/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/111010.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, October 10, 2011, Vol. 15, No. 281 Headlines ACCESS INSURANCE: Files Schedules of Assets and Liabilities ADVOCACY & RESOURCES: Loses Bid to Reverse USDA Suspension AMERICAN NATURAL: To Elect Directors by Plurality of Votes AMERICAS INSURANCE: A.M. Best Downgrades FSR to 'C+' AMR CORP: American Reports 81.4 Percent Load Factor in September ARCADIA RESOURCES: PrairieStone in Forbearance Talks With HD Smith ASHAPURA MINECHEM: Injunction Hearing on Oct. 17 B & R CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors GAYLER FAMILY: Case Summary & 2 Largest Unsecured Creditors BANCO INTERACCIONES: Moody's Lowers Deposit Ratings to 'Ba2' BARNWELL COUNTY: Chapter 9 Case Summary & Creditors List BEAR ISLAND: Wins Court OK to Send Liquidation Plan to Creditors BERNARD L MADOFF: Greiff Victory Could Spur Dismissal of Suits BERNARD L MADOFF: Trustee Wants $47-Mil. From ABN Amro, Nomura BERNARD L MADOFF: Judge Approves Feeders' Ch. 11 Plans BION ENVIRONMENTAL: Testing Program Initiated at Kreider Farms BION ENVIRONMENTAL: Holders Convert Pref. Stock to Common Stock BLOCKBUSTER INC: Moves to Block Brazil Retailer From Using Name BLUE HERON: Deadline for Bids on Two Sites Extended to Dec. 4 BLUEKNIGHT ENERGY: Obtains Final OK of Class Action Settlement BOMBARDIER INC: DBRS Confirms Issuer Rating at 'BB' CALPINE CORP: S&P Raises Corporate Credit Rating to 'B+' CAPMARK FIN'L: Emerges From Ch. 11, Releases Funds for Creditors CASCADES INC: DBRS Confirms Issuer Rating at 'BB' CCFC FINANCE: S&P Raises Rating on $1-Bil. Bank Note to 'BB' CDC CORP: Files for Chapter 11 Bankruptcy Protection CENTRAL BUILDING: Wants to Use KeyBank Cash Collateral CENTRAL BUILDING: Sec. 341 Creditors' Meeting Set for Nov. 8 CHINA DU KANG: Files Form 10 with SEC; Registers Common Shares CHURCH & DWIGHT: S&P Withdraws 'BB+' Rating on $250-Mil. Notes CITIZENS REPUBLIC: M. Champion Elected by U.S. Treasury to Board CLEAN BURN: Employs Dough Davis as Auctioneer CLINTON COURT: Case Summary & 20 Largest Unsecured Creditors COMPASS DIVERSIFIED: Moody's Rates $275MM Credit Facility at 'Ba1' CRAWFORD FURNITURE: Closes All Five Retail Stores CRYOPORT INC: To Offer 2.3MM Common Shares Under Incentive Plan CRYSTAL CATHEDRAL: Founder Fights Suit Lodged by Committee CYBERDEFENDER CORP: Guthy-Renker Discloses 40.6% Equity Stake DENBURY RESOURCES: Moody's Affirms 'Ba3' Corporate Family Rating DEX ONE: Moody's Downgrades Corporate Family Rating to 'B3' DK AGGREGATES: Has Until Oct. 17 to File Amended Plan Outline DONSON GROUP: Case Summary & 4 Largest Unsecured Creditors DRYSHIPS INC: Adjusts Conversion Price of Convertible Notes DUARTE, CALIF: S&P Lowers Rating on Series 1997A Bonds to 'BB' DUNE ENERGY: Enters Into Restructuring Plan Support Agreement DUNKIN' BRANDS: S&P Raises Corporate Credit Rating to 'B+' DUTCH RESOURCES: Signs Mining Lease Pact with Bilbray & Johnston EDWARD DEETS: Voluntary Chapter 11 Case Summary ELEPHANT TALK: Del. State Secretary Favors Certificate of Merger EMMIS COMMUNICATIONS: Extends P. Walsh's Employment to 2013 ENER1 INC: Charles Gassenheimer Resigns as Director ENER1 INC: Pomerantz Reminds Shareholders of Oct. 17 Deadline EVERGREEN ENERGY: Receives $30-Mil. Offer for K-Fuel Business EVERGREEN ENERGY: Ilyas Khan Discloses 6.6% Equity Stake EVERGREEN SOLAR: Faces Delisting From Nasdaq Stock Market FORD MOTOR: Moody's Reviews Ba2 Corp. Family Rating for Upgrade FRC LLC: Files for Chapter 11 Bankruptcy Protection FRIENDLY ICE CREAM: Obtains Approval of $50.6-Mil. Interim Loan GARY PHILLIPS: Can Use Creditors' Cash Collateral Until Dec. 16 GARY PHILLIPS: Wants TruPoint Bank DIP Loan Extended Until 2013 GLOBAL CROSSING: STT Crossing's Equity Stake Down to 0% GREENWICH SENTRY: Judge Approves Chapter 11 Plans GREENWOOD RACING: Moody's Confirms 'B2' Corporate Family Rating GUIDED THERAPEUTICS: LuViva Under Review by UK's NHS Diagnostics HALO COMPANIES: Tony Chron Resigns as President HENDEE ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors HIGHLANDS GROUP: Case Summary & Largest Unsecured Creditor LAND DEVELOPMENT: Voluntary Chapter 11 Case Summary HOLDINGS OF EVANS: Amends List of Largest Unsecured Creditors HOLDINGS OF EVANS: Files Schedules of Assets and Liabilities HOLDINGS OF EVANS: U.S. Trustee Unable to Form Committee HOVENSA LLC: S&P Keeps 'B' Secured Debt Rating; Outlook Negative HOVNANIAN ENTERPRISES: Fitch Puts 'CCC' IDR on Watch Negative HOVNANIAN ENTERPRISES: S&P Lowers Corp. Credit Rating to 'CC' HUDSON HEALTHCARE: Hoboken Univ Creditors Strike Sale Settlement INNER CITY: Senior Lenders Object to Rothschild's Success Fee INNKEEPERS USA: Creditors to Join Trial Over $1.12BB Hotel Deal INTERNATIONAL RARITIES: Panel, Trustee Object to Plan Outline JELD-WEN INC: S&P Assigns 'B' Corporate Credit Rating JMG ACQUISITION: Voluntary Chapter 11 Case Summary JMR DEVELOPMENT: Hires Luis R. Carrasquillo as Accountant JMR DEVELOPMENT: Taps Charles A. Cuprill as Bankruptcy Attorney KEYUAN PETROCHEMICALS: Receives NASDAQ Delisting Notice KINGSWAY FINANCIAL: A.M. Best Cuts Issuer Credit Ratings to 'C' LEE WILLIAMS: Case Summary & 8 Largest Unsecured Creditors LEVEL 3: To Assume Outstanding Awards Under Global Crossing Plan LEVEL 3: STT Crossing Discloses 24.8% Equity Stake LOCATION BASED TECH: Presents at Craig-Hallum Annual Conference LODGENET INTERACTIVE: David Bankers Resigns from All Positions LOUISIANA HOUSING: S&P Lowers Rating on Revenue Bonds to 'B-' M WAIKIKI: Seeks Court Approval to Hire Neligan Foley as Counsel M WAIKIKI: Seeks Nod to Tap Klevansky Piper as General Counsel MANISTIQUE PAPERS: Taps Godfrey & Kahn as Lead Counsel MANISTIQUE PAPERS: Hires Morris Nichols as Delaware Co-counsel MARKET STREET: Court OKs Morphy Makofsky as Consulting Engineers MARKET STREET: Court OKs James Fitzmorris as Political Consultant MARRIOTT VACATIONS: S&P Assigns Prelim. BB- Corp. Credit Rating MOORE SORRENTO: Court Approves Forshey & Prostok as Counsel MT. MORRIS MUTUAL: A.M. Best Cuts Financial Strength Rating to 'B' NALIKA INC: Voluntary Chapter 11 Case Summary NEW HOLLAND: Files for Bankruptcy; Must File Plan By January 2012 NEW JERSEY MOTORSPORTS: Emerges From Chapter 11 Protection NEW LEAF: Recasts $606,381 in Existing Secured Loans NEXTMART INC: AuKeSaSi Beijing Acquires 100% of BGCC NORTHCORE TECHNOLOGIES: Renews Contract of Enterprise Client OKLAHOMA FARM: A.M. Best Cuts Financial Strength Rating to 'B-' OPEN RANGE: Files for Chapter 11 to Sell or Liquidate OPEN RANGE: Case Summary & 30 Largest Unsecured Creditors OPTIMUMBANK HOLDINGS: Issuance of 37.5MM Common Shares Approved ORAGENICS INC: Committee Awards Options to Buy 195,700 Shares OTERO COUNTY: Court Approves John D. Wheeler as Bankruptcy Counsel OTERO COUNTY: Bankruptcy Court OKs White & Case as Lead Counsel PARTNERS MUTUAL: A.M. BEST Downgrades FSR to 'C++' PAT IONADI: Case Summary & 20 Largest Unsecured Creditors PENINSULA HOSPITAL: Court Names McMurray as Patient Care Ombudsman PENN NATIONAL: S&P Raises Rating on Subordinated Debt to 'BB' PHILADELPHIA ORCHESTRA: Nears to Reaching Deal With Labor PILGRIM'S PRIDE: Manipulated Chicken Prices, Ordered to Pay $26MM PITT PENN: Thomas Alexander Gets OK to Withdraw as Special Counsel PITTSBURGH CORNING: Has Until Oct. 10 to Adjust Plan Language PORTER DEVELOPMENT: Voluntary Chapter 11 Case Summary POINT BLANK: Approved to Auction Business on Oct. 27 PROTECTIVE LIFE: Fitch Affirms 'BB+' Trust Preferred Rating QUALTEQ INC: Can Employ Fox Rothschild as Co-Counsel QUANTUM FUEL: Repays May 2011 Bridge Notes in Full QUANTUM FUEL: Sells $1.95 million of 10% Convertible Notes REAL MEX: S&P Cuts Corp. Credit Rating to D After Ch. 11 Filing ROBINO-BAY COURT: Creditor Wants Chapter 11 Case Dismissed REALOGY CORP: To Report $30 Million Net Loss in Third Quarter REALTY FINANCE: Board Mulls Chapter 7 Liquidation RITE AID: Files Form 10-Q, Incurs $92.2MM Loss in Aug. 27 Quarter RIVERBANK OF WYOMING: Closed; Central Bank Assumes Deposits ROCHA DAIRY: Can Use Cash Collateral Through Confirmation of Plan S-SI SAN JUAN: Case Summary & 10 Largest Unsecured Creditors SAGAMORE PARTNERS: Case Summary & 20 Largest Unsecured Creditors SBARRO INC: Files "Improved Version" of Ch. 11 Exit Plan SOLYNDRA INC: Energy Department Loan Official Resigns SOUTH EDGE: New Inspirada Settlement Opens Door for Confirmation SPANISH BROADCASTING: Marko Radlovic Resigns as CRO & Gen. Mngr. STEAK N SHAKE: S&P Assigns 'B+' Corporate Credit Rating STERLING FINANCIAL: Fitch Withdraws 'B' LT Issuer Default Rating STILLWATER MINING: Moody's Withdraws B2 Rating on $300MM Notes SUMMIT III: Notifies on Change of Address SUN SECURITY BANK: Closed; Great Southern Bank Assumes Deposits SUNRISE REAL ESTATE: Issues 2.5MM Shares to Better Time SUPERMEDIA INC: Moody's Lowers CFR to Caa1; Outlook Negative TH PROPERTIES: U.S. Trustee Seeks Chapter 7 Conversion THOMASTON HOUSING: S&P Lowers Rating on Revenue Bonds to 'BB-' TOWNSENDS INC: Wins Court Nod to Convert Bankruptcy to Chapter 7 TTC PLAZA: Capital One Wants to Proceed With Foreclosure TTC PLAZA: Status Conference Scheduled for Nov. 8 TTC PLAZA: Sec. 341 Creditors' Meeting Set for Nov. 8 UNITED AUTOMOBILE: A.M. Best Upgrades FSR to 'C++' WASHINGTON MUTUAL: Blocked From Holding Quick Confirmation Hearing WASHINGTON MUTUAL: Judge Denies Bid to Limit Mediation WASHINGTON MUTUAL: Creditors Seek Probe of Trading Decision WASHINGTON MUTUAL: Confirms Release of Securities Tendered WASTEQUIP INC: Working to Refinance Debt as Maturities Approach WORLD SURVEILLANCE: Files Form S-8; Registers 63.9-Mil. Shares YELLOWSTONE MOUNTAIN: Federal Judge Dismisses Firm's Appeal * 2011 Global Corp Default Tally Increases to 32 * Slowing Economy Poses Risks to 3 Most Stressed Sectors * Missouri and Minnesota Banks Shuttered; Year's Failures Now 76 * Insurer Must Pay Bankrupt Manufacturer's Asbestos Claims * Avenue Holds Second Close on European Distress Fund * BOND PRICING -- For Week From Oct. 3 to Oct. 7, 2011 ********* ACCESS INSURANCE: Files Schedules of Assets and Liabilities ----------------------------------------------------------- Access Insurance Services, Inc., filed with the U.S. Bankruptcy Court for the District of Nevada its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $450,335 B. Personal Property $5,987,710 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $0 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $10,192,863 ----------- ----------- TOTAL $6,438,046 $10,192,863 Access Insurance Services, Inc., in Reno, Nevada, filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case No. 11-52830) on Sept. 1, 2011. Judge Bruce T. Beesley presides over the case. Stephen R. Harris, Esq., at Harris - Petroni, Ltd., serves as counsel to the Debtor. The petition was signed by Jeffrey P. Shaffer, director. ADVOCACY & RESOURCES: Loses Bid to Reverse USDA Suspension ---------------------------------------------------------- Lisa Uhlman at Bankruptcy Law360 reports that Advocacy & Resources Corp., which claims the U.S. Department of Agriculture unfairly suspended it over the actions of its bankruptcy trustee, lost a bid in Tennessee federal court Thursday to bar the suspension. Advocacy & Resources -- which says it mostly employs disabled workers who would have trouble finding jobs elsewhere -- claims in its Sept. 14 suit that the USDA essentially shut down its business by issuing the May suspension, which caused it to lose 85% of its revenue, Law360 relates. About Advocacy & Resources Based in Cookeville, Tennessee, Advocacy and Resources Corporation is a non-profit corporation that manufactured food products for feeding programs operated by the U.S. Government. Customers included the U.S. Department of Agriculture, the Department of Defense, and other private distribution firms. The Company filed for Chapter 11 protection (Bankr. M.D. Tenn. Case No. 06-03067) on June 20, 2006. Michael E. Collins, Esq., serves as Chapter 11 Trustee. Manier & Herod PC represents Mr. Collins. When the Debtor filed for chapter 11 protection, it estimated assets and debts between $10 million and $50 million. AMERICAN NATURAL: To Elect Directors by Plurality of Votes ---------------------------------------------------------- The board of directors of American Natural Energy Corporation amended Section 2 of Article II of the Company's by-laws, effective as of Oct. 3, 2011, to explicitly provide for the election of the Board of Directors by plurality vote. Prior to this amendment, the by-laws provided for the election of the Board of Directors by majority vote. The full text of the Company's By- laws, as amended, is available for free at http://is.gd/d4P6GD About American Natural American Natural Energy Corporation (TSX Venture: ANR.U) is a Tulsa, Oklahoma-based independent exploration and production company with operations in St. Charles Parish, Louisiana. The Company's balance sheet at June 30, 2011, showed $16.98 million in total assets, $9.29 million in total liabilities, and $7.69 million in total stockholders' equity. The Company reported a net loss of $2.06 million on $2.57 million of revenue for the year ended Dec. 31, 2010, compared with net income of $23.95 million on $1.08 million of revenue during the prior year. As reported by the TCR on April 5, 2011, MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company incurred a net loss in 2010 and has a working capital deficiency and an accumulated deficit at Dec. 31, 2010. AMERICAS INSURANCE: A.M. Best Downgrades FSR to 'C+' ---------------------------------------------------- A.M. Best Co. has downgraded the financial strength rating to C+ (Marginal) from B (Fair) and issuer credit rating to "b-" from "bb" of Americas Insurance Company (Americas) (New Orleans, LA). Both ratings have been removed from under review with negative implications and assigned a negative outlook. Subsequently, A.M. Best has withdrawn both ratings due to the company's request to no longer participate in A.M. Best's interactive rating process. The ratings for Americas were placed under review on August 31, 2010 pending the approval of new ownership. On January 31, 2011, Assure Holdings Corporation acquired Americas, but the ratings remained under review pending a full evaluation by A.M. Best of Americas' revised business plan and capital management strategies. The downgrades are primarily related to Americas' significant surplus decline, driven by start-up expenses and changes in non- admitted assets, as well as the one time charges for the write off of electronic data processing equipment and software, resulting in a considerably lower risk-adjusted capitalization for the company. The ratings further reflect Americas' poor operating performance, and in addition, premium growth has outpaced organic surplus growth. Partially offsetting these negative rating factors are Americas' planned and implemented corrective actions, which include significant cost cutting initiatives, improved information technology systems, which result in both better risk selection and ease of doing business. Furthermore, the company has improved its reinsurance coverages and management is exploring capital enhancement strategies. AMR CORP: American Reports 81.4 Percent Load Factor in September ---------------------------------------------------------------- American Airlines reported a September load factor of 81.4 percent, an increase of 1.3 points versus the same period last year. Traffic increased 1.9 percent on a capacity increase of 0.3 percent year-over-year. Domestic traffic increased 1.7 percent year-over-year on 1.1 percent less capacity, resulting in an increase in domestic load factor of 2.3 points versus September of last year. International traffic increased by 2.2 percent relative to last year, as capacity increased by 2.4 percent, resulting in an international load factor 0.2 points lower versus the same period last year. American boarded 6.8 million passengers in September. A detailed traffic and capacity report is available for free at: http://is.gd/bEqq4Q About AMR Corp. 