/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110708.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, July 8, 2011, Vol. 15, No. 187 Headlines 151 ST. PAUL: Voluntary Chapter 11 Case Summary 431 AMA: Voluntary Chapter 11 Case Summary AFY INC: Court Rules on Trustee's Suit v. Sears Cattle et al. AMBAC FINANCIAL: Terms of Proposed Reorganization Plan AMBAC FINANCIAL: Hearing on IRS's $807.2-Bil. Claim on July 25 AMBAC FINANCIAL: Proposes to Hire Lathrop & Clark as Counsel AMERICAN APPAREL: M. Samson and M. Thornton Resign from Board AMERICAN AXLE: May Close New York Gear-Making Plant AMTRUST FINANCIAL: FDIC Appeals Loss of $550 Million Trial BAKERS FOOTWEAR: Defers Payment of Principal Under 2007 Debenture BERNARD L MADOFF: HSBC Suit Now in Hands of District Judge Rakoff BETHLEHEM STEEL: Court Rules on Severstal's Duties Under 2003 Sale BETHLEHEM STEEL: Non-Profits' Suit v. Severstal, Mittal to Proceed BILLING SERVICES: S&P Withdraws 'B+' Corporate After Refinancing BIOLASE TECHNOLOGY: Amends License Agreement with P&G BLOCKBUSTER INC: Mediating with Canadian Unit on Trademarks BOUNDARY BAY: Court Grants CBT Relief From Automatic Stay BOWE BELL: Debtor Now Named Mail Systems Liquidation B.R. SUMMERLIN: Court to Approve Disclosure Statement B.R. SUMMERLIN: Seeks Extension of Solicitation Period to Sept. 12 BRAM, INC.: Case Summary & 8 Largest Unsecured Creditors BRIARWOOD CAPITAL: Principal Wants Chapter 11 Trustee Removed BUILDERS FIRSTSOURCE: Stadium Capital Holds 15.3% Equity Stake CAPMARK FINANCIAL: Creditors Cleared to Vote on Ch. 11 Plan CARPENTER CONTRACTORS: Taps Poyner Spruill as Litigation Counsel CAVALRY CONSTRUCTION: 2nd Cir. Affirms Ruling Against WDF Claim CENTER COURT: Taps Rocky Ortega to Handle Suit Against Montecito CLASSICSTAR LLC: Trustee Settles With Former Parent for $2 Million COLONIAL BANCGROUP: BBT Opposes Proposed Hedge Fund Lawyer CONTESSA PREMIUM: Sun Capital Tops Auction With $27-Mil. Offer CORUS BANKSHARES: Tricadia-Supported Plan Hinges on Suit v. FDIC CROATION SURF: Permitted to Use Cash Collateral in June CRUCIBLE MATERIALS: Plan Trustee Can Amend Avoidance Suit CRYSTAL CATHEDRAL: Diocese of Orange Plans to Bid for Assets CRYSTAL CATHEDRAL: Founder Will Be Non-Voting Chairman of Board DBSD N.A.: Wins Confirmation of Full-Payment Plan DELTA AIR: Minnesota Politicians Accuse Delta Of Breaking Promise DELTA AIR: Stockholders Vote 11 Members to Board of Directors DEWEY GUIDA: Cline V. Quicken Loans Remanded to State Court DEWITT REHABILITATION: Seeks Exclusivity Until Oct. 24 DLH MASTER: Taps Steve Wellington to Handle Real Estate Matters DUNE ENERGY: Well Temporarily Abandoned at 19,550 Feet FIRST INDUSTRIAL: S&P Affirms CCR at 'B+'; Outlook Positive FKF MADISON: Longview Ultra Offering Better Plan for One Madison FRANK PARSONS: Changes Name to FPI Liquidation After Sale Closing FRANK PARSONS: Gives Up Insurance Policies in Exchange for Cash GGC SOFTWARE: S&P Assigns 'B' Corporate; Outlook Stable GENCORP INC: Files Form 10-Q; Breaks Even in May 31 Quarter GENOIL INC: Posts C$1.5 Million Net Loss in Q1 2011 GOLDENPARK LLC: Taps ACT Solutions to Provide Accounting Services GOLDENPARK LLC: Levene Neale Approved as Bankruptcy Counsel GOLDENPARK LLC: HMG Approved as Double Tree Hotel Manager GRAHAM HOTEL: Voluntary Chapter 11 Case Summary GSC GROUP: Fights Lenders to Advance $235 Million Asset Sale HARRY & DAVID: Wants Plan Filing Exclusivity Until Sept. 30 HAWKS PRAIRIE: Court OKs Eclipse-Led Auction on July 29 HORIZON LINES: Extends Subscription Deadline to July 8 HOWREY LLP: Taps Protiviti Inc. as Financial Advisor INUVO(R) INC.: NYSE Amex Accepts Firm's Plan of Compliance JACK OUT OF THE BOX: Bankruptcy Judge Dismisses Chapter 11 Case JACKSON HEWITT: Has Cash Collateral Use Approval Until Aug. 6 JOSEPH DETWEILER: Court Rules on Motion to Dismiss Creditors' Suit KIEBLER RECREATION: Trustee Taps Jones Lang to Market Assets KIEBLER RECREATION: Kohrman Jackson OK'd as Counsel for Trustee LA JOLLA: Preferred Stock Holders Agree to Waive Dividends LAMBUTH UNIVERSITY: In Ch. 11, School Closed Effective June 30 LEHMAN BROTHERS: Court OKs Stipulation With LEX Over Properties LEHMAN BROTHERS: European Unit Sues First Commercial for $12-Mil. LEHMAN BROTHERS: Ex-NBA Owner Wins $2-Mil. Dispute From Collapse LEHMAN BROTHERS: To Recover up To $65-Bil. for Creditors LOS ANGELES DODGERS: Court Denies Discovery Requests on Selig MEDCLEAN TECHNOLOGIES: Hires Rosenberg Rich as New Accountants MEDICAL CONNECTIONS: Engages Grant Thornton as New Accountants MMFX CANADIAN: To Present Plan for Confirmation on July 22 MONROE CENTER: Dist. Court Tosses Akai Fine Arts' Admin. Claim MT. JORDAN: Chap. 11 Plan Features Sale of Real Estate Assets NAPA HOME: Files for Bankruptcy Amid Recall; Mulls Asset Sale NEAL QUIGLEY: Car Dealer's Debt Non-Dischargeable NORTEL NETWORKS: AAI Urges Antitrust Probe of Patent Deal NORTHERN BERKSHIRE: Wants to Hire Carl Marks as Financial Advisor NORTHERN BERKSHIRE: Taps Schwartz Hannum to Handle Labor Matters NOVEMBER 2005: Case Summary & 3 Largest Unsecured Creditors PALM HARBOR: Taps Bifferato Gentilotti as Special Counsel PERKINS & MARIE: U.S. Trustee Appoints 7-Member Creditor's Panel PERKINS & MARIE: Wants to Reject Pepsi Beverage Agreement PMI MORTGAGE: S&P Affirms 'B-' Counterparty Credit Rating POINT BLANK: Outside Directors Settling With SEC QUANTUM FUEL: E&Y Raises Going Concern Doubt; Bankruptcy Possible QUANTUM FUEL: To Sell 6,996 Common Stock Units for $2.18 Million RADIANSE INC: Dist. Court Affirms Ruling Versus' Royalty Claim RADLAX GATEWAY: Can Use Cash Collateral Until Oct. 12 RANDY WALTERS: Files for Chapter 7 Bankruptcy Protection RASER TECHNOLOGIES: Bayard P.A. Approved as Delaware Counsel RASER TECHNOLOGIES: Committee Taps Services of BDO Professionals RASER TECHNOLOGIES: Court OKs Foley & Lardner as Committee Counsel RASER TECHNOLOGIES: Court OKs Womble as Committee Co-Counsel RCC NORTH: Seeks Approval of Stipulation With Tenant RHI ENTERTAINMENT: Halmi Junior Resigns as President and CEO SATELITES MEXICANOS: Incurs $13.88 Million Net Loss in 2010 SEARS HOLDINGS: Has 'B' From Fitch Due to Declining Sales, Loss SEVEN SEAS: Dist. Ct. Doesn't See Impact of MPF Case in CIBC Suit SONJA MORGAN: On The Brink of Losing House Worth $6 Million SOUTHEASTERN MATERIALS: Court Trims Trustee's Suit v. Bank SPECIALTY PRODUCTS: Can't Share Privileged Docs, Judge Says SPRINGCREST PARTNERS: Case Summary & 8 Largest Unsecured Creditors THYSSENKRUPP BUDD: Bankruptcy Could Undercut Retiree Benefits TRIBUNE CO: Wins OK to Hire Ernst & Young as Auditor U.S. POSTAL: To Close Hundreds of Post Offices to Avoid Insolvency USA UNITED: Voluntary Chapter 11 Case Summary VINEYARD AT SERRA RETREAT: To Hire David W. Meadows as Counsel VITRO SAB: Court OKs E&Y as Tax Advisor for U.S. Units WASHINGTON MUTUAL: Wants to Expand Perkins Coie Retention WASHINGTON MUTUAL: Dime Investors Seek to Appoint Committee WASHINGTON MUTUAL: FDIC, Ex-WaMu Officers' Deal Talks Break Down WJO INC: Gets 8th Interim Order to Use Bank's Cash Collateral YULEE VENTURE: Voluntary Chapter 11 Case Summary * Commercial and Individual Bankruptcies Down in June * Hanging Paragraph Isn't Tolled by Prior Bankruptcy * Supreme Court Seeks Solicitor General View on Mortgage Case * FDIC Paves Way to Reclaim Pay From Failed Banks' Execs * Strategic Value Partners Ups Ante on European Distress Fund * BOOK REVIEW: The U.S. Healthcare Certificate of Need Sourcebook ********* 151 ST. PAUL: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: 151 St. Paul LLC 683 Middle Neck Road Great Neck, NY 11023 Tel: (516) 487-5444 Bankruptcy Case No.: 11-74760 Chapter 11 Petition Date: July 5, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Central Islip) Judge: Alan S. Trust Debtor's Counsel: James O. Guy, Esq. 49 Spice Mill Boulevard Clifton Park, NY 12065 Tel: (518) 320-7136 Fax: (518) 320-7136 E-mail: jguylaw@gmail.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Morad Yeroushalmi, managing member. 431 AMA: Voluntary Chapter 11 Case Summary ------------------------------------------ Debtor: 431 AMA LLC 24-67 46th Street Astoria, NY 11103 Bankruptcy Case No.: 11-13230 Chapter 11 Petition Date: July 5, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: David Carlebach, Esq. LAW OFFICES OF DAVID CARLEBACH, ESQ. 40 Exchange Place New York, NY 10005 Tel: (212) 785-3041 Fax: (212) 785-3618 E-mail: david@carlebachlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Mitchel M. Ozeri, managing member. AFY INC: Court Rules on Trustee's Suit v. Sears Cattle et al. ------------------------------------------------------------- Chief Bankruptcy Judge Thomas L. Saladino ruled on the adversary proceeding filed by Joseph Badami, the Chapter 7 trustee of AFY Inc., against Sears Cattle Co. (Case No. A10-4062), and against Robert A. Sears (Case No. A104-063), following a consolidated trial held in North Platte, Nebraska, on June 21, 2011. (A) Case No. A10-4062 The trustee has asserted two claims against Sears Cattle. The first claim is for a judgment in the amount of the account receivable set forth in the schedules of AFY in the amount of $291,937. In addition, the trustee seeks to collect the court sanction of $10,000 per day for the four-day delay in closing beyond June 7, 2010. In its answer, Sears Cattle raised various defenses, asserting that the court lacked subject matter jurisdiction to enter its May 14, 2010, order that the preliminary injunction does not conform to federal rules, that the preliminary injunction does not provide reasonable detail as to the acts to be performed, and that Sears Cattle did not willfully or intentionally violate the preliminary injunction. In addition, Sears Cattle filed a counterclaim asserting that by paying the proceeds of the sale of the real property, including Sears Cattle's real property, to the creditors secured by such property, the trustee has converted or wrongly misappropriated the proceeds due to Sears Cattle. Sears Cattle seeks an accounting of such proceeds and a money judgment for the amount of such proceeds. At trial, Kyle Gifford testified that as the accountant for AFY and Sears Cattle, he was aware of the basis for the account receivable due from Sears Cattle to AFY. He testified that Sears Cattle borrowed that amount from AFY as part of a stock redemption involving prior owners (other Sears family members) of Sears Cattle. The $291,937 represented the amount due from Sears Cattle to AFY on March 25, 2010, the date of bankruptcy filing. Mr. Gifford further testified that Robert and Korley Sears are the remaining owners of Sears Cattle. Further, Robert A. Sears signed the bankruptcy schedules under penalty of perjury as president of AFY, and he personally listed that account receivable on the bankruptcy schedules of AFY. When Robert A. Sears testified at trial, he did not mention or dispute the receivable. Since no evidence was presented to contradict the amount shown in the schedules and as testified to by the accountant, the Court said the trustee is entitled to judgment against Sears Cattle for $291,937. The Court also held that no evidence was presented to support the counterclaim raised by Sears Cattle against the trustee for misappropriating or wrongfully converting the proceeds of the real property sale. Accordingly, Sears Cattle's counterclaim must be dismissed. (B) Case No. A10-4063 The trustee's amended complaint against Robert A. Sears contained a first cause of action for turnover of a 2008 Toyota pickup. At trial, the trustee acknowledged that the pickup had been turned over and that the trustee was no longer pursuing any claims with respect to such pickup. The trustee's second cause of action is for collection of the court sanction in the amount of $10,000 per day for the delay in closing after June 7, 2010, until June 11, 2010. In his answer, Robert A. Sears raised the same affirmative defenses as Sears Cattle regarding a purported lack of subject matter jurisdiction to enter the May 14, 2010, order and regarding the lack of conformity of the preliminary injunction to federal rules, and lack of detail regarding the acts to be performed, and that he did not willfully or intentionally violate the injunction. Robert A. Sears further raised a counterclaim asserting his ownership interest in the truck involved in the trustee's first cause of action and asserting rights to the truck superior to that of the trustee. Accordingly, Robert A. Sears asserted that he was entitled to the auction sale proceeds of the truck. The Court held that at the trial, no evidence was presented in support of the counterclaim by Robert A. Sears regarding ownership of the truck or entitlement to the truck sale proceeds. In fact, Robert A. Sears did not even mention the truck in his testimony, and none of the documentary evidence supports any claim of ownership by Robert A. Sears in the truck. Therefore, Robert A. Sears' counterclaim regarding the truck has no factual basis and must be dismissed. A copy of Judge Saladino's July 6, 2011 Order is available at http://is.gd/dri7Vmfrom Leagle.com. About AFY Inc. Ainsworth, Nebraska-based AFY, Inc., doing business as Ainsworth Feed Yards Company, Inc., filed for Chapter 11 bankruptcy protection (Bankr. D. Neb. Case No. 10-40875) on March 25, 2010. Jerrold L. Strasheim, Esq., in Omaha, served as the Debtor's counsel. AFY estimated its assets and debts at $10 million to $50 million as of the bankruptcy filing. Affiliates Robert A. Sears and Korley B. Sears filed Chapter 11 petitions (Bankr. D. Neb. Case Nos. 10-40275 and 10-40277) on Feb. 12, 2010. Mr. Strasheim also represented the Sears Debtors. Disputes arose in the three cases as to who actually owned or controlled the voting rights of the shares of stock in AFY. The disputes were between Robert and Korley Sears on the one hand and members of the Sears family on the other hand. Partly due to this dispute over the ownership and control of AFY, on April 29, 2010, the Bankruptcy Court granted a motion to appoint a Chapter 11 trustee. Joseph H. Badami was subsequently appointed as the Chapter 11 trustee. Mr. Strasheim withdrew as attorney for AFY in June 2010. The case was converted to one under Chapter 7 on the trustee's motion. AMBAC FINANCIAL: Terms of Proposed Reorganization Plan ------------------------------------------------------ Ambac Financial Group, Inc. submitted to Judge Shelley C. Chapman of the U.S. Bankruptcy Court for the Southern District of New York its Chapter 11 Plan of Reorganization on July 6, 2011. AFG Senior Managing Director Diana Adams relates that the Plan contemplates a global settlement of certain disputes involving (1) the Debtor; (2) its operating arm Ambac Assurance Corporation; (3) an ad hoc group of senior note holders represented by Akin Gump Strauss Hauer & Feld LLP; and (4) the Office of the Commissioner of Insurance for the State of Wisconsin, in its capacity as rehabilitator of AAC's Segregated Account in the rehabilitation proceeding before the Circuit Court of Dane County, Wisconsin. Anthony Princi, Esq., at Morrison & Foerster LLP, in New York, counsel to the Official Committee of Unsecured Creditors, said the unsecured creditors agree with the most part of AFG's Chapter 11 Plan, Joel Rosenblatt of Bloomberg News reports. "It should have been filed some time ago but better late than never," Mr. Princi commented in a phone interview with Bloomberg. "We agree with the material, substantive terms. There are certain provisions that were not in full agreement but for the most part, we are supportive," Mr. Princi told Bloomberg on behalf of the Creditors' Committee. In May 2011, AFG said it found the OCI's term sheet to resolve disputes involving the Debtor and AAC "disappointing." AFG then stated that it will file a plan, with or without a deal with the OCI, on or before July 6, 2011. Plan Settlement Terms The Plan Settlement essentially provides for the Debtor to enter into a cost allocation agreement with AAC and their affiliates, other than Ambac Assurance UK Limited. The OCI is to agree to the Affiliates' entry into the allocation agreement. Specifically, under the Settlement, ACC will share 85% and the Debtor will share 15% in the fees and expenses incurred by the the Debtor relating to the "IRS Dispute." The IRS Dispute refers to (i) the adversary proceeding the Debtor commenced against the U.S. Internal Revenue Service relating to the $7.3 billion in net operating losses or NOLs; and (ii) the claims filed by the IRS in the Debtor's Chapter 11 case, including Claim Nos. 3694 and 3699. Under the Plan Settlement, the Debtor is contemplated to assume a July 18, 1991 Tax Sharing Agreement. On the Confirmation Date, the Debtor will cause its Affiliates to enter into either Amendment A, B or C to the TSA. The TSA Amendments will provide for different conditions of use of NOLs, which will be allocated as: * Any NOLs generated by AAC and other members of the AAC Subgroup as defined in the TSA occurring after the date, which is the earlier of (i) the last day of the calendar quarter preceding the Effective Date, or (ii) December 31, 2011 -- the "Determination Date" -- will be available to AAC at no cost. Such NOLs are referred to as the "Post- Determination Date NOLs." * Any NOLs generated by AAC and other members of the AAC Subgroup on or before, and existing on, the Determination Date not taking into account the consequences of any Settlement with respect to the IRS Dispute will be available for use by the AAC Subgroup. * Unless and until there has been a Deconsolidation Event, the amount of Pre-Determination Date NOLs allocated to, and available for use by, the AAC Subgroup to offset income for regular tax and alternative minimum tax purposes will be an amount equal to the "Pre-Settlement NOL Amount," minus the AAC Pro Rata Settlement Portion. The Pre-Settlement NOL Amount is defined as the lesser of: (i) $4.0 billion; and (ii) the total amount of Pre-Determination Date NOLs, minus the sum of (x) the amount of cancellation of indebtedness income within the meaning of Section 108 of the Internal Revenue, realized by the Debtor pursuant to the consummation of the Plan, and (y) the amount of interest disallowed pursuant to Section 382(l)(5)(B) of the Internal Revenue Code upon the consummation of the Plan. * A reduction in the Pre-Determination Date NOLs as a result of a settlement of the IRS Dispute before the Effective Date will be allocated as: (i) "AAC Pro Rata Settlement Portion,," which refers to the product of (i) the Pre-Effective Date Settlement Amount and (ii) the ratio of (x) $4.0 billion to (y)(i) Pre-Determination Date NOLs minus (y)(ii) Debt-Related Income. (ii) "AFG Pro Rata Settlement Portion," which refers to the Pre-Effective Date Settlement Amount reduced by the AAC Pro Rata Settlement Portion. In the event that TSA Amendment A is entered into, if a corresponding amended plan of rehabilitation with respect to the Segregated Account has not been proposed to the Rehabilitation Court by December 31, 2011, AAC will make a Cash payment to the Debtor or the Reorganized Debtor of $50,000,000. If a plan of rehabilitation has not been confirmed by the Rehabilitation Court by March 31, 2012, AAC will make an additional Cash payment to the Debtor or The Reorganized Debtor of $50,000,000. If a plan of rehabilitation has not become effective by June 30, 2012, AAC will make a Cash payment to the Debtor or the Reorganized Debtor of $100,000,000. In the event that TSA Amendment B is entered into, if the Rehabilitation Plan has not become effective, without modification, by December 31, 2011, AAC will make a Cash payment to the Debtor or the Reorganized Debtor of $200,000,000; provided that all Cash payments made by AAC will serve as a credit, without duplication, against future payments with respect to Allocated NOLs. On the Effective Date, AAC will deliver a $30,000,000 Cash Grant to the Reorganized Debtor; provided that up to $15 million of the Cash Grant will serve as a credit, without duplication, against future payments owed by AAC to the Reorganized Debtor pursuant to TSA Amendment A or TSA Amendment B. However, until the fifth anniversary of the Effective Date, if the balance of the Cash Grant at any time is $15,000,000 or less, the Reorganized Debtor will not pay Cash dividends or make any other Cash distributions to holders of New Common Stock. The Debtor and the Reorganized Debtor, as applicable, will not take any actions, which would result in the occurrence of a "Deconsolidation Event", which is defined as any event that results in neither AAC nor any entity that, pursuant to Section 381 of the Internal Revenue Code, succeeds to the tax attributes of AAC described in Section 381(b) of the Internal Revenue Code being characterized as an includible corporation with the affiliated group of corporations of which the Debtor, the Reorganized Debtor, or any successor is the common parent, all within the meaning of Section 1504 of the Internal Revenue Code. On the Effective Date, the Segregated Account will issue $350,000,000 of Junior Surplus Notes to the Reorganized Debtor. The Plan Settlement contemplates a July 29, 2011 deadline. By that date, the OCI and AAC have to elect on whether to accept or reject the terms of the Plan Settlement. If the OCI and AAC have not accepted the Plan Settlement before the settlement deadline, the Debtor may either seek to convert its Chapter 11 case to a case under Chapter 7 of the Bankruptcy Code, or cause a Deconsolidation Event to occur. Classification and Treatment of Claims The Plan designates eight classes of claims and interests in the Debtor's case and provides for the treatment of each claim class. Claim/Equity Voting Class Interest Impairment Rights ----- ------------ ---------- ------ 1 Priority Non- Unimpaired Not Entitled to Vote Tax Claims Deemed to Accept 2 Secured Unimpaired Not Entitled to Vote Claims Deemed to Accept 3 General Impaired Entitled to Vote Unsecured Claims 4 Senior Notes Impaired Entitled to Vote Claims 5 Subordinated Impaired Entitled to Vote Notes Claims 6 Section 510(b) Impaired Not Entitled to Vote Claims Deemed to Reject 7 Intercompany Impaired Not Entitled to Vote Claims Deemed to Reject 8 Equity Impaired Not Entitled to Vote Interests Deemed to Reject Holders of Allowed Class 1 Priority Non-Tax Claims will be paid in full in Cash. Holders of Allowed Class 2 Secured Claims will receive, in the Reorganized Debtor's sole discretion: (1) Cash, including the payment of any interest required to be paid pursuant to Section 506(b) of the Bankruptcy Code, in the amount equal to the Allowed Secured Claim; (2) the collateral securing the Allowed Secured Claim; or (3) any other treatment so that the Allowed Secured Claim will be Unimpaired; provided that the aggregate amount of Allowed Secured Claims will not exceed $200,000. Holders of Allowed Class 3 General Unsecured Claims will receive its Pro Rata share of (1) the New Common Stock distributed to Holders of Allowed General Unsecured Claims, Senior Notes Claims, and Subordinated Notes Claims pursuant to the Plan; and (2) the General Unsecured Warrants. Class 4 Senior Notes Claims will be allowed in the aggregate amount of $1,246,129,468. Holders of Allowed Senior Notes Claim will receive its Pro Rata share of the New Common Stock and redistributions of New Common Stock and Subordinated Notes Warrants from the Subordinated Notes Indenture Trustee in accordance with the subordination provisions of the Indentures. Class 5 Subordinated Notes Claims will be allowed in the aggregate amount of $444,182,604. Each Holder of Allowed Subordinated Notes Claim shall receive its Pro Rata share of (a) the New Common Stock; and (b) the Subordinated Notes Warrants. All Class 6 Section 510(b) Claims, Class 7 Intercompany Claims, and Class 8 Equity Interests will be terminated, cancelled, and extinguished. Each holder of those claims will not be entitled to, and will not receive or retain, any property or interest in property. The Plan also provides for the full payment of allowed Administrative and Priority Tax Claims. Other Plan Provisions All consideration necessary to make all monetary payments in accordance with the Plan will be obtained from the Cash of the Debtor or the Reorganized Debtor, as applicable, including the Cash Grant if the OCI and AAC accept the Plan Settlement prior to the Plan Settlement Deadline. The Plan also incorporates releases required by a stipulation of settlement entered by AFG and certain director defendants to resolve certain securities actions and derivative actions for $27.1 million before the U.S. District Court for the Southern District of New York. The District Court preliminary approved the stipulation of settlement. The Bankruptcy Court has yet to rule on the Stipulation of Settlement, with a hearing scheduled for July 19, 2011. A full-text copy of the July 6 Ambac Financial Plan is available for free at http://bankrupt.com/misc/Ambac_July6ReorgPlan.pdf About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor- in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed $30.05 billion in total assets, $31.47 billion in total liabilities, and a $1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of ($394.5 million) and total liabilities of $1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about $1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's bankruptcy counsel. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. AMBAC FINANCIAL: Hearing on IRS's $807.2-Bil. Claim on July 25 ------------------------------------------------------------- Bankruptcy Judge Shelley Chapman adjourned the hearing to consider Ambac Financial Group, Inc.'s objection to the Internal Revenue Service's claims from July 19, 2011, to July 25, 2011. At the hearing, Ambac Financial will ask the bankruptcy judge to disallow the U.S. Department of the Treasury - Internal Revenue Service Claim Nos. 3694 and 3699 because the Claims are substantially duplicative of one another, each asserting a priority claim against the Debtor for $807,243,827. From 1999 through 2008, Ambac Credit Products LLC, a wholly owned subsidiary of Ambac Assurance Corporation, sold credit protection to buyers in the form of credit default swap contracts. AAC insured ACP's performance under the CDS Contracts. Because ACP is disregarded for federal income tax purposes, AAC was treated as the party to the CDS Contracts. Almost all of the CDS Contracts that ACP entered into from 1999 through 2004 were substantially similar. Likewise, substantially all of the CDS Contracts that ACP entered into from 2005 through 2008 were substantially similar. AAC treated the Pre-2005 CDS Contracts as "put options" subject to the "wait and see" method of accounting for federal income tax purposes. Pursuant to this method, AAC did not realize income or expense until it disposed of a bond received from the exercise of a credit protection buyer's physical settlement right or the contract expired unexercised. AAC also continued applying the "wait and see" method of accounting with respect to its income from the payments it received with respect to the Post-2004 CDS Contracts and thus did not recognize income in either 2005 or 2006 because the contracts neither expired nor terminated. In 2007, AAC suffered significant losses in its CDS Contract portfolio for financial and statutory accounting purposes beginning in 2007. In preparing its 2007 consolidated federal income tax return, the Debtor, in consultation with its accountant KPMG LLP, determined that based upon the differences between the Pre-2005 CDS Contracts and the Post-2004 CDS Contracts, the Post-2004 CDS Contract should have been treated as notional principal contracts or NPCs rather than as put options subject to the "wait and see" method of accounting. The proposed regulations promulgated in 2004 by the Treasury Department concerning NPCs (i) require that a taxpayer use either of two methods to account for "contingent nonperiodic payments," as payments made to credit protection buyers with respect to CDS Contracts upon the occurrence of a credit event - the "noncontingent swap" method or the "mark-to-market" method; and (ii) specify that these two methods apply to NPCs entered into on or after 30 days after the proposed regulations are finalized. Because the 2004 Proposed Regulations have not been finalized in 2007 and until now, the Debtor applied the "impairment" method of accounting to these losses. The Preamble to the 2004 Proposed Regulations also provides that taxpayers that have not adopted an accounting method for NPCs providing for contingent nonperiodic payments must adopt a method that takes those payments into account over the life of the contract under a "reasonable amortization method." In April 2008, the Debtor filed with the IRS an application for change in accounting method. The application was supplemented by a letter dated September 2, 2008, that clarified that AAC had not adopted an accounting method with respect to losses incurred with respect to the Post-2004 CDS Contracts, and that AAC would adopt the impairment method of accounting with respect to any losses. The IRS has yet to formally rule on the Accounting Method Application. As a result of the application of the impairment method of accounting with respect to the losses incurred under the Post- 2004 CDS Contracts, the Debtor reported an approximately $33 million taxable loss for 2007 and $3.2 billion taxable loss for 2008. On Sept. 23, 2008, August 11, 2009, and Dec. 21, 2009, the Debtor filed claims for tentative carryback adjustments as a result of the carryback to prior taxable years of the net operating losses reflected on its 2007 and 2008 consolidated federal income tax returns. Based on these claims, in December 2008, September 2009, and February 2010, the IRS refunded to the Debtor $11,470,930, $252,704,185, and $443,940,722 in Tax Refunds, totaling $708,115,837. Pursuant to a tax sharing agreement dated July 19, 1991, among the Debtor and its subsidiaries in its consolidated tax group, as amended, the Debtor distributed the Tax Refunds to AAC. On May 5, 2011, the IRS filed its claims, which list taxes allegedly due and interest and penalties from those taxes but do not explain the basis for the claims. The IRS Claims are premised on the assumption that $708,115,837 in tax refunds paid to the Debtor between December 2008 and February 2010 on account of carrying back losses that resulted from its credit default swap contracts were erroneously paid to the Debtor. However, the Tax Refunds were not erroneously paid to the Debtor, Peter A. Ivanick, Esq., at Dewey & LeBoeuf LLP, in New York, argues. Mr. Ivanick contends that the Debtor is entitled to the Tax Refunds, and the IRS should not be entitled to assert claims in respect of those refunds, because AAC's use of the impairment method beginning in 2007 with respect to the contingent non- periodic payments under the Post-2004 CDS Contracts was the initial adoption of a proper method of accounting. "Even if AAC's use of the impairment method could somehow be considered an impermissible change in accounting method, the IRS's withholding of consent from AAC to use the impairment method should be deemed an abuse of discretion, given that the Preamble expressly disavowed the 'wait and see' method of accounting for NPCs with contingent nonperiodic payments, which AAC had been utilizing up until 2007, and the impairment method conforms with the Preamble and the IRS's prior guidance," Mr. Ivanick points out. In the alternative, even if AAC's use of the impairment method could somehow be considered improper, the IRS should be equitably estopped from challenging AAC's use of that method given the fact that the IRS never formally ruled on the Debtor's Accounting Method Application and the Debtor's 2007 consolidated federal income tax return put the IRS on notice of AAC's use of the impairment method, Mr. Ivanick maintains. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor- in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed $30.05 billion in total assets, $31.47 billion in total liabilities, and a $1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of ($394.5 million) and total liabilities of $1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about $1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's bankruptcy counsel. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. AMBAC FINANCIAL: Proposes to Hire Lathrop & Clark as Counsel ------------------------------------------------------------ Ambac Financial Group, Inc. seeks permission from the U.S. Bankruptcy Court for the Southern District of New York to employ Lathrop & Clark LLP as its special counsel, nunc pro tunc to April 4, 2011. Lathrop will represent the Debtor in Ambac Assurance Corporation's rehabilitation proceedings in the Circuit Court for Dane County, in Wisconsin. As the Debtor's special counsel, Lathrop will: (i) appear on the Debtor's behalf; (ii) draft and file legal documents; (iii) provide advice and counsel to the Debtor; (iv) perform other tasks directly related to the representation of the Debtor's interests. The Debtor will pay Lathrop's professionals according to the firm's customary hourly rates: Title Rate per Hour ----- ------------- Partners and Counsel $120 to $360 Associates $170 to $285 Paraprofessionals $50 to $175 The Debtor will also reimburse Lathrop for reasonable expenses the firm incurred or will incurred. Kenneth B. Axe, Esq., a member at Lathrop & Clark LLP, in Madison, Wisconsin -- kaxe@lathropclark.com -- discloses that his firm represents GE Capital, Liberty Mutual Insurance Company, and U.S. Bank in matters unrelated to the Debtor. Lathrop also represented The Hartford Life Insurance Company, Metropolitan Life Insurance Company and National Union Insurance Company in past matters unrelated to the Debtor, he adds. Lathrop, he cites, represented the Debtor's affiliate Ambac Assurance UK in connection with the rehabilitation of AAC, although at present it is not actively representing Ambac UK. Notwithstanding those disclosures, Mr. Axe insists that Lathrop is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor- in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed $30.05 billion in total assets, $31.47 billion in total liabilities, and a $1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of ($394.5 million) and total liabilities of $1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about $1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's bankruptcy counsel. