolton LLP, in Boca Raton, Fla., in its audit reports for the years ended Dec. 31, 2009, and Dec. 31, 2010, expressed substantial doubt about the Company's ability to continue as a going concern. The auditors noted that the Company has sustained recurring losses and has negative cash flows from operations. "We have a history of operating losses since our inception in 2005, and have a working capital deficit of approximately $4.4 million and an accumulated deficit of approximately $28.6 million at Dec. 31, 2010, which together raises doubt about the Company's ability to continue as a going concern," the Company acknowledged in the Form 10-K. A full-text copy of the annual report on Form 10-K is available for free at http://is.gd/pXHcjW About Bonds.com Group Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG) -- http://www.bonds.com/-- through its subsidiary Bonds.com, Inc., serves institutional fixed income investors by providing a comprehensive zero subscription fee online trading platform. The Company designed the BondStation and BondStationPro platforms to provide liquidity and competitive pricing to the fragmented Over- The-Counter Fixed Income marketplace. The Company differentiates itself by offering through Bonds.com, Inc. an inventory of more than 35,000 fixed income securities from more than 175 competing sources. Asset classes currently offered on BondStation and BondStationPro, the Company's fixed income trading platforms, include municipal bonds, corporate bonds, agency bonds, certificates of deposit, emerging market debt, structured products and U.S. Treasuries. C&D TECHNOLOGIES: Incurs $55.55 Million Net Loss in Fiscal 2011 --------------------------------------------------------------- C&D Technologies, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K, reporting a net loss of $55.55 million on $354.83 million of net sales for the fiscal year ended Jan. 31, 2011, compared with a net loss of $25.78 million on $335.71 million of net sales during the prior fiscal year. The Company also reported net income of $7.04 million on $98.67 million of net sales for the three months ended Jan. 31, 2011, compared with a net loss of $6.64 million on $88.40 million of net sales for the same period during the prior year. The Company's balance sheet at Jan. 31, 2011 showed $251.29 million in total assets, $157.76 million in total liabilities and $93.53 million total equity. Dr. Jeffrey A. Graves, President and CEO, said, "Fiscal 2011 represented a year of many challenges, but with our financial restructuring completed in December last year, and significantly improved top line and bottom line performance realized in our recently completed fourth quarter, we believe the global strength of the C & D brand is now beginning to be fully demonstrated. Dr. Graves continued, "Revenues in the fourth quarter reflected over ten percent growth from both the third quarter of the current year and fourth quarter a year ago, driven by strong performance in Asia, as well as the success of our new products globally, partially offset by the ongoing softness in the North American large Uninterruptible Power Supply market. In addition, we continued to make progress throughout the year in modernizing our manufacturing operations and in reducing Selling and Administrative costs. Through these efforts we were very pleased to report today that we generated $6.7 million of Adjusted EBITDA in the fourth quarter and approximately $15.9 million of Adjusted EBITDA for the full fiscal year, in comparison to $1.3 million for fiscal 2010." A full-text copy of the Form 10-K is available for free at: http://is.gd/kUwIGV About C&D Technologies C&D Technologies, Inc., is a manufacturer, marketer and distributor of electrical power storage systems for the standby power storage market. The Company makes lead acid batteries and standby power systems that integrate lead acid batteries with other electronic components, which are used to provide backup or standby power for electrical equipment in the event of power loss from the primary power source. C&D Technologies in December 2010 escaped a bankruptcy filing after completing an out-of-court restructuring that reduced the Company's total debt from approximately $175 million to $50 million. The Company in September had entered into a restructuring support agreement with noteholders to a restructuring that will be effected through (i) an offer to exchange the Company's outstanding notes for up to 95% of the Company's common stock, or (ii) a prepackaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code, if the exchange offer fails to get the requisite support. C&D Technologies elected not to make a semi-annual interest payment due on its 5.25% Convertible Senior Notes due 2025 on Nov. 1, 2010. CABI SMA: Amends Chapter 11 Reorganization Plan ----------------------------------------------- Cabi SMA Tower I, LLLP, filed with the U.S. Bankruptcy Court for the Southern District of Florida, Miami Division, a first amended plan of reorganization and disclosure statement explaining the plan. The Plan provides for a restructuring of the Debtor's financial obligations. The Debtor says the proposed restructuring will provide it with the necessary liquidity to compete effectively in today's business environment. The Plan is premised upon the funding of (i) up to $7 million on the Effective Date in order to consummate the Plan and (ii) shortfalls, if any, by the Reorganized Debtor. The Plan Investors will make the Equity Contribution via a newly formed limited liability company, Teca Group Investments LLC. The First Amended Plan provides for this classification and treatment of claims: Class Description Treatment ----- ----------- --------- NA Administrative Paid in full, in cash. Expenses Est. Allowed Amount: $350,000 Est. Percentage Recovery: 100% NA Priority Tax Paid in full, in cash over a Claims period not exceeding five years from Petition Date, with interest. Est. Allowed Amount: $0 Est. Percentage Recovery: 100% 1 Priority Non-Tax Not impaired. Paid in full, in Claims cash. Est. Allowed Amount: $0 Est. Percentage Recovery: 100% 2 Secured Claim of Unimpaired. Paid in full, in cash Miami-Dade Tax in the amount of any remaining Collector 2009 and 2010 taxes owed to the county. Est. Allowed Amount: $829,126 Est. Percentage Recovery: 100% 3 Secured Tax Impaired. Certificate Est. Allowed Amount: $352,980 Claims Est. Percentage Recovery: 100% 4 Secured Prepetition Impaired. Will receive New Senior Loan Claim Note. Est. Allowed Amount: $16,000,000 Est. Percentage Recovery: 100% 5 Other Secured Impaired. Will receive either of Claims full payment in cash, or reinstatement of claim, satisfaction by the surrender of collateral securing claim, or treatment that otherwise renders the claim unimpaired. Est. Allowed Amount: $0 Est. Percentage Recovery: 100% 6 Customer Deposit Impaired. Will receive cash in Claims the amount of the principal balance of the escrow fund, cash in the statutory amount of any Priority Non-Tax Claim, and cash in the amount of 15% of the holders' allowed unsecured customer deposit claim. Est. Allowed Amount (Secured): $3,909,956 Est. Percentage Recovery: 100% Est. Allowed Amount (Priority): $104,000 Est. Percentage Recovery: 100% Est. Allowed Amount (Unsecured): $2,176,361 Est. Percentage Recovery: 15% 7 General Unsecured Impaired. Will receive cash in Claims the amount equal to 15% of the Allowed Claim. Est. Allowed Amount: $453,404 Est. Percentage Recovery: 15% 8 Unsecured Impaired. Will receive the New Prepetition Loan Junior Note. Claim Est. Allowed Amount: $13,198,303 Est. Percentage Recovery: 100% 9 Old Equity Interests Impaired, no distribution. Est. Allowed Amount: NA Est. Percentage Recovery: 0% A full-text copy of the April 27 Disclosure Statement is available at http://bankrupt.com/misc/CABISMA_DS.pdf About Cabi SMA Tower I Based in Miami, Florida Cabi SMA Tower I, LLLP -- fka Cabi SMA Retail 1, LLC; Cabi SMA, LLLP; Cabi SMA Tower 2, LLC; Cabi SMA Tower 2, LLLP; Capital at Brickell; Cabi SMA Retail 2, LLLP; Cabi SMA Retail 2, LLC; Cabi SMA Tower 1, LLC; and Cabi SMA Retail I, LLLP -- owns multiple vacant parcels around South Miami Avenue and S.W. 14th Street in Miami, Florida. It acquired the parcels to develop residential, hotel, and retail space, including a condominium development. The parcels are being managed by Cabi Developers, LLC pursuant to a management agreement. Cabi SMA Tower I filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 10-49009) on Dec. 28, 2010. Mindy A. Mora, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates Cabi Downtown, LLC (Bankr. S.D. Fla. Case No. 09-27168) and Cabi New River, LLC (Bankr. S.D. Fla. Case No. 10-49013) filed separate Chapter 11 petitions. aesars' capacity to continue to fund operational and capital spending needs and meet debt service obligations relies on meaningful growth in cash flow generation over the next few years," S&P said. "Although the proposed amend and extend transaction would improve Caesars' already strong debt maturity profile," added Mr. Bubeck, "we believe the increase in interest rate offered to extending lenders will weigh on the company's liquidity profile, given weak EBITDA coverage of interest of just 0.9x as of Dec. 31, 2010." "We expect EBITDA to begin to grow this year following three years of moderate declines. However, absent meaningful growth in EBITDA over the next few years, Caesars will likely burn substantial cash to meet capital expenditure needs and may be challenged to continue to meet long-term debt service obligations. The proposed amendment would also allow Caesars to buy back loans from individual lenders at a price that may be below par. Given the company's very weak financial profile, we would likely view buybacks at a price meaningfully below par as tantamount to a default and lower our ratings in accordance with our distressed exchange criteria," S&P stated. CARESTREAM HEALTH: Bank Debt Trades at 5% Off in Secondary Market ----------------------------------------------------------------- Participations in a syndicated loan under which Carestream Health, Inc., is a borrower traded in the secondary market at 95.00 cents- on-the-dollar during the week ended Friday, May 6, 2011, a drop of 1.11 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 350 basis points above LIBOR to borrow under the facility. The bank loan matures on Feb. 22, 2017, and carries Moody's B1 rating and Standard & Poor's BB- rating. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. As reported by the Troubled Company Reporter on Feb. 18, 2011, Moody's affirmed the B1 corporate family rating of Carestream Health, Inc. Concurrently, Moody's assigned a B1 to the proposed $2 billion credit facility including a $150 million first lien senior secured revolver and a $1.85 billion first lien term loan. Proceeds of the proposed credit facility will be used to retire the existing first and second lien credit agreements and pay a $200 million dividend to equity sponsor, Onex. The outlook for the ratings is stable. The B1 corporate family rating is supported by the company's leading market position, large revenue base and diversified global operations. The ratings outlook could improve if the company is able to more than offset the decline in the film business with growth in its other businesses such that the company demonstrates sustained revenue and profitability growth. The TCR also reported that Standard & Poor's assigned its 'BB-' issue-level rating (one notch above the company's corporate credit rating) to Rochester, N.Y.-based Carestream Health, Inc.'s proposed new $2 billion senior secured credit facility. The recovery rating is '2', indicating S&P's expectation of substantial (70%-90%) recovery in the event of a default scenario. S&P expects the company to use the proceeds to refinance existing debt and pay a $200 million dividend to sponsor Onex Corp. The proposed facility includes a $150 million revolver. At the same time, S&P affirmed Carestream's 'B+' corporate credit rating. The outlook is stable. "The ratings on Carestream reflect S&P's expectation that the company is likely to maintain its operating margin of around 20% despite the challenging long-term outlook for the analog medical imaging industry," said Standard & Poor's credit analyst Sarah Wyeth. S&P believes modest capital expenditures will enable the company to continue to generate good free cash flow and gradually pay down deb. Carestream Health, Inc., headquartered in Rochester, New York is a supplier of imaging and IT systems to the medical and dental communities and, also, to other markets. Formerly operating as the Health Group division of Eastman Kodak, the company was acquired by Toronto-based Onex Corporation and Onex Partners II LP in early 2007. For the twelve months ended Sept. 30, 2010, Carestream had revenues of $2.3 billion. CARIBE MEDIA: Bankruptcy Cues Moody's to Slash CFR to 'Ca' ---------------------------------------------------------- Moody's Investors Service changed Caribe Media, Inc.'s Probability of Default Rating (PDR) to D from Caa3 following the company's announcement that it filed voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code on May 3, 2011. In addition, the company's Corporate Family Rating was lowered from Caa2 to Ca and its senior secured revolver and term loan ratings were lowered from B3 to Caa1. The rating outlook was changed to stable from negative. Moody's expects to withdraw all ratings for the company over the near term. Downgrades: Issuer: Caribe Media, Inc. -- Probability of Default Rating, downgraded to D from Caa3 -- Corporate Family Rating, downgraded to Ca from Caa2 -- Senior Secured Revolver due 2012, downgraded to Caa1, LGD2- 11% from B3, LGD2-16% -- Senior Secured Term Loan due 2013, downgraded to Caa1, LGD2- 11% from B3, LGD2-16% Outlook Actions: Issuer: Caribe Media, Inc. -- Outlook, changed to Stable from Negative -- Moody's does not rate Caribe's $50.6 million (includes PIK accretion) of subordinated notes due 2014, which are held entirely by its primary shareholder Welsh, Carson, Anderson & Stowe. RATINGS RATIONALE The downgrade of the PDR to D reflects the company's bankruptcy filing, which Moody's classifies as a "default" event, consistent with the "D" Probability of Default rating. The Ca Corporate Family Rating (CFR) and the Caa1 ratings for the senior secured credit facilities were based on the application of Moody's Loss Given Default framework utilizing an expected 50% family recovery rate for the overall company, and an 80% to 90% recovery rate for the senior secured credit facilities. Caribe Media, Inc.'s ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Caribe Media, Inc.'s core industry and believes Caribe Media, Inc.'s ratings are comparable to those of other issuers with similar credit risk. Caribe Media, Inc., based in Puerto Rico, owns directory publishing operating subsidiaries in two Caribbean nations. In Puerto Rico, Caribe owns 60% of Axesa Servicios de Informacion S. en C. and Axesa Servicios de Informacion Inc., and in the Dominican Republic Caribe owns 100% of Caribe Servicios de Informacion Dominicana S.A. The company reported revenues of approximately $92 million for the eleven months ended November 2010. The company is an indirect, wholly-owned subsidiary of Local Insight Media Holdings, Inc. whose primary owner is Welsh, Carson, Anderson & Stowe. CASCADE BANCORP: Five Proposals Approved at Annual Meeting ---------------------------------------------------------- Cascade Bancorp held its 2010 Annual Meeting of Shareholders on April 25, 2011. Five proposals were submitted to and approved by the Company's shareholders. The holders of 44,123,715 shares of common stock, 93.76% of the outstanding shares entitled to vote as of the record date, which constituted a quorum, were represented at the meeting in person or by proxy. Stockholders approved these proposals: (1) Election of 10 directors to the Board of Directors: * Jerol E. Andres * Henry H. Hewitt * Gary L. Hoffman * Judith A. Johansen * Patricia L. Moss * Ryan R. Patrick * Thomas M. Wells * Chris Casciato * Michael Connolly * James B. Lockhart III (2) The amendment to the 2008 Performance Incentive Plan increasing the number of shares of stock reserved for issuance under the Plan from 1,000,000 to 6,000,000. (3) Ratification of the appointment of Delap LLP as the Company's independent auditors for 2011. (4) Approval, on an advisory basis, of the Company's executive compensation. (5) One year advisory vote on executive compensation. About Cascade Bancorp Bend, Ore.-based Cascade Bancorp (Nasdaq: CACB) through its wholly-owned subsidiary, Bank of the Cascades, offers full-service community banking through 32 branches in Central Oregon, Southern Oregon, Portland/Salem Oregon and Boise/Treasure Valley Idaho. Cascade Bancorp has no significant assets or operations other than the Bank. The Company's balance sheet at Dec. 31, 2010, showed $1.71 billion in total assets, $1.70 billion in total liabilities, and $10.05 million in total stockholders' equity. Weiss Ratings has assigned its E- rating to Bend, Ore.-based Bank of The Cascades. The rating company says that the institution currently demonstrates what it considers to be significant weaknesses and has also failed some of the basic tests it uses to identify fiscal stability. "Even in a favorable economic environment," Weiss says, "it is our opinion that depositors or creditors could incur significant risks." As of March 31, 2010, the bank's balance sheet showed $2.088 billion in assets. The Company reported a net loss of $13.65 million on $84.98 million of total interest and dividend income for the year ended Dec. 31, 2010, compared with a net loss of $114.83 million on $106.81 million of total interest and dividend income during the prior year. CELANESE CORP: Moody's Assigns 'Ba3' Rating to New Unsecured Notes ------------------------------------------------------------------ Moody's Investors Service assigned a Ba3 rating to $400 million of senior unsecured notes due 2021 to be issued by Celanese US Holdings LLC (CUSH), which are guaranteed by Celanese Corporation (Celanese) and certain subsidiary guarantors. Proceeds from the notes and roughly $122 million of cash will be used to reduce amounts outstanding under its term loan B. The outlook is stable. "Celanese's credit metrics have strengthened significantly over the past year due to a combination of improved financial performance and modest debt reduction;" stated John Rogers, Senior Vice President at Moody's, "Metrics should improve further along with company's financial performance in 2011." Moody's raised the senior secured ratings on the revolvers and term loans at Celanese U.S. Holdings LLC to Ba1 from Ba2 due to the decline in secured debt subsequent to this transaction. Moody's also affirmed the existing Ba2 corporate family rating at Celanese Corporation, the Ba3 ratings on senior unsecured debt at Celanese U.S. Holdings LLC, the B1 ratings on industrial revenue bonds supported by CNA Holdings Inc and Celanese's SGL-1 Speculative Grade Liquidity rating. Celanese's Ba2 CFR takes into account Celanese's strong competitive positions in the acetyl chain, acetate tow and engineered polymers. All of these businesses have meaningful competitive barriers, including process know-how and requirements for world scale production capabilities. The rating is tempered by its significant exposure to volatile petrochemical feedstocks and sizable debt-like liabilities that weaken its credit metrics. The Ba3 rating on the unsecured notes reflects their size relative to the amount of debt in the capital structure, as well as the limited collateral provided to the secured revolver and term loans. Despite Celanese's very large cash balance, Moody's does not utilize net debt metrics given prior statements by management that funding strategic growth is the highest priority for cash. Management has continued to fund modest debt reduction along with shareholder remuneration activities. Last week Celanese announced an increase its share repurchase authorization to $200 million and a 20% increase in its dividend (i.e., $6 million per year increase). The stable outlook reflects Moody's expectations for continued improvement in Celanese's financial performance, from very weak levels through much of 2010 and modest debt reduction. LTM metrics ending March 31, 2011 are supportive of the rating (e.g., 3.7x Debt/EBITDA, 17% Retained Cash Flow/Debt and 5% Free Cash Flow/Debt). If the company's EBITDA rises above $1.3 billion in 2011 (the company's most recent earnings projection for 2011 has it close to this level) and debt remains at or below current levels, there would be positive pressure on the ratings. There is limited downside to the rating at the current time. Moody's adjusted credit metrics are substantially different that it's reported metrics due to significant debt-like liabilities including roughly $1 billion in pension liabilities and $900 million in operating leases. Celanese's SGL-1 Speculative Grade Liquidity rating is supported by a large cash balance of over $600 million (subsequent to this transaction), expected free cash flow generation of over $300 million in the next four quarters (excluding the Kelsterbach relocation expenses) and full availability under its $600 million revolving credit facility. Ratings assigned: Celanese U.S. Holdings LLC -- $400 million guaranteed senior unsecured notes due 2021 at Ba3 (LGD4, 61%) -- Senior unsecured shelf at (P)Ba3 Ratings affirmed: Celanese U.S. Holdings LLC -- $600 million guaranteed senior unsecured notes due 2018 at Ba3 (LGD4, 61%) Industrial revenue bonds supported on a senior unsecured basis at B1 (LGD6, 96%) Ratings raised: Celanese U.S. Holdings LLC -- Guaranteed senior secured revolver due 2015 and letter of credit facility due 2014 to Ba1 from Ba2 (LGD3, 34%) -- Guaranteed senior secured term loans due 2014* and 2016 to Ba1 from Ba2 (LGD3, 34%) * Will be repaid upon completion of the transaction and rating will be withdrawn The principal methodology used in rating Celanese was the Global Chemical Industry Methodology, published December 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009 Celanese Corporation, headquartered in Dallas, Texas, is a leading global producer of acetyls, vinyl acetate monomer, emulsions, acetate tow and engineered thermoplastics. Celanese reported sales of $6.1 billion for the LTM period ended March 31, 2011. Celanese US Holdings LLC and Celanese Americas LLC are wholly owned subsidiaries and co-borrowers under the credit facilities. CELL THERAPEUTICS: Retires 7.5% Convertible Senior Notes -------------------------------------------------------- Cell Therapeutics, Inc., has deposited $10.6 million in cash as trust funds with U.S. Bank National Association, as the trustee of the outstanding 7.5% convertible senior notes, which is an amount sufficient to pay and discharge the entire amount due on the Notes, including accrued and unpaid interest. "Due to our successful efforts last year that resulted in a significant reduction of our debt, along with the retirement of the Notes, there now remains only one series of convertible senior notes on the balance sheet. We plan to retire the remaining outstanding convertible senior notes at maturity in December 2011, which would leave CTI free of any remaining convertible debt," said James A. Bianco, M.D., CEO of CTI. About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. The Company reported a net loss of $82.64 million on $319,000 of revenue for the 12 months ended Dec. 31, 2010, compared with a net loss of $82.64 million on $80,000 of total revenue during the same period in 2009. The Company's balance sheet at March 31, 2011 showed $60.92 million in total assets, $43.11 million in total liabilities, $13.46 million in common stock purchase warrants and $4.35 million total shareholders' equity. Marcum LLP, in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern in its audit reports for the financial statements for 2009 and 2010. The independent auditors noted that the Company has incurred losses since its inception, and has a working capital deficiency of approximately $14.2 million at Dec. 31, 2010. The Company in the Form 10-Q said that it does not expect its existing cash and cash equivalents will be sufficient to fund the Company's presently anticipated operations through the third quarter of 2011. CELL THERAPEUTICS: Investors Buy $16MM of Pref. Stock & Warrants ---------------------------------------------------------------- Cell Therapeutics, Inc., has entered into an agreement to sell, subject to customary closing conditions, approximately $16.0 million of shares of its Series 12 Preferred Stock and warrants to purchase shares of its common stock in a registered offering to three institutional investors. Each share of Series 12 Preferred Stock is convertible at the option of the holder, at any time during its existence, into approximately 2,857 shares of common stock at a conversion price of $0.35 per share of common stock, for a total of 45,634,286 shares of common stock. In connection with the offering, the investors received warrants to purchase up to 18,253,714 shares of common stock. The warrants have an exercise price of $0.40 per warrant share, for total potential additional proceeds to the Company of approximately $7.3 million upon exercise of the warrants for cash. The warrants are exercisable immediately and expire five years from the date of issuance. The Company intends to use the net proceeds from the offering for general corporate purposes, which may include, among other things, paying interest on or retiring portions of its outstanding debt, funding research and development, preclinical and clinical trials, the preparation and filing of new drug applications and general working capital. The Company may also use a portion of the net proceeds to fund possible investments in, or acquisitions of, complementary businesses, technologies or products. The Company has recently engaged in limited discussions with third parties regarding such investments or acquisitions, but has no current agreements or commitments with respect to any investment or acquisition. Shares of the Series 12 Preferred Stock will receive dividends in the same amount as any dividends declared and paid on shares of common stock and have no voting rights on general corporate matters. The closing of the offering is expected to occur on May 2, 2011, at which time the Company will receive the cash proceeds and deliver the securities. Rodman & Renshaw, LLC, a wholly-owned subsidiary of Rodman & Renshaw Capital Group, Inc., acted as the exclusive placement agent for the offering. A shelf registration statement relating to the shares of Series 12 Preferred Stock and warrants issued in the offering has been filed with the Securities and Exchange Commission. A prospectus supplement under Rule 424 of the Securities Act of 1933, as amended, relating to the offering will be filed with the SEC. Copies of the prospectus supplement and accompanying prospectus may be obtained directly from the Company by contacting the Company at the following address: Cell Therapeutics, Inc., 501 Elliott Avenue West, Suite 400, Seattle, Washington 98119. This press release does not constitute an offer to sell or a solicitation of an offer to buy the Series 12 Preferred Stock or warrants. No offer, solicitation or sale will be made in any jurisdiction in which such offer, solicitation or sale is unlawful. About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. The Company reported a net loss of $82.64 million on $319,000 of revenue for the 12 months ended Dec. 31, 2010, compared with a net loss of $82.64 million on $80,000 of total revenue during the same period in 2009. The Company's balance sheet at March 31, 2011 showed $60.92 million in total assets, $43.11 million in total liabilities, $13.46 million in common stock purchase warrants and $4.35 million total shareholders' equity. Marcum LLP, in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern in its audit reports for the financial statements for 2009 and 2010. The independent auditors noted that the Company has incurred losses since its inception, and has a working capital deficiency of approximately $14.2 million at Dec. 31, 2010. The Company in the Form 10-Q said that it does not expect its existing cash and cash equivalents will be sufficient to fund the Company's presently anticipated operations through the third quarter of 2011. CELL THERAPEUTICS: Issues 912,686 Warrants to Rodman & Renshaw -------------------------------------------------------------- On April 27, 2011, Cell Therapeutics, Inc., entered into a Securities Purchase Agreement with certain purchasers. Pursuant to the Purchase Agreement, the Company agreed to issue to the Purchasers in a registered offering (i) an aggregate of 15,972 shares of the Company's Series 12 Preferred Stock, no par value per share, initially convertible into 45,634,286 shares of the Company's common stock, no par value per share, and (ii) warrants to purchase up to 18,253,714 shares of Common Stock for an aggregate offering price of approximately $16 million. Prior to the closing, the Purchasers elected to convert all 15,972 shares of Preferred Stock and to receive the 45,634,286 shares of Common Stock issuable upon such conversion at the closing. On May 3, 2011, the Company closed the Offering. In addition, the Company issued Warrants to purchase an aggregate of 912,686 registered shares of Common Stock to Rodman & Renshaw, LLC, as partial compensation for its services in connection with the Offering. The Placement Agent Warrants issued to the Placement Agent have an initial exercise price of $0.4375 per share of Common Stock and are otherwise substantially the same as the Warrants issued in the Offering. A copy of the opinion of Karr Tuttle Campbell related to the legality of the Preferred Stock, the shares of Common Stock issuable upon conversion of the Preferred Stock, the Warrants and the shares of Common Stock issuable upon exercise of the Warrants is available for free at http://is.gd/Ca2hAf About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. The Company reported a net loss of $82.64 million on $319,000 of revenue for the 12 months ended Dec. 31, 2010, compared with a net loss of $82.64 million on $80,000 of total revenue during the same period in 2009. The Company's balance sheet at March 31, 2011 showed $60.92 million in total assets, $43.11 million in total liabilities, $13.46 million in common stock purchase warrants and $4.35 million total shareholders' equity. Marcum LLP, in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern in its audit reports for the financial statements for 2009 and 2010. The independent auditors noted that the Company has incurred losses since its inception, and has a working capital deficiency of approximately $14.2 million at Dec. 31, 2010. The Company in the Form 10-Q said that it does not expect its existing cash and cash equivalents will be sufficient to fund the Company's presently anticipated operations through the third quarter of 2011. CELL THERAPEUTICS: Receives NASDAQ Notice of Non-Compliance ----------------------------------------------------------- Cell Therapeutics, Inc.'s Board of Directors approved a reverse stock split following the Company's receipt on May 3, 2011 of a notification of non-compliance from the staff of The NASDAQ Stock Market LLC. The notification stated that the Company has not regained compliance with NASDAQ Listing Rule 5550(a)(2) because the Company's common stock (the "Common Stock") did not maintain a minimum closing bid price of $1.00 per share over a period of at least ten consecutive business days ending on or prior to May 2, 2011. As a result of the notification of non-compliance, the Common Stock is subject to delisting unless the Company requests a hearing before the NASDAQ Listing Qualifications Panel (the "Panel"). Accordingly, the Company plans to timely request a hearing before the Panel, thereby allowing the Common Stock to continue to trade on The NASDAQ Capital Market pending the issuance of the Panel's decision following the hearing. The Company expects that the hearing will be held within 45 days. At the hearing, the Company will present a plan for achieving compliance with the NASDAQ listing requirements, which will include the implementation of the reverse stock split approved by the Board. The Company anticipates that it will have already effected the reverse stock split by the time of the hearing. Notwithstanding the reverse stock split, there can be no assurance that the Panel will grant the Company's request for continued listing on The NASDAQ Capital Market. In determining whether the Company has regained compliance with the $1.00 per share minimum closing bid price requirement, the NASDAQ will require a closing bid price of at least $1.00 per share for a minimum of ten consecutive business days and may, under the NASDAQ Listing Rules, elect to monitor the trading price of the Common Stock for as long as 20 business days. It is presently anticipated that the reverse stock split will become effective on or about May 15, 2011. Upon the effectiveness of the reverse stock split, each of the Company's shareholders will receive one new share of Common Stock in exchange for every six shares such shareholder holds. The Common Stock will begin trading on a split-adjusted basis on the Mercato Telematico Azionario stock market (the "MTA") in Italy and The NASDAQ Capital Market in the United States on May 16, 2011. On The NASDAQ Capital Market, trading of the Common Stock will appear under the temporary trading symbol "CTICD" in order to inform the investment community of the reverse stock split. The Company's trading symbol will revert to "CTIC" on or about June 13, 2011. The Company's trading symbol on the MTA will not change due to the reverse stock split. The reverse stock split will affect all outstanding and authorized shares of the Common Stock as well as the number of shares of Common Stock underlying stock options and other exercisable or convertible instruments outstanding at the effective time of the reverse stock split. About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. The Company's balance sheet at Dec. 31, 2010, showed $53.6 million in total assets, $45.3 million in total liabilities, $13.4 million in common stock purchase warrants, and a stockholders' deficit of $5.1 million. Marcum LLP, in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern in its audit reports for the financial statements for 2009 and 2010. The independent auditors noted that the Company has incurred losses since its inception, and has a working capital deficiency of approximately $14.2 million at Dec. 31, 2010. The Company reported a net loss of $82.64 million on $319,000 of revenue for the 12 months ended Dec. 31, 2010, compared with a net loss of $82.64 million on $80,000 of total revenue during the same period in 2009. CHARTER COMMS: S&P Keeps 'BB-' Rating on Unsecured Notes -------------------------------------------------------- Standard & Poor's Ratings Services said the increased size of unsecured notes issued by CCO Holdings LLC and CCO Holdings Capital Corp., subsidiaries of St. Louis-based cable TV operator Charter Communications Inc., does not affect ratings on the issue or other ratings on Charter and related entities, including S&P's 'BB-' corporate credit rating on Charter and the stable outlook. "On May 3, 2011, we assigned our 'BB-' issue rating to $1 billion of senior unsecured notes due 2021, to be sold by Charter subsidiaries, along with a '4' recovery rating. The issue size has been increased to $1.5 billion with the company likely to use the incremental net proceeds to repay bank term loans," S&P stated. "Our ratings on Charter continue to reflect aggressive leverage (adjusted debt to EBITDA was 4.8x in 2010); around $2,700 of consolidated debt per basic subscriber, suggesting little, if any, equity cushion; increased competition from AT&T Inc.'s rival U- verse product; the significant, 4.8% basic subscriber erosion experienced in 2010; and continued lagging basic video penetration. Mitigating factors include a fair business position benefiting from favorable cable industry operating characteristics, including the good revenue visibility inherent in the company's subscription-based business model; capital spending largely linked to growth of new revenue-generating units (RGUs); and the significant bandwidth capacity of Charter's fiber/coaxial plant that should equip it to meet foreseeable demand for broadband services," S&P added. Ratings List Charter Communications Inc. Corporate Credit Rating BB-/Stable/-- CCO Holdings LLC CCO Holdings Capital Corp. Senior Unsecured $1.5 bil. notes due 2021 BB- Recovery Rating 4 CHARTER COMMS: Moody's Rates Proposed $1BB Sr. Unsec. Notes 'B1' ---------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to the proposed $1 billion issuance of senior unsecured notes due 2021 of CCO Holdings, LLC (CCO Holdings), an indirect intermediate holding company of Charter Communications, Inc. (Charter) and Ba3 rated CCH II, LLC (legal entity at which Moody's houses the fundamental benchmark Corporate Family Rating or CFR). The company plans to use proceeds to repay first lien bank debt of Charter Communications Operating, LLC (CCO), which matures in March 2014 and March 2015. Although leverage neutral and resulting in some increase in interest expense, the opportunistic refinancing continues Charter's trend of improving its liquidity by raising cost-effective long-term financing and extending the maturity profile. Moody's also affirmed CCH II, LLC's Ba3 corporate family rating, SGL-1 speculative grade liquidity rating, and positive outlook, and raised the ratings on the $4 billion of existing senior unsecured bonds at CCO Holdings to B1, in line with the rating on the proposed bond issuance. The upgrade to B1 incorporates the reduction in senior debt ahead of CCO Holdings bondholders pro forma for the repayment of incremental senior secured first lien debt. The CCO Holdings bonds now represent the single largest class of debt within the capital structure. Moody's also upgraded the ratings on CCO's second lien notes to Ba2 from Ba3 and on CCO Holdings' senior secured first lien (but effectively third lien due to security in CCO stock only) to Ba3 from B1, again due to the reduction in senior capital. Moody's also revised LGD point estimates and affirmed ratings. CCO Holdings, LLC -- $1,000 Million NEW Senior Unsecured Bonds due 2021, Assigned B1, LGD5, 71% -- $1,400 Million (including add-on) of 7% Sr Unsec Nts due 2019, upgraded to B1, LGD5, 71% from B2, LGD5-81% -- $1,000 Million of 7.25% Sr Unsec Nts due 2017, upgraded to B1, LGD5, 71% from B2, LGD5-81% -- $900 Million of 7.875% Sr Unsec Nts due 2018, upgraded to B1, LGD5, 71% from B2, LGD5-81% -- $700 Million of 8.125% Sr Unsec Nts due 2020, upgraded to B1, LGD5, 71% from B2, LGD5-81% -- $350 Million Sr Sec 1st Lien (but CCO stock only, so effectively 3rd Lien) Credit Facility due 2014, Upgraded to Ba3, LGD3, 46% from B1, LGD4, 60% Charter Communications Operating, LLC -- $1,300 Million (0 drawn proforma for transaction) Sr Sec 1st Lien (CCO assets) Revolving Credit Facility due March 2015, Affirmed Ba1, LGD Upgraded to LGD2 16% from LGD2, 17% -- $199 Million Sr Sec 1st Lien (CCO assets) Non-Revolving Credit Facility due 2013, Affirmed Ba1, LGD Upgraded to LGD2 16% from LGD2, 17% -- $3,337 Million (approximately $514 Million outstanding proforma for transaction) Sr Sec 1st Lien (CCO assets) Term Loan B-1 due March 2014, Affirmed Ba1, LGD Upgraded to LGD2 16% from LGD2, 17% -- $500 Million (approximately $66 Million proforma for pending transaction) Sr Sec 1st Lien (CCO assets) Term Loan B-2 due March 2014, Affirmed Ba1, LGD Upgraded to LGD2 16% from LGD2, 17% -- $3,000 Million (approximately $2,979 Million outstanding) Sr Sec 1st Lien (CCO assets) Term Loan C due Sept 2016, Affirmed Ba1, LGD Upgraded to LGD2 16% from LGD2, 17% -- $1,100 Million of 8% Sr Sec 2nd Lien (CCO assets) Nts due 2012, upgraded to Ba2, LGD3-42%, from Ba3, LGD3-48% -- $546 Million of 10.875% Sr Sec 2nd Lien (CCO assets) Nts due 2014, upgraded to Ba2, LGD3-42%, from Ba3, LGD3-48% CCH II, LLC (CCH II) -- Corporate Family Rating, Affirmed Ba3 -- Probability of Default Rating, Affirmed Ba3 -- Speculative Grade Liquidity Rating, Affirmed SGL-1 -- $1,766 Million of 13.5% Sr Unsec Nts due 2016, Affirmed B2 (LGD6-93%) RATINGS RATIONALE Charter's Ba3 corporate family rating continues to reflect its moderately high financial risk, with leverage of almost 5 times debt-to-EBITDA. This leverage poses risk considering the pressure on revenue from its increasingly mature core video offering (which represents about half of total revenue) and the intensely competitive environment in which it operates. The company's substantial scale and Moody's expectations for continued operational improvements and ancillary growth opportunities, along with the meaningful perceived asset value associated with its sizeable (albeit still shrinking) 5+ million customer base, support the rating. Moody's continues to characterize Charter's liquidity as "very good," as indicated by its SGL-1 speculative grade liquidity rating. Significant capacity under CCO's $1.3 billion revolver (estimated availability increases to approximately $1.2 billion pro forma for the transaction) combined with expectations for healthy positive free cash flow (in the $400 to $500 million range) provide ample liquidity to address the nearest meaningful maturity of $1.1 billion second lien notes due in April 2014, as well as modest required amortization. The positive outlook continues to reflect Charter's steadily improving credit profile and expectations that its enhanced financial flexibility will afford the company greater opportunity to invest, which should increase asset value and facilitate further balance sheet strengthening over time. Moody's would consider an upgrade with continued improvements in both financial and operating metrics and commitment to improving the credit profile. Specifically, Moody's could upgrade the CFR based on expectations for sustained leverage below 4.5 times debt- to-EBITDA and free cash flow-to-debt in excess of 5%, along with maintenance of good liquidity. A higher rating would also require Charter to increase penetration levels (to those more in line with industry averages) and grow revenue per homes passed while maintaining margins. Given the positive outlook, limited downward ratings pressure exists over the near term. However, Moody's would likely downgrade ratings if ongoing basic subscriber losses, declining penetration rates, and/or a reversion to more aggressive financial policies contributed to expectations for leverage above 6 times debt-to- EBITDA and/or low single digit or worse free cash flow-to-debt. The principal methodology used in rating Charter Communications was the Global Cable Television Industry Methodology, published July 2009. One of the largest domestic cable multiple system operators serving approximately 4.5 million basic video customers (5.1 million customers in total), Charter Communications, Inc., maintains its headquarters in St. Louis, Missouri. Its annual revenue is approximately $7 billion. CLAIRE'S STORES: Bank Debt Trades at 6% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which Claire's Stores, Inc., is a borrower traded in the secondary market at 94.31 cents- on-the-dollar during the week ended Friday, May 6, 2011, a drop of 0.44 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 275 basis points above LIBOR to borrow under the facility. The bank loan matures on May 29, 2014, and carries Moody's B3 rating and Standard & Poor's B rating. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- is a specialty retailer offering accessories and jewelry for kids, teens, teens, and young women in the 3 to 27age range. The Company is organized based on its geographic markets, which include North American division and European division. As of Jan. 30, 2010, it operated a total of 2,948 stores, of which 1,993 were located in all 50 states of the United States, Puerto Rico, Canada, and the United States Virgin Islands (its North American division) and 955 stores were located in the United Kingdom, France, Switzerland, Spain, Ireland, Austria, Germany, Netherlands, Portugal, and Belgium (its European division). Its stores operate under the trade names Claire's and Icing. In addition, as of Jan. 30, 2010, it franchised 195 stores in the Middle East, Turkey, Russia, South Africa, Poland, Greece, Guatemala and Malta under franchising agreements. It also operates 211 stores in Japan through its Claire's Nippon 50:50 joint venture with AEON Co. Ltd. Claire's Stores reported net income of $4.32 million on $1.42 billion of net sales for the fiscal year ended Jan. 29, 2011, compared with a net loss of $10.40 million on $1.34 billion of net sales for the fiscal year ended Jan. 30, 2010. The Company also reported net income of $21.31 million on $421.91 million of net sales for the three months ended Jan. 29, 2011, compared with net income of $19.46 million on $410.69 million of net sales for the three months ended Jan. 30, 2010. The Company's balance sheet at Jan. 29, 2011, showed $2.86 billion in total assets, $2.89 billion in total liabilities, and a $26.51 million stockholders' deficit. As reported by the Troubled Company Reporter on March 15, 2011, Moody's upgraded Claire's Stores, Inc.'s senior secured bank credit facilities to B3 from Caa1 and its Speculative Grade Liquidity Rating to SGL-2 from SGL-3. All other ratings were affirmed including Claire's Caa2 Corporate Family Rating. The rating outlook is positive. The upgrade of Claire's first lien bank facilities is in response to the repayment of $245 million of the term loan B, which reduced the amount of senior secured first lien bank debt in the capital structure. The upgrade also reflects Claire's recently issued $450 million second lien notes, which provide additional support to the first lien bank facilities. CLEAN BURN: Can Return Liquid Yeast to LET in Exchange for $8,000 ----------------------------------------------------------------- Clean Burn Fuels, LLC, sought and obtained authority from the U.S. Bankruptcy Court for the Middle District of North Carolina, Durham Division, to return totes of liquefied yeast to Lallemand Ethanol Technology in exchange for certain conditions. LET supplies liquefied yeast to the Debtor for use in connection with the production of ethanol. In February, LET delivered a total of seven totes of stabilized liquid yeast to the Debtor. Because of the suspension of production, the Debtor realized it would be unable to use the last five totes. Accordingly, the Debtor and LET agreed that due to the perishable nature of the liquid yeast, the Debtor's estate would not benefit by a return of the goods and the situation should instead be remedied pursuant to Section 546(h) of the Bankruptcy Court. LET, the Debtor, and Cape Fear Farm Credit, ACA, as lender to the Debtor, agree that the yeast will be returned to LET. LET will pay the Lender $8,000 in cash for a release of its liens on the yeast. The Debtor and LET also agree to a credit of $9.340 against LET's unsecured claim against the Debtor. About Clean Burn Clean Burn Fuels LLC, a North Carolina limited liability company founded in 2005, is the first company to produce ethanol in North Carolina. It completed the construction of its ethanol plant in August of 2010 and started producing and selling ethanol and dried distillers grains with solubles (DDGS) shortly thereafter. Clean Burn filed for Chapter 11 bankruptcy protection (Bankr. M.D. N.C. Case No. 11-80562) on April 3, 2011. John A. Northen, Esq., at Northen Blue, L.L.P., represents the Debtor. In its schedules of assets and liabilities, the Company disclosed $79,516,062 in assets and $79,218,681 in liabilities. The schedules valued its ethanol plant at $72,000,000, securing at $66,225,571 claim by a lender. The U.S. Trustee appointed a four-member official committee of unsecured creditors in the bankruptcy case. COASTAL BANK: Closed; Premier American Bank NA Assumes Deposits --------------------------------------------------------------- Coastal Bank of Cocoa Beach, Fla., was closed on Friday, May 6, 2011, by the Office of Thrift Supervision, 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 Coastal Bank. The two branches of Coastal Bank will reopen during regular banking hours as branches of Florida Community Bank, a division of Premier American Bank, N.A. Depositors of Coastal Bank will automatically become depositors of Florida Community 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 Coastal Bank should continue to use their existing branch until they receive notice from Premier American Bank, N.A., that it has completed systems changes to allow other Premier American Bank, N.A., branches to process their accounts as well. As of March 31, 2011, Coastal Bank had around $129.4 million in total assets and $123.9 million in total deposits. In addition to assuming all of the deposits of the failed bank, Premier American Bank, N.A., agreed to purchase essentially all of the assets. The FDIC and Premier American Bank, N.A., entered into a loss- share transaction on $108.2 million of Coastal Bank's assets. Premier American Bank, N.A., 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, please visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html. Customers with questions about the transaction should call the FDIC toll-free at 1-800-894-7292. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/coastal_fl.html. The FDIC estimates that the cost to the Deposit Insurance Fund will be $13.4 million. Compared to other alternatives, Premier American Bank, N.A.'s acquisition was the least costly resolution for the FDIC's DIF. Coastal Bank is the 40th FDIC-insured institution to fail in the nation this year, and the fifth in Florida. The last FDIC-insured institution closed in the state was Cortez Community Bank, Brooksville, on April 29, 2011. COASTAL TECHNOLOGIES: Case Summary & Largest Unsecured Creditor --------------------------------------------------------------- Debtor: Coastal Technologies, Inc. 21711 FM 1093 Richmond, TX 77407 Bankruptcy Case No.: 11-34020 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Richard L. Fuqua, II, Esq. FUQUA & ASSOCIATES, PC 5005 Riverway, Suite 250 Houston, TX 77056 Tel: (713) 960-0277 E-mail: fuqua@fuquakeim.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Jeanne Franck $12,000 15923 Viney Creek Houston, TX 77095 The petition was signed by Robert B. Ferguson, president. COLONIAL BANCGROUP: Creditors Object to FDIC's Ch 7.Bid ------------------------------------------------------- BankruptcyData.com reports that Colonial BancGroup's official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to the motion of the Federal Deposit Insurance Corporation (FDIC), in its capacity as receiver for Colonial Bank, Montgomery, Alabama, to convert the Chapter 11 reorganization case to Chapter 7 liquidation status. The Company also objected to the same FDIC motion. The Company asserts, "Whether or not grounds exist for conversion of this Chapter 11 case to Chapter 7, the Court and all interested parties in this case deserve more than gratuitous, ad hominem attacks by the FDIC-Receiver on the Debtor's chief recovery officer and estate professionals." The objection continues, "The Debtor firmly believes that the Plan is both confirmable and should be confirmed. If the Court agrees, the Conversion Motion should be dismissed for that reason alone. If, however, the Court declines to confirm the Plan, then the unique and unusual circumstances of this case strongly militate against conversion of the case to Chapter 7. The only party in interest that has requested conversion is the FDIC-Receiver - which is the defendant in claims asserted against it by the Debtor, the plaintiff in substantial priority claims asserted against the estate, the entity in control of a substantial portion of the Debtor's business records and the holder of contingent and unliquidated claims that arise only if the Debtor is successful in pending litigation with the FDIC-Receiver. To allow a party in interest who vigorously has asserted in every filing with the Court (including the Conversion Motion) that it does not and will not have a replacement claim (because it will prevail in all disputes with the Debtor) to dictate the direction of a case in which it is the target plaintiff and defendant is reason enough to deny the Conversion Motion." Meanwhile, American Bankruptcy Institute reports that the Federal Deposit Insurance Corp. blasted Colonial BancGroup's request to postpone an upcoming trial over more than $1.5 billion in disputed assets, claiming the bank-holding company's courtroom "gamesmanship" and "stalling tactics" are unfairly hurting its interests. About The Colonial BancGroup Headquartered in Montgomery, Alabama, The Colonial BancGroup, Inc., (NYSE: CNB) owned Colonial Bank, N.A, its banking subsidiary. Colonial Bank -- http://www.colonialbank.com/-- operated 354 branches in Florida, Alabama, Georgia, Nevada and Texas with over $26 billion in assets. On Aug. 14, 2009, Colonial Bank was seized by regulators and the Federal Deposit Insurance Corporation was named receiver. The FDIC sold most of the assets to Branch Banking and Trust, Winston-Salem, North Carolina. BB&T acquired $22 billion in assets and assumed $20 billion in deposits of the Bank. The Colonial BancGroup filed for Chapter 11 bankruptcy protection (Bankr. M.D. Ala. Case No. 09-32303) on Aug. 25, 2009. W. Clark Watson, Esq., at Balch & Bingham LLP, and Rufus T. Dorsey IV, Esq., at Parker Hudson Rainer & Dobbs LLP, serve as counsel to the Debtor. The Debtor disclosed $45 million in total assets and $380 million in total liabilities as of the Petition Date. In September 2009, an Official Committee of Unsecured Creditors was formed consisting of three members, Fine Geddie & Associates, The Bank of New York Trust Company, N.A., and U.S. Bank National Association. Burr & Forman LLP and Schulte Roth & Zabel LLP serve as co-counsel for the Committee. Colonial Brokerage, a wholly owned subsidiary of Colonial BancGroup, filed for Chapter 7 protection with the U.S. Bankruptcy Court in the Middle District of Alabama in June 2010. Susan S. DePaola serves as Chapter 7 trustee. COLTS RUN: Hearing on Cash Collateral Use Request Set for July 20 ----------------------------------------------------------------- A hearing on Colts Run, L.L.C.'s request for authority to use cash collateral is set for July 20, 2011, at 10:30 a.m., before the U.S. Bankruptcy Court for the Northern District of Illinois. 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. COLUMBUS COUNTRY: Case Summary & 12 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Columbus Country Club, Inc. Post Office Box 1041 2331 Military Road Columbus, MS 39703 Bankruptcy Case No.: 11-12005 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Northern District of Mississippi (Aberdeen) Debtor's Counsel: Craig M. Geno, Esq. HARRIS JERNIGAN & GENO, PLLC P.O. Box 3380 Ridgeland, MS 39158-3380 Tel: (601) 427-0048 E-mail: cmgeno@hjglawfirm.