/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110524.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, May 24, 2011, Vol. 15, No. 142 Headlines 3PEA INTERNATIONAL: Reports $6,440 First Quarter Net Profit 15-35 HEMPSTEAD: Karen L. Gilman Appointed as Chapter 11 Trustee 207 REDWOOD: Disclosure Statement Hearing Reset for Aug. 24 ACCESS PHARMACEUTICALS: Incurs $1.9-Mil. Net Loss in First Quarter AGY HOLDING: Files Form 10-Q; Incurs $7.07MM Net Loss in Q1 AIROCARE INC: Timothy Hyland Withdrawn to Represent Young Parties ALANCO TECHNOLOGIES: Receives NASDAQ Listing Notification ALION SCIENCE: Incurs $9.7-Mil. First Quarter Net Loss AMBASSADORS INT'L: Wins Final Approval of $20-Mil. Financing AMBASSADORS INT'L: Sells Windstar Business to Xanterra Holding AMBASSADORS INT'L: Has Okay to Sell Windstar to Anschutz for $39MM AMERICAN NATURAL: Incurs $620,600 Net Loss in First Quarter AMERICAN PATRIOT: Incurs $281,900 Net Loss in First Quarter AMSCAN HOLDINGS: Incurs $2.49 Million First Quarter Net Loss ARETE INDUSTRIES: Posts $453,700 First Quarter Net Loss ASARCO LLC: Globe Plant to be Redeveloped ASARCO LLC: Ex-Worker Wins $870,000 in Sexual Harassment Case ATLANTIC SOUTHERN: Financials Delayed; Bank Has Capital Issues ATRINSIC, INC: Posts $3.5 Million First Quarter Net Loss BANKATLANTIC BANCORP: Files Supplements to $30MM Offering BANKS HOLDING: Court Denies Bid for Trustee or Ch. 7 Conversion BATAA/KIERLAND: Evidentiary Hearing on Cash Use Set for June 16 BERNARD L. MADOFF: Trustee Details Work on Bankruptcy Case BERNARD L. MADOFF: Trustee Defends $1-Bil. Suit vs. Mets Owners BERRY PLASTICS: Incurs $2 Million Net Loss in April 2 Quarter BIOLIFE SOLUTIONS: Incurs $630,100 Net Loss in First Quarter BIOVEST INTERNATIONAL: Reports $82,000 Net Income in March 31 Qtr. BLACK RAVEN: Incurs $945,000 First Quarter Net Loss BLOCKBUSTER CANADA: Chapter 15 Case Summary BORDERS GROUP: Has Approval for TIAA Lease Termination Pact BORDERS GROUP: Wins OK of MM 100 Lease Termination Pact BORDERS GROUP: Has Stipulation for Replacement LOC with Travelers BRIGHAM EXPLORATION: Amends Credit Agreement with BoA BRIGHAM EXPLORATION: Accelerating Drilling Operations BRIGHAM EXPLORATION: To Offer $250 Million Senior Notes Due 2019 CAESARS ENTERTAINMENT: Amends Senior Secured Credit Agreement CAPITOL CITY BANCSHARES: Reports $85,300 Net Income in Q1 2011 CAPMARK FINANCIAL: Seeks to Buy Tax Credit Loans From Affiliate CASCADES INC: S&P Affirms CCR at 'BB-'; Outlook Now Positive CHINA CENTURY: Receives Add'l Notice of NYSE Amex Non-Compliance CHINA RITAR: Receives Nasdaq Staff Deficiency Letter CHINA RUITAI: Reports $735,900 First Quarter Net Income CHINA VILLAGE: Can Access Cash Collateral to Pay Property Taxes CHRISTIAN BROTHERS: Schedules Filing Deadline Extended to June 13 CICERO INC: Incurs $435,000 Net Loss in First Quarter CIRTRAN CORP: Delays Filing of First Quarter Form 10-Q CLAIRE'S STORES: Expects $346-Mil. in Net Sales for First Quarter CLEAN BURN: Has Access to Cape Fear Cash Collateral Until June 5 CLEAN BURN: Taps Smith, Anderson, as Special Counsel CLEAN BURN: LREMC Seeks Unsecured Creditors' Committee Membership CLEAN DIESEL: Posts $2.3 Million First Quarter Net Loss COLONIAL BANCGROUP: Court Rejects Liquidation Plan COLUMBUS COUNTRY CLUB: Meeting of Creditors on June 12 COMPREHENSIVE CARE: Reports $41,000 First Quarter Net Income CONQUEST PETROLEUM: Delays Filing First Quarter Form 10-Q CONSTAR INT'L: Judge Approves Reorganization Plan CONSTAR INT'L: Wins Confirmation of Prepackaged Plan CORD BLOOD: Delays Filing of First Quarter Form 10-Q CORNERSTONE BANCSHARES: Files Form 10-Q; Posts $252,275 Income CP JFK LLC: Ch. 11 Trustee Can Sell Hotel Property for $13.8-Mil. CROWNE PLAZA: Lender Wants Dismissal or Ch. 11 Trustee CUMULUS MEDIA: Reports $16.1-Mil. First Quarter Net Income CUMULUS MEDIA: Prices $610 Million 7.75% Senior Notes Offering DBSD N.A.: Court Approves Disclosure Statement DEARBORN BANCORP: Reports $154,000 First Quarter Net Income DPAC TECHNOLOGIES: Posts $191,000 First Quarter Net Loss EASTERN LIVESTOCK: Lease Decision Deadline Extended to July 26 EASTMAN KODAK: 14 Directors Elected at Annual Meeting EAU TECHNOLOGIES: Incurs $700,830 First Quarter Net Loss ENEA SQUARE: Has Until June 15 to Use NUCP FUND's Cash Collateral EVERGREEN TRANS: Reorganization Case Converted to Liquidation EZENIA! INC: Incurs $784,000 Net Loss in March 31 Quarter FENTURA FINANCIAL: Files Form 10-Q; Posts $310,000 Q1 Net Income FIRST SECURITY: Incurs $2.65-Mil. First Quarter Net Loss FISHER ISLAND: Bond Not Filed to Support Involuntary GAS CITY: Has Continued Access to Bank of America Cash Collateral GENCORP INC: Moody's Upgrades Corporate Family Rating to 'B1' GENERAL MARITIME: OCM Marine Discloses 16.6% Equity Stake GREAT ATLANTIC: Section 341(a) Meeting Scheduled for May 31 GRUBB & ELLIS: Incurs $18.7-Mil. First Quarter Net Loss GULFSTREAM INT'L: Pilots Ratify Collective Bargaining Deal HAMPTON ROADS: Incurs $31.6-Mil. First Quarter Net Loss HARRISON TOWN: Moody's Lowers General Obligation Rating to 'Ba3' HARRY & DAVID: Files Joint Plan of Reorganization HEARUSA INC: Given Approval for $10 Million Financing HEARUSA INC: Gets Delisting Notices From NYSE Amex LLC HEATING OIL: No Notice of Bankruptcy No Defense on Stay Violation HERBST GAMING: Changes Name to Affinity Gaming HERCULES OFFSHORE: Appoints Craig Muirhead as VP and Treasurer HIGHLANDS OF LOS GATOS: U.S. Trustee Wants Case Converted to Ch. 7 HORIZON BANCORP: Lowers First Quarter Net Loss to $21,400 HUMBOLDT CREAMERY: Former CEO Hit With 2.5 Years for Fraud IMH FINANCIAL: Incurs $5.4-Mil. First Quarter Net Loss INNKEEPERS USA: Preferred Equity Receiving $3.5 Million INNOVATIVE FOOD: Reports $170,100 First Quarter Net Income INT'L AUTOMOTIVE: Moody's Assigns 'B1' Corporate Family Rating INT'L AUTOMOTIVE: S&P Gives 'B+' Corporate; Outlook is Stable INTERNATIONAL GARDEN: Has Until Aug. 1 to Propose Chapter 11 Plan INT'L LEASE: Moody's Assigns 'B1' Rating to Sr. Unsecured Notes INT'L LEASE: Fitch Expects to Rate $1B Unsecured Notes at 'BB' INT'L LEASE: S&P Hikes Rating on Unsecured Debt From 'BB+' INVENTIV HEALTH: S&P Puts 'B+' Corp. Credit Rating on Watch Neg. JAMES RIVER: Closes $475 Million Cash Acquisition of IRP KB GRADING: Equipment to be Liquidated at Lender-Owned Auction LEHMAN BROTHERS: Glenview Entities' $5.6-Mil. Claims Resolved LEHMAN BROTHERS: PIMCO Paid Premium Price on Lehman Stake LEVI STRAUSS: Names A. Rohosy as EVP and Pres. of Global Dockers LIBERTY MEDIA: Moody's Says Ratings Not Affected by Tender Offer LOWER BUCKS: Resumes Hyperbaric Medicine Services M&T BANK: DBRS Assigns 'BB' Rating to Perpetual Preferred Stock MAJESTIC CAPITAL: To Hire Michelman & Robinson as Special Counsel MARTIN CADILLAC: Chapter 11 Trustee Taps EisnerAmper as Accountant MEMC ELECTRONIC: S&P Assigns 'BB' Corporate Credit Rating MERCANTILE BANCORP: Shareholders Vote to Reelect Ted Awerkamp MERIT GROUP: Gets $55 Million in Financing From Lender MERITAGE HOMES: Fitch Affirms IDR at 'B+'; Outlook Stable MGM RESORTS: Amends WPIP on HKSE Common Stock Listing MICHAELS STORES: Tampering Probe Won't Affect Moody's Ratings MONEYGRAM INT'L: Amends From S-3 for $500-Mil. Offering MP-TECH AMERICA: Taps CBRE and AccuVal Associates as Appraisers MP-TECH AMERICA: Taps Burton & Armstrong as Bankruptcy Counsel MPG OFFICE: Caspian Capital Owns 8.6% of Preferred Shares MOHEGAN TRIBAL: Reports $24.7-Mil. Net Income in March 31 Qtr. NO FEAR RETAIL: Wants Until Aug. 23 to Propose Reorganization Plan NO FEAR RETAIL: Taps Venturi & Company as Financial Advisors NO FEAR RETAIL: Wants Until Sept. 22 to Accept and Reject Leases NORTH AMERICAN PETROLEUM: Amends Schedules of Assets and Debts NORTH AMERICAN PETROLEUM: Kinetic Advisors to Aid in Restructuring NORTH AMERICAN PETROLEUM: Pays Off Lender With Sale NORTHGATE CROSSING: Sec. 341 Creditors' Meeting on June 10 NOVADEL PHARMA: Posts $2.6 Million First Quarter Net Loss OIL STATES: Moody's Rates New 600-Mil. Senior Notes at 'Ba3' OIL STATES: S&P Gives 'BB' Corp. Credit Rating; Outlook Stable OK ETON: Hearing on Case Conversion Plea Continued Until July 5 OMNICOMM SYSTEMS: Posts $3.9-Mil. First Quarter Net Loss ORBITAL SCIENCE: Moody's Affirms 'Ba1' Corporate Family Rating PETROLEUM & FRANCHISE: Wants to Solicit Plan Votes Until July 29 PJ FINANCE: Torchlight Seeks to Terminate Right to Use Cash PLY GEM HOLDINGS: Incurs $70.9-Mil. Net Loss for April 2 Quarter POLI-GOLD LLC: Taps Keller Williams as Real Estate Listing Broker PONIARD PHARMA: Files Form 10-Q; Posts $3.2MM Net Loss in Q1 2011 POWER EFFICIENCY: Posts $870,700 First Quarter Net Loss PRM REALTY: Wants Until May 31 to Propose Reorganization Plan PROFESSIONAL VETERINARY: Plan Exclusivity Extended Until Aug. 15 PURADYN FILTER: Posts $326,400 First Quarter Net Loss REALTY EXECUTIVES: Owes $400,000 in Debt to Johnson Bank RIVER ISLAND: Wants to Sell Residential Property for $3,950,000 RQB RESORT: Wants to Get Goldman Sachs' Consent on Courses Deal SAN JOAQUIN: Fitch Affirms 'BB' Rating on $2.08B Revenue Bonds SATELITES MEXICANOS: Can Hire Rubio Villegas as Mexican Counsel SATELITES MEXICANOS: Has Court's Final Nod to Use Cash Collateral SAVANNA ENERGY: DBRS Assigns 'B' Issuer Rating SBARRO INC: In Talks With Mystery Buyer on Likely Buyout SCHUTT SPORTS: Has OK to Pay Trade Claims From $400T Escrow SCOVILL FASTENERS: Committee Taps Greenberg Traurig as Counsel SCOVILL FASTENERS: Taps Carl Marks as Financial Advisor SCOVILL FASTENERS: Has Until May 31 to File Statements & Schedules SCOVILL FASTENERS: Unsecured Creditors Want 4% Carveout From Sale SECUREALERT INC: Posts $2.5 Million Net Loss in March 31 Quarter SEDONA DEVELOPMENT: Disclosure Statement Hearing Tomorrow S.H. LEGGITT: Court Approves Finance Deal with Premium Assignment S.H. LEGGITT: Plan of Reorganization Wins Court Approval SHENGDATECH, INC.: Appeals Delisting Determination by NASDAQ SIGG SWITZERLAND: Class Suits, Declining Sales Cue Bankruptcy SIRIUS XM: To Settle "Carl Blessing" Lawsuit Pending in N.Y. SIZZLING PLATTER: S&P Assigns 'B-' Corporate Credit Rating SOUTH EDGE: Chapter 11 Trustee Sues JPMorgan, Focus SPANISH BROADCASTING: Reports $310,000 First Quarter Net Income SPANISH BROADCASTING: Caspian Owns 5.59% of Class A Common Stock SPECTRUM BRANDS: Moody's Upgrades CFR to 'B1'; Outlook Stable STATION CASINOS: GVR and Aliante Debtors File Schedules STATION CASINOS: U.S. Govt. Presents Issues on Appeal STATION CASINOS: GV Ranch Proposes to Hire FTI as Advisor STATION CASINOS: GV Ranch Wins OK for Kirkland as Counsel SUMMIT BUSINESS MEDIA: Exits Chapter 11 Via Pre-Arranged Plan SUN PRODUCTS: Moody's Downgrades Corporate Family Rating to 'B2' SUNSTATE EQUIPMENT: Moody's Puts Caa2 Rating on Sr. Secured Notes SUNSTATE EQUIPMENT: S&P Rates $170MM Second-Lien Notes at 'CCC+' SUPER FRESH: Village Super Market to Acquires Two Stores SUSSEX COUNTY: S&P Raises Ratings on Revenue Bonds From 'B/B' TENNECO INC: S&P Raises Corp. Rating to 'BB' on Strong Sales TEREX CORP: S&P Affirms 'BB-' Corp. Credit Rating; Outlook Stable TIB FINANCIAL: Files Form 10-Q; Posts $1.06MM Net Income in Q1 UNITED SECURITY: A.M. Best Lifts Fin'l Strength Rating to 'C-' US FOODSERVICE: S&P Assigns 'B' Corporate Credit Rating USG CORP: Four Directors Elected at Annual Meeting VALLEY ROAD: S&P Withdraws 'BB' Credit Rating After Debt Paydown VILICA LLC: Hires Coldwell Banker as Real Estate Broker VILICA LLC: Taps Weaverville Realty as Real Estate Broker WASHINGTON MUTUAL: Plan Confirmation Hearing Adjourned to June 29 WASHINGTON MUTUAL: Equity Committee Proposes BDO as Tax Advisor WEST END FINANCIAL: Consolidation Opposed by U.S. Trustee WILLIAM LYON: Incurs $136.78 Million Net Loss in 2010 WILLIAM LYON: Delays Filing of March 31 Form 10-Q WIZZARD SOFTWARE: Posts $606,800 First Quarter Net Loss WILLIAM SWITZER: Chapter 15 Case Summary WINDSOR FINANCING: S&P Rates $268.5-Million Bonds at 'B+' WINFREE ACADEMY: S&P Lowers Rating on $8.24MM Bonds to 'BB+' WORLDGATE COMMUNICATIONS: Posts $4.6 Million Net Loss in Q1 2011 W.R. GRACE: IDOR Says Claims Valid in Absence of Tax Returns W.R. GRACE: Registers 2,100,000 Shares for Stock Incentive Plan W.R. GRACE: Officers Disclose Acquisition of Common Stock * Liquidity, Covenant Problems Abating on Junk Debt * Inherited Home, IRA Remain Exempted Assets * Failure to Pay Taxes Alone Doesn't Prevent Discharge * Sullivan & Cromwell Settles Fee Fight With Ex-Partner * Large Companies With Insolvent Balance Sheets ********* 3PEA INTERNATIONAL: Reports $6,440 First Quarter Net Profit ----------------------------------------------------------- 3Pea International, Inc., filed its quarterly report on Form 10-Q, reporting net income of $6,442 on $937,569 of revenues for the three months ended March 31, 2011, compared with a net loss of $47,402 on $448,864 of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $3.2 million in total assets, $6.3 million in total liabilities, and a stockholders' deficit of $3.1 million. Sarna & Company, in Thousand Oaks, Calif., expressed substantial doubt about 3Pea International's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations. A complete text of the Form 10-Q is available for free at: http://is.gd/ZatXn5 Henderon, Nev.-based 3Pea International, Inc., is a payment solutions company which currently focuses on providing proprietary transaction processing solutions for healthcare and financial applications providing prepaid debit cards, which are also known as stored value cards (SVCs). 15-35 HEMPSTEAD: Karen L. Gilman Appointed as Chapter 11 Trustee ---------------------------------------------------------------- The Hon. Gloria M. Burns of the U.S. Bankruptcy Court for the District of New Jersey approved the appointment of: Karen L. Gilman, Esq. WOLFF & SAMSON PC The Offices at Crystal Lake One Boland Drive West Orange, NJ 07052 as Chapter 11 trustee of the estates of 15-35 Hempstead Properties, LLC, and Jackson 299 Hempstead, LLC. The trustee will monitor the amount of funds on hand and ensure that the bonds are set in an amount that is at least one and one- half times (150%) of the average monthly balance of funds on hand. Roberta A. DeAngelis, U.S. Trustee, Region 3, has has initially fixed the trustee's bond at $40,000 for 15-35 Hempstead and $10,000 for Jackson 299. On May 4, 2011, the Court approved the request to appoint a Chapter 11 trustee in the Debtors' cases. The U.S. Trustee is represented by: Martha R. Hildebrandt, Esq. Mitchell B. Hausman, Esq. One Newark Center, Suite 2100 Newark, NJ 07102 Tel: (973) 645-3014 Fax: (973) 645-5993 About 15-35 Hempstead Properties 15-35 Hempstead Properties, LLC, owns real property at 101 Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10-43178) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, assists 15-35 Hempstead in its restructuring effort. 15-35 Hempstead estimated its assets and debts at $10 million to $50 million. Affiliate Jackson 299 Hempstead, LLC, owns a parcel of real property at 101 Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10- 43180) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, assists Jackson 299 in its restructuring effort. The Debtors tapped Beverly Cox as its bookkeeper, and Landis Company, LLC, as its real estate broker. Jackson 299 estimated its assets and debts at $10 million to $50 million. The cases are jointly administered under 15-35 Hempstead Properties, LLC. Karen L. Gilman, Esq. as Chapter 11 Trustee of the Debtors' estate tapped Wolff & Samson PC as its attorney. 207 REDWOOD: Disclosure Statement Hearing Reset for Aug. 24 ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Maryland has rescheduled to August 24, 2011, at 10:00 a.m., the hearing to consider adequacy of the Disclosure Statement explaining 207 Redwood LLC's proposed Plan of Reorganization. The hearing was previously set for Aug. 17. At the hearing, the Court will also consider the objection to the Disclosure Statement filed on behalf of RL BB Financial, LLC. As reported in the March 17, 2011 edition of the Troubled Company Reporter, under the Plan, holders of interests in the Debtor will not receive or retain anything on account of their Interests, and their Interests will be canceled and extinguished as of the Effective Date. The Debtor's largest secured creditor, RL BB Financial, will be paid 100% of its allowed Secured Claim over time. Harbor Hotel Developers LLC, as the New Investor, will acquire the equity interests of the Reorganized Debtor in consideration for funding the Plan and will make all distributions under the Plan. All property of the Debtor's Estate not otherwise specifically treated under the Plan will become Reorganized Debtor's property. Claims held by the Debtor's creditors will be paid from (a) income generated by the Reorganized Debtor or (b) additional capital provided by the New Investor. Moreover, funds needed to finish renovations of the Property and to operate the Property will be paid by the New Investor. A full-text copy of the Disclosure Statement is available at no charge at http://bankrupt.com/misc/207REDWOOD_DS.pdf About 207 Redwood Columbia, Maryland-based 207 Redwood LLC filed for Chapter 11 protection (Bankr. D. Md. Case No. 10-27968) on Aug. 6, 2010. James A. Vidmar, Jr., Esq., and Lisa Yonka Stevens, Esq., at Logan, Yumkas, Vidmar & Sweeney LLC, in Annapolis, Md., assist the Debtor in its restructuring effort. In its amended schedules, the Debtor disclosed $14,500,000 in assets and $24,097,109 in liabilities as of the Petition Date. ACCESS PHARMACEUTICALS: Incurs $1.9-Mil. Net Loss in First Quarter ------------------------------------------------------------------ Access Pharmaceuticals, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $1.90 million on $150,000 of total revenues for the three months ended March 31, 2011, compared with net income of $1.09 million on $102,000 of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $6.87 million in total assets, $29.58 million in total liabilities, and a $22.70 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/TsXf0O About Access Pharmaceuticals Access Pharmaceuticals, Inc., is an emerging biopharmaceutical company focused on developing pharmaceutical products primarily based upon its nano-polymer chemistry technologies and other drug delivery technologies. The Company currently has one approved product, one product candidate at Phase 3 of clinical development, three product candidates in Phase 2 of clinical development and other product candidates in pre-clinical development. The Company reported a net loss of $7.54 million on $481,000 of revenue for the year ended Dec. 31, 2010, compared with a net loss of $17.34 million on $352,000 of revenue during the prior year. As reported by the TCR on April 5, 2011, Whitley Penn LLP, in Dallas, Texas, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2010 results. The independent auditors noted that the Company has had recurring losses from operations, negative cash flows from operating activities and has an accumulated deficit. AGY HOLDING: Files Form 10-Q; Incurs $7.07MM Net Loss in Q1 ----------------------------------------------------------- AGY Holding Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $7.07 million on $44.93 million of net sales for the three months ended March 31, 2011, compared with a net loss of $5.06 million on $45.57 million of net sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $304.81 million in total assets, $285.99 million in total liabilities, $1.78 million in obligation under put/call for non-controlling interest and $17.03 million in total shareholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/JEilwu About AGY Holding AGY Holding Corp. -- http://www.agy.com/-- produces fiberglass yarns and high-strength fiberglass reinforcements used in composites applications. AGY serves a range of markets including aerospace, defense, electronics, construction and industrial. Headquartered in Aiken, South Carolina, AGY has a European office in Lyon, France and manufacturing facilities in the U.S. in Aiken, South Carolina and Huntingdon, Pennsylvania and a controlling interest in a manufacturing facility in Shanghai, China. The Company reported a net loss of $14.57 million on $183.67 million of net sales for the year ended Dec. 31, 2010, compared with a net loss of $93.51 million on $153.85 million of net sales during the prior year. * * * AGY Holding carries a 'CCC+' corporate credit rating from Standard & Poor's Ratings Services. In December 2009, S&P lowered the rating to 'CCC+' from 'B'. "The downgrade follows S&P's ongoing concern on operating performance, including S&P's expectation for very weak credit metrics for 2009, weak liquidity relative to interest payments and operating requirements in 2010, and integration concerns related to the large $72 million acquisition -- with a $20 million cash component -- of AGY Hong Kong Ltd.," said Standard & Poor's credit analyst Paul Kurias. AIROCARE INC: Timothy Hyland Withdrawn to Represent Young Parties ----------------------------------------------------------------- The Hon. Robert G. Mayer of the Bankruptcy Court for the Eastern District of Virginia informed AirOcare, Inc., that Timothy B. Hyland, Esq. at Stein, Sperling, Bennett, De Jong Driscoll & Greenfeig, P.C., is no longer representing Eric B. Young, M.D., Joyce D.C. Young and EBY Family, LLC. The Young parties are holders of allowed unsecured claims in the Debtor's case. Mr. Hyland related that the Young parties no longer need counsel of record in the Debtor's case and that the Young parties consented to Mr. Hyland's motion. About AirOcare, Inc. Dulles, Virginia-based AirOcare, Inc., was originally for the purpose of purchasing and developing technologies for air purification. AirOcare filed for Chapter 11 bankruptcy protection (Bankr. E.D. Va. Case No. 10-14519) on May 29, 2010. Frederick W. H. Carter, Esq., at Venable LLP, in Washington, D.C.; Kristen E. Burgers, Esq., and Lawrence Allen Katz, Esq., at Venable LLP, in Vienna, Va.; and Stephen E. Leach, Esq., at Leach Travell Britt, PC, in McLean, Va., assist the Debtor in its restructuring effort. The Debtor also tapped McGinn Intellectual Property Group PLLC for intellectual property matters. Indianapolis-based Wooden & McGlaughlin LLP represents the Debtor in the lawsuit filed by Key Electronics. The Company disclosed $21,360,578 in assets and $7,973,914 in debts as of the Petition Date. The effective date of the Debtor's Chapter 11 plan occurred on April 14, 2011. The Court entered its order confirming the Plan on April 13. ALANCO TECHNOLOGIES: Receives NASDAQ Listing Notification --------------------------------------------------------- Alanco Technologies, Inc. has received notice from the Staff of The NASDAQ Stock Market LLC that following Alanco's sale of its subsidiary, StarTrak Systems, LLC, to ORBCOMM Inc. ORBC -0.99% , the Staff has concluded that the Company is no longer eligible for continued listing on The NASDAQ Stock Market. The Staff made its determination based on the discretionary authority afforded to NASDAQ under Listing Rule 5101. In reaching its conclusion, the Staff noted that the Company "no longer has any operating business" following the sale of StarTrak. Therefore, notwithstanding the fact that Alanco meets all quantitative requirements for continued listing, the Staff advised Alanco that it would be subject to delisting unless it requests a hearing before a NASDAQ Listing Qualifications Panel. Accordingly, the Company has requested a hearing before the Panel. Alanco's common stock will remain listed on NASDAQ pending the issuance of a decision by the Panel following the hearing. However, there can be no assurance that the Panel will grant Alanco's request for continued listing following the hearing. As noted by Alanco in the May 16, 2011 press release announcing the sale of StarTrak, the Company is actively pursuing new opportunities to enhance shareholder value by leveraging its assets through a strategic merger or acquisition. ALION SCIENCE: Incurs $9.7-Mil. First Quarter Net Loss ------------------------------------------------------ Alion Science and Technology Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $9.66 million on $202.55 million of contract revenue for the three months ended March 31, 2011, compared with net income of $9.16 million on $203.54 million of contract revenue for the same period during the prior year. The Company also reported a net loss of $20.80 million on $403.32 million of contract revenue for the six months ended March 31, 2011, compared with net income of $1.22 million on $409.28 million of contract revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $639.23 million in total assets, $731.23 million in total liabilities, $157.26 million in redeemable common stock, $20.78 million in common stock warrants, $177,000 in accumulated other comprehensive loss, and a $269.87 million accumulated deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/XMgNyg About Alion Science Alion Science and Technology Corporation, based in McLean, Virginia, is an employee-owned company that provides scientific research, development, and engineering services related to national defense, homeland security, and energy and environmental analysis. Particular areas of expertise include communications, wireless technology, netcentric warfare, modeling and simulation, chemical and biological warfare, program management. Alion Science reported a net loss of $15.23 million on $833.98 million of contract revenue for the year ended Sept. 30, 2010, compared with a net loss of $17.04 million on $802.22 million of contract revenue during the prior year. * * * Alion carries 'Caa3' corporate family and probability of default Ratings, with stable outlook, from Moody's. Alion carries a 'B-' corporate credit rating, with stable outlook, from Standard & Poor's. Moody's said in March 2010 "The Caa1 corporate family rating would balance the continued high leverage against a promising business backlog that could sustain the good 2009 revenue growth rate, though credit challenges would remain pronounced." AMBASSADORS INT'L: Wins Final Approval of $20-Mil. Financing ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized, on a final basis, Ambassadors International Inc., et al., to obtain secured postpetition financing from Law Debenture Trust Company of New York, as administrative agent and collateral agent. The financing consist of a senior secured, superpriority, multiple draw, non-amortizing term loan facility in the aggregate principal amount of up to $20,000,000. The Court also ordered that no more than $75,000 of the proceeds of the New Money DIP facility, DIP Collateral, may be used by the Official Committee of Unsecured Creditors to investigate the prepetition liens or claims of the prepetition secured parties against the Debtors. The Debtors are also authorized to access the cash collateral of the prepetition agent, the prepetition working capital facility lenders, the second lien trustee and the second lien noteholders. Whippoorwill Associates, Inc., is the Debtors' prepetition working capital facility lender. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the DIP secured parties automatically perfected security interests in and liens on all of the DIP collateral, and superpriority administrative expense claims, subject to carve out. About Ambassadors International Headquarters in Seattle, Washington, Ambassadors International, Inc. (NASDAQ: AMIE) -- http://www.ambassadors.com/-- operates Windstar Cruises, a three-ship fleet of luxury yachts that explore the hidden harbors and secluded coves of the world's most sought- after destinations. Carrying 148 to 312 guests, the luxurious ships of Windstar cruise to nearly 50 nations, calling at 100 ports throughout Europe, the Caribbean and the Americas. Ambassadors International Inc. and 11 affiliates sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11002) on April 1, 2011. Kristopher M. Hansen, Esq.; Sayan Bhattacharyya, Esq.; Marianne Mortimer, Esq.; and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, serve as the Debtors' bankruptcy counsel. Imperial Capital, LLC, is the Debtors' financial advisor. Phase Eleven Consultants, LLC, is the Debtors' claims and notice agent. The Debtors tapped Bifferato Gentilotti LLC as Delaware counsel, and Richards, Layton & Finger as bankruptcy co-counsel. The Official Committee of Unsecured Creditors tapped Kelley Drye & Warren LLP as its counsel, and Lowenstein Sandler PC as its co-counsel. The Debtors disclosed $86.4 million in total assets and $87.3 million in total debts as of Dec. 31, 2010. AMBASSADORS INT'L: Sells Windstar Business to Xanterra Holding -------------------------------------------------------------- Ambassadors International, Inc., disclosed May 20 that the U.S. Bankruptcy Court for the District of Delaware has granted an order approving the sale of substantially all of Ambassadors' assets, including its principal operating unit, Windstar Cruises, to TAC Cruise LLC, an affiliate of Xanterra Holding Corporation. The sale is expected to close next week, according to the May 20 press release. All of Windstar's luxury yachts are sailing as scheduled, serving customers and guests with a high level of attention to their travel experience. During a court-supervised competitive bidding process in compliance with Section 363 of the U.S. Bankruptcy Code, TAC Cruise LLC submitted a winning bid of $39 million in cash. Windstar will be operated as a wholly-owned subsidiary of Xanterra Holding Corporation of Greenwood Village, CO. Xanterra Holding Corporation and its affiliates have operated in the hospitality and leisure industry for more than 100 years. "Windstar emerged as a tremendous long-term opportunity due to the line's exceptional product, loyal following and high level of guest satisfaction in the luxury travel market," said Andrew N. Todd, CEO of Xanterra Holding Corporation. "Xanterra intends to maintain Windstar's business and operations and to invest in Windstar's growth following the close of the sale." Hans Birkholz, CEO of Ambassadors and Windstar, said, "Windstar is very pleased with the successful outcome of this sale process and expects to complete it by early next week. Windstar is excited to have its new owner join in building Windstar's world class brand. Windstar will be well-positioned for long-term profitability and success under new ownership and we will continue to provide exceptional service and extraordinary luxury travel experiences for our guests." It is expected that Ambassadors' stockholders and holders of Ambassadors' convertible notes will not receive any distribution following the sale and these securities will likely have little, if any, value following Ambassadors' Chapter 11 proceeding. About Ambassadors International Headquarters in Seattle, Washington, Ambassadors International, Inc. (NASDAQ: AMIE) -- http://www.ambassadors.com/-- operates Windstar Cruises, a three-ship fleet of luxury yachts that explore the hidden harbors and secluded coves of the world's most sought- after destinations. Carrying 148 to 312 guests, the luxurious ships of Windstar cruise to nearly 50 nations, calling at 100 ports throughout Europe, the Caribbean and the Americas. Ambassadors International Inc. and 11 affiliates sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11002) on April 1, 2011. Kristopher M. Hansen, Esq.; Sayan Bhattacharyya, Esq.; Marianne Mortimer, Esq.; and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, serve as the Debtors' bankruptcy counsel. Imperial Capital, LLC, is the Debtors' financial advisor. Phase Eleven Consultants, LLC, is the Debtors' claims and notice agent. The Debtors tapped Bifferato Gentilotti LLC as Delaware counsel, and Richards, Layton & Finger as bankruptcy co-counsel. The Official Committee of Unsecured Creditors tapped Kelley Drye & Warren LLP as its counsel, and Lowenstein Sandler PC as its co-counsel. The Debtors disclosed $86.4 million in total assets and $87.3 million in total debts as of Dec. 31, 2010. AMBASSADORS INT'L: Has Okay to Sell Windstar to Anschutz for $39MM ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Windstar Cruises went through an all-day contested hearing on May 18 and was given tentative approval by the bankruptcy judge to sell the business for $39 million in cash to a subsidiary of Anschutz Corp. Anschutz won the auction where the first bid came from Whippoorwill Associates Inc. The holder of first- and second- lien debt, Whippoorwill was offering to take ownership in exchange for about $40 million in debt, including $10 million promised for the Chapter 11 case. Mr. Rochelle notes that the official creditors' committee objected to the sale, contending that Whippoorwill controlled Windstar, manipulated an otherwise unnecessary Chapter 11 filing, and arranged the sale so the price would be enough to cover the debt it was owed plus counsel fees, "but not a dollar more." About Ambassadors International Headquarters in Seattle, Washington, Ambassadors International, Inc. (NASDAQ: AMIE) -- http://www.ambassadors.com/-- operates Windstar Cruises, a three-ship fleet of luxury yachts that explore the hidden harbors and secluded coves of the world's most sought- after destinations. Carrying 148 to 312 guests, the luxurious ships of Windstar cruise to nearly 50 nations, calling at 100 ports throughout Europe, the Caribbean and the Americas. Ambassadors International Inc. and 11 affiliates sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11002) on April 1, 2011. Kristopher M. Hansen, Esq.; Sayan Bhattacharyya, Esq.; Marianne Mortimer, Esq.; and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, serve as the Debtors' bankruptcy counsel. Attorneys at Richards, Layton & Finger, P.A., serve as co-counsel. Imperial Capital, LLC, is the Debtors' financial advisor. Phase Eleven Consultants, LLC, is the Debtors' claims and notice agent. Attorneys at Lowenstein Sandler PC and Bifferato Gentilotti LLC represent the Official Committee of Unsecured Creditors. The Debtors disclosed $86.4 million in total assets and $87.3 million in total debts as of Dec. 31, 2010. AMERICAN NATURAL: Incurs $620,600 Net Loss in First Quarter ----------------------------------------------------------- American Natural Energy Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $620,649 on $663,671 of revenue for the three months ended March 31, 2011, compared with a net loss of $645,398 on $904,592 of revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $17.11 million in total assets, $9.42 million in total liabilities, and $7.69 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/tEo4Bq About American Natural American Natural Energy Corporation (TSX Venture: ANR.U) is a Tulsa, Oklahoma-based independent exploration and production company with operations in St. Charles Parish, Louisiana. The Company reported a net loss of $2.06 million on $2.57 million of revenue for the year ended Dec. 31, 2010, compared with net income of $23.95 million on $1.08 million of revenue during the prior year. As reported by the TCR on April 5, 2011, MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company incurred a net loss in 2010 and has a working capital deficiency and an accumulated deficit at Dec. 31, 2010. AMERICAN PATRIOT: Incurs $281,900 Net Loss in First Quarter ----------------------------------------------------------- American Patriot Financial Group, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $281,885 on $989,785 of total interest and dividend income for the three months ended March 31, 2011, compared with a net loss of $1.09 million on $1.37 million of total interest and dividend income for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $98.07 million in total assets, $96.21 million in total liabilities, and $1.86 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/8kFXzn About American Patriot Based in Greenville, Tenn., American Patriot Financial Group, Inc. is a one-bank holding company formed as a Tennessee corporation to own the shares of American Patriot Bank. The Bank is the only subsidiary of the Corporation. American Patriot Bank commenced operations as a state chartered bank on July 9, 2001. The Bank had total assets of roughly $118 million at Dec. 31, 2009. The Bank is not a member of the Federal Reserve System. The Bank's customer base consists primarily of small to medium- sized business retailers, manufacturers, distributors, land developers, contractors, professionals, service businesses and local residents. On Aug. 18, 2010, the Company received from the Federal Deposit Insurance Corporation, a Supervisory Prompt Corrective Action Directive, dated August 17, 2010, due to American Patriot Bank's "significantly undercapitalized" status. The Directive requires that the Bank submit an acceptable capital restoration plan on or before August 31, 2010, providing that, among other things, at a minimum, the Bank will restore and maintain its capital to the level of "adequately capitalized." The Company reported a net loss of $2.29 million on $5.04 million of total interest and dividend income for the year ended Dec. 31, 2010, compared with a net loss of $4.02 million on $6.23 million of total interest and dividend income during the prior year. As reported by the TCR on April 6, 2011, Hazlett, Lewis & Bieter, PLLC, in Chattanooga, Tennessee, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses for the past four years resulting in a retained deficit of $5,946,761. At Dec. 31, 2010, the Company and its subsidiary were significantly undercapitalized based on regulatory standards and has consented to an Order to Cease and Desist with its primary federal regulator that requires, among other provisions, that it achieve regulatory capital thresholds that are significantly in excess of its current actual capital levels. The Company's nonperforming assets have increased significantly during 2010 and 2009 related primarily to deterioration in the credit quality of its loans collateralized by real estate. The Company, at the holding company level, has a note payable that was due Feb. 28, 2011; however, the Company does not currently have sufficient funds to pay off this note and it is uncertain whether the lender will renew the note, or whether the Company can raise sufficient capital to pay off the note. This note is securitized by 100% of the stock of the subsidiary. AMSCAN HOLDINGS: Incurs $2.49 Million First Quarter Net Loss ------------------------------------------------------------ Amscan Holdings, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $2.49 million on $356.18 million of total revenues for the three months ended March 31, 2011, compared with a net loss of $369,000 on $308.22 million of total revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.70 billion in total assets, $1.41 billion in total liabilities, $33.17 million in redeemable common securities and $258.45 million total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/48JdNC About Amscan Holdings Based in Road Elmsford, New York, Amscan Holdings, Inc., designs, manufactures, contracts for manufacture and distributes party goods, including paper and plastic tableware, metallic balloons, accessories, novelties, gifts and stationery. The Company also operates retail party goods and social expressions supply stores in the United States under the names Party City, Party America, The Paper Factory, Halloween USA and Factory Card & Party Outlet, and franchises both individual stores and franchise areas throughout the United States and Puerto Rico principally under the names Party City and Party America. The Company is a wholly owned subsidiary of AAH Holdings Corporation. * * * Amscan Holdings carries Standard & Poor's Ratings Services' 'B' corporate credit rating, and Moody's Investors Service's 'B2' Corporate Family and Probability of Default Ratings. As reported in the TCR on Nov. 23, 2010, S&P affirmed the 'B' rating after the Company stated that it will use the proceeds from the proposed term loan facility to pay a roughly $310 million special dividend to its equity sponsors and repay borrowings under its existing term loan facility ($342 million outstanding as of Sept. 30, 2010). "The affirmation of Amscan's credit ratings reflect S&P's view that, following payment of its debt-financed dividend payment to its equity sponsors," said Standard & Poor's credit analyst Linda Phelps, "it will have a highly leveraged financial risk profile and its financial policy has become more aggressive." ARETE INDUSTRIES: Posts $453,700 First Quarter Net Loss ------------------------------------------------------- Arete Industries, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $453,678 on $29,656 of oil & gas revenue for the three months ended March 31, 2011, compared with a net loss of $213,967 on $58,393 of oil & gas revenue for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.2 million in total assets, $3.5 million in total liabilities, all current, and a stockholders' deficit of $2.3 million. Ronald R. Chadwick, P.C., of Aurora, Colo., expressed substantial doubt about Arete Industries' ability to continue as a going concern, following the Company's 2010 results. Mr. Chadwick noted that the Company has suffered recurring losses from operations, has a working capital deficit and a stockholders' deficit, and is delinquent on the payment of creditor liabilities including payroll taxes. A complete text of the Form 10-Q is available for free at: http://is.gd/1TEOWz Westminster, Colo.-based Arete Industries, Inc. (OTC QB: ARETD) -- http://www.areteindustries.com/-- is the operator of a gas gathering system and is in the process of buying oil and gas properties in the Rocky Mountain Region of the United States. ASARCO LLC: Globe Plant to be Redeveloped ----------------------------------------- The Denver City Council and Adams County commissioners have approved a collaborative effort to remediate and eventually redevelop the heavily polluted Globe Plant smelter site, the Denver Business Journal reported. The former ASARCO plant is on 77 acres at 51st and Washington streets in the Globeville neighborhood, which property is about 80% in Adams County and the rest is in Denver. According to the report, the agreement, which also involves the Denver Urban Renewal Authority, creates the first multi-county urban renewal area in Colorado that will be known as the Globeville Commercial Redevelopment Area. Remediation is expected to take three years and cost about $22 million. In another development, The Denver Post, citing attorneys who represented residents, reported that some south Globeville residents are receiving an additional $126,484 total from ASARCO for contaminating their properties with arsenic and other pollutants. The payment is part of a $13.3 million settlement reached with ASARCO in the late 1990s. South Globeville residents filed a class action lawsuit against ASARCO after high levels of contamination were found on their properties, which chemicals were released from ASARCO's Globe Plant smelting facility, the Denver Post recounted. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On Dec. 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. ASARCO LLC: Ex-Worker Wins $870,000 in Sexual Harassment Case ------------------------------------------------------------- Angela Aguilar, a former worker at ASARCO LLC's Mission Mine in Sahuarita, Arizona, has been awarded nearly $870,000 in a sexual harassment case against the company, The Associated Press reports. According to AP, a U.S. District Court jury found that ASARCO failed to stop a supervisor from sexually harassing Ms. Aguilar despite her complaints to management. The Arizona Daily Star reported that after an eight-day trial, the jury found in favor of Ms. Aguilar on the sexual harassment claim and awarded her $868,750 in punitive damages and $1 in nominal damages. The Office of the Arizona Attorney General joined the suit after Ms. Aguilar brought the action in March 2008. ASARCO officials complained that the award is excessive and noted of their plans to file paperwork to have the award vacated. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On Dec. 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. ATLANTIC SOUTHERN: Financials Delayed; Bank Has Capital Issues -------------------------------------------------------------- Atlantic Southern Financial Group, Inc., notified the U.S. Securities and Exchange Commission that it is unable to file its Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, by May 16, 2011, without unreasonable effort and expense. Further, the Company expects that it will not be able to file the Form 10-Q within the five-day extension permitted by the rules of the Securities and Exchange Commission. As previously discussed in the Notification of Late Filing on Form 12b-25 filed by the Company on April 1, 2011, due to significant and unprecedented deterioration in economic conditions during 2010 and into 2011, particularly weakened conditions in the housing and real estate markets, including falling real estate prices, increasing foreclosures, and rising unemployment, the Company has experienced dramatic increase in its non-performing assets and a significant decrease in its earnings and capital, which in turn contributed to delays in the preparation of the Company's financial statements for the year ended Dec. 31, 2010, and the quarter ended March 31, 2011. This process has required more time due to resource constraints and regulatory and capital issues of the Company's wholly-owned subsidiary, Atlantic Southern Bank. About Atlantic Southern Macon, Ga.-based Atlantic Southern Financial Group, Inc. (NASDAQ: ASFN) operates nine banking locations in the middle Georgia markets of Macon and Warner Robins, five locations in the coastal markets of Savannah, Darien, Brunswick, one location in the south Georgia market of Valdosta, Georgia and one location in the northeast Florida market of Jacksonville, Florida. The Company specializes in commercial real estate and small business lending. The Company's balance sheet at Sept. 30, 2010, showed $852.6 million in total assets, $832.4 million in total liabilities, and stockholders' equity of $20.2 million. "As a result of the extraordinary effects of what may ultimately be the worst economic downturn since the Great Depression, the Company's and the Bank's capital have been significantly depleted," the Company said in its Form 10-Q for the quarter ended Sept. 30, 2010. The Company recorded a net loss of $59.2 million in 2009, and a net loss of $9.3 million in the first nine months of 2010. The Company's ability to raise additional capital will depend on conditions in the capital markets at that time, which are outside its control, and on its financial performance. Accordingly, the Company cannot be certain of its ability to raise additional capital on terms acceptable to them. The Company's inability to raise capital or comply with the terms of the Order [to Cease and Desist] raises substantial doubt about its ability to continue as a going concern." On Sept. 11, 2009, the Company's wholly-owned subsidiary bank, Atlantic Southern Bank, entered into a Stipulation and Consent to the Issuance of an Order to Cease and Desist with the Federal Deposit Insurance Corporation and the Georgia Department of Banking and Finance, whereby the Bank consented to the issuance of an Order to Cease and Desist. ATRINSIC, INC: Posts $3.5 Million First Quarter Net Loss -------------------------------------------------------- Atrinsic, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $3.51 million on $7.06 million of revenue for the three months ended March 31, 2011, compared with a net loss of $3.43 million on $12.20 million of revenue for the same period last year. The Company's balance sheet at March 31, 2011, showed $15.47 million in total assets, $10.54 million in total liabilities, and stockholders' equity of $4.93 million. As reported in the TCR on Apr 12, 2011, KPMG LLP, in New York, expressed substantial doubt about Atrinsic's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations. A complete text of the Form 10-q is available for free at: http://is.gd/jQNbPL New York City-based Atrinsic, Inc. (NASDAQ: ATRN) -- is a marketer of direct-to-consumer subscription products and an Internet search-marketing agency. The Company sells entertainment and lifestyle subscription products directly to consumers, which the Company markets through the Internet. The Company also sells Internet marketing services to its corporate and advertising clients. BANKATLANTIC BANCORP: Files Supplements to $30MM Offering --------------------------------------------------------- BankAtlantic Bancorp, Inc., on May 16, 2011, filed with the Securities and Exchange Commission a prospectus supplement and accompanying base prospectus relating to the Company's previously announced rights offering of up to $30,000,000 of its Class A Common Stock. Beginning on May 18, 2011, the Prospectus will be distributed to the Company's shareholders of record as of the close of business on May 12, 2011. The Prospectus forms a part of the Company's Registration Statement on Form S-3 which was filed with the SEC on Feb. 12, 2010, and declared effective by the SEC on May 4, 2010. The Company is filing these exhibits as supplements to the Registration Statement: (a) Form of Subscription Rights Certificate http://is.gd/heIbT8 (b) Opinion of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. http://is.gd/CUupNr (c) Instructions for Use of BankAtlantic Bancorp, Inc. Subscription Rights Certificates http://is.gd/ABsAdm (d) Notice of Guaranteed Delivery for Subscription Rights Certificates Issued by BankAtlantic Bancorp, Inc. http://is.gd/c3CIMA (e) Letter to Shareholders http://is.gd/XVXOtZ (f) Letter to Securities Dealers, Commercial Banks, Trust Companies and Other Nominees http://is.gd/VA7Fi9 (g) Form of Letter to Clients of Nominee Holders http://is.gd/95Yv02 (h) Nominee Holder Certification Form http://is.gd/RqS6KV (i) Beneficial Owner Election Form http://is.gd/elB9JO 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. BANKS HOLDING: Court Denies Bid for Trustee or Ch. 7 Conversion --------------------------------------------------------------- Judge George R. Hodges declined an invitation by Linda W. Simpson, the Bankruptcy Administrator for the Western District of North Carolina, to appoint a Chapter 11 Trustee for Banks Holding Company L.P. or to convert the Debtor's case to Chapter 7 liquidation. Judge Hodges, however, added that his order is without prejudice to the right of the Bankruptcy Administrator to renew the request at any time. In her motion, the Bankruptcy Administrator cited the Debtor's failure to provide proof of any valid insurance policies on its property as well as adequately provide information as requested. Burnsville, North Carolina-based Banks Holding Company, L.P., filed for Chapter 11 bankruptcy protection (Bankr. W.D. N.C. Case No. 11-10258) on March 18, 2011. The Debtor's principal is Randy Banks. In its schedules, the Debtor disclosed $28,047,029 in total assets and $7,385,010 in liabilities. Edward C. Hay, Jr., Esq., at Pitts, Hay & Hugenschmidt, P.A., serves as the Debtor's bankruptcy counsel. BATAA/KIERLAND: Evidentiary Hearing on Cash Use Set for June 16 --------------------------------------------------------------- Bankruptcy Judge Randolph J. Haines will hold a final evidentiary hearing on June 16, 2011 at 1:30 p.m., on the request of Bataa/Kierland LLC to use cash collateral. In the meantime, the Debtor may continue to use cash collateral on an interim basis, pursuant to a budget. The Troubled Company Reporter on March 22 reported the Debtor's request to use through May 31, 2011, rents and other income generated by its Kierland Corporate Center in Scottsdale, Arizona. The Property is approximately 41% occupied; it is currently occupied by seven tenants in approximately 44,717 square feet of the building. JPMCC 2007-CIBC 19 East Greenway, LLC, has asserted a claim against the Debtor, allegedly secured by the Property, in the amount of approximately $22 million. The Lender asserts a lien in the rental and other income generated by the Property, and that income constitutes its cash collateral. The Lender has noticed a trustee's sale with respect to the Property for May 25, 2011. Additionally, in February 2011, the Lender filed certain pleadings in Maricopa County Superior Court for the State of Arizona seeking the appointment of a receiver over the Property. The Debtor's bankruptcy filing stalled those proceedings. According to minutes of an April 19 hearing, the issues to be tried at next month's evidentiary hearing are adequate protection payments, the validity of the loan and any decrease in value of the Debtor's property. JPMCC has consented to the use of its claimed cash collateral to fund only the Debtor's necessary day-to-day operational expenses. Pursuant to a five-month budget filed in April, the Debtor expect (a) monthly income from rental, parking and sales tax collected, (b) monthly expenses, and (c) profit or loss, of: April May June July August ------- ------- ------- ------- ------- Total Income $115,279 $116,007 $127,442 $139,052 $139,269 Total Expenses 43,545 86,029 55,116 57,365 56,196 Profit (or Loss) 71,734 29,978 72,326 81,687 83,073 As adequate protection for the use of its cash collateral, the Secured Creditor is granted a valid, perfected, and enforceable first-priority replacement lien upon all categories of property of the Debtor and its estate, including, but not limited to, post- petition rental income and other income generated by the Property, upon which the Secured Creditor held valid and enforceable pre- petition liens, security interests, and mortgages to the same extent and priority of the Secured Creditor's pre-petition liens. About Bataa/Kierland Bataa/Kierland, LLC, owns and operates a Class "A" office building known as Kierland Corporate Center located at 7047 E. Greenway Parkway, Scottsdale, Arizona. It filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 11-05850) on March 9, 2011. The Debtor estimated its assets and debts at $10 million to $50 million. Polsinelli Shughart PC serves as the Debtor's bankruptcy counsel. The United States Trustee said that a committee under 11 U.S.C. sec. 1102 has not been appointed because an insufficient number of persons holding unsecured claims against Bataa/Kierland have expressed interest in serving on a committee. BERNARD L. MADOFF: Trustee Details Work on Bankruptcy Case ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the trustee liquidating Bernard L. Madoff Investment Securities Inc. filed a status report trumpeting his accomplishments for the six months ended March 31, including agreements to recover $7.6 billion that would pay customers 44% of the approved amount of their claims. According to the Bloomberg report, Irving Picard, the trustee, so far has received 16,518 customer claims and allowed 2,409 for more than $6.8 billion. He has already committed to pay almost $800 million to customers using funds advanced by the Securities Investor Protection Corp. The report relates that the SIPC also has advanced almost $350 million to pay expenses of the liquidation, including professional fees. Once customer claims have been fully paid, the SIPC is entitled to recover its advances from proceeds of settlements or lawsuits. According to Mr. Rochelle, Mr. Picard said that about 425 general unsecured claims were filed for $1.7 billion in the aggregate. The trustee said he has "no funds" for distribution to general creditors. General claims include $276 million sought by other brokers. The report adds that Mr. Picard said that to date, he has filed more than 1,050 lawsuits seeking to recover $90 billion for customers. He maintains several accounts, two with about $2.1 billion invested in U.S. Treasury obligations. A brokerage account is valued at about $307 million. This month, the trustee proposed making an interim distribution of 4.1% to creditors with approved claims. 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: Trustee Defends $1-Bil. Suit vs. Mets Owners --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the trustee liquidating Bernard L. Madoff Investment Securities Inc. is opposing the motion to dismiss his $1 billion lawsuit in bankruptcy court against Fred Wilpon, Sterling Equities Inc., the owners of the New York Mets baseball club and Wilpon's friends, family, and associates. The trustee is aiming to recover $300 million in fictitious profits and $700 million in principal he said the Wilpon group was able to take out of the Madoff firm before the fraud surfaced publicly. The Wilpon group's motion to dismiss contended they were "victims" who were "defrauded by Madoff" and "never should have been targeted by the trustee." In his brief, the Madoff trustee pointed to prior Ponzi scheme cases, saying in substance there is no defense to a claim for the return of fictitious profits. The Madoff trustee contends the facts in his complaint meet the standards set in a September opinion in the Bayou Group LLC Ponzi scheme case written by U.S. District Judge Paul G. Gardephe in 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. BERRY PLASTICS: Incurs $2 Million Net Loss in April 2 Quarter ------------------------------------------------------------- Berry Plastics Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $2 million on $1.10 billion of net sales for the quarterly period ended April 2, 2011, compared with a net loss of $4 million on $1.05 billion of net sales for the quarterly period ended April 3, 2010. The Company also reported a net loss of $71 million on $2.14 billion of net sales for two quarterly periods ended April 2, 2011, compared with a net loss of $33 million on $1.93 billion of net sales for the two quarterly periods ended April 3, 2010. The Company's balance sheet at April 2, 2011, showed $5.54 billion in total assets, $5.34 billion in total liabilities and $202 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/6NfgpB About Berry Plastics Berry Plastics Corporation manufactures and markets plastic packaging products, plastic film products, specialty adhesives and coated products. At January 2, 2010 the Company had more than 80 production and manufacturing facilities, primarily located in the United States. Berry is a wholly-owned subsidiary of Berry Plastics Group, Inc. Berry Group is primarily owned by affiliates of Apollo Management, L.P. and Graham Partners. Berry, through its wholly owned subsidiaries operates five reporting segments: Rigid Open Top, Rigid Closed Top, Flexible Films, Tapes/Coatings and Specialty Films. The Company's customers are located principally throughout the United States, without significant concentration in any one region or with any one customer. On December 3, 2009, Berry Plastics obtained control of 100% of the capital stock of Pliant upon Pliant's emergence from reorganization pursuant to a proceeding under Chapter 11 for a purchase price of $602.7 million. Pliant is a leading manufacturer of value-added films and flexible packaging for food, personal care, medical, agricultural and industrial applications. The acquired business is primarily operated in Berry's Specialty Films reporting segment. * * * Berry Plastics has a 'B3' corporate family rating, with stable outlook, from Moody's Investors Service. Moody's said in April 2010 that Berry's B3 CFR reflects weakness in certain credit metrics, financial aggressiveness and acquisitiveness and a continued difficult operating and competitive environment especially in the flexible plastics and tapes segments. The rating also reflects the Company's exposure to more cyclical end markets, relatively weak contracts with customers and a high percentage of commodity products. In November 2011, Standard & Poor's Ratings Services affirmed the 'B-' corporate credit rating on Berry and its holding company parent, Berry Plastics Group Inc. "The ratings on Berry reflect the risks associated with the company's highly leveraged financial profile and acquisition- driven growth strategy as well as its fair business risk profile," said Standard & Poor's credit analyst Cynthia Werneth. BIOLIFE SOLUTIONS: Incurs $630,100 Net Loss in First Quarter ------------------------------------------------------------ Biolife Solutions, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $630,122 on $610,799 of revenue for the three months ended March 31, 2011, compared with a net loss of $531,776 on $512,909 of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.38 million in total assets, $11.48 million in total liabilities, and a $10.10 million total shareholder's deficiency. A full-text copy of the Form 10-Q is available for free at: http://is.gd/WSifCp About BioLife Solutions Bothell, Washington-based BioLife Solutions, Inc. develops and markets patented hypothermic storage and cryopreservation solutions for cells, tissues, and organs, and provides contracted research and development and consulting services related to optimization of biopreservation processes and protocols. The Company reported a net loss of $1.98 million on $2.08 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $2.77 million on $1.58 million of total revenue during the prior year. Peterson Sullivan LLP, in Seattle, Wash., expressed substantial doubt about the Company's ability to continue as a going concern, following the 2010 financial results. The accounting firm noted that the Company has been unable to generate sufficient income from operations in order to meet its operating needs and has an accumulated deficit of approximately $52 million at Dec. 31, 2010. BIOVEST INTERNATIONAL: Reports $82,000 Net Income in March 31 Qtr. ------------------------------------------------------------------ Biovest International, Inc., filed its quarterly report on Form 10-Q, reporting net income of $82,000 on $1.2 million of revenues for the three months ended March 31, 2011, compared with a net loss of $26.1 million on $1.2 million of revenue for the same period ended March 31, 2010. The Company reported an operating loss of $2.2 million for the three months ended March 31, 2011, compared to an operating loss of $311,000 for the same period ended March 31, 2010. The Company's balance sheet March 31, 2011, showed $7.3 million in total assets, $38.5 million in total liabilities, and a stockholders' deficit of $31.2 million. As of March 31, 2011, the Company had an accumulated deficit of approximately $157.4 million and working capital of approximately $2.3 million. This figure does not include those liabilities which are subject to compromise through the Company's Chapter 11 proceedings. It is expected that the ultimate outcome of these claims will be determined by the Court within the next twelve months. As reported in the Troubled Company Reporter on Dec. 20, 2010, Cherry, Bekaert & Holland, L.L.P., in Tampa, Fla., expressed substantial doubt about Biovest International's ability to continue as a going concern, following the Company's results for the fiscal year ended Sept. 30, 2010. The independent auditors noted that the Company incurred cumulative net losses since inception of roughly $149 million and cash used in operating activities of roughly $2.7 million during the two years ended Sept. 30, 2010, and had a working capital deficiency of roughly $79.6 million at Sept. 30, 2010. A full-text copy of the Form 10-Q is available for free at: http://is.gd/GBDByP About Biovest International Biovest International, Inc. -- http://www.biovest.com/-- is an emerging leader in the field of active personalized immunotherapies. In collaboration with the National Cancer Institute, Biovest has developed a patient-specific, cancer vaccine, BiovaxID(R), with three clinical trials completed, including a Phase III study, demonstrating evidence of safety and efficacy for the treatment of indolent follicular non-Hodgkin's lymphoma. Headquartered in Tampa, Florida, with its bio-manufacturing facility based in Minneapolis, Minnesota, Biovest is publicly- traded on the OTCQB(TM) Market with the stock-ticker symbol "BVTI", and is a majority-owned subsidiary of Accentia Biopharmaceuticals, Inc. (OTCQB: "ABPI"). Biovest, along with its subsidiaries, Biovax, Inc., AutovaxID, Inc., Biolender, LLC, and Biolender II, LLC, filed for Chapter 11 bankruptcy protection on Nov. 10, 2008 (Bankr. M.D. Fla. Case No. 08-17796). As reported in the Troubled Company Reporter on Nov. 19, 2010, Biovest emerged from Chapter 11 protection, and its reorganization plan became effective, on Nov. 17, 2010. BLACK RAVEN: Incurs $945,000 First Quarter Net Loss --------------------------------------------------- Black Raven Energy, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $945,000 on $233,000 of total operating revenue and other income for the three months ended March 31, 2011, compared with a net loss of $99,000 on $143,000 of total operating revenue and other income for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $14.51 million in total assets, $24.36 million in total liabilities, and a $9.85 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/lqtpsV About Black Raven Denver, Colo.