/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/111007.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, October 7, 2011, Vol. 15, No. 278 Headlines 10 MAPLE ASSOCIATES: Case Summary & 21 Largest Unsecured Creditors 155 EAST TROPICANA: Says Dispute Could Affect Bondholders' Rights 6000 LLC: Case Summary & 8 Largest Unsecured Creditors AERIE RESORT: Court OKs Resort Sale for $3.1 Million ALLEN FAMILY: Court OKs Deal on Sale Proceeds, Causes of Action AMACORE GROUP: To Settle Fla. & Texas Litigations for $380,000 AMERICAN SCIENTIFIC: Issues $150,000 Convertible Note to Lanktree AMR CORP: Inks $725.6-Mil. Note Purchase Agreement with U.S. Bank AMR CORP: S&P Says 2011-2 Certs Won't be Rejected in Ch. 11 AMRAN PROPERTIES: Case Summary & 2 Largest Unsecured Creditors ANGARAKA LIMITED: Modified Plan of Reorganization Confirmed APPLEJACK ART: Court Approves Building Sale to WCW for $3 Million ARLINGTON HOSPITALITY: Court Dismisses Chapter 11 Case ASHAPURA MINECHEM: Seeks Chapter 15 Protection in U.S. ASHAPURA MINECHEM: Chapter 15 Case Summary AUTOMASTERS LLC: Case Summary & 20 Largest Unsecured Creditors B&G GROUP: Owner Puts Biz in Ch. 11, Files Personal Bankruptcy BALDWIN TECHNOLOGY: Delays Report Amid Refinancing Talks BANK OF AMERICA: May Face Fraud Claims for Defective Loans BARBETTA LLC: Can Access Cash Collateral Until Nov. 29 BERNARD L. MADOFF: Picard Fights Bid to Dismiss Suit v. Kohn BERNARD L. MADOFF: UniCredit Wants to Nix Racketeering Claims BESO LLC: Court Approves Sale to Landry's Restaurant for $1 Mil. BLAKELY PARTNERS: Voluntary Chapter 11 Case Summary C&D TECHNOLOGIES: Angelo Gordon Buys Business for $9.75 Per Share CABI SMA: Court Approves Berman Rennert as Property Tax Counsel CASCADE BANCORP: LaMont Keen Elected to Board of Directors CAVIATA ATTACHED: U.S. Bank Wants Stay Relief or Case Dismissal CCS MEDICAL: Moody's Affirms 'B3' Corporate Family Rating CDC CORP: Legal Judgment Prompts Chapter 11 CHEF SOLUTIONS: Judge Clears $9-Million DIP Loan CHUKCHANSI ECONOMIC: Moody's Lowers CFR to Caa2; Outlook Negative CITY LOFT HOTEL: Files for Chapter 11 to Restructure Debt CITY LOFT HOTEL: Case Summary & 20 Largest Unsecured Creditors CITY LOFT, LLC: Case Summary & 20 Largest Unsecured Creditors CLEAN BURN: Court Ends Cash Collateral Use as of July 18 CLINTON COURT: Brooklyn Mixed-Use Building Files for Ch. 11 COMPETITIVE TECHNOLOGIES: Signs Factoring Agreement with Versant CONSYS CONCRETE: Case Summary & 20 Largest Unsecured Creditors CROSSOVER FINANCIAL: Bank Wants Chapter 11 Case Dismissed DALLAS STARS: Seeks to Employ KPMG as Auditors DECORATOR INDUSTRIES: Won't Seek DIP Loan to Fund Bankruptcy DEE ALLEN RANDALL: Says Ponzi Scheme Was "Legal" DUTCH RUN-MAYS: Case Summary & 5 Largest Unsecured Creditors EAST HARLEM: Meeting of Creditors Scheduled for Oct. 24 ENERGY FUTURE: Change in Executive Officers' Compensation Okayed EQK BRIDGEVIEW: Third Amended Plan of Reorganization Confirmed FILI ENTERPRISES: Court Dismisses Chapter 11 Reorganization Case FOXCHASE LLLP: Case Summary & 8 Largest Unsecured Creditors FPD LLC: Three Debtors Seek Dismissal of Chapter 11 Cases FPD LLC: Court OKs Pact Settling Clearview Property Sale Dispute F.Q. PARTNERS: Case Summary & 10 Largest Unsecured Creditors FRIENDLY ICE CREAM: Court Approves First Day Motions GALP CNA: Court Dismisses Case of GALP Cypress & Wentwood GENERAL MARITIME: Moves Closer to Formal Restructuring GENERAL MARITIME: S&P Cuts Corporate Credit Rating to 'SD' GENERAL MOTORS: Fitch Upgrades Issuer Default Rating to 'BB' GLOBAL CROSSING: Common Shares Delisted from NASDAQ GLOBAL CROSSING: Moody's Raises Corporate Family Rating to 'B3' GRACEWAY PHARMACEUTICALS: S&P Revises Corp. Credit Rating to 'D' GREAT ATLANTIC: Evicts Grocery Haulers From Avenel Warehouse GSC GROUP: Trustee Files Amended Ch. 11 Plan After $235MM Sale GSI HOLDINGS: Moody's Says B2 CFR Unaffected by Acquisition HOFMEISTER'S PERSONAL: Intends to Sell Inventory in November HORIZON LINES: Exchange Offer Expires; 99.3% of Notes Tendered HRAF HOLDINGS: U.S. Trustee Wants Case Dismissed or Converted HRAF HOLDINGS: Bank Paid in Full From Liquidation of Property IMR CONTRACTOR: Bankruptcy Case Delays Campus Projects INNER CITY MEDIA: Meeting of Creditors Set for Oct. 25 J.C. EVANS: Can Hire Tittle Advisory Group as Financial Advisors KILEY RANCH: Asks Court to Dismiss Chapter 11 Case KINGSBURY CORP: Files for Bankruptcy After Reaching Financing Deal KT SPEARS: Can Access RBC Cash; Excess Funds to be Paid to RBC LEED CORP: Court Approves Maynes Taggart as Bankruptcy Counsel LEHMAN BROTHERS: Mason Capital Seeks Rejection of Plan LEHMAN BROTHERS: Proposes to Settle Dispute on $500-Mil. Setoff LEHMAN BROTHERS: Proposes 2012 Incentive Program LEHMAN BROTHERS: Endurance, 4 Other Insurers to Pay D&O Defenses LEHMAN BROTHERS: Has Settlement With Arch Insurance LESARRA ATTACHED: Bankruptcy Converted to Chapter 7 LEVEL 3 COMMS: Fitch Lifts Issuer Default Rating to 'B' LEVEL 3: Assumes Awards Under the Global Crossing Plan LEVEL 3: Completes Acquisition of Global Crossing Limited LIBERTY MUTUAL: S&P Affirms 'BB' Junior Subordinated Debt Rating LIBERTY TIRE: Moody's Lowers CFR to 'B3'; Outlook Negative LKQ CORPORATION: Moody's Affirms 'Ba2' Corporate Family Rating LOCATION BASED TECHNOLOGIES: Launches PocketFinder in Apple Stores LONE EAGLE: Voluntary Chapter 11 Case Summary LONGYEAR PROPERTIES: Reorganization Case Converted to Liquidation LOS ANGELES DODGERS: Judge May Limit Probe About MLB's Other Teams LOUISVILLE ORCHESTRA: Management Rejects Contract Proposal LYDIAN SF: Files Schedules of Assets and Liabilities LYMAN LUMBER: Court Okayed Cash Access Until Sept. 22 LYMAN LUMBER: Term of Hilco Industrial Engagement Modified LYNN SQUARE: Case Summary & 3 Largest Unsecured Creditors M WAIKIKI: Section 341 Meeting Continues After Filing of Schedules M WAIKIKI: Court Approves Neligan Foley as Counsel METROPARK USA: Seeks Stay of Bench Ruling on Cash Collateral Use MODA HOSPITALITY: Case Summary & 20 Largest Unsecured Creditors MORNINGSIDE HEIGHTS: Terrace in the Sky Restaurant Closes Doors MSR RESORT: Court Extends Plan Filing Deadline to Oct. 14 NEWPAGE CORP: Receives Final Approval for $600-Mil. Financing NORTH COVE: Voluntary Chapter 11 Case Summary NUMBER ONE: Case Summary & 5 Largest Unsecured Creditors OLSEN AGRICULTURAL: Court Approves R.J. & L as Real Estate Broker PAUL BRENNEKE: Case Dismissal, Conversion Hearing Set for Oct. 26 PDSS PARTNERS: Voluntary Chapter 11 Case Summary PENINSULA HOSPITAL: Hires Alvarez & Marsal as Financial Advisors PENINSULA HOSPITAL: Seeks to Hire Abrams Fensterman as Counsel POLYONE CORPORATION: Moody's Affirms 'Ba2' Corp. Family Rating PONCE DE LEON: Hearing Today on Further Cash Use Access PONCE DE LEON: Meeting of Creditors Scheduled for Oct. 24 PONCE DE LEON: Wants to Hire RSM ROC as Accountant PONCE DE LEON: Wants to Hire Carmen Torres as Attorney POWER RECEIVABLE: S&P Affirms 'BB+' Rating on Subordinate Notes PREGIS CORP: S&P Puts B- Corp. Credit Rating on Watch Developing PURE BEAUTY: Returns to Chapter 11 in Delaware PURE BEAUTY: Case Summary & 20 Largest Unsecured Creditors QUALTEQ INC: Bank of America Seeks to Transfer Venue of Cases QUINCY MEDICAL: Court Sets Nov. 10 as Claims Bar Date QWEST COMMUNICATIONS: Sells $950 Million of 6.75% Notes Due 2021 RADIATION THERAPY: Moody's Says B2 CFR Unaffected by Amendments REAL MEX: Moody's Cuts Probability of Default Rating to 'D' REGAL PLAZA: Court Dismisses Chapter 11 Cases RIVIERA HOLDINGS: Moody's Affirms 'B3' Corporate Family Rating ROAM DEVELOPMENT: Case Summary & 10 Largest Unsecured Creditors SAGAMORE PARTNERS: In Chapter 11 to Address Dispute With Servicer SCOTTO RESTAURANT: Court Sets Oct. 12 Final Hearing on Cash Use SEAHAWK DRILLING: Court Confirms First Amended Joint Plan SEQUOIA VILLAGE: Case Summary & 16 Largest Unsecured Creditors SITHE/INDEPENDENCE: Moody's Withdraws B2 Rating & Stable Outlook SOLYNDRA LLC: Watchdog Wants Trustee or Chapter 7 Conversion SPECIALTY PRODUCTS: Judge Won't Review Discovery Denial STRATEGIC AMERICAN: C.W. Navigation Discloses 17.9% Equity Stake SUPERIOR PROPERTY: Files Schedules of Assets and Liabilities TELESAT CANADA: Moody's Affirms 'B2' Corporate Family Rating TELTRONICS INC: To Sell Off Assets Under Exit Plan TEMPLE OF PRAYER: Case Summary & Largest Unsecured Creditor TIRES UNLIMITED: Files for Chapter 11 Bankruptcy Protection TIRES UNLIMITED: Case Summary & 20 Largest Unsecured Creditors TITAN SPECIALTIES: S&P Raises Corporate Credit Rating to 'B' TOUSA INC: Can Access Prepetition Lenders' Cash Until Jan. 31 TOWNSEND CORP: Hires McQueen & Ashman as Special Counsel TOWNSEND CORP: Taps Levene Neale as Bankruptcy Counsel TOWNSENDS INC: Chapter 11 Switched on Consent to Chapter 7 TRI-STATE SIGNAL: Files for Chapter 11 Bankruptcy Protection TRI-STATE SIGNAL: Voluntary Chapter 11 Case Summary TRIBUNE CO: Bar Date Order Excluded D&O Indemnification Claims TRIBUNE CO: Late D&O Indemnification Claims Deemed Timely Filed TROPICANA ENT: Hearing on Tropicana Trademark on Nov. 22 UNITED ENERGY: Chief Executive Officer Ronald Wilen Dies U.S. DRY CLEANING: Completes Chapter 11 Reorganization VEGA CRESCENT: Voluntary Chapter 11 Case Summary WAHE GURU: Case Summary & 10 Largest Unsecured Creditors WESTERN COMMUNICATIONS: Oregon Papers Have Nod for Cash Use WILLIAM LYON: Fails to Pay $7.4 Million of Senior Notes Interest WINDRUSH SCHOOL: Gets Court's Interim OK to Use Operating Case YEHUD-MONOSSON USA: 8th Circ. Approves Forced Chapter 7 ZAIS INVESTMENT: Anchorage Capital Amends Prepackaged Plan ZOGENIX INC: Domain Partners Discloses 15.4% Equity Stake * U.S. Supreme Court Won't Settle Split on Auto Loan Case * Homestead Limit Doesn't Make Judgment Enforceable * False Invoice Not Equivalent to False Financials * Oaktree Capital Nears Final Close for European Distress Fund * Siguler Guff & Co Raises $1.3 Billion for Distressed Debt Fund * SNR Denton Expands Bankruptcy Practice with Sam Alberts * Akin Gump Grabs Haynes and Boone Pro for Texas Office * BOOK REVIEW: Legal Aspects of Health Care Reimbursement ********* 10 MAPLE ASSOCIATES: Case Summary & 21 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: 10 Maple Associates LLC 651 Broadway Sonoma, CA 95476 Bankruptcy Case No.: 11-13639 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: Michael St. James, Esq. ST. JAMES LAW P.C. 155 Montgomery St. #1004 San Francisco, CA 94104 Tel: (415) 391-7566 E-mail: ecf@stjames-law.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 21 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb11-13639.pdf The petition was signed by Leslie B. Seely, III, co-managing member. 155 EAST TROPICANA: Says Dispute Could Affect Bondholders' Rights ----------------------------------------------------------------- Steve Green at Vegas Inc. reports that Hooters Las Vegas said an effort by creditor Canpartners Realty Holding Company IV LLC to narrow the bankruptcy case to a Canpartners-Hooters dispute could jeopardize the rights of third parties -- some 80 holders of $3 million in Hooters' bond debt. "Such conduct should be of concern to U.S. Bank (agent for the bond holders) as the entity responsible for protecting the rights and interests of all the holders of the senior secured notes," Hooters' filing said in what appeared to be an invitation for U.S. Bank, Vegas Inc. notes. The report says the Hooters filing on Oct. 3, 2011, was in response to an unusual request to U.S. Bankruptcy Judge Bruce Markell by Canpartners on Sept. 20 that he narrow the bankruptcy case to a Canpartners v. Hooters showdown. Canpartners asked that Hooters be required to set aside $2 million so small trade creditors and individuals could get paid immediately, rather than having to wait for the bankruptcy case to run its course. That could take months or years. Mr. Green notes Canpartners says it holds all but $3 million of Hooters' bank and bond debt. That debt is worth $181 million on paper, but Hooters has complained that Canpartners picked up most of the debt for just 22 cents on the dollar. The report says attorneys for Hooters, besides arguing that Canpartners' plan jeopardizes the rights of holders of the $3 million in debt not held by Canpartners, called Canpartners' motion "manipulative" and its legal theories a "perverse misconstruction" of the bankruptcy law. Hooters complained Canpartners is attempting an end-run around the bankruptcy law that gives Hooters a 120-day period since its bankruptcy filing in which it exclusively can propose a plan of reorganization, says Mr. Green. About 155 East Tropicana 155 East Tropicana LLC owns the world's first Hooters Casino Hotel, a 696-room and 4-suite hotel located one block from the Las Vegas Strip and across Tropicana Blvd. from MGM Grand. 155 East Tropicana, along with an affiliate, sought Chapter 11 protection (Bankr. D. Nev. Case No. 11-22216) on Aug. 1, 2011. 155 East sought bankruptcy protection to stop a scheduled Aug. 8 foreclosure of the second-lien debt. The two secured credit facilities were accelerated early this year. Canpartners Realty Holding Co. IV LLC acquired 98.4% of the $130 million in 8.75% second-lien senior secured notes. An additional $32.2 million of interest is owing on the second-lien debt. US Bank NA is the indenture trustee. Holders of the $14.5 million in first-lien debt have Wells Fargo Capital Finance Inc. as their agent. The first-lien obligation is fully secured. Interest has been paid at the default rate. Brigid M. Higgins, Esq., at Gordon & Silver, Ltd., in Las Vegas, Nevada, serves as counsel to the Debtors. Garden City Group, Inc., is the claims agent. William G. Kimmel & Associates has been hired to provide an appraisal of the Debtors' casino hotel/property. Alvarez & Marsal serves as financial and restructuring advisor. Innovation Capital LLC serves as financial advisor for capital raising transactions and M&A transactions. 155 East Tropicana disclosed $62,236,842 in total assets and $177,806,045 in total liabilities in its schedules. 6000 LLC: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------ Debtor: 6000, LLC 6000 W. Touhy, Ste. 200 Chicago, IL 60646 Bankruptcy Case No.: 11-40368 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Northern District of Illinois (Chicago) Judge: John H. Squires Debtor's Counsel: Konstantine T. Sparagis, Esq. LAW OFFICES OF KONSTANTINE SPARAGIS P.C. 8 S Michigan Ave 27th Fl Chicago, IL 60603 Tel: (312) 753-6956 Fax: (866) 333-1840 E-mail: gsparagi@yahoo.com Scheduled Assets: $2,700,000 Scheduled Debts: $10,659,065 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ilnb11-40368.pdf The petition was signed by Gus Tountas, member. AERIE RESORT: Court OKs Resort Sale for $3.1 Million ------------------------------------------------------ Andrew A. Duffy at Canada-based The Victoria Times Colonist reports that the Aerie Resort now officially belongs to 0919097 B.C. Ltd. The B.C. Supreme Court has signed off on the sale of the once high-end resort for $3.1 million, the price offered by the numbered company, according to the report. The report notes that there was plenty of interest in the resort. The Times Colonist discloses that the trustee overseeing the sale estimated more than 100 would-be buyers took tours over the last two years. According to the report, there were more than a dozen people in court for the sale proceeding. But no competing offer was presented to the judge. "No one came forward ... I was surprised there were no other bids," said trustee Ken Glover, who has been overseeing the resort since it was placed into receivership in the winter of 2009, The Times Colonist says. The court ruled that 0919097 B.C. Ltd., which lists Harvey Simons of Shawnigan Lake as its lone director, now has 30 days to close the sale, the report notes. The $3.1 million price, below the asking price of $3.95 million, is expected to net the Aerie's largest creditor, Island Savings Credit Union, just under $2.4 million, The Times Colonist notes. The credit union was owed $4.7 million as of this month, the report says. The Times Colonist relates that of the $3.1-million sale price, the trustee is owed about $650,000 for various expenses, including two years of caretaking and listing the property for sale with DTZ Barnicke. Another $100,000 is set aside for other creditors who have security through chattel, the report discloses. There are no more court dates set, and Mr. Glover said they now will just wait for the money to come through, the report adds. ALLEN FAMILY: Court OKs Deal on Sale Proceeds, Causes of Action --------------------------------------------------------------- The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware approved a stipulation entered by Allen Family Foods, Inc., et al., in connection with the sale of the Debtors' assets. The stipulation was entered among the Debtors, MidAtlantic Farm Credit, ACA, for itself and as the agent/nominee for the lenders who made senior prepetition secured loans to the Debtors (the prepetition lenders), Harim USA, Ltd. (the purchaser), and the Official Committee of Unsecured Creditors. The stipulation dated Aug. 31, 2011, provides for, among other things: 1. Nothing contained in the sale order will in a way waive or impair the right of the Committee to assert claims and assert claims and causes of action under Chapter 5 of the Bankruptcy Code against the prepetition lenders, and any and all claims and causes of action against the prepetition lenders are hereby expressly reserved by the Committee. 2. The closing payment to be made to the prepetition lender on the closing date will not include those sale proceeds necessary to pay all outstanding accounts payable that have been incurred but not paid as of the date of closing of the sale. 3. The stipulation may be executed in one or more counterparts and by facsimile or e-mail, all of which will be considered one and the same agreement, and will become effective on the date that (a) one or more counterparts have been signed by each of the parties and delivered to all parties and (b) the Bankruptcy Court has entered a final non-appealable order approving the stipulation. As reported in the Troubled Company Reporter on Sept. 15, 2011, the unsecured creditors of the Debtors filed a lawsuit to: (1) block the Debtor's biggest lender -- a group led by MidAtlantic Farm Credit ACA -- from taking what remains of the proceeds from the $45.2 million sale of the company to cover the liens the lender had on nearly all of the company's assets before it sought Chapter 11 bankruptcy protection; and (2) demand that the lender group prove the validity of the liens they claim to have on Allen Family Foods-owned properties, which unsecured creditors have questioned. The TCR reported that the lawsuit is a step taken by the unsecured creditors to ensure that they recover something from the struggling company's sale. The remaining pool of sale money would barely pay off the lender's higher-ranking pre-bankruptcy loans -- a sum that tops $80 million --- before lower-ranking creditors have a chance to be paid, according to court papers. The TCR reported on July 29, 2011, the Debtor won the bankruptcy judge's approval to sell its assets to a U.S. affiliate of Korean poultry producer Harim Co. Ltd. The sale was approved despite creditors' questions about the administrative solvency of the case. Harim USA, Ltd. is represented by: Richard A. Robinson, Esq. REED SMITH LLP 1201 N. Market Street, Suite 1500 Wilmington, DE 19801 Tel: (302) 778-7500 Fax: (302) 778-7575 MidAtlantic Farm is represented by: Joseph J. Bodnar, Esq. LAW OFFICES OF JOSEPH J. BODNAR P.O. Box 1022 Wilmington, DE 19899-1022 Tel: (302) 449-4572 Fax: (302) 397-2093 E-mail: jbodnar@bodnarlaw.net - and - Julio E. Mendoza, Jr., Esq. NEXSEN PRUET, LLC 1230 Main Street, Suit 700 P.O. Drawer 2426 Columbia, SC 29202 Tel: (803) 771-8900 Fax: (803) 253-8277 The Committee is represented by: Steven K. Kortanek, Esq. Thomas M. Horan, Esq. WOMBLE CARLYLE SANDRIDGE & RICE, PLLC 222 Delaware Avenue, Suite 1501 Wilmington, DE 19801 Tel: (302) 252-4320 Fax: (302) 252-4330 - and - Jeffrey D. Prol, Esq. Bruce Nathan, Esq. Timothy R. Wheeler, Esq. LOWENSTEIN SANDLER PC 65 Livingston Avenue Roseland, NJ 07068 Tel: (973) 597-2500 Fax: (973) 597-2400 About Allen Family Foods Allen Family Foods Inc. is a 92-year-old Seaford, Del., poultry company. Allen Family Foods and two affiliates, Allen's Hatchery Inc. and JCR Enterprises Inc., filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-11764) on June 9, 2011. Allen estimated assets and liabilities between $50 million and $100 million in its petition. Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serve as counsel to the Debtors. FTI Consulting is the financial advisor. BMO Capital Markets is the Debtors' investment banker. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Roberta DeAngelis, U.S. Trustee for Region 3, appointed seven creditors to serve on an Official Committee of Unsecured Creditors in the Debtors' cases. Lowenstein Sandler PC and Womble Carlyle Sandridge & Rice, PLLC, serve as counsel for the committee. J.H. Cohn LLP serves as the Committee's financial advisor. AMACORE GROUP: To Settle Fla. & Texas Litigations for $380,000 -------------------------------------------------------------- The Amacore Group, Inc., on Sept. 26, 2011, entered into a Settlement and Mutual Release Agreement with all parties to the pending litigation in (i) the Middle District of Florida, Tampa Division Case No. 2:09-cv-02562-JAG-MCA; and (ii) Tarrant County, Texas, Cause No. 153 238622 09. The material terms of the Settlement Agreement are: * The plaintiffs and defendants of the Pending Litigation mutually released, waived and forever discharged all parties to the Settlement Agreement; * The Company, together with the Company's insurer, on behalf of the insured individual defendants, agreed to pay or cause to be paid US$380,000 to plaintiffs; * The plaintiffs and defendants of the Pending Litigation agreed to file a stipulated dismissal of all Pending Litigation; * The Settlement Agreement is not and may not be used as an admission of infringement or liability by anyone and does not constitute any acquiescence, acknowledgement, or agreement as to the merit of any matter related to the Pending Litigation. About The Amacore Group Based in Maitland, Florida, The Amacore Group, Inc., (OTC BB: ACGI) -- http://www.amacoregroup.com/-- is primarily a provider and marketer of healthcare related products, including healthcare benefits, vision and dental networks, and administrative services such as billing, fulfillment, patient advocacy, claims administration and servicing. * * * In its March 31, 2010 report, McGladrey & Pullen, LLP in Orlando, Florida, raised substantial doubt about the Company's ability to continue as a going concern. The auditor said the Company has suffered recurring losses from operations and has not generated sufficient cash flows from operations to meet its needs. The Company's balance sheet at June 30, 2010, showed $8,595,986 in total assets, $25,985,443 in total liabilities, and a $17,147,252 stockholders' deficit. AMERICAN SCIENTIFIC: Issues $150,000 Convertible Note to Lanktree ----------------------------------------------------------------- American Scientific Resources, Incorporated, on Sept. 26, 2011, issued a $150,000 six-month convertible note in favor of Lanktree Consulting Corporation. The principal amount due under the Note is due and payable on March 26, 2012. Further, interest on the unpaid principal balance of the Note will accrue at a rate of 12% per annum commencing on the Issuance Date. At the option of the Holder, the Holder has the right to convert all or a portion of the outstanding principal balance and accrued interest into fully paid and non-assessable shares of the Company's common stock at a conversion price of $0.10. Further, if any other noteholder of the Company converts a note according to its terms at a conversion price of less than $0.10, then the Holder will be able to convert the Note at that lower conversion price. The Company has the option to prepay the Note in whole or in part at any time without penalty, provided that the Company notifies the Holder thirty days prior to a prepayment. In accordance with the terms of the Note, the Company issued to the Holder 1,500,000 shares of the Company's common stock, par value $0.0001 per share. About American Scientific Weston, Fla.-bases American Scientific Resources, Inc., provides healthcare and medical products. The Company develops, manufactures and distributes healthcare and medical products primarily to retail drug chains, retail stores specializing in sales of products for babies and medical supply dealers. The Company does sub-component assembly and packaging for the Disintegrator product line. All of the Company's other products are manufactured by third parties. The Company was comprised of three subsidiaries: (i) Kidz-Med, Inc., (ii) HeartSmart, Inc., and (iii) Ulster Scientific, Inc., of which only Kidz-Med was active until Dec. 31, 2010. All subsidiaries are currently inactive. The Company's balance sheet at June 30, 2011, showed $1.38 million in total assets, $9.28 million in total liabilities, and a $7.90 million total shareholders' deficit. Rosenberg Rich Baker Berman & Company, in Somerset, New Jersey, expressed substantial doubt about American Scientific Resources' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses, its current liabilities exceed its current assets and it is in default with certain of its obligations. AMR CORP: Inks $725.6-Mil. Note Purchase Agreement with U.S. Bank ----------------------------------------------------------------- American Airlines, Inc., a wholly-owned subsidiary of AMR Corporation, and U.S. Bank Trust National Association, as subordination agent and as pass through trustee under the pass through trust newly formed by American, U.S. Bank National Association, as escrow agent under the Escrow Agreement, and U.S. Bank Trust National Association, as paying agent under the Escrow Agreement, entered into a Note Purchase Agreement. The Note Purchase Agreement, subject to certain terms and conditions, provides for the future issuance by American of equipment notes in the aggregate principal amount of $725,694,000 to be secured by 43 Boeing aircraft owned by American as specified in the Note Purchase Agreement. Pursuant to the Note Purchase Agreement and the form of Participation Agreement and form of Indenture and Security Agreement, upon the financing of each Aircraft, the Trustee will enter into a Participation Agreement substantially in the form of the Form of Participation Agreement and will purchase the Series A Equipment Notes to be issued by American under an Indenture and Security Agreement substantially in the form of the Form of Indenture to be entered into by American and U.S. Bank Trust National Association, as loan trustee, with respect to such Aircraft. The payment obligations of American under the Series A Equipment Notes will be fully and unconditionally guaranteed by AMR. Each Indenture contemplates the issuance of Series A Equipment Notes bearing interest at the rate of 8.625% per annum, in the aggregate principal amount equal to $725,694,000. The Series A Equipment Notes will be purchased by the Trustee, using the proceeds from the sale of American Airlines Class A Pass Through Certificates, Series 2011-2. Pending the purchase of the Series A Equipment Notes, the proceeds from the sale of the Class A Certificates were placed in escrow by the Trustee pursuant to the Escrow and Paying Agent Agreement, dated as of Oct. 4, 2011, among the Escrow Agent, the Paying Agent, the Underwriters and the Trustee. The escrowed funds were deposited with The Bank of New York Mellon pursuant to the Deposit Agreement, dated as of Oct. 4, 2011, between the Escrow Agent and the Depositary. The interest on the Series A Equipment Notes and the escrowed funds is payable semi-annually on each April 15 and October 15, beginning on April 15, 2012. The principal payments on the Series A Equipment Notes are scheduled for payment on April 15 and October 15 in certain years, beginning on April 15, 2012. Final payment with respect to each Series A Equipment Note will be due, depending on the Aircraft relating to such Series A Equipment Note, on Oct. 15, 2017, Oct. 15, 2019, or Oct. 15, 2021. Maturity of the Series A Equipment Notes may be accelerated upon the occurrence of certain events of default, including failure by American to make payments under the applicable Indenture when due or to comply with certain covenants, as well as certain bankruptcy events involving American. The Series A Equipment Notes issued with respect to each Aircraft will be secured by a lien on such Aircraft and also will be cross-collateralized by the other Aircraft financed pursuant to the Note Purchase Agreement. The Class A Certificates were registered for offer and sale pursuant to the Securities Act of 1933, as amended, under American's and AMR's shelf registration statement on Form S-3. The Class A Certificates were sold pursuant to the Underwriting Agreement, dated as of Sept. 27, 2011, among American, AMR and Morgan Stanley & Co. LLC, Deutsche Bank Securities Inc., Goldman, Sachs & Co., Credit Suisse Securities (USA) LLC and Citigroup Global Markets Inc., as representatives of the underwriters. About AMR Corporation Headquartered in Fort Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. As of Dec. 31, 2009, American provided scheduled jet service to approximately 160 destinations throughout North America, the Caribbean, Latin America, Europe and Asia. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. The Company also reported a net loss of $722 million for the six months ended June 30, 2011. The Company's balance sheet at June 30, 2011, showed $25.78 billion in total assets, $30.29 billion in total liabilities, and a $4.51 billion stockholders' deficit. * * * AMR carries a 'CCC' issuer default rating from Fitch Ratings, 'Caa1' corporate family and probability of default ratings from Moody's, and a 'B-' corporate credit rating from Standard & Poor's. In November 2010, Standard & Poor's Ratings Services revised its outlook on AMR Corp. and its major operating subsidiary, American Airlines Inc., to stable from negative, based on AMR's improved operating performance, which has bolstered credit quality. S&P also affirmed its 'B-' corporate credit rating and most issue ratings on the two companies and lowered selected ratings on American's enhanced equipment trust certificates. AMR CORP: S&P Says 2011-2 Certs Won't be Rejected in Ch. 11 ----------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'A- (sf)' rating to American Airlines Inc.'s series 2011-2 class A pass-through certificates with an expected maturity of Oct. 15, 2021. The final legal maturity will be 18 months after the expected maturity. The issue is a drawdown under a Rule 415 shelf registration. The 'A- (sf') rating reflects American's credit quality, substantial collateral coverage by a combination of mostly desirable legal and structural protections available to the pass- through certificates. The company will use proceeds of the offering to refinance aircraft it already owns: 16 Boeing B737- 800s, 14 B757-200s, and 13 B777-200ERs. All except two B737-800s are 10-12 years old (the others are two years old). "Each aircraft's secured notes are cross-collateralized and cross- defaulted--a provision we believe increases the likelihood that American would affirm the notes (and thus continue to pay on the certificates) in bankruptcy," S&P related. The pass-through certificates are a form of enhanced equipment trust certificates (EETC) and benefit from legal protections afforded under Section 1110 of the U.S. Bankruptcy Code and by liquidity facilities provided by Morgan Stanley Bank N.A. The liquidity facilities are intended to cover up to three semiannual interest payments (a period during which collateral could be repossessed and remarketed by certificateholders following any default by the airline) or to maintain continuity of interest payments as certificateholders negotiate with American in a bankruptcy with regard to certificates. The rating applies to a unit consisting of certificates representing the trust property and escrow receipts, initially representing interests in deposits (the proceeds of the offerings). The escrow deposits are held by a depositary bank, The Bank of New York Mellon, pending delivery of the aircraft that American will refinance with proceeds from the certificates. Amounts deposited under the escrow agreements are not the property of American and are not entitled to the benefits of Section 1110 of the U.S. Bankruptcy Code, and any default arising under an indenture solely by reason of the cross-default in the indenture may not be of a type required to be cured under Section 1110. Any cash collateral held as a result of the cross- collateralization of the equipment notes also would not be entitled to the benefits of Section 1110. Neither the certificates nor the escrow receipts may be separately assigned or transferred. "We believe that American views these planes as important and would, given the cross-collateralization and cross-default provisions, likely affirm the aircraft notes in a bankruptcy scenario. In contrast to most EETCs issued before 2009, the cross- default would take effect immediately in a bankruptcy if American rejected any of the aircraft notes. This should prevent American from selectively affirming some aircraft notes and rejecting others ('cherry-picking'), which often harms the interests of certificateholders in a bankruptcy," S&P related. "We consider the collateral pool overall to be of mostly good quality. The largest proportion of initial appraised value (about 56%) comprises B777-200ERs. The B777-200ER (extended range) is a successful midsize, long-range widebody plane. The larger versions of Boeing Co.'s new B787 and, in particular, Airbus SAS' A350 will eventually provide alternatives, which we expect will occur before these certificates are fully repaid. We believe this could place long-term value pressure on the B777-200ER. In our analysis, we judged these planes to be slightly less liquid in the re-sale market than recently delivered B777-200ERs would be. Most of the B777 aircraft that Boeing is delivering currently are the larger B777-300ERs," S&P related. The second-largest proportion of collateral value is represented by B737-800s. This is Boeing's most popular aircraft, a midsize narrowbody plane that more than 100 airlines worldwide operate. "Given the modern technology incorporated in the plane, its wide user base, and expected demand in excess of supply over the next couple of years, we consider it to be the best aircraft collateral currently available. Boeing recently launched a successor model -- the B737 MAX, a re-engined version intended to compete with Airbus' new A320 NEO family. American recently ordered both B737 MAX and A320 NEO planes (as well as current technology versions of both the B737 and A320 families) in a large order split between the two manufacturers. Although the introduction of successor planes will eventually place pressure on values of existing B737-800s, the new MAX model will not be available for at least five years, and large numbers will not be delivered for years after that. Still, as for the B777-200ERs, we view the resale liquidity of the B737-800s that are 10-12 years old as somewhat less favorable than for newer models," S&P related. The balance of value, about 19%, is made up of B757-200s, large narrowbody aircraft introduced in the 1980s and widely used, especially by U.S. airlines. All of these are or will soon be capable of international service over oceans (used by American on trans-Atlantic flights). Although the B757-200 incorporates somewhat dated technology, there is no successor aircraft from either Boeing or Airbus of this relatively small size that can fly trans-Atlantic, which is useful on routes more lightly travelled than those served by widebody aircraft. "We incorporate this factor into our assessment of these B757-200s' technological risk and liquidity," S&P said. The initial and maximum loan-to-value (LTV) of the class A certificates is 45.3%, using the appraised base values and depreciation assumptions in the offering memorandum. "However, we focused on more-conservative maintenance-adjusted base values for the B737-800s and maintenance-adjusted current market values for the B777-200ERs and B757-200s, resulting in an initial LTV that's about 11% lower than the value shown in the offering memo. We also use more-conservative depreciation assumptions for all of the planes than those in the prospectus. We assumed that, absent cyclical fluctuations, values of the B737-800s would decline by 5% of the preceding year's value per year, and the B777-200ERs and B757-200s, 7%," S&P stated. Using these values and assumptions, the class A initial LTV is higher, at 51.2%. "Our analysis also considered that a full draw of the liquidity facility, plus interest on those draws, represents a claim senior to the certificates. We factored that added priority claim in our deliberations. We note that the transaction is structured so that American could later issue class B certificates. If those certificates had a liquidity facility, draws on that facility would rank senior to repayment of the class A principal and interest, effectively raising the total LTV. In that case, we would review our rating on the class A certificates. In the past, airlines have structured follow-on certificates in such a way as to not affect the rating of the outstanding senior certificates," S&P related. On Oct. 3, 2011, American's parent, AMR Corp., suffered a substantial decline in its common share price, apparently reacting to negative media reports. "We believe that AMR and American face significant operating challenges arising from relatively high labor costs and revenue underperformance compared with competitors, and that the company will report a substantial loss this year. However, we see liquidity, bolstered by the proceeds from the series 2011-2 class A certificates, as still adequate. AMR had $5.2 billion of unrestricted cash and short-term investments as of June 30, 2011, which we expect to fall below $4 billion by year-end due to normal seasonal working capital patterns, ongoing losses, and heavy debt maturities. We could lower our ratings if the company's unrestricted cash and short-term investments fall consistently below $3 billion," S&P noted. Ratings List American Airlines Inc. Corporate credit rating B-/Negative/-- New Rating American Airlines Inc. Series 2011-2 class A pass-thru certs A- (sf) AMRAN PROPERTIES: Case Summary & 2 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Amran Properties, Inc. 1160 Ormewood Avenue Atlanta, GA 30316 Bankruptcy Case No.: 11-78228 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Joel M. Haber, Esq. LAW OFFICE OF JOEL M. HABER 2365 Wall Street, Suite 120 Conyers, GA 30013 Tel: (770) 922-9080 E-mail: joel@joelhaber.com Scheduled Assets: $1,250,000 Scheduled Debts: $1,245,779 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ganb11-78228.pdf The petition was signed by Gobind Madan, president. ANGARAKA LIMITED: Modified Plan of Reorganization Confirmed ----------------------------------------------------------- Judge Stacey G. Jernigan of the U.S. Bankruptcy Court for the Northern District of Texas has confirmed the modified plan of reorganization filed by Angakara Limited Partnership dated Sept. 28, 2010. The Modified Plan and each of its provisions are approved and confirmed under section 1129 of the Bankruptcy Code. The classification and treatment of claims under the plan are: A. Administrative claims will be paid in full in cash. B. Class 1 (Lender Claims) will receive a note in the amount due on the Petition Date after application of the escrows held by the Lender, payable over 24 months from the Distribution Date, and bearing interest at a rate of 4.35% per year. Reorganized Debtor will make monthly payments on the note equal to its excess cash flow. All outstanding principal and interest will be due and payable at the end of the 24-month term provided that the Reorganized Debtor will have the ability to liquidate one or more of the Properties prior to the end of the 24-month term, and upon doing so, will be required to remit to Lender a minimum of 70% of the net proceeds from the sale to be applied to the principal balance outstanding on the note. Reorganized Debtor may retain up to 30% of the net proceeds of the sale, to be used solely for the purpose of improving the remaining Properties through deferred maintenance and capital improvement rehabilitation projects. The Lender will retain all of its liens to the same extent, validity and priority as existed prepetition. C. Class 2 (Other Secured Claims) will receive (i) payments under the same terms and conditions as existed between the Debtor and holder prior to the Commencement Date; (ii) other treatment as may be agreed upon in writing by holder and Debtor; or (iii) the Collateral securing Allowed Other Secured Claim. D. Class 3 (Unsecured Claims) will receive over a period of six months from the Effective Date, two equal payments payable on each Quarterly Distribution Date until the Claim is paid in full. E. Class 4 (Old Equity Interests) will be cancelled and the holder will receive equity interests in the Reorganized Debtor equal to the holder's Old Equity Interest. A copy of the Plan of Reorganization is available for free at: http://bankrupt.com/misc/ANGARAKA_plan.pdf About Angaraka Limited Partnership Newport Beach, California-based Angaraka Limited Partnership, in November 2005, acquired and assumed indebtedness secured by, among other things, a Deed of Trust on four, Class B/C, garden-apartment properties located in the Dallas/Fort-Worth Metroplex. The Properties -- Woodchase, Clarendon, Keller Oaks, and Sycamore Hills -- total 750 units and range in date of construction from 1979 to 1983. The Company filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-33868) on May 31, 2010. Vincent P. Slusher, Esq., and J. Seth Moore, Esq. at DLA Piper LLP US, in Dallas, Texas, assist the Debtor in its restructuring effort. The Debtor estimated assets and debts at $10 million to $50 million. APPLEJACK ART: Court Approves Building Sale to WCW for $3 Million ----------------------------------------------------------------- Keith Whitcomb, Jr., at Bennington (Vt.) Banner reports that Judge Colleen Brown has approved the sale of the Applejack Art Partners building to WCW Inc. for $3 million on Oct. 3, 2011. According to the report, in August, WCW Inc., a mattress manufacturer based in Hoosick Falls, N.Y., announced it would be moving its operations there, as well as a call center in Bennington, to the Applejack Art building in the coming months, pending the completion of a sale agreement. The report notes that Applejack in September filed an updated payment plan for its creditors in U.S. Bankruptcy Court. Under the plan filed by Applejack's attorney Jennifer Emens-Butler, Esq. -- jennifer@oeblaw.com -- at Obuchowski & Emens-Butler, the $3 million will be used to pay Wachovia (Wells Fargo) on a $2.99 million debt. Applejack doesn't anticipate there being funds left over for the Vermont Economic Development Authority, which had loaned Applejack $1.2 million to purchase the building. VEDA Chief Executive Officer Jo Bradley said Monday that doesn't mean VEDA will not get its money back. She said the sale doesn't negate the loan, but she wouldn't comment further as the case is pending in bankruptcy court. The report notes WCW employs 106 people and plans to have those employees based in Manchester by the end of February 2012. About Applejack Art Partners Applejack Art Partners, Inc., manufactures fine art prints and sells sports memorabilia. It acquired Bruce McGaw Graphics in August 2009, gaining the exclusive rights to images from the Walt Disney Co., the Museum of Modern Art and Andy Warhol. Applejack Art Partners sought Chapter 11 protection (Bankr. D. Vermont Case No. 10-10911) on July 6, 2010. Applejack is represented by the Bethel law firm of Obuchowski and Emens-Butler. The Debtor estimated assets of $1 million to $10 million and debts under $50 million as of the Chapter 11 filing. Berkshire Bank holds a secured note dated March 2007, totaling about $628,124, and a second secured loan at $102,521. ARLINGTON HOSPITALITY: Court Dismisses Chapter 11 Case ------------------------------------------------------ The Hon. Bruce W. Black of the U.S. Bankruptcy Court for the Northern District of Illinois dismissed the Chapter 11 case of Arlington Hospitality, Inc. As reported in the Troubled Company Reporter on Aug. 10, 2011, the Debtor explained that they filed their bankruptcy cases with the intent of conducting a going concern sale of their business pursuant to 11 U.S.C. Sec. 363(f). The Debtor has sold its assets for $8 million in cash (including a settlement payment made by Cendant Corporation as part of the sale) and the assumption of the Debtors' mortgage liabilities totaling approximately $36 million. The Debtor added, "During the sale process, the Debtors post-petition lender, Arlington L.F, LLC refused to fund its obligations under its loan agreement. Although the Debtor repaid the principal balance of the loan with interest upon the closing of the Section 363 sale, Arlington L.F., LLC demanded additional fees and expenses. This dispute resulted in two appeals to the District Court and an appeal to the Seventh Circuit, preventing the closing of this case. On March 3, 2011, the United States Court of Appeals for the Seventh Circuit entered a final judgment in favor of the Debtors and ruling that Arlington L.F., LLC had no right to recovery from the bankruptcy estate. Throughout this dispute, the Debtors and the Committee attempted on multiple occasions to reach a settlement with Arlington L.F., LLC to put an end to the dispute but to no avail." The Company concluded, "Dismissal of the case as opposed to conversion is in the best interests of the estate and its creditors as there is nothing left for a chapter 7 trustee do. The Committee supports conversion of the case." About Arlington Hospitality Based in Arlington Heights, Illinois, Arlington Hospitality, Inc., dba Amerihost Properties, Inc., and its affiliates developed and constructed limited service hotels and owned, operated, managed and sold those hotels. The Company operated 15 AmeriHost Inn Hotels under leases from PMC Commercial Trust. Arlington Hospitality, Inc., serves as a guarantor under these leases. Arlington Inns Inc., an affiliate, filed for bankruptcy protection (Bankr. N.D. Ill. Case No. 05-24749) on June 22, 2005, the Honorable A. Benjamin Goldgar presiding. Arlington Hospitality and additional debtor-affiliates filed for chapter 11 protection on (Bankr. N.D. Ill. Lead Case No. 05-34885) Aug. 31, 2005, represented by Catherine L. Steege, Esq., at Jenner & Block LLP. Chanin Capital LLC served as the company's investment banker. David W. Wirt, Esq., at Winston & Strawn, represented the Official Committee of Unsecured Creditors. As of March 31, 2005, Arlington Hospitality reported $99 million in total assets and $94 million in total debts. The Debtors proposed a Joint Plan of Orderly Liquidation in August 2007. ASHAPURA MINECHEM: Seeks Chapter 15 Protection in U.S. ------------------------------------------------------ Dow Jones' DBR Small Cap reports that India mining giant Ashapura Minechem Ltd. filed for Chapter 15 bankruptcy protection Tuesday in U.S. Bankruptcy Court in Manhattan in a move to block foreign shipping companies that won a $125 million legal judgment against it from raiding the company's U.S. bank accounts. Ashapura Minechem Ltd. is an India mining giant company. ASHAPURA MINECHEM: Chapter 15 Case Summary ------------------------------------------ Chapter 15 Petitioner: Chetah Shah Chapter 15 Debtor: Ashapura Minechem Ltd. c/o Baker & McKenzie LLP 1114 Avenue of the Americas New York, NY 10036 Tel: (212) 626-4100 Chapter 15 Case No.: 11-14668 Type of Business: The debtor is a mine owner and exporter of bentonite. It is based in India and has activation, milling and processing plants all over the country. Chapter 15 Petition Date: October 4, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Chapter 15 Petitioner's Counsel: Ira A. Reid, Esq. BAKER & MCKENZIE 1114 Avenue of the Americas New York, NY 10036 Tel: (212) 891-3976 Fax: (212) 310-1600 E-mail: ira.a.reid@bakernet.com Estimated Assets: $100,000,001 to $500,000,000 Estimated Debts: $100,000,001 to $500,000,000 The Company did not file a list of creditors together with its petition. AUTOMASTERS LLC: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Automasters, LLC dba Autolife dba Tuneup Masters 10700 Civic Center Dr. Suite 100B Rancho Cucamonga, CA 91730 Bankruptcy Case No.: 11-16492 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Southern District of California (San Diego) Judge: Peter W. Bowie Debtor's Counsel: Michael T. O'Halloran, Esq. LAW OFFICE OF MICHAEL T. O'HALLORAN 1010 Second Avenue, Ste. 1727 San Diego, CA 92101 Tel: (619) 233-1727 Fax: (619) 233-6526 E-mail: mto@debtsd.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/casb11-16492.pdf The petition was signed by P. Moore, manager. B&G GROUP: Owner Puts Biz in Ch. 11, Files Personal Bankruptcy -------------------------------------------------------------- Robert Digitale at the Press Democrat reports that Healdsburg, California real estate investor Lukhbir Gill has filed bankruptcy before the U.S. Bankruptcy Court in Santa Rosa, California, to restructure his debts. Mr. Digitale notes the cracks in Mr. Gill's business empire began to appear this summer. The Gills filed personal bankruptcy (Bankr. N.D. Calif. Case No. 11-12703) on July 18, 2011. One week later, Fast Lane Central Valley LLC (Bankr. N.D. Calif. Case No. 11-12780) filed for Chapter 11. B&G Group Inc. (Bankr. N.D. Calif. Case No. 11-13481) followed suit on Sept. 20, 2011. B&G owes at least $12.9 million to its 20 largest creditors, and reported assets of between $1 million to $10 million. Fast Lane listed nearly $8 million in debts and $3.5 million in assets. Mr. Gill and his wife, Christina, listed debts of $25.8 million and assets of nearly $2.8 million. The report notes some lenders appear as creditors in all three cases. Judge Alan Jaroslovsky presides over the case. John H. MacConaghy, Esq., at MacConaghy and Barnier, PLC, represents the Gills and B&G. The Law Offices of Michael C. Fallon, Esq., represents Fast Lane. BALDWIN TECHNOLOGY: Delays Report Amid Refinancing Talks -------------------------------------------------------- Dow Jones' DBR Small Cap reports that Baldwin Technology Co. is delaying an annual regulatory filing because of ongoing refinancing negotiations. About Baldwin Technology Baldwin Technology Company, Inc. -- http://www.baldwintech.com/-- is an international supplier of process automation equipment for the printing and publishing industries. Baldwin offers its customers a broad range of market-leading technologies, products and systems that enhance the quality of printed products and improve the economic and environmental efficiency of printing presses. Headquartered in Shelton, Connecticut, the company has operations strategically located in the major print markets and distributes its products via a global sales and service infrastructure. Baldwin's technology and products include cleaning systems, fluid management and ink control systems, web press protection systems and drying systems and the related consumables. Waiver As reported in the May 20, 2011 edition of the TCR, Baldwin Technology disclosed it has negotiated an amendment and waiver to its credit facility with Bank of America. An exec. said that as part of the deal, the parties jointly established new appropriate covenant targets extending through the remainder of the term of the credit facility. CEO Mark Becker said Baldwin is on track to successfully refinance its existing credit facility prior to its maturity in November. BANK OF AMERICA: May Face Fraud Claims for Defective Loans ---------------------------------------------------------- Bank of America Corp. should face fraud claims after its Countrywide unit submitted faulty borrower data for federally insured mortgages, according to a Sept. 30 report from the Office of the Inspector General for the Department of Housing and Urban Development. About Bank of America Based in Charlotte, North Carolina, Bank of America -- http://www.bankofamerica.com/-- is one of the world's largest financial institutions. The Company serves more than 59 million consumer and small business relationships with more than 6,100 retail banking offices, nearly 18,700 ATMs and online banking with nearly 29 million active users. Following the acquisition of Merrill Lynch in January 2009, BofA is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes serving corporations, governments, institutions and individuals around the world. Bank of America offers support to more than 4 million small business owners. The Company serves clients in more than 150 countries. Bank of America Corporation stock is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange. BofA sought government backing in completing its acquisition of Merrill Lynch. Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth management, capital markets and advisory companies with offices in 40 countries and territories. During the economic collapse in 2008, BofA received a $45 billion bailout from the U.S. government. On June 17, 2011, 34 individuals sought to place Bank of America N.A. in bankruptcy by filing an involuntary Chapter 11 petition (Bankr. D. Colo. Case No. 11-24503). The petitioners claimed to be owed roughly $60 million in the aggregate. The petitioners identified themselves in the signature pages of the Chapter 11 petition as members of either the "Independent Rights Political Party" or the "Independent Rights Party." The petition was dismissed later that month. The New York Times reported in September 2011 that lawsuits against Bank of America related to its acquisition of Merrill Lynch are quietly advancing in the Federal District Court in Manhattan. The actions were commenced by the New York attorney general's office and by some of the largest class-action law firms seeking about $50 billion. BARBETTA LLC: Can Access Cash Collateral Until Nov. 29 ------------------------------------------------------ The Hon. J. Rich Leonard of the U.S. Bankruptcy Court for the Eastern District of North Carolina authorized, in a fourth interim order, Barbetta, LLC, to use its creditors' cash collateral. The Court will consider the Debtor's access to the cash collateral beyond the fourth interim period, at a hearing on Nov. 29, at 10:00 a.m. Each creditor asserts that rental income and other cash proceeds generated by the Debtor's properties securing the claims of the creditor constitutes the cash collateral of the creditor. The Debtor will use the cash collateral to fund the operating expenses of owning, operating, managing and maintaining the Debtor's properties. The Court also ordered that the Debtor (a) will maintain at least one Debtor-in-Possession bank account for each creditor, into which they will deposit all cash, checks, and other cash items generated by the Debtor's properties securing the claims of the creditor, and (b) will segregate and hold separate the cash collateral of each creditor in each separate DIP account maintained for each creditor. The Debtor's tenants are directed to pay all future rent payments directly to the Debtor. About Barbetta, LLC Based in Selma, North Carolina, Barbetta, LLC -- formerly doing business as Hester 1996 Family Limited Partnership, South Pollock Street Development & Sign Co., LLC, Hester 5, LLC, and Hester 8, LLC -- filed for Chapter 11 bankruptcy (Bankr. E.D.N.C. Case No. 11-04370) on June 6, 2011. Judge J. Rich Leonard presides over the case. Trawick H. Stubbs, Jr. and Stubbs & Perdue, P.A., represents the Debtor in its restructuring efforts. The Debtor tapped Charles E. Hester, as member-manager of the Debtor, and the accounting firm of David J. Bradley, CPA, as accountants. In its schedules filed together with the petition, the Debtor disclosed $24,889,321 in total assets and $12,855,596 in total liabilities. The petition was signed by Charles E. Hester, member manager. Charles and Barbetta Hester also filed a separate Chapter 11 petition (Bankr. E.D.N.C. Case No. 11-04375) on June 6, 2011 BERNARD L. MADOFF: Picard Fights Bid to Dismiss Suit v. Kohn ------------------------------------------------------------ Michael Rothfeld, writing for The Wall Street Journal, reports that a lawyer for Bernard L. Madoff trustee Irving Picard tried to convince U.S. District Judge Jed Rakoff in Manhattan on Wednesday not to toss out claims Mr. Picard has made in a nearly $59 billion civil suit against Austrian banker Sonja Kohn and dozens of others under a federal law normally used against traditional criminal organizations such as the Mafia and drug gangs. Mr. Picard has alleged that Mrs. Kohn, a longtime associate of Mr. Madoff who created Bank Medici AG, and others conspired beginning in 1985 to funnel $9 billion to Mr. Madoff through six foreign feeder funds in a secret illegal scheme the trustee dubbed "the Medici Enterprise." The Journal says the lawsuit against Mrs. Kohn is seeking the extraordinary amount based on a provision in the Racketeer Influenced and Corrupt Organizations Act that allows plaintiffs to seek triple the damages they claim -- in this case the entire $19.6 billion the trustee had earlier said investors lost in Mr. Madoff's scheme. Mr. Picard has since reduced his estimate to $17.3 billion. According to the Journal, some of the defendants who had business relationships with Mrs. Kohn, including Italian bank UniCredit SpA, its subsidiaries and others, have accused Mr. Picard of overreaching and asked that his claims filed under the RICO Act be dismissed. They cited various court precedents they said barred him from bringing the case. The report relates David Sheehan, Esq., Mr. Picard's counsel, told the judge that he knew he faced significant legal obstacles in defending the trustee's use of the law. But Mr. Sheehan said employing it against what Mr. Picard alleges was the enterprise masterminded by Mrs. Kohn is consistent with what Congress intended, and he should be allowed at least to continue with the case. "We should at least have an opportunity to develop these facts, these very strong and compelling facts," Mr. Sheehan said. According to the Journal, Mrs. Kohn hasn't formally responded to the lawsuit in court. The report relates a lawyer representing her in Vienna, Clemens Trauttenberg, said Mr. Picard "doesn't offer any single piece of evidence that Mrs. Kohn had either knowledge or was part of the Ponzi scheme, and he will never be able to find something because it doesn't exist." The Journal also reports that UniCredit and others have contended Mr. Picard's RICO claims should be dismissed in light of a Supreme Court decision last year saying the law can't be used to target a primarily foreign enterprise; many of Mrs. Kohn's associates were in Europe. They also cited a Congressional amendment barring RICO from being applied to securities-fraud allegations, and a legal principle that says one bad actor can't sue another. The defendants' lawyers said Mr. Picard, because he is the trustee for the investment firm where the Ponzi scheme took place, in effect represents Mr. Madoff. The Journal recounts that since July, Judge Rakoff has thrown out two other legal theories -- and billions of dollars in claims -- in lawsuits filed by the trustee: -- In September, Judge Rakoff ruled in a case involving the owners of baseball's New York Mets that Mr. Picard was only permitted to recover allegedly false profits withdrawn by former Madoff customers in the two years prior to the end of the Ponzi scheme, not the prior six years as Mr. Picard had attempted. He also said the trustee couldn't take principal investors withdrew within the last 90 days of the scheme. According to the Journal, Mr. Picard's representatives have said those findings, if applied to other lawsuits, would eliminate $6.2 billion of his claims. -- In July, Judge Rakoff threw out a total of $8.6 billion in claims Mr. Picard made against HSBC Bank PLC, Unicredit and other defendants using common law, or law based on past court decisions. He ruled that only former customers of Mr. Madoff could make those claims. The trustee has indicated he may try to appeal the unfavorable decisions. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On 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 July 15, 2011, a total of US$6.88 billion in claims by investors has been allowed, with US$794.9 million to be paid by the Securities Investor Protection Corp. Investors are expected to receive additional distributions from money recovered by Mr. Picard from lawsuits or settlements. BERNARD L. MADOFF: UniCredit Wants to Nix Racketeering Claims ------------------------------------------------------------- Richard Vanderford at Bankruptcy Law360 reports that UniCredit SpA and an affiliate on Wednesday pressed a New York federal judge to throw out racketeering claims in the $59 billion suit filed by Bernard L. Madoff's bankruptcy trustee, saying they didn't participate in the fraud. According to Law360, lawyers for UniCredit SpA and affiliate UniCredit Bank Austria AG contend that claims Irving Picard brought against them under the Racketeer Influenced and Corrupt Organizations Act for allegedly helping Austrian banker Sonja Kohn funnel investors' money into Madoff's Ponzi scheme are far-fetched and should be thrown out. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On 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 July 15, 2011, a total of US$6.88 billion in claims by investors has been allowed, with US$794.9 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. BESO LLC: Court Approves Sale to Landry's Restaurant for $1 Mil. ---------------------------------------------------------------- Tim O'Reiley at Las Vegas Review-Journal reports that the influence exerted by Crystals retail mall management proved decisive in gaining U.S. Bankruptcy Court approval on Oct. 3, 2011, to sell Beso restaurant to a group headed by Landry's Restaurants for $1 million. The report says the half-interest that will go to Landry's, which also owns the Golden Nugget, did not trigger any objections. Instead, the inclusion of a 30% interest to actress Eva Longoria and 20% to Jonas Lowrance, both part of the current ownership, triggered the wrath of two other minority owners who will be frozen out, the report adds. However, the report continues, in the written ruling that approved the Landry's deal, U.S. Bankruptcy Court Judge Mike Nakagawa noted that none of this mattered nearly as much as "the proverbial elephant in the courtroom: Crystal's ability to demand Beso's immediate surrender of the premises." Under bankruptcy law, the original lease had terminated during the case, so Crystals could have shut down Beso at any time. About Beso LLC Beso LLC, co-owned by "Desperate Housewives" star Eva Longoria, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11-10202) on Jan. 6, 2011. Beso LLC runs a Las Vegas restaurant that opened two years ago. It disclosed assets of $2,512,007 and liabilities of $5,680,339 in the schedules attached to the Chapter 11 petition. Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, in Las Vegas, Nevada, serves as counsel to the Debtor. The petition was signed by William M. Braden, manager. BLAKELY PARTNERS: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Blakely Partners LLC, Debtor Suite 275, 5887 Glenridge Drive Atlanta, GA 30328 Bankruptcy Case No.: 11-78898 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: David G Bisbee, Esq. LAW OFFICE OF DAVID G. BISBEE 2929 Tall Pines Way Atlanta, GA 30345 Tel: (770) 939-4881 Fax: (770) 783-8595 E-mail: bisbeed@bellsouth.net Scheduled Assets: $8,517,900 Scheduled Debts: $4,446,751 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Eric Nathan, manager. C&D TECHNOLOGIES: Angelo Gordon Buys Business for $9.75 Per Share ----------------------------------------------------------------- C&D Technologies, Inc., announced the signing of a definitive merger agreement, pursuant to which C&D will be acquired by an affiliate of Angelo, Gordon & Co., in an all-cash transaction for $9.75 per share. The deal is expected to close in the fourth quarter of this calendar year. The transaction is not subject to a financing condition. Under the terms of the merger agreement, each outstanding share of C&D common stock not owned by Angelo, Gordon & Co., or its affiliates will be converted into the right to receive $9.75 in cash, subject to the terms and conditions of the merger agreement. Shareholders affiliated with Angelo, Gordon & Co., who hold approximately 65% of the outstanding shares of C&D's common stock have executed a written consent to approve the transaction, thereby providing the required stockholder approval for this transaction. As a result, no further action by other stockholders of C&D is required to approve the transaction, but consummation of the transaction remains subject to certain closing conditions as set forth in the merger agreement. The merger agreement was unanimously recommended by a special committee of the C&D Board of Directors and was then approved by C&D's full Board of Directors. Potter Anderson & Corroon LLP serves as legal counsel and Perella Weinberg Partners LP acts as financial advisor to the special committee of the Board of Directors of C&D. Willkie Farr & Gallagher LLP serves as legal counsel to C&D. Simpson Thacher & Bartlett LLP serves as legal counsel and Houlihan Lokey serves as financial advisor to Angelo, Gordon & Co. About C&D Technologies C&D Technologies, Inc., is a manufacturer, marketer and distributor of electrical power storage systems for the standby power storage market. The Company makes lead acid batteries and standby power systems that integrate lead acid batteries with other electronic components, which are used to provide backup or standby power for electrical equipment in the event of power loss from the primary power source. The Company reported a net loss of $55.55 million on $354.83 million of net sales for the fiscal year ended Jan. 31, 2011, compared with a net loss of $25.78 million on $335.71 million of net sales during the prior fiscal year. The Company's balance sheet at July 31, 2011, showed $251.29 million in total assets, $156.23 million in total liabilities, and $95.05 million in total equity. C&D Technologies in December 2010 escaped a bankruptcy filing after completing an out-of-court restructuring that reduced the Company's total debt from approximately $175 million to $50 million. The Company in September had entered into a restructuring support agreement with noteholders to a restructuring that will be effected through (i) an offer to exchange the Company's outstanding notes for up to 95% of the Company's common stock, or (ii) a prepackaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code, if the exchange offer fails to get the requisite support. C&D Technologies elected not to make a semi-annual interest payment due on its 5.25% Convertible Senior Notes due 2025 on Nov. 1, 2010. CABI SMA: Court Approves Berman Rennert as Property Tax Counsel --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized Cabi SMA Tower I, LLLP, to employ Jeffrey L. Mandler and his firm Berman Rennert Vogel & Mandler, P.A., as its property tax counsel. According to the Troubled Company Reporter on Sept. 6, 2011, as the Debtor's property tax counsel, Berman Rennert will prosecute previously-filed petitions regarding the 2009 and 2010 property tax assessments issued by the Miami-Dade Property Tax Appraiser's Office, and prosecute 2011 Abatement Petitions challenging tax assessments issued by the Property Tax Appraiser's Office. Berman Rennert will be paid for its services relating to tax years 2009, 2010, and 2011 on a contingent basis in the amount of one- third (33.33%) of the actual property tax savings realized by the Debtor. Berman Rennert will not earn any compensation for its work unless and until a "benefit" is received by the Debtor. The term "Tax Savings" will mean the difference between taxes payable after the reduction in assessment of a particular property and the taxes that would have been payable had no reduction been achieved, plus any interest, any penalties, and any costs awarded with respect thereto. The fee arrangement encompasses any services rendered in connection with representing the Debtor for the submission of the Debtor's Abatement Petitions pursuant to the Property Tax Appraiser's Office's established formal or informal procedures, but does not include representation for any potential administrative appeals of the Value Adjustment Board's determinations. If the Debtor asks that Berman Rennert either prosecute or defend an appeal to the Circuit Court of a Value Adjustment Board result, Berman Rennert will be paid an additional fee, which is yet to be determined when the payment becomes necessary. Jeffrey L. Mandler, Esq., a shareholder at Berman Rennert Vogel & Mandler, P.A., in Miami, Florida -- jmandler@brvmlaw.com -- disclosed that Berman Rennert performed prepetition property tax services with respect to the 2009 real property taxes of an affiliate of the Debtor, Cabi New River, LLC. Cabi New River has also filed for Chapter 11 bankruptcy relief and its case is pending before the Court as Case Number 10-49013. Berman Rennert also has provided, or may provide, property tax services to affiliates of the Debtor, including, but not limited to, Chapter 11 Debtor Cabi Downtown LLC, whose post-confirmation bankruptcy case is still pending before the Court as Case No. 09-27168, and Cabi New River. Berman Rennert received a pro rata distribution in the Cabi Downtown bankruptcy case on account of its general unsecured claim for property tax services rendered prepetition to Cabi Downtown, he relates. Despite those disclosures, Berman Rennert is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, Mr. Mandler insists. About Cabi SMA Tower I Based in Miami, Florida Cabi SMA Tower I, LLLP -- fka Cabi SMA Retail 1, LLC; Cabi SMA, LLLP; Cabi SMA Tower 2, LLC; Cabi SMA Tower 2, LLLP; Capital at Brickell; Cabi SMA Retail 2, LLLP; Cabi SMA Retail 2, LLC; Cabi SMA Tower 1, LLC; and Cabi SMA Retail I, LLLP -- owns multiple vacant parcels around South Miami Avenue and S.W. 14th Street in Miami, Florida. It acquired the parcels to develop residential, hotel, and retail space, including a condominium development. The parcels are being managed by Cabi Developers, LLC pursuant to a management agreement. Cabi SMA Tower I filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 10-49009) on Dec. 28, 2010. Mindy A. Mora, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates Cabi Downtown, LLC (Bankr. S.D. Fla. Case No. 09-27168) and Cabi New River, LLC (Bankr. S.D. Fla. Case No. 10-49013) filed separate Chapter 11 petitions. No creditor's committee has been appointed in Cabi SMA Tower I, LLLP's Chapter 11 case. On April 27, 2011, Cabi SMA Tower I, LLLP filed its First Amended Plan of Reorganization and an accompanying disclosure statement. CASCADE BANCORP: LaMont Keen Elected to Board of Directors ---------------------------------------------------------- Patricia L. Moss, president and chief executive officer of Cascade Bancorp and Bank of the Cascades, announced that J. LaMont Keen has been elected to the Board of Directors of the Cascade Bancorp and Bank of the Cascades, subject to regulatory approval. LaMont Keen has been President and Chief Executive Officer of IDACORP, a holding company of Idaho Power Company, since July of 2006. His past experience for IDACORP and Idaho Power Company includes serving as Chief Executive Officer, President, Chief Operating Officer, and Chief Financial Officer. Keen joined Idaho Power in 1974 and, over the course of his career, was actively involved at either the officer or director level in the company's diversified business ventures and played a vital role in developing IDACORP's and Idaho Power's subsidiaries. In addition to his professional responsibilities, LaMont Keen is involved in several civic and professional activities in Boise, Idaho. He has served on the Board of Directors of IDACORP and Idaho Power since July 2004. He also is a board member of the Edison Electric Institute and is a board member and former chairman of the Western Energy Institute and the Idaho Association of Commerce and Industry. In the community, Keen currently serves as a board member on the St. Luke's Hospital System Treasure Valley Board and is a former board member of Community House, serving the indigent population. He is also a board member of the Arid Club in Boise. Keen holds a BBA in Accounting from the College of Idaho and completed the Harvard Graduate School of Business Advanced Management Program. Patricia L. Moss commented, "We are very pleased to add J. LaMont Keen to our Board of Directors. The scope and depth of his board experience, as well as his executive, operational and fiscal management experience, will provide valuable insight and guidance for our Company. In addition, his extensive involvement with and deep understanding of Idaho's business landscape and markets will provide unique perspective as we continue to develop ways in which to better serve our Company's communities in Idaho's Treasure Valley region." About Cascade Bancorp Bend, Ore.-based Cascade Bancorp (Nasdaq: CACB) through its wholly-owned subsidiary, Bank of the Cascades, offers full-service community banking through 32 branches in Central Oregon, Southern Oregon, Portland/Salem Oregon and Boise/Treasure Valley Idaho. Cascade Bancorp has no significant assets or operations other than the Bank. Weiss Ratings has assigned its E- rating to Bend, Ore.-based Bank of The Cascades. The rating company says that the institution currently demonstrates what it considers to be significant weaknesses and has also failed some of the basic tests it uses to identify fiscal stability. "Even in a favorable economic environment," Weiss says, "it is our opinion that depositors or creditors could incur significant risks." As of March 31, 2010, the bank's balance sheet showed $2.088 billion in assets. The Company reported a net loss of $13.65 million on $84.98 million of total interest and dividend income for the year ended Dec. 31, 2010, compared with a net loss of $114.83 million on $106.81 million of total interest and dividend income during the prior year. The Company's balance sheet at June 30, 2011, showed $1.56 billion in total assets, $1.35 billion in total liabilities, and $212.61 million of stockholders' equity. CAVIATA ATTACHED: U.S. Bank Wants Stay Relief or Case Dismissal --------------------------------------------------------------- U.S. Bank National Association, as successor-in-interest to the Federal Deposit Insurance Corporation, receiver for California National Bank -- the Senior Lender -- asks the U.S. Bankruptcy Court for the District of Nevada for relief from the automatic stay or, in the alternative, for the dismissal of the Chapter 11 case of Caviata Attached Homes LLC. This is the second Chapter 11 cases filed by the Debtor in the last two years and comes just seven months after the order approving the Debtor's Chapter 11 plan became a final order. The Debtor's first Chapter 11 case, Case No. 09-52786, was never closed and remains pending before the Court, Amy N. Tirre, Esq., at Law Offices of Amy N. Tirre, PC, in Reno, Nevada, notes. This second filing is an improper and backdoor attempt by the Debtor to circumvent the Bankruptcy Code's prohibition on modifying a substantially consummated plan, Ms. Tirre contends. Moreover, as admitted by the Debtor, the Senior Lender's collateral has deteriorated in value since the first Chapter 11 bankruptcy case and continues to deteriorate. The Debtor is not adequately protecting the Senior Lender's interests, she tells the Court. The Senior Lender has been prevented from foreclosing on its collateral for the last two years while the Debtor has permitted the collateral to deteriorate in value and has not made any progress in alleviating its financial struggles, Ms. Tirre complains. Ms. Tirre asserts that cause exists to grant the Senior Lender relief from the automatic stay because (i) Senior Lender's interest in its collateral is not adequately protected and (ii) the Debtor does not have any equity in that property, and the property is not necessary to an effective reorganization. The Debtor's games should not be condoned and Senior Lender should be granted relief from the automatic stay or, in the alternative, the second Chapter 11 case should be dismissed, Ms. Tirre says. About Caviata Attached Homes Reno, Nevada-based Caviata Attached Homes LLC filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case No. 11-52458) on Aug. 1, 2011. Judge Bruce T. Beesley presides over the case. The Law Offices of Alan R. Smith, Esq., serves as bankruptcy counsel. According to its schedules, the Debtor disclosed $22,775,701 in total assets and $42,322,448 in total debts. The petition was signed by William D. Pennington, II, member of Caviata 184, LLC. There was a prior bankruptcy filing by Caviata Attached Homes (Bankr. D. Nev. Case No. 09-52786) on Aug. 18, 2009, also estimating $10 million to $50 million in both assets and debts. Alan R. Smith, Esq., also represented the 2009 Debtor. CCS MEDICAL: Moody's Affirms 'B3' Corporate Family Rating --------------------------------------------------------- Moody's Investors Service affirmed CCS Medical, Inc.'s B3 corporate family and probability of default ratings. Moody's also affirmed the B3 rating on the first lien senior secured term loan due 2015 and the Caa2 rating on the paid-in-kind ("PIK") second lien senior secured term loan due 2015. The ratings outlook was revised to negative from stable. Ratings affirmed: Corporate family rating at B3; Probability of default rating at B3; $149 million first lien senior secured term loan due 2015 at B3. Point estimate revised to (LGD3, 44%) from (LGD3, 47%); $55 million PIK second lien senior secured term loan due 2015 at Caa2. Point estimate revised to (LGD5, 87%) from (LGD5, 88%). RATINGS RATIONALE The outlook revision reflects CCS Medical's weaker than expected operating performance (relative to Moody's expectations) since its emergence from bankruptcy in early 2010 due to a lack of growth in the patient base. In addition, revenue and EBITDA have deteriorated on a year-over-year basis in recent periods. However, the rating derives support from the company's efforts to reduce cost and bad debt expense, and exit unprofitable product categories that have partially offset the impact of lower sales. In addition, while Moody's views covenant cushion as modest, an amendment completed in June 2011 did increase flexibility under the maximum net leverage ratio that governs the first lien term loan. The B3 corporate family rating reflects CCS Medical's high leverage with debt to EBITDA exceeding 5.0 times, weak coverage of interest expense, and expectations for limited free cash flow generation medium-term. The rating also considers the company's relatively high reliance on governmental payors, as well as longer-term uncertainty surrounding the future impact of Centers for Medicare and Medicaid Services ("CMS") expanded competitive bidding process. Notwithstanding these concerns, the rating is supported by its business position as a large-scale provider of diabetes and chronic care supplies, good product diversification, the recurring nature of its revenues, ongoing cost reduction efforts, and favorable long-term demographics. The negative outlook reflects Moody's concern over CCS Medical's ability to improve its operating performance, and thus credit metrics, given challenges growing its patient base and continued reimbursement pressure. The ratings could be downgraded if CCS Medical's operating performance continues to weaken such that debt to EBITDA reaches 6.0 times, interest coverage metrics deteriorate, and/or a financial covenant breach appears likely. Sustained negative free cash flow could also result in a ratings downgrade. Moody's could revise CCS Medical's ratings outlook to stable if it generates a track-record of improved operating performance while maintaining an adequate liquidity profile. For further detail, refer to Moody's credit opinion for CCS Medical. CCS Medical's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside CCS Medical's core industry and believes CCS Medical's ratings are comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. CCS Medical, Inc., based in Clearwater, Florida, is a leading mail-order provider of medical supplies to diabetes and other chronically ill patients. The company reported revenues of $434 million for the twelve months ended June 30, 2011. CDC CORP: Legal Judgment Prompts Chapter 11 ------------------------------------------- Dow Jones' DBR Small Cap reports that CDC Corp. filed for Chapter 11 bankruptcy protection after a hedge fund investor won a $65.4 million judgment against it. Headquartered in Hong Kong, CDC Corp is a technology firm. CDC s a global provider of enterprise software, online games, and Internet and media services. CDC Corporation, doing business as Chinadotcom, filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 11-79079) on Oct. 4, 2011. James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout, PA, in Atlanta, Georgia, serves as counsel. The Debtor estimated assets and debts at $100 million to $500 million. CHEF SOLUTIONS: Judge Clears $9-Million DIP Loan ------------------------------------------------ Lance Duroni at Bankruptcy Law360 reports that U.S. Bankruptcy Judge Kevin Gross on Wednesday cleared Chef Solutions Holdings LLC to borrow $9M to fund operations as the Company gears up to sell its assets to a joint venture between a private equity firm and rival Reser's Fine Foods Inc. According to Law360, Judge Gross approved two debtor-in-possession loans -- which could be worth up to $38 million in final approval -- along with a slew of customary first-day motions at the hearing. About Chef Solutions Chef Solutions Inc., through subsidiary Orval Kent, is the second largest manufacturer in North America of fresh prepared foods for retail, foodservice and commercial channels. Chef Solutions and its affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-13139) on Oct. 4, 2011, in Delaware with the aim of selling the business to a joint venture between Mistral Capital Management LLC and Reser's Fine Foods Inc. The Debtor estimated assets and debts both exceeding $100 million. Judge Kevin Gross presides over the case. Lawyers at Richards, Layton & Finger, P.A., serve as the Debtors' bankruptcy counsel. Donlin Recano is the claims and notice agent. Piper Jaffray & Co. has been hired as investment banker. PriceWaterHousecoopers serves as financial advisor. CHUKCHANSI ECONOMIC: Moody's Lowers CFR to Caa2; Outlook Negative ----------------------------------------------------------------- Moody's Investors Service downgraded Chukchansi Economic Development Authority's corporate family rating and senior unsecured notes rating to Caa2 from B3. Moody's also lowered the probability of default rating to Caa1 from B2. The rating outlook remains negative. Ratings downgraded: -- Corporate Family Rating to Caa2 from B3 -- Probability of Default Rating to Caa1 from B2 -- $110 million Floating Rate Senior Notes due November 2012 rating to Caa2 (LGD4, 66%) from B3 (LGD4, 68%) -- $200 million 8% Senior Notes due November 2013 rating to Caa2 (LGD4, 66%) from B3 (LGD4, 68%) RATINGS RATIONALE The rating action is prompted by Moody's expectation that the Authority will face significant challenges in refinancing its senior notes that will mature in November 2012 and 2013, particularly in light of its high leverage and limited near-term prospects for improvement in business conditions and operating performance. If difficult credit market conditions persist, there is also a heightened risk that interest costs could increase materially from currently low levels, which would significantly dampen the Authority's free cash flow generation. Chukchansi also faces the increasing possibility of new competition, an on-going threat that could materialize in the near-to-medium term after the recent approval by the Bureau of Indian Affairs of a land-into- trust application for gaming purpose by the North Fork Rancheria Tribe for its site in Madera County, CA, which is approximately 30 miles away from Chukchansi's existing casino. "The Caa2 CFR and negative outlook reflect a high default probability due to increasing uncertainty surrounding Chukchansi's ability to refinance on a timely basis," commented Moody's lead analyst, John Zhao. Moody's views Chukchansi's short-term liquidity as weak because of its significant near-term debt maturities. Absent the maturities, liquidity is mainly supported by positive free cash flow generation which is benefiting in part from the low cost of interest afforded by the Authority's current capital structure. Ratings would likely be lowered if the Authority is unable to refinance in the near term or it pursues a recapitalization that Moody's considers to be a distressed exchange. A higher rating is unlikely at this time. An outlook revision to stable, however, would require that Chukchansi refinance timely and on economical terms, as well as maintain stable operating performance and sufficient liquidity. The Chukchansi Economic Development Authority ("Chukchansi" or "the Authority") was formed in June 2001 as a wholly owned enterprise of the Picayune Rancheria of Chukchansi Indians (the "Tribe"), a federally-recognized Indian tribe with approximately 1,250 enrolled members. Chukchansi has operated since June 2003 the Chukchansi Gold Resort & Casino, a facility located 35 miles north of Fresno, California. The facility features a 404-room hotel, 2,000 class III slot machines, approximately 42 class III table games and seven restaurants. The principal methodology used in rating Chukchansi Economic Development Authority was the Global Gaming Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. CITY LOFT HOTEL: Files for Chapter 11 to Restructure Debt --------------------------------------------------------- Erin Moody at the Beaufort (S.C.) Gazette reports that City Loft Hotel filed for Chapter 11 bankruptcy on Sept. 30, 2011, so it can restructure its debt. The hotel remains open for business. The report relates owner Matt McAlhaney said he took out a loan with a local bank that failed in 2010, and the debt has been shuttled to various out-of-state lenders since then. "For quite some time now, City Loft has made repeated offers to service debt under reasonable terms, including offers of escrowed money to the banks' favor, with no success," Mr. Williams said. The hotel has no cash-flow problems, he added. According to the report, Mr. Williams declined to name the banks involved, but the bankruptcy filings show the largest loan, for $4.2 million, is held by Bank of the Ozarks in Arkansas. CITY LOFT HOTEL: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: City Loft Hotel, LLC 301 Carteret Street Beaufort, SC 29902 Bankruptcy Case No.: 11-06127 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: David R. Duncan Debtor's Counsel: Michael W. Mogil, Esq. LAW OFFICE OF MICHAEL W. MOGIL, P.A. 2 Corpus Christie Place, Ste. 303 Hilton Head Island, SC 29928 Tel: (843) 785-8110 Fax: (843) 785-9676 E-mail: mwmogil@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/scb11-06127.pdf The petition was signed by Matthew S. McAlhaney, president. CITY LOFT, LLC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: City Loft, LLC P.O. Box 1539 Beaufort, SC 29902 Bankruptcy Case No.: 11-06160 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: David R. Duncan Debtor's Counsel: Robert G. Sable, Esq. LAW OFFICE OF MICHAEL W. MOGIL, PA 2 Corpus Christie Place, Suite 303 Hilton Head Island, SC 29928 Tel: (843) 785-8110 E-mail: rsable@mogillaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/scb11-06160.pdf The petition was signed by Matthew S. McAlhaney, president. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- City Loft Hotel, LLC 11-06127 09/30/11 CLEAN BURN: Court Ends Cash Collateral Use as of July 18 -------------------------------------------------------- Judge Thomas Waldrep of the U.S. Bankruptcy Court for the Middle District of North Carolina rules that the use of Cash Collateral as authorized in prior orders terminated as of July 18, 2011, except (i) to the extent authorized by the prior orders for payment of "permitted trailing expenses", (ii) for the retention of $250,000 by the Debtor pursuant to the compromise and settlement, and (iii) for the retention of $67,403 by the Debtor for payment of ABTV pursuant to the surcharge granted under Section 506(c) of the Bankruptcy Code. Judge Waldrep also orders that no further use of cash collateral is authorized. About Clean Burn Clean Burn Fuels LLC, a North Carolina limited liability company founded in 2005, is the first company to produce ethanol in North Carolina. It completed the construction of its ethanol plant in August of 2010 and started producing and selling ethanol and dried distillers grains with solubles (DDGS) shortly thereafter. Clean Burn filed for Chapter 11 bankruptcy protection (Bankr. M.D.N.C. Case No. 11-80562) on April 3, 2011. John A. Northen, Esq., at Northen Blue, L.L.P., represents the Debtor. In its schedules of assets and liabilities, the Company disclosed $79,516,062 in assets and $79,218,681 in liabilities. The schedules valued its ethanol plant at $72,000,000, securing at $66,225,571 claim by a lender. The Official Committee of Unsecured Creditors is represented by Charles M. Ivey, III, Esq., at Ivey McClellan Gatton & Talcott, LLP, in Greensboro, North Carolina. CLINTON COURT: Brooklyn Mixed-Use Building Files for Ch. 11 ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Clinton Court Development LLC, the owner of a 13-story mixed-use building on Clinton Avenue in Brooklyn filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 11-14673) on Oct. 5 in Manhattan, claiming the property is worth about $17 million. Mortgages total roughly $42.3 million. The primary secured creditor is TD Banknorth. The bankrupt company also owns a two-story commercial building on Waverly Avenue in Brooklyn. COMPETITIVE TECHNOLOGIES: Signs Factoring Agreement with Versant ---------------------------------------------------------------- Competitive Technologies, Inc., on Sept. 28, 2011, entered into a Factoring Agreement with Versant Funding LLC. Under the Factoring Agreement CTTC will sell to Versant certain of CTTC's accounts receivables. For those accounts receivable CTTC tenders to Versant and Versant chooses to purchase, Versant will advance 75% of the face value to CTTC, and will submit a percentage of the remainder to CTTC upon collection on the account based on the delinquency of the account. As part of the Factoring Agreement, CTTC and Versant entered into a Security Agreement whereby CTTC granted Versant a security interest in certain of CTTC's assets to secure CTTC's performance of the representations made with respect to the purchase of the accounts receivable. The agreements were fully executed on Sept. 28, 2011, and effective as of Sept. 9, 2011. About Competitive Technologies Fairfield, Conn.-based Competitive Technologies, Inc. (OTC QX: CTTC) -- http://www.competitivetech.net/-- was established in 1968. The Company provides distribution, patent and technology transfer, sales and licensing services focused on the needs of its customers and matching those requirements with commercially viable product or technology solutions. Sales of the Company's Calmare(R) pain therapy medical device continue to be the major source of revenue for the Company. The Company's balance sheet at June 30, 2011, showed $5.27 million in total assets, $5.29 million in total liabilities, all current, and a stockholders' deficit of $16,629. As reported in the Troubled Company Reporter on Nov. 2, 2010, Mayer Hoffman McCann CPAs, in New York, expressed substantial doubt about Competitive Technologies' ability to continue as a going concern, following the Company's results for the fiscal year ended July 31, 2010. The independent auditors noted that at July 31, 2010, the Company has incurred operating losses since fiscal year 2006. CONSYS CONCRETE: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Consys Concrete Corp. 11010 Switzer Ave., Ste. 104 Dallas, TX 75238 Bankruptcy Case No.: 11-36156 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Barbara J. Houser Debtor's Counsel: Darryl V. Pratt, Esq. 2595 Dallas Parkway, Ste 105 Frisco, TX 75034 Tel: (972) 712-1515 Fax: (972) 712-2832 E-mail: dpratt@dprattlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txnb11-36156.pdf The petition was signed by Darold J. Molix, president. CROSSOVER FINANCIAL: Bank Wants Chapter 11 Case Dismissed --------------------------------------------------------- First Regional Bank asks the U.S. Bankruptcy Court for the District of Colorado to dismiss the Chapter 11 case of Crossover Financial LLC, citing that the Debtor has no employees, no ongoing business operations, and minimal, if any, monthly income. The bank adds that the Debtor has not filed its monthly operating reports for June and July 2011 and has not provided these reports to the U.S. Trustee. William A. Richey, Esq., at Weinman & Associates P.C. represents the bank. Crossover Financial I, LLC, based in Elizabeth, Colorado, filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 11-24257) on June 15, 2011. Judge Sidney B. Brooks presides over the case. Stephen C. Nicholls, Esq., at Nicholls & Associates, P.C., serves as bankruptcy counsel. In its petition, the Debtor estimated assets and debts of $10 million to $50 million. The petition was signed by Mitchell B. Yellen. Charles F. Mcvay, The United States Trustee for Region 19, said that a committee under 11 U.S.C. Sec. 1102 has not been appointed because an insufficient number of persons holding unsecured claims against Crossover Financial I, LLC have expressed interest in serving on a committee. DALLAS STARS: Seeks to Employ KPMG as Auditors ---------------------------------------------- Dallas Stars, L.P., and its debtor affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ KPMG LLP as their auditor, tax advisor, and bankruptcy administration consultant, nunc pro tunc to the Petition Date. Pursuant to the engagement letters, KPMG will provide these services: (a) Audit Services: * Audit the consolidated financial statements of the Debtors and related consolidated statements of operations, partners' deficit and cash flows; * Perform tests of the accounting records and other procedures; and * Assess the accounting principles used and significant estimates made by management, and evaluate the overall consolidated financial statement presentation; (b) Hockey Related Revenue Reporting Package Services: * Apply the agreed-upon procedures in the Hockey Related Revenue Reporting Package to the indicated accounts of the Debtors; and * Assist the Debtors in connection with the HRR Reporting Package requirements; (c) Tax Compliance Services: * Prepare state and local partnership tax returns and supporting schedules for the Debtors' 2010 tax year; * Plan activities related to the tax returns for the immediately succeeding 2011 tax year; * Prepare pro-forma federal partnership tax returns and supporting schedules for Dallas Stars, Dallas Arena, and StarCenters for the 2010 tax year; and * Prepare federal corporate tax return and supporting schedules for U.S. Holdings, for the 2010 tax year; (d) Tax Consulting Services: * Work with the Debtors to resolve the Texas State Comptroller's examination for the 2007 and 2008 report years; * Work with the Debtors to develop strategy for best handling the Examination; * Assist the Debtors in preparing submissions in response to the Comptroller's inquiries; and * Provide general tax consulting services that may arise for which the Debtors seek KPMG's advice; and (e) Bankruptcy Administration Services: * Provide advice, recommendations, and insight into leading practices based on KPMG's experience to assist management in its preparation of information required to prepare motions to be filed with the bankruptcy court and with its operational protocols for bankruptcy reporting; * Lead the development and preparation of the Statement of Financial Affairs, the Schedule of Assets and Liabilities, Monthly Operating Reports, and other reporting to the court, as necessary; and * Provide advice and recommendations to assist management in the preparation of information required in the disclosure statement and plan of reorganization, among other services. KPMG will be paid based on its standard hourly rates and will be reimbursed for its necessary expenses. The hourly rates for audit, tax compliance, tax consulting, and bankruptcy administration consulting services to be rendered by KPMG are: Tax Compliance and Tax Consulting Services ------------------------------------------ Partners $540 - $565 Senior Managers $475 Managers $370 - $400 Senior Associates $265 - $300 Associates $210 - $225 Bankruptcy Administration Services ---------------------------------- Partners/Principals/ $500 - $600 Managing Directors Managers/Directors $350 - $500 Senior Associates/ $200 - $350 Associates Para-Professionals $100 - $200 Professional fees for bankruptcy administration services will not exceed a blended hourly rate of $425, tested on a monthly basis. The Debtors paid KPMG $378,152 in the 90-day period prior to the Petition Date. As of the Petition Date, KPMG did not hold a prepetition claim against the Debtors for services rendered in connection with the Engagement Letters, if any. G. R. Christon, a managing director of KPMG, attests that KPMG is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A hearing will be held on Oct. 17, 2011, to consider the application. Objections are due on Oct. 11. About Dallas Stars Frisco, Texas-based Dallas Stars, L.P. -- http://stars.nhl.com/-- operates as a professional men's ice hockey team. The company was formerly known as Minnesota North Stars and changed its name to Dallas Stars, L.P. in 1993. Dallas Stars and three affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-12935 to 11-12938) on Sept. 15, 2011. The affiliates are Dallas Arena LLC, Dallas Stars U.S. Holdings Corporation, and StarCenters LLC. Judge Peter J. Walsh presides over the cases. Martin A. Sosland, Esq., and Ronit J. Berkovich, Esq., at Weil, Gotshal & Manges LLP, serve as bankruptcy counsel to the Debtors. John H. Knight, Esq., at Richards Layton & Finger, P.A., serves as the Debtors' Delaware counsel. The Garden City Group, Inc., as their notice, claims, and solicitation agent. Dallas Stars estimated $100 million to $500 million in assets and debts in its petition. The petitions were signed by Robert L. Hutson, chief financial officer. The team is owned by Dallas businessman Thomas O. Hicks' HSG Sports Group. Mr. Hicks was the former owner of the Texas Rangers. The Texas Rangers were sold in a bankruptcy court- supervised auction to a group led by Hall of Fame pitcher Nolan Ryan for $593 million. The Stars are the second NHL team to file for bankruptcy since 2009, after the Phoenix Coyotes. Counsel to JP Morgan Chase Bank, N.A., as Prepetition First Lien Agent, is Mitchell A. Seider, Esq., and Joseph Fabiani, Esq., at Latham & Watkins LLP. Its Delaware counsel is Michael R. Lastowski, Esq., at Duane Morris LLP. First lien lender Monarch Alternative Capital LLC is represented by Andrew M. Leblanc, Esq., at Milbank Tweed Hadley and McCloy LLP. Counsel to the NHL are Thomas W. Gowan, Esq., and J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP. Counsel to GSP Finance LLC, as successor in interest to Barclays Bank PLC, as Prepetition Second Lien Agent, is Jason Young, Esq., at Clifford Chance US LLP. DECORATOR INDUSTRIES: Won't Seek DIP Loan to Fund Bankruptcy ------------------------------------------------------------ The South Florida Business Journal reports that Decorator Industries filed for Chapter 11 bankruptcy protection on Oct. 3, 2011, in Florida, Miami. The Company intends to continue operating while in bankruptcy. The company declared between $1 million and $10 million in debt, between $10 million and $50 million in assets, and a long list of creditors nationwide. "Our company made significant cost reductions over the last three years to adjust to the declining sales," President and CEO William Johnson said in a news release. "Despite these efforts, management and the board of directors have decided to utilize the Chapter 11 restructuring process to address certain costs in a timely and orderly fashion that could not be dealt with outside of Chapter 11." The company also said it does not intend to seek costly debtor- in-possession financing to fund its bankruptcy. Decorator Industries' sales volume had dropped in recent years, prompting cutbacks. Decorator Industries (Pinksheets: DINI) supplies interior furnishings for the hospitality and RV industries. Decorator Industries, doing business as Specialty Window Coverings and Superior Drapery, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Fla. Case No. 11-37641) on Oct. 3, 2011. Paul J. Battista, Esq. and Mariaelena Gayo-Guitian, Esq., at Genovese Joblove & Battista, P.A., serve as counsel to the Debtor. The Debtor estimated assets of $10 million to $50 million and debts of $1 million to $10 million. DEE ALLEN RANDALL: Says Ponzi Scheme Was "Legal" ------------------------------------------------ Tom Harvey at the Salt Lake Tribune reports that Dee Allen Randall, the owner of Horizon Mortgage & Investment, Horizon Financial & Insurance Group and Horizon Auto Funding, claims he was conducting a "legal Ponzi scheme," but authorities are investigating him for possible violations of the law in an operation that took in $65 million from 700 or so investors, some of whom lost their retirement savings. According to the report, Mr. Randall is suspected by a U.S. bankruptcy official of running a Ponzi scheme in which monies from new investors were used to pay earlier investors to make it appear the businesses were profitable. Mr. Randall said he had promised returns of up to 14% and to safeguard retirement monies with investments in real estate, auto leases or through insurance products. Attorney Steven Bailey in Ogden, Utah, who represents several investors, said Mr. Randall has said in court he took in about $65 million from about 700 investors. Based in Kaysville, Utah, Dee Allen Randall filed for Chapter 11 protection (Bankr. D. Ut. Case No. 10-37546) on Dec. 20, 2010, seeking to forestall creditors while he reorganized his finances. Judge R. Kimball Mosier presides over the case. Andres Diaz, Esq., at 1 on 1 Legal Services, represents the Debtor. The Debtor estimated assets of $10 million and $50 million, and debts of between $1 million and $10 million. Laurie Cayton, of the U.S. Trustee Office, sought appointment of a bankruptcy trustee to take charge of Mr. Randall's financial affairs and conduct an investigation. DUTCH RUN-MAYS: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Dutch Run-Mays Draft, LLC 1280 West Newport Center Drive Deerfield Beach, FL 33442 Bankruptcy Case No.: 11-37471 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: John K. Olson Debtor's Counsel: Chad P Pugatch, Esq. RICE PUGATCH ROBINSON & SCHILLER, P.A. 101 NE 3 Ave Suite 1800 Ft. Lauderdale, FL 33301 Tel: (954) 462-8000 E-mail: cpugatch.ecf@rprslaw.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 five largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flsb11-37471.pdf The petition was signed by William F. Ring, Jr., vice president of Terra Equities, Inc. EAST HARLEM: Meeting of Creditors Scheduled for Oct. 24 ------------------------------------------------------- The U.S. Trustee for Region 2 will convene a meeting of creditors in East Harlem Property Holdings, LP's Chapter 11 case on Oct. 24, 2011, at 2:30 p.m. The hearing will be held at the Office of the U.S. Trustee, 80 Broad Street, Fourth Floor, New York City. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. About East Harlem East Harlem Property Holdings, LP, filed for Chapter 11 relief (Bankr. S.D.N.Y. Case No. 11-14368) on Sept. 15, 2011. Judge James M. Peck presides over the bankruptcy case. Adam P. Wofse, Esq., at Lamonica Herbst & Maniscalco, LLP, in Wantagh, New York, represents the Debtor as counsel. In its petition, the Debtor listed assets of between $100 million and $500 million and debts of between $10 million and $50 million. The petition was signed by Linda Greenfield, vice president of Harlem Housing, LLC, sole and managing member of East Harlem GP, LLC, general partner. ENERGY FUTURE: Change in Executive Officers' Compensation Okayed ---------------------------------------------------------------- The organization and compensation committee of the board of directors of Energy Future Holdings Corp. approved a modification to the Company's executive officers' compensation arrangements. The modification provides that their restricted stock units will be subject to accelerated pro-rated vesting in the event of an applicable executive officer's termination without "cause" or resignation for "good reason," or in the event of the executive officer's death or "disability". About Energy Future Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leveraged buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. The Company's balance sheet at June 30, 2011, showed $45.07 billion in total assets, $52.01 billion in total liabilities and a $6.94 billion total deficit. * * * As reported in the Troubled Company Reporter on Aug. 30, 2011, Fitch Ratings affirmed TCEH's Issuer Default Rating (IDR) at 'CCC'. Due to inter-company linkages, Fitch has also affirmed the IDRs of Energy Future Holdings Corp (EFH), Energy Future Intermediate Holding Company LLC (EFIH) and Energy Future Competitive Holdings Company (EFCH) at 'CCC'. EQK BRIDGEVIEW: Third Amended Plan of Reorganization Confirmed -------------------------------------------------------------- Judge Stacey G. Jernigan of the U.S. Bankruptcy Court for the Northern District of Texas approved EQK Bridgeview Plaza, Inc.'s Third Amended Plan of Reorganization after determining that the explanatory documents contain "adequate information" as defined under Section 1125 of the Bankruptcy Code. The Plan provides for the Debtor to continue to manage and operate the Bridgeview Plaza shopping center located at 2420 Rose Street in La Crosse, Wisconsin, and the approximately 2,928.441 acres of undeveloped land in Kaufman County, Texas, and for the Debtor to either sell the Dunes Plaza shopping center located at 104 Franklin Street in Michigan City, Indiana, pursuant to a pending sale agreement or deed the Dunes Plaza Property to Grand Pacific Finance Corp. Under the Plan, the Debtor will use the Net Operating Income of the Properties, funds currently on hand, funds to be contributed by the Reorganized Debtor's equity holder, and proceeds from sales of the Properties to enable the Debtor to meet operating expense and to pay creditors. Until and unless the Properties are sold or refinanced, or until operating revenues are increased to a sufficient level, Transcontinental Realty Investors, Inc., the entity or its designee acquiring the equity of the Debtor, will need to contribute funds to fund the initial payments to be made under the Plan and to enable the Debtor to meet its obligations under the Plan with respect to the Windmill Farms Property, and TCI has agreed to contribute those funds. The perfected liens and security interests held by the Prepetition Lenders will be continued, preserved and retained to secure the unpaid balance of their respective Allowed Secured Claims. TCI or its designee will receive 100% of the equity interests in the Reorganized Debtor on account of its contributions and the new value it is providing in funding the Plan. A full-text copy of the approved Disclosure Statement is available for free at http://ResearchArchives.com/t/s?76cb About EQK Bridgeview Based in Dallas, Tex., EQK Bridgeview Plaza, Inc., sought chapter 11 protection (Bankr. N.D. Tex. Case No. 10-37054) on Oct. 4, 2010, and is represented by Melissa S. Hayward, Esq. -- MHayward@FSLHlaw.com -- at Franklin Skierski Lovall Hayward LLP in Dallas, Tex. The Debtor owns four parcels of real estate that it values at $74 million. In its schedules, the Debtor disclosed total assets of $76,458,815 and total liabilities of $74,763,048. FILI ENTERPRISES: Court Dismisses Chapter 11 Reorganization Case ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of California dismissed the Chapter 11 case of Fili Enterprises Inc. According to the Troubled Company Reporter on July 21, 2011, upon consummating the 11 U.S.C. Sec. 363 sale of all of its assets in August last year, the Debtor transferred to Wreath Equity LLC all of its property and business operations in exchange for Wreath Equity LLC assuming certain liabilities, contributing certain cash, and allowing the Debtor to retain other cash that was earned during the course of the Debtor's business operations prior to the sale. That left the Debtor with approximately $2.5 million in proceeds, but no assets and no ability to either function any longer as a going concern, or meaningfully reorganize. As part of the sale process, the Debtor negotiated with Wreath Equity and the Official Committee of Unsecured Creditors for an allocation of the Sale proceeds to fully pay all non-professional administrative claims and Committee professional fees; set aside an agreed "carve-out" to distribute to unsecured creditors; and apply the remainder of the cash to pay a portion of the fees and costs owing to the Debtor's professionals. The Debtor currently has $1,950,930 in sale proceeds remaining. To resolve all remaining claims, the Debtor proposes this fund distribution: a. U.S. Trustee Fees of $11,375 will be paid in full. b. The Debtor has reduced the amount of general unsecured claims against the estate from $10.5 million to $4.3 million. Recovery for unsecured creditors is increased from 1.9 cents on the dollar to 4.3 cents. c. The Debtor intends to fully pay all allowed priority tax claims aggregating $25,676. d. The Debtor has reduced the amount of non-professional administrative claims from $1.6 million to $890,000 and intends to fully pay these claims. e. The outstanding amounts currently owed to the Debtor's professionals total $1,344,333. The Debtor intends to pay all fees awarded by the Court to Debtor's professionals on a pari passu basis. The Debtor projects that the Debtor's professionals will be paid 77.2 cents on the dollar. Brendan P. Collins, Esq., at Brownstein Hyatt Farber Schreck LLP, told the Court that following the sale, the Debtor no longer has an operational business, has no employees, has no prospects for rehabilitation, and can't effectuate a plan of reorganization. The U.S. Trustee agreed that dismissal better serves the interests of creditors rather than conversion to Chapter 7. The U.S. Trustee, however, proposed pre-conditions to dismissal. The pre-conditions include that all monthly operating reports of the Debtor should be brought current and all proposed payments to creditors occur prior to the entry of any dismissal order. About Fili Enterprises Fili Enterprises Inc., which owns the Daphne's Greek Cafe, filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court in San Diego, California (Bankr. S.D. Calif. Case No. 10-00324), listing assets and liabilities of between $10 million and $50 million. Fili Enterprises operates 67 Greek restaurants mostly in Southern California. Fili also does business under the names Daphne's Greek Express. Unsecured and priority creditors are owed $3.7 million. U.S. Foodservice Inc., owed $1.1 million, is the unsecured creditor with the largest listed claim. Chief Executive George Katakalidis, a former professional soccer player, founded the company in 1988. FOXCHASE LLLP: Case Summary & 8 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Foxchase, LLLP 237 Day Lake Drive Midland, GA 31820 Bankruptcy Case No.: 11-41057 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Middle District of Georgia (Columbus) Debtor's Counsel: Thomas F. Tierney, Esq. THOMAS F. TIERNEY P.C. 1401 Georgian Park, Suite 110 Peachtree City, GA 30269 Tel: (770) 631-1100 Fax: (770) 631-7055 E-mail: tierneylawyer@yahoo.com Scheduled Assets: $7,776,550 Scheduled Debts: $8,035,857 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/gamb11-41057.pdf The petition was signed by Leonard Bilberry, general partner. FPD LLC: Three Debtors Seek Dismissal of Chapter 11 Cases --------------------------------------------------------- NC Development, LLC, Shadow Brook Farm, LLC, and 7800 Philadelphia Road, LLC, ask the U.S. Bankruptcy Court for the District of Maryland to dismiss their Chapter 11 cases because no asset remains for distribution. The Moving Debtors filed their voluntary bankruptcy petitions on Feb. 25, 2011. On Feb. 25, 2011, the Debtors filed motions for orders (i) approving sale procedures related to the sale of all of the real properties subject to the liens of Wells Fargo Bank, N.A., successor-by-merger to Wachovia Bank, N.A., free and clear of liens, claims and interests; and (ii) approving the sale of the Properties free and clear of liens, claims and interests. The Court granted the Sale Motion on May 26, 2011. Pursuant to the Sale Order, the Moving Debtors proceeded with the process of consummating the sale of their Properties to certain Buyers. As of Aug. 17, 2011, the closing on all of the Moving Debtors' Properties was completed. The net proceeds of the sales of the Moving Debtors' Properties were paid to Wells Fargo. However, the purchase prices of these Properties were insufficient to provide funds for the payment of any of the Moving Debtors' other creditors, Aryeh E. Stein, Esq., at Meridian Law, LLC, in Baltimore, Maryland, relates. The Moving Debtors' assets consisted primarily of its real properties. The only other asset listed on the Schedules filed by any of the Moving Debtors was a checking account held by NC Development, LLC at Bank of Annapolis with a balance of $39. Those funds have been disbursed to pay expenses of the Chapter 11 case and the account has been closed, according to Mr. Stein. The Moving Debtors' Chapter 11 cases were filed in order to permit a well-advertised and promoted auction sale of their Properties, so as to maximize the payment to creditors. The Moving Debtors' attempt to generate funds for payment to creditors other than Wells Fargo was not successful. The Moving Debtors' Properties have been sold and they have no assets with which to formulate and confirm a plan, Mr. Stein says. He notes that Section 112(b) of the Bankruptcy Code provides that the Court may dismiss a Chapter 11 case for "cause." Here, there is no likelihood of rehabilitation, Mr. Stein tells the Court. This is demonstrated by the Moving Debtors' lack of assets and inability to make a distribution to unsecured creditors. Given the circumstances, there can be no question that "cause" for dismissal exists under Section 1112(b). About FPD, LLC Prince Frederick, Maryland-based FPD, LLC, is a land development company formed to acquire and develop property in Calvert County, Maryland. FPD owns a community known as Oaktree Landing in Prince Frederick, Maryland. The Debtor filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case No. 10-30424) on Sept. 3, 2010. G. David Dean, II, Esq., Gary H. Leibowitz, Esq., and Irving Edward Walker, Esq., at Cole Schotz Meisel Forman & Leonard P.A., in Baltimore, assist the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $1 million to $10 million. Alan M. Grochal, Esq., Christopher David Heagy, Esq., Maria Ellena Chavez-Ruark, Esq., and Stephen M. Goldberg, Esq., at Tydings & Rosenberg, LLP, in Baltimore, represent the official committee of unsecured creditors. Affiliates Acorn Land, LLC (Bankr. D. Md. Case No. 10-30437), Breezewood Homes, LLC (Bankr. D. Md. Case No. 10-30441), First Development Group, LLC (Bankr. D. Md. Case No. 10-30443), MD Homes, LLC (Bankr. D. Md. Case No. 10-30444), NC Homes, LLC (Bankr. D. Md. Case No. 10-30445), and Tidewater Land, LLC (Bankr. D. Md. Case No. 10-30446) filed separate Chapter 11 petitions in September 2010. Acorn Land, Breezewood Homes, and MD Homes estimated their assets and debts at $1 million to $10 million each. First Development estimated its assets and debts at $10 million to $50 million. The Debtors' bankruptcy cases are jointly administered. As reported in the TCR on Feb. 9, 2011, the Hon. Paul Mannes of the U.S. Bankruptcy Court for the District of Maryland extended FPD, LLC, et al.'s exclusive periods to file and solicit acceptances for the proposed chapter 11 plan until April 4, 2011, and May 31, respectively. FPD LLC: Court OKs Pact Settling Clearview Property Sale Dispute ---------------------------------------------------------------- The Honorable Paul Mannes approved an agreement among Debtor First Development Group, LLC; Wells Fargo Bank, N.A.; Ian Cohen; DE Assessments, LLC; BankAnnapolis; and First American Title Company to settle the controversy among them arising from that certain Purchase and Sale Contract, dated May 19, 2011, with respect to the sale of certain real properties of the Debtors. By a sale motion, the Debtors asked the Court for authority to sell the real properties owned by them that were subject to liens held by Wells Fargo to secure loans obtained by the Debtors before the Petition Date. One of the properties is a real property known as Clearview Meadow subdivision in Dover, Delaware, consisting of 242 recorded building lots plus common areas, excluding completed townhomes sold to other buyers at the auction. Pursuant to the Court's Mar. 16, 2011 sales procedure order, an auction was held on May 19, 2011, for the Debtors' Maryland and Delaware properties covered by the sale. Mr. Cohen was the successful bidder for the Clearview Property. At the auction, Mr. Cohen and First Development signed the Contract. The Court granted the Sale Motion on May 23, 2011, approving, among other things, the sale of the Clearview Property to Mr. Cohen. Closing of the sale was postponed from June 30, 2011 to July 15, 2011. However, due to a dispute between First Development and Mr. Cohen, Mr. Cohen did not close on the sale, and litigation ensued between the parties. On July 18, 2011, Mr. Cohen filed a complaint for declaratory relief, designated as Adversary Proceeding No. 11-00571, against First Development, DEA, Wells Fargo, BankAnnapolis, and First American, seeking a determination that he was not in default under the Contract and that the Contract entitled him to receive title to the Clearview Property free and clear of a certain Amended Declaration of Restrictions, which, among other things, established certain front foot benefit and capital improvement assessment rights with respect to each lot in the Clearview Property. First Development, DEA, Wells Fargo, BankAnnapolis, and First American asserted that Mr. Cohen in fact was in breach of the Contract for his failure to close, and that the Contract expressly provides that Mr. Cohen agreed to accept title to the Clearview Property subject to the Amended Declaration and the Front Foot Benefits. On July 21, 2011, First Development Group and the other Debtors filed their motion to enforce the order approving the Debtors' sale of Clearview Meadow by directing release of defaulting buyer's earnest money deposit for the benefit of the Debtor, to Wells Fargo, in accordance with the terms of the Contract. By their Motion to Enforce, the Debtors ask the Court to enforce the Contract and to direct First American to pay Mr. Cohen's deposit under the Contract to Wells Fargo, and to award the Debtors' reasonable attorneys' fees incurred in connection with their litigation with Mr. Cohen. The Parties, after extensive negotiations, reached an agreement to settle the controversy among them. The terms and conditions of the Contract are amended and supplemented by certain terms and conditions, including: * In addition to the Purchase Price of $2,247,000, Mr. Cohen will pay the sum of $125,000 at Closing, for a total purchase price of $2,372,000. Sheldon Good & Company's commission for the sale of the Clearview Property will continue to be based on the High Bid Price of $2,100,000; * The Seller will deliver title to the Clearview Property free and clear of liens, claims and encumbrances, as set forth in the Sale Order, provided that Mr. Cohen will take title to the property subject to the Amended Declaration and the Front Foot Benefits; * BankAnnapolis will be paid from the sale proceeds the sum of $150,000; * After deducting from the sale proceeds the required and appropriate Seller closing expense, the net sale proceeds remaining after payment to BankAnnapolis will be paid to Wells Fargo; * Upon completion of Closing, the Debtors' Motion to Enforce will automatically be deemed to be settled and withdrawn without the need for any further action by any of the Parties; * All Parties will execute and deliver to the settlement agent a stipulation of dismissal with prejudice of the Adversary Proceeding. The Parties each will bear their own attorneys' fees and costs; * The Seller and DEA will execute and deliver certain assignments and amendments as may be necessary to confirm that Mr. Cohen will possess all rights of the Seller as the "declarant" with respect to the Clearview Meadow Subdivision. However, the amendments will clearly and expressly provide that Mr. Cohen will not be permitted to amend the Declaration of Restrictions for the Clearview Meadow Subdivision, as amended, or to take any actions that would amend the Declaration or Amended Declaration to transfer, eliminate, or impair the rights of DEA or BankAnnapolis with respect to the Front Foot Benefits for the 61 lots within the subdivision that the Seller sold to purchasers other than Mr. Cohen; * Wells Fargo and BankAnnapolis will deliver the documents necessary to release the lenders' respective liens and security interests on the Clearview Property and the Front Foot Benefits appurtenant thereto, provided that DEA and BankAnnapolis will retain all of their respective rights to the Front Foot Benefits on the 61 Lots; * In lieu of complying with paragraph 44 of the Contract, by Sept. 30, 2011, Mr. Cohen will procure a release of the letter of credit obtained by First Development Group to secure First Development's obligations to the Delaware Department of Transportation to complete certain work on the Clearview Property; otherwise, Mr. Cohen will comply with paragraph 44. First Development relies on e-mails provided by Mr. Cohen, which indicate that Mr. Cohen has an agreement with DelDOT for replacement of the letter of credit for which First Development currently is liable by a bond for which Mr. Cohen and his designee will be liable; and * Each Party releases all of its respective claims and causes of action against each other that relate in any way to the Contract, the Cohen Complaint, and the Debtors' Motion to Enforce. Except as expressly modified by the Stipulation and Order, all terms and conditions of the Sale Order will remain in full force and effect. About FPD, LLC Prince Frederick, Maryland-based FPD, LLC, is a land development company formed to acquire and develop property in Calvert County, Maryland. FPD owns a community known as Oaktree Landing in Prince Frederick, Maryland. The Debtor filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case No. 10-30424) on Sept. 3, 2010. G. David Dean, II, Esq., Gary H. Leibowitz, Esq., and Irving Edward Walker, Esq., at Cole Schotz Meisel Forman & Leonard P.A., in Baltimore, assist the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $1 million to $10 million. Alan M. Grochal, Esq., Christopher David Heagy, Esq., Maria Ellena Chavez-Ruark, Esq., and Stephen M. Goldberg, Esq., at Tydings & Rosenberg, LLP, in Baltimore, represent the official committee of unsecured creditors. Affiliates Acorn Land, LLC (Bankr. D. Md. Case No. 10-30437), Breezewood Homes, LLC (Bankr. D. Md. Case No. 10-30441), First Development Group, LLC (Bankr. D. Md. Case No. 10-30443), MD Homes, LLC (Bankr. D. Md. Case No. 10-30444), NC Homes, LLC (Bankr. D. Md. Case No. 10-30445), and Tidewater Land, LLC (Bankr. D. Md. Case No. 10-30446) filed separate Chapter 11 petitions in September 2010. Acorn Land, Breezewood Homes, and MD Homes estimated their assets and debts at $1 million to $10 million each. First Development estimated its assets and debts at $10 million to $50 million. The Debtors' bankruptcy cases are jointly administered. As reported in the TCR on Feb. 9, 2011, the Hon. Paul Mannes of the U.S. Bankruptcy Court for the District of Maryland extended FPD, LLC, et al.'s exclusive periods to file and solicit acceptances for the proposed chapter 11 plan until April 4, 2011, and May 31, respectively. F.Q. PARTNERS: Case Summary & 10 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: F.Q. Partners, LLC 432 Hwy 72 West, Suite 3 Collierville, TN 38017 Bankruptcy Case No.: 11-30226 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Western District of Tennessee (Memphis) Judge: David S. Kennedy Debtor's Counsel: Michael P. Coury, Esq. BUTLER, SNOW, O'MARA, STEVENS & CANNADA Suite 500, 6075 Poplar Avenue Memphis, TN 38119 Tel: (901) 680-7200 Fax: (901) 680-7201 E-mail: mike.coury@butlersnow.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 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/tnwb11-30226.pdf The petition was signed by Thomas W. Hart, chief manager. FRIENDLY ICE CREAM: Court Approves First Day Motions ---------------------------------------------------- Rachel Feintzeig, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Kevin Gross on Thursday signed off on a variety of first day motions filed by the Friendly?s restaurant chain to continue operations while in bankruptcy, including one request to uphold customer programs like gift cards and discounts. ?I think it?s clear that these customer programs are particularly significant in this case,? Judge Gross said, according to the report. ?We don?t want to disappoint any parents or children.? DBR also relates the Debtors' restructuring lawyer Ross M. Kwasteniet, Esq., told the Bankruptcy Court at Thursday's hearing that Friendly's ?is a company that I think a lot of people have deep connections to.? He also said people would tell him, ?A visit home isn?t complete without a visit to Friendly?s.? DBR also reports that Robert L. LeHane, Esq., at KELLEY DRYE & WARREN 101 Park Avenue New York, NY 10178 Tel: (212) 808-7573 Fax: (212) 808-7897 E-mail: rlehane@kelleydrye.com who?s representing a group of landlords in the case, said he had received a very personal plea -- from his daughter. ?My daughter . . . urged me to make sure that Friendly?s stay open,? he told the Court, adding that his clients, too, would ?certainly like to see a healthy Friendly?s survive this bankruptcy process.? Private equity firm Sun Capital Partners Inc., in Boca Raton, Fla., has created Sundae Group Holdings II LLC to acquire the company out of bankruptcy. ?They?ve chosen a good name,? Judge Gross said, according to the report. ?It is appropriate,? Mr. Kwasteniet concurred. About Friendly's Friendly Ice Cream Corp. -- http://www.friendlys.com/-- the owner and franchiser of 490 full-service, family-oriented restaurants and provider of ice cream products in the Eastern United States, filed for Chapter 11 reorganization together with four affiliates (Bankr. D. Del. Lead Case No. 11-13167) on Oct. 5, 2011, to sell the business mostly in exchange for debt to Sundae Group Holdings II LLC, a unit of Sun Capital Partners Inc. The existing owner and holder of the Debtors' second-lien debt are also affiliates of Sun Capital. Friendly's, based in Wilbraham, Massachusetts, also announced the closing of 63 stores, leaving about 424 operating. Franchise operators have about 230 of the locations. Judge Kevin Gross oversees the case. James A. Stempel, Esq., Ross M. Kwasteniet, Esq., and Jeffrey D. Pawlitz, Esq., at Kirkland & Ellis LLP; and Laura Davis Jones, Esq., Timothy P. Cairns, Esq., and Kathleen P. Makowski, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as the Debtors' bankruptcy counsel. Zolfo Cooper serves as the Debtors' financial advisors. Epiq Bankruptcy Solutions, LLC, serves as the Debtors' claims and notice agent. In its petition, Friendly Ice Cream Corp. estimated $100 million to $500 million in assets and debts. The petitions were signed by Steven C. Sanchioni, executive vice president, chief financial officer, treasurer, and assistant secretary. Sundae Group Holdings proposes to pay about $120 million for the business. The price includes enough cash to pay first-lien debt and an amount of cash for unsecured creditors to be negotiated with the official creditors' committee. Aside from cash, Sun Capital will make a credit bid from the $267.7 million in second- lien, pay-in-kind notes. The bid from Sun Capital is subject to higher and better offers at an auction. Under the proposed time-line, bids would be due Nov. 24, followed by an auction on Dec. 1. A competing bid must be at least $122.6 million in cash. Friendly's is the second company under Sun Capital's portfolio to file for bankruptcy in a span of two days. Mexican-food chain Real Mex, which operates restaurants such as Chevys, filed in Wilmington, Delaware bankruptcy court on Oct. 3, 2011. GALP CNA: Court Dismisses Case of GALP Cypress & Wentwood --------------------------------------------------------- The Hon. Jeff Bohm of the U.S. Bankruptcy Court for the Southern District of Texas, at the behest of U.S. Trustee for Region 18, dismissed the Chapter 11 cases of GALP Cypress Limited Partnership and Wentwood Woodside I LP because the companies are severed from the joint administration case. About GALP CNA Houston, Texas-based GALP CNA Limited Partnership filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Case No. 10- 38975) on Oct. 4, 2010. The Debtor estimated its assets and debts at $1 million to $10 million at the Petition Date. GALP CNA's case is jointly administered with that of Wentwood Woodside I, L.P., Wentwood Roundhill I, L.P., Wentwood Rollingbrook, L.P., and GALP Cypress Limited Partnership. GALP CNA is the lead case. Houston, Texas-based GALP CNA Limited Partnership filed for Chapter 11 bankruptcy protection on Oct. 4, 2010 (Bankr. S.D. Tex. Case No. 10-38975). The Debtor estimated its assets and debts at $1 million to $10 million at the Petition Date. Houston, Texas-based Wentwood Woodside filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Case No. 10-38981) on Oct. 4, 2010. It estimated its assets at $10 million to $50 million and debts at $1 million to $10 million at the Petition Date. Three affiliates -- Wentwood Roundhill, Wentwood Rollingbrook, and GALP Cypress (Case No. 10-38991) -- also filed for Chapter 11 bankruptcy protection on Oct. 4, 2010. Matthew Hoffman, Esq., at the Law Offices of Matthew Hoffman, P.C., assists the Debtors in their restructuring efforts. GENERAL MARITIME: Moves Closer to Formal Restructuring ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that General Maritime Corp. moved closer to a restructuring when it signed a standstill agreement on Sept. 30 with affiliates of Oaktree Capital Management LP, lenders on three credits totaling $1.12 billion. The report relates that the agreement requires delivering an acceptable restructuring proposal. The standstill expires Nov. 10. Moody's Investors Service said in September there is an "increasing prospect" for "a restructuring of the terms of certain of its credit facilities, if not the entirety of its debt." The majority of General Maritime's charter agreements expire in the next 15 months. For the six months ended June 30, New York-based General Maritime reported a $55.5 million net loss on revenue of $208.1 million. The operating loss in the period was $20.2 million. The report relates that the $300 million in 12% senior unsecured notes due in 2017 traded Oct. 4 at 23.3 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The shares closed Oct. 4 at 18.5 cents, down 1.5 cents in New York Stock Exchange composite trading. The three-year closing high was $12.94 in December 2008. About General Maritime Corp. Based in New York City, General Maritime Corporation through its subsidiaries provides international transportation services of seaborne crude oil and petroleum products. The Company's fleet is comprised of VLCC, Suezmax, Aframax, Panamax and product carrier vessels. The Company operates its business in one business segment, which is the transportation of international seaborne crude oil and petroleum products. The Company's vessels are primarily available for charter on a spot voyage or time charter basis. The Company reported a net loss of $216.66 million on $387.16 million of voyage revenue for the year ended Dec. 31, 2010, compared with a net loss of $11.99 million on $350.52 million of voyage revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $1.78 billion in total assets, $1.44 billion in total liabilities, and $339.32 million in total shareholders' equity. Deloitte & Touche LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditor noted that the Company requires additional financing in order to meet its debt obligations that will come due over the next year. In addition, the Company has current losses from operations, a working capital deficit and the expectation that certain of its loan covenants will not be achieved during 2011 without additional capital being raised, debt being refinanced or covenants waived or amended. * * * Standard & Poor's Ratings Services in December 2010 lowered its long-term corporate rating on General Maritime Corp. to 'CCC+' from 'B', and placed the ratings on CreditWatch with negative implications. In the Sept. 6, 2011, edition of the TCR, Moody's Investors Service lowered its probability of default rating of General Maritime to 'Caa3' from 'Caa1' and corporate family rating to 'Caa3' from 'B3'. The outlook is negative. The downgrade of the ratings to Caa3 reflects GenMar's still tightening liquidity notwithstanding the recent issuance of junior debt capital and relaxation of the minimum liquidity covenant of its various debt facilities. Moody's believes that seasonal freight rates will remain close to current levels through most of 2012, because growth in ton-mile demand is unlikely to absorb continuing excess vessel supply. With the majority of the company's current time-charter out contracts expiring in the next 12 to 15 months, GenMar will face increasing exposure to the mainly lower spot market freight rates. Moody's expects the company to continue to have a difficult time achieving positive operating cash flow, which could threaten its ability to make cash interest payments. The resultant overreliance on its cash balance, which stood at almost $59 million at June 30, 2011 to meet its operating and debt service requirements, could cause it to fall out of compliance with the minimum liquidity covenant, which the lenders recently agreed to lower to $35 million through Dec. 31, 2011. GENERAL MARITIME: S&P Cuts Corporate Credit Rating to 'SD' ---------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term corporate rating on New York City-based General Maritime Corp. to 'SD' from 'CCC+'. "At the same time, we lowered our ratings on the company's senior unsecured notes to 'C' from 'CCC-' and placed those ratings on CreditWatch with negative implications. The recovery rating of '6', which indicates our expectation that lenders will receive a negligible (0% to 10%) recovery in a payment default scenario, remains unchanged," S&P related. The rating action on General Maritime follow the Sept. 30, 2011, amendment to the company's credit agreement that allowed it to pay down the revolver sublimit of its 2010 credit facility, in lieu of a scheduled principal amortization on the term loan portion of the facility. "Under our criteria, we view failure to make the scheduled principal payment as a selective default ('SD'), even though the nonpayment was permitted by an amendment to the credit agreement and the payment was applied to the revolving credit portion of the facility," S&P related. General Maritime provides international shipping of crude oil. The company owns a fleet of 31 double-hull vessels, including seven very large crude carriers, 12 Suezmax tankers, nine Aframax, two Panamax, and one Handymax product tankers, with a total carrying capacity of 5.2 million deadweight tons. The company also operates three chartered-in Handymax vessels. The company stated that it is considering various alternatives including seeking additional waivers, offerings of debt or equity, vessel sales, sale of all or a portion of its business, and potentially a reorganization under Chapter 11 of the bankruptcy code. "If General Maritime completes its debt restructuring, we will reassess its credit quality and assign new ratings reflecting our view of the company's operating prospects, capital structure, and liquidity position," S&P related. GENERAL MOTORS: Fitch Upgrades Issuer Default Rating to 'BB' ------------------------------------------------------------ Fitch Ratings has upgraded the Issuer Default Ratings (IDRs) of General Motors Company (GM), General Motors Holdings LLC (GM Holdings) and General Motors Financial Company, Inc. (GMF) to 'BB' from 'BB-'. The Rating Outlook for GM, GM Holdings and GMF is being revised to Positive from Stable. The upgrade of GM's ratings reflects the strengthening of the company's credit profile over the past year as global light- vehicle production volume has grown, net pricing has improved and additional cost efficiencies have taken hold. In addition, with a relatively low debt load and a very strong liquidity position, GM has significant financial flexibility that will help it manage through a potential deterioration in global auto market conditions. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings. It also could use a portion of its liquidity to further shore up the underfunded position of its defined benefit (DB) pension plans. The new labor agreement with the United Auto Workers (UAW) appears largely to have maintained GM's financial and operational flexibility. Despite the continued improvements to the company's credit profile, a number of meaningful risks remain. GM has more work to do on increasing the efficiency of its operations to the level of its strongest global competitors. It will also need to continue making meaningful discretionary cash contributions to its DB pension plans to meet its objective of fully funding the plans. This contribution could be increased as a result of the decline in both interest rates and asset values experienced by the capital markets over the past several months. In addition, broader industry risks have not abated, including the likelihood of rising gasoline prices over time, volatile raw material costs, worldwide manufacturing overcapacity, aggressive competition and tightening global fuel economy and emission regulations. Meeting these challenges will require ongoing significant cash investments in both products and operations. The ratings for GMF are linked to GM, reflecting Fitch's belief that the company is of strategic importance to its parent and that there is an implicit level of support between the entities. GMF was acquired to help improve GM's penetration rates in subprime retail, full-spectrum leasing, and eventually, wholesale financing. Still, GMF's ratings also reflect its solid market position in the auto finance space, seasoned management team, strong asset quality, improved funding flexibility, sound capitalization, and its ability to manage liquidity and economically access the ABS markets throughout the economic downturn. The Positive Outlook for all three entities reflects Fitch's expectation that GM's credit profile will improve gradually over the next several years, provided automotive market conditions do not materially weaken. Fitch anticipates leverage will decline modestly and free cash flow will strengthen, both due to a continuation of the same factors that have contributed to the marked improvement seen over the past two years. Fitch notes, however, that with balance sheet debt likely to decline only slightly over the intermediate term, leverage reduction will be largely dependent upon increased EBITDA. Positive free cash flow will allow the company to maintain a strong automotive cash liquidity position, although the current level is well above the $20 billion that Fitch believes is the minimum needed for GM to operate its business. Given the excess automotive cash on GM's balance sheet, Fitch believes management could make additional, and potentially large, voluntary pension contributions later this year, further reducing the plans' underfunded position. Fitch does not expect the company to return cash to shareholders through common dividends or share buybacks until it has made further progress on funding its pension plans. Fitch could consider a positive action on GM's ratings in the intermediate term if the company makes further progress on reducing its substantial pension obligations, while continuing to update its product portfolio and increase the cost efficiency of its operations. A continued ability to maintain or increase both market share and net pricing in the company's key global markets would also be a factor in a positive rating action. Importantly, Fitch also would look for the company to maintain a cash, cash equivalents, and marketable securities balance of about $20 billion or higher on a sustained basis. On the other hand, Fitch could undertake a negative rating action on GM if external market conditions weaken significantly, resulting in a reduction in free cash flow, a decline in liquidity and an increase in leverage. This situation would require a significant reversal of current market trends. Fitch could also take a negative rating action on the company if management changes its philosophy about keeping debt low and de-risking the company's DB pension plans. While GMF's current Rating Outlook is linked to GM, a de-linking of the financial subsidiary's ratings or Outlook from those of the parent company could occur with a change in the perceived relationship between GM and the subsidiary. This could result in a negative rating action on GMF if Fitch believes that the unit has become less core to the parent's strategic operations or adequate financial support is not provided in a time of crisis. Additionally, the recognition of consistent operating losses, an increase in leverage beyond historical levels, and/or deterioration in the company's liquidity profile could yield negative rating action. Despite the significant positive change seen in GM's credit profile since its bankruptcy filing two years ago, many risks remain. Company-specific risks include significant pension and other post employment benefit (OPEB) obligations, although the latter was reduced heavily in 2009 with the transfer of obligations tied to UAW-represented employees to a union-sponsored voluntary employee benefits association (VEBA). OPEB also is likely to decline once the company and the Canadian Auto Workers Union are able to set up the anticipated Health Care Trust, which will be similar to the VEBA. As of year-end 2010, GM's global pension plans (including certain unfunded non-U.S. plans) were underfunded by $22 billion, including a $12 billion underfunded position for the U.S. plans. During 2010, the company contributed $4.9 billion to its global plans, including $4.1 billion to its U.S. plans. Notably, the figures above do not include a common stock contribution made to the U.S. plans in January 2011 that was valued at $2.2 billion. GM is not required to make any contributions to its U.S. plans in 2011, although management has indicated that the company could potentially make additional contributions to the plans later this year, depending on actual and projected plan performance. This could result in some tension with the equity investors, however, as the company's balance sheet focus appears more oriented to the benefit of fixed income investors, at least in the near term. The underfunded position of the global pension plans could rise significantly at the next measurement date of Dec. 31, 2011, if long-term interest rates stay near current levels and asset values remain depressed. Demonstrating the sensitivity of the plans to interest rates and asset values, Fitch estimates that, for illustrative purposes only, a 30-basis point (bp) decline in interest rates, combined with a 10% decline in asset values (both compared to year-end 2010 levels), would increase the underfunded status of GM's global pension plans by about $13 billion versus year-end 2010. This would result in a global underfunded position, including certain unfunded plans, of $35 billion. Although a reduction in interest rates and asset values of this magnitude would significantly increase the level of cash contributions needed to fully fund the plans, GM's substantial excess cash liquidity position would provide it with the means to offset much of the decline. Fitch emphasizes that the above calculation is only to frame a scenario and is not meant to be an estimate of GM's current funded status. Also considered in Fitch's ratings of GM is the heightened uncertainty as to the strength and pace of the global economic recovery. Although Fitch's base case forecast assumes the U.S. economic recovery continues for the next several years, the rate of improvement is expected to be slower than earlier estimates, as continued high unemployment, ongoing housing weakness, reduced consumer confidence and volatile stock prices are likely to constrain the rate of growth through at least the near term. Conditions in the highly fragmented Western European auto market also are uncertain, as concerns regarding the fiscal stability of the Euro zone countries could weigh heavily on auto demand in the region. Access to customer financing could become an issue in Europe as well, given GM customers' reliance on bank financing, which could become constrained as Euro zone fiscal pressures increase. Developing countries are also seeing a slowing in the pace of demand growth, with, for example, government efforts to curtail the pace of new car sales in China resulting in slower demand growth in a key country. Fitch's 2011 industry forecast calls for full-year U.S. auto sales of 12.5 million, which represents about an 8% increase from the 11.6 million sales seen in 2010. Although the U.S. seasonally adjusted annual rate (SAAR) of sales appears to have hit the 13 million level in September, Fitch believes maintaining that level through the remainder of the year will require heavy marketplace incentives, driven, in part, by Japanese manufacturers making up for market share shortfalls experienced following the earthquake and tsunami earlier this year. This could depress the strong industry net pricing that was seen through the summer of 2011. Assuming the U.S. does not fall back into recession, Fitch expects U.S. sales to continue rising in 2012 and beyond, although sales growth is likely to be milder in those years than earlier expectations due to the current projections for a slower rate of improvement. GM's product portfolio in the U.S. performed relatively well through the first eight months of 2011, with its U.S. light vehicle sales up 16%, leading to a 100 bp increase in market share to 20.1% from 19.1%. GM has seen particular strength in sales of the new Chevrolet Cruze, as well as the Chevrolet Equinox, Cadillac CTS and Buick Regal. In addition, sales of its large pickups, the Chevrolet Silverado and GMC Sierra, generally have held up despite higher fuel prices and significant competition from Ford's new V6-powered F-150 variants. Through August, Silverado sales were up 7.3% and Sierra sales were up 18% year over year. A continued rollout of new models should further strengthen GM's U.S. lineup, with upcoming vehicles such as the compact Chevrolet Sonic, Buick Verano small sedan and redesigned Chevrolet Malibu further updating the company's product offerings. Outside the U.S., GM's unit sales have grown this year despite pressure on industry demand in key markets, such as China and Western Europe. Through the first half of 2011, unit sales in the company's European segment increased 8.7%, despite the ongoing malaise in the region's auto market, supported by several new Opel models, including the redesigned Meriva and Astra. In the South America segment, unit sales were up 20% in the first half of the year (1H'11) on improving economic conditions in much of the region, while the International Operations segment experienced an 8.9% increase in unit sales (including joint venture sales) in 1H'11, driven by growth in developing markets. Overall, GM's global unit sales were up 11% in 1H'11, more than twice the 5.1% increase seen in global industry sales during the same period, further demonstrating the progress the company is making in growing its substantial presence in virtually all major global markets. Strong net pricing and a lower cost base contributed to a Fitch- calculated automotive EBITDA margin of 8.4% in the last 12 months (LTM) ended June 30, 2011, up from only 4.3% in the LTM ended June 30, 2010. Despite the relatively strong EBITDA margin, free cash flow in the LTM ended June 30, 2011 was negative $898 million, largely due to $4 billion of discretionary pension contributions made in late 2010 and the negative working capital impact of 1Q'11 termination of an in-transit financing program with Ally Financial. Absent these non-recurring items, Fitch estimates free cash flow would have been positive in the LTM ended June 30, 2011. Over the intermediate term, Fitch expects margins to rise somewhat from current levels and remain strong by historical standards. However, maintaining sustained margins above 10% could be challenging, given the heavy competition of the global auto market, which continues to be characterized by a focus on market share. For the full year 2011, Fitch expects GM to produce positive free cash flow, excluding any additional significant pension contributions that the company might voluntarily make late in the year. Negatively affecting free cash flow in 2H'11 will be an expected steep rise in capital spending, which the company estimates will total about $7 billion for the full year. After spending only $2.5 billion in 1H'11, GM's forecast suggests 2H'11 capital expenditures could be about $2 billion higher than spending in 1H'11. Also likely contributing free cash flow pressure will be typical seasonal factors, such as plant shutdowns for the model year changeover and higher structural costs to support new model rollouts. Longer term, the company expects to keep capital expenditures near current levels, regardless of changes in market demand. Although this will put additional pressure on free cash flow during times of market weakness, consistent capital spending will help to ensure that the company keeps its product lineup fresh and competitive. GM exited bankruptcy in 2009 with a dramatically reduced debt load, and over the course of 2010, the company reduced its debt by a further $11 billion, ending the year with $4.6 billion of automotive debt. As of June 30, 2011, automotive debt totaled $4.7 billion, and Fitch expects the company's automotive debt to remain in the $4 billion to $5 billion range over at least the intermediate term. The majority of GM's automotive debt is associated with non-U.S. subsidiaries and is non-recourse to the parent company. Late last year, GM withdrew its application for loans from the U.S. Department of Energy's (DOE) Advanced Technology Vehicle Manufacturing (ATVM) program, which at the time had not yet been approved, as management believed borrowing from the program would have been inconsistent with its plans to minimize debt. With GM's very substantial cash liquidity balance, and with management's continued plan to operate the company with minimal debt, Fitch does not expect debt to rise meaningfully for at least the next several years. Fitch calculates that GM ended 2Q'11 with EBITDA leverage (total debt/ Fitch-calculated EBITDA) of 0.4 times (x), the same as at year-end 2010 and down from 1.5x at June 30, 2010. Fixed charge coverage (Fitch-calculated EBITDAR/gross interest expense plus rent) was 9.0x at June 30, 2011, up from 7.3x at year-end 2010 and 2.2x at the end of 2Q'10. The company ended 2Q'11 with a very strong unrestricted automotive cash, cash equivalents and marketable securities balance of $33 billion, up from $27 billion at year-end 2010, and total liquidity, which includes the $5 billion of availability on the company's primary revolving credit facility, increased to $38 billion versus $32 billion. The company also had availability on a number of committed and uncommitted lines of credit outside the U.S. Liquidity in the LTM ended June 30, 2011, was bolstered by GM's sales of its interest in Delphi for $3.8 billion and its preferred stock in Ally Financial for $1 billion earlier this year, as well as its sale of Nexteer for $426 million late last year. On Sept. 28, 2011, the UAW announced that its members had ratified the new four-year labor agreement reached between GM and union leadership 12 days earlier. Fitch has reviewed the terms of the new agreement and the implications on GM's financial performance over the next several years. In general, the new agreement appears to provide the company with sufficient financial and operational flexibility to allow a continuation of the positive progress it has made since emerging from bankruptcy in 2009. Unlike earlier UAW agreements, the new agreement has not increased pension benefits for union-represented employees, and, importantly, it has capped the employee population covered by the DB plans, with new-hire employees covered by a defined contribution (DC) plan instead. Average compensation will decline over time as workers earning entry-level wages make up an increasing proportion of the employee population, and a greater percentage of compensation will be tied the company's financial and quality performance. Although the agreement brings some vehicle production that had been slated for Mexico back to the U.S., it appears overall that it has met management's objective of maintaining the company's breakeven level at a U.S. light-vehicle SAAR of about 10.5 million. GM Holdings' senior secured revolving credit facility is rated 'BBB-', two notches above the subsidiary's IDR of 'BB' to reflect the substantial collateral coverage backing the facility, including most of the company's hard assets in the U.S. GM's Series B preferred stock rating of 'B+' is rated two notches below GM's IDR of 'BB', reflecting its relatively low priority position in a distressed scenario. GM's ratings apply to 100 million shares of 4.75% Series B mandatory convertible junior preferred stock. GM Holdings' ratings apply to a $5 billion secured revolving credit facility. GMF's ratings apply to $500 million of unsecured debt. Fitch has upgraded the following ratings, all with a Positive Outlook: GM -- IDR to 'BB' from 'BB-'; -- Preferred stock rating to 'B+' from 'B-'. GM Holdings -- IDR to 'BB' from 'BB-'; -- Secured revolving credit facility rating to 'BBB-' from 'BB+'. GMF -- IDR to 'BB' from 'BB-'; -- Senior unsecured rating to 'BB' from 'BB-'. GLOBAL CROSSING: Common Shares Delisted from NASDAQ --------------------------------------------------- The NASDAQ Stock Market LLC notified the U.S. Securities and Exchange Commission regarding the removal from listing or registration of Global Crossing Ltd's common stock. About Global Crossing Based in Hamilton, Bermuda, Global Crossing Limited (NASDAQ: GLBC) -- http://www.globalcrossing.com/-- is a global IP, Ethernet, data center and video solutions provider with the world's first integrated global IP-based network. Global Crossing Limited reported a consolidated net loss of $172 million on $2.609 billion of consolidated revenue for the twelve months ended Dec. 31, 2010, compared with a net loss of $141 million on $2.159 billion of revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $2.28 billion in total assets, $2.83 billion in total liabilities and a $548 million total shareholders' deficit. * * * As reported by the Troubled Company Reporter on March 31, 2010, Standard & Poor's Ratings Services raised all its ratings on Global Crossing, including the corporate credit rating to 'B' from 'B-'. The outlook is stable. S&P assigned its 'CCC+' issue-level rating and '6' recovery rating to Global Crossing's proposed $150 million of senior unsecured notes due 2019. The '6' recovery rating indicates S&P's expectation for negligible (0%-10%) recovery in the event of a payment default. GLOBAL CROSSING: Moody's Raises Corporate Family Rating to 'B3' --------------------------------------------------------------- Moody's Investors Service upgraded Level 3 Communications, Inc.'s (Level 3) corporate family and probability of default ratings (CFR and PDR respectively) to B3 from Caa1 on expectations that net synergies from the just-closed acquisition of Global Crossing Ltd. (GCL) will allow the company to become modestly cash flow positive on a sustained basis within two years. In the interim, the company has a large cash position, estimated at $850 million, with which to fund synergy-related initiatives and Level 3's speculative grade liquidity rating remains unchanged at SGL-1 (very good). As part of the action, ratings for the company's debt instruments were adjusted to account for the upgraded CFR/PDR and loss given default (LGD) assessments were revised given debt incurred to refinance CGL's debt (refer to ratings listing below). The actions also include a new $650 million senior secured term loan B at Level 3's wholly-owned subsidiary, Level 3 Financing, Inc. (Financing) and the assumption by Financing of senior unsecured notes originally issued in the name of another wholly-owned subsidiary, Level 3 Escrow, Inc. (Escrow). The rating action concludes a review initiated on April 11, 2011 when the acquisition was announced; the rating outlook is now stable (Ratings for GCL will be withdrawn in due course). These summarizes the rating actions and Level 3's ratings: Issuer: Level 3 Communications, Inc. -- Corporate Family Rating, Upgraded to B3 from Caa1 -- Probability of Default Rating, Upgraded to B3 from Caa1 -- Outlook changed to Stable from on Review for Possible Upgrade -- Senior Unsecured Conv./Exch. Bond/Debenture, upgraded to Caa2 (LGD6, 91%) from Caa3 (LGD6, 90%) -- Senior Unsecured Bond/Debenture, upgraded to Caa2 (LGD6, 91%) from Caa3 (LGD6, 90%) Level 3 Financing -- Senior Secured Bank Credit Facility, upgraded to Ba3 (LGD1, 9%) from B1 (LGD1, 6%) -- Senior Unsecured Regular Bond/Debenture, upgraded to B3 (LGD4, 58%) from Caa1 (LGD4, 54%) Level 3 Escrow (assumed by Level 3 Financing) -- Senior Unsecured Regular Bond/Debenture, upgraded to B3 (LGD4, 58%) from Caa1 (LGD4, 54%) RATINGS RATIONALE Level 3 has a reasonable business proposition but margins are relatively poor because of over-supply and with the interest carry on the company's sizeable debt burden, there has been little capacity to amortize debt. The company's B3 CFR/PDR are based on expectations that net synergies from the just-closed acquisition of Global Crossing Ltd. (GCL) will change this dynamic and allow Level 3 to become modestly cash flow positive on a sustained basis within two years, and that there is sufficient liquidity at closing to fund both investments in synergy-related initiatives and near term debt maturities. The rating also presumes that the company's improving credit profile will facilitate repayment and/or roll-over of 2013 and 2014 debt maturities. Rating Outlook The stable ratings outlook is premised on net synergies from the just-closed acquisition of GCL allowing Level 3 to become modestly cash flow positive on a sustained basis within two years. What Could Change the Rating - Up As the existing B3 CFR/PDR anticipates the benefit of future performance, it is unlikely that the rating would be upgraded over the near term. Once execution risks are substantially addressed and presuming solid industry conditions and solid liquidity arrangements, in the event that Debt/EBITDA declines towards 5.0x and (RCF-CapEx)/Debt advances beyond 5%, positive ratings actions may be warranted. What Could Change the Rating - Down Whether the result of execution mis-steps or adverse industry conditions, should it appear that the company is not cash flow self-sufficient, or in the event of adverse liquidity developments or significant debt-financed acquisition activity, negative ratings activity may be considered. The principal methodology used in rating Level 3 Communications was the Global Communications Infrastructure Rating Methodology, published June 2011. Corporate Profile Headquartered in Broomfield, Colorado, Level 3 Communications, Inc. (Level 3) is a publicly traded international communications company with one of the world's largest communications and Internet backbones. GRACEWAY PHARMACEUTICALS: S&P Revises Corp. Credit Rating to 'D' ---------------------------------------------------------------- Standard & Poor's Ratings Services changed its corporate credit rating on Bristol, Tenn.