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 12 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/msnb11-12005.pdf The petition was signed by Will Cooper, secretary. COMPOSITE TECH: Has Until Today to File Schedules and Statements ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District Of California gave until today, May 9, 2011, Composite Technology Corporation, et al., to file their schedules of assets and liabilities, and statement of financial affairs. The Debtors are represented by: Paul J. Couchot, Esq. Sean A. O'keefe, Esq. Payam Khodadadi, Esq. WINTHROP COUCHOT PROFESSIONAL CORPORATION 660 Newport Center Drive, Fourth Floor Newport Beach, CA 92660 Tel: (949) 720-4100 Fax: (949) 720-4111 E-mails: Pcouchot@Winthropcouchot.Com Sokeefe@Winthropcouchot.Com pkhodadadi@winthropcouchot.com Headquartered in Irvine, California, Composite Technology Corporation -- http://www.compositetechcorp.com-- develops, produces, and markets energy efficient and renewable energy products for the electrical utility industry. During the fiscal year ended Sept. 30, 2010, the Company operated with one operating segment, the cable segment operated as CTC Cable Corporation. The CTC Cable segment sells ACCC conductor, a composite core, high capacity, energy efficient overhead conductor for transmission and distribution lines, and manufactures and sells ACCC core, the composite core component of the conductor, along with hardware connector accessories specifically designed for ACCC applications. It sells ACCC products directly to customers and through various distribution agreements both internationally and in North America. As of Sept. 30, 2010, CTC Cable had over 9,500 kilometers of ACCC conductor installed. Composite Technology filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-15058) on April 10, 2011, Judge Mark S. Wallace presiding. The Debtor's bankruptcy case was reassigned to Judge Scott C. Clarkson on April 13, 2011. Composite Technology estimated assets at $10 million to $50 million and $1 million to $10 million in debts as of the Chapter 11 filing. Paul J. Couchot, Esq., at Winthrop Couchot PC, serves as the Debtors' counsel. CTC Cable Corporation (Bankr. C.D. Calif. Case No. 11-15059) and Stribog, Inc. (Bankr. C.D. Calif. Case No. 11-15065) also filed for Chapter 11 protection. The cases are jointly administered, with Composite Technology as the lead case. CONAGRA FOODS: Moody's Reviews Preferred Shelf '(P)Ba1' Rating -------------------------------------------------------------- Moody's Investors Service placed the Baa2 long-term rating and Prime-2 short-term rating of ConAgra Foods under review for possible downgrade following the company's announced unsolicited proposal to purchase Ralcorp Holdings for $7.4 billion, including $4.9 billion in cash and $2.5 billion in assumed debt. The rating review reflects the possibility that the proposal will lead to a definitive transaction, which could result in a material deterioration in ConAgra's credit profile. If a transaction were to be consummated under the broad terms announced (assuming an all-debt financed transaction) a possible downgrade could be limited to one notch. However, Moody's cautions that the financing plan has not been announced, and terms of the non-binding proposal are likely to change, which could affect Moody's view. ConAgra has stated its intent to maintain an investment grade profile. "We consider ConAgra's announcement . . . to be part of the early stages of negotiation with Ralcorp, so it's much too early to make a full assessment of the strategic merits of the transaction, the execution risks, or the resulting capital structure, if consummated," commented Brian Weddington, Moody's Senior Credit Officer. "However, we believe that maintaining an investment grade rating is a key element to ConAgra's acquisition strategy," added Weddington. In the near-term, Moody's review will monitor further developments with respect to ConAgra's proposed transaction, including Ralcorp's response, which Moody's expects is forthcoming. If both companies should decide to move forward with a transaction, Moody's review will focus on the final details of any such agreement, and the operating and business strategy of the resulting entity. Until either an agreement is reached or ConAgra withdraws its offer, the ratings will remain under review for possible downgrade. Ratings placed under review for downgrade: ConAgra Foods, Inc. -- LT Issuer Rating at Baa2; -- Senior unsecured debt at Baa2; -- Subordinated debt at Baa3; -- Commercial paper at Prime-2 -- Senior secured MTN program at (P)Baa2; -- Senior unsecured shelf at (P)Baa2; -- Subordinated shelf at (P)Baa3; -- Preferred shelf at (P)Ba1. In late February 2011, ConAgra privately contacted Ralcorp to arrange a meeting to discuss a potential combination of the companies and followed up with a letter to Ralcorp's board of directors proposing an $82 per share offer in cash and ConAgra stock. The offer was rejected by Ralcorp's board, which Ralcorp disclosed publicly on March 1, 2011 without naming a suitor. ConAgra's increased offer represents a 32% premium to Ralcorp's closing price on March 21, the day prior to ConAgra's initial offer letter, and values Ralcorp at approximately 12 times EBITDA of $622 million reported for the last twelve months ended December 2010 and approximately 10 times proforma EBITDA, reflecting Ralcorp's recent acquisition of American Italian Pasta in June 2010. "Ten times EBITDA would be a rich multiple for a mostly private label business, in Moody's view; however, ConAgra believes it can generate $250 million of cost synergies from the transaction, which would bring the multiple down to below eight times on a proforma basis," said Weddington. ConAgra Foods, Inc. is one of North America's leading packaged food companies, serving grocery, club and convenience retailers, as well as restaurants and other foodservice establishments. Popular ConAgra consumer brands include: Banquet, Chef Boyardee, Egg Beaters, Healthy Choice, Hebrew National, Hunt's, Marie Callender's, Orville Redenbacher's, PAM, Reddi-wip, and Swiss Miss. ConAgra generates approximately $12.2 billion in annual sales. Ralcorp Holdings, Inc. is a Missouri corporation that manufactures, markets and distributes Post(R) branded cereals and a wide variety of private label food products in the grocery, mass merchandise, drug and foodservice channels. Substantially all products are sold to customers within the United States. Ralcorp generates approximately $4.6 billion in annual sales. The principal methodology used in rating ConAgra Foods, Inc. was the Moody's Global Consumer Packaged Goods Industry Methodology , published July 2009. COUNTRYVIEW MHC: Disclosure Statement Hearing Set for May 24 ------------------------------------------------------------ Judge Carol A. Doyle of the U.S. Bankruptcy Court for the Northern District of Illinois will convene a hearing on May 24, 2011, at 10:30 a.m., to consider approval of the disclosure statement explaining the plan of reorganization Countryview MHC Limited Partnership. Objections to the disclosure statement are due May 20. The Plan provides for distributions to the holders of allowed claims from funds realized from the continued operation of the Debtor's business as well as from existing cash deposits and cash resources of the Debtor. To the extent necessary, the payment to Bank of America, as successor by merger to LaSalle Bank National Association, in its capacity as trustee for the registered holders of LB-UBS Commercial Mortgage Trust 2006-C4, Commercial Mortgage Pass-Through Certificate, Series 2006-C4, as required by the Plan, may be paid from the proceeds of the refinancing of the underlying mortgage indebtedness due to Lender or from the sale of a manufactured home community owned by the Debtor, consisting of approximately 275 sites, situated on approximately 59.02 acres, located at 1199 Hospital Road, Franklin, Indiana. The Plan has one category of administrative claims, one category of tax claims, five Classes of creditors and one class of interests. Administrative Claims are unimpaired under the Plan and primarily consist of allowed claims comprised of fees and expenses of the various professionals employed pursuant to orders entered by the Court. The Debtor owes its counsel, Crane Heyman Simon Welch & Clar, $40,000 in fees and expenses. Tax Claims will be paid in full, in cash inclusive of interest at the applicable statutory interest rate on the Effective Date, unless the holder of a Tax Claim agrees to a different treatment. The Lender has filed a proof of claim amounting approximately $11,704,158, plus unpaid interest, costs, expenses and other charges, as of Nov. 29, 2010, with respect to its mortgage indebtedness. The actual allowed amount of the Class 1 Claims may be determined pursuant to a further Court order if the Debtor has objections to the allowance of the Class 1 Claims. Under the Plan, the Allowed Class 1 Claims are treated in this manner: Adequate Protection Payments received by Lender during the course of this Chapter 11 case will be applied according to this priority: (1) Payment of interest due to Lender on the principal indebtedness due at the non-default interest rate provided for in its loan documents; (2) Payment of any pre-petition unpaid arrearage due to Lender under its loan documents; (3) Payment of Lender's professional fees and costs to the extent allowable under its loan documents, and approved by the Court; and (4) Payment of the balance, if any, to reduce the principal balance due on the Allowed Class 1 Claims. In full satisfaction, settlement, release, and discharge of and in exchange for the Allowed Claims in Class 1, the holder of the Allowed Class 1 Claims will receive or retain its liens on the real and personal property owned by the Debtor. Unsecured Creditors, who hold approximately $86,220, are the holders of Allowed Class 4 Claims and are impaired under the Plan. The Allowed Class 4 Claims will accrue interest at an annual rate of 5.66% and will be paid interest only on a monthly basis for five years computed on actual days/360 day year. Monthly principal and interest payments commence in year six based on a 5.66% annual interest rate and an eight year amortization schedule with a final balloon payment of approximately $25,331 due the last day of the 11th year. Upon the occurrence of a certain "Trigger Event" a new plan will be implemented allowing for an earlier balloon payment. All interest payments are made monthly in arrears payable on the 15th day of each month with the first payment due on the 15th day of the month after the Effective Date. The plan implemented due to the Trigger Event will be in effect until the Allowed Class 4 Claims are paid in full, which will occur prior to the implemented plan's maturity date upon the occurrence of the refinancing or sale of Property. Increases in scheduled payments in accordance with the newly implemented plan only apply to scheduled monthly payments after the Trigger Date. Payment of the unpaid amount of the Allowed Class 4 Claims may be made in whole or in part, from time to time, without penalty or charge at the sole and exclusive option of the Debtor. With regard to Richard J. Klarchek's claim amounting $13,103,921, no payments will be made on that claim until all other creditors are paid in full pursuant to the terms of the Plan. The Debtor's general partner, Countryview MHC Corp., which holds a 1% interest and the Debtor's limited partner, The Klarcheck Family Trust, which holds a 99% Interest are the holders of the Allowed Class 6 Interests. Under the Plan, they will retain their equity interests in the Debtor after Confirmation of the Plan. Except as otherwise ordered by the Bankruptcy Court or as otherwise provided in the Plan, the Debtor will file any and all objections to the allowance of Claims or Interests on or within 120 days after confirmation of the Plan unless extended by the Court. Cause shall not be a requirement for an extension of the deadline. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/CountryviewMHC_DS.pdf About Countryview MHC Countryview MHC Limited Partnership is an Illinois limited partnership that owns a manufactured home community, consisting of approximately 275 sites, situated in Franklin, Indiana. It filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 10-52722) on Nov. 29, 2010. Eugene Crane, Esq., at Crane Heyman Simon Welch & Clar, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. CYBEX INTERNATIONAL: Files Q1 Form 10-Q; Posts $379,000 Net Income ------------------------------------------------------------------ Cybex International, Inc., filed its quarterly report on Form 10-Q, reporting net income of $379,000 on 0$31.0 million of net sales for the three months ended March 26, 2011, compared with a net loss of $753,000 on $26.1 million of net sales for the three months ended March 27, 2010. The Company's balance sheet at March 26, 2011, showed $84.3 million in total assets, $98.8 million in total liabilities, and a stockholders' deficit of $14.5 million. As reported in the TCR on April 8, 2011, KPMG LLP, in Pittsburgh, Pa., expressed substantial doubt about Cybex International's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that a December 2010 jury verdict in a product liability suit apportions a significant amount of liability to the Company. "The Company does not have the resources to satisfy a judgment in this matter that has not been substantially reduced from the jury verdict, which raises substantial doubt about the Company's ability to continue as a going concern." A complete text of the Form 10-Q is available for free at: http://is.gd/gI4ArT About Cybex International Medway, Mass.-based Cybex International, Inc. (NASDAQ: CYBI) -- http://www.cybexintl.com/--is a manufacturer of exercise equipment and develops, manufactures and markets strength and cardiovascular fitness equipment products for the commercial and, to a lesser extent, consumer markets. CYBEX INTERNATIONAL: Files Form 10-Q; Posts $379,000 Net Income --------------------------------------------------------------- Cybex International, Inc., reported net income of $379,000 on $31.01 million of net sales for the three months ended March 26, 2011, compared with a net loss of $753,000 on $26.11 million of net sales for the three months ended March 27, 2010. The Company's balance sheet at March 26, 2011 showed $84.35 million in total assets, $98.82 million in total liabilities and a $14.47 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/gI4ArT About Cybex International Medway, Mass.-based Cybex International, Inc. (NASDAQ: CYBI) -- http://www.cybexintl.com/--is a manufacturer of exercise equipment and develops, manufactures and markets strength and cardiovascular fitness equipment products for the commercial and, to a lesser extent, consumer markets. The Company reported a net loss of $58.2 million on $123.0 million of sales for 2010, compared with a net loss of $2.4 million on $120.5 million of sales for 2009. KPMG LLP, in Pittsburgh, Pa., expressed substantial doubt about Cybex International's ability to continue as a going concern. The independent auditors noted that a December 2010 jury verdict in a product liability suit apportions a significant amount of liability to the Company. "The Company does not have the resources to satisfy a judgment in this matter that has not been substantially reduced from the jury verdict, which raises substantial doubt about the Company's ability to continue as a going concern." DENNY'S CORPORATION: Reports $4.12MM Net Income in March 30 Qtr. ---------------------------------------------------------------- Denny's Corporation filed with the U.S. Securities and Exchange Commission a quarterly report on Form 10-Q reporting net income of $4.12 million on $135.80 million of total operating revenue for the quarter ended March 30, 2011, compared with net income of $4.58 million on $137.57 million of total operating revenue for the quarter ended March 31, 2010. The Company's balance sheet at March 30, 2011 showed $296.77 million in total assets, $399.02 million in total liabilities and a $102.25 million total shareholders' deficit. John Miller, President and Chief Executive Officer, stated, "Denny's continued to build on the positive achievements realized in the second half of 2010. In the first quarter, same-store guest trends continued to improve as we executed on our marketing strategies that emphasize everyday affordability combined with attractive "Limited Time Offers." We are pleased that our efforts resulted in continued progress despite inflationary pressures and economic uncertainty impacting our customers. In addition, we opened 18 new units in the quarter after completing a company record opening of 136 new unit openings last year." A full-text copy of the Form 10-Q is available for free at: http://is.gd/h0CBLg About Denny's Corporation Based in Spartanburg, South Carolina, Denny's Corporation (NASDAQ: DENN) -- http://www.dennys.com/-- Denny's is one of America's largest full-service family restaurant chains, consisting of 1,348 franchised and licensed units and 232 company-owned units, with operations in the United States, Canada, Costa Rica, Guam, Mexico, New Zealand and Puerto Rico. Denny's carries 'B2' corporate family and probability of default ratings from Moody's Investors Service and a 'B+' corporate credit rating from Standard & Poor's. DEX MEDIA EAST: Bank Debt Trades at 20% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which Dex Media East LLC is a borrower traded in the secondary market at 79.68 cents-on- the-dollar during the week ended Friday, May 6, 2011, an increase of 0.45 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 250 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 24, 2014. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Dex Media East Based in Cary, North Carolina, R.H. Donnelley Corp., formerly known as The Dun & Bradstreet Corp. (NYSE: RHD) -- http://www.rhdonnelley.com/-- publishes and distributes print and online directories in the U.S. It offers print directory advertising products, such as yellow pages and white pages directories. R.H. Donnelley Inc., Dex Media, Inc., and Local Launch, Inc., are the company's only direct wholly owned subsidiaries. Dex Media East LLC is a publisher of the official yellow pages and white pages directories for Qwest Communications International Inc. (Qwest) in the states, where Qwest is the primary incumbent local exchange carrier, such as Colorado, Iowa, Minnesota, Nebraska, New Mexico, North Dakota and South Dakota. R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media East LLC, Dex Media West LLC and Dex Media, Inc., filed for Chapter 11 protection (Bank. D. Del. Case No. 09-11833 through 09- 11852) on May 28, 2009, after missing a $55 million interest payment on its senior unsecured notes due April 15, 2009. James F. Conlan, Esq., Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq., Jeffrey E. Bjork, Esq., and Peter K. Booth, Esq., at Sidley Austin LLP, in Chicago, Illinois represent the Debtors in their restructuring efforts. Edmon L. Morton, Esq., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' financial advisor is Deloitte Financial Advisory Services LLP while its investment banker is Lazard Freres & Co. LLC. The Garden City Group, Inc., is claims and noticing agent. The Official Committee of Unsecured Creditors tapped Ropes & Gray LLP as its counsel, Cozen O'Connor as Delaware bankruptcy co-Counsel, J.H. Cohn LLP as its financial advisor and forensic accountant, and The Blackstone Group, LP, as its financial and restructuring advisor. The Debtors emerged from Chapter 11 bankruptcy proceedings at the end of January 2010. DOT VN: Vietnamese IDN Registrations Exceed 101,000 --------------------------------------------------- Dot VN, Inc., announced that since its official launch on April 28, 2011, the Vietnamese Native Language Internationalized Domain Names have exceeded 101,000 registrations. The launch, hosted at VNNIC's headquarters in Hanoi, Vietnam on April 28th, featured key note addresses from VNNIC, Key-Systems and Dot VN with additional guests from the government, local partners and resellers and the Vietnamese national media. The Vietnamese IDN launch seems to be following the current trend in native language domain name adoption by non-English speaking countries. Recent native language IDN launches by other countries such as Russia have been well received with over 821,000 Russian IDNs registered since its launch in November of 2010. "We are amazed with the response that we have seen to the Vietnamese IDNs," said Dot VN CEO Thomas Johnson. "The number of registrations has far exceeded both VNNIC's expectations and our own. Based on the response we expect to accelerate our plans to capitalize on the wide spread adoption of the IDNs that we have seen over the past 5 days." About Dot VN Dot VN, Inc. (OTC BB: DTVI) -- http://www.DotVN.com/-- provides Internet and telecommunication services for Vietnam and operates and manages Vietnam's innovative online media web property, www.INFO.VN. The Company is the "exclusive online global domain name registrar for .VN (Vietnam)." Dot VN is the sole distributor of Micro-Modular Data Centers(TM) solutions and E-Link 1000EXR Wireless Gigabit Radios to Vietnam and Southeast Asia region. Dot VN is headquartered in San Diego, California with offices in Hanoi, Danang and Ho Chi Minh City, Vietnam. Dot VN was incorporated in the State of Delaware on May 27, 1998, under the name Trincomali Ltd. The Company's balance sheet at Jan. 31, 2011, showed $2.74 million in total assets, $10.92 million in total liabilities and $8.18 million in total shareholders' deficit. Dot VN reported a $7.3 million net loss on $1.1 million of revenues for the fiscal year ended April 30, 2010, compared with a $5.4 million net loss on $1.0 million of revenues for the same period a year ago. Following the Company's results for fiscal 2010, Chang G. Park CPA expressed substantial doubt against Dot VN's ability to continue as a going concern, citing the Company's losses from operations. DS WATERS: S&P Lowers CCR to 'CCC+'; Outlook Developing ------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on DS Waters of America Inc., including its corporate credit rating to 'CCC+' from 'B'. "We removed all ratings from CreditWatch, where they were placed with negative implications on Feb. 10, 2011, following the company's weaker-than-expected operating performance, as well as our concern about its significant near-term refinancing risk. The outlook is developing. For analytical purposes, we view DS Waters and its holding companies, DSW Group Inc. (Group; not rated) and DSW Holdings (Holdings; not rated), as one economic entity," S&P stated. "The downgrade reflects DS Waters' significant near-term refinancing risk for the majority of its consolidated capital structure," said Standard & Poor's ratings analyst Jean Stout. The company's revolving credit facilities mature in October 2011; Holdings' $300 million term loan matures in March 2012; Group's $225 million PIK note matures in April 2012, followed by DS Waters' term loan in October 2012. "At the same time the company's operating performance has continued to be pressured, which together with Group's growing PIK debt has resulted in weaker credit measures," said Ms. Stout, adding: "We believe that DS Waters will be challenged to improve its operating results amid continued weak economic conditions, as well as expected higher commodity costs." The outlook is developing, reflecting DS Waters' significant refinancing risk, as well as Standard & Poor's belief that the company's financial performance will continue to be negatively affected by the lingering weak macroeconomic environment and volatile commodity costs. EAGLE BRIDGE: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Eagle Bridge Machine & Tool, Inc. 135 State Route 67 Eagle Bridge, NY 12057 Bankruptcy Case No.: 11-11434 Chapter 11 Petition Date: May 4, 2011 Court: U.S. Bankruptcy Court Northern District of New York (Albany) Debtor's Counsel: Peter A. Pastore, Esq. MCNAMEE, LOCHNER, TITUS & WILLIAMS, PC P.O. Box 459 677 Broadway Albany, NY 12201-0459 Tel: (518) 447-3246 E-mail: pastorepa@mltw.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/nynb11-11434.pdf The petition was signed by John Soron, president/CEO. EARTHLINK INC: S&P Gives 'B' Rating on Corporate Credit ------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary 'B' corporate credit rating to Atlanta-based telecom and Internet service provider (ISP) EarthLink Inc. "At the same time, we assigned our preliminary 'B-' issue-level rating and preliminary '5' recovery rating to the company's proposed $400 million of senior unsecured notes," S&P stated. The company may use the proceeds for redemption of its $256 million of convertible senior notes, and the remaining proceeds for general corporate purposes, including acquisitions, as well as redemption or repurchase of its ITC DeltaCom senior secured notes. S&P continued, "We also assigned a 'B-' issue level rating and '5' recovery rating to the company's existing $256 million of convertible notes, which rank equally with the proposed senior unsecured notes issue." "In addition, we affirmed our 'B' corporate credit rating on subsidiary ITC DeltaCom Inc., removed the rating from CreditWatch, and withdrew it. We also affirmed the 'B-' issue-level rating on ITC's $325 million senior secured notes and removed it from CreditWatch. The ratings on ITC DeltaCom had been placed on CreditWatch with positive implications on Oct. 5, 2010, with the announced planned acquisition by EarthLink, which subsequently closed in December 2010," S&P stated. "The ratings on EarthLink reflect the highly competitive nature of the business-oriented telecom markets in which it operates," said Standard & Poor's credit analyst Catherine Cosentino, "and our expectations for ongoing substantial revenue and EBITDA declines in its consumer Internet service business." The company also faces possible integration risks, with its recently acquired telecom service providers ITC DeltaCom and One Communications Inc., which, in our view, could prompt customer service issues and accelerated churn, the latter being an ongoing challenge for all companies in this space. These factors translate into a vulnerable business position. ENERGY FUTURE: Posts $362-Million 1st Quarter Net Loss ------------------------------------------------------ Energy Future Holdings Corp. filed with the U.S. Securities and Exchange Commission a Form 10-Q, reporting a net loss of $362 million on $1.67 billion of operating revenues for the three months ended March 31, 2011, compared with net income of $355 million on $1.99 billion of operating revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $45.13 billion in total assets, $51.38 billion in total liabilities, and a $6.25 billion total deficit. "Our company had solid operational performance during the quarter, despite the severe winter weather and continues to serve a rapidly improving Texas economy." said John Young, CEO, Energy Future Holdings. A full-text copy of the quarterly report on Form 10-Q is available for free at http://is.gd/7C8pgo About Energy Future Energy Future Holdings Corp. is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leveraged buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. * * * In April 2011, Moody's Investors Service affirmed the 'Caa2' Corporate Family Rating, 'Caa3' Probability of Default Rating and SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially distressed company with limited financial flexibility; its capital structure appears to be untenable, calling into question the sustainability of the business model; and there is no expectation for any meaningful debt reduction over the next few years, beyond scheduled amortizations. At the end of February 2011, Fitch Ratings it does not expect to take any immediate rating action on EFH's Texas Competitive Electric Holdings Company LLC or their affiliates based on recent default allegations from lender Aurelius. EFH carries a 'CCC' corporate rating, with negative outlook, from Fitch. EPICOR SOFTWARE: Moody's Attaches 'B2' CFR to Proposed Buyout ------------------------------------------------------------- Moody's Investors Service assigned a B2 corporate family rating to the proposed buyout of Epicor Software Corporation and Activant Solutions Inc. Moody's also assigned Ba3 ratings to the new entity's secured debt facilities and Caa1 ratings to the new senior unsecured notes. The debt will be used to finance the buyout of Epicor and Activant by the private equity firm, Apax Partners. The holding company making the acquisitions, Eagle Parent Co. is expected to change its name to Epicor Software Corporation post closing. The ratings outlook is stable. RATING RATIONALE The B2 corporate family rating reflects the very high leverage pro forma for the transaction with debt to EBITDA at approximately 7x using Moody's standard adjustments (and pro forma for certain cost synergies), as well as the challenges of integrating the two companies. Although initial leverage is more reflective of B3 rated enterprise software companies, free cash flow to debt (pro forma for the transaction) is estimated to be 4-5%, in line with B2 rated software providers. The B2 rating also reflects Moody's expectation that leverage as measured by debt to EBITDA will steadily improve to 6x or below during 2012 once the initial integration has been implemented and restructuring costs are completed. The rating recognizes the strong market positions the two companies have built in their respective vertical markets as well as the diversity in the end markets served. The rating is also supported by the relatively stable maintenance revenue streams at both Epicor and Activant, which experienced only minimal impact during the downturn. Both firms specialize in enterprise application software for mid- sized firms and both have developed expertise and large installed bases in their respective vertical markets. These include applications for manufacturing, distribution, hospitality and retail for Epicor and applications for lumber, hardlines and auto parts retailers and wholesale distributors for Activant. The expertise and large installed base result in very "sticky" maintenance revenues as well as a very strong position to sell additional software applications. Moody's expects the overall mid- market enterprise application market to grow in mid single digits over the next five years though several of Activant's construction focused sectors may lag over the near term. Though there is not a large degree of overlap for the two companies' vertical markets., Moody's expects some integration of products and resources, particularly in the retail and distribution businesses. Moody's has some concern that detailed integration plans and product roadmaps have not yet been determined, but note that both management teams have significant acquisition integration experience. Ratings could face downward pressure if there are disruptions in the integration process or Debt to EBITDA does not appear to be on track to be below 6x by 2012. Given the very high leverage and aggressive financial policies, a ratings upgrade is not likely in the near to medium term. These ratings were assigned: -- Corporate family rating: B2 -- Probability of default: B2 -- $75 million Revolving Credit Facility due 2016, Ba3, LGD3 32% -- $870 million Senior Secured Term Loan B due 2018, Ba3, LGD3 32% -- $465 million Senior Unsecured Notes due 2019, Caa1, LGD5 86% Outlook: stable Ratings on the existing Activant debts will be withdrawn once the transaction closes and those debts are repaid. Ratings on the proposed debt instruments were determined in conjunction with Moody's Loss Given Default Methodology and reflect the instruments' respective position in the capital structure. The principal methodology used in this rating was Moody's Global Software Methodology published in May 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Epicor Software Corporation is headquartered in Irvine, CA and had fiscal year 2010 revenues of $440 million. Activant Solutions Inc. is headquartered in Livermore, CA and had fiscal year 2010 revenues of $371 million. ESTERLINE TECHNOLOGIES: Moody's Says 'Ba2' CFR Unaffected --------------------------------------------------------- Moody's Investors Service said that Esterline Technology Corporation's announcement that it has entered into exclusive negotations to acquire The Souriau Group, a privately held company based in Versailles, France, for ?483 million ($715 million) does not impact the existing ratings of Esterline including the Ba2 corporate family rating and positive outlook. The principal methodology used in rating Esterline Technology Corporation was the Global Aerospace and Defense Methodology, published June 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Esterline Technologies Corporation, headquartered in Bellevue WA, serves aerospace and defense customers with products for avionics, propulsion and guidance systems. The company operates in three business segments: Avionics and Controls, Sensors and Systems and Advanced Materials. Revenues for the twelve months ending Jan. 28, 2011 were approximately $1.6 billion. ESTERLINE TECHNOLOGIES: S&P Affirms 'BB+' Corporate Credit Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its corporate credit rating on Bellevue, Wash.-based Esterline Technologies Corp. The outlook is stable. "We also placed the unsecured debt ratings on CreditWatch with negative implications, reflecting a likely decline in recovery prospects for unsecured lenders due to an increase in secured debt to finance the recently announced proposed acquisition," S&P related. The affirmation reflects Esterline's recent announcement that it plans to acquire Souriau Group (not rated) of France for EUR483 million (approximately $715 million at current exchange rates), which would be its largest acquisition to date. The purchase will be financed with $270 million of cash, a $290 million draw on the company's revolver and a new $155 million international credit facility. "We had contemplated an acquisition of this size in our March 2011 upgrade of the company and, although we expect pro forma debt to EBITDA to increase to around 3x in fiscal 2011 (ending Oct. 31, 2011) from around 2.4x now," said Standard & Poor's credit analyst Christopher DeNicolo, "this is below our previously stated threshold of 4x for a possible downgrade." The company has stated that it is committed to using excess cash flow to reduce debt, so we expect that credit protection measures will likely improve fairly quickly, with debt to EBIDTA below 2.5x and funds from operations (FFO) to debt in the 30%-35% range by fiscal 2012. "The CreditWatch placement for the unsecured debt ratings reflects the likely increase in secured debt to finance the transaction, primarily the new $155 million international facility," added Mr. DeNicolo. "This will likely result in lower recovery for the unsecured debtholders, but we are awaiting further details on the structure of the new facility, especially in regard to collateral and guarantees, before we can resolve the CreditWatch. The company has stated it plans to use cash generated by its non-U.S. operations to repay the new facility." Souriau manufactures electrical connectors for harsh environments, with its key markets being aerospace and defense, nuclear power, oil & gas, and rail. The company's products complement Esterline's range of products and end markets. As less than 30% of Souriau's sales are currently in the U.S., there are opportunities for Esterline to use its customer relationships to expand Souriau's U.S. sales, especially in the defense market. Esterline expects Souriau, which has slightly higher operating margins, to contribute $400 million of sales and $75 million of EBITDA in fiscal 2012. The acquisition is expected to close in July. FENTURA FINANCIAL: Amends SERP Agreement with D. Wollschlager ------------------------------------------------------------- Fentura Financial, Inc., on April 26, 2011, entered into an Amended and Restated Supplemental Executive Retirement Agreement with Daniel J. Wollschlager. The SERP Agreement provides that upon each of the first six anniversaries of Mr. Wollschlager's date of hire and upon his attainment of age 65, Mr. Wollschlager will earn a benefit equal to $35,000. As a result, on Mr. Wollschlager's attainment of age 65, provided he is employed by the Company or its affiliates, Mr. Wollschlager would be entitled to a benefit in the aggregate equal to $245,000. Mr. Wollschlager's original agreement contemplated the same annual benefit of $35,000, but was to be earned upon each of the first five anniversaries only, for a total benefit of $175,000. The SERP Agreement is designed to encourage Mr. Wollschlager to remain a long-term employee of the Company, and to provide specified benefits to Mr. Wollschlager for his contributions to the continued growth, development and future business success of the Company. The retirement benefits are an unsecured obligation of the Company. The SERP Agreement is available for free at: http://is.gd/GRGsD1 About Fentura Financial Based in Fenton, Michigan, Fentura Financial, Inc., is a registered bank holding company, owns and controls The State Bank, Fenton, Michigan, and West Michigan Community Bank, Hudsonville, Michigan, both state nonmember banks, and two nonbank subsidiaries. Fentura Financial shares are traded over the counter under the FETM trading symbol. As reported in the Troubled Company Reporter on March 22, 2010, Crowe Horwath LLP, in Grand Rapids, Mich., 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 net losses in 2009 and 2008, primarily from higher provisions for loan losses, and non-compliance with the higher capital requirements of the Consent Orders. Fentura Financial, Inc., entered into a Written Agreement with the Federal Reserve Bank of Chicago on Nov. 4, 2010. Among other things, the Written Agreement requires that the Company obtain the approval of the FRB prior to paying a dividend; requires that the Company obtain the approval of the FRB prior to making any distribution of interest, principal, or other sums on subordinated debentures or trust preferred securities; prohibits the Company from purchasing or redeeming any shares of its stock without the prior written approval of the FRB; requires the submission of a written capital plan by Jan. 3, 2011, and; requires the Company to submit cash flow projections for the Company to the FRB on a quarterly basis. The Company reported a net loss of $5.38 million on $13.87 million of interest income for the year ended Dec. 31, 2010, compared with a net loss of $16.98 million on $16.24 million of interest income during the prior year. The Company's balance sheet at March 31, 2011, showed $314.46 million in total assets, $298.26 million in total liabilities, and $16.20 million in total stockholders' equity. FIRST FEDERAL: Incurs $1.51 Million Net Loss in March 31 Qtr. ------------------------------------------------------------- First Federal Bancshares of Arkansas, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $1.51 million on $6.25 million of total interest income for the three months ended March 31, 2011, compared with net income of $905,000 on $8.43 million of total interest income for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $577.67 million in total assets, $542.88 million in total liabilities and $34.79 million in total stockholders' equity. The Company anticipates that Bear State Financial Holdings, LLC's purchase of the First Closing Shares and the Investor Warrant will take place during May 2011, subject to satisfying the conditions set forth in the Investment Agreement, which will bring the Company and the Bank into compliance with the capital requirements of the Orders. However, uncertainty regarding the conditions which must to be met prior to closing and the Company's current noncompliance with the capital requirements of the Orders at Dec. 31, 2010, raises substantial doubt about the Company's ability to continue as a going concern. About First Federal Bancshares of Arkansas First Federal Bancshares of Arkansas, Inc. (NASDAQ GM:FFBH) -- http://www.ffbh.com/-- is a unitary savings and loan holding company for First Federal Bank, a community bank serving consumers and businesses with a full range of checking, savings, investment and loan products and services. The Bank, founded in 1934, conducts business from 20 full-service branch locations, one stand-alone loan production office, and 30 ATMs located in Northcentral and Northwest Arkansas. The Company reported a net loss of $4.03 million on $29.82 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $45.49 million on $36.04 million in total interest income during the prior year. BKD, LLP expressed substantial doubt about the bank holding company's ability to continue as a going concern. The accounting firm noted that the Company has experienced significant losses in recent years and has significant levels of nonperforming assets. Furthermore, the Company has entered into a written agreement with the Office of Thrift Supervision which requires the Company to meet certain capital requirements by Dec. 31, 2010, which were not met. FRONT LINE: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: Front Line Concrete Pumping, LLC P.O. Box 3030 Ogden, UT 84409 Bankruptcy Case No.: 11-26468 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: William T. Thurman Debtor's Counsel: Andres Diaz, Esq. DIAZ & LARSEN 307 West 200 South, Suite 2004 Salt Lake City, UT 84101 Tel: (801) 596-1661 Fax: (801) 359-6803 E-mail: courtmail@adexpresslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by David Brett Johnston, managing member. GENOIL INC: Posts $5.6 Million Net Loss in 2010 ----------------------------------------------- Genoil Inc. filed on May 3, 2011, its audited financial statements for the fiscal year ended Dec. 31, 2010. The Company incurred a net loss of C$5.63 million for 2010, compared with a net loss of $5.15 million for 2009. The Company has not generated revenues from its technologies to date and has funded its near term operations by way of capital stock private placements and short-term loans. The Company's balance sheet at Dec. 31, 2010, showed C$5.51 million in total assets, C$2.77 million in total liabilities, and stockholders' equity of C$2.74 million. In addition to the Company's net losses in 2008, 2009, and 2010, at Dec. 31, 2010, the Company has a working capital deficiency of C$2.22 million. "The ability of the Company to continue as a going concern is in substantial doubt and is dependent on achieving profitable operations, commercializing its technologies, and obtaining the necessary financing in order to develop these technologies further," the Company said in the notes to the consolidated financial statements for the years ended Dec. 31, 2010, 2009, and 2008. "The Company is not expected to be profitable during the ensuing twelve months and therefore must rely on securing additional funds from either issuance of debt or equity financing for cash consideration," the Company added. A full-text copy of the Company's consolidated financial statements for the fiscal year ended Dec. 31, 2010, is available for free at http://is.gd/g3MGKz A full-text copy of the Management's Discussion and Analysis of the Company's consolidated financial statements for the fiscal year ended Dec. 31, 2010, is available for free at http://is.gd/siEvdg About Genoil Inc. Genoil Inc. is a technology development company based in Alberta, Canada. The Company specializes in heavy oil upgrading, oily water separation, process system optimization, development, engineering, design and equipment supply, installation, start up and commissioning of services to specific oil production, refining, marine and related markets. The Company's securities trade on both the TSX Venture Exchange (Symbol: GNO) and the NASDAQ OTC Bulletin Board (Symbol: GNOLF). GLOBAL CROSSING: Incurs $33 Million Net Loss in March 31 Qtr. ------------------------------------------------------------- Global Crossing reported a net loss of $33 million on $661 million of revenue for the three months ended March 31, 2011, compared with a net loss of $119 million on $648 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $2.26 billion in total assets, $2.78 billion in total liabilities and a $525 million total shareholders' deficit. "We delivered another quarter of year-over-year growth, with a six percent increase in 'invest and grow' revenue and a nine percent increase in OIBDA," said John Legere, chief executive officer of Global Crossing. "Our first quarter results were consistent with our annual revenue and OIBDA guidance and we remain confident in our growth expectations for 2011. Meanwhile, we are preparing for our strategic combination with Level 3, which will create a stronger competitor with increased scale and resources, significantly greater network reach and a broader portfolio of products and services to serve enterprise and carrier customers around the world." A full-text copy of the press release announcing the financial results is available for free at http://is.gd/llklTh About Global Crossing Based in Hamilton, Bermuda, Global Crossing Limited (NASDAQ: GLBC) -- http://www.globalcrossing.com/-- is a global IP, Ethernet, data center and video solutions provider with the world's first integrated global IP-based network. Global Crossing Limited reported a consolidated net loss of $172 million on $2.609 billion of consolidated revenue for the twelve months ended Dec. 31, 2010, compared with a net loss of $141 million on $2.159 billion of revenue during the prior year. * * * As reported by the Troubled Company Reporter on March 31, 2010, Standard & Poor's Ratings Services raised all its ratings on Global Crossing, including the corporate credit rating to 'B' from 'B-'. The outlook is stable. S&P assigned its 'CCC+' issue-level rating and '6' recovery rating to Global Crossing's proposed $150 million of senior unsecured notes due 2019. The '6' recovery rating indicates S&P's expectation for negligible (0%-10%) recovery in the event of a payment default. GREEN MOUNTAIN: S&P Places 'B' Corp. Credit Rating on Watch Pos. ---------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B' corporate credit rating and issue-level ratings on Waterbury, Vt.-based Green Mountain Coffee Roasters Inc. on CreditWatch with positive implications, meaning that it could either raise or affirm the ratings upon completion of its review. "The CreditWatch placement follows the company's announcement that it will issue shares of common stock and repay a portion of its debt," said Standard & Poor's credit analyst Bea Chiem. Standard & Poor's will seek to resolve the CreditWatch listing within 60-90 days. "We will resolve the CreditWatch following the completion of the equity offering and repayment of a portion of the company's debt. We will also review and discuss the company's financial plans with management," S&P added. GRUBB & ELLIS: Stonerise Capital Discloses 2.2% Equity Stake ------------------------------------------------------------ In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Stonerise Capital Management, LLC, and Stonerise Capital Partners Master Fund, L.P., disclosed that they beneficially own 1,559,541 shares of common stock of Grubb & Ellis Company representing 2.2% of the shares outstanding. The number of shares outstanding of the Company's common stock as of March 28, 2011 was 69,921,581 shares. A full-text copy of the filing is available for free at http://is.gd/VQ4ojW About Grubb & Ellis Santa Ana, Calif.-based Grubb & Ellis Company (NYSE: GBE) -- http://www.grubb-ellis.com/-- is a commercial real estate services and investment management company with over 5,200 professionals in more than 100 company-owned and affiliate offices throughout the United States. The Company's range of services includes tenant representation, property and agency leasing, commercial property and corporate facilities management, property sales, appraisal and valuation and commercial mortgage brokerage and investment management. Through its investment management business, the Company is a leading sponsor of real estate investment programs. The Company reported a net loss of $69.7 million on $575.5 million of revenues for 2010, compared with a net loss of $80.5 million on $527.9 million of revenues for 2009. At Dec. 31, 2010, the Company's balance sheet showed $286.9 million in total assets, $255.8 million in total liabilities, $90.1 million in 12% cumulative participating perpetual convertible preferred stock, and a stockholders' deficit of $59.0 million. GUITAR CENTER: Bank Debt Trades at 4% Off in Secondary Market ------------------------------------------------------------- Participations in a syndicated loan under which Guitar Center, Inc., is a borrower traded in the secondary market at 95.93 cents- on-the-dollar during the week ended Friday, May 6, 2011, a drop of 0.28 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 350 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 9, 2014, and carries Moody's Caa1 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. Guitar Center, Inc., headquartered in Westlake Village, Calif., is the largest musical instrument retailer with 312 stores and a direct response segment, which operates its websites. It operates three distinct musical retail business - Guitar Center (about 70% of revenue), Music & Arts (about 7% of revenue), and Musician's Friend (its direct response subsidiary with 24% of revenue). Total revenue is about $2 billion. * * * As reported in the Troubled Company Reporter on Feb. 28, 2011, Moody's Investors Service affirmed Guitar Center, Inc.'s Caa2 Corporate Family Rating and the $622 million existing term loan rating of Caa1 due October 2014. The Probability of Default Rating was revised to Caa2/LD from Caa2 while the Speculative Grade Liquidity assessment was changed to SGL-2 from SGL-3. The rating outlook remains stable. The Caa2/LD Probability of Default rating reflects Moody's view that the extended deferral of interest on the Holdco notes constitutes a distressed exchange under Moody's definition and also anticipates that additional exchanges of this nature are possible over the near term. The Limited Default designation was prompted by the company's executed amendment of the HoldCo notes, which allows for a deferral of 50% of the interest payments for 18 months. Moody's views this as a distressed exchange that provides default avoidance. This LD designation applies to the proposed follow-on amendment to defer the HoldCo note interest payments by another six months. Subsequent to the actions, Moody's will remove the LD designation and the PDR will be Caa2 going forward. GULFSTREAM INT'L: Asks for Insurance Funds to Defend Lawsuit ------------------------------------------------------------ Dow Jones' DBR Small Cap reports that top executives at Gulfstream International Group Inc. want to spend part of its insurance policy to defend themselves against a lawsuit from investors who are accusing them of masking the Company's struggling finances while trying to raise money last year. About Gulfstream International Fort Lauderdale, Florida-based Gulfstream International Airlines (NYSE Amex: GIA) operated a fleet of turboprop Beechcraft 19000 aircraft, and specialized in providing travelers with access to niche locations not typically covered by major carriers. GIA operated more than 150 scheduled flights per day, serving nine destinations in Florida, 10 destinations in the Bahamas, five destinations from Continental Airline's hub under the Department of Transportation's Essential Air Service Program and supports charter service to Cuba through a services agreement with Gulfstream Air Charter, Inc., an entity otherwise unrelated to the Debtors. GIA operated as a Continental Connection carrier, as well as for United Airlines, Northwest Airlines and Copa Airlines, through code share agreements. GIA has 620 employees, including 530 working full-time. Gulfstream International Group, Inc., and its units including Gulfstream International Airline, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Lead Case No. 10-44131) on Nov. 4, 2010. Brian K. Gart, Esq., at Berger Singerman, P.A., serves as the Debtors' bankruptcy counsel. Jetstream Aviation Capital, LLC and Jetstream Aviation Management, LLC, serve as financial advisors to the Debtors. Robert A. Schatzman, Esq., Steven J. Solomon, Esq., and Frank P. Terzo, Esq., at GrayRobinson, P.A., in Miami, Florida, serve as counsel to the Official Committee of Unsecured Creditors. Gulfstream International Airlines disclosed $15,967,096 in total assets and $25,243,099 in total liabilities. As reported by the Troubled Company Reporter on Jan. 25, 2011, Bankruptcy Judge John K. Olson entered an order authorizing Gulfstream to sell its business to an affiliate of Chicago-based Victory Park Capital Advisors LLC. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that Victory Park is buying Gulfstream in return for financing it provided the Chapter 11 case. In addition, Victory Park is paying Raytheon Aircraft Credit Co. $18.7 million to buy the 21 Beechcraft 1900 D aircraft that Gulfstream operates. Raytheon also will be paid arrears on the aircraft leases. Victory Park will pick up specified expenses of the Chapter 11 case while setting aside a $600,000 fund to pay professional fees. Victory Park is also allowing the creation of a $100,000 fund to finance lawsuits. Mr. Rochelle noted that a prior bankruptcy court order said there will be a "structured dismissal" of the Chapter 11 case within 30 days of the completion of the sale. Victory Park provided Gulfstream with up to $5 million debtor-in- possession financing to fund the Chapter 11 case. GUNDLE/SLT ENVIRONMENTAL: Moody's Upgrades CFR to B3 ---------------------------------------------------- Moody's Investors Service has upgraded the corporate family and probability of default ratings of Gundle/SLT Environmental, Inc. to B3 from Caa1. Concurrently, the company's planned first lien credit facility has been assigned a B3 rating while a planned second lien term loan facility has been assigned a Caa1 rating. Proceeds of the new debts will refinance the company's existing senior notes and revolver borrowings, which come due in 2012. The corporate family rating upgrade to B3 from Caa1 reflects an improving economic environment which should help 2011-2012 revenues, progress made toward the company's operational restructuring reflected in part by better Q1-2011 performance, and liquidity profile improvements that will follow the planned debt raise. The ratings are: -- Corporate family, to B3 from Caa1 -- Probability of default, to B3 from Caa1 -- $45 million first lien, 5 year revolver, assigned B3 LGD 3, 45% -- $125 million first lien, 5 year term loan, assigned B3 LGD 3, 45% -- $40 million second lien, 5.5 year term loan, assigned Caa1 LGD 5, 71% -- $150 million senior unsecured notes due 2012, unchanged at Caa2, LGD 4, 64%, will be withdrawn at close of the planned debt transaction -- Speculative grade liquidity, unchanged at SGL-3 RATINGS RATIONALE The B3 rating reflects the company's still high leverage level and modest interest coverage. However, the improving economy should help the company's sales prospects, leading to further improvement in credit metrics. U.S. geosynthetic liner demand should build over the near-term as solid waste landfill volumes begin to grow again, particularly in 2012 with construction end market activity improving. The current mining and industrial end market demand levels should continue near-term. As well, outside the U.S., favorable economic and population growth trends suggest promising liner demand prospects, especially over the long-term. The less discretionary nature of demand for Gundle's products and the company's wide and established product line add confidence that order volumes will not continue at the weak level seen in 2010. The operational restructuring commenced in 2009-2010 should benefit gross margins and help the company to be, at least modestly, profitable in coming years. In the restructuring Gundle significantly cut direct expenses, and revised contract terms to make selling prices better reflect feedstock costs. The rating anticipates Gundle's search for a permanent CFO concluding in 2011 with involvement of the hired restructuring firm-- instrumental to the company's turnaround-- tapering off. Transition of the financial management function to internal staff should help solidify the company's improved practices and complete a management team transition that began 18 months ago. The company's speculative grade liquidity rating of SGL-3 remains, reflecting adequate liquidity. Moreover, the debt transaction at hand would alleviate the large near-term maturity and provide Gundle a multi-year revolver with a good availability level for the company's size. Following close of the new revolver, the rating would likely improve to SGL-2. The liquidity profile benefits from a high proportion of unsecured operating assets outside the U.S. which could provide a degree of potential alternate liquidity. The stable rating outlook reflects likelihood that with the better financial flexibility upcoming, and the gradually improving economic environment ahead, the company's earnings and cash flow should support B3-level credit metrics, including EBIT to interest in the low 1x range with debt to EBITDA sustainably at 6x or below. Upward rating momentum, not currently expected, would likely follow expectation of debt to EBITDA being sustained below 4x with a good liquidity profile. Downward rating momentum would likely develop with debt to EBITDA expected above 6.5x, or if the liquidity profile were to weaken. The principal methodology used in rating Gundle was the Global Business & Consumer Service Industry Methodology, published October 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Gundle/SLT Environmental, Inc., based in Houston, TX, is a manufacturer of geosynthetic lining products used in environmental protection and for the confinement of solids, liquids and gases in the waste management, liquid containment and mining industries. Gundle markets its products and installation services through internal and third-party distribution channels. Revenues in 2010 were $343 million on a continuing basis. GUNDLE/SLT ENVIRONMENTAL: S&P Raises Corp. Credit Rating to 'B-' ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Houston, Texas-based Gundle/SLT Environmental Inc. by one notch to 'B-' from 'CCC+', and removed the ratings from CreditWatch, where they were originally placed with positive implications on March 31, 2011. The outlook is stable. At the same time, Standard & Poor's assigned preliminary ratings to the company's proposed $205 million-$210 million in credit facilities. The company's proposed $165 million-$170 million first-lien facilities, consisting of a $40 million-$45 million revolving facility and a $125 million term loan, have been assigned a preliminary issue rating of 'B-' with a preliminary recovery rating of '3', indicating that investors could expect meaningful (50%-70%) recovery in the event of a payment default. The proposed $40 million second-lien term loan has been assigned a preliminary issue rating of 'CCC+' with a preliminary recovery rating of '5', indicating that investors could expect modest (10%- 30%) recovery in the event of a payment default. GSE plans to use proceeds to refinance its $51.9 million asset-based revolving facility and $150 million 11% senior subordinated notes. "The upgrade reflects GSE's improving operating performance during the past year, attributable to an improving economic environment, increased demand for the company's products, and benefits derived from pricing improvements and cost reduction initiatives," said Standard & Poor's credit analyst James Siahaan. "Assuming that the refinancing transaction is executed as contemplated, we expect GSE's liquidity to be adequate, with debt maturities extended out until 2016 and sufficient headroom under financial covenants." "The stable outlook reflects our view that, following the completion of the refinancing transaction, GSE's liquidity will be adequate and its debt maturity profile will have improved," Mr. Siahaan continued. The rating on Houston-based Gundle/SLT Environmental Inc. (GSE) reflects Standard & Poor's view of the limited scope of the company's operations and the commodity nature of its products. The company also has vulnerability to fluctuating raw material costs, some customer concentration, weak (though improving) cash-flow protection metrics, and a highly leveraged financial risk profile. The company's market position as the largest manufacturer of geomembrane liners, global manufacturing and distribution capabilities, and relatively stable end markets partially mitigate these factors. With annual sales of about $375 million, GSE is one of the largest participants in the U.S. geosynthetics market. The company makes its products primarily from polyethylene and polypropylene resins, which are used to form geosynthetic containment systems for landfills and other applications to prevent groundwater contamination as well as for the confinement of water, industrial liquids, solids, and gases. Price, quality of products and services, and distribution capabilities are the key competitive factors in the geomembrane market. Raw materials, mainly consisting of plastic resins derived from oil and natural gas, account for about 65% of the cost of sales and could increase if petrochemical prices rise quickly. This factor raises concern because rapid increases in raw material prices pressure profitability and liquidity, particularly when sales volumes are depressed. HAMPTON ROADS: To Effect a 1-for-25 Reverse Stock Split ------------------------------------------------------- The holders of Hampton Roads Bankshares, Inc., common stock, par value $0.01 per share, on Sept. 28, 2010, approved an amendment to the Company's Amended and Restated Articles of Incorporation to effect a reverse stock split of the Common Stock. The shareholders granted the Company's Board of Directors the discretion to determine the appropriate timing and ratio of the reverse stock split. On March 18, 2011, the Board unanimously adopted resolutions approving an amendment to the Articles to effect a 1-for-25 reverse stock split of all outstanding shares of the Common Stock, effective at 11:59 pm, Eastern Daylight Time, on April 27, 2011. Pursuant to the aforementioned shareholder approval and Board resolutions, the Company filed the Amendment with the Virginia State Corporation Commission on April 26, 2011. The Amendment is available for free at http://is.gd/Q0RlIz Prior to the Reverse Stock Split, the Company had 834,680,994 issued and outstanding shares of Common Stock. Following the Reverse Stock Split, the Company has approximately 33,500,000 issued and outstanding shares of Common Stock. On April 26, 2011, in accordance with the stockholder approval requirements under Virginia law and the Articles, and after prior approval by the Board, the Company filed the Amendment to effect the Reverse Stock Split at a ratio of one-for-twenty-five, with any fractional shares resulting from the Reverse Stock Split rounded up to the next highest whole number of shares. In the Reverse Stock Split, each 25 shares of issued and outstanding Common Stock were converted into one share of newly issued Common Stock. The Reverse Stock Split was implemented as of 11:59 p.m. on April 27, 2011, and the Common Stock began trading on the NASDAQ Global Select Market on a split-adjusted basis at market open on April 28, 2011. About Hampton Roads Bankshares Hampton Roads Bankshares, Inc. (NASDAQ: HMPR) -- http://www.hamptonroadsbanksharesinc.com/-- is a bank holding company that was formed in 2001 and is headquartered in Norfolk, Virginia. The Company's primary subsidiaries are Bank of Hampton Roads, which opened for business in 1987, and Shore Bank, which opened in 1961. Currently, Bank of Hampton Roads operates twenty- eight banking offices in the Hampton Roads region of southeastern Virginia and twenty-four offices in Virginia and North Carolina doing business as Gateway Bank & Trust Co. Shore Bank serves the Eastern Shore of Maryland and Virginia through eight banking offices and fifteen ATMs. Effective June 17, 2010, the Company and its banking subsidiary, Bank of Hampton Roads ("BOHR"), entered into a written agreement with the Federal Reserve Bank of Richmond and the Bureau of Financial Institutions of the Virginia State Corporation Commission. The Company's other banking subsidiary, Shore Bank, is not a party to the Written Agreement. Under the terms of the Written Agreement, among other things, BOHR agreed to develop and submit for approval plans to (a) strengthen board oversight of management and BOHR's operations, (b) strengthen credit risk management policies, (c) improve BOHR's position with respect to loans, relationships, or other assets in excess of $2.5 million which are now, or may in the future become, past due more than 90 days, are on BOHR's problem loan list, or adversely classified in any report of examination of BOHR, (d) review and revise, as appropriate, current policy and maintain sound processes for determining, documenting, and recording an adequate allowance for loan and lease losses, (e) improve management of BOHR's liquidity position and funds management policies, (f) provide contingency planning that accounts for adverse scenarios and identifies and quantifies available sources of liquidity for each scenario, (g) reduce the Bank's reliance on brokered deposits, and (h) improve BOHR's earnings and overall condition. The Company said in its Form 10-Q for the Sept. 30, 2010 quarter that due to its financial results, the substantial uncertainty throughout the U.S. banking industry, and the Written Agreement the Company and BOHR have entered into, doubts existed regarding the Company's ability to continue as a going concern through the second quarter of 2010. However, management believes this concern has been mitigated by the initial closing of the Private Placement that occurred on Sept. 30, 2010. The Company reported a net loss of $210.35 million on $122.20 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $201.45 million on $149.44 million of total interest income during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $2.90 billion in total assets, $2.71 billion in total liabilities and $190.79 million in total shareholders' equity. Yount, Hyde & Barbour, P.C., in Winchester, Va., expressed substantial doubt about the Company's ability to continue as a going concern in its report on the Company's restated consolidated financial statements for the year ended Dec. 31, 2009. The independent auditors noted that quantitative measures established by regulation to ensure capital adequacy require the Company and its subsidiary banks to maintain minimum amounts and ratios of total and Tier I capital to risk-weighted assets, and Tier I capital to average assets. In addition, the Company has suffered recurring losses from operations and declining levels of capital. HERCULES OFFSHORE: Files Form 10-Q; Posts $14.2-Mil. Net Loss ------------------------------------------------------------- Hercules Offshore, Inc., filed with the U.S. Securities and Exchange Commission a Form 10-Q reporting a net loss of $14.22 million on $166.24 million of revenue for the three months ended March 31, 2011, compared with a net loss of $15.95 million on $150.85 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $2.01 billion in total assets, $1.17 billion in total liabilities and $839.03 million in stockholders' equity. A full-text copy of the quarterly report on Form 10-Q is available for free at http://is.gd/Po4iPL 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 Company reported a net loss of $134.59 million on $657.48 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $91.73 million on $742.85 million of revenue during the prior year. The Troubled Company Reporter said on Nov. 