-based Black Raven Energy, Inc., formerly known as PRB Energy, Inc., currently operates as an independent energy company engaged in the acquisition, exploitation, development and production of natural gas and oil in the Rocky Mountain Region of the United States. On Feb. 2, 2009, in connection with its emergence from bankruptcy, PRB Energy changed its corporate name to Black Raven Energy, Inc. On March 5, 2008, PRB Energy, Inc. and its subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Colorado. On Jan. 16, 2009, the Bankruptcy Court entered an order confirming PRB Energy reorganization plan. The Plan became effective Feb. 2, 2009. The Company reported a net loss of $3.26 million on $469,000 of total revenue for the year ended Dec. 31, 2010, compared with net income of $20.71 million on $460,000 of total revenue during the prior year. As reported by the TCR on April 21, 2011, Deloitte & Touche LLP, in Denver, Colorado, noted that the Company's recurring losses from operations and stockholders' deficit raise substantial doubt about its ability to continue as a going concern. BLOCKBUSTER CANADA: Chapter 15 Case Summary ------------------------------------------- Chapter 15 Petitioner: Michael Creber on behalf of Grant Thornton Ltd. Chapter 15 Debtor: Blockbuster Canada Co. c/o Grant Thornton Ltd. South Tower, Royal Bank Plaza 200 Bay Street, 19th Floor Toronto, ON Canada M5J 2P9 Chapter 15 Case No.: 11-12433 Type of Business: The debtor is a private company that operates video rental retail stores in Canada. Chapter 15 Petition Date: May 20, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Judge: Burton R. Lifland Debtor's Counsel: Robert J. Feinstein, Esq. PACHULSKI STANG ZIEHL & JONES LLP 780 Third Avenue, 36th Floor New York, NY 10017-2024 Tel: (212) 561-7700 Fax: (212) 561-7777 E-mail: rfeinstein@pszyj.com Estimated Assets: $50,000,001 to $100,000,000 Estimated Debts: $50,000,001 to $100,000,000 The Debtor did not file a list of creditors together with its petition. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Blockbuster Inc. 10-14997 09/23/10 BORDERS GROUP: Has Approval for TIAA Lease Termination Pact ----------------------------------------------------------- Borders Group Inc. and its units obtained the Bankruptcy Court's permission to enter into a lease termination and surrender agreement with Teachers Insurance and Annuity Association of America. In June 2006, Borders, Inc. and the predecessor-in-interest to Teachers Insurance and Annuity Association of America entered into an agreement whereby TIAA leased to the Debtors the first and second floors of premises located at 501 Boylston Street, in Boston, Massachusetts. The term of the Lease is due to expire on November 30, 2021. In connection with the Lease, BGI guaranteed all of the monetary obligations of Borders under the Lease pursuant to a lease guaranty. The store located at the Boylston Premises is a Closing Store and the liquidating agent of the Debtors is conducting a store closing sale of the Boylston store. From the period leading up to the Petition Date, the Debtors owe TIAA $111,000 under the Lease. The Debtors are current on all postpetition Rent Obligations under the Lease, through and including April 20, 2011. The Debtors and TIAA have reached an agreement for the termination of the Lease and the Debtors' surrender of the Premises to TIAA. The key terms of the Termination Agreement are: (1) The Lease will be terminated effective on the surrender date, which is the date that the Debtors have vacated the Premises in accordance with the Termination Agreement. The Termination Agreement is subject to termination if an order approving the Termination Agreement is not entered on or before June 1, 2011, as that date may be extended pursuant to the Termination Agreement. (2) In consideration of the termination of the Lease and the surrender of the Premises, TIAA will waive any and all prepetition claims it held against the Debtors or its affiliates arising under or relating to the Lease or the Guaranty except for claims in respect of the indemnification obligations. (3) The Debtors will remain obligated for payments of all rent in accordance with the provisions of the Lease accruing up to and including the Surrender Date, and the Debtors will pay promptly all amounts upon receipt of invoices from TIAA. (4) On or before the close of business on the Surrender Date, the Debtors will vacate the Premises, and surrender and deliver possession to TIAA, together with the keys to the Premises and a written acknowledgement of surrender of the Premises. Any furniture, trade fixtures and personal property left by the Debtors will become the property of TIAA, free and clear of all liens, claims, interests and encumbrances, and TIAA will have no claims against the Debtors or Guarantor. (5) The Debtors will be responsible for, and will indemnify TIAA for, any and all transfer taxes, sales taxes or other taxes or similar charges imposed by any federal, state or local governmental authority or under any law arising from or relating to the Termination Agreement or any of the other transactions. (6) Effective as of the Surrender Date, neither the Debtors nor TIAA will have any further rights or obligations under the Lease except that TIAA and the Debtors will each remain obligated to perform its indemnification obligations set forth in the Lease in the event any claims arise. BGI will have no further obligations under the Guaranty after the Surrender Date. By consensually terminating the Lease, the Debtors will no longer be obligated to pay the Rent Obligations or other obligations due under the Lease, which will total at least $17.85 million over the remaining Lease Term, Andrew K. Glenn, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, tells the Court. Rejecting the Lease, instead of the proposed termination, would create a claim for termination damages that could create a general unsecured claim of approximately $2.68 million after application of the cap under Section 502(b)(6) of the Bankruptcy Code, he asserts. About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BORDERS GROUP: Wins OK of MM 100 Lease Termination Pact ------------------------------------------------------- Debtor Borders, Inc. and 100 Property LLC entered into an agreement for the Debtors' lease of portions of the basement level, the ground level, the entire mezzanine level, the entire second floor, and an area below the floor slab of the basement of a building located at 100 Broadway, New York. In connection with the Lease, Borders Group, Inc. entered into a lease guaranty, whereby BGI guaranteed all of the obligations of Borders under the Lease. The Lease was assigned by 100 Property to 100 Broadway Property LLC, and further assigned by 100 Broadway to MM 100 Broadway LLC. The Lease will expire on June 30, 2018. The Borders store located at the leased premises is a closing store and the liquidating agent of the Debtors is conducting a store closing sale that is expected to conclude by April 30, 2011. Accordingly, the Debtors and MM 100 have agreed to the termination of the Lease and the Debtors' surrender of the Premises to MM 100. The key terms of the Termination Agreement are: (1) The Lease will be terminated effective on the surrender date, which refers to the date the Debtors have vacated the Premises in accordance with the Termination Agreement. The Termination Agreement may be void if an order approving the Termination Agreement is not entered on or before June 1, 2011, as that date may be extended. (2) The Debtors will deliver notice of their intent to vacate the Premises, to MM 100 at least five days prior to the Surrender Date. The Debtors will vacate the Premises on or before April 30, 2011. (3) In consideration of the termination of the Lease and the surrender of the Premises, MM 100 will make a $375,000 surrender payment to the Debtors, payable as: (i) $187,500, which will be paid to the Debtors on the Surrender Date; and (ii) $187,500, which will be paid to the Debtors on the date that MM 100 receives notice of entry of the order by the Court approving the Termination Agreement. (4) The Debtors will remain obligated for payments of rent in accordance with the Lease accruing up to and including April 30, 2011. If the Debtors fail to pay any rent accrued with respect to the period ending the Rent Termination Date, then MM 100 will be entitled to deduct the unpaid rent from the Surrender Payment. (5) Effective as of the Surrender Date, neither the Debtors nor MM 100 will have any further rights or obligations under the Lease except that MM 100 and the Debtors will remain obligated to perform each of their indemnification obligations as set forth in the Lease in the event any claims arise. BGI will also have no further obligations under the Guaranty after the Surrender Date. The Debtors sought and obtained the Bankruptcy Court's permission to enter into the Termination Agreement. Andrew K. Glenn, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, asserts that by consensually terminating the Lease, the Debtors will no longer be obligated to pay the Rent Obligations or other obligations due under the Lease, which will total at least $12.8 million over the remaining Lease Term. Rejecting the Lease instead of the proposed termination, he notes, would create a claim for termination damages that could create a general unsecured claim of about $1.84 million after application of a Section 502(b)(6) of the Bankruptcy Code cap. About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BORDERS GROUP: Has Stipulation for Replacement LOC with Travelers ----------------------------------------------------------------- Borders Group and The Travelers Indemnity Company and its affiliates entered into a stipulation, which provides for a replacement of a letter of credit issued September 19, 2002. Travelers Indemnity provided certain workers' compensation and automobile coverage to the Debtors for the period from February 1, 1995 to February 1, 2001. The Debtors have continuing payment obligations under the Policies and the Debtors and Travelers Indemnity entered into corresponding agreement letters, which prescribe calculation and payment of premium and reimbursement obligations. As required under the Insurance Program, Travelers Indemnity is the beneficiary of an irrevocable letter of credit issued by Bank of America N.A. on September 19, 2002, currently in the amount of $1,400,000, which supports the Debtors' obligation to Travelers in connection with the Insurance Program. Travelers Indemnity is also holding $26,466 in escrow deposits as additional collateral for the Debtors' obligations under the Insurance Program. The Current LoC expires on June 21, 2011. The Current LOC contains an "evergreen" renewal provision, which provides for the automatic renewal of the Current LoC on an annual basis, provided that a written notice of non-renewal has not been issued by BofA to Travelers Indemnity. In February 2011, BofA sent written notice to Travelers Indemnity that the Current LOC would not be renewed beyond the Expiration Date. As a result, Travelers Indemnity has the right to draw down on the Current LoC and hold the proceeds to support the Debtors' obligations to Travelers Indemnity under the Insurance Program until the time as Travelers Indemnity determines the obligations, if any, have been satisfied. The Debtors wish to avoid a draw by Travelers Indemnity under the Current LoC and have sought that Travelers Indemnity agree to accept a replacement letter of credit on substantially the same terms as the Current LoC to be issued in accordance with the DIP Agreement by a LoC Issuer. Travelers Indemnity has agreed not to commence the process to draw on the Current LoC, provided that it receives, on or before June 6, 2011, (i) written notice of entry of a final order by the Court approving the parties' stipulation; and (ii) a Replacement LoC, in form and substance satisfactory to Travelers Indemnity. The Debtors contend that the Replacement LoC is authorized under the DIP Agreement. The Debtors also state that General Electric Capital Corp., as working capital agent under the DIP Agreement, does not object to approval of the Parties' Stipulation. The Parties specifically stipulate that: (1) The Debtors are authorized to seek issuance of the Replacement LoC; (2) The Replacement LoC will replace the Current LoC and back the Debtors' obligations to Travelers under the Insurance Program; (3) The Insurance Program will remain the valid and binding obligation of the Debtors and Travelers Indemnity in accordance with its terms with respect to obligations with dates of loss during the Policy Period; and (4) It is appropriate and acceptable for Travelers Indemnity to accept the Replacement LoC as substitute collateral to back the Debtors' obligations under the Insurance Program. The Court will consider the Parties' Stipulation on May 20, 2011. Objections are due on the same date. About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BRIGHAM EXPLORATION: Amends Credit Agreement with BoA ----------------------------------------------------- Brigham Oil & Gas, L.P., Brigham Exploration Company and Brigham Inc. entered into a First Amendment to Fifth Amended and Restated Credit Agreement among Brigham, each of the lenders from time to time party thereto and Bank of America, N.A., as administrative agent for the Lenders. The First Amendment amends the Credit Agreement to provide that the maximum permitted senior note amount will automatically increase (up to a maximum of $600 million) upon the issuance of senior notes between the effective date of the First Amendment and the date of the next borrowing base redetermination by an amount equal to the aggregate principal amount of the senior notes issued minus the aggregate principal amount of any senior notes redeemed, retired or purchased with the proceeds from the sale or issuance of such senior notes. A copy of the First Amendment is available for free at: http://is.gd/60eLHs About Brigham Exploration Austin, Texas-based Brigham Exploration Company (NASDAQ: BEXP) -- http://www.bexp3d.com/-- is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. In late 2007, the majority of the Company's drilling capital expenditures shifted from its historically active areas in the Onshore Gulf Coast, the Anadarko Basin and West Texas to the Williston Basin in North Dakota and Montana, where the Company is currently targeting the Bakken, Three Forks and Red River objectives. The Company reported net income of $42.89 million on $169.72 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $122.99 million on $70.34 million of revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $1.16 billion in total assets, $565.38 million in total liabilities, and $595.91 million in stockholders' equity. * * * As reported by the TCR on Feb. 18, 2011, Moody's Investors Service upgraded Brigham Exploration Company's Corporate Family Rating to B3 from Caa1 and the Probability of Default Rating to B3 from Caa1. "The primary driver for the upgrade is Brigham's strong reserve and production growth and significant financial flexibility," said Francis J. Messina, Moody's Vice President. "The B3 Corporate Family Rating is prospective and it incorporates Moody's expectation that the company will significantly increase proved developed reserves and production rates over the next two years." BRIGHAM EXPLORATION: Accelerating Drilling Operations ----------------------------------------------------- Brigham Exploration Company announced that it is accelerating its pace of drilling operations in the Williston Basin and expects to be at 10 operated rigs by July 2011, which is approximately six months ahead of its previously announced schedule. Brigham also announced that it has further expanded its Williston Basin acreage position, primarily as a result of an acquisition in its core de- risked area, and that it currently holds 378,100 net acres, 224,400 of which are located in its core operating projects. As a result of its drilling acceleration and acreage acquisitions, Brigham announced that it has increased its oil and gas capital expenditure budget to $835.5 million. Brigham also provided an update on its drilling and completion activities in the Williston Basin. Drilling Acceleration Brigham announced that it will accelerate its pace of operated drilling activities in the Williston Basin by adding rig eight later this month, rig nine in June 2011 and rig 10 in late June or early July 2011. Its 11th and 12th operated rigs are anticipated to be added in the first quarter 2012 and will be specially built walking rigs capable of maximizing efficiencies associated with smart pad drilling. As a result of the acceleration, Brigham anticipates that an additional 8.2 net wells will be spud in 2011. Williston Basin Acreage Acquisition Brigham has entered into a binding agreement to acquire additional acreage in the Williston Basin, largely in its core de-risked project areas. As a result of the transaction, which is expected to close in approximately 30 days, Brigham will have approximately 378,100 net acres in the Williston Basin, of which 224,400 are located in its core operating areas. Including the aforementioned transaction, Brigham approximates that its core de-risked drilling inventory now totals 783 net remaining drilling locations. Updated Oil and Gas Capital Expenditure Budget As a result of its drilling acceleration and acreage acquisitions Brigham announced that it is increasing its oil and gas capital expenditure budget to $835.5 million in 2011. The bulk of the increase will fund the capital spent in 2011 to drill 8.2 additional net Williston Basin wells, additional acreage acquisitions and the construction of additional support infrastructure to add rail yard facilities west of the Nesson Anticline to create efficiencies for the unloading of oil and gas tubulars and proppant. The expansion of the 2011 capital budget is subject to securing additional external capital. Initial 2011 May Revised Budget 2011 Budget ------------ ----------- Drilling $582.1 $669.2 Land 27.4 79.2 Support Infrastructure 83.2 87.1 ------------ ----------- Oil and gas capital expenditures $692.7 $835.5 Williston Basin Operated Drilling and Completion Update Brigham's accelerated development of its acreage in North Dakota and Montana is proceeding with four operated rigs drilling in Rough Rider, two operated rigs drilling in Ross and one operated rig drilling in Montana. In North Dakota, Brigham is currently drilling a Three Forks well in its Rough Rider project area in Williams County and has a Three Forks well waiting on completion in its Ross project area in Mountrail County. Two additional Three Forks wells are anticipated to spud in Rough Rider by mid-summer, both of which are in McKenzie County. In Montana, Brigham recently completed drilling operations on the Gobbs 17-8 #1H, which is located in Roosevelt County, and will drill two consecutive additional wells in Montana, one of which is located in Roosevelt County and the other in Richland County. Brigham currently has five wells flowing back, three wells fracing, two of which are being simultaneously fracture stimulated, and 14 wells waiting on completion. To date, Brigham has completed 61 consecutive long lateral high frac stage wells in North Dakota at an average early 24-hour peak rate of approximately 2,880 barrels of oil equivalent. Brigham is currently running two fully dedicated frac crews focused on completing Brigham operated horizontal wells in the basin. Brigham estimates that it will be capable of fracture stimulating and bringing on line to production a minimum of eight wells per month, with the goal of achieving 10 fracs per month due to the efficiencies gained by zipper fracs. Management Comments Bud Brigham, the Chairman, President and CEO, commented, "We're very excited to announce additional acceleration in the Williston Basin and expect to reach 10 operated rigs by July, roughly six months ahead of our previously announced plan. We believe that our smart pad efficiency initiatives, which incorporate zipper fracs, provide us the flexibility to ramp our operated rig count earlier than anticipated without the need to secure incremental pressure pumping capacity. Given our deep de-risked drilling inventory on our growing core acreage in the Williston Basin, this acceleration helps to accrete additional net asset value to our stockholders by pulling forward wells in the current period that would have otherwise been drilled much later. As we progress and gain more experience with the anticipated efficiencies in drilling and completing our wells utilizing our smart pads, we will revisit our production estimates for the full year 2011 and expect to update production guidance on our second quarter conference call." Bud Brigham continued, "Our Land Department continues to exceed expectations with acreage additions that have increased our overall position in the Williston Basin by 13,800 net acres since last year. The majority of the acreage has been added to our core areas in Rough Rider and Montana at favorable per acre rates relative to other recently announced transactions. In addition, included in the updated land capital budget is capital that we have included to continue with our ground floor leasing efforts for the remainder of 2011. In total, we now estimate that we have 783 net de-risked locations remaining to be drilled. If we and other operators continue to see positive results in the Three Forks in Rough Rider, we believe our core de-risked inventory could be as high as 1,283 net remaining locations." About Brigham Exploration Austin, Texas-based Brigham Exploration Company (NASDAQ: BEXP) -- http://www.bexp3d.com/-- is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. In late 2007, the majority of the Company's drilling capital expenditures shifted from its historically active areas in the Onshore Gulf Coast, the Anadarko Basin and West Texas to the Williston Basin in North Dakota and Montana, where the Company is currently targeting the Bakken, Three Forks and Red River objectives. The Company reported net income of $42.89 million on $169.72 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $122.99 million on $70.34 million of revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $1.16 billion in total assets, $565.38 million in total liabilities, and $595.91 million in stockholders' equity. * * * As reported by the TCR on Feb. 18, 2011, Moody's Investors Service upgraded Brigham Exploration Company's Corporate Family Rating to B3 from Caa1 and the Probability of Default Rating to B3 from Caa1. "The primary driver for the upgrade is Brigham's strong reserve and production growth and significant financial flexibility," said Francis J. Messina, Moody's Vice President. "The B3 Corporate Family Rating is prospective and it incorporates Moody's expectation that the company will significantly increase proved developed reserves and production rates over the next two years." BRIGHAM EXPLORATION: To Offer $250 Million Senior Notes Due 2019 ---------------------------------------------------------------- Brigham Exploration Company has launched an offering for $250 million of senior notes due 2019. The offering of the Senior Notes, which is subject to market availability as well as other conditions, will be made only to qualified institutional buyers and to buyers outside the United States in compliance with Regulation S. Brigham intends to use the net proceeds to fund portions of its 2011 and 2012 capital budgets and for general corporate purposes. The Senior Notes have not been registered under the Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and state securities laws. This announcement will not constitute an offer to sell or a solicitation of an offer to buy the Senior Notes. About Brigham Exploration Austin, Texas-based Brigham Exploration Company (NASDAQ: BEXP) -- http://www.bexp3d.com/-- is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. In late 2007, the majority of the Company's drilling capital expenditures shifted from its historically active areas in the Onshore Gulf Coast, the Anadarko Basin and West Texas to the Williston Basin in North Dakota and Montana, where the Company is currently targeting the Bakken, Three Forks and Red River objectives. The Company reported net income of $42.89 million on $169.72 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $122.99 million on $70.34 million of revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $1.16 billion in total assets, $565.38 million in total liabilities, and $595.91 million in stockholders' equity. * * * As reported by the TCR on Feb. 18, 2011, Moody's Investors Service upgraded Brigham Exploration Company's Corporate Family Rating to B3 from Caa1 and the Probability of Default Rating to B3 from Caa1. "The primary driver for the upgrade is Brigham's strong reserve and production growth and significant financial flexibility," said Francis J. Messina, Moody's Vice President. "The B3 Corporate Family Rating is prospective and it incorporates Moody's expectation that the company will significantly increase proved developed reserves and production rates over the next two years." CAESARS ENTERTAINMENT: Amends Senior Secured Credit Agreement ------------------------------------------------------------- Caesars Entertainment Operating Company, Inc., the borrower, a wholly owned subsidiary of Caesars Entertainment Corporation, determined it received the requisite consents required for the previously announced amendment to its senior secured credit agreement and the Borrower and the Company entered into an agreement to provide for the amendment of the Credit Agreement to, among other things: (i) extend the maturity of B-1, B-2 and B-3 term loans held by consenting lenders to Jan. 28, 2018, and increase the interest rate with respect to the Extended Term Loans, (ii) convert up to $816 million of revolver commitments held by consenting lenders into Extended Term Loans, (iii) extend to Jan. 28, 2015, the maturity of revolver commitments held by consenting lenders who elect not to convert their commitments to term loans and increase the interest rate and the undrawn fee with respect to such extended revolver commitments, (iv) allow the Borrower to buy back loans from individual lenders at negotiated prices at any time, which may be less than par, (v) allow the Borrower to extend the maturity of term loans or revolving commitments, as applicable, and for the Borrower to otherwise modify the terms of loans or revolving commitments in connection with such an extension and (vi) modify certain other provisions of the Credit Agreement. The results of the extension offers under the Amendment Agreement continue to be tabulated and will be separately reported by the Company. The effectiveness of the Amendment Agreement and the extension of the loans thereunder is subject to the reaffirmation of the security under the Credit Agreement and other customary closing conditions. About Caesars Entertainment Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. -- http://www.caesars.com/-- is one of the world's largest casino companies, with annual revenue of $4.2 billion, 20 properties on three continents, more than 25,000 hotel rooms, two million square feet of casino space and 50,000 employees. Caesars casino resorts operate under the Caesars, Bally's, Flamingo, Grand Casinos, Hilton and Paris brand names. The Company has its corporate headquarters in Las Vegas. The Company's balance sheet at March 31, 2011, showed $28.40 billion in total assets, $26.84 billion in total liabilities and $1.56 billion in total stockholders' equity. * * * Harrah's announced its re-branding to Caesar's on mid-November 2010. Harrah's carries 'Caa3' long term corporate family and probability of default ratings, with 'positive' outlook, from Moody's Investors Service. It has a 'B-' issuer credit rating, with 'stable' outlook, from Standard & Poor's. As reported by the TCR on March 3, 2011, Moody's Investors Service upgraded Caesars Entertainment's Corporate Family ratings and Probability of Default ratings to Caa2. CET's Caa2 Corporate Family Ratings reflect very high leverage, weak interest coverage, the company's debt financed growth strategy, and Moody's view that the company's current capital structure in unsustainable in the long-term. The ratings reflect Moody's expectation that gaming demand will rebound very slowly over the next several years. However, in the absence of a material de-leveraging transaction, Moody's do not expect the company's capital structure to improve materially over the next few years. Additionally, given CEC's weak credit profile, there is a possibility that the company could again pursue transactions that will result in impairment of debt holder claims as a means to improve its capital structure. CAPITOL CITY BANCSHARES: Reports $85,300 Net Income in Q1 2011 -------------------------------------------------------------- Capitol City Bancshares, Inc., filed its quarterly report on Form 10-Q, reporting net income of $85,302 on $2.17 million of net interest income for the three months ended March 31, 2011, compared with net income of $120,743 on $2.19 million of net interest income for the same period last year. The Company's balance sheet at March 31, 2011, showed $304.98 million in total assets, $295.57 million in total liabilities, and stockholders' equity of $9.41 million. "The continuing level of problem loans as of the quarter ended March 31, 2011, and capital levels continuing to be in the "under capitalized" category of the regulatory framework for prompt corrective action as of March 31, 2011, continue to create substantial doubt about the Company's ability to continue as a going concern," the Company said in the filing. As reported in TCR on April 26, 2011, Nichols, Cauley & Associates, LLC, in Atlanta, Georgia, expressed substantial doubt about Capitol City Bancshares' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company the Company is operating under regulatory orders to, among other items, increase capital and maintain certain levels of minimum capital. "As of Dec. 31, 2010, the Company was not in compliance with these capital requirements. In addition to its deteriorating capital position, the Company has suffered significant losses related to nonperforming assets, has experienced declining levels of liquid assets, and has significant maturities of liabilities within the next twelve months." A complete text of the Form 10-Q is available for free at: http://is.gd/tCu9gw Atlanta, Ga.-based Capitol City Bancshares, Inc., was incorporated under the laws of the State of Georgia on April 14, 1998, for the purpose of serving as a bank holding company for Capitol City Bank and Trust Company. The Bank operates a full-service banking business and engages in a broad range of commercial banking activities, including accepting customary types of demand and timed deposits, making individual, consumer, commercial, and installment loans, money transfers, safe deposit services, and making investments in U.S. government and municipal securities. The Bank serves the residents of the City of Atlanta and Fulton, DeKalb, Chatham, Richmond and Dougherty Counties. CAPMARK FINANCIAL: Seeks to Buy Tax Credit Loans From Affiliate --------------------------------------------------------------- BankruptcyData.com reports that Capmark Financial Group filed with the U.S. Bankruptcy Court a motion for an order authorizing Capmark Finance to (I) purchase new market tax credit loans owned by non-debtor affiliate Capmark Bank and (II) sell the newly- acquired loans to U.S. Bancorp Community Development and U.S. Bancorp Community Investment, free and clear of all liens, claims, encumbrances. BData says the Court scheduled a June 7, 2011 hearing on the matter. About Capmark Financial Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- provides financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. Capmark has 1,000 employees located in 37 offices worldwide. On Oct. 25, 2009, Capmark Financial and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 (Bankr. D. Del. Lead Case No. 09-13684). Capmark disclosed assets of US$20 billion against total debts of US$21 billion as of June 30, 2009. Capmark's financial advisors are Lazard Freres & Co. LLC and Loughlin Meghji + Company. Capmark's bankruptcy counsel is Dewey & LeBoeuf LLP. Richards, Layton & Finger, P.A., serves as local counsel. Beekman Advisors, Inc., is serving as strategic advisor. KPMG LLP is tax and accounting advisor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. The Official Committee of Unsecured Creditors in Capmark Financial Group Inc.'s cases tapped Kramer Levin Naftalis & Frankel LLP as its counsel and JR Myriad LLC as its commercial real estate business advisors. The Committee also retained Cutler Pickering Hale and Dorr LLP as its attorneys for the special purpose of providing legal services in connection with Federal Deposit Insurance Corporation matters. Protech Holdings C LLC, an affiliate of Capmark, filed for Chapter 11 protection on July 29, 2010 (Bankr. D. Del. Case No. 10-12387). The Debtor estimated assets and debts in excess of $1 billion as of the filing date. Since filing for Chapter 11, Capmark completed three sales to generate more than $1 billion in cash. Berkshire Hathaway Inc. and Leucadia National Corp. bought most of the business for $468 million. In April 2011, Greenline Ventures LLC completed the acquisition of the New Markets Tax Credit division of Capmark Financial Group Inc. Since inception of the NMTC program, Capmark's NMTC division has closed over $1.1 billion of NMTC investment funds and financed over $2.5 billion of projects and businesses in low income communities nationwide. CASCADES INC: S&P Affirms CCR at 'BB-'; Outlook Now Positive ------------------------------------------------------------ Standard & Poor's Ratings Services revised its outlook on Cascades Inc. to positive from stable. "At the same time, we affirmed our ratings on Cascades, including our 'BB-' long-term corporate credit rating on the company," S&P said. "The outlook revision to positive reflects the company's recent debt paydown and our expectation that profitability will improve through 2011 and leverage will decline to 3.5x," said Standard & Poor's credit analyst Jatinder Mall. The ratings on Cascades reflect what Standard & Poor's views as the company's good market position in consolidated markets, a diverse revenue stream, and vertical integration. "These strengths are partially offset, in our opinion, by what we see as the company's exposure to cyclical boxboard and containerboard markets, volatile recycled fiber prices, and high debt levels," S&P noted. Cascades is an integrated packaging and tissue company that manufactures, converts, collects, and processes recycled paper. It is the No. 1 containerboard producer in Canada, and the third- largest producer of coated recycled boxboard and fourth-largest tissue producer in North America. The company operates facilities in Canada, the U.S., and to a lesser extent, Europe. The company operates in consolidated markets with a good market position in each segment. Its operations are fairly diverse with no one segment representing more than one-third of Cascades' overall revenues and EBITDA. "While we view the company's tissue business to be fairly stable with steady growth in demand, price increases are difficult to implement given the highly competitive nature of the industry and its large customers. Cascades other two key businesses, containerboard and boxboard, are cyclical. Overall, the company's profitability depends on its ability to pass through recycled fiber costs, which represent about one-third of its production costs. While sale prices do move up with increases in recycled fiber prices, there is often a lag of few months. Recycled fiber prices tend to be volatile and influenced by demand from China. Cascades' upstream integration into its paper recovery business provides the company with one-third of its recycled fiber needs. However, this does not insulate it from volatile recycled paper prices because the prices that Cascades pays for most of the collected paper are based on spot recycled paper prices," S&P related. "The positive outlook reflects Cascades' recent debt paydown and our expectation that its profitability will improve throughout the year as recently announced price increases flow through. Standard & Poor's could upgrade the company if these price increases were to result in greater profitability as expected and if the company sustains a leverage ratio of about 3.5x. On the other hand, Standard & Poor's could lower the ratings if the company is unable to pass through increasing fiber and energy costs, leading to lower EBITDA generation and a leverage ratio of more than 4.5x," S&P added. CHINA CENTURY: Receives Add'l Notice of NYSE Amex Non-Compliance ---------------------------------------------------------------- China Century Dragon Media, Inc. disclosed that, as expected, on May 17, 2011, the Company received an additional notice of non- compliance from the NYSE Amex LLC due to the delay in the filing of the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2011 with the Securities and Exchange Commission, which report is required by Sections 134 and 1101 of the Exchange's Company Guide. The Company plans to address its plan for filing the Form 10-Q at its scheduled hearing before a Listing Qualifications Panel of the Exchange's Committee on Securities. As previously reported, on March 23, 2011 and April 5, 2011, the Company received delisting notifications from the Exchange unless it appealed the Staff's delisting determination, which was based on the Exchange's review of the resignation letter from the Company's former auditor, MaloneBailey LLP, and the delay in the filing of the Company's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2010. The Company timely requested a hearing before the Panel. The most recent notice of non-compliance has no immediate effect on the listing of the Company's common stock on the Exchange. About China Century China Century Dragon Media is a television advertising company in China that primarily offers blocks of advertising time on certain channels on China Central Television ("CCTV"), the state television broadcaster of China and China's largest television network. The Company purchases, repackages and sells advertising time on certain of the nationally broadcast television channels of CCTV. The Company assists its customers in identifying the most appropriate advertising time slots for their television commercials based on the customer's advertising goals and in developing a cost-effective advertising program to maximize their return on their advertising investment. CHINA RITAR: Receives Nasdaq Staff Deficiency Letter ---------------------------------------------------- China Ritar Power Corp. filed an 8-K disclosing that on April 15, 2011, the Company received oral notice from The Nasdaq Stock Market advising that the Company was not in compliance with Nasdaq's continued listing requirements set forth in Nasdaq Marketplace Rule 5250(c)(1), which requires timely filing of SEC periodic reports, because it failed to timely file its annual report on Form 10-K for the fiscal year ended Dec. 31, 2010. As a result, Nasdaq halted trading of the Company's common stock indefinitely, effective Monday April 18, 2011. On April 22, 2011, the Company filed an 8-K and issued a press release disclosing that the Company received a written notice, dated April 18, 2011, from Nasdaq advising that the Company was not in compliance with Nasdaq's continued listing requirements set forth in Nasdaq Marketplace Rule 5250(c)(1). In its notice, Nasdaq required that the Company submit a plan of compliance by May 3, 2011 to advise Nasdaq of any action that the Company has taken, or will take, to file the 10-K for 2010 and bring the Company into compliance with the listing standards. If Nasdaq accepts the Company's plan, they may grant an extension of 180 calendar days, or until September 27, 2011, during which the Company can regain compliance. If Nasdaq does not accept the plan, or if the Company does not regain compliance during any applicable extension period, the Nasdaq staff will provide written notice that the Company's common stock is subject to delisting. On May 3, 2011, the Company submitted a plan of compliance to Nasdaq. On May 12, 2011, the Company supplemented the plan of compliance. On May 17, 2011, the Company received a written notice from Nasdaq advising that the Company was not in compliance with Nasdaq's continued listing requirements set forth in Nasdaq Marketplace Rule 5250(c) due to the failure to file its quarterly report on Form 10-Q for the three months ending March 31, 2011 (the "10-Q"). As a result of the additional delinquency, Nasdaq is requesting the Company provide Nasdaq an update on the progress towards implementing its plan of compliance and on the Company's plan to file the 10-Q. Nasdaq has requested that this update be provided by May 31, 2011. The Company intends to file the 10-K and 10-Q with the Securities and Exchange Commission as soon as practicable. About China Ritar China Ritar -- http://www.ritarpower.com/-- designs, develops, manufactures and markets environmentally friendly lead acid batteries with a wide range of capacities and applications, including telecommunications, Uninterrupted Power Source (UPS) devices, Light Electrical Vehicles (LEV), and alternative energy production (solar and wind power). CHINA RUITAI: Reports $735,900 First Quarter Net Income ------------------------------------------------------- China Ruitai International Holdings Co., Ltd., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income attributable to China Ruitai of $735,893 on $9.58 million of sales for the three months ended March 31, 2011, compared with net income attributable to China Ruitai of $1.94 million on $10.23 million of sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $111.92 million in total assets, $81.08 million in total liabilities and $30.84 million in total equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/eCVTh2 About China Ruitai Shandong, China-based China Ruitai International Holdings Co., Ltd., was organized under the laws of the State of Delaware on Nov. 15, 1955, under the name "Inland Mineral Resources Corp." Currently, the Company, through its wholly-owned subsidiary, Pacific Capital Group Co., Ltd., a corporation incorporated under the laws of the Republic of Vanuatu, and its majority-owned subsidiary, TaiAn RuiTai Cellulose Co., Ltd., a Chinese limited liability company, is engaged in the production, sales, and exportation of deeply processed chemicals, with a primary focus on non-ionic cellulose ether products in the People's Republic of China as well as to the United States, Europe, Japan, India and South Korea. As reported by the TCR on April 8, 2011, Bernstein & Pinchuk LLP, in New York, after auditing the Company's financial statements for the year ended Dec. 31, 2010, expressed substantial doubt about China Ruitai's ability to continue as a going concern. The independent auditors noted that the Company has negative working capital. CHINA VILLAGE: Can Access Cash Collateral to Pay Property Taxes --------------------------------------------------------------- The Hon. Arthur S. Weissbrodt of the U.S. Bankruptcy Court for the Northern District of California approved a stipulation, authorizing China Village, LLC, to use the cash collateral for payment of real property tax. The stipulation was entered among its secured creditors Cathay Bank and Fremont Investment Property Company, LLC, successor to Redwood Mortgage Investors VIII. Cathay Bank and Fremont hold a lien on the Debtor's rental income, which constitutes the banks' cash collateral. The Debtor's primary asset is a commercial property which is comprised of three parcels, with the parcels identified as APN 531-240-32 (Parcel 32), APN 531-240-34 (Parcel 34), and APN 531-240-35 (Parcel 35). The parties agree that the Debtor is authorized to utilize cash collateral in order to pay the property taxes: Parcel 32: $52,978 Parcel 34: $50,668 Parcel 35: $75,134 ------- Total: $178,781 The Debtor relates that as of March 15, 2011, the balance of the DIP Account is $431,160, and therefore there is sufficient cash on hand to pay the real property taxes. The Debtor is represented by: Lawrence A. Jacobson, Esq. Sean M. Jacobson, Esq. COHEN AND JACOBSON, LLP 900 Veterans Boulevard, Suite 600 Redwood City, CA 94063 Tel: (650) 261-6280 Fax: (650) 368-6221 About China Village Milpitas, California-based China Village, LLC, is a limited liability company that was created on May 10, 2005. The members of the Debtor are Thomas Nguyen, the Responsible Individual in this case (8%), Joseph Nguyen (9%) and Tuyet Minh Le (83%). The Debtor is in the business of purchasing, leasing, renovating and selling commercial real property. The Debtor currently owns a significant commercial property in Fremont, California, that has 370,019 square feet of rentable space on 25.07 acres of land. China Village filed for Chapter 11 bankruptcy protection (Bankr. N.D. Calif. Case No. 10-60373) on Oct. 4, 2010. Lawrence A. Jacobson, Esq., and Sean M. Jacobson, Esq., at Cohen and Jacobson, LLP, assist the Debtor in its restructuring effort. R&K Interests, Inc. d/b/a Investors Property Services serves as the Debtor's Property Manager. The Debtor estimated its assets and debts at $10 million to $50 million as of the Petition Date. CHRISTIAN BROTHERS: Schedules Filing Deadline Extended to June 13 ----------------------------------------------------------------- The Christian Brothers' Institute and The Christian Brothers of Ireland, Inc., won an extension of the deadline to file their Schedules of Assets and Liabilities and Statements of Financial Affairs from May 12, 2011 through and including June 13, 2011. Rule 1007(c) of the Federal Rules of Bankruptcy Procedure requires each of the Debtors to file Schedules no more than 14 days after the bankruptcy petition date unless the Court grants an extension. The Debtors said they are in need of additional time to complete the schedules. The Debtors have a limited in-house financial staff and these individuals have been pulled in numerous directions answering questions of various entities and schools as a result of the Chapter 11 filings. About Christian Brothers' Institute The Christian Brothers' Institute in New Rochelle, New York, is a domestic not-for-profit 501(c)(3) corporation organized under Sec. 102(a)(5) of the New York Not-for-Profit Corporation Law. CBI was formed to establish, conduct and support Catholic elementary and secondary schools principally throughout New York State. The Christian Brothers of Ireland, Inc., in Chicago, Illinois, is a domestic not-for-profit 501(c)(3) corporation organized under the Not-for-Profit Corporation Law of the State of Illinois. CBOI was formed to establish, conduct and support Catholic elementary and secondary schools principally throughout the State of Illinois, as well as other spiritual and temporal affairs of the former Brother Rice Province of the Congregation of Christian Brothers. CBI and CBOI depend upon grants and donations to fund a portion of their operating expenses. The Christian Brothers' Institute and The Christian Brothers of Ireland filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case Nos. 11-22820 and 11-22821) on April 28, 2011. Scott S. Markowitz, Esq., at Tarter Krinsky & Drogin LLP, serves as the Debtors' bankruptcy counsel. CBI estimated its assets at $50 million to $100 million and debts at $1 million to $10 million. CBOI estimated its assets at $500,000 to $1 million and debts at $1 million to $10 million. No official committee of unsecured creditors has been appointed. CICERO INC: Incurs $435,000 Net Loss in First Quarter ----------------------------------------------------- Cicero Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $435,000 on $729,000 of total operating revenue for the three months ended March 31, 2011, compared with a net loss of $1.09 million on $483,000 of total operating revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $4.91 million in total assets, $12.01 million in total liabilities, and a $7.10 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/CP5oi2 About Cicero Inc. Cary, N.C.-based Cicero, Inc., provides business integration software solutions and also provides technical support, training and consulting services as part of its commitment to providing customers with industry-leading solutions. The Company focuses on the customer experience management market with emphasis on desktop integration and business process automation with its Cicero XM(TM) products. Cicero XM enables the flow of data between different applications, regardless of the type and source of the application, eliminating redundant entry and costly mistakes. The Company reported a net loss of $459,000 on $2.97 million of total operating revenue for the year ended Dec. 31, 2010, compared with a net loss of $1.28 million on $2.49 million of total operating revenue during the prior year. As reported by the TCR on April 6, 2011, Marcum LLP, in Bala Cynwyd, Pennsylvania, noted that the Company's recurring losses from operations and working capital deficiency raise substantial doubt about its ability to continue as a going concern. CIRTRAN CORP: Delays Filing of First Quarter Form 10-Q ------------------------------------------------------ CirTran Corporation informed the U.S. Securities and Exchange Commission that its Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, could not be filed without unreasonable effort or expense within the prescribed time period because management requires additional time to compile and verify the data required to be included in the report. About CirTran Corporation West Valley City, Utah-based CirTran Corporation (OTC BB: CIRC) -- http://www.CirTran.com/-- markets and manufactures energy drinks under the Playboy brand pursuant to a license agreement with Playboy Enterprises, Inc. The Company also provides turnkey manufacturing services and products using various high-tech applications for electronics manufacturers in various industries. The Company reported a net loss of $4.95 million on $9.04 million of net sales for the year ended Dec. 31, 2010, compared with a net loss of $5.81 million on $9.73 million of net sales during the prior year. As reported by the TCR on April 21, 2011, Hansen, Barnett & Maxwell, P.C., Salt Lake City, Utah, noted that the Company has an accumulated deficit, has suffered losses from operations and has negative working capital that raise substantial doubt about its ability to continue as a going concern. CLAIRE'S STORES: Expects $346-Mil. in Net Sales for First Quarter ----------------------------------------------------------------- Claire's Stores, Inc., announced selected preliminary, unaudited financial results for the 2011 first quarter, which ended April 30, 2011. The financial results are unaudited and should be considered preliminary and subject to change. The Company does not currently expect to update this information prior to the release of its first quarter 2011 financial results. The Company expects to hold its regular quarterly conference call after those results are released. The Company expects to report net sales of $346 million for the 2011 first quarter, an increase of $24 million, or 7.6%, compared to the 2010 first quarter. The increase was attributable to new store sales, an increase in same store sales, favorable foreign currency translation effect of our foreign locations' sales and increases in shipments to franchisees, partially offset by the effect of store closures. Net sales would have increased 5.3% excluding the impact from foreign currency rate changes. Consolidated same store sales increased 3.2% in the 2011 first quarter. In North America, same store sales increased 4.8% in the 2011 first quarter. In Europe, same store sales increased 0.1% in the 2011 first quarter. The Company's same store sales trend through the first 15 days of the fiscal 2011 second quarter is in the low negative single digits driven primarily by underperformance in our European Division. The Company computes same store sales on a local currency basis, which eliminates any impact from changes in foreign exchange rates. Adjusted EBITDA in the 2011 first quarter is expected to be between $51 million and $53 million, compared to $49.2 million in the 2010 first quarter. The Company defines Adjusted EBITDA as earnings before interest, income taxes, gain from early debt extinguishment, depreciation and amortization, excluding the impact of transaction-related costs incurred in connection with its May 2007 acquisition and other non-recurring or non-cash expenses, and normalizing occupancy costs for certain rent-related adjustments. The Company expects to report operating income for the 2011 first quarter in the range of $24 million to $26 million, compared to $27.6 million in the 2010 first quarter. At April 30, 2011, cash and cash equivalents were $246 million, including restricted cash of $26 million. The Company's Revolving Credit Facility continued to be undrawn following the March 2011 paydown from the proceeds of the Senior Secured Second Lien Notes. In addition, during the 2011 first quarter, the Company paid $24 million to retire $10 million of Senior Notes and $14 million of Senior Toggle Notes. About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores, Inc., also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. The Company's balance sheet at Oct. 30, 2010, showed $2.79 billion in total assets, $218.86 million in total current liabilities, $2.62 billion in long-term debt, and a stockholders' deficit of $47.89 million. Claire's Stores carries 'Caa2' corporate family and probability of default ratings, with 'positive' outlook, from Moody's Investors Service, and 'B-' issuer credit ratings, with 'stable' outlook, from Standard & Poor's. Moody's Investors Service in December 2010 upgraded Claire's Stores' ratings, including its Corporate Family Rating and Probability of Default Rating, to Caa2 from Caa3. The upgrade reflects a decrease in Claire's probability of default given that the company can now fully cover its interest expense. This is due to earnings improvement from solid comparable store sales growth, improved merchandise margins, and continued expense discipline. Claire's Caa2 Probability of Default Rating reflects Moody's view that although Claire's credit metrics have improved, they remain very weak as a result of its heavy debt load. For the twelve months ending Oct. 30, 2010, Claire's debt to EBITDA was very high at 9.3 times. CLEAN BURN: Has Access to Cape Fear Cash Collateral Until June 5 ---------------------------------------------------------------- The Hon. Thomas W. Waldrep, Jr., of the U.S. Bankruptcy Court for the Middle District of North Carolina authorized, on an interim basis, Clean Burn Fuels, LLC, to use Cape Fear Farm Credit, ACA's cash collateral until June 5, 2011. The Debtor would use the cash collateral to fund its Chapter 11 case, pay suppliers and other parties. The Court also ordered that no severance pay will be paid to Mr. Archer from the cash collateral. A hearing to consider final approval of the cash collateral use is scheduled for 10:00 a.m. on June 2, 2011, As reported in the Troubled Company Reporter on April 20, prepetition, the Debtor and Cape Fear Farm Credit, for itself and as agent/nominee for other lending institutions, entered into a Credit Agreement, wherein the Lender agreed to (i) lend to the Debtor up to $63 million in term loans for the construction of the Debtor's ethanol plant, and (ii) provide the Debtor with a $6 million revolving line of credit. The Debtor and Lender also entered into seven separate amendments to the Credit Agreement between November 2008 and August 2010. Pursuant to the Loan Documents, the Lender is owed approximately $66,006,639 plus interest and fees accrued as of the Petition Date secured by a first mortgage lien on the Plant and a security interest in other assets of the Debtor, including equipment, inventory, accounts, deposit accounts, general intangibles and the proceeds thereof. In exchange for using the cash collateral, the Debtor will provide the Lender with a continuing postpetition lien and security interest in all property and categories of property of the Debtor in which and of the same priority as the creditor held a similar, unavoidable lien as of the Petition Date, and the proceeds thereof. The Debtor will provide the Lender with an administrative expense claim to the extent the use of cash collateral, after application of the proceeds of the replacement collateral, results in a decrease in the value of the entity's interest in the property. The Debtor will also provide the Lender with financial reports for the Debtor in form and frequency reasonably acceptable to the Lender. 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. CLEAN BURN: Taps Smith, Anderson, as Special Counsel ---------------------------------------------------- Clean Burn Fuels, LLC, asks authority from the U.S. Bankruptcy Court for the Middle District of North Carolina to employ: SMITH, ANDERSON, BLOUNT, DORSETT, MITCHELL & JERNIGAN, LLP 2500 Wachovia Capitol Center Raleigh, North Carolina 27601 Tel: (919) 821-6682 E-mail: bkirkland@smithlaw.com as special counsel to assist the Debtor in its state court litigation matters, including various lawsuits pending in Hoke County, North Carolina. The firm will charge the Debtor based on the hourly rates of its professionals: Professionals Hourly Rates ------------- ------------ Byron B. Kirkland, Esq. $445 Wayne Mairano, Esq. $305 Matt $240 Designations Hourly Rates ------------ ------------ Lawyers $195-$545 Paralegals $170-$205 Byron B. Kirkland, at Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, LLP, assures the Court that the firm is a "disinterested person" within the meaning of section 101(14) of the Bankruptcy Code. 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. CLEAN BURN: LREMC Seeks Unsecured Creditors' Committee Membership ----------------------------------------------------------------- Creditor Lumbee River Electric Membership Corporation is asking the U.S. Bankruptcy Court for the Middle District of North Carolina to direct its inclusion to the Official Unsecured Creditors' Committee. In support of this Motion, LREMC states: 1. LREMC provided prepetition electric utility services to Debtor's premises. 2. LREMC holds one of the seven largest pre-petition claims against Debtor, in an amount exceeding $483,500 3. The Creditors Committee has four members at this time, pending creditor Buhler Aeroglide's motion to join. 4. LREMC desires to join the Creditors' Committee as the Committee's fifth (5th) or sixth (6th) member 5. LREMC's representative would be Mr. Daniel Lowry, Vice President of Finance. Mr. Lowry has an accounting degree and extensive experience in industrial-sector finance and accounting. 6. LREMC has consulted with each member of the Committee concerning its request and is informed that the Committee has voted unanimously to accept LREMC as a member of the committee. 