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. AMERICAN APPAREL: M. Samson and M. Thornton Resign from Board ------------------------------------------------------------- Mark Samson and Mark Thornton resigned as members of the Board of Directors of American Apparel, Inc. The resignations of Messrs. Samson and Thornton were not due to any disagreement with the Company on any matter relating to the Company's operations, policies or practices. As disclosed on June 30, 2011, the Board appointed Marvin Igelman as a director of the Board and as a member of the Audit Committee, effective automatically upon the occurrence or creation of a future vacancy on the Board or such committee, with Mr. Igelman to serve in the same director class as such vacancy. Messrs. Samson and Thornton were both Class C directors and members of the Audit Committee, among other committees. On July 1, 2011, upon the resignations of Messrs. Samson and Thornton, Mr. Igelman was appointed to the Board as a Class C director and to the Audit Committee, to serve until the 2013 Annual Meeting of Stockholders at which such class is up for re-election and until his successor is elected and qualified, or his earlier death, resignation or removal. About American Apparel Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP) -- http://www.americanapparel.com/-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel. As of Sept. 30, 2010, American Apparel employed over 10,000 people and operated 278 retail stores in 20 countries, including the United States, Canada, Mexico, Brazil, United Kingdom, Ireland, Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea and China. American Apparel reported a net loss of $86.31 million on $532.99 million of net sales for the year ended Dec. 31, 2010, compared with net income of $1.11 million on $558.77 million of net sales during the prior year. The Company's balance sheet at March 31, 2011, showed $333.95 million in total assets, $283.12 million in total liabilities, and $50.83 million in total stockholders' equity. The Wall Street Journal reports that Skadden, Arps, Slate, Meagher & Flom has been advising the company on its recent restructuring efforts alongside investment bank Rothschild Inc. In April 2011, American Apparel said it raised $14.9 million in rescue financing from a group of investors led by Canadian financier Michael Serruya and private equity firm Delavaco Capital Corp., allowing the casual clothing retailer to meet obligations to its lenders for the time being. Going Concern Doubt Marcum LLP, in New York, in its audit report on American Apparel's financial statements for the year ended Dec. 31, 2010, expressed substantial doubt about the Company's ability to continue as a going concern. As of April 30, 2011, the Company had approximately $8,000,000 of cash, approximately $8,900,000 of availability for additional borrowings and $46,100,000 outstanding on the credit facility under the BofA Credit Agreement and $1,400,000 of availability for additional borrowings and $4,000,000 outstanding on the credit facility under the Bank of Montreal Credit Agreement. As May 10, 2011, the Company had approximately $5,941,000 available for borrowing under the BofA Credit Agreement and $1,481,000 available under the Bank of Montreal Credit Agreement. The Company incurred a loss from operations of $13,091,000 for the three months ended March 31, 2011, compared to a loss from operations of $21,556,000 for the three months ended March 31, 2010. The current operating plan indicates that losses from operations may be incurred for all of fiscal 2011. "If we are not able to timely, successfully or efficiently implement the strategies that we are pursuing to improve our operating performance and financial position, obtain alternative sources of capital or otherwise meet our liquidity needs, we may need to voluntarily seek protection under Chapter 11 of the U.S. Bankruptcy Code," the Company said following its first quarter results. AMERICAN AXLE: May Close New York Gear-Making Plant --------------------------------------------------- Jeff Bennett, writing for Dow Jones Newswires, reports that American Axle & Manufacturing Holdings Inc. may close a New York gear-making plant, where talks on a new union contract have sputtered. Dow Jones says the Cheektowaga plant, like the company's Detroit axle plant, is no longer viable since workers are paid more than $30 an hour including benefits, a level the company believes is the "market competitive" labor rate, American Axle spokesman Christopher Son said. American Axle has said it would close a Detroit axle-making facility once the current contract expires on Feb. 26. Dow Jones notes that in Detroit, no agreement was reached even as the union proposed a labor cost cut pegged to returning some work to the U.S. from Mexico. The United Auto Workers has said its pending contract talks with the Detroit Three will look to increase the auto makers' U.S. production. The UAW, which starts contract talks with General Motors Co., Ford Motor Co. and Chrysler Group LLC in two weeks, is interested in reopening mothballed plants or securing more work at existing U.S. plants. According to Dow Jones, at American Axle, the UAW said it would accept labor costs of $32 an hour including benefits, down from $45 an hour. It also said it made a last ditch offer of $30 an hour conditioned on a return of jobs from Mexico. But the company, which disputed the union's $30 an hour figure, said labor costs and a drop in demand by chief customer GM, made closing the Detroit plant a "done deal." The Cheektowaga plant employs about 100 people. The Detroit plant closing will eliminate 260 hourly and 40 salaried jobs. AMTRUST FINANCIAL: FDIC Appeals Loss of $550 Million Trial ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Federal Deposit Insurance Corp. appealed the ruling by a U.S. district judge in Cleveland in favor of AmTrust Financial Corp. The court concluded that the FDIC failed to prove there was a commitment for AmTrust to provide $550 million in capital to the bank subsidiary that subsequently failed. Had the FDIC won, its priority claim for a commitment would have come ahead of all AmTrust unsecured creditors. About AmTrust Financial AmTrust Financial Corp (PINK: AFNL) was the owner of the AmTrust Bank. AmTrust was the seventh-largest holder of deposits in South Florida, with $4.7 billion in deposits and 21 branches. In November 2008, the Office of Thrift Supervision issued a cease and desist order requiring AmTrust to improve its capital ratios. AmTrust Financial, together with affiliates that include AmTrust Management Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 09-21323) on Nov. 30, 2009. The debtor subsidiaries include AmFin Real Estate Investments, Inc., formerly AmTrust Real Estate Investments, Inc. (Case No. 09-21328). G. Christopher Meyer, Esq., Christine M. Piepont, Esq., and Sherri L. Dahl, Esq., at Squire Sanders & Dempsey (US) LLP, in Cleveland, Ohio; and Stephen D. Lerner, Esq., at Squire Sanders & Dempsey (US) LLP, in Cincinnati, Ohio, serve as counsel to the Debtors. Kurtzman Carson Consultants serves as claims and notice agent. Attorneys at Hahn Loeser & Parks LLP serve as counsel to the Official Committee of Unsecured Creditors. AmTrust Management estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. AmTrust Bank was not part of the Chapter 11 filings. On Dec. 4, 2009, AmTrust Bank was closed by regulators and the Federal Deposit Insurance Corporation was named receiver. New York Community Bank, in Westbury, New York, assumed all of the deposits of AmTrust Bank pursuant to a deal with the FDIC. BAKERS FOOTWEAR: Defers Payment of Principal Under 2007 Debenture ----------------------------------------------------------------- Bakers Footwear Group, Inc., entered into an amendment to its $4 million in aggregate principal amount of 9.5% Subordinated Convertible Debentures issued by the Company to investors on June 26, 2007. The Debenture Amendments defer payment of principal under the Debentures. Originally, all $4 million in principal amount was payable on June 30, 2012. Under the Debenture Amendments, principal will be repaid in four equal annual installments of $1 million beginning on June 30, 2012. The interest rate on the Debentures was also increased from 9.5% to 12% per annum. The Debentures continue to be nonamortizing, with interest payable semi-annually on each June 30 and December 31. The Debenture Amendments are available for free at: http://is.gd/CB9A4k The Company's Second Amended and Restated Loan and Security Agreement, as amended, required that the Company refinance the Debentures on or before May 1, 2012, to extend the maturity to a date beyond July 27, 2013. The Senior Secured Loan Agreement matures on May 28, 2013. In connection with the Debenture Amendments, the Company's senior lender, Bank of America, N.A., consented to the Debenture Amendments, subject to the terms of an amendment to that certain Senior Secured Loan Agreement, which was entered into between the Bank and the Company on June 30, 2011. The Bank's consent was also subject to the terms of an amended and restated subordination agreement in favor of the Bank entered into on June 30, 2011, among the Company, the Debenture Investors, and the Bank. The Bank Amendment and the Bank Subordination Agreement remove the Refinancing Covenant and allow the Company to make the $1 million required principal payment on June 30, 2012, provided that certain conditions are met, including that the Company maintains at least a 1.0 to 1.0 ratio of adjusted EBITDA to its interest expense for the 12 month period ending May 26, 2012, all as calculated pursuant to the Senior Secured Loan Agreement. As previously disclosed, the Company's Senior Secured Loan Agreement already requires that the Company maintain unused availability greater than 20% of the calculated borrowing base or maintain the ratio of its adjusted EBITDA to its interest expense of no less than 1.0:1.0. The minimum availability covenant is tested daily and, if not met, then the adjusted EBITDA covenant is tested on a rolling twelve month basis. The Bank Amendment and Bank Subordination Agreement are available for free at: http://is.gd/E09ay2 http://is.gd/gGsOML About Bakers Footwear St. Louis, Mo.-based Bakers Footwear Group, Inc. (OTC BB: BKRS.OB) is a national, mall-based, specialty retailer of distinctive footwear and accessories for young women. The Company's merchandise includes private label and national brand dress, casual and sport shoes, boots, sandals and accessories. The Company currently operates 231 stores nationwide. Bakers' stores focus on women between the ages of 16 and 35. Wild Pair stores offer fashion-forward footwear to both women and men between the ages of 17 and 29. The Company reported a net loss of $9.29 million on $185.62 million of net sales for the year ended Jan. 29, 2011, compared with a net loss of $9.08 million on $185.36 million of net sales for the year ended Jan. 30, 2010. The Company's balance sheet at April 30, 2011, showed $48.51 million in total assets, $56.92 million in total liabilities and a $8.41 million total shareholders' deficit. As reported by the TCR on May 6, 2011, Ernst & Young LLP, in St. Louis, Mo., expressed substantial doubt about Bakers Footwear's ability to continue as a going concern. The independent auditors noted that the Company has incurred substantial losses from operations in recent years and has a significant working capital deficiency. Bankruptcy Warning The Company noted in the Form 10-K that its ability to maintain and ultimately improve its liquidity position is highly dependent on sustaining the positive sales trends that began in June 2008 and have continued through April 2011. Comparable store sales for the last three quarters of fiscal year 2008 increased 4.7% and its comparable store sales for fiscal years 2009 and 2010 increased 1.3% and 1.7%, respectively. Through the first 12 weeks of fiscal year 2011 comparable stores sales increased 10.1%. The Company noted that net losses in recent years have negatively impacted its liquidity and financial position. As of Jan. 29, 2011, it had negative working capital of $8.7 million, unused borrowing capacity under our revolving credit facility of $3.1 million, and a shareholders' deficit of $6.0 million. The Company stated, "If positive sales trends do not continue, or if we were to incur significant unplanned cash outlays, it would become necessary for us to obtain additional sources of liquidity, or take additional cost cutting measures. Any future financing would be subject to our financial results, market conditions and the consent of our lenders. We may not be able to obtain additional financing or we may only be able to obtain such financing on terms that are substantially dilutive to our current shareholders and that may further restrict our business activities. If we cannot obtain needed financing, our operations may be materially negatively impacted and we may be forced into bankruptcy or to cease operations and you could lose your investment in the Company." BERNARD L MADOFF: HSBC Suit Now in Hands of District Judge Rakoff ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that HSBC Holdings Plc told U.S. District Judge Jed Rakoff that it's entitled to dismissal of five of 24 claims in the $9 billion lawsuit filed in bankruptcy court by the trustee liquidating Bernard L. Madoff Investment Securities Inc. Judge Rakoff ruled earlier that a district court should make threshold decisions on the five claims before sending the case back to bankruptcy court for further processing. According to Mr. Rochelle, the suit alleges that London-based HSBC "enabled" Madoff's Ponzi scheme and engaged in "financial fraud and misconduct" by being "willfully and deliberately bind to the fraud." The complaint seeks $9 billion on "theories of contribution" and $2.3 billion for receipt of fraudulent transfers. Judge Rakoff, Mr. Rochelle recounts, said in an April 25 opinion that there are "difficult questions under non-bankruptcy federal law" underpinning two issues at the foundation of five counts in the complaint. The first issue is whether the trustee has power to bring claims that initially at least belonged to customers. The second question is whether some of the trustee's claims are barred by a federal statute called the Securities Litigation Uniform Standards Act. 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. BETHLEHEM STEEL: Court Rules on Severstal's Duties Under 2003 Sale ------------------------------------------------------------------ Severstal Sparrows Point, LLC, on July 30, 2010, filed a Petition with the Maryland District Court to resolve disputes with the United States Environmental Protection Agency and the Maryland Department of Environment pursuant to the dispute resolution provisions contained within Section XX of the 1997 Consent Decree entered in the District Court in Maryland v. Bethlehem Steel Corp., No. JFM-97-558 (D. Md. filed Feb. 25, 2007). The Consent Decree detailed the environmental obligations of the Bethlehem Steel for the Sparrows Point Facility, which is now owned by Severstal. The Petition requests, inter alia, that the District Court resolve a dispute over the effect of the April 23, 2003 sale order entered by the U.S. Bankruptcy Court for the Southern District of New York on the obligations of Severstal under the 1997 Consent Decree. In a July 5, 2011 Opinion, District Judge J. Frederick Motz held that the Sale Order does limit Severstal's liability under the 1997 Consent Decree to releases of hazardous wastes and hazardous constituents occurring after April 23, 2003 only. That finding, however, does not lead the District Court to conclude -- as Severstal argues -- that Severstal necessarily is relieved of its obligation under the Consent Decree to conduct a Site Wide Investigation that includes offshore media sampling. Indeed, while arguably the scope of the SWI should be limited by virtue of the fact that Severstal is not liable for remediating toxic discharges that occurred prior to April 23, 2003, Severstal's obligation to conduct a SWI is a free-standing liability that Severstal assumed when it purchased the assets of BSC. Accordingly, the District Court will retain jurisdiction over the matter and directed the parties to submit a report within Aug. 19, stating whether they have been able to reach agreement as to the scope of the SWI that is to be conducted. Sparrows Point is located nine miles southeast of downtown Baltimore, Maryland on a 2,300 acre peninsula on the north side of the Patapsco River. BSC owned and operated the Facility from 1916 through its bankruptcy in 2003. The Facility produces hot rolled sheet, cold rolled sheet, galvanized sheet, and tin mill products. In the late 1990s, EPA and MDE brought an action against BSC for violations of the Resource Conservation and Recovery Act, 42 U.S.C. Sec. 6901 et seq., the Clean Water Act, 33 U.S.C. Sec. 1251 et seq., and corresponding state law, which the parties settled by executing a Consent Decree, entered in the District Court on October 8, 1997. The Consent Decree requires BSC to implement interim remedial measures, conduct a SWI, and then conduct a Corrective Measures Study. Additionally, the Consent Decree imposes compliance requirements related to the two on-site landfills, Coke Point and Greys Landfills. International Steel Group purchased the Facility, along with other assets, from Bethlehem pursuant to a bankruptcy sale. In April 2005, Mittal Steel acquired ISG, including its subsidiary ISG Sparrows Point, LLC, which owned the Facility. In June 2006, Mittal Steel merged with Arcelor, forming ArcelorMittal as the new parent corporation. In May 2008, ISG Sparrows Point merged with Severstal Sparrows Holding LLC, and the surviving entity was renamed Severstal Sparrows Point, LLC, which became the owner of the Facility. The case is Severstal Sparrows Point, LLC Petitioner, v. United States Environmental Protection Agency and State of Maryland Department of the Environment, Respondents, Civil No. JFM-97-558, No. JFM-97-559 (D. Md.). A copy of the Court's July 5, 2011 Opinion is available at http://is.gd/a1JkE8from Leagle.com. About Bethlehem Steel Headquartered in Bethlehem, Pennsylvania, Bethlehem Steel Corporation -- http://www.bethlehemsteel.com/-- was the second- largest integrated steelmaker in the United States, manufacturing and selling a wide variety of steel mill products including hot- rolled, cold-rolled and coated sheets, tin mill products, carbon and alloy plates, rail, specialty blooms, carbon and alloy bars and large diameter pipe. The Company filed for chapter 11 protection on Oct. 15, 2001 (Bankr. S.D.N.Y. Case No. 01-15288). Jeffrey L. Tanenbaum, Esq., and George A. Davis, Esq., at Weil, Gotshal & Manges LLP, represented the Debtors in their restructuring, the centerpiece of which was a sale of substantially all of the steelmaker's assets to International Steel Group. Bethlehem disclosed $4,266,200,000 in total assets and $4,420,000,000 in liabilities as of the bankruptcy filing. Bethlehem obtained confirmation of a chapter 11 plan on Oct. 22, 2003, which took effect on Dec. 31, 2003. BETHLEHEM STEEL: Non-Profits' Suit v. Severstal, Mittal to Proceed ------------------------------------------------------------------ District Judge J. Frederick Motz said non-profits Chesapeake Bay Foundation, Inc., and Baltimore Water Harbor Keeper, Inc., and a group of individuals can proceed with certain of their environmental liability claims against Severstal Sparrows Point LLC, a/k/a Severstal North America and ArcelorMittal USA Inc., over a site formerly owned by defunct Bethlehem Steel Corporation. International Steel Group purchased the Facility, along with other assets, from Bethlehem pursuant to a bankruptcy sale. In April 2005, Mittal Steel acquired ISG, including its subsidiary ISG Sparrows Point, LLC, which owned the Facility. In June 2006, Mittal Steel merged with Arcelor, forming ArcelorMittal as the new parent corporation. In May 2008, ISG Sparrows Point merged with Severstal Sparrows Holding LLC, and the surviving entity was renamed Severstal Sparrows Point, LLC, which became the owner of the Facility. The case is Chesapeake Bay Foundation, Inc., et al., v. Severstal Sparrows Point, LLC, et al., Civil No. JFM-10-1861 (D. Md.). A copy of Judge Motz's July 5, 2011 Opinion is available at http://is.gd/8FwakHfrom Leagle.com. About Bethlehem Steel Headquartered in Bethlehem, Pennsylvania, Bethlehem Steel Corporation -- http://www.bethlehemsteel.com/-- was the second- largest integrated steelmaker in the United States, manufacturing and selling a wide variety of steel mill products including hot- rolled, cold-rolled and coated sheets, tin mill products, carbon and alloy plates, rail, specialty blooms, carbon and alloy bars and large diameter pipe. The Company filed for chapter 11 protection on Oct. 15, 2001 (Bankr. S.D.N.Y. Case No. 01-15288). Jeffrey L. Tanenbaum, Esq., and George A. Davis, Esq., at Weil, Gotshal & Manges LLP, represented the Debtors in their restructuring, the centerpiece of which was a sale of substantially all of the steelmaker's assets to International Steel Group. Bethlehem disclosed $4,266,200,000 in total assets and $4,420,000,000 in liabilities as of the bankruptcy filing. Bethlehem obtained confirmation of a chapter 11 plan on Oct. 22, 2003, which took effect on Dec. 31, 2003. BILLING SERVICES: S&P Withdraws 'B+' Corporate After Refinancing ---------------------------------------------------------------- Standard & Poor's Ratings Services withdrew all its ratings on San Antonio-based Billing Services Group Ltd. at the company's request after BSG refinanced its outstanding senior debt with a local bank group. The withdrawal includes the 'B+' corporate credit rating, and the 'BB' issue rating on the senior term loan held at subsidiary Billing Services Group North America Inc. BIOLASE TECHNOLOGY: Amends License Agreement with P&G ----------------------------------------------------- Biolase Technology, Inc., on June 28, 2011, entered into a letter agreement amending that certain License Agreement with The Procter & Gamble Company, with an effective date of Jan. 1, 2009, which superseded that certain prior License Agreement, dated Jan. 24, 2007. The Letter Agreement amends the License Agreement so as to release certain prepaid royalty payments made by P&G to the Company in accordance with the terms and conditions of the License Agreement. About BIOLASE Technology Irvine, Calif.-based BIOLASE Technology, Inc. (NASDAQ: BLTI) -- http://www.biolase.com/-- is a dental laser company. The Company develops, manufactures and markets Waterlase technology and lasers and related products that advance the practice of dentistry and medicine. The Company reported a net loss of $12.02 million on $24.58 million of products and services revenues for the year ended Dec. 31, 2010, compared with a net loss of $2.95 million on $42.14 million of products and services revenues during the prior year. The Company's balance sheet at March 31, 2011, showed $20.30 million in total assets, $15.97 million in total liabilities, and $4.33 million in total stockholders' equity. BDO USA, LLP, raised 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 suffered recurring losses from operations, has had declining revenues and has a working capital deficit at Dec. 31, 2010. BLOCKBUSTER INC: Mediating with Canadian Unit on Trademarks ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Blockbuster Inc. and Blockbuster Canada Co. agreed in bankruptcy court to mediate the question of whether the Canadian subsidiary has the right to continue using company trademarks. The issues are further complicated because Blockbuster Canada is in bankruptcy in its home country and filed a Chapter 15 petition in New York. About Blockbuster Canada Blockbuster Canada Co., an indirect subsidiary of Blockbuster Inc., has operated video rental stores in Canada using the Blockbuster trademarks since 1990. It employs roughly 4,000 employees in more than 400 stores across 10 Canadian provinces. Blockbuster Canada's corporate head office is located in Etobicoke, Ontario. Blockbuster Canada went into receivership in Canada on May 3, 2011. Grant Thornton Limited was appointed by the Ontario Superior Court of Justice. Michael Creber, on behalf of Grant Thornton Ltd., commenced a Chapter 15 case for Blockbuster Canada (Bankr. S.D.N.Y. Case No. 11-12433) in Manhattan on May 20, 2011, to seek the U.S. court's recognition of the receivership proceedings in Canada. Robert J. Feinstein, Esq., at Pachulski Stang Ziehl & Jones LLP, serves as counsel for Grant Thornton. Blockbuster Canada is estimated to have $50 million to $100 million in assets and liabilities. About Blockbuster Inc. Blockbuster Inc., the movie rental chain with a library of more than 125,000 titles, along with 12 U.S. affiliates, initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan (Bankr. S.D.N.Y. Case No. 10-14997) on Sept. 23, 2010. It disclosed assets of $1 billion and debts of $1.4 billion at the time of the filing. Martin A. Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the U.S. Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. The Official Committee of Unsecured Creditors retained Cooley LLP as its counsel. In April 2011, Blockbuster conducted a bankruptcy court-sanctioned auction for all the assets. Dish Network Corp. won with an offer having a gross value of $320 million. BOUNDARY BAY: Court Grants CBT Relief From Automatic Stay --------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California ruled that relief from the automatic stay is granted for the limited purpose of allowing the State Court to rule on the demurrers of secured creditor California Bank & Trust to the First Amended Cross-complaints filed in the actions entitled California Bank & Trust v. Heritage-Orcas Partners, LP, et al., Orange County Superior Court case number 30-2010-00389709; California Bank & Trust v. Cartwright Properties, LLC, et al., Orange County Superior Court case number 30-2010-00379838, and California Bank & Trust v. Heritage Orcas Partners, LP, et al., Orange County Superior Court case number 30-2010-00398829, and the State Court may rule on the demurrers. About Boundary Bay Irvine, California-based Boundary Bay Capital, LLC, a California LLC, fka Covenant Bancorp, Inc., is in the business of making loans secured by real estate. The debtor owns real estate property obtained through foreclosures on real estate loans. Boundary Bay Capital filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 11-14298) on March 28, 2011. The Debtor disclosed $15,876,118 in assets and $54,448,485 in liabilities in its schedules. Affiliate Cartwright Properties, LLC, filed a separate Chapter 11 petition on June 9, 2010 (Bankr. C.D. Calif. Case No. 10-17823). BOWE BELL: Debtor Now Named Mail Systems Liquidation ---------------------------------------------------- As a result of the closing of the sale of substantially all the assets of Bowe Bell + Howell to Contrado BBH Funding, LLC, which requires the Debtors to change their corporate and company names, Judge Peter Walsh authorized that the Debtors' names be changed to: Original Name New Name ------------- -------- Bowe Systec, Inc. Mail Systems Liquidation, Inc. BBH, Inc. Mail Liquidation, Inc. Bowe Bell + Howell Company Company + Liquidation, Inc. Bowe Bell + Howell Postal Postal Liquidation, Inc. Systems Company BCC Software, Inc. Mail Software Liquidation, Inc. Bowe Bell + Howell 4461029 Canada Inc. International Ltd. About Bowe Bell Headquartered in Wheeling, Ill., BOWE BELL + HOWELL -- http://www.bowebellhowell.com/-- is a leading provider of high- performance document management solutions and services. In 1936, the company pioneered gripper arm mail-inserting systems and has one of the world's largest installed bases of such inserters as a result of the technology's flexibility, performance and reliability. The company's complete portfolio of inserting, sorting, plastic card, integrity, cutting, packaging, print-on- demand and software solutions is one of the most comprehensive product offerings for paper-based communications. These solutions are supported by one of the largest dedicated service organizations in the industry. In addition to its headquarters offices, the company maintains major manufacturing and service locations in Durham, N.C. and Bethlehem, Penn. Bowe Bell + Howell sought bankruptcy protection in the U.S. as part of a deal to itself to creditor Versa Capital Management Inc. to pay off debt. Bowe Systec, Inc., Bowe Bell + Howell Holdings, Inc., and other affiliates, including Bowe Bell + Howell Holdings, Inc., filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 11-11186) on April 18, 2011. Bowe Systec estimated assets and debt of $100 million to $500 million as of the bankruptcy filing. Lee E. Kaufman, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as the Debtors' bankruptcy counsel. McDermott Will & Emery is the Debtors' special corporate counsel. Focus Management Group is the Debtors' financial advisors. Lazard Middle Market LLC is the Debtors' investment banker. The Garden City Group, Inc is the Debtors' claims and notice agent. Bowe Bell + Howell International Ltd., BBH's Canadian subsidiary, commenced parallel ancillary proceeding under Part IV of the Companies' Creditors Arrangement Act. BBH Canada, as the proposed foreign representative for the Debtors in the ancillary proceeding, will ask an Ontario Superior Court judge to recognize the bankruptcy proceedings in the U.S. PricewaterhouseCoopers Inc. is the prospective Information Officer in the Canadian Proceeding. Versa Capital Management, Inc. on June 27 announced the completion of its previously publicized acquisition of the assets of Bowe Bell + Howell and the formation of a new company and brand, Bell and Howell, LLC. B.R. SUMMERLIN: Court to Approve Disclosure Statement ----------------------------------------------------- Judge Mike K. Nakagawa of the U.S. Bankruptcy Court for the District of Nevada found that the disclosure statement explaining B.R. Summerlin Property, L.L.C.'s second amended plan of reorganization contains adequate information within the meaning of Section 1125(a)(1) of the Bankruptcy, and will be approved subject to the Debtor submitting a completed order. The proposed Plan divides the creditors and interest holders into six classes. Class 1 consists of the secured claim of Greystone Bank, its primary creditor, that the Debtor proposes to pay in full within seven years. Class 2 consists of other secured claims and Class 3 consists of priority unsecured claims. The Debtor does not believe, however, that any claims actually exist in Class 2 or Class 3. Class 4 encompasses general unsecured claims against the Debtor which the Debtor estimates at approximately $7,205. Class 5 consists of the unsecured claim of Gibbs, Giden, Locher, Turner & Sente in the approximate amount of $47,340. Class 6 consists of the equity interest holders of the Debtor. Est. Greystone Claim Amount Reduced to $13.2-Mil Under the Second Amended Plan filed June 13, the estimated amount of claims for the Class 1 Claim was reduced to $13,200,000 from $14,200,000 in the previously filed plan. Greystone alleges that as of the Petition Date, the total amount due under the Debtor's Loan is approximately $15,292,775, consisting of the principle balance of $14,928,000, interest at the contract rate in the amount of $729,813, default interest in the amount of $364,906, late fees in the amount of $29,422, an exit fee in the amount of $149,280, plus legal and other expenses. The Debtor contends that it does not owe default interest under the Fourth Modification of the Loan Agreement, which fixed the applicable interest rate at 8% per annum. Further, the Debtor contests the late fees as improper penalties, and the exit fee, as the Debtor will enter into a new loan with Greystone pursuant to the Plan. Therefore, the Debtor believes that the allowable Greystone Claim is $14,905,072, consisting of principal in the amount of $14,298,000 and non-default interest in the amount of $607,072. The Debtor asserts that the Allowed Greystone Claim must be further reduced by payments received by Greystone both prepetition and postpetition that it has not applied to the outstanding balance. As of the anticipated date of Confirmation, the Debtor believes Greystone will hold approximately $1.7 million suspense, which must be applied against the outstanding balance, reducing the prepetition portion of Greystone's Claim to approximately $13,200,000. Because Greystone is oversecured, Greystone will also be entitled to recover postpetition interest and attorneys' fees to the extent allowed by Section 506(b) of the Bankruptcy Code. The Debtor also alleges that it has claims against Greystone because Greystone misrepresented to the Debtor that the Debtor could obtain financing from the U.S. Department of Housing and Urban Development when it was not qualified for that loan. Greystone disputes the allegations. The Debtor said it cannot predict the value of its claims against Greystone; however, the Debtor believes its damages would include and it would be entitled to recover the interest accrued on the Loan from at least December 1, 2008, through the Petition Date, which exceeds the rate of interest the Debtor would have received if it had been able to obtain HUD financing, including any default interest to which Greystone would otherwise be entitled, all late fees charged by Greystone, and the extension fees paid to Greystone. These damages are exclusive of any attorneys' fees and costs to which the Debtor may be entitled under applicable bankruptcy or non- bankruptcy law, Gregory E. Garman, Esq., at Gordon Silver, in Las Vegas, Nevada, says. 2nd Amended Plan Impairs Equity Interest Holders Class 6 Equity Interests are impaired under the Second Amended Plan. Class 6 was unimpaired under the First Amended Plan. Management & Operation of Facility Leasehold Resource Group, LLC, has up to 23 years remaining on the term of the lease to the Debtor's property, a skilled nursing facility known as The Heights of Summerlin, located at 10550 Park Run Drive, in Las Vegas, Nevada. The Debtor says it intends to assume the Lease pursuant to the Plan. As a result, upon expiration or termination of the Lease, the Debtor will continue to be obligated to return the portion of LRG's $420,000 security deposit not used or applied in accordance with the Lease. Based on the Debtor's projections, the Debtor will have sufficient cash on hand to satisfy this obligation. To the extent LRG does not exercise its option, the Lease will terminate in approximately three years. In that event, the Debtor will either (i) lease the Facility to another tenant, or (2) operate the Facility. Valuation Analysis Mr. Garman tells the Court that even if it were assumed that the Debtor would obtain a price equal to the appraised value of $15,330,000 in a liquidation, the value provided under the Plan to the Holders of Claims and Equity Interests in the Impaired Classes would be greater than they would receive in a Chapter 7 liquidation, because the sale price would be reduced by sales commissions and closing costs, any commission payable to the Chapter 7 trustee and the trustee's attorneys' and accounting fees, as well as the administrative costs of the Chapter 11 estate. Disclosure Statement has Adequate Information The Court, having reviewed and considered the Disclosure Statement, including a comparison against the original draft offered by the Debtor as plan proponent, concluded that the adequate information requirement has been met. Judge Nakagawa stated that though additional information might be included, like the basis for calculation of interest rates, the Debtor's rationale for classification of the Gibbs Giden claim, and the like, but the benefit of providing the information appears to be outweighed by its cost. The case, he noted, is not unduly complex and the information requested likely will be presented when the Debtor attempts to meet its burden of proof at plan confirmation. Moreover, no creditor, other than a well-counseled creditor having the means and incentive to obtain additional information, has objected to the adequacy of the current disclosures by the Debtor, he pointed out. Accordingly, Judge Nakagawa directed the Debtor's counsel to submit a completed order approving the Disclosure Statement in a timely fashion. He also required counsel for the Debtor and Greystone to confer as to an appropriate date or dates for the plan confirmation hearing. A full-text copy of the Second Amended Plan is available for free at http://ResearchArchives.com/t/s?7668 About B.R. Summerlin Property Woodland Hills, California-based B.R. Summerlin Property, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11-10148) on Jan. 5, 2011. The Company disclosed $23,066,151 in assets and $15,414,103 in liabilities. Affiliates B.R. Brookfield Commons No. 1, LLC (Bankr. D. Nev. Case No. 10-38835) and B.R. Brookfield Commons No. 2, LLC (Bankr. D. Nev. Case No. 10-38838) filed separate Chapter 11 petitions on Nov. 29, 2010. The Debtor disclosed $23,066,151 in assets, and $15,414,103 in debts. B.R. Summerlin Property is represented by Gregory E. Garman, Esq., -- ggarman@gordonsilver --, Gabrielle A. Hamm, Esq., -- ghamm@gordonsilver.com --, at Gordon Silver, in Los Angeles, Nevada. B.R. SUMMERLIN: Seeks Extension of Solicitation Period to Sept. 12 ------------------------------------------------------------------ B.R. Summerlin Property, LLC, asks Judge Mike K. Nakagawa of the U.S. Bankruptcy Court for the District of Nevada to extend the period to solicit acceptances of their Second Amended Plan of Reorganization through Sept. 12, 2011. The Debtor relates that the confirmation hearing has been scheduled for Sept. 12, 2011, to allow time for entry of an order approving the Disclosure Statement explaining its Plan, to comply with Rule 2002(b) of the Federal Rules of Bankruptcy Procedure, and to provide sufficient time after the Disclosure Statement Hearing for the solicitation of votes on the Plan and for parties- in-interest to review, analyze, and, if they deem appropriate, object to confirmation of the Plan. As the Debtor is expeditiously proceeding in good faith toward confirmation of its Plan, Debtor asks that the Exclusivity Period be extended through the date of the Confirmation Hearing. The Debtor's solicitation period expired on July 6. A hearing on the request is scheduled for July 20, 2011, at 9:30 a.m. About B.R. Summerlin Property Woodland Hills, California-based B.R. Summerlin Property, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11-10148) on Jan. 5, 2011. The Company disclosed $23,066,151 in assets and $15,414,103 in liabilities. Affiliates B.R. Brookfield Commons No. 1, LLC (Bankr. D. Nev. Case No. 10-38835) and B.R. Brookfield Commons No. 2, LLC (Bankr. D. Nev. Case No. 10-38838) filed separate Chapter 11 petitions on Nov. 29, 2010. The Debtor disclosed $23,066,151 in assets, and $15,414,103 in debts. B.R. Summerlin Property is represented by Gregory E. Garman, Esq., -- ggarman@gordonsilver --, Gabrielle A. Hamm, Esq., -- ghamm@gordonsilver.com --, at Gordon Silver, in Los Angeles, Nevada. BRAM, INC.: Case Summary & 8 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Bram, Inc. dba Econolodge Colonial 216 Parkway Drive Williamsburg, VA 23185 Bankruptcy Case No.: 11-51228 Chapter 11 Petition Date: July 5, 2011 Court: U.S. Bankruptcy Court Eastern District of Virginia (Newport News) Judge: Frank J. Santoro Debtor's Counsel: Karen M. Crowley, Esq. CROWLEY, LIBERATORE, & RYAN, P.C. 1435 Crossways Boulevard, Suite 300 Chesapeake, VA 23320 Tel: (757) 333-4500 Fax: (757) 333-4501 E-mail: kcrowley@clrfirm.