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. ARCADIA RESOURCES: PrairieStone in Forbearance Talks With HD Smith ------------------------------------------------------------------ PrairieStone Pharmacy, LLC, a limited liability company whose member interests are owned by Arcadia Resources, Inc., is a party to a Line of Credit and Security Agreement with H.D. Smith Wholesale Drug Co. dated as of April 23, 2010. As of Sept. 29, 2011, PrairieStone had outstanding borrowings under the HD Smith LOC Agreement of $4.8 million, which borrowings are subject to the Line of Credit Note. The HD Smith Indebtedness is guaranteed by Arcadia pursuant to the Unlimited Continuing Guaranty made by Arcadia dated April 23, 2010. By letter dated Sept. 29, 2011, HD Smith notified PrairieStone that PrairieStone is in default of its obligations under the HD Smith Loan Documents. HD Smith notified PrairieStone that, as a result, HD Smith had elected to declare PrairieStone in default and enforce its rights and remedies under the HD Smith Loan Documents. HD Smith further notified PrairieStone that it was accelerating all amounts owed by PrairieStone under the Loan Documents and demanded immediate payment of the HD Smith Indebtedness, plus accruing interest and the costs of enforcing its rights under the Loan Documents. HD Smith further demanded if PrairieStone failed to immediately pay the HD Smith Payment Demand that PrairieStone immediately surrender to HD Smith all Collateral and cash proceeds therefrom. HD Smith further demanded that the Company make immediate and full payment of the HD Smith Payment Demand pursuant to the Guaranty. Arcadia and PrairieStone are in continuing discussions with HD Smith regarding payment of the HD Smith Indebtedness and their response to the HD Smith Payment Demand. PrairieStone and Arcadia are considering their options for responding to the HD Smith Default Notice. HD Smith, PrairieStone and Arcadia are currently negotiating the terms of a forbearance agreement and Arcadia anticipates that the parties will enter into such an agreement in the near future. Under the forbearance agreement HD Smith would agree to forbear from enforcing its rights under the HD Smith Loan Documents for a limited period of time, subject to Arcadia and PrairieStone agreeing to certain undertakings during the forbearance period. There can be no assurance, however, as to the outcome of the negotiations between Arcadia, PrairieStone and HD Smith with respect to a forbearance agreement. About Arcadia HealthCare Arcadia HealthCare is a service mark of Arcadia Resources, Inc. (nyse amex:KAD), and is a leading provider of home care, medical staffing and pharmacy services under its proprietary DailyMed program. The Company, headquartered in Indianapolis, Indiana, has 65 locations in 18 states. Arcadia HealthCare's comprehensive solutions and business strategies support the Company's vision of "Keeping People at Home and Healthier Longer." The Company's balance sheet at June 30, 2011, showed $25.85 million in total assets, $48.57 million in total liabilities, and a $22.72 million total stockholders' deficit. The Company reported a net loss of $14.35 million on $100.04 million of revenues for the fiscal year ended March 31, 2011, compared with a net loss of $31.09 million on $98.08 million of revenues for the fiscal year ended March 31, 2010. BDO USA, LLP, in Troy, Michigan, expressed substantial doubt about Arcadia Resources' ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and has a net capital deficiency. ASHAPURA MINECHEM: Injunction Hearing on Oct. 17 ------------------------------------------------ At the behest of Chetan Shah, the foreign representative of Ashapura Minechem Ltd., Judge James M. Peck will hold a hearing in U.S. Bankruptcy Court on Oct. 17, at 2:00 p.m., why a preliminary injunction should not be granted: (a) enjoining (i) all persons and entities from commencing or continuing any legal proceeding in the U.S. against the Company or against its assets or proceeds; and (ii) enforcement of any judgment, assessment or order or arbitration award against the Company or its assets or proceeds, and (iii) commencement or continuation of any action to create, perfect or enforce any lien, setoff or other claim against the Company or against any of its assets or proceeds; and (b) enjoining the continuation of pending U.S. litigation, including any discovery, against the Company or against its assets or proceeds. Pending the Oct. 17 Hearing, all persons and entities are enjoined from continuing or commencing any action or enforcing any judgment, assessment or order or arbitration award against the Company or its assets. Judge Peck will hold another hearing on Nov. 17, 2011, at 2:00 p.m. in Manhattan to consider the request of Chetan Shah for entry of an order recognizing Ashapura?s financial restructuring in India before the Board for Industrial and Financial Reconstruction as a foreign main proceeding pursuant to Bankruptcy Code sections 1515, 1517, 1520 and 1521. Ashapura Minechem is subject to a pending bankruptcy proceeding under the Sick Industrial Companies (Special Provisions) Act, 1985, in India. Ashapura is presently facing litigation on U.S. soil, including: -- Eitzen Bulk A/S v. Ashapura, No. 08 Civ. 8319 (AKH) (S.D.N.Y.); -- Eitzen Bulk A/S v. State Bank of India, No. 09 Civ. 10118 (AKH) (S.D.N.Y.); -- Eitzen Bulk A/S v. Standard Chartered Bank, No. 10 Civ. 7466 (AKH) (S.D.N.Y.); -- Armada (Singapore) PTE Ltd. v. Ashapura, No. 10 Civ. 4856 (CM) (S.D.N.Y.); -- Armada (Singapore) PTE Ltd. v. Ashapura, No. 10 Civ. 5509 (EEB) (N.D. Ill.); -- AMCOL Int?l Corp. v. Armada (Singapore) PTE Ltd., No. 11 Civ. 4888 (JBZ) (N.D. Ill.); and -- Eitzen Bulk A/S v. Ashapura, No. 2011-L-050170 (Ill. Cir. Ct. Cook County) Three foreign creditors have obtained London arbitration awards against Ashapura, totaling in excess of $125 million. Two of the creditors -- shipping companies Eitzen and Armada -- are currently active in pursuing enforcement of their arbitration awards in the United States, specifically in New York and Illinois. In New York, Eitzen has obtained attachment and garnishment orders against Ashapura?s assets and a judgment against Ashapura in excess of $36 million. Eitzen is actively seeking the involuntary transfer to New York of Ashapura?s non-U.S. bank deposits for the purpose of satisfying Eitzen?s New York judgment. In addition, Armada has obtained a New York judgment against Ashapura in excess of $70 million (inclusive of interest). In Illinois, both Eitzen and Armada have obtained attachment orders and judgments against Ashapura and both creditors are targeting assets belonging to Ashapura, in the amount of $687,356.52, that are in the possession of an Ashapura shareholder and trading partner, AMCOL, and two of AMCOL?s subsidiaries. The assets, in the nature of excess stock proceeds, were found by the U.S. District Court in the Northern District of Illinois to be property belonging to Ashapura. The foreign representative has said there is an imminent danger that the $687,356.52 will be executed upon by Armada by Oct. 7, 2011, the date set for a ruling by the Illinois federal court on Eitzen?s motion to intervene in Armada?s action against Ashapura. The foreign representative has told the U.S. Bankruptcy Court that the requested provisional relief is necessary to prevent a piecemeal dismantling of Ashapura?s estate. Armada itself has filed for bankruptcy protection in Singapore and a recognition proceeding under Chapter 15 of the Bankruptcy Code in the United Bankruptcy Court for the Southern District Court, In re Armada (Singapore) PTE Ltd., 09-10105 (JMP) (Bankr. S.D.N.Y.). Over the course of the past few years, Ashapura, like many other entities in a variety of industries throughout the world, has faced significant challenges. The worldwide recession that has taken hold over the past three years has created an environment of economic distress for companies and individuals alike, and that environment has impacted. Ashapura?s operations have been impacted over the past three years by a dramatic increase in bauxite orders accompanied by difficulties in exporting the bauxite, significant foreign exchange losses in connection with derivative transactions that it had entered into with Indian banks to hedge against foreign exchange risks spiraling freight costs and a rise in aluminum and commodity prices. In the conduct of its business, Ashapura entered into Contracts of Affreightment -- COAs -- with three shipping companies IHX (UK) Ltd., Eitzen and Armada. After execution of the COAs, however, the Government of Gujarat, India, placed an indirect embargo upon the export of bauxite mined in the State of Gujarat. As a result, it became impossible for Ashapura to export under the COAs. Simultaneously, Ashapura was informed by its agents that the Indian customs authorities had demanded its license granted by the Director General of Shipping to call vessels for loading purposes. Thus, although Ashapura was willing to perform under the COAs, it was compelled to declare the COAs frustrated on the grounds of force majeure. The Shipping Companies sought and obtained arbitration awards against Ashapura in London totaling over $125 million. Eitzen obtained an award in the amount of $36 million on May 26, 2009, IHX obtained an award in the amount of $24 million on July 8, 2009, and Armada obtained two awards totaling $65 million on Feb. 16, 2010. Ashapura did not participate in the arbitration proceedings, believing the COAs to be void ab initio as not conforming to the rules and registration formalities of maritime contracts in India. After the arbitration damage claims were awarded to the Shipping Companies, Ashapura initiated proceedings before the Civil Court in Jamkhambaliya, Gujarat, contending that the awards were against Indian public policy. The Shipping Companies countered by commencing proceedings before the Bombay High Court. Ashapura is obliged under secured working capital loans from Bank of India, Union Bank of India, AXIS Bank, EXIM Bank, DBS, HSBC and HDFC in the aggregate amount of roughly $62.5 million as of March 31, 2011. In addition, Ashapura is obligated under secured term loans from Union Bank of India, EXIM Bank and Federal Bank in the aggregate amount of an additional $7.5 million as of March 31, 2011, resulting in aggregate secured debt of roughly $70 million. This debt is secured by substantially all of Ashapura?s assets. The security interest in Ashapura?s assets includes deposit accounts in Ashapura?s name at various banks including Bank of India. Ashapura also is obligated to general unsecured creditors in the amount of roughly $154 million, of which nearly $26 million represents obligations owed to trade creditors, $125 million represent judgments obtained by the Shipping Companies and roughly $2.4 million represent intercompany loans. To preserve its value as a going concern and maximize the value of its assets for the benefit of all creditors, on May 31, 2011, Ashapura voluntarily filed a reference petition before the BIFR to restructure its financial affairs under the Sick Industrial Companies (Special Provisions) Act, 1985. Following the reference commencing the Indian Proceeding, the case was registered by the BIFR as Case No. 34/2011, which came for preliminary hearing on July 25, 2011. After registration of the case, an inquiry under section 16(1) of SICA is deemed to commence. That inquiry currently is in progress. The secured creditors and bankers have been directed to file their reply and objections to the case, which is now scheduled for hearing on Nov. 2, 2011. Once the inquiry is completed and the BIFR is satisfied under section 17(1) of SICA that the company has become a sick industrial company, the BIFR determines whether it is practicable for the company to make its net worth exceed the accumulated losses within a reasonable time. If the BIFR determines that it is not practicable for Ashapura to cause its net worth to exceed its accumulated losses within a reasonable time, the BIFR may order the preparation and sanctioning of a scheme for the financial reconstruction or, alternatively, a winding up. While the BIFR inquiry is pending, or a scheme is in preparation or being sanctioned and implemented, the SICA imposes a stay that prevents further proceedings to wind up the company, execution against the property of the company, appointment of a