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. CLEAN DIESEL: Posts $2.3 Million First Quarter Net Loss ------------------------------------------------------- Clean Diesel Technologies, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $2.32 million on $13.78 million of revenues for the three months ended March 31, 2011, compared with a net loss of $2.59 million on $12.45 million of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $31.08 million in total assets, $16.92 million in total liabilities, and stockholders' equity of $14.16 million. As reported in the TCR on April 11, 2011, KPMG LLP, in Los Angeles, Calif., expressed substantial doubt about Clean Diesel's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations and has an accumulated deficit. A complete text of the Form 10-Q is available for free at: http://is.gd/PkJVB9 Ventura, Calif.-based Clean Diesel Technologies, Inc. (NASDAQ: CDTI) -- http://www.cdti.com/-- is, as a result of the recent business combination with Catalytic Solutions, Inc., a vertically integrated global manufacturer and distributor of emissions control systems and products, focused on the heavy duty diesel (HDD) and light duty vehicle (LDV) markets. COLONIAL BANCGROUP: Court Rejects Liquidation Plan -------------------------------------------------- Patrick Fitzgerald, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Dwight H. Williams Jr. in a 13-page opinion on Friday rejected Colonial BancGroup Inc.'s Chapter 11 liquidation plan, saying it was "not in the best interest of creditors" and "fails to meet the 'best interest of creditors test,'". DBR relates Judge Williams agreed with argument by the Federal Deposit Insurance Corp. that Colonial's inclusion of a plan trustee and plan committee would likely be more expensive than if the bankruptcy estate was liquidated under a Chapter 7 trustee. The Plan proposes to pay off creditors by suing the Federal Deposit Insurance Corp. Creditors sought to recoup some $1.5 billion in funds the parent company transferred to its struggling banking subsidiary in the months before it was seized. DBR recounts that in a key ruling last fall, Judge Williams rejected the FDIC's bid to hold the holding company accountable for failing to maintain capital levels at the bank. The decision represented a setback for the FDIC in bankruptcy court, where the agency, as receiver, has sparred with a number of bank-holding companies that are under Chapter 11 protection because of hundreds of bank closures by regulators in recent years. The FDIC, however, said Judge Williams erred and appealed the ruling. According to DBR, the fight over capital commitments adds to other battles between the two over tax refunds estimated at $253 million, real-estate investment trust preferred securities worth $300 million, insurance and other assets. That litigation is pending in U.S. District Court in Montgomery. DBR says the fate of Colonial BancGroup's Chapter 11 case is unclear. Colonial BancGroup's attorney C. Edward Dobbs, Esq., a partner at Atlanta's Parker, Hudson, Rainer & Dobbs, declined to comment. In April, the FDIC had called for the case to be converted to a Chapter 7 liquidation. It later withdrew that request pending the outcome of the plan hearing. DBR notes that the FDIC had offered to settle the Colonial litigation. The offer involved a carve-out of some $63 million in disputed assets -- minus the fees and expenses racked up in the Chapter 11 case -- to be earmarked for the estate's unsecured creditors. But no deal was ever reached, and the FDIC withdrew its settlement offer earlier this month. According to DBR, whether the bankruptcy-court ruling will spur new discussions on a settlement remains to be seen. FDIC spokesman Andrew Gray couldn't immediately comment. 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. COLUMBUS COUNTRY CLUB: Meeting of Creditors on June 12 ------------------------------------------------------ The Dispatch reports that The Columbus Country Club filed for bankruptcy after cutbacks failed to offset economic setbacks. Although the club -- which is owned by 84 shareholders -- won't release how much it owes until after a creditors meeting June 12 at 11:30 a.m. in Aberdeen, Club President Kirk Hardy said the five largest creditors are banks, which have a lien on the property. The report relates that in 2010, the club owed more than $2 million to the banks, which included Cadence Bank for a loan to construct the club swimming pool. It also owed investors and members, who paid off $55,000 in back taxes. Despite cutting six jobs -- including that of its PGA-certified gold professional, Tom Riley -- and maintenance expenses by 35 percent, the club has continued to lose income as members have jumped ship. According to the report, the country club's total revenue drooped from $2.05 million in fiscal year 2008 to $1.04 million in 2010, according to club financial statements. During that same time frame, the club's net assets and fund balance dropped from $1.18 million to $504,425. Based in Columbus, Massachusetts, Columbus Country Club Inc. filed for Chapter 11 bankruptcy protection (Bankr. N.D. Miss. Case No. 11-12005) on May 3, 2011. Craig M. Geno, Esq., at Harris Jernigan & Geno, PLLC, represents the Debtor. The Debtor estimated assets and debts of between $1 million and $10 million. COMPREHENSIVE CARE: Reports $41,000 First Quarter Net Income ------------------------------------------------------------ Comprehensive Care Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income of $41,000 on $18.28 million of total revenues for the three months ended March 31, 2011, compared with a net loss of $2.23 million on $3.78 million of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $15.18 million in total assets, $21.39 million in total liabilities and a $6.21 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/GmqOTO About Comprehensive Care Tampa, Fla.-based Comprehensive Care Corporation provides managed care services in the behavioral health, substance abuse, and psychotropic pharmacy management fields. Mayer Hoffman McCann P.C., in Clearwater, Fla., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and has not generated sufficient cash flows from operations to fund its working capital requirements. The Company reported a net loss of $10.4 million on $35.2 million of revenues for 2010, compared with a net loss of $18.9 million on $14.2 million of revenues for 2009. CONQUEST PETROLEUM: Delays Filing First Quarter Form 10-Q --------------------------------------------------------- Conquest Petroleum Incorporated informed the U.S. Securities and Exchange Commission that it will be late in filing its quarterly report on Form 10-Q for the period ended March 31, 2011. The Company said the compilation, dissemination and review of the information required to be presented in the Form 10-Q has imposed time constraints that have rendered timely filing of the Form 10-Q impracticable without undue hardship and expense to the registrant. The Company undertakes the responsibility to file such annual report no later than five days after its original due date. About Conquest Petroleum Spring, Tex.-based Conquest Petroleum Incorporated (OTC BB: CQPT) -- http://www.conquestpetroleum.com/-- is an independent oil and natural gas company engaged in the production, acquisition and exploitation of oil and natural gas properties geographically focused on the onshore United States. The Company's operational focus is the acquisition, through the most cost effective means possible, of production or near production of oil and natural gas field assets. The Company's areas of operation include Louisiana and Kentucky. The Company reported a net loss of $14.49 million on $1.24 million of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $23.26 million on $914,781 of total revenues during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $2.66 million in total assets, $28.95 million in total liabilities, and a $26.29 million stockholders' deficit. As reported by the TCR on April 21, 2011, M&K CPAS, PLLC, in Houston, Texas, noted that Conquest Petroleum has insufficient working capital and reoccurring losses from operations, all of which raises substantial doubt about its ability to continue as a going concern. CONSTAR INT'L: Judge Approves Reorganization Plan ------------------------------------------------- Lance Duroni at Bankruptcy Law360 reports that U.S. Bankruptcy Judge Christopher S. Sontchi signed off on Constar International Inc.'s reorganization plan on Friday, capping off the Company's second stint in Chapter 11 in two years. Law360 relates that Judge Sontchi confirmed the plan, which will deleverage Constar's balance sheet by swapping new stock and debt for the $220 million of floating rate notes that comprise 95 percent of the debtors' capital structure. About Constar International Philadelphia, Pennsylvania-based Constar International Inc. -- http://www.constar.net/-- produces and supplies polyethylene terephthalate plastic containers for food and beverages. Constar filed for Chapter 11 protection in December 2008 (Bankr. D. Del. Lead Case No. 08-13432), with a pre-negotiated Chapter 11 plan. The plan, which reduced Constar's debt load by roughly $175 million, became effective on May 29, 2009. Attorneys at Bayard P.A., and Wilmer Cutler Pickering Hale and Dorr LLP represented the Debtor in the case. Due to operating losses caused by a significant decline in demand for its products from Pepsi-Cola Advertising and Marketing Inc. and other customers, Constar and its affiliates returned to Chapter 11 protection on Jan. 11, 2011 (Bankr. D. Del. Case No. 11-10109), with a Chapter 11 plan negotiated with holders of 75% of the holders of $220 million in senior secured floating-rate notes. Andrew Goldman, Esq., and Dennis Jenkins, Esq., at Wilmer Cutler Pickering Hale and Dorr LLP, serve as the Debtors' general bankruptcy counsel. Jamie Lynne Edmonson, Esq., and Neil B. Glassman, Esq., at Bayard, P.A., serve as co-counsel to the Debtors. PricewaterhouseCoopers serves as the Debtors' independent auditors and accountants. Kurtzman Carson Consultants LLC serves as the Debtors' claims agent. The Debtors disclosed $418 million in total assets and $414 million in total debts as of Sept. 30, 2010. Constar filed for Chapter 11 protection with a pre-arranged debt-for-equity exchange, expected to be completed by mid-2011. The Company and holders of more than 75% of its senior secured floating- rate notes agreed on a restructuring plan that would reduce debt by as much as $150 million. CONSTAR INT'L: Wins Confirmation of Prepackaged Plan ---------------------------------------------------- Jacqueline Palank, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Christopher S. Sontchi confirmed Constar International Inc.'s Chapter 11 plan of reorganization at a hearing Friday. A Constar representative didn't return a call seeking comment Monday. On March 14, 2011, Constar submitted a first amended iteration of the Disclosure Statement and the Joint Plan of Reorganization. Copies of the documents are available for free at: http://bankrupt.com/misc/constar.noticeofDSmodifications.pdf According to the Disclosure Statement, the Reorganized Debtors will emerge with approximately 60% less funded debt. DBR recounts the salient terms of the prepackaged plan: -- Noteholders, which have an allowed secured claim of $100 million, will receive $70 million in new notes due 2017 as well as new shares of convertible preferred stock. -- $121.4 million of Noteholders' claims will be classified as unsecured. They'll join Constar's other unsecured creditors in sharing in 100% of the new common stock in the company. -- Constar's existing equity will be canceled, and holders won't recover anything. -- Lenders behind Constar's $55 million bankruptcy financing package, led by Black Diamond Commercial Finance LLC, will receive some cash and may then choose to roll $15 million of their claims over into new term loans and new notes. -- General Electric Capital Corp. and the other lenders who provided Constar with a $75 million secured credit facility before its bankruptcy will be paid in full and in cash on their $30.2 million in allowed claims. -- To fund Constar's emergence from bankruptcy, Wells Fargo Capital Finance LLC will lead a lender group that will provide the company with a $60 million exit loan. About Constar International Philadelphia, Pennsylvania-based Constar International Inc. -- http://www.constar.net/-- produces and supplies polyethylene terephthalate plastic containers for food and beverages. Constar filed for Chapter 11 protection in December 2008 (Bankr. D. Del. Lead Case No. 08-13432), with a pre-negotiated Chapter 11 plan. The plan, which reduced Constar's debt load by roughly $175 million, became effective on May 29, 2009. Attorneys at Bayard P.A., and Wilmer Cutler Pickering Hale and Dorr LLP represented the Debtor in the case. Due to operating losses caused by a significant decline in demand for its products from Pepsi-Cola Advertising and Marketing Inc. and other customers, Constar and its affiliates returned to Chapter 11 protection on Jan. 11, 2011 (Bankr. D. Del. Case No. 11-10109), with a Chapter 11 plan negotiated with holders of 75% of the holders of $220 million in senior secured floating-rate notes. Andrew Goldman, Esq., and Dennis Jenkins, Esq., at Wilmer Cutler Pickering Hale and Dorr LLP, serve as the Debtors' general bankruptcy counsel. Jamie Lynne Edmonson, Esq., and Neil B. Glassman, Esq., at Bayard, P.A., serve as co-counsel to the Debtors. PricewaterhouseCoopers serves as the Debtors' independent auditors and accountants. Kurtzman Carson Consultants LLC serves as the Debtors' claims agent. The Debtors disclosed $418 million in total assets and $414 million in total debts as of Sept. 30, 2010. Constar filed for Chapter 11 protection with a pre-arranged debt-for-equity exchange, expected to be completed by mid-2011. The Company and holders of more than 75% of its senior secured floating- rate notes agreed on a restructuring plan that would reduce debt by as much as $150 million. CORD BLOOD: Delays Filing of First Quarter Form 10-Q ---------------------------------------------------- Cord Blood America, Inc., notified the U.S. Securities and Exchange Commission that it will be late in filing its quarterly report on Form 10-Q for the period ended March 31, 2011. The Company said the compilation, dissemination and review of the information required to be presented in the Form 10-Q for the relevant period has imposed time constraints that have rendered timely filing of the Form 10-Q impracticable without undue hardship and expense to the registrant. The Company undertakes the responsibility to file such report no later than five days after its original prescribed due date. About Cord Blood America Based in Las Vegas, Nevada, Cord Blood America, Inc., is primarily a holding company whose subsidiaries include Cord Partners, Inc., CorCell Co. Inc., CorCell Ltd.; CBA Professional Services, Inc. D/B/A BodyCells, Inc.; CBA Properties, Inc.; and Career Channel Inc, D/B/A Rainmakers International. Cord specializes in providing private cord blood stem cell preservation services to families. BodyCells is a developmental stage company and intends to be in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy. Properties was formed to hold the corporate trademarks and other intellectual property of CBAI. Rain specializes in creating direct response television and radio advertising campaigns, including media placement and commercial production. The Company reported a net loss attributable to Cord Blood America of $8.09 million on $4.13 million of revenue for the year ended Dec. 31, 2010, compared with a net loss attributable to Cord Blood of $9.77 million on $3.24 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $7.38 million in total assets, $6.63 million in total liabilities and $746,293 in total stockholders' equity. As reported by the TCR on April 5, 2011, Rose, Snyder & Jacobs, in Encino, Calif., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has sustained recurring operating losses, continues to consume cash in operating activities, and has insufficient working capital and an accumulated deficit at Dec. 31, 2010. CORNERSTONE BANCSHARES: Files Form 10-Q; Posts $252,275 Income -------------------------------------------------------------- Cornerstone Bancshares, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income of $252,275 on $5.21 million of total interest income for the three months ended March 31, 2011, compared with net income of $343,787 on $7.10 million of total interest income for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $447.54 million in total assets, $420.25 million in total liabilities, and $27.29 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at:' http://is.gd/d199cT About Cornerstone Bancshares Chattanooga, Tenn.-based Cornerstone Bancshares, Inc. is a bank holding company. Its wholly-owned subsidiary, Cornerstone Community Bank, is a Tennessee-chartered commercial bank with five full-service banking offices located in Hamilton County, Tennessee. The Company reported a net loss of $4.71 million on $25.21 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $8.17 million on $26.31 million of total interest income during the prior year. Consent Order The Company disclosed in 10-Q for the quarter ended June 30, 2010, that following the issuance of a written report by the Federal Deposit Insurance Corporation and the Tennessee Department of Financial Institutions concerning their joint examination of Cornerstone Community Bank in October 2009, the Bank entered a consent order with the FDIC on April 2, 2010, and a written agreement with the TDFI on April 8, 2010, each concerning areas of the Bank's operations identified in the report as warranting improvement and presenting substantially similar plans for making those improvements. The consent order and written agreement, which the Company collectively refers to as the "Action Plans", convey specific actions needed to address certain findings from the joint examination and to address the Company's current financial condition. The Action Plans contain a list of strict requirements ranging from a capital directive, which requires the Company to achieve and maintain minimum regulatory capital levels in excess of the statutory minimums to be well-capitalized, to developing a liquidity risk management and contingency funding plan, in connection with which the Company will be subject to limitations on the maximum interest rates it can pay on deposit accounts. The Action Plans also contain restrictions on future extensions of credit and requires the development of various programs and procedures to improve the Company's asset quality as well as routine reporting on its progress toward compliance with the Action Plans to the Board of Directors, the FDIC and the TDFI. As of April 2, 2010, the date of the Action Plans, the Bank was deemed to be "adequately capitalized." CP JFK LLC: Ch. 11 Trustee Can Sell Hotel Property for $13.8-Mil. ----------------------------------------------------------------- The Hon. Carla E. Craig of the U.S. Bankruptcy Court for the Eastern District of New York authorized Alan Nisselson, Chapter 11 trustee for the estate of CP JFK, LLC, to sell the hotel property to Neshgold, LP, $13,850,000. Neshgold credit bid its allowed secured claim up of $14,500,000 for the operating hotel located at 151-20 Baisley Boulevard, Jamaica, New York, and the ground lease for the hotel premises. The trustee determined the Neshgold bid as the highest or best offer for the hotel property, and the offer of Wells Street Capital IV, LLC as the second highest or best offer for the hotel property. The sale is free and clear of all liens, claims and encumbrances. Optimum Hotel Brokerage assisted the the trustee in the marketing efforts. The purchaser, upon closing, will pay to the trustee, by way of credit against Neshgold's first priority mortgage, the sum of $13,850,000 representing the full amount of the best offer well as the $510,000 enhanced carve out. The trustee is represented by: WINDELS MARX LANE & MITTENDORF, LLP Alan Nisselson, Esq. Howard L. Simon, Esq. 156 West 56th Street New York, NY 10019 Tel: (212) 237-1000 E-mail: hsimon@windelsmarx.com anisselson@windelsmarx.com About CPJFK LLC Atlanta, Georgia-based CPJFK, LLC, owns and operates a 183 room hotel under the name of the JFK Plaza Hotel located at 151-20 Baisley Blvd., in Jamaica, New York. The Hotel operations constitute the Debtor's sole source of income. The Debtor filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ga. Case No. 10-89928) on Oct. 4, 2010. On Oct. 19, 2010, the U.S. Trustee for Region 21 filed a motion to transfer the Debtor's case to the U.S. Bankruptcy Court for the Eastern District of New York. On Nov. 9, 2010, the Debtor's case was transferred to E.D.N.Y. and assigned Case No. 10-50566. In November 2010, the Bankruptcy Court order the appointment of a Chapter 11 trustee at the behest of Neshgold, LP. The U.S. Trustee appointed Alan Nisselson as chapter 11 Trustee. Alan Nisselson selected Choice Consultants LLC as his managing agent. No official committee of unsecured creditors has been appointed in the case. CROWNE PLAZA: Lender Wants Dismissal or Ch. 11 Trustee ------------------------------------------------------ Luci Scott at the Arizona Republic reports that the lender to Chandler's Crowne Plaza San Marcos Golf Resort has accused the resort's general manager of harming value of the resort by improperly transferring real estate owned by the resort to the general partner. The transfer was made about six months before the owners filed for bankruptcy protection, Guaranty Bank and Trust Co. alleges in court papers. Losing the real estate, known as the Bogle house, will hurt the chances of getting an optimum price in a sale of the resort, the bank said. Guaranty's foreclosure proceedings stalled when the resort filed bankruptcy earlier this year. Sean O'Brien of Phoenix, an attorney for the resort's owners, denied wrongdoing by his clients. Guaranty Bank and Trust is asking the court to dismiss the Chapter 11 bankruptcy filing, convert it to Chapter 7, or appoint a trustee "because it is in the best interest of debtor's creditors and equity security holders." The bank alleges "fraud, dishonesty and gross mismanagement of the estate by (the resort's) principals." A court hearing is set for June 6. About San Marcos Capital San Marcos Capital Partners, LP, owns the Crowne Plaza San Marcos Golf Resort in downtown Chandler, Arizona. It filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 11-07144) on March 18, 2011. Duncan E. Barber, Esq., at Bieging Shapiro & Burrus, LLP, in Denver, Colorado, serves as counsel to the Debtor. The Debtor estimated assets of up to $50,000 and debts of up to $50,000,000 as of the Chapter 11 filing. CUMULUS MEDIA: Reports $16.1-Mil. First Quarter Net Income ---------------------------------------------------------- Cumulus Media Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting net income of $16.12 million on $57.85 million of net revenues for the three months ended March 31, 2011, compared with a net loss of $144,000 on $56.35 million of net revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $318.87 million in total assets, $643.27 million in total liabilities, and a $324.40 million total stockholders' deficit. Lew Dickey, Chairman & CEO stated, "During the first quarter, we announced two very important transactions for our shareholders. With the acquisition of CMP and Citadel, we are transforming our company into a true national platform that is broadly diversified with scale. The pro forma entity will have a strong balance sheet with ample liquidity that will generate enormous free cash flow. We look forward to combining these entities into a fully- integrated asset base that will provide numerous opportunities to create value through both content and distribution." A full-text copy of the Form 10-Q is available for free at: http://is.gd/yfkAGH About Cumulus Media Based in Atlanta, Georgia, Cumulus Media Inc. (NASDAQ: CMLS) -- http://www.cumulus.com/-- is the second largest radio broadcaster in the United States based on station count, controlling 350 radio stations in 68 U.S. media markets. In combination with its affiliate, Cumulus Media Partners, LLC, the Company believes it is the fourth largest radio broadcast company in the United States when based on net revenues. Standard & Poor's Ratings Services said April it raised its corporate credit rating on Atlanta-based Cumulus Media Inc. to 'B' from 'B-'. "The rating remains on CreditWatch, where we placed it with positive implications Feb. 18, 2011," S&P stated. Moody's Investors Service in April upgraded Cumulus Media's Corporate Family Rating to B1 from Caa1 due to the company's pending acquisition of CMP Susquehanna Corp. in the second quarter of 2011 followed by the announced $2.4 billion acquisition of Citadel Broadcasting Corporation later this year. CUMULUS MEDIA: Prices $610 Million 7.75% Senior Notes Offering -------------------------------------------------------------- Cumulus Media Inc. has priced its previously announced offering of $610.0 million aggregate principal amount of 7.75% senior notes due 2019. The sale of the Notes is expected to be completed on May 13, 2011, subject to customary closing conditions. As a part of its refinancing transactions in connection with its pending acquisitions of Cumulus Media Partners, LLC, and Citadel Broadcasting Corporation, the Company intends to use the net proceeds from the offering of Notes to (i) repay in full all outstanding amounts under the term loan facility under the Company's existing senior secured credit facilities and (ii) pay fees and expenses related to the offering of Notes. Any remaining proceeds will be used for general corporate purposes. The Notes and the related guarantees have not been, and will not be, registered under the Act or the securities laws of any other place and may not be offered or sold in the United States absent registration or an applicable exemption therefrom. The Notes will be offered only to qualified institutional buyers under Rule 144A and to persons outside the United States under Regulation S. About Cumulus Media Based in Atlanta, Georgia, Cumulus Media Inc. (NASDAQ: CMLS) -- http://www.cumulus.com/-- is the second largest radio broadcaster in the United States based on station count, controlling 350 radio stations in 68 U.S. media markets. In combination with its affiliate, Cumulus Media Partners, LLC, the Company believes it is the fourth largest radio broadcast company in the United States when based on net revenues. The Company's balance sheet at March 31, 2011, showed $318.87 million in total assets, $643.27 million in total liabilities, and a $324.40 million total stockholders' deficit. * * * Standard & Poor's Ratings Services said April it raised its corporate credit rating on Atlanta-based Cumulus Media Inc. to 'B' from 'B-'. "The rating remains on CreditWatch, where we placed it with positive implications Feb. 18, 2011," S&P stated. Moody's Investors Service in April upgraded Cumulus Media's Corporate Family Rating to B1 from Caa1 due to the company's pending acquisition of CMP Susquehanna Corp. in the second quarter of 2011 followed by the announced $2.4 billion acquisition of Citadel Broadcasting Corporation later this year. DBSD N.A.: Court Approves Disclosure Statement ---------------------------------------------- Joseph Checkler, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Robert E. Gerber approved the disclosure statement explaining DBSD North America Inc.'s Chapter 11 plan, which calls the $1.4 billion sale of the Company to Charles Ergen's Dish Network Corp. DBR notes that Judge Gerber in March had called the plan "very, very favorable to the creditor community." DBR further recounts that when asked by Judge Gerber if he expected any creditor objections to the deal down the road, Kirkland & Ellis LLP's Ryan Bennett, a lawyer for DBSD said, "We don't, your honor." DBSD hopes to have its bankruptcy plan confirmed by the court on June 30. About DBSD North America Headquartered in Reston, Virginia, DBSD North America Inc., aka ICO Member Services Inc., offers satellite communications services. It has launched a satellite, but is in the developmental stages of creating a satellite system with components in space and on earth. It presently has no revenues. The Company and nine of its affiliates filed for Chapter 11 protection on May 15, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-13061). James H.M. Sprayregen, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, in New York; and Marc J. Carmel, Esq., and Sienna R. Singer, Esq., at Kirkland & Ellis LLP, in Chicago, serve as the Debtors' counsel. Jefferies & Company is the financial advisors to the Debtors. The Garden City Group Inc. is the claims agent for the Debtors. DBSD estimated assets and debts of $500 million to $1 billion in its Chapter 11 petition. Timothy A. Barnes, Esq., and Steven J. Reisman, Esq., at Curtis, Mallet-Prevost, Colt & Mosle LLP, in New York, represent the Official Committee of Unsecured Creditors. The ad hoc committee of certain parties that hold or manage holdings of those certain 7.5% Convertible Senior Secured Notes due 2009 issued by DBSD is represented by Dennis F. Dunne, Esq., Risa M. Rosenberg, Esq., and Jeremy S. Sussman, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York; and Andrew M. Leblanc, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Washington, DC. Sprint Nextel is represented by Eric Moser, Esq., at K&L Gates LLP, in New York; and John H. Culver III, Esq., and Felton E. Parrish, Esq., at K&L Gates LLP, in Charlotte, North Carolina. DISH is represented in the case by J. Eric Ivester, Esq., at Skadden Arps Slate Meagher & Flom LLP, in New York. DEARBORN BANCORP: Reports $154,000 First Quarter Net Income ----------------------------------------------------------- Dearborn Bancorp, Inc., filed its quarterly report on Form 10-Q, reporting net income of $154,000 on $8.6 million of net interest income for the three months ended March 31, 2011, compared with net income of $1.1 million on $8.1 million of net interest income for the same period last year. The Company's balance sheet at March 31, 2011, showed $897.0 million in total assets, $870.0 million in total liabilities, and stockholders' equity of $27 million. "The Bank is currently undercapitalized," the Company said in the filing. "Failure to meet the minimum ratios set forth in the Consent Order could result in regulators taking additional enforcement action against the Company." As reported in the TCR on March 28, 2011, BKD, LLP, in Indianapolis, Indiana, expressed substantial doubt about Dearborn Bancorp ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses resulting from the effects of the economic downturn in their operating region causing its subsidiary bank to be undercapitalized and resulting in a consent order to be issued by its primary regulator. A complete text of the Form 10-Q is available for free at: http://is.gd/uv3wOR Dearborn, Michigan-based Dearborn Bancorp, Inc. (Nasdaq: DEAR) is a registered bank holding company. Its sole banking subsidiary is Fidelity Bank. The Bank currently operates 17 banking offices in Wayne, Oakland, Macomb and Washtenaw Counties in the State of Michigan. DPAC TECHNOLOGIES: Posts $191,000 First Quarter Net Loss -------------------------------------------------------- DPAC Technologies Corp. filed its quarterly report on Form 10-Q, reporting a net loss of $191,036 on $2.0 million of sales for the three months ended March 31, 2011, compared with a net loss of $95,820 on $1.8 million of sales for the same period of 2010. The Company's balance sheet as of March 31, 2011, showed $9.4 million in total assets, $6.9 million in total liabilities, and stockholders' equity of $2.5 million. Maloney + Novotny in Cleveland, Ohio, expressed substantial doubt about DPAC Technologies' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that of the Company's continued operating losses, deficit working capital balances and the inherent risk in extending or refinancing its bank line of credit, which matures on May 31, 2011. A full-text copy of the Form 10-Q is available for free at: http://is.gd/iFc6iH Hudson, Ohio-based DPAC Technologies Corp. (OTC QB: DPAC) -- http://www.quatech.com/-- through its wholly owned subsidiary, Quatech, Inc., designs, manufactures, and sells device connectivity and device networking solutions for a broad market. Quatech sells its products through a global network of distributors, system integrators, value added resellers, and original equipment manufacturers. The Company sells to customers in both domestic and foreign markets. EASTERN LIVESTOCK: Lease Decision Deadline Extended to July 26 -------------------------------------------------------------- Judge Basil H. Lorch III has extended the deadline for Eastern Livestock Co., LLC, to assume or reject non-residential real property leases pursuant to Section 365(d)(4)(B) of the Bankruptcy Code, through and including July 26, 2011. James M. Knauer, in his capacity as Chapter 11 trustee of Eastern Livestock, sought the extension. About Eastern Livestock Eastern Livestock Co., LLC, was one of the largest cattle brokerage companies in the United States, with operations and assets located in at least 11 states. ELC was headquartered in New Albany, Indiana, with branch locations across several states. It shut operations in November 2010. On Dec. 6, 2010, creditors David L. Rings, Southeast Livestock Exchange, LLC, and Moseley Cattle Auction, LLC, filed an involuntary Chapter 11 petition (Bankr. S.D. Ind. Case No. 10- 93904) for the Company. The creditors asserted $1.45 million in claims for "cattle sold," and are represented by Greenebaum Doll & McDonald PLLC. The Court entered an Order for Relief on Dec. 28, 2010. Judge Basil H. Lorch III, at the behest of the creditors, appointed a trustee to operate Eastern Livestock's business. The Chapter 11 trustee has tapped James M. Carr, Esq., at Baker & Daniels LLP, as counsel. BMC Group Inc. is the claims and notice agent. The Debtor has disclosed $81,237,865 in assets and $40,154,698 in papers filed in Court. An affiliate, East-West Trucking Co., LLC, filed a Chapter 7 petition (Bankr. S.D. Ind. Case No. 10-93799) on Nov. 23, 2010, estimating assets and debts of $1 million to $10 million. The petition was signed by Thomas P. Gibson, as manager. Michael J. Walro, appointed as Chapter 7 Trustee for East-West Trucking, has tapped James T. Young, Esq., at Rubin & Levin, P.C., in Indianapolis -- james@rubin-levin.net -- as counsel. Mr. Gibson, together with his spouse, Patsy M. Gibson, pursued a personal bankruptcy case (Bankr. S.D. Ind. Case No. 10-93867) in 2010. Kathryn L. Pry, the court-appointed trustee for the Gibson's Chapter 7 case, has tapped Dale & Eke, P.C., as counsel. EASTMAN KODAK: 14 Directors Elected at Annual Meeting ----------------------------------------------------- The 2011 Annual Meeting of Shareholders of Eastman Kodak Company was held on May 11, 2011, at the Hilton Garden Inn, 6450 Carlsbad Road, Carlsbad, California 92011. The Company filed its definitive Proxy Statement for the proposals voted upon at the Annual Meeting with the Securities and Exchange Commission on March 31, 2011. As of March 14, 2011, the record date for the Annual Meeting, there were 269,038,172 shares of common stock issued and outstanding. A quorum of 188,670,361 shares of common stock was present or represented at the Annual Meeting. At the 2011 Annual Meeting, Shareholders: (a) elected each of the Company's fourteen nominees for director to serve a term of one year to expire at the 2012 Annual Meeting of Shareholders or until their successors are duly elected and qualified: (1) Richard S. Braddock (2) Herald Y. Chen (3) Adam H. Clammer (4) Timothy M. Donahue (5) Michael J. Hawley (6) William H. Hernandez (7) Douglas R. Lebda (8) Kyle P. Legg (9) Delano E. Lewis (10) William G. Parrett (11) Antonio M. Perez (12) Joel Seligman (13) Dennis F. Strigl (14) Laura D'Andrea Tyson; (b) ratified the selection of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm; (c) approved, through an advisory vote, the compensation of the Company's Named Executive Officers; (d) approved, through an advisory vote, an annual frequency for the advisory vote on compensation of the Company's Named Executive Officers; and (e) did not approve a shareholder proposal raised from the floor by First Affirmative Financial Network LLC, concerning the Company's relationship with the U.S. Chamber of Commerce. About Eastman Kodak Headquartered in Rochester, New York, Eastman Kodak Company (NYSE:EK) -- http://www.kodak.com/-- provides imaging technology products and services to the photographic and graphic communications markets. The Company's balance sheet at March 31, 2011, showed $5.88 billion in total assets, $7.15 billion in total liabilities, and a $1.27 billion total deficit. * * * As reported by the Troubled Company Reporter on March 2, 2011, Standard & Poor's Ratings Services lowered its corporate credit rating on Eastman Kodak to 'CCC' from 'B-'. S&P removed the rating from CreditWatch, where S&P placed it with negative implications on Jan. 26, 2011. The rating outlook is negative. Issue-level ratings on the company's debt were also lowered and removed from CreditWatch in conjunction with the corporate credit rating change. The 'CCC' corporate credit rating reflects S&P's expectation that Eastman Kodak's pace of cash consumption will remain high over the near term. It also reflects S&P's expectation of continued secular volume decline of the traditional photographic products and services business, that the company's consumer digital imaging businesses will not quickly turn convincingly profitable, and that intellectual property earnings, which constitute a significant portion of the company's EBITDA, could decline significantly from 2010 levels. These factors underpin S&P's view of Kodak's business risk as vulnerable and support S&P's view that revenue and EBITDA will decline in 2011. S&P views the company's financial risk profile as highly leveraged because of the risk that its earnings and cash flow could become insufficient to support its debt. In the March 16, 2011 edition of the TCR, Fitch Ratings has affirmed its 'CCC' Issuer Default Rating on Kodak. The ratings and Negative Outlook reflect Kodak's continued struggles to gain traction in its digital businesses as secular declines persist and broaden to entertainment film within the traditional film business. EAU TECHNOLOGIES: Incurs $700,830 First Quarter Net Loss -------------------------------------------------------- EAU Technologies, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $700,830 on $630,642 of total revenues for the three months ended March 31, 2011, compared with a net loss of $223,271 on $162,402 of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $2.38 million in total assets, $7.12 million in total liabilities, all current, and a $4.74 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/he5RzD About EAU Technologies Kennesaw, Ga.-base EAU Technologies, Inc., is in the business of developing, manufacturing and marketing equipment that uses water electrolysis to create non-toxic cleaning and disinfecting fluids for food safety applications as well as dairy drinking water. As reported by the TCR on April 7, 2011, HJ & Associates, LLC, in Salt Lake City, Utah, expressed substantial doubt about EAU Technologies' ability to continue as a going concern following the Company's 2010 results. The independent auditors noted that the Company has a working capital deficit as well as a deficit in stockholders equity. The Company reported net income of $2.4 million on $697,555 of revenues for 2010, compared with a net loss of $2.2 million on $724,510 of revenues for 2009. ENEA SQUARE: Has Until June 15 to Use NUCP FUND's Cash Collateral ----------------------------------------------------------------- The Hon. Roger L. Efremsky of the U.S. Bankruptcy Court for the Northern District of California authorized Enea Square Partners, L.P., to use all of the cash collateral of secured lender, NUCP FUND, I, LLC, until June 15, 2011. The Debtor is the owner of commercial property including 11 parcels located at 1450 Enea Circle, 1486 Enea Court, 1470 Enea Circle, 1465 Enea Circle D, and 1465 Enea Circle E, Concord, California. The Debtor related that the original lender of the property was Comerica Bank, then Comerica sells the Debtor's debt to NUCP FUND I, LLC. The secured lender asserts a claim amounting to $19,500,000. The Debtor will use $54,600 in cash collateral to make these payments: Joan Enea-Lopez, managing member $12,000 and attorney at law David Enea, on-site maintenance $6,000 Judy Ewing, secretary $4,200 Mimi Enea $3,200 Molly Enea $2,000 Thereafter, the Debtor will need to use cash collateral in order to pay the monthly operating expenses. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the lenders a security interest in postpetition assets generally the same type and character as its prepetition lien. A continued hearing is set for June 15, 2011 at 2:00 p.m., to consider the Debtor's request to access the cash collateral. The Debtor is represented by: Eric A. Nyberg, Esq. Charles N. Bendes, Esq. Chris D. Kuhner, Esq. KORNFIELD, NYBERG, BENDES & KUHNER, P.C. 1970 Broadway, Suite 225 Oakland, CA 94612 Tel: (510) 763-1000 About Enea Square Partners Concord, California-based, Enea Square Partners, LP filed for Chapter 11 protection (Bankr. N.D. Calif. Case No. 11-44888) on May 4, 2011. Bankruptcy Judge Roger L. Efremsky presides over the case. The Debtor estimated assets and debts at $10 million to $50 million. EVERGREEN TRANS: Reorganization Case Converted to Liquidation ------------------------------------------------------------- The Hon. Margaret A. Mahoney of the U.S. Bankruptcy Court for the Southern District of Alabama converted the Chapter 11 case of Evergreen Transportation, Inc., to one under Chapter 7 of the Bankruptcy Code. As reported in the Troubled Company Reporter on April 1, 2011, Travis M. Bedsole, Jr., bankruptcy administrator, asked for the dismissal of the Debtor's case, or, in the alternative, conversion of the case to Chapter 7 because the Debtor failed to propose a plan of reorganization, and has no ability to effectuate a plan of reorganization. The Court also appointed Lynn Harwell Andrews as interim trustee in the case. The trustee's standing bond will be fixed under the general blanket bond previously approved. In a separate filing, the Debtor asked for an additional 30 days to file its new schedules of assets and liabilities and statement of financial affairs and matrix. The Debtor explained that Roger Ross of Ross Consulting Services needs additional time to prepare the necessary documents. About Evergreen Transportation Evergreen, Alabama-based Evergreen Transportation, Inc., operates a freight and logistics business. The Company filed for Chapter 11 (Bankr. S.D. Ala. Case No. 09-13525) on Aug. 4, 2009. Silver, Voit & Thompson, Attorneys at Law, P.C. represents the Debtor in its restructuring efforts. Ross Consulting Services, LLC, and Carriage Hill Partners, Ltd., have been tapped as financial advisors. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million as of the Chapter 11 filing. EZENIA! INC: Incurs $784,000 Net Loss in March 31 Quarter --------------------------------------------------------- Ezenia! Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $784,000 on $676,000 of product revenues for the three months ended March 31, 2011, compared with a net loss of $743,000 on $703,000 of product revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $3.2 million in total assets, $3.3 million in total liabilities, and a stockholders' deficit of $92,000. As reported in the TCR on April 11, 2011, McGladrey & Pullen, LLP, in Boston, Mass., expressed substantial doubt about Ezenia! Inc.'s ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has had recurring losses, and negative cash flows from operations and has limited existing resources available to meet 2011 commitments. A complete text of the Form 10-Q is available for free at: http://is.gd/smdYxk Nashua, New Hampshire-based Ezenia! Inc. (OTC BB: EZEN) -- http://www.ezenia.com/-- develops and markets products that enable organizations to provide technically advanced high-quality group communication to commercial, governmental, consumer and institutional users. FENTURA FINANCIAL: Files Form 10-Q; Posts $310,000 Q1 Net Income ---------------------------------------------------------------- Fentura Financial, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting net income of $310,000 on $3.35 million of total interest income for the three months ended March 31, 2011, compared with a net loss of $483,000 on $3.93 million of total interest income for the same period 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 shareholders' equity. A full-text copy of the Form 10-Q is available for free at:'' http://is.gd/wM9nBB 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. FIRST SECURITY: Incurs $2.65-Mil. First Quarter Net Loss -------------------------------------------------------- First Security Group, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $2.65 million on $11.50 million of total interest income for the three months ended March 31, 2011, compared with a net loss of $1.11 million on $15.04 million of total interest income for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.11 billion in total assets, $1.02 billion in total liabilities and $90.14 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/ZiZ4Xj About First Security Group First Security Group, Inc., is a bank holding company headquartered in Chattanooga, Tennessee, with $1.2 billion in assets as of Sept. 30, 2010. Founded in 1999, First Security's community bank subsidiary, FSGBank, N.A., has 37 full- service banking offices, including the headquarters, along the interstate corridors of eastern and middle Tennessee and northern Georgia and 325 full-time equivalent employees. In Dalton, Georgia, FSGBank operates under the name of Dalton Whitfield Bank; along the Interstate 40 corridor in Tennessee, FSGBank operates under the name of Jackson Bank & Trust. On Sept. 7, 2010, the Company entered into a Written Agreement with the Federal Reserve Bank of Atlanta, the Company's primary regulator, which prohibits the Company from declaring or paying dividends without prior written consent of the Federal Reserve. The Company is also prohibited from taking dividends, or any other form of payment representing a reduction of capital, from the Bank without prior written consent. The Company is also required, within 60 days of the Agreement, to submit to the Federal Reserve a written plan designed to maintain sufficient capital at the Company and the Bank. On April 28, 2010, FSGBank, the Company's wholly-owned subsidiary, consented and agreed to the issuance of a Consent Order by the Office of the Comptroller of the Currency (OCC). Pursuant to that Consent Order, within 120 days of the effective date of the Order, the Bank is required to achieve and thereafter maintain total capital at least equal to 13% of risk-weighted assets and Tier 1 capital at least equal to 9% of adjusted total assets. As of Sept. 30, 2010, the first financial reporting period subsequent to the 120 day requirement, the Bank's total capital to risk-weighted assets was 12.93% and the Tier 1 capital to adjusted total assets was 7.43%. The Bank has notified the OCC of the non-compliance. The Company reported a net loss of $44.34 million on $54.91 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $33.45 million on $64.00 million of total interest income during the prior year. Joseph Decosimo and Company, PLLC, in Chattanooga, Tennessee, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred losses from operations for the past two years. The Company is also operating under formal supervisory agreements with the Federal Reserve Bank of Atlanta and the Office of the Comptroller of the Currency and is not in compliance with all provisions of the Agreements. Failure to achieve all of the Agreements' requirements may lead to additional regulatory actions. FISHER ISLAND: Bond Not Filed to Support Involuntary ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the owner of a development on Fisher Island, Florida, may soon be out from underneath the cloud of an involuntary bankruptcy petition. After the involuntary Chapter 11 petition was filed in March, the developer filed a motion which the bankruptcy court in Miami granted on April 21 requiring the petitioners to file a $200,000 bond by the next day. The bond hasn't been filed, the resort developer said in a motion. The motion seeks to have the petitioning creditors held in contempt for failing to post the bond. The bond was designed by the bankruptcy judge to cover the owner's costs and attorneys' fees it would be entitled to recover if the involuntary petition were dismissed. About Fisher Island Solby+Westbrae Partners; 19 SHC, Corp.; Ajna Brands, Inc.; 601/1700 NBC, LLC; Axafina, Inc.; and Oxana Adler, LLM, filed an involuntary Chapter 11 petition against Miami Beach, Florida-based Fisher Island Investments, Inc. (Bankr. S.D. Fla. Case No. 11- 17047) on March 17, 2011. On the same date, involuntary Chapter 11 petitions were also filed against the Company's affiliates, Mutual Benefits Offshore Fund, LTD (Bankr. S.D. Fla. Case No. 11-17051) and Little Rest Twelve, Inc. (Bankr. S.D. Fla. Case No. 11-17061). Judge A. Jay Cristol directed the appointment of an examiner to probe the ownership issues plaguing Fisher Island, which has seen two sets of purported owners square off over an involuntary Chapter 11 filing. The U.S. Trustee named James S. Feltman as examiner. GAS CITY: Has Continued Access to Bank of America Cash Collateral ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois approved, according to Gas City Ltd., et al.'s docket, a stipulation authorizing the continued use of the cash collateral of its prepetition secured lender -- Bank of America, N.A. The prepetition secured lender consented to an extension of the Debtors use of the cash collateral to fund their Chapter 11 case, pay suppliers and other parties. As reported in the Troubled Company Reporter on Nov. 5, 2010, prior to the commencement of the Chapter 11 Case, the prepetition secured lender, made certain loans and other financial accommodations to the Debtors pursuant to (i) the Feb. 1, 2005, Loan Agreement, and (ii) the Dec. 7, 2009 Loan Agreement. As of the Petition Date, the Debtors was indebted under the Prepetition Credit Agreements in the approximate principal amount of $29.6 million, plus interest accrued and accruing, costs, expenses, fees their charges and other obligations. As adequate protection for any diminution in value, the Debtors will grant the Prepetition Lender additional and replacement security interests and liens in and upon all existing and after acquired assets of the Debtors. In addition to the Replacement Liens, the Debtors will grant the Prepetition Lender: a. an allowed superpriority administrative claim; b. payment of all fees and expenses of the Prepetition Lender and the DIP Issuer accrued from and after the Petition Date; c. payment to the Prepetition Lender of (i) prepetition accrued and unpaid professional fees of the Prepetition Lender, (ii) prepetition accrued and unpaid interest on the Prepetition Loan, and (iii) post-petition accrued interest on the Prepetition Loan, which will commence immediately, at a rate of approximately $30,000 per week; and d. payment to the Prepetition Lender of any earnout amounts actually received by the Debtors from its prepetition sale of the Tank Wagon division. Pursuant to the final cash collateral order, the Debtors are permitted to use the cash collateral until the closing of the sale or any disposition of all or any material portion of their assets associated with Gas City's service station business, and the related gas station real estate owned or leased by the WJM Trust, or the occurrence of an event of default. About Gas City Gas City Ltd. -- http://www.gascity.net/-- based in Frankfort, Illinois, is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City sought Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 10-47879) on Oct. 26, 2010, estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, the William J. McEnery Revocable Trust dated Apr. 22, 1993, filed a separate Chapter 11 petition (Bankr. N.D. Ill. Case No. 10-47895). Paul V. Possinger, Esq., Mark K. Thomas, Esq., Grayson T. Walter, Esq., at Proskauer Rose LLP, in Chicago; and Daniel A. Zazove, Esq., and Kathleen A. Stetsko, Esq., at Perkins Coie LLP, in Chicago, represent the Debtors. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. The Official Committee of Unsecured Creditors has tapped Pachulski Stang Ziehl & Jones LLP and Levenfeld Pearlstein, LLC, as co-counsel and Mesirow Financial Consulting, LLC, as financial advisors. * * * The Hon. Eugene R. Wedoff of the U.S. Bankruptcy Court for the Northern District of Illinois extended the exclusive periods of Gas City, Ltd., and its debtor-affiliates to file a Chapter 11 plan until June 30, 2011, and solicit acceptances of that plan until July 30, 2011. GENCORP INC: Moody's Upgrades Corporate Family Rating to 'B1' ------------------------------------------------------------- Moody's Investors Service upgraded the corporate family and probability of default ratings of GenCorp Inc. to B1 from B2. Accordingly, Moody's also upgraded the senior secured term loan, revolving bank credit facility and letter of credit facility to Ba1 from Ba2; the guaranteed senior subordinated notes to Ba3 from B1; and subordinated convertible notes to B3 from Caa1. In addition, Moody's assigned a first time speculative grade liquidity rating of SGL-2 indicating a near term good liquidity profile. The rating outlook is stable. Ratings Upgrades and Assessment Changes: Issuer: GenCorp Inc. -- Probability of Default Rating, to B1 from B2 -- Corporate Family Rating, to B1 from B2 -- $65 million Senior Secured Revolving Credit Facility, to Ba1 (LGD1, 6%) from Ba2 (LGD1, 5%) -- $51 million Senior Secured Term Loan Facility, to Ba1 (LGD1, 6%) from Ba2 (LGD1, 5%) -- $100 million Senior Secured Letter of Credit Facility, to Ba1 (LGD1, 6%) from Ba2 (LGD1, 5%) -- $75 million 9.5% Guaranteed Senior Subordinated Notes, to Ba3 (LGD3, 39%) from B1 (LGD3, 35%) -- $62 million 2.25% Convertible Subordinated Notes, to B3 (LGD5, 83%) from Caa1 (LGD5, 81%) -- $0.3 million 4.0% Convertible Subordinated Notes, to B3 (LGD5, 83%) from Caa1 (LGD5, 81%) Assignments: Issuer: GenCorp Inc. -- Speculative Grade Liquidity Rating, Assigned SGL-2 RATINGS RATIONALE The upgrade reflects the company's steady improvement to operating results, as a leading niche supplier of solid and liquid rocket propulsion systems to prime defense contractors. Operating margins have grown to above 11% (inclusive of Moody's standard adjustments) in the most recent twelve-month period, resulting from growth in defense programs that GenCorp supplies (THAAD, Aegis, PAC-3) and good cost controls. GenCorp's funded backlog has grown steadily over several years, and is now about 90% of sales. The level of backlog provides good forward revenue visibility and compares favorably with other defense suppliers. Higher profits and stronger working capital management have led to improvement to key credit metrics (EBIT to Interest of 1.8 times, Debt to EBITDA of 4.8 times in the twelve months to February 28, 2011) that support the B1 rating. We anticipate the company to further improve its credit profile over time. The company is well positioned with a balanced program portfolio across multiple critical space, tactical and missile defense systems. Moody's expects modest continued revenue growth despite Washington budget pressures. Sustained positive free cash flow generation has built GenCorp's cash levels to above $200 million. With the build-up of cash on hand and full access to its $65 million revolving credit facility GenCorp's current liquidity profile addresses previous concerns related to the convertible notes putable to GenCorp on November 20, 2011 (originally $146.4 million; $62.1 million as of February 28, 2011). This sizeable debt maturity had previously constrained ratings uplift. Additionally, GenCorp holds substantial real estate assets in the Sacramento, California area that are deemed excess, and the company intends to monetize over time. Most of the proceeds from any sale would likely be applied to reduce debt. While a near-term monetization seems unlikely, Moody's believes that the company has flexibility to continue its entitlement initiatives and retain these assets to a time where they could be monetized during more favorable market conditions. The stable ratings outlook reflects Moody's expectation of steady profits in the intermediate term, given the high funded backlog, leading to continued positive free cash flow generation and continued good liquidity. The principal methodology used in rating GenCorp 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. GenCorp Inc., headquartered in Rancho Cordova, CA, through its Aerojet-General Corporation ("Aerojet") subsidiary, produces propulsion systems for defense and space applications and armament systems for precision tactical weapon systems. LTM revenue through 2/28/11 of $881 million. GENERAL MARITIME: OCM Marine Discloses 16.6% Equity Stake --------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission, OCM Marine Investments CTB, Ltd., and its affiliates disclosed that they beneficially own 23,091,811 shares of common stock of General Maritime Corporation representing 16.6% of the shares outstanding. A full-text copy of the filing is available for free at http://is.gd/tUBYyN About General Maritime Corp. Based in New York City, General Maritime Corporation through its subsidiaries provides international transportation services of seaborne crude oil and petroleum products. The Company's fleet is comprised of VLCC, Suezmax, Aframax, Panamax and product carrier vessels. The Company operates its business in one business segment, which is the transportation of international seaborne crude oil and petroleum products. The Company's vessels are primarily available for charter on a spot voyage or time charter basis. The Company's balance sheet at March 31, 2011, showed $1.72 billion in total assets, $1.42 billion in total liabilities, and $304.25 million in total shareholders' equity. The Company reported a net loss of $216.66 million on $387.16 million of voyage revenue for the year ended Dec. 31, 2010, compared with a net loss of $11.99 million on $350.52 million of voyage revenue during the prior year. Deloitte & Touche LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditor noted that the Company requires additional financing in order to meet its debt obligations that will come due over the next year. In addition, the Company has current losses from operations, a working capital deficit and the expectation that certain of its loan covenants will not be achieved during 2011 without additional capital being raised, debt being refinanced or covenants waived or amended. * * * Standard & Poor's Ratings Services in December 2010 lowered its long-term corporate rating on General Maritime Corp. to 'CCC+' from 'B', and placed the ratings on CreditWatch with negative implications. At the same time, S&P lowered its ratings on the company's senior unsecured notes to 'CCC-', two notches below the new corporate credit rating; the recovery rating of '6', which indicates S&P's expectation that lenders will receive a negligible (0%-10%) recovery in a payment default scenario, remains unchanged. "The downgrade reflects General Maritime's weak liquidity, very limited financial covenant headroom (despite recent amendments), and deterioration in its financial profile," said Standard & Poor's credit analyst Funmi Afonja. "As of Sept. 30, 2010, General Maritime had no borrowing availability under its $749.8 million revolving credit facility and $8.7 million in unrestricted cash, after factoring financial covenant limitations. In S&P's opinion, the recent financial covenant amendments do not provide sufficient covenant headroom, and there is still a high probability of a covenant breach over the next quarter. If there is a covenant breach, lenders can require the immediate payment of all amounts outstanding. General Maritime's liquidity is further constrained by significant upcoming debt maturities, including $27.5 million in scheduled principal payments due in 2011 under its term loan, $50.1 million semiannual reduction on the revolver, beginning on April 26, 2011, and a bullet payment of $599.6 million in October 2012, when the facility expires. General Maritime also has a $22.8 million bridge loan facility that matures in October 2011. Cash interest payments on the bridge loan will increase if the company is unable to pay off the loan by Dec. 31, 2010." In the Dec. 22, 2010 edition of the TCR, Moody's Investors Service lowered its ratings of General Maritime Corporation: Corporate Family to B3 from B1, Probability of Default to Caa1 from B2 and senior unsecured to Caa2 from Caa1. Moody's also downgraded the Speculative Grade Liquidity rating to SGL-4 from SGL-3. The outlook is negative. The downgrade of the ratings reflects GenMar's tightening liquidity position as a result of ongoing weak tanker freight rates and upcoming debt maturities. These maturities include the recently arranged $22.8 million bridge loan due Oct. 21, 2011 ("Bridge Loan"), and two $50 million repayments (one each on April 26, 2011 and Oct. 26, 2011) that are due on the company's $750 million revolving credit facility that was almost fully drawn at Sept. 30, 2010. GREAT ATLANTIC: Section 341(a) Meeting Scheduled for May 31 ----------------------------------------------------------- The U.S. Trustee for Region 2 will convene a meeting of creditors in The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors' Chapter 11 case on May 31, 2011, at 2:00 p.m. (Eastern Time). The meeting will be held at the U.S. Bankruptcy Court for the Southern District of New York, 300 Quarropas Street, Room 243A White Plains, New York. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. About Great Atlantic & Pacific Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. A&P and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010 in White Plains, New York. In its petition, A&P reported total assets of $2.5 billion and liabilities of $3.2 billion as of Sept. 11, 2010. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represent the Official Committee of Unsecured Creditors. GRUBB & ELLIS: Incurs $18.7-Mil. First Quarter Net Loss ------------------------------------------------------- Grubb & Ellis Company filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $18.68 million on $120.08 million of total revenue for the three months ended March 31, 2011, compared with a net loss of $24.05 million on $130.66 million of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $256.53 million in total assets, $242.77 million in total liabilities, $92.97 million in 12% cumulative participating perpetual convertible preferred stock, and a $79.22 million total deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/RU17eU 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. GULFSTREAM INT'L: Pilots Ratify Collective Bargaining Deal ---------------------------------------------------------- Gulfstream International Airlines' flight crewmembers, represented by the International Brotherhood of Teamsters APA Local 1224, today announced they have agreed to a five-year collective bargaining agreement with Gulfstream International Airlines. Ballots were tallied on Friday, May 6. The new contract will be in effect through May 2016. "Gulfstream's bankruptcy and reorganization has been a lot for our pilot group to digest over the last six months," said Cecil Stewart, APA Teamsters Local 1224's Gulfstream Executive Council Chairman. "With this stressful chapter from Gulfstream's history behind us, we look forward to many years of growth and success for the benefit of all of Gulfstream's flight crews." The new contract provides a significant increase in the ability of each pilot to modify his or her own schedule to accommodate personal needs. At the same time, the contract also has increased the Company's ability to obtain pilot coverage for open trips, while ensuring that crewmembers are fairly compensated for any flying above and beyond a normal monthly schedule. The contract also strengthened the scope of the contract, and ensured that all non-management pilots who work for Gulfstream will be fully covered by the collective bargaining agreement. Gulfstream Teamsters' Executive Council expects that the "quality of life" and organizational improvements which are also included in the contract will assist the airlines' new owners in a positive renovation of the company culture. Joe Muckle, president of APA Teamsters Local 1224 said, "Contract negotiations are always about give and take. In this case, the pilot group knew it was necessary to work with the company to help reduce costs so that it could effectively undergo its reorganization under Chapter 11 bankruptcy. In understanding the goals upfront, we were able to collectively find common ground on provisions which make this contract acceptable to the membership and Gulfstream International Airlines, as well as making it appealing to the airlines' new owners, Victory Park Capital." The Airline Professionals Association Teamsters Local 1224 represents the flight crewmembers of ABX Air, Atlas Air, Cape Air, Gulfstream International, Horizon Airways, Kalitta Air, Miami Air, Omni Air International, Polar Air Cargo, Southern Air and USA 3000. 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. Victory Park provided Gulfstream with up to $5 million debtor-in- possession financing to fund the Chapter 11 case. HAMPTON ROADS: Incurs $31.6-Mil. First Quarter Net Loss ------------------------------------------------------- Hampton Roads Bankshares, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $31.65 million on $27.18 million of total interest income for the three months ended March 31, 2011, compared with a net loss of $39.12 million on $34.09 million of total interest income for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $2.71 billion in total assets, $2.55 billion in total liabilities and $159.86 million in total shareholders' equity. "We are pleased with the continuing decline in our nonperforming assets," said John A. B. "Andy" Davies, Jr., president and chief executive officer. "Our strategic focus remains on exiting the problem assets on our balance sheet while returning the Company to profitability." A full-text copy of the Form 10-Q is available for free at: http://is.gd/OvGCSE 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. HARRISON TOWN: Moody's Lowers General Obligation Rating to 'Ba3' ---------------------------------------------------------------- Moody's Investors Service has downgraded to Ba3 from Baa1 the Town of Harrison's (NJ) long-term general obligation rating on approximately $17.5 million in rated outstanding debt secured by the town's general obligation, unlimited tax pledge The Ba3 does not apply to outstanding county-guaranteed debt which carries Hudson County's general obligation rating of Aa3 and its negative outlook. Harrison's general obligation outlook is negative. RATINGS RATIONALE The downgrade to Ba3 reflects our belief that Harrison may be challenged to pay debt service on its general obligation debt in the next several years given its outsized enterprise-related risk and substantial leverage. The town recently added a significant amount of debt to foster redevelopment efforts as well as higher than expected cash flow notes issued in March 2011. Large increases in leverage in 2010 and 2011 debt service have not been matched by commensurate increases in development related-revenues, as the city had anticipated. The downgrade also incorporates the town's rapidly eroded financial position (reserves fell to 0.7% of revenues in fiscal 2010 (unaudited) from 10.5% in fiscal 2009), sharply increased dependence on cash flow borrowing for operations in fiscal 2011 and recently demonstrated poor access to the capital markets. The rating also incorporates the town's relatively limited tax base and weak demographics, which potentially limits capacity to increase property tax revenues in order to meet the higher debt service obligations. It also considers the additional security provided by Hudson County's (G.O. rating Aa3/negative outlook) general obligation guaranty on 34% of outstanding Harrison debt, and corporate guarantees for debt service payment by developers on 12% of debt ($14.4 million of NJEIT loans). Affirmation of the negative outlook reflects the town's lack of a long-term solution to its outsized debt burden and debt service, and uncertainties regarding the amounts and timing of projected developer PILOT payments and expected developer reimbursements. It also considers the challenges the town may face in securing additional state and county support for meeting future debt obligations. OUTSIZED ENTERPRISE-RELATED RISK; SHARP INCREASE IN DEBT RELATED TO REDEVELOPMENT PROJECTS WITH UNMATCHED INCREASE IN REVENUES In 2006 the Hudson County Improvement Authority (HCIA), a conduit issuer with no independent taxing authority, issued $39.4 million in bonds for the Harrison stadium land acquisition project, property which was developed as the future home of the New York Red Bulls of Major League Soccer. While lease payments from the Town of Harrison to the HCIA are expected to be the source of bond repayment, the bonds are ultimately backed by an unconditional general obligation guarantee of Hudson County (G.O rated Aa3/negative outlook). Town management initially projected that ongoing redevelopment efforts in the area surrounding the stadium, through increased PILOT payments, would provide the source of payment for debt service to begin on December 15, 2010. However, the economic downturn caused these PILOT payments to be lower than anticipated. Harrison initially projected PILOT payments to the town would be $2.3 million in 2008 with the expectation that they would ramp up to levels approximating $11.5 million in 2011. Actual PILOTs collected over the last three years have been approximately $980,000 in 2009, and $1.1 million in both 2010 and 2011. When the debt began to amortize in 2010, Harrison privately issued a one-month note in order to meet the first $3.1 million debt service payment due December 15th. Subsequently, the HCIA issued bond anticipation notes in January 2011 backed by the general obligation pledge of Hudson County. A portion of those proceeds were used to repay the holder of the Harrison-issued note. The town plans to borrow an additional $3.1 million from the HCIA in order to meet its December 15, 2011 debt service obligation. The issuance of the $39.4 million of county-guaranteed CABs in 2006 and approximately $14.4 million of New Jersey Environmental Infrastructure Trust Loans in 2009, combined with $8.5 million of additional school debt, caused Harrison's debt burden to jump to 8.8% by year-end fiscal 2009 from 4.2% of equalized valuation in fiscal 2005. Debt burden increased again in 2010 to an extremely high 10.1% of equalized valuation following the issuance of notes to pay 2010 county-guaranteed debt service. Similarly, debt service has risen to 13% of fiscal 2010 expenditures from 6.3% in fiscal 2008 and comprises 16% of the fiscal 2011 introduced budget. Despite the rapid increase in debt service, Harrison has not raised its levy sufficiently to meet the additional debt service nor does it currently maintain plans to do so in the medium-term. Rather, it continues to anticipate that PILOT revenues will sufficiently cover debt service. Nearly all projects intended to generate PILOTs for debt service remain delayed year- to-date, with the exception River Park, which is 50% complete and Building 1 of Harrison Commons. Moody's believes that in the absence of sufficient PILOT revenues for developer-related debt service, developer guarantees provide a moderate level of additional security. Debt related to developers, which was intended to be repaid with PILOTs, include the 2006 county-guaranteed CABs, 2009 NJEIT loans totaling $14.4 million and a county-guaranteed Redevelopment Area Bond note of $8.5 million. Although projects intended to generate PILOTs for NJEIT debt service have not yet begun, as previously anticipated, developers have fulfilled guarantees in 2010 and year-to-date in 2011 by providing sufficient debt service reimbursements to the town. The developer guarantees include an annually renewable letter of credit and joint and several obligation. The project tied to Harrison's county-guaranteed RAB (Harrison Commons) has begun construction and is expected to be completed by September 2011. The town plans to refund the notes with long-term bonds in 2012 as PILOT revenue is realized. Although debt service for county-guaranteed CABs does not benefit from developer guarantees and the modest amount of annual PILOT revenues that are being generated have not been applied toward principal payment, the county general obligation pledge provides additional security. The NJEIT loans do not carry a county guarantee. SHARP EROSION OF FINANCIAL FLEXIBILTY IN FISCAL 2010 AND INCREASED DEPENDENCE ON CASH FLOW BORROWING FOR OPERATIONS; RECENTLY DEMONSTRATED POOR MARKET ACCESS Moody's believes Harrison may be challenged to meet debt service payments given the town's weak liquidity and dependence on the capital markets for cash flow borrowing, coupled with its poor market access. In fiscal 2010 (unaudited), the town drew down nearly all Current Fund balance to a very narrow $26,000 or 0.7% of revenues from a satisfactory $3.9 million or 10.5% of revenues in fiscal 2009. The draw represents a structural imbalance of 8% of the fiscal 2010 budget, which the town is challenged to close in the introduced fiscal 2011 budget. As a result of the use of Current Fund balance , cash has declined to $6.4 million or 16.7% of revenues (net of Tax Anticipation Note proceeds), driving a larger than anticipated TAN issuance of $8.5 million for the fiscal 2011 budget. The note matures December 2011, unlike the fiscal 2010 note, which matured after the fiscal 2010 fiscal year in February 2011. Moody's believes Harrison's increased reliance on the capital markets for cash flow purposes presents another significant uncertainty given the town's very poor market access in 2011. Notably, Harrison did not issue tax anticipation notes (TANs) in 2009 after issuing $6 million in TANs in both fiscal years 2007 and 2008. However, it did resume the practice in fiscal 2010 by issuing $6 million in TANs. Prior to fiscal 2011, the town negotiated note placements with a commercial bank; however the bank chose not to renew in 2011 when Harrison issued BANs and TANs in March and April, respectively. With only one bidder on each note from the same investor, uncertainties arise around the town's ability to secure access to the market in fiscal 2012 and ahead. Given stressed fiscal 2012 cash flow projections, Moody's believes a failed TAN sale in 2012 would severely challenge the town to make timely debt service without alternative financing. Poor market access may also affect the refunding of $5.6 million in general obligation BANs that come due in August 2012. In order to mitigate market access risk, the town has applied to the State of New Jersey Local Finance Board for participation in the Municipal Qualified Bond Program. The state will review the application this June. Aside from these notes, the town only maintains a RAB note held by the Hudson County Improvement Authority. If the town is accepted into the state's qualified bond program, it would have to issue new money or refund and reissue outstanding series to place them into the program; outstanding debt is not automatically in the program. Looking ahead, the introduced fiscal 2011 budget aggressively assumes $2.9 million of property tax revenue from the Red Bull stadium and $1 million of land sale proceeds, for which a buyer has not yet been secured. In fiscal 2010, the New York Red Bulls failed to pay approximately $1.4 million of property taxes due to Harrison, legally challenging its status as a taxable property. The fiscal 2011 budget anticipated Red Bull 2010 property tax revenue as a delinquent tax as well as $1.4 million of current taxes due in 2011. Moody's believes the town may not receive these monies prior to year-end. Without significant current year expenditure savings, Harrison will be severely challenged to maintain a positive fund balance as well as current, albeit very narrow, liquidity levels. DEVELOPMENT EFFORTS REMAIN STALLED; MODEST TAX BASE WITH BELOW- AVERAGE WEALTH LEVELS Approximately one-third of Harrison has been designated as a redevelopment area. The town is attempting to leverage its location in western Hudson County, just north of Newark (G.O. rated A3/negative outlook), with proximity to New York City (G.O. rated Aa2/stable outlook). Equalized value per capita grew at a healthy five-year annual average rate of 12.6% through 2008, indicative of strong market value appreciation, before declining 14.7% in fiscals 2009 and 2010. Management initially projected PILOTs to the town at $2.3 million in 2008 with the expectation that they would increase to levels approximating $11.5 million in 2011. However, given the economic downturn, development has slowed and, as indicated above, PILOT payments have been significantly less than originally projected, most severely at less than 10% of expectations in fiscal 2011. Additionally, the town had been looking to the stadium for the Red Bulls professional soccer team, which was projected to open in the summer of 2008 but was delayed to 2010, to spur development and PILOT revenue. Income and wealth levels in Harrison are well-below the state medians, with per capita and median family income at 68.5% and 74.2% of the state levels, respectively, and equalized value per capita of $77,882. Outlook Assignment of the negative outlook reflects the town's future ability to access the capital markets for cash flow purposes, the lack of a long-term solution to an outsized debt burden and substantial near-term debt service, and uncertainties regarding the amounts and timing of projected developer PILOT payments and expected reimbursements. It also considers difficulties the town may face in securing additional state and county support for meeting future debt obligations as well as our belief that redevelopment efforts are likely to proceed slower than originally projected over the near-term. WHAT COULD MOVE THE RATING UP (REMOVAL OF THE NEGATIVE OUTLOOK): * An increase in PILOT payments by fiscal 2012 sufficient to pay debt service * Growth in the tax base from renewed development efforts * Improved market access demonstrated by multiple bids for short-term notes * Adoption of conservatively structured budgets WHAT COULD MOVE THE RATING DOWN: * Lack of future market access * Any inability to execute a financing plan to meet debt service payments on the stadium land acquisition bonds * Use of PILOT payments for town operations rather than for debt service, as was originally intended * Continued reliance on short-term borrowing to pay debt service * Future debt issuances that materially increase the town's debt burden * Increased cash flow borrowing in relation to the budget * Further deterioration of the town's tax base 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. HARRY & DAVID: Files Joint Plan of Reorganization ------------------------------------------------- Harry and David Holdings, Inc. and its subsidiaries currently acting as debtors in possession under Chapter 11 of the United States Bankruptcy Code have filed a Joint Plan of Reorganization and Disclosure Statement with the United States Bankruptcy Court for the District of Delaware. The Plan has the support of the Official Committee of Unsecured Creditors and the holders of approximately 81% of the Company's public notes. With this filing, the Company intends to exit bankruptcy in late Summer 2011. Kay Hong, Chief Restructuring Officer and interim Chief Executive Officer, said, "The filing of our Plan of Reorganization and Disclosure Statement is a vital step toward Harry and David's successful emergence from the Chapter 11 reorganization process. Our employees, customers, suppliers and other supporters have been instrumental in our ability to reach this important milestone, and we deeply appreciate their support." The Company expects to emerge from its financial restructuring with a significantly improved balance sheet and with substantially less debt. The proposed Plan will allow the Company to convert all of its approximately $200 million of outstanding public notes into equity of the reorganized company. The Plan also includes an equity capital raise that will generate $55 million in equity financing upon the Company's emergence from chapter 11. A group of the Company's existing noteholders have agreed to backstop the equity capital raise. The Company will utilize proceeds from the equity capital raise to satisfy obligations arising from its $55 million post-petition term loan. Additionally, the Company has a $100 million revolving loan commitment to finance its operations after the Company exits chapter 11 which will replace its current $100 million post-petition revolving loan facility. As part of this process, the Company anticipates holding a hearing on the adequacy of the Disclosure Statement in June 2011. After receiving approval of its Disclosure Statement, the Company expects to solicit approval of the Plan by the necessary classes of creditors and hold a confirmation hearing on the Plan. Harry & David's investment banker is Rothschild Inc., its legal advisor is Jones Day, and its financial advisor is Alvarez & Marsal. The Company's bondholders are being advised by Stroock & Stroock & Lavan LLP, as legal counsel, and Moelis & Company as financial advisor. About Harry & David Medford, Oregon-based Harry & David Holdings, Inc. -- aka Bear Creek Corporation; Bear Creek Direct Marketing, Inc.; Bear Creek Stores, Inc.; Bear Creek Operations, Inc.; and Bear Creek Orchards, Inc. -- is a multi-channel specialty retailer and producer of branded premium gift-quality fruit and gourmet food products and gifts marketed under the Harry & David(R), Wolferman's(R) and Cushman's(R) brands. It has 70 stores across the country. Harry & David Holdings filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-10884) on March 28, 2011. Affiliates Harry and David (Bankr. D. Del. Case No. 11-10885), Harry & David Operations, Inc. (Bankr. D. Del. Case No. 11-10886), and Bear Creek Orchards, Inc. (Bankr. D. Del. Case No. 11-10887) filed separate Chapter 11 petitions. The cases are jointly administered, with Harry David Holdings as lead case. Daniel J. DeFranceschi, Esq.; Paul Noble Heath, Esq.; and Zachary Shapiro, Esq., at Richards Layton & Finger, serve as the Debtors' local counsel. David G. Heiman, Esq.; Brad B. Erens, Esq.; and Timothy W. Hoffman, Esq., at Jones Day, are the Debtors' legal counsel. Rothschild Inc. is the Debtors' investment banker. Alvarez & Marsal LLC is the Debtors' financial advisor. Garden City Group Inc. is the Debtors' claims and notice agent. McKinsey Recovery & Transformation Services U.S. LLC is being tapped as management consultants. Kristopher M. Hansen, Esq., and Erez E. Gilad, Esq., at Stroock & Stroock & Lavan LLP; Thomas B. Walper, Esq., at Munger, Tolles & Olson LLP; and Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP are counsel to principal noteholders. Moelis & Company is the financial advisor to the principal noteholders. Lowenstein Sandler has been retained as counsel to the unsecured creditors committee in the Harry & David bankruptcy case. The Debtors disclosed $304.3 million in total assets and $360.8 million in total debts as of Dec. 25, 2010. HEARUSA INC: Given Approval for $10 Million Financing ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that HearUSA Inc. was given authority from the bankruptcy judge for $10 million in financing provided by William Demant Holdings A/S. The loan will be secured by a lien junior to existing bank credits. Demant, based in Denmark, has an agreement to buy the business for $80 million. The final hearing for financing approval is set for May 31. HearUSA owes $31.3 million to Siemens Hearing Instruments Inc., the principal supplier and primary secured lender. The Demant contract requires bankruptcy court approval of auction procedures by June 6 and the completion of the auction by July 18. The hearing for approval of the sale must occur by July 19. About HearUSA HearUSA, Inc., which sells hearing aids in 10 states, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 11-23341) on May 16, 2011, to sell the business for $80 million to William Demant Holdings A/S. The Debtor said that assets are $65.6 million against debt of $64.7 million as of March 31, 2010. HearUSA operates 134 centers throughout Florida, New York, New Jersey, Massachusetts, Ohio, Michigan, Missouri, North Carolina, Pennsylvania, South Carolina and 38 centers in California (through HEARx West). HearUSA said it is the nation's only hearing care network accredited by Utilization Review Accreditation Commission, an independent, nonprofit health care accrediting organization. K. Gart, Esq., at Berger Singerman, P.A., in Fort Lauderdale, Florida, and Debi Evans Galler, Esq., and Paul Steven Singerman, Esq., at Berger Singerman, P.A., in Miami, Florida, represent the Debtor. Bryan Cave LLP serves as special counsel. Sonenshine Partners, LLC, is the investment banker. Development Specialists, Inc., serves as restructuring advisor. Trustee Services, Inc., serves as claims and notice agent. AlixPartners, LLC, is the communications consultant. HEARUSA INC: Gets Delisting Notices From NYSE Amex LLC ------------------------------------------------------ Healthcare Finance News reports that HearUSA Inc. has received a written notice from NYSE Amex LLC indicating that the Company no longer complies with the Exchange's continued listing standards as a result of the Company's filing of a voluntary petition under Chapter 11 of the US Bankruptcy Code and that its securities are therefore subject to being delisted from the Exchange. According to the report, the Exchange stated its intention to file a delisting application with the Securities and Exchange Commission and to truncate the procedures regarding continued listing evaluation and follow-up as specified in the rules of the Exchange. The Exchange notice states that the Staff of the Exchange intends to initiate immediate delisting proceedings. In particular, the written notice from the Exchange stated that i) as a result of the Chapter 11 filing, the Staff has determined that the Company is financially impaired and, as such, is not in compliance with Section 1003(a)(iv) of the NYSE Amex Company Guide; and ii) the Company is not in compliance with Section 134 and Section 1101 of the Company Guide because the Company failed to timely file its Quarterly Report on Form 10-Q for the fiscal quarter ended March 26, 2011. The Company's first fiscal quarter actually ended on April 2, 2011 and the Company was not delinquent in filing its Form 10-Q at the time of the notice from the Exchange. The Company does not intend to appeal the Exchange's determination to delist the Company's common stock. After the Company's common stock is delisted, the Company cannot predict whether any trading market, including any over-the-counter trading market, for the Company's common stock will develop or be sustained. Based in West Palm Beach, Florida, HearUSA Inc. sells hearing aids in 10 states. The Company filed for Chapter 11 bankruptcy protection on May 16, 2011 (Bankr. S.D. Fla. Case No. 11-23341). Judge Erik P. Kimball presides over the case. Brian K. Gart, Esq., Paul Steven Singerman, Esq., and Debi Evans Galler, Esq., at Berger Singerman, P.A., represents the Debtor. The Debtor selected Bryan Cave LLP as special counsel; Sonenshine Partners LLC, investment banker; Development Specialist Inc., restructuring advisor; Trustee Services Inc., claims and balloting agent; and Alixpartners LLC, communications consultant. The Debtor estimated both assets and debts of between $50 million and $100 million. HEATING OIL: No Notice of Bankruptcy No Defense on Stay Violation ----------------------------------------------------------------- The U.S. Court of Appeals in Manhattan said in an opinion on May 16 that even if the plaintiff in a state-court lawsuit never had notice that the defendant filed for bankruptcy, a judgment in the case was void from the outset. In Church Mutual Insurance Co. v. American Home Assurance Co. (In re Heating Oil Partners LP), 10-733, 2nd U.S. Circuit Court of Appeals (Manhattan), the plaintiff argued there was no violation of the so-called automatic stay because it never received notice of the bankruptcy. The three-judge panel, in an unsigned opinion, said the argument didn't matter because the suit began or continued in violation of the stay. The 2nd Circuit in Manhattan also ruled "without a doubt" that the defendant's insurance company had standing to bring the lawsuit that voided the state-court judgment. About Heating Oil Partners Headquartered in Darien, Connecticut, Heating Oil Partners, L.P., nka HOP Energy, LLC -- http://www.hopheat.com/-- is one of the largest residential heating oil distributors in the United States, serving approximately 150,000 customers in the Northeastern United States. The Company's primary business is the distribution of heating oil and other refined liquid petroleum products to residential and commercial customers. The Company and its subsidiaries filed for chapter 11 protection on Sept. 26, 2005 (Bankr. D. Conn. Case No. 05-51271) and filed for recognition of the chapter 11 proceedings under the Companies' Creditors Arrangement Act (Canada). Craig I. Lifland, Esq., and James Berman, Esq., at Zeisler and Zeisler PC, represent the Debtors in their restructuring efforts. Jeffrey D. Prol, Esq., at Lowenstein Sandler PC, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they disclosed $127,278,000 in total assets and $155,033,000 in total debts. The Bankruptcy Court confirmed Heating Oil Partners, LP, and Heating Oil Partners, GP, Inc.'s First Amended Joint Plan of Reorganization on June 15, 2006. The Ontario Superior Court of Justice Commercial List issued an order on June 26, 2006, recognizing and implementing the U.S. Bankruptcy Court order. HERBST GAMING: Changes Name to Affinity Gaming ---------------------------------------------- Herbst Gaming, LLC disclosed that, as of May 20, 2011, the Company name will be Affinity Gaming, LLC. The Company successfully emerged from bankruptcy at the end of 2010 and has changed its name to Affinity Gaming to reflect its new beginning, new board of directors and new corporate management team. The Company will continue to operate each of its casino properties under their familiar local names and where applicable, the "Terrible's" moniker. "In order to reflect our new corporate identity, we have changed our corporate name to Affinity Gaming. Given that prior management and owners, the Herbst family, are no longer associated with our casino and slot route businesses, we believe it is in the interest of the employees and management to make a fresh start," said David D. Ross, Chief Executive Officer. "Our new name represents our strategy of offering a value-oriented product in a convenient, friendly and casual atmosphere. We continue to focus on delivering the highest quality service to our customers at a reasonable price. Going forward, Affinity Gaming will be committed to enhancing customer satisfaction and loyalty, which are critical to our long-term success," concluded Mr. Ross. Emergence from Chapter 11 Reorganization On Dec. 31, 2010, (i) the Company, now Affinity Gaming, LLC, acquired substantially all of the assets of its Predecessor (Herbst Gaming, Inc. or HGI) in consideration of $350 million in aggregate principal amount of senior secured loans and the issuance to Predecessor of all of the Company's common membership units, (ii) the senior secured loans and common units were distributed by Predecessor to the lenders under HGI's prior credit facility on a pro rata basis in accordance with HGI's bankruptcy plan, (iii) all of Predecessor's approximately $1.1 billion in outstanding long-term debt obligations, consisting of borrowings under HGI's credit facility, $160.0 million of outstanding principal amount of 8.125% senior subordinated notes and $170.0 million of outstanding principal amount of 7% senior subordinated notes, were terminated, and (iv) 100% of the existing equity in Predecessor was cancelled. On Dec. 31, 2010, the Company adopted fresh start accounting in accordance with applicable accounting standards. As a result, the value of Predecessor's assets, including intangible assets, and liabilities have been adjusted to their fair values with any excess of the Company's enterprise value over the Company's tangible and identifiable intangible assets and liabilities reported as goodwill on the Company's consolidated balance sheet. Please refer to the annual report on Form 10-K filed March 31, 2011, and quarterly report on Form 10-Q filed May 13, 2011, by Herbst Gaming, LLC with the Securities and Exchange Commission for additional financial information. About Affinity Gaming Affinity Gaming is a diversified gaming company that focuses on two business lines: casino operations and slot machine route operations. As of Dec. 31, 2010, the Company's casino operations consisted of 15 casinos, 12 of which are located in Nevada, two in Missouri and one in Iowa. The Company's slot route operations consist of approximately 6,000 slot machines throughout Nevada. HERCULES OFFSHORE: Appoints Craig Muirhead as VP and Treasurer -------------------------------------------------------------- Craig M. Muirhead has been appointed to the position of Vice President and Treasurer of Hercules Offshore, Inc. Mr. Muirhead joined the company in January 2007 as a Corporate Finance Analyst and most recently served as Assistant Treasurer. Prior to joining Hercules Offshore, he served in various finance positions at Cameron International. He holds a Bachelors of Arts degree in Mathematical Economic Analysis from Rice University and a Masters of Business Administration from The University of Texas at Austin. At the same time, Kimberly A. Riddle was named as Vice President Human Resources. Ms. Riddle will replace Lisa W. Rodriguez, who announced her retirement from the Company in April 2011. Ms. Riddle has been with the Company since March 2008, and served in Human Resources as the Compensation Manager. Prior to joining Hercules Offshore, Ms. Riddle served as a Human Capital Consultant at Deloitte Consulting and has over 20 years of experience in human resources, specializing in compensation management. She holds a Bachelors of Arts degree in Journalism from the University of Houston. On May 13, 2011, the Company and its wholly owned subsidiary, Delta Towing LLC, entered into an asset purchase agreement with Crosby Marine Transportation, LLC, by which Delta Towing sold to Crosby Marine, and Crosby Marine acquired from Delta Towing, substantially all of Delta Towing's assets and certain liabilities for aggregate consideration of $30 million in cash. In addition, the Company retained the working capital of the business, which was valued at approximately $6.3 million, as of April 30, 2011. As a result of this sale, the Company expects to record a non-cash impairment charge of approximately $13 million during the second quarter of 2011 related to the write-down of the Delta assets included in the sale to fair value less costs to sell. On May 16, 2011, the Company, through its wholly-owned subsidiary, TODCO Mexico, Inc., initiated the permanent importation of Rig 3 and related equipment and spares into Mexico, at a net cost of approximately $8 million, which will impact second quarter 2011 financial results. Rig 3 is currently operating under a contract with PEMEX Exploracion y Produccion. John T. Rynd, chief executive officer and president, stated, "We are very fortunate that Craig and Kim have moved into their new roles at Hercules Offshore. They have been valuable assets to the Company and we look forward to the continued contributions and leadership they will bring to our organization." "We have continued to seek opportunities to divest of non-core assets and I am pleased that we have completed the sale of the Delta Towing assets. Crosby Marine is a premium operator and we look forward to working with them in the future. Furthermore, we believe the permanent importation of Rig 3 into Mexico will allow us the opportunity to participate in multi-year contracting opportunities." 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'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. 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. HIGHLANDS OF LOS GATOS: U.S. Trustee Wants Case Converted to Ch. 7 ------------------------------------------------------------------ August B. Landis, Acting U.S. Trustee for Region 17, asks the U.S. Bankruptcy Court for the Northern District of California to convert the Chapter 11 case of The Highlands of Los Gatos, LLC, to one under Chapter 7 of the Bankruptcy Code. The U.S. Trustee explains that: (1) the Debtor has incurred (or will soon incur) a substantial and continuing loss - i.e., its real property - and has no hope of successfully reorganizing its affairs; and (2) the Debtor failed to file monthly operating reports for the several months, making it impossible for the U.S. Trustee, the Court and creditors to monitor Debtor's performance while in bankruptcy. The U.S. Trustee is represented by: Edwina E. Dowell, Esq. Nanette Dumas, Esq. John S. Wesolowski, Esq. Emily S. Keller, Esq. U.S. Department of Justice Office of the U.S. Trustee 280 S. First Street, Suite 268 San Jose, CA 95113-0002 Tel: (408) 535-5525 Fax: (408) 535-5532 About The Highlands of Los Gatos Campbell, California-based The Highlands of Los Gatos, LLC, owns certain real property located in the Town of Los Gatos, county of Santa Clara. The real property consists of approximately 66 acres of land which were developed for construction of single family residences. The Company filed for Chapter 11 bankruptcy protection on July 16, 2010 (Bankr. N.D. Calif. Case No. 10- 57370). Charles B. Greene, Esq., at the Law Offices of Charles B. Greene, represents the Debtor. The Company estimated its assets and debts at $10 million to $50 million. HORIZON BANCORP: Lowers First Quarter Net Loss to $21,400 --------------------------------------------------------- Horizon Bancorporation, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $21,359 for the three months ended March 31, 2011, compared with a net loss of $1.86 million for the same period last year. In 2010 the loss was attributable almost entirely to a loss of $1,845,000 at the closed Horizon Bank. The Company's balance sheet at March 31, 2011, showed $1.25 million in total assets, $1.08 million in total liabilities, and stockholders' equity of $169,480. As reported in the TCR on April 25, 2011, Francis & Co., CPA's, in Atlanta, Georgia, noted that the Company has suffered heavy losses in calendar years 2010 and 2009, reducing its capital accounts significantly. "Moreover, federal and state regulators, in 2009, imposed a Written Agreement on the Bank mainly due to increasing levels in non-performing assets and eroding regulatory capital. The above, combined with the closing of the subsidiary bank 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/edFrkR About Horizon Bancorporation Brandenton, Fla.-based Horizon Bancorporation, Inc., acted as a one-bank holding company with respect to Horizon Bank, Bradenton, Florida, from Oct. 25, 1999, when the Bank commenced operations, until Sept. 10, 2010, when the Florida Office of Financial Regulation (the "OFR") declared the Bank to be insolvent. The Bank was closed, with the FDIC being appointed as receiver therefor, and sold to Bank of the Ozarks. In the short run, management intends to maintain the Company's status as a reporting public company, which, if an appropriate opportunity arises, may engage in a transaction with an operating company. HUMBOLDT CREAMERY: Former CEO Hit With 2.5 Years for Fraud ---------------------------------------------------------- U.S. District Judge Charles R. Breyer sentenced the former CEO of Humboldt Creamery to 2 1/2 years in prison Thursday and ordered him to pay $7 million for falsifying financial records for a loan from agricultural cooperative CoBank ACB and helping bankrupt the dairy cooperative. Former Humboldt Creamery CEO Richard Ghilarducci pled guilty before U.S. District Judge Charles R. Breyer to one felony count of providing false statements to an agricultural bank on May 5, 2010. Donna Tam at the Times-Standard reports that Judge Breyer ordered Mr. Ghilarducci to turn himself in to the U.S. Marshals office in Phoenix, Arizona, despite Mr. Ghilarducci's attorney asking the judge to consider allowing his client 30 days to turn himself in. The Times-Standard recounts that Mr. Ghilarducci pleaded guilty in May 2010 to a single count of making false statements to CoBank, an agricultural credit bank. He faced a maximum sentence of 30 years in prison, and the original plea agreement he entered into with the government recommended a sentence of from four years and three months to five years and three months in prison. In court Wednesday, Judge Breyer, according to the Times-Standard, said a recent probation report recommended a sentence with a low of about three and a half years to a high of four years and three months in prison. Mr. Ghilarducci's attorney Elliot Peters filed a motion asking the court to take into consideration Mr. Ghilarducci's cooperation in the case. About Humboldt Creamery Headquartered in Fortuna, California, Humboldt Creamery, LLC -- http://www.humboldtcreamery.com/-- filed for Chapter 11 on April 21, 2009 (Bankr. N.D. Calif. Case No. 09-11078). Ori Katz, Esq., at Sheppard, Mullin, Richter and Hampton, represents the Debtor in its restructuring efforts. The Debtor disclosed total assets and debts from $50 million to $100 million. IMH FINANCIAL: Incurs $5.4-Mil. First Quarter Net Loss ------------------------------------------------------ IMH Financial Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a a net loss of $5.40 million on $1.02 million of total revenue for the three months ended March 31, 2011, compared with a net loss of $2.85 million on $1.01 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $227.39 million in total assets, $31.43 million in total liabilities and $195.96 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/cnHJgI About IMH Financial Scottsdale, Ariz.-based IMH Financial Corporation was formed from the conversion of IMH Secured Loan Fund, LLC, or the Fund, a Delaware limited liability company, on June 18, 2010. The conversion was effected following a consent solicitation process pursuant to which approval was obtained from a majority of the members of the Fund to effect the Conversion Transactions and involved (i) the conversion of the Fund from a Delaware limited liability company into a Delaware corporation named IMH Financial Corporation, and (ii) the acquisition by the Company of all of the outstanding shares of the manager of the Fund Investors Mortgage Holdings Inc., or the Manager, as well as all of the outstanding membership interests of a related entity, IMH Holdings LLC, or Holdings on June 18, 2010. The Company is a commercial real estate lender based in the southwest United States with over 12 years of experience in many facets of the real estate investment process, including origination, underwriting, documentation, servicing, construction, enforcement, development, marketing, and disposition. The Company focuses on a niche segment of the real estate market that it believes is underserved by community, regional and national banks: high yield, short-term, senior secured real estate mortgage loans. The intense level of underwriting analysis required in this segment necessitates personnel and expertise that many community banks lack, yet the requisite localized market knowledge of the underwriting process and the size of the loans the Company seeks often precludes the regional and community banks from efficiently entering this market. "Given the current state of the real estate and credit markets, we believe the realization of full recovery of the cost basis in our assets is unlikely to occur in a reasonable time frame and may not occur at all, and we may be required to liquidate portions of our assets for liquidity purposes at a price significantly below the initial cost basis or potentially below current carrying values. If we are not able to liquidate a sufficient portion of our assets or access credit under the credit facility currently under negotiation, there may be substantial doubt about our ability to continue as a going concern. Nevertheless, we believe that our cash and cash equivalents, coupled with liquidity derived from the credit facility currently under negotiation and the disposition of certain of the loans and real estate held for sale, will allow us to fund current operations over the next 12 months," the Company said in its Form 10-Q for the quarter ended Sept. 30, 2010. The Company reported a net loss of $117.04 million on $3.75 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $74.47 million on $22.52 million of total revenue during the prior year. As reported by the TCR on April 20, 2011, BDO USA, LLP, in Phoenix, Arizona, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses and is not currently generating sufficient cash flows to sustain operations. INNKEEPERS USA: Preferred Equity Receiving $3.5 Million ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Innkeepers USA Trust received formal approval for the disclosure statement explaining the reorganization plan. The confirmation hearing is set for June 23. The ad hoc committee representing preferred shareholders now urges voting in favor of the plan. Support for the plan by preferred shareholders coincides with revelation in the disclosure statement that the ad hoc committee will be paid $3.5 million as a so-called allowed administrative claim. In return, preferred shareholders agree to make no claim for reimbursement for making a substantial contribution to the case. According to the report, the disclosure statement outlines the primary dispute that will remain after the plan is confirmed. The two main secured creditors, Midland Loan Services Inc. and Lehman Ali Inc., have a dispute with Innkeepers over whether they waived deficiency claims when they agreed to the protocol setting up the auction. The two lenders contend they made no waiver and object to how Innkeepers' owner, Apollo Investment Corp., could walk away from confirmation with what the disclosure statement said is about $6.8 million. The $3.5 million payment to the ad hoc committee also may reduce the lenders' recovery on their deficiency claims, even if they convince the judge there was no waiver. Revised Chapter 11 Plan Innkeepers USA Trust filed a revised reorganization plan May 9 along with an updated disclosure statement incorporating the outcome of an auction where Cerberus Capital Management LP and Chatham Lodging Trust emerged as the winning bidders. A joint venture between the private-equity firm Cerberus Capital Management, L.P. and real estate investment trust Chatham Lodging agreed to acquire the Debtors' interests in most hotel properties for $1.1 billion. In addition, Chatham Lodging is buying five properties (Residence Inn Mission Valley, Residence Inn Anaheim (Garden Grove), Doubletree Washington, DC, Residence Inn Tyson's Corner, and Homewood Suites San Antonio) for $195 million. The terms of the revised plan are: * Lehman Ali Inc. will be paid in full, although the amount of cash it is to be paid remains blank. Lehman Ali, a non- bankrupt subsidiary of Lehman Brothers Holdings Inc., has $238 million in floating-rate mortgages on 20 of the properties. * Midland will recover almost 88% although the revised plan does not say exactly what Midland will receive under the plan. * Holders of $131.3 million in mezzanine loans against the 65 hotels will recover about 12%. The disclosure statement has a blank where the amount of the cash payment to the mezzanine lenders is mentioned. * General unsecured creditors, with as much as $7 million in claims, will split up $4.65 million cash. Their recovery will range from 67.6% to almost full payment. About $70 million in loans made during the Chapter 11 case will be paid off from the purchase price paid by Cerberus and Chatham. * There will be no recovery for equity holders, including Apollo Investment Corp. which acquired the company in July 2007 in a $1.35 billion transaction. In return for a release, Apollo will pay Midland $3 million. * The Hilton Suites hotel in Anaheim, California, will be turned over to the Lehman parent that controls the mezzanine debt. The special servicer for the mortgage on the Hilton in Ontario, California, will take over the property and provide cash for what the disclosure statement calls a "small percentage recovery" for unsecured creditors. About Innkeepers USA Trust Innkeepers USA Trust is a self-administered Maryland real estate investment trust with a primary business focus on acquiring premium-branded upscale extended-stay, mid-priced limited service, and select-service hotels. Innkeepers, through its indirect subsidiaries, owns and operates an expansive portfolio of 72 upscale and mid-priced extended-stay and select-service hotels, consisting of approximately 10,000 rooms, located in 20 states across the United States. Apollo Investment Corporation acquired Innkeepers in June 2007. Innkeepers USA Trust and 91 affiliates filed for Chapter 11 protection on July 19, 2010 (Bankr. S.D.N.Y. Case No. 10-13800). Paul M. Basta, Esq., at Kirkland & Ellis LLP, in New York; Anup Sathy, P.C., Esq., Marc J. Carmel, Esq., at Kirkland & Ellis in Chicago; and Daniel T. Donovan, Esq., at Kirkland & Ellis in Washington, D.C., serve as counsel to the Debtors. AlixPartners is the restructuring advisor and Marc A. Beilinson is the chief restructuring officer. Moelis & Company is the financial advisor. Omni Management Group, LLC, is the claims and notice agent. Attorneys at Morrison & Foerster, LLP, represent the Official Committee of Unsecured Creditors. The Company's consolidated assets for 2009 totaled approximately $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred approximately $1.29 billion of secured debt. INNOVATIVE FOOD: Reports $170,100 First Quarter Net Income ---------------------------------------------------------- Innovative Food Holdings, Inc., filed its quarterly report on Form 10-Q, reporting net income of $170,128 on $2.5 million of revenue for the three months ended March 31, 2011, compared with a net loss of $1.0 million on $2.3 million of revenue for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.2 million in total assets, $7.0 million in total liabilities, all current, and a stockholders' deficit of $5.8 million. As reported in the TCR on March 23, 2011, RBSM LLP, in New York, expressed substantial doubt about Innovative Food Holdings' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred significant losses from operations since its inception and has a working capital deficiency. A complete text of the Form 10-Q is available for free at: http://is.gd/jlEcZR Naples, Fla.-based Innovative Food Holdings, Inc., through its subsidiaries, provides perishables and specialty food products to the wholesale foodservice industry. INT'L AUTOMOTIVE: Moody's Assigns 'B1' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service assigned initial ratings to International Automotive Components Group, S.A., (IAC) -- Corporate Family and Probability of Default Ratings, at B1. In a related action Moody's assigned a B3 rating to IAC's proposed $300 million senior secured notes. The net proceeds of the new notes will be used to paydown portions of IAC's debt in North America and in Europe, and to make a special distribution to the company's shareholders. The rating outlook is stable. These ratings were assigned: International Automotive Components: -- Corporate Family Rating, B1; -- Probability of Default Rating, B1; -- B3 (LGD5, 85%), for the $300 million senior secured note RATINGS RATIONALE The B1 Corporate Family Rating incorporates IAC's weak EBIT margin, aggressive acquisition strategy, and high customer concentrations. As global automotive volumes gradually improve, IAC's working capital levels are expected to reflect this growth, and some increase in raw material costs, which may pressure free cash flow generation over the near-term. Since being formed in 2006, IAC has acquired the assets from 14 businesses throughout North America, Europe, and Asia. This acquisition strategy has resulted in high customer concentrations with GM, Ford, and Chrysler/Fiat, representing about 54% of sales for 2010. While IAC's 2010 EBIT margin of about 3.2% (as adjusted by Moody's) is low compared to rated piers, it reflects the benefit of several restructuring actions taken since the formation of the company including headcount reductions, lowered wages, and operating efficiency improvements. Yet, the modest 2010 pro forma leverage for the proposed recapitalization of about 3.6x and modest debt service requirements are expected to provide operating flexibility to manage through regional fluctuations in demand. IAC's geographic footprint is mostly North American at about 58% percent of sales. This region is expected to continue to experience recovering automotive demand. European revenues represent about 36% of 2010 revenues. IAC's product sales are spread across several areas of the automobile interior, supporting the company's ability to provide a portfolio of interior components and systems. In addition, the company's roll up strategy has led to being positioned on leading platforms in North America and Europe. According to management, new business awards have increased through year-end 2010. The stable outlook considers Moody's expectation that generally improving global automotive industry conditions combined with company's modest leverage will support the assigned rating over the intermediate-term. With ongoing industry pressures from raw material costs, negotiated price-downs with OEM customers, and normal cyclicality, IAC is anticipated to continue to implement operational efficiency programs to create margin improvements. IAC is expected to have an adequate liquidity profile over the next twelve months supported by cash balances, and separate North American and European credit facilities. Following the consummation of the transaction, IAC is expected to have about $72 million of unrestricted cash on hand, plus $19 million of restricted cash available to a certain manufacturing facility's borrowing. Liquidity is supported by a $200 million North American ABL facility and a Euro125 million European accounts receivable securitization (both unrated). As part of the transaction, a portion of the net proceeds from the note offering will be used to pay down outstandings under the North American ABL and European securitization facilities, creating moderate availability. Further, some of the free cash flow generation in 2011 is expected to support debt reduction under the North American ABL, thus also increasing availability. The senior secured note is not expected to have financial maintenance covenants. The North American ABL facility and European securitization facilities have springing fixed charge coverage tests and minimum EBITDA tests when availability under the respective facilities reaches certain thresholds. A moderate amount of alternate liquidity is expected to be provided through additional indebtedness baskets under the senior secured note. Future events that have the potential to drive IAC's rating higher include: consistent FCF/Debt approaching 10%, improvement in operating performance resulting in EBIT margins above 5%; further diversification of the company's customer base could also lead to an improvement the in rating outlook. Future events that have the potential to drive IAC's outlook or rating lower include regional weaknesses in global automotive production which is not offset by successful restructuring actions, deterioration in operating performance resulting in Debt/EBITDA approaching 4.0x or EBIT/interest expense approaching 2.0x, or deterioration in company's liquidity position. The principal methodology used in rating IAC 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. International Automotive Components Group, S.A. (IAC), a Luxembourg entity, together with its subsidiaries, offers original equipment manufacturers around the world a broad portfolio of interior components and systems through core product categories, including Instrument Panels, Consoles & Cockpits, Door & Trim Systems, Flooring & Acoustic Systems and Headliner & Overhead Systems, as well as Other Interior & Exterior Components. Sales in 2010 approximated $3.7 billion. INT'L AUTOMOTIVE: S&P Gives 'B+' Corporate; Outlook is Stable ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary 'B+' corporate credit rating to International Automotive Components Group S.A. (IAC), a Luxembourg-based global auto supplier with regional offices in Southfield, Mich. and Krefeld, Germany. "We also assigned preliminary issue ratings to IAC's proposed debt (See Ratings List below). The outlook is stable," S&P related. "The preliminary 'B+' corporate credit rating on IAC reflects our view of the company's aggressive financial risk profile, with debt to EBITDA (including our adjustments) that we expect will be around 3.5x or less over the next year," said Standard & Poor's credit analyst Nishit K. Madlani, "and its vulnerable business risk profile that reflects its limited track record in its current form." Other factors include our assumption of single-digit EBITDA margins and participation in the volatile and competitive global auto supplier industry. INTERNATIONAL GARDEN: Has Until Aug. 1 to Propose Chapter 11 Plan ----------------------------------------------------------------- The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware extended International Garden Products, Inc., et al.'s exclusive periods to file and solicit acceptances for the proposed Chapter 11 Plan until Aug. 1, 2011, and Sept. 29, respectively. The Court previously entered an order (a) extending the exclusive filing period to May 2, 2011, and (b) extending the exclusive solicitation period to July 1, 2011. About International Garden International Garden Products, Inc. was incorporated in 1996 as a holding company for Iseli Nursery, Inc., California Nursery Supply, Weeks Wholesale Rose Grower, and Old Skagit, Inc. The company's operating businesses, Iseli and Weeks, focus primarily on growing horticultural products for nationwide sale to independent garden centers, landscape suppliers, landscapers and similar parties. Iseli's is known in the industry as the premium source of dwarf conifers, Japanese maples and unique companion plants. Weeks is one of the largest wholesale breeders and growers of premium roses in the U.S. International Garden Products, Inc., and its affiliates filed For Chapter 11 protection (Bankr. Lead Case No. 10-13207) on Oct. 4, 2010. International Garden estimated assets and debts at $10 million to $50 million in its Chapter 11 petition. Andrew R. Remming, Esq., at Morris, Nichols, Arsht & Tunnell, serves as bankruptcy counsel. Bryan Cave LLP is the legal counsel. FTI Consulting is the restructuring advisor. Garden City Group is the claims and notice agent. The debtor-affiliates are Weeks Wholesale Rose Grower (Bankr. D. Del. Case No. 10-13208), California Nursery Supply (Case No. 10-13209), Iseli Nursery, Inc. (Case No. 10-13210), and Old Skagit, Inc. (Case No. 10-13211). INT'L LEASE: Moody's Assigns 'B1' Rating to Sr. Unsecured Notes --------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to International Lease Finance Corporation's (ILFC) benchmark senior unsecured notes, offered in two series maturing 2016 and 2019 (Notes). The firm's B1 corporate family rating and positive outlook are unchanged. The terms of the Notes are consistent with ILFC's existing unsecured debt issuance, including certain restrictions on liens, distributions, and asset transfers. The Notes will rank pari passu with ILFC's other unsecured debt. ILFC will use a portion of the proceeds from the sale of the Notes to purchase existing outstanding notes validly tendered and accepted in the firm's $750 million total cash consideration tender offer. The rating of the Notes is based on ILFC's fundamental credit characteristics and the position of the Notes in ILFC's capital structure. ILFC's rating is based on its leading global franchise positioning, its manageable and relatively balanced geographic, aircraft, and customer risk exposures as well as its resilient operating cash flow. The rating also recognizes the significant progress ILFC has made in restructuring its liabilities, building liquidity and reducing leverage since the beginning of 2010. Contrasting this, Moody's believes that ILFC faces potential challenges relating to sustaining lease margin improvements and generating attractive returns on equity. Other credit challenges include the monoline and cyclical nature of ILFC's business, its exposure to aircraft residual value risks, and its reliance on confidence-sensitive wholesale funding. The rating outlook is positive, reflecting Moody's expectation that ILFC's continued efforts to realign its debt maturities with cash flows and deleverage over the intermediate term should further strengthen its liquidity and capital positions. Moody's could upgrade the ratings if, in addition to building additional liquidity and capital strength, ILFC sustains lease margin improvements as economic and industry conditions recover and demonstrates that it can achieve and maintain an attractive return for its owners. Moody's rates ILFC based on its intrinsic characteristics and does not incorporate an assumption of support from ILFC's parent American International Group, Inc. (AIG) into the rating. No longer a core holding of AIG, ILFC has strengthened its stand- alone profile and transitioned toward greater operating and financial independence, reducing the need for and expectation of AIG support. In its last ILFC rating action dated May 12, 2011, Moody's affirmed ILFC's B1 rating and changed its rating outlook to positive. The principal methodology used in rating ILFC is Analyzing the Credit Risks of Finance Companies, published in October 2000. International Lease Finance Corporation, headquartered in Los Angeles, California, is a major owner-lessor of commercial aircraft. INT'L LEASE: Fitch Expects to Rate $1B Unsecured Notes at 'BB' -------------------------------------------------------------- Fitch Ratings expects to rate International Lease Finance Corp.'s (ILFC) $1 billion senior unsecured notes 'BB'. The long-term Issuer Default Rating (IDR), other debt ratings and Evolving Rating Outlook of ILFC are unaffected by this announcement. Concurrent with the issuance of senior unsecured notes, ILFC has commenced a cash tender offer purchase up to $750 million of certain senior unsecured notes. Thus, a portion of the proceeds generated from the current issuance will be used to purchase tendered existing senior unsecured notes. The remaining proceeds will be used for general corporate purposes, including the repayment of other existing indebtedness. The new notes will rank equally in right of payment with existing senior unsecured debt. Covenants are consistent with previously issued senior unsecured debt including a limitation restricting the ability of ILFC to incur liens to secure indebtedness in excess of 12.5% of ILFC's consolidated net tangible assets. Fitch notes that ILFC's IDR is indicative of the company's creditworthiness on a standalone basis. Based on public commentary, Fitch notes that AIG is not presently pursuing a sale of ILFC. However, Fitch does not view ILFC as a core part of AIG's overall franchise. Fitch believes that AIG will likely continue to take reasonable steps to maximize the value of its investment in ILFC. However, the current ratings do not anticipate further financial support from AIG, if it is needed. Fitch notes that the company continues to make steady progress in managing and lengthening debt maturities, strengthening liquidity and reducing leverage. The company has also replaced all key top level executives who left the firm over the past year, which included the hiring of a new Chief Executive Officer and a Chief Investment Officer. Although ILFC reported a net loss of $394 million in fiscal year (FY) 2010 due to the recognition of a $1.5 billion write-down in the value of certain aircraft, including 59 aircraft that were sold to generate liquidity, Fitch notes that the overall performance of the aircraft fleet remains solid and generated cashflow from operations of $3.3 billion in 2010. Given the diminished need to sell aircraft to generate liquidity, Fitch does not anticipate recognition of write-downs in portfolio value to approach the magnitude recognized last year. Although cashflow from operations will decline due to a reduction in the size of the fleet, overall performance of the fleet is expected to continue to remain solid. Fuel price volatility, particularly for marginal airline operators, and the impact of political unrest in the Middle East are primary concerns that may impair near-term fleet performance and utilization. A significant decline in fleet performance and cashflow or significant further impairment in the underlying value of the fleet would likely generate negative rating momentum. Overall liquidity has been strengthened over the past year. ILFC generated approximately $14 billion in liquidity via various debt issuances, aircraft sales or extensions of credit facilities during 2010 which has reduced the overall need to access capital markets or sell aircraft to meet near-term debt maturities. Also, the company recently closed a $2 billion three-year unsecured revolving bank facility and a $1.5 billion secured banks loan. The Evolving Outlook reflects the uncertain prospects of a potential sale of ILFC, and questions regarding its future market position in the global aircraft leasing sector. Absent an outright sale to a higher-rated entity, likely factors that may lead to a rating upgrade include continued execution of strategic initiatives that strengthen liquidity and reduce leverage to minimize both the impact of cyclical and sector downturns and the overall frequency and magnitude of need to access capital markets. Along with improved liquidity and reduced leverage, Fitch would expect to see continued improvements in operating performance metrics. On a standalone basis, Fitch does not think the current business and funding model would support an upgrade in the IDR to investment grade. Likely factors that may lead to lower ratings include deterioration in financial performance and material decline in operating cashflow, sale to a lower rated entity and renewed difficulties in accessing external funding markets. Fitch expects to assign this rating to ILFC: -- $1 billion senior unsecured notes due in 2016 and 2019 'BB'. Fitch currently rates ILFC and its related subsidiaries: ILFC -- Long-term IDR 'BB'; -- Senior secured debt 'BBB-'; -- Senior unsecured debt 'BB'; -- Preferred stock at 'B'. Delos Aircraft Inc. -- Senior secured debt 'BB'. ILFC E-Capital Trust I -- Preferred stock 'B'. ILFC E-Capital Trust II -- Preferred stock 'B'. The Rating Outlook for ILFC is Evolving. INT'L LEASE: S&P Hikes Rating on Unsecured Debt From 'BB+' ---------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BBB-' corporate credit rating on Los Angeles-based aircraft lessor International Lease Finance Corp. (ILFC) and revised the outlook to stable from negative. "We also raised our rating on the company's senior unsecured debt to 'BBB-' from 'BB+', since we no longer believe the proportion of secured debt in the company's capital structure will increase materially; we also affirmed the other issue ratings," S&P related. "The outlook revision reflects the company's improved liquidity position following recent financings," said Standard & Poor's credit analyst Christopher DeNicolo. "Our ratings on ILFC reflect the company's position as one of the two largest global aircraft lessors, its significant progress in addressing large debt maturities in 2011 and 2012, our expectation of continued satisfactory cash generation in an improving aviation market, and one notch for potential support from its parent company, American International Group Inc. The rating also factors in ILFC's remaining substantial debt maturities in 2013, exposure to the cyclical and competitive global airline industry, and the capital intensity and operating leverage of the aircraft leasing business. We categorize ILFC's business risk profile as satisfactory, its financial risk profile as significant, and its liquidity as adequate." "The upgrade of the unsecured debt reflects our view that the proportion of secured debt to tangible assets, currently around 22%, will likely not increase materially, because the company has demonstrated restored access to unsecured debt. Also, the realizable value of its aircraft fleet (currently $38 billion book value) would likely provide at least 30% recovery for unsecured lenders in a simulated default scenario--the lowest level consistent with equalizing senior unsecured debt ratings with a company's corporate credit rating when we assign recovery ratings. Although we do not assign recovery ratings to ILFC's debt (because its corporate credit rating is investment grade), the recovery analysis is still relevant as an additional input into our analysis of notching unsecured debt relative to the corporate credit rating," according to S&P. The outlook is stable. "We believe that recent financings, in combination with expected cash from operations, should be sufficient to meet ILFC's 2012 debt maturities, although 2013 maturities still exceed cash from operations by $1.2 billion. Although we expect the revenues will decline in 2011 due to the smaller fleet and lower lease rates, net earnings should improve, since we don't expect further large impairment charges. However, we believe earnings will not reach previous levels due mostly to higher interest expense and lower revenues. We do believe credit protection measures will likely improve because of lower debt levels," S&P said. "We could raise the rating if the company is able to match future debt maturities and capital expenditures with annual cash from operations and revolver availability, if debt to capital remains below 75%, and if funds from operations to debt improves to the mid-teen percentage area," Mr. DeNicolo added. "Although less likely, we could lower our ratings on the company if we sense an increased uncertainty about ILFC's ability to repay upcoming debt maturities with new borrowings, proceeds from asset sales, and internal cash generation, or if we feel AIG is less likely to provide supplementary cash infusions, if needed." INVENTIV HEALTH: S&P Puts 'B+' Corp. Credit Rating on Watch Neg. ---------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B+' corporate credit and other ratings on inVentiv Health Inc. on CreditWatch, with negative implications, following the announcement of inVentiv's planned acquisition of mid-size CRO, PharmaNet Development Group. InVentiv recently announced it is acquiring Princeton, N.J.