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/vaeb11-51228.pdf The petition was signed by Ajit Patel, president. BRIARWOOD CAPITAL: Principal Wants Chapter 11 Trustee Removed ------------------------------------------------------------- Nicolas Marsch III, a principal for Briarwood Capital LLC, asks the Hon. Peter W. Bowie of the U.S. Bankruptcy Court for the Southern District of California to remove Chapter 11 Leslie T. Gladstone in bankruptcy case of Briarwood Capital LLC because she is not a disinterested party. A hearing is set for Aug. 10, 2011, at 2:00 p.m., to consider Mr. Marsch's request. Richard S. Van Dyke, Esq., at Van Dyke & Associates APLC, represents Mr. Marsch. Mr. Van Dyke asked the Court to shorten the hearing but Judge Bowie denied the request. According to Mr. Van Dyke, since trustee's appointment, additional circumstances have developed that further call into question her "disinterestedness." The Debtor's schedules were amended Jan. 27, 2011, to list a potential legal malpractice claim against the DLA Piper law firm as a result of work done by the legal team of which Trustee had been a member, thereby placing Trustee in the unenviable position of having to decide whether to pursue, or abandon, a legal malpractice claim against her former law firm and former legal team members. The Chapter 11 trustee is now before the Court on a motion to approve a sale of Debtor's interest in HCC Investors LLC to Lennar Corporation and Lennar Homes Corporation of California, Inc., and to approve a compromise of claims between Debtor and Lennar. In connection with that motion, Chapter 11 Trustee, who bears the burden of proof, is asking the Court to accept her evaluation and business judgment of the fair value of one former client HCC that she wishes to sell to another former client Lennar and the value of litigation claims between former clients, all without this Court's consideration of whatever it is that Trustee herself has considered in forming her evaluations and judgments. Mr. Van Dyke relates that, because Chapter 11 Trustee cannot be free from bias in such circumstances and her decisions necessarily carry an appearance of impropriety, the Trustee should be removed as Trustee in this matter. About Nicolas Marsch, Briarwood and Colony Based in Rancho Santa Fe, California, Briarwood Capital, LLC's primary business prepetition was land acquisition and organizing financing for real estate development. Briarwood filed for Chapter 11 bankruptcy protection on Feb. 23, 2010 (Bankr. S.D. Calif. Case No. 10-02677). In its schedules, the Debtor disclosed $292,798,759 in assets and $18,563,641 in liabilities as of the Petition Date. Colony Properties International, LLC -- Colony I -- (Bankr. S.D. Calif. Case No. 10-02937) and Colony Properties International II, LLC -- Colony II -- (Bankr. S.D. Calif. Case No. 10-03361) also filed for Chapter 11. Rancho Santa Fe, California-based Nicolas Marsch, III, filed for Chapter 11 bankruptcy protection on Feb. 25, 2010 (Bankr. S.D. Calif. Case No. 10-02939). Mr. Marsch estimated assets at $100 million to $500 million and debts at $10 million to $50 million. Mr. Marsch has a 100% membership interest in Briarwood, which he valued at over $274 million. He also has a 100% membership interest in Colony Properties. Mr. Marsch also asserts more than $2 million in claims against Briarwood and is a guarantor of debt owed by Briarwood and by to KBR Opportunity Fund II. He is also the guarantor of Colony's debt to KBR. Colony asserts more than $668,000 in claims against Mr. Marsch. Colony also asserts more than $50,000 in claims against Briarwood. The cases are separately administered. Jeffry A. Davis, Esq., at Mintz Levin Cohn Ferris Glovsky & Popeo, represents the Debtors in their restructuring efforts. In July 2010, the Court held that Mintz Levin was ineligible to represent the estates of Mr. Marsch, Briarwood and Colony Properties, or any two of them. Chapter 11 trustees have been appointed in each of the cases. Richard M. Kipperman serves as the Chapter 11 trustee for Colony Properties International, LLC and Colony Properties International II, LLC; and Leslie T. Gladstone serves as the Chapter 11 trustee for Briarwood. BUILDERS FIRSTSOURCE: Stadium Capital Holds 15.3% Equity Stake -------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Stadium Capital Management, LLC, and its affiliates disclosed that they beneficially own 14,808,890 shares of common stock of Builders Firstsource, Inc., representing 15.3% of the shares outstanding. A full-text copy of the filing is available for free at http://is.gd/EtQKXh About Builders FirstSource Headquartered in Dallas, Texas, Builders FirstSource Inc. -- http://www.bldr.com/-- supplies and manufactures building products for residential new construction. The Company operates in 9 states, principally in the southern and eastern United States, and has 55 distribution centers and 51 manufacturing facilities, many of which are located on the same premises as its distribution facilities. Builders FirstSource reported a net loss of $95.51 million on $700.34 million of sales for the year ended Dec. 31, 2010, compared with a net loss of $61.85 million on $677.88 million of sales during the prior year. The Company's balance sheet at March 31, 2011, showed $403.93 million in total assets, $264.25 million in total liabilities and $139.68 million in total stockholders' equity. * * * Builders FirstSource Inc. carries 'CCC+' issuer credit ratings, with negative outlook, from Standard & Poor's. S&P affirmed the ratings in April 2011. "The ratings affirmation reflects our belief that Builders FirstSource will likely continue to generate negative free cash flow over the upcoming year, given the ongoing weakness in new residential housing markets. While the company's liquidity position, which we currently view as adequate, is likely to somewhat improve due to the increased cash balances following the planned refinancing and the extended maturity of its revolving credit facility, it will likely continue to rely primarily on its cash balances to meet its interest and operating obligations until total housing starts improve at least 35% from 2010's level. If housing starts were to remain at its recent historically low levels, we believe the proposed refinancing would allow Builders FirstSource to fund its anticipated cash shortfall for approximately two years. The ratings also reflect what Standard & Poor's Ratings Services considers to be the company's vulnerable business profile given its significant exposure to highly cyclical new residential construction markets and its narrow end-market focus and geographic scope," S&P elaborated. In April 2011, Moody's Investors Service assigned 'Caa2' corporate family rating and probability of default ratings to Builders FirstSource. Moody's said the 'Caa2' Corporate Family Rating results from very weak operating performance due to ongoing pressures in the residential new construction end market, the primary driver of BLDR's revenues. Although some areas within BLDR's primary geographic markets of North Carolina and South Carolina may have some pockets of strength, overall, Moody's does not expect substantial improvement in new housing starts in 2011 relative to 2010. The company's products are highly price sensitive to competition and ongoing market conditions, making it difficult for it to pass on substantial price increases. It is also exposed to fluctuating costs associated with lumber, its major raw material, adding to earnings volatility. For 2010, adjusted operating margins are inadequate at negative 7.6% and free cash flow-to-debt is insufficient at negative 15.3% (adjusted per Moody's methodology). The company's inability to generate positive earnings will result in very weak credit metrics for the foreseeable future and will require cash to fund operating shortfalls. CAPMARK FINANCIAL: Creditors Cleared to Vote on Ch. 11 Plan ----------------------------------------------------------- Lance Duroni at Bankruptcy Law360 reports that U.S. Bankruptcy Judge Christopher S. Sontchi gave his blessing on Wednesday to the disclosure statement explaining Capmark Financial Group Inc.'s reorganization plan, allowing the commercial mortgage lender to put the plan to creditors for a vote. Law360 relates that Judge Sontchi overruled the lone unresolved objection to the disclosure statement - from Prairie Enterprises Ltd. - saying the landlord had requested information beyond what the document is meant to provide. Pursuant to the Plan, the reorganized company will issue $1.25 billion in notes to general unsecured creditors who are owed about $7 billion. Creditors will also be given stock in the new company and some cash. After the assets have been given out, the biggest group of creditors, those who hold unsecured loans and notes not guaranteed by collateral, will recover about $3.89 billion, or 56.1% of what they are owed, according to the plan. Capmark intends to streamline operations by eliminating its low- income housing tax credit business. The overall plan consists of 14 separate plans for each of the reorganizing entities, with Capmark's other 32 bankrupt affiliates - all special purpose entities for the LITHC business. "Any alternative to confirmation of the plan would result in significant delays, litigation, lost value and additional costs," the Company said in the disclosure statement describing the Plan. 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. CARPENTER CONTRACTORS: Taps Poyner Spruill as Litigation Counsel ---------------------------------------------------------------- Carpenter Contractors of America, Inc., and its debtor affiliates ask the U.S. Bankruptcy Court for the Southern District of Florida for permission to employ Thomas L. Ogburn, Esq. and the law firm of Poyner Spruill as special litigation counsel. The Debtor is involved in several litigation matters for the collection of unpaid services rendered, construction liens and general liability cases. As such, it is critical to the Debtor's operations and would benefit the estate to pursue the litigation and recover funds for the estate to pay creditors. The firm will be representing the Debtor in pending litigation and any new matters that arise postpetition. Mr. Ogburn tells the Court that the firm received a prepetition payment of $369, and a postpetition payment of $1,253. The firm is owed $4,869 in fees and costs for work performed. Mr. Ogburn assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: POYNER SPRUILL 301 South College street, Suite 2300 Charlotte, NC 28202 About Carpenter Contractors Pompano Beach, Florida-based Carpenter Contractors of America, Inc., dba R&D Thiel, provides carpentry services to builders of new homes primarily in Illinois and Florida. It also manufactures building components and distributes construction materials in Illinois, Florida, and North Carolina. CCA Midwest Inc. provides carpentry services to builders of new homes in Illinois. It is a wholly-owned subsidiary of Carpenter Contractors. Carpenter Contractors and CCA Midwest filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Lead Case No. 10-42604) on Oct. 25, 2010. Chad P. Pugatch, Esq., serves as the Debtors' bankruptcy counsel, and Shaw Gussis Fishman Glantz Wolfson & Towbin LLC, serve as special counsel. GlassRatner Advisory & Capital Group, LLC, led by Thomas Santoro, is the Debtors' as financial advisor, and Scott L. Spencer, CPA and Crowe Horwath, LLP is the Debtors' accountant for audit work. Carpenter Contractors disclosed $42,900,573 in assets and $25,861,652 in liabilities as of the Chapter 11 filing. The U.S. Trustee for Region 21 notified the Court that until further notice, he will not appoint a committee of creditors. CAVALRY CONSTRUCTION: 2nd Cir. Affirms Ruling Against WDF Claim --------------------------------------------------------------- WDF Inc., Federal Insurance Company, Seaboard Surety Co., jointly and severally with St. Paul Fire and Marine Insurance Co., as Seaboard's successor in interest, Fidelity and Deposit Company of Maryland appeal from a May 5, 2010 judgment of the U.S. District Court for the Southern District of New York (Karas, J.) affirming certain damage awards in an April 24, 2009 final order and judgment of the U.S. Bankruptcy Court for the Southern District of New York (Hardin, J.). Cavalry Construction Inc. worked as a masonry subcontractor to WDF on a variety of projects for the New York City School Construction Authority. In July 2007, Cavalry filed a voluntary Chapter 11 petition and continued to conduct business. In November 2007, Cavalry commenced an adversary proceeding against WDF for damages for additional work performed under the relevant contracts. WDF cross-claimed against the SCA for indemnification. Cavalry later commenced separate adversary proceedings against WDF's sureties: Federal Insurance Company, and Seaboard Surety Co., jointly and severally with St. Paul Fire and Marine Insurance Co., as Seaboard's successor in interest, Fidelity and Deposit Company of Maryland. The proceedings were consolidated. After trial, the bankruptcy court made certain determinations regarding damages owed to Cavalry and backcharges owed to WDF, and those findings were affirmed by the district court. In re Cavalry Const., Inc., 428 B.R. 25, 37-42 (S.D.N.Y. 2010). On appeal, WDF argues that the bankruptcy court erred in awarding Cavalry damages because Cavalry failed to submit sufficient proof of its alleged damages. WDF argues that the evidence submitted in support of Cavalry's claims is insufficient, as a matter of law. To establish its damages claims at trial, Cavalry submitted numerous documents labeled "Change Order Proposal." Cavalry's president, Kerry Timmons, testified that while labeled "Change Order Proposals," the documents actually referred to work already performed, not to work being proposed. The U.S. Court of Appeals for the Second Circuit held that the bankruptcy court was entitled to credit the testimony, and its finding that the proposals were prepared post-work, not pre-work, is not clearly erroneous. Moreover, under New York law, a contractor may prove its damages claim based solely on oral testimony. WDF also alleges that the courts below erred in failing to properly calculate its backcharges. To support its claim for backcharges, WDF proffered the testimony of Joseph Zerilly, its site superintendent. Mr. Zerilly testified that he compiled "daily reports," and then calculated labor costs by going through his reports, breaking down the hours required for each activity each day, adding them up and multiplying by the labor rate. He checked his daily reports against the certified payroll reports. Based on this testimony, the bankruptcy court awarded WDF $81,885.30. The bankruptcy court rejected WDF's claim for $124,014 in additional surcharges. To support the higher number, WDF submitted handwritten notations on the daily reports made some two to six months after work was complete. The bankruptcy court found the handwritten notations were not credible evidence because they were made months after the work had been completed and at a time when litigation between the parties was anticipated. The Second Circuit said it sees no reason to disturb this credibility determination by the finder of fact. The appeal is WDF, Inc., Federal Insurance Co., Seaboard Surety Co., and jointly and severally St. Paul Fire and Marine Insurance Co., as successor in interest, Fidelity and Deposit Co. of Maryland, Appellants, v. Cavalry Construction Inc., Appellees, No. 10-2028-bk (2nd Cir.). The panel consists of Circuit Judges Roger J. Miner, Joseph M. McLaughlin, and Rosemary S. Pooler. A copy of the Second Circuit's July 6, 2011 Summary Order is available at http://is.gd/mKfOrKfrom Leagle.com. About Cavalry Construction Based in Mount Vernon, New York, Cavalry Construction Inc. owns and operates a masonry company that operates primarily as a subcontractor on various public improvement construction project in the New York Metropolitan area, Westchester County and other surrounding counties. Cavalry filed a voluntary Chapter 11 petition (Bankr. S.D.N.Y. Case No. 07-22707) on July 27, 2007, represented by Arlene Gordon Oliver, Esq., at Rattet & Pasternak, L.L.P. Judge Adlai S. Hardin Jr. presides over the case. In its petition, the Debtor estimated assets and debts of $1 million to $100 million. CENTER COURT: Taps Rocky Ortega to Handle Suit Against Montecito ---------------------------------------------------------------- Center Court Partners, LLC, asks the U.S. Bankruptcy Court for the Central District of California for permission to employ Rocky Ortega, Esq. LAW OFFICES OF ROCKY ORTEGA 405 El Camino Real, Suite 320 Menlo Park, CA 94025 Tel: (408) 667-4313 Fax: (408) 521-0222 to handle the adversary proceeding related to the Chapter 11 case titled Center Court Partner, LLC vs. Montecito Bank and Trust. The Debtor will pay Mr. Ortega $150 per hour for attorney's fees. To the best of the Debtor's knowledge, Mr. Ortega is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Center Court Based in Agoura Hills, California, Center Court Partners LLC owns a commercial property located at 29501 Canwood Street, Agoura Hills, Calif. The monthly rent receipts are the Debtor's sole source of income. The Company filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 11-13715) on March 25, 2011. Judge Maureen Tighe presides over the case. Martin D. Gross, Esq., represents the Debtor as counsel. The Debtor estimated both assets and debts between $10 million and $50 million as of the Chapter 11 filing. CLASSICSTAR LLC: Trustee Settles With Former Parent for $2 Million ------------------------------------------------------------------ Ian Thoms at Bankruptcy Law360 reports that the bankruptcy trustee for ClassicStar LLC said Wednesday he had reached a $2 million settlement with the breeder's former owner, GeoStar Corp., in a tax and securities fraud case included in multidistrict litigation over a mare leasing program. James D. Lyon, the Chapter 7 trustee for ClassicStar, claimed energy company GeoStar, former ClassicStar CEO David Plummer and others drained the thoroughbred breeder dry using the company as an ATM and operating a $200 million tax fraud, Law360 says. About ClassicStar LLC Headquartered in Lexington, Kentucky, ClassicStar LLC operated as a thoroughbred horse breeder. The Company also leased horses and rents out the reproductive systems of select thoroughbred mares. The Company filed for Chapter 11 protection (Bankr. E.D. Ky. Case No.07-51786) on Sept. 14, 2007. Attorneys at Henry Watz Gardner Sellars & Gardner, PLLC, represented the Debtor while attorneys at Stites & Harbison, PLLC, represented the Creditors Committee. In its petition, the Debtor said assets totaled $227 million, comprised of account receivable from National Equine Lending Corp., and debts of $72.7 million. On April 14, 2008, the Court converted the case to a Chapter 7 liquidation, at the behest of the U.S. Trustee. James D. Lyon was appointed to serve as Chapter 7 Trustee. COLONIAL BANCGROUP: BBT Opposes Proposed Hedge Fund Lawyer ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that secured creditor Branch Banking & Trust Co. said in a court filing that Colonial BancGroup Inc. is attempting an "end run" around rulings the bankruptcy judge made while approving the Chapter 11 plan. The bank, according to the report, takes issue with Colonial's request for authority to hire the law firm Quinn Emanuel Urquhart & Sullivan LLP as special litigation counsel. Given that the firm represented hedge fund Marble Arch Investments LLC during the case, Branch Banking sees the retention as a violation of the requirement by the judge that the post-confirmation creditors' trust be independent of control by creditors. The bank, the report relates, said a "small group of bondholders" has sought to "unduly influence" Colonial to advance their goal of making a profit on their purchases of distressed debt. The bank based its objection on a ruling the bankruptcy judge made during the plan confirmation process which required that decisions for the trust be made by a trustee and not controlled by creditors. The bankruptcy judge will consider the retention of Los Angeles- based Quinn Emanuel at a July 11 hearing. 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. In June 2011, the bankruptcy judge signed a confirmation order approving Colonial BancGroup's Chapter 11 plan over objection from the Federal Deposit Insurance Corp. CONTESSA PREMIUM: Sun Capital Tops Auction With $27-Mil. Offer -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that an affiliate of Sun Capital Partners Inc. made a bid of $27 million and won the auction to buy Contessa Premium Foods Inc. The bankruptcy court in Los Angeles approved the sale on July 1. The sale included a new manufacturing facility in Commerce, California, designed to be the "world's first environmentally friendly frozen food processing center," a court filing said. Sun Capital, a Boca Raton, Florida-based private-equity investor, paid $55 million in June to buy U.S. subsidiaries of Mexican glassmaker Vitro SAB in a Chapter 11 sale. Contessa's sales fell from a peak of $221 million in 2007 to $154 million in 2010, according to court papers. Consumers are buying less expensive alternatives to privately-owned Contessa's products, the filing said. About Contessa Premium Foods San Pedro, California-based Contessa Premium Foods, Inc., fka ZB Industries, Inc., and Contessa Food Products, Inc., provides farm raised shrimp, convenience meals, stir-fry vegetables, and other frozen food products that are marketed and sold primarily in the United States and to a lesser extent in Canada, Europe, Asia, and Mexico. It divides its business into two internal groups: Contessa Seafood, which includes its seafood items, and Contessa "Green Cuisine," which includes all other fruit, vegetable and complete meal blends. Contessa Premium filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 11-13454) on Jan. 26, 2011. Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, in New York, represents the Debtor as counsel. Jeffrey N. Pomerantz, Esq., and Jeffrey W. Dulberg, Esq., at Pachulski Stang Ziehl & Jones LLP, in Los Angeles, serve as conflicts counsel for the Debtor. Scouler & Company, LLC, serves as financial advisors. Imperial Capital, LLC serves as investment banker. Holthouse Carlin & Van Trigt LLP serves as auditors and accountants. The Debtor scheduled $49,370,438 in total assets and $35,305,907 in total liabilities. The Official Committee of Unsecured Creditors in the Debtor's Chapter 11 case is represented by Arent Fox LLP. FTI Consulting Inc. serves as its financial consultants. CORUS BANKSHARES: Tricadia-Supported Plan Hinges on Suit v. FDIC ---------------------------------------------------------------- Corus Bankshares Inc. filed a proposed Chapter 11 plan last week along with an explanatory disclosure statement. The Plan is co- proposed by hedge-fund manager Tricadia Capital Management. The Plan has support from the official unsecured creditors' committee. The hearing for approval of the disclosure statement is set for July 28. If Corus can stick to the schedule, the confirmation hearing for approval of the plan would take place Sept. 9. Bill Rochelle, the bankruptcy columnist for Bloomberg News, notes that the plan puts the Federal Deposit Insurance Corp. into two classes, one for a priority claim and another for its nonpriority unsecured claim. Corus doesn't believe the FDIC will have any valid priority claim to be paid in full ahead of unsecured creditors. For its unsecured claim that could be as much as $183.4 million, the disclosure statement says the FDIC will recover between 6.2% and 53.3%. Holders of trust preferred securities, known as TOPrS, are to have a similar recovery for their $415.6 million in claims. General unsecured creditors with claims totaling between $10 million and $21 million are to have an identical dividend. Subordinated creditors and shareholders won't receive anything. The FDIC and Corus are in litigation over who owns $258 million in tax refunds. Eric Morath, writing for Dow Jones' Daily Bankruptcy Review, outlines the salient terms of the Plan: -- Unsecured creditors, primarily Tricadia and other holders of securities related to collateralized-debt obligations, or CDOs, owed a collective $415.6 million, would receive either stock in the reorganized company or a cash payment; -- The reorganized company would pursue a $257 million lawsuit against Federal Deposit Insurance Corp., the agency that became Corus Bank NA's receiver in September 2009. The lawsuit centers on whether the holding company or the FDIC should have the rights to millions of dollars in tax refunds derived from the losses tracked to the bank's failure and seizure that can be counted against years of taxes paid when the lender profited from the building boom. -- If that lawsuit is successful, it would provide funds for Corus Bankshares to restart its dormant real-estate- investment operations; and -- The minimum expected recovery for unsecured creditors is increased to 6.2% from the 4.5% they would have received under the prior liquidation plan. The larger payoff would come if Corus Bankshares succeeds in the FDIC lawsuit. That would result in unsecured creditors recovering up to 53.3 cents on the dollar. As reported by the Troubled Company Reporter on Nov. 29, 2010, Corus delivered a liquidating Chapter 11 plan that provides unsecured creditors and holders of TOPrS a recovery between 4.5% and 47.6% of the face amount of their claims. The liquidating plan proposes that on its Effective Date, all of the Debtor's assets will be transferred to and vest in New Corus. The Plan provides for the appointment of Andrew Scruton of FTI Consulting, Inc., as the Plan Administrator and U.S. Bank, N.A., Wilmington Trust Company and Wells Fargo Bank, N.A. as the members of the Plan Committee to oversee the activities of New Corus. The Plan Administrator, supervised by the Plan Committee, will be responsible for administering New Corus as set forth under the Plan, including monetizing all of New Corus' assets, resolving all Claims, pursuing all Causes of Action and distributing Net Free Cash and Residual Net Free Cash to creditors. Creditors thumbed down the liquidation proposal. Mr. Morath reports that Corus has said the new plan has support from the majority of creditors, including five major claim holders that voted last year to reject the liquidation plan. The Court will convene a hearing July 28 to consider approval of the disclosure statement explaining the plan. Earlier this year, Tricadia funds purchased Corus' trust-preferred securities with a face value of $109 million. According to Mr. Morath, the move was significant because it gave the holding company a known stakeholder with which to negotiate. Tricadia was founded by Arif Inayat and Michael Barnes. Mr. Morath says a Tricadia representative declined to comment when reached Wednesday. About Corus Bankshares Chicago, Illinois-based Corus Bankshares, Inc., is a bank holding company. Its lone operating unit, Corus Bank, N.A., was closed on September 11, 2009, by regulators, and the Federal Deposit Insurance Corporation was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with MB Financial Bank, National Association, Chicago, Illinois, to assume all of the deposits of Corus Bank. The Company sought Chapter 11 protection (Bankr. N.D. Ill. Case No. 10-26881) on June 15, 2010, disclosing $314,145,828 in assets and $532,938,418 in liabilities as of the Chapter 11 filing. Kirkland & Ellis LLP's James H.M. Sprayregen, Esq., David R. Seligman, Esq., and Jeffrey W. Gettleman, Esq., serve as the Debtor's bankruptcy counsel. Kinetic Advisors is the Company's restructuring advisor. Plante & Moran is the Company's auditor and accountant. Kilpatrick Stockton LLP's Todd Meyers, Esq., and Sameer Kapoor, Esq.; and Neal Gerber & Eisenberg LLP's Mark Berkoff, Esq., Deborah Gutfeld, Esq., and Nicholas M. Miller, Esq., represent the official committee of unsecured creditors. CROATION SURF: Permitted to Use Cash Collateral in June ------------------------------------------------------- Judge Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the Eastern District of North Carolina, Greenville Division, authorized Croation Surf Club to use cash collateral for the month of June. Specifically, the Debtor may use the Cash Collateral in a limited amount and for limited purposes during June 2011 as follows: June 2011 condominium association fees $26,000 July 2011 COA Fees 26,000 Utilities 3,500 Mediation fees 1,000 Bankruptcy Administrator's Fee 975 Hot tub cleaning and maintenance 2,200 As of the end of June 2011, the Debtor may maintain a sum of not in excess of $5,000 in its DIP Account. In addition to the permitted payment of the CC Payments, the Debtor will establish the Tax Escrow Account as a segregated DIP escrow account for the accumulation of funds to pay the 2011 Real Estate Taxes when due and deposit the sum of $20,000 into the Tax Escrow Account during May 2011 from the Cash Collateral. Royal Bank America will be granted a first priority replacement lien and security interest in all of the money deposited into the Tax Escrow Account but will not have the right to set off against the Tax Escrow Account without the prior order of the Court. No money may be paid from the Tax Escrow Account without the written consent of Royal or the order of the Court. As adequate protection for Royal's and Edwards Family Partnership LP's asserted secured interests in the Property and the Debtor's use of the Cash Collateral, the Debtor proposes that Royal and Edwards be granted postpetition liens and security interests in the same collateral, and with the same priority, as their respective prepetition liens and security interests in the Debtor's assets. To the extent that the adequate protection under the Order is insufficient, the Debtor agrees that the Secured Creditors each reserve and preserve their respective rights to assert superpriority claim under Section 507(b) of the Bankruptcy Code and to assert their respective rights to a superpriority administrative claim with priority over all costs, fees, amounts and claims under, described in or contemplated by Section 507(a)(1)(C) to the extent of and reflecting the priority of their interests in the Cash Collateral. A full-text copy of the Interim Cash Collateral Order is available for free at http://ResearchArchives.com/t/s?7669 About Croatan Surf Kill Devil Hills, North Carolina-based Croatan Surf Club, LLC, owns a 36-unit ocean-front condominium building in Dare County, North Carolina. It filed for Chapter 11 bankruptcy protection (Bankr. E.D.N.C. Case No. 11-00194) on Jan. 10, 2011. Walter L. Hinson, Esq., and Maureen Radford, at Hinson & Rhyne, P.A., in Wilson, N.C., represent the Debtor as counsel. Silverang & Donohoe LLC serves as co-counsel. No creditors committee has been formed in the case. In its schedules, the Debtor disclosed $26,151,718 in assets and $19,350,000 in liabilities. CRUCIBLE MATERIALS: Plan Trustee Can Amend Avoidance Suit --------------------------------------------------------- Bankruptcy Judge Mary F. Walrath granted the defendant's request to dismiss the lawsuit, Ronald S. Gellert, as Successor Litigation Trustee of the Crucible Materials Corporation Creditors' Litigation Trust, v. The Lenick Company, Adv. Proc. No. 10-55178 (Bankr. D. Del.), but gave the Trustee leave to amend the Complaint. On Nov. 8, 2010, the Trustee filed the adversary proceeding against Lenick to avoid transfers pursuant to 11 U.S.C. Sec. 547, to avoid fraudulent conveyances pursuant to section 548, to recover post-petition transfers pursuant to section 549, to recover property transferred pursuant to section 550, and to disallow any claims the Defendant may have pursuant to section 502. The Defendant contends that the Trustee's Complaint for recovery of a preference fails to state a claim upon which relief can be granted, because it sets forth only conclusory allegations parroting the statutory language of section 547. Judge Walrath said if the Complaint is found to be insufficient in detail, the Trustee has asked the Court for leave to amend the Complaint. The Defendant argues that the Complaint should be dismissed with prejudice but fails to articulate any argument why beyond the fact that the Complaint was insufficiently plead. Fed. R. Civ. P. 15(a) states that "leave to amend shall be freely given when justice so requires." The Trustee has previously agreed to withdraw Counts 2 and 3 of the Complaint without prejudice in exchange for the Defendant's agreement to withdraw its Motion to Dismiss those Counts. A copy of Judge Walrath's July 6, 2011 Memorandum Opinion is available at http://is.gd/Zhn4qZfrom Leagle.com. About Crucible Materials Based in Syracuse, New York, Crucible Materials Corporation -- aka Crucible Specialty Metals, Crucible Service Centers, Crucible Compaction Metals, Crucible Research and Trent Tube -- http://www.crucible.com/-- produced a wide array of steel products for manufacturers, principally in the automotive industry. After experiencing a significant drop in demand, sparked in part by the disruption in the automotive industry, the Company and its affiliate, Crucible Development Corporation, filed for Chapter 11 protection on May 6, 2009 (Bankr. D. Del. Lead Case No. 09-11582). Mark Minuti, Esq., at Saul Ewing LLP represented the Debtors in their restructuring efforts. The Debtors engaged Duff & Phelps Securities LLP as investment banker; RAS Management Advisors LLC as business advisor; and Epiq Bankruptcy Solutions LLC as claims agent. Roberta A. DeAngelis, United States Trustee for Region 3, appointed five creditors to serve on the Official Committee of Unsecured Creditors. Crucible Materials estimated assets and debts both ranging from $100 million to $500 million in its Chapter 11 petition. From four asset sales pursuant to 11 U.S.C. Sec. 363, Crucible generated $14.4 million after secured lenders were fully paid on $64.5 million in claims outstanding at the outset of the Chapter case. Under the Debtors' plan of reorganization, which was confirmed on August 26, 2010, Richard D. Caruso was appointed Litigation Trustee. CRYSTAL CATHEDRAL: Diocese of Orange Plans to Bid for Assets ------------------------------------------------------------ The Associated Press reports that the Roman Catholic Diocese of Orange said it was exploring the possibility of joining the list of potential buyers for the sprawling property that features a glass spire that can be seen from miles away in Orange County. Chapman University, which is considering building a medical school on the site, and Orange County-based real estate investment firm Greenlaw Partners LLC, have already submitted bids for the assets. The church filed a proposed Chapter 11 plan in May, to be funded by selling its property for $46 million to Greenlaw Partners. The church would lease the property back with the right to repurchase. The official committee of unsecured creditors is backing the "far superior offer" from Chapman University. The creditors are urging the bankruptcy judge to allow dueling exit plans in the megachurch's bankruptcy case. The AP says Diocese of Orange Bishop Tod D. Brown noted there is no cathedral in the county, even though it's home to 1.2 million Catholics and the nation's 11th largest diocese. The diocese is designing a cathedral for nearby Santa Ana, but the sale of property belonging to the world-famous Crystal Cathedral megachurch presents an opportunity, he said. The Crystal Cathedral aims to sell the property and lease back portions for use as a way to help erase its $36 million mortgage and wipe out almost all of the $10 million in unsecured debt that has plagued the institution for several years since a disastrous leadership transition and slump in donations. A bankruptcy court hearing has been scheduled for Tuesday to establish bidding rules for the property. About Crystal Cathedral Crystal Cathedral Ministries is a Southern California-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. Marc J. Winthrop, Esq., at Winthrop Couchot P.C. represent the Debtor. The U.S. Trustee for Region 16 appointed seven members to the official committee of unsecured creditors in the Chapter 11 case of Crystal Cathedral Ministries. Todd C. Ringstad, Esq., at Ringstad & Sanders, LLP, represent the Committee. CRYSTAL CATHEDRAL: Founder Will Be Non-Voting Chairman of Board --------------------------------------------------------------- Dan Wooding at Continental News Crystal Cathedral's founder Robert H. Schuller has not been ousted from the financially ailing megachurch's board of directors, but has been "honored" as a non- voting chairman of the board emeritus. About Crystal Cathedral Crystal Cathedral Ministries is a Southern California-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. Marc J. Winthrop, Esq., at Winthrop Couchot P.C. represent the Debtor. The U.S. Trustee for Region 16 appointed seven members to the official committee of unsecured creditors in the Chapter 11 case of Crystal Cathedral Ministries. Todd C. Ringstad, Esq., at Ringstad & Sanders, LLP, represent the Committee. DBSD N.A.: Wins Confirmation of Full-Payment Plan ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that DBSD North America Inc. won approval of a full- payment Chapter 11 plan when the bankruptcy judge in New York signed a confirmation order on July 5. All creditors were paid in full thanks to the U.S. Court of Appeals which set aside a previously confirmed plan where the company had a lower valuation. The new plan pays all creditors in full with about $280 million left over for the owner, ICO Global Communications Holdings Inc. The payment-in-full plan was the result of an auction where first- lien creditor Dish Network Corp. raised its offer from about $1 billion to $1.49 billion. Mr. Rochelle recounts that the bankruptcy judge had confirmed the prior plan over negative votes from creditor classes including Dish and Sprint-Nextel Corp. Although the appeals court upheld cramdown on Dish, cramdown on Sprint was found improper. Dish ultimately benefited from Sprint's victory because it was given another opportunity to buy DBSD. With an offer of $1.375 billion, Dish was also the successful bidder for TerreStar Networks Inc. 