-based Graceway Pharmaceuticals LLC to 'D' from 'SD' following the company's filing for Chapter 11 bankruptcy protection on Sept. 29, 2011. "At the same time, we lowered the issue-level rating on the company's first-lien secured debt to 'D' from 'CC' and removed it from CreditWatch developing, where it was placed on Sept. 17, 2010. The 'D' issue-level rating on Graceway's second-lien debt, and the existing recovery ratings, remain unchanged," S&P said. "The first-lien recovery rating is '4', indicating our expectation of average (30%-50%) recovery in the event of payment default. The second lien recovery rating is '6' indicating our expectation of negligible (0-10%) recovery in the event of payment default. The issue-level rating on both the first-lien and second-lien debt is 'D' (the same as the corporate credit rating)," S&P related. "Standard & Poor's view of the lender's recovery has not changed following the bankruptcy announcement," said Standard & Poor's credit analyst Michael Berrian. GREAT ATLANTIC: Evicts Grocery Haulers From Avenel Warehouse ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Great Atlantic & Pacific Tea Co. won the first round in its effort at evicting Grocery Haulers Inc. from a warehouse in Avenel, New Jersey. Grocery Haulers provided trucking services for A&P's Pathmark brand stores. As part of the arrangement, Grocery Haulers rented the Avenel warehouse for $1 a year. The report recounts that early in the Chapter 11 case A&P rejected the contract with Grocery Haulers. When Grocery Haulers refused to vacate the warehouse, A&P sued, seeking a declaration that there was a violation of the so-called automatic stay in bankruptcy. Grocery Haulers responded by arguing that rejection of a lease doesn't oust a tenant from the right to occupy the premises for the remainder of the term of the lease. According to the report, U.S. Bankruptcy Judge Robert D. Drain didn't buy Grocery Haulers' argument. In an Oct. 3 ruling, Judge Drain said it wasn't a "true lease." He directed Grocery Haulers to "vacate the premises as promptly as practicable." Judge Drain said he would hold a hearing later to decide if damages should be imposed for violation of the automatic stay. A&P said it intends to lease or monetize the value of the warehouse once Grocery Haulers is gone. About Great Atlantic & Pacific Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific is a supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid-Atlantic and Northeastern United States. Before filing for bankruptcy in 2010, A&P operated 429 stores in 8 states and the District of Columbia under the following trade names: A&P, Waldbaum's, Pathmark, Pathmark Sav-a-Center, Best Cellars, The Food Emporium, Super Foodmart, Super Fresh and Food Basics. A&P had 41,000 employees prior to the bankruptcy filing. A&P and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010 in White Plains, New York. In its petition, A&P reported total assets of $2.5 billion and liabilities of $3.2 billion as of Sept. 11, 2010. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represent the Official Committee of Unsecured Creditors. A&P obtained court approval for a new contract with C&S Wholesale Grocers Inc., its principal supplier. The contract is designed to save A&P $50 million a year when the supermarket operator emerges from Chapter 11 reorganization. A&P sold postpetition 12 Super-Fresh stores in the Baltimore- Washington area for $37.83 million, plus the value of inventory. Thirteen other locations didn't attract buyers at auction and were closed mid-July 2011. GSC GROUP: Trustee Files Amended Ch. 11 Plan After $235MM Sale -------------------------------------------------------------- Sindhu Sundar at Bankruptcy Law360 reports that the trustee for GSC Group Inc. on Tuesday filed an amended Chapter 11 plan calling for all GSC equity interests to be canceled, and for the company to reorganize as part of its $235 million sale to Black Diamond Capital Management LLC. U.S. Bankruptcy Judge Arthur Gonzalez had approved the sale of the company's assets in July to Black Diamond, to whom it had owed $209 million when it filed for Chapter 11 protection in August 2010, according to Law360. 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. Since Jan. 7, 2011, the Debtors have been operated by James L. Garrity Jr., as Chapter 11 trustee for the Debtors. No committee of unsecured creditors has been appointed in the Chapter 11 Cases. GSI HOLDINGS: Moody's Says B2 CFR Unaffected by Acquisition ----------------------------------------------------------- Moody's Investors Service said that the announcement that AGCO (rated Ba1 by Moody's) has agreed to acquire GSI Holdings Corp., (the entity that wholly owns GSI Holdings, LLC) from affiliates of Centerbridge Partners, L.P. does not affect GSI Holdings, LLC ("GSI")'s B2 corporate family rating, B2 probability of default rating, or existing debt instrument ratings. The ratings outlook remains stable. The transaction is expected to close before the end of 2011, subject to regulatory approval. GSI's debt is expected to be repaid upon closing of the acquisition. Upon consummation of the acquisition and full repayment of rated debt, Moody's expects to withdraw all of GSI's ratings. These summarizes the current ratings: Corporate family rating at B2; Probability of default rating at B2. $50 million first lien revolver due 2013 at B1 (LGD-3, 36%) $305 million first lien term loan due 2014 at B1 (LGD-3, 36%) The principal methodology used in rating GSI Holdings, LLC was the Global Heavy Manufacturing Rating Industry Methodology, published in November 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. GSI Holdings Corp. headquartered in Assumption, IL, is a manufacturer and supplier of agricultural equipment. Roughly 70% of GSI's revenues are to the North American market. The company's products include grain storage systems, and swine and poultry production equipment. Revenues during the last twelve months ended June 30, 2011 totaled over $700 million. HOFMEISTER'S PERSONAL: Intends to Sell Inventory in November ------------------------------------------------------------ Scott Olson at the Indianapolis Business Journal reports that Hofmeister's Personal Jewelers Inc. plans to begin an aggressive sale of its inventory next month in an attempt to pay down debt and move a step closer to emerging from bankruptcy protection. The report relates the Company said it isn't liquidating the store and plans to stay in business, but is asking the court to let it use "bankruptcy," "Chapter 11," "reorganization" and "inventory reduction" wording in its advertisements to help spur sales. According to the report, the store at 3809 E. 82nd St. said in a court filing that, pending court approval, the sale will begin on Nov. 2, 2012, and continue until Feb. 14, 2012. The intent is to sell as much merchandise as possible during the Christmas shopping season and through Valentine's Day. The report says Hofmeister's wants to hire Pittsburgh-based LFS Consultants to help it move merchandise and plans to pay it a sales commission of 4.5%, according to court documents. The commission will decline to 2.5% on jewelry items priced at $20,000 and above. The report relates that Hofmeister's is asking the court to authorize the sale without obtaining various state and local licenses and without observing state and local waiting periods. Hofmeister's Personal Jewelers Inc., operates jewelry stores under the Hofmeister's Keepsake Diamond Center name. It was founded by Gary Hofmeister in 1973 in downtown Indianapolis. Mr. Gary's son, Carter, owns 85% of the business and manages operations. Hofmeister's filed for Chapter 11 bankruptcy protection (Bankr. S.D. Ind. Case No. 11-04451) on April 13, 2011. Judge Basil H. Lorch, III, presides over the case. Eric C. Redman, Esq., at Redman Ludwig PC, represents the Debtor. The Debtor disclosed $3,799,696 in assets, and $5,483,014 in debts. HORIZON LINES: Exchange Offer Expires; 99.3% of Notes Tendered -------------------------------------------------------------- Horizon Lines, Inc.'s previously announced exchange offer and consent solicitation expired on Oct. 3, 2011, at 5:00 p.m., New York City time. As of the expiration of the exchange offer, 99.3% of the $330.0 million aggregate principal amount of the 4.25% Convertible Senior Notes due 2012 had been tendered into the exchange offer and consent solicitation. As part of the exchange offer, the Company has also secured consents from participating holders of the 2012 convertible notes to remove substantially all of the restrictive covenants and certain events of default from the indenture governing the 2012 convertible notes. The Securities and Exchange Commission has also declared the Registration Statement on Form S-4, as amended, effective. The Company intends to complete the exchange offer as soon as possible, but in no event later than Oct. 6, 2011, at which time it expects to close the entire refinancing. About Horizon Lines Charlotte, N.C.-based Horizon Lines, Inc. (NYSE: HRZ) is the nation's leading domestic ocean shipping and integrated logistics company. The Company owns or leases a fleet of 20 U.S.-flag containerships and operates five port terminals linking the continental United States with Alaska, Hawaii, Guam, Micronesia and Puerto Rico. The Company provides express trans-Pacific service between the U.S. West Coast and the ports of Ningbo and Shanghai in China, manages a domestic and overseas service partner network and provides integrated, reliable and cost competitive logistics solutions. The Company's balance sheet at June 26, 2011, showed $794.96 million in total assets, $793.45 million in total liabilities, and a stockholders' deficit of $1.51 million. The Company expects to experience a covenant breach under the Senior Credit Facility in connection with the amended financial covenants upon the close of the third fiscal quarter of 2011. As reported in the TCR on March 30, 2011, Ernst & Young LLP, in Charlotte, North Carolina, expressed substantial doubt Horizon Lines' ability to continue as a going concern, following the Company's results for the fiscal year ended Dec. 26, 2010. The independent auditors noted that there is uncertainty that Horizon Lines 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 by the TCR on Aug. 26, 2011, Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Horizon Lines Inc. to 'SD' from 'CCC'. The rating action on Horizon Lines follow the company's decision to defer the interest payment on its $330 million senior convertible notes due August 2012, exercising the 30-day grace period. "Under our criteria, we view failure to make an interest payment within five business days after the due date for payment a default, regardless of the length of the grace period contained in an indenture," said Standard & Poor's credit analyst Funmi Afonja. HRAF HOLDINGS: U.S. Trustee Wants Case Dismissed or Converted ------------------------------------------------------------- The U.S. Trustee for Region 19 asks the U.S. Bankruptcy Court for the District of Utah to dismiss the Chapter 11 case of HRAF Holdings LLC and Harbor Real Asset and Fund LP or, in the alternative, convert the Debtors' case to Chapter 7 proceedings. About HRAF Holdings, LLC Midvale, Utah-based HRAF Holdings, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Utah Case No. 10-32433) on Sept. 9, 2010. HRAF disclosed $18,423,000 in assets and $10,989,436 in liabilities as of the Chapter 11 filing. Affiliate Harbor Real Asset Fund L.P. filed for Chapter 11 bankruptcy protection (Bankr. D. Utah Case No. 10-32436) on Sept. 9, 2010. The two cases are consolidated and jointly administered under the case of HRAF. George B. Hofmann, Esq., at Parsons Kinghorn & Harris, assists the Debtors in their restructuring efforts. The Debtors estimated their assets and debts at $10 million to $50 million. HRAF HOLDINGS: Bank Paid in Full From Liquidation of Property ------------------------------------------------------------- HRAF Holdings, LLC, and Harbor Real Asset Fund, LP, filed on Sept. 26, 2011, a First Amended Plan of Reorganization that contemplates the continuation of business operations and the revesting of all of the separate assets of the Debtors' estates to the Reorganized Debtor as of the Effective Date. Pursuant to the Plan, filed Sept. 26, 2011, the Reorganized Debtor will conduct an orderly liquidation of the remaining property of the consolidated estate. The Reorganized Debtor will use its best efforts to sell as much of the Real Property and Water Stock and other assets of the estate, if any, as is necessary to satisfy the Allowed Claims of Loan Acquisitions Group, LLC, which is the successor-in-interest to Bank of America, N.A. (the ?Bank?), and to satisfy the Allowed Claims of other creditors. The Plan designates 27 Classes of Claims and Interest, all of which are impaired and entitled to vote to accept or reject the Plan: Class 1 - Priority Claims (HRAF). Class 2 ? General Unsecured Claims (HRAF). Class 3 ? Secured Tax Claim of Boise County. Class 4 ? Secured Tax Claim of Columbia County Tax Collector. Class 5 ? Secured Tax Claim of Honolulu County. Class 6 ? Secured Tax Claim of Iron County. Class 7 ? Secured Tax Claim of Salt Lake County Treasurer. Class 8 ? Secured Tax Claim of Summit County. Class 9 ? Secured Tax Claim of Taney County Collector. Class 10 ? Secured Tax Claim of Uintah County. Class 11 ? Secured Tax Claim of Wasatch County Corporation. Class 12 ? Secured Tax Claim of Washington County. Class 14 ? Secured Claim of Creek Road Owners Association (HRAF). Class 15 ? Secured Claim of Jordanelle Special Services District (HRAF). Class 16 ? Secured Claim of The Promontory Conservancy (HRAF). Class 17 ? Secured Claim of Reynolds Brothers Construction (HRAF). Class 18 ? Miscellaneous Secured Claims (HRAF). Class 19 ? Secured Claim of the Bank (Harbor). Class 20 ? Secured Claim of Kenneth and Richelle Patey (Harbor). Class 21 ? Miscellaneous Secured Claims (Harbor). Class 22 ? Priority Claims (Harbor). Class 23 - General Unsecured Claims (Harbor). Class 24 ? Equity Interests in Harbor. Class 25 ? Equity Interest in HRAF. Class 26 ? Participation Interests. Class 27 ? Subordinated Claims. The holders of Class 2 Allowed General Unsecured Claims as against HRAF will be paid the full amount of their claim as of the Petition Date, but will not be paid post-petition interest on their Claims. The holders of Class 23 Allowed General Unsecured Claims as against Harbor will be paid the full amount of their claim as of the Petition Date to the extent the Reorganized Debtor has sufficient cash remaining after distributions to the holders of Secured Claims and Priority Claims. The holders of Allowed Class 23 Claims will not be paid post-petition interest on their Claims. The Class 19 Bank Claim is allowed in the amount of $10,673,388.43 as of the Petition Date, plus interest from the Petition Date through the Effective Date at the rate of 8% per annum, plus the Bank's reasonable attorneys' fees and costs incurred from Sept. 9, 2010, to the Effective Date, less any preconfirmation payments paid by the Debtors to or for the benefit of the Bank (the ?Bank's Claim?). The Bank's Claim will bear interest from and after the Effective Date at the rate of 7% per annum. The holders of Allowed Class 19 Claims will retain their liens until their claims are paid in full. The Bank also holds an Allowed General Unsecured Claim as against HRAF in the amount of $10,673,388.43. The Bank's Allowed Class 2 Claim arises pursuant to a written guaranty executed by HRAF in favor of the Bank. The Bank's Class 19 Claim will be paid in full by the Debtor on or before the Final Distribution Date (defined in the Plan as the earlier of (a) 180 days after the Debtors have completed the liquidation of all Real Property and other assets, or (b) Sept. 9, 2015). Payments by the Reorganized Debtor of the Bank's Allowed Class 2 Claim (General Unsecured Claim against HRAF) will constitute a dollar-for-dollar credit against and reduce the Reorganized Debtor's obligation to pay the Bank's Allowed Class 19 Claim (Secured Claim against Harbor). The Class 19 Claim will be paid in full, with accrued interest, not later than the Final Distribution Date. Subject to the payments, priorities and reserves established under sections 6.1.3 and 6.1.4 of the Plan, the Debtors may make payments of available cash to the Bank or its successor-in-interest from time-to-time, but in any event at least on the Initial Distribution Date and the subsequent Interim Distribution Dates, to the extent that a full or partial distribution of cash is available on such dates, through any combination of (a) sale, liquidation or distribution of the Debtors' assets, (b) collection of the Debtors' accounts receivable, (c) collection of rents payable to the Debtors, (d) financing or refinancing of the Real Property on a first-priority lien basis, (e) the incurrence of debt by HRAF and/or Harbor on a secured or unsecured basis, or (f) raising additional equity capital by Harbor or HRAF, subject to the Bank's liens in any asset of the Debtors, or the Bank's whole or partial release of such liens. The holders of Allowed Class 24 Interests in Harbor will retain their interests in Harbor, or its successor in interest, as a Reorganized Debtor. Until the payment in full of the Class 19 Claim of the Bank, each record holder of an Allowed Class 25 Equity Interest in HRAF will retain its interest in HRAF, or its successor in interest, as a Reorganized Debtor. After the payment in full of the holders of all Allowed Claims against HRAF (and after all amounts specified in sections 6.1.3.1 through 6.1.3.11 of the Plan, have been paid, reserved or set aside), any and all remaining cash will be distributed to the holders of Class 25 Interests according to their respective equity ownership interests. The Bank holds a Lien upon, among other things, the Class 25 Interests and upon Harbor's right, as the holder of such interests, to receive member distributions. Except as otherwise agreed by the Bank in writing, all distributions to the holders of Class 25 Interests will be paid directly to the Bank until the Bank's Class 19 Secured Claim has been paid in full. A copy of the First Amended Plan is available for free at: http://bankrupt.com/misc/hraf.firstamendedplan.pdf About HRAF Holdings, LLC Midvale, Utah-based HRAF Holdings, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Utah Case No. 10-32433) on Sept. 9, 2010. HRAF disclosed $18,423,000 in assets and $10,989,436 in liabilities as of the Chapter 11 filing. Michael R. Johnson, Esq., at Ray Quinney & Nebeker P.C., in Salt Lake City, represents HRAF Holdings, LLC. Affiliate Harbor Real Asset Fund L.P. filed for Chapter 11 bankruptcy protection (Bankr. D. Utah Case No. 10-32436) on Sept. 9, 2010. George Hofmann, Esq., Matthew M. Boley, Esq., and Steven C. Strong, Esq., at Parsons Kinghorn Harris, in Salt Lake City, represents Harbor Real Asset Fund, LP. The two cases are consolidated and jointly administered under the case of HRAF. The U.S. Trustee for Region 19 asks the U.S. Bankruptcy Court for the District of Utah to dismiss the Chapter 11 case of HRAF Holdings LLC and Harbor Real Asset and Fund LP or, in the alternative, convert the Debtors' case to Chapter 7 proceedings. IMR CONTRACTOR: Bankruptcy Case Delays Campus Projects ------------------------------------------------------ Vanessa Rancano at Laney Tower reports that construction on the Laney College campus has reached a standstill after the original contractor, IMR Contractor Corporation, filed for Chapter 11 bankruptcy. The report says the bankruptcy is likely connected to a longstanding anti-discrimination lawsuit against the company. According to the report, a new contractor has been assigned to the stagnating project, and work is set to resume, but students can expect another three to four months of disruption. The stalled work consists of the Barrier Removal Implementation Project (BRIP) and a series of Americans with Disabilities Act (ADA) compliance renovations. This $2.3 million overhaul of Laney facilities is funded by Measure A, a $390 million bond measure passed by Alameda County, California, voters in 2006. The project includes renovations to the theater, library, and women's locker room restrooms, among other sites; and the construction of two new elevators and an inclined lift. Ms. Rancano says the issue came to Peralta officials' attention when they received "stop notices" from subcontractors under IMR who had not been paid. Officials questioned IMR, and both the bankruptcy and a related lawsuit surfaced, according to Project Facilities Manager for the BRIP Jeffrey Cook. Based in Haryward, California, IMR Contractor Corporation filed for Chapter 11 protection (Bank. N.D. Calif. Case No. 11-45500) on May 20, 2011. Judge William J. Lafferty presides over the case. Chris D. Kuhner, Esq., at Kornfield, Nyberg, Bendes and Kuhner, represents the Debtor. The Debtor estimated both assets and debts between $1 million and $10 million. INNER CITY MEDIA: Meeting of Creditors Set for Oct. 25 ------------------------------------------------------ On Sept. 8, 2011, the U.S. Bankruptcy Court for the Southern District of New York entered orders for relief commending Chapter 11 proceedings for Inner City Media Corporation and its debtor- affiliates. The meeting of creditors is set for Oct. 25, 2011, at 2:00 p.m., prevailing Eastern Time, at the Office of the U.S. Trustee, located at 80 Broad Street, 4th Floor, New York. During the meeting, a representative of the Debtors will appear for the purpose of being examined under oath. Creditors are welcome to attend. The meeting may be continued and concluded at a later date without further notice. Creditors may file proofs of claim in these Chapter 11 cases. The Court has not yet set a deadline for the filing of proofs of claim. Separate notice of the deadlines to file as well as the forms and instructions regarding proofs of claim will be provided to the Debtors' known creditors. A secured creditor retains rights in its collateral regardless of whether it files a proof of claim. Proof of claim forms are available from the Court's website at http://www.nysb.uscourts.govor from the Debtors' claims agent in these cases, GCG, Inc. at: ICB Case Administration c/o GCG, Inc. P.O. Box 9809 Dublin, Ohio 43017-5709 Confirmation of a Chapter 11 plan may result in a discharge of debts, which may include all or a part of a debt. A discharge means that a creditor may never try to collect the debt from the Debtors, except as provided in the plan. If a creditor believes that a debt owed to it is not dischargeable under Section 1141(d)(6)(A) of the Bankruptcy Code, it must start a lawsuit by filing a complaint in the bankruptcy clerk's office. The deadline to file a complaint to determine dischargeability of certain debts has not yet been yet. Akin Gump Strauss Hauver & Feld LLP represents the Debtors. Ira S. Dizengoff, Esq. Shaya Rochester, Esq. AKIN GUMP STRAUSS HAUER & FELD LLP One Bryant Park New York, New York 10036 Tel: (212) 872-1000 Fax: (212) 872-1002 - and - Scott L. Alberino, Esq. AKIN GUMP STRAUSS HAUER & FELD LLP Robert S. Strauss Building 1333 New Hampshire Avenue, N.W. Washington, DC 20036-1564 Tel: (202) 887-4000 Fax: (202) 887-4288 About Inner City In August 2011, affiliates of Yucaipa and CF ICBC LLC, Fortress Credit Funding I L.P., and Drawbridge Special Opportunities Fund Ltd., signed involuntary Chapter 11 petitions for Inner City and its affiliates (Bankr. S.D.N.Y. Case Nos. 11-13967 to 11-13979) to collect on a $254 million debt. The Petitioning Creditors are party to the senior secured credit facility pursuant to which they (or their predecessors in interest) extended $197 million in loans to the Alleged Debtors to be used for general corporate purposes. More than two years ago, the Alleged Debtors defaulted under the Senior Secured Credit Facility, and in any event the entire amount of principal and accrued and unpaid interest and fees became immediately due and payable on February 13, 2010. As a result, the Senior Lenders are owed approximately $250 million in principal and accrued and unpaid interest and fees as of the Involuntary Chapter 11 Petition Date. Inner City Media Corporation's affiliates subject to the involuntary Chapter 11 are ICBC Broadcast Holdings, Inc., Inner- City Broadcasting Corporation of Berkeley, ICBC Broadcast Holdings-CA, Inc., ICBC-NY, L.L.C., ICBC Broadcast Holdings-NY, Inc., Urban Radio, L.L.C., Urban Radio I, L.L.C., Urban Radio II, L.L.C., Urban Radio III, L.L.C., Urban Radio IV, L.L.C., Urban Radio of Mississippi, L.L.C., and Urban Radio of South Carolina, L.L.C. Judge Shelley C. Chapman granted each of Inner City Media Corporation and its debtor affiliates relief under Chapter 11 of the United States Code. The decision came after considering the involuntary petitions, and the Debtors' answer to involuntary petitions and consent to entry of order for relief and reservation of rights. J.C. EVANS: Can Hire Tittle Advisory Group as Financial Advisors ---------------------------------------------------------------- JCE Delaware, Inc. and its five debtor affiliates sought and obtained the approval of the Honorable Craig A. Gargotta to employ Tittle Advisory Group, Inc., to provide financial advisory services with regard to debtor-in-possession financing arrangements. Specifically, Tittle Advisory Group will: * advise the Debtors in obtaining DIP financing; * solicit DIP financing on behalf of the Debtors; and * evaluate DIP financing offers. Tittle Advisory Group will be paid on an hourly basis up to a maximum fee of $10,000, and reimbursed for reasonable expenses. The Firm will also receive a $10,000 retainer to secure its employment. The current hourly rates of the professionals tasked to perform the services are: John Tittle, Jr. $350 Other professionals $150 - $250 The Debtors believe that Tittle Advisory Group has no adverse or otherwise a conflict of interest or connection with the Debtors that would disqualify it from providing services for the Debtors in these cases. Tittle Advisory Group is a disinterested person as the term is defined in Section 101(14) of the Bankruptcy Code. About J.C. Evans Construction With roots stretching back over 55 years, J.C. Evans is a heavy equipment construction company based in Leander, Texas. Through J.C. Evans Construction Co., L.P., a Texas limited partnership d/b/a/ American Aggregates, the Company owns and operates a construction company specializing in heavy site preparation on commercial, pipeline, utility and highway projects, including excavating, trenching, site preparation and construction. Through Adkins Land Development, L.P., a Texas limited partnership, the Company owns a 700-acre quarry, which produces aggregate for use in road construction. J.C. Evans Construction Holdings is the holding company that owns directly or indirectly each of the other entities. In turn, Holdings is owned by a trust for the benefit of the current and former employees of J.C. Evans through an Employee Stock Ownership Plan. Six affiliated companies filed for Chapter 11 (Bankr. W.D. Tex. Case Nos. 11-11926 to 11-11931) on Aug. 1, 2011. These are JCE Delaware Inc., J.C. Evans Construction Holdings, J.C. Evans Nevada, LLC, EQUUS Development Inc., J.C. Evans Construction and Adkins Land Development. The cases are jointly administered before Judge Craig A. Gargotta. George H. Tarpley, Esq., and Mark E. Andrews, Esq., at Cox Smith Matthews Incorporated, serve as bankruptcy counsel. KILEY RANCH: Asks Court to Dismiss Chapter 11 Case -------------------------------------------------- Kiley Ranch Communities asks the U.S. Bankruptcy Court for the District of Nevada to dismiss its Chapter 11 case because it does not have any remaining real and personal property assets after BB&T conducts its trustee's foreclosure sale and any related default sales. The Debtor laments that it will continue to incur administrative fees and costs associated with its Chapter 11 proceeding if it remains in a Chapter 11 proceeding. The Debtor says the dismissal is in the best interest of its estate and creditors. Kiley Ranch Communities is a "live-work community" in progress in the Spanish Springs Valley of Sparks. Reno, Nevada-based Kiley Ranch Communities filed for Chapter 11 protection (Bankr. D. Nev. Case No. 10-53393) on Aug. 26, 2010. Stephen R. Harris, Esq., at Belding, Harris & Petroni, Ltd, assists the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $50 million to $100 million. KINGSBURY CORP: Files for Bankruptcy After Reaching Financing Deal ------------------------------------------------------------------ Jeff Feingold at New Hampshire Business Review reports that Kingsbury Corp. filed for Chapter 11 bankruptcy protection on Sept. 30, 2011, after reaching agreement with Diamond Business Credit LLC for new financing that the company said will provide "needed and continued working capital" that will be key in allowing the company to continue operations as it reorganizes. "Chapter 11 will provide Kingsbury an opportunity to restructure for the benefit of our valued customers and vendors, and, most important, our valued employees," the report quotes Iris Mitropoulis, president of Kingsbury, as saying. Mr. Feingold says Kingsbury was hard-hit by the collapse of the U.S. auto industry in 2009, when it was hurt not only by declining orders but cancellations as well. By March 2009, Kingsbury said it was forced to furlough many of its employees and to freeze payments to vendors. Kingsbury's major lenders showed temporary patience, but by early 2011, Kingsbury faced increasing pressure, particularly from its major equipment lender, Utica Leaseco, LLC. The report says, faced with Utica's potential repossession and auction of equipment necessary for Kingsbury's continued operation, Kingsbury and its affiliates, two holding companies, filed for Chapter 11 relief. Kingsbury Corp. -- http://www.kingsburycorp.com-- makes and assembles machine systems. Kingsbury Corporation and affiliate Ventura Industries, LLC, filed Chapter 11 petition (Bankr. D. N.H. Case Nos. 11-13671 and 11- 13687) on Sept. 30, 2011. Jennifer Rood, Esq., and Robert J. Keach, Esq., at Berstein, Shur, Sawyer & Nelson, server as counsel to the Debtors. Kingsbury estimated assets and debts of up to $50 million in its Chapter 11 petition. KT SPEARS: Can Access RBC Cash; Excess Funds to be Paid to RBC -------------------------------------------------------------- The U.S. Bankruptcy Court for the District South Carolina has authorized KT Spears Creek, LLC, to use cash collateral of RBC Bank to pay expenses, so long as all disbursements by the Debtor will be made in strict compliance with the terms of the order and the budget. Any and all surplus funds, after paying expenses will be paid to RBC Bank as adequate protection payments. No funds will be paid to Kyle Tauch, the principal of the Debtor or any affiliate of the Debtor or Kyle Tauch without further order of the Court. RBC Bank, owed $23,092,333 according to RBC Bank's Amended Proof of Claim, has agreed to pay the taxes and insurance as it relates to the property located in Richland County, South Carolina, including the Greenhill Parrish Apartments, from the proceeds from the budget and any funds RBC Bank has accepted from the Debtor. RBC Bank will have a continuing replacement lien in the same priority and extent as existed pre-petition. As reported in the TCR on Sept. 7, 2011, RBC Bank asserts that it has a perfected first priority pre-petition security interest in the Debtor's rents derived from the Apartment Complex. About KT Spears KT Spears Creek, LLC, in Houston, Texas, is a South Carolina limited liability company that owns three parcels of property. The Debtor has already developed Phase 1 of of a planned two-phase apartment community. The other two parcels are in the planning/marketing stages of development. The Company filed for Chapter 11 bankruptcy (Bankr. S.D. Tex. Case No. 11-33991) on May 3, 2011, Judge Letitia Z. Paul presiding. The Debtor estimated $10 million to $50 million in both assets and debts. The petition was signed by Kyle D. Tauch, sole member. The Hon. Letitia Z. Paul transferred the Debtor's Chapter 11 case to the Bankruptcy Court for the District of South Carolina. The Case No. is 11-04241. The case was assigned to Chief Judge John E. Waites. G. William McCarthy, Jr., Esq., Daniel J. Reynolds, Jr., Esq., and Sean P. Markham, Esq., at McCarthy Law Firm, LLC, in Columbia, S.C., represent the Debtor as counsel. LEED CORP: Court Approves Maynes Taggart as Bankruptcy Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Idaho authorized Leed Corporation to employ Robert J. Maynes and Steven L. Taggart of Maynes Taggart PLLC as counsel. According to the Troubled Company Reporter on Aug. 22, 2011, the Debtor related that the Court has approved the employment of Mr. Maynes as its counsel, however, Mr. Maynes, and Mr. Taggart, formed the firm of Maynes Taggart PLLC. Given the size and complexity of Debtor's case, the Debtor desires to engage the services of both Messrs. Maynes and Taggart of Maynes Taggart PLLC. As counsel, Messrs. Maynes and Taggart will, among other things: a. give the Debtor legal advice with respect to his powers and duties under Chapter 11; b. take the necessary action to avoid liens as required, and assist the Debtor in performing his other statutory duties; and c. prepare on behalf of your applicant all necessary applications, answers, orders, reports, and any other legal papers required by the Court. The hourly rates of the firms' personnel are: Mr. Maynes $180 Mr. Taggart $170 Staff $75 To the best of Debtor's knowledge, Messrs. Maynes and Taggart are "disinterested persons" as that term is defined in Section 101(14) of the Bankruptcy Code. About The Leed Corporation Twin Falls, Idaho-based The Leed Corporation -- dba Green Cut Sprinklers and Landscaping, Leed Corp., Quality Built Homes, Green Cut Construction, Shoshone Developers, Desert Green Sprinklers & Landscaping, Green Cut Lawn Care, and Desert Green -- is a real estate developer, including new construction and land development, as well as landscaping and related care and maintenance of existing real estate in southern Idaho, primarily based out of Shoshone, Idaho. The Company filed for Chapter 11 protection (Bankr. D. Idaho Case No. 10-40743) on April 29, 2010. The Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts in its Chapter 11 petition. LEHMAN BROTHERS: Mason Capital Seeks Rejection of Plan ------------------------------------------------------ Mason Capital Management LLC asks Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York to deny confirmation of the proposed Chapter 11 plan of Lehman Brothers Holdings Inc. and its affiliated debtors. Mason Capital complains that the proposed plan favors two classes of creditors of LBHI. It points out that some creditors have to give up 20% of the value of their claims for the benefit of the holders of senior unsecured claims and general unsecured claims against the parent company. "The plan proposes to take about $1 billion of wealth from the pockets of a disfavored class of creditors and send it directly into the pockets of favored classes of creditors," says Mason Capital's lawyer, Drew Hansen, Esq., at Susman Godfrey LLP, in New York. Mason Capital manages investment funds and accounts that own about $380 million of notes issued by Netherlands-based Lehman Brothers Treasury Co., B.V., and guaranteed by LBHI. Its claims are treated under Class 5 of the plan. Mr. Hansen further argues that the plan's liquidation and recovery analysis "does not sufficiently demonstrate" that dissenting creditors such as Mason Capital would receive at least as much under the plan as under a Chapter 7 liquidation. Earlier, Judge James Peck approved an outline of the proposed plan, giving Lehman the go-signal to start soliciting votes from creditors. Lehman needs to obtain a majority of votes accepting the plan and a court order confirming the plan to finally emerge from bankruptcy protection. The proposed plan would enable LBHI and its affiliated debtors to pay an estimated $65 billion to their creditors. Under the plan, LBHI's senior unsecured creditors which have an estimated $83.724 billion in claims would recover 21.1% of their claims, down from 21.4% in the previous proposal filed by the company early this year. Meanwhile, the company's general unsecured creditors, which have an estimated $11.39 billion in claims, would recover 19.9% of their claims, up from 19.8% in the prior proposal. Judge Peck is set to hold a hearing on December 6, 2011, to consider confirmation of the plan. 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 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. Judge James Peck on Aug. 30, 2011, approved the disclosure statement, which outlines the major provisions of Lehman's $65 billion liquidation plan. The proposed plan would enable LBHI and its affiliated debtors to pay an estimated $65 billion to their creditors. Voting on the Plan ends on Nov. 4, 2011. A hearing to consider confirmation of the Plan is set for Dec. 6, 2011. 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: Proposes to Settle Dispute on $500-Mil. Setoff --------------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliated debtors filed a motion to settle a dispute with Bank of America N.A. over a $500 million setoff. The company previously sued Bank of America for improperly setting off against a Lehman account in violation of the automatic stay, an injunction that halts actions by creditors against a company in bankruptcy protection. Bank of America set off more than $500 million against LBHI's alleged debt to the bank weeks before the company's bankruptcy filing. Late last year, the U.S. Bankruptcy Court for the Southern District of New York ordered Bank of America to pay $501.8 million plus interest for violating the stay. The bank, however, appealed the decision. The proposed settlement requires Bank of America to drop its appeal and pay LBHI about 71% or $356 million plus interest. The bank will also reduce its derivatives claims against the company by $2.4 billion and its guarantee claims by another $2.1 billion. The motion also seeks approval of a settlement between LBHI and Merrill Lynch International, a subsidiary of Bank of America. The settlement calls for the reduction of Merrill's derivatives claims by $3 billion. Full-text copies of the agreements are available for free at: http://bankrupt.com/misc/LBHI_BofASettlement092811.pdf http://bankrupt.com/misc/LBHI_MerrillSettlement092811.pdf The Court will hold a hearing on October 19, 2011, to consider approval of the proposed settlements. The deadline for filing objections is October 12, 2011. 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 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. Judge James Peck on Aug. 30, 2011, approved the disclosure statement, which outlines the major provisions of Lehman's $65 billion liquidation plan. The proposed plan would enable LBHI and its affiliated debtors to pay an estimated $65 billion to their creditors. Voting on the Plan ends on Nov. 4, 2011. A hearing to consider confirmation of the Plan is set for Dec. 6, 2011. 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: Proposes 2012 Incentive Program ------------------------------------------------ Lehman Brothers Holdings Inc. and its affiliated debtors seek court approval to create a $12 million incentive plan for employees working to unwind their derivatives business. About 170 workers were hired this year to wind down the derivatives business. They are directly employed by LAMCO Holdings LLC, the entity created to manage Lehman assets. The employees participating under the proposed incentive plan are tasked to review and reconcile claims remaining from the more than 8,000 derivatives claims totaling more than $75 billion. As of August 30, 2011, Lehman recovered about $1.4 billion in cash from its derivatives assets, bringing the total amount of cash recovered to more than $13.6 billion since its bankruptcy filing. Valuation of Lehman derivatives contracts has also been substantially completed and 70% of the contracts with third- parties are considered to be "final settled," according to court filings. Last year, Judge James Peck approved an incentive plan, which offered a performance-based bonus pool of up to $15 million. Payments made under the 2012 incentive plan will also be based on the performance of the employees. A table comparing the 2011 and 2012 incentive plans is available for free at http://bankrupt.com/misc/LBHI_2012IncentivePlan.pdf Lehman also proposed to change certain aspects of the court- approved retention and recruitment program, including the criteria for the payment of contractual bonus to employees involved in the derivatives business. Judge Peck will hold a hearing on October 19, 2011, to consider approval of the 2012 incentive plan. The deadline for filing objections is October 12, 2011. 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 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. Judge James Peck on Aug. 30, 2011, approved the disclosure statement, which outlines the major provisions of Lehman's $65 billion liquidation plan. The proposed plan would enable LBHI and its affiliated debtors to pay an estimated $65 billion to their creditors. Voting on the Plan ends on Nov. 4, 2011. A hearing to consider confirmation of the Plan is set for Dec. 6, 2011. 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: Endurance, 4 Other Insurers to Pay D&O Defenses ---------------------------------------------------------------- Lehman Brothers Holdings Inc. seeks court order authorizing Endurance Specialty Insurance Ltd. and four other insurance firms to pay the defense costs of current and former officers and employees. The insurance policies of Endurance Specialty, certain underwriters at Lloyd's London, Illinois National Insurance Company, Chartis Excess Limited, and Axis Specialty Limited Bermuda cover the defense costs of Lehman officers and employees who are facing a number of lawsuits that stemmed from the company's bankruptcy filing. Collectively, the insurance firms provide $70 million in coverage for the 2007-2008 policy year. LBHI also seeks court approval of an agreement, which grants ACE Bermuda Insurance Ltd. and six other insurance firms a limited release of claims in connection with their payment of $90 million to settle a shareholder lawsuit in New York. A full-text copy of the agreement is available without charge at http://bankrupt.com/misc/LBHI_DebtReleaseDeal.pdf Earlier, Richard Fuld Jr., former Lehman chief executive, and 13 other officials entered into a deal with a group of investors to settle the lawsuit. The investors previously accused the officials of misleading them about the company's financial condition prior to its bankruptcy. Meanwhile, in connection with the $8.25 million settlement of the lawsuit filed by the state of New Jersey, ACE Bermuda and the Lehman officials reached an agreement granting the insurance firm a similar release of claims. The agreement is also subject to bankruptcy court approval. A full-text copy of the agreement is available without charge at http://bankrupt.com/misc/LBHI_ACEDebtReleaseDeal.pdf In a related development, Mr. Fuld and other Lehman officials ask Judge James Peck to authorize Certain Underwriters at Lloyd's and seven other insurers to pay $1.05 million to settle the lawsuits filed by city officials in California. Judge Peck will consider approval of the requests at the hearing scheduled for October 19, 2011. The deadline for filing objections is October 12, 2011. 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 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. Judge James Peck on Aug. 30, 2011, approved the disclosure statement, which outlines the major provisions of Lehman's $65 billion liquidation plan. The proposed plan would enable LBHI and its affiliated debtors to pay an estimated $65 billion to their creditors. Voting on the Plan ends on Nov. 4, 2011. A hearing to consider confirmation of the Plan is set for Dec. 6, 2011. 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: Has Settlement With Arch Insurance --------------------------------------------------- Lehman Brothers Holdings Inc. seeks court approval of an agreement to settle the claims of Arch Insurance Company against SCC Acquisitions Inc.'s subsidiaries. The settlement was reached as part of the SCC entities' effort to have their Chapter 11 plans confirmed by a bankruptcy court in California, which oversees their bankruptcy cases. Arch Insurance Company, a creditor of the SCC entities, and two other insurance companies hold more than $200 million in claims on account of the surety bonds they issued in connection with the SCC entities' real estate projects. Earlier, Arch Insurance intervened as plaintiff in the lawsuit filed by the SCC entities to "equitably subordinate" the claims of Lehman Commercial Paper Inc. and three other Lehman creditors. The insurance company demanded that the Lehman claims be subordinated to its claims. The Lehman creditors, together with the court-appointed trustee Steven Speier, proposed the Chapter 11 plans for the SCC entities. The hearing on the confirmation of those plans is scheduled for October 24, 2011. The proposed agreement calls for the settlement of Arch Insurance's claims against the SCC entities, and the waiver, release or assignment of those claims to the Lehman units including LBHI. The insurance company also agreed to forego certain distributions on its claims under the plans and dismiss its claims in the lawsuit. The settlement is memorialized in two separate agreements, copies of which are available without charge at: http://bankrupt.com/misc/LBHI_ArchIDSettlement.pdf http://bankrupt.com/misc/LBHI_ArchVDSettlement.pdf One agreement settles Arch Insurance's claims against the SCC entities that filed a voluntary petition while the other resolves claims against those SCC entities that were placed in bankruptcy protection through involuntary petition. The Court will hold a hearing on October 19, 2011, to consider approval of the agreements. The deadline for filing objections is October 12, 2011. 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 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. Judge James Peck on Aug. 30, 2011, approved the disclosure statement, which outlines the major provisions of Lehman's $65 billion liquidation plan. The proposed plan would enable LBHI and its affiliated debtors to pay an estimated $65 billion to their creditors. Voting on the Plan ends on Nov. 4, 2011. A hearing to consider confirmation of the Plan is set for Dec. 6, 2011. 