receiver, suits for recovery of money and enforcement actions, without the consent of the BIFR or the Indian appellate court. The actions to be undertaken in the Indian Proceeding are expected to achieve a significant restructuring of Ashapura?s business. Ashapura anticipates that it will emerge from this process a stronger, more competitive company. About Ashapura Ashapura Minechem Ltd. is an industrial company incorporated under the provisions of the Companies Act 1956, having its registered office in Mumbai, India. It is listed with the Bombay Stock Exchange and National Stock Exchange of India, Ltd. It is engaged in the business of mining, processing and trading minerals and ores, namely: Bentonite, a versatile clay having applications in foundries, iron ore pellatization, oil well drilling and civil engineering; Bauxite, the principal ore used for manufacturing alumina which is in turn used to produce Aluminum metal; Barytes, a clay with high specific gravity and is mainly used in oil well drilling; Iron ore, the principal ore for manufacturing steel. Ashapura is also engaged in the manufacturing of value added Bentonite for advanced applications for usage in paper, cosmetic and edible oil industries. The company also offers to arrange for logistical support for transportation and shipping of minerals which it sells to its customers. Chetan Shah, as foreign representative of Ashapura, filed a petition for protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 11-14668) on Oct. 4, 2011. Attorney for the foreign representative is: Ira A. Reid, Esq. BAKER & McKENZIE LLP 1114 Avenue of the Americas New York, New York 10036 Telephone: (212) 626-4100 E-mail: Ira.Reid@bakermckenzie.com The Chapter 15 petition estimated the Debtor's assets and debts to be between $100 million to $500 million. B & R CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: B & R Construction & Management, Inc. 520 W. 21st Street, Suite G2/705 Norfolk, VA 23517 Bankruptcy Case No.: 11-74467 Chapter 11 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court Eastern District of Virginia (Norfolk) Judge: Stephen C. St. John Debtor's Counsel: Joseph T. Liberatore, Esq. CROWLEY, LIBERATORE, RYAN & BROGAN, P.C. Town Point Center, Suite 300 150 Boush Street Norfolk, VA 23510 Tel: (757) 333-4500 Fax: (757) 333-4501 E-mail: jliberatore@clrbfirm.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 The Company?s list of its 20 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/vaeb11-74467.pdf The petition was signed by William Underwood, president. GAYLER FAMILY: Case Summary & 2 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Gayler Family Educational LLC 2431 Tech Center, Suite 100 Las Vegas, NV 89128 Bankruptcy Case No.: 11-25739 Chapter 11 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce T. Beesley Debtor's Counsel: Spencer M. Judd, Esq. MACDONALD & JUDD 6625 W. Sahara, Suite 1 Las Vegas, NV 89146 Tel: (702) 870-1771 Fax: (702) 869-0683 E-mail: spencer@jsmjlaw.com Scheduled Assets: $1,255,000 Scheduled Debts: $1,115,000 The Company?s list of its two largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/nvb11-25739.pdf The petition was signed by William Gayler, manager. BANCO INTERACCIONES: Moody's Lowers Deposit Ratings to 'Ba2' ------------------------------------------------------------ Moody's Investors Service downgraded Banco Interacciones, S.A.'s (Interacciones) Bank Financial Strength Rating (BFSR) to D- with negative outlook, from D with positive outlook; and its global local and foreign currency deposits to Ba2 with negative outlook, from Ba1 with positive outlook. At the same time, Moody's de Mexico downgraded the long term Mexican National Scale to A2.mx from A1.mx. Moody's also downgraded the bank's long term global local currency senior debt ratings to Ba2 from Ba1, as well as the subordinated debt ratings to Ba3, from Ba2. On the Mexican National Scale, Interacciones' senior debt ratings were downgraded to A2.mx, from A1.mx, and the subordinated debt ratings were downgraded to A3.mx, from A2.mx. The outlook for all ratings is now negative. The issuer ratings of Interacciones Casa de Bolsa, S.A. de C.V. (CB Interacciones) were also downgraded to Ba2, from Ba1. CB Interacciones' Mexican National Scale long term issuer rating was also downgraded to A2.mx from A1.mx. The outlook is negative. RATINGS RATIONALE In downgrading Interacciones' BFSR to D-, which maps to an unsupported baseline credit assessment (BCA) of Ba3, Moody's cited the bank's excessively high exposure to the highly-indebted Mexican state of Coahuila (Coahuila). Coahuila represents the bank's largest single credit exposure, that is equal to one fifth of the bank's total loan portfolio (up from 10% early in 2010) and to a materially high level of 2.2 times the bank's capital base. Moody's Local Market Analyst David Olivares-Villagomez cited that "although the loans to Coahuila continue to perform in terms of interest payments as they are secured by tax participation receipts from the federal government, the state was forced to restructure its loans and extend maturities for an additional six years through 2031". Moody's noted the restructuring will add pressure to Interacciones' limited long-term funding profile and require the bank to expand and diversify its long term funding sources to support the longer duration of its loan book. Moody's highlighted that the negative outlook on Interacciones' ratings reflects concerns regarding the bank's risk management structure and practices and higher risk appetite in light of the Coahuila exposure, as well as the implications of the case on its franchise image and future earnings prospects. Located in Mexico City, Mexico and with total assets of Mx$79.5 billion as of June 2011, Interacciones is a niche bank specialized in lending to Mexican states and municipalities. Downgrade of Interacciones Casa the Bolsa, S.A. de C.V. Moody's downgrade of CB Interacciones' global local currency issuer rating to Ba2 aligns this rating with CB Interacciones' unsupported intrinsic strength (BCA) of Ba2, which remains unchanged, and reflects that the issuer rating no longer benefits from uplift due to group support given the sister bank's now lower intrinsic strength. Moody's ratings on CB Interaccciones, however, continue to consider a high level of integration between the brokerage firm and its sister bank, Interacciones, including sharing of infrastructure, technological platforms and staff among other factors. Moody's noted that CB Interacciones' franchise and core earnings generation have not been affected by the Coahuila event. The methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, and Incorporation of Joint Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007. Moody's National Scale Ratings (NSRs) are intended as relative measures of creditworthiness among debt issues and issuers within a country, enabling market participants to better differentiate relative risks. NSRs differ from Moody's global scale ratings in that they are not globally comparable with the full universe of Moody's rated entities, but only with NSRs for other rated debt issues and issuers within the same country. NSRs are designated by a ".nn" country modifier signifying the relevant country, as in ".mx" for Mexico. For further information on Moody's approach to national scale ratings, please refer to Moody's Rating Implementation Guidance published in August 2010 entitled "Mapping Moody's National Scale Ratings to Global Scale Ratings". The Local Market analyst for this rating is David Olivares- Villagomez, + 5255 1253 5705. BARNWELL COUNTY: Chapter 9 Case Summary & Creditors List -------------------------------------------------------- Debtor: Barnwell County Hospital 811 Reynolds Road Barnwell, SC 2982 Bankruptcy Case No.: 11-06207 Chapter 9 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court District of South Carolina (Columbia) Debtor's Counsel: Lindsey Carlbert Livingston, Esq. HAYNSWORTH SINKLER BOYD, PA P.O. Box 11889 Columbia, SC 29211-1889 Tel: (803) 779-3080 E-mail: llivingston@hsblawfirm.com - and ? Stanley H. McGuffin, Esq. HAYNSWORTH SINKLER BOYD, PA 1201 Main Street, 24th Floor P.O. Box 11889 Columbia, SC 29211-1889 Tel: (803)540-7836 E-mail: smcguffin@hsblawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Charles Lowell Jowers, Sr., chairman of the board of trustees. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ SC Dept of Health and Human Government Contract $836,688 Services Bureau of Reimbursement P.O. Box 8206 Columbia, SC 29202-8206 Palmetto GBA, LLC Government Contract $621,742 Medicare Finance (AG-260) P.O. Box 100277 Columbia, SC 29202-0277 Barnwell County Government Contract $206,193 County Admin Building Barnwell, SC 29812 Palmetto Emergency Care Inc. Trade Debt $110,000 GE Healthcare Maintenance $89,421 Blue Cross/Blue Shield Trade Debt $79,613 Clinical Pathology Laboratories Trade Debt $77,890 Perot Systems Trade Debt $40,872 Cardinal Health Pharmacy Trade Debt $38,937 SC Medical Endoscopy, LLC Trade Debt $36,440 Cardinal Health Medical Products Trade Debt $30,704 Fisher Scientific Co. Trade Debt $20,000 Healthland Financing Maintenance $32,500 Sleepmed Trade Debt $32,275 Shepeard Community Blood Center Trade Debt $29,281 Nexen Pruett Jacobs Trade Debt $22,837 Jackson and Coker Trade Debt $20,137 Passport Health Communications Trade Debt $18,000 Joint Commission Trade Debt $15,182 The Radiology Group Trade Debt $15,067 BEAR ISLAND: Wins Court OK to Send Liquidation Plan to Creditors ---------------------------------------------------------------- Bear Island Paper Co., won bankruptcy court approval to seek votes on its amended liquidation plan. Dawn McCarty at Bloomberg News reports that U.S. Bankruptcy Court Judge Douglas O. Tice Jr. in Richmond, Virginia, ruled on Oct. 4 that the disclosure statement explaining the proposal provides enough information for creditors to make an informed decision. The confirmation hearing is scheduled for Nov. 22, at 2:00 p.m. The deadline to file an objection to the confirmation of the Plan and to vote to accept or reject the Plan is on Nov. 14. The Plan provides for the termination of the Debtor's business operations and the liquidation of its assets. Subject to the rights of certain parties in interest to object to the allowance and priority of claims, the Plan provides for the payment in full to holders of Allowed Administrative Claims and Allowed Priority Claims. The Plan further provides for a recovery to holders of Allowed General Unsecured Claims. Full-text copies of the Plan and Disclosure Statement are available for free at http://ResearchArchives.com/t/s?76c0 About White Birch & Bear Island Canada-based White Birch Paper Company is the second largest newsprint producer in North America. As of Dec. 31, 2009, the White Birch Group held a 12% share of the North American newsprint market and employed roughly 1,300 individuals (the majority of which reside in Canada). Bear Island Paper Company, L.L.C., is a U.S.-based unit of White Birch. Bear Island filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No. 10-31202) on Feb. 24, 2010. At June 30, 2011, the Company had $141.9 million in total assets, $153.2 million in total liabilities, and a stockholders' deficit of $11.3 million. White Birch filed for bankruptcy protection under Canada's Companies' Creditors Arrangement Act, before the Superior Court for the Province of Quebec, Commercial Division, Judicial District of Montreal, Canada. White Birch and five other affiliates -- F.F. Soucy Limited Partnership; F.F. Soucy, Inc. & Partners, Limited Partnership; Papier Masson Ltee; Stadacona Limited Partnership; and Stadacona General Partner, Inc. -- also sought bankruptcy protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. E.D. Va. Case No. 10-31234). Jonathan L. Hauser, Esq., at Troutman Sanders LLP, in Virginia Beach, Virginia; and Richard M. Cieri, Esq., Christopher J. Marcus, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP, in New York, serve as counsel to White Birch, as Foreign Representative. Kirkland & Ellis and Troutman Sanders also serve as Chapter 11 counsel to Bear Island. AlixPartners LLP serves as financial and restructuring advisors to Bear Island, and Lazard Freres & Co., serves as investment banker. Garden City Group is the claims and notice agent. Jason William Harbour, Esq., at Hunton & Williams LLP, in Richmond, Virginia, represents the Official Committee of Unsecured Creditors. Chief Judge Douglas O. Tice, Jr., handles the Chapter 11 and Chapter 15 cases. BERNARD L MADOFF: Greiff Victory Could Spur Dismissal of Suits -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that suits the trustee for Bernard L. Madoff Investment Securities LLC filed against hundreds of customers to recover fictitious profits could all be dismissed if a customer named James Greiff succeeds with a motion filed on Oct. 5 to dismiss the lawsuit now before U.S. District Judge Jed Rakoff in Manhattan. Mr. Rochelle discloses that Judge Rakoff took the suit out of bankruptcy court to decide two issues: Do the profits shown on account statements represent valid debt to counter a fraudulent transfer claim? Second, Rakoff told Greiff and the Madoff trustee to explain whether a provision in bankruptcy law known as the safe harbor bars suits because they stem from trades in securities. Judge Rakoff, Mr. Rochelle notes, already answered the second question when he ruled last month in a separate suit involving Fred Wilpon and the owners of the New York Mets that the safe harbor precludes the trustee from recovering any payments more than two years before bankruptcy. Mr. Rochelle relates that on the first issue, Greiff's lawyer, Helen Davis Chaitman, argues in her brief that the Madoff firm "was not a Ponzi scheme." She says it was "a legitimate trading business which operated a fraudulent investment business on the side to fund the trading operation." Consequently, she contends the trustee isn't entitled to the presumption that the Madoff firm was a Ponzi scheme and that payments it made to customers were fraudulent. Ms. Chaitman argues that the trustee has no right to sue because money paid to customers didn't belong to the Madoff firm in the first place. She says that the money was stolen from other customers and under law was held in trust. Consequently, it was trust funds the customers received, not Madoff firm property the trustee is entitled to recover. Mr. Greiff's lawyer, Mr. Rochelle adds, makes another technical argument when she says that only equity investors in Ponzi schemes can be compelled to pay back fictitious profits. She says that payments by a Ponzi on account of legitimate debt can't be recovered in bankruptcy. Securities and state law both give customers the right to property listed in their account statements, Ms. Chaitman argued. Consequently, she believes customers can't be sued for receiving fraudulent payments when they were only receiving money to which they were entitled. If Judge Rakoff rules that customers are required to give back fictitious profits received within two years of bankruptcy, Ms. Chaitman, according to Mr. Rochelle, argues that any deposits customers made into their accounts in the last two years should be offset against anything they're required to give back. In that respect, she points to part of the Wilpon decision in September where Judge Rakoff said it was undecided how to calculate how much a customer might be required to pay back. Mr. Rochelle recounts that in last month's decision, Judge Rakoff ruled that the trustee can only seek to recover fictitious profits going back two years. Unless the Wilpon decision is reversed on appeal, it means that the trustee's recovery from Mr. Greiff and other so-called innocent customers can't go back six years as the trustee is seeking in his complaints. Although he didn't decide the issue in the Wilpon case, Judge Rakoff wrote a footnote in his opinion saying the trustee "might well prevail on summary judgment seeking recovery of the profits." As a result, the trustee, when he files papers on Oct. 26, might ask for judgment against Mr. Greiff for profits taken out in two years. 