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. DELTA AIR: Minnesota Politicians Accuse Delta Of Breaking Promise ----------------------------------------------------------------- Political leaders in Minnesota accuse Delta Air Lines of breaking its promise of keeping jobs in the state after it took over Northwest Airlines, AirportBusiness.com reports. Delta is planning to move its training and technical jobs to Atlanta but noted that employees can keep their jobs if they relocate to Atlanta. The relocation of facilities is part of the company's cutbacks because of high fuel prices and a bad economy, Atlanta Business Journal relates. About Delta Air Lines Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- provides scheduled air transportation for passengers and cargo throughout the United States, and around the world. The Company's route network is centered on the hub system it operate at airports in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo- Narita. The hub operations include flights, which gather and distribute traffic from markets in the geographic region surrounding the hub to domestic and international cities and to other hubs. The network is supported by a fleet of aircraft, which is varied in terms of size and capabilities. On Dec. 31, 2009, the Company's wholly owned subsidiary Northwest Airlines, Inc., merged with and into Delta. The wholly owned subsidiary of the Company is Northwest Airlines Corporation. Northwest and 12 affiliates filed for Chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Stable/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. S&P said at the end of February 2011 that its ratings on Atlanta, Ga.-based Delta Air Lines Inc. reflect its highly leveraged financial profile, with significant intermediate-term debt maturities, and the risks associated with participation in the price-competitive, cyclical, and capital-intensive airline industry. The ratings also incorporate the reduced debt load and operating costs Delta achieved while in Chapter 11 in 2005-2007, and its enhanced competitive position and synergistic opportunities associated with its 2008 merger with Northwest Airlines Corp. (parent of Northwest Airlines Inc.), with the two airlines fully integrated in December 2009. S&P characterize Delta's business risk profile as weak and its financial risk profile as highly leveraged. DELTA AIR: Stockholders Vote 11 Members to Board of Directors ------------------------------------------------------------- In a Form 8-K filing with the Securities and Exchange Commission on June 30, 2011, Delta Air Lines, Inc. disclosed that the stockholders have elected these persons to serve as members of the Company's board of directors until the 2012 Annual Meeting of Stockholders: -- Richard H. Anderson; -- Edward H. Bastian; -- Roy J. Bostock; -- John S. Brinzo; -- Daniel A. Carp; -- John M. Engler; -- Mickey P. Foret; -- David R. Goode; -- Paula Rosput Reynolds; -- Kenneth C. Rogers; and -- Kenneth B. Woodrow. In addition, the stockholders approved the advisory vote on executive compensation and recommended that the frequency of future advisory votes on executive compensation be every year. Accordingly, the Board of Directors has determined that the Company will hold an advisory vote on executive compensation every year. Furthermore, the stockholders ratified the appointment of Ernst & Young LLP as the Company's independent auditors for 2011 and rejected the adoption of a stockholder proposal relating to cumulative voting for the election of directors. A copy of the SEC filing is available for free at: http://researcharchives.com/t/s?765f About Delta Air Lines Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- provides scheduled air transportation for passengers and cargo throughout the United States, and around the world. The Company's route network is centered on the hub system it operate at airports in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo- Narita. The hub operations include flights, which gather and distribute traffic from markets in the geographic region surrounding the hub to domestic and international cities and to other hubs. The network is supported by a fleet of aircraft, which is varied in terms of size and capabilities. On Dec. 31, 2009, the Company's wholly owned subsidiary Northwest Airlines, Inc., merged with and into Delta. The wholly owned subsidiary of the Company is Northwest Airlines Corporation. Northwest and 12 affiliates filed for Chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Stable/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. S&P said at the end of February 2011 that its ratings on Atlanta, Ga.-based Delta Air Lines Inc. reflect its highly leveraged financial profile, with significant intermediate-term debt maturities, and the risks associated with participation in the price-competitive, cyclical, and capital-intensive airline industry. The ratings also incorporate the reduced debt load and operating costs Delta achieved while in Chapter 11 in 2005-2007, and its enhanced competitive position and synergistic opportunities associated with its 2008 merger with Northwest Airlines Corp. (parent of Northwest Airlines Inc.), with the two airlines fully integrated in December 2009. S&P characterize Delta's business risk profile as weak and its financial risk profile as highly leveraged. DEWEY GUIDA: Cline V. Quicken Loans Remanded to State Court ----------------------------------------------------------- In the lawsuit, David Cline and Anna Cline, v. Quicken Loans Inc., Title Source Inc. d/b/a Title Source Inc. of West Virginia, Appraisals Unlimited, Incorporated, Dewey V. Guida and John Doe Note Holder, Civil Action No. 5:11CV63 (N.D. W.Va.), District Judge Frederick P. Stamp, Jr., held that mandatory abstention applies and that the civil action must be remanded to the Circuit Court of Marshall County, West Virginia. The Clines filed the complaint against the defendants in the Circuit Court of Marshall County, West Virginia, alleging various state law causes of action including unconscionability, breach of fiduciary duty, fraud or intentional misrepresentation, negligent misrepresentation, illegal loans in excess of fair market value, breach of professional standards and professional negligence, damages, joint venture, and punitive damages. Quicken Loans and Title Source removed the civil action to the District Court pursuant to 28 U.S.C. Sections 1334, 1441, and 1452. The defendants maintain that the Court has subject matter jurisdiction over the action because the case is related to the Chapter 11 bankruptcy proceedings pending against Dewey Guida. To boost their case, the Clines filed a notice of supplemental authority in which they discuss the recent Supreme Court opinion of Stern v. Marshall, ___ U.S. ___, 2011 WL 2472792 (2011). A copy of the District Court's July 5, 2011 Memorandum Opinion and Order is available at http://is.gd/vxotC9from Leagle.com. DEWITT REHABILITATION: Seeks Exclusivity Until Oct. 24 ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that DeWitt Rehabilitation & Nursing Center Inc. is requesting an extension until Oct. 24 of the exclusive right to propose a Chapter 11 plan. At a July 12 hearing, DeWitt will tell the bankruptcy judge how it's saving $65,000 month by using another pharmacy provider and $20,000 a month from outsourcing the jobs of four physical therapists. Negotiations with the union are on tap for late July, the court filing says. DeWitt explained that the creditors' committee is investigating whether there are grounds for substantive consolidation between the company that operates the nursing home and a separate company that owns the building. New York-based DeWitt Rehabilitation and Nursing Center runs a 499-bed nursing home on East 79th Street in Manhattan. The nursing home is owned by Marilyn Lichtman, who has been the operator since the facility opened in 1967. DeWitt Rehabilitation filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 11-10253) on Jan. 25, 2011. Marc A. Pergament, Esq., at Weinberg, Gross & Pergament, LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at up to $50,000 and debts at $10 million to $50 million. DLH MASTER: Taps Steve Wellington to Handle Real Estate Matters --------------------------------------------------------------- Allen Capital Partners LLC and subsidiary DLH Master Land Holding LLC ask the U.S. Bankruptcy Court for the Northern District of Texas for permission to employ Steve Wellington as special corporate and real estate counsel. Mr. Wellington will provide the Debtors with counsel, advice and expertise related to the Debtors' corporate and real estate matters. Mr. Wellington will charge for fees for services performed at a rate of $350 per hour and seek reimbursement of travel and accommodation expenses. To the best of the Debtors' knowledge, Mr. Wellington is a "disinterested person" as term is defined in Section 101(14) of the Bankruptcy Code. About Allen Capital Allen Capital Partners LLC and subsidiary DLH Master Land Holding LLC, are the developers of Dallas Logistics Hub, a 6,000-acre multimodal logistics park 12 miles (19 kilometers) from downtown Dallas. Allen Capital Partners, LLC, dba The Allen Group, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10- 30562) on Jan. 25, 2010. Mark MacDonald, Esq., at MacDonald + MacDonald, P.C., represents the Debtor. Lain, Faulkner & Co. is the Debtor's financial advisor. The Company disclosed $220,325,201 in assets and $160,622,236 in liabilities as of the Chapter 11 filing. The Debtor's affiliate -- DLH Master Land Holding, LLC, dba The Allen Group -- filed a separate Chapter 11 bankruptcy petition. Another affiliate, Visalia, California-based Richard S. Allen, Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D. Texas Case No. 10-33211) on May 3, 2010. Patrick J. Neligan, Jr., Esq., at Neligan Foley LLP, represents the Debtor. The Company disclosed $76,158,469 in assets and $53,728,982 in liabilities as of the petition date. The Debtors' proposed Reorganization Plan contemplates that the Debtors will obtain sufficient exit financing from sales and loans from insiders to enable them to pay all Administrative and non-tax Priority Claims in full on the effective date. No trustee or examiner has been appointed in any of the cases administratively consolidated with those of the Debtors. An Official Committee of Unsecured Creditors has been appointed. DUNE ENERGY: Well Temporarily Abandoned at 19,550 Feet ------------------------------------------------------ Dune Energy, Inc., announced that the ORX SL 214 #1 well at Garden Island Bay, Plaquemines Parish, Louisiana has been drilled and logged to a total depth of 19,670 feet (measured depth) and 19,550 feet (true vertical depth). The well is being temporarily abandoned and left capable for deepening or sidetracking operations at a later time. The cost of the well was approximately $32 million of which Dune had a 15% working interest. Prior to drilling the well Dune received approximately $3.9 million in cash recoupments from its partners resulting in a net cost to date of approximately $900,000. Anticipated drilling operations for the remainder of the year are detailed in the Company's July investor overview available on its Web site at www.duneenergy.com James A. Watt, President and CEO of the company stated, "Although disappointed in the results of this well to date, we are encouraged by the fact that we encountered reservoir quality rocks with hydrocarbon shows in the prospective section. We will now evaluate the data from the well and integrate it with the seismic to determine if a deepening or a side tracking operation would be warranted at a later time. We anticipate continuing our conventional lower risk drilling programs within our existing fields, including Garden Island Bay." About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company reported a net loss of $75.53 million on $64.18 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $59.13 million on $52.24 million of revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $304.31 million in total assets, $386.18 million in total liabilities, $151.64 million in redeemable convertible preferred stock, and a $233.51 million total stockholders' deficit. * * * Dune Energy carries a 'CCC-' corporate credit rating, with negative outlook, from Standard & Poor's, and 'Ca' corporate family and probability of default ratings, with negative outlook, from Moody's Investors Service. S&P said in April 2010, "[T]he company's heavy debt burden makes the prospects of a distressed exchange or bankruptcy a distinct possibility." FIRST INDUSTRIAL: S&P Affirms CCR at 'B+'; Outlook Positive ----------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook to positive from stable on First Industrial Realty Trust Inc. and First Industrial L.P. "We affirmed our 'B+' corporate credit ratings and our 'BB-' issue-level rating on the company's senior unsecured notes. We also affirmed our rating on the company's preferred stock at 'CCC+'. Our recovery rating on these notes is unchanged at '2', indicating our expectations for a substantial (70%-90%) recovery for noteholders in the event of a payment default," S&P related. "The outlook revision reflects the improvement to the company's liquidity position, which we believe is now sufficient to meet 2011 and 2012 debt maturities and enhances its ability to obtain a new credit facility by early 2012," said credit analyst George Skoufis. "We also acknowledge the company's lower leverage and stabilizing portfolio performance. Our ratings on First Industrial reflect the company's aggressive financial risk profile, which is highlighted by weak, but adequate and relatively stable fixed- charge coverage. We consider the company's liquidity, which has improved, to be adequate, although we believe it could become constrained if the company uses its current revolving credit facility capacity, as we currently assume, to fund 2011 and 2012 senior note maturities. In our view, mitigating factors include the recently improved overall leverage profile and realistic prospects for some asset disposition activity. The company's fair business risk profile acknowledges First Industrial's sizable industrial portfolio, which has good geographic and tenant diversity, and our expectation that occupancy should continue to slowly rebound." Chicago-based First Industrial, with a $3 billion real estate asset base (on an undepreciated cost basis), owns and operates 762 industrial properties with an aggregate 67.9 million sq. ft. of gross leasable space. Outlook "Our positive outlook acknowledges the improvement to the company's liquidity position, which we believe adequate to meet the company's 2011 and 2012 debt maturities and should enhance its ability to obtain a new credit facility well in advance of its current facility's late 2012 maturity. We also acknowledge the company's lower leverage and stabilizing portfolio performance, which should support gradual improvement in still weak FCC measures. We could raise the corporate credit rating if the company is successful in obtaining a new credit facility that enhances its overall liquidity and extends the maturity beyond the current 2012 expiration, and if we believe FCC is poised to improve to the high 1x area. Given the previously noted balance sheet and liquidity improvements, we currently do not foresee taking any negative rating actions in the near term," S&P stated. FKF MADISON: Longview Ultra Offering Better Plan for One Madison ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that One Madison Park has an offer from the new owner of the secured debt that's $58 million better than the proposal from a joint venture between CIM Fund III LP and HFZ Capital Group LLC that the lender values at $162 million. Before bankruptcy, the $235 million first lien was held by iStar Financial Inc., according to the creditors' committee. Mr. Rochelle relates that the debt was sold to the trustee for the junior lender, Longview Ultra Construction Loan Fund, court papers say. Now holding all the senior debt, the lender said in papers filed in bankruptcy court in Delaware on July 1 that the $162 million price was "contrived" and had "no relationship to the value of the property." The lender says it offered a binding commitment for a plan worth $220 million that would have "increased recoveries to unsecured creditors," the lender's court papers say. The lender, according to the report, requested that a currently scheduled July 28 hearing for approval of the disclosure statement be adjourned to avoid a fight over a plan the lender believes can't be approved. The early days of the case were consumed in a dispute over control. Once resolved, the plan was filed. FKF Madison owns the One Madison Park condominium tower in New York City. One Madison Park project came to halt in February 2010 when iStar Financial Inc., the chief financier for the project, moved to foreclose on it. The high-profile condominium project, a 50-story tower was developed by Ira Shapiro and Marc Jacobs. An involuntary Chapter 7 case (Bankr. D. Del. Case No. 10-11867) was filed against FKF Madison on June 8, 2010. The case was converted to a case under Chapter 11 in November 2010. FRANK PARSONS: Changes Name to FPI Liquidation After Sale Closing ----------------------------------------------------------------- Frank Parsons, Inc., changed its name to "FPI Liquidation Corp." after closing of the sale of substantially all of its assets to TSRC, Inc., in May. Judge Robert A. Gordon of the U.S. Bankruptcy Court for the District of Maryland, Baltimore Division, approved the sale to TSRC, free and clear of all liens. Pursuant to an asset purchase agreement, the Buyer paid $2,000,000, plus 50 % of the book value of the Closing Inventory, for the purchased assets. The transfer of the Purchased Assets to the Buyer free and clear of all Liens will not result in any prejudice to any holders of any Liens, as (i) all net cash proceeds of the Sale other than the proceeds allocated for Anne Arundel Economic Development Corporation will be remitted to Wells Fargo Bank, N.A., as agent for a group of lenders, for application to the Debtor's DIP Financing obligations, and (ii) the only other Lienholder, AAEDC, will have its interest protected by payment of the AAEDC Proceeds, promptly after closing. The Debtor will paid to AAEDC, in full satisfaction of AAEDC's secured claim, the portion of the net cash proceeds of the Sale in an amount equal to $86,000. AAEDC will retain a general unsecured claim against the Debtor for the unpaid balance of AAEDC's claim. Michael Eaton, the Pension Benefit Guaranty Corporation, and AAEDC objected to the sale. The Eaton Objection and the PBGC Objection were withdrawn prior to the sale hearing. The AAEDC Objection has been resolved by agreement, and based on this, was withdrawn prior to the sale hearing. The Debtor changed its name to a name that does not include any name or mark included in the Intellectual Property or any translations, adaptations, derivations or combinations of that name or mark confusingly similar thereto; provided, however, following the Closing, the Debtor is authorized to include the Purchased Name solely for reference as "f/k/a" in any filings or other correspondence with the Court. About Frank Parsons Headquartered in Hanover, Maryland, Frank Parsons, Inc. -- http://www.frankparsons.com/-- aka Frank Parsons Paper Company Inc., was the largest employee-owned, business products, technology, and office supplies company in the United States, offering more than 180,000 products from companies such as Avery, Fujifilm, Hewlett Packard, IBM, Sony, Xerox, Xiotech, and more. Frank Parsons is an approved contractor on the GSA Schedule and an authorized AbilityOne Distributor. The company holds several environmental certifications, including FSC, SFI, and PEFC. Frank Parsons filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case No. 11-10338) on Jan. 6, 2011. The Debtor estimated its assets and debts at $10 million to $50 million. Gary H. Leibowitz, Esq., and Irving Edward Walker, Esq., at Cole Schotz Meisel Forman & Leonard, PA, serve as the Debtor's bankruptcy counsel. The Debtor has also tapped SSG Capital as an investment banker to explore strategic options. WeinsweigAdvisors LLC is the financial advisor to the Debtor. Delaware Claims Agency, LLC, is the claims and noticing agent. Brent C. Strickland, Esq., at Whiteford, Taylor & Preston L.L.P., in Baltimore, Maryland, and Bradford J. Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as counsel to the Official Committee of Unsecured Creditors formed in the Chapter 11 case. Substantially all of Frank Parson's assets were sold to TSRC, Inc. Frank Parson is now known as FPI Liquidation Corp. FRANK PARSONS: Gives Up Insurance Policies in Exchange for Cash --------------------------------------------------------------- FPI Liquidation Corp., formerly known as Frank Parsons, Inc., seeks authority from the U.S. Bankruptcy Court for the District of Maryland, Baltimore Division, to: (1) sell its interest in the Donald A. Rea Life insurance policy issued by New York Life Insurance and Annuity Corporation and held in the J. Wentworth Printing Life Insurance Trust, to Clifford Paper, Inc.; and (2) surrender certain other life insurance policies issued by Massachusetts Mutual Life Insurance Company in exchange for their cash surrender value. MassMutual has advised the Debtor that the total cash surrender value of the policies is currently $246,027 as of June 24, 2011. New York Life has advised the Debtor that the total cash surrender value of the Don Rea Policy currently is $159,528 as of May 16, 2011. The Debtor has agreed to sell its interest in the Trust and Don Rea Policy to Clifford, who already owns a beneficial interest in the Trust, for $79,016, pursuant to the terms and conditions set forth in a sale agreement. The sale price, the Debtor says, is equal to its percentage ownership interest in the current cash surrender value of the Don Rea Policy. Gary H. Leibowitz, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Baltimore, Maryland -- gleibowitz@coleschotz.com -- says there is no existing market for the Don Rea Policy outside of the current ownership group due primarily to its multi-party ownership. Mr. Leibowitz relates that the Debtor's DIP financing with Wells Fargo, N.A., has been paid off and the credit facility has been terminated. The Debtor, he adds, is in the process of converting all of the assets of the estate to cash to fund its anticipated Chapter 11 plan of liquidation, and to make distributions for the benefit of creditors. By surrendering the MassMutual Policies and selling its interest in the Don Rea Policy, the estate will generate additional and necessary funds in exchange for assets for which there is no existing market, Mr. Leibowitz tells the Court. Furthermore, the Debtor has determined that the proposed cash surrender value for the MassMutual Policies, and the purchase price for its interest in the Don Rea Policy, fall within the range of reasonableness and are in the best interest of creditors and the estate, he adds. The combined estimated proceeds of $325,044 to be realized by the Debtor's estate provides ample grounds for approval of the sale and surrender of the insurance policies under Section 363 of the Bankruptcy Code, Mr. Leibowitz says. About Frank Parsons Headquartered in Hanover, Maryland, Frank Parsons, Inc. -- http://www.frankparsons.com/-- aka Frank Parsons Paper Company Inc., was the largest employee-owned, business products, technology, and office supplies company in the United States, offering more than 180,000 products from companies such as Avery, Fujifilm, Hewlett Packard, IBM, Sony, Xerox, Xiotech, and more. Frank Parsons is an approved contractor on the GSA Schedule and an authorized AbilityOne Distributor. The company holds several environmental certifications, including FSC, SFI, and PEFC. Frank Parsons filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case No. 11-10338) on Jan. 6, 2011. The Debtor estimated its assets and debts at $10 million to $50 million. Gary H. Leibowitz, Esq., and Irving Edward Walker, Esq., at Cole Schotz Meisel Forman & Leonard, PA, serve as the Debtor's bankruptcy counsel. The Debtor has also tapped SSG Capital as an investment banker to explore strategic options. WeinsweigAdvisors LLC is the financial advisor to the Debtor. Delaware Claims Agency, LLC, is the claims and noticing agent. Brent C. Strickland, Esq., at Whiteford, Taylor & Preston L.L.P., in Baltimore, Maryland, and Bradford J. Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as counsel to the Official Committee of Unsecured Creditors formed in the Chapter 11 case. Substantially all of Frank Parson's assets were sold to TSRC, Inc. Frank Parson is now known as FPI Liquidation Corp. GGC SOFTWARE: S&P Assigns 'B' Corporate; Outlook Stable ------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Wilmington, Del.-based software and service provider GGC Software Holdings LLC. Its subsidiaries, Lawson Software Inc. and SoftBrands Inc., are co-borrowers. The outlook is stable. "At the same time, we assigned a 'B+' issue-level rating and '2' recovery rating to the company's $1.04 billion first-lien credit facilities and a 'B-' rating and '5' recovery rating to its $560 million senior unsecured notes," S&P related. GGC Software intends to use the newly issued debt, along with approximately $560 million of new sponsor equity from Golden Gate Capital, to purchase the company and to refinance existing debt. "Our ratings on GGC Software Holdings reflect the company's highly leveraged capital structure, with pro forma debt to EBITDA in the 7x area," said Standard & Poor's credit analyst Philip Schrank, "and declining to the mid-6x area as the company realizes cost- saving synergies over the coming year." Its recurring revenue base, positive cash flows through the recent downturn, and recognized product strength somewhat offset this factor. GENCORP INC: Files Form 10-Q; Breaks Even in May 31 Quarter ----------------------------------------------------------- GenCorp Inc. filed with the U.S. Securities and Exchange Commission its Quarterly Report on Form 10-Q reporting $0 net income (break even) on $229.90 million of net sales for the three months ended May 31, 2011, compared with net income of $13.50 million on $234.10 million of net sales for the same period during the prior year. The Company also reported net income of $1.20 million on $439.70 million of net sales for the six months ended May 31, 2011, compared with net income of $4.60 million on $420.90 million of net sales for the same period a year ago. The Company's balance sheet at May 31, 2011, showed $987.30 million in total assets, $1.14 billion in total liabilities, $4.70 million in redeemable common stock and a $165.80 million total shareholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/x0O6la About GenCorp Inc. Rancho Cordova, Calif.-based GenCorp Inc. (NYSE: GY) -- http://www.GenCorp.com/-- is a manufacturer of aerospace and defense products and systems with a real estate segment that includes activities related to the re-zoning, entitlement, sale, and leasing of the Company's excess real estate assets. * * * Standard & Poor's in February 2011 has raised its corporate credit rating on GenCorp Inc. to 'B' from 'B-'. S&P also raised its rating on the company's first-lien secured debt to 'BB-' from 'B+' and on the subordinated debt to 'CCC+' from 'CCC'. The recovery rating on the first-lien secured debt remains unchanged at '1', and the recovery rating on the subordinated debt remains unchanged at '6'. The outlook is stable. "We are raising its ratings on GenCorp by one notch to reflect the company's improved liquidity position," said Standard & Poor's credit analyst Lisa Jenkins. "The ratings on GenCorp reflect its highly leveraged capital structure, weak financial performance, limited diversity, and modest scale of operations compared with competitors. Offsetting these challenges to some extent is the company's good niche positions in aerospace propulsion and solid backlog. S&P characterize GenCorp Inc.'s business profile as weak and its financial profile as highly leveraged." As reported by the TCR on May 24, 2011, Moody's Investors Service upgraded the corporate family and probability of default ratings of GenCorp Inc. to B1 from B2. 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. GENOIL INC: Posts C$1.5 Million Net Loss in Q1 2011 --------------------------------------------------- Genoil Inc. filed on July 5, 2011, its interim consolidated financial statements for the three months ended March 31, 2011. The Company incurred a net loss of C$1.5 million for the three months ended March 31, 2011, compared with a net loss of C$1.7 million for the same period of 2010. The Company has not generated revenues from its technologies to date and has funded its near term operations by way of capital stock private placements and short-term loans. The Company's balance sheet at March 31, 2011, showed C$5.4 million in total assets, C$2.7 million in total liabilities, and stockholders' equity of C$2.7 million. A copy of the Company's interim consolidated financial statements for the three months ended March 31, 2011, is available at: http://is.gd/BLPjf9 A copy of the Management's Discussion and Analysis of the Company's interim consolidated financial statements for the three months ended March 31, 2011, is available at http://is.gd/Oz6VLV About Genoil Inc. Genoil Inc. is a technology development company based in Alberta, Canada. The Company specializes in heavy oil upgrading, oily water separation, process system optimization, development, engineering, design and equipment supply, installation, start up and commissioning of services to specific oil production, refining, marine and related markets. The Company's securities trade on both the TSX Venture Exchange (Symbol: GNO) and the NASDAQ OTC Bulletin Board (Symbol: GNOLF). GOLDENPARK LLC: Taps ACT Solutions to Provide Accounting Services ----------------------------------------------------------------- Goldenpark LLC asks the U.S. Bankruptcy Court for the Central District of California for permission to employ ACT Solutions as accountant. The Debtor requires the expertise of an accountant to provide assistance in connection with the case, particularly since the Debtor has no accounting personnel in-house. ACT has provided outsourced accounting services to the hospitality industry since 1989. ACT will, among other things: -- prepare the hotel's general ledger, financial statements and reconciliations of all bank accountants; -- maintain perpetual files for all balance sheet accounts; -- maintain the hotel's trade accounts payable, including voucher invoices to the general ledger and trade payables, open vendor filed, prepare weekly and as required check batches, prepare monthly and upon request item listing of trade payables balanced to the general ledger, prepare a monthly check register of checks written and provide a monthly updated vendor master list. The Debtor proposes to pay ACT a fixed monthly fee of $2,000. Kenneth A. Wolski, president of ACT, assures the Court that ACT is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Goldenpark LLC Goldenpark LLC operates a 171-room hotel in Norwalk, California. Pursuant to a franchise agreement with Hilton Worldwide, the hotel is currently being operated as a Double Tree Hotel. Goldenpark LLC filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-30070) on May 8, 2011, to halt a secured lender's attempt to place the hotel in the hands of a receiver. Judge Peter Carroll presides over the case. The Debtor estimated $10 million to $50 million in both assets and debts as of the Chapter 11 filing. GOLDENPARK LLC: Levene Neale Approved as Bankruptcy Counsel ----------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California authorized Goldenpark LLC to employ Levene, Neale, Bender, Yoo & Brill LLP as its bankruptcy counsel. As reported in the Troubled Company Reporter on June 15, 2011, the hourly rates of the firm's personnel are: Attorneys Hourly Rates --------- ------------ David W. Levene, Esq. $595 David L. Neale, Esq. $595 Ron Bender, Esq. $595 Martin J. Brill, Esq. $595 Timothy J. Yoo. Esq. $595 Edward M. Wolkowitz, Esq. $595 David B. Golubchik, Esq. $575 Monica Y. Kim., Esq. $550 Beth Ann R. Young, Esq. $550 Daniel H. Reiss, Esq. $550 Irving M. Gross, Esq. $550 Philip A. Gasteier, Esq. $550 Jacqueline L. James, Esq. $495 Juliet Y. Oh, Esq. $495 Michelle S. Grimberg, Esq. $495 Todd M. Arnold, Esq. $495 Anthony A. Friedman, Esq. $435 Carmela T. Pagay, Esq. $435 Krikor J. Meshefejian, Esq. $375 John Patrick M. Fritz, Esq. $375 Gwendolen D. Long, Esq. $375 Lindsey L. Smith, Esq. $275 Paraprofessionals $195 The Debtor assured the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached at: Timothy J. Yoo, Esq. David B. Golubchik, Esq. Lindsey L. Smith, Esq. LEVENE, NEALE, BENDER, YOO & BRILL L.L.P. 10250 Constellation Boulevard, Suite 1700 Los Angeles, CA 90067 Tel: (310) 229-1234 Fax: (310) 229-1244 E-mail: tjy@lnbyb.com dbg@lnbyb.com lls@lnbyb.com About Goldenpark LLC Goldenpark LLC operates a 171-room hotel in Norwalk, California. Pursuant to a franchise agreement with Hilton Worldwide, the hotel is currently being operated as a Double Tree Hotel. Goldenpark LLC filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-30070) on May 8, 2011, to halt a secured lender's attempt to place the hotel in the hands of a receiver. Judge Peter Carroll presides over the case. The Debtor disclosed $24,180,000 in assets and $22,232,584 in liabilities as of the Chapter 11 filing. GOLDENPARK LLC: HMG Approved as Double Tree Hotel Manager --------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California authorized Goldenpark LLC to employ Hotel Managers Group as hotel manager. HMG is expected to operate and manage the hotel and all aspects related thereto including without limitation guest services, food and beverage, parking, lease operations, retail, office, concessions and vendors as required by the Debtor's franchise agreement with Hilton. Joel Biggs, president and CEO of HMG, tells the Court that HMG will be paid base fee per month equal to 2.5% of the hotel's gross revenues or $8,000 whichever is higher. HMG has not received any retainer of postpetition payment from the Debtor. HMG is owed $3,853 for prepetition services to the Debtor. Mr. Biggs assured the Court that HMG is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Goldenpark LLC Goldenpark LLC operates a 171-room hotel in Norwalk, California. Pursuant to a franchise agreement with Hilton Worldwide, the hotel is currently being operated as a Double Tree Hotel. Goldenpark LLC filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-30070) on May 8, 2011, to halt a secured lender's attempt to place the hotel in the hands of a receiver. Judge Peter Carroll presides over the case. The Debtor disclosed $24,180,000 in assets and $22,232,584 in liabilities as of the Chapter 11 filing. GRAHAM HOTEL: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Graham Hotel Group, LLC dba Holiday Inn Express, Graham, Texas 1581 Highway 380 Bypass Graham, TX 76450-2323 Bankruptcy Case No.: 11-70260 Chapter 11 Petition Date: July 5, 2011 Court: U.S. Bankruptcy Court Northern District of Texas (Wichita Falls) Judge: Harlin DeWayne Hale Debtor's Counsel: Jeffery D. Carruth, Esq. WEYCER, KAPLAN, PULASKI & ZUBER, P.C. 3030 Matlock Road, Suite 201 Arlington, TX 76015 Tel: (817) 795-5046 Fax: (866) 666-5322 E-mail: jcarruth@wkpz.