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. HERCULES OFFSHORE: Bank Debt Trades at 1% Off in Secondary Market ----------------------------------------------------------------- Participations in a syndicated loan under which Hercules Offshore is a borrower traded in the secondary market at 99.02 cents-on- the-dollar during the week ended Friday, May 6, 2011, an increase of 0.66 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 650 basis points above LIBOR to borrow under the facility. The bank loan matures on July 11, 2013, and carries Moody's Caa1 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. Hercules Offshore, Inc., reported a net loss of $14.22 million on $166.24 million of revenue for the three months ended March 31, 2011, compared with a net loss of $15.95 million on $150.85 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $2.02 billion in total assets, $1.18 billion in total liabilities, and $839.03 million in stockholders' equity. 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 Company reported a net loss of $134.59 million on $657.48 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $91.73 million on $742.85 million of revenue during the prior year. The Troubled Company Reporter said on Nov. 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. HIGHVIEW POINT: Files for Chapter 11 Protection ----------------------------------------------- Highview Point Partners LLC, a Connecticut investment management firm focused on emerging markets, filed a bare-bones Chapter 11 petition (Bankr. D. Del. Case No. 11-11432) in Wilmington, Delaware, on May 6, 2011. Highview Point, based in Stamford, estimated as much as $500,000 in assets. Highview Point Offshore Ltd. and Highview Point Master Fund Ltd., both based in the Cayman Islands, and Highview Point LP in Stamford, are atop the list of 20 largest unsecured creditors. HIGHVIEW POINT: Case Summary & 13 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Highview Point Partners, LLC 1055 Washington Boulevard, 5th Floor Stamford, CT 06901 Tel: (203) 391-6720 Bankruptcy Case No.: 11-11432 Chapter 11 Petition Date: May 6, 2011 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Debtor's Counsel: David B. Stratton, Esq. PEPPER HAMILTON LLP Hercules Plaza, Suite 5100 1313 Market Street Wilmington, DE 19899-1709 Tel: (302) 777-6500 Fax: (302) 421-8390 E-mail: strattond@pepperlaw.com - and - Evelyn J. Meltzer, Esq. PEPPER HAMILTON LLP Hercules Plaza 1313 N. Market Street, Suite 5100 Wilmington, DE 19899 Tel: (302) 777-6500 Fax: (302) 421-8390 E-mail: meltzere@pepperlaw.com Debtor's Co-Counsel: MORRISON & FOERSTER, LLP APPLEBY Estimated Assets: $100,001 to $500,000 Estimated Debts: $100,000,001 to $500,000,001 The petition was signed by Frank H. Lopez, managing member. Debtor's List of 13 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Banco General Banca Privada Revenue Sharing $15,437 Ave. 5ta. B Sur Torre Banco General, Piso 18 Panama, Republic of Panama One Communications Service Contract $3,234 2150 Holmgren Way (Cancelled) Green Bay, WI 54304 Sadis & Goldberg LLP Legal $2,470 551 Fifth Avenue, 21st Floor New York, NY 10176 Victor Chong Employee $2,419 Belinda Pereira Employee $2,419 Danziger Markhoff LLP Legal $942 Reckson Operating Partnership Lease (Expenses) $722 Optimum Lightpath Service Contract $181 Cablevision Trade Debt $101 Verizon Wireless Service $12 Highview Point Offshore, Ltd. Investment Services unknown Highview Point, LP Investment Services unknown Highview Point Master Fund, Ltd. Investment Services unknown HOST HOTELS: S&P Gives 'BB+' Rating on $350MM Sr. Notes ------------------------------------------------------- Standard & Poor's Ratings Services assigned Bethesda, Md.-based Host Hotels & Resorts L.P.'s proposed $350 million senior notes due 2019 its 'BB+' issue-level rating (two notches higher than our 'BB-' corporate credit rating on the company). "We also assigned this debt a recovery rating of '1', indicating our expectation of very high (90% to 100%) recovery for lenders in the event of a payment default," S&P stated. The company will use proceeds from the proposed notes issuance to redeem all of the principle amount outstanding 7 1/8% series K notes due 2013, to repay $50 million in borrowings under its credit facility, and for general corporate purposes. "In addition, we affirmed all of our existing ratings on the company, including the 'BB-' corporate credit rating. The rating outlook is stable," S&P noted. "The rating on Host reflects its highly leveraged financial risk profile, reliance on external sources of capital for growth as a real estate investment trust (REIT), and the cyclical nature of the lodging industry," said Standard & Poor's credit analyst Emile Courtney. Additionally, although the rating and outlook have incorporated our view that Host would begin to deploy its large excess cash balances for hotel acquisitions and investments, the valuation multiples for its recently announced and completed acquisitions are somewhat higher than our original expectations. "We believe competition for high-quality assets in urban markets has driven acquisition multiples to an elevated level," added Mr. Courtney, "and Host's relatively aggressive posture, in our view, will limit a possible upgrade over the near term given the likelihood for a modest return on investment in that time frame." HOUSE OF PRAYER: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: House of Prayer for All People Ministries 1913 N. Wilmington Compton, CA 90222 Bankruptcy Case No.: 11-29410 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Vincent P. Zurzolo Debtor's Counsel: James M. Powell, Esq. LAW OFFICES OF JAMES M. POWELL 1894 Commercenter Dr W Ste 108 San Bernardino, CA 92408 Tel: (909) 890-0105 Fax: (909) 890-0106 E-mail: jpowellesq@gmail.com Scheduled Assets: $400,000 Scheduled Debts: $1,102,183 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Terri Michelle Givens, officer. HOWREY LLP: Wants Bankruptcy in DC, Not California -------------------------------------------------- Richard Vanderford at Bankruptcy Law360 reports that dissolved law firm Howrey LLP on Tuesday asked a California federal judge to toss an involuntary Chapter 7 bankruptcy brought against it, saying the case belongs in Washington or Virginia. Law360 relates that Howrey, drawn into California bankruptcy court by three creditors who claim they are owed about $36,600, said it makes no sense for its bankruptcy proceedings to take place in a venue thousands of miles from its home base in Washington. Dow Jones' DBR Small Cap relates that Howrey LLP said it is seeking to file a Chapter 11 petition and it would work to move the case east, where it's winding down its operations. Three creditors filed an involuntary Chapter 7 petition (Bankr. N.D. Calif. Case No. 11-31376) on April 11, 2011, against the remnants of the Washington-based law firm Howrey LLP. The filing was in San Francisco, where the firm had an office. The firm previously was known as Howrey & Simon and Howrey Simon Arnold & White LLP. The firm at one time had more than 700 lawyers in 17 offices. The partners voted to dissolve in March. The firm specialized in antitrust and intellectual-property matters. The three creditors filing the involuntary petition together have $36,600 in claims, according to their petition. The firm can defeat the petition by showing it is generally paying debts as they come due. The firm can also consent to bankruptcy and convert the case in Chapter 11, where the firm's management would remain in control, at least initially. HSRE-CDS I: GB HoldCo Seeks Dismissal of Chapter 11 Proceeding -------------------------------------------------------------- GB HoldCo LLC asks the U.S. Bankruptcy Court for the District of Delaware to dismiss the Chapter 11 case of HSRE-CDS I LLC. In the alternative, GB HoldCo seeks relief from the automatic stay. In addition, GB HoldCo seeks to prohibit the Debtor from using cash collateral. GB HoldCo is a secured creditor, as assignee of OREO Corporation, successor-in-interest to Keybank National Association under a certain Amended and Restated Loan Agreement dated Dec. 31, 2009. Norman L. Pernick, Esq., at Forman & Leonard P.A., in Wilmington, Delaware, points out that the Chapter 11 case is a classic two- party dispute, filed in bad faith to hinder and delay GB HoldCo's exercise of state law remedies regarding the Debtor's troubled assets. "This case was initiated one day before GB HoldCo was scheduled to realize on part of its collateral through a foreclosure sale, as the Debtor has been in default of its pre-petition loan for over a year," Mr. Pernick says. The Debtor has minimal unsecured trade debt amounting $6,276 and few employees and its sole source of income is the receipts derived from its real properties in Missouri and Louisiana, which are fully encumbered and subject to a present and absolute assignment of rents and income in GB HoldCo's favor, Mr. Pernick tells the Court. He asserts that the Debtor lacks any ownership interest in those rents and income and there is no operating income available to the Debtor to operate its business or fund any potential plan of reorganization. The Court will conduct a hearing on May 10, 2011 at 11:00 a.m. (ET) regarding GB HoldCo's Request. Objections are to be filed not later than May 3, 2011 at 4:00 p.m. (ET). Irving, Texas-based HSRE-CDS I, LLC, is a real estate company engaged in the acquisition, ownership, operation, management, leasing, financing, mortgaging and selling of real property. It is a partnership between campus-housing operator Collegiate Management Group and private equity firm Harrison Street Real Estate Capital LLC. HSRE-CDS I filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10972) on March 31, 2011. The Debtor has not had sufficient time to discuss with the new lender the terms and conditions to use any cash collateral. The bankruptcy case will allow the Debtor the breathing room to negotiate with the new lender about issues likely to be key in this case. R. Craig Martin, Esq., at DLA Piper LLP, serves as the Debtor's bankruptcy counsel. The Debtor disclosed assets of 1,256,241 plus unknown and liabilities of $22,878,499 as of the Chapter 11 filing. HSRE-CDS I: Section 341 Meeting of Creditors Set for May 10 ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware notifies parties-in-interest that there will be a meeting of creditors pursuant to Section 341 of the Bankruptcy Code on May 10, 2011 at 2:00 p.m. at the Court at 844 King Street, Room 5209, Wilmington, DE 19801. Cynthia E. Moh, Esq., at DLA Piper LLP, in Wilmington Delaware, the Debtor's counsel will be present. Irving, Texas-based HSRE-CDS I, LLC, is a real estate company engaged in the acquisition, ownership, operation, management, leasing, financing, mortgaging and selling of real property. It is a partnership between campus-housing operator Collegiate Management Group and private equity firm Harrison Street Real Estate Capital LLC. HSRE-CDS I filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10972) on March 31, 2011. The Debtor has not had sufficient time to discuss with the new lender the terms and conditions to use any cash collateral. The bankruptcy case will allow the Debtor the breathing room to negotiate with the new lender about issues likely to be key in this case. R. Craig Martin, Esq., at DLA Piper LLP, serves as the Debtor's bankruptcy counsel. The Debtor disclosed assets of 1,256,241 plus unknown and liabilities of $22,878,499 as of the Chapter 11 filing. HSRE-CDS I: Files Schedules of Assets and Liabilities ----------------------------------------------------- HSRE-CDS I LLC filed with the U.S. Bankruptcy Court for the District of Delaware, its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property unknown B. Personal Property $1,256,241 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $22,790,609 E. Creditors Holding Unsecured Priority Claims $5,573 F. Creditors Holding Unsecured Non-priority Claims $82,316 ----------- ----------- TOTAL $1,256,241 $22,878,499 Irving, Texas-based HSRE-CDS I, LLC, is a real estate company engaged in the acquisition, ownership, operation, management, leasing, financing, mortgaging and selling of real property. It is a partnership between campus-housing operator Collegiate Management Group and private equity firm Harrison Street Real Estate Capital LLC. HSRE-CDS I filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10972) on March 31, 2011. The Debtor has not had sufficient time to discuss with the new lender the terms and conditions to use any cash collateral. The bankruptcy case will allow the Debtor the breathing room to negotiate with the new lender about issues likely to be key in this case. R. Craig Martin, Esq., at DLA Piper LLP, serves as the Debtor's bankruptcy counsel. The Debtor disclosed assets of 1,256,241 plus unknown and liabilities of $22,878,499 as of the Chapter 11 filing. INTEGRA BANK: Judge Trockman Resigns from Board of Directors ------------------------------------------------------------ Judge Wayne S. Trockman, a director of Integra Bank Corporation since 2010, notified the Company's Board of Directors that he was resigning from the Board effective immediately. Judge Trockman served as a member of the Audit and Compensation committees, which are joint committees of the Board of Directors of the Company and Integra Bank N.A., the Company's principal subsidiary. Judge Trockman also served on the Wealth Management committee of the Board of Directors of Integra Bank N.A. About Integra Headquartered in Evansville, Indiana, Integra Bank Corporation (Nasdaq:IBNK) -- http://www.integrabank.com/-- is the parent of Integra Bank N.A. As of Dec. 31, 2010, Integra Bank has $2.4 billion in total assets. Integra Bank currently operates 52 banking centers and 100 ATMs at locations in Indiana, Kentucky, and Illinois. In Integra Bank's annual report on Form 10-K for the fiscal year ended Dec. 31, 2010, Crowe Horwath LLP, in Louisville, Kentucky, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company's cumulative net loss to common shareholders from 2008 through 2010 exceeded $430 million and the Company has negative shareholders' equity at Dec. 31, 2010. "These results are primarily due to asset impairments, particularly loans. The Company cannot currently generate sufficient revenue to support its operating expenses and the Company's bank subsidiary has not been able to achieve the capital levels required by regulatory order. The Company's balance sheet at March 31, 2011 showed $2.17 billion in total assets, $2.24 billion in total liabilities and a $65.07 million total shareholders' deficit. INTERPUBLIC GROUP: Fitch Affirms Preferred Stock at 'BB+' --------------------------------------------------------- Fitch Ratings has affirmed the ratings on the Interpublic Group of Companies, Inc., including its Issuer Default Rating at 'BBB'. The Rating Outlook is Stable. Rating Rationale: -- IPG's rating reflects its position in the industry as one of the largest global advertising holding companies, its diverse client base, and the company's ample liquidity. -- Fitch expects IPG to continue to deliver competitive organic revenue growth and is in a good position to continue to grow its EBITDA margins and reach competitive levels over the next few years. -- The ratings reflect Fitch's expectation that IPG will manage unadjusted gross leverage at a level below 2.5 times (x). Fitch calculates the first quarter of 2011 (1Q'11) unadjusted gross leverage at 2.3x. -- The rating incorporates Fitch's belief that the company will deploy cash towards acquisitions, dividends, and share repurchases. Fitch believes this activity will be executed prudently without negatively affecting the rating. -- While cash balances of $1.8 billion make liquidity solid, Fitch notes that under more normalized conditions, prior to its financial reporting and operational issues, IPG retained cash in excess of seasonal working-capital swings. Cash balances were typically between $500 million and $1 billion. The ratings incorporate the expectation that current cash balances will decline over time. However, Fitch expects IPG to maintain sufficient liquidity to handle seasonal working- capital swings. -- While advertising is a cyclical industry, Fitch recognizes IPG and its global advertising agency holding companies (GHC) peers have reduced exposure to U.S. advertising cycles, by diversifying into international markets and marketing services businesses. In addition, the risk of revenue cyclicality is balanced by the scalable cost structures of IPG and the other GHCs. Key Rating Drivers: -- A public commitment by the company to maintain gross unadjusted leverage below 2.0x coupled with peer level revenue growth and competitive EBITDA margins could warrant upgrade consideration. -- There is tolerance in the rating for unadjusted gross leverage to go slightly above the 2.5x for a brief period (six to 12 months) as a result of an acquisition. -- Debt funded share buy back activity that drove leverage to 2.5x could pressure the ratings. -- An unexpected near-term reversal in operating trends that pushed metrics below their current levels for a protracted period of time could pressure the ratings. -- While Fitch is comfortable with management's willingness and ability to maintain its 'BBB' rating, a change in the company's posture toward maintaining adequate bondholder protection over the near and long term could affect the rating negatively. Solid Free Cash Flow: As of the last 12 months (LTM) ended March 31, 2011, IPG generated approximately $427 million in free cash flow (FCF), converting a meaningful percentage (55%) of EBITDA to FCF, a higher percentage than Fitch would expect over the long term (30%-50%). Under Fitch's base case model, FCF is expected to be positive at approximately $400-450 million in 2011. In 2010, the company spent $96 million, or 1.5% of revenue, on capital expenditures (excluding equipment rents) reflecting the low capital intensity of the advertising agency business. Fitch believes the company will increase capital spending over the next few years with expectations between 1.5-2% of revenues. As demonstrated in the past, Fitch believes that expenditures are largely discretionary on the part of management and could be reduced during periods of operating pressure. As of Dec. 31, 2010, the company's worldwide pension programs were $157 million underfunded. Fitch believes future pension contributions will be manageable and are incorporated into Fitch's FCF forecast. Liquidity: Fitch expects IPG to have the liquidity and financial flexibility to cover earn-outs, a modest level of acquisitions (Fitch has modeled $150-$250 million), share repurchases, and the liquidity to satisfy any notes put to the company for redemption. As of March 31, 2011, IPG's liquidity position is supported by $1.8 billion in cash. The company's bank credit facility due 2013 provides $650 million in capacity and has $634 million in availability (reduced by the March 2011 letters of credit balance of $16 million). The $650 million bank credit facility contains three key covenants (minimum EBITDA, leverage ratio and interest coverage). Fitch expects that IPG will not have issues in meeting its financial covenants, as EBITDA is expected to improve from its cyclical lows. As of 1Q'11 near-term maturities include: -- $36 million in senior notes due Aug. 15, 2011; -- $400 million in convertible notes that may be put to IPG in 2012; -- $200 million in convertible notes that may be put to IPG in 2013; -- $350 million in senior notes due 2014. IPG also maintains uncommitted credit facilities to fund working capital needs outside the U.S. The available capacity under these uncommitted facilities is not factored into Fitch's liquidity considerations. Leverage Falls Below 2.5x: Unadjusted gross leverage as of March 31, 2011 was 2.3x (unadjusted gross leverage [using the NPV lease method] at approximately 2.5x), an improvement from 3.2x (adjusted gross leverage at 3.3x) at year-end 2009. Positive Growth Momentum Organic revenue growth has been positive over the last four quarters (8.5% in 2Q'10, 9.4% in 3Q'10, 11.2% in 4Q'10, and 9.3% in 1Q'11), and Fitch calculated EBITDA margins at 11.5%, as of LTM March 31, 2011. The current rating reflects Fitch's belief that revenues will continue to grow at a more normalized level (3% to 5%), and EBITDA margins will continue to expand, as the company leverages its existing infrastructure. Fitch has affirmed these ratings: IPG -- IDR at 'BBB'; -- Senior unsecured notes (including convertibles) at 'BBB'; -- Bank credit facility to 'BBB'; -- Cumulative convertible perpetual preferred stock at 'BB+'. ISLAND ONE: Wins Confirmation of Reorganization Plan ---------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Island One Inc. persuaded the bankruptcy judge in Orlando, Florida, at a hearing on May 4 to sign a confirmation order approving the reorganization plan. In return for $13 million, a group formerly associated with Bay Harbour Management LC bought the equity. The plan provides for different treatment for the secured lenders and unsecured creditors at each of the properties. At the outset of the case, Island One said in a court filing that Bay Harbour was negotiating to buy the company. Secured creditor Textron Financial Corp. was owed $99.1 million. Branch Banking & Trust Co. had a $39.1 million secured claim. Liberty Bank was a secured creditor originally listed as being owed $7.9 million. About Island One Orlando, Florida-based Island One, Inc., is the developer and operator of 10 timeshare vacation communities in Florida and the Virgin Islands. Island One filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 10-16177) on Sept. 10, 2010. Tiffany D. Payne, Esq., Elizabeth A. Green, Esq., and Jimmy D. Parrish, Esq., at Baker & Hostetler LLP, in Orlando Fla., represent the Debtors as counsel. In its schedules, the Debtor disclosed $155,100,767 in assets and $310,897,452 in liabilities. IOI Funding I, LLC, a debtor-affiliate, filed for Chapter 11 bankruptcy protection on Sept. 10, 2010 (Bankr. M.D. Fla. Case No. 10-16189). The Debtor disclosed total assets of $9,230,309, and total liabilities of $7,265,160. The Official Committee of Unsecured Creditors in the Chapter 11 cases of Island One, Inc. has tapped Adam Lawton Alpert, Esq., a shareholder, and Bush Ross, P.A. as its general counsel. KANSAS CITY SOUTHERN: Moody's Hikes CFR to 'B1' on Revenue Growth ----------------------------------------------------------------- Moody's Investors Service has upgraded the ratings of Kansas City Southern de Mexico, S.A. de C.V., corporate family rating to Ba3 from B1. The ratings outlook for KCSM is positive. KCSM's ratings were upgraded in recognition of the substantial revenue and yield growth that the company is demonstrating in the recovering economic environment, particularly in light of higher growth in the Mexican industrial sectors. KCMS's margins have improved dramatically over the past two years, and operating ratios (essentially, 1-operating margins) are now below 70%, which is on par with many of the larger Class I railroads. Because of this improvement in profitability, and aided by a modest amount of debt reduction recently, KCSM's credit metrics have improved to levels that map well to Ba3-rated entities. LTM March 2011 Debt to EBITDA was approximately 3.1 times, and EBIT to Interest was 2.4 times. These measures now compare favorably with those of KCSM sister railroad in the U.S., Kansas City Southern Railway (KCSR), which is rated Ba3. Moody's expects that, with continued steady volume growth in a strong pricing environment, these metrics will continue to improve through 2011. The positive outlook for KCSM reflects Moody's expectations that the company will continue to see steady revenue growth over the near term at improving margins, which will result in improved earnings and positive free cash flow over this period. This could result in credit metrics that are supportive of higher ratings at KCSM. Moody's anticipates that such an outcome could be achieved even under a slow macroeconomic growth scenario in North America. Ratings at KCSM could be upgraded if its railroad operations were to show steady and sustained growth in yield and volume the next 6-12 months without any material deterioration in service metrics. The railroad would have to demonstrate a continuous track record of strong positive free cash flow generation while maintaining capital investments at current levels. Operating ratios would need to trend below 70% throughout 2011 to warrant upward rating consideration, with Debt/EBITDA sustained below 3.0 times and EBIT/Interest above 3.5 times. Conversely, ratings KCSM could face downward revision if operating conditions were to weaken to a point that Debt/EBITDA exceeds 4.0 times, if EBIT/Interest falls below 2.0 times, or if deterioration in liquidity becomes a constraint on either company's operating or investing activities. Upgrades: Issuer: Kansas City Southern de Mexico, S.A. de C.V. -- Corporate Family Rating, Upgraded to Ba3 from B1 -- Senior Secured Bank Credit Facility, Upgraded to Ba2 from Ba3 -- Senior Unsecured Regular Bond/Debenture, Upgraded to Ba3 from B1 The principal methodology used in rating Kansas City Southern de Mexico, S.A. de C.V. was the Global Freight Railroad Industry Methodology, published March 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Kansas City Southern de Mexico, S.A. de C.V., a wholly-owned subsidiary of U.S. holding company Kansas City Southern, owns the concession to operate Mexico's northeastern railroad. KT SPEARS: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: KT Spears Creek, LLC 5410 Piping Rock Houston, TX 77056 Bankruptcy Case No.: 11-33991 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Letitia Z. Paul Debtor's Counsel: Magdalene Duchamp Conner, Esq. OKIN ADAMS & KILMER LLP 1113 Vine Street, Suite 201 Houston, TX 77002 Tel: (713) 228-4100 Fax: (888) 865-2118 E-mail: mconner@oakllp.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Kyle D. Tauch, sole member. The Debtor did not file its list of largest unsecured creditors when it filed its petition. LABELCORP HOLDINGS: $100MM 2nd Lien Facility Gets Moody's 'Caa1' ---------------------------------------------------------------- Moody's Investors Service has assigned a Ba3 rating to LabelCorp Holdings, Inc.'s proposed $175 million first lien senior secured credit facilities and a Caa1 rating to the proposed $100 million second lien senior secured credit facility. All other ratings, including the B2 corporate family rating (CFR), were affirmed. The ratings outlook was revised to stable from negative reflecting the company's improved operating performance, financial leverage and liquidity coupled with Moody's expectation that these trends will continue throughout 2011. Proceeds from the proposed facilities are expected to be used to refinance York's existing debt and pay related transaction fees. The ratings on the existing credit facilities will be withdrawn upon completion of the proposed refinancing. These ratings have been assigned for LabelCorp Holdings, Inc. subject to review of final documentation: -- Ba3 (LGD3, 31%) to the $25 million first lien senior secured revolving credit facility due 2016; -- Ba3 (LGD3, 31%) to the $150 million first lien senior secured term loan due 2017; and -- Caa1 (LGD5, 84%) to the $100 million second lien senior secured term loan due 2017. These ratings have been affirmed for LabelCorp Holdings, Inc.: -- B2 corporate family rating; and -- B2 probability of default rating. RATINGS RATIONALE The B2 CFR and stable rating outlook reflect the recent improvement in York Label's operating performance, its declining, though high financial leverage and the expectation for increased revolver availability and covenant headroom following the refinancing. Moody's expects the company's ramp up of recent business wins, continued cost reductions and focus on more profitable customers to support growth in 2011. Recent wins with new and existing customers in its core consumer products, food & beverage and wine & spirits segments are expected to build on 2010 earnings momentum. The B2 corporate family rating is currently constrained by York Label's weak credit metrics, particularly its high leverage of 6.0x and interest coverage of 1.2x as of Dec. 31, 2010, prior to the inclusion of its earnings from its 50% owned Chilean joint venture. The rating also reflects the company's leading position within the fragmented North American premium, prime label market. While overall customer concentration is relatively high, the ratings are supported by its exposure across a wide range of brands and the long-standing relationships at its key customers as well as its scale relative to other industry participants. The ratings on the first lien facilities reflect their senior position in the capital structure which benefit from a first lien on substantially all assets, the capital stock of each domestic subsidiary and 65% of the capital stock of each first-tier foreign subsidiary. These ratings could be lowered to B1 if the amount of first lien obligations were to proportionally increase relative to second lien debt prior to close of the facilities. The ratings could be downgraded if York Label were to lose a major customer or see a deterioration in operating performance prior to further deleveraging. Additionally, ratings pressure could arise if debt-to-EBITDA were to remain above 6.0x for an extended period of time. While a rating upgrade is not anticipated in the near term, continued increase in operating performance leading to a sustained improvement in credit metrics, specifically debt-to- EBITDA of less than 4.5x, free cash flow to debt in high single digits, and interest coverage approaching 2.0x would be viewed positively. The principal methodology used in rating LabelCorp Holdings, Inc. was the Global Heavy Manufacturing Rating Methodology, published November 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Moody's last rating action on York occurred on Sept. 8, 2009 when Moody's revised the outlook to negative from stable and affirmed all other ratings. Headquartered in Omaha, Nebraska, LabelCorp Holdings, Inc., which operates as York Label, Inc., manufactures prime, pressure sensitive labels for the food, beverage, consumer products, wine and spirits and healthcare industries located in North and South America. York focuses mainly on its four core segments: consumer products (32% of revenue), food and beverage (32% of revenue), wine and spirits (21% of revenue) and healthcare (7% of revenue). York has been a portfolio company of Diamond Castle Holdings, LLC since August 2008. Revenue for the twelve months ended Dec. 31, 2010 was approximately $200 million. LAM RESEARCH: S&P Rates $800MM Sr. Unsecured Notes 'BB+' -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' rating to Fremont, Calif.-based Lam Research Corp.'s (BB+/Positive/--) aggregate issuance of up to $800 million senior unsecured convertible notes. "We also assigned a recovery rating of '3' to the debt, indicating our expectation for meaningful (50%-70%) recovery of principal in the event of default. Although the estimated numerical recovery is in the 90%-100% range, we have capped the recovery rating at '3' because of the recovery rating cap on unsecured debt of issuers in the 'BB' category," S&P related. The company will issue the notes in two tranches, with one due in May of 2016 and the other in May of 2018. The company intends to use the proceeds to repurchase up to 3 million of common shares as well as engage in various hedging transactions and for general corporate purposes. "Our 'BB+' corporate credit rating on Lam already incorporates the expectation that the company could add incremental debt, and does not affect our assessment of Lam's financial risk profile as intermediate. Given the high cash flow volatility, as our ratings incorporate the expectation that operating lease-adjusted leverage will remain below 3x through most industry cycles. After this transaction, leverage is likely to be in the 1x area up from about 0.1x as of Lam's March 2011 quarter," S&P stated. Ratings List Lam Research Corp. Corporate Credit Rating BB+/Stable/-- New Rating Lam Research Corp. Senior Unsecured Convertible nts BB+ Recovery Rating 3 LEE ENTERPRISES: Incurs $1.45 Million Net Loss in March 27 Qtr. --------------------------------------------------------------- Lee Enterprises, Incorporated, reported a net loss of $1.45 million on $178.72 million of total operating revenue for the 13 weeks ended March 27, 2011, compared with net income of $2.98 million on $185.74 million of total operating revenue for the 13 weeks ended March 28, 2010. The Company also reported net income of $17.53 million on $386.39 million of total operating revenue for the 26 weeks ended March 27, 2011, compared with net income of $30.94 million on $395.58 million of total operating revenue for the 26 weeks ended March 28, 2010. The Company's selected balance sheet information at March 27, 2011 showed $24.89 million in cash, $5.10 million in restricted cash and investments and $1.02 billion in debt. Mary Junck, chairman and chief executive officer, said: "While the upward progress in the overall business climate cooled noticeably this past quarter, we expect year over year revenue comparisons to improve again as economic conditions in our markets also improve. We believe results for the March quarter were adversely impacted by the timing of the Easter holiday, as we have historically experienced an increase in advertising revenue in the weeks preceding that holiday." A full-text copy of the press release announcing the financial results is available for free at http://is.gd/CZ1uGy About Lee Enterprises Based in Davenport, Iowa, Lee Enterprises, Incorporated -- http://www.lee.net/-- is a premier provider of local news, information and advertising in primarily midsize markets, with 49 daily newspapers and a joint interest in four others, rapidly growing online sites and more than 300 weekly newspapers and specialty publications in 23 states. Lee's newspapers have circulation of 1.5 million daily and 1.8 million Sunday, reaching four million readers daily. Lee stock is traded on the New York Stock Exchange under the symbol LEE. * * * As reported by the Troubled Company Reporter on April 14, 2011, Standard & Poor's Ratings Services Lee Enterprises its preliminary 'B' corporate credit rating. S&P also said, "At the same time, we assigned our preliminary 'B' rating (the same as the corporate credit rating) to the company's offering of $675 million first- priority lien senior secured notes due 2017 with a preliminary recovery rating of '3', indicating our expectation of meaningful (50%-70%) recovery for lenders in the event of a payment default. We also rated the company's second-priority lien senior secured notes due 2018 a preliminary 'CCC+', with a preliminary recovery rating of '6', indicating negligible (0%-10%) recovery for lenders." The TCR on April 13, 2011, said Moody's Investors Service assigned first time ratings to Lee Enterprises, including a Caa1 Corporate Family Rating (CFR), Caa1 Probability of Default Rating (PDR) and SGL-3 speculative-grade liquidity rating. Moody's also assigned a B1 rating to the company's proposed $50 million 5-year senior secured first-lien first-out revolver, a B3 rating to its proposed $675 million senior secured first-lien notes maturing 2017, and a Caa2 rating to its proposed $375 million senior secured second- lien notes maturing 2018. The rating outlook is stable. LEE ENTERPRISES: Withdraws Offerings of Sr. Notes & Common Stock ---------------------------------------------------------------- Lee Enterprises, Incorporated, announced that, as a result of market conditions, it has decided not to proceed with plans to privately offer $680 million of first priority lien senior secured notes due in 2017, $375 million of second priority lien senior secured notes due in 2018 and up to 8,928,175 shares of Lee Common Stock. Mary Junck, chairman and chief executive officer, said: "Although we were pleased with investor interest, the proposed offerings did not result in terms and conditions that met our expectations or recognize the future value we expect for Lee stockholders. Refinancing our Credit Agreement and the Pulitzer Notes debt is among our highest priorities. We will continue to pursue alternatives and intend to refinance our long-term debt before it matures in April 2012." About Lee Enterprises Based in Davenport, Iowa, Lee Enterprises, Incorporated -- http://www.lee.net/-- is a premier provider of local news, information and advertising in primarily midsize markets, with 49 daily newspapers and a joint interest in four others, rapidly growing online sites and more than 300 weekly newspapers and specialty publications in 23 states. Lee's newspapers have circulation of 1.5 million daily and 1.8 million Sunday, reaching four million readers daily. Lee stock is traded on the New York Stock Exchange under the symbol LEE. * * * As reported by the Troubled Company Reporter on April 14, 2011, Standard & Poor's Ratings Services Lee Enterprises its preliminary 'B' corporate credit rating. S&P also said, "At the same time, we assigned our preliminary 'B' rating (the same as the corporate credit rating) to the company's offering of $675 million first- priority lien senior secured notes due 2017 with a preliminary recovery rating of '3', indicating our expectation of meaningful (50%-70%) recovery for lenders in the event of a payment default. We also rated the company's second-priority lien senior secured notes due 2018 a preliminary 'CCC+', with a preliminary recovery rating of '6', indicating negligible (0%-10%) recovery for lenders." The TCR on April 13, 2011, said Moody's Investors Service assigned first time ratings to Lee Enterprises, including a Caa1 Corporate Family Rating (CFR), Caa1 Probability of Default Rating (PDR) and SGL-3 speculative-grade liquidity rating. Moody's also assigned a B1 rating to the company's proposed $50 million 5-year senior secured first-lien first-out revolver, a B3 rating to its proposed $675 million senior secured first-lien notes maturing 2017, and a Caa2 rating to its proposed $375 million senior secured second- lien notes maturing 2018. The rating outlook is stable. LEVEL 3: Incurs $205 Million Net Loss in March 31 Quarter --------------------------------------------------------- Level 3 Communications, Inc., reported a net loss of $205 million on $929 million of total revenue for the three months ended March 31, 2011, compared with a net loss of $238 million on $910 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $8.80 billion in total assets, $9.06 billion in total liabilities and a $265 million stockholders' deficit. "We are pleased to report a solid quarter, giving us a strong start to 2011," said James Q. Crowe, CEO of Level 3. "We see many opportunities across our customer base to continue growing our business throughout the year. Our customers require more and more bandwidth to support the continued adoption of video over the Internet, the continued growth in wireless broadband, and the rising demand for bandwidth in the enterprise market. Our mix of network assets, our service capabilities and our focus on customer service excellence are making Level 3 a top choice for wholesale and enterprise customers in the U.S. and Europe." A full-text copy of the press release announcing the financial results is available for free at http://is.gd/DuqFCr About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. LIMITED BRANDS: Moody's Says Repurchase Program Won't Affect 'Ba1' ------------------------------------------------------------------ Moody's Investors Service stated that Limited Brands' announcement that it had authorized an additional $500 million share repurchase program has no immediate impact on either the Ba1 Corporate Family Rating or stable outlook. "We had expected Limited Brands to use the proceeds of its recent $1 billion note offering to fund further share repurchases," stated Moody's Senior Credit Officer Maggie Taylor. "Despite the increase in debt, Moody's believes Limited Brands will maintain healthy credit metrics due to its continued very strong operating performance," Taylor added. The principal methodology used in rating Limited Brands was the Global Retail Industry Methodology, published in December 2006. Other methodologies used include Loss Given Default for Speculative Grade Issuers in The US, Canada, EMEA, published in June 2009. Headquartered in Columbus, Ohio, Limited Brands, Inc. operates over 2,900 specialty stores under the Victoria's Secret, Bath & Body Works, C.O. Bigelow, Pink, La Senza, White Barn Candle Co., and Henri Bendel name plates. The company's products are also available on-line. Annual revenues are about $9.6 billion. LITHIUM TECHNOLOGY: Appoints Martin Koster as President and COO --------------------------------------------------------------- Lithium Technology Corporation, Inc., announced that Martin Koster is joining the management team as LTC's President and Chief Operating Officer. In addition to his daily operational responsibilities at LTC, Mr. Koster will focus on the implementation of the strategic development opportunities of LTC and the company's transition into a volume manufacturer of its leading large-format Lithium based battery technology, including the integration of its battery technology with the electronics capabilities of LTC's strategic partner, Frazer-Nash Research Ltd., through the previously announced strategic alliance between the two companies. Martin Koster is a German national with a strong background in working with companies in the automotive and industrial sector. His focus in his prior roles as a corporate finance and M&A advisor was on global automotive sector clients of all sizes, including leading passenger and commercial vehicle manufacturers and their suppliers. Mr. Koster joins LTC from Goetzpartners, a European-based investment banking firm, where he was head of the London office and during his tenure there, was appointed an Executive Board Member. Prior to his association with Goetzpartners, Mr. Koster spent eleven years at Citigroup primarily on the automotive and industrials team, based in Frankfurt and London. LTC's Co-Chairman, Fred Mulder, and CEO, Theo Kremers, jointly commented on Mr. Koster's appointment: "We are pleased to welcome Martin onto the team. LTC will benefit from his experience with automotive and industrial sector companies in the strategic development of LTC's business with such companies as well as the strengthening of LTC's daily management. We wish him all the best in his transition to his new role at LTC." About Lithium Technology Plymouth Meeting, Pa.-based Lithium Technology Corporation is a mid-volume production stage company that develops large format lithium-ion rechargeable batteries to be used as a new power source for emerging applications in the automotive, stationary power, and national security markets. The Company reported a net loss of $7.25 million on $6.35 million of products and services sales for the year ended Dec. 31, 2010, compared with a net loss of $10.51 million on $7.37 million of product and services sales during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $10.78 million in total assets, $34.16 million in total liabilities and $23.38 million in total stockholders' deficit. Amper, Politziner & Mattia, LLP, Edison, New Jersey, noted that the Company has recurring losses from operations since inception and has a working capital deficiency that raise substantial doubt about its ability to continue as a going concern. $7 Mil. Funding Needed As reported by the TCR on April 8, 2011, the Company entered into a number of financing transactions and is continuing to seek other financing initiatives. The Company said it will need to raise additional capital to meet its working capital needs and to complete its product commercialization process. Such capital is expected to come from the sale of securities and debt financing. The Company believes that if it raises approximately $7 million in debt and equity financings, the Company would have sufficient funds to meet its needs for working capital and capital expenditures and to meet expansion plans during 2011. If the Company is not able to raise such additional capital, the Company will assess all available alternatives including a sale of the Company's assets or merger, the suspension of operations and possibly liquidation, auction, bankruptcy, or other measures. LK LAND: Case Summary & 2 Largest Unsecured Creditors ----------------------------------------------------- Debtor: LK Land Trust 981 Highway 98 East, Suite 3 Destin, FL 32541-12525 Bankruptcy Case No.: 11-30766 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Northern District of Florida (Pensacola) Debtor's Counsel: John R. Dowd, Jr., Esq. DOWD LAW FIRM 108 S.E. Eglin Parkway Fort Walton Beach, FL 32548 Tel: (850) 650-2202 Fax: (850) 650-5808 E-mail: john.dowd@cox.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flnb11-30766.pdf The petition was signed by Lowell B. Kelly, managing member of Trustee. LNR PROPERTY: Moody's Raises CFR to 'Ba2' on Bank Debt Refinancing ------------------------------------------------------------------ Moody's Investors Service upgraded LNR Property LLC's corporate family rating to Ba2 from B2 following its successful refinancing of its senior secured bank credit facility and affirmed the Ba2 rating of its new $365 million senior secured bank credit facility. The rating outlook is stable. RATINGS RATIONALE This rating action reflects the resolution of LNR's 2011 debt maturity and improved credit metrics following its recapitalization in August 2010. Debt maturities have been extended, intermediate term liquidity is strong, and cash flow is improving. LNR is now well-positioned to re-focus on growing its special servicing platform and funds businesses. The rating also reflects the uncertainty surrounding a definitive business plan, specifically whether LNR re-enters its traditional lines of businesses, which may include loan origination and on-balance sheet real estate investments. Moody's expects LNR to fund its growth primarily with free cash flow. Moody's notes that LNR now has the financial flexibility to absorb any negative pressure it might experience in operating performance given its strengthened capital structure. Moody's indicated that upward rating movement would be predicated upon more clarity surrounding LNR's long term business model, success in profitably growing its servicing and funds management businesses, and maintenance of a conservative capital structure consistent with the quality and liquidity of its assets. A downgrade could result if LNR has difficulty in growing its business or adopts a more aggressive, or less transparent, capital structure. This rating was upgraded with a stable outlook: -- LNR Property LLC -- corporate family rating to Ba2 from B2 This rating was affirmed with a stable outlook: -- LNR Property LLC -- senior secured credit facilities at Ba2 LNR Property LLC's ratings were assigned by evaluating factors Moody's believes are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against the issuers both within and outside of LNR's core industry and the company's ratings are believed to be comparable to those of other issuers of similar credit risk. Other methodologies and factors that may have been considered in the process of rating LNR Property LLC can also be found in the Rating Methodologies sub-directory on Moody's web site. LNR Property LLC is a real estate investment and management company headquartered in Miami Beach, Florida, USA. LOOP CORP: Sec. 341 Creditors' Meeting Set for June 7 ----------------------------------------------------- The United States Trustee for the Northern District of Illinois will convene a meeting of creditors in the bankruptcy case of Loop Corp. on June 7, 2011 at 1:30 p.m. at 219 South Dearborn, Office of the U.S. Trustee, 8th Floor, Room 802, in Chicago. Last day to object to dischargeability is Aug. 8, 2011. Loop Corp. in Chicago, Illinois, filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 11-17917) on April 27, 2011, Judge Bruce W. Black presiding. John M. Holowach, Esq., at Holowach & Pukshansky LLC, serves as bankruptcy counsel. The Debtor scheduled assets of $76,500,000 and debts of $33,030,231. LOS GATOS HOTEL: Plan Filing Exclusivity Extended to July 25 ------------------------------------------------------------ Los Gatos Hotel Corporation has sought and obtained a court order extending the period by which it has the exclusive right to file a Chapter 11 plan to July 25, 2011 and solicit acceptances of that plan to Sept. 26, 2011. About Los Gatos Hotel Los Gatos Hotel Corporation owns the Hotel Los Gatos, a Joie de Vivre Hotel. San Jose, California-based Los Gatos Hotel Corp. was formed in 2000 to build and operate Hotel Los Gatos, a full- service boutique hotel in downtown Los Gatos, California. Los Gatos Hotel filed for Chapter 11 bankruptcy protection (Bankr. N.D. Calif. Case No. 10-63135) on Dec. 27, 2010. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliate Blossom Valley Investors, Inc., filed a separate Chapter 11 petition (Bankr. N.D. Calif. Case No. 09-57669) on Sept. 10, 2009. Jeffry A. Davis, Esq., at Mintz Levin Cohn Ferris Glovsky Popeo, serves as the Debtors' bankruptcy counsel. MANITOWOC COMPANY: Moody's Affirms B2 CFR; Credit Facility at Ba2 ----------------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to Manitowoc's senior secured credit facility comprised of $500 million revolver, a $300 million term loan A, and a $350 million term loan B. Manitowoc's SGL-3 speculative grade liquidity rating remains unchanged. Concurrently, Moody has affirmed the company's B2 corporate family rating (CFR), and probability of default rating (PDR). These newly-rated bank facilities will refinance similar existing facilities. Upon the close of the transaction, the ratings of the refaced facilities will be withdrawn. Assignments: Issuer: Manitowoc Company, Inc. (The) -- Senior Secured Revolver, Assigned Ba2, LGD2-20% -- Senior Secured Term Loan A, Assigned Ba2, LGD2-20% -- Senior Secured Term Loan B, Assigned Ba2, LGD2-20% Adjustments: Issuer: Manitowoc Company, Inc. (The) -- Senior Unsecured Regular Bond/Debenture, LGD-5 75% changed to LGD5-74% The rating outlook is stable. RATINGS RATIONALE The Ba2 rating assignments to the company's new credit facilities reflect their senior secured status, subsidiary guarantees, and the significant amount of unsecured debt in the company's capital structure. The affirmation of the B2 CFR and PDR considers the expectation for improving operating and financial performance for both its crane operations and its food service business and considers the benefits of extending its debt maturities through proposed financing. However, the ratings primarily reflect the belief that Manitowoc's leverage will likely remain at an elevated level for the rating category for at least the next year and is therefore unlikely to warrant the consideration of a higher rating over the short term. The CFR and PDR ratings benefit from significant business diversity and international diversification. The ratings and/or outlook could be downgraded if EBITA/interest expense or Debt to EBITDA materially weakened from current levels over the next few quarters or if Debt to EBITDA was not expected to decline by at least half a turn by the end of 2011 from year end 2010's level. For 2010, EBITA/interest was 1.2x while debt/EBITDA was 6.8 times as adjusted by Moody's. Were the company to experience meaningful tightness under its covenants, the rating and/or outlook could be adversely affected. The rating outlook could be changed to positive if leverage was expected to improve to under 4.5x in the next twelve months on a sustainable basis. EBITA coverage of interest of over 2 times that was deemed to be improving would also support positive ratings traction. A meaningful rebound in the domestic construction market would also be supportive of positive ratings action particularly if its large international operations are performing strongly. The principal methodology used in rating Manitowoc Company Inc. was the Global Manufacturing Industry Methodology, published December 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. The Manitowoc Company, Inc., headquartered in Manitowoc, WI, is a diversified global manufacturer supporting the construction and foodservice end markets. Revenues for 2010 were approximately $3.1 billion. MASTEC INC: Moody's Affirms Ba3 Corporate Family Rating ------------------------------------------------------- Moody's Investors Service affirmed MasTec, Inc.'s Ba3 corporate family rating, Ba3 probability of default rating, and the B1 rating on its $150 million senior unsecured notes due 2017. The ratings outlook was revised to positive from stable. Moody's also assigned an SGL-2 speculative grade liquidity rating. Ratings affirmed: -- Corporate family rating at Ba3; -- Probability of default rating at Ba3; -- $150 million 7.625% senior unsecured notes due 2017 at B1 (LGD4, 67%). Point estimate revised from (LGD4, 68%). Rating assigned: Speculative grade liquidity rating at SGL-2. RATINGS RATIONALE The outlook revision reflects MasTec's favorable organic growth trends driven by strength in the bulk of its end-markets, and improvements in profitability that have translated into stronger credit metrics in recent periods, and Moody's expectation that these improvements will be sustained. The Ba3 corporate family rating reflects MasTec's established position as a relatively large-sized specialty contractor, moderate financial leverage with debt to EBITDA below 3.0 times, generally improving operating margins, a high proportion of revenues derived from repetitive/contractual work, strong organic growth in recent periods, and favorable long-term demand fundamentals within many of the industries it serves. However, the rating also considers the company's material concentration of sales from two customers, increased exposure to more volatile construction-oriented activities, ongoing acquisition risk, and the prospects for weaker cash flow as cash taxes increase. Moody's could upgrade MasTec's ratings if it maintains organic growth trends and sustains or modestly improves its operating margins while avoiding large-scale debt financed acquisitions such that debt to EBITDA remains below 3.0 times and EBITA to interest is about 3.5 times. Moody's could revise the ratings outlook to stable if MasTec's end-markets weaken and/or debt levels increase, potentially due to acquisition activity, such that debt to EBITDA increases above 3.0 times. The ratings could be downgraded if MasTec experiences end- market weakness or pursues a debt-financed acquisition that leads to a debt to EBITDA above 4.0 times and/or EBITA coverage of interest expense falls below 2.0 times. The SGL-2 speculative grade liquidity rating reflects Moody's expectation that MasTec will maintain a good liquidity profile near-term given its meaningful cash balance, expectations for positive free cash flow, available capacity under its revolving credit facility, and good flexibility under financial covenants. The principal methodology used in rating MasTec was the Global Construction Industry Methodology, published November 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. MasTec, Inc., headquartered in Coral Gables, Florida, is a leading national infrastructure company operating in the United States. The company reported revenues of approximately $2.3 billion for the fiscal-year ended Dec. 31, 2010. MEREULO MADDUX: Files Fourth Amended Joint Chapter 11 Plan ---------------------------------------------------------- BankruptcyData.com reports that Meruelo Maddux Properties filed a Fourth Amended Joint Chapter 11 Plan of Reorganization with the U.S. Bankruptcy Court. A related Disclosure Statement was not filed as a result of the previous Court order approving the Disclosure Statement. According to BData, the Plan states, "This is a joint Plan and not a consolidated Plan. The Debtors are not seeking substantive consolidation in this Plan. As a result, the Claims and Interests in each of the Debtors have been classified on a Debtor-by-Debtor basis." About Meruelo Maddux Meruelo Maddux and its affiliates filed for Chapter 11 protection (Bankr. C.D. Calif. Lead Case No. 09-13356) on March 26, 2009. Aaron De Leest, Esq., John J. Bingham, Jr., Esq., and John N. Tedford, Esq., at Danning Gill Diamond & Kollitz, represent the Debtors in their restructuring effort. The Debtors' financial condition as of Dec. 31, 2008, showed $681,769,000 in assets and $342,022,000 of debts. FTI Consulting, Inc., serves as the Debtors' financial advisors, Ernst & Young as independent auditors and tax advisors, DLA Piper LLP (US) as special securities and litigation counsel, and Waldron & Associates, Inc. as real estate appraiser. The U.S. Trustee has appointed an official committee of unsecured creditors and a separate official shareholders' committee in the case. SulmeyerKupetz, APC, serves as the Creditors Committee's counsel and Kibel Green, Inc., as its financial advisor. The equity committee has sought to retain Ron Orr & Professionals, Inc., Rodiger Law Office, and Jenner & Block as counsel, and Kibel Green, Inc. as its financial advisor. The Debtors; Legendary Investors Group No. 1, LLC, and East West Bank; and Charlestown Capital Advisors, LLC and Hartland Asset Management Corporation have proposed rival reorganization plans in the case. In mid-January 2011, the Debtors struck a deal with the Legendary Group to drop the group's competing plan. The Debtors have hired Kurtzman Carson Consultants as solicitation and balloting agent. Legendary Investors Group No. 1, LLC, is represented in the case by Jeremy V. Richards, Esq., and Jeffrey W. Dulberg, Esq., at Pachulski Stang Ziehl & Jones LLP; and Surjit P. Soni, Esq., at The Soni Law Firm. East West Bank is represented by Curtis C. Jung, Esq., and Monica H. Lin, Esq., at Jung & Yuen, LLP, and Elmer Dean Martin III, Esq. Charlestown Capital Advisors, LLC and Hartland Asset Management Corporation are represented in the case by Christopher E. Prince, Esq., Matthew A. Lesnick, Esq., and Andrew R. Cahill, Esq., at Lesnick Prince LLP. METALDYNE LLC: Moody's Affirms 'B1' CFR on Plan to Upsize Loan -------------------------------------------------------------- Moody's Investors Service affirmed the B1 Corporate Family and Probability of Default Ratings of Metaldyne, LLC following the company's announcement of its intention to increase its senior secured term loan facility to $355 million from $249 million. In a related action, a B1 rating was assigned to the resized term loan. Metaldyne's management has indicated that the net proceeds from the increase in the term loan will be used to fund an additional distribution to the company's shareholders (including the company's lead sponsors, The Carlyle Group and Solus Alternative Asset Management LP), or acquisitions. The details or timing of a potential acquisition have not been announced. The rating outlook is stable. This rating was assigned: -- B1 (LGD3, 46%), for the $355 million senior secured term loan These ratings were affirmed: -- Corporate Family Rating, B1; -- Probability of Default, B1; -- B1 (LGD3, 44%), for the $250 million senior secured term loan -- this rating will be withdrawn upon repayment of the facility RATINGS RATIONALE The affirmation of Metaldyne's B1 Corporate Family Rating incorporates the company's continued leveraged profile following the proposed increase in the secured term loan and improving industry conditions in the automotive industry. The increase in size of the term loan of about $100 million is expected to increase pro forma leverage as of Dec. 31, 2010 by about one turn of EBITDA to about 4x from about 3.1x. However, due to an anticipated reduction in interest rates under the new term loan, the company's interest expense should not increase materially. Moody's views the incremental leverage as a reduction in the financial flexibility, which may limit the ability for the company to use its balance sheet for additional acquisitions over the near-term. The CFR also continues to reflect Metaldyne's competitive position within the automotive parts supplier industry, balanced by industry risks. The company's EBIT margin (as adjusted by Moody's) improved to about 9% in 2010 reflecting restructuring actions taken in 2009 and recovering industry conditions. With 51% of Metaldyne's revenues from North America, the company should continue to participate in improving regional volumes. Yet, customer concentrations remain high with the top 4 customers representing about 47% of revenues. The ratings also incorporate the potential headwinds from temporary OEM production disruptions resulting from supply constraints out of Japan, and increasing raw material cost pressures. The stable rating outlook anticipates that Metaldyne's operating performance and adequate liquidity profile will continue to support the assigned rating over the intermediate term. Metaldyne is anticipated to continue to maintain an adequate liquidity profile over the near-term following the proposed transaction, supported by cash balances and free cash flow generation. The company is expected to have about $116 million of cash on hand following the close of the transaction, assuming the net proceeds are used for a shareholder distribution. Moody's continues to expect that the free cash flow generation over the near-term will be positive after working capital and capital expenditure needs. With the increase in the term loan, amortization requirements will modestly increase. Metaldyne's use of accounts receivable factoring programs continues to pose a potential risk that these programs might not be renewed on a timely basis. Metaldyne's $40 million asset based revolving credit is modest in size and is expected to remain largely unused over the near-term while supporting a modest amounts of letters of credit. The asset based revolving credit facility has a springing fixed charge coverage covenant of 1x, based on an availability trigger under the facility. Covenants under the secured term loan includesa maximum net leverage test. Alternate sources of raising liquidity are limited as essentially all the company's domestic assets will secure the ABL and term loan facilities. Improvement in Metaldyne's rating and/or outlook is limited over the near-term given the company's aggressive posture toward shareholder distributions. Positive ratings momentum could result from continued improvement in revenues, and operating performance resulting in debt/EBITDA reducing to 2.5x on sustained basis and EBIT/interest coverage approaching 4.0x. Further customer and industry diversification could also be viewed as positive events. The outlook or rating could be lowered if North American automotive production levels do not recover as anticipated, resulting in substantially weaker profitability, a deterioration in liquidity, or acquisitions or other shareholder distributions involving additional leverage. If operations were to weaken such that debt/EBITDA were to approach 4.5 times or free cash flow generation was not realized, the company's rating and/or outlook could be lowered. The principal methodology used in rating Metaldyne was the Global Automotive Supplier Industry Methodology, published January 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Metaldyne, LLC is a leading global manufacturer of highly engineered metal-based components for light vehicle engine, transmission and driveline applications for the global automotive light vehicle market. The company is wholly-owned subsidiary of MD Investors Corporation which itself is owned by a coalition of investors led by The Carlyle Group and Solus Alternative Asset Management LP. METALDYNE LLC: S&P Rates 'B+' $355MM Term Loan, Affirms 'B+' CCR ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' issue-level rating to Plymouth, Mich.-based automotive supplier Metaldyne LLC's proposed $355 million senior secured term loan due 2017. The company intends to use the proceeds of the debt issue to help fund dividends or acquisitions and to refinance certain existing debt. "At the same time, we affirmed our 'B+' corporate credit rating. The outlook is stable," S&P said. "The ratings reflect what we consider Metaldyne's weak business risk profile and aggressive financial risk profile," said Standard & Poor's credit analyst Robert Schulz. "Our business risk assessment incorporates the multiple industry risks facing automotive suppliers, including volatile demand, high fixed costs, intense competition, and severe pricing pressures. These risks more than offset the favorable fact that Metaldyne's products are used mostly in vehicle powertrains and therefore have longer lives, are less commodity-like than many other automotive parts, and support the company's double-digit EBITDA margins. The financial risk assessment reflects our view that low free operating cash flow (FOCF) and, in the long term, possible future additional distributions to shareholders will limit significant debt reduction." The company is a private-equity-owned automotive supplier created from certain assets during the bankruptcy restructuring of Metaldyne Corp. "The stable outlook reflects our belief that Metaldyne can achieve low, but still positive, FOCF in the 12 months ahead and adjusted EBITDA of around $100 million, (higher than our previous expectation of $80 million) given the relatively favorable trend for vehicle production in North America, though somewhat offset by weaker markets in Europe. "We consider Ford's ability to maintain its market share a key factor in Metaldyne's performance," S&P said. "We could lower the rating if FOCF generation turns negative for consecutive quarters or if we believe that debt to EBITDA, including our adjustments, would exceed 5x," Mr. Schulz continued. "We estimate that debt to EBITDA could reach this threshold if, for example, Metaldyne's gross margins, excluding depreciation and amortization, fall by about 250 basis points and there is limited revenue growth over the next year. We consider an upgrade unlikely during the next year, based on our current assessment of the company's business and financial risks and Metaldyne's concentrated ownership by financial sponsors, which we believe indicates that financial policies will remain very aggressive." MICHAEL DAVIS: Appeal Over Seizure of Exempt Assets to Continue --------------------------------------------------------------- In a May 2, 2011 Order, District Judge Susan C. Bucklew denied a request by Brian Dowling to dismiss an appeal by Michael Davis over a bankruptcy court ruling that Mr. Dowling was not liable for his seizure of the Debtor's exempt retirement assets. Mr. Dowling urged the District Court to dismiss Mr. Davis' appeal on the basis that Mr. Davis' notices of appeal were untimely because Mr. Davis' motions for reconsideration or rehearing did not toll his deadline to file a notice of appeal. In a May 2, 2011 Order, Judge Bucklew held that Mr. Davis' notices of appeal, filed 12 days after the bankruptcy court entered orders awarding interest to Mr. Davis and denying Mr. Davis' motions for reconsideration or rehearing as moot, were timely. In 2002, Mr. Dowling obtained judgments against Mr. Davis in Illinois state court. In an attempt to satisfy the judgments, Mr. Dowling sought in Illinois state court and obtained turnover of the funds held in Mr. Davis' IRA and 401(k) accounts. Mr. Davis appealed the turnover orders regarding his retirement assets to an Illinois appellate court, arguing that his retirement assets were exempt from creditors. In March 2006, the Illinois appellate court remanded the case, directing the trial court to conduct an evidentiary hearing on whether the retirement assets were exempt. On remand, the trial court determined that the retirement assets were exempt under Illinois law and ordered Mr. Dowling to remit the principal amount collected to Mr. Davis. Mr. Dowling posted a bond and appealed the trial court's order on remand. The trial court's order was affirmed by an Illinois appellate court on Sept. 8, 2008. Also in 2008, bankruptcy proceedings were initiated against Mr. Davis in the Middle District of Florida. The bankruptcy proceedings consisted of two different cases: (1) an involuntary petition under Chapter 11 with Mr. Dowling as one of the petitioning creditors and (2) an adversary proceeding initiated by Mr. Dowling to determine the proper recipient of the retirement assets. Mr. Davis filed a counterclaim against Mr. Dowling in the Adversary Proceeding seeking damages for seizing an exempt asset in violation of Illinois law, common law wrongful garnishment, and common law conversion. Mr. Davis also filed an objection to Mr. Dowling's claim in the Bankruptcy Case. In April 2009, the bankruptcy court entered an order finding that Mr. Davis' retirement assets were exempt from creditors. In May 2009, the Order Confirming Plan was entered in the Bankruptcy Case but the bankruptcy court reserved jurisdiction to consider Mr. Davis' counterclaim for damages in the Adversary Proceeding, which was consolidated with Mr. Davis' objection in the Bankruptcy Case. The bankruptcy court held a trial on Mr. Davis' counterclaim in 2010. At issue was whether to impose liability against Mr. Dowling for his seizure of Mr. Davis' exempt retirement assets. At the conclusion of the trial, the bankruptcy court found in favor of Mr. Dowling. Mr. Davis sought reconsideration or rehearing as to the Judgment. Mr. Davis' motions for reconsideration or rehearing were substantively identical and were filed "in an abundance of caution" due to the parties' perceived disagreement over whether Mr. Davis was entitled to damages or compensation in the form of interest at 9% for the entire time that he was deprived of his exempt retirement assets. In October 2010, the bankruptcy court decided the interest issue in favor of Mr. Davis, awarding him post-judgment interest in the amount of 9% on the retirement asset funds that were held by Mr. Dowling during a specified time period. The bankruptcy court then denied Mr. Davis' motions for reconsideration or rehearing as moot. Mr. Davis appealed, saying the bankruptcy court erred in failing to impose liability against Mr. Dowling for his seizure of Mr. Davis' exempt retirement assets. The District Court case is Michael Davis, Appellant, v. Brian Dowling, Appellee, Case Nos. 8:11-cv-89-T-24, 8:11-cv-90-T-24 (M.D. Fla.). A copy of the District Court's ruling is available at http://is.gd/sJdOY7from Leagle.com. An involuntary Chapter 11 bankruptcy petition was filed against St. Petersburg, Florida-based Michael Davis (Bankr. M.D. Fla. Case No. 08-04348) on March 31, 2008, Judge Michael G. Williamson presiding. The petitioning creditors are Brain Dowling, North Shore Community Bank, MaryAnne Davis, and David P. Pasulka. They are represented by Asher Rabinowitz, Esq. -- azr@andersonbadgley.com -- at Anderson & Badgley, P.L. MILAGRO OIL: Moody's Rates Notes 'Caa2'; Outlook Negative --------------------------------------------------------- Moody's Investor's Service assigned a Caa2 rating to Milagro Oil and Gas, Inc.'s senior secured second lien notes due 2016, and assigned a Corporate Family Rating of Caa1. The rating outlook is negative. This is the first time that Moody's has rated Milagro. Net proceeds from the notes will be used to repay the existing second lien term loan and to reduce the amount currently outstanding under the revolving credit facility. Concurrent with the transaction the credit facility will be amended and restated, extending the maturity date to 2014. RATINGS RATIONALE "The Caa1 CFR reflects Milagro's very high leverage on production and reserves, small scale, and the potential for tight liquidity if leverage continues to increase," commented Jonathan Kalmanoff, Moody's Analyst. "The ratings are supported by a relatively high and increasing proportion of liquids production, shallow decline rates, good geological diversification, and supportive financial sponsors." The negative outlook considers the potential for increasing leverage on production and reserves as the company outspends cash flow, as well as the potential for decreasing covenant headroom, depending on the mix of debt versus equity financing and the levels of production and cash flow achieved. Moody's calculates Milagro's Dec. 31, 2010 pro forma leverage on average daily production at $50,796/boe/d. In calculating leverage, Moody's views the company's preferred stock as 50% debt. At Dec. 31, 2010 pro forma for the notes issuance Milagro had $18 million of cash and $70 million of availability under its new $300 million senior secured first lien credit facility. Availability under the revolver is restricted by its $170 million borrowing base. Covenants under the facility include a Debt / EBITDA limit of 4.5x (stepping down to 4.25x in 2012), a Senior Secured Debt / EBITDA limit of 2.0x, minimum EBITDA / Interest of 2.25x (stepping up to 2.5x in 2012), and a current ratio of 1.0x. At Dec. 31, 2010 pro forma, covenant calculations were Debt / EBITDA of 3.2x, EBITDA / Interest of 5.0x, and a current ratio of 1.3x. While there is currently adequate headroom under the covenants, if leverage rises over the next few quarters as Milagro outspends cash flow and funds part of the negative free cash flow with debt, covenants could become stressed. With the credit facility maturing in 2014 and the notes maturing in 2016 there are no near term debt maturities. Substantially all of Milagro's oil and gas reserves are pledged as collateral which limits the extent to which asset sales could provide a source of additional liquidity if needed. The Caa2 senior unsecured note rating reflects both the overall probability of default of Milagro, to which Moody's assigns a PDR of Caa1, and a loss given default of LGD5-70%. The size of the senior secured first lien revolver's potential priority claim relative to the senior secured second lien notes results in the notes being rated one notch beneath the Caa1 CFR under Moody's Loss Given Default Methodology. The outlook could be changed to stable if leverage on production and reserves does not continue to increase from current levels, covenant headroom does not deteriorate, and a positive production trend is established in response to increasing levels of capital spending. The rating could be lowered if liquidity or covenant headroom becomes stressed, leverage on average daily production appears likely to increase to $60,000/boe/d or higher, or Debt / Proven Developed Reserves appears likely to increase to $21.00/boe or higher. The principal methodology used in rating Milagro Mezz was the Independent Exploration and Production (E&P) Industry Methodology, published December 2008. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009 Milagro Oil and Gas, Inc. is an independent exploration and production company headquartered in Houston, Texas. MOLECULAR INSIGHT: Deregisters Unissued Shares Under Stock Plans ---------------------------------------------------------------- Molecular Insight Pharmaceuticals, Inc., filed on May 3, 2011, a Post-Effective Amendment No. 1 to its registration statement on Form S-8, Registration No. 333-145476, which was filed with the Securities and Exchange Commission on Aug. 15, 2007, to deregister, as of the effectiveness of this Post-Effective Amendment, all shares of the Common Stock that were registered under the Registration Statement and remain unissued under the Company's 1977 Stock Option Plan. The Form S-8 registered 1,882,701 shares of the Company's common stock, par value $0.01, for issuance under the 1997 Stock Option Plan. A complete text of the S-8 POS to the Aug. 15, 2007 registration statement is available for free at http://is.gd/SlZWCz The Company also filed Post-Effective Amendment No. 1 to its registration statement on Form S-8, Registration Statement No. 333-165852, which was filed with the SEC on April 1, 2010, to deregister, as of this Post-Effective Amendment, all additional shares of Common Stock that were registered under the Registration Statement and remain unissued under the Company's Amended and Restated 2006 Equity Incentive Plan. The Form S-8 registered an additional 1,010,733 shares of the Company's common stock, par value $0.01, for issuance under the Amended and Restated 2006 Equity Incentive Plan. The Company no longer issues securities under the Plan. A complete text of the S-8 POS to the April 1, 2010 registration statement is available for free at http://is.gd/fVxxEG The Company also filed Post-Effective Amendment No. 1 to its registration statement on Form S-8, Registration Statement No. 333-157957, which was filed with the SEC on March 13, 2009, to deregister, as of this Post-Effective Amendment, all additional shares of Common Stock that were registered under the Registration Statement and remain unissued under the Company's Amended and Restated 2006 Equity Incentive Plan. The Form S-8 registered an additional 1,002,776 shares of the Company's common stock, par value $0.01, for issuance under the Amended and Restated 2006 Equity Incentive Plan. The Company no longer issues securities under the Plan. A complete text of the S-8 POS to the March 13, 2009 registration statement is available for free at http://is.gd/67fabs The Company also filed Post-Effective Amendment No. 1 to its registration statement on Form S-8, Registration Statement No. 333-152972, which was filed with the SEC on Aug. 12, 2008, to deregister, as of this Post-Effective Amendment, all additional shares of the the Common Stock that were registered under the Registration Statement and remain unissued under the Company's Amended and Restated 2006 Equity Incentive Plan. The Form S-8 registered an additional 998,126 shares of the Company's common stock, par value $0.01, for issuance under the Amended and Restated 2006 Equity Incentive Plan. The Company no longer issues securities under the Plan. A complete text of the S-8 POS to the Aug. 12, 2008 registration statement is available for free at http://is.gd/5HX408 The Company also filed Post-Effective Amendment No. 1 to its registration statement on Form S-8, Registration Statement No. 333-143065, which was filed with the SEC on May 17, 2007, to deregister, as of this Post-Effective Amendment, all shares of the the Common Stock that were registered under the Registration Statement and remain unissued under the Company's Amended and Restated 2006 Equity Incentive Plan. The Form S-8 registered 2,300,000 shares of the Company's common stock, par value $0.01, for issuance under the Amended and Restated 2006 Equity Incentive Plan. The Company no longer issues securities under the Plan. A complete text of the S-8 POS to the May 17, 2007 registration statement is available for free at http://is.gd/o0Tny5 About Molecular Insight Cambridge, Massachusetts-based Molecular Insight Pharmaceuticals, Inc., is a clinical-stage biopharmaceutical company that provides services on the detection and treatment of various forms of cancer and other life-threatening diseases. The Debtor disclosed $36,453,000 in total assets and $198,829,000 in total debts as of Sept. 30, 2010. Molecular Insight filed for Chapter 11 bankruptcy protection (Bankr. D. Mass. Case No. 10-23355) on Dec. 9, 2010. Kenneth H. Eckstein, Esq., and P. Bradley O'Neill, Esq., at Kramer Levin Naftalis & Franklin LLP, in New York, serve as the Debtor's lead bankruptcy counsel. Alan L. Braunstein, Esq., Guy B. Moss, Esq., Christopher M. Candon at Riemer & Braunstein, LLP, in Boston, serve as the Debtor's local counsel. Foley & Lardner LLP is the Debtor's special counsel. Tatum LLC, a division of SFN Professional Services LLC, is the Debtor's financial consultant. Omni Management Group, LLC, is the claims, and balloting agent. On March 23, 2011, the Bankruptcy Court entered its order approving the disclosure statement explaining the Debtor's First Amended Chapter 11 Plan of Reorganization. The Amended Plan provides for, among other things: (i) $40,000,000 of new capital, to be raised through an exit facility that will be funded by certain of the Consenting Bondholders and affiliate entities of certain of the Consenting Bondholders; (ii) the conversion of the Bonds into 100% of the new equity in the post-Effective Date reorganized Debtor; (iii) the payment of a pro rata share of $500,000 in cash to holders of allowed general unsecured claims; and (iv) the cancellation of existing equity interests. MOLECULAR INSIGHT: Withdraws COM Purchase Rights from Nasdaq ------------------------------------------------------------ Molecular Insight Pharmaceuticals, Inc., filed on May 3, 2011, with the SEC a Form 25 notification voluntarily withdrawing its Common Stock Purchase Rights from listing and registration on The Nasdaq Stock Market LLC. Pursuant to the requirements of the Securities Exchange Act of 1934, Molecular Insight Pharmaceuticals, Inc., certifies that it has reasonable grounds to believe that it meets all of the requirements for filing the Form 25. SEC Form 25 is required by Rule 12d2-2 of the Securities Exchange Act of 1934. A security is considered to be delisted 10 days after the filing of Form 25 with the SEC. As reported in the TCR on Jan. 25, 2011,, The Nasdaq Stock Market LLC filed Form 25-NSE with the SEC to delist Molecular Insight's common stock from the Nasdaq Global Market, which delisting took effect on Jan. 31, 2011. A complete text of the Form 25 is available for free at: http://is.gd/A5I0LK About Molecular Insight Cambridge, Massachusetts-based Molecular Insight Pharmaceuticals, Inc., is a clinical-stage biopharmaceutical company that provides services on the detection and treatment of various forms of cancer and other life-threatening diseases. The Debtor disclosed $36,453,000 in total assets and $198,829,000 in total debts as of Sept. 30, 2010. Molecular Insight filed for Chapter 11 bankruptcy protection (Bankr. D. Mass. Case No. 10-23355) on Dec. 9, 2010. Kenneth H. Eckstein, Esq., and P. Bradley O'Neill, Esq., at Kramer Levin Naftalis & Franklin LLP, in New York, serve as the Debtor's lead bankruptcy counsel. Alan L. Braunstein, Esq., Guy B. Moss, Esq., Christopher M. Candon at Riemer & Braunstein, LLP, in Boston, serve as the Debtor's local counsel. Foley & Lardner LLP is the Debtor's special counsel. Tatum LLC, a division of SFN Professional Services LLC, is the Debtor's financial consultant. Omni Management Group, LLC, is the claims, and balloting agent. On March 23, 2011, the Bankruptcy Court entered its order approving the disclosure statement explaining the Debtor's First Amended Chapter 11 Plan of Reorganization. The Amended Plan provides for, among other things: (i) $40,000,000 of new capital, to be raised through an exit facility that will be funded by certain of the Consenting Bondholders and affiliate entities of certain of the Consenting Bondholders; (ii) the conversion of the Bonds into 100% of the new equity in the post-Effective Date reorganized Debtor; (iii) the payment of a pro rata share of $500,000 in cash to holders of allowed general unsecured claims; and (iv) the cancellation of existing equity interests. MOLECULAR INSIGHT: Court Confirms Reorganization Plan ----------------------------------------------------- Molecular Insight Pharmaceuticals, Inc. disclosed that at a hearing held on May 5, 2011, the U.S. Bankruptcy Court for the District of Massachusetts confirmed the Company's Amended Plan of Reorganization (the "Plan"). Molecular Insight is scheduled to emerge from Chapter 11 as a fully restructured company by late May 2011. As confirmed, the Plan restructures the Company's consolidated balance sheet by reducing outstanding debt by approximately $162 million and facilitating a new capital infusion of approximately $40 million. Under the Plan, all outstanding shares of the Company's common stock will be extinguished on the Plan's effective date. In addition, the Bankruptcy Court approved an order that would restrict, under certain circumstances, the trading of the Company's common stock by entities that hold more than 4.5% of the Company's common stock in order to preserve the full amount of the Company's net operating losses. Molecular Insight expects its Plan to become effective on or about May 20, 2011, once all closing conditions have been met. "The reorganization plan and new capital structure will allow Molecular Insight to emerge from Chapter 11 with the financial flexibility necessary to maximize our growth potential in the molecular medicine field," said Harry Stylli, President and Chief Restructuring Officer of Molecular Insight. On December 9, 2010, Molecular Insight filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the District of Massachusetts. Molecular Insight filed for Chapter 11 bankruptcy protection (Bankr. D. Mass. Case No. 10-23355) on Dec. 9, 2010. Kramer Levin Naftalis & Franklin LLP serves as the Debtor's lead bankruptcy counsel. Alan L. Braunstein, Esq., at Riemer & Braunstein, LLP, serves as the Debtor's local Massachusetts counsel. Foley & Lardner LLP is the Debtor's special counsel. Tatum LLC, a division of SFN Professional Services LLC, is the Debtor's financial consultant. Omni Management Group, LLC, is the claims, and balloting agent. MONTPELIER RE: S&P Gives 'BB+' Rating on $150MM Preferred Stock --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' preferred stock rating to Montpelier Re Holdings Ltd.'s (NYSE:MRH; BBB/Stable/--) $150 million, 8.875% perpetual noncumulative preferred stock issue. The proceeds from the preferred stock will increase the company's financial flexibility. After issuing the $150 million of preferred stock, Montpelier's March 31, 2011, pro forma debt-plus-hybrid to capital ratio will be 25.6%. Assuming that the preferred stock was in place throughout 2010, pro forma fixed-charge coverage for the year would have been 5.1x, which is appropriate for the rating. Montpelier's gross premiums written increased about 13% to $720 million in 2010, with growth stemming from the MUSIC and Montpelier Syndicate 5151 segments. In 2010, Montpelier's operating performance deteriorated somewhat because of higher catastrophe losses endemic to the industry. Montpelier's catastrophe losses from the New Zealand and Chilean earthquakes and the Deepwater Horizon disaster were $155.9 million. Partially offsetting these losses was $109.3 million of favorable loss reserve development. Montpelier's EBITDA was $206 million, and its combined ratio was 82.0%, compared with $309 million and 62.2%, respectively, in 2009. In 2010, Montpelier repurchased $294 million of its common stock and paid $26.2 million of dividends, contributing to a 5.8% reduction in shareholders' equity and a small increase in the debt-plus-hybrid to capital ratio to 16.7% from 16.0%. Lower earnings decreased the interest coverage ratio to 8.4x from 11.7x. The leverage and coverage metrics were strong and remained consistent with the rating. In the first quarter, Montpelier's results were affected by losses from the Australian Cyclone Yasi, the New Zealand earthquake, and -- most notably -- the Tohoku earthquake causing $5 million, $65 million, and $130 million in losses, respectively. The combined ratio was 178.8% (199% excluding prior-year development). "We believe that capital remains strong after these catastrophic losses and expect that Montpelier will generate about a 110% combined ratio for full-year 2011, assuming normal catastrophe activity for the balance of the year. Also assuming normal catastrophe activity for the remainder of 2011, we expect that Montpelier will return to a debt-plus-hybrid to capital ratio below 25% by the end of 2011 and that fixed-charge coverage will remain above 3x for the balance of the year," S&P stated. Ratings List Montpelier Re Holdings Ltd. Counterparty Credit Rating BBB/Stable/-- New Rating Montpelier Re Holdings Ltd. $150M Preferred Stock Issue BB+ MOOD MEDIA: Moody's Upgrades First Lien Loan to 'Ba3' From 'Ba1' ---------------------------------------------------------------- Moody's Investors Service upgraded Mood Media Corporation's first lien credit facilities to Ba3 from B1 as the improvement in recovery prospects resulting from the first lien facilities being downsized (to $375 million [comprised of a $20 million RTL and a $355 TL] from $415 [comprised of a $25 million RTL and a $390 TL]) while the second lien term loan was up-sized (to $100 million from $65 million), was sufficient to warrant an upgrade. Since the amendment adjusts only the relative proportions of first and second lien claims but does not affect total debt, the corporate family and probability of default ratings (CFR and PDR respectively) remain unchanged at B2/B3 and the rating outlook remains stable. As well, recovery prospects of the second lien facilities are not altered sufficiently to warrant ratings action; their rating remains unchanged at Caa1. Lastly, while Mood Media's revolving credit facility has been downsized to $20 million from $25 million, the impact on over-all liquidity is minimal and the company's SGL-3 speculative grade liquidity rating (indicating adequate liquidity) remains unchanged. Assignments: Issuer: Mood Media Corporation -- Senior Secured Credit Facility: Upgraded to Ba3 (LGD2, 19%) from B1 (LGD2, 23%) -- Corporate Family Rating: Unchanged at B2 -- Probability of Default Rating: Unchanged at B3 -- Second Lien Credit Facility: Unchanged at Caa1 with the LGD assessment revised to LGD4, 64% from LGD4, 68% -- Speculative Grade Liquidity Rating: Unchanged at SGL-3 Outlook: Unchanged at Stable RATINGS RATIONALE Mood Media's B2 CFR rating is influenced primarily by the leverage and coverage measures that result from the company's pending acquisition of Muzak, a provider of music to retail/commercial customers in the U.S. As well, the company has an entrepreneurial management team, has a relatively limited operating history which has featured a series of recent acquisitions and business combinations, and continues to be in a growth phase that may result in additional acquisition or business combination activity. Consequently, while estimated pro forma leverage and coverage are only modestly aggressive and a combination of product line expansion and increased market penetration may facilitate significant organic growth, until there is a track record of both debt repayment and a stable business platform, Moody's anticipates that EBITDA expansion will be approximately equal with that of the general economy. Moody's also expects that should management achieve higher growth, that excess cash flow may be channeled towards business expansion rather than debt repayment and de- leveraging. At the same time, Moody's expects that there should not be much downside to achieving modest positive free cash flow given established customer relationships and the stable nature of repetitive subscriptions. Moody's also recognizes Mood's strong market share in retail/commercial music in both Europe and now the U.S. Rating Outlook The ratings outlook is stable. Pending debt repayment and the business model stabilizing, it is presumed that leverage and coverage measures will remain in a range which, for a small media services company, are indicative of a B2 CFR. What Could Change the Rating - Up Given the company's very limited operating history and the volatility in its business model , a near term ratings upgrade is not expected. However, should the business model stabilize and should free cash flow be used to repay debt, positive outlook and ratings actions would be considered if we expected the Debt/EBITDA to be sustained below 3.5x with FCF/Debt of no worse than 7.5%. What Could Change the Rating -- Down Should the company encounter setbacks integrating Muzak, or should liquidity deteriorate materially, or should a debt-financed acquisition transpire, downwards rating pressure would result. As well, were Debt/EBITDA to increase beyond 5.0x, adverse outlook and ratings pressure would result. In addition, should the ratio of first lien to second lien debt increase, there is the potential of the first lien's instrument rating being downgraded as junior- ranking loss absorption capacity decreases. The principal methodologies used in rating Mood Media were Probability of Default Ratings and Loss Given Default Assessments published in June 2009, Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009 and Speculative Grade Liquidity Ratings Published in September 2002. MORGANS HOTEL: Incurs $32.86 Million Net Loss in March 31 Quarter ----------------------------------------------------------------- Morgans Hotel Group Co. reported a net loss of $32.86 million on $54.40 million of total revenues for the three months ended March 31, 2011, compared with a net loss of $16.10 million on $53.38 million of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $692.76 million in total assets, $721.93 million in total liabilities and a $29.17 million in total stockholders' deficit. Michael Gross, CEO of the Company, said: "The underlying trends in our markets continue to improve and we see many opportunities to grow our business. With a new management team in place, we are focused on reinforcing our position as the global leader in lifestyle hospitality management by expanding our brands and winning higher margin management contracts domestically and internationally. We plan to strengthen our core competencies and enhance the unique DNA on which Morgans was founded. We will also continue to pursue an asset-light model, reducing our asset base and improving our capital structure to give us the flexibility and resources to pursue our growth initiatives. We are confident that we are well positioned to capitalize on the opportunities ahead and increase shareholder value over the long-term." A full-text copy of the press release announcing the financial results is available for free at http://is.gd/wSW54K 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 reported a net loss of $83.64 million on $236.37 million of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $101.60 million on $225.05 million of total revenues during the prior year. MOVIE GALLERY: Settles Debt Collection Suit With 50 States ---------------------------------------------------------- Samuel Howard at Bankruptcy Law360 reports that the liquidating trustee of Movie Gallery Inc. on Thursday reached a settlement in Virginia with all 50 states over Company's hardnosed collection efforts and credit reporting campaign. Law360 relates that Montana Attorney General Steve Bullock announced that his office finalized an agreement with Movie Gallery and its bankrupt subsidiary Hollywood Video that prevents the companies from continuing their allegedly abusive efforts to collect hundreds of millions of dollars in late fees from former customers. About Movie Gallery Based in Wilsonville, Oregon, Movie Gallery, Inc., was the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 bankruptcy protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private- investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 bankruptcy (Bankr. E.D. Va. Case No. 10-30696) on Feb. 3, 2009. Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants served as claims and notice agent. MUMTAZ HANNA GEORGE: Court Wants Plan Documents Amended ------------------------------------------------------- Bankruptcy Judge Thomas J. Tucker directed Mumtaz Hanna George to file an amended combined plan and disclosure statement to correct various flaws identified by the Court. The amended plan documents were due no later than May 3, 2011. The Debtor filed a Combined Plan and Disclosure Statement on April 22, 2011. A copy of the Court's April 27, 2011 Order is available at http://is.gd/hkTBCl from Leagle.com. Mumtaz Hanna George in Farmington Hills, Michigan, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 10-72383) on Oct. 22, 2010, represented by Ethan D. Dunn, Esq. -- bankruptcy@maxwelldunnlaw.com -- at Maxwell Dunn, PLC. In the petition, the Debtor estimated $1 million to $10 million in assets and debts. NALCO COMPANY: Fitch Affirms Issuer Default Rating at 'B+' ---------------------------------------------------------- Fitch Ratings affirms Nalco Company's ratings including its 'B+' Issuer Default Rating. The Rating Outlook is Stable. The ratings reflect resilient margins, solid liquidity, stable free cash flow generation and expectation for modest growth and debt repayment over the next 12-18 months. Nalco's operations benefit from its dominant market share, broad product offerings, geographic reach, and strong customer retention. Diversification across products, geography and customers and low capital spending requirements have resulted in stable free cash flow generation. Liquidity at March 31, 2011 was solid with $118.7 million of cash on hand and $228.9 million available under the $250 million revolver maturing May 2014, after utilization of $21.1 million for letters of credit, and availability under the $150 million accounts receivable facility maturing June 2013 of $25 million after borrowings of $125 million. Latest 12 month March 31, 2011 (LTM) operating EBITDA was $739.9 million, total debt to LTM operating EBITDA was 3.7 times (x), and LTM free cash flow was $138.3 million. Fitch believes management will achieve its guidance of $735 million in Adjusted EBITDA given sufficient visibility into costs and revenues. Nalco guides to $175 million in free cash flow, excluding the impact from divestitures and the $35 million of atypically high rent and profit sharing payments but after capital expenditures of $200 million in 2011. Fitch expects total debt/operating EBITDA to remain below 4.0x and average about 3.5x over the next 18-24 months. Estimated debt maturities over the next five years are $93.3 million due in 2011 including short-term debt, $10.5 million in 2012, $135.5 million in 2013 inclusive of drawings under the accounts receivable facility, $10.5 million in 2014 and $10.5 million in 2015. The bank facilities have a maximum consolidated net debt to EBITDA ratio that is currently 4.75x but steps down to 4.25x under the existing agreement beginning Oct. 1, 2011. The secured leverage ratio must be less than or equal to 2.3x. Fitch expects that the company will remain well within compliance with its covenants. The Stable Outlook reflects the company's stable business model and the ability to repay debt through free cash generation. Meaningful debt repayment could result in a positive rating action for the IDR. Significant additional financial leverage associated with a sizable acquisition or a recapitalization would result in a review with negative rating implications. Fitch has affirmed these ratings: Nalco Company -- IDR at 'B+'; -- Senior secured revolving credit facility at 'BB+/RR1'; -- Senior secured term loans at 'BB+/RR1'; -- Senior unsecured notes at 'BB/RR2'. NELSON INC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Nelson, Inc. 3360 Fontaine Memphis, TN 38116 Bankruptcy Case No.: 11-24542 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court Western District of Tennessee (Memphis) Judge: Jennie D. Latta Debtor's Counsel: Paul A. Robinson, Jr., Esq. LAW OFFICE OF PAUL A. ROBINSON 5 North Third, Suite 2000 Memphis, TN 38103 Tel: (901) 649-4053 Fax: (901) 328-1803 E-mail: problaw9@yahoo.com Scheduled Assets: $5,652,097 Scheduled Debts: $5,715,929 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/tnwb11-24542.pdf The petition was signed by Willie Nelson, stockholder. NEUROLOGIX INC: Enters Into Letter Agreement with M. Kaplitt ------------------------------------------------------------ Neurologix, Inc., entered into a letter agreement dated April 29, 2011 with Dr. Michael G. Kaplitt. The Letter Agreement amends, effective as of April 30, 2011, that certain Amended and Restated Consulting Agreement, dated as of April 25, 2005, by and between Dr. Michael G. Kaplitt and Neurologix Research, Inc., the predecessor by merger to the Company. The Letter Agreement extends, effective as of April 30, 2011, the term of the Consulting Agreement from April 30, 2011 to April 30, 2012. Dr. Kaplitt is one of the Company's scientific co-founders and a member of its Scientific Advisory Board. A full-text copy of the Letter Agreement is available for free at: http://is.gd/QCIQBd About Neurologix, Inc. Fort Lee, N.J.-based Neurologix, Inc. (OTC Bulletin Board: NRGX) -- http://www.neurologix.net/-- is a clinical-stage biotechnology company dedicated to the discovery, development, and commercialization of gene transfer therapies for serious disorders of the brain and the central nervous system. The Company's current programs address such conditions as Parkinson's disease, epilepsy, depression and Huntington's disease, all of which are large markets not adequately served by current therapeutic options. The Company reported a net loss of $10.16 million on $0 of revenue for the year ended Dec. 31, 2010, compared with a net loss of $13.46 million on $0 of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $9.68 million in total assets, $13.84 million in total liabilities and $4.16 million in total stockholders' deficit. BDO USA, LLP, in New York, raised substantial doubt about the Company's ability to continue as a going concern. BDO noted that the Company has suffered recurring losses from operations, expects to incur future losses for the foreseeable future and has deficiencies in working capital and capital. NEW YORK SPOT: Case Summary & 3 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: New York Spot Inc. 3317 Avenue N Brooklyn, NY 11234 Bankruptcy Case No.: 11-43785 Chapter 11 Petition Date: May 4, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Jerome Feller Debtor's Counsel: Kevin J. Nash, Esq. GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP 1501 Broadway, 22nd Floor New York, NY 10036 Tel: (212) 301-6944 Fax: (212) 422-6836 E-mail: KNash@gwfglaw.com Scheduled Assets: $3,000,000 Scheduled Debts: $2,590,500 A list of the Company's three largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nyeb11-43785.pdf The petition was signed by Yehuda Nelkenbaum, president. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Martense New York Inc. 09-48910 10/09/09 NPS PHARMACEUTICALS: Incurs $9.15-Mil. Net Loss in March 31 Qtr. ---------------------------------------------------------------- NPS Pharmaceuticals, Inc., filed with the U.S. Securities and Exchange Commission a Form 10-Q reporting a net loss of $9.15 million on $23.57 million of total revenues for the three months ended March 31, 2011, compared with a net loss of $3.05 million on $20.29 million of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $158.27 million in total assets, $317.94 million in total liabilities and a $159.67 million total stockholders' deficit. "The success of our recent equity offering, which raised $107 million, gives us the financial flexibility to deliver a number of key milestones, including the approval of our first product in 2012," said Francois Nader, M.D., president and chief executive officer of NPS Pharmaceuticals. "We look forward to reporting additional data from the GATTEX Phase 3 clinical program at the upcoming Digestive Disease Week conference in Chicago and submitting the drug for U.S. approval later this year. We also remain on track to report top-line results from the Phase 3 REPLACE study of NPSP558 before year-end." A full-text copy of the Form 10-Q is available for free at: http://is.gd/V7Mkr1 About NPS Pharmaceuticals Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq: NPSP) -- http://www.npsp.com/-- is developing new treatment options for patients with rare gastrointestinal and endocrine disorders. The Company reported a consolidated net loss of $31.44 million on $89.41 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $17.86 million on $84.15 million of total revenue during the prior year. NPS noted in its Form 10-K for the year ended Dec. 31, 2009, it has not been profitable since its inception in 1986. As of Dec. 31, 2009, it had an accumulated deficit of $922.7 million. "Currently, we are not a self-sustaining business and certain economic, operational and strategic factors may require us to secure additional funds." The Company though believes its existing capital resources at Dec. 31, 2009, along with the receipt of $38.4 million from the sale of its REGPARA royalty stream, should be sufficient to fund its current and planned operations through at least Jan. 1, 2011. OLDE PRAIRIE: Can Borrow Funds to Pay Portion of JMB Expenses ------------------------------------------------------------- Bankruptcy Judge Jack B. Schmetterer granted Olde Prairie Block Owner, LLC's request to borrow additional funds from JMB Capital Partners to pay JMB's attorney fees and expenses associated with JMB's prior loan. The Debtor was previously authorized under 11 U.S.C. Sec. 364(d) to borrow from JMB in exchange for a priming lien on its property, but only for expenses it demonstrated were reasonable and necessary. JMB agreed to loan up to $4 million, although only enough to net a total of $2,007,639 has thus far been approved. CenterPoint, the Debtor's current secured lender, objected to the Debtor's request to borrow additional funds, arguing that: -- multiple attorneys attended various hearings and depositions. Fees for nonparticipating counsel at hearings and depositions are not generally considered necessary and reasonable, so those expenses cannot prime CenterPoint's lien; -- senior attorneys billed at high rates for simple tasks, such as assembling a hearing binder and calendaring hearings; and -- many time entries are too vague and inadequate to justify a priming lien. Judge Schmetterer said JMB's Financing Expenses are entirely valid and enforceable as between Debtor and JMB. However, JMB will have Section 364 priming rights for all that is sought except $76,685 of the requested JMB Financing Expenses, thus allowing only $542,928 of those Expenses to prime CenterPoint Properties Trust's lien. A copy of Judge Schmetterer's May 3, 2011 Findings of Fact and Conclusions of Law is available at http://is.gd/BU4mwgfrom Leagle.com. About Olde Prairie Block Owner Olde Prairie Block Owner, LLC, owns two parcels of real estate: (a) a parcel known as the "Olde Prairie Property" located at 230 E. Cermak Road in Chicago, and (b) a parcel known as the "Lakeside Property" located across the street at 330 E. Cermak Road in Chicago. It also holds a long-term lease with the Metropolitan Pier and Exposition Authority that allows it rent-free use of 450 parking spaces at the McCormick Place parking garage until the year 2203. Olde Prairie Block Owner sought chapter 11 protection (Bankr. N.D. Ill. Case No. 10-22668) on May 18, 2010. The Debtor is represented by John E. Gierum, Esq., at Gierum & Mantas, and John Ruskusky, Esq., George R. Mesires, Esq., and Nile N. Park, Esq., at Ungaretti & Harris LLP. The Debtor estimated assets of $100 million to $500 million and liabilities of $10 million to $50 million at the time of the filing. The Debtor filed a Chapter 11 plan on Sept. 11, 2010. A copy of that plan is available at http://bankrupt.com/misc/OLDEPRAIRE_Plan.pdfat no charge. The Court previously found that the total value of the Real Properties and the Parking Lease was $81,150,000, far more than the $48,000,000 that CenterPoint claims to be owed by the Debtor. PACIFIC INTERESTS: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Pacific Interests Partners LP 11720 West Airport Blvd., Ste 800 Stafford, TX 77477 Bankruptcy Case No.: 11-34022 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Christopher M. Pham, Esq. CHRISTOPHER M. PHAM LAW GROUP, PLLC 11700 West Airport Blvd., Ste 800 Stafford, TX 77477 Tel: (281) 564-7900 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Christopher M. Pham, authorized signatory. PACIFIC RUBIALES: Moody's Assigns First Time 'Ba3' CFR ------------------------------------------------------ Moody's Investors Service assigned a first-time Corporate Family Rating of Ba3 to Pacific Rubiales Energy Corp. The outlook is positive. "The Ba3 rating for PRE reflects the scale of its oil-focused reserves and production, a favorable leverage position, the company's track record in overcoming infrastructure constraints and achieving production growth in the past three years, and a technically capable and seasoned management team," said Tom Coleman, Moody's Senior Vice President. "Our positive outlook considers the expectation that the company's growth pattern will continue as it develops its prospects while also working towards a long-term solution to replace its core Rubiales and Piriri production before those concessions expire in 2016." RATINGS RATIONALE PRE's substantial heavy oil reserves and strong production growth are key supports for the Ba3 rating. Despite a relatively short operating record in its current corporate form, the company has alleviated numerous infrastructure issues and staged sizeable production growth since early 2008. After achieving year-over-year production growth of 59% in 2009 and 67% in 2010, PRE has established itself as the second largest oil and gas producer in Colombia following Ecopetrol S.A. As of year-end 2010, the company's scale and leverage profile compare favorably to or lower than some similarly rated peer companies, with net proved reserves of 263 million BOE (proforma for post-2010 reserve additions), debt per proved developed (PD) reserves of $6.40 per BOE, and average daily production of $15,300 per BOE. In addition, Moody's anticipates that PRE's capital spending for 2011 will be internally funded and should result in leverage improving by the end of the year. At the same time, the Ba3 rating is constrained by the concentration of PRE's reserves and production, which are predominantly in Colombia, and by the potential expiration in 2016 of the contract concessions for its interests in the Rubiales and Piriri fields. These concessions contributed 75% of the company's production in 2010 and represent a significant portion of its future production growth. To maintain and grow its reserves and production, the company will likely need to secure new parallel contracts to replace the expiring concessions and establish other sources of production such as through the secondary recovery project on the Quifa oil field using its STAR (Synchronized Thermal Additional Recover) pilot technology. In addition, significant investment will be needed to build sufficient takeaway capacity to support future production growth. The positive outlook reflects Moody's expectation that PRE's production and reserve volumes will stay on course to achieve scale in reserves and production compatible with a higher rating. Leverage would also need to remain in the area of $7.00/BOE on PD reserves. Moody's could consider an upgrade to Ba2 as PRE demonstrates production growth from the ongoing Rubiales/Piriri field developments as well as from the Quifa field, which will be subject to PRE's STAR pilot testing. While there is no guarantee that the STAR program will generate significantly positive results, its adoption has the potential to contribute alternate potential production and reserves from known resources. Alternatively, the outlook could be returned to stable if the company is unable to attain its production growth target of 100 Mboe/d and if leverage on PD reserves cannot be maintained in the area of $7.00/BOE. The outlook could also be pressured if the STAR pilot testing program proves to be ineffective. Most notably, given the importance of the Rubiales/Piriri production, any indications in the medium-term that PRE would not be able to secure parallel contracts for the expiring concessions or establish sufficient alternative production sources would likely be negative for the rating. The principal methodology used in rating Pacific Rubiales was the Independent Exploration and Production (E&P) Industry Methodology, published December 2008. Pacific Rubiales, a Canadian-based company and producer of natural gas and heavy crude oil, owns Meta Petroleum Corp., the Colombian entity that operates the Rubiales/ Piriri and Quifa oil fields in the Llanos Basin in association with Ecopetrol, S.A.; and Pacific Stratus Energy Colombia Corp., which operates the wholly-owned La Creciente gas field in the northern part of Colombia and other light and medium oil fields. PARLAY ENTERTAINMENT: Taps BDO Canada to Assist in Restructuring ---------------------------------------------------------------- The Board of Directors of Parlay Entertainment Inc. has appointed BDO Canada Limited ("BDO") to assist it in a restructuring and to act as its Proposal Trustee in the filing of a Notice of Intention to make a Proposal to its creditors (the "BIA Filing") with the Superior Court of Justice, Province of Ontario, pursuant to the Bankruptcy and Insolvency Act (Canada) (the "BIA"). As part of the BIA Filing, the Company advises that it has agreed to borrow from MPProjects Assets S.A. ("MPProjects"), an aggregate amount of up to $500,000 by way of draw down credit financing (the "Credit Agreement") such financing to provide MPProjects with a second ranking charge encumbering the universality of Parlay's property wherever located. As part of its services, BDO will assist Parlay to restructure and such restructuring will consider a number of strategic options, including the possibility of an offer for the shares of the Company or an offer for the purchase of all or substantially all of the Company's assets. The Company advises that MPProjects has expressed an interest in making an offer to purchase substantially all of the Company's assets and has provided a deposit with BDO in the amount of $100,000 as evidence of its intention to do so. The Board of Directors also advises that Parlay has not filed its annual audited consolidated financial statements in accordance with the requirement to do so by May 2, 2011 (the "Deficiency"), with the Canadian securities regulators. As such, the Company anticipated that its shares would be suspended from trading until such time that the Deficiency can be remedied and the Cease Trade Order was issued on May 5, 2011. The Board of Directors will update shareholders on both matters as soon as it is appropriate to do so. About Parlay Entertainment Parlay Entertainment Inc. is one of the pioneers and technology leaders in the online gaming industry. As the inventor and holder of Internet bingo patents, Parlay was the first company in the world to develop and deploy a commercial Internet bingo product. Parlay's head offices are located in Oakville, Canada. Parlay is licensed or certified to conduct business in Alderney, the United Kingdom and the Isle of Man. PATIO MARKET: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Patio Market, Inc. 32240 W. Jefferson Rockwood, MI 48173 Bankruptcy Case No.: 11-52851 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Eastern District of Michigan (Detroit) Judge: Walter Shapero Debtor's Counsel: Robert N. Bassel, Esq. P.O. Box T Clinton, MI 49236 Tel: (248) 677-1234 Fax: (248) 369-4749 E-mail: bbassel@gmail.