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) LESARRA ATTACHED: Bankruptcy Converted to Chapter 7 --------------------------------------------------- American Bankruptcy Institute reports that Lesarra Attached Homes LP will be liquidated under the management of a trustee now that a secured creditor foreclosed on its property. As reported in the Troubled Company Reporter on July 22, 2011, the Debtor cited that it has no unencumbered assets left and there is no chance for a successful reorganization. Reno, Nevada-based Lesarra Attached Homes, L.P., filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 10-50808) on March 12, 2010. Stephen R. Harris, Esq., at Harris-Petroni, Ltd., in Reno, Nevada, represents the Debtor as counsel. The Company estimated its assets and liabilities at $10 million to $50 million. LEVEL 3 COMMS: Fitch Lifts Issuer Default Rating to 'B' ------------------------------------------------------- Fitch Ratings has upgraded the Issuer Default Rating (IDR) assigned to Level 3 Communications, Inc. (LVLT) and its wholly owned subsidiary Level 3 Financing, Inc. to 'B' from 'B-'. In addition, Fitch has upgraded the ratings assigned to the various debt securities issued by LVLT and Level 3 Financing by one notch as summarized at the end of this release. Fitch has assigned a 'BB-/RR2' rating to the 8.125% senior unsecured notes due 2019 assumed by Level 3 Financing. Fitch has removed LVLT's ratings from Rating Watch Positive and has assigned a Positive Rating Outlook for all of LVLT's ratings. Approximately $7.2 billion of debt as of June 30, 2011 is affected by Fitch's action. The rating actions follow LVLT's announcement that the company closed on its previously announced agreement to acquire Global Crossing Limited (GLBC) in a tax free, stock for stock transaction. The upgrade of LVLT's ratings recognizes, in part, the de- leveraging of the company's balance sheet resulting from its acquisition of GLBC. Pro forma for the acquisition, LVLT's leverage declines to 6.5 times (x) for the latest 12 month (LTM) period ended June 30, 2011 compared with the company's actual leverage of 8.1x as of June 30, 2011 and 7.5x as of Dec. 31, 2010. Moreover, based on the company's ability to realize anticipated operating cost synergies, the GLBC acquisition positions LVLT to further improve its credit profile and generate consistent levels of free cash flow. The transaction accelerates LVLT's progress in achieving its target leverage ratio of 3.0x to 5.0x. The Positive Rating Outlook reflects Fitch's belief that LVLT's credit profile will strengthen as the company achieves the cost synergies associated with the GLBC acquisition. Fitch anticipates that LVLT's credit protection metrics during 2012 will remain relatively consistent with year end 2011 metrics as integration costs will largely offset positive operating momentum. Fitch expects LVLT's leverage as of year end 2011 (on a pro forma basis) will approximate 6.2x and dip below 6.2x as of year end 2012. Fitch expects to observe the strengthening of LVLT's credit metrics during 2013 as cost synergies begin to take effect. From Fitch's perspective the GLBC acquisition strengthens LVLT's competitive position. In addition to increasing LVLT's scale, the acquisition enhances the breadth and depth of LVLT's service offering and permits the company to expand into new markets. Importantly, the acquisition broadens the spectrum of customers LVLT serves including large multi-national enterprise customers. GLBC's network complements LVLT's existing network and the combined network positions LVLT as a global network operator enabling the company to expand existing customer relationships and capture new customer opportunities. Achievement of expected cost synergies is reasonable from Fitch's viewpoint. LVLT anticipates the transaction will yield annualized cost synergies of approximately $340 million including annualized capital expenditure reduction of $40 million. Over 50% of the expected cost synergies are coming from network expense and capital expense savings. Fitch anticipates that network cost synergies will be realized as GLBC network traffic is migrated to LVLT's network and the company leverages the collective 'on-net' footprint to reduce third-party network access costs. Additional cost synergies will be realized as LVLT rationalizes its combined network and eliminates duplicate circuits. LVLT expects to achieve two-thirds of the run rate cost synergies within 18 months of the closing of the transaction. The cost of synergies is expected to range between $200 million and $225 million, and half of the costs will be spent during the first year following the close of the transaction. Fitch believes LVLT's ability to manage the integration process and limit the disruption to the company's overall operations is key to the success of the transaction. The integration of the networks is primarily focused on long haul assets. LVLT has a successful history of integrating long haul assets with the company's acquisition of Genuity, WilTel and the long haul portion of the Broadwing acquisition. LVLT's liquidity position is adequate given the rating and is primarily supported by cash carried on its balance sheet, which as of June 30, 2011 totaled approximately $584 million. The company does not maintain a revolver and relies on capital market access to replenish cash reserves, which when combined with the lack of positive free cash flow generation limits the company's financial flexibility in Fitch's opinion. However, after considering the effects of the GLBC acquisition, LVLT's cash balance should increase to over $1.1 billion (calculation includes LVLT and GLBC cash as of June 30 as well as net cash generated from financing activities related to the close of the GLBC acquisition) as of June 30, 2011 on a pro forma basis. Fitch believes LVLT's cash position is sufficient to address scheduled maturities during 2012 and 2013 (totaling $566 million) while funding anticipated free cash flow deficits. LVLT's next significant maturity tower is in 2014 when approximately $2.5 billion ($3.2 billion pro forma for the transaction) of debt is scheduled to mature. Positive rating actions will likely occur as the company demonstrates that it is successfully integrating GLBC without material disruption to its operations. Equal consideration will be given to the company's ability to attain cost synergies while maintaining positive operational momentum. Evidence of positive operating momentum includes stable to expanding gross margins and revenue growth within the company Core Network Services segment. Fitch would expect LVLT to be generating consistent positive free cash flow and reduce leverage to 5.5x before taking a positive rating action. A stabilization of the Rating Outlook at the current rating level would coincide with LVLT experiencing difficulty or delay in fully integrating GLBC and achieving anticipated cost synergies. A weakening of LVLT's operating profile, as signaled by deteriorating margins and revenue erosion brought on by difficult economic conditions or competitive pressure will likely lead to negative rating action. Overall, Fitch's ratings incorporate LVLT's highly levered balance sheet, its weaker competitive position and lack of scale relative to larger and better capitalized market participants. The ratings for LVLT reflect the company's strong metropolitan network facilities position relative to alternative carriers, as well as the diversity of its customer base and service offering, and a relatively stable pricing environment for a significant portion of LVLT's service portfolio. Based largely on LVLT's strategy to invest in metropolitan facilities and carry more communications traffic on its network, the company derives strong operating leverage from its cost structure and network, enabling it to enhance margins and rapidly increase cash flows once revenue growth returns. Additionally, Fitch expects that the company can further strengthen its operating leverage as it continues to migrate its revenue mix to more margin rich data services and away from lower margin voice services. Fitch has upgraded the following ratings with a Positive Outlook: LVLT: -- IDR to 'B' from 'B-'; -- Senior unsecured notes to 'B-/RR5 from 'CCC/RR5'. Level 3 Financing, Inc.: -- IDR to 'B' from 'B-'; -- Senior secured term loan to 'BB/RR1' from 'BB-/RR1'; -- Senior unsecured notes to 'BB-/RR2' from 'B+/RR2'. Fitch has assigned the following ratings with a Positive Outlook: Level 3 Financing, Inc.: -- Senior unsecured notes due 2019 'BB-/RR2'. LEVEL 3: Assumes Awards Under the Global Crossing Plan ------------------------------------------------------ Level 3 Communications, Inc., filed with the U.S. Securities and Exchange Commission a Post-Effective Amendment No.1 on Form S-8 to Form S-4 registration statement in connection with up to 13,921,536 shares of the Company's common stock, par value $0.01 per share that are reserved for issuance by the Company upon the exercise of outstanding stock options granted under the 2003 Global Crossing Limited Stock Incentive Plan to individuals who are employed by or directors of Global Crossing Limited at the effective time of the Amalgamation, as well as 44,865,376 shares of Common Stock issuable pursuant to restricted stock units granted under the Global Crossing Plan, which will be withheld by the Company upon settlement in connection with the Amalgamation for purposes of satisfying the award holders' withholding tax obligations and returned to the available share reserve for future issuance under the Global Crossing Plan. All those shares of Common Stock were originally registered on the Form S-4. On Oct. 4, 2011, Global Crossing will have amalgamated with a wholly owned subsidiary of the Company. Pursuant to the terms of the Amalgamation, at the effective time of the Amalgamation, all outstanding awards issued under the Global Crossing Plan will have been assumed by the Company and converted into awards with respect to the Company's Common Stock, based on a formula described in the Form S-4. About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. The Company's balance sheet at June 30, 2011, showed $8.86 billion in total assets, $9.29 billion in total liabilities, and a $432 million total stockholders' deficit. Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. LEVEL 3: Completes Acquisition of Global Crossing Limited --------------------------------------------------------- Level 3 Communications, Inc., completed its acquisition of Global Crossing Limited. The transaction was structured as a tax-free, stock-for-stock exchange. The company also announced that it will conduct its business on a worldwide basis using the Level 3 Communications name with a new brand identity that incorporates elements from both companies, representing their combined strengths. In addition, the company announced plans to transfer the listing of its common stock to the New York Stock Exchange, and expects to begin trading on the NYSE on Oct. 20, 2011, under its current ticker symbol "LVLT". The company will continue to trade on the NASDAQ Global Select Market until the transfer is completed. In conjunction with listing on NYSE, the Company will implement a 1-for-15 reverse stock split of the Level 3 common stock. Level 3 now will operate a services platform for medium to large enterprise, wholesale, content and government customers, anchored by extensive owned fiber networks on three continents in more than 45 countries as well as substantial undersea facilities. "Our enterprise is now a global, state-of-the-art communications company that is substantially bigger and financially stronger, with an unrivaled IP/optical network and global reach, and an entrepreneurial culture singularly focused on the customer experience," said James Q. Crowe, chief executive officer of Level 3. "We believe the rapidly evolving communications market represents an extraordinary opportunity for us, and we are well positioned to capitalize on it." Listing of Common Stock on New York Stock Exchange and Reverse Stock Split The Company anticipates that the reverse stock split will be effective after the close of trading on Oct. 19, 2011, and that Level 3 common stock will begin trading on a split adjusted basis on the NYSE at the opening of trading on Oct. 20, 2011. At Level 3's annual meeting of stockholders held on May 19, 2011, the stockholders approved a reverse stock split, at the discretion of the board. "With the closing of our acquisition of Global Crossing, Level 3 is a very different company, delivering advanced IP-optical services over an expanded global footprint," said Crowe. "The NYSE is the world's largest stock exchange and market innovator, and we believe the NYSE is an ideal platform for the continued growth of our company." "We congratulate Level 3 on closing its acquisition of Global Crossing and look forward to welcoming the company to the NYSE family," said Duncan L. Niederauer, CEO, NYSE Euronext. "With this transaction Level 3 affirms its position as a leading communications provider, and with its listing on the NYSE, we are proud to add Level 3 to our unparalleled community of issuers and our ever-growing population of top technology companies. NYSE Euronext is committed to providing Level 3 and its shareholders with the highest levels of market quality, global brand visibility and issuer services." "Level 3 is a key provider of infrastructure based on the high quality services they provide, their ability to scale, and their network reach," said Andy Bach, senior vice president and Global Head of Network Services, NYSE Euronext. "Level 3 has played a valuable role by providing us with reliable connectivity throughout our SFTI network and to the Internet." When the reverse stock split becomes effective, every 15 shares of issued and outstanding Level 3 common stock will be automatically combined into one issued and outstanding share of Level 3 common stock without any change in the par value per share. This will reduce the number of outstanding shares of Level 3 common stock from approximately 3.1 billion to approximately 207 million and the number of authorized shares of Level 3 common stock from approximately 4.4 billion to 293 million. Proportional adjustments will be made to Level 3's outstanding convertible debt, warrant, equity awards and to its equity compensation plan to reflect the reverse stock split. Prior to the Oct. 20, 2011, NYSE listing date, Level 3 stockholders holding certificated shares will receive instructions from Wells Fargo Shareowner Services, the Company's transfer agent, regarding the exchange of outstanding pre?split stock certificates for book-entry shares of Level 3 common stock reflecting the reverse stock split. No fractional shares will be issued in connection with the reverse stock split. Following the completion of the reverse stock split, Level 3's transfer agent will aggregate all fractional shares that otherwise would have been issued as a result of the reverse stock split and those shares will be sold by the transfer agent into the market. Stockholders who would otherwise hold a fractional share of Level 3 common stock will receive a cash payment from the proceeds of that sale in lieu of that fractional share. Combination Creates Company with Significant Financial Resources The combined business had pro forma 2010 revenues of $6.2 billion and pro forma 2010 Adjusted EBITDA of $1.3 billion before synergies and $1.6 billion after expected synergies. Total synergies are expected to be approximately $300 million of run- rate EBITDA, of which the company expects to realize the substantial majority within 18 months. As a result of the completed transaction, Level 3 expects the combination to be accretive to Level 3 on a Free Cash Flow per share basis in 2013. The transaction improves Level 3's credit profile and reduces the Company's financial leverage from approximately 6.8x net debt to Consolidated Adjusted EBITDA for 2010 to approximately 4.4x after realization of expected synergies. As part of the closing of the transaction, Level 3 is redeeming and discharging approximately $1.35 billion of Global Crossing's outstanding consolidated debt. Approximately $430 million of Global Crossing (UK) Finance PLC Senior Secured notes due 2014 will be redeemed on Nov. 3, 2011, at the current redemption premiums outlined in its indenture dated Dec. 23, 2004. All of the aggregate principal amount of the $750 million of Global Crossing Limited's outstanding 12% senior notes due 2015 and all of the outstanding $150 million of 9% senior notes due 2019 will be redeemed in early November 2011. Of the outstanding principal of each of the Global Crossing Limited senior notes, 35 percent first will be redeemed on Nov. 3, 2011, as a result of a qualified "Equity Offering" to its new corporate parent. The remaining 65 percent of the outstanding principal of each issue of the Global Crossing senior notes will be redeemed subsequently on Nov. 4, 2011 at "make-whole" prices calculated using the rate of the comparable U.S. Treasury security plus 50 basis points. "The company has an improved balance sheet and credit profile immediately at closing, with further improvement as we achieve the expected synergy benefits," said Sunit Patel, executive vice president and chief financial officer of Level 3. "As a result of potential revenue growth and synergies, over the longer term, we expect to have significant Free Cash Flow available for investment in high-return opportunities, including U.S. and international network expansions. We continue to feel good about our business for the remainder of the year, and have improved confidence around our synergy targets." Organizational Announcements The Company will operate through three geographically organized business units in EMEA (Europe, the Middle East and Africa), Latin America and North America, and each business unit will have one leader accountable for sales, operations and marketing for that region. Corporate functions will be centralized in North America and will support the company globally. The corporate headquarters of the company will remain in Broomfield, Colo. "I'm particularly pleased with the management team we've put in place to lead the company going forward," said Crowe. "We have brought a number of senior executives from Global Crossing onto the team in leadership roles. I think we have an exceptionally strong group of senior executives." "I want to thank John Legere, CEO of Global Crossing, for his leadership, support and advice during the integration planning period. On behalf of all of the employees of the new company he helped create, I wish him all the best in his new endeavors," said Crowe. Further information regarding the combined Company's executive leadership is available at www.level3.com/About-Us/Company- Information/Management-Team.aspx. Both Companies Represented on Board of Directors The Company's board of directors includes members of each Company's boards, including Walter Scott, Jr. (Chairman), James Q. Crowe, Admiral Archie Clemins, Admiral James O. Ellis, Peter Seah Lim Huat, Richard R. Jaros, Lee Theng Kiat, Michael J. Mahoney, Charles C. Miller III, John T. Reed and Dr. Albert C. Yates. Terms of Transaction Under the terms and subject conditions of the acquisition agreement, Global Crossing shareholders are receiving 16 shares of Level 3 common stock for each share of Global Crossing common stock or preferred stock that is owned at closing. Level 3 will issue approximately 1.3 billion shares for this transaction, and on a pro forma basis and before the implementation of the reverse stock split will have approximately 3.1 billion shares outstanding as of July 29, 2011. Integration Planning Progress "The integration planning effort has been very productive, and we are ready to begin integrating our operations today," said Jeff Storey, president and chief operating officer of Level 3. "Business remains strong across both companies, and we continue to feel confident about the synergy targets we identified when we announced this transaction. Our number one objective is to maintain our focus on providing an industry-leading customer experience, while also achieving our expected synergies." For more information on the benefits of the transaction, view the press release announcing the transaction at www.level3globalcrossingacquisition.com. For more information on Level 3's advanced network and service offerings, visit www.level3.com. A full-text copy of the Form 8-K disclosure is available for free at http://is.gd/FqDALl About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. The Company's balance sheet at June 30, 2011, showed $8.86 billion in total assets, $9.29 billion in total liabilities, and a $432 million total stockholders' deficit. Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. LIBERTY MUTUAL: S&P Affirms 'BB' Junior Subordinated Debt Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on LMGI and the members of the Liberty Mutual Intercompany Pool, the Peerless Intercompany Pool, and other rated insurance affiliates (collectively, Liberty) to positive from stable. "At the same time, we affirmed our 'BBB-' long-term counterparty credit and senior unsecured debt ratings and our 'BB' junior subordinated debt rating on LMGI, our 'A-' long-term counterparty credit and insurer financial strength ratings on Liberty, and our 'BBB' surplus notes rating on Liberty Mutual Insurance Co. In addition, we affirmed the 'A-2' short-term counterparty credit and commercial paper ratings on LMGI," S&P) . "The outlook revision reflects our view that LMGI's results improved in 2010, and that the first six months of 2011 performance compares favorably with peers' and the P/C industry's," said Standard & Poor's credit analyst Birgitte Arendal. "Catastrophe volatility has reduced the industry's overall operating results. We believe and expect Liberty's workers' compensation book to exert moderate downward pressure on operating profitability, but we expect other lines of business to perform substantially better, with a combined ratio of less than 100%. Strong net investment income remains a significant source of earnings for Liberty." "The rating affirmations reflect our view of Liberty's leading market presence in the U.S. and select international markets, and its well-diversified business mix by product and geographic region. The ratings also reflect our view of the group's strong investments, very strong liquidity, and favorable expense differentiation," S&P related. The outlook is positive. Management has been shifting its business allocation, and its earnings streams are more diversified. "We expect this to support better operating performance prospectively," S&P said. "The positive outlook reflects our view that if Liberty continues to improve its operating performance during the next two years, including management's efforts to improve workers' compensation earnings, we could raise our holding company and operating company ratings by one notch. We also expect Liberty to perform similarly to the industry overall, and better excluding workers' compensation, to continue to enhance its risk management and ECM practices, to maintain its strong competitive position, and demonstrate capital adequacy above the rating level. However, the ratings could come under pressure if Liberty's overall operating performance deteriorates significantly with a combined ratio of more than 110%, including three to four percentage points of normalized catastrophe losses, and workers' compensation profitability declines with performance worse than the industry's and peers'. In addition, if its strong enterprise risk management capabilities deteriorate, or if its capital adequacy declines below the rating level, we could lower the ratings," S&P added. LIBERTY TIRE: Moody's Lowers CFR to 'B3'; Outlook Negative ---------------------------------------------------------- Moody's Investors Service has lowered all the ratings of Liberty Tire Recycling Holdco, LLC, including the corporate family rating to B3 from B2. The rating outlook has been revised to negative from stable. The rating changes are: Corporate family, to B3 from B2 Probability of default, to B3 from B2 $200 million senior unsecured notes to Caa1 LGD4, 64% from B3 LGD4, 64% Rating outlook, Negative RATINGS RATIONALE The downgrade reflects a high expansion spending level and low operating profits, which have resulted in credit metrics that are below the levels that Moody's anticipated when the rating was initially assigned, in September 2010. A portion of the performance shortfall stems from delayed ramp-up at a new-build tire processing facility, in Ontario, Canada, where project scope has grown. Without the facility yet operational, Liberty Tire has been re-routing used tires from Canada to an alternate plant in New York, incurring extra storage and transportation expenses. Beyond the Ontario plant project, Liberty Tire undertook four acquisitions in 2011 and acquisitions often entail integration costs, and follow-on capital spending to boost equipment capabilities. Further, working capital grew notably in H1-2011, in part due to customer order delays. About half of the company's (unrated) $60 million revolving credit facility has been drawn thus far in 2011 due to soft earnings, working capital growth and expansion spending. A recently hired Chief Operating Officer may help boost efficiency levels and the company plans to ratchet down the acquisition spending pace, but Moody's anticipates an EBIT to interest ratio below 1x (Moody's adjusted basis) across 2012. At the current earnings level Moody's does not anticipate much in the way of sustainable free cash flow generation, though working capital could decline near-term with better inventory management and collections. This performance is more consistent with the B3 rating category. Adequate headroom presently exists under the revolving credit facility's financial ratio tests. Assuming stabilization of working capital and no further margin erosion, covenant headroom should continue near-term. Additionally, if the Ontario plant comes fully online, interest coverage metrics could rise to levels on par with the rating, from low levels currently. The negative rating outlook acknowledges that economic weakness could depress sales of higher margin, processed tire end products- - such as crumb rubber whose demand is partly correlated with construction end markets. As well, Moody's does not anticipate coal market prices rising from current levels and thereby raising demand for tire-derived fuel (a substitute for coal in some industrial applications). Without higher demand for Liberty Tire's end products, net losses could continue. Should the performance trend continue, revolver borrowings could further rise and weaken the liquidity profile. Stabilization of the rating outlook would depend on the Ontario, Canada plant becoming operational and expectation of EBIT to interest of approximately 1x, debt to EBITDA of 6x or less and sustained liquidity profile adequacy. The ratings could be downgraded if Moody's were to expect a weak liquidity profile, EBIT to interest continuing below 0.8x, or negative free cash flow. Upward rating momentum, not currently anticipated, would depend on EBIT to interest above 1.2x with debt to EBITDA at or below 5x. The principal methodology used in rating Liberty Tire Recycling Holdco, LLC was the Global Manufacturing Industry Methodology published in December 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Liberty Tire Recycling Holdco, LLC., headquartered in Pittsburgh, PA is a scrap tire collector and recycler in the United States. Revenues in 2010 were just under $250 million. The company is majority-owned by American Securities, LLC. LKQ CORPORATION: Moody's Affirms 'Ba2' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service affirmed the ratings of LKQ Corporation's (LKQ) -- Corporate Family and Probability of Default ratings at Ba2. In a related action Moody's affirmed the ratings of LKQ's upsized $950 million senior secured revolver and existing senior secured term loan at Ba2, and assigned a Ba2 rating to the new $200 million delayed draw senior secured term loan. The upsized senior secured revolver will be used to fund LKQ's recently announced acquisition of Euro Car Parts, Ltd. for an initial purchase price of $347 million. The purchase agreement provides that the purchase price could increase by up to $85 million if Euro Car Parts meets certain growth targets in 2012 and 2013. LKQ's Speculative Rating of SGL-2 also was affirmed. LKQ's rating outlook remains stable. Euro Car Parts Ltd., based in the United Kingdom, is a leading distributor of parts for all makes of cars and light commercial vehicles. The company carries over 114,000 stocked part numbers and serves more than 120,000 commercial customers. LKQ estimates Euro Car Parts' revenues in the fourth quarter of 2011 to approximate $120 - $125 million. Ratings Assigned: Ba2 (LGD4, 50%) to the new $200 million delayed draw senior secured term loan; Ratings Affirmed: Corporate Family Rating, Ba2; Probability of Default, Ba2; Ba2 (LGD4, 50%) to the upsized $950 million senior secured revolving credit facility; Ba2 (LGD4, 50%) to the existing $247 million (remaining amount) senior secured term loan; Speculative Grade Liquidity Rating: SGL-2 RATINGS RATIONALE LKQ's Ba2 Corporate Family Rating reflects Moody's expectation that the company's credit metrics will continue to support the assigned rating following the acquisition of Euro Car Parts Ltd. Pro forma for the transaction, Debt/EBITDA is expected to approximate 2.9x (including Moody's standard adjustments) compared to 2.3x for LKQ's LTM period ending June 30, 2011. LKQ has a strong history of successfully acquiring and integrating "bolt-on" acquisitions, which have increased the company's geographic reach and product offerings. However, the Euro Car Parts transaction will pose some challenges. It will be LKQ's second-largest acquisition after acquiring Keystone Automotive in 2007, it will be the company's first acquisition in Europe, and the transaction will be completely debt financed. Partially mitigating the risks involved with this transaction is Moody's expectation that the operations of Euro Car Parts will remain largely separate over the near-term, posing modest downside risk to LKQ's North American operations. Over time, the transaction is expected to support cross selling opportunities for LKQ and Euro Car Parts. The stable outlook considers LKQ strong metrics for the Ba2 rating level and Moody's expectation that LKQ will successfully integrate the Euro Car Part business, consistent with the company's past experience. The outlook also incorporates the risk that this transaction provides an entry point for additional European debt financed acquisitions. The company's good liquidity profile should provide sufficient financial flexibility to offset integration risk. As of June 30, 2011, LKQ maintained strong credit metrics (as adjusted by Moody's) with EBIT/Interest approximating 7.0x and Debt/EBITDA approximating 2.3x. Future events that have the potential to drive LKQ's outlook or ratings higher include: successful integration of the Euro Car Parts acquisition along with continued growth and penetration in LKQ's domestic markets; sustained operating performance including EBIT margins (as adjusted by Moody's) of over 10%, EBIT/Interest at or above 5x, and Debt/Revenues approaching 30%. Future events that have the potential to drive LKQ's outlook or ratings lower include: significant key customer attrition, complications in the integration of acquisitions, or a significant deterioration in liquidity. Consideration for a lower outlook or rating could arise if any combination of these factors results in leverage being maintained at 3.5x or EBIT/interest coverage below 3.0x. LKQ is expected to continue to have a good liquidity profile following the acquisition supported by revolver availability and free cash flow generation. Pro forma for the close of the acquisition, the upsized $950 million revolving credit facility will have about $445 million of availability. In addition, the amended senior secured credit facilities will also included a delayed draw term loan of $200 million which will be unfunded at closing. LKQ is expected to generate positive free cash flow over the next twelve months after required term loan amortization, consistent with the company's historical performance. The primary financial covenants under the senior secured facilities will continue to be a maximum net debt/EBITDA test and a minimum interest coverage test. LKQ should remain in compliance with these covenants over the near-term. Alternative liquidity is limited as essentially all of the company's domestic assets secure the bank credit facilities. The principal methodology used in rating LKQ Corporation was the Global Automotive Supplier Industry Methodology published in January 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. LKQ Corporation is the largest nationwide provider of aftermarket and recycled collision replacement parts and refurbished collision replacement products such as wheels, bumper covers and lights, and a leading provider of mechanical replacement parts including remanufactured engines, all in connection with the repair of automobiles and other vehicles. LKQ also has operations in Canada, Mexico, Central America, and the United Kingdom. LKQ operates more than 340 facilities, offering its customers a broad range of replacement systems, components and parts to repair automobiles and light, medium and heavy-duty trucks. Revenues in 2010 were approximately $2.5 billion. LOCATION BASED TECHNOLOGIES: Launches PocketFinder in Apple Stores ------------------------------------------------------------------ Location Based Technologies, Inc., announced the launch of its unique and easy to use PocketFinder GPS Personal Locator and GPS Vehicle Locator devices for purchase throughout the United States and Canada exclusively from all Apple Retail Stores and the Online Apple Store. Sales are expected to begin this month. PocketFinder's Personal Locator fits easily in a pocket, purse or backpack and provides real-time information that allows users to locate the devices online at any time from almost anywhere. The portable GPS Personal Locators are especially useful in locating children and elderly seniors who might get lost. The devices are as easy to recharge as a cell phone. PocketFinder Vehicle attaches to automobiles, recreational vehicles, motorcycles, boats, snowmobiles, jet skis?virtually any powered vehicle. It allows users to pinpoint the location of the vehicles as well as their speeds-capabilities especially welcomed by parents of teenage drivers. The compact GPS Vehicle Locator can also help authorities to quickly find a lost or stolen vehicle. "Just because you are on the move doesn't mean that you have to be out of touch with the most important elements of business or life. We optimize the way technology allows you to know the "location" of what you value, even when you cannot be there," stated Dave Morse, CEO of Location Based Technologies. "Selling our products through Apple Online and Retail stores fits perfectly with our focus on quality and service as we provide customers with peace of mind in knowing where people, pets and things that are most important to them are located at all times." The heart of the PocketFinder system is the online PocketFinder GPS User Interface and an iOS App for the iPod touch, iPhone, and iPad which can also be accessed via a web browser. The online PocketFinder GPS Mapping Application pinpoints the location of all selected PocketFinder GPS Personal and Vehicle Locators. Users can customize the map application by establishing zones that automatically send alerts if a loved one enters or leaves a zone on foot or in a vehicle. In addition, speed alerts can be set that notify users if a vehicle exceeds set speed limits. Alerts are sent instantly via email, SMS text, and push notification. MSRP for the PocketFinder GPS Personal Locator is $149. The PocketFinder GPS Vehicle Locator is $189. Both include two months of activation. Ongoing monthly wireless connectivity charges are $12.95. About Location Based Technologies Headquartered in Irvine, Calif., Location Based Technologies, Inc. (OTC BB: LBAS) -- http://www.locationbasedtech.com/-- designs, develops, and sells personal, pet, and vehicle locator devices and services. As reported in the Troubled Company Reporter on Dec. 22, 2010, Comiskey & Company, in Denver, Colo., expressed substantial doubt about Location Based Technologies' ability to continue as a going concern following its results for the fiscal year ended August 31, 2010. The independent auditors noted that the Company has incurred recurring losses since inception and has an accumulated deficit in excess of $28,800,000 and a working capital deficit in excess of $5,900,000. The Company's balance sheet at May 31, 2011, showed $1.77 million in total assets, $7.70 million in total liabilities and a $5.93 million in total stockholders' deficit. LONE EAGLE: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: Lone Eagle Resorts, Inc. dba Pybus Point Lodge P.O. Box 33497 Juneau, AK 99803 Bankruptcy Case No.: 11-34315 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: William T. Thurman Debtor's Counsel: Anna W. Drake, Esq. ANNA W. DRAKE, P.C. 175 South Main Street, Suite 300 Salt Lake City, UT 84111 Tel: (801) 328-9792 Fax: (801) 413-1620 E-mail: annadrake@att.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $100,001 to $500,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Scott L. Jorgensen, president. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- North Cove Adventures, LLC 11-34304 09/30/11 LONGYEAR PROPERTIES: Reorganization Case Converted to Liquidation ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts converted the Chapter 11 case of Longyear Properties, LLC, to one under Chapter 7 of the Bankruptcy Code. The creditor trustees of Longyear at Fisher Hill Condominium Trust, in their renewed request, requested that the Court convert the Debtor's case and require the Debtor to: (i) pay the municipal taxes on all five units within 30 days; (2) stay current with the postpetition taxes; (3) timely pay the common area charges to the Condominium Trust; and (4) pay the postpetition common fess for all five units within 90 days. As reported in the Troubled Company Reporter on July 26, 2011, the Court denied the trustee's motion to convert the Debtor's case. The TCR reported on June 27, 2011, the Condominium Trust pointed out that in the nine months it has been in bankruptcy, the Debtor has failed to provide any evidence of a viable business as its only assets consist of five condominium units which it has been unable to sell. The Debtor has also failed to remain current with any of its postpetition debt obligations, the Condominium Trust cites. No equity in the units exist, and extensive administrative costs from professional fees are accumulating, the Condominium Trust adds. "All these factors establish a substantial and continuing loss to and diminution of the estates." On Sept. 29, 2011, William K. Harrington, the U.S. Trustee for Region 1 appointed: Harold B. Murphy Murphy & King, P.C. One Beacon Street Boston, MA 02108?3107 E-mail: as interim trustee and is designated to preside at the meeting of creditors. The Court approved the trustee's bond under the general blanket bond. The trustee will notify the U.S. Trustee immediately in the event that the liquid assets exceed $1,000,000. About Longyear Properties, LLC Norwood, Massachusetts-based Longyear Properties, LLC, was formed in 1996 for the purpose of developing residential property known as "Longyear at Fisher Hill" located at 120 Seaver Street, in Brookline, Massachusetts, from a single-family home to a residential condominium comprising forty three units. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Mass. Case No. 10-20326) on Sept. 22, 2010. Stewart F. Grossman, Esq., Pamela A. Harbeson, Esq., and Heather Zelevinsky, Esq., at Looney & Grossman LLP, in Boston, represented the Debtor. In its schedules, the Debtor disclosed $14,790,980 in assets and $13,576,208 in liabilities as of the Petition Date. LOS ANGELES DODGERS: Judge May Limit Probe About MLB's Other Teams ------------------------------------------------------------------ Peg Brickley, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Kevin Gross said Wednesday he is inclined to turn down a bid by the Los Angeles Dodgers to probe Major League Baseball's dealings with other MLB members for proof Commissioner Bud Selig is treating the ball club unfairly. Lance Duroni at Bankruptcy Law360 relates such ruling potentially denies owner Frank McCourt ammunition in the parties' upcoming showdown over control of the franchise. "To open this up at this point to all of baseball, to all of the 29 teams" would be "burdensome," Judge Gross said Wednesday at the conclusion of nearly two hours of arguments on the issue in the U.S. Bankruptcy Court in Wilmington, Del., according to DBR. Judge Gross will start hearing evidence Oct. 31 in a battle between the Dodgers and owner Frank McCourt and Mr. Selig over McCourt's plan to sell media rights to pay the team's bills. According to DBR, Judge Gross said he will release a formal decision later and could change his mind. "In my mind the power of the commissioner is akin to, but far greater than, what we would call the business judgment rule," Judge Gross said. DBR notes that Delaware's "business judgment rule" limits judicial second-guessing of corporate decisions, requiring courts to bow to business decisions that are not tainted with self-interest. In the Dodgers bankruptcy case, that could mean the team will have to prove Mr. Selig perpetrated a wrong on the Dodgers when he turned down the broadcast rights sale that would have eased a liquidity crunch. DBR recounts MLB attorneys say there's no comparison between the Dodgers, who have been caught up in Mr. McCourt's divorce proceedings, and other teams, and no rules for Mr. Selig's decisions when it comes to what's best for baseball. About 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. In its schedules, the LA Dodgers baseball club listed $77,963,734 in assets and $4,695,702 in liabilities. LA Real Estate LLC listed $161,761,883 in assets and $0 in liabilities. 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. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Public relations specialist Kekst and Company has been hired for crisis support. Covington & Burling LLP serves as special counsel. An official committee of unsecured creditors has been appointed in the case. The panel has tapped Lazard Freres & Co. as financial adviser and investment banker, and Morrison & Foerster LLP and Pinckney, Harris & Weidinger, LLC as counsel. Ticket holders are seeking the appointment of their own committee. The LA Dodgers is the 12th sports team in North America to have sought bankruptcy protection, according to The Wall Street Journal. The reorganization is being financed with a $150 million unsecured loan from the Commissioner of Major League Baseball. The loan gives the Commissioner few of the controls lenders often demanded from bankrupt companies. LOUISVILLE ORCHESTRA: Management Rejects Contract Proposal ---------------------------------------------------------- Elizabeth Kramer at the Courier-Journal reports that the Louisville Orchestra's management rejected a contract proposal from its musicians on Oct. 3, 2011. The moves came as the two sides were locked in intense negotiations that may determine the future of the city's professional orchestra. According to the report, the musicians said their proposal would have cut $750,000 from the previous contract's musician costs, then maintained a pay freeze for the next five years. It also would have cut the number of weeks in the orchestra's season and the number of full-time orchestra musicians, all terms management demanded in its contract proposal. The report says the musicians' proposal would have cut the number of players to 57 from the 71 required under their previous contract, which expired in May and cut the number of weeks in the 2011-12 season to 30 from the 37 in the expired contract. The musicians said their proposal also agreed to freeze pay at 2010-11 weekly pay levels for five years for the 60 full-time musicians who staffed the orchestra from September 2012 through May 2016. The cost difference between the musicians' and management's proposals is less than $190,000 for the contract's first year and a total projected budget of more than $5 million, the report quotes the musicians as saying. About Louisville Orchestra Based in Louisville, Kentucky, Louisville Orchestra, Inc. filed for Chapter 11 bankruptcy protection (Bankr. W.D. Ky. Case No. 10-36321) on Dec. 3, 2010. Judge David T. Stosberg presides over the case. Daniel T. Albers, Jr., Esq., Mark A. Robinson, Esq., and Robert Wagner, Esq., at Valenti Hanley & Robinson PLLC, represent the Debtor. In its schedules, Louisville Orchestra disclosed it had $412,000 in assets and $1.4 million in liabilities. The Louisville Symphony Orchestra won confirmation of its Chapter 11 plan on Aug. 17, 2011. The reorganization plan resulted from negotiations with JPMorgan Chase Bank NA and Fifth Third Bank, the two principal secured lenders. The non-profit symphony was founded in 1937 and filed for Chapter 11 relief last December in its hometown. In August, the Debtor announced the cancellation of concerts scheduled for September and October 2011. The symphony said that the musicians' union threatened to fine members who worked so long as there is no new contract. The symphony said it was offering musicians $925 a week plus benefits, the same as last season's wages. LYDIAN SF: Files Schedules of Assets and Liabilities ---------------------------------------------------- Lydian SF Holdings LLC filed with the U.S. Bankruptcy Court for the Northern District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $83,170,692 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $80,000,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $140,422 ----------- ----------- TOTAL $83,170,692 $80,140,422 About Lydian and First Street Holdings Lydian SF Holdings LLC and First Street Holdings NV LLC, in Oakland, California, filed separate Chapter 11 petitions (Bankr. N.D. Calif. Case Nos. 11-49301 and 11-49300) on Aug. 30, 2011. Judge Roger L. Efremsky presides over the First Street case while Judge Edward D. Jellen oversees the Lydian case. Iain A. Macdonald, Esq., at MacDonald and Associates, serves as the Debtors' counsel. Both Lydian and First Street estimated $50 million to $100 million in assets and $10 million to $50 million in debts. The petitions were signed by Graham Seel, SVP of CMR Capital, LLC, manager. LYMAN LUMBER: Court Okayed Cash Access Until Sept. 22 ----------------------------------------------------- The Honorable Dennis D. O'Brien has authorized Lyman Holding Company, et al., on a final basis to use cash collateral commencing on Sept. 2, 2011 and ending on Sept. 22, 2011, subject to certain conditions and limitations. The cash collateral use period may be extended without further order of the Court by stipulation of the Debtors and the Prepetition Lenders with an attached budged filed with the Court. All other parties will have the right to object to an extension and put the matter on for an expedited hearing. The Debtors may use the Cash Collateral during the Cash Collateral Use Period only for ordinary and reasonable disbursements substantially consistent with the budget, which budget may be amended from time to time with the consent of both the Debtors and the Agent, U.S. Bank National Association. Any amended Budget will be filed with the Court and will be in effect when filed, subject to the right of any party-in-interest to object. The objecting party may then seek an expedited hearing. However, the amended Budget will remain in full force and effect until the Court orders otherwise. In the event that the Debtors and Agent are not able to agree to an amended Budget, either one is authorized to move the Court for a new expedited hearing on the Cash Collateral Motion, and both the Debtors and the Agent will have their respective rights to either seek or oppose the use of Cash Collateral. In addition, at any time that, based on a "Budget Reconciliation" (i) the Debtors' actual net operating cash flow on a cumulative basis is more than 7.5% below the net operating cash flow reflected in the Budget, or (ii) there will be a change that has a material adverse effect on the use, value or condition of the Debtors, their assets or the legal or financial status or business operations, taken as a whole, the Agent may bring a motion seeking the termination of the Debtors' right to use Cash Collateral. In that event, both the Debtors and the Agent will have all rights to either seek or oppose the use of Cash Collateral. As adequate protection, the Prepetition Lenders will receive: * Replacement liens on and security interests in all of the Debtors' rights in, to , and under all present and after- acquired property and assets of the type that would constitute the Prepetition Collateral in accordance with applicable Prepetition Loan Documents. However, the Replacement Liens will not attach to any claims and causes of action possessed by the Debtors under Sections 544, 545, 547, 548, 549, or 550 of the Bankruptcy Code, or any proceeds thereof. The Replacement Liens will be subject only to the "Carve Out" and any valid, enforceable and non-avoidable liens and security interests senior to the Prepetition Lenders; liens and security interests as of the Petition Date; * Periodic payments of (i) all accrued but unpaid postpetition interest in the amounts and on the dates set forth in that certain Credit Agreement, and any interest not yet paid in accordance with the Interim Order, and (ii) certain payments to be applied to the principal balance due on the Prepetition Obligations as of the Petition Date; * The Debtors will pay to the Agent the reasonable, documented out-of-pocket fees and expenses of attorneys and other professional advisors retained by the Prepetition Lenders in connection with matters relating to the bankruptcy cases. The Debtors and the Creditors' Committee may object to the reasonableness of the fees and expenses included in any professional fee invoices; * To the extent that the adequate protection granted to the Prepetition Lenders proves to be inadequate to assure the full repayment to the Prepetition Lenders of all Cash Collateral used by the Debtors, the Prepetition Lenders will have an administrative expense claim against the Debtors under Section 507(b) of the Bankruptcy Code, with priority over all other administrative expense claims and unsecured claims against the Debtors, subject only to the Carve Out; * During the Cash Collateral Use Period, the Debtors will deliver to the Agent and the Creditors' Committee all items required to be delivered pursuant to the Interim Order; * The Debtors will permit the Agent to inspect the Collateral during normal business hours upon reasonable advance notice. The Debtors will also allow the Agent to periodically inspect and audit the books, records, and account statements of the Debtors in order to confirm their compliance with the Final Order and the Budget; * All Cash Collateral of the Prepetition Lenders collected by the Debtors will be immediately deposited with the Agent; and * The Prepetition Lenders will have the right to credit bid their claims to the fullest extent permitted by law in connection to any sale, auction or other disposition of the Collateral pursuant to Section 363(k) of the Bankruptcy Code and be treated as a "Qualified Bidder" without the necessity of making any deposits required of buyers under any sales procedures order or bidding procedures. However, (i) to the extent that any other right of the Prepetition Lenders to credit bid must be established, the terms will be established by the Debtors and the Prepetition Lenders or under terms established by Court order, and (ii) the right to credit bid will not preclude the Debtors from seeking an order to limit for cause the credit bid of an assignee of or other successor to the Prepetition Lenders' claims. Subject to any objections timely filed by the Official Committee of Unsecured Creditors, the Debtors' Cash Collateral Motion is granted in its entirety on a final basis, and all objections that have not been withdrawn or resolved are overruled on their merits. About Lyman Lumber Lyman Lumber Company sells building supplies, such as framing beams, roofing materials, siding and drywall to residential builders. The 113-year old company and several affiliates sought Chapter 11 petition (Bankr. D. Minn. Lead Case No. 11-45190) on Aug. 4, 2011. Judge Dennis O'Brien presides over the cases. Lyman Lumber estimated $50 million to $100 million in assets and $100 million to $500 million in debts. The petition was signed by James E. Hurd, president and chief executive officer. The affiliates that filed for Chapter 11 are: Lyman Holding Company; Automated Building Components, Inc.; Building Material Wholesalers; Carpentry Contractors Corp.; Construction Mortgage Investors Co.; Lyman Development Co.; Lyman Lumber of Wisconsin, Inc.; Lyman properties LLC; Mid-America Cedar, Inc.; Woodinville Lumber, Inc.; and Woodinville Construction Services LLC. Cynthia A. Moyer, Esq., Douglas W. Kassebaum, Esq., James L. Baillie, Esq., and Sarah M. Gibbs, Esq., at Fredrikson & Bryon, P.A., serve as bankruptcy counsel. BGA Management, LLC d/b/a Alliance Management, developed and executed a sale process and marketing strategy for the Debtors' assets. The Official Committee of Unsecured Creditors of Lyman Lumber Company tapped Fafinsky, Mark & Johnson, P.A., as its counsel. Alliance Management is the financial and turnaround consultant. When they filed for bankruptcy, the Debtors had in hand a term sheet with SP Asset Management, LLC, a unit of Steel Partners Holdings L.P., to serve as stalking horse bidder for the assets of the Debtors. New York City-based Steel Partners is a diversified holding company that owns and operates businesses in a variety of industries. LYMAN LUMBER: Term of Hilco Industrial Engagement Modified ---------------------------------------------------------- Lyman Holding Company, et al. sought and obtained the approval of the Honorable Dennis D. O'Brien to employ the professional auctioneering firm of Hilco Industrial, LLC as their auctioneer/liquidator with respect to certain non-real property assets of Woodinville Lumber, Inc. and Woodinville Construction, LLC, and to supplement that application. The Debtors filed a supplement to the joint employment application to address a concern raised by the U.S. Trustee about a term in the engagement agreement. Hilco Industrial has modified that term and the Debtors have executed an Amendment to the Agreement. The Debtors believe that the Amendment has been reviewed and accepted by the U.S. Trustee and that it satisfies his objections. The Court finds that Hilco Industrial does not hold or represent an interest adverse to the estate and that it is disinterested within the meaning of Section 327(a) of the Bankruptcy Code. Upon conclusion of the auction, the Debtors will be authorized to immediately pay in full Hilco Industrial's commission of 10% buyer's premium and its expenses, as set forth in the Agreement, as amended, and no further application for fees will be made by the auctioneering firm. About Lyman Lumber Lyman Lumber Company sells building supplies, such as framing beams, roofing materials, siding and drywall to residential builders. The 113-year old company and several affiliates sought Chapter 11 petition (Bankr. D. Minn. Lead Case No. 11-45190) on Aug. 4, 2011. Judge Dennis O'Brien presides over the cases. Lyman Lumber estimated $50 million to $100 million in assets and $100 million to $500 million in debts. The petition was signed by James E. Hurd, president and chief executive officer. The affiliates that filed for Chapter 11 are: Lyman Holding Company; Automated Building Components, Inc.; Building Material Wholesalers; Carpentry Contractors Corp.; Construction Mortgage Investors Co.; Lyman Development Co.; Lyman Lumber of Wisconsin, Inc.; Lyman properties LLC; Mid-America Cedar, Inc.; Woodinville Lumber, Inc.; and Woodinville Construction Services LLC. Cynthia A. Moyer, Esq., Douglas W. Kassebaum, Esq., James L. Baillie, Esq., and Sarah M. Gibbs, Esq., at Fredrikson & Bryon, P.A., serve as bankruptcy counsel. BGA Management, LLC d/b/a Alliance Management, developed and executed a sale process and marketing strategy for the Debtors' assets. The Official Committee of Unsecured Creditors of Lyman Lumber Company tapped Fafinsky, Mark & Johnson, P.A., as its counsel. Alliance Management is the financial and turnaround consultant. When they filed for bankruptcy, the Debtors had in hand a term sheet with SP Asset Management, LLC, a unit of Steel Partners Holdings L.P., to serve as stalking horse bidder for the assets of the Debtors. New York City-based Steel Partners is a diversified holding company that owns and operates businesses in a variety of industries. LYNN SQUARE: Case Summary & 3 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Lynn Square, Ltd. P.O. Box 579 McKinney, TX 75070 Bankruptcy Case No.: 11-43045 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Debtor's Counsel: Christopher J. Moser, Esq. QUILLING, SELANDER, CUMMISKEY & LOWNDS 2001 Bryan Street, Suite 1800 Dallas, TX 75201-3005 Tel: (214) 871-2100 E-mail: cmoser@qsclpc.