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Sunil Patel, manager. GSC GROUP: Fights Lenders to Advance $235 Million Asset Sale ------------------------------------------------------------ Christie Smythe at Bankruptcy Law360 reports that the trustee overseeing GSC Group Inc. battled a group of lenders in New York bankruptcy court Wednesday over its efforts to halt a proposed $235 million sale of the company's assets to Black Diamond Capital Management LLC. According to Dow Jones' DBR Small Cap, the trustee told a judge Wednesday that a sale of the hedge-fund manager to lenders led by Black Diamond Capital Management would be better for the company than a competing plan by a minority group of GSC's lenders. The trustee, former bankruptcy judge James L. Garrity in June filed papers to sell the business and fully satisfy $256.8 million in secured claims. There would be $18.6 million cash left over, allowing the trustee to propose a liquidating Chapter 11 plan with $4.6 million for unsecured creditors. If the proposal is approved, the sale will take place July 6. All of the secured lenders other than Black Diamond Capital Finance LLC, Mr. Rochelle recounts, filed a Chapter 11 plan in April hoping to head off a sale of the business by Mr. Garrity. Their plan would give the lenders all the new stock and $160 million in new 10 percent senior notes to mature in 2026. Unsecured creditors would receive nothing. Mr. Garrity says the minority lenders' plan would face possibly insurmountable opposition because Black Diamond alone owns enough debt to vote it down. It's also inferior, the trustee said, because it would have nothing for unsecured creditors. About GSC Group Florham Park, New Jersey-based GSC Group, Inc. -- http://www.gsc.com/-- is a private equity firm specializing in mezzanine and fund of fund investments. Originally named Greenwich Street Capital Partners Inc. when it was a subsidiary of Travelers Group Inc., GSC became independent in 1998 and at one time had $28 billion of assets under management. Market reverses, termination of some funds, and withdrawal of customers' investments reduced funds under management at the time of bankruptcy to $8.4 billion. GSC Group filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010. Michael B. Solow, Esq., at Kaye Scholer LLP, serves as the Debtor's bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice and claims agent. Capstone Advisory Group, LLC, is the Debtor's financial advisor. The Debtor estimated its assets at $1 million to $10 million and debts at $100 million to $500 million as of the Chapter 11 filing. HARRY & DAVID: Wants Plan Filing Exclusivity Until Sept. 30 ----------------------------------------------------------- BankruptcyData.com reports that Harry & David Holdings filed with the U.S. Bankruptcy Court a motion to extend the exclusive period during which only the Company can file a Chapter 11 plan and solicit acceptances thereof through and including Sept. 30, 2011, and Nov. 30, 2011, respectively. The Court scheduled a July 26, 2011 hearing on the matter. 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. David G. Heiman, Esq., Brad B. Erens, Esq., and Timothy W. Hoffman, Esq., at Jones Day, are the Debtors' lead counsel. Daniel J. DeFranceschi, Esq., Paul Noble Heath, Esq., and Zachary Shapiro, Esq., at Richards Layton & Finger, serve as the Debtors' local 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. The Debtor also tapped DJM Realty Services, LLC, as real estate consultants; Alvarez & Marsal North America to provide the Debtors an interim chief executive officer and chief restructuring officer and certain additional officers; and McKinsey Recovery & Transformation Services U.S. LLC as their management consultant. 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. The Debtors disclosed $304.3 million in total assets and $360.8 million in total debts as of Dec. 25, 2010. The Debtors' proposed Plan of Reorganization 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. The Plan has the support of the Official Committee of Unsecured Creditors and the holders of approximately 81% of the Company's public notes. HAWKS PRAIRIE: Court OKs Eclipse-Led Auction on July 29 ------------------------------------------------------- The Hon. Brian D. Lynch of the U.S. Bankruptcy Court for the Western District of Washington approved the procedures to govern the sale of the commercial real property assets proposed by Hawks Prairie Investment, LLC, and secured creditor HomeStreet Bank. An auction will take place on July 29, 2011, at 10:00 a.m., PST, at the offices of Foster Pepper PLLC, at 1111 Third Avenue, Suite 3400, in Seattle, Washington. Qualified bids are due five business days prior to the auction date. A sale hearing take place on Aug. 12, 2011, at 9:30 a.m. The Debtor related that the assets to be purchased include all of Debtor's rights, title, and interest in and to all of the Debtor's commercial real and associated personal property. The real property comprising the commercial property is the 215 acres comprised of Parcels A and B. The Debtor signed a deal to sell the assets to Eclipse Development Group, LLC or its designee or assignee for $27 million, absent higher and better bids at the auciton. About Hawks Prairie Investment LLC Olympia, Washington-based Hawks Prairie Investment LLC owns real property in Thurston County, Washington. It filed for Chapter 11 bankruptcy protection (Bankr. W.D. Wash. Case No. 10-46635) on Aug. 13, 2010. Timothy W. Dore, Esq., at Ryan Swanson & Cleveland PLLC, represents the Debtor. The Company disclosed $89,000,071 in assets and $44,778,104 in liabilities as of the Chapter 11 filing. An affiliate, Pacific Investment Group LLC, filed a separate Chapter 11 petition (Bankr. W.D. Wash. Case No. 09-47915) on Oct. 22, 2009. HORIZON LINES: Extends Subscription Deadline to July 8 ------------------------------------------------------ Horizon Lines, Inc., entered into a fourth amendment with certain holders of a majority of its unsecured 4.25% convertible senior notes due 2012, to the previously announced Restructuring Support Agreement, dated June 1, 2011, as amended. The Amendment was entered into to extend, from July 1, 2011, to July 8, 2011, (i) the deadline by which the Company is to receive subscription commitments for $350 million in aggregate principal amount of the Company's 9.0% senior secured notes to be issued and sold to the Exchanging Holders and (ii) the Exchanging Holders' and the Company's continued support for the recapitalization and to allow the parties to discuss certain modifications to the terms of the recapitalization. A full-text copy of the Fourth Amendment to Restructuring Support Agreement is available for free at http://is.gd/Zy6sB5 About Horizon Lines Horizon Lines, Inc., based in Charlotte, North Carolina, through its wholly-owned indirect operating subsidiary, Horizon Lines, LLC, currently operates 11 of its 15 Jones Act qualified U.S. flag container ships in Jones Act liner services between the continental United States and either Alaska, Hawaii, or Puerto Rico and five U.S. flag container ships between the Far East, U.S. west coast and Guam. Horizon Lines reported a net loss of $57.97 million on $1.16 billion of operating revenue for the fiscal year ended Dec. 26, 2010, compared with a net loss of $31.27 million on $1.12 billion of operating revenue for the fiscal year ended Dec. 20, 2009. The Company's balance sheet at March 27, 2011, showed $804.0 million in total assets, $797.3 million in total liabilities, and stockholders' equity of $6.66 million. As reported in the TCR on March 30, 2011, Ernst & Young LLP, in Charlotte, North Carolina, expressed substantial doubt about Horizon Lines' ability to continue as a going concern, following the Company's 2010 results. According to Ernst & Young, there is uncertainty that Horizon Lines, Inc., will remain in compliance with certain debt covenants throughout 2011 and will be able to cure the acceleration clause contained in the convertible notes. * * * As reported in the Troubled Company Reporter on March 8, 2011, Moody's Investors Service said Horizon Lines, Inc.'s plea agreement regarding antitrust matters in the Puerto Rico trade lane is credit negative but does not at this time affect its 'Caa1' Corporate Family or its other debt ratings of Horizon. The last rating action on Horizon was on May 18, 2010 when Moody's lowered its ratings, including the corporate family rating to 'Caa1' and maintained the negative outlook. HOWREY LLP: Taps Protiviti Inc. as Financial Advisor ---------------------------------------------------- Dow Jones' DBR Small Cap reports that Howrey LLP seeks to hire Protiviti Inc. as financial advisor. Howrey filed the request on June 24 with the U.S. Bankruptcy Court in San Francisco. Three creditors filed an involuntary Chapter 7 petition (Bankr. N.D. Calif. Case No. 11-31376) on April 11, 2011, against the remnants of the Washington-based law firm Howrey LLP. The filing was in San Francisco, where the firm had an office. The firm previously was known as Howrey & Simon and Howrey Simon Arnold & White LLP. The firm at one time had more than 700 lawyers in 17 offices. The partners voted to dissolve in March. The firm specialized in antitrust and intellectual-property matters. The three creditors filing the involuntary petition together have $36,600 in claims, according to their petition. The firm can defeat the petition by showing it is generally paying debts as they come due. The firm can also consent to bankruptcy and convert the case in Chapter 11, where the firm's management would remain in control, at least initially. INUVO(R) INC.: NYSE Amex Accepts Firm's Plan of Compliance ---------------------------------------------------------- Inuvo(R), Inc. received notice from the NYSE Amex that the Exchange has accepted the Company's plan to regain compliance with the continued listing standards of the Exchange by December 8, 2012 and will continue to list Inuvo's common stock on the NYSE Amex during the extension period. Wally Ruiz, Inuvo's Chief Financial Officer, commented on the approval, "We are pleased with the decision of the NYSE Amex. We submitted a realistic plan to retain compliance and recently executed on the first part of the plan by completing an equity raise. We expect to implement the balance of the plan during the compliance period." On May 9, 2011, Inuvo received noticed from the NYSE Amex Staff indicating that Inuvo was not in compliance with Section 1003(a)(ii) of the NYSE Amex Company Guide, specifically with stockholders' equity of less than $4,000,000 and losses from continuing operations and/or net losses in three of its four most recent fiscal years. Inuvo was afforded the opportunity to submit a plan of compliance to the Exchange and on June 8, 2011, Inuvo presented its plan to the Exchange. On July 5, 2011, the Exchange notified Inuvo that it accepted the Company's plan of compliance and granted the Company an extension until December 8, 2012 to regain compliance with the continued listing standards. Inuvo will be subject to periodic review by Exchange Staff during the extension period. Failure to make progress consistent with the plan or to regain compliance with the continued listing standards by the end of the extension period could result in the Company being delisted from the NYSE Amex LLC. About Inuvo, Inc. Inuvo(R), Inc. --http://www.inuvo.com/ -- is an online technology and services company specialized in driving clicks, leads and sales through targeting that utilizes unique data and sophisticated analytics.Inc. (VCLK), Marchex, Inc. (MCHX), InterCLICK, Inc. (ICLK), LookSmart, Ltd. (LOOK), and Local.com Corp. (LOCM). JACK OUT OF THE BOX: Bankruptcy Judge Dismisses Chapter 11 Case --------------------------------------------------------------- According to Dallas Voice, a federal bankruptcy judge dismissed the bankruptcy case of Jack Out of the Box LLC, saying the numbers didn't add up in the Company's plan to get out of the debt. Jack Out of the Box dba Jack's Chill Grill filed for Chapter 11 bankruptcy protection (Bankr. N.D. Texas Case No. 10-38809) on Dec. 16, 2011. A copy of the petition is at http://bankrupt.com/misc/txnb10-38809.pdf JACKSON HEWITT: Has Cash Collateral Use Approval Until Aug. 6 ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Jackson Hewitt Tax Service Inc. received final approval this week to use cash representing collateral for the claims of secured lenders. The authorization runs until Aug. 6, given the tax preparer's intention to transfer the business to secured lenders under a plan negotiated before the Chapter 11 filing. Mr. Rochelle notes that the official committee representing unsecured creditors was given a $50,000 budget to investigate the validity of the lenders' secured claims. Lawsuits belonging to the company were excluded from the lenders' collateral, so unsecured creditors might have some recovery if the plan goes through as written. The committee can file a lawsuit challenging the validity of liens as few as five days before a confirmation hearing begins to approve the Chapter 11 plan. Jackson Hewitt had been hoping the confirmation hearing would begin July 8. Given opposition from the committee, whose constituents would receive nothing in the plan, the confirmation hearing was pushed back to August. Jackson Hewitt worked out the plan before the Chapter 11 filing in late May. Secured lenders owed $357 million would receive all the new stock along with a new $100 million term loan. They already voted to approve the plan. About Jackson Hewitt Jackson Hewitt Tax Service Inc. (NYSE: JTX) -- http://www.jacksonhewitt.com/-- provides computerized preparation of federal, state and local individual income tax returns in the United States through a nationwide network of franchised and company-owned offices operating under the brand name Jackson Hewitt Tax Service(R). The Company provides its customers with convenient, fast and quality tax return preparation services and electronic filing. In connection with their tax return preparation experience, the Company's customers may select various financial products to suit their needs, including refund anticipation loans -- RALs -- in the offices where such financial products are available. Jackson Hewitt is the second largest paid tax return preparer in the United States, having prepared approximately 2.6 million tax returns for the 2011 tax season, which is between 3% and 4% of the total market for paid tax return preparation services. Jackson Hewitt and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-11587) on May 24, 2011. Judge Mary F. Walrath presides over the case. Skadden, Arps, Slate, Meagher & Flom LLP, serves as the Debtors' bankruptcy counsel. Alvarez & Marsal North America, LLC, serves as their financial advisor. Moelis & Company LLC acts as investment banker. The Garden City Group, Inc., serves as the Debtors' Claims and Noticing Agent. The Debtors also tapped Deloitte & Touche to serve as tax advisors and Kekst & Company to serve as communications advisors. JOSEPH DETWEILER: Court Rules on Motion to Dismiss Creditors' Suit ------------------------------------------------------------------ Bankruptcy Judge Russ Kendig ruled on defendant's request to dismiss certain plaintiffs in the lawsuit, Sequatchie Mountain Creditors, v. Joseph J. Detweiler, Adv. Proc. No. 09-6118 (Bankr. N.D. Ohio). The Defendant seeks dismissal of 11 of the 18 named plaintiffs, alleging failure to comply with the Court's order to compel. In April 2010, the Defendant served initial discovery requests on the 18 named plaintiffs. In March 2011, the Defendant moved to compel responses to those requests. The Court granted the order to compel on April 20, 2011. Seven of the 11 plaintiffs do not oppose dismissal. They are Donald Bird, Patricia Bird, Joseph Kohan, Teresa Kohan, John Hallman (deceased), Roger Pearson and Sharon Pearson. Since there is no controversy between the parties as to these seven parties, the motion to dismiss the claims of these plaintiffs is granted. As to the remaining four plaintiffs -- Lisa Allen, Robert Allen, Shirley Hallman and Wesley Jinks -- the Court denied the request. The Court noted that Lisa Allen and Robert Allen were not among the plaintiffs compelled to provide discovery responses. The Court said it would be unfair to dismiss them for failing to comply with an order that did not direct them to do anything. The Court also pointed out that the motion to dismiss indicates that Shirley Hallman and Wesley Jinks furnished the requested discovery on the same day the motion to dismiss was filed. Thus, at the time of filing, the Defendant's own motion indicates they had fully complied with the discovery request, albeit inexplicably late. A copy of the Court's July 6, 2011 Memorandum of Opinion is available at http://is.gd/b8mzsZfrom Leagle.com. Based in Uniontown, Ohio, Joseph J. Detweiler filed for Chapter 11 protection on Aug. 17, 2009 (Bankr. N.D. Ohio Case No. 09-63377). Anthony J. DeGirolamo, Esq., represents the Debtor. In his petition, the Debtor has $3,669,999 in total assets and $32,913,552 in total debts. KIEBLER RECREATION: Trustee Taps Jones Lang to Market Assets ------------------------------------------------------------ David Simon, Chapter 11 trustee in the case Kiebler Recreation, LLC, asks the U.S. Bankruptcy Court for the Northern District Of Ohio for permission to retain Jones Lang LaSalle Hotels, a division of Jones Lang LaSalle Americas, Inc., in conjunction with Alpine Realty Capital, LLC, as the investment banker/business broker. JLLH/ARC will market certain assets, including a hotel, ski areas, golf courses and several condominium complexes, for sale and otherwise assist with the sale of these assets. More specifically, JLLH/ARC proposes to provide these services to the Debtor's estate: -- determine the appropriate structure, pricing and marketing strategy for the transaction; -- prepare a comprehensive marketing presentation (Offering Memorandum) and due diligence materials with respect to the assets; -- identify prospective purchasers; -- assist the Debtor with sale contract or financing negotiations; and -- coordinate and consummate the transaction. As compensation for the services, JLLH/ARC has requested a fee equal to 3.0% of the gross consideration paid for the assets up to $12,000,000 and 5.0% of the gross consideration paid in excess of $12,000,000. In addition, JLLH/ARC requests reimbursement of all out-of-pocket expenses in an amount not to exceed $10,000, such amount to be paid at the closing of the transaction. To the best of the trustee's knowledge, JLLH/ARC is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Kiebler Recreation Peek'n Peak Resort -- http://www.pknpk.com/-- is a recreational and leisure facility. Findley Lake, New York-based Kiebler Recreation, LLC, dba Peek'n Peak Resort, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 10-15099) on May 26, 2010. Robert C. Folland, Esq., at Thompson Hine LLP, represents the Debtor. The Company estimated assets and debts at $10 million to $50 million as of the Petition Date. An affiliate, Kiebler Slippery Rock, LLC, filed a separate Chapter 11 petition on September 25, 2009 (Bankr. N.D. Ohio Case No. 09- 19087). KIEBLER RECREATION: Kohrman Jackson OK'd as Counsel for Trustee --------------------------------------------------------------- The Hon. Raldoph Baxter of the U.S. Bankruptcy Court for the District of Ohio authorized David O. Simon, the duly appointed and acting Chapter 11 trustee in the case of Kiebler Recreation, LLC, to retain Mary K. Whitmer, Esq. and Kohrman Jackson & Krantz P.L.L. as counsel. KJK is expected to among other things: a) assist the trustee in the sale of the P&P real and personal property consistent with the terms and conditions of a stipulation and agreed order setting terms of sale process, appointment of chief restructuring officer and marketing consultant, debtor in possession financing, and settlement of claims entered June 3, 2011, or to otherwise sell or dispose of the P&P real and personal property in the most expeditious and beneficial manner, including seeking abandonment or relief from the stay if appropriate; b) assist the trustee with investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtors and any other matters relevant to this bankruptcy; and c) assist the trustee with the identification and prosecution of claims and causes of action that might be asserted by the trustee on behalf of the estate including, but not limited to, causes of action based on one or more of the following legal theories: breach of contract, breach of fiduciary duty, fraudulent transfers, fraud, conversion, civil conspiracy and preferential transfers. Ms. Whitmer, a partner at KJK, tells the Court that her rate is $335 per hour. The hourly rates of other KJK's personnel are: Partners $250 - $425 Associates $185 - $225 Paralegals $125 - $140 James W. Ehrman $330 John P. Archer $240 Connie S. Carr $280 David S. Blocker $220 Mandeep Saini, paralegal $145 Ms. Whitmer, assures the Court that KJK is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Mary K. Whitmer, Esq. KOHRMAN, JACKSON & KRANTZ P.L.L. 1375 E. 9th Street, 20th Floor One Cleveland Center Cleveland, Ohio 44114-1793 Tel: (216) 696-8700 Fax: (216) 621-6536 E-mail: mkw@kjk.com About Kiebler Recreation Peek'n Peak Resort -- http://www.pknpk.com/-- is a recreational and leisure facility. Findley Lake, New York-based Kiebler Recreation, LLC, dba Peek'n Peak Resort, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 10-15099) on May 26, 2010. Robert C. Folland, Esq., at Thompson Hine LLP, represents the Debtor. The Company estimated assets and debts at $10 million to $50 million as of the Petition Date. An affiliate, Kiebler Slippery Rock, LLC, filed a separate Chapter 11 petition on September 25, 2009 (Bankr. N.D. Ohio Case No. 09- 19087). LA JOLLA: Preferred Stock Holders Agree to Waive Dividends ---------------------------------------------------------- La Jolla Pharmaceutical Company entered into an Amendment Agreement, dated as of June 30, 2011, with the holders of a majority of the Company's outstanding preferred stock in order to provide the Company with additional working capital to allow the Company to more fully evaluate certain product acquisition or in- licensing opportunities that are currently being investigated. Pursuant to the Amendment Agreement, the Holders agreed to waive the dividends that would otherwise accrue on the outstanding Series C-1 1 Convertible Preferred Stock and Series C-2 1 Convertible Preferred Stock held of record by the Holders. The waiver of dividends will retroactively take effect as of June 1, 2011, and continue through Aug. 31, 2011, after which time dividends will begin to accrue again on the Series C Preferred Stock as set forth in Article III.A. of the New Certificate of Designations. The Holders have also agreed to provide the Company with additional working capital by July 29, 2011, in an amount to be determined, if the Requisite Holders determine by July 22, 2011, that, as of that date, the Company is continuing to pursue a Strategic Transaction. Additionally, the Holders have agreed to purchase up to all of the outstanding Series C Preferred Stock and certain warrants held by current and former Company employees, including the Officers, who will have the right to require the Holders to purchase these securities for a limited period of time following the employee's termination of service with the Company. As a partial inducement to cause the Holders to enter into the Amendment Agreement, the Company's two executive officers agreed to temporarily reduce their salaries from July 1, 2011, through Aug. 31, 2011, as follows: Deirdre Gillespie, M.D., Chief Executive Officer, by a total of $31,200, and Gail Sloan, Chief Financial Officer, by a total of $6,109. In connection with this reduction in salary, the Officers will have a corresponding reduction in total work hours during this time, resulting in a 50% reduction for Dr. Gillespie and a 20% reduction for Ms. Sloan. A copy of the Amendment Agreement is available for free at: http://is.gd/BkeD90 About La Jolla Pharmaceutical San Diego, Calif.-based La Jolla Pharmaceutical Company (OTC BB: LJPC) -- http://www.ljpc.com/-- is a biopharmaceutical company that has historically focused on the development and testing of Riquent as a treatment for Lupus nephritis. The Company's balance sheet at March 31, 2011, showed $6.74 million in total assets, $12.58 million in total liabilities, all current, $5.57 million in Series C-1 1 redeemable convertible preferred stock, and a $11.41 million total stockholders' deficit. The Company reported a net loss of $3.76 million on $0 of revenue from collaboration agreement for the year ended Dec. 31, 2010, compared with a net loss of $8.63 million on $8.12 million of revenue from collaboration agreement during the prior year. As reported by the TCR on April 18, 2011, BDO USA, LLP, in San Diego, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has suffered recurring losses from operations, an accumulated deficit of $428 million as of Dec. 31, 2010 and has no current source of revenues. LAMBUTH UNIVERSITY: In Ch. 11, School Closed Effective June 30 -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Lambuth University in Jackson, Tennessee, said in its Web site that the trustees of the liberal arts school, founded in 1843, decided to close the school effective June 30. Lambuth filed for Chapter 11 protection on the same day (Bankr. W.D. Tenn. Case No. 11-11942) in Jackson, Tennessee, on the same day. Bond Buyer said the school has $5.3 million of taxable and non- taxable bonds, insured by Radian Asset Assurance Inc. Steven N. Douglass, Esq., at Harris Shelton Hanover Walsh, PLLC, serves as counsel to the Debtor. The Debtor estimated assets of up to $10 million and debts of $10 million to $50 million as of the Chapter 11 filing. A case summary for Lambuth University is in the July 6, 2011 edition of the Troubled Company Reporter. LEHMAN BROTHERS: Court OKs Stipulation With LEX Over Properties --------------------------------------------------------------- Lex Special Assets LLC and U.S. Bank National Association, as Trustee for certain securitization trusts, assert that they are the current holders of certain first mortgages, originally executed in favor of Debtor BNC Mortgage, Inc., now known as BNC Mortgage LLC. Each First Mortgage secures the repayment of the principal sums due under certain notes. The First Mortgages granted Mortgage Electronic Registration Systems, Inc., as nominee for BNC Mortgage Inc., a security interest in certain properties. BNC subsequently transferred, and no longer retains any interest in, the First Mortgages. Lex and U.S. Bank also assert that there are subordinate mortgages on the Properties held by MERS, as nominee for BNC Mortgage, Inc. Lex and U.S. Bank have brought or intend to bring foreclosure proceedings against the Properties in state courts. The Foreclosure Proceedings have been stayed by BNC's Chapter 11 case. The Debtors submit that BNC previously transferred or otherwise disposed of its interests in the Second Mortgages. As a result of these transfers, BNC does not currently hold an interest in any of the First Mortgages or the Second Mortgages. Due to BNC's usage of MERS as its nominee, however, BNC's interest in the Second Mortgages remains on the local property records, creating an impediment to Lex and U.S. Bank's acquisition of insurable title to the Properties. Lists of Properties and assignment of the Second Mortgages are available for free at: * http://bankrupt.com/misc/Lehman_BNC_Properties_052711.pdf * http://bankrupt.com/misc/Lehman_BNC_2ndMortgage_052711.pdf To resolve the issues relating to the Properties, BNC entered into a stipulation with Lex and U.S. Bank. The Parties agree that upon their stipulation's effective date, to the extent that the automatic stay is applicable, it will be modified with respect to the interests of Lex and U.S. Bank, their successors, and assigns, in the Properties, and Lex and U.S. Bank will be permitted to exercise their rights under applicable non- bankruptcy law against the Properties. Except as provided in the stipulation, the provisions of Section 362(a) of the Bankruptcy Code, including those provisions prohibiting any act to collect, assess, or recover a claim that arose prepetition from BNC's bankruptcy estate and assets or property of BNC, will remain in full force and effect The stipulation has been approved by the bankruptcy court. 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: European Unit Sues First Commercial for $12-Mil. ----------------------------------------------------------------- The European arm of bankrupt Lehman Brothers Holdings Inc. sued First Commercial Bank in New York, claiming it is owed $12 million in contractually mandated closeout amounts from derivative transactions that were outstanding when LBHI shut down, Richard Vanderford of BankruptcyLaw360 reports on June 23, 2011. The report relates that the New York state court system will now have to sort out the gap between the two banks' estimation of what they are each owed, as the Taiwan-based FCB claims Lehman owes it more than $25 million. 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: Ex-NBA Owner Wins $2-Mil. Dispute From Collapse ---------------------------------------------------------------- The Financial Industry Regulatory Authority ordered UBS Financial Services to pay Pat Croce, former owner of Philadelphia 76ers, damages for a personal investment he made in a note in bankrupt Lehman Brothers, Suzanne Barlyn of The Wall Street Journal reported on June 13, 2011. The panel found UBS liable for $2 million in damages, less the Lehman notes' present value of about $480,000. It also ordered the UBS AG unit to pay interest from September 2008, which Mr. Croce's lawyer estimated at $276,000. Mr. Croce and his wife, Diane, filed their claim against UBS in 2010, according to the ruling by a FINRA panel. One of the panel's three members dissented, according to the report. The arbitrators didn't include their reasons for the ruling or dissent, as is typical of most arbitration awards, the report noted. "This case shows even if you're a sophisticated or well-known individual, the arbitrators are finding that UBS misled investors," says Jacob Zamansky, a New York-based securities lawyer who represented the Croces, according to the report. FINRA panels have ruled in favor of investors roughly five times since 2008 in cases involving Lehman structured notes that were sold by UBS, the report noted. The award is among the largest involving Lehman structured products that were sold by UBS, the report further noted. A Finra panel ordered UBS to pay $2.2 million to Thomas F. Motamed, chairman and chief executive of insurance giant CNA Financial Corp. for his losses. A UBS spokeswoman says the firm "respectfully disagrees" with the ruling, the report relates. "The losses on Lehman notes were the result of the bankruptcy of Lehman in 2008," she said. "That event was unprecedented and unexpected by virtually all major market participants, including UBS. We continue to believe the vast majority of Lehman notes were sold appropriately." 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: To Recover up To $65-Bil. for Creditors -------------------------------------------------------- Lehman Brothers Holding Inc. plans to raise as much as $65 billion for creditors and begin making distributions next year, Chief Executive Officer Bryan Marsal said in an interview on CNBC on June 16. Lehman, according to Mr. Marsal, is working on a revised liquidation plan and will recover $60 billion to $65 billion for creditors from its assets. He expects to begin making distributions in the first quarter of 2012. "There undoubtedly will be some holdouts, but I think we're going to a have a plan that's going to get the blessing" of creditors, Mr. Marsal said, according to Bloomberg News.' Lehman, which filed for bankruptcy in 2008, is competing against two rival proposals to pay creditors. One is backed by a group of bondholders, including hedge fund Paulson & Co. and the California Public Employees' Retirement System. Another is from a creditor group that includes Goldman Sachs Group Inc., Deutsche Bank AG, and Morgan Stanley. The groups are clashing over how to distribute Lehman's assets and how much to pay various groups of creditors. Lehman is negotiating with those creditor groups to resolve their opposition to its existing proposal, Kimberly Macleod, Lehman's spokeswoman, said in a phone interview, according to Bloomberg. Any agreement could be the basis of a revised Lehman plan, she said, the report further related. 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) LOS ANGELES DODGERS: Court Denies Discovery Requests on Selig ------------------------------------------------------------- Eric Morath, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Kevin Gross on Thursday blocked the Los Angeles Dodgers from gathering testimony from Major League Baseball Commissioner Bud Selig and from viewing potentially sensitive documents about the league's handling of other teams' financial woes. According to DBR, Judge Gross said the information the Dodgers were seeking went beyond the scope of the matter currently before him: whether to approve a $150 million bankruptcy loan from a hedge fund owned by J.P. Morgan Chase & Co. or instead force the club to accept financing from MLB. "The discovery requested is overly broad and burdensome," Judge Gross said at a hearing Thursday, according to the report. "This is not the occasion to turn the [loan] hearing into a trial of the commissioner." A final hearing on the Dodgers' loan request is set for July 20. According to DBR, it was unveiled at Thursday's hearing that the Dodgers wanted information from the league about its handling of: -- the New York Mets' financial problems. Mets owners Fred Wilpon and Saul Katz are facing a $1 billion lawsuit from the trustee-liquidating Ponzi-scheme purveyor Bernard Madoff's firm. The Dodgers implied that the league has been supportive of the Mets' owners but not of Dodgers' owner Frank McCourt, whose financial problems are partially tied to his pending divorce. -- violent incidents that occurred at other team's ballparks -- including an unspecified incident where a fan died. In 2009, a man died after being involved in an altercation at a bar near the Philadelphia Phillies' stadium. Also in recent years, at least two fans have died after falling from the upper reaches of a MLB stadium. According to DBR, despite the denial of its requests, the Dodgers will still ask Judge Gross to approve the financing the team secured from Highbridge Capital Management LLC over a package from MLB, even though the rival loan has a lower interest rate and better terms. The Dodgers say MLB would be an uncooperative lender and is seeking to use the loan to oust Mr. McCourt and gain control over the team. Mr. Morath also reports that a handful of Los Angeles Dodgers fans have sent separate letters to Judge Gross, asking him to play umpire and send team owner Frank McCourt packing. DBR ran excerpts of those letters: "I beg you Mr. Gross to please do the right thing and . . . put the team up for auction to someone who will no doubtedly [sic] manage this once jewel of the West Coast to what it needs to be, the Yankees of the West," wrote Michael D. Evans, a Farmers Insurance Group agent from Artesia, Calif. Mr. Evans wrote in on company letterhead. "As a lifelong baseball fan growing up in Los Angeles, I implore you to side with Major League Baseball and demand that Frank McCourt immediately begin proceedings that will separate him from his place as owner of the Los Angeles Dodgers," wrote Colin True of Van Nuys, Calif. "The citizens want their Dodgers to be run in a sound business way like they had been . . . before Mr. McCourt bought the team with borrowed money," John Garvin of Azusa, Calif., told the judge. DBR says a spokeswoman for the team declined to comment on Mr. McCourt's behalf. "I wish for those childhood days when baseball was just a game, it certainly has changed," Judge Gross said Thursday as he opened a hearing in the team's bankruptcy case. About the Los Angeles Dodgers Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a professional Major League Baseball club in the Los Angeles metropolitan area. Frank McCourt, a Boston real-estate developer who unsuccessfully bid for the Boston Red Sox, bought the Dodgers from Rupert Murdoch's Fox Entertainment Group, Inc. in 2004 for $330 million. Mr. McCourt also bought the Dodgers Stadium from Fox for $100 million. Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB Commissioner Bud Selig rejected a television deal with News Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for June 30 and July 1. Fox Sports has exclusive cable television rights for Dodgers games until the end of 2013 baseball season. Chapter 11 filings were also made for LA Real Estate LLC, an affiliated entity which owns Dodger Stadium, and three other related holding companies. The petition estimates assets of up to $500 million and debts of up to $1 billion. According to Forbes, the team is worth about $800 million, making it the third most valuable baseball team after the New York Yankees and the Boston Red Sox. Judge Kevin Gross presides over the case. Lawyers at Young, Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the Debtors' bankruptcy counsel. MLB is represented by: Glenn M. Kurtz, Esq. WHITE & CASE 1155 Avenue of the Americas New York, NY 10036-2787 Tel: 212-819-8252 Fax: 212-354-8113 E-mail: gkurtz@whitecase.com The LA Dodgers is the 12th sports team in North America to have sought bankruptcy protection, according to The Wall Street Journal. MEDCLEAN TECHNOLOGIES: Hires Rosenberg Rich as New Accountants -------------------------------------------------------------- The board of directors of MedClean Technologies, Inc., voted to dismiss Child, Van Wagoner & Bradshaw, PLLC, as the Company's independent registered public accounting firm. CVWB's report on the financial statements for the fiscal years ended Dec. 31, 2010, and 2009 and through June 29, 2011, contained no adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principle, except that the report contained a modification to the effect that there was substantial doubt as to the Company's ability to continue as a going concern. During the fiscal years ended Dec. 31, 2010, and 2009 and through June 29, 2011, there were no disagreements with CVWB on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of CVWB, would have caused it to make reference to the subject matter of the disagreements in its reports on the financial statements for such year. During the fiscal years ended Dec. 31, 2010, and 2009 and through June 29, 2011, there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K. On June 29, 2011, the board of directors and the audit committee of the Company approved the engagement of Rosenberg Rich Baker Berman & Company, Somerset, New Jersey, as the Company's new independent registered public accounting firm. During the fiscal year ended Dec. 31, 2010, and the subsequent interim period prior to the engagement of Rosenberg Rich, the Company has not consulted Rosenberg Rich regarding (i) the application of accounting principles to any specified transaction, either completed or proposed, (ii) the type of audit opinion that might be rendered on the Company's financial statements, or (iii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(v)) or a reportable event (as defined in Item 304(a)(1)(v)). About MedClean Technologies Based in Bethel, Connecticut, MedClean Technologies, Inc., provides solutions for managing medical waste on site including designing, selling, installing and servicing on site (i.e. "in- situ") turnkey systems to treat regulated medical waste. The Company's balance sheet at March 31, 2011, showed $1.8 million in total assets, $2.1 million in total liabilities, and a stockholders' deficit of $295,325. As reported in the TCR on April 6, 2011, Child, Van Wagoner & Bradshaw, PLLC, in Salt Lake City, Utah, expressed substantial doubt about the MedClean Technologies' ability to meet its obligations and to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred substantial recurring losses. MEDICAL CONNECTIONS: Engages Grant Thornton as New Accountants -------------------------------------------------------------- The Board of Directors of Medical Connections Holdings, Inc., dismissed De Meo, Young, McGrath, as the Company's independent registered public accounting firm. The reports of DYM on the Company's financial statements as of and for the years ended Dec. 31, 2010, and Dec. 31, 2009, contained no adverse opinion or disclaimer of opinion nor was qualified or modified as to uncertainty, audit scope, or accounting principle. During the recent fiscal years ending Dec. 31, 2010, and Dec. 31, 2009, and the subsequent period through May 31, 2011, there have been no (i) disagreements with DYM on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to DYM's satisfaction, would have caused DYM to make reference to the subject matter of the disagreement in connection with its reports; or (ii) "reportable events" as defined in Item 304(a)(1)(v) of Regulation S-K. On June 30, 2011, the Board of Directors of the Company engaged Grant Thornton, LLP, as the Company's new independent registered public accounting firm. During the recent fiscal years ending Dec. 31, 2010, and Dec. 31, 2009, and the subsequent interim period prior to the engagement of GT, the Company has not consulted GT regarding (i) the application of accounting principles to any specified transaction, either completed or proposed, (ii) the type of audit opinion that might be rendered on the Company's financial statements, or (iii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv)) or a reportable event (as defined in Item 304(a)(1)(v)). On June 30, 2011, the Company's Board of Directors approved the grant of bonus payments to Brian Neill, Anthony Nicolosi and Jeffrey Rosenfeld for exceptional services rendered in fiscal 2011 and to ensure continuity of management at the Company during its new growth initiatives. These services rendered by Mr. Nicolosi, Mr. Neill and Mr. Rosenfeld included, but are not limited to identifying implementing certain operational changes in the Company's business. In the first quarter of fiscal 2011, in which the Company's operating revenues increased by 42.1% in the first quarter of 2011 and negotiating the settlement of a litigation matter with Nightingale Nurses, LLC. The Board authorized the Company to make these bonus payments by issuing 30,000 shares of the Company's Series C Preferred Stock to each of Mr. Rosenfeld, Mr. Neill and Mr. Nicolosi. In addition, on June 30, 2011, Mr. Nicolosi and the Board agreed that, in an effort to simplify the Company's capital structure, the Company will cancel 50,000 shares of the Company's Series B Preferred Stock held by Mr. Nicolosi in exchange for 5,000 shares of the Company's Series C Preferred Stock issued to Mr. Nicolosi. About Medical Connections Boca Raton, Fla.-based Medical Connections Holdings, Inc., is a healthcare staffing company which provides staffing services for allied professionals and nurses to the Company's clients on a national basis. The Company's balance sheet at March 31, 2011, showed $3.3 million in total assets, $538,039 in total liabilities, and stockholders' equity of $2.8 million. As reported in the TCR on April 6, 2011, De Meo, Young, McGrath, in Boca Raton, Fla., expressed substantial doubt about Medical Connections Holdings' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that of the Company's dependence on outside financing, lack of sufficient working capital, and recurring losses from consolidated operations. MMFX CANADIAN: To Present Plan for Confirmation on July 22 ---------------------------------------------------------- The Hon. Robert Kwan of the U.S. Bankruptcy Court for the Central District of California last month approved the adequacy of the joint disclosure statement in explaining the first amended joint Chapter 11 plan of reorganization proposed by MMFX Canadian Holdings Inc. and its debtor-affiliates, the Official Committee of Unsecured Creditors, Fourth Third LLC, and Investment Funding Inc. The Court ruled that the disclosure statement contains "adequate information" within the meaning of section 1125 of the Bankruptcy Code. A hearing is set for July 22, 2011, at 9:00 a.m., pacific standard time, in Courtroom 5D, 411 West Fourth Street, Santa Ana, California, to consider confirmation of the Plan. Objections to confirmation, if any, are due July 8, 2011. All ballots with respect to the Plan were required to be submitted to Robert Sahyan, Sheppard, Mullin, Richter & Hampton LLP, Four Embarcadero Center, 17th Floor, San Francisco, California 94111, no later than 5:00 p.m. on July 8, 2011. Overview of the Plan The Plan envisions two potential scenarios by which the Debtors will reorganize. The Plan envisions the continuance of the Debtors' current investment banking process, seeking solicitation of bids to invest in, license or acquire some or all of the Debtors' assets. In the event there is a Successful Bid under the Investment Banking Process, the Debtors will restructure and provide for recoveries to Holders of Allowed Claims and Holders of Interests in accordance with Scenario A. In the event the Debtors cannot secure and obtain Court approval of a Successful Bid on or before July 22, 2011, the Debtors will restructure and provide recoveries to Holders of Allowed Claims in accordance with Scenario B. Scenario B is premised upon Fourth Third and Investment Funding's converting their Allowed General Unsecured Claims to equity and providing the Reorganized Debtors with the Exit Facility, thus positioning the Debtors for success going forward, benefitting creditors who will continue to transact business with the Reorganized Debtors. The Exit Facility would provide a minimum of $1,000,000 to be made available to fund payments to Holders of Allowed General Unsecured Claims, Allowed Priority Tax Claims and Allowed Non-Tax Priority Claims, which the Proponents currently estimate should be sufficient to make a minimum of 60% distribution to Holders of Allowed General Unsecured Claims. Depending upon the results of the Debtors' operations and ability to meet budget forecasts through the Effective Date, and the accuracy of the Proponents assumptions regarding the total amount of the DIP Loan, Allowed Secured Claims and Allowed Administrative Claims against the Debtors' Estates, and the amount of Allowed Priority Tax Claims, Allowed Non-Tax Priority Claims and Allowed General Unsecured Claims, the Proponents currently estimate that the proceeds of the Exit Facility may be sufficient to pay all Allowed General Unsecured Claims in full plus interest. If the proceeds of the Exit Facility are not sufficient to pay the Holders of Allowed General Unsecured Claims in full plus interest, the Committee, Fourth Third and Investment Funding will engage in further negotiations, the outcome of which will be to provide Holders of General Unsecured Claims with a recovery under the Plan equal to or greater than what would be achieved based upon the funds available to pay Holders of General Unsecured Claims from the Exit Facility as presently committed. The Proponents believed that incorporating the two alternative scenarios will maximize value. The Plan allows for both the continuation and conclusion of a robust and complete investment banking process and, to the extent such process is not successful, preservation of the Debtors' ability to confirm a plan of reorganization within a reasonable time frame, avoiding significant administrative expenses and maximizing returns to Holders of Allowed Claims. Under the plan, holders of general unsecured claims are expected to recover between 60% and 100% of their allowed claim. Holders of intercompany claims will get between 0% and 100% while holders of subordinated claims and interest will not receive any distribution. A full-text copy of the disclosure statement is available for free at http://bankrupt.com/misc/MMFXCANADIAN_disclosurestatement.pdf About MMFX International Irvine, California-based MMFX International Holdings, Inc., and MMFX Canadian Holdings, Inc., filed for Chapter 11 protection (Bankr. C.D. Calif. Case Nos. 10-10085 and 10-10083) on Jan. 5, 2010. Margaret M. Mann, Esq., at Sheppard Mullin Richter & Hampton LLP represents the Debtors in their restructuring efforts. MMFX Int'l and MMFX Canadian estimated assets and debts at $50 million to $100 million as of the Chapter 11 filing. MONROE CENTER: Dist. Court Tosses Akai Fine Arts' Admin. Claim -------------------------------------------------------------- District Judge Katharine S. Hayden affirmed a bankruptcy court ruling denying Akai Fine Arts, Inc.'s motion for reconsideration of an order expunging its administrative claim against Monroe Center LLC. Akai filed a timely administrative expense claim, which was partially liquidated and partially unliquidated, for $68,730, which Akai states are sums owed to it as a result of the Debtor's diversion of rents from Akai's subtenants. The unliquidated component sought relief for wrongful eviction. The Official Committee of Unsecured Creditors objected and Akai neither filed opposition nor appeared at a hearing on March 2, 2010. The bankruptcy court granted the Committee's unopposed motion and expunged Akai's claim. The next day, Akai moved for reconsideration or vacatur of the order expunging its claim, and after a hearing on March 30, 2010, the bankruptcy court denied the motion in an oral opinion, and Akai appealed. In a July 1, 2011 Opinion, Judge Hayden said the District Court cannot conclude that the lower court abused its discretion when determining that Akai did not establish excusable neglect. The case is Akai Fine Arts, Inc., Appellant, v. Official Committee of Unsecured Creditors, Appellee, Civ. Action No. 10-5451 (D. N.J.). A copy of Judge Hayden's decision is available at http://is.gd/D10KrXfrom Leagle.com. About Monroe Center Monroe Center, LLC, in Hoboken, New Jersey, filed for Chapter 11 bankruptcy (Bankr. D. N.J. Case No. 08-27203) on Sept. 10, 2008, represented by Joseph Markowitz, Esq. -- jmarkowitz@mgs-law.com -- at Markowitz, Gravelle & Schwimmer. The petition says estimated assets are unknown while estimated debts are from $10 million to $50 million. MT. JORDAN: Chap. 11 Plan Features Sale of Real Estate Assets ------------------------------------------------------------- Mt. Jordan Limited Partnership filed with the U.S. Bankruptcy Court for the District of Utah, Central Division, a plan of reorganization and an accompanying disclosure statement on June 30, 2011. A central feature of the Plan is a sale/option agreement, which provides a means for liquidating the Debtor's approximately 298.75 acres of undeveloped land in Bluffdale, Utah, at a price of $107,000 per acre, a significant increase over the appraised value of $75,000 per acre. Class 1 under the Plan consists of the claim by Zions First National Bank. Zions Bank will retain its Lien on the Zions Collateral and will release the collateral from the Zions Trust Deed at the Zions Release Price when and as Zions Bank receives payments on the Zions Claim. The Zions Claim will be paid in full, with interest accruing at 7% per annum after the Effective Date, by no later 60 months after the Effective Date. Zions Bank, as holder of the Zions Claim, will receive substantial interim payments on the Zions Claim as and when portions of the First Parcel are sold by 4 Independence totaling approximately $3,648,000 by no later than 24 months after the Effective Date. The Debtor also will attempt to pay down the Zions Claim from sources other than the Zions Collateral, including attempting to sell other real property of the Debtor that is not part of the Zions Collateral, and will pay to Zions Bank, in order to further reduce the balance of the Zions Claim, at least 75% of the net cash proceeds realized by the Debtor from any sale until the Zions Claim is fully paid. Under the Plan, Zions Bank cannot take any enforcement action, including but not limited to foreclosure, with respect to the Zions Trust Deed and its Lien unless the Zions Claim is not fully paid within 60 months after the Effective Date. As an alternative to the treatment of the Zions Claim, Zions Bank may elect to receive title from the Debtor on the Effective Date to up to 80 acres of the Zions Collateral on the Effective Date as full payment of the Zions Claim and in exchange for a full release of the Zions Trust Deed, with the location of that acreage to be determined by the Debtor and Zions Bank with the written consent of 4 Independence, which consent will not be unreasonably withheld, as specified in the Sale/Option Agreement. Class 2 under the Plan consists of the Porter's Point LLC Claim and any other General Unsecured Claims that may exist. Allowed Claims in Class 2 will be paid in full by the Debtor after the Zions Claim has been paid in full, or will be paid as agreed by the Debtor and the holder of any such Claim if the parties agree to a compromise of the Claim that is approved by the Bankruptcy Court on or prior to the Effective Date. The source of funds for the payment of Class 2 Claims will be all unencumbered funds of the Debtor, specifically including the net proceeds of sales of the Debtor's real property pursuant to the Sale/Option Agreement after full payment of the Zions Claim. After the Allowed amount of the Porter's Point Claim has been determined by the Bankruptcy Court, and after the Zions Claim has been paid in full, the Porter's Point Claim will be paid as and when the Debtor receives net proceeds from additional sales of its Real Property until the full amount of the Allowed Class 2 Claims have been paid. Class 3 under the Plan consists of the Equity Interests in the Debtor. Each record holder of an Equity Interest will retain its interest in the Debtor, as the Reorganized Debtor, on and after the Effective Date. The Debtor may make distributions to the holders of Equity Interests on account of their Equity Interests only (i) after all Allowed Claims have been paid in full or (ii) if all Allowed Claims other than the Allowed amount of the Porter's Point Claim have been paid in full, as and when agreed to by the Debtor and Porter's Point pursuant to any agreement approved by the Bankruptcy Court between the Debtor and Porter's Point; provided, however, that the Debtor will be entitled to reimburse such holders for any income tax liabilities which directly arise from taxable income generated by the Reorganized Debtor. In the event the Bankruptcy Case were to be converted to a case under Chapter 7 of the Bankruptcy Code, the Debtor would be required to cease all operations, and a Chapter 7 trustee would be appointed to liquidate the estate's assets. The Debtor's primary assets are the Real Property, which was recently appraised at $22,000,000. Thus, the Debtor believes there is ample value in the Estate to fully pay all Allowed Claims. However, because a Chapter 7 trustee would likely attempt to sell the Real Property quickly at a discounted price that would be significantly less than the consideration to be received under the Sale/Option Agreement to approved as part of Plan confirmation, a Chapter 7 liquidation would likely result in recoveries for unsecured creditors' recoveries far less than what is proposed under the Plan and Sale/Option Agreement. Therefore, the Debtor believes the Plan is in the best interest of its creditors. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/MTJORDAN_disclosurestatement.pdf About Mt. Jordan Mt. Jordan Limited Partnership, in Draper, Utah, filed for Chapter 11 bankruptcy (Bankr. D. Utah Case No. 10-37050) on Dec. 9, 2010, Judge R. Kimball Mosier presiding. Steven C. Strong, Esq. -- scs@pkhlawyers.com -- at Parsons Kinghorn Harris PC, serves as bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. NAPA HOME: Files for Bankruptcy Amid Recall; Mulls Asset Sale ------------------------------------------------------------- Katy Stech, writing for Dow Jones' Daily Bankruptcy Review, reports that Georgia-based Napa Home & Garden Inc., a home-decor distributor that made sold bottled burnable candle fuel has filed for Chapter 11 bankruptcy protection, facing dozens of lawsuits by burn victims. According to the June 27 edition of the CLASS ACTION REPORTER, the U.S. Consumer Product Safety Commission, in cooperation with Napa Home & Garden, of Duluth, announced a voluntary recall of about 460,000 bottles and jugs of pourable NAPAfire and FIREGEL Gel Fuel. The pourable gel fuel can ignite unexpectedly and splatter onto people and objects nearby when it is poured into a firepot that is still burning. This hazard can occur if the consumer does not see the flame or is not aware that the firepot is still ignited. Fuel gel that splatters and ignites can pose fire and burn risks to consumers. Napa is aware of 37 reports of incidents, including 23 burn injuries to consumers. According to DBR, the company's bankruptcy filing on Tuesday shows that it plans to sell itself through a court-supervised auction. Teters Floral Products Inc. of Missouri has offered $1.1 million. The bankruptcy filing automatically halts ongoing lawsuits and prevents new ones without special court permission, DBR notes. Existing and future lawsuits would continue against what remains of Napa Home & Garden's bankruptcy estate once the sale closes. NEAL QUIGLEY: Car Dealer's Debt Non-Dischargeable ------------------------------------------------- Bankruptcy Judge Dennis Michael Lynn ruled that Country Ford- Mercury, Inc.'s $35,243.12 claim against Neal Matthew Quigley is nondischargeable in his bankruptcy case pursuant to 11 U.S.C. Sec. 523(a)(2)(A) as a result of his materially false representations to the Plaintiff. Neal Quigley obtained three vehicles from the Plaintiff in 2008. The case is Country Ford-Mercury, Inc., v. Neal Matthew Quigley, Adv. Proc. No. 09-4364 (Bankr. N.D. Tex.). A copy of Judge Lynn's July 5, 2011 Findings of Fact and Conclusions of Law is available at http://is.gd/CFvvbvfrom Leagle.com. Neal Matthew Quigley filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case No. 09-43357) in 2009. NORTEL NETWORKS: AAI Urges Antitrust Probe of Patent Deal --------------------------------------------------------- Jacqueline Bell at Bankruptcy Law360 reports that the American Antitrust Institute urged U.S. regulators Wednesday to probe the pending $4.5 billion purchase of bankrupt Nortel Networks Corp.'s coveted patent portfolio by a consortium of tech giants including Apple Inc., Microsoft Corp. and Sony Corp. After a four-day auction that concluded on Thursday, a consortium emerged as the winning bidder with a cash purchase price of US$4.5 billion for the remaining patent portfolio of Nortel Networks Inc. The consortium, identified as Rockstar Bidco, LP, consists of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The significant interest from tech firms for the patents raised the price to five times Google Inc.'s opening bid of $900 million. Ranger Inc., the entity formed by Google, as the stalking horse bidder, will receive at least $25 million as "break-up fee". A joint hearing before courts in the United States and Canada will be held July 11 to formally approve the sale. Nortel will work diligently with the consortium to close the sale in the third quarter of 2011. A copy of the Rockstar Bidco Asset Purchase Agreement is available at http://bankrupt.com/misc/RockStar_BidCo_APA.pdf About Nortel Networks Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel Networks divested off key assets while in Chapter 11. In March 2009, the U.S. Bankruptcy Court entered an order approving the sale of the Layer 4-7 assets to Radware Ltd. as the successful bidder at auction. In July 2009, Nortel sold its CDMA and LTE-related assets to Telefonaktiebolaget LM Ericsson (Publ). In September 2009, the Court Nortel sold its Enterprise Solutions business to Avaya Inc. In October 2009, the Court approved the sale of assets associated with Nortel's Next Generation Packet Core network components to Hitachi, Ltd. On Dec. 2, 2009, the Court approved the sale of assets associated with Nortel's GSM/GSM-R business to Telefonaktiebolaget LM Ericsson (Publ) and Kapsch Carriercom AG. In December 2009, the Debtors sold their Metro Ethernet Networks business to Ciena Corporation. In March 2010, Nortel sold its Carrier Voice Over IP and Application Solutions business to GENBAND Inc. In September 2010, Nortel sold its Multi-Service Switch business to Ericsson. Nortel Networks filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. NORTHERN BERKSHIRE: Wants to Hire Carl Marks as Financial Advisor ----------------------------------------------------------------- Northern Berkshire Healthcare, Inc., et al., ask the U.S. Bankruptcy Court for the District of Massachusetts for permission to employ Carl Marks Advisory Group LLC as financial advisor. CMAG will, among other things: -- advise the Debtors regarding any potential strategic or financial investors that would be willing to work with the Debtors to fund their restructuring plans; -- interface and meet with major parties-in-interest, including the bondholders, any creditors' committee, and the Pension Benefit Guaranty Corporation; and -- provide any customary, routine, or incidental litigation support services as may be requested by the Debtors from time to time. Prepetition, the Debtors paid CMAG amounts totaling $175,000, $75,000 of which was applied by CMAG in payment of compensation and reimbursement of expenses incurred prepetition, and $100,000 of which constituted advance payments. CMAG is holding a retainer totaling $100,000, which is to be applied by CMAG in payment of compensation and reimbursement of expenses incurred in the future. The Debtors will pay CMAG a fixed monthly fee of $75,000 for the first two months (starting May 13, 2011) and $50,000 beginning with the third and each subsequent monthly period thereafter. In addition, upon the consummation of (i) a transaction or transactions that together constitute a sale of all or substantially all of the Debtors' assets or (ii) a confirmed chapter 11 plan, to the extent such transaction occurs on or before Feb. 13, 2011, CMAG will be due a completion fee of $500,000. To the best of the Debtors' knowledge, CMAG is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Northern Berkshire Healthcare Northern Berkshire Healthcare, Inc. is a non-profit healthcare corporation in northern Berkshire County, Massachusetts. Together with its affiliates, Northern Berkshire Healthcare operates the North Adams Regional Hospital and a visiting nurse association and hospice in North Adams, Massachusetts. Northern Berkshire Healthcare, Inc., North Adams Regional Hospital, Inc., Visiting Nurse Association & Hospice of Northern Berkshire, Inc., Northern Berkshire Healthcare Physicians Group, Inc., and Northern Berkshire Realty, Inc., filed for Chapter 11 bankruptcy (Bankr. D. Mass. Case No. 11-31114) on June 13, 2011, to address their overleveraged balance sheet and effect a reorganization of their operations. On the same day, Northern Berkshire Community Services, Inc., filed a petition for Chapter 7 relief also in the District of Massachusetts bankruptcy court. Judge Henry J. Boroff presides over the Debtors' cases. James Addison Wright, III, Esq., and Steven T. Hoort, Esq., at Ropes & Gray LLP, serve as the Debtors' bankruptcy counsel. The Debtors' Financial Advisors are Carl Marks Advisory Group LLC. GCG Inc. serves as claims and noticing agent. Northern Berkshire disclosed $22,957,933 in assets and $53,379,652 in liabilities as of the Chapter 11 filing. The petition was signed by William F. Frado, Jr., president. William K. Harrington, the U.S. Trustee for Region 1, appointed five members to the official unsecured creditors' committee in the Debtors' cases. The Committee tapped Duane Morris LLP as its counsel. NORTHERN BERKSHIRE: Taps Schwartz Hannum to Handle Labor Matters ---------------------------------------------------------------- Northern Berkshire Healthcare, Inc., et al., ask the U.S. Bankruptcy Court for the District of Massachusetts for permission to employ Schwartz Hannum PC as their special labor counsel. Schwartz Hannum will provide legal services to the Debtors related to labor and employment law, including their union labor contracts, union and collective bargaining agreement related disputes, cases at the Massachusetts Commission Against Discrimination and the National Labor Relations Board, other similar matters, and related labor and employment issues. The Debtors relate that Schwartz Hannum will complement, rather than duplicate, the services Ropes & Gray LLP, their proposed bankruptcy counsel, will perform. The principal attorneys designated to represent the Debtors and their standard hourly rates are: William E. Hannum III, Esq. $365 Todd A. Newman, Esq. $340 Brian D. Carlson $300 Paul Dubois $220 To the best of the Debtors' knowledge, Schwartz Hannum is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Northern Berkshire Healthcare Northern Berkshire Healthcare, Inc. is a non-profit healthcare corporation in northern Berkshire County, Massachusetts. Together with its affiliates, Northern Berkshire Healthcare operates the North Adams Regional Hospital and a visiting nurse association and hospice in North Adams, Massachusetts. Northern Berkshire Healthcare, Inc., North Adams Regional Hospital, Inc., Visiting Nurse Association & Hospice of Northern Berkshire, Inc., Northern Berkshire Healthcare Physicians Group, Inc., and Northern Berkshire Realty, Inc., filed for Chapter 11 bankruptcy (Bankr. D. Mass. Case No. 11-31114) on June 13, 2011, to address their overleveraged balance sheet and effect a reorganization of their operations. On the same day, Northern Berkshire Community Services, Inc., filed a petition for Chapter 7 relief also in the District of Massachusetts bankruptcy court. Judge Henry J. Boroff presides over the Debtors' cases. James Addison Wright, III, Esq., and Steven T. Hoort, Esq., at Ropes & Gray LLP, serve as the Debtors' bankruptcy counsel. The Debtors' Financial Advisors are Carl Marks Advisory Group LLC. GCG Inc. serves as claims and noticing agent. Northern Berkshire disclosed $22,957,933 in assets and $53,379,652 in liabilities as of the Chapter 11 filing. The petition was signed by William F. Frado, Jr., president. William K. Harrington, the U.S. Trustee for Region 1, appointed five members to the official unsecured creditors' committee in the Debtors' cases. The Committee tapped Duane Morris LLP as its counsel. NOVEMBER 2005: Case Summary & 3 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: November 2005 Land Investors, LLC 5430 LBJ Freeway, Suite 800 Dallas, TX 75240 Bankruptcy Case No.: 11-20704 Chapter 11 Petition Date: July 6, 2011 Court: U.S. Bankruptcy Court District of Nevada (Las Vegas) Judge: Mike K. Nakagawa Debtor's Counsel: James D. Greene, Esq. GREENE INFUSO, LLP 3030 South Jones Boulevard, Suite 101 Las Vegas, NV 89146 Tel: (702) 570-6000 Fax: (702) 463-8401 E-mail: jgreene@greeneinfusolaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $100,000,001 to $500,000,000 The petition was signed by Nathan Barber, assistance chief restructuring officer of BOPH, Inc. Affiliate that simultaneously sought Chapter 11 protection: Debtor Case No. ------ -------- NLV Holding, LLC 11-20707 Debtor's List of three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hillwood Development Group -- -- 5430 LBJ Freeway, Suite 800 Dallas, TX 75240 Hillwood Residential Services -- -- 5430 LBJ Freeway, Suite 800 Dallas, TX 75240 Wilmington Trust FSB Fees and Expenses -- 50 South Sixth Street, Suite 1290 Related to Loan Minneapolis, MN 55402 PALM HARBOR: Taps Bifferato Gentilotti as Special Counsel --------------------------------------------------------- BankruptcyData.com reports that Palm Harbor Homes filed with the U.S. Bankruptcy Court a motion a motion to retain Bifferato Gentilotti (Contact: Garvan F. McDaniel) as special conflicts counsel at the following hourly rates: member and associate at $275 to $345 and paralegal and legal assistant at $150 to $195. About Palm Harbor Homes Addison, Texas-based Palm Harbor Homes, Inc. -- http://www.palmharbor.com/-- manufactured and marketed factory- built homes. The Company marketed nationwide through vertically integrated operations, encompassing manufactured and modular housing, financing and insurance. Palm Harbor, along with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 10-13850) on Nov. 29, 2010. It disclosed $321,263,000 in total assets and $280,343,000 in total debts. Brian Cejka at Alvarez & Marsal is the Debtors' chief restructuring officer. Raymond James and Associates, Inc., is the Debtors' investment banker. Alvarez & Marshal North America, LLC, is the Debtors' financial advisor. BMC Group, Inc., is the Debtors' claims agent. Pachulski Stang Ziehl & Jones LLP serves as counsel to the Official Committee of Unsecured Creditors. Following a court-approved sale process, Palm Harbor in March 2011 sold its business for $85.25 million to Fleetwood Enterprises Inc., a venture between Cavco Industries Inc. and a fund advised by Third Avenue Management LLC. Fleetwood is providing up to $55 million in secured financing for Palm Harbor's reorganization. As reported in the TCR on May 16, 2011, Cavco Industries and Fleetwood Homes filed with the U.S. Bankruptcy Court for the District of Delaware a motion for an order enforcing and ordering Palm Harbor Homes to perform its obligations under the Court- approved amended and restated asset purchase agreement and to pay administrative expenses. According to Cavco and Fleetwood, the Debtors ceased paying former employees' sales commissions and profit-sharing bonuses prior to the closing date when the individuals were still employees of the Debtors. No trustee has been appointed in the Debtors' cases. PERKINS & MARIE: U.S. Trustee Appoints 7-Member Creditor's Panel ---------------------------------------------------------------- Roberta A. Deangelis, United States Trustee for Region 3, under 11 U.S.C. SEC 1102(a) and (b), appointed seven unsecured creditors to serve on the Official Committee of Unsecured Creditors of Perkins & Marie Callender's Inc. The Creditors Committee members are: 1. The Coca-Cola Company ATTN: Joseph Johnson, Esq., PO Box 1734 Mailstop NAT 2008, Atlanta GA 30313, Tel: (404) 676-4150 Fax: (404) 598-4150 2. Wilmington Trust Company ATTN: Patrick J. Healy Rodney Square North, 1100 North Market Street Wilmington DE 19890 Tel: (302) 636-6391 Fax: (302) 636-4149 3. Standard General Master Fund LP ATTN: Soo Kim 650 Madison Avenue, 23rd Floor, New York, NY 10022 Tel: (212) 610-9175 Fax: (212) 610-9094 4. News America Marketing ATTN: Joseph M Borrow 20 Westport Road Wilton CT 06897 Tel: (203) 563-6304 Fax: (203) 563-6736 5. Luna Family Trust ATTN: Ingrid Meno 9274 Camino Paz Lane La Mesa CA 91941 Tel: (619) 469-1831 6. Northgate Station, LP ATTN: David F. Wilson PO Box 6770, Ketchum ID 83340 Tel: (208) 726-9776 Fax: (208) 726-1419 7. Benjamin Monroy 5344 E. Audrie Avenue Fresno CA 93727 Tel: (559) 790-2082 About Perkins & Marie Callender's Inc. Based in Memphis, Tennessee, Perkins & Marie Callender's Inc., fka The Restaurant Company, is the owner or franchiser of nearly 600 family-dining restaurants, the Perkins Restaurants and Marie Callender's. Perkins & Marie and several affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-11795) on June 13, 2011. Perkins & Marie disclosed $290 million in assets and $441 million in debt as of the Chapter 11 filing. Judge Kevin Gross presides over the case. Robert S. Brady, Esq., and Robert F. Poppiti, Jr., Esq., at Young, Conaway, Stargatt & Taylor, LLP; and Mitchel H. Perkiel, Esq., Hollace T. Cohen, Esq., and Brett D. Goodman, Esq., at Troutman Sanders, LLP, serve as bankruptcy counsel. The Debtors' financial advisors are Whitby, Santarlasci & Company. Their claims agent is Omni Management Group, LLC. DIP lender Wells Fargo is represented by lawyers at Paul, Hastings, Janofsky & Walker LLP. PERKINS & MARIE: Wants to Reject Pepsi Beverage Agreement --------------------------------------------------------- Perkins & Marie Callender's Inc. and its affiliates ask the U.S. Bankruptcy Court for the District of Delaware for authority to reject a Fountain Beverage Sales Agreement dated October 4, 2002, between the Pepsi-Cola Company and Debtor Marie Callender Pie Shops, Inc. The Debtors have determined that good business reasons exist to reject the Pepsi Agreement as part of their Chapter 11 efforts to preserve and maximize estate value and to optimize business operations and performance. After careful consideration, the Debtors have concluded that a continued relationship with Pepsi-Cola under the terms of the Pepsi Agreement will not benefit the Debtors' estates and will, in fact, hinder the Debtors' attempts at a successful and expeditious reorganization. This decision is based upon the fact that: (i) the equipment under the Pepsi Agreement is more than eight years old and is in such disrepair as to require replacement; and (ii) substantially all of the rebates, funding and other marketing support provided under the Pepsi Agreement has expired or been eliminated. Robert F. Poppiti, Jr., of Young Conaway Stargatt & Taylor LLP, proposed counsel to Perkins & Marie, notes that the Debtors are not likely to meet certain purchase requirements set forth in the Pepsi Agreement, have been offered significantly superior terms for nearly identical fountain beverage services to those provided under the Pepsi Agreement by an alternate vendor, and have considered the substantial benefit of synchronizing fountain beverage products across both the Perkins and Marie Callender's brands. About Perkins & Marie Callender's Inc. Based in Memphis, Tennessee, Perkins & Marie Callender's Inc., fka The Restaurant Company, is the owner or franchiser of nearly 600 family-dining restaurants, the Perkins Restaurants and Marie Callender's. Perkins & Marie and several affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-11795) on June 13, 2011. Perkins & Marie disclosed $290 million in assets and $441 million in debt as of the Chapter 11 filing. Judge Kevin Gross presides over the case. Robert S. Brady, Esq., and Robert F. Poppiti, Jr., Esq., at Young, Conaway, Stargatt & Taylor, LLP; and Mitchel H. Perkiel, Esq., Hollace T. Cohen, Esq., and Brett D. Goodman, Esq., at Troutman Sanders, LLP, serve as bankruptcy counsel. The Debtors' financial advisors are Whitby, Santarlasci & Company. Their claims agent is Omni Management Group, LLC. DIP lender Wells Fargo is represented by lawyers at Paul, Hastings, Janofsky & Walker LLP. PMI MORTGAGE: S&P Affirms 'B-' Counterparty Credit Rating --------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' counterparty credit and financial strength ratings on PMI Mortgage Insurance Co. and its 'CCC-' counterparty credit rating on PMI's holding company: The PMI Group Inc. Standard & Poor's also said that it removed all of these ratings from CreditWatch, where they were placed on June 14, 2011, with negative implications. The outlook is negative. "We took the ratings off CreditWatch negative based on our analysis of PMI's adverse first-quarter earnings, our forecast of its operating losses for 2011 and 2012, and management's capital initiatives," explained Standard & Poor's credit analyst Miles Kaschalk. "We are now comfortable that PMI's statutory capital is sufficient to keep the group solvent through at least the second quarter of 2012." "The outlook on PMI is negative as a result of our expectation that adverse loss experience will continue to pressure statutory capital throughout 2011 and 2012. Therefore, PMI might be subject to a downgrade of one or more notches over the coming quarters. We would lower the PMI ratings if we expect statutory insolvency or a regulatory takeover within 12 months," S&P related. "We do not anticipate that the holding company will have any near- term liquidity issues in servicing its debt. With the full payment of the QBE note to be received in September 2011, PMI will be able to meet the fourth-quarter 2011 $50 million outstanding on the credit facility. The next maturity of $250 million does not come due until 2016. Like with PMI, we continue to carefully monitor results across the sector on a quarterly basis. We will take rating actions when there are significant adverse deviations from our forecasts," S&P added. POINT BLANK: Outside Directors Settling With SEC ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that three former outside directors for Point Blank Solutions Inc. made an offer to settle claims by the Securities and Exchange Commission that they aided and abetted a fraud perpetrated by founder and former Chief Executive David Brooks. The directors are Jerome Krantz, Cary Chasin and Gary Nadelman. Mr. Rochelle relates that Brooks was convicted in September by a federal jury in Central Islip, New York, for orchestrating a $185 million fraud. The jury deliberated for six weeks following a six-month trial. Sandra Hatfield, the former chief operating officer, was also convicted. About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-11255) on April 14, 2010. Laura Davis Jones, Esq., Alan J. Kornfeld, Esq., David M. Bertenthal, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. T. Scott Avila of CRG Partners Group LLC is the restructuring officer. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. Ian Connor Bifferato, Esq., and Thomas F. Driscoll III, Esq., at Bifferato LLC; and Carmen H. Lonstein, Esq., Andrew P.R. McDermott, Esq., and Lawrence P. Vonckx, Esq., at Baker & McKenzie LLP, serve as counsel for the Official Committee of Equity Security Holders. Robert M. Hirsh, Esq., and George P. Angelich, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at the Rosner Law Group LLC, serve as co-counsel. QUANTUM FUEL: E&Y Raises Going Concern Doubt; Bankruptcy Possible ----------------------------------------------------------------- Quantum Fuel Systems Technologies Worldwide, Inc., filed on July 5, 2011, its annual report on Form 10-K for the fiscal year ended April 30, 2011. Ernst & Young LLP, in Orange County, California, noted that Quantum Fuel's recurring losses and negative cash flows combined with the Company's existing sources of liquidity and other conditions raise substantial doubt about its ability to continue as a going concern. The Company reported a net loss of $11.03 million on $20.27 million of revenues for fiscal year 2011, compared with a net loss of $46.29 million on $9.61 million of revenues for fiscal year 2010. The Company's balance sheet at March 31, 2011, showed $71.97 million in total assets, $33.39 million in total liabilities, and stockholders' equity of $38.58 million. May Seek Bankruptcy Protection The Company anticipates that it will need to raise a significant amount of debt or equity capital in the near future in order to repay certain obligations owed to its senior secured lender when they mature. As of June 15, 2011, the total amount owing to the Company's senior secured lender was approximately $15.5 million, which includes approximately $12.5 million of principal and interest due under three convertible promissory notes that are scheduled to mature on Aug. 31, 2011, and a $3.0 million term note that is potentially payable in cash upon demand beginning on Aug. 1, 2011, if the Company's stock is below $10.00 at the time demand for payment is made. "If we are unable to raise sufficient capital to repay these obligations at maturity and we are otherwise unable to extend the maturity dates or refinance these obligations, we would be in default," the Company said in the filing. "Upon a default, our senior secured lender would have the right to exercise its rights and remedies to collect, which would include foreclosing on our assets. Accordingly, a default would have a material adverse effect on our business and, if our senior secured lender exercises its rights and remedies, we would likely be forced to seek bankruptcy protection." A copy of the Form 10-K is available at http://is.gd/k4wN86 Irvine, Calif.-based Quantum Fuel Systems Technologies Worldwide, Inc., is a fully integrated alternative energy company and a leader in the development and production of advanced clean propulsion systems and renewable energy generation systems and services. QUANTUM FUEL: To Sell 6,996 Common Stock Units for $2.18 Million ---------------------------------------------------------------- Quantum Fuel Systems Technologies Worldwide, Inc., on July 1, 2011, entered into Subscription Agreements with certain "accredited investors", as that term is defined in Rule 501(a) of Regulation D under the United States Securities Act of 1933, as amended, for the purchase and sale of approximately 6,996 common stock units. Each full Unit will consist of 100 shares of the Company's common stock and a warrant to purchase up to 60 additional shares of the Company's common stock. The purchase price for each full Unit will be $3.12. The transaction is expected to close on July 5, 2011. Upon closing, the Company will receive gross proceeds of $2,182,601 and will issue 699,548 shares of common stock and Warrants entitling the Investors to purchase a maximum of 419,729 shares of the Company's common stock. The Investor Warrants will have an exercise price of $3.85 per share, will not be exercisable for six months, have a five year term and contain standard anti-dilution provisions. The Investor Warrants will permit cashless exercise unless the resale of the shares underlying the Warrants have been registered under the Securities Act, in which case, they must be exercised for cash. Upon closing, the Company will pay its placement agent a cash fee of $152,782 and will issue the placement agent a warrant to purchase up to 94,348 shares of common stock at an exercise price of $3.85 per share, for services rendered in connection with the transactions. The Placement Agent Warrant will not be exercisable for six months following the date of issuance, have a term of seven years, permit the holder to exercise on a cashless basis and contains standard anti-dilution provisions. The Company, the Investors and the Placement Agent will also enter into a Registration Rights Agreement pursuant to which the Company will agree to file a registration statement within 30 calendar days of closing to register the resale of the shares of common stock acquired by the Investors at closing, and to register the resale of the shares issuable upon exercise of the Investor Warrants and the Placement Agent Warrant. A full-text copy of the filing is available for free at: http://is.gd/Tm81jb About Quantum Fuel Based in Irvine, California, Quantum Fuel Systems Technologies Worldwide, Inc., is a fully integrated alternative energy company and considers itself a leader in the development and production of advanced clean propulsion systems and renewable energy generation systems and services. Quantum Fuel and its senior lender, WB QT, LLC, entered into a Ninth Amendment to Credit Agreement and a Forbearance Agreement on Jan. 3, 2011. The Senior Lender agreed to provide the Company with a $5.0 million non-revolving line of credit, which may be drawn upon at any time prior to April 30, 2011. Advances under the New Line of Credit do not bear interest -- unless an event of default occurs, in which case the interest rate would be 10% per annum -- and mature on April 30, 2011. The Senior Lender also agreed to forbear from accelerating the maturity date for any portion of the Senior Debt Amount and from exercising any of its rights and remedies with respect to the Senior Debt Amount until April 30, 2011. The Company reported a net loss attributable to stockholders of $11.03 million on $20.27 million of total revenue for the year ended Apri1 30, 2011, compared with a net loss attributable to stockholders of $46.29 million on $9.60 million of total revenue during the prior year. The Company's balance sheet at April 30, 2011, $71.97 million in total assets, $33.39 million in total liabilities and $38.57 million in total equity. Ernst & Young LLP, in Orange County, California, noted that Quantum Fuel's recurring losses and negative cash flows combined with the Company's existing sources of liquidity and other conditions raise substantial doubt about the Company's ability to continue as a going concern. Possible Bankruptcy The Company anticipates that it will need to raise a significant amount of debt or equity capital in the near future in order to repay certain obligations owed to the Company's senior secured lender when they mature. As of June 15, 2011, the total amount owing to the Company's senior secured lender was approximately $15.5 million, which includes approximately $12.5 million of principal and interest due under three convertible promissory notes that are scheduled to mature on Aug. 31, 2011, and a $3.0 million term note that is potentially payable in cash upon demand beginning on Aug. 1, 2011, if the Company's stock is below $10.00 at the time demand for payment is made. If the Company is unable to raise sufficient capital to repay these obligations at maturity and the Company is otherwise unable to extend the maturity dates or refinance these obligations, the Company would be in default. The Company said it cannot provide any assurances that it will be able to raise the necessary amount of capital to repay these obligations or that it will be able to extend the maturity dates or otherwise refinance these obligations. Upon a default, the Company's senior secured lender would have the right to exercise its rights and remedies to collect, which would include foreclosing on the Company's assets. Accordingly, a default would have a material adverse effect on the Company's business and, if the Company's senior secured lender exercises its rights and remedies, the Company would likely be forced to seek bankruptcy protection. RADIANSE INC: Dist. Court Affirms Ruling Versus' Royalty Claim -------------------------------------------------------------- District Judge Richard G. Stearns affirmed a bankruptcy court ruling that says Radianse, Inc., is not obligated to pay Versus Technology, Inc., royalties pursuant to a third-party Reseller Agreement. Versus, which develops and markets location systems for healthcare institutions, contends that Radianse's receipt of a $2.99 million product prepayment from Hill-Rom Company Inc. constituted a "Net Sale," entitling it to an $89,999.70 royalty, which was due upon Radianse's receipt of the Prepayment. Versus maintains that the definition of "Net Sales" in the Versus License "broadly encompasses payments made for future shipments, whether or not they occurred." Versus argues Radianse is not exempted from paying a royalty on the Prepayment "simply because Hill-Rom never issued a purchase order and Radianse never had to ship product." The Versus License provides that Versus is entitled to a 3% royalty payment on "the Net Sales of the Licensed Products." "Net Sales" is defined as "the gross amount received by [Radianse] for the sale or transfer for value of Royalty Products," less certain costs and expenses such as taxes, customs duties, transportation costs, credits, rebates, and refunds. Under the Reseller Agreement, "[t]itle to Radianse Products will and hereby does pass to [Hill-Rom] upon shipment, except that, while the Product Prepayment remains outstanding, title to Custom Radianse Products will and hereby does pass to [Hill-Rom] upon manufacture." The parties do not dispute that Hill-Rom never ordered, and Radianse never manufactured or shipped, any Radianse products to Hill-Rom. Therefore, the District Court pointed out, no transfer of title to products occurred between Radianse and Hill-Rom. In the absence of a transfer of title, the Bankruptcy Court correctly determined that Radianse's transaction with Hill-Rom was not a "sale" as contemplated by the Versus License, and thus Radianse had no obligation to pay a Prepayment royalty to Versus, the District Court held. A copy of Judge Stearns' July 1, 2011 Memorandum and Order is available at http://is.gd/4mTrQgfrom Leagle.com. The case is Versus Technology, Inc., Appellant, v. Craig R. Jalbert, Liquidating Trustee of Radianse, Inc., Appellee, Civil Action No. 11-CV-40008 (D. Mass.). About Radianse Inc. Radianse Inc., headquartered in Andover, Massachusetts, sold real- time location systems technology, designed to track medical equipment, patients, and staff, to hospitals and other healthcare providers. Radianse filed for Chapter 11 bankruptcy (Bankr. D. Mass. Case No. 10-41930) on April 20, 2010. Judge Melvin S. Hoffman presides over the case. Kenneth S. Leonetti, Esq. -- kleonett@foleyhoag.com -- at Foley Hoag LLP, serves as bankruptcy counsel. In its petition, the Debtor estimated assets and debts of $1 million to $10 million. RADLAX GATEWAY: Can Use Cash Collateral Until Oct. 12 ------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Illinois issued a 12th interim order for RadLAX Gateway Hotel, LLC, and its debtor-affiliates to: -- use Radisson Hotel at Los Angeles Airport's rooms revenues and food and beverage revenues in which the lender has an interest; and -- grant adequate protection to a secured lender. A further hearing on the Debtors' use of cash collateral is set For Oct. 12, 2011, at 10:30 a.m. Objections, if any, are due on Oct. 7, 2011. As of the petition date, the Debtor and RadLAX Gateway Deck, LLC, owed in excess of $120 million on account of the construction loan from Amalgamated Bank, as trustee of the Longview Ultra I Construction Loan Investment Fund, in its capacity as administrative agent for itself and San Diego National Bank. The Debtor related that it will use the cash collateral to pay operating expenses of the hotel. As adequate protection to Amalgamated Bank, the Debtor said that the continued operation and maintenance of the hotel will preserve the value of the lender's collateral. The Debtor is not providing the lender with any additional liens. The Debtors' use of cash collateral will expire on the earliest to occur of: (a) Oct. 12, 2011; (b) entry of an order modifying the terms of the interim order; (c) conversion of the Debtors' bankruptcy case to a case under Chapter 7; (d) appointment of a trustee or examiner; and (e) the occurrence of the effective date or consummation of a plan of reorganization. About RadLAX Gateway Hotel Oak Brook, Illinois-based RadLAX Gateway Hotel, LLC, operates a hotel. The Company and its affiliates filed for Chapter 11 on Aug. 17, 2009 (Bankr. N.D. Ill. Case Nos. 09-30047 - 09-30032). David M. Neff, Esq., at Perkins Coie LLP represents the Debtors in their restructuring efforts. RadLAX estimated $50 million to $100 million in assets and up to $500 million in debts. RANDY WALTERS: Files for Chapter 7 Bankruptcy Protection -------------------------------------------------------- Tom Witosky at DesMoinesRegister.com reports that developer Randy Walters has filed for personal bankruptcy less than three months after an unsuccessful attempt to reorganize his commercial real estate business. According to the report, Mr. Walters, a former partner of developer John Kline, filed for liquidation of his debts under Chapter 7 of the Bankruptcy Code last week with estimated assets of $1 million to $10 million and liabilities of $10 million to $50 million. In addition, the bankruptcy petition listed more than 100 creditors, including 37 banks and other lenders. The report says, in April, U.S. Bankruptcy Judge Lee Jackwig dismissed an attempt by Walters to reorganize his company, Griz Lee L.C., under Chapter 11 of the federal bankruptcy code. Judge Jackwig ordered the dismissal after one of Walters' lenders, Community Business Lenders, objected to the filing because the lender had paid $500,000 to cover property taxes that Walters' company had failed to pay. The lender also claimed that any further delay in its foreclosure on property owned by Walters' company would result in the property continuing to lose its value. Mr. Walters' filing provided no detailed accounting of his finances, including his debts. RASER TECHNOLOGIES: Bayard P.A. Approved as Delaware Counsel ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Raser Technologies Inc. and its debtor-affiliates to employ Bayard P.A. as Delaware counsel to provide legal advice with respect to the Debtors' powers and duties as debtor-in-possession in the continued operation of their business and management of their properties. As reported in the Troubled Company Reporter on June 16, 2011, the firm will be paid based on the hourly rates of its professionals: Directors $550 - $840 Associates and Counsel $275 - $550 Legal Assistants $175 - $275 The Debtors assured the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Raser Technologies Raser Technologies Inc. (NYSE: RZ) is a renewable energy company focusing on geothermal power development. The Company has one operating plant in Utah and another eight early and development stage projects in Utah, New Mexico, Nevada and Oregon. The Company invested $120 million in Thermo No. 1, its sole operating plant, which is near Beaver, Utah, and has a power generation capacity of 10 megawatts. The City of Anaheim, California, agreed in 2008 to buy the generated electricity for 20 years. Provo, Utah-based Raser Technologies, Inc., also known as Wasatch Web Advisors, Inc., filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-11315) on April 29, 2011. Other Debtor affiliates filed for separate Chapter 11 protection on April 29, 2011, (Bankr. Case Nos. 11-11319 - 11-11350). Peter S. Partee, Sr., Esq., and Richard P. Norton, Esq., at Hunton & Williams LLP represent the Debtors in their restructuring efforts. The Debtors' local counsel is Bayard, P.A. Sichenzia Ross Friedman Ference LLP serves as the Debtors' corporate counsel. The Debtors' financial advisor is Canaccord Genuity. A three-member official committee of unsecured creditors has been formed in the Chapter 11 case. The Company reported a net loss of $101.80 million on $4.25 million of revenue for the fiscal year ended Dec. 31, 2010, compared with a net loss of $20.90 million on $2.19 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $41.84 million in total assets, $107.78 million in total liabilities, $5.00 million of Series A-1 cumulative convertible preferred stock, and a stockholders' deficit of $70.94 million. RASER TECHNOLOGIES: Committee Taps Services of BDO Professionals ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized the Official Committee of Unsecured Creditors in the Chapter 11 cases of Raser Technologies Inc. and its debtor-affiliates to retain: 1) BDO Consulting, a division of BDO USA, LLP, as its financial advisor and accountant; and 2) BDO Capital Advisors, LLC its investment banker. The Committee relates that the services of the BDO Professionals are necessary to enable the Committee to assess and monitor the efforts of the Debtors and their advisors, including, without limitation, the proposed debtor-in-possession financing, the proposed equity auction process, the marketing of the Debtors' assets and formation of a plan of reorganization. The BDO Professionals will, among other things: a. analyze the financial operations of the Debtors pre- and post-petition, as necessary; b. analyze the financial ramifications of any proposed transactions for which the Debtors seek Bankruptcy Court approval including, but not limited to, debtor-in-possession financing, sale of all or a portion of the Debtors' assets or equity, retention of management or employee incentive and severance plans; c. conduct any requested financial analysis including verifying the material assets and liabilities of the Debtors, as necessary, and their values; and d. assist the Committee in its review of monthly statements of operations submitted by the Debtors. The hourly rates of BDO Professionals are: Partners/Managing Directors $475 - $795 Directors & Sr. Managers $375 - $525 Managers $325 - $425 Seniors $200 - $350 Staff $150 - $225 To the best of the Committee's knowledge, BDO Professionals are "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. About Raser Technologies Raser Technologies Inc. (NYSE: RZ) is a renewable energy company focusing on geothermal power development. The Company has one operating plant in Utah and another eight early and development stage projects in Utah, New Mexico, Nevada and Oregon. The Company invested $120 million in Thermo No. 1, its sole operating plant, which is near Beaver, Utah, and has a power generation capacity of 10 megawatts. The City of Anaheim, California, agreed in 2008 to buy the generated electricity for 20 years. Provo, Utah-based Raser Technologies, Inc., also known as Wasatch Web Advisors, Inc., filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-11315) on April 29, 2011. Other Debtor affiliates filed for separate Chapter 11 protection on April 29, 2011, (Bankr. Case Nos. 11-11319 - 11-11350). Peter S. Partee, Sr., Esq., and Richard P. Norton, Esq., at Hunton & Williams LLP represent the Debtors in their restructuring efforts. The Debtors' local counsel is Bayard, P.A. Sichenzia Ross Friedman Ference LLP serves as the Debtors' corporate counsel. The Debtors' financial advisor is Canaccord Genuity. A three-member official committee of unsecured creditors has been formed in the Chapter 11 case. The Company reported a net loss of $101.80 million on $4.25 million of revenue for the fiscal year ended Dec. 31, 2010, compared with a net loss of $20.90 million on $2.19 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $41.84 million in total assets, $107.78 million in total liabilities, $5.00 million of Series A-1 cumulative convertible preferred stock, and a stockholders' deficit of $70.94 million. RASER TECHNOLOGIES: Court OKs Foley & Lardner as Committee Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court District of Delaware has approved the application of the Official Committee of Unsecured Creditor of Raser Technologies Inc. to retain and employ Foley & Lardner LLP as its counsel. Upon retention, the firm, will among other things: a. advise the Committee with respect to its rights, powers and duties; b. advise the Committee in its consultations with the Debtors relative to the administration of the Chapter 11 Cases; c. advise the Committee in analyzing the claims of the Debtors' creditors and in negotiating with such creditors; The firm's rates are; Personnel Rate --------- ---- Douglas E. Spelfogel Partner $750 per hour Richard J. Bernard Senior Counsel $660 per hour Alissa M. Nann Associate $495 per hour Lars A. Peterson Associate $390 per hour Matthew J. Riopelle Associate $380 per hour Rebecca A. Hayes Associate (Pending) $300 per hour Katherine E. Hall Paralegal $225 per hour Kerry Farrar Paralegal $210 per hour About Raser Technologies Raser Technologies Inc. (NYSE: RZ) is a renewable energy company focusing on geothermal power development. The Company has one operating plant in Utah and another eight early and development stage projects in Utah, New Mexico, Nevada and Oregon. The Company invested $120 million in Thermo No. 1, its sole operating plant, which is near Beaver, Utah, and has a power generation capacity of 10 megawatts. The City of Anaheim, California, agreed in 2008 to buy the generated electricity for 20 years. Provo, Utah-based Raser Technologies, Inc., also known as Wasatch Web Advisors, Inc., filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-11315) on April 29, 2011. Other Debtor affiliates filed for separate Chapter 11 protection on April 29, 2011, (Bankr. Case Nos. 11-11319 - 11-11350). Peter S. Partee, Sr., Esq., and Richard P. Norton, Esq., at Hunton & Williams LLP represent the Debtors in their restructuring efforts. The Debtors' local counsel is Bayard, P.A. Sichenzia Ross Friedman Ference LLP serves as the Debtors' corporate counsel. The Debtors' financial advisor is Canaccord Genuity. A three-member official committee of unsecured creditors has been formed in the Chapter 11 case. The Company reported a net loss of $101.80 million on $4.25 million of revenue for the fiscal year ended Dec. 31, 2010, compared with a net loss of $20.90 million on $2.19 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $41.84 million in total assets, $107.78 million in total liabilities, $5.00 million of Series A-1 cumulative convertible preferred stock, and a stockholders' deficit of $70.94 million. RASER TECHNOLOGIES: Court OKs Womble as Committee Co-Counsel ------------------------------------------------------------ The U.S. Bankruptcy Court for the District Of Delaware has approved the application of the Official Committee of Unsecured Creditor of Raser Technologies Inc. to employ and retain Womble Carlyle Sandridge & Rice, PLLC, as co-counsel. The Committee selected Womble Carlyle because of its extensive experience and knowledge of bankruptcy matters and this Court's Local Rules and practices, and believes Womble Carlyle is well qualified to represent the Committee in these Chapter 11 cases. Upon retention, the firm, will among other things: a) assisting and advising the Committee in its discussions with the Debtors and other parties in interest regarding the overall administration of this case; b) representing the Committee at hearings to be held before this Court and communicating with the Committee regarding the matters heard and the issues raised as well as the decisions and considerations of this Court; c) assisting and advising the Committee in its examination and analysis of the conduct of the Debtors' affairs; Womble Carlyle proposes to render its services on an hourly fee basis according to its customary hourly rates in effect when the services are rendered. It is anticipated that the lead Womble Carlyle attorneys who will represent the Committee are Francis A. Monaco, Jr., Esq. (a member of the firm whose current hourly rate is $625), Michael G. Busenkell, Esq. (a member of the firm whose current hourly rate is $450), and Ericka F. Johnson, Esq. (an associate with the firm whose current hourly rate is $275). Other Womble Carlyle attorneys or paraprofessionals will provide additional supporting legal services on behalf of and as directed by the Committee in connection with the matters herein described. Subject to periodic adjustment, the current hourly rates for Womble Carlyle attorneys range from $210 to $700 per hour and the current hourly rates for paraprofessionals range from $110 to $215 per hour. About Raser Technologies Raser Technologies Inc. (NYSE: RZ) is a renewable energy company focusing on geothermal power development. The Company has one operating plant in Utah and another eight early and development stage projects in Utah, New Mexico, Nevada and Oregon. The Company invested $120 million in Thermo No. 1, its sole operating plant, which is near Beaver, Utah, and has a power generation capacity of 10 megawatts. The City of Anaheim, California, agreed in 2008 to buy the generated electricity for 20 years. Provo, Utah-based Raser Technologies, Inc., also known as Wasatch Web Advisors, Inc., filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-11315) on April 29, 2011. Other Debtor affiliates filed for separate Chapter 11 protection on April 29, 2011, (Bankr. Case Nos. 11-11319 - 11-11350). Peter S. Partee, Sr., Esq., and Richard P. Norton, Esq., at Hunton & Williams LLP represent the Debtors in their restructuring efforts. The Debtors' local counsel is Bayard, P.A. Sichenzia Ross Friedman Ference LLP serves as the Debtors' corporate counsel. The Debtors' financial advisor is Canaccord Genuity. The Company reported a net loss of $101.80 million on $4.25 million of revenue for the fiscal year ended Dec. 31, 2010, compared with a net loss of $20.90 million on $2.19 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $41.84 million in total assets, $107.78 million in total liabilities, $5.00 million of Series A-1 cumulative convertible preferred stock, and a stockholders' deficit of $70.94 million. RCC NORTH: Seeks Approval of Stipulation With Tenant ---------------------------------------------------- RCC North LLC seeks approval of a stipulation agreement with Eye Level Holdings, LLC, in aid of confirmation of its plan of reorganization. The Debtor and Eye Level Holdings, as tenant, are parties to an office lease dated March 28, 2008. As of the Petition Date, the Debtor was obligated to reimburse tenant the amount of $130,346 for tenant improvement expenses. Following the filing of the Plan, tenant chose to exercise its right of refusal with respect to additional space in Phase II. The Debtor agreed to provide tenant with a tenant allowance for tenant improvements to the additional space in the total amount of $74,236.80. In an effort to retain Tenant, the Debtor and Tenant have agreed to adjust their landlord/tenant and mutual creditor/debtor relationships. The terms of the stipulation are: A. As of the effective date of the plan, the lease will be rejected by the Debtor; B. As of the effective date of the plan, the Reorganized Debtor and the tenant will execute and enter into a new lease. D. As of the effective date of the plan, tenant will issue and deliver to the Debtor a promissory note in the amount of $112,5000 in exchange for the Debtor's claim against the Tenant for the underpaid post-petition rent due under the Lease, as amended. The Rent Note will require monthly payments of principal and interest, at the rate of 4% per annum, fully amortized and due and payable on the 2nd anniversary of the Effective Date. E. The Plan will be modified to provide the treatment of tenant's claim against the Debtor in Class 3 of the Plan. F. The Debtor and tenant agree and acknowledge that tenant's Class 3 claim is not an administrative expense and is not entitled to priority. G. The Debtor and the tenant agree and acknowledge that the new treatment of tenant's Claim in Class 3 impairs tenant's Class 3 Claim against the Debtor. H. Tenant is the only holder of a claim in Class 3 of the Plan, and agrees to the alternative treatment of its Class 3 claim. I. To the extent that tenant incurs any damages from the rejection of the Lease, tenant agrees that any claims for such damages are incorporated in treatment of its Class 3 Claim. J. Tenant reaffirms that it accepts the Debtor's Plan and reaffirms its accepting ballot notwithstanding the modification of the Plan's treatment of its Class 3 Claim. About RCC North LLC Scottsdale, Arizona-based RCC North LLC owns and operates two Class A office buildings and the related corporate campuses known as Phase I and Phase II of the Raintree Corporate Center located north of the northeast corner of Loop 101 (Pima Freeway) and Raintree Drive, at 15333 North Pima Road and 15111 North Pima Road, respectively, in Scottsdale, Arizona. The Company filed for Chapter 11 bankruptcy protection on April 15, 2010 (Bankr. D. Ariz. Case No. 10-11078). John J. Hebert, Esq., Mark W. Roth, Esq., and Philip R. Rudd, Esq. at Polsinelli Shughart PC represent the Debtor in its restructuring effort. The Company estimated its assets and debts at $50 million to $100 million in its Chapter 11 petition. RHI ENTERTAINMENT: Halmi Junior Resigns as President and CEO ------------------------------------------------------------ Andrew Wallenstein at Variety reports that Robert Halmi, Jr., has resigned as president and CEO of RHI Entertainment, which recently emerged from Chapter 11 with a plan to reduce its debt by $400 million. According to the report, his father, Robert Halmi, Sr., will remain with the company to continue overseeing production of its miniseries. Also out is COO Peter von Gal. The report says The departure of the junior Halmi splits a father- son team that have spent several decades together atop one of the globe's leading producers of long-form TV programming. RHI has done hundreds of hours of movies and minseries including "Merlin," "Gulliver's Travels" and "Tin Man." About RHI Entertainment New York-based RHI Entertainment, Inc., develops, produces and distribute new made-for-television movies, mini-series and other television programming worldwide. RHI and its affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 10-16536) on Dec. 10, 2010. D.J. Baker, Esq., Rosalie Walker Gray, Esq., Keith A. Simon, Esq., Adam S. Ravin, Esq., and Jude Gorman, Esq., at Latham & Watkins LLP, serve as the Debtors' bankruptcy counsel. Logan & Company, Inc., serves as the Debtors' claims and noticing agent. RHI's First Lien Lenders are represented by Michael A. Chapnick, Esq. -- mchapnick@morganlewis.com -- and Wendy S. Walker, Esq. -- wwalker@morganlewis.com -- at Morgan, Lewis & Bockius LLP, and RHI's Second Lien Lenders are represented by Mark R. Somerstein, Esq. -- mark.somerstein@ropesgray.com -- and Patricia I. Chen, Esq. -- patricia.chen@ropesgray.com -- at Ropes & Gray LLP. The Debtors disclosed $524,722,000 in total assets and $834,094,000 as of the Chapter 11 filing. SATELITES MEXICANOS: Incurs $13.88 Million Net Loss in 2010 ----------------------------------------------------------- Satelites Mexicanos, S.A. DE C.V., filed with the U.S. Securities and Exchange Commission its Annual Report on Form 20-F reporting a net loss of US$13.88 million on US$128.76 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of US$19.74 million on US$125.03 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010, showed US$438.95 million in total assets, US$524.99 million in total liabilities and a US$86.03 million total shareholders' deficit. Galaz, Yamazaki, Ruiz Urquiza, S. C., in Mexico City, Mexico, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that Satmex's working capital deficiency, recurring net losses, shareholders' deficit, inability to generate sufficient cash flow to meet its short-term obligations and sustain its operations raise substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 20-F is available for free at: http://is.gd/1sH9V5 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. As reported in the TCR on June 1, 2011, Satmex disclosed that on May 26, 2011, it officially concluded its reorganization efforts and emerged from its U.S. bankruptcy case. As previously announced, Satmex, together with its subsidiaries, Alterna' TV Corporation and Alterna' TV International Corporation, filed a prepackaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code on April 6, 2011. The Plan was confirmed by the U.S. Bankruptcy Court in the District of Delaware on May 11, 2011, and became effective on May 26, 2011. SEARS HOLDINGS: Has 'B' From Fitch Due to Declining Sales, Loss --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports Sears Holdings Corp. was demoted to a 'B' rating in June by Fitch Ratings as the result of the 80% decline in earnings before interest, taxes, depreciation and amortization in the first quarter. EBITDA in the period was $63 million, Fitch said. According to the report, Fitch attributed the decline in cash flow in part to "chronic underinvestment in the stores due to years of cost cutting." Noting that comparable store sales for Sears have