-based contract research organization (CRO) PharmaNet. "While the financial terms of the PharmaNet acquisition were not released, the potential for increased leverage and the company's aggressive pace of acquisitions lead us to believe that ratings may be pressured," said Standard & Poor's credit analyst Arthur Wong. Leverage is already considered high, at more than 5x. InVentiv was acquired by private-equity sponsor Thomas H. Lee Partners and Liberty Lane Partners for $1.1 billion in August 2010 and was initially levered at roughly 6x. The company's early 2011 acquisitions of i3 Global and Campbell Alliance added $475 million in new debt. The acquisition of PharmaNet does expand inVentiv's presence in the large and growing CRO industry, and the combined i3 and PharmaNet will make the company one of the more sizable players in an industry that favors size, scale, and international presence. However, inVentiv will have to integrate the recent acquisitions and successfully compete in the competitive CRO industry, where it has not had a meaningful historical presence. "We will review the company's new leverage profile and its prospects for de-levering before resolving the CreditWatch," S&P added. JAMES RIVER: Closes $475 Million Cash Acquisition of IRP -------------------------------------------------------- James River Coal Company closed the previously announced acquisition of International Resource Partners LP and its affiliated companies for $475 million in an all-cash transaction. The acquisition was financed using a portion of the proceeds from James River Coal's recent sales of 7,647,500 shares of its common stock, $230 million aggregate principal amount of its 3.125% convertible senior notes due 2018 and $275 million aggregate principal amount of its 7.875% senior notes due 2019. About James River Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. The Company's balance sheet at March 31, 2011, showed $1.42 billion in total assets, $971.53 million in total liabilities, and $452.41 million in total shareholders' equity. * * * James River carries a 'B' corporate credit rating from Standard & Poor's Ratings Services, and 'B3' corporate family rating from Moody's Investors Service. As reported by the TCR on March 25, 2011, Moody's Investors Service upgraded James River Coal Company's Corporate Family Rating to 'B3' from 'Caa2'. The rating upgrade reflects post- acquisition potential for significant increase in JRCC's metallurgical coal production, increase in operational diversity within Central Appalachia, and greater access to export markets. The S&P corporate rating was upgraded from 'B-' in March 2011. "The upgrade reflects S&P's view that the IRP acquisition provides James River Coal exposure to the attractive metallurgical coal market," said Standard & Poor's credit analyst Fred Ferraro. "The acquisition also adds management experience in overseas marketing, and expands the company's reserve life. Furthermore, S&P expects that it will be funded in a way that is consistent with the current capital structure so as to maintain the current credit metrics." KB GRADING: Equipment to be Liquidated at Lender-Owned Auction -------------------------------------------------------------- The former KB Grading & Excavating equipment assets will be auctioned Wednesday, July 13 at 10:00 a.m. Mountain Time onsite at 350 Broadford Road in Bellevue, Idaho. Maas Companies Inc of Rochester, Minn., an auction company specializing in real estate, industrial plants, equipment and special assets, will conduct the sale authorized by Regal Financial Bank of Seattle, Wash. Approximately 350 lots of assets include: portable jaw crushing and screening plants, dump trucks, truck tractors, motor scrapers, hydraulic excavators, compactors, forklifts, utility trailers, transport trailers, welders, compressors, machine tools, etc. The auction is a "sit down sale" with video presentation of lots and includes live and internet bidding. Potential buyers are encouraged to inspect equipment during one of the following open houses, since viewing of assets during auction will be limited: Tuesday, July 12 from noon to 5:00 p.m. Mountain Time Wednesday, July 13 from 8:00 to 10:00 a.m. Mountain Time Details of the sale are available at http://www.maascompanies.com/ or by contacting Maas Companies directly at (507) 285-1444. LEHMAN BROTHERS: Glenview Entities' $5.6-Mil. Claims Resolved ------------------------------------------------------------- Lehman Commercial Paper Inc., on the one hand, and GCM Little Arbor Partners, L.P., GCM Little Arbor Institutional Partners, L.P., Glenview Capital Partners, LP, GCM Little Arbor Master Fund, Ltd., Glenview Institutional Partners, L.P., and Glenview Capital Master Fund, Ltd., on the other hand, received approval from the Bankruptcy Court of a stipulation regarding settlement of claims and turnover of certain future payments. Under the stipulation, Claim Nos. 33651, 33653, 33558, 33652, 33650, and 33609 totaling $5,694,132 filed by the Glenview Entities will be disallowed and expunged. The Glenview Entities will retain the bank payments estimated at $4,544,453 received from Deutsche Bank and Morgan Stanley in full settlement, satisfaction, release and discharge of the Glenview Claims. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: PIMCO Paid Premium Price on Lehman Stake --------------------------------------------------------- Pacific Investment Management Company LLC has claims, aggregating approximately $4.6 billion, against Lehman Brothers Holdings Inc. The PIMCO claims against LBHI consist of $4,241,764,904 in senior unsecured claims and $408,875,000 in subordinated unsecured claims. A schedule of the PIMCO holdings in LBHI is available without charge at http://bankrupt.com/misc/LBHI_W&CPIMCO.pdf The PIMCO Schedule itemizes (i) the amount of claims against and interests in the Debtors and certain of their material affiliates that may be voted by PIMCO as of March 31, 2011; (ii) the time of acquisition of each claim or interest; (iii) the nature of claims and interests; and (iv) the amounts of claims or interests in accounts managed, and that may be voted, by PIMCO, the times when acquired, the amounts paid and any sales or other disposition thereof. The disclosure on PIMCO was revealed in a Rule 2019 supplemental verified statement filed with the Court by Gerard Uzzi, Esq., at White & Case LLP, in New York, on May 13, 2011. The PIMCO holdings are related to LBHI debt that PIMCO acquired in the years before LBHI's collapse. PIMCO paid a premium for the LBHI debt, Eric Morath of The Wall Street Journal relates. The Journal, citing a Dow Jones analysis on the PIMCO accounting, notes that PIMCO regularly bought and sold Lehman debt since 1999 and paid an average transaction of 98.7 cents on the dollar. PIMCO is part of the 14-member ad hoc group of Lehman Brothers creditors represented by White & Case LLP. PIMCO ranks as the largest claim holder of the Ad Hoc Group with its $4.6 billion aggregate holdings, followed by Paulson & Co. Inc. at $4.2 billion. The Ad Hoc Group members and their corresponding holdings are: PIMCO $4,698,345,000 Paulson & Co. $4,222,469,502 Taconic Capital Advisors L.P. $2,845,971,880 Canyon Capital Advisors LLC $2,275,982,239 Fir Tree, Inc. $1,924,113,555 Perry Capital LLC $1,130,009,392 Owl Creek Asset Management, L.P. $981,280,476 Gruss Asset Management, L.P. $818,558,305 Calif. Public Employees' Retirement System $431,280,000 County of San Mateo $155,000,000 Fiduciary Counselors Inc. $123,003,409 City of Costa Mesa $5,000,000 Vallejo Sanitation & Flood Control District $4,445,000 City of Fremont $3,958,494 With their combined holdings in LBHI, the Ad Hoc Group hold significant amounts of Lehman's senior unsecured debt, The Journal notes. However, PIMCO is appearing to cut down on its Lehman investment and since the start of the year, has reduced its stake in Lehman debt by $352.7 million, The Journal points out, citing the Dow Jones analysis. The Ad Hoc Group filed an alternative bankruptcy plan for Lehman in December 2010, in an effort to increase their recoveries from the Lehman case. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEVI STRAUSS: Names A. Rohosy as EVP and Pres. of Global Dockers ---------------------------------------------------------------- Levi Strauss & Co. has named Anne Rohosy as Executive Vice President and President, Global Dockers(R). As Dockers(R) President, Rohosy will be responsible for all product, marketing and business operations for the global khaki brand, reporting to Levi Strauss & Co. President & CEO John Anderson. She moves to this Dockers(R) leadership position after two years as a senior vice president, overseeing Levi's(R) brand commercial wholesale operations in the Americas. Prior to joining Levi Strauss & Co., she spent 15 years with Nike. "With more than 20 years of U.S. and international retail experience, Anne has the leadership and strategic expertise to drive Dockers(R) forward and continue the brand's momentum in revitalizing the khaki category," said Anderson. "Anne is well- known in the retail industry for her strong business sense and tremendous relationships with retailers, making her the ideal choice to lead the Dockers(R) brand during this exciting time." "The Dockers(R) brand invented the khaki category and continues to bring innovative, fresh products to consumers today," said Rohosy. "I'm excited to join this talented team that has laid the foundation for a 'khaki revolution.'" Rohosy has deep experience in brand management, sales, consumer- aligned growth strategies and strategic distribution. Prior to her SVP role with Levi's(R), Rohosy led Nike's commercial strategy development and apparel sales in the U.S. and Europe as Director of U.S. Commercial Strategic Development, Director of U.S. Apparel Sales, and Director of American and European Sales. She also previously worked with the global brands Swatch and Liz Claiborne. Dockers(R) products are sold in more than 50 countries around the world, reaching modern male consumers across a variety of stores, ranging from Macy's and Kohl's to Barney's and Urban Outfitters. About Levi Strauss & Co. Headquartered in San Francisco, California, Levi Strauss & Co. -- http://www.levistrauss.com/-- is one of the world's leading branded apparel companies. The Company designs and markets jeans, casual and dress pants, tops, jackets and related accessories, for men, women and children under the Levi's(R), Dockers(R) and Signature by Levi Strauss & Co.(TM). The Company markets its products in three geographic regions: Americas, Europe, and Asia Pacific. The Company reported net income of $149.44 million on $4.33 billion of net sales for the year ended Nov. 28, 2010, compared with net income of $150.71 million on $4.02 billion of net sales for the year ended Nov. 29, 2009. The Company's balance sheet at Nov. 28, 2010 showed $3.14 billion in total assets, $3.34 billion in total liabilities, and a $208.80 million stockholders' deficit. * * * The Company carries a 'B+' corporate credit rating from Standard & Poor's, a 'B1' corporate family rating from Moody's Investors Service and a 'BB-' issuer default rating from Fitch Ratings. As reported by the TCR on March 24, 2011, Fitch Ratings has downgraded its Issuer Default Rating on Levi Strauss & Co. to 'B+' from 'BB-'. The downgrade of the IDR reflects Levi's soft operating trends and margin compression, continued high financial leverage, and Fitch's expectation that Levi's financial profile will not show meaningful improvement in the next one to two years. LIBERTY MEDIA: Moody's Says Ratings Not Affected by Tender Offer ---------------------------------------------------------------- Moody's Investors Service said Liberty Media LLC's B1 Corporate Family Rating (CFR), B1 senior unsecured note ratings and SGL-1 speculative-grade liquidity rating are not affected by Liberty Media Corporation's ("LM Corp", Liberty's parent) announcement that it has offered to acquire 70% of Barnes and Noble, Inc. for $17 per share. Liberty'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 Liberty's core industry and believes Liberty's ratings are comparable to those of other issuers with similar credit risk. Liberty, headquartered in Englewood, Colorado, is a holding company that owns and operates a broad range of electronic retailing, communications, and entertainment businesses and also owns equity and debt positions in a wide variety of technology, media and telecommunications companies. Annual revenue is approximately $11 billion. LOWER BUCKS: Resumes Hyperbaric Medicine Services ------------------------------------------------- Jo Ciavaglia at PhillyBurbs.com notes that Lower Bucks Hospital resumed hyperbaric medicine services after purchasing two $100,000 hyperbaric oxygen chambers for its newly renovated hyperbaric medicine center. About Lower Bucks Hospital Bristol, Pennsylvania-based Lower Bucks Hospital is a non-profit hospital based in Bristol, Pennsylvania. The Hospital is currently licensed to operate 183 beds. Together with affiliates Advanced Primary Care Physicians and Lower Bucks Health Enterprises, Inc., Lower Bucks owns a 36-acre campus with several medical facilities. The Hospital's emergency room serves approximately 30,000 patients annually. For the fiscal year ending June 30, 2009, Lower Bucks had $114 million in consolidated revenues. The Hospital filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No. 10-10239) on Jan. 13, 2010. The Hospital's affiliates -- Lower Bucks Health Enterprises, Inc, and Advanced Primary Care Physicians also filed Chapter 11 petitions. Jeffrey C. Hampton, Esq., and Adam H. Isenberg, at Saul Ewing LLP, assist the Hospital in its restructuring effort. Donlin, Recano & Company, Inc., is the Hospital's claims and notice agent. The Hospital estimated $50 million to $100 million in assets and $50 million to $100 million in liabilities as of the Chapter 11 filing. M&T BANK: DBRS Assigns 'BB' Rating to Perpetual Preferred Stock --------------------------------------------------------------- DBRS Inc. (DBRS) has assigned a rating of BB (high) to M&T Bank Corporation's (M&T or the Company) $500 million issuance of perpetual, non-cumulative preferred stock. The ratings are positioned four notches below M&T's Issuer & Senior Debt rating of A (low), which also carries a Negative trend. This notching is consistent with DBRS's base notching policy for preferred shares issued by A (low) rated entities. M&T expects to use $370 million of the net proceeds from the sale of the preferred stock to redeem a portion of its outstanding TARP preferred shares. Following the repurchase, the Company will have $381.5 million of TARP preferred shares still outstanding. In addition, the acquisition of Wilmington Trust will add an additional $330 million of TARP preferred stock. However, DBRS notes that the Company intends to redeem this amount at the closing of the merger, which is expected in 2Q11. All TARP- related warrants issued to the U.S. Treasury will remain outstanding. Headquartered in Buffalo, New York, M&T Bank Corporation is a bank holding company operating two bank subsidiaries, M&T Bank and M&T Bank, N.A. M&T reported $68 billion in consolidated assets as of March 31, 2011. M&T's tangible common equity and Tier 1 common ratios were 6.44% and 6.78%, respectively, at the end of 1Q11 and its Tier 1 ratio was 9.76%. MAJESTIC CAPITAL: To Hire Michelman & Robinson as Special Counsel ----------------------------------------------------------------- Dow Jones' DBR Small Cap reports that Majestic Capital Ltd. asked permission from the U.S. Bankruptcy Court in Poughkeepsie, N.Y. to hire Michelman & Robinson as special counsel. Headquartered in Poughkeepsie, New York City, Majestic Capital, Ltd., fdba CRM Holdings, Inc., filed for Chapter 11 protection (Bankr. S.D. N.Y. Case No. 11-36225) on April 29, 2011. Affiliates also sought Chapter 11 protection Bankr. S.D. N.Y. Case Nos. 11-36221 - 11-36234) on April 29, 2011. Bankruptcy Judge Cecelia G. Morris presides over the case. Thomas Genova, Esq., at Genova & Malin, Attorneys represents the Debtors in their restructuring effort. Murphy & King, P.C. serves as the Debtors' co-counsel. The Debtors tapped Michelman & Robinson, LLP, as special counsel, and Day Seckler, LLP, as accountants and financial advisors. The Debtor disclosed $436,191,000 in assets and $421,757,000 in liabilities as of Dec. 31, 2010. MARTIN CADILLAC: Chapter 11 Trustee Taps EisnerAmper as Accountant ------------------------------------------------------------------ The Hon. Rosemary Gambardella of the U.S. Bankruotcy Court for the Distict of New Jersey authorized Jay L. Lubetkin, the Chapter 11 trustee in the case of Martin Cadillac, LLC, to retain EisnerAmper, LLP, as his accountant. EisnerAmper is expected to, among other things: -- analyze the Debtor's books and records and compiling financial statements; -- prepare and file monthly operating reports and tax returns of the Debtor as they come due; and -- assist in responding to any inquiries by the Court or creditors regarding the financial condition of the Debtor. To the best of the trustee's knowledge, EisnerAmper is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The trustee is represented by: RABINOWITZ, LUNETKIN & TULLY, LLC Jay L. Lubetkin, Esq. 293 Eisenhower Parkway, Suite 100 Livingdton, NJ 07039 Tel: (973) 597-9100 About Martin Cadillac, LLC Englewood Cliffs, New Jersey-based Martin Cadillac, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10- 29520) on June 25, 2010. Gregory S. Kinoian, Esq., and Paul S. Hollander, Esq., at Okin, Hollander & DeLuca, LLP, represent the Debtor. The Company estimated assets and debts at $10 million to $50 million. MEMC ELECTRONIC: S&P Assigns 'BB' Corporate Credit Rating --------------------------------------------------------- Standard & Poor's Rating Services assigned its 'BB' corporate credit rating to MEMC Electronic Materials Inc. "At the same time, we assigned our 'BB' issue-level rating and a '4' recovery rating to the company's $550 million senior unsecured notes due 2019. The '4' recovery rating indicates that unsecured creditors can expect average (30% to 50%) recovery if a payment default occurs. The outlook is stable," S&P stated. The rating on MEMC reflects a fair business profile and intermediate financial profile. "Our business risk assessment reflects our view of the company's growing exposure to the solar energy industry and its mid-tier competitive position in a highly cyclical industry. Offsetting these weaknesses are the company's internal sourcing of polysilicon, its diversified businesses, its position on the solar value chain, and the market position and project pipeline of its solar power development segment. The intermediate financial profile reflects the necessity for the company to deliver on optimistic growth forecasts and minimize margin compression to maintain stability in its credit metrics," S&P continued. MEMC designs, manufactures, and sells silicon wafers to the semiconductor device and solar industries. In addition, the company develops, finances, monitors, and operates solar photovoltaic power plants. MEMC engages in three reportable industry segments: semiconductors materials, solar materials, and solar energy. "The stable outlook reflects MEMC's market position in different industry segments, with favorable growth prospects and adequate liquidity that can curtail cash flow volatility," said Standard & Poor's credit analyst Theodore Dewitt. A higher rating is possible if management successfully delivers on plans to expand in the solar businesses. We could lower the rating, however, if leverage approaches covenant levels of 2.5x EBITDA, as specified in the credit documents. This could occur because of weaker operating performance due to economic conditions or if the company cannot realize projected growth across its industry segments. MERCANTILE BANCORP: Shareholders Vote to Reelect Ted Awerkamp ------------------------------------------------------------- Mercantile Bancorp, Inc. disclosed the results of its annual meeting of stockholders held May 23. Shareholders re-elected eight directors, ratified the selection of independent auditors, and participated in an open question and answer session. At Monday's meeting, shareholders voted to reelect each of the following as directors for a one-year term: Ted T. Awerkamp, Julie A. Brink, Michael J. Foster, Lee R. Keith, William G. Keller, Jr., Dennis M. Prock, John R. Spake, and James W. Tracy. Additionally, shareholders approved the reappointment of BKD, LLP as independent auditors for the fiscal year ending Dec. 31, 2011. About Mercantile Bancorp Mercantile Bancorp, Inc. (NYSE Amex: MBR) -- http://www.mercbanx.com/-- is a Quincy, Illinois-based bank holding company with wholly-owned subsidiaries consisting of one bank each in Illinois, Kansas, and Florida, where the Company conducts full-service commercial and consumer banking business, engages in mortgage banking, trust services and asset management, and provides other financial services and products. The Company's largest subsidiary, Mercantile Bank, also operates branch offices in Missouri and Indiana. At Dec. 31, 2010, the Company's balance sheet showed $929.18 million in total assets, $935.22 million in total liabilities, and a stockholders' deficit of $6.04 million. As reported in the TCR on April 26, 2011, BKD, LLP, in Decatur, Illinois, expressed substantial doubt about Mercantile Bancorp's ability to continue as a going concern, following the Company's results for 2010. The independent auditors noted that the Company has suffered recurring losses resulting from the effects of the economic downturn causing its subsidiary banks to be undercapitalized and resulting in consent orders to be issued by their primary regulators. The Company reported a net loss of $50.95 million on $24.62 million of net interest income (before provision for loan losses) for 2010, compared with a net loss of $60.38 million on $21.22 million of net interest income (before provision for loan losses) for 2009. MERIT GROUP: Gets $55 Million in Financing From Lender ------------------------------------------------------ Home Channel News notes that Merit Group has obtained a commitment for a $55 million debtor-in-possession financing from its senior lender to continue operations during the reorganization process. But it has announced its intention to explore a possible sale as a strategic alternative. Based in Spartanburg, South Carolina, the Merit Group Inc. formerly Lancaster Distributing Company filed for Chapter 11 bankruptcy protection (Bankr. D. S.C. Lead Case No. 11-03216) on May 17, 2011. Judge Helen E. Burris presides over the case. Michael M. Beal, Esq., McNair Law Firm PA, represents the Debtors. The Debtors selected Kurtzman Carson Consultants LLC as their claims agent; Alvarez & Marsal North America LLC, restructuring consultants; Morgan Joseph Triarisan LLC, investment banker. The Debtors estimated assets of $1 million and $10 million and debts between $50 million and $100 million. MERITAGE HOMES: Fitch Affirms IDR at 'B+'; Outlook Stable --------------------------------------------------------- Fitch Ratings has affirmed its ratings for Meritage Homes Corporation (NYSE: MTH), including the company's Issuer Default Rating (IDR) at 'B+'. The Rating Outlook is Stable. The ratings and Outlook for MTH are influenced by the company's execution of its business model, conservative land policies, geographic and product line diversity, acquisitive orientation and healthy liquidity position. While Fitch expects somewhat better prospects for the housing industry this year, there are still significant challenges facing the housing market, which are likely to meaningfully moderate the early stages of this recovery. Nevertheless, MTH has the financial flexibility to navigate through the still difficult market conditions and continue to selectively and prudently invest in land opportunities. MTH's sales are reasonably dispersed among its 12 metropolitan markets within six states. The company ranks among the top ten builders in such markets as Houston, Dallas/Fort Worth, San Antonio and Austin, TX, Las Vegas, NV, Orlando, FL and Phoenix, AZ. The company also builds in Sacramento, East Bay and Riverside/San Bernardino, CA, Denver, CO and Tucson, AZ. Most recently, MTH entered the Raleigh-Durham, NC market and expects to begin its sales operations there later this year. Historically, about 70 - 75% of MTH's home deliveries are to first and second time trade up buyers, 10 - 15% to entry level buyers, 5% are to luxury home buyers and 5 - 10% to active adult (retiree) buyers. Currently, 60 - 65% of MTH's sales are to entry level and first time move-up buyers. MTH employs conservative land and construction strategies. The company typically options or purchases land only after necessary entitlements have been obtained so that development or construction may begin as market conditions dictate. Under normal circumstances MTH extensively uses lot options, and that is expected to be the future strategy in markets where it is able to do so. The use of non-specific performance rolling options gives the company the ability to renegotiate price/terms or void the option which limits down side risk in market downturns and provides the opportunity to hold land with minimal investment. However, as of March 31, 2011, only 16% of MTH's lots were controlled through options -- a much lower than typical percentage due to considerable option abandonments and write-offs in recent years. Additionally, there are currently fewer opportunities to option lots and, in certain cases, the returns for purchasing lots outright are far better than optioning lots from third parties. Total lots controlled, including those optioned, were approximately 15,437 at March 31, 2011. This represents a 4.3 year supply of total lots controlled and 3.6 year supply of owned land based on trailing 12 months deliveries. MTH successfully managed its balance sheet during the severe housing downturn, allowing the company to accumulate cash and pay down its debt as it pared down inventory. The company had unrestricted cash of $103.5 million and investments and securities of $273.9 million at March 31, 2011. MTH has no major debt maturities until 2015, when $284.4 million of senior notes become due. Fitch expects MTH to be cash flow negative in 2011 as the company continues to rebuild its land position. The company expects to moderately increase its land spending in 2011 from the $236 million spent in 2010. Fitch is comfortable with this strategy given the company's liquidity position and debt maturity schedule. Fitch expects MTH over the next few years to maintain liquidity of at least $200 - 250 million, a level which Fitch believes is appropriate given the challenges still facing the industry. Recent macroeconomic housing statistics (new and existing home sales, single-family housing starts) are weak and disappointing, especially during the month of February, although March statistics have shown some improvement. However, there is a seasonal pick-up in the spring orders compared to the winter. The public builders have reported clear improvement in traffic. In certain markets, selling incentives appear to be rising, to the disadvantage of near-term margins, although new home prices are relatively stable. Builder comparisons are challenging during the first half of 2011 and then ease in the third and fourth quarters. If the economy continues its advance and a moderate number of jobs are added, macroeconomic housing metrics should, for the most part, rise at a single-digit pace this year. Fitch currently projects new single-family housing starts will increase 8.5% in 2011 following 5.8% growth in 2010. After falling 14.4% in 2010, new home sales are forecast to grow about 1.9% in 2011. Fitch expects existing home sales to stay flat in 2011 after a 4.8% decline in 2010. Future ratings and Outlooks will be influenced by broad housing market trends as well as company specific activity, such as trends in land and development spending, general inventory levels, speculative inventory activity (including the impact of high cancellation rates on such activity), gross and net new order activity, debt levels and especially free cash flow trends and uses, and the company's cash position. Negative rating actions could occur if the anticipated recovery in housing does not materialize and the company prematurely steps up its land and development spending, leading to consistent and significant negative quarterly cash flow from operations and diminished liquidity position. Positive rating actions may be considered if the recovery in housing is significantly better than Fitch's current outlook, MTH shows sustained improvement in credit metrics, and the company continues to maintain a healthy liquidity position. Fitch has affirmed these ratings for MTH with a Stable Outlook: -- IDR at 'B+'; -- Senior unsecured debt at 'BB-/RR3'; -- Senior subordinated debt at 'B-/RR6'. The Recovery Rating (RR) of 'RR3' on the company's senior unsecured debt indicates good recovery prospects for holders of these debt issues. MTH's exposure to claims made pursuant to performance bonds and joint venture debt and the possibility that part of these contingent liabilities would have a claim against the company's assets were considered in determining the recovery for the unsecured debt holders. The 'RR6' on MTH's senior subordinated debt indicates poor recovery prospects in a default scenario. Fitch applied a liquidation value analysis for these RRs. MGM RESORTS: Amends WPIP on HKSE Common Stock Listing ----------------------------------------------------- MGM Resorts International made available on its corporate Web site http://www.mgmresorts.com/an amendment to MGM China Holdings Limited's Web Proof Information Pack previously filed on May 9, 2011, and prepared in connection with the proposed listing of the shares of MGM China on The Stock Exchange of Hong Kong Limited for publication on the HKSE's Web site. It is expected that the amended WPIP will be available for viewing and downloading from the HKSE's Web site on or about the morning of May 17, 2011, Hong Kong time (evening of May 16, 2011 U.S. time), at which time the amended WPIP will be posted to and available on the Company's Web site. In addition, the Company anticipates that it will make available on its corporate Web site the price range for the shares to be offered in connection with the Listing which will be posted to and available on the Company's Web site on or about the morning of May 17, 2011, Hong Kong time (evening of May 16, 2011 U.S. time). Because of the time differences between Hong Kong and the United States, the Company plans to continue to use its corporate Web site as a means of posting important information about MGM China in the future. About MGM Resorts MGM Resorts International (NYSE: MGM) -- http://www.mgmresorts.com/-- has significant holdings in gaming, hospitality and entertainment, owns and operates 15 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, Illinois and Macau. The Company's balance sheet at March 31, 2011, showed $18.76 billion in total assets, $15.84 billion in total liabilities and $2.92 billion in total stockholders' equity. The Company reported a net loss of $1.44 billion on $6.01 billion of revenue for the year ended Dec. 31, 2010, compared with a net loss of $1.29 billion on $5.97 billion of revenue during the prior year. * * * As reported by the Troubled Company Reporter on Oct. 18, 2010, Standard & Poor's Ratings Services revised its rating outlook on MGM Resorts to stable from developing. At the same time, S&P affirmed all of its existing ratings on MGM, including the 'CCC+' corporate credit rating. The 'CCC+' corporate credit rating reflects MGM's significant debt burden, S&P's expectation for meaningful declines in cash flow generation in 2010, and the company's weak liquidity position. While MGM maintains a leading presence on the Las Vegas Strip, 2010 will be another challenging year for the Strip, and prospects for a meaningful rebound in 2011 are uncertain. The recent pricing of the primary offering of common stock has bolstered liquidity; however, the company's ability to weather the current downturn and continue to service its debt obligations over the longer term relies on continued progress toward addressing its challenging debt maturity schedule, as well as a substantial rebound in cash flow generation. The TCR also reported that Fitch Ratings revised the Rating Outlook for MGM Resorts to Positive following the company's equity issuance. In addition, Fitch affirmed the Issuer Default Rating at 'CCC'. MGM's 'CCC' IDR continues to reflect a credit profile with substantial credit risk. MGM's probability of default still displays a high sensitivity to an uninterrupted recovery in the Las Vegas market, significant reliance on a favorable refinancing and capital markets environment due to its heavy debt maturity schedule, a highly leveraged balance sheet despite potential debt reduction from the equity issuance, and a weak near-term free cash profile. In addition, MGM's obligation under the CityCenter completion guarantee continues to escalate, and Fitch believes the company is currently under-investing in its properties, which will likely impact asset quality. As reported by the TCR on March 4, 2011, Moody's upgraded MGM Resorts International's Corporate Family rating to B3 and its Probability of Default rating to Caa1. The upgrade reflects signs of modest improvement in demand trends in Las Vegas, debt repayment during 2010 from the proceeds of equity issuances, and completion of a new multi-year financing package for CityCenter (MGM's 50% owned project on the Las Vegas Strip.) MICHAELS STORES: Tampering Probe Won't Affect Moody's Ratings ------------------------------------------------------------- Moody's Investors Service commented that Michaels Stores, Inc.'s investigation in a PIN pad tampering incident has no immediate impact on the company's B3 Corporate Family Rating or its positive rating outlook. The principal methodologies used in this rating were Global Retail Industry published in December 2006, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009 Michaels Stores, Inc. is the largest dedicated arts and crafts specialty retailer in North America. The company operated 1,045 Michaels stores in 49 states and Canada and 137 Aaron Brothers stores as of its most recent fiscal year end. MONEYGRAM INT'L: Amends From S-3 for $500-Mil. Offering ------------------------------------------------------- MoneyGram International, Inc., filed with the U.S. Securities and Exchange Commission Amendment No. 1 to Form S-3 registration statement, under which the Company may sell common stock, preferred stock, depository shares, debt securities, guarantees of debt securities, warrants, rights and units in one or more offerings up to a total dollar amount of $500,000,000. The debt securities described in the prospectus may be fully and unconditionally guaranteed by one or more of the Company's subsidiaries. The Company may offer and sell these securities directly or to or through underwriters, agents or dealers at prevailing market prices or at prices different from prevailing market prices. The Company's common stock is traded on the New York Stock Exchange under the symbol "MGI." The last reported sales price of the Company's common stock on May 12, 2011, was $3.52. The Company has not yet determined whether any of the other securities it is registering hereby will be listed on any exchange, interdealer quotation system or over-the-counter system. If the Company decides to seek a listing for any of its other securities, the Company will disclose that in a prospectus supplement. A full-text copy of the amended prospectus is available for free at http://is.gd/0pchVc About MoneyGram International MoneyGram International, Inc. (NYSE: MGI) -- http://www.moneygram.com/-- is a global payment services company. The Company's major products and services include global money transfers, money orders and payment processing solutions for financial institutions and retail customers. MoneyGram is a New York Stock Exchange-listed company with 203,000 global money transfer agent locations in 191 countries and territories. The Company reported net income of $43.80 million on $1.17 billion of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $1.91 million on $1.16 billion of total revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $4.97 billion in total assets, $4.90 billion in total liabilities, $1.03 billion in total mezzanine equity, and a $955.76 million total stockholders' deficit. * * * According to the Troubled Company Reporter on July 1, 2010, Fitch Ratings has affirmed the Issuer Default Ratings for MoneyGram International Inc. and MoneyGram Payment Systems Worldwide, Inc., at 'B+'. Outlook is stable. Fitch noted that the ratings could be negatively impacted by further declines in remittance volumes driven by macro economic factors or decreases in migrant labor populations worldwide. MP-TECH AMERICA: Taps CBRE and AccuVal Associates as Appraisers --------------------------------------------------------------- MP-Tech America, LLC, asks the U.S. Bankruptcy Court for the Middle District of Alabama for permission to employ CB Richard Ellis, Inc. and AccuVal Associates, Inc., as real estate, equipment and machinery appraisers. CBRE to facilitate the sale of the Debtor's operating assets and will complete the appraisal within three weeks from the date of the engagement. The appraisal will be designed to determine the fair market value of the real estate and plant as a going concern. CBRE will be paid a fee of $5,500 plus expenses upon execution and approval of the agreement to commence work. AccuVal will appraise the machinery and equipment of the Debtor at Cusseta, Alabama to determine the fair market value of those assets, utilizing a standard of fair market value in continued use with assumed earnings, assuming that the Debtor's machinery and equipment will be evaluated as operating assets as part of an operating facility. AccuVal will complete the appraised within three weeks from the date of the engagement. AccuVal will be paid a fee of $10,500 plus expenses with a deposit of $5,250 upon execution and approval of the agreement. To the best of the Debtor's knowledge, CBRE and AccuVal are "disinterested persons" as that term is defined in Section 101(14) of the Bankruptcy Code. About MP-Tech America Cusseta, Alabama-based MP-Tech America, LLC, is the maker of parts for Kia Motors Corp. and Hyundai Motor Co. at their plants in Georgia and Alabama. It filed a Chapter 11 petition (Bankr. M.D. Ala. Case No. 11-30895) on April 8, 2011. The Debtor estimated assets and debts of $10 million to $50 million as of the Chapter 11 filing. The Debtor has a $15 million secured debt to Korea Development Bank. The Debtor has tapped Fritz Hughes & Hill LLC in Montgomery, Alabama, as co-counsel. MP-TECH AMERICA: Taps Burton & Armstrong as Bankruptcy Counsel -------------------------------------------------------------- The Hon. Dwight H. Williams, Jr., of the U.S. Bankruptcy Court for the Middle District of Alabama authorized MP-Tech America, LLC, to employ Burton & Armstrong LLP as bankruptcy counsel. As reported in the Troubled Company Reporter on April 21, 2011, B&A is preparing the Debtor's schedules, statements of affairs and other pleadings; counseling the Debtor with respect to its power as debtor-in-possession; representing the Debtor in administrative matters and adversary proceedings, and performing all legal services for the Debtor. B&A will be paid at its normal hourly rates, which is $395 for services of Joseph J. Burton, Jr., Esq., $350 for Rosemary S. Armstrong, Esq., and $100 for paralegals. B&A received a $50,000 retainer and $1,039 filing fee from MP- Tech. B&A paid local counsel, Fritz & Hughes LLC, a $3,000 retainer from the fees. The Debtor also discloses that B&A has been paid $8,250 for prepetition services from the retainer. Mr. Burton, a partner at B&A, assured the Court that his firm represents no adverse interest to the Debtor or the bankruptcy estate in the matters upon which the firm is to be engaged. About MP-Tech America Cusseta, Alabama-based MP-Tech America, LLC, is the maker of parts for Kia Motors Corp. and Hyundai Motor Co. at their plants in Georgia and Alabama. It filed a Chapter 11 petition (Bankr. M.D. Ala. Case No. 11-30895) on April 8, 2011. The Debtor estimated assets and debts of $10 million to $50 million as of the Chapter 11 filing. The Debtor has a $15 million secured debt to Korea Development Bank. The Debtor has tapped Fritz Hughes & Hill LLC in Montgomery, Alabama, as co-counsel. MPG OFFICE: Caspian Capital Owns 8.6% of Preferred Shares --------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Caspian Capital LP and its affiliates disclosed that they beneficially own 863,047 shares of MPG Office Trust, Inc.'s 7.625% Series A Cumulative Redeemable Preferred Stock, Par Value $.01 per share, representing 8.6% of the shares outstanding. A full-text copy of the filing is available for free at http://is.gd/KtXvDp About MPG Office Trust MPG Office Trust, Inc., fka Maguire Properties Inc. -- http://www.mpgoffice.com/-- is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high- quality office properties in the Southern California market. MPG Office Trust is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. The Company's balance sheet at March 31, 2011, showed $2.72 billion in total assets, $3.80 billion in total liabilities, and a $1.08 billion in total deficit. The Company reported a net loss of $197.94 million on $406.89 million of total revenue for the year ended Dec. 31 2010, compared with a net loss of $869.72 million on $423.84 million of total revenue during the prior year. The Company has been focused on reducing debt, eliminating repayment and debt service guarantees, extending debt maturities and disposing of properties with negative cash flow. The first phase of the Company's restructuring efforts is substantially complete and resulted in the resolution of 18 assets, relieving the Company of approximately $2.0 billion of debt obligations and potential guaranties of approximately $150 million. MOHEGAN TRIBAL: Reports $24.7-Mil. Net Income in March 31 Qtr. -------------------------------------------------------------- Mohegan Tribal Gaming Authority filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income of $24.74 million on $347.94 million of net revenues for the three months ended March 31, 2011, compared with net income of $19.48 million on $352.29 million of net revenues for the same period a year ago. The Company also reported net income of $37.22 million on $683.55 million of net revenues for the six months ended March 31, 2011, compared with net income of $23.37 million on $694.10 million of net revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $2.17 billion in total assets, $2.01 billion in total liabilities, and $161.66 million in total capital. A full-text copy of the Form 10-Q is available for free at: http://is.gd/eZPyvz About Mohegan Tribal Headquartered in Uncasville, Conn., Mohegan Tribal Gaming Authority conducts and regulates gaming activities on Tribal lands, which are federally recognized Indian tribe reservations in southeastern Connecticut. The Authority has noted that its Bank Credit Facility matures on March 9, 2012 and its 2002 Senior Subordinated Notes mature on April 1, 2012. In addition, a substantial portion of the Authority's remaining indebtedness matures over the following three fiscal years. The Authority believes that it will need to refinance all or part of its indebtedness at or prior to each maturity thereof in order to maintain sufficient resources for its operations. The Authority has engaged Blackstone Advisory Partners, L.P. to assist in its strategic planning relating to its debt maturities. * * * At the end of November 2010, Moody's Investors Service downgraded Mohegan Tribal Gaming Authority's Corporate Family and Probability of Default ratings to Caa2 from B3. All of MTGA's rated long-term debt was also lowered. The rating outlook is negative. The ratings downgrade reflects Moody's view that MTGA could find it difficult to refinance significant upcoming debt maturities without some impairment to bondholders given its high leverage -- debt/EBITDA is over 7 times -- limited near-term growth prospects for Mohegan Sun Casino, the likely continuation of weak consumer gaming demand trends in the Northeastern U.S., and the strong possibility of gaming in Massachusetts. The company's $675 million revolver ($527 million outstanding at Sept. 30, 2010) expires in March 2012 and its $250 million 8% senior subordinated notes mature in April 2012. Combined, these debt items account for about 50% of MTGA's total debt outstanding. MTGA has announced that it hired Blackstone Group to help deal with its capital structure issues, although no details have been made available regarding MTGA's options. Given the company's recently announced weak fiscal fourth quarter results along with the significant near- and long-term challenges previously mentioned, Moody's believes a restructuring that involves some impairment to bondholders will be considered. The negative ratings outlook reflects the relatively short time frame in which MTGA has to address what Moody's believes to be a significant capital structure issue. If MTGA is not able to refinance by March 2011 its $675 million revolver will be become current. The same holds true for the company's $250 million 8% senior subordinated notes to the extent these notes are not refinanced by April 1, 2011. NO FEAR RETAIL: Wants Until Aug. 23 to Propose Reorganization Plan ------------------------------------------------------------------ No Fear Retail Stores, Inc., et al., ask the U.S. Bankruptcy Court for the Southern District of California, to extend their exclusive periods to file and solicit acceptances for the proposed chapter 11 plan until Aug. 23, 2011, and Oct. 22, respectively. The Debtors also request that the Court convene a hearing on the requested exclusivity extension before June 24. The Debtors' exclusive periods is set to expire on June 24. About No Fear Retail Carlsbad, California-based No Fear Retail Stores, Inc., is a retailer of action, sports, and casual youth lifestyle apparel and accessories, targeting young adults and teens. It operates 41 retail locations in California, Oregon, Arizona, Florida, Nevada, North Carolina, and Texas. Simo Holdings Inc. disclosed that it had a 52% share in the company. That entity developed the No Fear brand and is mostly owned by founding brothers Brian and Mark Simo, each of whom own about 38% of the company. No Fear filed for Chapter 11 bankruptcy protection (Bankr. S.D. Calif. Case No. 11-02896) on Feb. 24, 2011. David S. Kupetz, Esq., at Sulmeyer, Kupetz, A Professional Corp, 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. Affiliates No Fear MX, Inc. (Bankr. S.D. Calif. Case No. 11-02897) and Simo Holdings, Inc. (Bankr. S.D. Calif. Case No. 11-02898) filed separate Chapter 11 petitions on Feb. 24, 2011. Tiffany L. Carroll, the Acting U.S. Trustee for Region 15, appointed three creditors to serve on an Official Committee of Unsecured Creditors of No Fear MX, Inc. NO FEAR RETAIL: Taps Venturi & Company as Financial Advisors ------------------------------------------------------------ No Fear Retail Stores, Inc., et al., ask the U.S. Bankruptcy Court for the Southern District of California for permission to employ Venturi & Company LLC, as financial advisors. The Debtors relate that they attempt to secure a third party financing, while pursuing a reorganization that likely would result in a smaller store base, a reduction in corporate overhead, and a focus on licensing of the Debtors' established brands in order to create a smaller, profitable entity going forward. Venturi & Company will assist with respect to obtaining debtor-in- possession financing, developing and presenting a plan of reorganization, well as assist with other financial issues facing the Debtors. Venturi & Company's compensation will consist of: (i) a fee of $30,000 plus reimbursement of out-of-pocket-expenses; and a 5% transaction fee of the total value of the transaction. Venturi & Company received $30,000 in funds prior to the Petition Date. To the best of the Debtors' knowledge, Venturi & Company is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About No Fear Retail Carlsbad, California-based No Fear Retail Stores, Inc., is a retailer of action, sports, and casual youth lifestyle apparel and accessories, targeting young adults and teens. It operates 41 retail locations in California, Oregon, Arizona, Florida, Nevada, North Carolina, and Texas. Simo Holdings Inc. disclosed that it had a 52% share in the company. That entity developed the No Fear brand and is mostly owned by founding brothers Brian and Mark Simo, each of whom own about 38% of the company. No Fear filed for Chapter 11 bankruptcy protection (Bankr. S.D. Calif. Case No. 11-02896) on Feb. 24, 2011. David S. Kupetz, Esq., at Sulmeyer, Kupetz, A Professional Corp, 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. Affiliates No Fear MX, Inc. (Bankr. S.D. Calif. Case No. 11-02897) and Simo Holdings, Inc. (Bankr. S.D. Calif. Case No. 11-02898) filed separate Chapter 11 petitions on Feb. 24, 2011. Tiffany L. Carroll, the Acting U.S. Trustee for Region 15, appointed three creditors to serve on an Official Committee of Unsecured Creditors of No Fear MX, Inc. NO FEAR RETAIL: Wants Until Sept. 22 to Accept and Reject Leases ---------------------------------------------------------------- No Fear Retail Stores, Inc., et al., ask the U.S. Bankruptcy Court for the Southern District of California to extend from June 24, 2011, to Sept. 22, 2011, the deadline to assume or reject unexpired non-residential real property leases. About No Fear Retail Carlsbad, California-based No Fear Retail Stores, Inc., is a retailer of action, sports, and casual youth lifestyle apparel and accessories, targeting young adults and teens. It operates 41 retail locations in California, Oregon, Arizona, Florida, Nevada, North Carolina, and Texas. Simo Holdings Inc. disclosed that it had a 52% share in the company. That entity developed the No Fear brand and is mostly owned by founding brothers Brian and Mark Simo, each of whom own about 38% of the company. No Fear filed for Chapter 11 bankruptcy protection (Bankr. S.D. Calif. Case No. 11-02896) on Feb. 24, 2011. David S. Kupetz, Esq., at Sulmeyer, Kupetz, A Professional Corp, serves as the Debtor's bankruptcy counsel. The Debtors tapped Venturi & Company LLC, as their financial advisors. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. Affiliates No Fear MX, Inc. (Bankr. S.D. Calif. Case No. 11-02897) and Simo Holdings, Inc. (Bankr. S.D. Calif. Case No. 11-02898) filed separate Chapter 11 petitions on Feb. 24, 2011. Tiffany L. Carroll, the Acting U.S. Trustee for Region 15, appointed three creditors to serve on an Official Committee of Unsecured Creditors of No Fear MX, Inc. NORTH AMERICAN PETROLEUM: Amends Schedules of Assets and Debts -------------------------------------------------------------- North American Petroleum Corp. filed with the U.S. Bankruptcy Court for the District of Delaware amended schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $140,678,983 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $111,584,367 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $13,903,854 ----------- ----------- TOTAL $140,678,983 $125,488,121 Petroflow Energy Ltd. filed its amended schedules, disclosing $17,083 in assets and $108,741,965 in liabilities. Full-text copies of the amended schedules are available for free at http://bankrupt.com/misc/NAPETROLEUM_petroflowsal.pdf http://bankrupt.com/misc/NAPETROLEUM_sal.pdf About North American Petroleum Denver, Colorado-based North American Petroleum Corp. USA is a natural gas driller. North American Petroleum and Prize Petroleum are subsidiaries of Petroflow Energy Ltd. North American Petroleum sought Chapter 11 protection (Bankr. D. Del. Case No. 10-11707) on May 25, 2010. In its schedules, North American Petroleum disclosed $140,678,983 in total assets and $125,595,183 in total liabilities as of the Petition Date. The Debtor's affiliate, Prize Petroleum LLC, filed a separate Chapter 11 petition on May 25, 2010 (Case No. 10-11708). Prize Petroleum scheduled $121,945,092 in liabilities. These cases are being jointly administered for procedural purposes, under the case docket for North American Petroleum Corporation USA, Case No. 10-11707. On Aug. 20, 2010, Petroflow Energy Ltd., the parent company of North American Petroleum Corporation USA and Prize Petroleum, LLC, filed a petition in the U.S. Bankruptcy Court for the District of Delaware seeking relief under Chapter 11 of the Bankruptcy Code (Case No. 10-12608). On Sept. 10, 2010, the Bankruptcy Court granted permission for Petroflow's Chapter 11 case to be jointly administered with those of its two Chapter 11 debtor-affiliates. On September 17, 2010, Petroflow received recognition of the U.S. Chapter 11 proceedings from the Alberta Court of Queen's Bench under the Companies' Creditors Arrangement Act in Canada. In its petition, Petroflow disclosed assets and debts of between $100 million and $500 million each. David R. Seligman, Esq., Ryan Blaine Bennett, Esq., and Paul Wierbicki, Esq., at Kirkland & Ellis LLP, in Chicago, serve as lead bankruptcy counsel. Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP in Wilmington, Del., and Morton R. Branzburg, Esq., at Klehr Harrison Harvey Branzburg LLP, in Philadephia, Pa., serve as the Debtors' co-counsel. Kinetic Advisors LLC is the Debtors' financial advisor. Epiq Bankruptcy Solutions, LLC, is the Debtors' notice, claims and balloting agent. NORTH AMERICAN PETROLEUM: Kinetic Advisors to Aid in Restructuring ------------------------------------------------------------------ The Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware authorized North American Petroleum Corporation USA, et al., to employ Kinetic Advisors, LLC as restructuring advisor. Kinetic is expected to, among other things: -- work with the senior management and other employees of the Debtors and their advisors to provide financial consulting services and restructuring advice, including the evaluation of various restructuring and financing alternatives; -- assist the Debtors with the preparation of their statements of financial affairs, schedules, monthly operating reports and other regular reports required in the Chapter 11 cases and in contract rejection analysis; -- assist the Debtors in various motions and pleadings to be filed in the Chapter 11 cases, and render testimony, as required from time to time, regarding any of the matters to which Kinetic is providing services; and -- provide certain additional services in connection with the marketing of the Debtors' assets and solidification of exit and other financing. The hourly rates of Kinetic's personnel are: Senior Managing Directors $500 - $700 Managing Directors and Directors $300 - $500 Managers, Associates, and Paraprofessionals $150 - $300 To the best of the Debtors' knowledge, Kinetic is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About North American Petroleum Denver, Colorado-based North American Petroleum Corp. USA is a natural gas driller. North American Petroleum and Prize Petroleum are subsidiaries of Petroflow Energy Ltd. North American Petroleum sought Chapter 11 protection (Bankr. D. Del. Case No. 10-11707) on May 25, 2010. In its schedules, North American Petroleum disclosed $140,678,983 in total assets and $125,595,183 in total liabilities as of the Petition Date. The Debtor's affiliate, Prize Petroleum LLC, filed a separate Chapter 11 petition on May 25, 2010 (Case No. 10-11708). Prize Petroleum scheduled $121,945,092 in liabilities. These cases are being jointly administered for procedural purposes, under the case docket for North American Petroleum Corporation USA, Case No. 10-11707. On Aug. 20, 2010, Petroflow Energy Ltd., the parent company of North American Petroleum Corporation USA and Prize Petroleum, LLC, filed a petition in the U.S. Bankruptcy Court for the District of Delaware seeking relief under Chapter 11 of the Bankruptcy Code (Case No. 10-12608). On Sept. 10, 2010, the Bankruptcy Court granted permission for Petroflow's Chapter 11 case to be jointly administered with those of its two Chapter 11 debtor-affiliates. On September 17, 2010, Petroflow received recognition of the U.S. Chapter 11 proceedings from the Alberta Court of Queen's Bench under the Companies' Creditors Arrangement Act in Canada. In its petition, Petroflow disclosed assets and debts of between $100 million and $500 million each. David R. Seligman, Esq., Ryan Blaine Bennett, Esq., and Paul Wierbicki, Esq., at Kirkland & Ellis LLP, in Chicago, serve as lead bankruptcy counsel. Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP in Wilmington, Del., and Morton R. Branzburg, Esq., at Klehr Harrison Harvey Branzburg LLP, in Philadephia, Pa., serve as the Debtors' co-counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' notice, claims and balloting agent. NORTH AMERICAN PETROLEUM: Pays Off Lender With Sale --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that North American Petroleum Corp. USA received bankruptcy court approval for a settlement agreement on May 17 that pays the secured lender in full and opens the door to filing a Chapter 11 plan. The settlement, according to the company's court filing, will give "substantial recovery" to unsecured creditors while allowing the "reinstatement" of the existing stock. The settlement ends disputes over how much was owed to an affiliate of Equal Energy Ltd. under a farm-out agreement. Mr. Rochelle relates that in the triangular settlement, Equal will buy North American's Oklahoma properties for a gross cash price of $93.5 million. North American in turn will pay $98 million for full payment of the bank debt to secured lender Texas Capital Bank NA. Equal will waive claims against North American. The lender will receive 70% of certain future state tax refunds. North American said the settlement "brings closure to nearly all outstanding issues in these cases." The settlement, according to the report, was the result of rulings by the bankruptcy judge following a trial involving North American, the lender and Equal. Although the second phase of the trial was yet to be held, North American said that the ruling appeared to mean it would recover $26 million from Equal. About North American Petroleum Denver, Colorado-based North American Petroleum Corp. USA is a natural gas driller. North American Petroleum and Prize Petroleum are subsidiaries of Petroflow Energy Ltd. North American Petroleum sought Chapter 11 protection (Bankr. D. Del. Case No. 10-11707) on May 25, 2010. In its schedules, North American Petroleum disclosed $140,678,983 in total assets and $125,595,183 in total liabilities as of the Petition Date. The Debtor's affiliate, Prize Petroleum LLC, filed a separate Chapter 11 petition on May 25, 2010 (Bankr. D. Del. Case No. 10-11708). Prize Petroleum scheduled $121,945,092 in liabilities. These cases are being jointly administered for procedural purposes, under the North American Petroleum docket. Petroflow Energy Ltd., the parent company of North American Petroleum Corporation USA and Prize Petroleum, LLC, filed a Chapter 11 petition (Bankr. D. Del. Case No. 10-12608) on Aug. 20, 2010. On Sept. 10, 2010, the Bankruptcy Court granted permission for Petroflow's Chapter 11 case to be jointly administered with those of its two Chapter 11 debtor-affiliates. On Sept. 17, 2010, Petroflow received recognition of the U.S. Chapter 11 proceedings from the Alberta Court of Queen's Bench under the Companies' Creditors Arrangement Act in Canada. In its petition, Petroflow disclosed $100 million to $500 million in assets and debts. David R. Seligman, Esq., Ryan Blaine Bennett, Esq., and Paul Wierbicki, Esq., at Kirkland & Ellis LLP, in Chicago, serve as lead bankruptcy counsel. Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP in Wilmington, Delaware, and Morton R. Branzburg, Esq., at Klehr Harrison Harvey Branzburg LLP, in Philadephia, Pennsylvania, serve as the Debtors' co-counsel. Kinetic Advisors LLC is the Debtors' financial advisor. Epiq Bankruptcy Solutions, LLC, is the Debtors' notice, claims and balloting agent. NORTHGATE CROSSING: Sec. 341 Creditors' Meeting on June 10 ---------------------------------------------------------- The United States Trustee for the Central District of California will convene a meeting of creditors in the bankruptcy case of NorthGate Crossing LLC, c/o Oresund Capital LLC, on June 10, 2011, at 2:30 p.m. at RM 200C, 3685 Main Street, 2nd Floor, Riverside, California. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in the Debtors' bankruptcy cases. Attendance by the Debtors' creditors at the meeting is welcome, but not required. The Section 341(a) meeting offers the creditors a one-time opportunity to examine the Debtor's representative under oath about the Debtor's financial affairs and operations that would be of interest to the general body of creditors. NorthGate Crossing LLC owns and plans to develop a roughly 88-acre mixed use tract of real property located in the city of Indio, Riverside County, California. The planned project includes commercial retail spaces, single family residences and a hotel. NorthGate Crossing LLC, c/o Oresund Capital LLC, filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-24944) on May 5, 2011. Judge Scott C. Clarkson presides over the case. The Debtor is represented by Richard H. Golubow, Esq., at Winthrop Couchot, as bankruptcy counsel. In its Scheduled, the Debtor disclosed assets of $27,502,421 and debts of $29,015,903. NOVADEL PHARMA: Posts $2.6 Million First Quarter Net Loss --------------------------------------------------------- Novadel Pharma Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $2.6 million on $65,000 of revenues for the three months ended March 31, 2011, compared with a net loss of $1.3 million on $129,000 of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $2.7 million in total assets, $9.4 million in total liabilities, and a stockholders' deficit of $6.7 million. As reported in the TCR on April 1, 2011, J.H. Cohn LLP, in Roseland, New Jersey, expressed substantial doubt about Novadel Pharma's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations and negative cash flows from operating activities. A complete text of the Form 10-Q is available for free at: http://is.gd/bpfcIe About NovaDel Pharma Bridgewater, N.J.-based NovaDel Pharma Inc. (OTC BB: NVDL) -- http://www.novadel.com/-- is a specialty pharmaceutical company that develops oral spray formulations of marketed pharmaceutical products. The Company's patented oral spray drug delivery technology seeks to improve the efficacy, safety, patient compliance, and patient convenience for a broad range of prescription pharmaceuticals. OIL STATES: Moody's Rates New 600-Mil. Senior Notes at 'Ba3' ------------------------------------------------------------ Moody's Investors Service assigned a Ba3 rating to Oil States International, Inc.'s (OIS) new $600 million senior notes due 2019. Moody's also assigned a first time Corporate Family Rating (CFR) of Ba2 and a SGL-3 Speculative Grade Liquidity (SGL) rating. The rating outlook is stable. Net proceeds from the new notes will be used to repay $484 million of borrowings outstanding under the company's revolving credit facility as of March 31, 2011, resulting in an increase in total debt of $116 million. Pro forma Debt / EBITDA will be 2.4x. The transaction increases financial flexibility to help fund planned 2011 capital expenditures, which are heavily weighted toward OIS' Accommodations business segment. RATINGS RATIONALE "The Ba2 CFR reflects the mix between the company's inherently volatile North American services segments and its more stable Accommodations and Offshore Products segments, strong geographic and segment diversification, good market positions within its various business lines, and scale which is consistent with similarly rated peers," commented Jonathan Kalmanoff, Moody's Analyst. "The rating also considers the recent increase in leverage, from previously very low levels to levels currently in line with peers, as OIS aggressively outspends cash flow to expand its Accommodations business and funds negative free cash flow with debt." March 31, 2011 pro forma liquidity consists of $201 million of cash, $483.5 million of availability under the U.S. revolving credit facility, and $250 million of availability under the Canadian revolving credit facility. OIS also has a $75 million Australian credit facility, which is undrawn. We anticipate that the company has more than enough liquidity to fund negative free cash flow and any debt maturities over the next twelve months. Covenants under the credit facility include EBITDA / Interest of at least 3.0x, Debt / EBITDA of no more than 3.5x for 2011 then stepping down to 3.25x in 2012 and 3.0x in 2013. As of March 31, 2011 pro forma, OIS was well within these limits with Total Debt / EBITDA of 2.2x and EBITDA / Interest of 8.5x as calculated for the purposes of covenant compliance. Near term debt maturities consist of $17 million in 2011 and $32 million in 2012. The company's $175 million of convertible notes are also callable in July of 2012. The majority of the company's assets are pledged as collateral under the credit facility, which limits the extent to which asset sales could provide a source of additional liquidity if needed. The Ba3 senior unsecured note rating reflects OIS' overall probability of default, to which Moody's assigns a PDR of Ba2, and a loss given default of LGD4-69%. The size of the senior secured revolver's potential priority claim relative to the senior unsecured notes results in the notes being rated one notch beneath the Ba2 CFR under Moody's Loss Given Default Methodology. The rating could be lowered if Debt / EBITDA were expected to be sustained at 3.5x or higher as a result of debt funding of capital expenditures, or if there were a deterioration in the fundamentals of any of the company's business lines. The rating could be raised if Debt / EBITDA were expected to be sustained below 2.0x through the business cycle. Over the longer term, reduced business risk due to growth in the less volatile Accommodations and Offshore Products segments, as well as increases in scale and diversification, could lead to positive ratings action. The principal methodology used in rating Oil States was the Global Oilfield Services 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 Oil States International, Inc., headquartered in Houston, TX., manufactures, owns, and runs housing accommodations for the oil and gas and mining industries, provides oilfield services for North American onshore exploration and production companies, and manufactures and services products used in offshore oil and gas exploration and production. OIL STATES: S&P Gives 'BB' Corp. Credit Rating; Outlook Stable -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' corporate credit rating to Houston, Texas-based Oil States International Inc. (OIS). "At the same time, we assigned 'BB' issue ratings and '4' recovery ratings to the company's planned $600 million senior unsecured note issuance due 2019 and its existing $175 million convertible senior notes due 2025. The '4' recovery rating indicates our expectation of average (30% to 50%) recovery in the event of a payment default," S&P noted. The company plans to use the proceeds to repay existing borrowings under its revolving credit facilities and for general corporate purposes. Approximately $1.1 billion of pro forma debt will be outstanding at the close of the planned transaction. "The ratings on Oil States International reflect the company's fair business risk profile due its geographic concentration in Canada and Australia in its accommodations business segment, exposure to the inherent volatility of onshore and offshore drilling activity in its offshore products, well site services and low margin tubular services business segments, and more aggressive growth strategy with the MAC Services Group acquisition in late 2010 and significant planned increases in capital expenditures for 2011," said Standard & Poor's credit analyst Patrick Jeffrey. Ratings also reflect OIS' strong liquidity and moderate debt leverage pro forma for the planned note issue, some product diversification among its four business segments, and good near- term growth prospects for its accommodations business segment. "We believe that OIS' higher margin accommodations business segment, which represents more than 50% of the company's EBITDA, provides some stability to its overall operations as its customer base typically has long-term operating strategies in the key Canadian oil sands and Australia markets that result in recurring accommodation needs. OIS also has a degree of operating flexibility and low operating leverage in this segment, allowing it to reduce costs and capital expenditures somewhat should demand decline. OIS has a good market position, growing and diversifying this business through the acquisition of MAC Services Group Ltd. in December 2010. The MAC acquisition added more than 5,200 rooms in Australia to its existing 7,500 plus rooms in the Canadian oil sands region. We expect OIS will spend a substantial portion of its planned $625 million in capital expenditures in 2011 to increase its room inventory in these markets. Although we expect near-term growth prospects to remain favorable, we believe the company's operations remain vulnerable to a decrease in oil and gas capital investment, particularly if oil prices face a substantial and prolonged decline," elaborated S&P. "Despite favorable near-term growth prospects for the company's offshore products, well site services, and tubular services businesses, primarily due to higher oil prices, we believe these business segments have more inherent volatility to their operations than the accommodations segment and are lower margin. The offshore products segment competes with larger competitors such as Cameron International Corp. (BBB+/Stable/--) and FMC Technologies (BBB/Stable/A-2) and was affected in fiscal 2010 by the Gulf of Mexico drilling moratorium. The well site services and tubular services businesses are extremely volatile and also compete with larger competitors such as Schlumberger Ltd. (A+/Stable/A-1) and Halliburton Co. (A/Negative/A-1). Demand is primarily correlated with onshore rig counts in the U.S. Although the U.S. rig count has increased in 2010 as companies have focused on drilling activities in liquids rich plays such as the Eagleford Shale and Bakken Shale, they declined significantly in 2009 due to declines in oil and natural gas prices," S&P continued. According to S&P, "The outlook is stable. We believe good near- term growth prospects for the company's existing business segments should result in OIS maintaining debt leverage in the 2x to 3x area in 2011 as it funds its increased capital expenditure program. We would consider a positive rating action if the company improves and sustains debt leverage below 2x and demonstrates a commitment to managing its growth and operations consistent with a higher rating. We would consider a negative rating action if the company increases debt leverage above 4x without near-term prospects for material debt reduction." OK ETON: Hearing on Case Conversion Plea Continued Until July 5 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Texas has continued until July 5, 2011, the hearing to consider the request to dismiss or convert the Chapter 11 case of OK Eton Square, LP to one under Chapter 7 of the Bankruptcy Code. As reported in the Troubled Company Reporter on Dec. 13, 2010, the U.S. Trustee explained that the Debtor has not provided the U.S. Trustee Guidelines with evidence of the existence of a debtor-in- possession bank account. The operating report for October 2010 showed that the Debtor has a bank balance of $154,287, but some postpetition debt is unpaid. The U.S. Trustee stated that further delay of the case is prejudicial to creditors. OK Eton Square, LP, based in Dallas, Texas, filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case No. 10-33583) on May 24, 2010. Judge Barbara J. Houser presides over the case. The Debtor is represented by Eric A. Liepins, Esq., at Eric A. Liepins, P.C., in Dallas, Texas. The Debtor estimated assets and debts at $10 million to $50 million in its Chapter 11 petition. OMNICOMM SYSTEMS: Posts $3.9-Mil. First Quarter Net Loss -------------------------------------------------------- OmniComm Systems, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $3.9 million on $3.3 million of revenues for the three months ended March 31, 2011, compared with a net loss of $1.5 million on $2.7 million of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $3.0 million in total assets, $24.7 million in total liabilities, and a stockholders' deficit of $21.7 million. Webb & Company, P.A., in Boynton Beach, Fla., expressed substantial doubt about OmniComm Systems' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has a net loss attributable to common shareholders of $3,335,869, a negative cash flow from operations of $1,953,919, a working capital deficiency of $9,400,947 and a stockholders' deficiency of $17,814,029. A complete text of the Form 10-Q is available for free at: http://is.gd/Abjhfw Ft. Lauderdale, Fla.-based OmniComm Systems, Inc. (OTC: OMCM.OB) -- http://www.OmniComm.com/-- provides customer-driven Internet solutions to pharmaceutical, biotechnology, research and medical device organizations that conduct life changing clinical trial research. ORBITAL SCIENCE: Moody's Affirms 'Ba1' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service has affirmed the Ba1 corporate family and probability of default ratings of Orbital Sciences Corporation. Concurrently, Moody's assigned a Baa3 rating to Orbital's planned $300 million first-lien revolving credit facility which will replace their existing $100 million revolver due 2012. In addition, a first-time speculative grade liquidity rating of SGL-1 was assigned on the company. The rating outlook is stable. The ratings are: -- Corporate family, affirmed at Ba1 -- Probability of default, affirmed at Ba1 -- $300 million first-lien revolver due 2016, assigned Baa3 LGD 2, 26% -- $100 million first lien revolver due 2012, unchanged at Baa3 LGD 2, 20%, to be withdrawn at close -- Speculative grade liquidity, assigned SGL-1 RATINGS RATIONALE The Ba1 CFR reflects the company's sizable backlog and conservative debt level, strong established position within the small rockets/space systems niche, and a very good liquidity profile. The company's $5.6 billion backlog provides visibility and adds confidence of, at least, sustained revenues over 2011- 2012. The rating contemplates EBITDA margin continuing at around 10% with debt to EBITDA of around 2x. These positive considerations offset the likelihood of near-term negative free cash flow as working capital growth and elevated capital spending continue across 2011. This is a continuation of the 2010 pattern as increased development work and greater fixed price versus cost- plus based work in the revenue mix drives working capital growth. Positive free cash flow should return, and thereafter continue, at some point in 2012. The lack of consistent free cash flow generation, limited size versus rated sector peers, and potential that Orbital could pursue a substantial acquisition to widen its product breadth constrain the rating. The speculative grade liquidity rating of SGL-1, denoting very good liquidity, considers the company's high cash balance, lack of near-term debt maturities and large size of the planned revolver. As of March 31, 2011 Orbital held $264 million of cash and had no borrowing under its $100 million revolving credit facility (to be replaced by the $300 million revolving credit facility). Upward rating momentum would depend on materially greater revenue scale, expectation of debt to EBITDA of 2x or less with consistent free cash flow to debt of 10%+, and a good liquidity profile. Downward rating pressure would develop with debt to EBITDA over 3x, EBIT to interest below 3x, or if we expect low free cash flow for an extended period. The principal methodology used in this rating was Global Aerospace and Defense published in June 2010. Orbital Sciences Corporation, headquartered in Dulles, Virginia, manufactures small space and missile systems for commercial, civil government and military customers. For the last twelve months ended March 21, 2011 revenues were $1.3 billion. PETROLEUM & FRANCHISE: Wants to Solicit Plan Votes Until July 29 ---------------------------------------------------------------- Petroleum & Franchise Capital, LLC and Petroleum & Franchise Funding, LLC, ask the U.S. Bankruptcy Court for the District Of Connecticut to extend until July 29, 2011, the time to solicit acceptances of their Second Amended Plan of Reorganization, dated Oct. 22, 2010, The Debtors related they need more time to resolve their differences with DZ Bank to submit a consensual Plan. To date, the efforts have not been successful. At the same time, DZ Bank filed a motion for a relief from the automatic stay seeking to terminate the Debtors' right to manage and operate as a debtor-in- possession based upon alleged defaults under prepetition loan documents. As reported in the Troubled Company Reporter on Oct. 25, 2010, according to the Disclosure Statement, the Plan provides for (a) the continued operations of PFF as the surviving successor entity by way of corporate merger; and (b) payment in full of all holders of Allowed Claims with interest and (c) retention of Allowed Interests. Under the Plan, DZ Bank will receive with respect to the DZ Secured Claims: (i) the DZ Promissory Note, which will be issued by the Reorganized Debtor in the principal amount of the Allowed DZ Secured Claims plus any interest or other fees, subject to Bankruptcy Court approval, accrued thereon during the Chapter 11 case. DZ Bank AG Deutsche Zentral-Genossenschafts Bank, Frankfurt am Main, serves as agent and for the benefit of itself and Autobahn Funding Company, LLC. Each Holder of an Allowed General Unsecured Claim in Class 3 will receive from the Debtors quarterly cash payments of 12.5% of its Allowed Claim, commencing with the first full calendar quarter after the Effective Date and continuing until all Allowed General Unsecured Claim in Class 3 are paid in full, totaling the Allowed amount of the claim in full satisfaction, settlement, release and discharge of and in exchange for the claim. The sources of cash necessary for the Reorganized Debtor to pay Allowed Claims under the Plan will be: (a) the cash of the Reorganized Debtor on hand as of the Effective Date; (b) cash arising from the operation, ownership, maintenance, and sale of the assets owned, managed, or serviced by or at the direction of the Debtors, including, without limitation, the DZ collateral; (c) any cash generated or received by the Reorganized Debtor after the Effective Date from any other source, including, without limitation, any recoveries from the prosecution of all causes of action and revenues from new loans generated by the Reorganized Debtor as of the Effective Date. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/Petroleum&Franchise_DS.pdf About Petroleum & Franchise Danbury, Connecticut-based Petroleum & Franchise Capital, LLC, filed for Chapter 11 bankruptcy protection on June 23, 2010 (Bankr. D. Conn. Case No. 10-51465). Craig I. Lifland, Esq., and James Berman, Esq., at Zeisler and Zeisler, assist the Company in its restructuring effort. The Company estimated assets and debts at $50 million to $100 million. Petroleum & Franchise Funding, LLC, an affiliate of the Debtor, a filed separate Chapter 11 petition on June 23, 2010 (Case No. 10- 51467). The Company disclosed $66,132,915 in assets and $54,782,604 in liabilities as of the Chapter 11 filing. PJ FINANCE: Torchlight Seeks to Terminate Right to Use Cash ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the secured lender to PJ Finance Co., not content to wait until the June 1 hearing on its motion to dismiss the Chapter 11 case, filed an emergency motion on May 18 to discontinue the Debtor's use of cash collateral. PJ Finance answered the allegations the same day. According to the report, Torchlight Loan Services LLC, the special servicer for $475 million in mortgage-backed securities, contends PJ Finance violated the order granting the use of cash representing collateral for its secured claim by failing to provide weekly reports showing budget compliance and by exceeding a 10% variation on line items in the budgets. PJ Finance responded by saying it has taken "remedial measures" to ensure timely filing of weekly reports. As for excessive spending, it says that overall expenses are below budget, although some items exceeded predictions. Torchlight wants the case converted to liquidation in Chapter 7 if the judge isn't inclined to dismiss. About PJ Finance Chicago, Illinois-based PJ Finance Company, LLC, owns apartment communities in the states of Arizona, Florida, Georgia, Tennessee and Texas. PJ Finance owns or holds ownership interests in 32 apartment communities that collectively have more than 9,500 rentable units. It has 20 apartment locations in Texas, and the remaining 12 in Arizona, Florida, Georgia and Tennessee. The day- to-day operations of the portfolio are managed by a third party, WestCorp Management Group One, Inc. PJ Finance and various affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-10688). Michelle E. Marino, Esq., and Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware, serve as bankruptcy counsel. Kurtzman Carson Consultants, LLC, is the Debtors' claims and notice agent. Christopher A. Jarvinen, Esq., and Mark T. Power, Esq., at Hahn & Hessen LLP, represent the official committee of unsecured creditors as lead counsel. Richard Scott Cobb, Esq., and William E. Chipman, Jr., Esq., at Landis Rath & Cobb, in Wilmington, Del., serve as the committee's local counsel. The Debtors estimated total assets of at least $275 million (estimated value of portfolio securing loan to Bank of America) and total debts of at least $479 million ($475 million owed to BofA, $4.4 million trade debt). PJ Finance said it has a commitment for Gaia Real Estate Investments LLC to invest $42 million and serve as the foundation for a reorganization plan. PLY GEM HOLDINGS: Incurs $70.9-Mil. Net Loss for April 2 Quarter ---------------------------------------------------------------- Ply Gem Holdings, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $70.89 million on $200.10 million of net sales for the three months ended April 2, 2011, compared with net income of $54.10 million on $204.20 million of net sales for the three months ended April 3, 2010. The Company's balance sheet at April 2, 2011, showed $971.93 million in total assets, $1.21 billion in total liabilities, and a $242.97 million total stockholders' deficit. Gary E. Robinette, President and CEO, said "Ply Gem's first quarter 2011 sales and Adjusted EBITDA continue to reflect the challenging conditions that exist in the housing market today. Despite single family housing starts being down 21% from the prior year, Ply Gem's sales only showed a modest decline, reflecting a significant new customer win in the first quarter and further demonstrating our ability to gain profitable market share." A full-text copy of the Form 10-Q is available for free at: http://is.gd/qGF7lW About Ply Gem Based in Cary, North Carolina, Ply Gem Holdings Inc. is a diversified manufacturer of residential and commercial building products, which are sold primarily in the United States and Canada, and include a wide variety of products for the residential and commercial construction, the do-it-yourself and the professional remodeling and renovation markets. In May 2010, Standard & Poor's Ratings Services raised its (unsolicited) corporate credit rating on Ply Gem to 'B-' from 'CCC+'. "The ratings upgrade reflects our expectation that the company's credit measures are likely to improve modestly over the next several quarters to levels that we would consider more in line with the 'B-' corporate credit rating," said Standard & Poor's credit analyst Tobias Crabtree. SGS International carries a 'B1' corporate family rating from Moody's Investors Service. POLI-GOLD LLC: Taps Keller Williams as Real Estate Listing Broker ----------------------------------------------------------------- The Hon. Randolph J. Haines of the U.S. Bankruptcy Court for the District Of Arizona authorized Poli-Gold, L.L.C., to employ Keller Williams River Cities Specialists as real estate listing broker. KWRCS is marketing the Debtor's property at 2980 Highway 95, Fort Mohave, Arizona. Ronald R. Love, the listing agent employed by KWRCS, told tha Court that the firm will receive a 6% commission, if KWRCS procures a successful sale of the property. KWRCS has an exclusive listing, which means that it will work with both seller and buyers. Additionally, if a broker/agent not employed by KWRCS produce a buyer which results in an actual sale of the property, KWRCS will be responsible for payment of any co-brokerage fees to be paid to the participating broker, which are typically a 3% commission. All commissions will be paid from sales proceeds at the time of close of escrow, and commissions will be paid only upon the sale, lease, transfer or conveyance of the property. To the best of the Debtor's knowledge, KWRCS is a disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Poli-Gold Fort Mohave, Arizona-based Poli-Gold, LLC, owns a cabin and RV resort in Panguitch, Utah. It also owns a commercial building/warehouse/storage facility in Fort Mohave, Arizona, as well as a commercial property in Lake Havasu City, Arizona, and some vacant lots in Kingman, Arizona. Poli-Gold filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 10-37018) on Nov. 17, 2010. Attorneys at Engelman Berger, P.C., serve as the Debtor's bankruptcy counsel. In its schedules, the Debtor disclosed assets of $30,384,943 and liabilities of $14,401,515 as of the petition date. PONIARD PHARMA: Files Form 10-Q; Posts $3.2MM Net Loss in Q1 2011 ----------------------------------------------------------------- Poniard Pharmaceuticals, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $3.2 million for the three months ended March 31, 2011, compared with a net loss of $11.9 million for the same period last year. To date, the Company has not received any revenues from sales of picoplatin. The Company's balance sheet at March 31, 2011, showed $12.2 million in total assets, $2.9 million in total liabilities, and stockholders' equity of $9.3 million. "The Company is seeking to address its liquidity needs by exploring strategic alternatives potentially available to it, including a merger with or acquisition by another company, the sale or licensing of the Company's assets, a partnership, or recapitalization of the Company," the Company said in the filing. "In addition, the Company is continuously evaluating measures to reduce its costs and preserve additional capital. If the Company is unable to secure additional capital to fund working capital and capital expenditure requirements and/or complete a strategic transaction in a timely manner, it may be forced to explore liquidation alternatives, including seeking protection from creditors through the application of bankruptcy laws." As reported in the TCR on April 6, 2011, Ernst & Young LLP, in Palo Alto, Calif., expressed substantial doubt about Poniard Pharmaceuticals' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred recurring operating losses and negative cash flows from operations. A complete text of the Form 10-Q is available for free at: http://is.gd/beex1F San Fracisco, Calif.-based Poniard Pharmaceuticals, Inc. (Nasdaq: PARD) -- http://www.poniard.com/-- is a biopharmaceutical company focused on the development and commercialization of innovative oncology products. The Company's lead product candidate is picoplatin, a chemotherapeutic designed to treat solid tumors that are resistant to existing platinum-based cancer therapies. POWER EFFICIENCY: Posts $870,700 First Quarter Net Loss ------------------------------------------------------- Power Efficiency Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $870,666 on $158,605 of revenues for the three months ended March 31, 2011, compared with a net loss of $282,368 on $110,030 of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $4.3 million in total assets, $1.2 million in total liabilities, and stockholders' equity of $3.1 million. As reported in the TCR on April 6, 2011, BDO USA, LLP, in Las Vegas, Nevada, expressed substantial doubt about Power Efficiency's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses and has generated negative cash flows from operations. A complete text of the Form 10-Q is available for free at: http://is.gd/qZNw59 Las Vegas, Nevada-based Power Efficiency Corporation (OTC: PEFF) - - http://www.powerefficiency.com/-- is a clean technology company focused on efficiency technologies for electric motors. PRM REALTY: Wants Until May 31 to Propose Reorganization Plan ------------------------------------------------------------- Peter R. Morris and PRM Realty Group, LLC, ask the U.S. Bankruptcy Court for the Northern District Of Texas to extend their exclusive periods to file and solicit acceptances for the proposed Plan of Reorganization until May 31, 2011, and July 29, respectively. The Debtors relate they need the additional extension of the exclusivity deadlines to accommodate Mr. Morris' illness and treatment and to provide additional time for Mr. Morris to obtain funding for a plan of reorganization in these difficult capital markets. Mr. Morris, president and chief executive officer of PRM. On March 23, Mr. Morris underwent the lung biopsy to understand the root causes of his pulmonary issues and identify an effective course of treatment. Mr. Morris spent six days and nights in the hospital recuperating and continues to recuperate at home. PRM is represented by: Gerrit M. Pronske, Esq. Rakhee V. Patel, Esq. Melanie P. Goolsby, Esq. PRONSKE & PATEL, P.C. 2200 Ross Avenue, Suite 5350 Dallas, TX 75201 Tel: (214) 658-6500 Fax: (214) 658-6509 E-mail: gpronske@pronskepatel.com rpatel@pronskepatel.com mgoolsby@pronskepatel.com Mr. Morris is represented by: J. Mark Chevallier, Esq. James G. Rea, Esq. MCGUIRE, CRADDOCK & STROTHER, P.C. 2501 N. Harwood, Suite 1800 Dallas, TX 75201 Tel: (214) 954-6807 Fax: (214) 954-6850 E-mail: mchevallier@mcslaw.com jrea@mcslaw.com About PRM Realty Group Chicago, Illinois-based PRM Realty Group, LLC, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-30241) on Jan. 6, 2010. The Company's affiliates -- Peter R. Morris; Bon Secour Partners, LLC; PM Transportation, LLC; Rangeline Properties, LLC; PRS II, LLC; and Morris Radio Enterprises, LLC -- filed separate Chapter 11 bankruptcy petitions. Gerrit M. Pronske, Esq., at Pronske & Patel, P.C., assists PRM Realty in its bankruptcy effort. PRM Realty disclosed $34,054,818 in assets and $225,611,600 in liabilities as of the Petition Date. No committee of unsecured creditors has been appointed. PROFESSIONAL VETERINARY: Plan Exclusivity Extended Until Aug. 15 ---------------------------------------------------------------- The Hon. Timothy J. Mahoney of the U.S. Bankruptcy Court for the District Of Nebraska extended Professional Veterinary Products, Ltd, et al.'s exclusive period to solicit acceptances for the proposed Chapter 11 Plan until Aug. 15, 2011. The Debtors said that creditors Direct Vet Marketing, Inc., and Agri-Laboratories, Ltd. agreed to a limited stay regarding approval of the Disclosure Statement. The Debtors related that they still have to pursue the contested matter and move toward liquidation and determination of DVM's claim, before they can obtain approval of the Disclosure Statement, and obtain confirmation of the proposed Plan or an amendment thereto. The Plan As reported in the Troubled Company Reporter on Dec. 29, 2010, the Debtors and the Official Committee of Unsecured Creditors submitted a proposed Plan of Liquidation and an explanatory Disclosure Statement. According to the Disclosure Statement, the Plan will facilitate the final liquidation of the Debtors' estates and the distribution of the proceeds obtained therefrom to holders of allowed claims. Upon the Effective Date, any and all remaining assets of the Debtors and their estates, including (a) all Unencumbered assets and (b) all cash, will be transferred to, and vest in, the Liquidating Trust, subject to any lien that is not waived, released or discharged on the Effective Date of the Plan; all assets will constitute the Trust Estate, subject to those liens. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/PROFESSIONALVETERINARY_DS.pdf About Professional Veterinary Products Professional Veterinary Products Ltd. -- http://www.pvpl.com/-- operates a veterinary supply company owned and managed by veterinarians. Professional Veterinary sought Chapter 11 protection from creditors on August 20, 2010, in Omaha, Nebraska (Bankr. D. Neb. Case No. 10-82436). Affiliates ProConn and Exact Logistics also filed for Chapter 11. The Company reported $89.79 million in total assets, $78.23 million in total liabilities, and $11.56 million in stockholders' equity at April 30, 2010. The Company hired McGrath North Mullin & Kratz PC LLC, as bankruptcy counsel and Alliance Management as financial and restructuring advisors. PURADYN FILTER: Posts $326,400 First Quarter Net Loss ----------------------------------------------------- Puradyn Filter Technologies Incorporated filed its quarterly report on Form 10-Q, reporting a net loss of $326,437 on $883,392 of sales for the three months ended March 31, 2011, compared with a net loss of $269,067 on $674,261 of sales for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.5 million in total assets, $8.3 million in total liabilities, and a stockholders' deficit of $6.8 million. As reported in the TCR on April 13, 2011, Webb and Company, P.A., in Boynton Beach, Fla., expressed substantial doubt about PuraDdn Filter Technologies' ability to continue as a going concern, following the Company's 2010 financial results. The independent auditors noted that the Company has suffered recurring losses from operations, its total liabilities exceed its total assets, and it has relied on cash inflows from an institutional investor and current stockholder. A complete text of the Form 10-Q is available for free at: http://is.gd/tLilK7 Boynton Beach, Fla.-based Puradyn Filter Technologies Incorporated (OTC BB: PFTI) -- http://www.puradyn.com/-- designs, manufactures and markets the puraDYN(R) Oil Filtration System. REALTY EXECUTIVES: Owes $400,000 in Debt to Johnson Bank -------------------------------------------------------- The Business Journal reports that Realty Executives Inc. said it owes $400,000 to Johnson Bank. The bank's CEO Russ Weyers has said the bank's loan portfolio in Arizona was hard-hit and in late 2010 accounted for about two-thirds of the bank's problem loans overall. Based in Phoenix, Arizona, Realty Executives Inc. filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 11- 12497) on April 30, 2011. Judge Randolph J. Haines presides over the case. Andrew Hardenbrook, Esq., Steven D. Jerome, Esq., and Blake T. Hardwick, Esq., at Snell & Wilmer LLP, and, Paul Sala, Esq., at Allen, Sala & Bayne PLC, represent the Debtor. The Debtor estimated both assets and debts of between $1 million and $10 million. RIVER ISLAND: Wants to Sell Residential Property for $3,950,000 --------------------------------------------------------------- River Island Farms, Inc., asks the U.S. Bankruptcy Court for the Southern District of Florida for permission to sell one of its residential properties William P. and Michelle Y. Noglows. The Debtor has entered into a purchase and sale agreement for the sale of a residence -- 2521 Mercedes Drive, Ft. Lauderdale, Florida -- for $3,950,000, an all cash transaction without a financing contingency. The Debtor believes that, although the sale price is $750,000 less than the amount invested by Debtor in the cost of the dwelling, in the current market it is reasonable. The Debtor relates that the property is subject to a mortgage with Gibraltar with a principal balance of $2,500,000 together with accrued interest, fees and other charges estimated to be approximately $250,000. The sale is "as is" without warranty, except for title. The sale is not subject to a higher and better offer nor is an auction of the property proposed by the seller. The Debtor adds that the proceeds of the sale will generate funds in excess of the amount required to satisfy the indebtedness owed Gibraltar on the subject property, including arrears for interest and other charges. The excess funds are to be retained by the Debtor and are to be used for limited purposes in the pending chapter 11 proceedings. Gibraltar has consented to the sale conditioned on the use of the proceeds. About River Island Farms, Inc. Fort Lauderdale, Florida-based River Island Farms, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 11- 15410) on Feb. 28, 2011. Martin L. Sandler, Esq., at Sandler & Sandler By M. L. Sandler, P.A., serves as the Debtor's bankruptcy counsel. The Debtor estimated assets and debts at $10 million to $50 million. The U.S. Trustee has not been appointed an official committee of unsecured creditors in the Debtor's case. RQB RESORT: Wants to Get Goldman Sachs' Consent on Courses Deal --------------------------------------------------------------- RQB Resort LP and RQB Development LP ask the U.S. Bankruptcy Court for the Middle District of Florida, for the third time, to further extend their exclusive periods to file a Chapter 11 plan until Sept. 1, 2011, and solicit acceptances of that plan until Nov. 1. The Debtors need additional time to negotiate a resolution of issues with Goldman Sachs before a court-appointed mediator; and provide time for investors to complete due diligence based on the resort's $132 million valuation. The Debtors are still uncertain as to whether the assets will be owned by the reorganized Debtors once the investment. The Debtors explains that Goldman Sachs refused to consent the Restated Courses Agreement. The Debtors relate that the Restated Courses Agreement will add substantial value to the Debtors' estates by , among other things, (i) providing the Debtors with the right to sell 450 golf memberships in the Tournament Players' Club, Inc., and (ii) permitting the Debtors to charge the resort's guest a variable market rate to play golf at the TPC courses rather than the lower fixed rate the Debtors were allowed to charges the original courses agreement. The restated courses agreement will also allow the Debtors to generate approximately $700,000 per year in upcharge income. and the TPC memberships will have a present value of between $9.8 and $22.5 million. About RQB Resort RQB Resort LP and RQB Development LP own Florida's Sawgrass Marriott Resort, the site of the U.S. PGA Tour's Tournament Players Championship. Ponte Vedra Beach, Florida-based RQB Resort, LP, aka Sawgrass Marriott Resort & Cabana Club, filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. M.D. Fla. Case No. 10-01596). The Company's affiliate -- RQB Development, LP, aka Sawgrass Marriott Golf Villas & Spa -- filed a separate Chapter 11 petition. The Company estimated its assets and debts at $100 million to $500 million in its Chapter 11 petition. SAN JOAQUIN: Fitch Affirms 'BB' Rating on $2.08B Revenue Bonds -------------------------------------------------------------- Fitch Ratings has affirmed the underlying 'BB' rating on the San Joaquin Hills Transportation Corridor Agency (SJHTCA, or the agency), California's outstanding bonds: -- $220 million senior lien toll road revenue bonds, series 1993; -- Insured portion of the toll road refunding revenue bonds, series 1997A; -- Uninsured portion of the toll road refunding revenue bonds, series 1997A. The Rating Outlook is revised to Stable from Negative. The revision to Stable reflects the restructuring of debt service that is expected to provide considerable financial flexibility in the near term, the indenture amendments that require the agency to adjust tolls such that they produce the maximum amount of toll revenues, and the requirement to build internal liquidity of the toll stabilization fund to $664 million before the funds become surplus revenues. In addition, traffic and revenue performance on the 15-mile limited access highway (the facility or corridor) has started to show signs of a slow recovery. Rating Rationale: -- An established base of traffic of approximately 25 million and the corridor's role as a congestion reliever in Orange and Riverside Counties. -- Management's demonstrated willingness to raise rates in the face of challenging economic and political circumstances and moderate economic rate-making flexibility due to the weak service area and presence of competing facilities. -- Sufficient cash reserves of more than $350 million in fiscal 2010 (ended June 30), including previous mitigation payments from the Foothill/Eastern Transportation Corridor Agency (F/ETCA), are available for debt service payments. -- High leverage of approximately 17.0 times (x) and a debt service schedule that will increase significantly in fiscal years 2025-2034 by 90%. SJHTCA is dependent on continued toll rate increases and traffic and revenue growth throughout the life of the debt to maintain coverage levels at or above 1.0x. -- The revised debt service profile is expected to provide considerable flexibility in the next 10 years to manage the unpredictable pace of traffic and revenue growth. -- Modified covenant package marginally weakens the legal structure; however, this is largely mitigated by the agency's efforts to establish a stronger base of traffic with more moderate pricing and its historical track record of acting in the interest of bondholders. Key Rating Drivers: -- The region's economic outlook and its effect on employment and traffic performance. -- The traffic and revenue impact of toll rate adjustments that will be implemented when net toll revenues are projected to be less than 1.3x total annual debt service of the bonds prior to the restructuring and the facility's continued economic rate-making flexibility in the face of a longer- dated debt profile. Security: The bonds are secured by a net pledge of toll revenue collected at the mainline and ramp toll plazas and a portion of development impact fees (DIF) assessed in the corridor. SJHTCA is authorized to retain $2.5 million of the DIF annually to be used for planning, environmental, and construction purposes. Credit Summary: The agency has increased toll rates more than 10 times since 1996 resulting in toll revenues (excluding fees and fines) of approximately $87.1 million in fiscal 2010 -- flat over fiscal 2009 and down nearly 5% from the peak of $91.4 million in fiscal 2008. Notably, the fiscal 2009 toll increase resulted in a traffic decline of nearly 11% as well as the first year-over-year revenue decline since the facility's opening (5.5%). Had the facility continued to experience negative revenue after the fiscal 2010 toll increase, Fitch believes the corridor could have been at its revenue maximization point. Instead, the fiscal 2010 toll increase resulted in a small 0.78% growth in revenues despite a 5.6% decline in traffic to 25.3 million, the lowest on the facility since fiscal 1999 of 24.9 million. Additionally, traffic and revenues are up 0.95% and 1.95%, respectively for year-to-date fiscal 2011 (July to March), possibly indicating the beginning of a recovery. Management did not implement a toll increase in fiscal 2011 due to economic conditions but is proposing to the board of directors that toll rates be increased in fiscal 2012. The current cash toll rate per mile on the facility of $0.37 per mile is one of the highest for Fitch-rated toll roads in the U.S. Key changes to the legal structure and covenant package include: -- The maturity dates on $430 million of convertible capital appreciation bonds (CCABs, or restructured bonds) have shifted to 2037-2042 from 2018-2024, effectively extending the final maturity of the bonds by six years. -- Accordingly, the cooperative agreement between the California Department of Transportation (Caltrans), which is responsible for the corridor's upkeep, and SJHTCA was modified to allow SJHTCA to collect tolls until Dec. 31, 2050 (or until the debt is paid off, whichever occurs first). -- Restructured debt service obligations are lower in each year until 2025, providing some near-term financial flexibility. -- A portion of the restructured bonds' interest payments is junior to all other debt service obligations in 2025-2036. The interest is subordinate in the flow of funds but a failure to pay interest amounts when due will constitute an event of default on all senior and junior lien obligations and all liens are subject to the same acceleration remedies. -- A lower debt service coverage ratio (DSCR) requirement of 1.0x from 1.3x. -- Inclusion of the agency's various cash funded reserves in the rate covenant definition to meet the revised DSCR requirement. -- Requirement before each fiscal year to set toll rates to optimize toll revenues based on the traffic consultant's recommendation and subject to certain restrictions. Debt service coverage for fiscal 2010 -- including the use of $28.7 million drawn from the toll rate stabilization fund (TRSF) - was 1.34x, or much lower at 0.94x without the liquidity draw. Fiscal 2011 coverage is budgeted to be 1.32x and 0.88x, respectively; management does not anticipate drawing from the TRSF in fiscal 2012, primarily due to the proposed toll increase and lower debt service. In 2010, Fitch noted the near-term financial challenges the SJHTCA would face given the 16% increase in debt service obligations in fiscal 2012 and similar increases every three to four years until 2033. The debt restructuring has lowered the obligations by an average of 30% in each of fiscal years 2012 to 2024. As a result, in Fitch's base case scenario debt service coverage is expected to be at least 1.0x and rising over time. Traffic is projected to grow, but only moderately at a 1.9% compound annual growth rate (CAGR) through fiscal 2042 while revenue grows at a 5% CAGR, which is below pre-crisis growth rates of 9.6% between fiscal years 2000-2007. This scenario requires minimal draws on internal liquidity. Under Fitch's stress case scenario, which assumes lower traffic and revenue CAGRs of 1% and 3.9%, respectively, larger draws on liquidity are required to meet debt service obligations and importantly, neither scenario results in a payment default. SATELITES MEXICANOS: Can Hire Rubio Villegas as Mexican Counsel --------------------------------------------------------------- Satelites Mexicanos, S.A. de C.V., et al., obtained authorization from the Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware to employ the law firm of Rubio Villegas & Asociados, S.C., as special Mexican corporate and regulatory counsel, effective as of the Petition Date. As reported by the Troubled Company Reporter on April 14, 2011, the Debtors sought court authorization to, among other things: a. provide advice regarding corporate matters as they relate to Mexican law; b. advise the Debtors on issues relating to orbital concessions held by the Debtors as well as certain network concessions held by Enlaces Integra, S. de R.L. de C.V.; c. provide analysis, opinions and advice regarding legal and regulatory matters including interpreting certain agreements between the Debtors and certain Mexican government agencies; and d. provide advice regarding the preparation, filing, follow up and delivery of regulatory approvals and regulatory advice in connection with the restructuring process. The hourly rates applicable to the principal attorneys and paralegals proposed to represent the Debtors in their Chapter 11 cases are: Name of Lawyer Rate/Hour -------------- --------- Luis Rubio Barnetche $385 Arturo Banuelos Navarro $250 Bertha Alicia Ordaz Aviles $240 Ivonne Moreno Vera $240 Octavio Lecona Morales $240 Lilian Dorado Quijano $220 Carlos Camargo Tovar $150 Rubio Villegas' current hourly rates for this matter range: Professional Rate/Hour ------------ --------- Partners $250-$385 Associates $120-$240 Law Clerks, Paralegals, $85 Legal Assistants and Project Assistants Rubio Villegas will coordinate efforts with Greenberg Traurig, LLP -- the Debtor's proposed general bankruptcy counsel -- and clearly delineate duties to prevent any duplication effort. About Satmex SAB Satelites Mexicanos, S.A. de C.V., (Satmex) is a Mexico-based provider of fixed satellite services in the Americas, with coverage to more than 90% of the population to the Americas, including more than 45 nations and territories. Satmex also provides Latin American television programming in the United States. One of only two privately managed FSS providers based in Latin America, Satmex has a fleet comprised of three satellites. Satmex 5 and Satmex 6 generate the adjusted EBITDA for Satmex. A third satellite, Solidaridad 2, is inclined orbit but does not generate any adjusted EBITDA. Construction of Satmex 8 is expected to be completed by July 2012. Satmex also intends to pursue plans for a new satellite, to be named Satmex 7. Satmex first filed for bankruptcy in August 2006 in New York and exited four months later with a plan to repay creditors owed about US$743 million with new debt and equity. Satmex, with affiliates Alterna' TV International Corporation and Alterna' TV Corporation, again filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-11035) on April 6, 2011. The Debtors disclosed US$441.6 million in total assets and US$531.6 million in total debts as of March 23, 2011. In its schedules, Satmex disclosed US$393,427,253 in total assets and US$457,699,978 in total debts on a stand-alone basis. Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, serves as the Debtor's bankruptcy counsel in the present Chapter 11 case. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' financial advisor. Jefferies & Company, Inc., is the financial advisor to supporting second lien noteholders. Ropes & Gray LLP is the U.S. counsel to supporting second lien noteholders. Cervantes Sainz serves as Mexican counsel to supporting 2nd lien noteholders. Dechert LLP is the U.S. counsel to supporting holders of first priority notes. Galicia Abogados, S.C., is the Mexican counsel to supporting holders of first priority notes. Bracewell & Giuliani LLP is the U.S. counsel to Series B. Directors. Kuri Brena Sanchez Ugarte Y Aznar is Mexican counsel to Series B. Directors. Morgan, Lewis & Bockius LLP is the U.S. counsel for SCT for Mexico Government. Casares, Castelazo, Frias, Tenorio Y Zarate, SC, is the Mexican counsel for SCT for Mexico Government. Detente Group is the financial advisor for SCT for Mexico Government. Latham & Watkins LLP is the U.S. counsel to Jefferies Finance. Creel, Garcia-Cuellar, Aiza Y Enriquez is the Mexican counsel for Jefferies. SATELITES MEXICANOS: Has Court's Final Nod to Use Cash Collateral ----------------------------------------------------------------- Satelites Mexicanos S.A. de C.V. and its debtor-affiliates obtained final authorization from the Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware to use cash collateral, pursuant to the budget. As adequate protection for prepetition secured parties, the Debtors have agreed to grant: a) Accrual of Interest: i) The First Priority Notes will be paid interest from and after the Petition Date based upon the applicable non-default interest rate of 12% per annum; and ii) the Second Priority Notes shall accrue interest from and after the Petition Date at the applicable non-default interest rate of 10 1/8%; b) Current Payment of Interest on the First Priority Notes: During the pendency of the Chapter 11 cases, each interest period will be a calendar month, and the Debtors will pay interest on a current basis at the applicable non-default rate of 12% per annum on the applicable interest payment date for each monthly interest period, beginning with the last calendar day of April 2011 (or the next succeeding business day if the last calendar day of he month falls on a Saturday, Sunday or legal holiday). A full-text copy of the cash collateral budget is available for free at http://is.gd/VZwlar About Satmex SAB Satelites Mexicanos, S.A. de C.V., (Satmex) is a Mexico-based provider of fixed satellite services in the Americas, with coverage to more than 90% of the population to the Americas, including more than 45 nations and territories. Satmex also provides Latin American television programming in the United States. One of only two privately managed FSS providers based in Latin America, Satmex has a fleet comprised of three satellites. Satmex 5 and Satmex 6 generate the adjusted EBITDA for Satmex. A third satellite, Solidaridad 2, is inclined orbit but does not generate any adjusted EBITDA. Construction of Satmex 8 is expected to be completed by July 2012. Satmex also intends to pursue plans for a new satellite, to be named Satmex 7. Satmex first filed for bankruptcy in August 2006 in New York and exited four months later with a plan to repay creditors owed about US$743 million with new debt and equity. Satmex, with affiliates Alterna' TV International Corporation and Alterna' TV Corporation, again filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-11035) on April 6, 2011. The Debtors disclosed US$441.6 million in total assets and US$531.6 million in total debts as of March 23, 2011. In its schedules, Satmex disclosed US$393,427,253 in total assets and US$457,699,978 in total debts on a stand-alone basis. Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, serves as the Debtor's bankruptcy counsel in the present Chapter 11 case. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' financial advisor. Rubio Villegas & Asociados, S.C., serves as the Debtors' special Mexican corporate and regulatory counsel. Jefferies & Company, Inc., is the financial advisor to supporting second lien noteholders. Ropes & Gray LLP is the U.S. counsel to supporting second lien noteholders. Cervantes Sainz serves as Mexican counsel to supporting 2nd lien noteholders. Dechert LLP is the U.S. counsel to supporting holders of first priority notes. Galicia Abogados, S.C., is the Mexican counsel to supporting holders of first priority notes. Bracewell & Giuliani LLP is the U.S. counsel to Series B. Directors. Kuri Brena Sanchez Ugarte Y Aznar is Mexican counsel to Series B. Directors. Morgan, Lewis & Bockius LLP is the U.S. counsel for SCT for Mexico Government. Casares, Castelazo, Frias, Tenorio Y Zarate, SC, is the Mexican counsel for SCT for Mexico Government. Detente Group is the financial advisor for SCT for Mexico Government. Latham & Watkins LLP is the U.S. counsel to Jefferies Finance. Creel, Garcia-Cuellar, Aiza Y Enriquez is the Mexican counsel for Jefferies. SAVANNA ENERGY: DBRS Assigns 'B' Issuer Rating ---------------------------------------------- DBRS has assigned an Issuer Rating of B (high) with a Stable trend to Savanna Energy Services Corp. (Savanna or the Company). DBRS has also assigned a provisional rating of B (high) with a Stable trend and a recovery rating of RR4 to Savanna's proposed Senior Unsecured Notes (the Notes). The proposed Notes, estimated at $125 million and supported by certain subsidiary guarantees, are structurally subordinated to Savanna's existing secured bank facility (the Bank Facility), which is to be downsized to $135 million (currently $175 million) following the Notes issuance. Proceeds from the Notes are to be used to pay down the Bank Facility. The assigned ratings reflect the Company's strong financial profile, with adequate liquidity, a modern fleet of drilling rigs, a flexible operating cost structure and a relatively diverse customer base. However, these strengths are offset by the following main challenges: (1) the cyclical nature of the drilling industry; (2) excess rig capacity and low drilling activities in the Western Canada Sedimentary Basin (WCSB), one of Savanna's core operating areas; and (3) the Company's limited geographic diversification and ambitious growth strategy (mostly related to drilling rig conversions supported by 2-3 year term contracts) to achieve critical mass, which could pressure its balance sheet. The successful execution of the rig conversion program could have a positive implication on the ratings. The assigned ratings are based on DBRS's expectation that the Company will maintain its conservative financial profile by funding its growth plans with an appropriate mix of debt and equity. DBRS notes that past acquisitions were either small in scale or funded by a prudent mix of debt and equity and fit well within the business model. This includes the recently announced $35 million acquisition of Performance Services Ltd. (Performance), which is proposed to be 100% equity financed (representing 3% of consolidated total assets). The ratings are supported by the following factors: (1) Savanna maintains a conservative balance sheet, with a total debt-to-capital ratio of 14% in 2010 (15%, including operating leases) and adequate cash flow support at total debt-to-cash flow of 1.6 times, which compare favorably with its peers. Savanna maintained reasonable financial metrics even in 2009, one of the most challenging years ever faced by the drilling industry in North America. The aforesaid was helped by a $127 million equity issuance in June 2009, with proceeds used for debt reduction, alleviating potential credit concerns. (2) Savanna's average fleet age, at six years, is well below the industry average of more than 15 years. In weaker markets, DBRS expects newer, more efficient and more powerful rigs to better withstand downturns. (3) The Company benefits from a flexible workforce: approximately 90% of the staff is paid hourly or daily. As a result, the Company can effectively manage its operating cost base according to industry conditions. However, attracting qualified workers is an industry challenge. (4) Over the years, Savanna has favorably reduced its concentration risk by expanding its customer base. Credit risk associated with counterparties is relatively limited, given that Savanna's key customers generally have strong credit quality and no one customer accounts for more than 10% of total revenue. Savanna's credit ratings are limited by the following considerations: (1) The Company's earnings and cash flow are subject to substantial market cyclicality. Demand for contract drilling services, the key earnings contributor for Savanna (approximately 80% of earnings), is subject to the substantial underlying volatility of the oil and gas industry. In a weak energy price environment, as evidenced in WCSB in late 2008 and in 2009, producers limit drilling activities as cash flow and liquidity weaken, negatively affecting the Company's credit measures. (2) Steadily rising energy prices in the early to mid-2000s led to a significant rise in the Canadian industry drilling fleet, creating excess capacity. This, combined with a significant increase in natural gas supply emanating from shale gas developments, has continued to put severe downward pressure on utilization and day rates for Savanna's shallow-drilling rigs (around 40% of the fleet as of Dec. 31, 2010). (3) Savanna's limited geographic diversification (74/22/2 Canada/United States/Australia by net drilling-rig count as of Dec. 31, 2010) renders its operations more vulnerable to a sudden drop in activities in its core regions, primarily WCSB, compared to its larger peers. In addition, larger size generally facilitates more access to capital markets. Savanna's profitability was negatively affected by the weak industry conditions in Canada in 2009 to a greater extent than its peers with greater geographic diversification. However, the Company is actively pursuing plans to expand in the United States and, to a lesser extent, in Australia. The Company's A$220 million five- year contract with Australia Pacific LNG (APLNG, a 50/50 joint venture of ConocoPhillips and Origin Energy Australia) marks a foray into that market (although drilling activities have been negatively affected by the recent floods). (4) The Company intends to shift further to higher-margin deeper drilling by retrofitting its shallow drilling rigs (hybrid rigs) and to substantially grow its fleet and rental business, with the goal to generate more than 50% of total revenue outside Canada (about 30% in 2010) and be more oil focused. These ambitious growth plans, if executed aggressively, could weaken Savanna's financial profile materially. Substantial goodwill/intangible asset impairments ($151 million and $310 million in 2007 and 2008, respectively) associated with the acquisition of Western Lakota Energy Services Inc. in 2006, while non-cash, depressed the Company's equity base. It is noteworthy that this transaction has transformed Savanna from a shallow gas to a deeper driller, which better serves the changing drilling market of the last two to three years. The ratings assume that the Company will manage its growth, while maintaining its conservative financial profile. Savanna has recently entered into a definitive agreement to purchase Performance, a private WCSB well-servicing company with 16 service rigs. The transaction, scheduled to close in June 2011, is to be fully funded by equity. Performance has no debt and will have approximately $2 million of working capital at closing. The acquisition is expected to be modestly accretive to cash flow. The Company's 2011 capex, projected at $113 million, with potential upsizing to accelerate the rig conversion and expansion program, should be largely covered by internally generated cash flow. SBARRO INC: In Talks With Mystery Buyer on Likely Buyout -------------------------------------------------------- Kristen McBeth at BankruptcyHome.com reports that Sbarro Inc. said it is in negotiations to be purchased for an offer larger than originally listed in the bankruptcy filing. According to the report, the Company is in talks with an unnamed organization that Sbarro stresses is not a financial institution. Negotiation details are currently private, but the end of bankruptcy may be in sight after the pizza maker ended its equity commitment with Ares Corporate Opportunities Fund II LLP and MidOcean Partners. About Sbarro Inc. The Sbarro family started its business after moving to Brooklyn, New York, from Naples, Italy, in 1956. Today Sbarro is a leading, global Italian quick service restaurant concept with approximately 5,170 employees, 1,045 restaurants throughout 42 countries, and annual revenues in excess of $300 million. Sbarro Inc. sought bankruptcy protection under Chapter 11 (Bankr. S.D.N.Y. Lead Case No. 11-11527) to eliminate about $200 million in debt. The Debtor disclosed $51,537,899 in assets and $460,975,646 in liabilities as of the Chapter 11 filing. Sbarro said it has reached an agreement with all of its second- lien secured lenders and approximately 70% of its senior noteholders on the terms of a reorganization plan that will eliminate more than half of the Company's total indebtedness. Edward Sassower, Esq., and Nicole Greenblatt, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' general bankruptcy counsel. Rothschild, Inc., is the Debtors' investment banker and financial advisor. PriceWaterhouseCoopers LLP is the Debtors' bankruptcy consultants. Marotta Gund Budd & Dzera, LLC, is the Debtors' special financial advisor. Curtis, Mallet-Prevost, Colt & Mosle LLP serves as the Debtors' conflicts counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims agent. Sard Verbinnen & Co is the Debtors' communications advisor. SCHUTT SPORTS: Has OK to Pay Trade Claims From $400T Escrow ----------------------------------------------------------- Schutt Sports, Inc., obtained Bankruptcy Court authority earlier this month to pay trade claims on a pro rata basis from the Trade Creditor Escrow. Pursuant to a global resolution of certain litigation and claims, $400,000 from the proceeds of the sale of the Debtors' assets has been earmarked to pay trade creditors. A list of the trade claims for payment is available at no charge at http://bankrupt.com/misc/SSITradeClaimsList.pdf On May 5, 2011, the Court granted the Debtors' request for extension of their exclusive periods to file and solicit acceptances of the Plan through July 5 and Sept. 1, respectively. On May 10, 2011, the Debtors obtained confirmation of their liquidating Chapter 11 plan. The Debtor and the official committee of unsecured creditors appointed in the case are proponents of the Plan. Creditors overwhelmingly voted to accept the plan. Unsecured creditors are to receive no more than 3% on their $15.9 million in claims. The principal creditors were previously paid as the result of a settlement with competitor Riddell Inc. According to the Disclosure Statement, as amended, the Plan provides for the following recovery for holders of claims and interests: Class of Creditors Estimated Percentage Recovery ------------------ ----------------------------- Class 2 - Secured Creditors 100% Class 3 - General Unsecured Claims SH - 1% to 3% SSI - 1% to 3% Circle - 1% to 3% Melas, Mt. View, RDH and Triangle - Each less than 1% Class 4 - Critical Trade vendor Each less than 1% Claims Class 5 - Unsecured Convenience 18% Claims Class 6 - Penalty Claims Less than 1% Class 7 - Interest Less than 1% Class 8 - Intercompany Interest 0% The Debtors re-filed a copy of their Modified First Amended Joint Chapter 11 Plan of Liquidation on May 20. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/SchuttSports_DS329.pdf About Schutt Sports Headquartered in Litchfield, Illinois, Schutt Sports, Inc. -- fka Schutt Manufacturing Company, Schutt Sports Manufacturing Co., Schutt Sports Distribution Company, and Schutt Athletic Sales Company -- and its affiliates manufactured team sporting equipment, primarily for football, baseball and softball. Schutt Sports filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 10-12795) on Sept. 6, 2010. The Company was forced into Chapter 11 by a $29 million patent-infringement judgment in favor of competitor Riddell Inc. Victoria W. Counihan, Esq., and Sandra G. M. Selzer, Esq., at Greenberg Traurig, LLP, in Wilmington Del.; and Keith J. Shapiro, Esq., and Nancy A. Peterman, Esq., at Greenberg Traurig, LLP, in Chicago, Ill., represent the Debtors as counsel. Ernst & Young is the Debtor's financial advisor. Oppenheimer & Co., Inc., is the Debtor's investment banker. Logan & Company is the claims and notice agent. The Official Committee of Unsecured Creditors tapped Lowenstein Sandler PC as its counsel. Womble Carlyle Sandridge & Rice, PLLC also represents the Committee. The Debtor estimated assets and debts at $50 million to $100 million as of the Petition Date. Platinum Equity in December 2010 completed the acquisition of substantially all the assets of Schutt Sports through a transaction conducted under Section 363 of the U.S. Bankruptcy Code, and Schutt Sports, Inc.'s Chapter 11 estate changed its name to SSI Liquidating, Inc. SCOVILL FASTENERS: Committee Taps Greenberg Traurig as Counsel -------------------------------------------------------------- The Official Committee of Unsecured Creditors of Scovill Fasteners Inc. and its debtor-affiliates asks the U.S. Bankruptcy Court for the Northern District of Georgia for permission to employ Greenberg Traurig, LLP, as its counsel to give legal advice with respect to the Committee's duties and powers in the Debtors' cases. The firm will be paid based on the hourly rates of its professionals: Partners $425-$850 Associates $250-$450 Paralegal $150-$250 The Committee assure the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Scovill Fasteners Scovill Fasteners Inc. -- dba Scovill Apparel Fasteners Inc. and Scovill Manufacturing Co. -- produces snap fasteners and tack buttons. It manufactures the majority of its products at its 300,000 square foot factory located in Clarkesville, Georgia. Clarkesville is also its headquarters location. Scovill Fasteners along with affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ga. Lead Case No. 11-21650) on April 19, 2011. Heather N. Byrd, Esq., and John C. Weitnauer, Esq., at Alston & Bird LLP, serve as the Debtors' bankruptcy counsel. BMC Group Inc. is the claims and notice agent. Scovill estimated its assets at $10 million to $50 million and debts at $100 million to $500 million. SCOVILL FASTENERS: Taps Carl Marks as Financial Advisor ------------------------------------------------------- Scovill Fasteners Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Northern District of Georgia for permission to employ Carl Marks Advisory Group LLC as their financial advisor to provide services including merger and acquisition services. The Debtors proposes to pay $15,000 per month to the firm for services rendered. The Debtors assure the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Scovill Fasteners Scovill Fasteners Inc. -- dba Scovill Apparel Fasteners Inc. and Scovill Manufacturing Co. -- produces snap fasteners and tack buttons. It manufactures the majority of its products at its 300,000 square foot factory located in Clarkesville, Georgia. Clarkesville is also its headquarters location. Scovill Fasteners along with affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ga. Lead Case No. 11-21650) on April 19, 2011. Heather N. Byrd, Esq., and John C. Weitnauer, Esq., at Alston & Bird LLP, serve as the Debtors' bankruptcy counsel. BMC Group Inc. is the claims and notice agent. Scovill estimated its assets at $10 million to $50 million and debts at $100 million to $500 million. SCOVILL FASTENERS: Has Until May 31 to File Statements & Schedules ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Georgia gave Scovill Fasteners Inc. and its debtor-affiliates to file their statements of financial affairs, and schedules of assets and liabilities until May 31, 2011. The Debtors said requested extension will not prejudice or adversely affect the rights of their creditors or other interested parties. The extension will aid the Debtors' efforts to ensure the accuracy and completeness of the Schedules and SOFA which will, in turn, enable a timely and efficient administration of these cases. About Scovill Fasteners Scovill Fasteners Inc. -- dba Scovill Apparel Fasteners Inc. and Scovill Manufacturing Co. -- produces snap fasteners and tack buttons. It manufactures the majority of its products at its 300,000 square foot factory located in Clarkesville, Georgia. Clarkesville is also its headquarters location. Scovill Fasteners along with affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ga. Lead Case No. 11-21650) on April 19, 2011. Heather N. Byrd, Esq., and John C. Weitnauer, Esq., at Alston & Bird LLP, serve as the Debtors' bankruptcy counsel. BMC Group Inc. is the claims and notice agent. Scovill estimated its assets at $10 million to $50 million and debts at $100 million to $500 million. SCOVILL FASTENERS: Unsecured Creditors Want 4% Carveout From Sale ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the creditors' committee for Scovill Fasteners Inc. opposes final financing approval absent changes. The hearing on the loan is set for May 24. There will be an auction on June 8 to test whether the $17 million offer from Global Equity Capital LLC is the best bid for the business. The committee says the loan doesn't put cash aside to wind down the case once the sale is completed. The committee also objects to how lawsuits not making up the lenders' collateral will be sold and nothing is given in return for unsecured creditors. The committee wants 4% of the sale price to be carved out for unsecured creditors. If the price exceeds $17 million, the committee wants 25% of the excess. The committee argues that the $65,000 budget for the committee in the loan is inadequate. It wants $250,000 plus $60,000 to investigate the validity of secured claims. About Scovill Fasteners Scovill Fasteners Inc. -- dba Scovill Apparel Fasteners Inc. and Scovill Manufacturing Co. -- produces snap fasteners and tack buttons. It manufactures the majority of its products at its 300,000 square foot factory located in Clarkesville, Georgia. Clarkesville is also its headquarters location. Scovill Fasteners along with affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ga. Lead Case No. 11-21650) on April 19, 2011. Heather N. Byrd, Esq., and John C. Weitnauer, Esq., at Alston & Bird LLP, serve as the Debtors' bankruptcy counsel. BMC Group Inc. is the claims and notice agent. Scovill estimated its assets at $10 million to $50 million and debts at $100 million to $500 million. The bankruptcy judge has given interim approval for $20.8 million in secured financing from General Electric Capital Corp., as agent for lenders. SECUREALERT INC: Posts $2.5 Million Net Loss in March 31 Quarter ---------------------------------------------------------------- SecureAlert, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $2.5 million on $3.9 million of revenues for the three months ended March 31, 2011, compared with a net loss of $3.5 million on $3.0 million of revenues for the three months ended March 31, 2010. The Company's balance sheet at March 31, 2011 showed $12.8 million in total assets, $11.1 million in total liabilities, and stockholders' equity of $1.7 million. As reported in the Troubled Company Reporter on Jan. 5, 2011, Hansen, Barnett & Maxwell, P.C., in Salt Lake City, expressed substantial doubt about SecureAlert's ability to continue as a going concern, following the Company's results for the fiscal year ended Sept. 30, 2010. The independent auditors noted that the Company has incurred losses, negative cash flows from operating activities and has an accumulated deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/Qw1XVU About SecureAlert Inc. Sandy, Utah-based SecureAlert, Inc. (OTC BB: SCRA) -- http://www.securealert.com/-- is an international provider of electronic monitoring systems, case management and services widely utilized by more than 650 law enforcement agencies worldwide. SEDONA DEVELOPMENT: Disclosure Statement Hearing Tomorrow --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona will continue the hearing on May 25, 2011, at 1:30 p.m., to consider approval of the amended disclosure statement explaining a Chapter 11 plan of reorganization filed by Sedona Development Partners LLC and The Club at Seven Canyons LLC. Don H. Davis, Jr., Lute Riley, and Hans Epprecht objected to the Debtors' amended disclosure statement because it fails to provide adequate information. The Debtors' Plan purports to impact over $100 million dollars in creditor claims, yet maintain the very management that steered this ship into the bankruptcy iceberg. In light of the extremely large amount of debt and number of claimants, and the relatively small asserted value of the Debtors' remaining assets, substantial additional disclosures are warranted. Moreover, where the Debtors purport to substantively consolidate their assets and liabilities through the Plan, simple explanations that "management was not at fault for the bankruptcy filings" and that "funds were comingled" are woefully insufficient to provide creditors with adequate information to cast the votes on the Plan. Finally, no Disclosure Statement can be approved until the accounting of the use of the over $200 million that flowed through the Debtors since the beginning of the Seven Canyon project and the related party payments, is created and reviewed. According to the Troubled Company Reporter on April 27, 2011, the Debtor submitted to the Court a Plan of Reorganization, amended as of April 6, 2011. Under the amended Plan, the Reorganized Debtor will continue to market and sell Villa Intervals on Parcel A through the designated broker, CMC Realty, Inc., on terms and conditions (including the payment of commissions) consistent with reasonable industry standards. The Reorganized Debtor will also continue exploring and implementing opportunities to develop Parcels B and C through existing management. Under the amended Plan, the Debtor proposes to treat claims and interests as follows: -- Allowed secured claims will be paid in full over a period of seven to 10 years. -- The Debtors intend to assume the Membership Plan and each Membership Agreement and do not intend to alter the Members' rights under the Membership Plan or Membership Agreement. -- Allowed General Unsecured Claims will share, pro-rata, in a distribution of the sum of $2,000,000 in cash paid by the Reorganized Debtor from the New Value contribution, on the 90th day following the Effective Date of the Plan. The New Interest Holders will arrange for the infusion of the Unsecured Distribution Amount into an account created by the Reorganized Debtor for the receipt of the funds. -- Allowed Unsecured Claims of Seven Canyons Lot Holdings will share, pro-rata, in a distribution of the sum of $100,000 in cash paid by the Reorganized Debtor from the New Value contribution, on the 90th day following the Effective Date of the Plan. -- Allowed Unsecured Claims of Cavan Related Entities Against Both SDP and the Club. In the event that the existing Interest Holder becomes the New Interest Holder which owns the equity interest in the Reorganized Debtor, the holders of the insider Allowed Unsecured Claims in this Class will waive any and all Allowed Unsecured Claims against the Debtors. However, if the current Interest Holder is not the New Interest Holder of the equity interests in the Reorganized Debtor, then the Allowed Unsecured Claims of insiders will not be waived and the Allowed Unsecured Claims in this Class will share, pro-rata, in a distribution of the sum of $100,000 in cash paid by the Reorganized Debtor from the New Value contribution, on the 90th day following the Effective Date of the Plan. The New Interest Holders will arrange for the infusion of the Insider Unsecured Distribution Amount into an account created by the Reorganized Debtor for the receipt of the funds. Upon their receipt of their respective pro rata portions of the Insider Unsecured Distribution Amount, all Allowed Unsecured Claims in this Class shall be deemed paid and discharged in full. A full-text copy of the Amended Plan is available for free at: http://bankrupt.com/misc/SEDONADEVELOPMENT_AmendedPlan.pdf The Debtors are represented by: John J. Hebert, Esq. Philip R. Rudd, esq. Wesley D. Ray, Esq. POLSINELLI SHUGHART PC CityScape Plaza One E. Washington, Suite 1200 Phoenix, AZ 85004 Tel: (602) 650-2000 Fax: (602) 264-7033 E-mail: PhoenixBankruptcyECF@polsinelli.com jhebert@polsinelli.com prudd@polsinelli.com wray@polsinelli.com About Sedona Development Partners Sedona Development Partners owns an 18-hole golf course and related properties, including luxury villas, a practice park, range house, tennis courts and related facilities in Sedona, Arizona, known generally as Seven Canyons. The Club at Seven Canyons, LLC, operates the golf course and related facilities for SDP. SDP is the manager and sole member of the Club. Sedona Development Partners filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 10-16711) on May 27, 2010. The Club At Seven Canyons filed a separate Chapter 11 petition (Bankr. D. Ariz. Case No. 10-16714). Polsinelli Shughart PC assists the Debtors in their restructuring efforts. Lender Specialty Trust is represented by Joseph E. Cotterman, Esq., and Nathan W. Blackburn, Esq., at Gallagher & Kennedy, P.A. Sedona disclosed $29,171,168 in assets and $121,679,994 in liabilities. S.H. LEGGITT: Court Approves Finance Deal with Premium Assignment ----------------------------------------------------------------- The Hon. H. Christopher Mott of the U.S. Bankruptcy Court for the Western District of Texas authorized S. H. Leggitt Company to enter into Premium Finance Agreement with Premium Assignment Corporation, a Florida Corporation. The Debtor related that it will use the money to continue an effective reorganization that will not require obtaining or utilizing any additional funds. The Debtor added that it will use the fund to maintain its liability insurance coverage. The terms is the agreement includes: Total price of premiums: $131,137 Cash down payment: - $32,840 Principal balance owed on premiums: = $98,296 Total amount financed: $98,296 Finance charge: + $2,041 Total of payments: = $100,338 Annual percentage rate: 5.47% As adequate protection for any diminution in value of the lenders' collateral, the Debtor will grant the PAC, or its successor or assigns, a first priority lien on and security interest in unearned premiums. The Debtor will also pay PAC or its successor or assigns all sums due under the agreement. The Debtor also said that if additional premiums become due to insurance companies under the policies financed under the agreement, the Debtor and PAC or its successor or assigns are authorized to modify the Agreement as necessary to pay the additional premiums without the necessity of further hearing or order of this Court. Debtor manufactures brass fittings and products at its plant located at 1000 Civic Center Loop, San Marcos, Hays County, Texas. About SH Leggitt San Marcos, Texas-based S.H. Leggitt Company, aka Marshall Products -- dba The Leggitt Group; Marshall Brass Company; and Marshall Gas Controls, Inc. -- sought Chapter 11 bankruptcy protection (Bankr. W.D. Texas Case No. 10-10279) on Feb. 2, 2010. In its schedules, the Debtor disclosed $15,869,020 in total assets and $11,404,353 in total debts. Joseph D. Martinec, Esq., and Rebecca S. McElroy, Esq., Ed Winn, Esq., and Lee Vickers, Esq., at Martinec, Winn, Vickers & McElroy, P.C., represent the company. S.H. LEGGITT: Plan of Reorganization Wins Court Approval -------------------------------------------------------- The Hon. H. Christopher Mott of the U.S. Bankruptcy Court for the Western District of Texas confirmed S.H. Leggitt Company's Plan of Reorganization filed on Sept. 20, 2010, and modified as of Jan. 27, 2011. As reported in the Troubled Company Reporter on April 29, the plan proposes to insulate the reorganized company from all future product liability claims arising out of the use of products manufactured by the debtor and used in the manufacture of consumer LP-Gasgrills, cookers and other outdoor LP-Gas cooking appliances. The Debtor supplied LP-Gas regulators to the majority of the companies who made such appliances in North America between 1990 and 2005. The Debtor has also supplied gas regulators to the majority of companies that manufacture recreational vehicles in North America. To obtain copies of the Debtor's plan and disclosure statement, contact Birdie White at white@mvwmlaw.com by e-mail. About SH Leggitt San Marcos, Texas-based S.H. Leggitt Company, aka Marshall Products -- dba The Leggitt Group; Marshall Brass Company; and Marshall Gas Controls, Inc. -- sought Chapter 11 bankruptcy protection (Bankr. W.D. Texas Case No. 10-10279) on Feb. 2, 2010. In its schedules, the Debtor disclosed $15,869,020 in total assets and $11,404,353 in total debts. Joseph D. Martinec, Esq., and Rebecca S. McElroy, Esq., Ed Winn, Esq., and Lee Vickers, Esq., at Martinec, Winn, Vickers & McElroy, P.C., represent the company. SHENGDATECH, INC.: Appeals Delisting Determination by NASDAQ ------------------------------------------------------------ ShengdaTech, Inc. confirmed that it is continuing to conduct business operations while the Company is appealing the delisting determination issued by the Listing Qualifications Department of The NASDAQ Stock Market LLC. The appeal has temporarily stayed the delisting action pending a hearing on the matter. The Company recently submitted a new compliance plan to Nasdaq in preparation for a hearing scheduled for May 26, 2011 whereby the Company will present its appeal of the Nasdaq's delisting determination. There can be no assurance that the Company's appeal for continued listing will be granted, or even if it is granted that the Company will be able to execute upon such request in a timely manner or to the satisfaction of Nasdaq. In the event the Nasdaq affirms the delisting determination, the Company's securities will be subject to imminent delisting from Nasdaq and will be quoted for trading in over-the-counter securities markets. On April 16, 2011, the Company received a letter from Nasdaq stating that the Company's failure to file its Form 10-Q for the period ended March 31, 2011 with the Securities Exchange Commission and Nasdaq serves as an additional basis for delisting the Company's securities from The Nasdaq Stock Market under Nasdaq Listing Rule 5810(b). The Company intends to address this matter pursuant to Nasdaq Listing Rule 5810(d) at the appeals hearing. Additionally, as previously reported, the special committee, consisting of three independent members of the Board of Directors, is executing upon its mandate to conduct an internal investigation into serious discrepancies and unexplained issues relating to the Company and its subsidiaries' financial records identified by KPMG, the Company's former independent registered public accounting firm, in the course of their audit of the consolidated financial statements for the fiscal year ended Dec. 31, 2010. The Company has started to implement the cash control and validation plan established by the special committee, which requires the transfer of control over the Company's cash assets by consolidating cash into accounts over which the audit committee would have authority. The Company is in the process of evaluating potential independent registered public accounting firms to replace KPMG and intends to become compliant with its reporting obligations as soon as practicable. About ShengdaTech ShengdaTech is engaged in the business of manufacturing, marketing, and selling nano-precipitated calcium carbonate products. The Company converts limestone into NPCC using its proprietary and patent-protected technology. NPCC products are increasingly used in tires, paper, paints, building materials, and other chemical products. In addition to its broad customer base in China, the Company currently exports to Singapore, Thailand, South Korea, Malaysia, India, Latvia and Italy. SIGG SWITZERLAND: Class Suits, Declining Sales Cue Bankruptcy ------------------------------------------------------------- Katy Stech, writing for Dow Jones' Daily Bankruptcy Review, reports that Sigg Switzerland USA Inc., which is behind the bold and ubiquitous Sigg aluminum water bottles sold in the U.S., has filed for Chapter 11 bankruptcy protection, weary from fending off customer concerns over the controversial BPA chemical found in some earlier models of its popular canteens. Sigg Switzerland USA has exclusive rights to distribute the Swiss- made bottles to retailers throughout the U.S. DBR reports the Company will continue operating while it sells its U.S.-based operations to a Canadian affiliate that has similar distribution rights. "There will be no disruption to the way we currently do business," Sigg Switzerland USA President Rob Dewar told Bankruptcy Beat on Monday. The Company has faced class actions, alleging misrepresentations, breach of warranty and violation of consumer-protection laws. Meanwhile, sales of its widely recognized water bottles fell. "The [company] has lost millions of dollars in each of the past two years as a result of decreased sales and an unsustainable cost structure," the company said in court documents filed Friday with the U.S. Bankruptcy Court in Bridgeport, Connecticut, DBR notes. SIRIUS XM: To Settle "Carl Blessing" Lawsuit Pending in N.Y. ------------------------------------------------------------ Sirius XM Radio Inc., on May 12, 2011, reached an agreement to settle the pending case entitled, Carl Blessing et al. v. Sirius XM Radio Inc. Carl Blessing, a subscriber, filed a lawsuit against the Company in the United States District Court for the Southern District of New York. Mr. Blessing and several other plaintiffs purport to represent all subscribers who were subject to: an increase in the price for additional-radio subscriptions from $6.99 to $8.99; the imposition of the US Music Royalty Fee; and the elimination of the Company's free streaming internet service. The suit claims that the pricing changes show that the Company's merger with XM lessened competition or led to a monopoly in violation of the Clayton Act and that the merger led to monopolization in violation of the Sherman Act. Earlier the Court dismissed the plaintiffs' claims for breach of contract and granted the Company's motion for summary judgment as to various state law claims. As part of the settlement, the Company has agreed that commencing on July 28, 2011, the date on which the Company's voluntary commitment not to raise rates on its basic satellite programming package is scheduled to lapse, through Dec. 31, 2011, the Company will not: raise the price of the Company's basic satellite radio service, the Company's other programming packages or the Company's internet streaming services; increase the Company's US Music Royalty Fee; or decrease the Company's multi-radio discount. Existing subscribers will be allowed to renew their current subscription plans at the Company's current rates prior to Dec. 31, 2011. Former subscribers who terminated their subscriptions after July 29, 2009, will be entitled to receive, at their election, either: one month of the Company's basic satellite radio service or one month of the Company's Internet streaming, at no charge. The Company has also agreed to pay the costs of providing notice to the plaintiff class and not to oppose an application by counsel for the plaintiffs for reimbursement of up to $13 million of their fees and expenses. The settlement does not require the Company to make any other cash payments to the plaintiff class or counsel to the plaintiffs. In connection with the settlement, the Company did not admit any wrongdoing, any violation of any statute or law, or the truth of any claims or allegations of the plaintiffs. Despite the Company's belief that the claims asserted by the plaintiffs were untrue, the Company entered into this settlement because it believes it was in the best interest of its stockholders to avoid further legal expense and inconvenience and eliminate the distraction of this protracted litigation. The settlement is contingent upon approval by the United States District Court for the Southern District of New York. 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. 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. * * * 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. SIZZLING PLATTER: S&P Assigns 'B-' Corporate Credit Rating ---------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B-' corporate credit rating to Salt Lake City-based Sizzling Platter LLC. The outlook is stable. "At the same time, we assigned a 'B-' rating, with a recovery rating of '4', to the company's $135 million senior secured notes due 2016. Our '4' recovery rating indicates our expectation of average (30%-50%) recovery in the event of a payment default. According to the company, it intends to use the proceeds from the notes to acquire additional restaurants, refinance existing indebtedness, repurchase all of outstanding preferred equity, and for general corporate purposes," S&P noted. "The ratings on Sizzling Platter reflect our expectation that although operating performance will likely remain relatively stable," said Standard & Poor's credit analyst Helena Song, "the company's credit metrics will weaken meaningfully following the proposed new notes offering with significantly higher debt." "Moreover, we view the company as having less than adequate liquidity. The ratings also reflect Sizzling Platter's vulnerable business risk profile, its small EBITDA base, and a highly leveraged capital structure." SOUTH EDGE: Chapter 11 Trustee Sues JPMorgan, Focus --------------------------------------------------- Eric Morath, writing for Dow Jones' Daily Bankruptcy Review, reports that Cynthia Nelson, the Chapter 11 trustee for South Edge LLC, is suing J.P. Morgan Chase & Co. and Focus Group South LLC, the Inspirada project's former management, to recover more than $30 million ushered out of the Company prior to it being pushed into bankruptcy. The lawsuit was filed Friday with the U.S. Bankruptcy Court in Las Vegas. DBR relates the Chapter 11 trustee alleges that: -- Focus took the South Edge name off a JPMorgan bank account holding some $30 million and put that account in a Focus entity's name. Then, Focus went on to spend $4.5 million from that account on purposes other than paying for improvements at the Inspirada development; and -- JPMorgan, despite serving as the agent for lenders who may hold liens on the disputed funds, has failed to respond to the trustee's request for help in recovering the money. According to DBR, an attorney for Focus said the lawsuit was "without merit" and declined further comment. A JPMorgan representative did not immediately respond to request for comment. About South Edge Las Vegas, Nevada-based South Edge LLC owns the Inspirada project, an uncompleted 2,000-acre residential development in Henderson, Nevada, about 16 miles (26 kilometers) southeast of Las Vegas. The eight owners of the project include an affiliate of KB Home, a 49% owner. Other owners are Coleman Toll LP with 10.5%, Pardee Homes Nevada Inc. with 4.9%, Meritage Homes with 3.5%, and Beazer Homes USA Inc. with 2.6%. JPMorgan Chase Bank, N.A., Credit Agricole Corporate and Investment Bank, and Wells Fargo Bank, N.A., filed an involuntary chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 10-32968) on Dec. 9, 2010, against South Edge, LLC. The petitioning creditors are part of a lender group that provided a $595 million credit. New York-based JPMorgan serves as lender and agent for the group. South Edge filed motions to dismiss the involuntary petition. The Court conducted a contested trial on Jan. 24 and 25, 2011, and Feb. 2 and 3, 2011. On Feb. 3, 2011, the Court entered an order for relief under Chapter 11 of the Bankruptcy Code against the Debtor and issued an order directing the appointment of a chapter 11 trustee. The United States Trustee appointed Cynthia Nelson to serve as Chapter 11 trustee on Feb. 20, 2011. The Court approved the appointment three days later. South Edge is represented by lawyers at Klee, Tuchin, Bogdanoff and Stern LLP, and The Schwartz Law Firm, Inc., as legal counsel. Petitioning creditors JPMorgan Chase Bank, N.A., and Wells Fargo Bank, N.A., are represented by lawyers at Morrison and Foerster LLP; and Lewis and Roca LLP. Credit Agricole is represented by lawyers at Haynes and Boone LLP, and Jolley Urga Wirth Woodbury & Standish. The Chapter 11 Trustee is represented by Milbank, Tweed, Hadley & McCloy LLP and Schwartzer & McPherson Law Firm as counsel. Jones Vargas serves as the trustee's special counsel and FTI Consulting, Inc., serves as financial advisors. SPANISH BROADCASTING: Reports $310,000 First Quarter Net Income --------------------------------------------------------------- Spanish Broadcasting System, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income of $310,000 on $30.77 million of net revenue for the three months ended March 31, 2011, compared with a net loss of $828,000 on $30.84 million of net revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $476.63 million in total assets, $434.87 million in total liabilities, $92.35 million in cumulative exchangeable redeemable preferred stock, and a $50.58 million total stockholders' deficit. Raul Alarcon, Jr., Chairman and CEO, commented, "We saw some improvement in the business environment across select markets during the first quarter. We have continued to focus on supporting our strong brands and market leadership through strategic investments in our content and distribution, while managing our costs. Looking ahead, our target audience continues to expand rapidly and our multi-media portfolio remains well positioned to attract advertisers in the nation's largest Hispanic markets." A full-text copy of the Form 10-Q is available for free at: http://is.gd/p3d5s9 About Spanish Broadcasting Headquartered in Coconut Grove, Florida, Spanish Broadcasting System, Inc. -- http://www.spanishbroadcasting.com/-- owns and operates 21 radio stations targeting the Hispanic audience. The Company also owns and operates Mega TV, a television operation with over-the-air, cable and satellite distribution and affiliates throughout the U.S. and Puerto Rico. Its revenue for the twelve months ended Sept. 30, 2010, was approximately $140 million. In November 2010, Moody's Investors Service upgraded the corporate family and probability of default ratings for Spanish Broadcasting System, Inc., to 'Caa1' from 'Caa3' based on improved free cash flow prospects due to better than anticipated cost cutting and the expiration of an unprofitable interest rate swap agreement. Moody's said Spanish Broadcasting's 'Caa1' corporate family rating incorporates its weak capital structure, operational pressure in the still cyclically weak economic climate, generally narrow growth prospects (though Spanish language is the strongest growth prospect) given the maturity and competitive pressures in the radio industry, and the June 2012 maturity of its term loan magnify this challenge. In July 2010, Standard & Poor's Ratings Services raised its corporate credit rating on Miami, Fla.-based Spanish Broadcasting System Inc. to 'B-' from 'CCC+', based on continued improvement in the company's liquidity position. The rating outlook is stable. "The rating action reflects S&P's expectation that, despite very high leverage, SBS will have adequate liquidity over the intermediate term to meet debt maturities, potential swap settlements, and operating needs until its term loan matures on June 11, 2012," said Standard & Poor's credit analyst Michael Altberg. The Company reported net income of $15.04 million on $136.12 million of net revenue for the year ended Dec. 31, 2010, compared with a net loss of $13.78 million on $139.39 million of net revenue during the prior year. SPANISH BROADCASTING: Caspian Owns 5.59% of Class A Common Stock ---------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Caspian Capital LP and its affiliates disclosed that they beneficially own 2,329,320 shares of Class A common stock of Spanish Broadcasting System,Inc., representing 5.59% of the shares outstanding. A full-text copy of the filing is available for free at http://is.gd/dOvz5C About Spanish Broadcasting Headquartered in Coconut Grove, Florida, Spanish Broadcasting System, Inc. -- http://www.spanishbroadcasting.com/-- owns and operates 21 radio stations targeting the Hispanic audience. The Company also owns and operates Mega TV, a television operation with over-the-air, cable and satellite distribution and affiliates throughout the U.S. and Puerto Rico. Its revenue for the twelve months ended Sept. 30, 2010, was approximately $140 million. In November 2010, Moody's Investors Service upgraded the corporate family and probability of default ratings for Spanish Broadcasting System, Inc., to 'Caa1' from 'Caa3' based on improved free cash flow prospects due to better than anticipated cost cutting and the expiration of an unprofitable interest rate swap agreement. Moody's said Spanish Broadcasting's 'Caa1' corporate family rating incorporates its weak capital structure, operational pressure in the still cyclically weak economic climate, generally narrow growth prospects (though Spanish language is the strongest growth prospect) given the maturity and competitive pressures in the radio industry, and the June 2012 maturity of its term loan magnify this challenge. In July 2010, Standard & Poor's Ratings Services raised its corporate credit rating on Miami, Fla.-based Spanish Broadcasting System Inc. to 'B-' from 'CCC+', based on continued improvement in the company's liquidity position. The rating outlook is stable. "The rating action reflects S&P's expectation that, despite very high leverage, SBS will have adequate liquidity over the intermediate term to meet debt maturities, potential swap settlements, and operating needs until its term loan matures on June 11, 2012," said Standard & Poor's credit analyst Michael Altberg. The Company reported net income of $15.04 million on $136.12 million of net revenue for the year ended Dec. 31, 2010, compared with a net loss of $13.78 million on $139.39 million of net revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $476.63 million in total assets, $434.87 million in total liabilities, $92.35 million in cumulative exchangeable redeemable preferred stock and a $50.58 million total stockholders' deficit. SPECTRUM BRANDS: Moody's Upgrades CFR to 'B1'; Outlook Stable ------------------------------------------------------------- Moody's Investors Service upgraded most of Spectrum Brands, Inc.'s (Spectrum or Spectrum Brands) ratings one notch following continued operating performance improvements and debt reduction efforts and our expectation that both will continue. The corporate family rating and probability of default rating were both upgraded to B1 from B2, the ratings on the secured term loan and secured notes were upgraded to B1 from B2 and the subordinated notes rating was upgraded to B3 from Caa1. The SGL-2 speculative grade liquidity rating was affirmed. The rating outlook is stable. "The upgrade reflects our view that Spectrum's value strategy, recent amendment of its credit facilities and its focus on reducing debt should result in improved credit metrics and a credit profile that is more consistent with a B1 rating" said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. RATINGS RATIONALE The B1 corporate family rating reflects Spectrum's rather high, albeit decreasing, financial leverage at over 4.5x (around 4x proforma) and its modest size with revenues around $3 billion proforma. The highly competitive industry that Spectrum operates in competing against bigger and better capitalized companies also constrains the rating. Spectrum's history of being financially aggressive, culminating with the February 2009 bankruptcy further constricts the rating to a degree. Spectrum's ratings benefit from its good product diversification with products ranging from personal care items, to pet food and small appliances. The B1 rating also reflects the general stability in performance during the recession and our expectation that credit metrics will continue improving in the near to mid-term. Spectrum's good liquidity profile is also incorporated in the rating as is its increasing international penetration. The stable outlook incorporates our expectation of modest revenue and earnings growth and a continued focus on reducing debt. Moody's expectation that Spectrum will maintain a strong liquidity profile and will not engage in any material shareholder friendly moves in the near to mid-term is also reflected in the stable outlook. There is no near term pressure for the rating to be upgraded given this upgrade and its ownership structure. Over the longer term, however, the rating could be upgraded if the company were to meaningfully improve profitability in the face of high raw material prices and continues to pay down debt. Key credit metrics necessary for an upgrade would be debt/EBITDA below 3x (currently over 4.5x and 4x proforma) and EBITA margins in the mid to upper teens on a sustained basis. Further clarity from Harbinger about its long term plans would also be necessary for an upgrade to be considered. There is also no near term pressure for the rating to be downgraded. The two biggest risks that could result in a downgrade over the longer term are aggressive capital structure moves by Harbinger and excessively high raw material costs that cannot be passed through to retailers. Key credit metrics driving a downgrade are debt/EBITDA sustainined over 5.5x and mid single digit Moody's adjusted operating margins (currently in the low teens). These ratings were upgraded: -- Corporate family rating to B1 from B2: -- Probability of default rating to B1 from B2: -- $750 million senior secured notes to B1 (LGD3, 48%) from B2 (LGD3, 49%); -- $750 million senior secured term loan ($680 million outstanding) to B1 (LGD3, 48%) from B2 (LGD3, 49%); -- $231 senior subordinated notes due 2013 to B3 (LGD 6, 90%) from Caa1 (LGD 6, 92%); This rating was affirmed: -- Speculative grade liquidity rating at SGL 2 The principal methodology used in rating Spectrum Brands was Moody's Global Packaged Goods Industry methodology published in July 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Madison, Wisconsin, Spectrum Brands, Inc. is a global consumer products company with a diverse product portfolio including consumer batteries, lawn and garden, electric shaving and grooming, and household insect control and small appliances. Sales for the twelve months ended April 4, 2011 approximated $2.8 billion. STATION CASINOS: GVR and Aliante Debtors File Schedules ------------------------------------------------------- Green Valley Ranch Gaming LLC and the Aliante Debtors disclosed these assets and liabilities: Debtor Assets Debts ------ ------------ ------------ Green Valley Ranch Gaming LLC $482,501,271 $895,793,729 Aliante Gaming LLC $111,726,567 $439,845,690 Aliante Station LLC $1,552,419 $887,803,539 Aliante Holding LLC $4,550,349 $0 Statement of Financial Affairs Thomas M. Friel, senior vice president and treasurer of Green Valley Ranch Gaming LLC and the Aliante Debtors, disclosed that these Debtors earned income from employment or operation of their businesses since 2009: Green Valley Ranch Gaming LLC Jan. 1 to Mar. 31, 2011 ($14,694,152) Jan. 1 to Dec. 31, 2010 ($91,940,043) Jan. 1 to Dec. 31, 2009 ($17,542,201) Aliante Gaming LLC Jan. 1 to Mar. 31, 2011 ($7,167,082) Jan. 1 to Dec. 31, 2010 ($528,491,215) Jan. 1 to Dec. 31, 2009 ($57,895,549) Aliante Station LLC Jan. 1 to Mar. 31, 2011 ($2,438,421) Jan. 1 to Dec. 31, 2010 ($174,578,281) Jan. 1 to Dec. 31, 2009 ($61,456,421) Mr. Friel reveals that Green Valley and Aliante Gaming LLC paid certain creditors amounts exceeding $5,475 within the 90-day period before they filed for bankruptcy. Lists of the creditor payments are available for free at: http://bankrupt.com/misc/GVR3b.pdf http://bankrupt.com/misc/AlianteGaming3b.pdf Green Valley and Aliante Gaming were parties to suits and administrative proceedings within one year before they filed for Chapter 11 protection. Lists of the suits and administrative proceedings are available for free at: http://bankrupt.com/misc/GVR4a.pdf http://bankrupt.com/misc/AlianteGaming4a.pdf Green Valley also gave gifts, aggregating $4,126, while Aliante Gaming gave gifts, aggregating $27,791, one year before their Petition Dates. Within one year immediately preceding its Petition Date, Green Valley paid amounts aggregating $9,207,001 related to debt counseling or bankruptcy: Payee Amount ----- ------ Kirkland & Ellis $4,261,469 Houlihan Lokey $2,089,820 Oppenheimer & Co. $819,390 FTI Consulting $606,664 Orrick Herrington & Sutclife $139,945 Pillsbury Winthrop Shaw $121,356 Kelley Drye & Warren $103,434 Hennigan Bennett & Doman $76,411 Lionel Sawyer & Collins $75,000 Milbank Tweed Hadley McCloy $67,179 Shea & Carlyon $66,476 Emmett, Marvin & Martin $18,118 Latham & Watkins $3,564 Within one year immediately preceding its Petition Date, Aliante Gaming paid amounts, aggregating $5,618,645, related to debt counseling or bankruptcy: Payee Amount ----- ------ FTI Consulting $1,282,968 Kirkland & Ellis LLP $1,243,876 Oppenheimer & Co., Inc. $1,108,768 Paul Weiss Rifkind Wharton $575,735 Winstead Sechrest & Nimick $517,599 Houlihan Lokey $503,955 Lionel Sawyer & Collins $448,485 Alix Partners $100,000 Skadden Arps Slate Meagher $100,000 Full House Resorts $85,306 Milbank Tweed Hadley & McCloy LLP $29,295 Shea & Carlyon $22,653 Green Valley closed its Pari Mutuel account in the Bank of America with a $25,760 final balance one year before the Petition Date. Green Valley also held properties, aggregating $2,224,644, for another person, while Aliante Gaming held $165,378. The Debtors' books are currently held by Mr. Friel. The books were previously held by Curt Mayer, the Debtors' corporate vice president of finance, from May 7, 2007 to November 8, 2010. Aliante Gaming's books are currently held by Jerry Dorsey, Aliante Gaming's director of finance. His predecessor was Donald Tateishi, who performed services from March 11, 2009 to October 31, 2010. The Debtors' books are audited by Ernst & Young LLP. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. Station Casinos Inc., together with its affiliates, filed for Chapter 11 protection on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Milbank, Tweed, Hadley & McCloy LLP serves as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP is local counsel. Lazard Freres & Co. LLC is investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. Brad E Scheler, Esq., and Bonnie Steingart, Esq., at Fried, Frank, Shriver, Harris & Jacobson LLP, in New York, serves as counsel to the Official Committee of Unsecured Creditors. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Thirty-one affiliates of Station Casinos Inc. sought bankruptcy protection under Chapter 11 protection on April 12, 2011. First to file among the April 12 Debtors was Auburn Development, LLC (Bankr. D. Nev. Case No. 11-51188). The April 12 Debtors filed a prepackaged plan of reorganization together with their Chapter 11 petitions in order to reorganize debts and consummate the sale of the Green Valley Ranch Resort, Spa & Casino to a group of buyers led by the Fertitta family. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STATION CASINOS: U.S. Govt. Presents Issues on Appeal ----------------------------------------------------- The United States Government is appealing from the March 24, 2011 order entered by the U.S. Bankruptcy Court for the District of Nevada determining that the Debtors have no federal tax liability arising as a consequence of the consummation of their confirmed Plan of Reorganization and the related approved Restructuring Transactions. The Government is also electing to have the Appeal heard by the District Court rather than the Bankruptcy Appellate Panel. The U.S. Government wants the U.S. District Court for the District of Nevada to determine: 1. Whether the U.S. Bankruptcy Court for the District of Nevada erred in determining that no administrative tax claims against the Debtors would result from or arise out of the implementation of the Station Casinos Inc. Plan, the entry into or the closing of the Stalking Horse Asset Purchase Agreement or the other Restructuring Transactions contemplated thereby, and that as a result, neither the Debtors nor the Plan Administrator are obligated to establish a tax claims reserve. 2. Whether the Bankruptcy Court erred in determining that the Government is bound by any determinations contained in the Disclosure Statement, the Disclosure Supplement, the SCI Plan, the Plan Findings and Conclusions and the Confirmation Order, with respect to its ability to assess or collect any federal tax liability arising against any party or non-party, including but not limited to: a. Liabilities arising out of the implementation of the SCI Plan, the entry into or the closing of the Stalking Horse APA or the other Restructuring Transactions contemplated thereby; b. Whether the Purchaser or any other party will have successor or transferee liability of any kind or nature arising from or relating to the transactions contemplated under the SCI Plan; c. Liabilities arising under Section 3713 of the Money and Finance Code or Sections 6012(b)(3) and 6151(a) of the Internal Revenue Code. 3. Whether the Bankruptcy Court erred in granting relief that was not sought by the parties and was not fully briefed; and whether the Bankruptcy Court further erred in not permitting additional briefing at the government's suggestion. 4. Whether the Bankruptcy Court erred by effectively converting a Chapter 11 liquidating plan into a plan whose primary purpose is to avoid or evade taxes. 5. Whether the Bankruptcy Court erred in finding that the United States argued, "that the Court cannot make the Tax Determination or otherwise grant the relief sought in the Section 505 Motion because any potential tax liabilities arising from the implementation of the SCI Plan and related approved Restructuring Transactions arise after the Effective Date of the SCI Plan and therefore do not relate to the administration of the estate." 6. Whether the Bankruptcy Court erred in its conclusion of law that, "Rather, the Section 505 Order determines the amount of the Debtors' tax liability, as authorized by Bankruptcy Code section 505." 7. Whether the Bankruptcy Court erred in basing its ruling regarding the existence of administrative tax claims on "the uncontested facts submitted in support of the Section 505 Motion," when it did not determine which facts were uncontested. 8. Whether the Bankruptcy Court erred in determining that its ruling was not an "advisory opinion." Bankruptcy Judge Gregg W. Zive had granted the Debtors' motion, determining that they have no federal tax liability arising as a consequence of the consummation of their confirmed Plan of Reorganization and the related approved Restructuring Transactions. "Based upon the uncontested facts submitted in support of the Section 505 Motion, the Court concludes that no administrative tax claim(s) against the Debtors for income tax will result from or arise out of the implementation of the SCI Plan, the Stalking Horse APA or the other Restructuring Transactions contemplated thereby," Judge Zive explained in his Findings of Facts and Conclusions of Law. Therefore, he said, neither the Debtors nor the Plan Administrator will be obligated to establish the Tax Claims Reserve. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. Station Casinos Inc., together with its affiliates, filed for Chapter 11 protection on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Milbank, Tweed, Hadley & McCloy LLP serves as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP is local counsel. Lazard Freres & Co. LLC is investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. Brad E Scheler, Esq., and Bonnie Steingart, Esq., at Fried, Frank, Shriver, Harris & Jacobson LLP, in New York, serves as counsel to the Official Committee of Unsecured Creditors. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Thirty-one affiliates of Station Casinos Inc. sought bankruptcy protection under Chapter 11 protection on April 12, 2011. First to file among the April 12 Debtors was Auburn Development, LLC (Bankr. D. Nev. Case No. 11-51188). The April 12 Debtors filed a prepackaged plan of reorganization together with their Chapter 11 petitions in order to reorganize debts and consummate the sale of the Green Valley Ranch Resort, Spa & Casino to a group of buyers led by the Fertitta family. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STATION CASINOS: GV Ranch Proposes to Hire FTI as Advisor --------------------------------------------------------- Green Valley Ranch Gaming, LLC, and Aliante Gaming, LLC, and its debtor affiliates, seek the Bankruptcy Court's authority to employ FTI Consulting, Inc., as their financial advisor, nunc pro tunc to April 12, 2011. FTI will provide consulting and advisory services as the firm and Green Valley and the Aliante Debtors deem appropriate and feasible in order to advise the Debtors in the course of their Chapter 11 case, including but not limited to (i) assistance with various accounting and financial matters related to the Chapter 11 proceedings, including preparing the Statement of Financial Affairs, Schedules of Assets and Liabilities, and Monthly Operating Reports, and other compliance-related documents to meet the needs of the U.S. Trustee and the Bankruptcy Court; and (ii) other assistance as the Debtors may request and FTI agrees to perform. The Debtors will pay for the services of the FTI professionals according to the firm's hourly rates: Senior Managing Directors $710 - $825 Directors/Managing Directors $525 - $685 Consultants/Senior Consultants $255 - $480 Administration/Paraprofessionals $105 - $210 Michael M. Ozawa, a senior managing director at FTI Consulting, assures the Court that his firm is a "disinterested person" as the term is defined under Section 101(14) of the Bankruptcy Code. He maintains that his firm does not represent any interest adverse to Green Valley and its estates. Mr. Ozawa discloses that during the 90-day period prior to the Petition Date, Green Valley paid FTI $208,662. Also, prior to the Petition Date, Green Valley paid FTI a $100,000 retainer. FTI's unbilled fees to Green Valley as of the Petition Date were $25,142, and, subject to the approval of the Employment Application, will be applied against the retainer. The retainer balance as of the Petition Date will be $74,857. During the 90-day period prior to the Petition Date, the Aliante Debtors paid FTI $127,369, Mr. Ozawa adds. Also, prior to the Petition Date, the Aliante Debtors paid FTI a $100,000 retainer. FTI's unbilled fees to the Aliante Debtors as of the Petition Date were $25,818, and, subject to the approval of the Employment Application, will be applied against the retainer. The retainer balance as of the Petition Date will be $74,181. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. Station Casinos Inc., together with its affiliates, filed for Chapter 11 protection on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Milbank, Tweed, Hadley & McCloy LLP serves as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP is local counsel. Lazard Freres & Co. LLC is investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. Brad E Scheler, Esq., and Bonnie Steingart, Esq., at Fried, Frank, Shriver, Harris & Jacobson LLP, in New York, serves as counsel to the Official Committee of Unsecured Creditors. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Thirty-one affiliates of Station Casinos Inc. sought bankruptcy protection under Chapter 11 protection on April 12, 2011. First to file among the April 12 Debtors was Auburn Development, LLC (Bankr. D. Nev. Case No. 11-51188). The April 12 Debtors filed a prepackaged plan of reorganization together with their Chapter 11 petitions in order to reorganize debts and consummate the sale of the Green Valley Ranch Resort, Spa & Casino to a group of buyers led by the Fertitta family. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STATION CASINOS: GV Ranch Wins OK for Kirkland as Counsel --------------------------------------------------------- Green Valley Ranch Gaming, LLC, and Aliante Gaming, LLC, and its debtor affiliates, in separate filings, received authority to employ Kirkland & Ellis as their counsel nunc pro tunc to April 12, 2011. The April 12 Debtors need Kirkland & Ellis to perform these services: (a) advising the April 12 Debtors with respect to their powers and duties as debtors-in-possession in the continued management and operation of their businesses and properties; (b) advising and consulting on the conduct of these Chapter 11 cases, including all of the legal and administrative requirements of operating in Chapter 11; (c) attending meetings and negotiating with representatives of the creditors and other parties in interest; (d) taking all necessary actions to protect and preserve the April 12 Debtors' estates, including prosecuting actions on the Aliante Debtors' behalf, defending any action commenced against the April 12 Debtors, and representing them in negotiations concerning litigation in which they are involved, including objections to claims filed against the April 12 Debtors' estates; (e) preparing pleadings in connection with these Chapter 11 cases, including motions, applications, answers, orders, reports, and papers necessary or otherwise beneficial to the administration of the April 12 Debtors' estates; (f) representing the April 12 Debtors in connection with obtaining authority to continue using cash collateral and, if necessary, postpetition financing; (g) advising the Aliante Debtors in connection with any potential sale of assets or the restructuring of their businesses; (h) appearing before the Court and any appellate courts to represent the interests of the Aliante Debtors' estates; (i) advising the Aliante Debtors regarding tax matters; (j) taking any necessary action on behalf of the Aliante Debtors to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and (k) performing all other necessary legal services for the Aliante Debtors in connection with the prosecution of these chapter 11 cases, including: * analyzing the April 12 Debtors' leases and contracts and the assumption and assignment or rejection thereof; * analyzing the validity of liens against the April 12 Debtors; and * advising the April 12 Debtors on corporate and litigation matters. The April 12 Debtors will pay Kirkland & Ellis based on these hourly rates: Partners $695 to $995 Of Counsel $500 to $965 Associate $410 to $695 Paraprofessionals $140 to $300 These professionals are expected to have primary responsibility for providing services to the April 12 Debtors: James H.M. Sprayregen, P.C. $995 David R. Seligman $930 David A. Agay $770 Sarah H. Seewer $695 Sienna Singer $675 The April 12 Debtors will also reimburse Kirkland & Ellis for its necessary out-of-pocket expenses. On May 28, 2010, the Aliante Debtors paid $200,000 to Kirkland & Ellis as a classic retainer, which was subsequently increased to $300,000 on July 1, 2010 and $400,000 on July 30, 2010. On the same date, GVR paid $200,000 to Kirkland & Ellis as a classic retainer, which was increased to $300,000 on July 1, 2010; $400,000 on July 30, 2010; and $500,000 on August 10, 2010. David R. Seligman, Esq., a member of Kirkland & Ellis, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. Station Casinos Inc., together with its affiliates, filed for Chapter 11 protection on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Milbank, Tweed, Hadley & McCloy LLP serves as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP is local counsel. Lazard Freres & Co. LLC is investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. Brad E Scheler, Esq., and Bonnie Steingart, Esq., at Fried, Frank, Shriver, Harris & Jacobson LLP, in New York, serves as counsel to the Official Committee of Unsecured Creditors. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Thirty-one affiliates of Station Casinos Inc. sought bankruptcy protection under Chapter 11 protection on April 12, 2011. First to file among the April 12 Debtors was Auburn Development, LLC (Bankr. D. Nev. Case No. 11-51188). The April 12 Debtors filed a prepackaged plan of reorganization together with their Chapter 11 petitions in order to reorganize debts and consummate the sale of the Green Valley Ranch Resort, Spa & Casino to a group of buyers led by the Fertitta family. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SUMMIT BUSINESS MEDIA: Exits Chapter 11 Via Pre-Arranged Plan ------------------------------------------------------------- Summit Business Media has emerged from bankruptcy following approval of its "pre-arranged" plan of reorganization from the United States Bankruptcy Court for the District of Delaware. As a result, Summit has eliminated more than $140 million of long-term debt from its balance sheet, creating more financial flexibility to focus on the implementation of its growth strategy. "Summit emerges from this restructuring a leaner, more-focused and better-capitalized company," said Andrew Goodenough, Summit's President & CEO. "We are pleased to conclude this five-month process so that management, our board and our 400 associates can continue to focus on implementation of Summit's growth strategy." Goodenough added, "We are very focused on new product development and ways to meet the evolving needs of our customers. Product innovation allows us to leverage our strong brands and valuable franchises across the insurance, financial and professional services markets." 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. SUN PRODUCTS: Moody's Downgrades Corporate Family Rating to 'B2' ---------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family and Probability of Default ratings of Sun Products Corporation to B2 from B1 reflecting the company's deteriorating credit metrics due to the highly competitive laundry care business as well as higher input costs. The stable outlook reflects Moody's view that operating conditions will remain challenging for the company in the near-term, however, profitability and credit metrics should remain within acceptable ranges for a B2 credit. "Sun's credit metrics are likely to deteriorate further in the near-term as still highly aggressive promotional spending by large, deep-pocketed competitors combined with escalating raw material costs continue to depress category growth and profitability," said Moody's Vice President and Senior Credit Officer Janice Hofferber. RATINGS RATIONALE Sun Products' B2 corporate family rating reflects its high leverage, heightened competitive activity from better capitalized operators, primarily P&G and Church & Dwight and significant retailer concentration for its core private label and branded laundry care products. Moreover, the company's branded strategy remains unproven especially given challenges for mid-tier brands, requiring additional investment in a crowded space with limited growth opportunities. However, the rating benefits from a good liquidity profile full access to the company's revolving credit facility and no significant near-term debt maturities. Sun Products' ratings could be downgraded if category growth continues to decline and profitability remains weak. Specifically, ratings could be downgraded if debt-to-EBITDA is sustained above 6.5 times or free cash flow turned negative. Sun Products' ratings could be upgraded if operating performance and organic growth was restored such that debt-to-EBITDA was sustained below 5.0 times and free cash flow-to-debt was above 5%. These ratings of Sun Products were downgraded: -- Corporate family rating to B2 from B1; -- Probability of default rating to B2 from B1; * $125 million senior secured revolving credit facility due April 2013 to Ba3 (LGD2, 25%) from Ba2 (LGD2, 26%); * $798 million first lien term loan due April 2014 to Ba3 (LGD2, 25%) from Ba2 (LGD2, 26%); and * $225 million second lien term loan due October 2014 to B3 (LGD4, 61%) from B2 (LGD4, 62%). The principal methodology used in rating Sun Products was the Global Packaged Goods Industry Methodology, published July 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. The Sun Products Corporation ("Sun Products"), based in Wilton, Connecticut, is a leading provider of moderately priced and private label laundry detergents, fabric softeners and other related household and personal care products in the North America market. Significant brands include ALL, Snuggle, Sun Wisk, Sunlight (Canada), and Surf. The company is also the largest private label manufacturer of laundry care products in North America. Sun Products' parent company, Spotless Group Holding, LLC is controlled by affiliates of Vestar Capital Partners. Sun Products' sales for the fiscal year ended Dec. 31, 2010 exceeded $1.9 billion. SUNSTATE EQUIPMENT: Moody's Puts Caa2 Rating on Sr. Secured Notes ----------------------------------------------------------------- Moody's Investors Service has assigned a Caa2 rating to Sunstate Equipment Co., LLC 's proposed $170 million second priority senior secured notes due 2017. Concurrently, the outlook was changed to positive from stable based on the company's recent improvement in operating performance and being well positioned to capitalize on the improvement in the underlying factors supporting the gradual improvement in U.S. equipment rental industry trends. All ratings, including the Caa1 corporate family rating, have been affirmed. The rating agency did not rate the company's proposed $165 million ABL. Proceeds from the new issue of second priority senior secured notes combined with borrowings under the company's proposed ABL are expected to be used to repay amounts outstanding under Sunstate's existing second lien notes and borrowings under the existing ABL facility. Moody's views the refinancing as beneficial as it would lengthen Sunstate's debt maturity profile and provide incremental liquidity. Ratings assigned: -- Proposed $170 million second priority senior secured notes due 2017, Caa2 (LGD-5, 74%) Ratings affirmed with updated Loss Given Default assessments: -- Corporate family rating at Caa1 -- Probability of default rating at Caa1 -- Existing $108 million 10.5% second lien notes due April 2013 at Caa2 (LGD- 5, 79% (from LGD-5, 77%)) Upon conclusion of the proposed transaction, ratings for Sunstate's existing 10.5% second lien notes will be withdrawn. These ratings have been assigned subject to Moody's review of final documentation following completion of the proposed transaction. For additional information, please refer to the Credit Opinion to be posted on moodys.com. RATINGS RATIONALE The change in rating outlook to positive reflects Moody's expectation of a moderate improvement in the overall US equipment rental markets and the factors underlying that growth including anticipated growth in non-residential construction activity. An improvement in operating results for Sunstate over the last two quarters also supports the expectation that this trend should continue as the overall industry stabilizes. The company's proposed refinancing would further support the outlook by addressing more near term maturities in 2012 and 2013. Furthermore, cost reduction efforts that took place during the most recent cyclical trough could contribute to profitability over the intermediate term as the overall market gradually recovers and the company benefits from the efficiencies it was able to achieve during the downturn. The Caa1 corporate family rating reflects metrics that are improving but still recovering from the negative impact on Sunstate's operating results from the company's exposure to the particularly weak construction markets in the Southwestern U.S. region, particularly Nevada, California and Arizona. This region was hard hit during the most recent economic downturn due to the overdevelopment that had taken place in that region. Moreover, the age of the company's fleet versus peers is on the higher end resulting in the company's need to continue to invest in capital expenditures to replace fleet and acquire new equipment to support anticipated growth in its end markets. Due to the expected negative free cash flow over the next twelve months stemming from the capital expenditure requirements, there could be less funds over the near-term to reduce debt levels meaningfully. The rating and positive outlook are supported by the expectation for an adequate liquidity profile over the next twelve months, despite anticipated negative free cash flow, due to availability under the proposed ABL facility. As the value of equipment rental fleet improves, the company is anticipated to continue to have access to funds available under the committed facility. The proposed refinancing would benefit the company's profile by extending Sunstate's debt maturity profile as well as potentially including covenants in the new ABL facility that provide more headroom than the existing facility. Upward rating momentum would likely coincide with continued improvement in the company's metrics such that debt/EBITDA would be sustained at or below 6.0 times while maintaining an adequate liquidity profile including expected adequate covenant headroom which could also be addressed with the proposed refinancing. The ratings and/or outlook could be negatively impacted if the company's ability to cover its interest expense declines materially from current levels, leverage metrics increase or if adequacy of the liquidity profile were to come into question. The principal methodology used in rating Sunstate Equipment Co., LLC was the Global Equipment and Automobile Rental 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. Sunstate Equipment Co. LLC, headquartered in Phoenix, AZ, is a regional equipment supplier with 52 branches predominately in the Southwestern U.S. Revenues for the last twelve month period ended March 31, 2011 totaled roughly $150 million. SUNSTATE EQUIPMENT: S&P Rates $170MM Second-Lien Notes at 'CCC+' ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'CCC+' issue-level rating and '5' recovering rating, indicating S&P's expectation of a modest recovery (10%-30%) in the event of a payment default, to Phoenix, Ariz.-based Sunstate Equipment Co. LLC's (Sunstate) proposed $170 million second-lien notes due 2017. "Our 'B-' corporate credit rating on Sunstate remains unchanged. Together with proceeds from a proposed new unrated asset-based loan (ABL) credit facility, we expect Sunstate to use proceeds from the note offering to repay all of its existing outstanding debt. The proposed refinancing provides adequate liquidity and flexibility by pushing out maturities comfortably over the next five years. The outlook is stable," S&P stated. "The ratings on privately owned Sunstate reflect our assessment of its weak business risk profile as a regional operator in the highly fragmented and competitive construction equipment rental industry. This profile also reflects the company's limited diversity, capital intensive equipment purchases, high leverage, and somewhat limited financial flexibility. Sunstate's good regional presence in the southwestern U.S., focus on customer service, and good EBITDA margin somewhat offset these factors. Despite the still relatively weak construction end-markets, we expect Sunstate's operating performance to improve gradually as conditions in the equipment rental sector recover. Sunstate experienced a 20% increase in sales in the first quarter of 2011. Equipment rental companies have seen an increase in volume recently, because contractors rely more on rentals due to the limited number of projects and uncertainty on future projects, as well as the trend of outsourcing equipment from rental companies, especially among industrial customers. The rating and outlook remain unchanged at this point until we see clear evidence of a strong uninterrupted recovery in industry conditions that result in much improved credit measures," according to S&P. Rating List Sunstate Equipment Co. LLC Corporate credit rating B-/Stable New Rating Sunstate Equipment Co. LLC Sunstate Equipment Co. Inc. $170 mil. 2nd lien notes due 2017 CCC+ Recovery rating 5 SUPER FRESH: Village Super Market to Acquires Two Stores -------------------------------------------------------- Village Super Market, Inc. anticipates acquiring the store fixtures, leases and other assets of locations in White Oak, Maryland and Timonium, Maryland for approximately $6.6 million. The purchase of these stores from Super Fresh is part of a larger purchase by a consortium, and is subject to bankruptcy court approval and other conditions. The closing is expected in approximately one month, with these stores expected to open as ShopRites this summer. "We are very pleased to provide ShopRite's commitment to customer service, variety, value and low prices to these new locations," said James Sumas, Chief Executive Officer of Village Super Market, Inc. "We look forward to furthering Village Super Market's vision of helping families live better by creating good union jobs that will provide great value and excellent service to our customers." Village Super Market operates a chain of 26 supermarkets under the ShopRite name in New Jersey and eastern Pennsylvania. SUSSEX COUNTY: S&P Raises Ratings on Revenue Bonds From 'B/B' ------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on Sussex County, Del.'s series 1997A and 1997B variable-rate demand revenue bonds to 'A/A-1' from 'B/B'. "At the same time, we removed our ratings from CreditWatch with positive implications, where we had placed them on Nov. 3, 2010," S&P stated. S&P continued, "Our ratings on the two affected bond issues reflect our opinion of the credit and liquidity support that Wilmington Trust Co., Del. ('A/A-1') provides in the form of irrevocable direct-pay LOCs. The long-term components of our ratings are based on our long-term issuer credit rating on Wilmington Trust Co., Del., and address the full and timely payments of interest and principal when the bondholders have not exercised the put option. The short-term components of our ratings are based on our short-term issuer credit rating on Wilmington Trust Co., Del., and address the full and timely payments of interest and principal when the bondholders have exercised the put option." "The rating actions reflect the May 16, 2011, raising of our long- term issuer credit rating on Wilmington Trust Co., Del., to 'A' from 'B' and our short-term rating to 'A-1' from 'B', following the acquisition of Wilmington Trust Co., Del.'s parent, Wilmington Trust Corp., by M&T Bank Corp. (for more information, see "Wilmington Trust Corp. Upgraded After Acquisition By M&T Bank Corp.; Outlook Negative"). At that time, we also removed our long-term and short-term ratings on the LOC provider from CreditWatch positive, where we had placed them on Nov. 1, 2010," S&P related. "In view of the bonds' structures, changes to our ratings on the bonds can result from, among other things, changes to our rating on the LOC provider or amendments to the transactions' terms," S&P added. Ratings Raised and Removed From CreditWatch Positive Transaction CUSIP Rating To From Sussex County, Del. $2.4 million variable-rate demand revenue bonds series 1997A due 11/01/2027 86926RBH2 A/A-1 B/Watch Pos/B $3 million variable-rate demand revenue bonds series 1997B due 11/01/2027 86926RBJ8 A/A-1 B/Watch Pos/B TENNECO INC: S&P Raises Corp. Rating to 'BB' on Strong Sales ------------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Lake Forest, Ill.-based auto supplier Tenneco Inc. to 'BB' from 'BB-'. The outlook is stable. "At the same time, we raised our issue-level ratings on the company's senior secured first-lien debt to 'BBB-' and the senior unsecured debt to 'BB-'. The recovery ratings on the debt remain unchanged," S&P related. "The upgrade reflects our opinion that Tenneco's credit profile has risen to levels consistent with the 'BB' rating and that the company can sustain the improvement," said Standard & Poor's credit analyst Lawrence Orlowski. "We believe the recovery in light-vehicle production in North America and Europe will continue and that, in addition to strong aftermarket sales growth during the past year, the company's ongoing expansion in the commercial- vehicle market is expected to contribute to increased growth and a more diversified revenue stream. We expect light-vehicle production in 2011 for North America and Europe to increase over 8% and over 2%, respectively. We see heavy-duty commercial-vehicle production in 2011 in North America and Europe rising about 39% and 25%." "We believe important factors of ongoing growth include the need to replace aging vehicles, the effect of relaxed monetary and fiscal policies in spurring economic demand, and strong emerging market growth," explained Mr. Orlowski. "Still, we assume that both light- and commercial-vehicle markets will remain volatile and highly competitive." TEREX CORP: S&P Affirms 'BB-' Corp. Credit Rating; Outlook Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating (CCR) on Westport, Conn.-based Terex Corp. and assigned its 'BB' issue-level and '2' recovery ratings to the company's proposed $750 million term loan and proposed $500 million revolving credit facility. "Terex will use proceeds from the term loan, along with cash, for its proposed acquisition of Demag Cranes AG (not rated), a Germany-based supplier of industrial cranes, port technology, and related services. At the same time, we are revising our recovery rating on the company's unsecured notes to '4' from '3' (the issue-level rating remains unchanged at 'BB-'). The outlook is stable," S&P stated. "Under the proposed transaction terms for the Demag acquisition, we believe Terex will return credit measures to levels consistent with the 'BB-' corporate credit rating within a year of finalizing the acquisition," said Standard & Poor's credit analyst Dan Picciotto. "Excluding the Demag acquisition, we would expect credit measures to meet our range of expectations this year, including funds from operations (FFO) to total debt of 15%-20% (this measure was less than 10% at the end of the first quarter). Terex currently has a good liquidity position, with large cash balances and availability under its revolving credit facility, although the company will use about $600 million of this cash balance for the Demag transaction at the current offering price. We believe the acquisition would complement Terex's existing crane businesses, which generated close to $1.1 billion in sales in 2010 (about 25% of total sales), though we would still view Terex's business risk profile assessment as fair, pro forma for the transaction." The outlook is stable. "If Terex completes the Demag acquisition at the current offer price, we believe credit measures would be likely to meet our expectations for the rating within about one year. We believe that even moderate increases in the offer price for Demag (for example, up to 20%) would also result in our expectations being realized given favorable market trends," S&P continued. "We could lower the ratings if, for instance, a rising offer price for Demag or other debt-financed activity resulted in our expectation that FFO to total adjusted debt would remain below 15% for more than one year and excess cash balances were not significant," Mr. Picciotto added. "We could raise the ratings if the company generates adjusted FFO to total debt approaching 20% and we expect further, sustained improvement that would result in meaningfully positive free cash flow generation of $200 million or more, on average, annually for the next few years." TIB FINANCIAL: Files Form 10-Q; Posts $1.06MM Net Income in Q1 -------------------------------------------------------------- TIB Financial Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting net income of $1.06 million on $15.84 million of total interest and dividend income for the three months ended March 31, 2011, compared with a net loss of $5.05 million on $18.28 million of total interest and dividend income for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $1.72 billion in total assets, $1.54 billion in total liabilities and $186.98 million in total shareholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/TWKNz7 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. 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. UNITED SECURITY: A.M. Best Lifts Fin'l Strength Rating to 'C-' -------------------------------------------------------------- A.M. Best Co. has upgraded the financial strength rating to C- (Weak) from D (Poor) and issuer credit rating to "cc" from "c" of United Security Life and Health Insurance Company (USL&H) (Bedford Park, IL). The outlook for both ratings has been revised to stable from negative. The upgrades reflect USL&H's quarterly profitability and improving risk-adjusted capital position since March 2010. In addition, the company adopted a more conservative investment philosophy by reducing its exposure to common and preferred equities and investing in investment grade bonds and short-term securities. In recent years, USL&H has posted sizeable losses in its individual major medical business, which represented 94% of its 2010 premium revenue. These earlier losses considerably reduced USL&H's capital and surplus position. A.M. Best believes the Patient Protection and Affordable Care Act will continue to pose considerable future challenges for small individual major medical companies like USL&H, which do not have the economies of scale to operate profitably at a mandated 80% medical loss ratio. US FOODSERVICE: S&P Assigns 'B' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Rating Services assigned its 'B' corporate credit rating to Rosemont, Ill.-based U.S. Foodservice Inc. (USF). "At the same time, we assigned our 'B-' rating to the company's $425 million senior secured term loan due 2017 and 'CCC+' rating to the $400 million 8.5% senior unsecured notes due 2019. The outlook is stable," S&P stated. The recovery rating on the senior secured term loan is '5', indicating that lenders could expect modest (10% to 30%) recovery in the event of a payment default or bankruptcy. The recovery rating on the senior unsecured notes is '6', indicating that lenders could expect negligible (0% to 10%) recovery in the event of a payment default or bankruptcy. Pro forma for the transaction, total debt outstanding is about $4.75 billion. "Our ratings on USF reflect our opinion that the highly leveraged food service distributor's profit margins will likely deteriorate over the near term due to potentially lower demand and higher expenses, specifically escalating food and fuel costs," said Standard & Poor's credit analyst Jerry Phelan. "However, credit measures should remain near current levels due to interest cost savings and modest debt repayment associated with its refinancing." Nevertheless, pro forma for the refinancing, the company's credit protection measures are weak for the 'B' rating category medians, including leverage in the high-7x area and the ratio of funds from operations (FFO) to total debt of about 7.3%. The outlook is stable. Standard & Poor's believes the company should be able to maintain credit measures near current levels despite prospects for higher food and fuel costs. USG CORP: Four Directors Elected at Annual Meeting -------------------------------------------------- USG Corporation held its 2011 annual meeting of stockholders on May 11, 2011. At the annual meeting, the stockholders approved, among other things: (1) election of four directors for a three-year term to expire in 2014: Gretchen R. Haggerty, Richard P. Lavin, Marvin E. Lesser, and James S. Metcalf; (2) ratification of appointment of Deloitte & Touche LLP as the Company's independent registered public accountants for 2011; and (3) approval, by advisory vote, of the compensation of the Company's named executive officers. 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. The Company's balance sheet at March 31, 2011 showed $4.01 billion in total assets, $3.46 billion in total liabilities and $544 million in total stockholders' equity. VALLEY ROAD: S&P Withdraws 'BB' Credit Rating After Debt Paydown ---------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its 'BB+' credit rating on Valley Road Funding LLC after receiving confirmation that U.S. electric generating business Valley Road Holdings LLC (Holdings) successfully completed the sale of the Griffith power plant to Star West Generation LLC. Holdings has fully repaid and terminated its senior secured credit facilities at its subsidiary Valley Road Funding. "We also withdrew the '1' recovery rating on the facilities," S&P stated. The facilities consisted of a $215 million senior secured first- lien term loan, a $50 million senior secured revolving first-lien letter of credit facility, and $30 million senior secured first- lien revolver (all due November 2014). Ratings List Ratings Withdrawn To From Valley Road Funding LLC $215 mil sr secd first-lien term loan NR BB+/Watch Pos Recovery rating NR 1 $50 mil sr secd LOC facility NR BB+/Watch Pos Recovery rating NR 1 $30 mil sr secd revolving credit facility NR BB+/Watch Pos Recovery rating Nr 1 VILICA LLC: Hires Coldwell Banker as Real Estate Broker ------------------------------------------------------- Vilica LLC asks the U.S. Bankruptcy Court for the Northern District of California for permission to employ Coldwell Banker Cutten Realty as real estate broker. Coldwell Banker will represent the Debtor in the sale of the Debtor's various parcels of real properties located in Trinity County, California. The general terms of the agreement between the Debtor and the proposed real estate broker with regard to the real property are: a. The sales price of the real property located in the city of Willow Creek, county of Humboldt, Brush Mountain G-1, APN No. 524-016-007 will be $400,000.00; b. The sales price of the real property located in the city of Willow Creek, county of Humboldt, Madden Creek: G-2, APN No. p.o. 524-122-001 SW 1/4 will be $250,000.00; c. The sales price of the real property located in the city of Willow Creek, county of Humboldt, Madden Creek: G-3, APN No. p.o. 524-122-001 SE 1/4 will be $250,000.00; d. The sales price of the real property located in the city of Willow Creek, county of Humboldt, Madden Creek: G-4, APN No. p.o. 524-122-001 NE 1/4 will be $250,000.00; e. The sales price of the real property located in the city of Redwood Valley, county of Humboldt, Pine Creek: H-2, APN No. 522-012-001 will be $320,000.00; f. The sales price of the real property located in the city of Redwood Valley, county of Humboldt, Pine Creek: H-3, APN No. 522-012-002 will be $450,000.00; g. The sales price of the of real property located in the city of Weitchpec, county of Humboldt, Bald Hills Rd: N, APN Nos. 531-011-007 & 531-012-005 will be $240,000.00; h. The compensation sought by the proposed real estate broker with regard to all of these real properties is equal to 6% of the gross sales price; and i. Any sale of the property and/or payment of commission is subject to approval by the United States Bankruptcy Court. The Debtor assures the Court that Charlie Tripodi, real estate agent, and said real estate firm are a "disinterested persons" within the meaning of Section 101(14) of the Bankruptcy Code. About Vilica, LLC Santa Cruz, California-based Vilica, LLC, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Calif. Case No. 10-62728) on Dec. 13, 2010. Stephen T. Davies, Esq., at Turner Litigation Services, serves as the Debtor's bankruptcy counsel. According to its schedules, the Debtor disclosed $12,757,273 in total assets and $4,245,843 in total debts at the Petition Date. VILICA LLC: Taps Weaverville Realty as Real Estate Broker --------------------------------------------------------- Vilica LLC asks the U.S. Bankruptcy Court for the Northern District of California for permission to employ Weaverville Realty as real estate broker. Weaverville Realty will represent the Debtor in the sale of the Debtor's various parcels of real properties located in Trinity County, California. The general terms of the agreement between the Debtor and the proposed real estate broker with regard to the real property are: a. The sales price of the real property located in the city of Coffee Creek, county of Trinity, Bonanza Mine, portion of APN No. 007-170-03 will be $234,000.00; b. The sales price of the real property located in the city of Coffee Creek, county of Trinity, Cold Spring Mine, APN No. 997-170-01 will be $171,820.00; c. The sales price of the real property located in the city of Coffee Creek, county of Trinity, Log Cabin Mine, portion of APN No. 007-170-03 will be $187,950.00; d. The sales price of the real property located in the city of Coffee Creek, county of Trinity, Red Rock Mine, APN No. 007-170-02 will be $224,290.00; e. The sales price of the real property located in the city of Coffee Creek, county of Trinity, Sunrise Mine, portion of APN No. 007-170-03 will be $190,700.00; f. The sales price of the real property located in the city of Coffee Creek, county of Trinity, portion of APN No. 007-170-03 will be $199,000.00; g. The compensation sought by the proposed real estate broker with regard to all of the real properties is equal to 8% of the gross sales price; and h. Any sale of the property and/or payment of commission is subject to approval by the United States Bankruptcy Court. The Debtor assures the Court that Steve Hanover, real estate agent, and said real estate firm are a "disinterested persons" within the meaning of Section 101(14) of the Bankruptcy Code. About Vilica, LLC Santa Cruz, California-based Vilica, LLC, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Calif. Case No. 10-62728) on Dec. 13, 2010. Stephen T. Davies, Esq., at Turner Litigation Services, serves as the Debtor's bankruptcy counsel. According to its schedules, the Debtor disclosed $12,757,273 in total assets and $4,245,843 in total debts at the Petition Date. WASHINGTON MUTUAL: Plan Confirmation Hearing Adjourned to June 29 ----------------------------------------------------------------- Washington Mutual, Inc. filed a Notice of Adjournment regarding the hearing to consider confirmation of the Company's Modified Sixth Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of the United States Bankruptcy Code, dated Feb. 7, 2011. Despite reports to the contrary, discussions with respect to modifying or amending the Modified Plan are ongoing, and the confirmation hearing with respect to the presently filed Modified Plan has been scheduled for June 29, 2011 at 9:30 a.m. Eastern Time. In addition, in an effort to accommodate the ongoing discussions, WMI has agreed to extend the deadline for the Official Committee of Equity Security Interest Holders to file an objection or response to the Modified Plan has been extended to June 10, 2011 at 4:00 p.m. Eastern Time. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. Fred S. Hodera, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York City and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unseucred Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired WaMu's assets prior to the Petition Date. On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan Chase Bank, N.A., upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. Additionally, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. Washington Mutual has filed with the U.S. Bankruptcy Court for the District of Delaware a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement. The Company believes that the Modified Plan has addressed the Bankruptcy Court's concerns and looks forward to returning to the Bankruptcy Court to seek confirmation of the Modified Plan. The hearing for approval of the Disclosure Statement is set for March 21. WASHINGTON MUTUAL: Equity Committee Proposes BDO as Tax Advisor --------------------------------------------------------------- BankruptcyData.com reports that Washington Mutual's official committee of equity security holders filed with the U.S. Bankruptcy Court a motion to retain BDO USA (Contact: Kevin D. Anderson) as tax advisor at the following hourly rates: partner at $475 to $795 and director/senior manager at 375 to 600. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York City and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan Chase Bank, N.A., upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. Additionally, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. Washington Mutual has filed with the U.S. Bankruptcy Court for the District of Delaware a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement. The Company believes that the Modified Plan has addressed the Bankruptcy Court's concerns and looks forward to returning to the Bankruptcy Court to seek confirmation of the Modified Plan. WEST END FINANCIAL: Consolidation Opposed by U.S. Trustee --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Trustee who is trying to oust Raymond J. Heslin from the management of West End Financial Advisors LLC is opposing Mr. Heslin's motion for substantive consolidation of the firm and its investment funds. The U.S. Trustee is in the middle of a trial that began in March to appoint a Chapter 11 trustee. The trial is scheduled to resume on May 24, when the bankruptcy judge's consolidation motion is also on the calendar. According to the report, Mr. Heslin last week filed combined schedules of the assets and debts of West End and its funds. They show assets of $400,000 and debts of $6.7 million, not including $66 million from investors who may or may not be creditors. Debt includes $5.5 million in secured claims, according to the schedules. The U.S. Trustee contends that consolidation shouldn't be allowed because the schedules weren't filed before the motion, thus depriving creditors of insight into West End's financial condition. The U.S. Trustee accuses Mr. Heslin of not providing requested information and of failing to file monthly operating reports. About West End Financial West End Financial Advisors LLC, Sentinel Investment Management Corp. and a number of affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-11152) in Manhattan on March 15, 2011. New York-based West End estimated its assets and debts at $1 million to $10 million. Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as the Debtors' bankruptcy counsel. William Landberg created WEFA in 2000 as an investment and financial management company. Subsequently he purchased Sentinel Investment Management Corp., a boutique investment advisory company. Sentinel and WEFA targeted individual private clients for investments in fixed income funds and alternative investment products. Mr. Landberg's ultimately resigned from all West End related entities effective June 2, 2009, following a probe on misappropriation of funds. Secured creditors with the largest claims are DZ Bank ($118.1 million), West LB ($41 million), Iberia Bank ($11.3 million), and Suffolk County National Bank ($8.3 million). WILLIAM LYON: Incurs $136.78 Million Net Loss in 2010 ----------------------------------------------------- William Lyon Homes filed with the U.S. Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss attributable to William Lyon Homes of $136.78 million on $294.69 million of operating revenue for the year ended Dec. 31, 2010, compared with a net loss attributable to William Lyon Homes of $20.52 million on $309.24 million of operating revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $649.00 million in total assets, $623.62 million in total liabilities, $25.38 million in equity. A full-text copy of the Form 10-K is available for free at: http://is.gd/JinMUt About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. * * * William Lyon carries 'CCC' issuer credit ratings from Standard & Poor's, and 'Caa2' long term corporate family and probability of default ratings from Moody's. "S&P raised its rating on William Lyon Homes because S&P believes that near-term liquidity pressure has eased somewhat following the partial funding of a secured term loan and reduced maturing credit facility debt," said credit analyst James Fielding in November 2009 when S&P raised the rating on William Lyon to 'CCC' from 'CCC-'. He added, "However, this privately held homebuilder remains very highly leveraged and may face challenges repaying or refinancing intermediate-term debt maturities if its business prospects don't improve in the interim." Standard & Poor's Ratings Services raised its rating on William Lyon Homes' 10.75% senior unsecured notes due 2013 to 'CC' from 'D' after the company repurchased $10.5 million of outstanding principal for $9.0 million. S&P lowered its rating on the notes to 'D' because S&P considered the discounted repurchase to be tantamount to default under its criteria for exchange offers and similar restructurings. In accordance with its criteria, S&P is now raising its rating on these notes because the company completed its repurchase, and S&P is not aware of additional discounted repurchases at this time. WILLIAM LYON: Delays Filing of March 31 Form 10-Q ------------------------------------------------- As previously announced in the current reports on Form 8-K of William Lyon Homes filed on March 21, 2011, and on April 18, 2011, the Company said it required additional time to conduct and finalize its non-cash impairment analysis under the provisions of Financial Accounting Standards Board Accounting Standard Codification Topic 360 Property, Plant and Equipment in connection with its annual audit for the year ended Dec. 31, 2010. Accordingly, until May 13, 2011, the Company's financial staff devoted its time and resources principally to finalizing the Company's Annual Report on Form 10-K and was unable to devote significant time and resources to the Company's financial statements to be included in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2011. As a result, the Company will require additional time to complete the financial statements to be included in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2011. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. The Company's balance sheet at Dec. 31, 2010, showed $649.00 million in total assets, $623.62 million in total liabilities, $25.38 million in equity. * * * William Lyon carries 'CCC' issuer credit ratings from Standard & Poor's, and 'Caa2' long term corporate family and probability of default ratings from Moody's. "S&P raised its rating on William Lyon Homes because S&P believes that near-term liquidity pressure has eased somewhat following the partial funding of a secured term loan and reduced maturing credit facility debt," said credit analyst James Fielding in November 2009 when S&P raised the rating on William Lyon to 'CCC' from 'CCC-'. He added, "However, this privately held homebuilder remains very highly leveraged and may face challenges repaying or refinancing intermediate-term debt maturities if its business prospects don't improve in the interim." Standard & Poor's Ratings Services raised its rating on William Lyon Homes' 10.75% senior unsecured notes due 2013 to 'CC' from 'D' after the company repurchased $10.5 million of outstanding principal for $9.0 million. S&P lowered its rating on the notes to 'D' because S&P considered the discounted repurchase to be tantamount to default under its criteria for exchange offers and similar restructurings. In accordance with its criteria, S&P is now raising its rating on these notes because the company completed its repurchase, and S&P is not aware of additional discounted repurchases at this time. WIZZARD SOFTWARE: Posts $606,800 First Quarter Net Loss ------------------------------------------------------- Wizzard Software Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $606,759 on $1.6 million of revenues for the three months ended March 31, 2011, compared with a net loss of $1.4 million on $1.3 million of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $23.6 million in total assets, $725,127 in total liabilities, and stockholders' equity of $22.9 million. As reported in the TCR on April 6, 2011, Gregory & Associates, LLC, in Salt Lake City, Utah, expressed substantial doubt about Wizzard Software's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has not yet established profitable operations and has incurred significant losses since its inception. A complete text of the Form 10-Q is available for free at: http://is.gd/MmwGik Pittsburgh, Pa.-based Wizzard Software Corporation's business includes Media, Software and Healthcare. Wizzard's core focus is on its Media business, which consists of providing podcasting hosting, distribution, audience analysis, advertising, content subscriptions and App sales for podcast producers worldwide. The legacy Software business focuses on selling and supporting speech recognition and text-to-speech technology from IBM and AT&T. The legacy Healthcare business focuses on providing home health services and nurse staffing in the Western part of the United States. WILLIAM SWITZER: Chapter 15 Case Summary ---------------------------------------- Chapter 15 Petitioner: Michale J. Vermette PricewaterhouseCoopers, Inc. Chapter 15 Debtor: William Switzer & Associates, Ltd. #6-611 Alexander Street Vancouver, BC V6A 1E1 Canada Chapter 15 Case No.: 11-12449 Type of Business: The debtor is a private company that manufactures and deals furniture. Chapter 15 Petition Date: May 20, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Yann Geron, Esq. FOX ROTHSCHILD, LLP 100 Park Avenue, Suite 1500 New York, NY 10017 Tel: (212) 878-7900 Fax: (212) 692-0940 E-mail: ygeron@foxrothschild.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of creditors together with its petition. WINDSOR FINANCING: S&P Rates $268.5-Million Bonds at 'B+' --------------------------------------------------------- Standard & Poor's Rating Services affirmed its ratings on U.S. power generator Windsor Financing LLC. "We also changed the outlook on the $268.5 million amortizing 5.881% senior secured bonds issued in 2006 and due Jan. 15, 2017 (about $150 million outstanding currently) to positive from negative. The rating on the senior bonds is 'B+'. At the same time, we changed our outlook on the company's $52 million 6.927% subordinated secured notes issued in 2006 and due Jan. 15, 2016 (amortized to $39.3 million principal outstanding at Dec. 31, 2008 and accruing since about that date) to positive from negative. The rating on the subordinate notes is 'CCC+'," S&P related. The positive outlook reflects the company's announcement on May 11, 2011 that it intends to fully refund its outstanding debt with proceeds from a new debt issuance. The prior negative outlook reflected the company's weak levels of debt service coverage from operating cash flow. The recovery rating on the senior bonds remains '3', indicating meaningful (50%-70%) recovery if a payment default occurs. The '6' recovery rating on the subordinated notes indicates negligible (0%-10%) recovery. The rating reflects Windsor's continued low debt service coverage, with senior lien coverage of 1.09x in 2009, 1.02x in the 12 months ending Sept. 30, 2010, and projected by company management to be about 1x for 2011. The company hasn't paid subordinate debt service since the second half of 2008 and company management does not expect to pay subordinate debt service through most of 2011 either. "The positive outlook reflects our expectation Windsor will fully refund the senior and subordinate debt in the near term in accordance with the senior and subordinate legal provisions," said Standard & Poor's credit analyst Matthew Hobby. "If the project were to abandon or significantly delay its refinancing plan, then we would likely return the outlook to negative, reflecting the project's weak underlying cash flow coverage of debt service," S&P related. WINFREE ACADEMY: S&P Lowers Rating on $8.24MM Bonds to 'BB+' ------------------------------------------------------------ Standard & Poor's Ratings Services lowered its long-term rating to 'BB+' from 'BBB-' on La Vernia Higher Education Finance Corp., Texas' $8.24 million series 2009 education revenue bonds, issued on behalf of Winfree Academy Charter Schools. The outlook is stable. "The rating action reflects our view of significant worsening of operations in fiscal 2010, an expectation of very marginal operational profitability in budget 2011, a decline in operational liquidity in fiscal 2010, and enrollment volatility and a limited wait list," said Standard & Poor's credit analyst Kevin Holloran. School officials used the 2009 bond proceeds to purchase a campus, assume two loans related to other campuses, and make improvements to those campuses. Winfree Academy Charter Schools is a collection of open-enrollment schools in Dallas County and Denton County. WORLDGATE COMMUNICATIONS: Posts $4.6 Million Net Loss in Q1 2011 ---------------------------------------------------------------- WorldGate Communications, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $4.6 million on $5.3 million of net revenue for the three months ended March 31, 2011, compared with a net loss of $2.8 million on $200,000 of net revenue for the same period last year. Revenue for the three months ended March 31, 2011, includes $5,228,000 with related parties. The Company's balance sheet at March 31, 2011, showed $9.7 million in total assets, $15.9 million in total liabilities, and a stockholders' deficit of $6.2 million. As reported in the TCR on April 12, 2011, Marcum LLP, in New York, expressed substantial doubt about WorldGate Communications' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that of the Company's recurring losses from operations, working capital deficiencies and stockholders' deficit. A complete text of the Form 10-Q is available for free at: http://is.gd/QCSPTX Trevose, PA, WorldGate Communications, Inc. (OTC BB: WGAT.OB) designs and develops innovative digital video phones featuring high quality, real-time, two-way video. W.R. GRACE: IDOR Says Claims Valid in Absence of Tax Returns ------------ ----------------------------------------------- W.R. Grace & Co. are asking the Bankruptcy Court to disallow The Illinois Department of Revenue's Claim No. 150, filed on June 7, 2001, for $3,486,130 in unpaid withholding taxes, associated penalties and prepetition interest. The IDOR filed the claim asserting that the Debtors failed to pay applicable payroll taxes for tax years 1976 and 1984 through 1989. Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, & Jones LLP, in Wilmington, Delaware, counsel to the Debtors, note that applicable Illinois law bars those claims if IDOR fails to notify a taxpayer within three years of the proposed tax deficiency. Ina response, Lisa Madigan, Illinois Attorney General, tells Judge Judith Fitzgerald that the Illinois Department of Revenue filed a withholding tax claim for various quarters in 1976 and 1984 through 1989. She asserts that the claim was filed because, according to IDOR's records, W.R. Grace failed to file withholding tax returns or remit the related taxes during 1976 and, after doing so during the intervening years, again failed to file withholding tax returns of remit the taxes during the period from 1984 through 1989. Based on the Debtor's failure to file returns and pay the related taxes, IDOR estimated liability for these "open" quarters by projecting liability from other tax periods for which returns were filed and, based on this projected liability, filed Claim No. 150. In their objection against the Claim, the Debtors contended that the liability asserted in Claim No. 150 is unenforceable as IDOR failed to issue Notices of Deficiency for these quarters within the statute of limitations of Section 905(j) of the Illinois Income Tax Act, Ms. Madigan notes. She argues that while IDOR acknowledges that it did not issue NODs, the Debtors misconstrue the effect and application of the statute of limitations set forth in the Illinois Income Tax Act. She explains that Section 905(j) applies to establish a statute of limitations in those situations where the taxpayer filed returns. Where a taxpayer fails to file returns, there is no statute of limitations, Ms. Madigan asserts, and therefore, the Claim cannot be disallowed on this basis. Unless the Debtor files returns for the "open" quarters or can demonstrate that it did not have Illinois employees during these quarters, and therefore, had no liability, the Court should allow IDOR's Claim as filed, she insists. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on Jan. 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Registers 2,100,000 Shares for Stock Incentive Plan --------------------------------------------------------------- In a Form S-8 filed with the U.S. Securities and Exchange Commission on April 28, 2011, W.R. Grace & Co. registered 2,100,000 shares of common stock with a proposed maximum aggregate offering price of $85,470,000. The number of shares represents the maximum number of shares issuable under the W. R. Grace & Co. 2011 Stock Incentive Plan. The validity of the Common Stock offered in the Registration Statement will be opined upon by Mark A. Shelnitz, Esq., vice president, general counsel and secretary of W. R. Grace & Co. He owns shares of the Company's Common Stock, and holds options to purchase shares of the Common Stock under one or more of the Company's stock incentive plans. As an executive officer of the Company, Mr. Shelnitz is eligible to be granted securities pursuant to the Incentive Plan. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on Jan. 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Officers Disclose Acquisition of Common Stock ------------ -------------------------------------------- In separate Forms 4 filed with the U.S. Securities and Exchange Commission, these officers disclosed acquisition of shares of W.R. Grace & Co. common stock: Officers Designation Shares -------- ----------- ------ Alfred E. Festa Chairman, President 264,290 and CEO Gregory E. Poling Vice President 60,000 D. Andrew Bonham Vice President 50,000 La Force Andrew Senior Vice President 50,000 Hudson III and CFO Mark A. Shelnitz Vice President, General 35,000 Counsel and Secretary Pamela K. Wagoner Vice President & CHRO 30,000 The shares were granted to the officers at a regularly scheduled Board of Directors meeting on May 5, 2011, pursuant to 2011-2013 Long Term Incentive Compensation Program previously approved by the Bankruptcy Court. Options become exercisable in three substantially equal installments beginning on May 4, 2012; May 3, 2013; and May 5, 2014. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on Jan. 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) * Liquidity, Covenant Problems Abating on Junk Debt --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the number of junk-rated companies experiencing financial distress continues to decline, according to a May 18 report from Moody's Investors Service. Moody's said its liquidity-stress index declined in April to 4.1%, a level not seen since March 2005. The index shrank 0.3% from the month before. The index measures the percentage of junk-rated companies with the weakest liquidity. The high for the liquidity-stress index was 14.5% in October 2009. A similar decline was seen among companies under threat of violating loan covenants. Moody's covenant-stress index fell to 2.3% in April, the lowest since June 2005 when it was 1.9%. The covenant index's high was 17.3% in March 2009. * Inherited Home, IRA Remain Exempted Assets -------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that U.S. Bankruptcy Judge Cecelia Morris in Poughkeepsie, New York, came down on the side of individual bankrupts with regard to an issue that divides lower courts. In In re Cutignola, Bankr. S.D.N.Y. Case No. 10-38888, the question deals with whether property inherited from a spouse can be exempted. A husband and wife filed bankruptcy together. The wife, who owned their home in her own name, died during the bankruptcy. In addition to the house, the husband inherited her individual retirement account. Judge Morris disagreed with arguments made by the trustee and followed rulings that concluded that a properly tax-exempt IRA inherited from a deceased spouse is also exempt. * Failure to Pay Taxes Alone Doesn't Prevent Discharge ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Court of Appeals in Cincinnati ruled on May 16 that not paying taxes for almost 10 years isn't evidence by itself of a willful attempt at tax evasion. Consequently, the unpaid taxes were discharged in bankruptcy. The case U.S. v. Storey, 09-3848, U.S. 6th Circuit Court of Appeals (Cincinnati), involved an individual who filed tax returns for the years 1994 through 2005 and failed to pay any taxes for seven of the years. She filed under Chapter 7 in 2002 and received a discharge in 2004. The government sued her in U.S. District Court in 2007 alleging that taxes for the years 1997 and earlier weren't discharged. The government relied on Section 523(a)(1)(C) of the Bankruptcy Code, which says a tax debt isn't discharged when the bankrupt "willfully attempted in any manner to evade or defeat such tax." The 6th Circuit in Cincinnati overturned a ruling by the district judge. The majority opinion, written by U.S. District Judge Stephen J. Murphy, sitting by designation, said the government failed to meet its burden of proof. "Non-payment of tax alone is not sufficient to bar discharge," Judge Murphy said. At the same time, failure to pay is a "relevant consideration," he said. * Sullivan & Cromwell Settles Fee Fight With Ex-Partner ------------------------------------------------------- Evan Weinberger at Bankruptcy Law360 reports that Sullivan & Cromwell LLP has settled with an ex-partner in its suit in New York alleging he attempted to walk away with contingency fees from the bankruptcy component of a recent settlement between BDO USA LLP and Portugal-based Banco Espirito Santo International Ltd. According to Law360, Steven W. Thomas, a partner with Thomas Alexander & Forrester LLP and a former partner at Sullivan & Cromwell, said his ex-firm filed a complaint in New York state court after the settlement had been reached. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Total Share- Total Working Holders' Assets Capital Equity Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------- ------- ABSOLUTE SOFTWRE ABT CN 116.3 (12.6) (12.0) ACCO BRANDS CORP ABD US 1,094.2 293.1 (77.0) ALASKA COMM SYS ALSK US 609.8 6.3 (27.4) AMER AXLE & MFG AXL US 2,167.8 60.4 (415.4) AMR CORP AMR US 27,113.0 (1,028.0) (3,949.0) ANOORAQ RESOURCE ARQ SJ 1,024.0 20.9 (77.0) AUTOZONE INC AZO US 5,765.6 (487.0) (1,038.4) BLUEKNIGHT ENERG BKEP US 323.5 (85.8) (35.1) BOSTON PIZZA R-U BPF-U CN 148.2 1.3 (100.1) CABLEVISION SY-A CVC US 8,962.9 (309.5) (6,462.4) CC MEDIA-A CCMO US 16,938.6 1,644.2 (7,280.4) CENTENNIAL COMM CYCL US 1,480.9 (52.1) (925.9) CENVEO INC CVO US 1,439.5 208.1 (333.5) CHENIERE ENERGY CQP US 1,776.3 24.4 (547.6) CHENIERE ENERGY LNG US 2,564.4 87.4 (509.7) CHOICE HOTELS CHH US 412.4 (1.9) (49.0) CINCINNATI BELL CBB US 2,636.2 6.4 (650.4) CLEVELAND BIOLAB CBLI US 19.2 (10.1) (9.7) CLOROX CO CLX US 4,051.0 (28.0) (82.0) COLUMBIA LABORAT CBRX US 27.8 11.5 (2.6) CUMULUS MEDIA-A CMLS US 318.9 12.4 (324.4) DENNY'S CORP DENN US 296.8 (36.9) (102.3) DIRECTV-A DTV US 20,593.0 2,813.0 (678.0) DISH NETWORK-A DISH US 10,280.6 705.1 (502.5) DISH NETWORK-A EOT GR 10,280.6 705.1 (502.5) DOMINO'S PIZZA DPZ US 487.4 167.9 (1,167.7) DUN & BRADSTREET DNB US 1,825.5 (321.8) (615.8) EASTMAN KODAK EK US 5,882.0 954.0 (1,274.0) EPICEPT CORP EPCT SS 12.4 6.0 (6.0) EXELIXIS INC EXEL US 495.7 126.1 (68.7) FRIENDFINDER NET FFN US 551.9 (122.8) (105.6) GENCORP INC GY US 989.6 83.8 (177.7) GLG PARTNERS INC GLG US 400.0 156.9 (285.6) GLG PARTNERS-UTS GLG/U US 400.0 156.9 (285.6) GRAHAM PACKAGING GRM US 2,943.5 313.1 (501.5) HCA HOLDINGS INC HCA US 23,809.0 2,719.0 (7,788.0) HOVNANIAN ENT-B HOVVB US 1,670.1 1,042.4 (401.3) HUGHES TELEMATIC HUTC US 108.8 (16.0) (62.4) IDENIX PHARM IDIX US 54.9 19.6 (40.6) INCYTE CORP INCY US 459.6 315.8 (104.0) IPCS INC IPCS US 559.2 72.1 (33.0) ISTA PHARMACEUTI ISTA US 131.7 6.6 (161.7) JUST ENERGY GROU JE CN 1,760.9 (339.4) (328.6) KNOLOGY INC KNOL US 823.7 42.7 (4.0) LIN TV CORP-CL A TVL US 797.4 38.6 (127.9) LIZ CLAIBORNE LIZ US 1,255.8 (26.5) (124.5) LORILLARD INC LO US 3,590.0 1,290.0 (449.0) MAINSTREET EQUIT MEQ CN 453.0 - (10.2) MANNKIND CORP MNKD US 254.8 26.2 (203.5) MEAD JOHNSON MJN US 2,465.4 572.3 (250.4) MERITOR INC MTOR US 2,675.0 205.0 (1,006.0) MOODY'S CORP MCO US 2,524.4 498.6 (223.2) MORGANS HOTEL GR MHGC US 692.8 205.1 (29.2) NATIONAL CINEMED NCMI US 796.4 74.0 (327.0) NAVISTAR INTL NAV US 9,279.0 2,002.0 (832.0) NEXSTAR BROADC-A NXST US 582.6 40.0 (181.2) NPS PHARM INC NPSP US 158.3 117.8 (159.7) NYMOX PHARMACEUT NYMX US 10.0 6.8 (3.3) ODYSSEY MARINE OMEX US 25.7 (12.0) (8.1) OTELCO INC-IDS OTT US 319.2 22.4 (7.6) OTELCO INC-IDS OTT-U CN 319.2 22.4 (7.6) PALM INC PALM US 1,007.2 141.7 (6.2) PDL BIOPHARMA IN PDLI US 248.7 (161.6) (371.2) PLAYBOY ENTERP-A PLA/A US 165.8 (16.9) (54.4) PLAYBOY ENTERP-B PLA US 165.8 (16.9) (54.4) PRIMEDIA INC PRM US 208.0 3.6 (91.7) PROTECTION ONE PONE US 562.9 (7.6) (61.8) QUALITY DISTRIBU QLTY US 281.4 40.9 (124.4) QUANTUM CORP QTM US 431.0 97.9 (61.1) QWEST COMMUNICAT Q US 16,849.0 (2,828.0) (1,560.0) RADNET INC RDNT US 556.6 11.0 (81.8) REGAL ENTERTAI-A RGC US 2,323.2 (114.5) (541.6) RENAISSANCE LEA RLRN US 49.9 (36.6) (31.4) REVLON INC-A REV US 1,105.5 132.7 (686.5) RSC HOLDINGS INC RRR US 2,817.4 (71.6) (62.2) RURAL/METRO CORP RURL US 303.7 72.4 (92.1) SALLY BEAUTY HOL SBH US 1,707.0 418.5 (340.6) SINCLAIR BROAD-A SBGI US 1,571.2 60.4 (144.6) SINCLAIR BROAD-A SBTA GR 1,571.2 60.4 (144.6) SMART TECHNOL-A SMT US 546.2 173.7 (43.3) SMART TECHNOL-A SMA CN 546.2 173.7 (43.3) SUN COMMUNITIES SUI US 1,160.1 - (111.7) SWIFT TRANSPORTA SWFT US 2,555.7 204.6 (9.8) TAUBMAN CENTERS TCO US 2,535.6 - (512.8) TEAM HEALTH HOLD TMH US 832.2 44.8 (25.7) THERAVANCE THRX US 315.1 266.9 (27.8) TOWN SPORTS INTE CLUB US 460.0 (15.4) (4.7) UNISYS CORP UIS US 2,949.3 547.6 (692.1) UNITED RENTALS URI US 3,692.0 123.0 (29.0) US AIRWAYS GROUP LCC US 8,217.0 (104.0) (30.0) VECTOR GROUP LTD VGR US 924.6 294.8 (61.4) VENOCO INC VQ US 815.6 8.1 (21.6) VERISK ANALYTI-A VRSK US 1,286.4 (180.8) (109.1) VERSO PAPER CORP VRS US 1,458.2 169.5 (49.2) VIRGIN MOBILE-A VM US 307.4 (138.3) (244.2) VONAGE HOLDINGS VG US 251.7 (39.2) (102.0) WARNER MUSIC GRO WMG US 3,617.0 (650.0) (254.0) WEIGHT WATCHERS WTW US 1,126.0 (345.4) (636.6) WESTMORELAND COA WLB US 788.0 (1.0) (173.9) WORLD COLOR PRES WC CN 2,641.5 479.2 (1,735.9) WORLD COLOR PRES WCPSF US 2,641.5 479.2 (1,735.9) WORLD COLOR PRES WC/U CN 2,641.5 479.2 (1,735.9) ********* 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 ***