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's three largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txeb11-43045.pdf The petition was signed by David D. Blaylock, manager of general partner, Lynn Square GP, LLP. M WAIKIKI: Section 341 Meeting Continues After Filing of Schedules ------------------------------------------------------------------ The U.S. Trustee for Region 15 has rescheduled the meeting of creditors in Chapter 11 case of M Waikiki LLC from Oct. 3, 2011, to Nov. 1, 2011, at 2:00 p.m. The meeting will be held at the U.S. Trustee Hearing Room, 1132 Bishop Street, Suite 606, Honolulu, Hawaii. The U.S. Trustee explained that the Debtor's Bankruptcy schedules, statement of financial affairs and related documents are due by Oct. 12, and by the extension, the creditors to review of documents filed. About M Waikiki M Waikiki owns the Modern Honolulu, a world-class, luxury hotel property located close to Waikiki Beach in Hawaii. The hotel is being managed by Modern Management Services LLC, an affiliate of Aqua Hotels and Resorts. M Waikiki is a Hawaii limited liability company with its principal place of business located in San Diego, California. It is a special purpose entity, having roughly 75 indirect investors, which was formed to acquire the Hotel. The Company filed for Chapter 11 protection (Bankr. D. Hawaii Case No. 11-02371) on Aug. 31, 2011. Judge Robert J. Faris presides over the case. Patrick J. Neligan, Esq., and James P. Muenker, Esq., at Neligan Foley, LLP, in Dallas; and Simon Klevansky, Esq., Alika L. Piper, Esq., and Nicole D. Stucki, Esq., at Klevansky Piper, LLP, in Honolulu, Hawaii, represent the Debtor. The Debtor estimated $100 million to $500 million in both assets and debts. Modern Management is represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC. Marriott Hotel Services, which used to provide management services, is represented by Susan Tius, Esq., at Rush Moore LLP LLP, and Carren B. Shulman, Esq., at Sheppard Mullin Richter & Hampton LLP. The Official Committee of Unsecured Creditors retained Wagner Choi & Verbrugge as its counsel, and Young Conaway Stargatt & Taylor, LLP as special counsel. Tiffany L. Carrol, the acting United States Trustee for Southern California, Hawaii, Guam, and Northern Mariana Islands, pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed five unsecured creditors to serve on the Official Committee of Unsecured Creditors of M Waikiki LLC. M WAIKIKI: Court Approves Neligan Foley as Counsel -------------------------------------------------- The U.S. Bankruptcy Court for the District of Hawaii authorized M Waikiki LLC to employ Neligan Foley LLP as counsel. According to the Troubled Company Reporter on Sept. 26, 2011, Patrick J. Neligan, Jr., a partner at Neligan Foley, tells the Court the prior to the Petition Date, Neligan Foley received $339,686 from the Debtor to represent the Debtor in preparation for and in the Chapter 11 proceeding. Neligan Foley applied $14,709 to prepetition fees and expenses and forwarded $100,000 of the funds to Klevansky Piper LLP as retainer to applied to postpetition fees and expenses as approved by the Court. The hourly rates of Neligan Foley's personnel are: Partners $395 - $550 Paralegals and Associates $130 - $275 Mr. Neligan assured the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About M Waikiki M Waikiki owns the Modern Honolulu, a world-class, luxury hotel property located close to Waikiki Beach in Hawaii. The hotel is being managed by Modern Management Services LLC, an affiliate of Aqua Hotels and Resorts. M Waikiki is a Hawaii limited liability company with its principal place of business located in San Diego, California. It is a special purpose entity, having roughly 75 indirect investors, which was formed to acquire the Hotel. The Company filed for Chapter 11 protection (Bankr. D. Hawaii Case No. 11-02371) on Aug. 31, 2011. Judge Robert J. Faris presides over the case. Patrick J. Neligan, Esq., at Neligan Foley LLP, and Simon Klevansky, Esq., at Klevansky Piper, LLP, represent the Debtor. The Debtor estimated $100 million to $500 million in both assets and debts. Modern Management is represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC. Marriott Hotel Services, which used to provide management services, is represented by Susan Tius, Esq., at Rush Moore LLP LLP, and Carren B. Shulman, Esq., at Sheppard Mullin Richter & Hampton LLP. METROPARK USA: Seeks Stay of Bench Ruling on Cash Collateral Use ---------------------------------------------------------------- Bricoleur Capital Partners, LP, as second lien agent on behalf of itself and Cynthia T. Harris, Jon E. Bortz, Ellen E. Bortz, Jay A. Johnson, Robert M. Poole, Orval D. Madden as Trustee of the Madden Family Trust UTD 3/27/98 as amended, and LeAnn Madden as Trustee of the Madden Family Trust UTD 3/27/98 as amended, asks the U.S. Bankruptcy Court for the Southern District of New York to stay and rehear its Aug. 31, 2011 bench ruling (i) allowing Metropark USA, Inc.'s continued use of cash collateral, and (ii) sustaining the late-filed limited objection of the Official Committee of Unsecured Creditors to the Debtor's use of cash collateral. As of the Petition Date, the Debtor owed the Second Lien Lenders approximately $825,000 secured by security interests in, and liens on substantially all of the personal property of the Debtor, which liens are expressly subordinated to the security interests of the Prepetition Secured Parties pursuant to a Security Agreement dated March 21, 2011. The obligation to the Senior Secured Parties, owed approximately $2,555,353 as of the Petition Date, has just recently been paid. As a result, the Second Lien Lenders now hold the first priority lien on the Collateral, including cash collateral. On June 27, 2011, the Bankruptcy Court entered its Fourth Interim Agreed Order authorizing the limited use of cash collateral. The authorization to use cash collateral under the Order expired on Aug. 31, 2011. On Aug. 25, 2011, the Debtor filed a hearing agenda regarding a hearing before the Court on Aug. 29, 2011 (the Fifth Cash Collateral Hearing?) regarding the Debtor's continued use of cash collateral and the entry of a fifth interim cash collateral order, which indicated that no opposition has been filed regarding either the Debtor's continued use of cash collateral, or, importantly, the Revised Budget. On Aug. 26, 2011, the Debtor filed a notice of adjournment regarding the Fifth Cash Collateral Hearing, from Aug. 29, 2011, to Aug. 31, 2011. During the evening of Aug. 30, 2011, -- approximately 14 hours before the Fifth Cash Collateral Hearing, and with disregard for the requirements of Local Bankruptcy Rule 9006-1(b) and the fact that the Committee had notice of the Amended Budget 25 days beforehand -- the Committee filed its limited opposition to the Debtor's interim use of cash collateral. The Committee asserted that the Revised Budget violates Local Bankruptcy Rule 4001-2(a)(9) and 4001-2(h) due to its exclusion of the Committee. The Revised Budget, filed by Debtor, on Aug. 5, 2011, reflected no amount for the Committee, as the Committee has not agreed to any reduction in their fees and the Agent and the Committee have yet to reach an agreement to resolve the Committee's threatened litigation. Fees of counsel for the Debtor and the Debtor's financial advisor, who agreed to a 20% reduction of their fees, were included in the revised budget. Notwithstanding the fact that the objection was untimely and no representative of the Agent or the Second Lien Lenders was present at the Fifth Cash Collateral Hearing, the Court sustained the objection and directed that all professional fees of the Debtor's estate be paid in full. As a result of this fundamental change to the agreed terms for the continued use of cash collateral between the Debtor and the Agent, the Agent has withdrawn its consent to the Debtor's continued use of cash collateral. In support of its motion for rehearing, the Agent and the Second Lien Lenders state: -- The Court cannot authorize the Debtor's continued use of cash collateral without providing the Agent and Second Lien Lenders with adequate protection. -- The Committee induced the Court -- likely unintentionally -- into considering its late-filed objection, which resulted in a material change to the terms agreed upon between the Debtor resulting in the consensual use of cash collateral, without providing any meaningful notice of the objection to any of the parties, least of all the Agent or the Second Lien Lenders. -- The Agent and Second Lien Lenders should not be prejudiced by material changes to the circumstances underlying their agreements due to late-filed objections by parties such as the Committee who have more than sufficient notice that their rights may be affected by those agreements. To allow the Court's Aug. 31, 2011 bench ruling to stand and the proposed fifth interim cash collateral order to take effect would render those notice requirements and due process meaningless and clearly violatge the requirements of Section 363(e) of the Bankruptcy Code. About Metropark USA Metropark USA, Inc. -- http://www.metroparkusa.com/-- is a Los Angeles retail chain with 70 stores in 21 states. Metropark was founded in 2004 to capitalize on the large Gen Y segment (the 25- 35 year old customer) in demand for fashion-forward apparel and accessories. Its headquarters, distribution centers, and e- commerce site are located in Los Angeles, California. Metropark filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 11-22866) on April 26, 2011. Cathy Hershcopf, Esq., and Jeffrey L. Cohen, Esq., at Cooley LLP, in New York, N.Y., serve as the Debtor's bankruptcy counsel. CRG Partners Group, LLC, is the Debtor's financial advisor. The Debtor also tapped Great American Group Real Estate, LLC doing business as GA Keen Realty Advisors as special real estate advisor. The Debtor disclosed total assets of $28,933,805 and total debts of $28,697,006 as of April 2, 2011. Ronald A. Clifford, Esq., at Blakeley & Blakeley LLP, in Irvine, Calif., represents the Official Committee of Unsecured Creditors. Sandra E. Mayerson, Esq., and Peter A. Zisser, Esq. at Squire, Sanders & Dempsey (US) LLP, in New York, N.Y., represent Bricoleur Capital Partners L.P. as agent on behalf of itself and certain Second Lien Lenders. MODA HOSPITALITY: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Moda Hospitality SPE, LLC 500 North State College Boulevard Suite 1270 Orange, CA 92868 Bankruptcy Case No.: 11-78794 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: William A. Rountree, Esq. MACEY, WILENSKY, KESSLER & HENNINGS LLC Suite 2700 230 Peachtree Street, NW Atlanta, GA 30303-1561 Tel: (404) 584-1200 Fax: (404) 681-4355 E-mail: mharris@maceywilensky.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ganb11-78794.pdf The petition was signed by Hitesh Bhakta, corporate designee. MORNINGSIDE HEIGHTS: Terrace in the Sky Restaurant Closes Doors --------------------------------------------------------------- Abby Mitchell at Columbia Spectator reports that facilities spokesperson Dan Held confirmed on Oct. 3, 2011, that Terrace in the Sky has finally shut its doors, and is no longer operating from 119th Street and Morningside Drive. According to the report, the move follows months of legal woes for the restaurant. The Morningside Heights Restaurant Corporation, which operates the restaurant, filed for Chapter 11 bankruptcy in March, citing the general decline in the restaurant business from the economic crisis. Ms. Mitchell, citing court documents submitted to the New York Bankruptcy Court, says the restaurant owes the University $87,000, and the University Trustees sued the restaurant for failure to pay rent. Under the Chapter 11 reorganization plan, the restaurant was able to stay open. But in May, the trustees filed a motion to force the restaurant to vacate the property, claiming that Terrace in the Sky was occupying "valuable commercial space," adding that it was "unfair and prejudicial . . . for the debtor to continue to occupy the premises and conduct its popular restaurant and catering business without paying rent." Morningside Heights Restaurant Corp., doing business as Terrace in the Sky, filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 11-10731) in Manhattan on Feb. 22, 2011. The Debtor is represented by Lawrence F. Morrison, Esq. The Debtor estimated assets at up to $50,000 and debts of up to $500,000 as of the Chapter 11 filing. MSR RESORT: Court Extends Plan Filing Deadline to Oct. 14 --------------------------------------------------------- The Hon. Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York extended the exclusive periods of MSR Resort Golf Course LLC and its debtor-affiliates to file a Chapter 11 plan until Oct. 14, 2011, and solicit acceptances of that plan until Dec. 13, 2011. About MSR Resort MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc., owns a portfolio of eight luxury hotels with over 5,500 guest rooms, including the Arizona Biltmore Resort & Spa in Phoenix, the Ritz-Carlton in Orlando, Fla., and Hawaii's Grand Wailea Resort Hotel & Spa in Maui. On Jan. 28, 2011, CNL-AB LLC acquired the equity interests in the portfolio through a foreclosure proceeding. CNL-AB LLC is a joint venture consisting of affiliates of Paulson & Co. Inc., a joint venture affiliated with Winthrop Realty Trust, and affiliates of Capital Trust, Inc. Morgan Stanley's CNL Hotels & Resorts Inc. owned the resorts before the Jan. 28 foreclosure. Following the acquisition, five of the resorts with mortgage debt scheduled to mature on Feb. 1, 2011, were sent to Chapter 11 by the Paulson and Winthrop joint venture affiliates. MSR Resort Golf Course LLC and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan on Feb. 1. The resorts subject to the filings are Grand Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta Resort and Club and PGA West, Doral Golf Resort and Spa, and Claremont Resort and Spa. James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O. Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The five resorts had $2.2 billion in assets and $1.9 billion in debt as of Nov. 30, 2010, according to court filings. In its schedules, debtor MSR Resort disclosed $59,399,666 in total assets and $1,013,213,968 in total liabilities. NEWPAGE CORP: Receives Final Approval for $600-Mil. Financing ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that NewPage Corp. prevailed over most objections from the official creditors' committee and won agreement from the bankruptcy judge this week on final approval for $600 million in secured financing. According to the report, the Committee didn't want liens placed on the Company's few unencumbered assets. During the hearing, U.S. Bankruptcy Judge Kevin Gross complimented the company and creditors for cooperating toward the goal of keeping the company operating. Judge Gross said he is committed to helping find a way to save 6,000 manufacturing jobs. The DIP Financing As reported in Troubled Company Reporter on Sept. 26, 2011, the $600 million postpetition financing is being provided by JPMorgan Chase Bank, N.A., Barclays Bank PLC, Wells Fargo Capital Finance, LLC, and any future syndicate of financial institutions. The DIP Facility consists of (i) a $350 million superpriority senior secured DIP revolving credit facility, and (ii) a $250 million superpriority senior secured term loan facility. The Debtors told the Court that they intend to preserve and enhance their business as a going concern through the use of cash collateral and a postpetition credit facility consisting of (i) a revolver, and (ii) a term loan. The revolver is a $350 million superpriority senior secured DIP revolving credit facility. The term loan is a $250 million superpriority senior secured term loan facility. The DIP Credit Facility and use of Cash Collateral will provide the Debtors ample liquidity to fund their operations, capital expenditures, and corporate overhead during the course of their Chapter 11 cases, Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware -- ljones@pszjlaw.com -- asserted. About NewPage Corporation Headquartered in Miamisburg, Ohio, NewPage Corporation is the leading producer of printing and specialty papers in North America, based on production capacity, with $3.6 billion in net sales for the year ended December 31, 2010. The company's product portfolio is the broadest in North America and includes coated freesheet, coated groundwood, supercalendered, newsprint and specialty papers. These papers are used for corporate collateral, commercial printing, magazines, catalogs, books, coupons, inserts, newspapers, packaging applications and direct mail advertising. NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada. These mills have a total annual production capacity of approximately 4.1 million tons of paper, including approximately 2.9 million tons of coated paper, approximately 1.0 million tons of uncoated paper and approximately 200,000 tons of specialty paper. NewPage Corporation, along with affiliates, filed Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12804) on Sept. 7, 2011. Martin J. Bienenstock, Esq., Judy G.Z. Liu, Esq., and Philip M. Abelson, Esq., Dewey & Leboeuf LLP, in New York, serve as counsel. Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serves as co-counsel. Lazard Freres & Co. LLC is the investment banker, and FTI Consulting Inc. is the financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. In its balance sheet, the Debtors disclosed $3.4 billion in assets and $4.2 billion in total liabilities as of June 30, 2011. Attorneys at Young Conaway Stargatt & Taylor, LLP, and Paul, Hastings, Janofsky & Walker LLP, represent the Official Committee of Unsecured Creditors. NORTH COVE: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: North Cove Adventures, LLC a Utah limited liability company P.O. Box 33497 Juneau, AK 99803 Bankruptcy Case No.: 11-34304 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: Joel T. Marker Debtor's Counsel: Anna W. Drake, Esq. ANNA W. DRAKE, P.C. 175 South Main Street, Suite 300 Salt Lake City, UT 84111 Tel: (801) 328-9792 Fax: (801) 413-1620 E-mail: annadrake@att.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Scott L. Jorgensen, manager. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Lone Eagle Resorts 11-34315 09/30/11 NUMBER ONE: Case Summary & 5 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Number One Eastchase Ltd aka Woods of East Chase East Chase Gen Par LLC 6036 Frontier Plano, TX 75023 Bankruptcy Case No.: 11-43023 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Debtor's Counsel: Mark A. Weisbart, Esq. THE LAW OFFICES OF MARK A. WEISBART 12770 Coit Road, Suite 541 Dallas, TX 75251 Tel: (972) 628-3694 Fax: (972) 628-3687 E-mail: weisbartm@earthlink.net Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's five largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txeb11-43023.pdf The petition was signed by Billy J. Roberts, member of East Chase Gen Par LLC. OLSEN AGRICULTURAL: Court Approves R.J. & L as Real Estate Broker ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Oregon authorized Olsen Agricultural Enterprises LLC and Oregon Limited Liability Company to employ R.J. & L. Enterprises Inc. dba Realty Marketing/Northwest as real estate broker. The firm will sell: a) the real property and improvements located in Linn County, Oregon, consisting of about 156.2 acres and commonly known as Koos Farm; b) the real property and improvements located in Linn County, Oregon, consisting of about 373.58 acres and commonly known as Koos Brownsville Farm; c) the unimproved residential development site located in Linn County, Oregon, consisting of about 20.88 acres and commonly referred to as the Brownsville development site; and d) the residential homesite located in the Puakea Bay Ranch subdivision in Hawi, Hawaii, consisting of three lots that total about 10 acres. The firm will get a commission fee of: -- 6% of the purchase price for Brownsville Development Site. -- 5% of the purchase price for Koos Farm. -- 7% for Hawaii to be split equally with affiliate broker. The Debtors assure the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Olsen Agricultural Enterprises Based in Monmouth, Oregon, Olsen Agricultural Enterprises LLC operates an agricultural enterprise on roughly 7,762 acres of owned and leased land located in Benton, Linn and Polk Counties. Its business is comprised principally of three divisions: (a) Olsen Seed Company, which produces and sells a variety of grass seed and grains on 5,934 acres; (b) Olsen Agriculture, which grows and sells peppermint, nursery stock, squash, hazelnuts and blueberries on 1,334 acres; and (c) Olsen Family Vineyards, which grows a variety of grapes on 494 acres and produces and sells quality wines under the "Viridian" label as well as private labels. Olsen Agricultural Enterprises is the surviving entity of a merger transaction that was consummated on June 1, 2011. In the merger transaction, Olsen Agricultural Company, Inc., an Oregon corporation, Jenks-Olsen Land Co., an Oregon general partnership, Olsen Vineyard Company, LLC, an Oregon limited liability company and The Olsen Farms Family Limited Partnership were merged with and into Olsen Agricultural Enterprises. Olsen Agricultural Enterprises filed for Chapter 11 bankrutpcy (Bankr. D. Ore. Case No. 11-62723) on June 1, 2011. Judge Frank R. Alley III presides over the case. Greene & Markley, P.C., acts as the Debtor's bankruptcy counsel. Clyde A. Hamstreet & Associates, LLC, serves as the Debtor's restructuring consultant and financial advisor. An official committee of unsecured creditors has been appointed in the case. In its petition, the Debtor estimated $10 million to $50 million in assets and debts. The petition was signed by Robin G. Olsen, operations director. For the fiscal year ended Dec. 31, 2010, OAC reported total revenues of $6,428,880 and a net loss of ($5,791,310). At the time of the merger, on a consolidated basis, the books and records of OAC, JOLC and OVC reflected assets totaling $29.8 million and liabilities totaling $37.2 million. The fair market value of the Debtor's assets, on a going concern basis, is roughly $50 million. PAUL BRENNEKE: Case Dismissal, Conversion Hearing Set for Oct. 26 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Oregon will convene a hearing on Oct. 26, 2011, at 1:30 p.m., to consider Robert D. Miller Jr., the Region 18 U.S. Trustee's motion to dismiss or convert the Chapter 11 case of Paul Brenneke Qualified Personal Residence Trust UDT. The U.S. Trustee is represented by: Carla G. McClurg, Esq. Office of the U.S. Trustee 620 SW Main Street, Suite 213 Portland, OR 97205 Tel: (503) 326-7659 Z&A Irrevocable Trust UDT, Elene Dunavan, Jones Dave D&J Remodeling, and Victor Le Nettoyeur LLC filed for Involuntary Chapter 11 protection for Portland, Oregon-based Paul Brenneke Qualified Personal Residence Trust UDT (Bankr. D. Ore. Case No. 11-31975) on March 14, 2011. Judge Trish M. Brown presides over the case. The petitioners are represented by Robert S. Simon, Esq. at Robert S. Simon P.C. The U.S. Trustee for Region 18 notified the U.S. Bankruptcy Court for the District of Oregon that he is unable to appoint an official committee of unsecured creditors in the Chapter 11 case of Paul Brenneke Qualified Personal Residence Trust UDT. The U.S. Trustee explains that he has not received a sufficient number of creditors willing to serve on a committee. PDSS PARTNERS: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: PDSS Partners, LP 616 Roanoke Dr. Allen, TX 75013 Bankruptcy Case No.: 11-43039 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Debtor's Counsel: Arthur I. Ungerman, Esq. 8140 Walnut Hill Lane, Suite 301 Dallas, TX 75231 Tel: (972) 239-9055 Fax: (972) 239-9886 E-mail: arthur@arthurungerman.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Pankerj Pragji, limited partner. PENINSULA HOSPITAL: Hires Alvarez & Marsal as Financial Advisors ---------------------------------------------------------------- Peninsula Hospital Center and Peninsula General Nursing Home Corp., doing business as Peninsula Center for Extended Care & Rehabilitation, seek authority from the U.S. Bankruptcy Court for the Eastern District of New York to employ Alvarez & Marsal Healthcare Industry Group, LLC, together with employees of its affiliates, its wholly owned subsidiaries and independent contractors, to serve as the Debtors' financial advisors, nunc pro tunc to the Petition Date. Among other things, A&M will provide assistance to the Debtors with respect to management of the overall restructuring process, the development of ongoing business and financial plans, and supporting restructuring negotiations among the Debtors, their advisors and their creditors with respect to an overall exit strategy for their Chapter 11 cases. A&M will also support the Debtors' financial function, assist in developing and implementing cash management planning and processes and assist in coordinating and providing administrative support for the development of the Debtors' plan of reorganization/liquidation, among other services. In accordance with the terms of the parties' engagement letter, A&M will be paid for its professionals' services at $160,000 per month. A&M will also be reimbursed for the reasonable out-of- pocket expenses incurred in connection with its engagement. As a material part of the consideration for which the A&M Professionals have agreed to provide services, the Debtors have agreed to certain indemnification provisions in the Engagement Letter. A&M received $125,000 as a retainer in connection with preparing for and conducting the filing of the Debtors' Chapter 11 cases. In the 90 days prior to the bankruptcy filing, A&M received retainers from and on behalf of the Debtors and payments totaling $175,000 in the aggregate for services performed or to be performed for the Debtors. The payments were received as follows: $50,000 directly from the Debtors and $125,000 on behalf of the Debtors from Nutovic & Associates, Counsel to Revival Funding Co., LLC. A&M has applied these funds to amounts due for services rendered and expenses incurred prior to the Petition Date. Ronald M. Winters, managing director of A&M, assures the Court that A&M is a "disinterested person" as defined by Section 101(14) of the Bankruptcy Code. Wayne S. Dodakian, Vinod Sinha, and Shannon Gerardi filed an involuntary Chapter 11 bankruptcy protection against Peninsula Hospital Center in the U.S. Bankruptcy Court for the Eastern District of New York (Case No. 11-47056) on Aug. 16, 2011. Judge Elizabeth S. Stong presides over the case. Marilyn Cowhey Macron, Esq., Macron & Cowhey, represents the petitioners. PENINSULA HOSPITAL: Seeks to Hire Abrams Fensterman as Counsel -------------------------------------------------------------- Peninsula Hospital Center and Peninsula General Nursing Home Corp., doing business as Peninsula Center for Extended Care & Rehabilitation, ask permission from the U.S. Bankruptcy Court for the Eastern District of New York to employ Abrams Fensterman et al. as their attorneys, nunc pro tunc to the Petition Date. As counsel, Abrams Fensterman's services will include assisting, advising and representing the Debtors with respect to these matters: (a) The administration of these cases and the exercise of oversight with respect to the Debtors' affairs; (b) The preparation on behalf of the Debtors of necessary applications, motions, memoranda, orders, reports and other legal pleadings; (c) Appearances in Court and at various meetings to represent the interests of the Debtors; (d) Negotiating with the Debtors' secured lenders, as well as any creditors' committee appointed in the cases, other creditors, and third parties, for the benefit of the Debtors' estates; and (e) Communication with creditors and others as the Debtors may consider desirable or necessary. The Debtors will compensate Abrams Fensterman in accordance with its standard hourly billing rates, and will reimburse the Firm's expenses incurred on behalf of the Debtors. The hourly rate for various attorneys and paraprofessionals, who will be rendering services on behalf of the Debtors during the pendency of the cases, ranges from $90 to $600 per hour. Hourly rates for (i) attorneys currently range from $250 to $600, and (ii) paraprofessionals range from $90 to $225. Deborah J. Piazza, a partner at Abrams Fensterman, attests that the Firm is a "disinterested person" as defined by Section 101(14) of the Bankruptcy Code. Wayne S. Dodakian, Vinod Sinha, and Shannon Gerardi filed an involuntary Chapter 11 bankruptcy protection against Peninsula Hospital Center in the U.S. Bankruptcy Court for the Eastern District of New York (Case No. 11-47056) on Aug. 16, 2011. Judge Elizabeth S. Stong presides over the case. Marilyn Cowhey Macron, Esq., Macron & Cowhey, represents the petitioners. POLYONE CORPORATION: Moody's Affirms 'Ba2' Corp. Family Rating -------------------------------------------------------------- Moody's Investors Service affirmed the long term debt ratings (Corporate Family Rating of Ba2 (CFR)) of PolyOne Corporation (PolyOne). The affirmation (see list below) reflects the proposed friendly acquisition agreement to acquire ColorMatrix Group, Inc. (ColorMatrix), a leading global innovator in liquid colorants, additives and fluoropolymers for a purchase price of $486 million. ColorMatrix achieved sales and EBITDA of $196.8 million and $43.6 million respectively for the 12 months ended June 30, 2011. This puts the EBITDA multiple for the purchase price at approximately 11 times not including any potential synergies. PolyOne intends to finance the purchase price of $486 million, which includes transaction tax benefits of $10 million, with a combination of cash on hand and the addition of approximately $300 million of long term debt. Proforma for the acquisition Debt to EBITDA for the LTM period ending June 30, 2011 would be 3.2X up from 2.6X for PolyOne on a standalone basis (excluding the EBITDA from Sunbelt). A 3.2X leverage ratio maps to a Ba1 credit metric per Moody's chemical methodology. The acquisition is subject to regulatory approvals and is expected to close late in 2011. Depending on the terms of the proposed acquisition related debt the existing ratings on PolyOne's public debt may be lowered if viewed as subordinate. RATINGS RATIONALE PolyOne's Ba2 CFR reflects the prospect of a continued sustainable operating income generated by its Global Specialty Engineered Materials and Performance Products and Solutions segments as well as the Distribution segment over the next several years. PolyOne's performance has been aided by successful restructuring programs, economic recovery and demand increases, and product mix improvements. Moody's constructive view of PolyOne's performance is supported by the significant gains demonstrated since mid-2009. Moody's expects that PolyOne will generate free cash flow in 2011 and 2012. PolyOne's good liquidity was boosted by cash from earnings and the sale of its SunBelt joint venture, which brought the cash balance to $417 million as of June 30, 2011. However, some of PolyOne's cash will be utilized to execute the October 3, 2011 announced acquisition of ColorMatrix - a transaction which is supportive of PolyOne's global expansion strategy and focus on value-added product initiatives. Ratings Affirmed: Issuer: PolyOne Corporation Corporate Family Rating Ba2 Probability of Default Rating Ba2 8.75% Senior Notes due 2012 Ba2 LGD4, 57% 7.5% Debentures due 2015 Ba2 LGD4, 57% 7.375% Senior Notes due 2020 Ba2 LGD4, 57% Senior Unsecured Shelf (P)Ba2 Preferred Shelf (P)B1 Speculative Grade Liquidity Rating at SGL-2 Outlook Stable PolyOne's Speculative Grade Liquidity Rating of SGL-2 is a result of their good liquidity position which includes a significant cash balance, no significant near-term maturities, and no covenant concerns. There is limited upside to the ratings at this time. Should PolyOne achieve sustainable EBITDA margins above 10%, maintain Retained Cash Flow / Debt of above 25%, and reliably achieve Debt/EBITDA of less than 3.0X on an adjusted basis, Moody's could consider the appropriateness of a higher rating. Moody's could reassess the appropriateness of the rating and outlook if annual EBITDA falls below $100 million such that Debt / EBITDA rises above 4.5X on a sustainable basis or if the company's excess liquidity declines below $50 million. Moody's assessment would also consider the impact of anticipated acquisitions as well as further dividend and share repurchase programs. The principal methodology used in rating PolyOne Corporation was the Global Chemical Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. PolyOne Corporation, (PolyOne) headquartered in Avon Lake, Ohio, is a leading global provider of specialized polymer materials, services and solutions with revenues of $2.8 billion for the LTM ending June 30, 2011. PONCE DE LEON: Hearing Today on Further Cash Use Access ------------------------------------------------------- Judge Enrique S. Lamoutte of the U.S. Bankruptcy Court for the District of Puerto Rico granted approval to Ponce De Leon 1403, Inc., to use the cash collateral of Banco Popular de Puerto Rico on an interim basis. The Debtor was authorized to use Lender's cash collateral only for operating expenses provided for in the Budget approved by Lender, pending a final hearing. The Debtor has prepared a budget reflecting anticipated operating expenses for the Debtor in the amount of $26,750 for 15 days. Prior to the Petition Date, Banco Popular de Puerto Rico made certain loans and extended certain financial accommodations to the Debtor. As of the Petition Date, $14.6 Million was outstanding under the prepetition debt. To secure the Prepetition Debt, the Debtor granted to Lender liens on and security interests in the Debtor's real property and accounts receivable. All of the Debtor's cash represents either proceeds of financing provided by Lender or proceeds of prepetition collateral. Accordingly, all of the Debtor's cash is Lender's cash collateral. Carmen D. Conde Torres, Esq., at C. Conde & Associates, tells the Court that an immediate and critical need exists for the Debtor to obtain access to funds in order to continue the operation of its business. Without these funds, the Debtor will not be able to pay its payroll and other operating expenses and obtain goods and services needed to carry on its business. As adequate protection for the use of its cash collateral, the Lender is granted valid, binding, enforceable and perfected liens on all property of the Debtor's estate to secure an amount of Prepetition Debt equal to any decrease in the value of Lender's interest in the Prepetition Collateral occurring subsequent to the Petition Date, including decreases resulting from the Debtor's use of cash collateral hereunder, depreciation, use, sale, loss, passage of time, decline in the market value of Prepetition Collateral or otherwise. A final hearing on the Motion is set for Oct. 7, 2011 at 9:30 A.M. About Ponce De Leon 1403 San Juan, P.R.-based Ponce De Leon 1403, Inc., developed, constructed, and operates the Metro Plaza Tower condominium and commercial property project in Santurce, Puerto Rico. The Metro Plaza Tower project consists of two 15-story towers atop a base structure that serves as a parking garage, common area, and retail space. Each tower houses 87 residential units. The base structure provides approximately 567 parking spaces and has approximately 14,000 square feet of commercial space available for lease. The common areas of the project include a swimming pool, a gym, gardens and a gazebo. Ponce De Leon 1403, Inc., disclosed assets between $10,000,001 to $50,000,000, and debts between $1,000,001 to $10,000,000. Ponce De Leon 1403, Inc., filed voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code (Bankr. Puerto Rico Case No. 11-07920) on Sept. 19, 2011. Carmen D. Conde Torres, Esq., at C. Conde & Associates, in San Juan, P.R., represents Ponce De Leon 1403. PONCE DE LEON: Meeting of Creditors Scheduled for Oct. 24 --------------------------------------------------------- The U.S. Trustee for Region 21 will convene a meeting of creditors in Ponce De Leon 1403 Inc's Chapter 11 case on Oct. 24, 2011, at 10:30 a.m. The meeting will be held at the 341 Meeting Room, Ochoa Building, 500 Tanca Street, First Floor, San Juan, Puerto Rico. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Individual or entities has until Jan. 22, 2012, to file proofs of claim against the Debtor. Government proofs of claim are due March 18, 2012. About Ponce De Leon 1403 San Juan, P.R.-based Ponce De Leon 1403, Inc., developed, constructed, and operates the Metro Plaza Tower condominium and commercial property project in Santurce, Puerto Rico. The Metro Plaza Tower project consists of two 15-story towers atop a base structure that serves as a parking garage, common area, and retail space. Each tower houses 87 residential units. The base structure provides approximately 567 parking spaces and has approximately 14,000 square feet of commercial space available for lease. The common areas of the project include a swimming pool, a gym, gardens and a gazebo. San Juan, Puerto Rico-based, Ponce De Leon 1403, Inc., filed for Chapter 11 protection (Bankr. D. P.R. Case No. 11-07920) on Sept. 19, 2011. The Debtor estimated assets and debts at $10 million to $50 million. The petition was signed by Ruben A. Jordan, president. The Debtor is represented by: Carmen D. Conde Torres, Esq. C. CONDE & ASSOCIATES 254 San Jose Street, 5th Floor San Juan, PR 00901-1523 Tel: (787) 729-2900 Fax: (787) 729-2203 E-mail: notices@condelaw.com PONCE DE LEON: Wants to Hire RSM ROC as Accountant -------------------------------------------------- Ponce De Leon 1403 Inc. asks the U.S. Bankruptcy Court for the District of Puerto Rico for permission to employ RSM ROC & Company as accountant. The firm will, among other things: a) prepare or review of bankruptcy court required monthly operating reports; b) reconcile proof of claims; c) prepare or review Debtor's projections; d) analyze profitability of the Debtor's operations; and e) assist in the development or review of plan of reorganization or disclosure statements. The firms professionals and their compensation rates: Partner $160-$300 Managers and Supervisors $100-$150 Semi-Seniors and Seniors $75-$80 The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Based in San Juan, Puerto Rico, Ponce De Leon 1403 Inc. filed for Chapter 11 protection on Sept. 19, 2011 (Bank. D. P.R. Case No. 11-07920). The Debtor estimated both assets and debts of between $10 million and $50 million. PONCE DE LEON: Wants to Hire Carmen Torres as Attorney ------------------------------------------------------ Ponce De Leon 1403 Inc. asks the U.S. Bankruptcy Court for the District of Puerto Rico for permission to employ the Law Firm of Carmen D. Conde Torres, Esq., as its attorney to advise the Debtor with respect to its duties, powers and responsibilities. Mr. Torres will charge $300 per hour for this engagement. The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. San Juan, P.R.-based Ponce De Leon 1403, Inc., developed, constructed, and operates the Metro Plaza Tower condominium and commercial property project in Santurce, Puerto Rico. The Metro Plaza Tower project consists of two 15-story towers atop a base structure that serves as a parking garage, common area, and retail space. Each tower houses 87 residential units. The base structure provides approximately 567 parking spaces and has approximately 14,000 square feet of commercial space available for lease. The common areas of the project include a swimming pool, a gym, gardens and a gazebo. Ponce De Leon 1403 Inc. filed for Chapter 11 protection (Bank. D. P.R. Case No. 11-07920) on Sept. 19, 2011. The Debtor estimated both assets and debts of between $10 million and $50 million. POWER RECEIVABLE: S&P Affirms 'BB+' Rating on Subordinate Notes --------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook to positive from stable on Power Receivable Finance LLC's (PRF) $432 million senior secured notes due in January 2012 ($35.8 million outstanding as of Aug. 30, 2011) and $22.2 million subordinated notes due in February 2012 ($7.8 million outstanding). "At the same time, we affirmed the 'BBB' rating on the senior secured notes and the 'BB+' rating on the subordinate notes," S&P related. "The outlook revision on PRF's senior and subordinate notes reflects the probability that the project will make its final debt payments in January and February 2012," said Standard & Poor's credit analyst Theodore Dewitt. The project will make the final debt service payments in the amount of $18.23 million on the first lien in January 2012 and $6.54 million on the second lien in February 2012. The project will receive payments of approximately $18.23 million for its last three power deliveries and has approximately $6.6 million of cash on hand, which it will use to make the final note payments. The project also has a six-month debt service reserve backed by a letter of credit with the Goldman Sachs Group Inc. (GSG; A/Negative/A-1), which wholly owns PRF. The positive outlook reflects the increased likelihood that the project will make its final debt payments in January and February 2012. The structure of the project has performed as expected and will likely earn sufficient cash flow to meet its final obligations. "PRF can also meet the final payment with its letter- of-credit-backed debt service reserve; however, we think that course of action is unlikely," S&P said. PREGIS CORP: S&P Puts B- Corp. Credit Rating on Watch Developing ---------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on Pregis Corp., including the 'B-' corporate credit rating, on CreditWatch with developing implications. "The CreditWatch listing follows Pregis Corp.'s announcement that it has agreed to divest its Hexacomb division, which produces paper-based packaging, to an affiliate of paper and packaging manufacturer Boise Inc. The agreement values the transaction at approximately $125 million. The transaction is the result of Pregis' ongoing internal review of its business portfolio, in an effort to optimize value and reduce leverage," said Standard & Poor's credit analyst Ket Gondha. "The developing implications of the listing indicate that we could raise, lower, or affirm the ratings depending on future developments including the details of the reorganization plan and use of funds," he added. Pregis, with annual sales of more than $900 million, was formed in October 2005, when equity sponsor AEA Investors LLC acquired substantially all of Pactiv Corp.'s North American and European protective and specialty packaging businesses. PURE BEAUTY: Returns to Chapter 11 in Delaware ---------------------------------------------- Pure Beauty Salons & Boutiques Inc. filed for bankruptcy (Bankr. D. Del. Case No. 11-13159) a year after having been sold out of Chapter 11. In the new Chapter 11 case, the proposal is for former owner Regis Corp. and an affiliate of a Luborsky family trust to purchase the business in exchange for $32.5 million in debt held by Regis and the assumption of liabilities. The deal is subject to higher and better offers at a court-sanctioned auction. The Debtor, which filed for bankruptcy with an affiliate, has 436 mall-based locations operating beauty salons and retailing hair- care products. Franchisees are operating additional 22 BeautyFirst and 7 Trade Secret stores. Trade names include Trade Secret, Beauty Express, BeautyFirst, PureBeauty, and Winston's Barber Shop. About 2,330 people are employed by the Debtor. The Debtor estimated assets and debts both at $10 million to $50 million. The Debtors currently owe $15 million to vendors and landlords. The two buyers were also involved in the prior Chapter 11 sale. Regis Corp., bought the stores through a credit bid of $32.5 million and the assumption of $13 million debt. An affiliate of a Luborsky family trust was also involved in the purchase. The prior case, In re Trade Secret Inc. (Bankr. D. Del. Case No. 10-1215) was dismissed after the sale was completed. CEO Brian Luborsky said in a court filing that many of the purchased stores have not performed as well as the Debtors' projected at the time they entered into the sale transaction. The Debtors projected EBIDTA of $6.7 million at the end of July 2011, but actual results for the first nine months post-closing yielded an EBITDA loss of $14.1 million. PURE BEAUTY: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Pure Beauty Salons & Boutiques, Inc. aka Trade Secret Beauty Express Winston's Barber Shop BeautyFirst PureBeauty 3762 14th Avenue, #200 Markham L3R 0G7 Canada Bankruptcy Case No.: 11-13159 Chapter 11 Petition Date: October 4, 2011 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Judge: Mary F. Walrath Debtor's Counsel: Andrew L. Magaziner, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP The Brandywine Building, 17th Floor 1000 N. West Street Wilmington, DE 19801 Tel: (302) 571-6600 E-mail: bankfilings@ycst.com - and ? Joseph M. Barry, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP The Brandywine Building, 17th Floor 1000 West Street Wilmington, DE 19801 Tel: (302) 571-6600 E-mail: bankfilings@ycst.com Debtor's Investment Banker: SSG Capital Advisors, LLC Debtor's Notice, Claims Solicitation, and Balloting Agent: EPIQ BANKRUPTCY SOLUTIONS Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Brian Luborsky, chief executive officer. Affiliate that simultaneously sought Chapter 11 protection: Debtor Case No. ------ -------- BeautyFirst Franchise Corp. 11-13160 Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ PREIT Services, LLC Litigation Claim $2,426,722 c/o Klehr Harrison Harvey Branzburg LLP 1835 Market Street, Suite 1400 Philadelphia, PA 19103 John Paul Mitchell Systems Trade $1,356,734 20705 Centre Pointe Park Santa Clarita, CA 91350 OPI Products, Inc. Trade $945,139 13034 Saticoy Street N. Hollywood, CA 91605 KPSS, Inc. Trade $430,904 981 Corporate Boulevard Linthicum Heights, MD 21090 Farouk Systems Trade $402,829 250 Pennbright, Suite 150 Houston, TX 77090 Kenra Laboratories, Inc. Trade $394,726 22 E. Washington Street, 5th Floor Indianapolis, IN 46204 Houston BW, Inc. et al. Litigation $371,000 12 Corporate Woods 10975 Benson, Suite 550 Overland Park, KS 66210-2008 Beautymax/FHI Heat, Inc. Trade $336,558 30575 Bainbridge Road, Suite 200 Solon, OH 44139 National City Commercial Capital Trade $316,926 Co. LLC 995 Dalton Avenue Cincinnati, OH 45203 Joico Laboratories Trade $299,500 300 Forge Road Geneva, NY 14456 Helen of Troy Corporation Trade $297,444 One Helen of Troy Plaza El Paso, TX 79912 Beautopia LLC Trade $283,844 3939 E. 46th Street Minneapolis, MN 55406 Tigi Linea Haircare Trade $253,632 1655 Waters Ridge Drive Lewisville, TX 75057 Macadamia Natural Oil LLC Trade $132,528 Epiq Bankruptcy Solutions, LLC Professional Fees $130,000 Sexy Hair Concepts, LLC Trade $124,288 Macerich ? Store No. 70025 ? Lease Obligation $111,682 Tysons Corner Staples Contract & Commercial, Trade $105,367 Inc. Athena Cosmetics Inc./Revitalash Trade $91,260 Federal Realty Invest Trust - Lease Obligation $91,152 Store No. 70053 ? Pike 7 Plaza QUALTEQ INC: Bank of America Seeks to Transfer Venue of Cases ------------------------------------------------------------- Bank of America, N.A. asks the U.S. Bankruptcy Court for the District of Delaware for authority to file under seal its motion to transfer venue of the Chapter 11 cases of QualTeq, Inc., d/b/a VCT New Jersey, Inc., et al. to the U.S. Bankruptcy Court for the Northern District of Illinois. Bank of America also asks the Court to direct that until further Court order, the Transfer Venue Motion will remain under seal and confidential, and will not be made available to anyone other than the Court and counsel to the Debtors. Bank of America has also filed a motion to lift the automatic stay for the limited purpose of permitting it to file a motion in the Northern District of Illinois to modify certain protective orders entered in litigation pending there so that, inter alia, the Transfer Venue Motion and any subsequent filings referring to the record in the Northern District may be filed in an unrestricted manner in this Court. According to Bank of America, filing the Transfer Venue Motion is necessary because disclosure of material subject to the Protective Order could be perceived as a breach. About QualTeq Inc. South Plainfield, New Jersey-based QualTeq, Inc., engages in the design, manufacture, and personalization of plastic cards in the United States. The company manufactures magnetic, contact, and dual interface smart cards. Qualteq Inc. and 17 affiliated companies filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12572) on Aug. 14, 2011. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, serve as local counsel to the Debtors. K&L Gates LLP is the general bankruptcy counsel. Scouler & Company is the restructuring advisors. QualTeq estimated assets of up to $50 million and debts of up to $100 million as of the Chapter 11 filing. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed four unsecured creditors to serve on the Official Committee of Unsecured Creditors of QualTeq, Inc. QUINCY MEDICAL: Court Sets Nov. 10 as Claims Bar Date ----------------------------------------------------- The Hon. Melvin S. Hoffman of the U.S. Bankruptcy Court for the District of Massachusetts set Nov. 10, 2011, as the deadline for creditors of Quincy Medical Center Inc. and its debtor-affiliates to file proofs of claim. Governmental units have until Dec. 28, 2011, to file their claims. About Quincy Medical Quincy Medical Center is a 196-bed, nonprofit hospital in Quincy, Massachusetts. Quincy Medical Center, Inc. together with two affiliates, sought Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16394) on July 1, 2011. John T. Morrier, Esq., at Casner & Edwards, LLP, in Boston, serves as counsel to the Debtors. Navigant Capital Advisor LLC and Navigant Consulting Inc. serve as financial advisors. Epiq Bankruptcy Solutions LLC is the claims, noticing, and balloting agent. Quincy disclosed assets of $73 million and liabilities of $79.4 million. Debt includes $56.4 million owing on secured bonds issued through a state health-care finance agency. There is another $2.5 million secured obligation owing to Boston Medical Center Corp. Accrued liabilities are $18.2 million. On July 12, 2011, the U.S. Trustee for the District of Massachusetts appointed the Official Committee of Unsecured Creditors. Counsel to the Creditors' Committee is Jeffrey D. Sternklar, Esq., at Duane Morris LLP, in Boston, Massachusetts. Deloitte Financial Advisory Services LLC is the financial advisor to the Creditors' Committee. QWEST COMMUNICATIONS: Sells $950 Million of 6.75% Notes Due 2021 ---------------------------------------------------------------- Qwest Corporation, an indirect wholly owned subsidiary of both CenturyLink, Inc., and CenturyLink's wholly owned subsidiary, Qwest Communications International Inc., publicly sold $950,000,000 aggregate principal amount of its 6.75% Notes due 2021. The public offering price of the Notes was 98.181% of the principal amount. After deducting the underwriting discount and QC's estimated expenses, QC expects to receive approximately $926 million of net proceeds from the sale of the Notes. QC expects to use the net proceeds from this offering, together with the $557 million of net proceeds it received on Sept. 21, 2011, in connection with the sale of its 7.50% Notes due 2051 and cash on hand, to redeem in October 2011 the $1.5 billion aggregate principal amount of QC's outstanding 8.875% Notes due March 15, 2012, and to pay all related fees and expenses. QC sold the Notes pursuant to an underwriting agreement dated Sept. 27, 2011, among QC and the underwriters, and a related price determination agreement dated Sept. 27, 2011, among the same parties. The Notes have been registered under the Securities Act of 1933, as amended, pursuant to an automatic shelf registration statement on Form S-3, filed by QCII, QC, and certain of their affiliates with the Securities and Exchange Commission on Dec. 12, 2008, as supplemented by a prospectus supplement dated Sept. 27, 2011. QC issued the Notes pursuant to an indenture dated as of Oct. 15, 1999, between QC and Bank of New York Trust Company, National Association, as amended and supplemented, including by the Ninth Supplemental Indenture between QC and U.S. Bank National Association, as trustee, dated as of Oct. 4, 2011. QC will pay interest on the Notes semi-annually in arrears on June 1 and December 1 of each year, beginning June 1, 2012. QC may redeem the Notes, at any time in whole or from time to time in part, at its option, at a redemption price equal to the greater of (i) 100% of the principal amount of the Notes to be redeemed or (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed, discounted to the date of redemption on a semi-annual basis at the then current Treasury Rate applicable to the Notes plus 50 basis points. The Notes are QC's senior unsecured obligations and will rank senior to any of its future subordinated debt and rank equally in right of payment with all of its existing and future unsecured and unsubordinated debt. About Qwest Communications Based in Denver, Colorado, Qwest Communications (NYSE: Q) -- http://www.qwest.com/-- offers residential customers a new generation of fiber-optic Internet service, high-speed Internet solutions, as well as digital home phone, wireless service available through Verizon Wireless and DIRECTV services. Qwest is also the choice of 95% of Fortune 500 companies, offering a full suite of network, data and voice services for small businesses, large businesses, government agencies and wholesale customers. Additionally, Qwest participates in Networx, the largest communications services contract in the world, and is recognized as a leader in the network services market by leading technology industry analyst firms. The Company's balance sheet at June 30, 2011, showed $31.28 billion in total assets, $19.06 billion in total liabilities and $12.22 billion in total stockholders' equity. * * * Qwest carries a 'Ba1' corporate family and probability of default ratings from Moody's and has 'BB' issuer credit ratings from Standard & Poor's. "Our high debt levels pose risks to our viability and may make us more vulnerable to adverse economic and competitive conditions, as well as other adverse developments," the Company said in its Form 10-K for the year ended Dec. 31, 2009. At Dec. 31, the Company's consolidated debt was approximately $14.2 billion. Approximately $5.8 billion of its debt obligations come due over the next three years. This amount includes $1.265 billion of our 3.50% Convertible Senior Notes due 2025, which it may elect to redeem at any time on or after Nov. 20, 2010 and holders may require the Company to repurchase for cash on Nov. 15, 2010. Fitch Ratings is maintaining the Rating Watch Positive on the 'BB' Issuer Default Rating assigned to Qwest Communications International, Inc. and its subsidiaries. Concurrently, Fitch has affirmed the 'BBB-' issue rating assigned to Qwest's $1.035 billion senior secured credit facility and the senior unsecured debt issued by Qwest Corporation. Approximately $13.1 billion of debt outstanding as of June 30, 2010, including $7.9 billion of debt outstanding at QC, is affected by Fitch's action. RADIATION THERAPY: Moody's Says B2 CFR Unaffected by Amendments --------------------------------------------------------------- Moody's Investors Service said that the B2 corporate family and probability of default ratings and negative outlook of Radiation Therapy Services, Inc. ("RTS") are unaffected by recent credit agreement amendments. Further, the Ba2 ratings on the term loan and revolving credit facility as well as the B3 rating on the Senior Subordinated Notes are unchanged. RTS entered into the amendments on September 29, 2011 and September 30, 2011. The amendments include an increase in RTS' revolving credit facility's total capacity to $125 million from $75 million. Other changes in the amendment include, but are not limited to, modification to permitted investment baskets, permitted indebtedness basket, and 50 basis point increase in interest rate. The increase in interest rate to LIBOR+475 basis points from LIBOR + 425 basis points is anticipated to increase interest expense approximately $4 million or 5-6%. Radiation Therapy Services 's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Radiation Therapy Services's core industry and believes Radiation Therapy Services's ratings are comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Radiation Therapy Services owns and operates radiation treatment facilities in the US and Latin America. The company's revenues for the last twelve months ended June 30, 2011 were approximately $593 million. REAL MEX: Moody's Cuts Probability of Default Rating to 'D' ----------------------------------------------------------- Moody's Investors Service downgraded Real Mex Restaurants, Inc. ("Real Mex")'s Probability of Default Rating to D from Ca. The downgrade was prompted by the company's October 4, 2011 announcement that it filed for Chapter 11 bankruptcy protection. These ratings were downgraded and will be withdrawn: Probability of Default Rating downgraded to D from Ca $130 million 2nd lien senior secured notes due 2013 to Caa3 (LGD 3, 30%) from Caa2 (LGD 2, 27%) The following ratings will be withdrawn: Corporate Family Rating at Ca Speculative Grade Liquidity rating at SGL - 4 RATINGS RATIONALE Subsequent to the actions, Moody's will withdraw the ratings because Real Mex has entered bankruptcy. Please refer to Moody's Withdrawal Policy on moodys.com The principal methodology used in rating Real Mex Restaurants, Inc. was the Global Restaurant Industry published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Real Mex Restaurants, Inc., headquartered in Cypress, California, is a leading Mexican-themed restaurant chain operator that owns, operates and franchises casual dining restaurants primarily under the El Torito, Chevys Fresh Mex and Acapulco Mexican Restaurant concepts. Total revenues for twelve months ended June 30, 2011 were approximately $471 million. REGAL PLAZA: Court Dismisses Chapter 11 Cases --------------------------------------------- The Honorable Mike K. Nakagawa entered a final order dismissing the Chapter 11 case of Regal Plaza, LLC, with prejudice. The Court, which previously entered a Conditional Order of Dismissal of Chapter 11 cases, has been informed by Lenard E. Schwartzer, Esq., of the law firm Schwartzer & McPherson Law Firm, on behalf of Regal Plaza, LLC, and Brigid M. Higgins, Esq., of Gordon Silver, on behalf of Nevada State Bank, that the conditions for final dismissal have been met. Until Nevada State Bank is paid $5,500,000, neither the Debtor nor 5831 W. Craig, LLC, nor any of their insiders or affiliates, will file or cause to be filed another bankruptcy case of the Debtor or a bankruptcy case under 5831 W. Craig under any chapter of the Bankruptcy Code for 180 days. In the event that a bankruptcy is filed in violation of this final order, the Court will immediately enter an order lifting the automatic stay for the benefit of Nevada State Bank by a motion heard on shortened time, and the 14-day stay of that order is waived. If the property, real or personal, of the Debtor is transferred to an entity other than 5831 W. Craig, until Nevada State Bank is paid $5,500,000, neither that entity nor any of its insiders or affiliates will file or cause to be filed a bankruptcy case of that entity under any chapter of the Bankruptcy Code for 180 days. If that entity, the Debtor, 5831 W. Craig, or any of their insiders violate this final order, the Court will immediately enter an order lifting the automatic stay for the benefit of Nevada State Bank by a motion heard on shortened time, and the 14- day stay of that order is waived. The Debtor, 5831 W. Craig, that entity and their insiders will not oppose that motion. Las Vegas, Nevada-based Regal Plaza, LLC, owns a shopping center in Las Vegas, Nevada. The shopping center was originally constructed in 2000 on 5.72 acres which are operated as the Regal Plaza. There is 56,097 square feet of rentable space, approximately 22,510 square feet are currently occupied and 23,187 square feet are currently being improved for tenants with signed leases. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 10-26707) on Sept. 1, 2010. Lenard E. Schwartzer, Esq., at Schwartzer & Mcpherson Law Firm, in Las Vegas, Nev., represents the Debtor as counsel. In its schedules, the Debtor disclosed $10,815,564 in assets and $8,592,879 in liabilities as of the Petition Date. RIVIERA HOLDINGS: Moody's Affirms 'B3' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service changed Riviera Holdings Corporation's rating outlook to negative from stable following the company's announcement that it has entered into an agreement to sell the Riviera Black Hawk casino -- one of Riviera's two owned casinos -- to Monarch Casino & Resort, Inc. for $76 million. The company's B3 Corporate Family Rating and other ratings were affirmed. The transaction is expected to be completed in the second quarter of 2012 and is subject to various closing conditions, including Monarch obtaining a gaming license in Colorado. Ratings affirmed and LGD assessments revised: Corporate Family Rating at B3 Probability of Default Rating at B3 First Lien Series A $10 million revolver due 4/2016 at B2 (LGD 3, 35% from LGD 3, 36%) First Lien Series A $50 million term loan due 4/2016 at B2 (LGD 3, 35% from LGD 3, 36%) Second Lien Series B $20 million term loan due 4/2016 at Caa2 (LGD 5, 85% from LGD 5, 86%) RATINGS RATIONALE The change in the rating outlook to negative reflects the risk that if this transaction closes, Riviera will be reliant upon one remaining property -- the Riviera Hotel and Casino, located on the Las Vegas Strip -- that generated negative EBITDA for the 12 months ended June 30, 2011. Additionally, this property is located in a market that still faces a number of headwinds. Moody's believes the recovery of the Las Vegas Riviera will be slow due to the anemic pace of economic growth in the U.S. and Moody's expectation that gaming budgets will not increase materially in the near-term. While Riviera will benefit from the cash flow of the Riviera Black Hawk for the next 9 months until the transaction closes, the Las Vegas Riviera alone is not likely to generate sufficient cash flow to cover its interest expense and capital expenditure needs. However, the sale of the Riviera Black Hawk could result in improved near-term liquidity for Riviera because per the terms of Riviera's credit agreement, the company is only required to repay its bank debt in an amount that will bring it into compliance with its leverage and interest coverage financial covenants on a pro forma basis. Depending on the amount of debt Riviera elects to repay, the company could have as much as $50 million of cash following the close of the transaction. Under the terms of the credit agreement, $15 million of Series B term loan proceeds is restricted for capital expenditure projects at the Las Vegas Riviera. The affirmation of the B3 Corporate Family Rating reflects Riviera's good liquidity which benefits from the cash flow generation of the Black Hawk property at least until the second quarter of 2012 when the transaction is expected to close, and longer if the transaction does not close. The B3 rating also reflects that if the transaction closes, Riviera will be in a position to pay down the entirety of its bank debt. Ratings would likely be downgraded if the Black Hawk transaction were to close and Riviera did not pay down its bank debt in its entirety. Even if the transaction were to not close, ratings could be downgraded if the operating performance at the Las Vegas Riviera does not improve and the company's liquidity position deteriorates. Given the negative outlook, ratings are not expected to be raised in the near-term. A stable outlook would require that the Black Hawk transaction does not close and operating performance at the Las Vegas Riviera improves. Moody's would also need some comfort that Riviera would not look for another opportunity to sell the Black Hawk property. The principal methodology used in rating Riviera Holdings Corporation was the Global Gaming Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Riviera Holdings Corporation owns and operates the Riviera Hotel and Casino in Las Vegas and the Riviera Black Hawk casino in Colorado. The company generates approximately $120 million in net revenues annually. ROAM DEVELOPMENT: Case Summary & 10 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Roam Development Group, L.P. 630 Trade Center Drive Las Vegas, NV 89119 Bankruptcy Case No.: 11-25703 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtor's Counsel: Thomas H. Fell, Esq. GORDON SILVER 3960 Howard Hughes Pky 9th Flr Las Vegas, NV 89169 Tel: (702) 796-5555 Fax: (702) 369-2666 E-mail: tfell@gordonsilver.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nvb11-25703.pdf The petition was signed by Tanya Amid, manager of Rodev G.P., as general partner. SAGAMORE PARTNERS: In Chapter 11 to Address Dispute With Servicer ----------------------------------------------------------------- Jacqueline Palank, writing for Dow Jones' Daily Bankruptcy Review, reports that Sagamore Partners Ltd., the Florida owner of Miami Beach?s boutique Sagamore Hotel filed for Chapter 11 bankruptcy on Thursday in Miami. According to DBR, Sagamore Partners said in an e-mailed statement that while its hotel is ?profitable,? it filed for Chapter 11 in a bid to address difficulties with LNR Property, the special servicer of its mortgage. Special servicers are appointed to manage a loan when the borrower defaults. ?The Sagamore has never been a troubled property,? the statement read, according to DBR. ?The owner?s goal is to reinstate the property?s mortgage, apply $3.5 million currently being held by our lender?s servicing agent, as well as approving several new revenue-generating initiatives at the property, all of which have been denied without explanation by the servicing agent.? DBR relates that in April 2010, the Sun Sentinel reported on the hotel?s legal battle with special servicer LNR Property over its $30 million-plus mortgage. The special servicer had taken over managing the loan upon Sagamore?s default and sought to foreclose on the 93-room hotel; Sagamore fired back with its own lawsuit to stop the foreclosure, saying it had the money to keep up with its obligations. The bankruptcy filing automatically halts pending litigation. Sagamore Partners said it believes LNR is still the special servicer on the mortgage. According to DBR, owner Martin Taplin said the hotel will continue operating in Chapter 11. He said the hotel is ready to carry out agreements with ?highly respected food and beverage organizations? that would generate substantial revenues, but he said the special servicer has ?constantly denied? the agreements. DBR also relates that while LNR Property doesn?t comment on the specifics of any case in litigation, it said in an e-mailed statement that, ?Generally speaking, LNR Partners serves as the agent of a securitization trust when a borrower is unable to live up to the terms of its loan, including its scheduled payments,? said David Levin, vice chairman of investor relations for LNR Property. ?Our obligation is to protect the interests of the bondholders of the trust which include public and private pension funds, individuals and institutional investors.? The Sagamore Hotel has hosted the Playboy Super Bowl party and celebrities like Kate Moss, the report adds. SCOTTO RESTAURANT: Court Sets Oct. 12 Final Hearing on Cash Use --------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of North Carolina has authorized Scotto Restaurant Group, LLC, on an interim basis, to use cash collateral to pay the expense items in accordance with a budget. Any lender with a valid perfected lien on cash collateral is granted a replacement lien (the "Post-Petition Liens") on the Debtor's assets, to the same extent and priority as existed with the pre-petition collateral. A final hearing on the Debtor's motion for authorization to use cash collateral will be held on Oct. 12, 2011, at 9:30 a.m. A copy of the 2-week estimated budget is available for free at: http://bankrupt.com/misc/scotto.2-weekbudget.pdf About Scotto Restaurant Denver, North Carolina-based Scotto Restaurant Group, LLC, fka Scotto Holdings, LLC, operates 7 Firehouse Subs franchise locations and has approximately 100 employees. Three creditors placed Scotto Restaurant Group, LLC, fka Scotto Holdings LLC, in bankruptcy by filing an involuntary Chapter 11 petition (Bankr. W.D.N.C. Case No. 11-40506) on Aug. 11, 2011. The petitioning creditors are Lester B. High, William Holmes and Donald L. Myers. They allege to be owed $1.85 million in the aggregate on account of unsecured promissory notes. The petitioning creditors are represented by Kiah T. Ford, IV, Esq., at Parker, Poe, Adams & Bernstein LLP, as counsel. Judge George R. Hodges oversees the case. James H. Henderson, Esq., at The Henderson Law Firm, in Charlotte, N.C., represents the Debtor as counsel. SEAHAWK DRILLING: Court Confirms First Amended Joint Plan --------------------------------------------------------- On Sept. 28, 2011, the U.S. Bankruptcy Court for the Southern District of Texas entered an order confirming Seahawk Drilling, Inc., and its subsidiaries' First Amended Joint Plan of Reorganization, filed July 6, 2011, as further modified and supplemented through Sept. 27, 2011. A copy of the Final Plan, as confirmed, is available for free at: http://is.gd/ej4rHv A copy of the Confirmation Order is available for free at: http://is.gd/4helXo The Final Plan provides for the resolution of outstanding claims and interests in the Debtors. As provided in the Final Plan, with the exception of the payment of the DIP Loan, no distribution of the approximately 22.3 million shares of common stock of Hercules Offshore, Inc., which was received as part of the consideration for the sale of substantially all of the Debtors' drilling and other related assets will be made to holders of Allowed Claims or to holders of Allowed Class 8 Interests until after the Initial Distribution Date. The Initial Distribution Date is generally defined in the Final Plan to mean the date that is the later to occur of (i) the termination of Pride International, Inc.'s obligations to provide further credit support to the Debtors and the expiration of currently outstanding letters of credit arranged by Pride in favor of affiliates of the Debtors, (ii) the effective date of an agreement settling all disputed claims among Pride and the Debtors, or (iii) 20 days following the entry of an order by the Bankruptcy Court resolving the disputed claims among Pride and the Debtors. In addition, no distributions will be made to any holder of Allowed Class 8 Interests until after all allowed claims against the Debtors have been paid in full or reserved in full in accordance with the terms of the Final Plan. As provided in the Final Plan, allowed administrative claims, priority tax claims and secured tax claims will be paid in cash from the Liquidating Trust. The allowed administrative claim of Hayman Capital Master Fund, L.P. will be paid in Hercules Common Stock or cash in accordance with the terms of the Debtor-In- Possession Loan, Security and Guaranty Agreement dated as of April 27, 2011, among the Company, as Borrower, the other Debtors, as guarantors and Hayman, as lender. The allowed (i) other secured claims, (ii) priority non-tax claims, (iii) allowed general unsecured claims, (iv) litigation and other contingent unsecured claims, (v) disputed Pride International, Inc. claims and (vi) subordinated claims will be paid in Hercules Common Stock in accordance with the terms of the Final Plan. The remaining Hercules Common Stock and cash, if any, will be distributed to the holders of allowed interests on a pro rata basis, as provided in the Final Plan. On the effective date of the Final Plan, all interests in the Company consisting of outstanding shares of common stock of the Company will be canceled and any certificated or electronic shares representing such shares will become null, void and of no force or effect. In accordance with the terms of the Final Plan, on the Effective Date, the Company will issue 100 new shares of common stock to the Liquidating Trust to be held in accordance with the terms of the Final Plan, at which time the Liquidating Trust will be the sole stockholder of the Company. On the Effective Date, the trustee of the Liquidating Trust will be appointed the sole officer and director of the Company. The Company anticipates that the Effective Date will be on or around Oct. 4, 2011. The Effective Date will be designated on the Notice of Effective Date filed in accordance with the Final Plan. The Notice of Effective Date to be filed by the Debtors will (i) state that all conditions to the occurrence of the Effective Date have been satisfied or waived with the consent of the official committees appointed pursuant to the Bankruptcy Code in the Bankruptcy Case, (ii) specify the Effective Date and (iii) set forth the name, address, email address and telephone number of the Liquidating Trustee. On the Effective Date, the Debtors will deliver all of the Liquidating Trust Assets to the Liquidating Trust for the beneficial interest of holders of allowed claims and interests under the Final Plan. Additionally, on the Effective Date, the Hercules Common Stock will continue to be held pursuant to an escrow agreement on behalf of the Debtors for later distribution to holders of allowed claims and interests under the Final Plan. Thereafter, (i) the Liquidating Trustee will make all distributions of cash to the holders of allowed claims and interests, as applicable, in accordance with the provisions of this Final Plan and the Liquidating Trust Agreement and (ii) the escrow agent, on behalf of the Debtors, will make all distributions of Hercules Common Stock to the holders of allowed claims and interests, as applicable, in accordance with the provisions of the Final Plan. As of the close of business on the Effective Date, the Interests Register will be prepared. The Company's transfer agent charged with maintaining the record of registered holders of equity interests in the Company will, in conjunction with the cancellation of the outstanding equity interests of the Company, prepare a list of all such holders, and the number of shares held as of the Effective Date, and will forward that list to the Plan Agent for inclusion in the Interests Register. The listing of such former registered holders of equity interests in the Company, including former holders of the Company's common stock who held equity interests in their own name, will represent only the right of such holder to receive distributions in accordance with the Final Plan on account of the canceled equity interests. The former holders of the Company's common stock who held equity interests in their own name may transfer those rights by notifying the Plan Agent of such transfer. On the Effective Date, The Depository Trust Company (?DTC?), in conjunction with the cancellation of the equity interests of the Company, will prepare a list of all holders of such interests shown on the records of DTC as of the Effective Date, forward that list to the Plan Agent for inclusion in the Interests Register and establish an ?escrow CUSIP? number or numbers representing the shares held by the former holders of Interests which escrow CUSIP number(s) will represent only the right of such holder to receive distributions on account of the canceled Interests (an ?Escrow CUSIP Interest?). The holders of rights in the Escrow CUSIP Interests, including former beneficial owners of the Company's common stock, may transfer those rights. As of September 29, 2011, the Company had 12,582,455 shares of common stock issued and outstanding. No shares are reserved for future issuance in respect of claims and interests filed and allowed under the Final Plan. About Seahawk Drilling Houston, Texas-based Seahawk Drilling, Inc., engages in a jackup rig business in the United States, Gulf of Mexico, and offshore Mexico. It offers rigs and drilling crews on a day rate contractual basis. The Company and several affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 11-20089) on Feb. 11, 2011. Berry D. Spears, Esq., and Jonathan C. Bolton, Esq., at Fullbright & Jaworkski L.L.P., in Houston, serve as the Debtors' bankruptcy counsel. Shelby A. Jordan, Esq., and Nathaniel Peter Holzer, Esq. at Jordan, Hyden, Womble, Culbreth & Holzer, P.C., in Corpus Christi, Texas, serve as the Debtors' co-counsel. Alvarez and Marsal North America, LLC, is the Debtors' restructuring advisor. Simmons & Company International is the Debtors' transaction advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. Judy A. Robbins, U.S. Trustee for Region 7, appointed three creditors to serve on an Official Committee of Unsecured Creditors of Seahawk Drilling Inc. and its debtor-affiliates. Heller, Draper, Hayden, Patrick & Horn, L.L.C., represents the creditors committee. In its amended schedules, Seahawk Drilling disclosed $208,190,199 in assets and $438,458,460 in liabilities as of the petition date. Seahawk filed for Chapter 11 protection to complete the sale of all assets to Hercules Offshore, Inc. As reported by the Troubled Company Reporter on April 11, 2011, the Bankruptcy Court approved an Asset Purchase Agreement between Hercules Offshore and its wholly owned subsidiary, SD Drilling LLC, and Seahawk Drilling, pursuant to which Seahawk agreed to sell to Hercules, and Hercules agreed to acquire from Seahawk, all 20 of Sellers' jackup rigs and related assets, accounts receivable and cash and certain liabilities of Sellers in a transaction pursuant to Section 363 of the U.S. Bankruptcy Code. The deal was valued at about $176 million when it received court approval. The purchase price for the acquisition will be funded by the issuance of roughly 22.3 million shares of Hercules Offshore common stock and cash consideration of $25 million, which will be used primarily to pay off Seahawk's Debtor-in-Possession loan. The number of shares of Hercules Offshore common stock to be issued will be proportionally reduced at closing, based on a fixed price of $3.36 per share, if the outstanding amount of the DIP loan exceeds $25 million, with the total cash consideration not to exceed $45 million. The deal closed on April 27, 2011. SEQUOIA VILLAGE: Case Summary & 16 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Sequoia Village, LLC 7000 Monument Drive Grants Pass, OR 97526 Bankruptcy Case No.: 11-64880 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court District of Oregon Judge: Frank R Alley III Debtor's Counsel: Christopher L. Parnell, Esq. DUNN CARNEY ALLEN HIGGINS & TONGUE LLP 851 SW 6th Ave Portland, OR 97204 Tel: (503) 224-6440 E-mail: cparnell@dunncarney.com Scheduled Assets: $3,561,529 Scheduled Debts: $10,007,110 A list of the Company's 16 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/orb11-64880.pdf The petition was signed by Daniel Charbonneau, president of Carling of America, Ltd., member. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Sequoia Partners, LLC 10-67547 12/29/10 SITHE/INDEPENDENCE: Moody's Withdraws B2 Rating & Stable Outlook ---------------------------------------------------------------- Moody's Investors Service has withdrawn the B2 rating and stable outlook for Sithe/Independence Funding Corporation. RATINGS RATIONALE The withdrawals follow a cash tender offer by Dynegy Inc., Sithe Funding's ultimate parent, for Sithe Funding's 9% secured bonds due 2013, and the subsequent repayment of approximately $191.1 million, or 99.7% of the bonds outstanding at the time of the offer. The repayment was completed as of September 26, 2011. Interest and principal due on the remaining $582,179 of bonds outstanding will be repaid with funds currently on deposit with the bond trustee. The principal methodology used in this rating was Power Generation Projects published in December 2008. Sithe Funding is a wholly owned subsidiary of Sithe/Independence Power Partners, L.P. (Independence or the Project), which is a 1,064 MW natural gas fired cogeneration facility located in Oswego County, New York. Independence is indirectly owned by Dynegy Holdings, LLC (Caa3 CFR, negative). SOLYNDRA LLC: Watchdog Wants Trustee or Chapter 7 Conversion ------------------------------------------------------------ Roberta DeAngelis, the U.S. Trustee for Region 3, has asked the Bankruptcy Court to replace management of Solyndra LLC with a Chapter 11 trustee or, in the alternative, convert the case into a Chapter 7 liquidation. Steve Korris at Legal Newsline reports that the U.S. Trustee proposed to take over management of Solyndra if its leaders keep pleading Fifth Amendment privilege against self incrimination. "Management's invocation of the First Amendment does not excuse them from performing their fundamental disclosure and reporting duties under the bankruptcy code," staff trial attorney Jane Leamy, Esq., wrote for Ms. DeAngelis, according to the report. "A debtor in possession has a duty to inform creditors, the United States, and the court about its finances and the circumstances leading to its bankruptcy," Ms. Leamy wrote. The report says the motion throws a wrench into an auction Solyndra plans to hold on Oct. 28. Mr. Korris says Messrs. Harrison and Stover refused to answer questions on Sept. 23, at a Congressional committee hearing on a $535 million loan the Department of Energy guaranteed. The report also relates Ms. Leamy wrote that the executives have also refused to answer a number of other questions, including whether they submitted accurate information to investors, creditors and others. According to Ms. Leamy, they refused to answer when they realized Solyndra wasn't profitable. Messrs. Harrison and Stover also refused to answer whether the board discussed its unprofitability and whether they paid management bonuses after they realized their poor financial condition, Ms. Leamy alleges. She also states that they refused to answer whether they have a plan to repay the loan they obtained from the government, notes the report. The report adds Solyndra counsel Benjamin Schwartz refused to answer similar questions at an initial bankruptcy interview on Sept. 15, 2011. About Solyndra LLC Founded in 2005, Solyndra LLC is a U.S. manufacturer of solar photovoltaic solar power systems specifically designed for large commercial and industrial rooftops and for certain shaded agriculture applications. The Company had approximately 968 full time employees and 211 temporary employees. Solyndra has sold more than 500,000 of its panels since 2008 and generated cumulative sales of over $250 million. Fremont, California-based Solyndra and affiliate 360 Degree Solar Holdings Inc. sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12799) on Sept. 6, 2011. Solyndra is at least the third solar company to seek court protection from creditors since August 2011. Solyndra owed secured lenders $783.8 million, including $527.8 million to the U.S. government pursuant to a federal loan guarantee, and held assets valued at $859 million as of the Petition date. The U.S. Federal Financing Bank, owned by the U.S. Treasury Department, is the Company's biggest lender. In the Chapter 11 cases, the Debtors are pursuing a two-pronged strategy to effectuate either a sale of their business to a "turnkey" buyer who may acquire substantially all of Solyndra's assets or, if the Debtors are unable to identify any such potential buyers, an orderly liquidation of the Debtors' assets for the benefit of their creditors. Judge Mary F. Walrath presides over the Debtors' cases. The Debtors are represented by Pachulski Stang Ziehl & Jones LLP as legal adviser. AlixPartners LLP serves as noticing claims and balloting agent. Imperial Capital LLC serves as the company's investment banker and financial adviser. The Debtors also tapped former Massachusetts Governor William F. Weld, now with the law firm McDermott Will & Emery, to represent the company in government investigations and related litigation. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven unsecured creditors to serve on the Official Committee of Unsecured Creditors of Solyndra LLC. SPECIALTY PRODUCTS: Judge Won't Review Discovery Denial ------------------------------------------------------- Sindhu Sundar at Bankruptcy Law360 reports that a Delaware bankruptcy judge on Tuesday refused to reconsider her decision preventing Specialty Products Holding Corp. from obtaining discovery from asbestos claims trusts, saying the data the bankrupt chemical products company was seeking was irrelevant to its liability calculations. Law360 relates that Specialty Products had argued that information about how much the asbestos trusts had given their claimants was a vital gauge in its expert's methodology in calculating the debtor's own liability. About Specialty Products 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. STRATEGIC AMERICAN: C.W. Navigation Discloses 17.9% Equity Stake ---------------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission, C.W. Navigation, Inc., disclosed that it beneficially owns 48,366,667 shares of common stock of Strategic American Oil Corporation representing 17.97% of the shares outstanding based on 269,208,736 shares of the Company's common stock issued and outstanding as of Sept. 26, 2011. A full-text copy of the filing is available for free at http://is.gd/GNk5LA In a separate Schedule 13D filing, K.W. Navigation, Inc., disclosed that it beneficially owns 48,366,666 shares of common stock or 17.97% equity stake. A full-text copy of the filing is available for free at http://is.gd/udiib2 About Strategic American Corpus Christi, Tex.-based Strategic American Oil Corporation (OTC BB: SGCA) -- http://www.strategicamericanoil.com/-- is a growth stage oil and natural gas exploration and production company with operations in Texas, Louisiana, and Illinois. The Company's team of geologists, engineers, and executives leverage 3D seismic data and other proven exploration and production technologies to locate and produce oil and natural gas in new and underexplored areas. The Company's balance sheet at April 30, 2011, showed $17.51 million in total assets, $11.69 million in total liabilities and $5.82 million in total stockholders' equity. Going Concern As reported by the TCR on March 25, 2011, MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt about Strategic American Oil's ability to continue as a going concern following the Company's results for the fiscal year ended July 31, 2010. The independent auditors noted that the Company has suffered losses from operations and has a working capital deficit. In the Form 10-Q, the Company acknowledged that it had a working capital deficit of $3,362,822 and an accumulated deficit of $13,016,680 as of Jan. 31, 2011. The Company said its ability to continue as a going concern is dependent on raising additional capital to fund ongoing exploration and development and ultimately on generating future profitable operations. SUPERIOR PROPERTY: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Superior Property of 10621 Sepulveda, LLC, filed with the U.S. Bankruptcy Court for the Central District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ---------- ----------- A. Real Property $8,000,000 B. Personal Property $223,450 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $10,843,005 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $385,909 ---------- ----------- TOTAL $8,223,450 $11,228,914 About Superior Property Based in Mission Hills, California, Superior Property of 10621 Sepulveda, LLC, filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 11-20305) on Aug. 29, 2011. Judge Alan M. Ahart presides over the case. Michael S. Kogan, Esq., and Faye Rasch, Esq., at Ervin, Cohen & Jessup LLP, serves as counsel to the Debtor. TELESAT CANADA: Moody's Affirms 'B2' Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service changed Telesat Canada's outlook to developing from stable on expectations that the company is investigating a dividend recapitalization transaction and that it will be completed within a short time. At the same time, the company's B2 corporate family and probability of default ratings (CFR and PDR respectively) were affirmed as were all instrument ratings (see ratings listing below). Despite the pending October 31, 2012 maturity of the company's liquidity facility, Telesat's speculative grade liquidity rating remains unchanged at SGL-3 (adequate). During the third quarter of 2010, Telesat's board authorized management to explore an IPO and other strategic alternatives. Despite recent regulatory changes that exempt satellite companies from certain foreign ownership restrictions under both of Canada's Telecommunications Act and Radiocommunications Act, an acceptable transaction did not present itself. However, since the company's revolving credit facility matures in October of 2012 and since Moody's believes that a refinance or extension is impracticable without ownership commitment to both the business and a given capital structure, Moody's thinks that the advancing maturity date will mandate that a conclusion be reached one way or the other. Since recent management comments suggest that a recapitalization accompanied by a special dividend is now the most likely outcome, and given expectations of a near term resolution, Moody's has revised the outlook to developing. Despite the advancing maturity date of the company's revolving credit facility, Telesat has adequate liquidity arrangements. Moody's expects modest free cash flow over the next four quarters, there was $142 million of cash on the balance sheet at June 30 and there are no outstandings under the company's revolving credit facility, and Moody's does not anticipate financial covenant compliance difficulties. However, for a company in a capital intensive business with significant satellite launches over the next couple of years, the liquidity cushion is somewhat thin. The outlook action signals Moody's view that an outcome will be presented within the next couple of quarters. These outlines Moody's ratings and outlook actions and summarizes Telesat's current ratings: Issuer: Telesat Canada Outlook Actions: -- Outlook: Changed to Developing from Stable Ratings Actions -- Corporate Family Rating: Affirmed at B2 -- Probability of Default Rating: Affirmed at B2 -- Speculative Grade Liquidity Rating: Unchanged at SGL-3 -- Senior Secured Credit Facility: Affirmed at B1 with the loss given default assessment revised to LGD3, 32% from LGD3, 33% -- Senior Unsecured Regular Bond/Debenture: Affirmed at Caa1 (LGD5, 83%) -- Senior Subordinated Bond/Debenture: Affirmed at Caa1 (LGD6, 94%) RATINGS RATIONALE Telesat's B2 ratings are influenced primarily by two issues; a) event risk stemming from an ongoing strategic alternatives assessment that may result in a significant increase in debt; and b) the potential for significant estimation error given the lack of a clearly articulated plan for self-financing the company's expanding satellite fleet. Despite ongoing financial performance that generates signals from Moody's Communications Infrastructure rating methodology that are superior to the company's B2 ratings, these matters constrain the rating. For example, although smaller than industry leaders Intelsat and SES (each has in excess of 50 satellites and revenue of +/- $2.5 billion), Telesat has reasonable scale (12 satellites and +/- $820 million annual revenues) and a solid business model. As well, industry-wide growth prospects based on growing broadband demand are reasonable and Telesat's financial profile has improved significantly in recent periods given cash flow from new satellites and the appreciation of the C$ vs. the U.S.$ (Debt/EBITDA at June 30 was 5.1x after having been 8.5x at the end of 2009). Telesat has adequate liquidity, although the October 2012 maturity of its revolving credit facility suggests that a refinance is pending. Since it is difficult to conclude refinance activities until strategic matters are resolved, this brings us full circle to ongoing strategic alternatives initiatives -- Moody's anticipates a conclusion shortly -- this causes the developing outlook. Rating Outlook Telesat's board originally authorized management to explore an IPO and other strategic alternatives during the third quarter of 2010. The Developing outlook signals Moody's view that an outcome will be presented within the next couple of quarters. What Could Change the Rating - Up Until the company's ongoing strategic reassessment is concluded, a ratings upgrade is not expected. What Could Change the Rating - Down The outcome of the company's strategic reassessment may cause the facts to change and a downgrade may result. Unexpected liquidity issues could also result in adverse ratings activity. The principal methodology used in rating Telesat Canada was the Global Communications Infrastructure Rating Methodology Industry Methodology published in June 2011 and Probability of Default Ratings and Loss Given Default Assessments Industry Methodology published in June 2009. Corporate Profile Headquartered in Ottawa, Ontario, Canada, (Telesat) is the world's fourth largest provider of fixed satellite services (FSS). The company's twelve in-orbit satellites are concentrated in the Americas. Telesat has interests in an additional two under- construction satellites, has interests in the Canadian payload on Viasat-1 (which is also under construction), and manages operations of additional satellites for third parties. Telesat is an indirect, wholly-owned subsidiary of Telesat Holdings Inc. (Telesat Holdings); principal shareholders are Canada's Public Sector Pension Investment Board and Loral Space & Communications Inc. (NASDAQ: LORL). Other than its ownership interest in Telesat, Telesat Holdings has no other material assets or operations, and since Telesat Holdings guarantees Telesat Canada's rated debts, Moody's relies on Telesat Holdings financial statements in rating Telesat Canada. TELTRONICS INC: To Sell Off Assets Under Exit Plan -------------------------------------------------- Tampa Bay Bankruptcy Center reports that Teltronics Inc. has filed a Chapter 11 bankruptcy exit plan that includes selling off its assets. According to the report, little has been revealed in the form of details about the potential sale in the plan filed on Sept. 30, 2011, in U.S. Bankruptcy Court in Tampa, Florida. There is no information on possible buyers, an opening bid price and the status of its marketing efforts so far. The date of the close of the sale, however, is known and expected to be before Dec. 6, 2011 -- the date Teltronics is due to repay the $3 million loan it took from Wells Fargo & Co. to continue operations throughout its bankruptcy. The report, citing papers filed with the Court, says that the estimated liability of the company topped $19.8 million while its assets come up to a comparably smaller $9.1 million. A summary of the bankruptcy plan, if it is approved by the bankruptcy court, will be sent to each of the company's creditors. But the plan did not estimate how much money other creditors could receive after the profits company makes from the sale. About Teltronics Inc. Palmetto, Fla.-based Teltronics, Inc. (OTC BB: TELT) -- http://ww.teltronics.com/-- designs, installs, develops, manufactures and markets electronic hardware and application software products, and engages in electronic manufacturing services primarily in the telecommunication industry. Teltronics has three wholly owned subsidiaries, Teltronics Limited, 36371 Yukon Inc., and TTG Acquisition Corp. Teltronics filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 11-12150) on June 27, 2011. Judge K. Rodney May presides over the case. Charles A. Postler, Esq., at Stichter, Riedel, Blain & Prosser, serves as the Debtor's counsel. The petition was signed by Ewen R. Cameron, president. The U.S. trustee has appointed an official committee of unsecured creditors in the case. Wells Fargo Capital Finance Inc., as DIP Lender, is represented by Donald Kirk, Esq., at Fowler White Boggs P.A., and Pamela Kohlman, Esq., at Webster, Buchalter Nemer, P.C. TEMPLE OF PRAYER: Case Summary & Largest Unsecured Creditor ----------------------------------------------------------- Debtor: Temple of Prayer Christian Fellowship 1377 Bar Harbor Drive Dallas, TX 75232 Bankruptcy Case No.: 11-36331 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Daniel C. Durand, III, Esq. DURAND AND ASSOCIATES 522 Edmonds Lane, Suite 101 Lewisville, TX 75067 Tel: (972) 221-5655 E-mail: durand@durandlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ TXU Energy Utility $2,300 The petition was signed by Porter Perry, pastor. TIRES UNLIMITED: Files for Chapter 11 Bankruptcy Protection ----------------------------------------------------------- Dayton (Ohio) Daily News reports that Tires Unlimited Inc. sought Chapter 11 protection in U.S. Bankruptcy Court on Sept. 30, 2011. According to the company's petition, Tires Unlimited estimated its assets at less than $50,000 and liabilities at between $1 million and $10 million. The 20 largest unsecured claims against Tires Unlimited total about $1.76 million. The report, citing records from Montgomery County Common Pleas Court, says First Financial Bank recently won a judgment of nearly $1.25 million against Tires Unlimited. Ira H. Thomsen, Esq., is the company's bankruptcy attorney. Tires Unlimited Inc. -- http://www.tiresunlimited.com/-- sells Motorcycle tires, ATV tires, specialty tires, and tubes. TIRES UNLIMITED: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Tires Unlimited, Inc. 4742 Wadsworth Road Dayton, OH 45414 Bankruptcy Case No.: 11-35315 Chapter 11 Petition Date: September 30, 2011 Court: United States Bankruptcy Court Southern District of Ohio (Dayton) Judge: Guy R. Humphrey Debtor's Counsel: Ira H Thomsen, Esq. LAW OFFICE OF IRA H. THOMSEN 140 North Main St., Suite A P.O. Box 639 Springboro, OH 45066 Tel: (937) 748-5001 Fax: (937) 748-5003 E-mail: cornell76@aol.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ohsb11-35315.pdf The petition was signed by Rodney M. Gasvoda, president. TITAN SPECIALTIES: S&P Raises Corporate Credit Rating to 'B' ------------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Milford, Texas-based Titan Specialties Ltd. to 'B' from 'B-', and removed the ratings from CreditWatch with positive implications, where S&P had placed them on Aug. 12, 2011. "We subsequently withdrew the corporate credit and issue-level ratings on Titan, reflecting the repayment of Titan's $160 million first-lien credit facility and $45 million second-lien bank loan following its acquisition by Hunting PLC," S&P related. "The rating actions follow the announcement that London-based Hunting PLC has acquired TSI Acquisition Holdings LLC and its subsidiaries, including Titan Specialties Ltd., in a transaction valued at approximately $775 million," said Standard & Poor's credit analyst Stephen Scovotti. Titan's upgrade reflects its acquisition and integration into Hunting PLC, which, based on publicly available information, we assess would have a stronger credit profile than Titan had prior to its acquisition. Hunting (not rated) is an international oilfield service and equipment company that is listed on the London Stock Exchange. Hunting has principal operations in the U.K., Canada, China, Hong Kong, Indonesia, Mexico, Netherlands, Singapore, United Arab Emirates, and the U.S. Hunting's well construction and well completion businesses focus on high specification downhole tools and equipment. Titan's perforating gun systems, charges, switches and instrumentation will be complementary to Hunting's tools and equipment. "Following the upgrade and repayment of Titan's rated debt, we withdrew the corporate credit rating on Titan," S&P said. TOUSA INC: Can Access Prepetition Lenders' Cash Until Jan. 31 ------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida has authorized TOUSA, Inc., and its debtor-affiliates, to access, on an interim basis, the cash collateral of their prepetition first and second lien lenders through Jan. 31, 2012, pursuant to a budget for the period beginning Oct. 1, 2011, through Jan. 31, 2012. The authorization to use cash collateral pursuant to this tenth interim order, will terminate upon the earlier of (i) Jan. 31, 2012; and (ii) absent further order of the Court, the date that is 3 business days after the Revolver Agent delivers written notice to the Debtors and the Creditors' Committee of the occurrence of a Cash Collateral Termination Event. A final hearing on the motion to use cash collateral will be held on Oct. 27, 2011, at 9:30 a.m. Parties in interest objecting to the entry of the Final Order will file written objects with the Court no later than 5:00 p.m. (EDT) on Oct. 21, 2011. A copy of the tenth interim cash collateral order is available for free at http://bankrupt.com/misc/tousainc.dktno.8314.pdf About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA, Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on Jan. 29, 2008 (Bankr. S.D. Fla. Case No. 08-10928). Richard M. Cieri, Esq., M. Natasha Labovitz, Esq., and Joshua A. Sussberg, Esq., at Kirkland & Ellis LLP, in New York, N.Y.; and Paul S. Singerman, Esq., at Berger Singerman, in Miami, Fla., represent the Debtors in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. The official committee of unsecured creditors has filed a proposed chapter 11 liquidating plan for Tousa. However, the committee said that it no longer intends to pursue approval of its liquidation plan because of the pending appeal of its fraudulent transfer case in the U.S. Court of Appeals for the Eleventh Circuit. A district court in February 2011 held that the bankruptcy judge was wrong in ruling that lenders who were paid off received fraudulent transfers when Tousa gave liens on subsidiaries' properties to bail out and refinance a joint venture. Daniel H. Golden, Esq., and Philip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, N.Y., represent the creditors committee. TOWNSEND CORP: Hires McQueen & Ashman as Special Counsel -------------------------------------------------------- Townsend Corporation, doing business as Land Rover Jaguar Anaheim Hills, and LRJC, Inc., doing business as Land Rover Jaguar Cerritos, seek authority from the United States Bankruptcy Court for the Central District of California to employ McQueen & Ashman LLP as their special corporate and litigation counsel. M&A and its attorneys have served as general outside counsel to the Debtors since their inceptions and to the previous Land Rover dealerships owned by the Debtors' principals. As special counsel to the Debtors, M&A will: -- continue to represent them in ongoing and recently filed litigation brought by consumers; -- continue to represent them in negotiations with potential purchasers of their dealerships; -- document any potential sale of their dealerships; -- continue to advise and represent them in connection with any employee issues that may arise; -- represent them in any adversary proceedings; and -- assist them and their general bankruptcy counsel in the formulation of a plan of reorganization and preparation of disclosure statement. M&A will be paid according to its standard hourly billing rates and will be reimbursed of its necessary expenses. The Debtors expect that Phillip Ashman, Esq., and Brian A. Kumamoto, Esq., will be the primary attorneys responsible for the representation of the Debtors. M&A's current hourly rates are: Partners Rate -------- ---- James A. McQueen $400 Phillip Ashman $395 Brian A. Kumamoto $375 Of Counsel ---------- Sherry Bilbeisi $350 Gary A. Foltz $325 Paralegal --------- Bob Hackney $195 Mailei Bennett $150 Mr. Ashman assures the Court that M&A is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Townsend Corp. and LRJC Auto dealers Townsend Corporation, d/b/a Land Rover Jaguar Anaheim Hills, and LRJC, Inc., d/b/a Land Rover Jaguar Cerritos, filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case Nos. 11-22690 and 11-22695) on Sept. 9, 2011. Judge Robert N. Kwan presides over the cases. Martin J. Brill, Esq., and Todd M. Arnold, Esq. -- mjb@lnbyb.com and tma@nbyb.com -- at Levene, Neale, Bender, Yoo & Brill LLP, in Los Angeles, represent the Debtors. Each of the Debtors estimated $10 million to $50 million in both assets and debts. The petitions were signed by Ernest W. Townsend, IV, the president. TOWNSEND CORP: Taps Levene Neale as Bankruptcy Counsel ------------------------------------------------------ Townsend Corporation, doing business as Land Rover Jaguar Anaheim Hills, and LRJC, Inc., doing business as Land Rover Jaguar Cerritos, seek permission from the United States Bankruptcy Court for the Central District of California to employ Levene, Neale, Bender, Yoo & Brill L.L.P. as their bankruptcy counsel, nunc pro tunc to Petition Date. As counsel, LNBYB will: -- advise the Debtors with regard to the requirements of the Court, Bankruptcy Code, Bankruptcy Rules, and the Office of the United States Trustee as they pertain to the Debtors; -- advise the Debtors with regard to certain rights and remedies of their bankruptcy estates and the rights, claims and interests of creditors; -- represent the Debtors in any proceeding or hearing involving their estates unless the Debtors are represented in the proceeding or hearing by other special counsel; -- conduct examinations of witnesses, claimants or adverse parties and represent the Debtors in adversary proceedings; -- prepare and assist the Debtors in the preparation of reports, applications, pleadings and orders; -- represent the Debtors with regard to obtaining use of debtor in possession financing and cash collateral; and -- assist the Debtors in the negotiation, formulation, preparation and confirmation of plans of reorganization and the preparation and approval of disclosure statements in respect of the plans. The Debtors will pay LNBYB for its representation of them in accordance with the Firm's standard hourly billing rates. The Debtors will also reimburse LNBYB of its necessary expenses. The Debtors expect that Martin J. Brill, Esq., and Todd M. Arnold, Esq., will be the primary attorneys at LNBYB responsible for the Debtors' cases. The Firm's 2011 hourly billing rates are: Attorneys Rate --------- ---- David W. Levene $595 David L. Neale $595 Ron Bender $595 Martin J. Brill $595 Timothy J. Yoo $595 Edward M. Wolkowitz $595 David B. Golubchik $575 Monica Y. Kim $550 Beth Ann R. Young $550 Daniel H. Reiss $550 Irving M. Gross $550 Philip A. Gasteier $550 Jacqueline L. James $495 Juliet Y. Oh $495 Michelle S. Grimberg $495 Todd M. Arnold $495 Todd A. Frealy $495 Anthony A. Friedman $435 Carmela T. Pagay $435 Krikor J. Meshefejian $375 John-Patrick M. Fritz $375 Gwendolen D. Long $345 Lindsey L. Smith $275 Paraprofessionals $195 During the one-year period prior to its Chapter 11 filing, LRJAH paid an initial retainer of $20,000 subsequently followed by each Debtor providing an additional retainer of $50,000 to LNBYB for legal services in contemplation of and in connection with the Debtors' cases, inclusive of the Debtors' two $1,039 Chapter 11 bankruptcy filing fees, Ernest W. Townsend IV, the Debtors' president, disclosed. He notes that the $98,480 Retainer balance as of the Petition Date will remain on deposit in LNBYB's general account. Martin J. Brill, a partner at LNBYB, assures the Court that his Firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Townsend Corp. and LRJC Auto dealers Townsend Corporation, d/b/a Land Rover Jaguar Anaheim Hills, and LRJC, Inc., d/b/a Land Rover Jaguar Cerritos, filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case Nos. 11-22690 and 11-22695) on Sept. 9, 2011. Judge Robert N. Kwan presides over the cases. Each of the Debtors estimated $10 million to $50 million in both assets and debts. The petitions were signed by Ernest W. Townsend, IV, the president. TOWNSENDS INC: Chapter 11 Switched on Consent to Chapter 7 ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Townsends Inc. was granted its wish when the bankruptcy judge in Delaware signed an order on Oct. 4 converting the Chapter 11 case to a liquidation in Chapter 7 where a trustee will be appointed automatically. The conversion is to take effect Oct. 13, according to the report. Mr. Rochelle recounts that the asset sale was completed in February for $76.4 million, not leaving enough behind to warrant even an attempt at confirming a liquidating Chapter 11 plan, the company said. About Townsends Inc. Founded in 1891, Townsends Inc. is a third-generation, family- owned poultry company. Headquartered in Georgetown, Delaware, Townsends operates production and processing facilities in Arkansas and North Carolina. Townsends Inc. -- fka Townsend Specialty Foods -- and several affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 10-14092) on Dec. 19, 2010. As of Dec. 5, 2010, the Debtors disclosed $131 million in total assets and $127 million in total debts. Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell, serves as the Debtors' bankruptcy counsel. McKenna Long & Aldridge LLP serves as special counsel. Huron Consulting Group's Dalton T. Edgecomb serves as the Debtors' chief restructuring officer. SSG Capital Advisors, LLC, serves as investment banker. Donlin, Recano & Company, Inc., is the Debtors' claims, noticing and balloting agent. An Official Committee of Unsecured Creditors has been appointed in the case. The Committee has tapped Lowenstein Sandler PC as its counsel and J.H. Cohn LLP as its financial advisor. No trustee or examiner has been appointed in the Debtors' bankruptcy cases. The Debtors sold virtually all of their assets in two asset sale transactions which closed on Feb. 25, 2011. The purchasers were Omtron, Ltd., and Peco Foods, Inc. TRI-STATE SIGNAL: Files for Chapter 11 Bankruptcy Protection ------------------------------------------------------------ Boston Business Journal reports that Tri-State Signal Inc. filed on Oct. 3, 2011, for protection under Chapter 11 of the Bankruptcy Code. According to the report, the Company listed assets in the range of $1 million to $10 million and debts in the same range. Creditor Middlesex Savings Bank moved Oct. 4, 2011, to protect assets, stating in a motion: "Tri-State's obligations to the bank, exclusive of legal fees, costs of collection and other fees, charges and expenses, currently exceed $2,200,285." The motion continues: "The Debtor's accounts receivable are its only real asset, as it has ceased operations and sold most if not all of its vehicles and equipment." Tri-State is represented in the Chapter 11 proceedings by attorney Nina M. Parker, Esq., of Winchester, Massachusetts. Middlesex Savings is represented by attorney Richard A. Seils Jr., Esq., of Worcester. Based in Chelsea, Massachusetts, Tri-State Signal Inc. provides services include installing and maintaining traffic lights. TRI-STATE SIGNAL: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Tri-State Signal, Inc. 111 Crescent Avenue Chelsea, MA 02150 Bankruptcy Case No.: 11-19453 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Joan N. Feeney Debtor's Counsel: Nina M. Parker, Esq. PARKER & ASSOCIATES 10 Converse Place Winchester, MA 01890 Tel: (781) 729-0005 Fax: (781) 729-0187 E-mail: nparker@ninaparker.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Robert B. Dawe, Jr., president, treasurer and director. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Vega Crescent Avenue, LLC 11-19452 10/03/11 TRIBUNE CO: Bar Date Order Excluded D&O Indemnification Claims -------------------------------------------------------------- Bankruptcy Judge Kevin Carey clarified that the March 25, 2009 Claims Bar Date Order does not require current or former officers or director who remain employed by Tribune and its affiliates to file claims for indemnification or contribution arising from or related to the adversary proceedings commenced by the Official Committee of Unsecured Creditors or the state law constructive fraudulent conveyance claims actions by the Bar Date. Any current or former directors and officers of the Debtors who cease to be employed by the Debtors will have the longer of 60 days after (i) the last day of employment with the Debtors; and (ii) in the case that directors and officers of the Debtors have become disassociated from the Debtors postpetition but prior to the entry of this order, entry of this order to timely file an indemnification or contribution claim against the Debtors arising from or related to the Adversary Proceedings or the SLCFC Actions, Judge Carey ruled. Judge Carey further ruled that this order will not affect the underlying merits of any proof of claim but will only address the timeliness for filing those claims. Before entry of the order, counsel to the Creditors' Committee, Kimberly A. Brown, Esq., at Landis Rath & Cobb LLP, in Wilmington, Delaware, stated that the Debtors, the Creditors' Committee and various parties engaged in additional negotiation regarding the form of order with respect to the joint motion clarifying the Claims Bar Date. The Creditors' Committee submitted to the Court on September 30, 2011, a revised proposed order under a certification of counsel in a manner consistent with the negotiation. Following further negotiation regarding the proposed order, the Creditors' Committee withdrew the certification of counsel and attached proposed order. On October 3, 2011, the Creditors' Committee submitted to Judge Carey a further revised proposed order, which is in a form acceptable to all parties, according to Ms. Brown. The revised proposed order provides that any former director or officer of the Debtors who ceases to be employed by the Debtors and who does not timely file an indemnification or contribution claim and who did not previously file a proof of claim will not be treated as a creditor in these Chapter 11 cases, and thus will not be permitted to: (i) vote on any plan of reorganization or plan of liquidation with respect to a claim; (ii) receive any distribution under any confirmed plan with respect to that claim. Judge Carey signed the revised proposed order on October 3, 2011. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. 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 Dec. 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. Two competing Chapter 11 plans are being pursued in the Chapter 11 cases of Tribune. One plan is being co-proposed by the Debtors, the Official Committee of Unsecured Creditors, Oaktree Capital Management, L.P., Angelo Gordon & Co., L.P. and JPMorgan Chase Bank, N.A. A second plan is being pursued by Aurelius Capital Management LP, on behalf of its managed entities; Deutsche Bank Trust Company Americas, in its capacity as successor indenture trustee for certain series of senior notes; Law Debenture Trust Company of New York, in its capacity as successor indenture trustee for certain series of senior notes; and Wilmington Trust Company, in its capacity as successor indenture for the PHONES Notes. Judge Kevin J. Carey has not issued a ruling on the plan. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Late D&O Indemnification Claims Deemed Timely Filed --------------------------------------------------------------- Judge Kevin Carey approved the stipulation treating certain late- filed indemnification claims of certain former directors and officers of Tribune Co. as timely-filed. The bankruptcy judge also approved the uniform procedures for entry into identical stipulations with the Other Potential D&O Claimants. Before entry of the order, counsel to the Official Committee of Unsecured Creditors, Kimberly A. Brown, Esq., at Landis Rath & Cobb LLP, in Wilmington, Delaware, told the Court that the Debtors, the Creditors' Committee and various parties engaged in additional negotiation regarding the proposed order approving the joint motion. On September 30, 2011, the Creditors' Committee filed a revised proposed order under certification of counsel in a manner consistent with the negotiation. Following further negotiation regarding the form of order, the Creditors' Committee withdrew the certification of counsel and attached proposed order. The Creditors' Committee filed with the Court on October 3, 2011 a further revised proposed order, which is in a form acceptable to all parties, Ms. Brown stated. The revised proposed order provides that any D&O Claimant or Potential D&O Claimant who did not previously file a proof of claim and does not timely file an indemnification or contribution claim in accordance with the procedures set forth in the Joint Motion or the D&O Stipulation will not be treated as a creditor in these Chapter 11 cases, and thus will not be permitted to: (i) vote on any plan of reorganization or plan of liquidation with respect to a claim; (ii) receive any distribution under any confirmed plan with respect to that claim. Judge Carey signed the revised proposed order on October 3, 2011. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. 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 Dec. 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. Two competing Chapter 11 plans are being pursued in the Chapter 11 cases of Tribune. One plan is being co-proposed by the Debtors, the Official Committee of Unsecured Creditors, Oaktree Capital Management, L.P., Angelo Gordon & Co., L.P. and JPMorgan Chase Bank, N.A. A second plan is being pursued by Aurelius Capital Management LP, on behalf of its managed entities; Deutsche Bank Trust Company Americas, in its capacity as successor indenture trustee for certain series of senior notes; Law Debenture Trust Company of New York, in its capacity as successor indenture trustee for certain series of senior notes; and Wilmington Trust Company, in its capacity as successor indenture for the PHONES Notes. Judge Kevin J. Carey has not issued a ruling on the plan. 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) TROPICANA ENT: Hearing on Tropicana Trademark on Nov. 22 -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware's agenda continued the hearing with respect to the adversary complaint captioned Icahn, et al., vs. Tropicana Las Vegas, Inc. and Hotel Ramada of Nevada, LLC, to November 22 2011, at 10:00 a.m., EST. Originally filed in August 2010, the Icahn Plaintiffs, under the Adversary Complaint, sought to enjoin the Tropicana LV Defendants from asserting in a Nevada state court action that they are the owners of the "TROPICANA" and "TROP" trademarks and service marks. By September 2010, the Defendants sought dismissal of the Complaint. A year after the Complaint was filed, the Tropicana LV Defendants reached a trademark settlement agreement with the OpCo Debtors, the OpCo-Related Entities, and the Liquidating LandCo Debtors relating to the ownership of the "TROPICANA" and "TROP" trademarks. The Court approved the Trademark Settlement in mid- September 2011. About Tropicana Entertainment Tropicana Entertainment Inc. is a publicly reporting company that, along with its affiliates, owns or operates nine casinos and resorts in Indiana, Louisiana, Mississippi, Nevada and New Jersey. The Company owns approximately 6,000 rooms, 9,000 slot positions and 250 table games. In addition, the Company owns a development property in Aruba. The company is based in Las Vegas, Nevada. Tropicana Entertainment LLC and certain affiliates filed for Chapter 11 protection on May 5, 2008 (Bankr. D. Del. Case No. 08- 10856). Kirkland & Ellis LLP and Mark D. Collins, Esq., at Richards Layton & Finger, represent the Debtors in their restructuring efforts. Their financial advisor is Lazard Ltd. Their notice, claims, and balloting agent is Kurtzman Carson Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors' Web site administration agent. AlixPartners LLP is the Debtors' restructuring advisor. Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell LLP represent the Official Committee of Unsecured Creditors in this case. Capstone Advisory Group LLC is financial advisor to the Creditors' Committee. The OpCo Debtors, a group of Tropicana entities owning casinos and resorts in Atlantic City, New Jersey and Evansville, Indiana obtained confirmation from the Bankruptcy Court of a reorganization plan. On April 29, 2009, non-debtor units of the OpCo Debtors, designated as the New Jersey Debtors -- Adamar of New Jersey, Inc., and its affiliate, Manchester Mall, Inc. -- filed for Chapter 11 (Bankr. D. N.J. Lead Case No. 09- 20711) to effectuate a sale of the Atlantic City Resort and Casino to a group of Investors-led by Carl Icahn. Judge Judith H. Wizmur presides over the cases. Manchester Mall is a wholly owned subsidiary of Adamar that owns and operates certain real property utilized in the New Jersey Debtors' business operations. Effective March 8, Tropicana Entertainment successfully emerged from the Chapter 11 reorganization process as an Carl Icahn-owned entity. A group of Tropicana entities, known as the LandCo Debtors, which own Tropicana casino property in Las Vegas, have obtained approval of a separate Chapter 11 plan. Ilana Volkov, Esq., and Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman & Leonard, in Hackensack, New Jersey, represented the New Jersey Debtors. Kurtzman Carson Consultants LLC acts as their claims and notice agent. Adamar disclosed $500 million to $1 billion both in total assets and debts in its petition. Manchester Mall disclosed $1 million to $10 million in total assets, and less than $50,000 in total debts in its petition. Debtors Adamar of New Jersey Inc. and Manchester Mall Inc. have merged into Adamar of NJ In Liquidation, LLC. The merger and name change is in accordance with an Amended and Restated Purchase Agreement, which governs the sale and transfer of the operations of the Tropicana Casino and Resort - Atlantic City, including substantially all of the New Jersey Debtors' assets, to Tropicana Entertainment Inc., Tropicana Atlantic City Corp., and Tropicana AC Sub Corp., free and clear of any and all liens, claims and encumbrances. Bankruptcy Creditors' Service, Inc., publishes Tropicana Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Tropicana Entertainment Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) UNITED ENERGY: Chief Executive Officer Ronald Wilen Dies -------------------------------------------------------- Ronald Wilen, the chief executive officer, president and director of United Energy Corp., passed away on Oct. 1, 2011. About United Energy United Energy Corp. -- http://www.unitedenergycorp.net/-- develops and distributes environmentally friendly specialty chemical products with applications in several industries and markets. Through its wholly owned subsidiary, Green Globe Industries, Inc., the Company provides the U.S. military with a variety of solvents, paint strippers and cleaners under its trade name "Qualchem." The Company is headquartered in Secaucus, New Jersey. The Company's balance sheet at September 30, 2010, showed $1.02 million in total assets, $1.08 million in total liabilities, all current, and a stockholders' deficit of $69,308. As reported in the Troubled Company Reporter on July 20, 2010, Jewett, Schwartz, Wolfe & Associates, in Hollywood, Fla., expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended March 31, 2010. The independent auditors noted that the Company has operating and liquidity concerns, and has incurred net losses of $23.55 million as of March 31, 2010. U.S. DRY CLEANING: Completes Chapter 11 Reorganization ------------------------------------------------------ Pacific Business News reports that U.S. Dry Cleaning Services Corp. said on Oct. 4, 2011, that it has completed its Chapter 11 bankruptcy reorganization. According to the report, U.S. Dry Cleaning stated that it converted about $17.7 million of debt into equity and closed or relocated 12 unprofitable stores. As reported in the Troubled Company Reporter, U.S. Dry Cleaning and seven of its affiliates filed with the U.S. Bankruptcy Court for the Central District of California on Jan. 3, 2011, a Chapter 11 Plan of Reorganization and a related disclosure statement. On Sept. 23, 2011, the Bankruptcy Court entered an order confirming USDC's First Amended Joint Consolidated Chapter 11 Plan of Reorganization dated Sept. 14, 2011, as further modified. The Modified Plan, filed on Sept. 21, was effective upon confirmation. Pursuant to the Plan, on Sept. 23, 2011, Alex M. Bond was appointed Chief Executive Officer of USDC. From December 2007 to June 2011, Mr. Bond was Managing Director of Wattles Capital Management, where he was involved in a wide range of retail- related investments. Pursuant to the Plan, on Sept. 23, the Board of Directors of USDC consisted of Robert Y. Lee, Michael Drace, Timothy Rand, Martin J. Brill, Michael J. Smith and Alex M. Bond. Messrs. Lee, Drace, Rand and Brill were all members of USDC's Board prior to confirmation of the Modified Plan. Mr. Lee will serve as Chairman. The Plan provides for the Debtors' emergence from their Chapter 11 Cases as one consolidated entity under USDC. The Reorganized Debtor will own and operate the dry cleaning stores which are currently owned collectively by the Debtors. The Plan will be funded by the Exit Financing in the aggregate amount of $8,800,000, plus the Debtors' Cash on hand of roughly $200,000. About $4.4 million of Exit Financing was to be raised prior to confirmation, and the remainder would be raised after the Effective Date. The Debtor expects that on the Effective Date, it will have $4.5 million with which to fund payments immediately due under the Plan. The Debtor expects to raise an additional $2.5 million to $3.5 million of Exit Financing, which will be used to pay the Professional Notes. The balance of Allowed Claims will be satisfied by the issuance of the New Common Stock and/or payment over time by the Reorganized Debtor. A copy of the Modified Plan is available for free at: http://is.gd/09okmO About U.S. Dry Cleaning Services Newport Beach, California-based U.S. Dry Cleaning Services Corporation (d/b/a US Dry Cleaning Corporation) owns and operates 71 dry cleaning stores and three processing plants in the United States. USDC and seven of its affiliates filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the Central District of California on March 4, 2010. Simon Aron, Esq., and Susan K. Seflin, Esq., at Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP, are the attorneys for the Debtors. The cases are jointly administered under Enivel, Inc., Case No. 10-12735. Charles T. Moffitt is the Debtors' Chief Restructuring Officer. The Company estimated its assets at $1 million to $10 million and debts at $10 million to $50 million. VEGA CRESCENT: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Vega Crescent Avenue, LLC 111 Crescent Avenue Chelsea, MA 02150 Bankruptcy Case No.: 11-19452 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Frank J. Bailey Debtor's Counsel: Nina M. Parker, Esq. PARKER & ASSOCIATES 10 Converse Place Winchester, MA 01890 Tel: (781) 729-0005 Fax: (781) 729-0187 E-mail: nparker@ninaparker.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $0 to $50,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Robert B. Dawe, Jr. manager. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Tri-State Signal, Inc. 11-19453 10/03/11 WAHE GURU: Case Summary & 10 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Wahe Guru One LLC 4550 W. Buckingham Rd Garland, TX 75042 Bankruptcy Case No.: 11-36282 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Stacey G. Jernigan Debtor's Counsel: Eric A. Liepins, Esq. ERIC A. LIEPINS, P.C. 12770 Coit Rd., Suite 1100 Dallas, TX 75251 Tel: (972) 991-5591 E-mail: eric@ealpc.com Scheduled Assets: $1,802,000 Scheduled Debts: $3,475,962 A list of the Company's 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txnb11-36282.pdf The petition was signed by Baldev Singh, managing member. WESTERN COMMUNICATIONS: Oregon Papers Have Nod for Cash Use ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Western Communications Inc. received final authorization from the bankruptcy judge on Oct. 5 to use cash through May, unless there's a default in the meantime. The cash represents collateral for the secured lender Bank of America NA. About Western Communications Western Communications, Inc., is a family-owned corporation founded by renowned editor Robert W. Chandler. Headquartered in Bend, Oregon, Western Communications is a small market newspaper, niche publishing, printing and digital media company with publications spread throughout Oregon (six publications) and California (two publications). The Company produces and publishes the Bend Bulletin, the Baker City Herald, the La Grande Observer, the Redmond Spokesman, the Brookings Curry Coastal Pilot, the Crescent City Daily Triplicate, and the Sonora Union Democrat. The Company also publishes the Central Oregon Nickel Ads in Bend, Oregon. Western Communications filed for Chapter 11 bankruptcy (Bankr. Ore. Case No. 11-37319) on Aug. 23, 2011. Albert N. Kennedy, Esq., and Michael W. Fletcher, Esq., at Tonkon Torp LLP, in Portland, Oregon, serve as the Debtor's bankruptcy counsel. The Zinser Law Firm, P.C., and Davis Wright Tremaine LLP serve as the Debtor's special purpose counsel. The petition was signed by Gordon Black, president. The United States Trustee said that a committee under 11 U.S.C. Sec. 1102 has not been appointed because an insufficient number of persons holding unsecured claims against Western Communications have expressed interest in serving on a committee. WILLIAM LYON: Fails to Pay $7.4 Million of Senior Notes Interest ---------------------------------------------------------------- William Lyon Homes, Inc., a wholly-owned subsidiary of William Lyon Homes, is the issuer of certain 10 3/4% Senior Notes due 2013, with an aggregate principal amount outstanding of approximately $138,760,000. A semi-annual interest payment on the Notes of $7,486,192 was due on Oct. 1, 2011. The Company did not make that interest payment as scheduled and currently plans to make use of the thirty-day grace period provided by the indenture governing the Notes. Non- payment of interest on the scheduled due date is not an event of default under the Indenture unless the interest payment is not made within such thirty-day grace period. If the Company does not make the interest payment by Oct. 31, 2011, however, the trustee for the Notes would be permitted under the terms of the Indenture to accelerate the Borrower's obligation to repay the Notes by providing written notice of acceleration to the Borrower. If the Company fails to make that interest payment by Oct. 31, 2011, and the trustee for the Notes provides a written notice of acceleration, then any such acceleration under the Notes may also constitute an event of default under the terms of the indentures governing the Borrower's other outstanding senior notes. In addition, any such failure to make the scheduled interest payment by Oct. 31, 2011, may constitute a default under: (i) the terms of a Senior Secured Term Loan Agreement, dated Oct. 20, 2009, by and among the Company, ColFin WLH Funding, LLC, and the other lenders party thereto, pursuant to which the Lenders have advanced $206,000,000 to the Company as a term loan; and (ii) the terms of a Loan Agreement dated Feb. 14, 2006, by and between Circle G at the Church Farm North Joint Venture, LLC, and U.S. Bank National Association, successor to CalNational Bank, pursuant to which there is an aggregate principal amount of $8,999,150 outstanding as a term loan. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. The Company's balance sheet at June 30, 2011, showed $611.15 million in total assets, $610.25 million in total liabilities and $896,000 in equity. * * * William Lyon carries 'CCC' issuer credit ratings from Standard & Poor's. "S&P raised its rating on William Lyon Homes because S&P believes that near-term liquidity pressure has eased somewhat following the partial funding of a secured term loan and reduced maturing credit facility debt," said credit analyst James Fielding in November 2009 when S&P raised the rating on William Lyon to 'CCC' from 'CCC-'. He added, "However, this privately held homebuilder remains very highly leveraged and may face challenges repaying or refinancing intermediate-term debt maturities if its business prospects don't improve in the interim." Standard & Poor's Ratings Services raised its rating on William Lyon Homes' 10.75% senior unsecured notes due 2013 to 'CC' from 'D' after the company repurchased $10.5 million of outstanding principal for $9.0 million. S&P lowered its rating on the notes to 'D' because S&P considered the discounted repurchase to be tantamount to default under its criteria for exchange offers and similar restructurings. In accordance with its criteria, S&P is now raising its rating on these notes because the company completed its repurchase, and S&P is not aware of additional discounted repurchases at this time. As reported by the TCR on Sept. 6, 2011, Moody's Investors Service lowered the ratings of William Lyon Homes, including its corporate family and probability of default ratings to Ca from Caa2 and the ratings on its public senior unsecured notes to C from Caa3. The rating outlook is negative. These rating actions result from the company's recently missed interest payment of $2.92 million on its 7.5% senior unsecured notes due 2/15/2014. Moody's will attempt to determine the company's reasons for missing the coupon payment in light of its apparent availability of funds to make the payment and its plans to address what Moody's considers to be an untenable capital structure. WINDRUSH SCHOOL: Gets Court's Interim OK to Use Operating Case -------------------------------------------------------------- ElCerritoPatch reports that Judge William Lafferty granted interim approval on Oct. 4, 2011, to Windrush School to continue using its operating cash to run the school. Wells Fargo Bank claimed the funds were concealed collateral on an overdue loan. Judge Lafferty set a further hearing for Oct. 28, 2011, at 1:30 p.m. According to the report, Windrush said that if the 35-year-old school doesn't raise an additional $800,000 to $900,000 by this Friday it will have to close Oct. 28. If it does raise the funds, it can complete the school year, the trustees said. The total amount raised so far is $631,828, according to the school Web site. The amount stood at $575,650 on Monday, according the Windrush Development Director Ann Root. The report says the bank said the debt agreement established all school property and gross revenues as collateral for the $13 million that Windrush borrowed through a bond issue in 2007 to build its new library/middle school and refurbish the gym. The court has yet to rule on whether Windrush can remain under Chapter 11 protection, which allows it to continue operating without paying creditors if it convinces the court that it has a viable reorganization plan. Based in El Cerrito, California, Windrush School is a private K-8 school. The Company filed for Chapter 11 protection on Sept. 30, 2011 (Bankr. D. N.D. Calif. Case No. 11-70440). Judge William J. Lafferty presides over the case. Merle C. Meyers, Esq., at Meyers Law Group PC, represents the Debtor. The Debtor estimated both assets and debts of between $10 million and $50 million. YEHUD-MONOSSON USA: 8th Circ. Approves Forced Chapter 7 ------------------------------------------------------- Liz Hoffman at Bankruptcy Law360 reports that the Eighth Circuit on Wednesday affirmed the involuntary conversion of Yehud-Monosson USA Inc.'s bankruptcy to Chapter 7, ruling that the company's four previous filings under a different name were an abuse of the system. Law360 relates that the appeals court said Yehud-Monosson was substantially the same entity as Midwest Oil of Minnesota LLC, which has filed for bankruptcy four times in Delaware and Minnesota since 2009 in an attempt to stall foreclosures and circumvent a one-year filing ban. Yehud-Monosson USA, Inc., for bankruptcy protection (Bankr. D. New York Case No. 11-11278) on March 23, 2011. Rebekah M. Nett, Esq., at Westview Law Center, PLC, in St. Paul, MN, serve as the Debtor's counsel. The Company estimated its assets and debts at $1,000,001 to $10,000,000. ZAIS INVESTMENT: Anchorage Capital Amends Prepackaged Plan ---------------------------------------------------------- Anchorage Capital Master Offshore Ltd., Anchorage Illiquid Opportunities Offshore Master L.P., and GRF Master Fund L.P., filed a first amended prepackaged Chapter 11 plan of reorganization for Zais Investment Grade Limited VII on Sept. 23, 2011. Under the plan, on the Effective Date, the Plan Proponents will form NewCo as an exempted limited partnership organized under the laws of the Cayman Islands. On the Effective Date, the Debtor will transfer title to the Designated Assets to NewCo free and clear of all liens, Claims, Causes of Action, interests, security interests and other encumbrances without further order of the Bankruptcy Court. In exchange for the transfer of the assets, NewCo will transfer to the Debtor (i) on the Effective Date, the New LP Interest and (ii) on or after the Effective Date, cash sufficient to fund the Debtor's senior obligations under the Plan, but solely to the extent that the Debtor's Cash on the Effective Date and projected cash distributions from the New LP Interest are not sufficient to fund the obligations when due. From and after the Effective Date, NewCo's operation will be managed by the General Partner. The General Partner will delegate to the Investment Manager the authority to liquidate the designated assets and to distribute the corresponding proceeds pursuant to the Limited Partnership Agreement. On the Effective Date, the authority of the Debtor's directors, officers and administrator will be terminated. The Plan Administrator will succeed the Debtor's officers, directors, administrator and shareholders; provided that the Plan Administrator may continue to consult with the Debtor's directors and administrator to the extent required to comply with applicable law or other contractual provisions of the Debtor's or NewCo's documents. The reasonable fees and expenses of the Debtor and its directors and administrator incurred in connection with the consultation by the Plan Administrator will be paid by NewCo on terms agreed to by the Plan Administrator and the parties. On the Termination Date, the Debtor will be deemed dissolved and the Plan Administrator may take any actions required under applicable law to accomplish the dissolution of the Debtor. The classification and treatment of the claims under the plan are: A. Allowed Administrative Claims - Each holder of an Allowed Administrative Claim will receive (i) the amount of the holder's Allowed Administrative Claim in one Cash payment or (ii) other treatment as may be agreed upon in writing by the Plan Administrator and the holder. B. Allowed Tax Claims - Each holder of an Allowed Tax Claim will receive (i) the amount of the holder's Allowed Tax Claim in one cash payment, or (ii) other treatment as may be agreed upon in writing by the Plan Administrator and the holder. C. Class 1 (Senior Indenture Administrative Expense Claims) ? On each Quarterly Plan Distribution Date through the Termination Date, each holder of an Allowed Senior Indenture Administrative Expense Claim will receive Cash in the amount of the holder's Allowed Senior Indenture Administrative Expense Claim. D. Class 2 (Indenture Priority Claims) - Each holder of an Allowed Indenture Priority Claim shall receive the amount of the holder's Allowed Indenture Priority Claim, including any interest to which the holder is legally, contractually or equitably entitled in one Cash payment. E. Class 3 (Senior Note Claims) ? Each holder of an Allowed Senior Note Claim will receive its Pro Rata Share of available cash. F. Class 4 (Junior A-2 Note Claims) - Each holder of a Junior A-2 Note Claim is not entitled to any recovery under the Plan. G. Class 5 (Junior A-3 Note Claims) - Each holder of a Junior A-3 Note Claim will not receive any property under the Plan. H. Class 6 (Junior B-1 Note Claims) - Each holder of a Junior B-1 Note Claim will not receive any property under the Plan. I. Class 7 (Junior B-2 Note Claims) - Each holder of a Junior B-2 Note Claim will not receive any property under the Plan. J. Class 8 (Subordinated Claims) - Each holder of a Subordinated claim will not receive any property under the Plan. K. Class 9 (Income Note Claims) - Each holder of an Income Note Claim will not receive any property under the Plan. L. Class 10 (General Unsecured Claims) - Each holder of a General Unsecured Claim will not receive any property under the Plan. M. Class 11 (Old Equity Interests) - Each holder of an Old Equity Interest will not receive any property under the Plan. The plan proponents -- Anchorage Capital Master Offshore Ltd., Anchorage Illiquid Opportunities Offshore Master L.P., and GRF Master Fund L.P., are represented by: Gerard H. Uzzi, Esq. WHITE & CASE LLP 1155 Avenue of Americas New York, New York 10036-2787 Tel: (212) 819-8200 Fax: (212) 354-8113 E-mail: guzzi@whitecase.com Richard M. Meth, Esq. FOX ROTHSCIDLD LLP 75 Eisenhower Parkway, Suite 200 Roseland, New Jersey 07068 Tel: (973) 992-4800 Fax: (973) 992-9125 E-mail: rmeth@foxrothschild.com A copy of the first amended prepackaged plan is available for free at: http://bankrupt.com/misc/ZAIS_plan_amended.pdf U.S. Trustee Objects to Plan The U.S. Trustee objects to confirmation of the prepackaged Chapter 11 Plan of Reorganization for Zais Investment Grade Limited VII proposed by GRF Master Fund, L.P., Anchorage Illiquid Opportunities Offshore Master, L.P. And Anchorage Capital Master Offshore, Ltd., dated March 15, 2011. Mitchell Hausman, Esq., representing the U.S. Trustee, states that the Plan is not confirmable because it contains an overboard third party release and exculpation clause, both of which are contrary to applicable law in the Third Circuit. In addition, the Plan provides for the reimbursement of all reasonable fees and expenses of the Plan Proponents without providing a mechanism to determine the reasonableness of the fees and expenses. About Zais Investment Grade Limited Zais Investment Grade Limited VII is based in Grand Cayman. On April 1, 2011, Anchorage Capital Master Offshore, Ltd., GRF Master Fund, L.P., and Anchorage Illiquid Opportunities Offshore Masters, L.P. filed an involuntary Chapter 11 petition against Zais Investment Grade Limited VII. On April 26, 2011, the U.S. Bankruptcy Court for the District of New Jersey entered an order for relief under chapter 11 of the Bankruptcy Code. The Debtor tapped Wollmuth Maher & Deutsch LLP as general bankruptcy counsel, and Jones Day as special counsel. The Debtor disclosed $365,771,549 in liabilities in its schedules. ZOGENIX INC: Domain Partners Discloses 15.4% Equity Stake --------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Domain Partners VII, L.P., and its affiliates disclosed that they beneficially own 9,923,335 shares of common stock of Zogenix, Inc., representing 15.4% of the shares outstanding. The final prospectus filed with the SEC on Sept. 16, 2011, in connection with the Company's registered secondary offering of 30,000,000 shares of Common Stock reported that there would be 64,473,278 shares of Common Stock outstanding after the completion that offering. A full-text copy of the Schedule 13D is available for free at http://is.gd/4qFjIz About Zogenix Inc. Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and Emeryville, California, is a pharmaceutical company commercializing and developing products for the treatment of central nervous system disorders and pain. The Company's balance sheet at June 30, 2011, showed $51.4 million in total assets, $58.5 million in total liabilities, and a stockholders' deficit of $7.1 million. As reported in the TCR on March 8, 2011, Ernst & Young LLP, in San Diego, Calif., expressed substantial doubt about Zogenix's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that of the Company's recurring losses from operations and lack of sufficient working capital. * U.S. Supreme Court Won't Settle Split on Auto Loan Case --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that whether the so-called negative equity on a previously-owned auto must be paid in full as a condition to keeping the newer car after bankruptcy is an issue that won't be decided this year by the U.S. Supreme Court. According to the report, the high court in Washington decided on Oct. 3 not to resolve a split among the circuit courts of appeal. The U.S. Court of Appeals in San Francisco, departing from other eight circuits to consider the issue, ruled in July 2010 that negative equity on a previously owned auto is not part of a purchase money security interest and need not be paid to retain the newer auto. Mr. Rochelle discloses that over a dissent by four circuit judges, the entire Court of Appeals for the 9th Circuit in San Francisco decided earlier this year not to rehear the case. The dissenters argued that the majority on the circuit court interpreted the Bankruptcy Code "to mean the exact opposite of what the plain language says." The lender, who lost in the court of appeals, filed a petition in May for review by the Supreme Court. The auto-loan case in the Supreme Court is AmeriCredit Financial Services Inc. v. Penrod (In re Penrod), 10-1443, U.S. Supreme Court. The Circuit Court's July 2010 opinion is AmeriCredit Financial Services Inc. v. Penrod (In re Penrod), 08-60037, 9th U.S. Circuit Court of Appeals (San Francisco). The Supreme Court already accepted one bankruptcy case for the term that began this month. The case, called Hall v. U.S., involves the tax treatment of property sold after bankruptcy by family farmers in Chapter 12. * Homestead Limit Doesn't Make Judgment Enforceable --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a creditor with a pre-bankruptcy judgment lien doesn't automatically have a secured claim in proceeds from the sale of a homestead in excess of the homestead exemption, the U.S. Court of Appeals in New Orleans ruled on Oct. 4. The case involved an individual saddled with a pre-bankruptcy judgment for $538,000. The case is Smith v. HD Smith Wholesale Drug Co. (In re McCombs), 08-20171, U.S. 5th Circuit Court of Appeals (New Orleans). * False Invoice Not Equivalent to False Financials -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that an arbitration award didn't make the underlying debt automatically non-dischargeable under Section 522(a)(2)(B) of the Bankruptcy Code, according to a Sept. 30 opinion by U.S. District Judge Martin Reidinger from Asheville, North Carolina. An arbitrator made award against a contractor for issuing false invoices. The arbitrator found that the contractor's conduct amounted to "fraud and deceptive practices." The district judge ruled that the debt was dischargeable because it was based on the issuance of false invoices. The case is Green v. Bashor (In re Bashor), 10-195, U.S. District Court, Western District North Carolina (Asheville). * Oaktree Capital Nears Final Close for European Distress Fund --------------------------------------------------------------- Dow Jones' DBR Small Cap reports that Oaktree Capital Management, which is on the path to going public, is moving toward a final close on its European distressed strategy vehicle at the EUR3 billion ($4.02 billion) hard cap, according to people familiar with the situation. * Siguler Guff & Co Raises $1.3 Billion for Distressed Debt Fund --------------------------------------------------------------- Dow Jones' Daily Bankruptcy Review reports Siguler Guff & Co. held a final close on its fourth distressed-debt fund of funds at roughly $1.3 billion, said a person familiar with the situation. * SNR Denton Expands Bankruptcy Practice with Sam Alberts --------------------------------------------------------- SNR Denton announced October 4 that Sam Alberts has joined as a partner in its Restructuring and Insolvency practice in Washington, DC. "Sam is a respected restructuring lawyer, and his addition will enhance our bankruptcy practice and the firm. Throughout his career, he has established expertise in several key industries and sectors, including health care and finance," said Fruman Jacobson, chair of SNR Denton's Restructuring and Insolvency practice. "Sam's representation of government agencies and strong industry relationships will enable us to provide even more comprehensive client service in our Public Policy and Regulation practice and Government sector." Mr. Alberts joins the firm from Dickstein Shapiro LLP, where he was a partner. Mr. Alberts has significant experience in complex domestic and cross-border business and government-related restructurings and bankruptcies. He has represented debtors, creditors, committees, trustees, sovereigns, nongovernmental organizations, landlords and purchasers of distressed assets in all phases of reorganization. Alberts is an experienced litigator with trial experience in a variety of business related matters in state and federal courts. "I am eager to begin working with SNR Denton's first-class lawyers and professionals," said Alberts. "The firm's global platform and respected restructuring practice will improve the work I do for my clients." Mr. Alberts earned his J.D., with honors, from George Washington University and his B.A., cum laude, from New York University. Mr. Alberts complements a group of more than 70 new partners, counsel, principals and senior advisors who have joined SNR Denton worldwide since the combination that created the firm a year ago. * Akin Gump Grabs Haynes and Boone Pro for Texas Office ------------------------------------------------------- Brian Antweil has joined Akin Gump Strauss Hauer & Feld LLP's Houston office as a partner in its litigation and alternative dispute resolution practice. Previously, Mr. Antweil was a partner in the Houston office of a mid-sized, international law firm where he led the firm's Business Litigation South Practice Group. A seasoned trial lawyer, Mr. Antweil is also an experienced business advisor and a former business executive. He represents clients in diverse industries in a wide array of commercial disputes. "We're very excited to welcome Brian to our team," stated Stephen Baldini, head of Akin Gump's litigation practice. "His extensive trial experience coupled with his business background allows Brian to provide a unique perspective that our clients will find very valuable." Added Christine LaFollette, partner-in-charge of Akin Gump's Houston office, "I'm thrilled to welcome Brian to our office. The addition of such a talented trial lawyer and dynamic person will be a tremendous benefit to our clients, both in Houston and across the firm." Mr. Antweil represents clients in a full range of business, commercial and tort cases in state and federal courts and domestic and international arbitrations. He has significant experience in oil and gas, bankruptcy and insolvency litigation, energy, insurance coverage, technology and intellectual property disputes. "I'm eager for the opportunity to bring my practice to Akin Gump, and look forward to helping the firm continue to grow its litigation practice in Houston," remarked Mr. Antweil. Mr. Antweil is a frequent speaker and writer, and is an adjunct professor at the University of Houston Law Center, where he has taught Trial Advocacy for almost a decade. He is also an instrument-rated private pilot who flies missions for and serves on the board of directors of the nonprofit charitable organization Angel Flight. Mr. Antweil received his J.D. from the University of Houston Law Center in 1990, where he was a member of the Order of the Barons. He received his B.B.A. in finance from the University of Texas at Austin in 1977. He is licensed to practice in Texas and New York. * BOOK REVIEW: Legal Aspects of Health Care Reimbursement --------------------------------------------------------- Authors: Robert J. Buchanan, Ph.D., and James D. Minor, J.D. Publisher: Beard Books Softcover: 300 pages List Price: $34.95 Review by Henry Berry With Legal Aspects of Health Care Reimbursement, Buchanan, a professor in the School of Public Health at Texas A&M, and Minor, an attorney, have come up with an invaluable resource for lawyers and anyone else seeking an introduction to the legal and social issues related to Medicare and Medicaid. The administrative costs of Medicare and Medicaid reimbursement have been a heated topic of debate among public officials and administrators of provider healthcare organizations, especially health maintenance organizations. Although inflation and the use of costly medical technology are key factors in the rise in Medicare and Medicaid costs, some control can be gained through appropriate compliance, using more efficient procedures and better detection of fraud. This work is a major guide on how to go about doing this. Though mostly a legal treatise, Legal Aspects of Health Care Reimbursement, first published in 1985, also offers commentary through legislative and regulatory analyses, thereby explaining how healthcare reimbursement policies affect the solvency and effectiveness of the Medicare and Medicaid programs. In discussing how legislation and regulations affect the solvency and effectiveness of government-provided healthcare, the authors offer insight into the much-publicized and much-discussed issue of runaway healthcare costs. Buchanan and Minor do not deny that healthcare costs are out of control and are onerous for the government and ruinous for many individuals. But healthcare reimbursement policies are not the cause of this, the authors argue. To make their case, they explain how the laws and regulations in different areas of the Medicare and Medicaid programs create processes that are largely invisible to the public, but make the programs difficult to manage financially. The processes are not well thought out nor subject to much quality control, with the result that fraud is chronic and considerable. The areas of Medicare covered in the book are inpatient hospital reimbursement, long-term care, hospice care, and end-stage renal disease. The areas of Medicaid covered are inpatient hospital and long-term care plus abortion and family planning services. For each of these areas, the authors discuss the conditions for receiving reimbursement, the legislation and regulations regarding reimbursement, the procedures for being reimbursed, the major areas of reimbursement (for example, capital-related costs, dietetic services, rental expenses); and court cases, including appeals. Reimbursement practices of selected states are covered. For each of the major areas of interest, the chapters are organized in a manner that is similar to that found in reference books and professional journals for attorneys and accountants. Laws and regulations are summarized and occasionally quoted with expert background and commentary supplied by the authors. With regard to court cases and rulings pertaining to Medicare and Medicaid, passages from court papers are quoted, references to legal records are supplied, and analysis is provided. Though the text delves into legal issues, it is accessible to administrators and other lay readers who have an interest in the subject matter. Clear chapter and subchapter titles, a table of cases following the text, and a detailed index enable readers to use this work as a reference. The value of this book is reflected in the authors' ability to distill great amounts of data down to one readable text. It condenses libraries of government and legal documents into a single work. Answers to questions of fundamental importance to healthcare providers -- those dealing with qualifications, compliance, reimbursable costs, and appeals -- can be found in one place. Timely reimbursement depends on proper application of the rules, which is necessary for a provider's sound financial standing. But the authors specify other reasons for writing this book, to wit: "Providers should have a general knowledge of the law and should not rely on manuals and regulations exclusively." By summarizing, commenting on, and citing cases relating to principal provisions of Medicare and Medicaid, the authors accomplish this objective. The authors also cover the topic of fraud with respect to both Medicare and Medicaid, offering both a legal treatment and commentary. At the end of each chapter is a section titled "Outlook," which contains a discussion of government studies, changes in healthcare policy, or other developments that could affect reimbursement. Although this work was published over two decades ago, much of this discussion is still relevant today. Finally, the book is a call for change. The authors remark in their closing paragraph: "Given the increasing for-profit orientation of the major segments of the health care industry, proprietary providers should be particularly responsive to new efficiency incentives" in reimbursement. In relation to this, "policymakers [should] develop reimbursement methods that will encourage providers to become more efficient." Robert J. Buchanan is currently a professor in the Department of Health Policy and Management in the School of Rural Public Health at the Texas A&M University System Health Sciences Center. James D. Minor, a former law professor at the University of Mississippi, has his own law practice. ********* 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, 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 ***