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: Trustee Wants $47-Mil. From ABN Amro, Nomura -------------------------------------------------------------- Maria Chutchian at Bankruptcy Law360 reports that the trustee for Bernard L. Madoff Investment Securities LLC launched lawsuits against ABN Amro Bank NV and Nomura Holdings Inc. on Thursday, seeking to recover $47 million they allegedly received through Madoff's Ponzi scheme. In two separate complaints filed in New York bankruptcy court, Irving Picard alleges ABN Amro, now known as The Royal Bank of Scotland Group PLC, and Nomura received the ill-begotten funds through feeder companies that made billions of dollars in transfers during the last six years before Madoff's scam was outed, according to Law360. 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: Judge Approves Feeders' Ch. 11 Plans ------------------------------------------------------ Ian Thoms at at Bankruptcy Law360 reports that a New York bankruptcy judge on Tuesday approved the disclosure statements explaining the restructuring plans of two Fairfield Greenwich Group affiliates that acted as feeder funds for Bernard L. Madoff's massive Ponzi scheme. Law360 relates that the move allows Greenwich Sentry LP and Greenwich Sentry Partners LP to submit their plans, which they say enjoy broad support, to creditors for approval. Creditors must send their votes on the plans by Nov. 4, 2011, and the bankruptcy court will holding a confirmation hearing on Nov. 22, 2011. As reported in the Aug. 20, 2011 edition of the TCR, according to the Disclosure Statements, the Plans have substantially similar operative terms, with the exception of certain monetary amounts and other numbers involved that are specific to each Debtor. The primary components of both Debtors' plan are: -- the payment in full of allowed administrative expense claims, allowed professional fee claims, allowed priority tax claims, allowed priority claims and allowed general unsecured claims; -- the implementation of a settlement with the BLMIS trustee for the estate of Bernard L. Madoff Investment Securities; and -- the establishment of two trusts to hold the retained assets left in the Debtor's estate after consummation of the BLMIS trustee settlement and payment of allowed claims with priority over the allowed limited partner interests of certificates representing the beneficial ownership of the trusts. The central feature of Greenwich Sentry Partners, L.P.'s Plan is the BLMIS trustee settlement, wherein the Debtor believing, pursuant to its good faith business judgment, that avoidance action claims of the BLMIS trustee would be difficult to defend, has agreed, in sum, to allow the BLMIS trustee a claim and judgment in the amount of $5,985,000 and the BLMIS trustee has agreed to seek recovery of his claim only from certain specified assets of the Debtor, to allow the Debtor's customer claim against BLMIS in the amount of $2,011,304, to share recovery on certain litigation claims with the Debtor, and to provide for the distribution of the retained assets to creditors and limited partners free and clear of the BLMIS trustee claims. The central feature of Greenwich Sentry, L.P.'s Plan is the BLMIS trustee settlement, wherein the Debtor, believing, pursuant to its good faith business judgment, that avoidance action claims of the BLMIS trustee would be difficult to defend, has agreed, in sum, to allow the BLMIS trustee a claim and judgment in the amount of $206 million, and the BLMIS trustee has agreed to seek recovery of his claim only from certain specified assets of the Debtor, to allow the Debtor's customer claim against BLMIS in the amount of $35 million, to share recovery on certain litigation claims with the Debtor, and to provide for the distribution of the retained assets to creditors and limited partners free and cler of the BLMIS' trustee's claims. The BLMIS trustee agreed to support the Plans and Disclosure Statement and to vote his claim in favor of the Plans pursuant to the settlement agreements. BLMIS is a broker-dealer registered with the Securities and Exchange Commission, though customer accounts maintained by the Debtors at BLMIS. The Debtors have been informed that holder of not less than $60 million in limited partner interests in GS also favor the Court's approval of the Disclosure Statements and confirmation of the Plans. The Plans provide the Debtors' creditors with substantial recoveries and allows for recovery of equity. The Debtors propose a Sept. 1 hearing on the approval of their Disclosure Statements. Objections, if any, are due Aug. 25. Full-text copies of the Disclosure Statements are available for free at: http://bankrupt.com/misc/GREENWICHSENTRY_DS.pdf http://bankrupt.com/misc/GREENWICHSENTRYPartners_DS.pdf About Greenwich Sentry Liquidators of Fairfield Sentry Limited, filed a Chapter 15 petition for Fairfield in June 2010 (Bankr. S.D.N.Y. Case No. 10-13164). In July 2010, Kenneth Krys and Christopher Stride of Krys & Associates (BVI) Limited, the liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited obtained cross-border recognition as foreign main proceedings by the U.S. Bankruptcy Court of the funds' insolvency proceedings, pending in the British Virgin Islands. The liquidators are represented in the U.S. by Brown Rudnick LLP. Fairfield Sentry Limited was the largest "feeder fund" to Bernard L. Madoff Investment Securities LLC, and invested approximately 95% of its assets with BLMIS. BLMIS was placed into liquidation proceedings in the United States in December 2008, after it was revealed that Bernard Madoff operated BLMIS as a Ponzi scheme for many years. Fairfield Sigma Limited and Fairfield Lambda Limited were both feeder funds of Fairfield Sentry Limited, and invested all of their assets with Fairfield Sentry Limited. Greenwich Sentry, L.P., and an affiliate filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-16229) on Nov. 19, 2010, hoping to settle lawsuits filed against it in connection with its investments with Bernard L. Madoff. Paul R. DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP, in New York, represents the Debtors in the Chapter 11 cases. Bernard L. Madoff was charged by the Securities and Exchange Commission in December 2008 of orchestrating the largest Ponzi scheme in history, with losses topping US$50 billion. In March 2009, Mr. Madoff pleaded guilty to 11 federal crimes and admitted to turning his wealth management business into a Ponzi scheme. A trustee was appointed to liquidate and has been filing clawback suits against investors who withdrew phony profits from Mr. Madoff. On May 18, 2009, Irving H. Picard, the trustee liquidating the estate of Mr. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC, filed a lawsuit against Fairfield Sentry and Greenwich, seeking the return of $3.55 billion that Fairfield withdrew from Madoff during the period from 2002 to Madoff's arrest in December 2008. Since 1995, the Fairfield funds invested about $4.5 billion with BLMIS. Mr. Picard claims that Fairfield knew or should have known about the fraud give that it received from BLMIS unrealistically high and consistent annual returns of between 10% and 21% in contrast to the vastly larger fluctuations in the S&P 100 Index. In schedules filed with the Court, Greenwich Sentry disclosed $317,073,770 in total assets and $206,337,244 in total liabilities. BION ENVIRONMENTAL: Testing Program Initiated at Kreider Farms -------------------------------------------------------------- Bion Environmental Technologies, Inc., initiated a testing program to demonstrate the performance of its micro-aerobic treatment system at Kreider Farms dairy operations in Manheim (Lancaster County), Pennsylvania. Over the next 60 to 90 days, samples will be taken at various points throughout the system and sent to independent labs for evaluation. The data from the testing program will be used in conjunction with Bion's nutrient credit verification plan to determine the actual amount of verified nutrient credits earned from the operation of Bion's livestock waste treatment system and to support the issuance of a final water quality permit. Once the permit has been issued, Bion will periodically provide data and calculations to the PA Department of Environmental Protection which will then issue a verified credit number for that specific period that can be used to as a cost effective and affordable offset for Pennsylvania's obligations under the Chesapeake Bay Tributary Strategy to reduce excess nitrogen that impacts the Bay. About Bion Environmental Crestone, Colo.-based Bion Environmental Technologies, Inc. (OTC BB: BNET) -- http://biontech.com/-- has provided environmental treatment solutions to the agriculture and livestock industry since 1990. Bion's patented next-generation technology provides a unique comprehensive treatment of livestock waste that achieves substantial reductions in nitrogen and phosphorus, ammonia, greenhouse and other gases, as well as pathogens, hormones, herbicides and pesticides. The Company reported a net loss of $6.99 million on $0 of revenue for the year ended June 30, 2011, compared with a net loss of $2.97 million on $0 of revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $9.02 million in total assets, $8.94 million in total liabilities, $2.52 million in Series B Redeemable Convertible Preferred stock, and a $2.44 million total deficit. GHP Horwath, PC, in Denver, Colorado, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has not generated revenue and has suffered recurring losses from operations. BION ENVIRONMENTAL: Holders Convert Pref. Stock to Common Stock --------------------------------------------------------------- Holders of 22,300 shares of Bion Environmental Technologies, Inc.'s Series C Convertible Preferred Stock converted into 761,936 restricted shares of the Company's common stock at a conversion price of $3.00 per share. On Sept. 30, 2011, holders of 11,950 shares of the Company's Series B Convertible Preferred Stock converted into 612,438 restricted common shares of the Company's common stock plus 61,254 callable Conversion Warrants to purchase shares of the Company?s common stock at a price of $3.10 per share until Dec. 31, 2014. In connection with these conversions the Company paid commissions of $13,744 and issued 137,467 Conversion Warrants to FINRA broker dealers who assisted in the conversion. As of Sept. 30, 2011, 15,720 and 9,850 shares, respectively, of the Company's Series B and Series C Convertible Preferred Stock remain outstanding. The Company anticipates that an as yet uncertain number of additional shares of its Series B and Series C Convertible Preferred Stock will be converted into the Company?s restricted common stock on the same terms during the current month. On Sept. 30, 2011, the Company entered into an employment agreement with Mr. George Bloom, the Company's Chief Engineering Officer. A copy of the agreement is available at no charge at: http://is.gd/SWufkE About Bion Environmental Crestone, Colo.-based Bion Environmental Technologies, Inc. (OTC BB: BNET) -- http://biontech.com/-- has provided environmental treatment solutions to the agriculture and livestock industry since 1990. Bion's patented next-generation technology provides a unique comprehensive treatment of livestock waste that achieves substantial reductions in nitrogen and phosphorus, ammonia, greenhouse and other gases, as well as pathogens, hormones, herbicides and pesticides. The Company reported a net loss of $6.99 million on $0 of revenue for the year ended June 30, 2011, compared with a net loss of $2.97 million on $0 of revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $9.02 million in total assets, $8.94 million in total liabilities, $2.52 million in Series B Redeemable Convertible Preferred stock, and a $2.44 million total deficit. GHP Horwath, PC, in Denver, Colorado, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has not generated revenue and has suffered recurring losses from operations. BLOCKBUSTER INC: Moves to Block Brazil Retailer From Using Name --------------------------------------------------------------- Dow Jones' Daily Bankruptcy Review reports that Blockbuster Inc.'s new owners want a bankruptcy judge to halt Brazilian retail giant Lojas Americanas S.A.'s use of the movie renter's iconic blue-and- yellow logo on Lojas's stores and video kiosks in the South American country. About Blockbuster Inc. Blockbuster Inc., the movie rental chain with a library of more than 125,000 titles, along with 12 U.S. affiliates, initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan (Bankr. S.D.N.Y. Case No. 10-14997) on Sept. 23, 2010. It disclosed assets of $1 billion and debts of $1.4 billion at the time of the filing. Martin A. Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the U.S. Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. The Official Committee of Unsecured Creditors retained Cooley LLP as its counsel. In April 2011, Blockbuster conducted a bankruptcy court-sanctioned auction for all the assets. Dish Network Corp. won with an offer having a gross value of $320 million. BLUE HERON: Deadline for Bids on Two Sites Extended to Dec. 4 ------------------------------------------------------------- Wendy Culverwell at the Portland Business Journal reports that the deadline to bid on the former Blue Heron Paper Co. mill and lagoon sites has been extended to Dec. 14. According to the Business Journal, CB Richard Ellis, which is marketing the two properties on behalf of a trustee overseeing the liquidation of the bankrupt company, postponed the deadline to accommodate results of a separate auction for the contents of the mill. The original deadline was Oct. 19. The report notes that Buffalo, N.Y.-based NRI Global Inc. won the right to the machinery and equipment at the Oregon City location with a $5.7 million bid. NRI will control the property through August 2013 while it demolishes buildings and other systems. NRI will work with the buyer to determine the condition of the site when it is turned over, the report says. The Company's primary mill site at Willamette Falls in Oregon City and its lagoon-style water treatment plant in West Linn are being auctioned to raise funds to repay the company's creditors, according to the Business Journal. About Blue Heron Oregon City, Oregon-based Blue Heron Paper Company -- http://www.blueheronpaper.com/-- produces newsprint, and high bright and heavyweight groundwood specialty printing papers. Blue Heron filed for Chapter 11 protection (Bankr. D. Ore. Case No. 09-40921) on Dec. 31, 2009. David B. Levant, Esq., at Stoel Rives LLP, in Portland, Oregon, serves as bankruptcy counsel to the Debtor. Attorneys at Barran Liebman LLP have been tapped as labor and employment counsel. The Debtor also hired Vanden Bos & Chapman, LLP, as special counsel. The Company estimated $10 million to $50 million in assets and debts as of the Chapter 11 filing. In April 2011, the U.S. Bankruptcy Court for the District of Oregon converted the Chapter 11 case of Blue Heron to a bankruptcy case under Chapter 7. Peter C McKittrick, 13607 NW Cornell Rd PMB 229, Portland, Oregon, is appointed interim trustee of the Debtor's estate. The trustee's bond will be the blanket bond on file with the U.S. Bankruptcy Court Clerk. BLUEKNIGHT ENERGY: Obtains Final OK of Class Action Settlement -------------------------------------------------------------- Blueknight Energy Partners, L.P., announced that on Oct. 5, 2011, the U.S. District Court for the Northern District of Oklahoma has granted final approval and issued a final judgment relating to the settlement of the consolidated securities class action litigation, In Re: SemGroup Energy Partners, L.P., Securities Litigation, Case No. 08-MD-1989-GKF-FHM, in accordance with the Stipulation of Settlement entered into by the parties on May 3, 2011. The settlement provides for, among other things, dismissal of the Class Action Litigation with prejudice, releases in favor of the defendants and collective payment by the defendants in accordance with the Stipulation of Settlement. The Stipulation of Settlement was provided for in the Partnership's Dec. 31, 2010, financial statements. No parties admit any wrongdoing as part of the settlement. "Settlement of the Class Action Litigation is another step that furthers BKEP's restructuring. We are pleased to have this SemGroup legacy issue resolved and behind us," explained Mr. James C. Dyer, Chief Executive Officer of BKEP?s general partner. About Blueknight Energy Blueknight Energy Partners, L.P. (Pink Sheets: BKEP) -- http://www.bkep.com/-- provides integrated terminalling, storage, processing, gathering and transportation services for companies engaged in the production, distribution and marketing of crude oil and asphalt product. It provides services for the customers, and its only inventory consists of pipeline linefill and tank bottoms necessary to operate the assets. It has three operating segments: crude oil terminalling and storage services, crude oil gathering and transportation services, and asphalt services. The Company reported a net loss of $23.79 million on $152.62 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $16.50 million on $156.77 million of total revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $327.44 million in total assets, $372.97 million in total liabilities, and a $45.52 million total partners' deficit. BOMBARDIER INC: DBRS Confirms Issuer Rating at 'BB' --------------------------------------------------- DBRS has confirmed the Issuer Rating and the Senior Unsecured Debentures rating of Bombardier Inc. (BBD or the Company) at BB with a Stable trend. BBD's Preferred Shares have also been confirmed, at Pfd-4 with a Stable trend. The confirmation reflects our expectation that the Company's financial measures, while acceptable for the current rating, are unlikely to materially improve in the next two to three years because of high capex requirements and continued demand uncertainty in the Company's aerospace division (BA, accounting for 45% of total EBIDTA in H1 F2012). BBD is a leading global manufacturer of transportation equipment, including a broad range of business and commercial aircraft. DBRS believes that the business risk profile of BBD's transportation division (BT, contributing 55% of total EBITDA in H1 F2012) is adequate and stronger than that of its BA division, which contributes the remaining 45% of EBITDA. BT is supported by its market-leading position, particularly in rolling stock, although this is partly offset by its single-digit EBIT margin. Despite its cost focus and steadily improving profitability and execution track record in the past six years, the low operating margin and complexity in contract execution could leave little room for problems or delays. BA's business risk profile is weak, in view of volatile demand conditions and significant execution risks associated with the ongoing aircraft development programs. Although these product developments could enhance BA's long-term market positions in both the business and commercial aircraft segments, they would likely result in negative free cash flow for BA in the next two to three years. BBD has reported that these programs have to-date progressed according to schedule. BBD's overall financial performance in F2011 (ended January 31, 2011) weakened further from F2010 levels, with 9% declines in both revenue and EBITDA, largely reflecting continued slow aircraft deliveries and slow freight locomotive sales. More recently, however, DBRS has observed signs of improving market conditions over the past 12 to 18 months, supporting 13% and 8% year-over- year increases in revenue and EBITDA, respectively, in H1 F2012. In addition, the Company has witnessed strong order intake over this period, increasing backlog to $57 billion at July 31, 2011, up almost 30% from the January 31, 2010 level. This improved backlog level should provide some support to BBD's future operating cash flow generation. The deterioration was also partly the result of an increase in debt by $500 million to finance BBD's capital spending and lower EBITDA, and was maintained at similar levels for the first six months of F2012. Gross adjusted debt-to-EBITDA of 3.4 times (x) and cash flow-to-total debt of 24% are at the weaker end of acceptable ranges for the rating, although this is partly mitigated by BBD's strong liquidity position. Going forward, DBRS conservatively expects revenue to grow by 5% to 7% and for the overall EBITDA margin to be maintained between 8.5% and 9.5%, reflecting the support from the Company?s currently strong backlog position. We also expect capex to remain high at $1.4 billion in F2012, $1.2 billion in F2013 and $1.0 billion per year thereafter to support ongoing product developments and capacity increases, with BBD expected to maintain a cash balance of $3.0 billion. With these assumptions, we project that BBD's financial measures will stay at similar levels, with adjusted debt-to-EBITDA between 3.0x and 3.4x and cash flow-to-adjusted debt between 20% and 22% over the next few years. DBRS expects more meaningful improvement to occur only after F2014. We are mindful that demand volatility (especially in BA) and possible execution problems in the Company's aircraft development program could potentially worsen financial measures in the near term from our projections and/or delay their improvements beyond F2014. DBRS would consider raising BBD's rating if the Company successfully completes developments and builds its order books for the new aircraft programs, continues its improvement in execution and operating margins in BT, and begins to strengthen its financial risk profile through improved free cash flow and debt reduction. Conversely, any problems or delays in new aircraft programs that could affect BBD's market standing as an aircraft manufacturer or materially increase development costs could result in negative rating action. CALPINE CORP: S&P Raises Corporate Credit Rating to 'B+' -------------------------------------------------------- Standard & Poor's Ratings Services raised Calpine Corp.'s (Calpine) corporate credit rating to 'B+' from 'B'. "We also raised the rating on secured debt at Calpine Corp. to 'BB-' from 'B+'. The '2' recovery rating on the secured debt is affirmed, indicating expectations for substantial recovery of principal (70% to 90%) in the event of a payment default. The outlook is stable. We also revised the company's business profile to 'fair' from 'weak', while the financial profile remains 'highly leveraged'," S&P related. The rating upgrade reflects several factors that benefit both the business and financial profiles of the company. These include the acquisition of the Connectiv assets in June 2010, which added capacity revenues to Calpine's energy-dominated mix; ongoing merchant market trends that Calpine's all-gas fleet is ideally poised to benefit from, such as low natural gas prices that lead to fuel-switching and Environmental Protection Agency (EPA) regulations, such as Maximum Achievable Control Technology (MACT) and the Cross-State Air Pollution Rule (CSAPR); refinancing activity that has eliminated all material debt maturities until 2016; and a recognition that Calpine has remained free cash flow positive for the past three years and is expected to remain so for the next few years. "When we point to the potential benefits that will accrue to Calpine due to EPA environmental regulations on coal and from fuel switching, we are only referring to a favorable business environment for the company," said Standard & Poor's Senior Director Swaminathan Venkataraman. "Our upgrade is, however, not premised on any upside expectations that Calpine's EBITDA and financial ratios will improve significantly as a result of coal plant retirements. Rather, it is resilience to downside risk that we are emphasizing in our rating upgrade," added Mr. Venkataraman. Calpine has remained free cash flow positive (adjusting in 2012 for the Russell City capital expenditure that has already been project financed) even under the Standard & Poor's price deck case that does not incorporate any CSAPR or MACT benefits. Calpine is the largest independent power producer (IPP) in the country, owning 92 plants with 28,127 megawatts (MW) of generating capacity and 584 MW under construction. Calpine's operating segments are divided geographically, with the West having 7,482 MW (including 584 MW under construction), 7,239 MW in Texas, 6,083 MW in the Southeast, and 7,907 MW in the North (including PJM and Canada). CAPMARK FIN'L: Emerges From Ch. 11, Releases Funds for Creditors ---------------------------------------------------------------- Capmark Financial Group Inc. and certain of its debtor subsidiaries emerged from bankruptcy on Sept. 30, 2011. On the effective date of their Chapter 11 plan, the Company and certain of its debtor subsidiaries distributed to the plan disbursing agent for the benefit of holders of the allowed general unsecured claims and the reserve for disputed claims (i) $900 million of cash, (ii) $1.25 billion of newly secured notes consisting of $750 million principal amount of floating rate first lien A notes due 2014 and $500 million of floating rate first lien extendible B notes due 2015, and (iii) approximately 100 million shares of Company common stock. The common stock may be traded over-the-counter but is not listed on any securities exchange. The Company will not participate in making a market or facilitating a market in its common stock. The initial distribution by the plan disbursing agent to allowed claimholders began on September 30, 2011. On the Effective Date, the Company deposited approximately $360 million with the trustee for the newly issued notes for the purpose of making a pro rata repayment of principal on the A Notes. This initial cash payment to the holders of the A Notes is expected to occur on or after Oct. 7, 2011. About Capmark Financial Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- provides financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. Capmark has 1,000 employees located in 37 offices worldwide. On Oct. 25, 2009, Capmark Financial and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 (Bankr. D. Del. Lead Case No. 09-13684). Capmark disclosed assets of US$20 billion against total debts of US$21 billion as of June 30, 2009. Capmark's financial advisors are Lazard Freres & Co. LLC and Loughlin Meghji + Company. Capmark's bankruptcy counsel is Dewey & LeBoeuf LLP. Richards, Layton & Finger, P.A., serves as local counsel. Beekman Advisors, Inc., is serving as strategic advisor. KPMG LLP is tax and accounting advisor. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. The Official Committee of Unsecured Creditors in Capmark Financial Group Inc.'s cases tapped Kramer Levin Naftalis & Frankel LLP as its counsel and JR Myriad LLC as its commercial real estate business advisors. The Committee also retained Cutler Pickering Hale and Dorr LLP as its attorneys for the special purpose of providing legal services in connection with Federal Deposit Insurance Corporation matters. Protech Holdings C LLC, an affiliate of Capmark, filed for Chapter 11 protection on July 29, 2010 (Bankr. D. Del. Case No. 10-12387). The Debtor estimated assets and debts in excess of $1 billion as of the filing date. Since filing for Chapter 11, Capmark completed three sales to generate more than $1 billion in cash. Berkshire Hathaway Inc. and Leucadia National Corp. bought most of the business for $468 million. In April 2011, Greenline Ventures LLC completed the acquisition of the New Markets Tax Credit division of Capmark Financial Group Inc. Since inception of the NMTC program, Capmark's NMTC division has closed over $1.1 billion of NMTC investment funds and financed over $2.5 billion of projects and businesses in low income communities nationwide. CASCADES INC: DBRS Confirms Issuer Rating at 'BB' ------------------------------------------------- DBRS has confirmed the Issuer Rating and Senior Unsecured Debt rating of Cascades Inc. (Cascades or the Company), both at BB (high) with a Stable trend. The confirmation recognizes the Company's acceptable, albeit weaker, financial metrics, which remain within the current rating parameters. The Stable trend reflects the Company's solid liquidity and minimal long-term debt due until beyond 2016. The Company's recovery stalled in the last half of 2010 but 2010 results were still well above the lows experienced in 2008 and prior. However, the challenging industry conditions carried through to 2011 and the Company's performance was below expectations in the first half of the year (H1 2011). EBITDA declined by 31% in H1 2011 over 2010, with the Specialty Product and Tissue segments taking the most severe hit, with their EBITDA levels declining by approximately 42% and 40%, respectively. A strong Canadian dollar and rising prices of recycled fibres largely contributed to the earnings decline. Nevertheless, DBRS expects the Company's financial profile to stabilize in the near term. This is based on the expectation that the announced increase in prices in all core products, except Containerboard, will have a positive impact on earnings for the rest of 2011. In addition, benefits from restructuring initiatives and an improvement in operating rates and efficiency should help boost earnings. Furthermore, the two negatives that have affected performance of late ? recycled fibre prices and the Canadian dollar ? seem to be fading. Recycled fibre prices appear to have peaked and the Canadian dollar is back to below parity with the U.S. dollar. These developments bode well for the Company's performance. The Company has continued to deleverage during H1 2011. Cascades received a substantial amount of cash proceeds ($335 million net of taxes), largely from the sale of converting business Dopaco Inc., which it used to reduce debt. Furthermore, the Company continues to enjoy solid liquidity, with cash and available committed facilities totalling $622 million at the end of June 2011. The Company has modest debt due in 2012 and minimal refinancing risk until beyond 2016, which adds to its financial flexibility The current rating continues to be supported by the Company's solid business profile. Reducing business risk are Cascades? value-added packaging, its specialty product sales mix, and high containerboard converting integration levels (a strategy that has improved earnings stability through industry cycles relative to producers with a larger proportion of commodity products and limited integration). In addition, contributions from the sizeable, higher-margin and comparatively less volatile tissue business further enhance earnings stability. However, DBRS notes that the current debt-to-capital structure is still aggressive for a cyclical company, even when excluding the portion of non-recourse debt on the balance sheet (approximately 10% of total). The Company's debt coverage ratios are at the low end of the current rating range, and a lack of progress in strengthening its financial profile in the next 12 months would likely lead to negative rating actions. DBRS has simulated a default scenario for Cascades in order to analyze the potential recovery for the Company's Senior Unsecured Debt in the event of default. The scenario assumes a prolonged period of severe economic conditions, regardless of how hypothetical or unlikely the conditions may be, in which product demand and prices plummet, and EBITDA quickly declines and turns negative over the forecast period. DBRS assumes that the Company would be reorganized as a going concern in the event of default, and has derived a recovery rating of RR4 for the Senior Unsecured Debt. The RR4 rating corresponds to recovery prospects of between 30% and 50% for senior unsecured debtholders. CCFC FINANCE: S&P Raises Rating on $1-Bil. Bank Note to 'BB' ------------------------------------------------------------ Standard & Poor's Ratings Services raised its rating to 'BB' from 'BB-' on CCFC Finance Corp.'s (CCFC) $1 billion senior secured bank note due 2016 (Calpine CCFC Holdings LLC is a joint issuer) and BRSP LLC's (BRSP) $282 million senior secured term loan due July 2014. The recovery rating on both loans is unchanged at '1', indicating our expectation of very high (90% to 100%) recovery of principal in the event of a default. These rating actions follow our upgrade of Calpine Corp. to 'B+' from 'B'. As 100% owned, non- ring-fenced subsidiaries of Calpine, the default risk on both CCFC and BRSP is the same as the CCR on Calpine. Secured debt at CCFC and BRSP is rated two notches above the CCR, given the '1' recovery rating on the debt. CDC CORP: Files for Chapter 11 Bankruptcy Protection ---------------------------------------------------- Atlanta Business Chronicle reports that CDC Corp. filed for Chapter 11 protection in the U.S. Bankruptcy Court in Atlanta on Oct. 4, 2011. In its Chapter 11 filing, CDC Corp. reported assets of $377.4 million and debts of $250 million. According to the report, the Company reported a loss of $6 million on revenue of $109 million for the six months ended June 30, 2011. In a Sept. 16 filing with the Securities and Exchange Commission, CDC Corp. lost a lawsuit before the Supreme Court of New York and was ordered to pay $65.4 million to Evolution CDC SPV Ltd. on Sept. 8. "The company is currently considering all available options, including an appeal of this judgment," the filing said. The SEC filing also notes that on Sept. 12, CDC Corp.'s chief financial officer, John Stone, resigned. Based in Atlanta, CDC Corp. (Nasdaq: CHINA) -- http://www.cdccorporation.net/-- is the parent company of CDC Software (Nasdaq: CDCS). CDC Software is based dually in Shanghai, China, and Atlanta and produces enterprise software applications, IT consulting services, outsourced applications development and IT staffing. The company's owners include Asia Pacific Online Ltd., Xinhua News Agency and Evolution Capital Management. A case summary for CDC Corp. is in the Oct. 6, 2011 edition of the TCR. CENTRAL BUILDING: Wants to Use KeyBank Cash Collateral ------------------------------------------------------ Central Building LLC and its unit Crow Partners LLC ask the Bankruptcy Court to enter an order for limited use of KeyBank N.A.'s cash collateral and granting KeyBank replacement liens as adequate protection. The Debtors made the request on an emergency basis. The Debtors said they need to use the Cash Collateral to pay for property management, utility bills, and otherwise continue the operation of the County Square Shopping Center. The Debtors said they do not have a direct contact with KeyBank counsel and have been unable to propose a consensual use of KeyBank's cash collateral. However, the obligation to KeyBank is not in default, and the Debtors believe that their proposed use of cash collateral and accompanying budget would be acceptable to KeyBank, as they provide for continuing payment of all expenses out of cash collateral generated by County Square in the same manner as pre- petition; the only significant change is the addition of payment to Avion Holdings, LLC, which is being retained as their Restructuring Agent. County Square Shopping Center is a 52,000 square foot shopping center located at 508 Contra Costa Blvd., in Pleasant Hill, Contra Costa County, California. County Square has an estimated value of $10,000,000, subject to a secured loan in favor of KeyBank. County Square is fully developed and 86% leased, and it generates positive cash flow after current expenses. Central Building also owns a parcel of land improved with a 66,430 square foot shopping center, located at the intersection of Camelback Road and Dysart Road in Maricopa County, Arizona, known as Camelback Place at Dysart. In October 2004, Central Building executed a Promissory Note in favor of Washington Mutual Bank, FA, in the original principal amount of $9,110,000. The California Note and a related Deed of Trust were subsequently acquired by KeyBank. Central Building is current on its payments on the California Note, which matures by its terms on Nov. 1, 2014. Except for the Chapter 11 filing, there are no defaults under the California Note. The Deed of Trust grants KeyBank, in addition to a lien on County Square and related improvements and contracts. The Central Building's other significant secured creditor, Chase Bank, is secured by a lien related to Camelback Place and is unaffected by the proposed use of KeyBank's cash collateral. As of the Petition Date, Central Building owed KeyBank $9,062,010.85. The Debtors believe that KeyBank is fully secured. The Debtors' proposed budget provides for monthly adequate protection payments to KeyBank equal to the monthly non-default payments due under the California Note, in the amount of $47,700 per month. The Budget will be permitted to compensate Avion up to a stated monthly maximum amount provided for in the budget out of Cash Collateral. Avion's compensation will remain subject to Bankruptcy Court approval. Central Building will provide to KeyBank, as adequate protection for its permitted use of Cash Collateral, a valid and perfected security interest and lien in all of Central Building's now owned or after acquired personal property of all types related solely to County Square. To the extent that KeyBank's interest in the cash collateral is not adequately protected, KeyBank will have an allowed superpriority administrative expense claim pursuant to Bankruptcy Code Sec. 507(b). The Budget does not provide for any compensation for insiders. About Central Building Orinda, California-based Central Building LLC and its wholly owned subsidiary Crow Partners LLC filed for Chapter 11 bankruptcy (Bankr. D. Ariz. Case No. 11-27970) on Oct. 3, 2011. Central Building does business in Arizona under the name Central Building Camelback LLC. The Debtors own the County Square Shopping Center in California and the Camelback Place at Dysart in Arizona. The Debtors' sole members are Neal Smither and his spouse, Patricia Smither. The equity interests are subject to a Voting Trust Agreement of which G. Neil Elsey, a principal of Avion Holdings, LLC, is the voting trustee. Avion has also been retained as Restructuring Agent to manage and operate the Debtors during their restructuring. Judge George B. Nielsen, Jr. presides over the case. Lawyers at Stinson Morrison Hecker LLP in Phoenix, Arizona, serve as the Debtors' counsel. In its petition, Central Building estimated $10 million to $50 million in both assets and debts. The petition was signed by Neal Smither, member. CENTRAL BUILDING: Sec. 341 Creditors' Meeting Set for Nov. 8 ------------------------------------------------------------ The U.S. Trustee for the District of Arizona in Phoenix will convene a meeting of creditors in the bankruptcy cases of Central Building LLC and Crow Partners LLC on Nov. 8, 2011 at 10:30 a.m. at US Trustee Meeting Room, 230 N. First Avenue, Suite 102, in Phoenix. 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 Central Building Orinda, California-based Central Building LLC and its wholly owned subsidiary Crow Partners LLC filed for Chapter 11 bankruptcy (Bankr. D. Ariz. Case No. 11-27970) on Oct. 3, 2011. Central Building does business in Arizona under the name Central Building Camelback LLC. The Debtors own the County Square Shopping Center in California and the Camelback Place at Dysart in Arizona. The Debtors' sole members are Neal Smither and his spouse, Patricia Smither. The equity interests are subject to a Voting Trust Agreement of which G. Neil Elsey, a principal of Avion Holdings, LLC, is the voting trustee. Avion has also been retained as Restructuring Agent to manage and operate the Debtors during their restructuring. Judge George B. Nielsen, Jr. presides over the case. Lawyers at Stinson Morrison Hecker LLP in Phoenix, Arizona, serve as the Debtors' counsel. In its petition, Central Building estimated $10 million to $50 million in both assets and debts. The petition was signed by Neal Smither, member. CHINA DU KANG: Files Form 10 with SEC; Registers Common Shares -------------------------------------------------------------- China Du Kang Co., Ltd., filed with the U.S. Securities and Exchange Commission a Form 10-12g to register the Company's common stock, par value $0.001 per share, pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended. The Company intends to be subject to the requirements of Regulation 13A under the Exchange Act, which requires the Company to file annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, and the Company is required to comply with all other obligations of the Exchange Act applicable to issuers filing registration statements pursuant to Section 12(g) of the Exchange Act. A full-text copy of the filing is available for free at: http://is.gd/NcnPwe About China Du Kang China Du Kang Co., Ltd., was incorporated as U.S. Power Systems, Inc., in the State of Nevada on Jan. 16, 1987. The Company is principally engaged in the business of production and distribution of distilled spirit with the brand name of "Baishui Dukang". The Company also licenses the brand name to other liquor manufactures and liquor stores. The Company's balance sheet at June 30, 2011, showed $15.17 million in total assets, $22.50 million in total liabilities, and a $7.33 million total shareholders' deficit. Keith K. Zhen, CPA, in Brooklyn, New York, expressed substantial doubt about 's ability to continue as a going concern, following the Company's 2010 results. Mr. Zhen noted that the Company has incurred an operating loss for each of the years in the two-year period ended Dec. 31, 2010, and as of Dec. 31, 2010, has a working capital deficiency and a shareholders' deficiency. CHURCH & DWIGHT: S&P Withdraws 'BB+' Rating on $250-Mil. Notes -------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on Princeton, N.J.