fallen while those of competitors have risen, Fitch projects the decline will continue into 2013. Liquidity remains "adequate," Fitch said, the report relates. In May, Sears announced a $170 million net loss in the April 30 quarter. Standard & Poor's reacted at the time by lowering the corporate grade to B+. Revenue of $9.7 billion in the quarter represented a 3.4% decline from the same quarter last year. Kmart Corp. completed a Chapter 11 reorganization in April 2003 and acquired Hoffman Estates, Illinois-based Sears along with its name in 2005. Revenue in 2010 produced a $133 million net profit, representing a 43% decline from 2009. SEVEN SEAS: Dist. Ct. Doesn't See Impact of MPF Case in CIBC Suit ----------------------------------------------------------------- District Judge Nancy F. Atlas denied the request of CIBC World Markets Corp. to stay proceedings in an action commenced by Seven Seas Petroleum, Inc., pending a decision by the U.S. Court of Appeals for the Fifth Circuit in an unrelated matter. Seven Seas hired CIBC in 2001 to serve as its exclusive financial advisor, to assist in raising additional funds for the company, and to render a fairness opinion in connection with any potential financing transaction. A dispute arose between the parties and, in October 2008, Ben Floyd, then Chapter 11 trustee for Seven Seas, sued CIBC. CIBC moved to dismiss, arguing inter alia that Seven Seas lacked standing to pursue its claims against CIBC, citing Dynasty Oil & Gas, LLC v. Citizens Bank (In re United Operating, LLC), 540 F.3d 351 (5th Cir. 2008). The Court disagreed, holding that "the Reorganization Plan as elucidated by the Disclosure Statement specifically and unequivocally reserved the claims Plaintiff seeks to assert against CIBC." On Jan. 14, 2011, in an unrelated matter, Bankruptcy Judge Jeff Bohm held that the plaintiff in that adversary proceeding lacked standing to pursue his claims. In re MPF Holdings US LLC, Bankruptcy Case No 08-36084. CIBC seeks a stay of the Seven Seas lawsuit pending a decision by the Fifth Circuit on the appeal of Judge Bohm's decision in In re MPF Holdings US LLC, et al., Fifth Circuit Case No. 11-20478. Seven Seas opposes, arguing that any ruling by the Fifth Circuit in the MPF Holdings appeal would not have an impact on the issues in the case. The parties are completing fact discovery and will soon begin discovery of expert witnesses. CIBC argues that it should not be required to expend funds on expert discovery until the Fifth Circuit decides the MPF Holdings appeal. In a June 30, 2011 Memorandum and Order, Judge Atlas said because the requested stay is based on proceedings in an unrelated case, a stay should be granted only in rare circumstances. She said the balancing of the parties' interest does not indicate a clear inequity to CIBC if the stay is not granted. The case was filed almost three years ago, and the Court has already ruled on CIBC's argument that Seven Seas lacks standing. There is no indication how long the appeal will be pending before that court. Indeed, the Fifth Circuit has not issued a briefing schedule or taken any action other than permitting the appeal to proceed directly before the Court of Appeals. Moreover, it is questionable whether the Fifth Circuit's ultimate decision on the MPF Holdings appeal will affect the District Court's prior ruling that Seven Seas has standing to assert its claims. The case is Seven Seas Petroleum, Inc., v. CIBC World Markets Corp., Civil Action No. H-08-3048 (S.D. Tex.). A copy of the Court's decision is available at http://is.gd/sSVFeMfrom Leagle.com. Seven Seas Petroleum Inc. was an oil and gas exploration company operating in Colombia, South America. Seven Seas filed for Chapter 11 protection (Bankr. S.D. Tex. Case No. 02-45206) on Jan. 14, 2003. The Official Committee of Unsecured Creditors retained McClain, Leppert & Maney, P.C. as counsel. Ben B. Floyd was named as Chapter 11 trustee. He was represented by Floyd, Isgur, Rios & Wahrlich, P.C., as his general bankruptcy counsel, and Andrews & Kurth LLP as his special counsel. The Debtor's Second Amended Plan of Reorganization was confirmed Aug. 4, 2003, and declared effective 10 days later. SONJA MORGAN: On The Brink of Losing House Worth $6 Million ----------------------------------------------------------- The Inquisitr reports that Real Housewives of New York City star Sonja Morgan may be on the verge of losing her Upper East Side mansion, valued at $6 million. New York City-based Sonja Tremont-Morgan filed for Chapter 11 protection on Nov. 17, 2010 (Bankr. S.D.N.Y Case No. 10-16132). The Debtor disclosed $13,458,749 in assets and $19,839,501 in liabilities as of the Chapter 11 filing. SOUTHEASTERN MATERIALS: Court Trims Trustee's Suit v. Bank ---------------------------------------------------------- Bankruptcy Judge Thomas W. Waldrep, Jr., granted portions of the request of First Bank to dismiss the lawsuit, W. Joseph Burns, Trustee, v. First Bank, Adv. Proc. No. 10-6059 (Bankr. M.D.N.C.). The bank sought to dismiss all counts of the Amended Complaint. The Court granted the request as to the First Alternative Claim, the Fourth Claim, the Fifth Claim, and the Sixth Claim. The Motion is denied as to all remaining claims. The lawsuit, among others, seeks declaratory judgment as to whether certain advances made by First Bank are secured by a deed of trust recorded in December 1997, whether payments made by Southeastern Materials, Inc., should be reconstituted as payments against a December 1997 promissory note, and whether First Bank's lien under the December 1997 deed of trust is invalid in whole or in part. The lawsuit seeks to equitably subordinate First Bank's claim to the claims of all non-insider creditors, on the basis of First Bank's inequitable conduct. A copy of the Court's July 6, 2011 Memorandum Opinion is available at http://is.gd/bNw4Krfrom Leagle.com. Southeastern Materials, Inc., manufactured wooden roof trusses, shingles, and other roofing materials. The Debtor sought Chapter 11 protection (Bankr. M.D.N.C. Case No. 09-52606) on December 30, 2009. A copy of the Debtor's Chapter 11 petition is available at http://bankrupt.com/misc/ncmb09-52606.pdfat no charge. On June 2, 2010, the Court appointed W. Joseph Burns as Chapter 11 trustee. On July 30, 2010, the case was converted to Chapter 7, and W. Joseph Burns was appointed as the Chapter 7 trustee. SPECIALTY PRODUCTS: Can't Share Privileged Docs, Judge Says ----------------------------------------------------------- Lance Duroni at Bankruptcy Law360 reports that a Delaware bankruptcy judge on Wednesday refused to allow Specialty Products Holding Corp. to share attorney-client privileged information with asbestos claimants investigating potential causes of action against the company's parent, RPM International Inc. According to Law360, the documents at issue relate to the 2002 reorganization of the chemical manufacturer that created RPM. The debtors had sought to share the information while getting assurance from the court that the privileges would not be waived by the disclosure. Cleveland, Ohio-based Specialty Products Holdings Corp., aka RPM, Inc., is a wholly owned subsidiary of RPM International Inc. The Company is the holding company parent of Bondex International, Inc., and the direct or indirect parent of certain additional domestic and foreign subsidiaries. The Company claims to be a leading manufacturer, distributor and seller of various specialty chemical product lines, including exterior insulating finishing systems, powder coatings, fluorescent colorants and pigments, cleaning and protection products, fuel additives, wood treatments and coatings and sealants, in both the industrial and consumer markets. The Company filed for Chapter 11 bankruptcy protection on May 31, 2010 (Bankr. D. Del. Case No. 10-11780). Gregory M. Gordon, Esq., Dan B. Prieto, Esq., and Robert J. Jud, Esq., at Jones Day, serve as bankruptcy counsel. Daniel J. DeFranceschi, Esq., and Zachary I. Shapiro, Esq., at Richards Layton & Finger, serve as co-counsel. Logan and Company is the Company's claims and notice agent. The Company estimated its assets and debts at $100,000,001 to $500,000,000. The Company's affiliate, Bondex International, Inc., filed a separate Chapter 11 petition on May 31, 2010 (Case No. 10-11779), estimating its assets and debts at $100,000,001 to $500,000,000. SPRINGCREST PARTNERS: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Springcrest Partners, LLC 2007 Springcrest Drive Arlington, TX 76010 Bankruptcy Case No.: 11-43848 Chapter 11 Petition Date: July 5, 2011 Court: U.S. Bankruptcy Court Northern District of Texas (Ft. Worth) Judge: D. Michael Lynn Debtor's Counsel: Thomas Craig Sheils, Esq. SHEILS WINNUBST P.C. 1100 Atrium II 1701 N. Collins Boulevard Richardson, TX 75080-1339 Tel: (972) 644-8181 E-mail: craig@sheilswinnubst.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/txnb11-43848.pdf The petition was signed by Zemen Woldberhan, member/manager. THYSSENKRUPP BUDD: Bankruptcy Could Undercut Retiree Benefits ------------------------------------------------------------- Retirees and surviving spouses at the former Kitchener Frame auto parts facility in Kitchener, Ontario are shocked and dismayed following the unexpected corporate bankruptcy filing by ThyssenKrupp Budd Canada Inc. The bankruptcy filing - submitted on July 4 - may compromise the post-retirement health benefits of over 1200 individuals. "The company's decision is a shock and quite disturbing," said CAW President Ken Lewenza. The CAW represents the large majority of retired production, trades and office workers at Kitchener Frame. "You can't tell these folks who have put their blood, sweat and tears into this company for so many years that their retirement health benefits are now in jeopardy and that they are simply out of luck," Lewenza said. "This would leave over one thousand our most vulnerable citizens in the lurch with no ongoing health benefits, including drug benefits." The Kitchener Frame plant, once one of the largest employers in Waterloo region, shut its doors in April 2009, in the throes of the auto industry crisis. At the time of closure, and well before that date, ThyssenKrupp Budd Canada had committed to continue payments for post-retirement benefits - a commitment that may be compromised in bankruptcy proceedings. "The company is saying it is ready to abdicate its responsibility to these former workers and their families," said former CAW Local 1451 President Mike Devine, who is also a retiree at Kitchener Frame. Devine presided over a July 6 meeting at the Bingeman Conference Centre in Kitchener to discuss the company's position with 1000 affected retirees and spouses in attendance. "These people expressed their anger and shock at this decision. They feel betrayed, and rightfully so." At the time of its closure the facility employed 500 CAW members. It manufactured frames for mid-sized sport utility vehicles. At its peak in the 1970s, the plant employed more than 3000 workers. The union is engaged in in-depth discussions with the company and the Bankruptcy Trustee with respect to fashioning a solution that best protects the interests and health care benefits of ThyssenKrupp Canada retirees and surviving spouses. TRIBUNE CO: Wins OK to Hire Ernst & Young as Auditor ---------------------------------------------------- Tribune Co. and its units obtained the Bankruptcy Court's permission to employ Ernst & Young LLP as the accounting firm, as the term is defined in a formation agreement. The Debtors also seek permission from the Court to enter into an engagement letter with Ernst & Young and Ricketts Acquisition. Pursuant to the Formation Agreement dated August 21, 2009 among Rickets Acquisition LLC; RAC Education Trust OCA, LLC; Tribune; Chicago National League Ball Club, LLC; Wrigley Field Premium Ticket Services, LLC; Diana-Quentin, LLC; Tribune Sports Network Holdings, LLC and Chicago Cubs Dominican Baseball Operations, LLC, whereby Chicago Baseball Holdings, LLC was created to effect various transactions. Under the Formation Agreement, the business and assets of the Chicago Cubs Major League Baseball franchise were contributed to New Cubs LLC and certain cash distributions were made to CNLBC. Pursuant to the Formation Agreement, the Debtors and Rickets Acquisition have chosen to retain E&Y to review and resolve certain issues set forth in a notice of disagreement. As the accounting firm, Ernst & Young will: * review and consider initial briefs and relevant data, reports, work papers correspondence, affidavits, exhibits, and others that Tribune and Ricketts Acquisition submit in support of their positions; * review and consider Tribune's and Ricketts Acquisition's rebuttal briefs to the initial submissions, which will be limited in scope to the specific matters or arguments addressed in the other party's initial brief; * submit supplemental questions to Tribune and Ricketts Acquisition; * review and consider the parties' responses to E&Y's supplemental questions; * prepare and issue a final determination letter. The Debtors assure the Court that the dispute resolution services the Engagement Letter contemplates will not be duplicative of those services any of the Debtors' currently-retained professionals provide. The parties will pay E&Y's professionals according to their customary hourly rates: Title Rate per Hour ----- ------------- Partner/Principal/Executive Director $975 Senior Manager $740 Manager $595 Senior $430 Staff $300 E&Y will also be reimbursed for expenses incurred or to be incurred. E&Y will begin work upon receiving a $25,000 retainer from each party that will be applied to the firm's last invoice or refunded to the extent the invoice is less than the amount of the remaining retainer. In connection with the engagement of E&Y to act as the Accounting Firm, Tribune and Ricketts Acquisition have also entered into a Side Letter. The Side Letter provides that while the Parties' obligations to indemnify E&Y under the Engagement Letter are joint and several, Tribune and Ricketts Acquisition agree that as between Tribune and Ricketts Acquisition, each of Tribune and Ricketts Acquisition will bear 50% of the indemnification obligations, provided that in the event a third party initiates a claim that results in indemnification obligations solely on the basis of a relationship with only one of Tribune or Ricketts Acquisition, that party will bear 100% of the indemnification obligation. Gregory E. Wolski, a partner at E&Y, discloses that Foley & Lardner LLP represents Ricketts Acquisition in connection with the proposed engagement. Foley has represented or currently represents E&Y in litigation matters and has represented and currently represents E&Y with respect to bankruptcy retention, and avoidance action issues. All those matters are unrelated to the Debtors and their bankruptcy cases, he says. Moreover, McDermott Will & Emery LLP represents Tribune in connection with the proposed engagement. MWE has provided and currently provides tax advice to E&Y and has represented or currently represents E&Y in matters unrelated to the Debtors, he points out. Mr. Wolski maintains that E&Y remains a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) U.S. POSTAL: To Close Hundreds of Post Offices to Avoid Insolvency ------------------------------------------------------------------ Robby Short at The Shawnee News-Star reports that hundreds, if not thousands, of post offices around the U.S. could soon be closed down as the United States Postal Service looks to cut costs in order to avoid becoming insolvent. "At this time there are no closings identified by Oklahoma District for Pottawatomie, Seminole, Lincoln, and Cleveland County," The Shawnee News-Star quotes Dionne Montague, communications programs specialist for the United States Postal Service (USPS), as saying. According to The Shawnee News-Star, one alternative to closing a Post Office would require consolidating mail sorting operations of several local offices into a central office, while retaining the letter carriers and routes and even some offices, but with reduced function. "The hard-core reality of this, the Post Office lost billions last year," The Shawnee News-Star quotes Congressman James Lankford as saying. "You have to figure out some way to do this and it's not going to be a single solution." The Shawnee News-Star discloses that nine Post Offices have been recommended for closure in Oklahoma, those offices are located in Oklahoma City and Tulsa. A total of 667 have been identified nationwide for possible closure to date, The Shawnee News-Star adds. "This is a national ongoing initiative that could eventually result in as many as 1,000 offices closing nationwide," Mr. Montague said. As reported in the Troubled Company Reporter on May 18, 2011, Bankruptcy Law360 said the U.S. Postal Service said that it lost $2.2 billion for the quarter that ended March 31, warning of defaults on payments to the government if a law forcing it to prepay into a massive employee health fund isn't changed. As an agency under the executive branch, the post office can't technically go bankrupt, but it has to fund its own operations and could become insolvent. That could create havoc inside the federal government and impact its obligations to pay other agencies, according to Law360. USA UNITED: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: USA United Fleet, Inc. aka Shoreline Fleet, Inc. 150 L. Greaves Lane, Suite 412 Staten Island, NY 10308 Bankruptcy Case No.: 11-45867 Chapter 11 Petition Date: July 6, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Jerome Feller Debtor's Counsel: Todd E. Duffy, Esq. ANDERSON KILL & OLICK, P.C. 1251 Avenue of the Americas New York, NY 10020 Tel: (212) 278-1621 E-mail: tduffy@andersonkill.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by William Moran, comptroller. Affiliates that simultaneously sought Chapter 11 protection: Debtor Case No. ------ -------- USA United Holdings, Inc. 11-45868 United Fleet, Inc. 11-45869 United Tom Tom Transportation, Inc. 11-45872 USA United Bus Express, Inc. 11-45873 USA United Transit, Inc. 11-45875 Tom Tom Escorts Only, Inc. 11-45876 Shoreline Transit, Inc. 11-45877 VINEYARD AT SERRA RETREAT: To Hire David W. Meadows as Counsel -------------------------------------------------------------- The Vineyard at Serra Retreat seeks approval from the U.S. Bankruptcy Court Central District of California to employ the law offices of David W. Meadows as counsel. Upon retention, the firm, will among other things: a. Legal advice with respect to the Applicant's duties, responsibilities and powers in the case, with respect to the Bankruptcy Code, the Bankruptcy Rules, the Guidelines of the Office of the United States Trustee, and compliance with the Local Rules of this Court; b. Legal advice with respect to the Debtor's successful sale of the Debtor's fee interests in three (3) Malibu properties and/or the restructuring or refinancing of some or all of its existing obligations, and the confirmation of a chapter 11 plan. c. Performance of such other legal services as may be required by the Applicant. The Vineyard at Serra Retreat, LLC, in Malibu, California, filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-17323) on June 15, 2011. Judge Victoria S. Kaufman presides over the case. The Law Offices of David W. Meadows serves as bankruptcy counsel. In its petition, the Debtor estimated assets and debts of $10 million to $50 million. The petition was signed by John Hall, manager. VITRO SAB: Court OKs E&Y as Tax Advisor for U.S. Units ------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas has approved Vitro America, LLC's application to employ Ernst & Young LLP as tax advisor effective as of April 25, 2011. The firm can be reached at: Kevin L. Chadwell ERNST & YOUNG LLP 6410 Poplar Ave., # 500 Memphis, TN 38119 Phone: (901) 526-1000 E&Y LLP will also assign certain tax professionals to assist the Debtors in completing ministerial and administrative tasks relating to data collection and preparation of Dec. 31, 2010, federal and state tax returns for the Debtors. With respect to the bankruptcy tax services, E&Y LLP will charge the Debtors these hourly rates: Executive Directors/Principals/Partners $765 Senior Managers $615 Managers $545 Seniors $375 Staff $190 E&Y LLP also intends to charge the Debtors based on the time that assigned staff spends performing services, which are currently billed at $110 per hour. Mr. Chadwell maintains that E&Y LLP is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan to buy back or swap US$1.2 billion in debt from bondholders based on the vote of US$1.9 billion of intercompany debt when third-party creditors were opposed. Vitro as a result dismissed the first Chapter 15 petition following the ruling by the Mexican court. On April 12, 2011, an appellate court in Mexico reinstated the reorganization. Accordingly, Vitro SAB on April 14 re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10- 47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. WASHINGTON MUTUAL: Wants to Expand Perkins Coie Retention --------------------------------------------------------- BankruptcyData.com reports that Washington Mutual filed with the U.S. Bankruptcy Court a motion to expand the retention of Perkins Coie (Contact: John S. Kaplan) as special counsel in order to include legal assistance as local counsel with respect to a tax proceeding ft the following hourly rates: paralegal assistant at $80, paralegal at $255, associate at $240 to $405 and partner at $430 to $640. The Company originally retained the firm and John S. Kaplan in October 2008. 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. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York 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. The official committee of equity security holders also tapped BDO USA as its tax advisor. 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 U.S. Bankruptcy Court for the District of Delaware 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 Bankruptcy Court 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. WASHINGTON MUTUAL: Dime Investors Seek to Appoint Committee ----------------------------------------------------------- Lisa Uhlman at Bankruptcy Law360 reports that investors in Dime Bancorp Inc. asked a Delaware bankruptcy judge Wednesday to appoint an official committee to represent their interests as they seek to recover $337 million in Washington Mutual Inc.'s Chapter 11 proceedings. 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. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York 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. The official committee of equity security holders also tapped BDO USA as its tax advisor. 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 U.S. Bankruptcy Court for the District of Delaware 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 Bankruptcy Court 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. WASHINGTON MUTUAL: FDIC, Ex-WaMu Officers' Deal Talks Break Down ---------------------------------------------------------------- Lisa Uhlman at Bankruptcy Law360 reports that weeks after three ex-Washington Mutual Bank NA officers sought more negotiation time in the Federal Deposit Insurance Corp.'s suit in Washington state alleging they bankrupted the bank for their own benefit, settlement talks in the case have broken down, their attorneys said Wednesday. 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. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York 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. The official committee of equity security holders also tapped BDO USA as its tax advisor. 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 U.S. Bankruptcy Court for the District of Delaware 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 Bankruptcy Court 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. WJO INC: Gets 8th Interim Order to Use Bank's Cash Collateral ------------------------------------------------------------- The Hon. Jean K. Fitzsimon of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania entered its eight interim order allowing WJO Inc. to use cash collateral of Tristate Capital Bank from July 4, 2011, to Sept. 26, 2011. The Debtor has prepared a budget. A further interim hearing is set for Sept. 28, 2011, at 9:30 a.m. According to the Troubled Company Reporter on July 1, 2011, Tristate Capital Bank holds a lien against the accounts, chattel paper, documents, instruments, inventory, general intangibles, equipment, fixtures, deposit accounts, goods, letter of credit rights, supporting obligations, investment property, and commercial tort claims of the Debtor in the amount of $4,000,000. The Debtor proposed to provide adequate protection in the form of a replacement lien to the extent Tristate has liens prepetition, which are not subject to challenge and in the same extent, priority and validity as existed prepetition. The continued use of cash collateral, according to Thomas D. Bielli, Esq., at Ciardi Ciardi & Astin, in Philadelphia, Pennsylvania, will allow the Debtor to continue operating and continue with its reorganization by proposing a plan to restructure the existing debt to satisfy the creditors. In the meantime, the Debtor believes the interest of Tristate is adequately protected because Debtor's Cash Collateral Budget proposes to pay Tristate each month, when due, from its operations, Mr. Bielli said. About WJO Inc. Bristol, Pennsylvania-based WJO, Inc., operates six family practices located in Newtown, Bristol, Bensalem, Bustleton, South Philadelphia, and Bethlehem, Pennsylvania and consists of Board Certified Osteopathic Physicians specializing in Family Medicine. Prior to the petition date, and to allow the Company to restructure effectively, HyperOx Inc., HyperOx I, LP, HyperOx III, LP, and East Coast TMR, Inc., were merged into WJO. WJO filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No. 10-19894) on Nov. 15, 2010. The Debtor disclosed $19,923,802 in assets and $6,805,255 in liabilities as of the Chapter 11 filing. Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy counsel. Pond Lehocky Stern Giordano serves as the Debtor's special counsel to represent it in worker's compensation proceedings pertaining to the Therapeutic Magnetic Resonance treatments. Attorneys at Keifer & Tsarouhis LLP serve as counsel to the official committee of unsecured creditors. ParenteBeard LLC serves as the Committee's accountant and financial advisor. The United States Trustee has appointed David Knowlton as patient care ombudsman in the case. The Ombudsman is represented in the case by Karen Lee Turner, Esq., at Eckert Seamans Cherin & Mellott, LLC, as counsel. Tristate Capital Bank, the cash collateral lender, is represented in the case by lawyers at Benesch Friedlander Coplan & Aronoff LLP. YULEE VENTURE: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Yulee Venture No. One, LP dba Yulee Dixieland 16910 Dallas Parkway, Suite 100 Dallas, TX 75248 Bankruptcy Case No.: 11-10401 Chapter 11 Petition Date: July 5, 2011 Court: U.S. Bankruptcy Court Southern District of Texas (Brownsville) Judge: Richard S. Schmidt Debtor's Counsel: Matthew Brian Probus, Esq. WAUSON & PROBUS One Sugar Creek Center Boulevard, Suite 880 Sugar Land, TX 77478 Tel: (281) 242-0303 Fax: (281) 242-0306 E-mail: mbprobus@w-plaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by James Gissler, manager of St. Ives Realty, LLC, general partner. * Commercial and Individual Bankruptcies Down in June ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the 120,600 bankruptcy filings in the U.S. in June were the second-fewest this year and 10% below the same month last year. June was 14% below March, which marked the most in 2011, according to data compiled from court records by Epiq Systems Inc. According to the report, commercial bankruptcies continued dropping fastest of all. The 6,480 business bankruptcies in June were 16.8% below the same month in 2010. Filings in Chapter 11, where larger companies reorganize or liquidate, total 6,050 this year and are on pace to come in about 11% fewer than in 2010. Bankruptcies declined in all 50 states. So far this year there have been 731,200 bankruptcies of all types, compared with 1.56 million for 2010 as a whole. Last year had the most since 2005 when the all-time record was set at 2.1 million. Americans in 2005 were filing bankruptcy ahead of new laws making it more difficult for individuals to cancel debt. In the last two weeks before the law changed, 630,000 American sought bankruptcy protection. * Hanging Paragraph Isn't Tolled by Prior Bankruptcy -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that U.S. District Judge Lynn Adelman in Milwaukee ruled on June 20 ruled that the 2-1/2 year waiting period before a purchase money security interest can be bifurcated under the so- called hanging paragraph in Section 1325(a) of the Bankruptcy Code isn't tolled by an intervening bankruptcy. The judge ruled that the hanging paragraph is not a statute of limitations and thus isn't subject to the 2002 U.S. Supreme Court case called Young v. U.S. The new case is Hingiss v. MMCC Financial Corp., 11-0087, U.S. District Court, Eastern District Wisconsin (Milwaukee). * Supreme Court Seeks Solicitor General View on Mortgage Case ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Supreme Court last month asked for the views of the U.S. Solicitor General before deciding whether to review a bankruptcy case decided in December by the U.S. Court of Appeals in San Francisco. The case involves the question of what's a claim and what isn't. It also deals with possible conflict between bankruptcy law and federal law governing mortgages. The case arose from a lender's demand that bankrupt borrowers make up arrears on escrows. The bankrupts successfully argued in the Court of Appeals that the demand was a violation of the automatic bankruptcy stay stopping actions to collect debt. The majority opinion was by Circuit Judge Maryanne Trump Barry from the 9th Circuit in San Francisco. A dissenting opinion by Circuit Judge Dolores K. Sloviter said it wasn't a stay violation. The request for permission to appeal to the Supreme Court, known as a petition for certiorari, was made by the lender in April. The case in Supreme Court is Countrywide Home Loans Inc. v. Rodriguez, 10-1285, U.S. Supreme Court. The case in the 9th Circuit is In re Rodriguez, 09-2724, U.S. 9th Circuit Court of Appeals (San Francisco). * FDIC Paves Way to Reclaim Pay From Failed Banks' Execs -------------------------------------------------------- Ian Thoms at Bankruptcy Law360 reports that the Federal Deposit Insurance Corp. on Wednesday approved rules allowing bank regulators to take back up to two years of pay from executives who drove financial firms into the ground. Law360 says the rules, approved in a unanimous vote in FDIC Chairwoman Sheila Bair's last meeting, were required under the Dodd-Frank Act and allow regulators to claw back money from executives deemed to have been "substantially responsible" for the collapse of their firms. * Strategic Value Partners Ups Ante on European Distress Fund ------------------------------------------------------------- Dow Jones' DBR Small Cap reports that Strategic Value Partners LLC is upping the ante for its second special situations fund and raising the fund's target to from $600 million to $1 billion, in the face of a larger than anticipated opportunity in European distressed credit, according to people familiar with the offering. * BOOK REVIEW: The U.S. Healthcare Certificate of Need Sourcebook ----------------------------------------------------------------- Author: Robert James Cimasi Publisher: Beard Books Softcover: 520 pages Price: $199.95 Review by Henry Berry Established more than 30 years ago by the federal government and state governments, the Certificate of Need (CON) program was intended to be a primary way to control healthcare costs by regulating major capital expenditures and modifying healthcare service capacity. According to the author, the CON program is based on the premise that, "in an unregulated market health-care providers will provide the latest costly technology and equipment, regardless of duplication or need." With healthcare costs continuing to rise inexorably, CON programs are being reconsidered and reviewed by federal and state regulators and healthcare agencies. The CON program is still used by most states to control healthcare costs, although some states have abandoned the program or substantially modified it. The number of states with CON programs peaked at 49 in 1980 and remained in the high 40s for most of the 1980s. In 1988, the number dipped to 39 and has held steady in the high to mid 30s since then. In 2004, the number was at 36. Regardless, the CON program has significantly affected the delivery of healthcare in this country and still does. The U.S. Healthcare Certificate of Need Sourcebook is encyclopedic in scope and content, which reflects the author's breadth of knowledge about the subject matter. For over 20 years, Cimasi has helped clients in nearly every state understand and comply with the requirements of the CON program. He is a leading authority on CON issues, practices, procedures, regulations, and standards, and he has an incomparable background in healthcare consulting, litigation, and mergers and acquisitions. Cimasi draws upon his formidable experience and his record of helping healthcare businesses adapt to market and regulatory changes to present a great amount of information, cases, and developments relating to the CON program. The book offers readers an overview of CON program basics and a history of its development. This overview is complemented with a discussion of federal and state court cases and state administrative cases and decisions affecting the program's application. The author's treatment of these cases is thorough -- the cases categorized by states alone cover nearly 120 pages. The multitude of state cases are cited and annotated according to different levels of state courts, and also by their underlying causes of action and classification of regulated asset. For example, 20 underlying causes of action are offered under seven headings. The classifications for causes of action include procedural due process violations, arbitrary CON board decisions, establishment/challenge to new need requirements for state health plans, and definition of regulatory terms. The classifications for regulated assets include medical equipment such as magnetic resonance imaging and computerized tomography; ambulatory surgery centers; cancer treatment centers, dentist offices, hospitals, and other facilities; and services, including ambulances, cardiac catheterization, and dialysis. While the book is extraordinarily comprehensive in its treatment of the subject matter, it is also interactive and user friendly. From his experience with clients, Cimasi understands what is most important to impart to readers about the numerous cases cited throughout the book. The utility of this work is reflected in the "abstracts" of each case. The abstracts are categorized by state and include complete, consistent identification of each case according to standard legal annotation. Each abstract describes the grounds of the action, states the findings of the court, and gives the court's decision. For example, a sample abstract of the 1987 case Platte County Medical Center Inc. v. Missouri Health Facilities Review Committee describes the circumstances leading up to a final decision by an appeals court -- "Denied applicant appealed to the Circuit Court, Cole County after Committee denied its applicant for CON" -- along with other specifics of the case. The finding of the appeals court, which ended the litigation, was that the "Committee's failure to issue decision in a timely manner (under 120 days) indicated approval of CON." This information is useful for readers not only for decisions in particular states, but also for rulings for compliance with CON statutes and regulations by both healthcare organizations in the private sector and the government. Cimasi's book offers several other resources. One is a bibliography of hundreds of books and articles on CON. The Sourcebook also lists CON statutes and regulations by state and contact information for state agencies responsible for program implementation. Useful websites are also provided. This thorough guide and reference is invaluable to anyone who will be or is involved in the CON program in any of the states where it is still in place. Readers will also find it uniquely informative on government policies concerning healthcare. Robert James Cimasi, President of Health Capital Consultants, has a long and broad background in the fields of healthcare and business appraisal and mergers and acquisitions. A frequent speaker at conferences for national healthcare organizations, he is also the author of three books on healthcare and contributor of articles to others. ********* 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 ***