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by George Shammas, president. PATRIOT COAL: S&P Affirms 'B+' CCR; Outlook Negative ---------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings, including its 'B+' corporate credit rating, on Patriot Coal Corp. At the same time, Standard & Poor's is removing all ratings from CreditWatch, where they were placed with negative implications on Dec. 6, 2010. The rating outlook is negative. The affirmation and CreditWatch removal reflect Standard & Poor's expectations that 2011 EBITDA will be about $250 million, resulting in adjusted debt to EBITDA of about 4.5x and funds from operations (FFO) to adjusted debt of about 11%. "Higher costs and lower thermal coal production because of unfavorable geological conditions have caused results to fall below previous 2011 expectations," said Standard & Poor's credit analyst Maurice Austin. "However, in our view, the revised expectations remain consistent with the 'B+' rating. Nonetheless, our rating outlook is negative, reflecting current credit metrics, cost pressures from ongoing operating disruptions, compliance with regulatory and safety mandates, and escalating mining costs." The 'B+' corporate credit rating on Patriot Coal reflects the combination of its weak business risk profile and aggressive financial risk profile. The company has significant exposure to the high-cost Central Appalachia (CAPP) region and faces challenges posed by the inherent risks of coal mining, including operating problems, price volatility, and increasing costs and regulatory scrutiny. The company possesses large legacy liabilities but has adequate liquidity, in Standard & Poor's view, to meet its near-term obligations. Patriot produced slightly more than 30 million tons of coal in 2010, making it one of the top 10 coal producers in the U.S. However, with a majority of its production originating from CAPP, the company is subject to the issues inherent to CAPP coal mining operations, such as depleting reserves, narrowing coal seams, increased regulatory issues, and permitting challenges, which somewhat increases the company's overall credit risk. PECAN SQUARE: Files Schedules of Assets and Liabilities ------------------------------------------------------- Pecan Square, Ltd. filed with the U.S. Bankruptcy Court for the Southern District of California, its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $0 B. Personal Property $35,215 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $9,050,609 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $434,877 ----------- ----------- TOTAL $35,215 $9,484,877 Dallas, Texas-based Pecan Square, Ltd., a California Limited Partnership, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Calif. Case No. 11-05359) on March 31, 2011. Illyssa I. Fogel, Esq., at the Law Office of Illyssa I. Fogel, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. PINE MOUNTAIN: Court Converts Case to One Under Chapter 7 --------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Tennessee has granted the U.S. Trustee for Region 8's request to convert the Chapter 11 case of Pine Mountain Properties LLC to one under Chapter 7 of the Bankruptcy Code. The U.S. Trustee previously asserted that the Debtor's estate has no likelihood of rehabilitation. About Pine Mountain Properties, LLC Maryville, Tennessee-based Pine Mountain Properties, LLC, dba Pine Mountain Properties, a limited liability corporation, was formed to develop residential golf course community in Cambell County on approximately 4,800 acres. At present, the golf course is approximately 90% complete. The Company filed for Chapter 11 bankruptcy protection (Bankr. E.D. Tenn. Case No. 10-31898) on April 14, 2010. Jenkins & Jenkins Attorneys, PLLC represents the Debtor in its restructuring effort. The Debtor disclosed $20,077,150 in assets and $15,560,226 in liabilities as of the Petition Date. PEREGRINE DEVELOPMENT: Case Summary & 3 Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: Peregrine Development, LLC 2552 South Stemmons Lewisville, TX 75067 Bankruptcy Case No.: 11-41449 Chapter 11 Petition Date: May 3, 2011 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Debtor's Counsel: Michael R. Rochelle, Esq. ROCHELLE MCCULLOUGH L.L.P. 325 N. St. Paul St., Ste 4500 Dallas, TX 75201 Tel: (214) 953-0182 Fax: (214) 953-0185 E-mail: buzz.rochelle@romclawyers.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Arthur James, II, manager. Debtor's List of three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Passman & Jones Legal services $70,000 1201 Elm Street Suite 2500 Dallas, TX 75270 Graham Associates, Inc. Trade services $31,000 600 Six Flags Drive Suite 500 Arlington, TX 76011 Covad Communications Utility services $600 222 West Las Colinas Blvd. Irving, TX 75039 PONTIAC CITY: Moody's Cuts Rtng to 'Caa1' Over June Default Risk ---------------------------------------------------------------- Moody's Investors Service has downgraded the general obligation limited tax rating for Pontiac Building Authority (MI) to Caa1 from B2. The rating has been removed from watchlist and the outlook has been revised to negative. The Caa1 rating applies to $615,000 in outstanding lease rental bonds that are secured by the City of Pontiac's general obligation limited tax pledge. SUMMARY RATINGS RATIONALE The downgrade of the Pontiac's GOLT rating to Caa1 reflects the city's extremely limited liquidity that presents a heightened risk of payment default on debt service due in June and thereafter, several consecutive years of negative General Fund balances exacerbated by deficits in various other funds requiring General Fund support, and uncertainty surrounding management's plans to stabilize the city's financial position. The Caa1 rating also considers the severely challenged local economy, which is heavily concentrated in the automotive industry, and significant tax appeals. The negative outlook reflects the likelihood that the city's financial position will continue to deteriorate due to greater than anticipated revenue shortfalls, additional tax appeals further pressuring declining valuations and shrinking revenues, and lack of information which ultimately questions the city's ability to make timely debt service payments. STRENGTHS -- Passage of new legislation gives Emergency Manager (EM) and city some additional operating flexibility -- Transfer of Police Department to the county and recent negotiation with fire department that reduces mandatory manning relieves some expenditure pressures WEAKNESSES -- Potential cash flow issues, information unavailable -- Limited resources and uncertainty of revenues available to meet debt service payments -- Weak financial operations with General Fund deficits expected to continue -- General Motors (GM) tax appeal settlement; city liable for refund and valuation adjustments -- Weak economy expected to remain stressed DETAILED CREDIT SUMMARY UNCERTAINTY OF CITY'S ABILITY TO MAKE TIMELY DEBT SERVICE PAYMENTS DUE TO EXTREMELY LIMITED LIQUIDITY AND LACK OF INFORMATION Due to consecutive years of deficit balances in the General Fund and other funds, pressured revenue streams, and narrow liquidity with limited cash flow information, it is unclear from which funds debt service will be paid. The city has $9.5 million in debt service coming due on June 1, 2011. As of June 30, 2010, the city had $17.5 million in available cash across all funds. While officials indicate that there is currently enough cash on hand to make the upcoming June 1, 2011 debt service payments, limited cash flow information makes it difficult to determine whether internal liquidity is sufficient to support overall operations and repayment of debt. Officials also question the availability of future revenues to support operations and debt service payments in fiscal 2012 and beyond. The city's ability to identify and segregate funds for debt service payments versus operations, and manage overall cash flow will be an important factor in the city's credit rating. The city of Pontiac has $68.8 million in general obligation limited tax debt outstanding and $7.6 million in TIFA revenue debt outstanding. Of the GOLT debt outstanding, Moody's currently rates only $615,000 in Series 2002 General Building Authority Bonds. Principal amortization of the city's general obligation debt is rapid, with 91.6% coming due within ten years. All of the city's debt is fixed rate and there is no exposure to derivative or swap contracts. DEFICIT FINANCIAL POSITION AND LIMITED FISCAL OPTIONS CONTINUE TO CHALLENGE MANAGEMENT Pontiac's financial operations have continued to deteriorate over the years, exacerbated by the current economic recession. The city faces a severe structural budget gap due to consecutive years of spending beyond budgeted levels stemming from mandated costs such as health care, and annual declines in major revenue streams such as property taxes, state shared revenues, and various fees and charges. There have also been numerous instances of accounting and financial reporting shortcomings, including an $8 million restatement in fiscal year 2004 for prior periods. In response to the city's financial distress, the Governor appointed an Emergency Financial Manager (EFM) over two years ago to oversee all of the city's financial operations for a one year period beginning March 1, 2009. A replacement EFM was appointed in June 2010 and a deficit elimination plan (DEP) was released on Sept. 1, 2010. Among several options to address the General Fund's deficit position, per statute, the EFM may recommend applying for federal bankruptcy protection under Chapter 9 of the US Bankruptcy Code, although this has not been considered to date. The EFM's Sept. 1, 2010 report noted additional liabilities unaccounted for in the audit, including uncollected taxes and a pending tax appeal by General Motors. Although the audit reported a modest $700,000 General Fund surplus, this surplus was supported by several one-time revenues, and did not include the tax liabilities noted by the EFM. The city initially passed a balanced budget for fiscal 2011; however, the EFM report projected an $8.8 million operating deficit in the General Fund and proposed several measures to narrow this gap. These proposals included a request to increase contributions for pension and other post employment retirement benefits (OPEB), layoffs, privatization of various administrative processes, and contracting for police services with Oakland County while eliminating the city's police department. Without implementation of any of the proposed reductions, the EFM's September 2010 report projected a negative $9.7 million General Fund balance (30% of revenues) in fiscal 2012, with the deficit balance growing to a negative $17.4 million (negative 50% of revenues) through fiscal 2013. The state passed new legislation in March 2011 entitled the Local Government and School District Accountability Act, which gives Emergency Managers (EM) broad sweeping powers including suspension of labor contracts, freezing of non-union salaries, selling of assets, and the ability to increase the operating rate by one mill with the vote of the electorate. These additional powers enabled Pontiac's EFM to take significant measures to reduce expenditures. Eighty positions were eliminated and certain city services were privatized. The transfer of the city's police force to the county occurred in March 2011 and is expected to generate $2 million in savings annually. In addition, the EFM was able to successfully negotiate with the Fire Union to reduce the manning requirement from 24 to 20, generating an additional $1 million in savings. As a result, the EFM projects a slight improvement in the General Fund balance to negative $2.5 million (negative 6.5% of revenues) for fiscal year-end 2011. Declining revenues and limited expenditure reducing flexibility continue to exacerbate the city's ability to maintain operations. General Fund revenues declined by 5.4% in 2009 and an additional 11% in 2010. The city's General Fund operating revenues consist of property taxes (56.1%) and state aid (26%), followed by charges for service and licenses and fees (8.2%) as of fiscal 2010. Property taxes are expected to continue to decline as valuations contract, state shared revenues will likely drop due to budgetary pressures at the State level, and fees are predicted to narrow due to weaker economic activity. The city is operating at its statutory maximum millage rates. The EFM anticipates a greater deficit in fiscal 2012 despite the substantial expenditure reductions. The EFM has no plans currently to pursue an increase in the operating mill rate. In addition, the realistic long-term benefits of the new legislation are uncertain, as many actions require final approval by the state, and the EFM powers may be overburdened by increased administrative duties as required by the state. NARROW LIQUIDITY EXPECTED TO WORSEN Liquidity for day-to-day governmental operations is provided by interfund loans, primarily from the enterprise funds, internal service funds, and from other component units. Reserves in the city's other funds have been depleted over the years. At the close of fiscal 2010, the city had available approximately $17.5 million across all funds. However, as revenues in these funds face similar challenges as General Fund revenues, liquidity is expected to continue to deteriorate, placing pressure on the city's ability to manage daily operations. In addition to a negative General Fund balance, the city's other funds are pressured as well. The city's Parking Fund recorded a negative $835,000 balance and the city's Golf Course Fund recorded a negative $30,381 at the close of fiscal 2010. It is expected that these funds will require future support from the already strained General Fund. As liquidity declines, it remains unclear how the city will manage future financial operations. WEAK DEMOGRAPHIC TRENDS PERSIST; FURTHER PRESSURED BY CURRENT ECONOMIC CONDITIONS The city's pressured financial situation is in part due to the significantly adverse local economic conditions. Located in Oakland County (general obligation rated Aaa), the City of Pontiac serves as the county seat and major industrial center for the area. The city's demographic profile remains one of the weakest in the nation. Over the past five decades, Pontiac's population has fallen by nearly 25%. Despite a contracted labor force, unemployment levels have remained persistently high. The city's February 2011 unemployment rate was 25.1%, more than twice the state's 11% rate for the same period. Economic challenges are also evidenced by the high rate of home foreclosures at nearly 5%, and poverty levels that persist at rates more than twice the state average. Wealth indices continue to decline with per capita and median family incomes at 54.5% and 63.8% of the nation, respectively. SIGNIFICANT GENERAL MOTORS CONCENTRATION; CONTINUED TAX APPEALS PRESSURE EXPENDITURES AND REVENUES General Motors (B1/stable outlook) is the city's largest employer (17,200 employees) and taxpayer comprising approximately 25% of the city's taxbase in 2009 (down from 35% in 2005). Pontiac is home to both research and development for GM and houses several facilities of the company. The city has suffered from the massive contraction of the automotive industry. GM closed the Pontiac Assembly Plant in October 2009 and placed the Pontiac Stamping Plant on standby capacity in December 2010 as part of its company- wide restructuring efforts. GM continues to appeal taxes and valuations. The city recently agreed to a settlement with GM and is now required to repay $4 million of property taxes overpaid during the past few years and valuations will be adjusted downward going forward. As the city's resources are limited, the refund liability competes with revenues available for operations and debt service expenditures. While the city has the option to issue bonds to repay GM, final approval from a judge would be necessary, and the city has no intention to pursue this option at this time. The city expects to pay the $4 million over four years, with annual payments of $1 million through 2014. The city has reserved the entire $4 million with a $1 million due in 2011. The city intends to use the extra funds available to help meet cash flow and debt service needs in fiscal 2012. Going forward, the city's taxable valuation is expected to decline even further due to adjustments, thus affecting the amount of property tax revenues the city is able to collect. Outlook The negative outlook reflects Moody's opinion that Pontiac's operations will remain extremely pressured, increasing the potential that it may not meet its debt service payments or eliminate the accumulated General Fund deficit in the near term. The city's liquidity is expected to continue to deteriorate due to revenue and expenditure pressures, exacerbated by its shrinking population and taxbase. Future credit reviews will focus on the city's ability to stabilize financial operations and make timely debt service payments. WHAT COULD CHANGE THE RATING UP (OR REVISE OUTLOOK TO STABLE) -- Disciplined expenditure reductions coupled with strengthened on-going revenue streams to eliminate deficit position -- Dramatic improvement in regional economy and employment levels; taxbase diversification -- Significant improvement in liquidity -- Successful negotiation results with unions WHAT COULD CHANGE THE RATING DOWN -- Revenue challenges that continue to exceed expenditure solutions -- Continued operating deficits further straining narrow liquidity -- Further increase of the city's leveraged debt position -- Prolonged tax base erosion -- Failure to make timely debt service payments on general obligation bonds KEY STATISTICS -- 2000 Census population: 66,337 (6.4% decline from 2000) -- Estimated 2008 population: 66,095 (0.4% decline from 2000) -- Per capita income, % of US: 63.8% -- Median family income, % of US: 54.5% -- Unemployment (February 2011): 25.1% (compared to 11% state and 9.5% national rates) -- Full valuation: $2.7 billion -- Full value per capita: $40,544 -- Ten largest property tax payers as a % of taxable valuation: 28.8% -- Debt burden: 3.5% -- Overall debt burden: 6.7% -- Fiscal 2010 General Fund balance: negative $4.1 million (- 9.9% of General Fund revenues) -- Total GOLT debt outstanding: $20.1 million -- Total TIFA revenue debt outstanding: $7.6 million -- Moody's rated GOLT debt outstanding: $615,000 PRINCIPAL METHODOLOGY The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. PQ CORP: S&P Affirms 'B' CCR; Outlook Revised to Stable ------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Malvern, Pa.-based PQ Corp. to stable from negative. At the same time, Standard & Poor's affirmed all its ratings, including the 'B' corporate credit rating, on the company. "The stable outlook reflects our belief that improving demand, cost efficiencies, and growth investments will enable PQ to continue to increase profitability and improve credit measures over the next few quarters," said Standard & Poor's credit analyst Ket Gondha. "Although free cash flow will be minimal, we expect earnings growth to drive improvement to credit measures. We also expect that management will pursue financial policies including any acquisition plans that do not leverage the credit profile beyond current levels." PQ is a specialty chemical producer that manufactures and markets inorganic specialty chemicals and specialty catalysts. The company produces several specialty chemical products, including sodium silicate, magnesium sulfate, zeolites, polyolefin catalysts, and other industrial chemicals. PQ also is the parent of Potters Holdings II LP (preliminary B/Stable/--), a maker of glass beads for various industrial applications. Consolidated earnings for PQ (including Potters) were greater than $1 billion for fiscal 2010. PQ will likely close on separation financing for Potters in the next few weeks. Pro forma for the separation, 2010 revenues for PQ were greater than $800 million. The ratings on PQ Corp. reflect the company's highly leveraged financial profile and a fair business position, according to Standard & Poor's. The Carlyle Group is the majority owner of PQ, with very aggressive financial policies. PQ's business profile is characterized by well-established market positions, meaningful geographic diversity, a largely inorganic raw material base, and high operating margins. Although the unusual severity and global nature of the economic downturn depressed volumes and earnings, PQ's business strengths have contributed to a recovery in operating performance. The company has a No. 1 market position in product lines that make up more than 85% of sales and the No. 2 position in products that comprise most of the remaining sales. In sodium silicate, its single largest product category by sales, PQ holds a major portion of the North American market and a strong position in the European market. Meaningful geographic diversity further supports the fair business profile. More than half of the company's sales are from overseas markets, principally in Europe. RADIENT PHARMACEUTICALS: Presented at Aegis Capital Conference -------------------------------------------------------------- Radient Pharmaceuticals Corporation announced that its Chairman and CEO, Mr. Douglas MacLellan and Mr. Akio Ariura, RPC's Chief Operating Officer and CFO, served as the lead presenters during the main evening reception at this year's Aegis Capital Emerging Growth Conference, Thursday, April 28, 2011. The conference was held at the Palazzo Hotel in Las Vegas, NV. RPC's executives discussed Radient Pharmaceutical's latest business developments, including clinical test results for its US FDA-cleared Onko-Sure(R) in vitro diagnostic (IVD) cancer test. Additionally, the two executives shared recent Company achievements, market position, new business initiatives and FY2011 - FY2012 growth plans. 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 Aug. 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 Dec. 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. RASER TECHNOLOGIES: Files Copy of Plan Support Agreement -------------------------------------------------------- As reported in the TCR on May 2, 2011, Raser Technologies, Inc., together with its wholly-owned subsidiaries entered into a Plan Support and Restructuring Agreement, dated as of April 28, 2011, with Linden Capital, L.P. ("Linden"), Tenor Opportunity Master Fund Ltd., Aria Opportunity Fund Ltd., Parsoon Opportunity Fund Ltd. (collectively, "Tenor" and with Linden, the "Sponsors"), and The Prudential Insurance Company of America ("Prudential"), Zurich American Insurance Company (collectively with Prudential, the "Thermo Lenders") and Deutsche Bank Trust Company Americas. The Sponsors hold, in the aggregate, nearly 50% of the outstanding principal amount of the Company's 8% Convertible Senior Notes Due 2013. Pursuant to the Plan Support Agreement, the Sponsors and the Thermo Lenders agreed to vote in favor of and support a plan of reorganization proposed by the Company under the Bankruptcy Code. The Sponsors also agreed to make a debtor-in-possession loan facility available to Company, in the aggregate amount of approximately $8.75 million, to fund, among other things, the Company's working capital needs during the bankruptcy cases. The DIP Facility contemplates that the Company will be able to draw down up to $750,000 on an interim basis, with the remainder available only after final approval of the U.S. Bankruptcy Court for the District of Delaware is obtained, and certain other conditions are satisfied as set forth in the Plan Support Agreement. The Plan Support Agreement and the DIP Facility may be terminated by the Sponsors under certain circumstances, including the Bankruptcy Court's failure (i) by May 4, 2011, to enter an Interim Order approving the DIP Facility, (ii) by May 20, 2011, to enter the Final Order approving the DIP Facility, (iii) by Aug. 11, 2011, to enter an order confirming the Plan. The Bankruptcy Court, on May 3, 2011, entered its Interim Order approving the DIP Facility, and set May 19, 2011, at the date for the hearing on the Final Order. A copy of the Plan Support Agreement is available for free at: http://is.gd/vnr8xX About Raser Technologies, Inc. Provo, Utah-based Raser Technologies, Inc., also known as Wasatch Web Advisors, Inc., filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-11315) on April 29, 2011. Other Debtor affiliates filed for separate Chapter 11 protection on April 29, 2011, (Bankr. Case Nos. 11-11319 - 11-11350). Peter S. Partee, Sr., Esq., and Richard P. Norton, Esq., at Hunton & Williams LLP represent the Debtors in their restructuring efforts. The Debtors' local counsel is Bayard, P.A. Sichenzia Ross Friedman Ference LLP serves as the Debtors' corporate counsel. The Debtors' financial advisor is Canaccord Genuity. The Debtors disclosed $41.8 million in assets and $107.8 million in debts as of Dec. 31, 2010. The Company reported a net loss of $101.80 million on $4.25 million of revenue for the fiscal year ended Dec. 31, 2010, compared with a net loss of $20.90 million on $2.19 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $41.84 million in total assets, $107.78 million in total liabilities, $5.00 million of Series A-1 cumulative convertible preferred stock, and a stockholders' deficit of $70.94 million. REALOGY CORP: Bank Debt Trades at 4% Off in Secondary Market ------------------------------------------------------------ Participations in a syndicated loan under which Realogy Corp. is a borrower traded in the secondary market at 95.88 cents-on-the- dollar during the week ended Friday, May 6, 2011, an increase of 0.45 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 300 basis points above LIBOR to borrow under the facility. The bank loan matures on Sept. 30, 2013, and carries Moody's B1 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. 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. In February, Standard & Poor's Ratings Services raised its corporate credit rating on Realogy Corp. to 'CCC' from 'CC'. The rating outlook is positive. REVLON CONSUMER: Meets with Lenders on Possible Refinancing ----------------------------------------------------------- Given current market conditions, as part of Revlon Consumer Products Corporation's strategy to continue to improve its capital structure, on May 2, 2011, Revlon Consumer Products Corporation, Revlon, Inc.'s wholly owned operating subsidiary, scheduled a meeting with a group of potential lenders to discuss a possible refinancing of its existing 2010 bank term loan facility. There can be no assurances that any such refinancing will be consummated. RCPC was in compliance with all applicable covenants under its existing 2010 bank term loan agreement as of March 31, 2011 and the date of this filing. About Revlon Consumer Headquartered in New York, Revlon Consumer Products Corporation is a worldwide cosmetics, skin care, fragrance, and personal care products company. The company is a wholly-owned subsidiary of Revlon, Inc., which is majority-owned by MacAndrews & Forbes, which is in turn wholly-owned by Ronald O. Perelman. Revlon's net sales for the twelve-month period ended December 2009 were approximately $1.3 billion. M&F beneficially owns approximately 77.4% of Revlon's outstanding Class A common stock, 100% of Revlon's Class B common stock and 78.8% of Revlon's combined outstanding shares of Class A and Class B common stock, which together represent approximately 77.2% of the combined voting power of such shares. As reported by the TCR on Dec. 2, 2010, Standard & Poor's Ratings Services said that it raised its corporate credit rating on Revlon Consumer Products Corp. to 'B+' from 'B'. "S&P raised the ratings on Revlon Consumer Products Corp. to reflect the continued improvements in operating performance, credit metrics, and its enhanced liquidity profile," said Standard & Poor's credit analyst Susan Ding. In April 2011, Moody's Investors Service upgraded Revlon Consumer Products Corporation's Corporate Family and Probability of Default ratings to B1 from B2. The upgrade of Revlon's Corporate Family rating to B1 reflects the company's ability to sustain operating and financial momentum despite the ongoing challenges of the macroeconomic environment and intensified competitive environment. Revlon's credit metrics continue to improve modestly driven by strong profitability and cash flow generation with further gains expected in fiscal 2011. The Company's balance sheet at March 31, 2011 showed $1.14 billion in total assets, $1.78 billion in total liabilities, and a $644.30 million total stockholders' deficiency. REVLON INC: RCPC Meets with Lenders for Possible Debt Refinancing ----------------------------------------------------------------- Given current market conditions, as part of Revlon, Inc.'s strategy to continue to improve its capital structure, on May 2, 2011, Revlon, Inc.'s wholly owned operating subsidiary, Revlon Consumer Products Corporation, scheduled a meeting with a group of potential lenders to discuss a possible refinancing of its existing 2010 bank term loan facility. There can be no assurances that any such refinancing will be consummated. RCPC was in compliance with all applicable covenants under its existing 2010 bank term loan agreement as of March 31, 2011 and May 2, 2011. About Revlon Inc. Headquartered in New York City, Revlon, Inc. (NYSE: REV) -- http://www.revloninc.com/-- is a worldwide cosmetics, hair color, beauty tools, fragrances, skincare, anti-perspirants/deodorants and personal care products company. The Company's brands, which are sold worldwide, include Revlon(R), Almay(R), Mitchum(R), Charlie(R), Gatineau(R), and Ultima II(R). The Company's balance sheet at March 31, 2011, showed $1.10 billion in total assets, $1.79 billion in total liabilities and a $686.50 million in total stockholders' deficiency. ROBB & STUCKY: Cooley LLP Approved as Committee Lead Counsel ------------------------------------------------------------ The Official Committee of Unsecured Creditors in the Chapter 11 case of Robb & Stucky Limited LLLP has sought and obtained authority from the U.S. Bankruptcy Court for the District of Florida to retain Cooley LLP as its lead counsel nunc pro tunc to Feb. 25, 2011. The Court notes in its order that Cooley will not perform any service in connection with the investigation or prosecution of any claims of or causes of action against CIRS Financing LLC or CIRS Management LLC. About Robb & Stucky Sarasota, Florida-based Robb & Stucky Limited LLLP -- dba Robb & Stucky; Robb & Stucky Interiors; Fine Design Interiors, a division of Robb & Stucky; Robb & Stucky Patio; R&S Home of Fine Decorators; and Home of Fine Design by Robb & Stucky -- is a retailer of upscale, high-end, interior-design-driven home furnishings in the U.S. It filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 11-02801) on Feb. 18, 2011. Paul S. Singerman, Esq., and Jordi Guso, Esq., at Berger Singerman PA, serve as the Debtor's bankruptcy counsel. FTI Consulting, Inc., is the Debtor's advisor and Kevin Regan is the Debtor's chief restructuring officer. Bayshore Partners, LLC, is the Debtor's investment banker. AlixPartners, LLP, serves as the Debtor's communications consultants. Epiq Bankruptcy Solutions, LLC, serves as the Debtor's claims and notice agent. In its schedules, the Debtor disclosed $77,705,081 in assets and $91,859,125 in liabilities as of the Chapter 11 filing. ROBB & STUCKY: Committee Retains Broad & Cassel as Local Counsel ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Florida has granted the Official Committee of Unsecured Creditors' request for authority to retain Broad and Cassel as local bankruptcy counsel. The Court, however, notes that Broad and Cassel will not perform any service in connection with the investigation or prosecution of any claims of or causes of action against CIRS Financing LLC or CIRS Management LLC. About Robb & Stucky Sarasota, Florida-based Robb & Stucky Limited LLLP -- dba Robb & Stucky; Robb & Stucky Interiors; Fine Design Interiors, a division of Robb & Stucky; Robb & Stucky Patio; R&S Home of Fine Decorators; and Home of Fine Design by Robb & Stucky -- is a retailer of upscale, high-end, interior-design-driven home furnishings in the U.S. It filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 11-02801) on Feb. 18, 2011. Paul S. Singerman, Esq., and Jordi Guso, Esq., at Berger Singerman PA, serve as the Debtor's bankruptcy counsel. FTI Consulting, Inc., is the Debtor's advisor and Kevin Regan is the Debtor's chief restructuring officer. Bayshore Partners, LLC, is the Debtor's investment banker. AlixPartners, LLP, serves as the Debtor's communications consultants. Epiq Bankruptcy Solutions, LLC, serves as the Debtor's claims and notice agent. In its schedules, the Debtor disclosed $77,705,081 in assets and $91,859,125 in liabilities as of the Chapter 11 filing. ROBB & STUCKY: Committee Retains BDO USA as Financial Advisor ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Florida has granted the Official Committee of Unsecured Creditors' request for authority to retain BDO Consulting, a division of BDO USA LLP as financial advisor nunc pro tunc to March 1, 2011. About Robb & Stucky Sarasota, Florida-based Robb & Stucky Limited LLLP -- dba Robb & Stucky; Robb & Stucky Interiors; Fine Design Interiors, a division of Robb & Stucky; Robb & Stucky Patio; R&S Home of Fine Decorators; and Home of Fine Design by Robb & Stucky -- is a retailer of upscale, high-end, interior-design-driven home furnishings in the U.S. It filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 11-02801) on Feb. 18, 2011. Paul S. Singerman, Esq., and Jordi Guso, Esq., at Berger Singerman PA, serve as the Debtor's bankruptcy counsel. FTI Consulting, Inc., is the Debtor's advisor and Kevin Regan is the Debtor's chief restructuring officer. Bayshore Partners, LLC, is the Debtor's investment banker. AlixPartners, LLP, serves as the Debtor's communications consultants. Epiq Bankruptcy Solutions, LLC, serves as the Debtor's claims and notice agent. In its schedules, the Debtor disclosed $77,705,081 in assets and $91,859,125 in liabilities as of the Chapter 11 filing. ROCKWOOD SPECIALTIES: Fitch Affirms Issuer Default Rating at 'BB' ----------------------------------------------------------------- Fitch Ratings has affirmed the Issuer Default Rating for Rockwood Specialties Group, Inc. at 'BB'. The Rating Outlook is Stable. Rockwood's ratings reflect leading positions in many of its product lines, diversification by market and end-use, good profit margins, and consistent generation of free cash flow. At March 31, 2011 cash on hand was $199 million and estimated availability under the $180 million revolver due Feb. 10, 2016 after estimated utilization of $34 million for letters of credit was $146 million. Fitch expects free cash flow generation, after $230 million in capital expenditures, to exceed $150 million annually and comfortably service debt. Current maturities are estimated as $52 million due in 2011, $52 million due in 2012, $250 million due in 2013 and $564 million due in 2014. Fitch expects some portion of the senior subordinated notes due in 2014 to be refinanced. Latest 12-month (LTM) operating EBITDA was $672 million, total debt to LTM operating EBITDA was 2.7 times (x), and LTM free cash flow was $268 million based on preliminary March 31, 2011 results. The senior secured credit facilities contain financial covenants. The maximum senior secured debt ratio of 2.75x is defined as net senior secured debt (total debt excluding senior subordinated notes plus capital lease obligations minus cash up to a maximum of $200 million) to adjusted EBITDA. Rockwood reported that it complied with the senior secured debt ratio covenant limit with a ratio of 1.45x for the period ending March 31, 2011. There is also a minimum interest coverage ratio of 2.50x defined as adjusted EBITDA to cash interest expense (interest expense, net excluding deferred debt issuance cost amortization and the movements in the mark-to-market value of the interest rate and cross-currency interest rate derivatives). Fitch estimates that Rockwood is well within compliance with this covenant. Fitch expects that the company will remain well within compliance with all its covenants. The Stable Outlook reflects Fitch's expectations that margins should remain stable, liquidity should remain ample, average annual free cash flow should exceed $150 million, and leverage should remain under 3x. Meaningful debt repayment could result in a positive rating action. Significant additional financial leverage associated with a sizable acquisition or a recapitalization would result in a review with negative rating implications. Fitch has taken these rating actions on Rockwood: -- IDR affirmed at 'BB'; -- Senior secured revolving credit facility affirmed at 'BB+'; -- Senior secured term loans affirmed at 'BB+'; -- Senior subordinated notes affirmed at 'BB-'. ROOKWOOD CORPORATION: Involuntary Chapter 11 Case Summary --------------------------------------------------------- Alleged Debtor: The Rookwood Corporation 1920 Race Street Cincinnati, OH 45202 Bankruptcy Case No.: 11-12756 Involuntary Chapter 11 Petition Date: May 4, 2011 Court: U.S. Bankruptcy Court Southern District of Ohio (Cincinnati) Judge: Jeffery P. Hopkins Petitioners' Counsel: Reuel D. Ash, Esq. ULMER & BERNE, LLP 600 Vine Street, Suite 2800 Cincinnati, OH 45402-2409 Tel: (513) 698-5118 Fax: (513) 698-5119 E-mail: rash@ulmer.com Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Sharri Rammelsberg Promissory Note $105,000 P.O. Box 58181 Cincinnati, OH 45258 Alfred J. Berger, Jr. Promissory Note $98,250 2575 Queen City Avenue Cincinnati, OH 45238 Christopher Rose Promissory Note $56,078 57 Mulberry Street Cincinnati, OH 45202 ROOSEVELT AVENUE: Case Summary & 13 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Roosevelt Avenue Corp. 251-11 Northern Boulevard, Suite 5A Little Neck, NY 11362 Bankruptcy Case No.: 11-43782 Chapter 11 Petition Date: May 4, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Carla E. Craig Debtor's Counsel: Mark A. Frankel, Esq. BACKENROTH FRANKEL & KRINSKY LLP 489 Fifth Avenue, 28th Floor New York, NY 10017 Tel: (212) 593-1100 Fax: (212) 644-0544 E-mail: mfrankel@bfklaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 13 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nyeb11-43782.pdf The petition was signed by Daniel Lee, president. RSM RESIDENTIAL: Taps Schwartzer & McPherson as Bankr. Counsel -------------------------------------------------------------- RSM Residential Properties, LLC, seeks permission from the Bankruptcy Court to employ as its bankruptcy counsel: Lenard E. Schwartzer, Esq. Jeanette E. McPherson, Esq. SCHWARTZER & MCPHERSON LAW FIRM 2850 South Jones Boulevard, Suite 1 Las Vegas, NV 89146-5308 Telephone: (702) 228-7590 Facsimile: (702) 892-0122 E-Mail: bkfilings@s-mlaw.com A hearing on the Debtor's application is set for June 1, 2011, at 9:30 a.m. The Firm's hourly rates are: Attorneys Lenard E. Schwartzer, Esq. $500 Jeanette E. McPherson, Esq. $400 Jason A. Imes, Esq. $300 Emelia L. Allen, Esq. $200 Paralegal/Legal Assistant Angela Hosey $125 Sheena Clow $125 The Firm has received a retainer of $50,000. The Firm has no connections with parties-in-interest in the Debtor's case and the Debtor does not believe the Firm represents any interest which would be adverse to it or the bankruptcy estate, and its employment would be in the best interests of the estate. Las Vegas-based RSM Residential Properties, LLC, owns real property located at 31971 Trabuco Canyon road, Trabuco Canyon, California. The Property is planned to consist of roughly 198 single family residential lots within the County of Orange, California. It filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case No. 11-16344) on April 27, 2011. Judge Mike K. Nakagawa presides over the case. It scheduled $57,001,338 in assets and $36,498,761 in liabilities. The petition was signed by Mitchell and Melissa Ogron, co-trustees of MMO Living Trust Dated 8/22/02, manager. SCOTSMAN INDUSTRIES: Moody's Assigns B1 to $60MM Incremental Loan ----------------------------------------------------------------- Moody's Investors Service affirmed the B1 Corporate Family Rating (CFR) and B1 Probability of Default Rating (PDR) of Scotsman Industries, Inc. (Scotsman). Concurrently, Moody's affirmed the B1 ratings on the company's existing $30 million senior secured revolving credit facility and $115 million senior secured term loan, and assigned a B1 rating to the company's new $60 million incremental term loan. The company's rating outlook remains Stable. The B1 ratings balance Scotsman's improving operational performance, good coverage metrics, and strong market share against its small size, and the increase in leverage following a special dividend to shareholders funded by the incremental term Loan. The ratings benefit from the company's position as a pure play ice machine maker with an entrenched market position and significant replacement revenues in North America, Western Europe, and Asia. The ratings contemplate a slow growth environment in the company's primary markets which will support continued free cash flow generation. Assignments: Issuer: Scotsman Industries, Inc. -- Senior Secured $60 incremental Senior Secured Term Loan B, Assigned a B1, LGD3-48% Affirmation: -- $30 million Senior Secured Revolver, Affirmed at B1, LGD3- 48% -- $115 million Senior Secured Term Loan B, Affirmed at B1, LGD3-48% The rating outlook is stable. The stable outlook reflects the view that while the company's credit metrics are strong for the B1 rating and that Scotsman should delever through free cash flow, its metrics are unlikely to support an upgrade over the next year given the company's size, product concentration, and dividend history. Moody's last rating action on Scotsman was on April 15, 2010 when the rating agency assigned a B1 CFR and PDR to the company along with a stable rating outlook. Scotsman Industries, Inc., headquartered in Vernon Hills, IL, is a global manufacturer of commercial, industrial, and high-end ice machines and related products. Revenue for the LTM period ended 2/28/11 was approximately $285 million. SCOTSMAN INDUSTRIES: S&P Retains 'B+' Rating on Upsized Term Loan ----------------------------------------------------------------- Standard & Poor's Ratings Services kept unchanged its 'B+' issue- level rating with a '3' recovery rating on Vernon Hills, Ill.- based Scotsman Industries Inc.'s add-on of a $60 million incremental term loan to its existing debt. "Our 'B+' corporate credit rating on the company also remains unchanged. The company will use the proceeds to fund a dividend to private equity sponsor Warburg Pincus," S&P stated. "The ratings on Scotsman primarily reflect the company's aggressive financial risk profile," said Standard & Poor's credit analyst John Sico. "Its weak business risk profile, characterized by a leading market position in a niche industry, partially offsets this factor. We expect Scotsman's revenue to continue to grow in fiscal 2011. We also believe its credit metrics will likely remain within our expectations for the ratings, following the proposed dividend payment. The company's modest cash balances, adequate availability under the revolver, and decent cash flow generation support our view of its adequate liquidity." The outlook is stable. "We expect the company to operate within credit measures commensurate for the ratings over the business cycle. However, we could lower the ratings if a worse-than- expected market downturn and/or debt-financed activities adversely affect liquidity or result in a meaningful deterioration of credit measures, for example, if debt to EBITDA moves higher than 5x. On the other hand, if the long-term competitiveness of Scotsman's business remains healthy, and if its credit measures, liquidity, and financial policies continue to support this, we could raise the ratings," S&P added. SEAGATE TECHNOLOGY: Fitch Affirms Issuer Default Rating at 'BB+' ---------------------------------------------------------------- Fitch Ratings has affirmed these ratings on Seagate Technology plc and its subsidiaries: Seagate -- Issuer Default Rating (IDR) at 'BB+'; -- Secured first lien credit facility at 'BBB-'. Seagate HDD Cayman (Seagate HDD) -- IDR at 'BB+'; -- Secured first lien credit facility at 'BBB-'; -- Senior unsecured debt at 'BB+'. Seagate Technology International (STI) -- IDR at 'BB+'; -- Secured second lien notes at 'BBB-'. Furthermore, Fitch has assigned a 'BB+' rating to Seagate's proposed issuance of $600 million of senior unsecured notes due 2021. The net proceeds will be used for general corporate purposes, which may include capital expenditures and/or the repayment of outstanding debt. The Rating Outlook is Stable. Approximately $3.3 billion of total debt is affected by Fitch's action, including the company's undrawn $350 million secured revolving credit facility but excluding the proposed debt issuance. The ratings and Stable Outlook reflect: -- Fitch's expectations that Seagate's operating margin and cash flow will strengthen in the second half of calendar 2010 due to new cost-effective hard disk drives (HDD) and stable to slightly positive industry supply and demand. -- Seagate's solid liquidity supported by nearly $2.5 billion of cash, generally positive annual free cash flow (FCF), an undrawn $350 million senior secured revolving credit facility due 2015 and staggered debt maturities. -- Broad product portfolio with leading revenue market share in the enterprise and overall HDD industry. -- The company's scale and vertically integrated model, which reduces per-unit manufacturing costs. -- Continued growth of digital rich media by consumers and enterprise storage requirements, which bode favorably for longer term HDD unit demand. Fitch's rating concerns consist of: -- Substantial volatility in earnings and FCF due to cyclical demand and significant fixed costs; -- Consistent declines in average selling prices for HDDs due to intense competition and low switching costs; -- Deteriorating credit metrics due to Seagate's pre-funding of $559 million of notes due October 2011 via a $750 million debt offering in December 2010 and challenging industry conditions, including comparable HDD products across the industry and declining consumer PC demand, both of which have adversely affected profitability. -- Risk of technology substitution from NAND flash and solid state drives (SSD) led by increasing consumer interest in flash-based tablets at the expense of notebooks with HDDs; -- Event risk associated with the adoption of aggressive shareholder friendly activities, primarily debt-financed share repurchases. -- Seagate's ability to sustain a time to market advantage critical to achieving market share gains and maintaining overall profitability, given formidable competition from Western Digital Corp. (WDC). The ratings may be upgraded in the event of: -- If the volatility of Seagate's profit margins and FCF materially decline as a result of proposed industry consolidation. -- If Seagate gains meaningful market share without adversely affecting profitability following WDC's pending acquisition of Hitachi Global Storage Technologies (HGST). -- If Seagate develops a highly differentiated SSD product that provides a sustainable competitive advantage, thereby strengthening long-term revenue growth and profitability. The ratings may be downgraded in the event of: -- If Seagate's SSD products are uncompetitive and the cost per gigabyte differential between HDD and SSD narrows significantly, resulting in greater than expected cannibalization of HDD shipments. -- If Seagate's enterprise market share materially erodes due to more formidable competition from WDC following its acquisition of HGST. -- If the company pursue more aggressive financial policies, such as sizable debt-financed share repurchases. Total liquidity as of April 1, 2011 was nearly $2.9 billion, consisting of $2.5 billion of cash, the vast majority of which is readily accessible without adverse tax considerations, and an undrawn $350 million senior secured first lien credit facility due in 2015. Lastly, positive, but pressured, FCF of $319 million in the latest 12 months (LTM) ended April 1, 2011 also sustains liquidity. Fitch forecasts FCF of $200 million -$225 million in fiscal 2011 ending June 30, 2011. Obligations under the credit agreement are secured by first- priority liens granted by Seagate, Seagate HDD and other direct and indirect material subsidiaries of Seagate located in the U.S., the Cayman Islands, Northern Ireland, Singapore and The Netherlands on substantially all tangible and intangible assets, subject to certain exceptions. Financial covenants in the credit agreement consist of a minimum fixed charge coverage of 1.5 times (x) and a maximum net leverage ratio of 1.5x. In addition, the facility requires minimum liquidity of $500 million. As a result of debt pre-funding and challenging industry conditions, leverage (total debt/operating EBITDA) increased to 1.6x as of April 1, 2011 from 0.8x in the year-ago period. Interest coverage (operating EBITDA/gross interest expense) declined to nearly 10x in the LTM ended April 1, 2011 compared with 15x last year. Fitch anticipates modest deterioration in credit metrics in the next three months given industry challenges until new more cost efficient products are introduced in the second half of calendar 2011. Fitch estimates total debt is approximately $2.9 billon, consisting of: -- $559 million of 6.375% senior notes due October 2011 (Seagate HDD); -- $416 million of 10% senior secured second-priority notes due April 2014 (STI); -- $600 million of 6.8% senior notes due October 2016 (Seagate HDD); -- $750 million of 7.75% senior notes due December 2018 (Seagate HDD); -- $600 million of 6.875% senior notes due May 2020 (Seagate HDD); SEAGATE HDD: S&P Rates $600MM Sr. Unsecured Notes 'BB+' ------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' senior unsecured rating to the $600 million 10-year note being offered by Seagate HDD Cayman. The rating is equal to the corporate credit rating on guarantor and parent Seagate Technology plc. The recovery rating is '3', indicating meaningful (50%-70%) prospects for recovery in the event of a payment default. The new debt issue does not affect the 'BB+' corporate credit rating and stable outlook on Seagate Technology plc. The company intends to use the proceeds for general corporate purposes and to support its recently announced acquisition of Samsung assets and its dividend. "We expect that Seagate will retire the $560 million of debt maturing in 2011, and as a result, overall debt levels are fundamentally unchanged as a result of this transaction. We calculate pro forma adjusted debt to EBITDA at 2x as of March 31, 2011, declining to 1.6x once the $560 million is retired," S&P noted. Ratings List Seagate Technology plc Corporate Credit Rating BB+/Stable/-- New Rating Seagate HDD Cayman Senior Unsecured $600 mil nts due 2021 BB+ Recovery Rating 3 SELECT MEDICAL: Moody's Assigns B1 to Sr. Secured Credit Loan ------------------------------------------------------------- Moody's Investors Service assigned a B1 (LGD 3, 41%) rating to Select Medical Corporation's proposed $1.5 billion senior secured credit facility, consisting of a $300 million revolver expiring 2016 and a $1.2 billion term loan due 2018. Select Medical Corporation is a wholly owned subsidiary of Select Medical Holdings Corporation (collectively Select Medical). Moody's also affirmed the existing ratings of the company, including the B2 Corporate Family and Probability of Default Ratings, and changed the rating outlook to positive from stable. Moody's understands that the proceeds of the new credit facility will be used to refinance the existing debt of Select Medical, with the exception of the senior floating rate notes at the parent holding company level, which will remain outstanding. Therefore, Moody's will withdraw the ratings of the repaid debt at the close of the transaction. Ratings assigned: Select Medical Corporation: -- $300 million senior secured revolver expiring 2016, B1 (LGD 3, 41%) -- $1,200 million senior secured term loan due 2018, B1 (LGD 3, 41%) Ratings affirmed/LGD assessments revised: Select Medical Holdings Corporation: -- $175 million senior floating rate notes due 2015, from Caa1 (LGD 6, 90%) to Caa1(LGD 6, 95%) -- Corporate Family Rating, B2 -- Probability of Default Rating, B2 -- Speculative Grade Liquidity Rating, SGL-2 Ratings unchanged and to be withdrawn at the close of the transaction: Select Medical Corporation: -- $300 million senior secured revolver expiring 2013, Ba2 (LGD 2, 14%) -- $268 million senior secured term loan due 2012, Ba2 (LGD 2, 14%) -- $385 million senior secured term loan due 2014, Ba2 (LGD 2, 14%) -- $660 million 7.625% senior subordinated notes due 2015, B3 (LGD 4, 62%) RATINGS RATIONALE "Select Medical's proposed refinancing significantly improves the company's maturity profile but the considerable debt load remains," said Dean Diaz, a senior credit officer at Moody's. "The repayment of higher cost debt should also provide interest cost savings and add incrementally to the company's available cash flow," continued Diaz. The B2 Corporate Family Rating reflects Moody's expectation that the company will continue to operate with considerable financial leverage. The ratings also reflect risks associated with the reliance on the Medicare program for a significant portion of the revenue in the company's specialty hospital segment. However, the ratings are supported by Moody's expectation that the company will continue to generate strong free cash flow that can be used to repay debt. The rating also reflects Moody's consideration of Select's considerable scale and position as one of the largest long-term acute care hospital (LTACH) and outpatient rehabilitation providers in the US. The positive outlook reflects Moody's expectation that the company can continue to reduce leverage through debt repayment and EBITDA growth, in part due to the expansion of margins at the facilities added in the acquisition of Regency Hospital Company, LLC (Regency). Additionally, while the moratorium on the addition of LTACH beds precludes an expansion of the company's operations in this service line, it provides a period of near term stability from the more onerous cuts to LTACH reimbursement that had been proposed and prevents competitors from expanding as well. The outlook also reflects Moody's expectation that the company will remain disciplined with respect to the use of additional leverage for acquisitions. Moody's could upgrade the rating if it comes to expect the company will maintain leverage below 5.0 times and free cash flow coverage of debt around 5.0%. This could result through either improvement in the operating results of the acquired Regency facilities or the benefits from the inception of the joint venture partnership for rehabilitation services with the Baylor Health Care System. While the considerable reduction in leverage over the last two years and the improvement in the maturity profile of the company mitigates the likelihood of a rating downgrade in the near term, Moody's could downgrade the rating if adverse developments in Medicare reimbursement result in significant margin deterioration and cash flow coverage metrics or if the company were to complete a material debt financed acquisition or shareholder initiative. More specifically, Moody's could downgrade the rating if it comes to expect leverage to rise to 6.0 times. The principal methodology used in rating Select Medical was the Global For-Profit Hospital Industry Methodology, published September 2008. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Headquartered in Mechanicsburg, PA, Select Medical provides long- term acute care hospital services and inpatient acute rehabilitative care through its specialty hospital segment. The company also provides physical, occupational, and speech rehabilitation services through its outpatient rehabilitation segment. For the year ended Dec. 31, 2010, the company recognized net revenues of approximately $2.4 billion. SELECTIVE INVESTMENTS: Case Summary & 10 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Selective Investments III, LLC 817 SE 5th Court Ft. Lauderdale, FL 33301 Bankruptcy Case No.: 11-08643 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Jay B. Verona, Esq. ENGLANDER AND FISCHER, LLP 721 1st Avenue North St. Petersburg, FL 33701 Tel: (727) 898-7210 Fax: (727) 898-7218 E-mail: jverona@eandflaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb11-08643.pdf The petition was signed by Phillip Chinnock, managing member. SENSATA TECHNOLOGIES: S&P Rates $1.45Bln. Credit Facility 'BB+' --------------------------------------------------------------- Standard & Poor's Ratings Services assigned issue-level and recovery ratings to Sensata Technologies B.V.'s proposed $1.45 billion senior secured credit facility (consisting of a $1.2 billion term loan and a $250 million revolver) and proposed $600 million senior unsecured notes. "The issue-level rating for the secured facility is 'BB+' (two notches above the corporate credit rating); the recovery rating is '1', indicating our expectation that lenders would receive very high (90%-100%) recovery of principle in the event of a payment default. The senior notes are rated 'B' (two notches below the corporate credit rating); the recovery rating is '6', indicating our expectation that lenders would receive negligible (0%-10%) recovery of principle in the event of a payment default. Proceeds from the offerings are to be used to refinance the company's capital structure including its existing credit facility, 8% senior notes due 2014, and 9% senior subordinated notes due 2016," S&P stated. The ratings on Sensata reflect the company's aggressive financial risk profile and its satisfactory business risk profile. "In 2011, we expect Sensata's adjusted EBITDA margin to remain very good at about 30%, and for revenue growth to exceed 10% (benefitting from the completion of the Honeywell Automotive On Board business in the first quarter). We believe credit measures may be better than our expectations for the current rating, including funds from operations (FFO) to debt of 15%-20% and debt to EBITDA of about 4x, by year-end. These measures were about 19% and 4x at the end of the first quarter. However, continued majority ownership by Bain Capital remains a risk, since it relates, in our view, to the company's financial policy," S&P noted. According to S&P, "We could lower the ratings if we see signs that the company will pursue a more-aggressive financial policy or if market conditions become unfavorable, resulting in deteriorating credit measures; for instance, if we thought adjusted FFO to debt would decline to less than 15% and near-term improvement was unlikely. We could raise the ratings if we expect improved operating performance to result in FFO to total adjusted debt to be sustained at 20% or more, and we see further indications that Bain Capital is likely to substantially reduce its investment in Sensata." Ratings List Sensata Technologies B.V. Corporate credit rating BB-/Stable New Rating Sensata Technologies B.V. $1.2 term loan BB+ Recovery rating 1 $250 mil revolver BB+ Recovery rating 1 $600 mil sr unsec notes B Recovery rating 6 SENSATA TECHNOLOGIES: To Refinance All Existing Indebtedness ------------------------------------------------------------ Sensata Technologies Holding N.V. announced a series of financing transactions by its wholly-owned subsidiary, Sensata Technologies B.V., designed to refinance substantially all of its existing indebtedness. These transactions include: * A proposed private offering of up to $600 million in aggregate principal amount of new senior notes; * A proposed new senior secured credit facility that will provide Sensata with an up to $1,200 million term loan facility and an up to $250 million revolving credit facility; and * The commencement of cash tender offers and consent solicitations by the Company with respect to all of its outstanding debt securities. The proceeds from the New Credit Facility, the New Senior Notes and cash on hand will be used to (i) repay all of the amounts currently outstanding under the Company's existing term loans, 8% Senior Notes due 2014 and its 9% Senior Subordinated Notes due 2016, (ii) pay all accrued interest on such indebtedness and related redemption premiums, as applicable, up to but not including the Applicable Payment Date and (iii) pay all fees and expenses in connection with these refinancing transactions. The exact terms, amounts and timing of the New Senior Notes and the New Credit Facility will depend upon market conditions and other factors. In connection with the tender offers, the Company is soliciting the consents of the holders of the Notes to proposed amendments to each indenture governing the Notes. The principal purpose of the Consent Solicitations and the Proposed Amendments is (i) to eliminate substantially all of the restrictive covenants, (ii) to eliminate or modify certain events of default and (iii) to eliminate or modify related provisions contained in the indentures governing the Notes. In order for the Proposed Amendments to be effective with respect to an applicable series of Notes, holders of at least a majority of the outstanding aggregate principal amount of such series of Notes must consent to the Proposed Amendments. Holders who tender Notes are obligated to consent to the Proposed Amendments and holders may not deliver consents without tendering the related Notes. Each holder who validly tenders and does not subsequently validly withdraw its Notes and delivers and does not subsequently validly revoke its consent to the Proposed Amendments with respect to such Notes prior to 5:00 p.m., New York City time, on May 11, 2011, unless extended, will receive (i) with respect to the Dollar Notes accepted for purchase by the Company, Total Consideration of $1,022.50 per $1,000 principal amount of such Notes, which includes $992.50 as the Tender Offer Consideration and $30.00 as a Consent Payment, and (ii) with respect to the Euro Notes accepted for purchase by the Company, Total Consideration of EUR1,048.75 per EUR1,000 principal amount of such Notes, which includes EUR1,018.75 as the Tender Offer Consideration and EUR30.00 as a Consent Payment. In addition, accrued interest up to, but not including, the Applicable Payment Date of the Notes will be paid in cash on all validly tendered and accepted Notes. Each of the tender offers is scheduled to expire at 11:59 p.m., New York City time, on May 25, 2011, unless extended. Tendered Notes may be withdrawn and consents may be revoked at any time prior to 5:00 p.m., New York City time, on May 11, 2011, unless extended, but not thereafter. Holders who validly tender their Notes and deliver their consents after the Consent Date will receive only the Tender Offer Consideration applicable to those Notes and will not be entitled to receive a Consent Payment if such Notes are accepted for purchase pursuant to the tender offers. The Company reserves the right, at any time or times following the Consent Date but prior to the Expiration Date, to accept for purchase all of the Dollar or the Euro Notes validly tendered prior to the Early Acceptance Time. If the Company exercises this option, it will pay the Total Consideration for the Dollar Notes or the Euro Notes, as applicable, accepted for purchase at the Early Acceptance Time on a date promptly following the Early Acceptance Time. The Company will also pay on the Early Payment Date accrued and unpaid interest up to, but not including, the Early Payment Date on the Notes accepted for purchase at the Early Acceptance Time. The Company currently expects that the Early Payment Date will be May 12, 2011. Subject to the terms and conditions of the tender offers and consent solicitations, the Company will, following the Expiration Date, accept for purchase all the Dollar Notes or the Euro Notes validly tendered prior to the Expiration Date. The Company will pay the applicable Total Consideration or Tender Offer Consideration, as the case may be, for the Dollar Notes and the Euro Notes accepted for purchase at the Final Acceptance Time on a date promptly following the Final Acceptance Time. The Company will also pay on the Final Payment Date accrued and unpaid interest up to, but not including, the Final Payment Date on the Notes accepted for purchase at the Final Acceptance Time. The Company currently expects that the Final Payment Date will be May 26, 2011. The consummation of each tender offer and consent solicitation is conditioned upon, among other things, (i) the Company's receipt of the proceeds from its offering of New Senior Notes and the completion of its New Credit Facility, (ii) the receipt of the consents of holders of at least a majority of the outstanding aggregate principal amount of the Dollar Notes and the Euro Notes, as applicable, to the Proposed Amendments and (iii) the execution of the respective supplemental indenture giving effect to the Proposed Amendments. If any of the conditions are not satisfied, the Company may terminate the tender offers and consent solicitations and return the tendered Notes. The Company has the right to waive any of the foregoing conditions with respect to any series of Notes and to consummate any or both of the tender offers and consent solicitations. The Company also has the right, in its sole discretion, to terminate the tender offers or the consent solicitations at any time, subject to applicable law. Neither tender offer is conditioned upon or subject to the completion of the other tender offer. None of Sensata's or the Company's board of directors, the dealer managers and solicitation agents or any other person makes any recommendation as to whether holders of Notes should tender their Notes or deliver the related consents, and no one has been authorized to make such a recommendation. Barclays Capital Inc. and Morgan Stanley & Co. Incorporated will act as dealer managers and solicitation agents for the tender offers and consent solicitations. With respect to the Dollar Notes, Global Bondholder Services Corporation is the information agent and depositary for the tender offers and consent solicitations. With respect to the Euro Notes, Lucid Issuer Services Limited is the information agent and tender agent for the tender offers and consent solicitations. Questions regarding the tender offers or consent solicitations may be directed to Barclays Capital Inc. at +1 (800) 438-3242 (U.S. toll-free) or +1 (212) 528-7581 (collect) or Morgan Stanley & Co. Incorporated at +1 (800) 624-1808 (U.S. toll-free) or +1 (212) 761-1057 (collect). Requests for the Offer Documents with respect to the Dollar Notes may be directed to Global Bondholder Services Corporation at +1 (866) 952-2200 (U.S. toll-free) or +1 (212) 430-3774 (banks and brokers only). Requests for the Offer Documents with respect to the Euro Notes should be directed to Lucid Issuer Services Limited at +44 (20) 7704-0880. About Sensata Almelo, Netherlands-based Sensata Technologies B.V. -- http://www.sensata.com/-- Sensata Technologies B.V. is a global designer, manufacturer, and marketer of customized and highly- engineered sensors and control products. Sensata is a wholly- owned subsidiary of Sensata Technologies Holding, N.V. Its sensors segment accounts for approximately 60% of the company's 2009 revenues, and supplies sensors and transducers to the commercial, industrial and automotive markets. Revenue for the LTM period ended 9/30/10 approximated $1.5 billion. The Company's balance sheet at March 31, 2011 showed $3.39 billion in total assets, $2.49 billion in total liabilities, and $895.09 million in total shareholders' equity. * * * In October 2010, Moody's Investors Service said that Sensata Technologies' 'B2' Corporate Family Rating and positive outlook remain unchanged following the announcement of its public holding company, Sensata Technologies Holding N.V., that it has reached a definitive agreement to acquire the "Automotive on Board" sensors business of Honeywell International for $140 million in cash. Moody's last rating action on Sensata was Aug. 26, 2010, when the company's Corporate Family and Probability of Default ratings were upgraded to B2 from B3 and the ratings outlook was changed to positive. As reported by the TCR on March 1, 2011, Standard & Poor's Ratings Services raised the ratings on sensors and controls manufacturer Sensata Technologies B.V., including the corporate credit rating, to 'BB-' from 'B+'. The outlook is stable. "The rating actions reflect further improvements in Sensata's credit measures and the continuing ownership reduction of its majority owner, private equity firm Bain Capital, which S&P believes provides further indication that the company is likely to maintain a less- aggressive financial policy," said Standard & Poor's credit analyst Dan Picciotto. "S&P believes operating trends for 2011 remain favorable and that the company has demonstrated good profitability through the economic downturn and into the upturn." SHEA HOMES: Moody's Assigns 'B2' Corporate Family Rating -------------------------------------------------------- Moody's Investors Service assigned a B2 rating to the proposed new senior secured notes of Shea Homes Limited Partnership and its co- issuer, Shea Homes Funding Corp., proceeds of which will be used to repay existing indebtedness. Moody's also assigned a B2 to Shea's corporate family and probability of default ratings. The rating outlook is stable. This is the first time that Moody's has rated the debt of Shea. These rating actions were taken: -- B2 (LGD4, 51%) assigned to the new $750 million senior secured notes due 2019 -- B2 corporate family rating assigned -- B2 probability of default rating assigned RATINGS RATIONALE The B2 rating considers that cash flow generation, which had been one of the few financial metrics in which the company performed strongly during the homebuilding downturn, is likely to remain weak in 2011 after turning negative in 2010. In addition, the company's unrestricted cash position, pro forma for this transaction, will be one of the smallest among the rated homebuilders. When these factors are considered together with the absence of any planned revolving credit facility that could be used for working capital purposes, the company's overall liquidity position is regarded only as adequate, despite the elimination of maintenance covenants and the pushing out of its nearest debt maturity to 2019 (when the proposed new senior secured notes mature). In addition, the company's debt leverage (after Moody's adjustments for operating leases, contractual off-balance sheet joint venture obligations, and specific-performance lot options) is indicative of a low-B rating as are other key financial metrics, principally interest coverage and return on assets. The company's total lot supply, even though a considerable portion is devoted to resale to other builders, is also the highest of the rated homebuilders, which may make a return to the high margin performance of the past an arduous task. Finally, Shea's multitude of related party transactions, although being reduced, make the complexity of its corporate and capital structures potentially limiting factors for any upgrade consideration. At the same time, the company's B2 rating is supported by the apparent stabilization of the housing market, albeit at extremely low levels, as reflected in the moderating of the company's impairment charges and the narrowing of its operating losses. In addition, Shea possesses a number of inherent strengths not necessarily available to its peers, including its 43-year track record through numerous down cycles, support from a well-regarded 130-year old parent company (as evidenced by capital injections of $120 million in 2007 and $75 million of cash as part of the transaction contemplated hereby), top 10 market position in each of its key markets, and a reasonably strong active-adult brand name (Trilogy). Finally, as a result of the proposed transaction, virtually all of the covenant drama of the past two years will disappear, and the company will have a clean and clear debt maturity schedule until 2019. The stable ratings outlook reflects Moody's belief that the industry's fundamental credit conditions have stabilized although they remain very weak, that Shea's liquidity position has improved such that it should be able to navigate the next several years without a significant need for major new external capital, and that the company will continue to reduce its debt leverage even as it pursues additional growth opportunities during the next few years. The proposed new notes will be secured by a lien on substantially all of the assets owned by Shea (which lien may be junior to other liens granted by Shea, to be set forth in the definitive documentation governing the proposed debt issuance) and will be fully and unconditionally guaranteed by Shea's principal operating subsidiaries. The principal methodology used in rating Shea was the Global Homebuilding Industry Industry Methodology, published March 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Headquartered in Walnut, CA and established in 1968, Shea Homes is one of the largest private homebuilding companies in the U.S. For the year ended Dec. 31, 2010, Shea closed 1,489 homes having an average selling price of approximately $416,000. Total revenues from the sales of homes, land and homebuilding related activities were approximately $640 million while net income was approximately $(60 million). At Dec. 31, 2010, the company was selling homes in 79 communities, with home prices ranging from approximately $113,000 to $1,275,000, and it had a backlog of 406 homes with a sales value of approximately $167.3 million. SHIPPERS' CHOICE: Settlement Talks With CDS Continue ---------------------------------------------------- Shippers' Choice of Virginia, Inc., and Commercial Drivers Services, Inc., remain in settlement discussions over CDS' objection to the Debtor's motion for final decree closing its bankruptcy case and for filing a Chapter 11 Final Report. Bankruptcy Judge Nancy V. Alquist has signed off on a second stipulation extending to May 13 the Debtor's deadline to respond to CDS' objection. A copy of the stipulation, dated May 3, 2011, is available at http://is.gd/R0RFkSfrom Leagle.com. Shippers' Choice of Virginia, Inc., filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 04-17933) in 2004. Shippers' Choice is represented by: Alan M. Grochal, Esq. TYDINGS & ROSENBERG LLP 100 East Pratt Street Baltimore, MD 21202-1062 Tel: (410) 752-9700 E-mail: agrochal@tydingslaw.com Attorneys for Commercial Driver Services, Inc., is represented by: Gary H. Leibowitz, Esq. Cole Schotz Meisel Forman & Leonard, P.A. 300 East Lombard Street #2000 Baltimore, MD 21202 Tel: (410) 230-0660 E-mail: gleibowitz@coleschotz.com SIRIUS XM: Reports $78.12 Million Net Income in March 31 Qtr. ------------------------------------------------------------- Sirius XM Radio Inc. filed with the U.S. Securities and Exchange Commission a Form 10-Q reporting net income $78.12 million on $723.84 million of total revenue for the three months ended March 31, 2011, compared with net income of $41.59 million on $663.78 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $7.22 billion in total assets, $6.93 billion in total liabilities and $298.62 million total stockholders' equity. "We ended the first quarter with $434 million of cash and cash equivalents after deploying approximately $135 million to repurchase debt. In April, we repurchased approximately $74 million of our 3.25% Convertible Notes due 2011 via a cash tender offer," said David Frear, SiriusXM's Executive Vice President and Chief Financial Officer. "We continue to make progress toward reaching our leverage target. Our net debt to adjusted EBITDA declined to 4.1x at the end of the first quarter of 2011 from 6.6x at the end of the first quarter of 2010." A full-text copy of the Form 10-Q is available for free at: http://is.gd/FVVVyO About Sirius XM Radio Based in New York, Sirius XM Radio Inc. has two principal wholly owned subsidiaries, XM Satellite Radio Holdings Inc. and Satellite CD Radio Inc. XM Satellite Radio Holdings Inc. owns XM Satellite Radio Inc., the operating company for the XM satellite radio service. Satellite CD Radio Inc. owns the Federal Communications Commission license associated with the SIRIUS satellite radio service. XM Satellite Radio Inc. owns XM Radio Inc., the holder of the FCC license associated with the XM satellite radio service. In July 2008, the Company's wholly owned subsidiary, Vernon Merger Corporation, merged with and into XM Satellite Radio Holdings Inc. and, as a result, XM Satellite Radio Holdings Inc. became Sirius' wholly owned subsidiary. * * * Sirius carries (i) a 'BB-' corporate credit rating from Standard & Poor's and (ii) 'B3' corporate family rating and 'B2' probability of default rating from Moody's. In October 2010, Moody's said the upgrade of Sirius XM's CFR to 'B3' from 'Caa1' reflects Moody's view that EBITDA (incorporating Moody's standard adjustments) less capital spending to interest expense will grow and comfortably exceed 1x in 2011, reflecting higher than anticipated subscribers and revenue and reduced debt service and programming costs. As announced on October 1, 2010, the company expects to add more than 1.3 million subscribers in FY2010, bringing the year end total to 20.1 million and exceeding prior expectations. Despite high churn in the subscriber base, vulnerability to cyclical consumer spending, and increasing wireless competition, Moody's believe subscriptions will grow through the end of 2011 as the economy and automotive sales recover. Heightened capital spending related to the ongoing construction and launch of two satellites will likely limit free cash flow generation in 2011. The rating also reflects the company's sizable debt burden as well as the need to invest significantly in programming, marketing, launching new services, and maintaining a satellite fleet to attract subscribers in addition to delivering content. As reported by the Troubled Company reporter on Dec. 14, 2010, Standard & Poor's Ratings Services raised its corporate credit rating on Sirius XM Radio and its subsidiaries, XM Satellite Radio Holdings Inc. and XM Satellite Radio Inc. (which S&P analyze on a consolidated basis), to 'BB-' from 'B+'. The rating outlook is stable. "The action reflects the company's improving operating performance, declining debt leverage, and the prospects for continued improvement in credit measures for full-year 2010 and 2011," explained Standard & Poor's credit analyst Hal Diamond. SKYE INTERNATIONAL: Files Chapter 7 Petition -------------------------------------------- BankruptcyData.com reports that SKYE International filed for Chapter 7 protection (Bankr. D. Nev. Case No. 11-51433). The Company is represented by Chris D. Nichols of Belding, Harris & Petroni. SKYE International emerged from a previous Chapter 11 filing in October 2010. SKYE had filed for Chapter 11 protection (Bankr. D. Nev. Case No. 09-54485) on Dec. 16, 2009, estimating assets and debts of $1 million to $10 million. Scottsdale, Ariz.-based SKYE International, Inc. is in the business of designing, developing, and marketing consumer water heating appliances. All of the Company's products are designed by in-house engineering and contract engineers from third party engineering firms. SPENCER SPIRIT: S&P Rates Corp. Credit & Sr. Unsecured Notes 'B' ---------------------------------------------------------------- After receiving final documents, Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Egg Harbor Township, N.J.-based specialty retailer Spencer Spirit Holdings Inc. The rating outlook is stable. "At the same time, we assigned a 'B' issue-level rating to the company's $175 million senior secured notes with a recovery rating of '4', indicating our expectation of average recovery (albeit at the low end of the 30% to 50% range) in the event of a payment default. These notes were sold under Rule 144A without registration rights. The company used the proceeds to refinance existing debt and pay a cash distribution to its shareholders," S&P said. "The ratings incorporate our expectation that benefits from store remodeling and expansion initiatives will likely contribute to modest improvement in credit measures," said Standard & Poor's credit analyst Andy Sookram, "but we expect them to remain in line with the 'B' ratings." The ratings also reflect the combination of the company's vulnerable business risk profile and highly leveraged financial risk profile based on its exposure to cyclical and highly competitive specialty retailing markets, an increase in debt, and thin free cash flow generation," S&P stated. SPRING WINDOW: Moody's Rates $35MM 1st Lien Credit Facility 'B1' ---------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Springs Windows Fashion's $350 million 1st lien senior secured credit facility ($300 million term loan and $50 million revolver) and a Caa1 rating to the $125 million 2nd lien term loan. At the same time, the B2 Corporate Family Rating was affirmed and the Probability of Default Rating was upgraded to B2 from B3. The outlook was revised to stable from positive. The ratings on the existing secured credit facility will be withdrawn upon closing. Proceeds from the two credit facilities will be used to repay the existing term loan (roughly $247 million) and pay a $186 million dividend. "While this transaction is somewhat aggressive from a credit perspective and temporarily weakens Springs' credit metrics, Moody's believes that Springs has showed enough resiliency in its business and effectiveness of controlling costs to not warrant a downgrade," said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. For example, this transaction will increase adjusted debt/Ebitda by more than two turns to over 6 times from 4 times at Dec. 31, 2010. "However, Moody's believes this ratio should approach 5.5 times by the end of 2011," noted Cassidy. The Probability of Default Rating upgrade to B2 from B3 is a result of the change to a first lien-second lien structure. Because of this change, Moody's is utilizing a 50 percent mean family recovery rate in accordance with the LGD methodology -- which resulted in the upgrade. RATING RATIONALE The B2 Corporate Family Rating reflects Springs' small size with revenue around $500 million, high customer concentration and sensitivity to the housing market and discretionary consumer spending. It also recognizes that while credit metrics will become weak following a pending dividend, they should steadily improve over the next few years to more reasonable levels. The Corporate Family Rating also reflects the ongoing operating performance enhancements, in spite of choppy consumer confidence and uncertain discretionary consumer spending for mid-tier consumers. The ratings also reflect Moody's view that the company will maintain its strong market share in the retail custom window coverings niche going forward, as well as the value of its two largest brands, Bali and Graber, and long-term relationships with key customers. The stable outlook reflects Moody's view that credit metrics should be temporarily weak, but steadily improve. Springs history of controlling costs and Moody's expectation that this practice will continue is also reflected in the stable outlook. There is no upside rating pressure in the near term given the deterioration in credit metrics which will accompany Springs' planned dividend. And because of Springs' relatively small scale with revenue around $500 million and history of aggressive financial policies, Springs' credit metrics need to be stronger than similarly rated consumer durables companies for an upgrade over the longer term. For example, for an upgrade to be considered, debt/EBITDA would need to approach 3 times and interest coverage needs to be moving toward 4 times. There is also limited downside rating pressure in the near term, despite the somewhat aggressive recapitalization. This is because Springs has proven to be able to generate good earnings and cash flow in a very difficult economic environment. Over the longer term, ratings could be downgraded if credit metrics significantly deteriorate. For example, Moody's could downgrade the ratings if debt/EBITDA approaches 7 times (currently over 6 times proforma for the transaction) or EBITA margins fall to the single digits (currently in the mid teens). Another aggressive debt funded shareholder return in the near term could also spark a downgrade. The B1 rating on the1st lien senior secured credit facility and the Caa1 rating on the 2nd lien credit facility reflect a B2 probability-of-default rating and an LGD 3 for the 1st lien and an LGD 5 for the 2nd lien. The 1st lien facilities are rated one notch higher than the B2 Corporate Family Rating reflecting their priority position in relation to collateral. The Caa1 rating on the second lien term loan is two notches lower than the CFR reflecting the weaker collateral position that facility holds. The ratings of both the 1st lien and 2nd lien reflects the upstream guarantees from operating subsidiaries and the all asset pledge on a first and second lien basis. Moody's assigned these ratings: -- $300 Million First Lien Term Loan at B1 (LGD 3, 36%); -- $50 Million First Lien Revolver at B1 (LGD 3, 36%); -- $125 Million Second Lien Term Loan Caa1 (LGD 5, 86%); Moody's upgraded these rating: -- Probability of Default Rating to B2 from B3; -- Moody's affirmed these rating: -- Corporate Family Rating at B2 For additional information, please refer to Moody's Credit Opinion of Springs Windows Fashions published on Moodys.com. The principal methodology used in rating Springs was the Global Consumer Durables rating methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Springs Window Fashions, LLC, headquartered in Middleton, Wisconsin, is a leading manufacturer and designer of window coverings under the brand names of Bali, Graber and Nanik. Product lines include hard and soft window blinds, roller shades, drapery hardware, shutters, solar shades, and window accessory products. The company is privately held and generated revenues of $498 million in the twelve months ended Jan. 1, 2011. STAFFORD COUNTY: Moody's Affirms GO Bond Rating at 'Ba2' -------------------------------------------------------- Moody's Investors Service has affirmed Strafford County's (NH) Ba2 general obligation bond rating, affecting approximately $21.5 million in outstanding parity debt. The outlook remains negative. The bonds are secured by a general obligation unlimited tax pledge. RATINGS RATIONALE The Ba2 rating reflects the county's weak financial position, lack of liquidity, and heavy reliance on cash flow borrowing. The negative outlook reflects the possibility of further credit deterioration should the county become challenged to maintain market access for cash flow needs, particularly given its still minimal liquidity position. STRENGTHS -- Stable tax base with low unemployment -- Low long-term debt levels -- Stable property tax revenue collections CHALLENGES -- High reliance on tax and revenue anticipation note borrowing to fund operations and debt service -- Loss of federal stimulus funds, which has helped augment fund balance -- Ability to make sufficient budget adjustments to continue to improve the county's General Fund and Nursing Home's financial position, particularly given the uncertainty of long-term nursing home expenditure pressures DETAILED CREDIT DISCUSSION POSITIVE FISCAL 2010 RESULTS; COUNTY REMAINS HEAVILY RELIANT ON MARKET ACCESS FOR CASH FLOW NEEDS Fiscal 2010 results exhibited improvement in the county's financial position. General Fund operations ended positively by $2.4 million, reducing the accumulated unreserved General Fund deficit to a negative $7.1 million (-18.5% of revenues) from a negative $9.2 million (-25.5% of revenues) in 2009. The $7.1 million accumulated deficit represents the amount still due to the General Fund from the nursing home, which had consecutive operating deficits over a multi-year period resulting in a relatively substantial inter-fund receivable. Positively, the county has reduced its accumulated General Fund deficit by 32% since 2008, through a combination tight expenditure controls, more conservative revenue estimates and unbudgeted federal stimulus funds. The nursing home ended fiscal 2010 with a net asset position of $0, following a subsidy from the General Fund of $5.6 million. The fiscal 2011 budget (ending Dec. 31) has yet to be adopted; the late adoption of annual budgets has been a trend for the county for many years. The proposed budget, which included a tax rate increase, was narrowly defeated. In response, county management has had to make approximately $750,000 of budget reductions consisting of program eliminations, position reductions, and reduced appropriations to outside agencies. If current trends continue, the county expects to produce positive operating results for the current fiscal year, supported by conservative revenue estimates as well as unbudgeted savings from an increase in the state's Medicaid reimbursement rate and the last installment of federal stimulus funds, which the county has left unbudgeted. Due to a constrained cash position, and the timing of property tax receipts (one payment on December 17th), the county continues to rely heavily on the use of tax anticipation notes (TANs) and revenue anticipation notes (RANs) to fund operations. The county regularly issues TANs equal to the entire amount of the property tax levy, through two issuances in February and April or May. Importantly, the county's levy is made whole by its member municipalities with no history of missed payments. The county also regularly issues RANs in August which are generally paid off with federal and state Medicaid reimbursements in early February, crossing fiscal years. In support of fiscal 2010 operations, the county issued a $20 million TAN in February 2010 (due 12/30) and a $6.7 million TAN in May 2010 (due 12/30), following the adoption of the county's budget in March. Further, the county issued a $9.78 million RAN in August, payable February 5, 2011. At one time, the county had $36.7 million of tax and revenue anticipation notes outstanding in fiscal 2010, equal to 136% of its 2010 levy. The county's largest debt service payments are due in January and July, making continued access to the capital markets critical to fund core county operations and pay debt service, particularly in light of the timing of the county's coupon payments at a cash low point in the beginning on January and their overwhelming reliance on the market for liquidity. For fiscal 2011, the county issued a $20 million TAN in January and anticipates an additional TAN of $7 million once the budget is adopted. The county hopes to reduce is August RAN borrowing to $7.5 million. The county's debt portfolio consists entirely of fixed rate borrowing and the county has not entered into any derivative agreements. Outlook The negative outlook reflects the possibility of further credit deterioration should the county become challenged to maintain market access for cash flow needs, particularly given its still minimal liquidity position. The outlook also reflects Moody's the possibility additional downward rating movement should the county's financial position weaken further. What could move the rating UP (remove the negative outlook): -- Sustained record of structurally balanced operations and improved liquidity levels -- Improvement of General Fund reserves and the reduction of the county illiquid receivable due from the nursing home. What could move the rating DOWN: -- Structurally imbalanced operations -- Increased level of cash-flow borrowing -- Failure to execute deficit reduction plan KEY STATISTICS 2007 Population: 121,581 2009 Full valuation: $10.5 billion Full value per capita: $86,652 1999 PCI (as % of NH and US): $20,479 (16% and 95%) 1999 MFI (as % of NH and US): $53,075 (92% and 106%) Debt burden: 0.2% Payout of principal (10 years): 78% 2010 Unreserved General Fund balance: -$7.1 million (-18.5% of revenues) G.O. debt outstanding: $21.5 million The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. STILLWATER MINING: Reports $36.19MM Net Income in March 31 Qtr. --------------------------------------------------------------- Stillwater Mining Company reported net income of $36.19 million on $170.06 million of total revenues for the three months ended March 31, 2011, compared with net income of $13.35 million on $133.47 million of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $974.54 million in total assets, $344.74 million in total liabilities and $629.80 million in total stockholders' equity. Reviewing the Company's performance, Francis R. McAllister, Stillwater's Chairman and CEO, commented, "Overall, I am pleased with our performance during first quarter. Palladium prices did trend down during the first quarter, likely as a result of the uncertainty surrounding the effect of rising oil prices and the Japanese earthquake and tsunami damage to the outlook for automobile production. However, I believe these factors will have a relatively short term impact on PGM demand and we will continue to experience the benefits of robust PGM, and specifically palladium, market dynamics over the intermediate to longer term. A full-text copy of the press release announcing the financial results is available for free at http://is.gd/jN3MQo About Stillwater Mining Billings, Montana-based Stillwater Mining Company -- http://www.stillwatermining.com/-- is the only U.S. producer of palladium and platinum and is the largest primary producer of platinum group metals outside of South Africa and Russia. The Company's shares are traded on the New York Stock Exchange under the symbol "SWC." Stillwater carries 'Caa1' corporate family and probability of default ratings, with 'stable' outlook, from Moody's Investors Service. It has 'B' issuer credit ratings from Standard & Poor's. SUMMIT BUSINESS: Court Approves Reorganization Plan --------------------------------------------------- Summit Business Media received confirmation of its "pre-arranged" plan of reorganization from the United States Bankruptcy Court for the District of Delaware. The Court's approval allows Summit to implement its capital restructuring, originally announced on Jan. 25 when it filed for bankruptcy, to eliminate more than $140 million of long-term debt from its balance sheet. Summit expects that it will consummate the plan and emerge from bankruptcy in approximately two weeks. "Summit emerges from this restructuring process in much stronger financial shape," said Andrew Goodenough, Summit's President & CEO. "Going forward, the implementation of the restructuring plan will allow Summit to continue to grow our valuable franchises across the insurance, financial and professional services markets." During the bankruptcy, Summit continued to improve operations, and made several product launches and enhancements, including the official launch of BenefitsPro.com, the most comprehensive source of news and opinion to help benefits brokers, HR managers and retirement advisors. As a result, the Company is positioned for growth, not only because of a strengthened capital structure, but also because of its expanded portfolio of value-added customer solutions. "While the challenges of this process were real, emerging in under four months without so much as a contested hearing is a testament to the hard work put in over the last few years by our management team, our advisors and our lenders," Goodenough said. "I would also like to thank our customers and vendors for their understanding and continued support during this uncertain period. Finally, I want to personally thank our 400 employees for their dedication and hard work during this process." About Summit Business Media 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. 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 filed on Feb. 1, 2011, their Chapter 11 Plan of Reorganization. The plan was worked out in advance with holders of 83% or more of the first-and second-lien debt. Pursuant to the Plan terms, holders of allowed priority tax claims, which are unimpaired and unclassified under the Plan, will be paid over a period not later than 5 years after the Petition Date. Holders of prepetition first lien secured claims owed $189 million will receive a new $110 million first-priority first lien term loan, 89.4% of the new stock. The first-lien lenders will recover 68 cents on the dollar. Holders of $55 million in prepetition second lien debt will receive $1 million in cash and 5.56% of the new stock. They will have a 4% recovery. Holders of allowed general unsecured claims expected to total $6 million will receive $100,000 cash, resulting in a 2% recovery. Holders of equity interests in Summit will not receive anything and their interests will be cancelled. Equity Interests in the other debtor-affiliates will be reinstated. Summit Business set a May 5 hearing for approval of the Chapter 11 plan. The bankruptcy judge approved the explanatory disclosure statement on March 28. SW BOSTON: Court Won't Allow Rival Plan At This Time ---------------------------------------------------- Bankruptcy Judge Joan N. Feeney rejected Prudential Insurance Company of America's bid to file a competing plan for SW Boston Hotel Venture LLC at this time. Judge Feeney said Prudential's ability to seek different treatment for its claim other than that proposed by the Debtors in their Joint Plan of Reorganization, is preserved by Prudential's opportunity to reject and object to the Debtors' Plan and to present evidence at a contested confirmation hearing that the Debtors' Plan does not satisfy the requirements of 11 U.S.C. Sections 1129(a) and (b). Judge Feeney noted that counsel to Prudential said at a May 2, 2011 hearing that no other party in interest has expressed support for its proposal to file a competing plan. The Debtors' Plan hinges on a sale of their hotel and garage assets to Razorbacks Owner LLC for $89.5 million this month, and distribute the sale proceeds to Prudential to reduce its secured claim within the next two months. In the event the sale is not consummated, the Debtors propose in their Plan to pay Prudential its allowed secured claim, with interest as determined by the Court. Under either scenario, the Debtors intends to pay the claims of all non-insider unsecured creditors in full with interest. Judge Feeney noted that the Debtors have made progress in negotiations with its creditors. The city of Boston, the holder of a second mortgage, and the Official Committee of Unsecured Creditors support the Debtors' Plan; Starwood Hotels states that it will negotiate in good faith with the Debtors on issues relating to the sale of the Hotel. It appears that the Debtors' Plan is supported by all interested parties, with the exception of Prudential. "Prudential's plan appears to be based, not only on the desire to obtain its contract rate of interest, but also on litigation to obtain recharacterization and, or subordination of debt owed to the Debtors' insiders, a goal which is not shared by any other interested party, and which may be both extremely costly and unsuccessful," Judge Feeney said. "Allowance of a competing plan at this time, particularly one without the support of creditor constituencies and one based upon speculative, time consuming and expensive litigation, is likely to jeopardize the progress in the case to date." Meanwhile, Judge Feeney granted SW Boston a shorter extension of its deadline to solicit acceptances of its bankruptcy plan. Prudential objected to the extension. The Debtors asked the Court to extend their exclusive solicitation period through the date that is 15 days after entry of the Court's decision on confirmation of the Debtors' plan. The current deadline is May 31, 2011. Judge Feeney, however, held that the Debtors' Motion to Extend to a date after any decision by the Court on whether to confirm the Debtors' Plan is unwarranted. Instead, the Court extends the exclusive period for soliciting votes to two days prior to the date scheduled for the hearing on confirmation of the Debtors' Plan, subject to further Court order. A copy of Judge Feeney's May 4, 2011 Memorandum is available at http://is.gd/bsvH9kfrom Leagle.com. About SW Boston Hotel Boston, Massachusetts-based SW Boston Hotel Venture LLC is the developer of the W Hotel in Boston. The Company filed for Chapter 11 bankruptcy protection on April 28, 2010 (Bankr. D. Mass. Case No. 10-14535). Harold B. Murphy, Esq., and Natalie B. Sawyer, Esq., at Hanify & King, P.C., is the Debtors' bankruptcy counsel. Edwards Angell Palmer & Dodge LLP is the Company's special counsel. The Company estimated its assets and debts at $100 million to $500 million. T3 MOTION: Files Form 8-A; Registers Common Stock with SEC ---------------------------------------------------------- T3 Motion, Inc., filed a Form 8-A relating to the registration with the Securities and Exchange Commission of shares of common stock, par value $0.001 per share. As of Dec. 31, 2010, the Company had authorized (i) 150,000,000 shares of common stock, of which 50,658,462 shares were outstanding, and (ii) 20,000,000 shares of preferred stock, par value $0.001 per share, of which 11,502,563 shares were outstanding. The holders of common stock are entitled to one vote per share on all matters to be voted upon by the stockholders. The holders of common stock are entitled to receive any dividends that may be declared from time to time by the Board of Directors out of funds legally available for that purpose. The declaration of any future cash dividend will be at the discretion of the Company's Board of Directors and will depend upon the Company's earnings, if any, capital requirements and financial position, general economic conditions, and other pertinent conditions. In the event of the Company's liquidation, dissolution or winding up, the holders of common stock are entitled to share in all assets remaining after payment of liabilities. The holders of common stock do not have cumulative voting rights, which mean that the holders of more than fifty percent of the shares of common stock voting for election of directors may elect all the directors if they choose to do so. In this event, the holders of the remaining shares aggregating less than fifty percent will not be able to elect directors. The common stock has no preemptive or conversion rights or other subscription rights. About T3 Motion Costa Mesa, Calif.-based T3 Motion, Inc., develops and manufactures T3 Series vehicles, which are electric three-wheel stand-up vehicles that are directly targeted to the public safety and private security markets. The Company reported a net loss of $8.32 million on $4.68 million of net revenues for the year ended Dec. 31, 2010, compared with a net loss of $6.70 million on $4.64 million of net revenues during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $3.58 million in total assets, $19.25 million in total liabilities, and a $15.67 million stockholders' deficit. As reported by the TCR on April 6, 2011, KMJ Corbin & Company LLP, in Costa Mesa, Calif., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant operating losses and has used substantial amounts of working capital in its operations since inception, and at Dec. 31, 2010, has a working capital deficit of $15,057,791 and an accumulated deficit of $45,120,210. TARGUS GROUP: S&P Rates Corp. Credit 'B'; Outlook is Stable ----------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Anaheim, Calif.-based Targus Group International Inc. (Targus). The outlook is stable. "At the same time, we assigned a 'B' rating to the company's proposed $185 million senior secured term loan due 2016. We also assigned a '4' recovery rating to the term loan, indicating our expectation that lenders will receive average (30% to 50%) recovery in the event of a payment default," S&P stated. The company will use the proceeds from the proposed secured term loan offering to repay existing debt, including borrowings under its existing first-lien term loan and revolving credit facility ($172.8 million and $17.3 million outstanding as of April 2, 2011). The company also announced that it will refinance its current revolving credit facility ($40 million) with a new five- year, $60 million asset based revolving credit facility (unrated). About $200 million of total debt will be outstanding at Targus following the close of this transaction. "The ratings on Targus reflect our view of its highly leveraged financial profile and vulnerable business profile," said Standard & Poor's credit analyst Linda Phelps. "We believe the company's profitability is exposed to volatility because of its narrow product focus, relatively small size, and heavy reliance on corporate information technology and consumer spending on notebook computers. However, we believe the company benefits from top market positions within the notebook computer carrying case category and favorable expectations for long term growth of notebook computer and mobile electronic device sales globally." "Our rating outlook on Targus is stable. We expect the company's operating performance to remain relatively stable and that credit measures will remain close to current levels over the next year," said Ms. Phelps. TASC INC: Moody's Assigns Ba2 Rating to New $675MM Bank Facility ---------------------------------------------------------------- Moody's Investors Service has affirmed the B1 Corporate Family and Probability of Default ratings of TASC, Inc, and assigned a Ba2 rating to the company's planned $675 million first lien bank facility which will replace the company's existing bank facility -- a transaction largely neutral to the company's cash and debt balances. Moody's had originally assigned ratings to a proposed new bank financing for TASC on March 14, 2011, but the transaction did not move forward due to market conditions. The transaction has been relaunched under substantially the same terms as the original transaction. Ratings assigned: -- Ba2, LGD2(27%) to $100 million first lien revolver due 2014 -- Ba2, LGD2(27%) to $575 million first lien term loan B due 2015 Ratings affirmed: -- Corporate Family Rating, B1 -- Probability of Default Rating, B1 The Ba2 rating assigned to the company's existing Bank Credit facilities is affirmed and will be withdrawn upon closing of the new facility. RATINGS RATIONALE The ratings consider TASC's strong position as a SETA (systems engineering and technical assistance)-focused U.S. Department of Defense/intelligence community contractor. Yet the rating outlook is negative in consideration of operating performance that has trailed original expectations. Moody's expects U.S. government outlays in TASC's areas of expertise to grow over the intermediate-term, and the company's bid pipeline should benefit. As part of its former owner, TASC faced organizational conflicts of interest that precluded its pursuit of many U.S. defense and intelligence service contracts. While recent operating results have fallen below expectations, continued strong contract win rates on a broadened bid pipeline could improve financial metrics to levels that better support the B1 rating. The principal methodology used in rating TASC, Inc. was the Global Aerospace and Defense Industry Methodology, published June 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. TASC, Inc. provides advanced systems engineering and technical assistance services to U.S. Government intelligence agencies, Department of Defense and various civil agencies. Estimated 2010 revenues were $1.5 billion. REGULATORY DISCLOSURES Information sources used to prepare the credit rating are the following: parties involved in the ratings, parties not involved in the ratings, public information and confidential and proprietary Moody's Investors Service information. Moody's Investors Service considers the quality of information available on the issuer or obligation satisfactory for the purposes of maintaining a credit rating. Moody's adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources. However, Moody's is not an auditor and cannot in every instance independently verify or validate information received in the rating process. The date on which some Credit Ratings were first released goes back to a time before Moody's Investors Service's Credit Ratings were fully digitized and accurate data may not be available. Consequently, Moody's Investors Service provides a date that it believes is the most reliable and accurate based on the information that is available to it. TELIGENT INC: 2nd Circ. Clears K&L to Fight Teligent Deal --------------------------------------------------------- Ian Thoms at Bankruptcy Law360 reports that the Second Circuit on Thursday cleared K&L Gates LLP to challenge the validity of a $6 million settlement struck between the unsecured claim representative for Teligent Inc. and the telecom's former chief executive. Savage & Associates PC, the unsecured claims representative, had hoped to block K&L Gates from seeking to dismantle the deal it reached with former Teligent CEO Alex Mandl, which resolved a dispute over a $12 million loan he received pursuant to his employment contract, according to Law360. Teligent, Inc., a provider of broadband communication services offering business customers local, long distance, high-speed data and dedicated Internet services over its digital SmartWave local networks in major markets throughout the United States, filed for chapter 11 protection on May 21, 2001. James H.M. Sprayregen, Esq., Matthew N. Kleiman, Esq., and Lena Mandel, Esq., at Kirkland & Ellis represented the Debtors in their restructuring effort. When the Company filed for protection from its creditors, it disclosed $1,209,476,000 in assets and $1,649,403,000 debts. The Debtors' Third Amended Plan of Reorganization was confirmed on Sept. 6, 2002. Pursuant to the confirmed Plan, Savage & Associates, P.C., serves as the Unsecured Claims Estate Representative to pursue preference litigation and other post-confirmation recovery actions. TENET HEALTHCARE: CHS Hikes Offer for Shares to $7.25 Apiece ------------------------------------------------------------ Tenet Healthcare Corporation confirmed that it has received a revised proposal from Community Health Systems, Inc., to acquire all of the outstanding shares of Tenet for $7.25 per share in cash. Consistent with its fiduciary duties and in consultation with its independent financial and legal advisors, Tenet's Board of Directors will review the revised proposal to determine the course of action that it believes is in the best interests of the Company and its shareholders. Tenet's shareholders are advised to take no action at this time pending the review of the revised proposal by the Tenet Board of Directors. The Company noted that on Nov. 12, 2010, Tenet received a proposal from Community Health to acquire Tenet for $6.00 per share in cash and stock. On April 18, 2011, Tenet received a proposal from Community Health to acquire Tenet for $6.00 per share in cash. In each instance, the Tenet Board of Directors, after consultation with its financial and legal advisors, unanimously determined that the Community Health proposals grossly undervalued Tenet and failed to reflect Tenet's prospects for continued growth and shareholder value creation and were not in the best interests of Tenet or its shareholders. Barclays Capital is acting as financial advisor to Tenet and Gibson, Dunn & Crutcher LLP and Debevoise & Plimpton LLP are acting as Tenet's legal counsel. About Tenet Healthcare Dallas, Texas-based Tenet Healthcare Corporation (NYSE: THC) -- http://www.tenethealth.com/-- is a health care services company whose subsidiaries and affiliates own and operate acute care hospitals, ambulatory surgery centers and diagnostic imaging centers. The Company's balance sheet at Dec. 31, 2010, showed $8.50 billion in total assets, $6.68 billion in total liabilities, and $1.82 billion in total equity. * * * As reported by the TCR on Aug. 5, 2010, Moody's Investors Service affirmed its 'B2' corporate family rating for Tenet. The rating reflects Moody's expectation that the Company will likely see positive free cash flow for the full year ending Dec. 31, 2010, as operating results continue to improve and litigation settlement payments end in the third quarter. However, the ratings also consider the significant headwinds facing the company, and the sector as a whole, with respect to increasing bad debt expense, weak volume trends and changes in mix as commercial volumes decline. S&P's corporate credit rating on Tenet is 'B' and remains unchanged. The ratings agency noted that while the Company has experience recent successes to date of a multiyear turnaround effort, the Company has a still-weak business risk profile and high financial leverage. Fitch Ratings has issued its Recovery Rating review of the U.S. Healthcare sector. This review includes an analysis of valuation multiples, EBITDA discounts applied, and detailed recovery worksheets for issuers with a Fitch Issuer Default Rating of 'B+' or lower in this sector. Fitch Ratings has placed Tenet Healthcare Corp.'s ratings on Rating Watch Positive. Tenet's existing ratings are Issuer Default Rating 'B-'; Secured bank facility 'BB-/RR1'; Senior secured notes 'BB-/RR1'; Senior unsecured notes 'B/RR3. The ratings apply to approximately $4.3 billion of debt outstanding as of Sept. 30, 2010. TENET HEALTHCARE: Reports $82-Mil. Net Income in March 31 Qtr. -------------------------------------------------------------- Tenet Healthcare Corporation filed with the U.S. Securities and Exchange Commission a Form 10-Q reporting net income of $82 million on $2.50 billion of net operating revenues for the three months ended March 31, 2011, compared with net income of $95 million on $2.34 billion of net operating revenues for the same period during the prior year. The Company's balance sheet at $8.52 million in total assets, $6.61 billion in total liabilities and $1.91 billion in total equity. "Our strong first quarter results reflect solid performance in virtually every aspect of our business," said Trevor Fetter, president and chief executive officer. "Volume growth was a clear highlight in the quarter. Growth in both paying admissions and total admissions turned positive in the quarter. This is the second consecutive quarter in which we have improved the trend in year-over-year changes in patient volumes. We were also very pleased with the robust performance in outpatient volumes with outpatient visits growing by 6.1 percent. Surgeries grew by 0.9 percent. Other factors contributing to the strong quarter included managed care pricing growth and improved performance on bad debt expense, which declined to 7.3 percent of revenues. Earnings growth from these factors was further enhanced by provider fees and government healthcare information technology incentives recorded in the quarter. Reflecting this strong start to the year, we are raising our 2011 Outlook for Adjusted EBITDA by $25 million, to a new range of $1.175 billion to $1.275 billion." A full-text copy of the Form 10-Q is available for free at: http://is.gd/5HIe9R About Tenet Healthcare Dallas, Texas-based Tenet Healthcare Corporation (NYSE: THC) -- http://www.tenethealth.com/-- is a health care services company whose subsidiaries and affiliates own and operate acute care hospitals, ambulatory surgery centers and diagnostic imaging centers. * * * As reported by the TCR on Aug. 5, 2010, Moody's Investors Service affirmed its 'B2' corporate family rating for Tenet. The rating reflects Moody's expectation that the Company will likely see positive free cash flow for the full year ending Dec. 31, 2010, as operating results continue to improve and litigation settlement payments end in the third quarter. However, the ratings also consider the significant headwinds facing the company, and the sector as a whole, with respect to increasing bad debt expense, weak volume trends and changes in mix as commercial volumes decline. S&P's corporate credit rating on Tenet is 'B' and remains unchanged. The ratings agency noted that while the Company has experience recent successes to date of a multiyear turnaround effort, the Company has a still-weak business risk profile and high financial leverage. Fitch Ratings has issued its Recovery Rating review of the U.S. Healthcare sector. This review includes an analysis of valuation multiples, EBITDA discounts applied, and detailed recovery worksheets for issuers with a Fitch Issuer Default Rating of 'B+' or lower in this sector. Fitch Ratings has placed Tenet Healthcare Corp.'s ratings on Rating Watch Positive. Tenet's existing ratings are Issuer Default Rating 'B-'; Secured bank facility 'BB-/RR1'; Senior secured notes 'BB-/RR1'; Senior unsecured notes 'B/RR3. The ratings apply to approximately $4.3 billion of debt outstanding as of Sept. 30, 2010. TERRA-GEN FINANCE: S&P Gives 'BB-' Rating on Corporate Credit ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' preliminary long-term issuer credit rating to Terra-Gen Finance Co. LLC (TG Finance), a 100% owned subsidiary of Terra-Gen Power LLC. "At the same time, we assigned our issue rating of 'BB' to TG Finance's $300 million secured term loan B due 2017 and secured $60 million working capital facility due 2016. We also assigned our '2' preliminary recovery rating to the term loan and working capital facility, reflecting our expectations of substantial (70% to 90%) recovery of principal if a payment default occurs. The outlook is stable," S&P stated. All ratings are preliminary, subject to review of final documentation and conditional on the proposed financing being completed. "On successful completion of the transaction and document review, we would withdraw the preliminary rating, and we would assign issuer, issue and recovery ratings," S&P noted. The ratings on project owner/operator TG Finance reflect its reliance on distributions from its underlying portfolio of renewable energy projects that benefit from purchase power agreements (PPA) with largely investment-grade counterparties and are located mostly in California, which has shown considerable support for renewable energy resources. Two of TG Finance's biggest cash contributors are Alta Wind Holdings LLC (BBB-/Stable) and SEGS VIII and IX (50% owners of Harper Lake Solar Funding Corp.; BBB-/Stable). Ratings also reflect resource concentration (wind), technology risk, asset concentration (the Alta projects), and vulnerability to availability declines and operations and maintenance (O&M) cost increases. Standard & Poor's determined the rating on TG Finance using our developer methodology, of which a key element is the assignment of a quality of cash flow (QCF) score to each dividend stream from the portfolio of assets. "The QCF score reflects our opinion of the dividend stream's potential volatility. While each project may have had individual overriding factors, project-level QCF scores were largely influenced by project-level covenants that can affect its ability to distribute cash to TG Finance, its operational track record, and the terms of the PPA for the project," S&P stated. "The outlook is stable. We expect credit measures to remain supportive of the rating under our base case scenario," said Standard & Poor's credit analyst Marc Sonnenblick. Lower-than-expected availability or generation, or higher O&M costs, especially at the wind projects given their majority contribution to cash flow, could cause a downward ratings revision. In addition, potential lower revenues from projects with recontracting and/or SRAC exposure could pressure ratings, as they represent about 35% of generation. Improved recovery prospects, material improvements in the risk profiles of several assets, or significant debt reduction through the cash sweep could result in an upgrade. TERRESTAR CORP: Court Sets General Bar Date at May 13 ----------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has set May 13, 2011 at 5:00 p.m. as the date by which all proofs of claim must be filed against the TSC Debtors. Government units can file proofs of claim against the TSC Debtors so as to be actually received on or before Aug. 15, 2011, at 5:00 p.m. About TerreStar Corp. and TerreStar Networks TerreStar Corporation and TerreStar Holdings, Inc., filed voluntary Chapter 11 petitions with the U.S. Bankruptcy Court for the Southern District of New York on Feb. 16, 2011. TSC's Chapter 11 filing joins the bankruptcy proceedings of TerreStar Networks Inc. and 12 other affiliates, which were filed on Oct. 19, 2010. The October Chapter 11 cases are procedurally consolidated under TSN's Case No. 10-15446 under Judge Sean H. Lane. TSC is the parent company of each of the October Debtors. TSC has four wholly owned direct subsidiaries: TerreStar Holdings, Inc., TerreStar New York Inc., Motient Holdings Inc., and MVH Holdings Inc. TSC is currently seeking to have its case deemed jointly administered with the cases of seven of the October Debtors under the caption In re TerreStar Corporation, et al., Case No. 11-10612 (SHL). The seven Debtor entities who seek joint administration with TSC are: * TerreStar New York Inc., * Motient Communications Inc. * Motient Holdings Inc., * Motient License Inc., * Motient Services Inc., * Motient Ventures Holdings Inc., and * MVH Holdings Inc. TSC is a Delaware corporation whose main asset is the equity in non-Debtor TerreStar 1.4 Holdings LLC, which has the right to use a "1.4 GHz terrestrial spectrum" pursuant to 64 licenses issued by the Federal Communication Commission. TSC also has an indirect 89.3% ownership interest in TerreStar Network, Inc., which operates a separate and distinct mobile communications business. TerreStar Holdings is a Delaware corporation that directly holds 100% of the interests in 1.4 Holdings LLC. TerreStar Networks Inc. or TSN, the principal operating entity of TSC, developed an innovative wireless communications system to provide mobile coverage throughout the United States and Canada using satellite-terrestrial smartphones. The system, however, required an enormous amount of capital expenditures and initially produced very little in the way of revenue. TSN's available cash and borrowing capacity were insufficient to cover its funding; thus, forcing TSN to seek bankruptcy protection in October 2010. TSC estimated assets and debts of $100,000,001 to $500,000,000 in its Chapter 11 petition. Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serves as counsel for the TSC and TSN Debtors. Garden City Group is the claims and notice agent. Blackstone Advisory Partners LP is the financial advisor. The Garden City Group, Inc., is the claims and noticing agent in the Chapter 11 cases. Otterbourg Steindler Houston & Rosen P.C. is the counsel to the Official Committee of Unsecured Creditors formed in TSN's Chapter 11 cases. FTI Consulting, Inc., is the Committee's financial advisor Bankruptcy Creditors' Service, Inc., publishes TerreStar Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by TerreStar Networks Inc. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TIB FINANCIAL: TIB Bank Merges with NAFH National Bank ------------------------------------------------------ Effective April 29, 2011, TIB Bank, a wholly owned subsidiary of TIB Financial Corp., merged with and into NAFH National Bank, a national banking association and wholly owned subsidiary of North American Financial Holdings, Inc., with NAFH Bank as the surviving entity. NAFH is the owner of approximately 97% of the Company's common stock. In addition, five of the Company's seven directors, and the Company's Chief Executive Officer, Chief Financial Officer and Chief Risk Officer are affiliated with NAFH. NAFH Bank was formed on July 16, 2010 in connection with the purchase and assumption of the operations of three banks - Metro Bank of Dade County (Miami, Florida), Turnberry Bank (Aventura, Florida) and First National Bank of the South (Spartanburg, South Carolina) - from the Federal Deposit Insurance Corporation. On July 16, 2010, NAFH Bank acquired assets of approximately $1.4 billion and assumed deposits of approximately $1.2 billion in the transactions with the FDIC. As of Dec. 31, 2010, NAFH Bank had total assets of $1.2 billion and total deposits of $893 million. Prior to the Merger, NAFH Bank operated 23 branches, with 10 branches in South Florida and 13 branches in South Carolina. NAFH Bank is a party to loss sharing agreements with the FDIC covering the large majority of the loans it acquired from the FDIC. The Merger occurred pursuant to the terms of an Agreement of Merger entered into by and between the Bank and NAFH Bank, dated as of April 27, 2011. In the Merger, each share of Bank common stock was converted into the right to receive shares of NAFH Bank common stock. As a result of the Merger, the Company now owns approximately 53% of NAFH Bank, with NAFH owning the remaining 47%. The Merger Agreement provides that, on or prior to May 15, 2011, the exchange ratio at which shares of TIB Bank were exchanged for shares of NAFH Bank will be adjusted to ensure that it reflects the ratio of the tangible book value per share of TIB Bank to the tangible book value per share of NAFH Bank, in each case as of March 31, 2011. A full-text copy of the Agreement of Merger is available for free at http://is.gd/ZvXiBD About TIB Financial Corp. Headquartered in Naples, Florida, TIB Financial Corp. -- http://www.tibfinancialcorp.com/-- is a financial services company with approximately $1.7 billion in total assets and 28 full-service banking offices throughout the Florida Keys, Homestead, Naples, Bonita Springs, Fort Myers, Cape Coral and Venice. TIB Financial Corp. is also the parent company of Naples Capital Advisors, Inc., a registered investment advisor with approximately $169 million of assets under advisement. TIB Financial Corp., through its wholly owned subsidiaries, TIB Bank and Naples Capital Advisors, Inc., serves the personal and commercial banking and investment management needs of local residents and businesses in its market areas. The Company's balance sheet at Dec. 31, 2010 showed $1.75 billion in total assets, $1.58 billion in total liabilities and $176.75 million in total shareholders' equity. As reported in the Troubled Company Reporter on April 6, 2010, Crowe Horwath LLP, in Fort Lauderdale, Fla., 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 net losses in 2009, 2008 and 2007, primarily from loan and investment impairments. In addition, the Company's bank subsidiary is operating under an informal agreement with bank regulatory agencies that requires, among other provisions, higher regulatory capital requirements. The Bank did not meet the higher capital requirement as of Dec. 31, 2009, and therefore is not in compliance with the regulatory agreement. Failure to comply with the regulatory agreement may result in additional regulatory enforcement actions. The 2010 Annual Report did not contain a going concern doubt. TIMOTHY BLIXSETH: Montana Opposes Case Dismissal ------------------------------------------------ Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that the state of Montana filed papers on May 4 opposing the motion by Timothy Blixseth for dismissal of the involuntary Chapter 7 petition filed against him by three states a month earlier. As reported in the May 3 edition of the TCR, the bankruptcy judge in Las Vegas will convene a hearing on May 18 to consider the renewed request by Mr. Blixseth, the founder of Yellowstone Mountain Club LLC, in Montana, to dismiss the involuntary Chapter 7 bankruptcy petition filed against him by the taxing authorities in California, Montana and Idaho. Mr. Blixseth said he has settled with Idaho and California. He is contesting the entire Montana claim for $59 million, including the $219,000 claim the state used to file the involuntary petition. He argues the involuntary petition should be dismissed because there are no longer three creditors behind it and the lone remaining claim is disputed. Mr. Rochelle relates that Montana responded by pointing to papers Mr. Blixseth filed in state court admitting to owing $219,000. Montana also said that the two settlements show that there were undisputed taxes owed to California and Idaho. Montana points to unpaid state and federal taxes to show that Mr. Blixseth isn't paying his legitimate creditors. The bankruptcy trustee for the Yellowstone Mountain Club, according to Mr. Rochelle, supports having Mr. Blixseth in bankruptcy. The trustee cited his unsatisfied $40 million judgment against Mr. Blixseth as an additional reason for being in bankruptcy. The trustee also said he had "concern about Mr. Blixseth's history of fraudulent transfers." About Timothy Blixseth Tax officials from California, Montana and Idaho on April 5, 2011 filed an involuntary-bankruptcy petition under Chapter 7 against Timothy Blixseth in Las Vegas, Nevada (Bankr. D. Nev. Case No. 11-15010). The three states that signed the petition against the Yellowstone Club co-founder claim they are owed $2.3 million in back taxes. A copy of the petition is available for free at http://bankrupt.com/misc/nvb11-15010.pdf Mr. Blixseth is seeking dismissal of the involuntary petition. Mr. Blixseth and his former wife, Edra Blixseth, founded the Yellowstone Club, near Big Sky, Montana, in 2000 as a ski resort for millionaires looking for vacation homes. Members paid $205 million for 72 properties in 2005 alone. Bloomberg News, citing a court ruling by U.S. Bankruptcy Judge Ralph B. Kirscher, says the couple took cash for their personal use from a $375 million loan arranged by Credit Suisse. Finances at the club deteriorated thereafter, and the club eventually went bankrupt, Judge Kirscher found. Mr. Blixseth was ordered to pay $40 million to the club's creditors under a September ruling by Judge Kirscher. Mr. Blixseth said he's appealing that judgment. About Edra D. Blixseth Edra D. Blixseth owns the Porcupine Creek Golf Club in Rancho Mirage and the Yellowstone Club in Montana. Ms. Blixseth filed for Chapter 11 bankruptcy protection on March 26, 2009 (Bankr. D. Mont. Case No. 09-60452). Gary S. Deschenes, Esq., at Deschenes & Sullivan Law Offices assists Ms. Blixseth in her restructuring efforts. The Debtor estimated $100 million to $500 million in assets and $500 million to $1 billion in debts. The Debtor's case was converted from a Chapter 11 to a Chapter 7 by Court order entered May 29, 2009. About Yellowstone Mountain Located near Big Sky, Montana, Yellowstone Mountain Club LLC -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Club and its affiliates filed for Chapter 11 bankruptcy on Nov. 10, 2008 (Bankr. D. Montana, Case No. 08- 61570). The Company's owner affiliate, Edra D. Blixseth, filed for Chapter 11 on March 27, 2009 (Case No. 09-60452). In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners, LLC, acquired equity ownership in the reorganized Club for $115 million. Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC represented the Debtors. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer, as counsel, and James H. Cossitt, Esq., at local counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. TRADE UNION: Court Authorizes Interim Use of Cash Collateral ------------------------------------------------------------ The U.S. Bankruptcy Court for the Central District of California authorized Trade Union International Inc. and Duck House Inc. on an interim basis to use any cash collateral of Cathay Bank and China Trust Bank. Montclair, California-based Trade Union International Inc. supplies aftermarket aluminum alloy wheels and wheel and truck accessories. It filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 11-13071) on Jan. 31, 2011. James C. Bastian, Jr., Esq., at Shulman Hodges & Bastian LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliate Duck House, Inc., a California corporation, filed a separate Chapter 11 petition on Jan. 27, 2011 (Bankr. C.D. Calif. Case No. 11-13072). TRANS ENERGY: Lisa Corbitt Resigns as Chief Accounting Officer -------------------------------------------------------------- Lisa A. Corbitt resigned as Trans Energy, Inc.'s chief accounting officer. Ms. Corbitt served as the Company's chief financial officer from 2008 until April 19, 2011, when she was appointed chief accounting officer. Ms. Corbitt's resignation was for personal reasons and was effective immediately. At the time of her resignation, there were no disagreements between Ms. Corbitt and the company on any matter relating to the company's operations, policies or practices. The Company has not named a replacement chief accounting officer as of May 2, 2011. About Trans Energy West Virginia-based Trans Energy, Inc. -- http://www.transenergyinc.com/-- is an independent exploration and production company focused on exploring, developing and producing oil and natural gas in the Appalachian Basin. The common shares of the Company are listed for trading on the Over The Counter Bulletin Board under the symbol "TENG". According to the Troubled Company Reporter on Nov. 9, 2010, Trans Energy, Inc., and CIT Capital USA Inc. entered into a forbearance letter agreement on Oct. 29, 2010, whereby CIT agreed to forebear from exercising its rights and remedies against the Company and its property until Dec. 31, 2010. The forbearance relates to a senior secured revolving credit facility. The October Forbearance Letter extends the terms and provisions of the parties' earlier forbearance agreement entered into on July 9, 2010, that extended the forbearance period to Oct. 29, 2010. The Company's balance sheet at Dec. 31, 2010 showed $40.88 million in total assets, $23.41 million in total liabilities and $17.47 million in total stockholders' equity. As reported by the TCR on April 18, 2011, Maloney + Novotny, LLC, in Cleveland, Ohio, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has generated significant losses from operations and has a working capital deficit of $19,699,824 at Dec. 31, 2010. TRIMAS CORP: Moody's Upgrades CFR to 'B1' on Better Credit Metrics ------------------------------------------------------------------ Moody's Investors Service upgraded TriMas' CFR and PDR to B1 from B2. Concurrently, the ratings on the company's $83 million revolving credit, its $20 million Synthetic LC, and on its $253 million term loan facilities were upgraded to Ba2 from Ba3, and the speculative grade liquidity rating was upgraded to SGL-2 from SGL-3. The rating outlook is positive. Upgrades: Issuer: TriMas Corporation -- Probability of Default Rating, Upgraded to B1 from B2 -- Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3 -- Corporate Family Rating, Upgraded to B1 from B2 -- Senior Secured Bank Credit Facility, Upgraded to Ba2, LGD2- 24% from Ba3, LGD2-25% -- Senior Secured Regular Bond/Debenture, Upgraded to B2, LGD5- 71% from B3, LGD5-74% RATINGS RATIONALE The company's ratings upgrade and the positive ratings outlook reflect the improvement in the company's credit metrics over the last 12 months and Moody's belief that the company is well positioned to see further improvement as global economic activity increases. These improvements, combined with recent debt repayment, have helped strengthen the company's key credit metrics. Specifically, revenues grew by 17% in 2010 and its operating margin increased to 12.7% from 6.9% in 2009. The company's leverage (Debt to EBITDA) improved to 3.6 times for 2010 from 5.7 times for 2009 and is expected to improve further over the next couple of years. The ratings benefit from a diversified mix of industry verticals that provide diversity and help mitigate risk. The company's SGL rating was upgraded to SGL-2 from SGL-3, reflecting Moody's view that the company has good liquidity. Although the company has a relatively modest sized revolver, Moody's expects that the company will be able to meet its cash needs through free cash flow generation as well as its current cash position. A rating upgrade to Ba3 could occur as the company experiences a longer track record of improvement, and if free cash flow to debt remained consistently above 12% on a sustainable basis. Adjusted leverage below 3 times could also support positive ratings traction. EBITA to interest above 3.5 times with stable to improving margins at each of the company's divisions could also support a ratings upgrade. The rating could be downgraded if the company's leverage (debt to EBITDA) was to increase to over 4.5 times, or if its free cash flow to debt was anticipated to be below 7% on a consistent basis. Currently, all five of the company's operations are performing well. If one or more of its business segments was expected to experience meaningful year over year contraction, the rating could revert to stable. The outlook could also revert to stable if the company's leverage was to trend towards 4 times. The principal methodology used in rating TriMas was the Global Manufacturing Industry Methodology, published December 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. TriMas Corporation is a multi-industrial manufacturer. The Company is engaged in five business segments with diverse products and market channels in packaging, energy, aerospace & defense, and engineered components. Last twelve months revenues through March 31, 2011 totaled approximately $992 million. TWIN RIVER: Debt Refinancing Plan Cues Moody's 'B2' Rating Review ----------------------------------------------------------------- Moody's Investors Service placed Twin River Management Group, Inc.'s B2 Corporate Family Rating (CFR) and B3 Probability of Default Rating (PDR) on review for possible upgrade. Moody's also assigned B1 ratings to Twin River's proposed $285 million bank credit facility comprised of a $260 million term loan due 2017 and a $25 million revolver expiring in 2016. The review for upgrade is in response to Twin River's announcement that it plans to refinance its existing $300 million senior secured term loan due 2015 (current balance $260 million) with the $285 million proposed bank facility. The completion of the transaction as proposed is expected to result in a one-notch upgrade of Twin River's CFR and PDR and an affirmation of the B1 rating assigned to the proposed bank credit facility. Ratings placed on review for possible upgrade: -- Corporate Family Rating at B2 -- Probability of Default Rating at B3 Ratings assigned: -- $260 million proposed senior secured term loan due 2017 at B1 (LGD 3, 35%) -- $25 million proposed senior secured revolver expiring 2016 at B1 (LGD 3, 35%) Rating affirmed and to be withdrawn upon transaction closing: -- $300 million senior secured term loan due 2015 at B2 (LGD 3, 35%) RATINGS RATIONALE "Assuming the refinancing occurs as proposed, Twin River's short- term and long-term financial flexibility will significantly improve, providing the company the additional cushion it will likely need should Massachusetts ultimately decide to approve casino style gaming," stated Peggy Holloway, Vice President at Moody's. "The review for possible upgrade also reflects the continuation of Twin River's good gaming operations results," added Holloway. The B1 rating assigned to the proposed $285 million bank facility assumes the transaction closes as proposed and ultimately results in a decision by Moody's to upgrade Twin River's CFR to B1. The proposed bank facility will represent the majority of the company's pro forma debt capital structure, and as a result, would be rated the same as the company's CFR. The proposed refinancing is expected to materially lower Twin River's cost of debt, extend its debt maturity profile, and facilitate further debt reduction. The company has repaid approximately $40 million since Dec. 10, 2010. Pro forma for the debt repayment that occurred since Dec. 10, 2010, debt/EBITDA is 3.8 times and EBIT/interest is about 3.8 times. The transaction is expected to close in the next several weeks at which time Moody's will make a decision regarding a possible upgrade. Failure to complete the transaction as proposed would likely result in the affirmation of the Twin River's existing ratings. The principal methodology used in rating Twin River was the Global Gaming Industry Methodology, published December 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Twin River Management Group, Inc.'s (formerly known as BLB Management Services, Inc.) restricted operating subsidiary, UTGR, Inc., owns and operates the Twin River casino located near Providence, Rhode Island. The Twin River casino has approximately 4,752 video lottery terminals. The company is private and does not disclose public financials. TWO BROTHERS: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Two Brothers II, Inc. 16416 N. 92nd Street, Suite B110 Scottsdale, AZ 85260 Bankruptcy Case No.: 11-12868 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Charles G. Case II Debtor's Counsel: D. Lamar Hawkins, Esq. AIKEN SCHENK HAWKINS & RICCIARDI PC 4742 North 24th Street, Suite 100 Phoenix, AZ 85016 Tel: (602) 248-8203 Fax: (602) 248-8840 E-mail: dlh@ashrlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Ali Saad, president. Affiliates that also filed separate Chapter 11 petitions on May 4, 2011: Petition Debtor Case No. Date ------ -------- ---- Two Brothers III, Inc. 11-12877 05/04/11 Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 Two Brothers IV, Inc. 11-12896 05/04/11 Assets: $1,000,001 to $10,000,000 Debts: $500,001 to $1,000,000 Two Brothers VIII, Inc. 11-12898 05/04/11 Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 Affiliates that previously filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- Two Brothers XI, Inc. 10-23048 07/23/10 Two Brothers XII, Inc. 10-23056 07/23/10 Saad Nemer Saad, Inc. 10-23057 07/23/10 Two Brothers V, Inc. 10-28114 09/02/10 Two Brothers VI, Inc. 10-28116 09/02/10 Two Brothers IX, Inc. 10-28118 09/02/10 Two Brothers X, Inc. 10-28120 09/02/10 Two Brothers I, Inc. 11-07952 03/25/11 Two Brothers VII, Inc. 11-07954 03/25/11 One Brother I, Inc. 11-07955 03/25/11 TXU CORP: Bank Debt Trades at 13% Off in Secondary Market --------------------------------------------------------- Participations in a syndicated loan under which TXU Corp., now known as Energy Future Holdings Corp., is a borrower traded in the secondary market at 86.78 cents-on-the-dollar during the week ended Friday, May 6, 2011, an increase of 1.10 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 350 basis points above LIBOR to borrow under the facility. The bank loan matures on October 10, 2014. The loan is one of the biggest gainers and losers among 197 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Energy Future Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leveraged buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. The Company's consolidated balance sheets at Dec. 31, 2010, showed $46.388 billion in total assets, $52.299 billion in total liabilities, and a stockholders' deficit of $5.911 billion. * * * In April 2011, Moody's Investors Service affirmed the 'Caa2' Corporate Family Rating, 'Caa3' Probability of Default Rating and SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially distressed company with limited financial flexibility; its capital structure appears to be untenable, calling into question the sustainability of the business model; and there is no expectation for any meaningful debt reduction over the next few years, beyond scheduled amortizations. At the end of February 2011, Fitch Ratings it does not expect to take any immediate rating action on EFH's Texas Competitive Electric Holdings Company LLC or their affiliates based on recent default allegations from lender Aurelius. EFH carries a 'CCC' corporate rating, with negative outlook, from Fitch. ULTIMATE ESCAPES: Seeks July 18 Plan Exclusivity Extension ---------------------------------------------------------- Ultimate Escapes Holdings LLC and its affiliated debtors have asked the U.S. Bankruptcy Court for the District of Delaware to extend the deadline for filing their Chapter 11 plan to July 18, 2011, and for soliciting acceptances of that plan to Sept. 15, 2011. The Debtors anticipate that the proposed extension will give them sufficient time to finalize the terms of a plan with the Official Committee of Unsecured Creditors in order to file a consensual plan in their cases. About Ultimate Escapes Ultimate Escapes, Inc. -- http://www.ultimateescapes.com/-- is a luxury destination club that sells club memberships offering members reservation rights to use its vacation properties, subject to the rules of the club member's Club Membership Agreement. The Company's properties are located in various resort locations throughout the world. Kissimmee, Florida-based Ultimate Escapes Holdings, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 10- 12915) on Sept. 20, 2010. Affiliates Ultimate Resort, LLC; Ultimate Operations, LLC; Ultimate Resort Holdings, LLC; Ultimate Escapes, Inc. (fka Secure America Acquisition Corporation); P & J Partners, LLC; UE Holdco, LLC; UE Member, LLC, et al., filed separate Chapter 11 petitions. Scott D. Cousins, Esq., Matthew L. Hinker, Esq., and Nancy A. Mitchell, Esq., at Greenberg Traurig LLP, assist the Debtors in their restructuring efforts. CRG Partners Group LLC is the Debtors' chief restructuring officer. BMC Group Inc. is the Company's claims and notice agent. Attorneys at Polsinelli Shughart PC, and Gordon & Rees LLP, represent the Creditors Committee. Ultimate Escapes estimated assets at $10 million to $50 million and debts at $100 million to $500 million as of the Petition Date. UNISYS CORP: Has Form 10-Q; Posts $39.4MM Loss in March 31 Qtr. --------------------------------------------------------------- Unisys Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss attributable to Unisys Corporation of $39.40 million on $911.20 million of revenue for the three months ended March 31, 2011, compared with a net loss attributable to Unisys Corporation of $11.60 million on $977.40 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $2.95 billion in total assets, $3.64 billion in total liabilities, and a $692.10 million total stockholders' deficit. A full-text copy of the quarterly report on Form 10-Q is available for free at http://is.gd/TWygoH About Unisys Corp. Based in Blue Bell, Pennsylvania, Unisys Corporation (NYSE: UIS) -- http://www.unisys.com/-- provides a portfolio of IT services, software, and technology that solves critical problems for clients. With more than 26,000 employees, Unisys serves commercial organizations and government agencies throughout the world. As reported by the Troubled Company Reporter on Feb. 24, 2011, Moody's Investors Service has affirmed Unisys' B1 corporate family rating and all other ratings, and also changed the rating outlook to positive from stable. This outlook change follows the announcement by Unisys of plans to issue mandatory convertible preferred stock, redeem secured notes, and tender for additional bonds which Moody' estimates will reduce secured debt by up to $390 million. Upon completion of the transactions, the loss given default assessments will be revised based on the remaining debt balances. In the May 5, 2011 edition of the TCR, Standard & Poor's Ratings Services raised its corporate credit rating on Blue Bell, Pa.- based Unisys Corp. to 'BB-' from 'B+', and removed the ratings from CreditWatch, where they were placed with positive implications on Feb. 22, 2011. "The upgrade reflects Unisys' improved financial profile following the recent debt redemptions," said Standard & Poor's credit analyst Martha Toll-Reed, "and adequate liquidity, which provides some capacity at the current rating for potential earnings volatility." "The ratings reflect our view that Unisys' improved financial profile and consistently positive annual free cash flow will provide sufficient cushion in the near term to mitigate the potential for ongoing revenue declines and operating performance volatility," added Ms. Toll-Reed. UNIT CORP: Fitch Initiates Coverage With 'BB' IDR ------------------------------------------------- Fitch Ratings has assigned these ratings to Unit Corporation: -- Issuer Default Rating (IDR) 'BB'; -- Senior unsecured debt 'BB'; and -- Senior subordinated debt 'BB-'. The Rating Outlook is Stable. Fitch's ratings are based on UNT's debt-light capital structure, the company's history of low leverage, management's conservative financial policies and the company's perceived financial resiliency to stressed commodity prices. UNT's upstream and drilling businesses continue to benefit from robust oil prices and the resulting higher levels of oil drilling activity in the U.S. UNT's midstream business has indirectly benefited from higher oil prices through increased pricing for natural gas liquids. Offsetting factors include weak natural gas prices and the smaller size of the company's upstream footprint. It is important to note that given the smaller asset footprint of the company, Fitch views the company's conservative financial profile as the key driver to the company's ratings. As a result, failure to maintain a conservative financial profile would be a key catalyst to negative rating actions. UNT is looking to raise approximately $200 million in a 10-year senior subordinated note offering. Net proceeds will be used to repay outstanding borrowings under the company's revolving credit facility and to finance higher capex levels as the company is likely to outspend cash flows in 2011. Increased capex will support expanded oil and gas drilling, primarily in the company's mid-continent properties, as well as capital expenditures in the company's other two lines of business, contract drilling and gas gathering and processing. The senior subordinated notes will be guaranteed on a subordinated basis by certain material subsidiaries of UNT and for so long as the notes are not rated 'investment grade' will contain restrictions on the company's ability to borrow additional money and under certain circumstances to pay dividends and repurchase stock. The notes will be repayable at the holder's option following a 'change of control'. All debt at UNT resides at the holding company (Unit Corporation) and is guaranteed by existing and future domestic restricted subsidiaries. Besides the announced senior subordinated note offering, the only other debt outstanding relates to the company's senior unsecured credit facility. The credit facility currently has $325 million of commitments and at Dec. 31, 2010 UNT had borrowings of $163 million under the facility which matures in May 2012. The facility is governed by a borrowing base ($600 million as of April 1, 2011, which will be reduced by approximately $54 million for the proposed note offering) which is supported by the company's upstream and midstream subsidiaries (note the drilling subsidiary's cash flows are not included in the borrowing base). The credit facility is governed by financial covenants for the current ratio (minimum of 1.0 times [x]), a leverage ratio (maximum of 3.5x) and a minimum tangible net worth covenant (minimum of $900 million). The company remains in compliance will all financial covenants. UNT's upstream operations are conducted through the wholly owned subsidiary Unit Petroleum Company and include total proved reserves at year-end 2010 of 104 million barrels of oil equivalent (MMboe). Reserves are located predominately in the Anadarko Basin (55% of total reserves), the Arkoma Basin (19%) and the Gulf Coast (16%). Full-cycle economics for the company's upstream assets are reasonable for the rating category and benefit from low production expenses despite the company's higher F&D costs. For year-end 2010, three-year average FD&A costs are estimated at $25.32/boe and total cash costs (production expenses, interest expense and cash taxes) are estimated at $12.71/boe. UNT's reserves are composed of approximately 32% oil and proved developed reserves are approximately 80% of total proved reserves. UNT has a strong track record of growing its reserve base organically with one and three year average organic reserve replacement rates of 158% and 145% respectively. Debt levels remain conservative from both a financial metric perspective (debt/EBITDA) and on a debt/boe basis. Pro forma for the announced debt offering, Fitch estimates exploration and production (E&P) debt-to-boe of proved reserves at $1.15/boe and E&P debt-to boe of proved developed reserves at $1.44/boe. Note this includes an allocation of debt to the company's drilling and midstream operations as well as including asset retirement obligations (AROs). UNT's contract drilling operations are conducted through the wholly owned subsidiary Unit Drilling Company and include the company's fleet of 122 domestic land drilling rigs. The company's fleet is composed primarily of 750-2,000 horsepower (hp) rigs which are capable of targeting the prolific domestic shale plays. At March 31, 2011, approximately 62% of the rigs were under contract and the fleet continues to benefit from increasing dayrates and margins. During 2010 and 2011, UNT has continued to enhance its drilling fleet with a number of refurbishments (30 rigs) and through the construction of five new 1,500hp, diesel- electric drilling rigs. Of the five newbuild rigs, one was completed in March 2011 and all five will go to work in the Bakken shale under two-year contracts. UNT's midstream operations are conducted through the wholly owned subsidiary Superior Pipeline Company, LLC and include the company's three gas treatment plants, 10 operating processing plants, and 34 active gathering systems. Operations are conducted in Oklahoma, Texas, Kansas, Pennsylvania and West Virginia. Contracts include a mix between fee based contracts (51% of total volumes in 2010), percent of proceeds (33% of total volumes in 2010) and percent of index (16% of total volumes in 2010). Given the significant increase in natural gas liquids pricing levels, margins have increased substantially given the company's exposure to percent of proceeds and percent of index contracts. As noted, the company maintains a very conservative financial profile. At year-end 2010, total debt/EBITDA was a low 0.37x and interest coverage was a robust 90.2x. During 2010, UNT generated negative free cash flow (FCF) of approximately $94 million which was driven by increased capital expenditure levels following the reduced spending on capex during 2009. It is important to note that management elected to significantly curb capital spending during 2009 to maintain an extremely conservative financial profile during the peak of the economic downturn and resulting low commodity price realizations in early to mid-2009. UNT has hedged a significant portion of 2011 and 2012 production (63% and 48% of oil respectively and 60% and 21% of natural gas respectively) which should mitigate cash flow sensitivity to weaker commodity prices. Should commodity prices fall from current levels, UNT also benefits from significant capital expenditure flexibility as the company has little required drilling to hold existing leaseholds by production (HBP). UNT's operations earned a little over $430 million in EBITDA in 2010, a 19% improvement over 2009 and around 60% of pre-recession levels. The oil and gas business generated almost 75% of the company's operating income in 2010. Contract drilling, UNT's second major earning's contributor, has been EBITDA positive over the last five years, even through the 2009 recession, and supports UNT's oil and gas operations where economically feasible. UNT's gas gathering and processing business is a historically low volatility earning's contributor with operations concentrated in the Texas Panhandle and central and western Oklahoma. Fitch expects a continuation of UNT's recovery in 2011 and does not foresee leverage exceeding 1.0x. This includes a larger capital expenditure budget to support an expanded drilling program in UNT's geographic footprint. UNT has the ability to curtail capital expenditures if need be should oil and gas prices reverse their recent upward trend, and management embraces this philosophy. UNIT CORP: Moody's Assigns B3 Sr. Subordinated Notes Rating ----------------------------------------------------------- Moody's Investors Service assigned first time ratings to Unit Corporation in conjunction with its planned $200 million senior subordinated note offering. The assigned ratings are: a B1 Corporate Family Rating (CFR) and Probability of Default Rating (PDR), a B3 rating to its proposed offering of $200 million senior subordinated notes due 2021 and a SGL-2 Speculative Grade Liquidity rating. Proceeds from the note offering will be used to reduce approximately $170 million of debt under the company's $325 million revolving credit facility. The ratings are subject to review of final documentation. The rating outlook is stable. RATINGS RATIONALE "Unit's durable property base, geographically diversified portfolio of oil and natural gas properties, low leverage, and seasoned management supports its B1 rating," stated Francis J. Messina, Moody's Vice President. "However, the rating also reflects high finding and development costs more reflective of Caa rated companies." Unit's property base is anchored by its stable and consistent growth of reserves driven by its Texas and Oklahoma Panhandle plays. Year-end 2010 reserves totaled 104 mmboe, 68% natural gas and 80% proved developed. Production is bolstered by growing liquids production (50% oil) estimated at 31% at year-end 2010 and growing to 37% by year-end 2011. Unit's strengths are tempered by its high finding and development cost of about $27 per boe. However, the company's very low leverage measured by debt to PD and debt to average daily production totals approximately $2/boe and $6,365/boe, respectively. Additionally, Unit's B1 CFR is supported by a quality 121 drilling rig asset base, 70% of which is capable of drilling horizontal wells, and midstream assets consisting of 860 miles of pipeline with three gas treatment plants and ten gas processing plants. Unit's rating also reflects the cyclical and difficult market conditions of the onshore land rig sub-sector which is prone to intense volatility. The company is exposed to the mature North American land drilling market and the inherent volatility of the natural gas industry, which is expected to remain weak over the next twelve to eighteen months. However, as oil prices have recovered more quickly, Moody's expects Unit to focus more of its fleet on the oil plays. In addition, to continue to benefit from this opportunity for the drilling rig business, Unit may need to increase capital expenditures to upgrade more of its rigs as the market continues to focus on unconventional drilling. Unit's SGL-2 rating reflects good liquidity over the next four quarters primarily due to ample pro forma availability on its $325 million revolver maturing May, 2012. The facility is unsecured with a negative pledge from its subsidiaries. The facility has three financial covenants that include: a current rating greater than 1.0x, a leverage ratio less than 3.5x, and a minimum tangible net worth greater than $900 million. The company should remain well in compliance with its financial covenants. While the bank facility is unsecured, it contains a borrowing base reflective of the asset value of its oil and gas reserves, which is significantly lower than the company's reserve value. Additionally, the company's 121 drilling rigs are not included in the company borrowing base calculation. As a result, Unit has significant alternatives to raise cash. The stable outlook reflects Moody's expectation that Unit will continue its conservative financial management strategy and focus on its operating costs to offset its finding and development cost. The outlook could also be pressured or the ratings downgraded if the company were to significantly increase debt and/or outspend its operating cash flow. To be considered for a positive rating action, the company should double its current production without any material increase to its leverage position. A negative rating action is a possibility if leverage, production or operating costs deteriorate from current levels. The B3 rating for the senior subordinated notes reflects both the overall probability of default of the company, to which Moody's assigns a PDR of B1, and a loss given default of LGD 5 (83%). The proposed subordinated notes have a negative pledge from Unit's subsidiaries. The unsecured revolving credit facility is subject to a borrowing base, which currently calculates to a maximum size of $600 million, which exceeds the current credit facility size of $325 million. The subordination of the notes to the unsecured credit facility results in the notes being rated two notches beneath Unit's B1 CFR, in accordance with Moody's Loss Given Default Methodology. The principal methodology used in rating Unit was Moody's Global Exploration and Production (E&P) Rating Methodology published in December 2010. Unit Corporation, headquartered in Tulsa, Oklahoma, is a diversified energy company engaged in exploration and production, the contract drilling of onshore oil and natural gas wells, and the gathering and processing of natural gas. Operations are principally located in the Mid-Continent region, including the Anadarko, Arkoma, Permian, Rocky Mountains and Gulf Coast Basins. UNIT CORP: Fitch Initiates Coverage with 'BB' IDR ------------------------------------------------- Fitch Ratings has assigned these ratings to Unit Corporation: -- Issuer Default Rating (IDR) 'BB'; -- Senior unsecured debt 'BB'; and -- Senior subordinated debt 'BB-'. The Rating Outlook is Stable. Fitch's ratings are based on UNT's debt-light capital structure, the company's history of low leverage, management's conservative financial policies and the company's perceived financial resiliency to stressed commodity prices. UNT's upstream and drilling businesses continue to benefit from robust oil prices and the resulting higher levels of oil drilling activity in the U.S. UNT's midstream business has indirectly benefited from higher oil prices through increased pricing for natural gas liquids. Offsetting factors include weak natural gas prices and the smaller size of the company's upstream footprint. It is important to note that given the smaller asset footprint of the company, Fitch views the company's conservative financial profile as the key driver to the company's ratings. As a result, failure to maintain a conservative financial profile would be a key catalyst to negative rating actions. UNT is looking to raise approximately $200 million in a 10 year senior subordinated note offering. Net proceeds will be used to repay outstanding borrowings under the company's revolving credit facility and to finance higher capex levels as the company is likely to outspend cash flows in 2011. Increased capex will support expanded oil and gas drilling, primarily in the company's mid-continent properties, as well as capital expenditures in the company's other two lines of business, contract drilling and gas gathering and processing. The senior subordinated notes will be guaranteed on a subordinated basis by certain material subsidiaries of UNT and for so long as the notes are not rated 'investment grade' will contain restrictions on the company's ability to borrow additional money and under certain circumstances to pay dividends and repurchase stock. The notes will be repayable at the holder's option following a 'change of control'. All debt at UNT resides at the holding company (Unit Corporation) and is guaranteed by existing and future domestic restricted subsidiaries. Besides the announced senior subordinated note offering, the only other debt outstanding relates to the company's senior unsecured credit facility. The credit facility currently has $325 million of commitments and at Dec. 31, 2010 UNT had borrowings of $163 million under the facility which matures in May 2012. The facility is governed by a borrowing base ($600 million as of April 1, 2011, which will be reduced by approximately $54 million for the proposed note offering) which is supported by the company's upstream and midstream subsidiaries (note the drilling subsidiary's cash flows are not included in the borrowing base). The credit facility is governed by financial covenants for the current ratio (minimum of 1.0 times [x]), a leverage ratio (maximum of 3.5x) and a minimum tangible net worth covenant (minimum of $900 million). The company remains in compliance will all financial covenants. UNT's upstream operations are conducted through the wholly owned subsidiary Unit Petroleum Company and include total proved reserves at year-end 2010 of 104 million barrels of oil equivalent (MMboe). Reserves are located predominately in the Anadarko Basin (55% of total reserves), the Arkoma Basin (19%) and the Gulf Coast (16%). Full-cycle economics for the company's upstream assets are reasonable for the rating category and benefit from low production expenses despite the company's higher F&D costs. For year-end 2010, three-year average FD&A costs are estimated at $25.32/boe and total cash costs (production expenses, interest expense and cash taxes) are estimated at $12.71/boe. UNT's reserves are composed of approximately 32% oil and proved developed reserves are approximately 80% of total proved reserves. UNT has a strong track record of growing its reserve base organically with one and three year average organic reserve replacement rates of 158% and 145% respectively. Debt levels remain conservative from both a financial metric perspective (debt/EBITDA) and on a debt/boe basis. Pro forma for the announced debt offering, Fitch estimates exploration and production (E&P) debt-to-boe of proved reserves at $1.15/boe and E&P debt-to boe of proved developed reserves at $1.44/boe. Note this includes an allocation of debt to the company's drilling and midstream operations as well as including asset retirement obligations (AROs). UNT's contract drilling operations are conducted through the wholly owned subsidiary Unit Drilling Company and include the company's fleet of 122 domestic land drilling rigs. The company's fleet is composed primarily of 750-2,000 horsepower (hp) rigs which are capable of targeting the prolific domestic shale plays. At March 31, 2011, approximately 62% of the rigs were under contract and the fleet continues to benefit from increasing dayrates and margins. During 2010 and 2011, UNT has continued to enhance its drilling fleet with a number of refurbishments (30 rigs) and through the construction of five new 1,500hp, diesel- electric drilling rigs. Of the five newbuild rigs, one was completed in March 2011 and all five will go to work in the Bakken shale under two-year contracts. UNT's midstream operations are conducted through the wholly owned subsidiary Superior Pipeline Company, LLC and include the company's three gas treatment plants, 10 operating processing plants, and 34 active gathering systems. Operations are conducted in Oklahoma, Texas, Kansas, Pennsylvania and West Virginia. Contracts include a mix between fee based contracts (51% of total volumes in 2010), percent of proceeds (33% of total volumes in 2010) and percent of index (16% of total volumes in 2010). Given the significant increase in natural gas liquids pricing levels, margins have increased substantially given the company's exposure to percent of proceeds and percent of index contracts. As noted, the company maintains a very conservative financial profile. At year-end 2010, total debt/EBITDA was a low 0.37x and interest coverage was a robust 90.2x. During 2010, UNT generated negative free cash flow (FCF) of approximately $94 million which was driven by increased capital expenditure levels following the reduced spending on capex during 2009. It is important to note that management elected to significantly curb capital spending during 2009 to maintain an extremely conservative financial profile during the peak of the economic downturn and resulting low commodity price realizations in early to mid-2009. UNT has hedged a significant portion of 2011 and 2012 production (63% and 48% of oil respectively and 60% and 21% of natural gas respectively) which should mitigate cash flow sensitivity to weaker commodity prices. Should commodity prices fall from current levels, UNT also benefits from significant capital expenditure flexibility as the company has little required drilling to hold existing leaseholds by production (HBP). UNT's operations earned a little over $430 million in EBITDA in 2010, a 19% improvement over 2009 and around 60% of pre-recession levels. The oil and gas business generated almost 75% of the company's operating income in 2010. Contract drilling, UNT's second major earning's contributor, has been EBITDA positive over the last five years, even through the 2009 recession, and supports UNT's oil and gas operations where economically feasible. UNT's gas gathering and processing business is a historically low volatility earning's contributor with operations concentrated in the Texas Panhandle and central and western Oklahoma. Fitch expects a continuation of UNT's recovery in 2011 and does not foresee leverage exceeding 1.0x. This includes a larger capital expenditure budget to support an expanded drilling program in UNT's geographic footprint. UNT has the ability to curtail capital expenditures if need be should oil and gas prices reverse their recent upward trend, and management embraces this philosophy. U.S. EAGLE: Wins Approval to Employ Tobin & Reyes as Local Counsel ------------------------------------------------------------------ U.S. Eagle Corporation and its affiliated debtors sought and obtained approval from the U.S. Bankruptcy Court for the District of New Jersey to employ Tobin & Reyes, P.A. as their local counsel effective Jan. 6, 2011. The Debtors tapped the firm to represent them in a lawsuit they filed against a certain Scott Westphal in a district court in Florida. The lawsuit seeks declaration that the termination of Mr. Westphal did not violate his rights as minority shareholder of U.S. Eagle, and demands him to return corporate property. As local counsel, Tobin & Reyes will handle electronic filings, attend local conferences and court appearances, assist the Debtors' lead counsel, among other things. The firm will be paid on an hourly basis for its services and will be reimbursed for its expenses. Tobin & Reyes does not represent or hold any interest adverse to the Debtors or to the estates. About U.S. Eagle Elizabeth, New Jersey-based U.S. Eagle Corporation sells and rents traffic control related equipment, as well as trench shoring equipment and steel plates primarily in California, Nevada, and Arizona. It designs and distributes golf course maintenance products to customers located principally in the United States. It also owns certain parcels of commercial real estate in Nevada and California and rents them under a long term operating lease of real property located in Trenton, New Jersey. U.S. Eagle filed for Chapter 11 bankruptcy protection on Jan. 6, 2011 (Bankr. D. N.J. Case No. 11-10392). Samuel Jason Teele, Esq., at Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11- 10401), Eagle One Golf Products, Inc. (Bankr. D. N.J. Case No. 11- 10397), Julius Realty Corporation (Bankr. D. N.J. Case No. 11- 10393), Traffic Control Service, Inc., An Arizona Corporation (Bankr. D. N.J. Case No. 11-10398), Traffic Control Service, Inc., A California Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic Control Service, Inc., A Nevada Corporation (Bankr. D. N.J. Case No. 11-10392) filed separate Chapter 11 petitions on Jan. 6, 2011. U.S. EAGLE: Seeks Approval to Employ Three Twenty One as Agent -------------------------------------------------------------- U.S. Eagle Corporation and its affiliated debtors seek approval from the U.S. Bankruptcy Court for the District of New Jersey to employ Three Twenty One Capital Partners LLC as their agent in connection with the sale or disposition of their assets. Three Twenty One will assist in the marketing or disposition of the Debtors' assets, facilitate the dissemination of information to interested buyes, prepare and conduct the sale of the assets, among other things. The Debtors proposed to pay the firm a fee, payable in cash at the closing of the sale of assets. Specifically, Three Twenty One will receive: (1) 5% of the first $1 million of gross sales proceeds; (2) 4% of the proceeds between $1,000,001 and $1,999,999; (3) 3% of the proceeds between $2,000,000 and $2,999,999; (4) 2% of the proceeds between $3,000,000 and $4,999,999; and (5) 1% of the proceeds over $5,000,000. Pursuant to its engagement agreement with the Debtors, the firm will be entitled to receive its fee from any purchase made within 12 months by a prospect contacted during the term of their agreement. Three Twenty One does not have interest adverse to the interest of the Debtors' estate, creditors or equity security holders. About U.S. Eagle Elizabeth, New Jersey-based U.S. Eagle Corporation sells and rents traffic control related equipment, as well as trench shoring equipment and steel plates primarily in California, Nevada, and Arizona. It designs and distributes golf course maintenance products to customers located principally in the United States. It also owns certain parcels of commercial real estate in Nevada and California and rents them under a long term operating lease of real property located in Trenton, New Jersey. U.S. Eagle filed for Chapter 11 bankruptcy protection on Jan. 6, 2011 (Bankr. D. N.J. Case No. 11-10392). Samuel Jason Teele, Esq., at Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11- 10401), Eagle One Golf Products, Inc. (Bankr. D. N.J. Case No. 11- 10397), Julius Realty Corporation (Bankr. D. N.J. Case No. 11- 10393), Traffic Control Service, Inc., An Arizona Corporation (Bankr. D. N.J. Case No. 11-10398), Traffic Control Service, Inc., A California Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic Control Service, Inc., A Nevada Corporation (Bankr. D. N.J. Case No. 11-10392) filed separate Chapter 11 petitions on Jan. 6, 2011. U.S. EAGLE: Seeks Sept. 2 Plan Exclusivity Extension ---------------------------------------------------- U.S. Eagle Corporation and its affiliated debtors have asked the U.S. Bankruptcy Court for the District of New Jersey to extend the deadline for filing their Chapter 11 plan to Sept. 2, 2011, and for soliciting acceptances of that plan to Nov. 1, 2011. About U.S. Eagle Elizabeth, New Jersey-based U.S. Eagle Corporation sells and rents traffic control related equipment, as well as trench shoring equipment and steel plates primarily in California, Nevada, and Arizona. It designs and distributes golf course maintenance products to customers located principally in the United States. It also owns certain parcels of commercial real estate in Nevada and California and rents them under a long term operating lease of real property located in Trenton, New Jersey. U.S. Eagle filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 11-10392) on Jan. 6, 2011. Samuel Jason Teele, Esq., at Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11- 10401), Eagle One Golf Products, Inc. (Bankr. D. N.J. Case No. 11- 10397), Julius Realty Corporation (Bankr. D. N.J. Case No. 11- 10393), Traffic Control Service, Inc., An Arizona Corporation (Bankr. D. N.J. Case No. 11-10398), Traffic Control Service, Inc., A California Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic Control Service, Inc., A Nevada Corporation (Bankr. D. N.J. Case No. 11-10392) filed separate Chapter 11 petitions on Jan. 6, 2011. U.S. EAGLE: Wants Lease Assumption Deadline Moved to Aug. 4 ----------------------------------------------------------- U.S. Eagle Corporation and its affiliated debtors have asked the U.S. Bankruptcy Court for the District of New Jersey to give them until Aug. 4, 2011, to assume or reject their unexpired nonresidential real property leases. The deadline for the Debtors to assume or reject their leases expired on May 6, 2011. About U.S. Eagle Elizabeth, New Jersey-based U.S. Eagle Corporation sells and rents traffic control related equipment, as well as trench shoring equipment and steel plates primarily in California, Nevada, and Arizona. It designs and distributes golf course maintenance products to customers located principally in the United States. It also owns certain parcels of commercial real estate in Nevada and California and rents them under a long term operating lease of real property located in Trenton, New Jersey. U.S. Eagle filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 11-10392) on Jan. 6, 2011. Samuel Jason Teele, Esq., at Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11- 10401), Eagle One Golf Products, Inc. (Bankr. D. N.J. Case No. 11- 10397), Julius Realty Corporation (Bankr. D. N.J. Case No. 11- 10393), Traffic Control Service, Inc., An Arizona Corporation (Bankr. D. N.J. Case No. 11-10398), Traffic Control Service, Inc., A California Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic Control Service, Inc., A Nevada Corporation (Bankr. D. N.J. Case No. 11-10392) filed separate Chapter 11 petitions on Jan. 6, 2011. U.S. FOODSERVICE: $400MM Sr. Unsec. Notes Get Moody's Caa2 Rating ----------------------------------------------------------------- Moody's Investors Service assigned a B3 rating to U.S. Foodservice, Inc.'s proposed $425 million secured term loan due 2017 and a Caa2 rating to its proposed $400 million senior unsecured notes issue due 2019. Additionally, given the changes in the capital structure, Moody's adjusted to B3 from B2, the ratings on the $1.96 billion senior secured term loan. All other ratings for U.S. Foodservice, Inc., including the B3 Corporate Family and Probability of Default ratings, were affirmed. The rating outlook remains stable. Net proceeds from the transaction together with cash and ABL borrowings, are expected to be used to redeem the $1.0 billion senior unsecured notes due 2015. Moody's will withdraw the rating on the 2015 notes upon their full retirement. The assigned ratings are subject to review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. Additionally, USF also intends to extend the maturity of its $1.1 billion asset based revolving credit facility from 2013 to 2016 through an amend and extend transaction. Subsequent to the completion of the proposed amendment, the ratings on the asset based revolving credit facility will be withdrawn. New ratings assigned: -- $425 million senior secured term loan due 2017 at B3 (LGD 3, 47%) -- $400 million senior unsecured notes due 2019 at Caa2 (LGD 5, 86%) Ratings affirmed and LGD point estimates adjusted include: -- Corporate Family Rating at B3 -- Probability of Default Rating at B3 -- $1,100 million asset based revolving credit facility due 2013 at B2 (LGD 3, 43%) from B2 (LGD 3, 41%) -- $521 million senior subordinated notes due 2017 at Caa2 (LGD 6, 93%) from Caa2 (LGD 6, 94%) Rating downgraded: -- $1,964 million senior secured term loan due 2014 to B3 (LGD 3, 47%) from B2 (LGD 3, 41%) RATINGS RATIONALE "The affirmation of USF's B3 Corporate Family Rating acknowledges the continuing incremental improvement in its cash flows and credit metrics resulting from a combination of improved product and customer mix, supply chain optimization and disciplined expense reduction, though there remains work to be done on all fronts," stated Moody's Senior Analyst Charlie O'Shea. "The B3 rating also considers the fact that the proposed financing is overall leverage neutral, as a result of which the company remains highly leveraged with weak credit metrics for its rating category." While USF's performance has gained traction from an improved pricing discipline, supply chain optimization and better vendor costing terms, given its heavy interest burden and capital expenditure needs, it will be difficult for the company to significantly reduce debt and materially improve credit metrics purely from operating cash flows. Additionally, Moody's expects the effect of higher fuel prices on USF's profitability to be somewhat muted in the near to medium term, given the company's ability to assess fuel surcharges, as well as hedge rising fuel costs through forward purchase contracts. The B3 rating on the proposed $425 million secured term loan considers its collateral package consisting of second liens on assets securing the $1.1 billion asset-based revolving credit facility and first lien on all other assets of the company, excluding the assets securing the asset-based securitization program and the CMBS facility. The B3 rating also reflects the credit support provided by the proposed $400 million senior unsecured notes below the secured term loan in the consolidated capital structure. The Caa2 rating on the proposed $400 million unsecured notes reflects their junior position in the capital structure due to their effective subordination to the secured debt above it. The adjustment to B3 of the $1.96 billion term loan, results from its weakened position in the capital structure due to the proposed net $600 million repayment of unsecured notes that had previously provided support for these securities. The stable rating outlook is based on Moody's expectation that USF's credit metrics will continue to incrementally improve to a level that is more representative of the current B3 rating. The stable outlook also reflects Moody's view that the company's qualitative factors -- a solid franchise and market position -- help to balance out its weak quantitative profile. At present, there is minimal upward pressure on the company's ratings given its highly leveraged profile and the aggressive financial policy mandated by its sponsors. Absent a significant improvement in operations, Moody's expects only modest improvements in credit metrics. Quantitatively, an upgrade could occur if debt/EBITDA sustains at 6 times, EBITA/interest remains above 1.25 times, and financial policy remains tempered. In the event that the company's overall liquidity profile deteriorates, which includes the failure to refinance the July 2012 CMBS maturity in a timely manner, the ratings could be downgraded. Also, if credit metrics do not improve such that debt/EBITDA begins making tangible progress towards 7 times, or if EBITA/interest falls below 1 time, ratings could be downgraded. The principal methodologies used in this rating were Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009, as well as other rating methodologies. U.S. Foodservice, Inc. ("USF") is a leading North American food service marketing and distribution company, with annual revenues of around $19 billion. USEC INC: First Amendment to 2009 Equity Incentive Plan Approved ---------------------------------------------------------------- At the 2011 Annual Meeting of Shareholders held on April 28, 2011, the shareholders of USEC Inc. approved the First Amendment to the USEC Inc. 2009 Equity Incentive Plan. The Amendment was adopted by the Board of Directors of the Company on Feb. 17, 2011, subject to approval of the shareholders. As described in the Company's proxy statement on Schedule 14A filed with the Securities and Exchange Commission on March 17, 2011, the Amendment: -- Increases by 3,000,000 (from 4,500,000 to 7,500,000) the number of shares with respect to which awards may be granted under the Plan; -- Modifies the existing "clawback" provision of the Plan to also provide that any awards under the Plan will be subject to any compensation recovery or "clawback" policy that may be adopted by the Board from time to time, including retroactively, in order to implement final rulemaking under Section 954 of the Dodd-Frank Act or any future changes in law or regulation; -- Makes more explicit that with respect to all awards whose vesting is contingent on performance, no dividends or dividend equivalents will be paid unless and until the award vests; and -- Extends the expiration date of the Plan from Feb. 25, 2019 to Feb. 17, 2021 (the tenth anniversary of the Board's adoption of the Amendment). USEC's shareholders also voted on five proposals: (1) Election of eleven directors to hold office until the next annual meeting of shareholders and until his or her successor is elected and has qualified. * James R. Mellor, Chairman * Michael H. Armacost * Joyce F. Brown * Sigmund L. Cornelius * Joseph T. Doyle * H. William Habermeyer * William J. Madia * W. Henson Moore * Walter E. Skowronski * M. Richard Smith * John K. Welch (2) Advisory vote on executive compensation. (3) One year advisory vote on executive compensation. (4) The First Amendment to the USEC Inc. 2009 Equity Incentive Plan. (5) Ratification of the appointment of PricewaterhouseCoopers LLP as the Company's independent auditors for 2011. About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- supplies enriched uranium fuel for commercial nuclear power plants. The Company's balance sheet at March 31, 2011 showed $4.05 billion in total assets, $2.71 billion in total liabilities and $1.34 billion in stockholders' equity. * * * USEC Inc. carries 'Caa1' corporate and probability of default ratings, with "developing" outlook, from Moody's, and 'CCC+' long term foreign issuer credit rating and 'CCC-' long term local issuer credit rating, with outlook "developing", from Standard & Poor's. In May 2010, S&P said that its rating and outlook on USEC Inc. are not affected by the announcement that Toshiba Corp. and Babcock & Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co., have signed a definitive investment agreement for $200 million with USEC. USEC INC: Incurs $16.6 Million Net Loss in March 31 Quarter ----------------------------------------------------------- USEC Inc. reported a net loss of $16.60 million on $380.50 million of total revenue for the three months ended March 31, 2011, compared with a net loss of $9.70 million on $344.70 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011 showed $4.05 billion in total assets, $2.71 billion in total liabilities and $1.34 billion in stockholders' equity. "We've had several important successes thus far in 2011 but we knew our financial results would be reduced by higher costs," said John K. Welch, USEC president and chief executive officer. "We expect gross profit margins for 2011 will be compressed by higher production and purchase costs reflected in our average SWU inventory cost." A full-text copy of the press release announcing the financial results is available for free at http://is.gd/Q39QWf About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- supplies enriched uranium fuel for commercial nuclear power plants. * * * USEC Inc. carries 'Caa1' corporate and probability of default ratings, with "developing" outlook, from Moody's, and 'CCC+' long term foreign issuer credit rating and 'CCC-' long term local issuer credit rating, with outlook "developing", from Standard & Poor's. In May 2010, S&P said that its rating and outlook on USEC Inc. are not affected by the announcement that Toshiba Corp. and Babcock & Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co., have signed a definitive investment agreement for $200 million with USEC. USG CORP: Dismissal of Writ of Mandate Proceeding Reversed ---------------------------------------------------------- Sierra Club appeals from an order granting the motion of respondents Imperial County, the Imperial County Planning Commission, and United States Gypsum Company for reconsideration and dismissing Sierra Club's proceeding for a peremptory writ of mandate. In that proceeding, Sierra Club sought a writ directing respondents to prepare an Environmental Impact Report in compliance with the California Environmental Quality Act for the expansion and modernization of USG's wallboard manufacturing plant in Plaster City, California. Sierra Club contends the trial court lacked jurisdiction to grant reconsideration and exceeded its authority by dismissing the proceeding. It maintains dismissal of its proceeding was unwarranted because it diligently prosecuted the matter and timely requested a hearing under Public Resources Code section 21167.4. In a May 3, 2011 decision penned by Justice Terry B. O'Rourke, the Court of Appeals of California, Fourth District, Division One, held that the lower court did not clearly err in reconsidering its decision. However, the appeals court held the lower court's dismissal on grounds of unreasonable or inexcusable delay in prosecution is without any reasonable justification, and thus was an abuse of discretion. Accordingly, the appeals court reversed the order dismissing Sierra Club's petition. The appellate case is Sierra Club, Plaintiff and Appellant, v. Imperial County et al., Defendants and Respondents, United States Gypsum Company, Real Party in Interest and Respondent, No. D056919 (Calif. App. Ct.). A copy of the appeals court's decision is available at http://is.gd/vSJWiMfrom Leagle.com. About USG Corporation Based in Chicago, Ill., USG Corporation -- http://www.usg.com/-- through its subsidiaries, manufactures and distributes building materials producing a wide range of products for use in new residential, new nonresidential and repair and remodel construction, as well as products used in certain industrial processes. The company filed for Chapter 11 protection on June 25, 2001 (Bankr. Del. Case No. 01-02094). When the Debtors filed for protection from their creditors, they disclosed $3,252,000,000 in assets and $2,739,000,000 in debts. The Debtors emerged from bankruptcy protection on June 20, 2006. VILLASENOR INC: Case Summary & 16 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Villasenor Inc. dba Tacos Don Chente of Long Beach 101 W. Pacific Coast Highway Long Beach, CA 90806 Bankruptcy Case No.: 11-29586 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Thomas B. Donovan Debtor's Counsel: Robert M. Yaspan, Esq. LAW OFFICES OF ROBERT M YASPAN 21700 Oxnard St., Ste 1750 Woodland Hills, CA 91367 Tel: (818) 905-7711 Fax: (818) 501-7711 E-mail: court@yaspanlaw.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 16 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb11-29586.pdf The petition was signed by Dorian Villasenor, president. VINCENZA LEONELLI-SPINA: 3rd Cir. Affirms Non-Dischargeability -------------------------------------------------------------- Vincenza Leonelli-Spina took an appeal from a March 16, 2009 Bankruptcy Court decision in an adversary proceeding granting summary judgment to creditor James R. Albro. The Bankruptcy Court determined that the doctrine of collateral estoppel applied to prevent Ms. Leonelli-Spina from defending the dischargeability of her debt to Mr. Albro. The District Court affirmed the decision of the Bankruptcy Court, and the Debtor brought the matter before the U.S. Court of Appeals of the Third Circuit. On May 4, 2011, the Third Circuit held that there was no error in the application of the doctrine of collateral estoppel to preclude Ms. Leonelli-Spina from re-litigating the questions of whether she had engaged in conduct constituting fraud and breach of fiduciary duties. The Third Circuit affirmed. Ms. Leonelli-Spina was a New Jersey attorney, initially employed as an associate in the firm of John Feczko. In 1994, the firm undertook the representation of John R. Albro, a police officer who was filing suit against his employer. In the context of this suit, Mr. Albro directed that the proceeds of his pension checks should be held in trust by his attorneys. Ms. Leonelli-Spina separated from the Feczko firm in 1996, and Mr. Albro remained as her client. Ms. Leonelli-Spina later claimed that she and Mr. Albro entered into an hourly fee arrangement. Mr. Albro, however, asserted that the representation was on a contingent fee basis. Mr. Albro's case against his employer was finally settled in 2001. In addition to back wages and an increased pension as well as payment for sick leave and other benefits, Mr. Albro's employer paid him $270,000 for the release of other claims and $165,000 for attorneys' fees. Mr. Albro understood that the fee portion of the settlement with his former employer satisfied his entire fee obligation to Ms. Leonelli-Spina. Subsequent to the settlement with his employer, however, Mr. Albro learned that Ms. Leonelli-Spina had accessed the trust account into which his pension payments had been deposited and withdrew funds for counsel fees. He also learned that the amounts withdrawn from his trust account were in addition to the $165,000 allotted to fees in the settlement. Mr. Albro sued Leonelli-Spina in New Jersey Superior Court. On Sept. 10, 2007, the New Jersey Superior Court found that she had violated the rules of Professional Conduct in withdrawing the funds, had committed common-law fraud, tortiously converted Mr. Albro's funds, failed to pay Mr. Albro's taxes, and committed breach of contract and breach of fiduciary duty. Compensatory damages, including interest and penalties, totaling $486,932.28 were awarded. Because of the death of the trial judge, an award of punitive damages was delayed until Oct. 3, 2008, when they were assessed at $350,000, together with $145,297.85 in attorney's fees and $16,305 in costs. Ms. Leonelli-Spina filed for bankruptcy on Nov. 1, 2007. On Sept. 15, 2008, the Bankruptcy Court entered an order confirming her Chapter 11 Plan of Reorganization, and recognizing that the bankruptcy claim was filed in good faith. Mr. Albro commenced an adversary proceeding and filed a motion for summary judgment in the Bankruptcy Court, requesting the court to find that the New Jersey judgment was not dischargeable in bankruptcy. This was so, he claimed, because the debt was incurred as a result of Ms. Leonelli-Spina's commission of fraud or defalcation while acting in a fiduciary capacity. The Bankruptcy Court agreed, finding that the question of whether Ms. Leonelli-Spina's actions were fraudulent had been litigated in the state court action and could not be relitigated in the bankruptcy proceeding. The appellate case is, James R. Albro, v. Vincenza Leonelli-Spina, No. 10-2072 (3rd Cir.). A copy of the Third Circuit's May 4 Opinion, penned by Circuit Judge Thomas I. Vanaskie, is available at http://is.gd/rLt21Tfrom Leagle.com. Circuit Judges Joseph Scirica and Thomas L. Ambro round up the three-judge panel. VITRO SAB: Says Ch. 15 Should Stay in NY as Texas Judge Ill ----------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Vitro SAB argued in a court filing on May 4 that its Chapter 15 case should remain in New York because the bankruptcy judge in Fort Worth, Texas, is ill. Holders of some of the $1.2 billion in defaulted bonds filed a motion to transfer the Chapter 15 case to Texas. Vitro filed its second Chapter 15 petition in New York on April 14 after a judge in Mexico reinstated the previously dismissed Mexican reorganization. Mr. Rochelle notes that under bankruptcy law, the court in Texas with the first-filed case has the right to decide if it will take a later case filed elsewhere. Vitro says that the judge in New York, who had no prior familiarity with Vitro, is in the same position as the other Texas judges because U.S. Bankruptcy Judge Russell Nelms, who originally heard Vitro cases, will be off the bench temporarily. Fintech Investments Ltd., calling itself a substantial creditor, supports Vitro's bid to keep the Chapter 15 case in New York. VITRO SAB: Committee Looking for Higher Offer for U.S. Units ------------------------------------------------------------ Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Vitro SAB's official creditors' committee asked for a delay in the hearing scheduled to begin May 6 in Texas on a motion to approve sale procedures for the four U.S. Vitro subsidiaries that put themselves into Chapter 11 in the face of involuntary petitions filed in November. With regard to selling the U.S. companies, the committee is asking the judge for a one-week adjournment of the hearing for approval of auction procedures. In the meantime, the creditors' panel wants to look into a higher offer and investigate the "independence of the stalking horse bidder." A union pension plan supports the creditors and says there is no reason for a quick sale. Vitro is seeking approval to engage in a sale process where Grey Mountain Partners LLC from Boulder, Colorado, would buy Vitro's U.S. units for $44 million absent higher and better bids at an auction. Under the sale contract, Grey Mountain would receive a 3% break-up if it is outbid at the auction. Vitro competitor Arch Aluminum & Glass Co. Inc., an affiliate of Sun Capital Partners Inc., a private-equity investor from Boca Raton, Florida, has come out in the open, offering to be the stalking horse bidder with a $45 million bid, and no break-up fee. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan to buy back or swap US$1.2 billion in debt from bondholders based on the vote of US$1.9 billion of intercompany debt when third-party creditors were opposed. Vitro as a result dismissed the first Chapter 15 petition following the ruling by the Mexican court. On April 12, 2011, an appellate court in Mexico reinstated the reorganization. Accordingly, Vitro SAB on April 14 re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10- 47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Vitro America, et al., have tapped Louis R. Strubeck, Jr., Esq., and William R. Greendyke, Esq., at Fulbright & Jaworski LLP, in Dallas, Texas, as counsel. Kurtzman Carson Consultants is the claims and notice agent. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. VITRO SAB: Proposes Bonus Program for Top Managers -------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that to retain top-level managers, Vitro SAB is proposing a bonus program. Vitro filed a motion on May 4 for approval of bonus programs for 17 top executives. The chief executive officer and chief financial officer would benefit from an incentive program that would cost $1.02 million at most. To qualify, the U.S. companies must be sold for more than $44 million, the price in the contract already in hand. If the sale is more than $44 million and less than $50 million, the bonus would be 3.75% of the amount above $44 million. The executives would receive 4.5% of the price above $50 million. The maximum bonus would be earned at a sale price of about $74.6 million. For 15 high-level mangers, Vitro is proposing a bonus pool of $267,700. To qualify for payment equaling 12.5% of a year's salary, the managers must still be employed when the sale of the business is completed. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan to buy back or swap US$1.2 billion in debt from bondholders based on the vote of US$1.9 billion of intercompany debt when third-party creditors were opposed. Vitro as a result dismissed the first Chapter 15 petition following the ruling by the Mexican court. On April 12, 2011, an appellate court in Mexico reinstated the reorganization. Accordingly, Vitro SAB on April 14 re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10- 47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Vitro America, et al., have tapped Louis R. Strubeck, Jr., Esq., and William R. Greendyke, Esq., at Fulbright & Jaworski LLP, in Dallas, Texas, as counsel. Kurtzman Carson Consultants is the claims and notice agent. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. WASHINGTON STATE HOUSING: S&P Raises Revenue Bonds From 'BB/B' -------------------------------------------------------------- Standard & Poor's Ratings Services raised its rating on Washington State Housing Finance Commission's variable-rate demand nonprofit revenue bonds series 2005 (for the Seattle Art Museum project) due July 1, 2033, to 'AA-/A-1+' from 'BB/B'. "At the same time, we removed our rating from CreditWatch with negative implications, where we had placed it on Feb. 7, 2011," S&P noted. "The 'AA-' long-term component of our rating is based on our long- term issuer credit rating on U.S. Bank N.A. and addresses full and timely payments of interest and principal when the bondholders have not exercised the put option. The 'A-1+' short-term component of our rating is based on our short-term issuer credit rating on U.S. Bank N.A. and addresses full and timely payments of interest and principal when the bondholders have exercised the put option," S&P stated. The rating action reflects the replacement of the letter of credit (LOC) that Allied Irish Banks PLC (BB/Watch Neg/B) had provided with a new LOC from U.S. Bank N.A. (AA-/Stable/A-1+). Under the new LOC, U.S. Bank N.A. fully supports all bond payment obligations when the bonds are in the daily and weekly interest rate reset modes. Therefore, our rating applies only during these rate modes," S&P explained. S&P continued, "In view of the series 2005 bond structure, changes to our rating on the daily and weekly rate bonds can result from, among other things, changes to our ratings on the LOC provider or amendments to the terms of the transaction. We will maintain our rating on the bonds as long as they are in the daily or weekly rate modes and the LOC has not expired or otherwise terminated. If either of these conditions changes, we will likely withdraw our rating on the bonds." WILLOW GLEN: Case Summary & 2 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Willow Glen Investments, LLC 621 Tully Road, A101 San Jose, CA 95111 Bankruptcy Case No.: 11-54320 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court Northern District of California (San Jose) Judge: Charles Novack Debtor's Counsel: Anh V. Trinh, Esq. TSAO-WI, CHOW AND YEE, LLP 15 N. Market St. San Jose, CA 95113 Tel: (408) 293-6275 E-mail: avtrinh@hotmail.com Scheduled Assets: $1,200,700 Scheduled Debts: $3,712,324 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb11-54320.pdf The petition was signed by Son Nguyen, president. WORLDWORKS DEVELOPMENT: Case Summary & 4 Largest Unsec Creditors ---------------------------------------------------------------- Debtor: Worldworks Development Group, LLC 5001 National Western Drive Denver, CO 80216-2130 Bankruptcy Case No.: 11-20533 Chapter 11 Petition Date: May 4, 2011 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Elizabeth E. Brown Debtor's Counsel: Jeffrey S. Brinen, Esq. KUTNER MILLER BRINEN, P.C. 303 E. 17th Ave., Suite 500 Denver, CO 80203 Tel: (303) 832-2400 E-mail: jsb@kutnerlaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cob11-20533.pdf The petition was signed by Thomas R. Anthony, manager. XERIUM TECHNOLOGIES: Moody's Upgrades CFR to 'B2' from 'B3' ----------------------------------------------------------- Moody's Investors Service upgraded the corporate family rating of Xerium Technologies, Inc. to B2 from B3. A Ba2 rating was assigned to a proposed $285 million senior secured credit facility and a B3 rating was assigned to a proposed $240 million senior unsecured note offering. Additionally, the Speculative Grade Liquidity Rating was raised to SGL-2 from SGL-3. The rating outlook is stable. Xerium is seeking to refinance its existing $20 million revolver, $416 million second lien term loan and $60 million in first lien term loans with a new $40 million revolver, a $120 million secured term loan, Euro 87 million secured term loan, $240 million senior unsecured notes and a portion of its cash on hand. The refinancing is expected to be leverage neutral, excluding fees and expenses, and the revolver is anticipated to be undrawn at close. The ratings are subject to the conclusion of the proposed transaction and Moody's review of final documentation. RATINGS RATIONALE The upgrade to B2 reflects Xerium improved financial flexibility with its improved liquidity profile and expectations of leverage metrics in line with a solid B credit rating. Including Moody's standard adjustments for items such as operating leases and pensions, financial leverage (total debt / EBITDA) is expected to be around 5.5 times over the next 12 to 18 months. Xerium's sizable market position and moderate geographic diversity also provide support to the rating. The ratings are constrained by the company's small revenue base, Moody's expectation that the supply of clothing and roll covers will remain very competitive and the inherent vulnerability of earnings to highly cyclical paper demand, input costs and exchange rates. The upgrade in the liquidity rating to SGL-2 from SGL-3 reflects Xerium's improved liquidity profile, characterized by improved head room under financial covenants, modest cash flow generation, and approximately $30 million of cash on-hand. The company's existing revolver is undrawn and the proposed financing will increase the revolver availability and will improve the company's debt maturity profile. The stable outlook reflects Moody's expectation that Xerium will continue to reduce financial leverage through modest revenue and earnings growth. The ratings or outlook could be raised over time if additional debt is retired and financial leverage and interest coverage approach 4.5 times and 2.5 times, respectively. The ratings or outlook could be lowered if Xerium loses market share, margins erode materially, or the company makes sizable debt-funded acquisitions such that financial leverage approaches 6 times. Upgrades: Issuer: Xerium Technologies, Inc. -- Probability of Default Rating, Upgraded to B2 from B3 -- Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3 -- Corporate Family Rating, Upgraded to B2 from B3 Assignments: Issuer: Xerium Technologies Limited -- Senior Secured Bank Credit Facility, Assigned a 21 - LGD2 to Ba2 Issuer: Xerium Technologies, Inc. -- Senior Secured Bank Credit Facility, Assigned a 21 - LGD2 to Ba2 -- Senior Secured Bank Credit Facility, Assigned a 21 - LGD2 to Ba2 -- Senior Unsecured Regular Bond/Debenture, Assigned a 76 - LGD5 to B3 The principal methodology used in rating Xerium was the Global Paper and Forest Products Industry Methodology, published September 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Xerium Technologies, Inc., headquartered in Raleigh, NC, is a manufacturer and supplier of consumable products used primarily in the production of paper such as paper machine clothing and roll covers. XERIUM TECHNOLOGIES: S&P Affirms 'B' CCR; Outlook Stable -------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Raleigh, N.C.-based Xerium Technologies Inc. "At the same time, we are assigning our 'BB-' issue-level rating (two notches higher than the CCR) to the company's proposed new first-lien debt which includes a $40 million revolver, a $120 million term loan, and a ?87 million term loan issued by U.K.- based subsidiary Xerium Technologies Ltd. The recovery rating is '1', indicating our expectation of very high (90%-100%) recovery in a payment default scenario," S&P said. "We are also assigning a 'B' issue-level rating (the same as the CCR) to the company's proposed $240 million senior unsecured notes. The recovery rating on this debt is '4', indicating our expectation of average (30%-50%) recovery in a payment default scenario. We expect the company to use proceeds from the new facility and notes to redeem all outstanding debt under its existing revolver and term loan. The outlook is stable," S&P continued. "We expect Xerium to benefit modestly from the gradual recovery in global papermaking end markets," said Standard & Poor's credit analyst Sarah Wyeth. "We believe slow revenue growth and an operating margin of around 20% will enable the company to maintain credit measures appropriate for the current rating." "The ratings reflect our view of the company's weak business risk profile and highly leveraged financial risk profile. The business risk profile takes into account the company's presence in the cyclical and competitive market for papermaking products, limited end-user industry diversification, and our expectation that structurally weak medium-term demand in mature markets would likely continue to pressure prices for the company's products. In our view, Xerium's relatively variable cost structure and sound margin profile, as well as its fair geographic diversification, partially offset these weaknesses. Xerium's geographic diversification should enable it to benefit from more-positive industry fundamentals in emerging markets," according to S&P. The outlook is stable. "We could lower the ratings if Xerium's operating performance does not stabilize consistent with our expectations and the company does not use free cash flow to reduce debt," Ms. Wyeth continued. "If EBITDA declines--and the company does not reduce debt, which could result in limited EBITDA headroom over its financial covenants, we could consider lowering the ratings. Factors that could contribute to such a scenario would be continued global economic weakness, increased pricing pressures, and adverse foreign exchange movements. We could consider raising the ratings if the company improves leverage to about 4.5x and we expect it to stay at this level, which we believe Xerium could achieve through revenue growth, stable operating margins, and by applying free cash flow to debt reduction. We would also expect the company to adhere to a financial policy consistent with a higher rating." YRC WORLDWIDE: Fitch Cuts IDR to 'C'; Bankruptcy Remains Likely --------------------------------------------------------------- Fitch Ratings has taken these rating actions on YRC Worldwide Inc. and withdrawn all ratings: -- Issuer default rating (IDR) downgraded to 'C' from 'CC'; -- Secured bank credit facility rating downgraded to 'CCC/RR2' from 'B-/RR2'; -- Senior unsecured rating affirmed at 'C/RR6'. In addition, Fitch has removed YRCW's ratings from Rating Watch Negative. The rating actions follow YRCW's announcement on April 29, 2011 that it had entered into a support agreement with certain of the company's lenders on a package of actions that will constitute an out-of-court restructuring of the company. As detailed in the agreement, the transaction reduces the company's outstanding debt obligations and increases its liquidity. However, Fitch views the exchange of new equity for a portion of the outstanding bank debt obligations (including deferred interest and fees) as a coercive debt exchange (CDE) according to Fitch's CDE criteria. In addition, although it appears increasingly likely that the company will successfully complete the restructuring, until the transactions constituting the restructuring close, which is not anticipated until late July 2011, there exists a potential for the transaction to fail, in which case Fitch expects the company would be forced to file for Chapter 11 bankruptcy protection. Although YRCW's lenders will receive a majority ownership stake in the company following the restructuring, as well as governance control with a two-thirds majority on the Board of Directors, the transaction qualifies as a CDE according to Fitch's published criteria. The latest round of concessions in the company's labor agreement with the Teamsters is contingent upon the company's lenders accepting at least a $300 million reduction in principal and fees owed to them. Not reducing the level of bank debt owed would have nullified the concession agreement with the Teamsters, which could have resulted in a liquidity crisis that would have put the company into bankruptcy. Although the lenders had, and continue to have, a first priority interest in most of the assets of the company, a bankruptcy would have been complicated and likely would have resulted in a delay in recouping amounts owed to them, likely leaving participation in the out-of-court restructuring a better, but not ideal, option. Although the restructuring will result in modestly lower debt on YRCW's balance sheet, along with extended maturities and somewhat increased cash liquidity (assuming the lenders purchase the $100 million in new secured convertible notes), Fitch notes that YRCW will continue to face significant operational challenges and its post-restructuring leverage will remain high. Ultimately the company will need to strengthen its operational profile such that it can generate positive free cash flow on a sustainable basis. Until that time, the company will continue to run the risk of another liquidity crisis, and given that it has already undertaken essentially two out-of-court restructurings, it is likely that another liquidity squeeze would result in a bankruptcy. Fitch also notes that an adverse decision in the lawsuit brought against the company and the Teamsters by Arkansas Best Corporation still could force YRCW into a bankruptcy filing. It appears that a decision in that case will be reached in July 2011, around the time that the restructuring transaction is completed. From a credit perspective, the key piece of the restructuring transaction involves the exchange of new convertible preferred stock, which will automatically convert into new shares of common stock equal to a 72.5% ownership stake, and $140 million of new convertible secured notes in exchange for a $305 million reduction in outstanding principal, interest and fees owed on the company's secured credit facility (which consists of both a term loan and a revolving credit facility). YRCW estimates that as of June 30, 2011, prior to the closing of the restructuring transaction, there will be $247 million in principal outstanding on the term loan and $134 million in principal outstanding on the revolver, for a total of $381 million in credit facility debt outstanding. In addition, the company estimates that, as of June 30, 2011, it will owe the lenders $166 million in deferred interest and fees, bringing the total amount owed on the credit facility to $547 million. To facilitate the reduction in the amounts owed on the credit facility, YRCW will enter into an amended term loan with an estimated $242 million in principal outstanding (which equals the estimated $547 million owed to the banks at June 30, 2011, less $305 million). An estimated $483 million in outstanding letters of credit (LCs) issued against the existing revolver will remain in- place under the amended facility. The maturity of the amended credit agreement has been extended to March 31, 2015 from Aug. 17, 2012. The maturity of the $140 million in new convertible secured notes that will be issued to the banks also will be March 31, 2015. In addition to the new secured convertible notes that will be issued in exchange for a portion of the reduction in outstanding bank debt, YRCW also will offer the lenders the opportunity to purchase an additional $100 million in new secured convertible notes due March 31, 2015, proceeds of which will provide additional liquidity that the company may use at its discretion. In terms of the other debt currently outstanding on YRCW's balance sheet, there will be no changes to any of the company's convertible notes, including the 6% notes due 2014, the 3.375% notes due 2023 or the 5% notes due 2023. The agreement in principle signed in February 2011 included a provision that would have exchanged equity for the principle owed on the convertible notes, but this provision has not been included in the support agreement. The approximately $152 million secured note owed to certain of the multi-employer pension plans to which the company contributes will have its maturity extended to March 31, 2015, with accrued interest and fees deferred until maturity. Currently, the pension note requires full repayment over the course of 2011 and 2012. In addition, the approximately $235 million of borrowings and LCs outstanding on YRCW's existing asset backed securitization (ABS) facility will be refinanced with proceeds from a new asset backed loan (ABL) facility. In addition to the 72.5% of the company's post-restructuring equity that will be held by YRCW's lenders, an additional 25% ownership position will be granted to the company's Teamster- represented employees, leaving existing shareholders with a 2.5% ownership stake. All of these figures will be subject to dilution, however, from shares that could be granted as part of a new management incentive plan, as well as shares associated with both sets of new convertible notes. On top of their majority ownership position in the company, the lenders also will have the opportunity to nominate six members of the company's new nine member Board of Directors, with the other three directors consisting of two directors nominated by the Teamsters and the post-restructuring Chief Executive Officer. The rating of 'CCC/RR2' on the company's secured credit facility reflects its substantial collateral coverage and superior recovery prospects in the 70% to 90% range in a distressed scenario. On the other hand, the rating of 'C/RR6' on the company's unsecured convertible notes reflects Fitch's expectation that recoveries on those notes would be poor, in the 0% to 10% range in a distressed scenario. The low level of expected recovery for the unsecured debt is due to the substantial amount of higher-priority secured debt in the company's capital structure. YRC WORLDWIDE: CEO & CFO to Step Down After Restructuring --------------------------------------------------------- Bob Sechler, writing for MarketWatch, reports that YRC Worldwide Inc. Chief Executive William Zollars said Friday that both he and interim Chief Financial Officer William Trubeck likely will step down in late July, when the struggling trucking company aims to complete a financial restructuring. "I'm going to be here through the restructuring process" but will step down upon its completion, Mr. Zollars told analysts on a post-earnings conference call, according to MarketWatch. Mr. Zollars said Trubeck is operating within the same time frame. YRC last week unveiled details of a crucial financial overhaul that would dilute the ownership stakes of existing shareholders almost entirely. A senior executive called the plan "the best available alternative" after "a long, difficult struggle over the last two years." Shareholders will vote on the plan in late July. 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. The Company's balance sheet at Dec. 31, 2010, showed $2.63 billion in total assets, $2.73 billion in total liabilities and $95.84 million in total shareholders' deficit. KPMG LLP's audit reports on the consolidated financial statements of YRC Worldwide Inc. and subsidiaries for 2009 and 2010 each contain an explanatory paragraph that states that the Company has experienced significant declines in operations, cash flows and liquidity and these conditions raise substantial doubt about the Company's ability to continue as a going concern. * * * 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." As reported by the TCR on March 22, 2011, Moody's Investors Service has lowered the Corporate Family Rating of YRC Worldwide, Inc to Ca from Caa3. The rating outlook is negative. The rating has been downgraded in response to the company's recent disclosure of a "Milestone Failure" relating to requirements under its amended credit agreement. Moody's believes that this development increases the risk in YRC's efforts to conclude critical refinancing that is instrumental to its ability to avoid bankruptcy. As reported by the TCR on May 5, 2011, Fitch Ratings downgraded YRC's Issuer default rating to 'C' from 'CC'; Secured bank credit facility rating downgraded to 'CCC/RR2' from 'B-/RR2'; and Senior unsecured rating affirmed at 'C/RR6'. In addition, Fitch has removed YRCW's ratings from Rating Watch Negative. Fitch said that although it appears increasingly likely that the company will successfully complete the restructuring, until the transactions constituting the restructuring close, which is not anticipated until late July 2011, there exists a potential for the transaction to fail, in which case Fitch expects the company would be forced to file for Chapter 11 bankruptcy protection. * Coastal Bank's Closing Is 40th This Year ------------------------------------------ Coastal Bank, Cocoa Beach, Florida, was closed Friday by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Premier American Bank, National Association, Miami, Florida, to assume all of the deposits of Coastal Bank. As of March 31, 2011, Coastal Bank had approximately $129.4 million in total assets and $123.9 million in total deposits. In addition to assuming all of the deposits of the failed bank, Premier American Bank, N.A. agreed to purchase essentially all of the assets. The FDIC estimates that the cost to the Deposit Insurance Fund will be $13.4 million. Coastal Bank is the 40th FDIC-insured institution to fail in the nation this year, and the fifth in Florida. The last FDIC-insured institution closed in the state was Cortez Community Bank, Brooksville, on April 29, 2011. 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) ----------- ---------- -------------- ----------- Coastal Bank $129.4 Premier American Bank $13.4 Community Central $476.3 Talmer Bank & Trust $183.2 The Park Avenue Bank $953.3 Bank of the Ozarks $306.1 Cortez Community Bank $70.9 Florida Community Bank $18.6 First National Bank $352.0 Florida Community Bank $42.9 First Choice Community $308.5 Bank of the Ozarks $92.4 Heritage Banking $224.0 Trustmark National $49.1 Rosemount National $37.6 Central Bank $3.6 Nexity Bank $793.7 AloStar Bank of Commerce $175.4 New Horizons Bank $110.7 Citizens South Bank $30.9 Bartow County Bank $330.2 Hamilton State Bank $69.5 Superior Bank $3,000.0 Superior Bank, N.A. $259.6 Nevada Commerce Bank $144.9 City National Bank $31.9 Western Springs $186.8 Heartland Bank $31.0 Bank of Commerce $163.1 Advantage National $41.9 Legacy Bank $190.4 Seaway Bank and Trust $43.5 First Nat'l Bank of Davis $90.2 The Pauls Valley National $26.5 Valley Community Bank $123.8 First State Bank $22.8 Citizens Bank $214.3 Heritage Bank $59.4 San Luis Trust $332.6 First California $96.1 Habersham Bank $387.6 SCBT National $90.3 Charter Oak Bank $120.8 Bank of Marin $21.8 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 884 Banks in Problem List The FDIC said for all of 2010, mergers absorbed 197 institutions, while 157 insured commercial banks and savings institutions failed. This is the largest annual number of bank failures since 1992, when 181 institutions failed. The number of institutions on the FDIC's "Problem List" increased from 860 in the third quarter to 884 in the fourth quarter. There were 775 banks on the list at the end of the first quarter and 829 at June 30. Total assets of "problem" institutions increased from $379 billion at Sept. 30, 2010, to $390 billion at the end of the fourth quarter. The assets though are below the $403 billion reported at year-end 2009. FDIC Chairman Sheila C. Bair notes the rate of increase in the number of "problem" banks has declined in each of the past four quarters. Thirty insured institutions failed during the fourth quarter, bringing the total number of failures for the full year to 157. "As we have repeatedly stated, we believe that the number of failures peaked in 2010, and we expect both the number and total assets of this year's failures to be lower than last year's," added Bair. Problem Institutions Failed Institutions -------------------- ------------------- Year Number Assets (Mil) Number Assets (Mil) ---- ------ ------------ ------ ------------ 2010 884 $390,017 157 $92,085 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 Federal regulators assign a composite rating to each financial institution, based upon an evaluation of financial and operational criteria. The rating is based on a scale of 1 to 5 in ascending order of supervisory concern. "Problem" institutions are those institutions with financial, operational, or managerial weaknesses that threaten their continued financial viability. Depending upon the degree of risk and supervisory concern, they are rated either a "4" or "5." The number and assets of "problem" institutions are based on FDIC composite ratings. Prior to March 31, 2008, for institutions whose primary federal regulator was the OTS, the OTS composite rating was used. * April Bankruptcies Pull Back From March Increase -------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that, according to data from Epiq Systems Inc., bankruptcy filings in April totaled 129,700, representing a 3% decline from the daily rate in March and a 7% drop compared with April 2010. If the pace continues, 2011 would end up with 1.46 million total bankruptcies, or 6% fewer than the 1.56 million in 2010. April's 6,800 commercial bankruptcies were 16% less than in the same month in 2010. Bankruptcies are down in 48 states, with only Utah and New Jersey reporting more total bankruptcies this year when compared with the average rate in 2010. * * * Bankruptcy filings for the 12-month period ending March 31, 2011, rose 2.6% when compared to bankruptcy filings for the 12-month period ending March 31, 2010, according to statistics released Friday by the Administrative Office of the U.S. Courts. March 2011 bankruptcy filings totaled 1,571,183, with 1,531,997 bankruptcy cases filed in the 12-month period ending March 31, 2010. The majority of bankruptcy filings involve predominantly non- business debts. Non-business filings (also called personal or consumer filings) for the 12-month period ending March 31, 2011, totaled 1,516,971, up 3% from the 1,470,849 bankruptcies filed in the 12-month period ending March 31, 2010. Filings involving predominantly business debts fell. They totaled 54,212, down 11% from the 61,148 business bankruptcies filed in the 12-month period ending March 31, 2010. Second Quarter of FY 2011 The first three months of 2011 were the second quarter of the Judiciary's 2011 fiscal year. The number of bankruptcies filed during those three months was 366,178, down 6% from the 388,148 filings in the same quarter of 2010. Filings by Chapter For the 12-month period ending March 31, 2011, filings rose for chapters 7, 12, and 13, while chapter 11 filings fell, compared to the 12-month period ending March 31, 2010. -- Chapter 7 filings rose 2% to 1,118,481, compared to the 1,100,032 Chapter 7 filings in the 12-month period ending March 31, 2010. -- Chapter 13 filings rose 5% to 438,788 from the 415,966 bankruptcies filed in the 12-month period ending March 31, 2010. -- Chapter 11 filings fell 14% to 13,051 from the 15,251. Chapter 11 filings in the same time period in 2010. -- Chapter 12 filings rose 23% to 743, from the 605 filings for the 12-month period ending March 2010. A copy of the bankruptcy statistics is available at: http://is.gd/GmzuUi * S&P's Global Corporate Defaults Tally Has Five in 1st Quarter --------------------------------------------------------------- Globally, five companies -- four public and one confidentially rated -- defaulted in the first quarter of 2011, said an article published May 6 by Standard & Poor's Global Fixed Income Research, titled "Quarterly Default Update and Rating Transitions (Premium)." The volume of rated debt affected by defaulters in the first quarter was $3.62 billion, and the U.S. accounted for $3.41 billion (94%) of the total. Of the five defaults in first-quarter 2011, four were domiciled in the U.S., and one was based in the Czech Republic. For details about the defaults in the first quarter, see "First-Quarter 2011 Default Synopses (Premium)," also published May 6. Globally, credit market conditions continue to improve. The quarterly default rate for speculative-grade-rated corporate entities fell to 0.16% at the end of first-quarter 2011, compared with 0.59% in the fourth quarter of 2010 and 0.98% in first- quarter 2010. "On a trailing-12-month basis, the global speculative-grade default rate as of March 2011 was 2.1%, down from 8.4% at the same time this past year and a high of 10% in November 2009," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "The default rate is now at its lowest point since August 2008, the last reading prior to the collapse of Lehman Brothers and the ensuing recession in the U.S." Overall, credit quality has, in our view, continued to stabilize over the past 18 months, though the number of downgrades has increased slightly across all regions. The downgrade-to-upgrade ratio rose to 1.1% in first-quarter 2011 from 0.64% in the fourth quarter of 2010, but it's still close to the parity level of 1%. * BOND PRICING -- For Week From May 2 to 6, 2011 ------------------------------------------------ Company Coupon Maturity Bid Price ------- ------ -------- --------- 155 E TROPICANA 8.750 4/1/2012 5.000 AHERN RENTALS 9.250 8/15/2013 45.500 AMBAC INC 5.950 12/5/2035 12.538 AMBAC INC 6.150 2/7/2087 0.800 AMBAC INC 7.500 5/1/2023 15.350 AMBAC INC 9.500 2/15/2021 11.750 AMBASSADORS INTL 3.750 4/15/2027 43.520 APPLETON PAPERS 9.750 6/15/2014 77.250 BANK NEW ENGLAND 8.750 4/1/1999 13.500 BANK NEW ENGLAND 9.875 9/15/1999 13.750 BANKUNITED FINL 3.125 3/1/2034 6.750 BANKUNITED FINL 6.370 5/17/2012 5.500 CAPMARK FINL GRP 5.875 5/10/2012 56.625 CS FINANCING CO 10.000 3/15/2012 3.000 DOW-CALL05/11 5.050 5/15/2015 99.755 DOW-CALL05/11 5.650 5/15/2020 98.000 DUNE ENERGY INC 10.500 6/1/2012 75.000 EDDIE BAUER HLDG 5.250 4/1/2014 4.000 EVERGREEN SOLAR 4.000 7/15/2013 28.750 FAIRPOINT COMMUN 13.125 4/2/2018 1.250 FRANKLIN BANK 4.000 5/1/2027 5.490 GBX-CALL05/11 8.375 5/15/2015 102.890 GNW-CALL05/11 6.050 5/15/2023 99.254 GREAT ATLA & PAC 6.750 12/15/2012 26.000 GREAT ATLANTIC 9.125 12/15/2011 22.885 HARRY & DAVID OP 9.000 3/1/2013 24.000 KEYSTONE AUTO OP 9.750 11/1/2013 40.000 LEHMAN BROS HLDG 4.500 8/3/2011 23.750 LEHMAN BROS HLDG 4.700 3/6/2013 23.910 LEHMAN BROS HLDG 4.800 3/13/2014 25.160 LEHMAN BROS HLDG 5.000 2/11/2013 23.875 LEHMAN BROS HLDG 5.000 3/27/2013 24.750 LEHMAN BROS HLDG 5.000 8/5/2015 23.500 LEHMAN BROS HLDG 5.100 1/28/2013 23.375 LEHMAN BROS HLDG 5.150 2/4/2015 24.250 LEHMAN BROS HLDG 5.250 2/6/2012 24.550 LEHMAN BROS HLDG 5.250 2/11/2015 24.625 LEHMAN BROS HLDG 5.625 1/24/2013 24.601 LEHMAN BROS HLDG 5.750 5/17/2013 24.750 LEHMAN BROS HLDG 5.875 11/15/2017 23.625 LEHMAN BROS HLDG 6.000 4/1/2011 15.000 LEHMAN BROS HLDG 6.000 7/19/2012 24.500 LEHMAN BROS HLDG 6.000 6/26/2015 24.000 LEHMAN BROS HLDG 6.000 12/18/2015 24.250 LEHMAN BROS HLDG 6.625 1/18/2012 25.500 LEHMAN BROS HLDG 8.050 1/15/2019 24.250 LEHMAN BROS HLDG 8.500 8/1/2015 24.000 LEHMAN BROS HLDG 8.800 3/1/2015 24.500 LEHMAN BROS HLDG 8.920 2/16/2017 25.750 LEHMAN BROS HLDG 9.000 3/7/2023 23.625 LEHMAN BROS HLDG 9.500 12/28/2022 23.875 LEHMAN BROS HLDG 9.500 1/30/2023 24.000 LEHMAN BROS HLDG 9.500 2/27/2023 23.375 LEHMAN BROS HLDG 10.000 3/13/2023 24.000 LEHMAN BROS HLDG 10.375 5/24/2024 24.500 LEHMAN BROS HLDG 11.000 6/22/2022 24.500 LEHMAN BROS HLDG 11.000 7/18/2022 23.875 LEHMAN BROS HLDG 11.000 8/29/2022 24.375 LEHMAN BROS HLDG 11.000 3/17/2028 23.750 LEHMAN BROS HLDG 12.120 9/11/2009 5.390 LEHMAN BROS HLDG 22.650 9/11/2009 24.000 LEHMAN BROS INC 7.500 8/1/2026 14.000 LTX-CREDENCE 3.500 5/15/2011 95.333 MAJESTIC STAR 9.750 1/15/2011 20.125 MISBAP-CALL05/11 8.200 5/15/2025 98.277 MOHEGAN TRIBAL 8.375 7/1/2011 91.000 NEWPAGE CORP 10.000 5/1/2012 58.625 NEWPAGE CORP 12.000 5/1/2013 28.500 RASER TECH INC 8.000 4/1/2013 29.760 RESTAURANT CO 10.000 10/1/2013 13.000 RIVER ROCK ENT 9.750 11/1/2011 87.000 SBARRO INC 10.375 2/1/2015 20.550 TEXAS COMP/TCEH 7.000 3/15/2013 29.000 THORNBURG MTG 8.000 5/15/2013 4.010 TIMES MIRROR CO 7.250 3/1/2013 52.500 TOUSA INC 9.000 7/1/2010 13.500 TRANS-LUX CORP 8.250 3/1/2012 14.000 TRANS-LUX CORP 9.500 12/1/2012 15.250 TRICO MARINE 3.000 1/15/2027 4.750 VIRGIN RIVER CAS 9.000 1/15/2012 48.500 WASH MUT BANK FA 5.650 8/15/2014 0.270 WCI COMMUNITIES 7.875 10/1/2013 0.400 WCI COMMUNITIES 9.125 5/1/2012 3.700 WOLVERINE TUBE 15.000 3/31/2012 30.000 ********* 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/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. 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 ***