-based Church & Dwight Co. Inc., including its long-term corporate credit rating to 'BBB' from 'BBB-'. "We also raised the ratings on the shelf registration statement filed Feb. 24, 2009, to preliminary 'BBB' senior unsecured and preliminary 'BBB-' subordinated. We also withdrew our 'BB+' rating on the $250 million 6% senior subordinated notes due 2012, which were previously paid-off. At the same time, we assigned our 'A-2' short-term corporate credit and commercial paper (CP) ratings to Church & Dwight Co. Inc. As of July 1, 2011, the company had about $250 million of debt outstanding," S&P related. "The rating actions reflect the company's improved operating performance and credit ratios (including our standard adjustments) even through the economic downturn, and our expectations for steady free cash flow generation and strong liquidity, despite the likelihood of mid-sized debt-financed acquisitions in the near-to- intermediate term," S&P stated. "Standard & Poor's ratings on Church & Dwight reflect our view of its satisfactory business risk profile that incorporates the company's diverse product portfolio within household and personal care sector, including its established consumer brands; its satisfactory financial performance and free cash flow generation; and market share gains partly associated with a sizable mix of value offerings. Factors that partly offset the positive factors include: Church & Dwight's participation in the highly competitive household and personal care segment of the consumer products industry, including competition from several larger and more diversified companies; its limited geographic diversity; and its exposure to volatile commodity costs," S&P related. "Church & Dwight's intermediate financial risk profile assessment incorporates our expectation that the company will continue to be acquisitive. As a result of this belief, we expect its credit ratios, which are currently strong as compared to the 'BBB' rating category, will weaken to levels consistent with the 'BBB' rating over time, including a ratio of total debt to EBITDA in the low-2x area and a ratio of funds from operations (FFO) to total debt in the 35%-40% range," S&P related. "We believe most of Church & Dwight's brands are gaining market share as result of a combination of the company expanding some of its brands to new product categories and the trend of consumers trading down to value brands," said Standard & Poor's credit analyst Jerry Phelan. "For example, its Arm & Hammer brand was expanded to liquid detergent, cat litter, and other household cleaning products." Indeed, during the past year the company has reported volume growth in the low? to mid-single digit range. Still, the company competes with much larger consumer products companies that have greater resources to develop, promote, and market products. With about $2.6 billion of sales, the company is relatively small compared with Procter & Gamble Co. and Colgate-Palmolive Co. ($82 billion and $16 billion in sales). Church & Dwight's operations are also less geographically diverse than those of many of its competitors; about 80% of the company's sales are in the U.S., compared with less than 30% for Colgate-Palmolive. The outlook is stable. "We expect the company's financial performance to remain relatively constant, despite the potential for some margin erosion as a result of weakening economic conditions and continued high commodity costs," S&P stated. CITIZENS REPUBLIC: M. Champion Elected by U.S. Treasury to Board ---------------------------------------------------------------- Madeleine L. Champion was elected to the Citizens Republic Bancorp, Inc., Board of Directors pursuant to the terms of Citizens' Series A Fixed Rate Cumulative Perpetual Preferred Stock issued to the United States Department of Treasury in December 2008 in connection with Citizens' participation in Treasury's Capital Purchase Program. In accordance with the terms of Citizens' written supervisory agreement with the Federal Reserve Bank of Chicago and the Michigan Office of Financial and Insurance Regulation, the FRBC has also approved the election of Ms. Champion. Under the terms of the Series A Preferred Stock, Treasury has the right to appoint up to two directors to Citizens' Board of Directors at any time that dividends payable on the Series A Preferred Stock have not been paid for an aggregate of six quarterly dividend periods. William Fenimore was elected by Treasury on Sept. 16, 2011, pursuant to this provision. The terms of the Series A Preferred Stock provide that Treasury will retain the right to elect such directors until all accrued and unpaid dividends have been paid. Ms. Champion, 66, is an international management and trade consultant for financial and non-financial institutions. She has more than twenty-five years of senior management experience in the banking industry and had served as President of the Bankers' Association for Finance and Trade. Ms. Champion was Managing Director/Senior Vice President of International Banking for JPMorgan Chase Bank, NA, from 2004 through 2008 and Managing Director of Emerging Markets/International Financial Institutions for Banc One Capital Markets, Inc., from 2001 to 2004. She has also served as Senior Vice President, International Financial Institutions, for Bank One, NA, from 1998 to 2001 and as Senior Vice President and head of Global Marketing and Financial Institutions for Bank One from 1997 to 1998. Ms. Champion has also held senior management positions for international banking operations for CoreStates Bank and Fidelity Bank, from 1982 through 1997. Ms. Champion is also a director of Fresh Del Monte Produce Inc., where she has served as an independent director since 2009. Ms. Champion will be compensated under Citizens' standard compensation arrangement for outside directors as described in Citizens' most recent proxy statement. The Board has not yet made a determination as to any committee appointments for Ms. Champion, although it intends to appoint her to the board of its Citizens Bank subsidiary. There have been no transactions within the last fiscal year, or any currently proposed transactions, in which Citizens was or is to be a participant and in which she has or had a direct or indirect material interest. About Citizens Republic Flint, Michigan-based Citizens Republic Bancorp, Inc., is a diversified banking and financial services company that is registered as a bank holding company under the Bank Holding Company Act of 1956, as amended. Citizens provides a full range of banking and financial services to individuals and businesses through its banking subsidiary, Citizens Bank. The Company reported a net loss of $292.9 million on $329.1 million of net interest income for 2010, compared with a net loss of $514.2 million on $310.4 million of net interest income for 2009. The Company's balance sheet at June 30, 2011, showed $9.49 billion in total assets, $8.51 billion in total liabilities and $979.72 million in total shareholders' equity. * * * As reported in the TCR on Feb. 8, 2011, Fitch Ratings downgraded the long-term and short-term Issuer Default Ratings for Citizens Republic Bancorp, Inc., and its principal banking subsidiaries to 'CCC/C' from 'B-/B', respectively. CLEAN BURN: Employs Dough Davis as Auctioneer --------------------------------------------- Clean Burn Fuels LLC sought and obtained permission from the U.S. Bankruptcy Court for the Middle District of North Carolina to employ and compensate Doug Davis Realtor-Appraiser-Auctioneer, Inc. as auctioneer. The Debtor is seeking to sell at public auction certain motor vehicles. Doug Davis will, among other things: a. any and all transportation costs incurred with the sale of the Vehicles; b. provide and post of any signs of the pending sales on the Vehicles; and c. provide a registrar/cashier at the sales. The Debtor seeks to compensate the Auctioneer at the rate of 10% of the gross sales proceeds, which is the standing standard compensation rate for the Middle District of North Carolina, and to reimburse the Auctioneer for advertising costs incurred in the marketing of the Vehicles. Dough Davis attest that he holds no interest adverse to the estate and therefore a disinterested person as defined in 11 U.S.C. Section 101(14). About Clean Burn Founded in 2005, Clean Burn Fuels LLC is the first company to produce ethanol in North Carolina. It completed the construction of its ethanol plant in August 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: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Clinton Court Development LLC 22 West 38th Street, 12th Floor New York, NY 10018 Bankruptcy Case No.: 11-14673 Chapter 11 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Judge: Robert E. Gerber Debtor's Counsel: Robert R. Leinwand, Esq. ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK P.C. 875 Third Avenue, 9th Floor New York, NY 10022 Tel: (212) 603-6300 E-mail: rrl@robinsonbrog.com Scheduled Assets: $17,210,000 Scheduled Debts: $47,347,150 The petition was signed by David Weiss, manager. Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ D: TD Banknorth Mortgage $25,064,515 P.O. Box 5600 Lewiston, ME 04243 Abraham Weiss -- $3,026,039 3442 Bedford Avenue Brooklyn, NY 11210 Long Island Concrete Inc. -- $2,500,000 31-31 48th Avenue Long Island City, NY 11101 Robert Jacobs -- $1,000,000 141-59 73rd Terrace Flushing, NY 11367 Island Plumbing Supply -- $298,592 1956 McDonald Avenue Brooklyn, NY 11223 Y&L NY Interiors Inc. -- $260,000 1053 Dahill Road Brooklyn, NY 11204 Atlantic Hoisting & Scaffolding -- $183,957 Total Safety Consulting LLC -- $106,650 NLM Tile Inc. -- $80,000 Andrew S. Contracting, Inc. -- $65,785 Luxaire HVAC Services, Inc. -- $60,000 Substance Inc. -- $48,273 Advanced Installation and Sales -- $37,000 Inc. Alba USA Construction Inc. -- $35,000 Lieberts Royal Green Appliance -- $25,305 Center Glickman Engineering Associates -- $19,248 PLLC Creative Soldier -- $17,000 Rockland Custom Furniture Inc. -- $15,000 B. Moore Designs -- $14,948 A.D. Steel Equipment Co. -- $13,210 COMPASS DIVERSIFIED: Moody's Rates $275MM Credit Facility at 'Ba1' ------------------------------------------------------------------ Moody's Investors Service assigned a Ba1 rating to Compass Diversified Holding's $275 million senior secured revolving credit facility and a B1 rating to its $225 million senior secured term loan (collectively referred to as the $500 million senior secured credit facility). At the same time, Moody's affirmed the Ba3 Corporate Family Rating, the B1 Probability of Default Rating and the SGL 3 speculative grade liquidity rating. The rating outlook remains stable. Ratings on the existing term loan and revolver will be withdrawn upon closing of the transaction. The proceeds are expected to be used to repay amounts outstanding under the existing senior secured credit facility ($73 million term loan outstanding and $340 million revolver), and to fund future acquisitions. In August 2011, the company used the proceeds from a $70 million common and preferred stock equity offering and almost $200 million of revolver borrowings to fund the acquisition of Camelbak, a company that makes personal hydration products catering to outdoor recreational activities and military applications. These ratings were assigned: $275 million revolving credit facility maturing in October 2016 at Ba1 (LGD 2, 13%); $225 million term loan maturing in October 2017 at B1 (LGD 4, 57%); These ratings were affirmed: Corporate Family Rating at Ba3; Probability of Default Rating at B1; Speculative grade liquidity rating at SGL 3. RATING RATIONALE The Ba3 Corporate Family Rating reflects the company's strong industry and product diversification, moderate financial leverage pro forma for the Camelbak acquisition and good interest coverage. The rating also benefits from the company's size with revenue around $1.9 billion (pro forma for Camelbak acquisition) and strong geographic diversification throughout the US. The rating is constrained by the company's policy of distributing the majority of its operating cash flow to shareholders, the potential for lower demand for the company's products as a result of an uncertain economy and the severe earnings volatility in its staffing business. The SGL-3 speculative grade liquidity rating reflects Moody's belief that Compass will maintain an adequate liquidity profile over the next 12-15 months. Liquidity is constrained by the upcoming maturity of its revolver in December 2012 (absent the proposed refinancing), minimal amount available under the revolver after the Camelbak acquisition, consumption of cash after paying a regular distribution to shareholders and by modest cash balances. The liquidity profile benefits from significant cushion under financial covenants and by Compass' ability to monetize assets if needed. The liquidity rating could be lowered to SGL-4 if the proposed refinancing does not close in the next few months. Moody's expects to raise the liquidity rating to SGL-2 if the proposed refinancing closes as proposed. Pro forma for the proposed refinancing, the company has a good liquidity profile. The stable outlook reflects Moody's expectation that Compass will continue to generate strong cash flow before shareholder distributions and will maintain debt/EBITDA between 2 and 3 times and EBITA/interest around 4 times. Moody's expects Compass to continue distributing most of its free cash flow to shareholders. The company's commitment to debt reduction following an acquisition is incorporated in the outlook. There is minimal near term upward rating momentum due to the continuing weak economy. An upgrade would require steady growth in revenues and profitability and moderation of shareholder payouts. Key credit metrics necessary for an upgrade would be debt/EBITDA sustained around 2.5 times and consistent generation of cash flow with sustained RCF/net adjusted debt of at least 20%. The ratings could be downgraded and/or the ratings outlook changed to negative if the proposed refinancing of the secured credit facility does not close in the next few months. A downgrade could also arise if the company revises its business strategy and targets acquisitions that do not have stable cash flow or if Compass increased debt to fund a distribution or share repurchase. Key credit metrics driving a downgrade would be adjusted leverage approaching 4 times for a sustained period, and interest coverage approaching 2 times. The principal methodology used in rating Compass was the Global Consumer Durables rating methodology published in October 2010. Moody's Special Comment, "Analytical Considerations in Assessing Conglomerates" published in September 2007 was also used as an analytical resource. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found on Moody's website. Compass holds majority ownership interests in nine distinct unrelated operating subsidiaries: Advanced Circuits, American Furniture Manufacturing, Anodyne Medical Devices, Fox Factory, Halo Branded Solutions, Staffmark (formerly known as CBS Personnel), Liberty Safe, ERGObaby and Camelbak. Its strategy is to acquire and manage businesses that operate in industries with long term macroeconomic growth opportunities and have positive and stable cash flows. The company reported revenue of approximately $1.8 billion for the twelve months ended June 30, 2011. CRAWFORD FURNITURE: Closes All Five Retail Stores ------------------------------------------------- Emily Lenihan at wivb.com reports that Crawford Retail Outlet is closing all five of its retail stores after filing for Chapter 11 bankruptcy in August. According to the report, the company was to conduct going-out-of- business sales starting Oct. 6, 2011, at its stores located at 6000 South Park Avenue, Hamburg, 5724 South Transit Road, Lockport, 4295 Transit Road, Williamsville, 3366 Sheridan Drive, Amherst, and 185 East Fairmount Avenue, Lakewood. The report relates the company said it will sell everything off its showroom floors at discounted prices. Crawford Retail will endeavor to fill all previous and existing orders and will honor all outstanding gift certificates. Crawford said, "customers who made deposits should visit any of the Crawford Retail stores for details on whether they will be able to receive their merchandise or how to use their deposit credit to be applied to a new purchase." About Crawford Furniture Crawford Furniture Manufacturing Corp., of Jamestown, New York, has been a leading manufacturer for more than 120 years of quality 100% solid wood furniture. Manufacturing was started in 1883 by two Swedish craftsmen and was originally known as the Swedish Furniture Manufacturing Corporation. Manufacturing specializes in the manufacture of bedroom and dining room furniture from solid wood, specifically ash, cherry, maple and oak, that is purchased within a 150-mile radius of its factory in Jamestown. Crawford Furniture Retail Outlet, Inc., has operated five retail stores in western New York since 2004. Retail also operates a warehouse/delivery depot at Benderson Development Park, in Cheektowaga, New York. Crawford Furniture Manufacturing filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Lead Case No. 11-12945) on Aug. 25, 2011. Camille W. Hill, Esq., at Bond, Schoeneck & King, PLLC, serves as the Debtors' counsel. Crawford Furniture Manufacturing estimated assets at $10 million to $50 million and debts at $1 million to $10 million. Retail filed a separate Chapter 11 petition on the same day. The cases are jointly administered. The U.S. Trustee has appointed an official committee of unsecured creditors in the case. CRYOPORT INC: To Offer 2.3MM Common Shares Under Incentive Plan --------------------------------------------------------------- CryoPort, Inc., filed with the U.S. Securities and Exchange Commission a Form S-8 registration statement registering $2,300,000 shares of common stock at a proposed maximum offering price of $2.43 million. The shares represents shares of common stock reserved for issuance upon the exercise of stock options and grant of stock awards that may be granted under the 2011 Stock Incentive Plan. A full-text copy of the Form S-8 is available for free at http://is.gd/LgNuYZ About CryoPort Inc. Headquartered in Lake Forest, Calif., CryoPort, Inc. (OTC BB: CYRXD) -- http://www.cryoport.com/-- provides innovative cold chain frozen shipping system dedicated to providing superior, affordable cryogenic shipping solutions that ensure the safety, status and temperature of high value, temperature sensitive materials. The Company has developed a line of cost-effective reusable cryogenic transport containers capable of transporting biological, environmental and other temperature sensitive materials at temperatures below 0-degree Celsius. The Company's balance sheet at June 30, 2011, showed $8.68 million in total assets, $4.59 million in total liabilities, and $4.08 million in total stockholders' equity. KMJ Corbin & Company LLP expressed substantial doubt about CryoPort's ability to continue as a going concern, following the Company's fiscal 2009 results. The firm noted that the Company has incurred recurring losses and negative cash flows from operations since inception. CRYSTAL CATHEDRAL: Founder Fights Suit Lodged by Committee ---------------------------------------------------------- The Los Angeles Times reports that Crystal Cathedral founder Robert H. Schuller on Oct. 4, 2011, disputed allegations in a lawsuit filed by the church's creditors' committee. According to the report, the lawsuit seeks to pay church insiders -- including Mr. Schuller, his wife, Arvella, daughters Carol and Jeanne and their husbands, son Robert Anthony and his wife -- last upon the sale of the Garden Grove campus. The lawsuit also includes former Chief Financial Officer Fred Southard, who resigned in January. Mr. Schuller said that actions by the church's board of directors were undertaken in "good faith" and with the best interests of the church in mind. He said the ministry board also has been held accountable to an audit committee, which no family members have ever been a part of. "This lawsuit makes serious and untrue allegations regarding myself and my family," LA Times quotes Mr. Schuller as stating. "It is unfortunate that I will have to defend this lawsuit only to prove what is true." LA Times, citing court documents, says the lawsuit alleges that, before filing for Chapter 11 almost one year ago, church officials borrowed about $10 million from an endowment fund from 2002 to 2009. It also outlines various agreements between family members and the church, which include a contract that entitled Mr. Schuller to a $300,000 annual discretionary fund plus health insurance and travel staff for the rest of his life. The report says contracts between other family members are also referenced in the suit, including an agreement to provide a Mercedes-Benz for Robert Anthony's new church and to provide Paul Dunn, Mr. Schuller's son-in-law and producer for the church's annual pageants, round-trip tickets from his home in Hawaii to California, as well as a $20,000 license fee for each play. The lawsuit also alleges that Mr. Dunn was paid even though the pageants were cancelled in 2009 and 2010. The report relates that Nanette Sanders, Esq., the attorney for the creditors' committee, said in an e-mail that she has not seen Mr. Schuller's statement, but said the complaint was filed based upon information obtained from Crystal Cathedral Ministries during the course of the bankruptcy case, or received from third parties. Mr. Schuller said a vast number of creditors have sold their claims to "various spectators who are attempting to make a return if the ministry's campus is sold." In late July, church officials announced they would withdraw their plan to sell, and instead raise the money needed -- more than $50 million -- to pay off debts. In August, the committee filed a potential bankruptcy exit plan for the church, which includes selling the Garden Grove campus. So far, the Roman Catholic Diocese of Orange and Chapman University are top contenders, with bids of $53.6 million and $50 million, respectively. The plan is for a buyer to be chosen by Halloween. About Crystal Cathedral Crystal Cathedral Ministries is a Southern California-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Mr. Schuller retired from his role as senior pastor of Crystal Cathedral in 2006. His daughter Sheila Schuller Coleman has been senior pastor since July 2009. Contributions declined 24% in 2009, in part on account of "unsettled leadership." Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. Marc J. Winthrop, Esq., at Winthrop Couchot P.C. represent the Debtor. Todd C. Ringstad, Esq., at Ringstad & Sanders, LLP, represents the Official Committee of Unsecured Creditors. CYBERDEFENDER CORP: Guthy-Renker Discloses 40.6% Equity Stake ------------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Guthy-Renker Partners, Inc., Guthy-Renker Holdings, LLC, Guthy-Renker LLC and GR Match, LLC, disclosed that they beneficially own 17,097,789 shares of common stock of Cyberdefender Corporation representing 40.6% of the shares outstanding. A full-text copy of the filing is available for free at http://is.gd/n2Uj2Z About CyberDefender Los Angeles, Calif.-based CyberDefender Corporation is a provider of remote LiveTech services and security and computer optimization software and to the consumer and small business market. The Company's mission is to bring to market advanced solutions to protect computer users against Internet viruses, spyware, identity theft and related security threats. The Company's balance sheet at June 30, 2011, showed $7.9 million in total assets, $40.6 million in total liabilities, and a stockholders' deficit of $32.7 million. May Consider Bankruptcy "We are presently engaged in active discussions for additional investments by existing and prospective investors but we have no funding commitments in place at this time and we can give no assurance that such capital will be available on favorable terms, or at all. If we cannot obtain financing, then we may be forced to further curtail our operations, or possibly be forced to evaluate a sale or consider other strategic alternatives such as bankruptcy," the Company said in Form 10-Q for the quarter ended June 30, 2011. DENBURY RESOURCES: Moody's Affirms 'Ba3' Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service changed Denbury Resources, Inc.'s (Denbury) rating outlook to negative from stable following the company's announcement that it has approved a share buyback program for up to $500 million. At the same time, Moody's affirmed Denbury's Ba3 Corporate Family Rating (CFR) and assigned Denbury a Speculative Grade Liquidity Rating of SGL-3. Moody's also affirmed Denbury's Ba3 Probability of Default Rating and the B1 rating on its senior subordinated notes. RATINGS RATIONALE "The negative rating outlook reflects Moody's concern that Denbury $500 million share repurchase program marks a divergence in financial policies and could further pressure financial leverage to a level outside a range appropriate for the Ba3 Corporate Family Rating," said Gretchen French, Moody's Vice President. Denbury expects to finance the share buyback program through a combination of cash flow from operations and borrowings under its $1.6 billion bank credit facility. In addition, the company intends to reduce capital expenditures in 2012 by an equivalent amount of the buybacks. The affirmation of the Ba3 CFR reflects the benefit of Denbury's high proportion of oil production and strong leveraged cash margins. Liquids production comprised 92% of total production in the second quarter of 2011, and Moody's expects Denbury's leveraged cash margins to be in the $37/boe range in 2012. In addition, the company has considerable scale for the Ba3 rating and a long-lived production profile. However, the company's financial leverage currently is at the high end of the range for the Ba3 rating and debt financed share buybacks would further increase this leverage profile. As of June 30, 2011 and pro forma for the Riley Ridge transaction, debt/proved developed reserves was $11.75/boe and debt/production was $43,001/boe. Debt-financed share buybacks will further increase this leverage profile without adding reserves or potential production growth. If the company were to debt finance $500 million of share buybacks, this would result in debt/PD reserves increasing to $13.86/boe and debt/production increasing to $50,703/boe. Leverage trends in 2011 have been somewhat higher than originally anticipated due to the outspending of cash flow, the debt financing of the remaining interest in Riley Ridge and production growth modestly lower than projected. The company has revised down its 2011 production growth outlook (5% growth vs. 8% growth) as a result of slower development in certain tertiary floods and inclement weather in the Bakken. The company expects higher production growth in 2012, particularly as tertiary production ramps up at Hastings and Oyster Bayou. However, Moody's notes that tertiary production can be inconsistent and difficult to accurately predict due to the heterogeneity of the reservoirs and long-lead time for a production response. In addition, production growth and reserve additions also could be negatively impacted by the capital reduction in 2012 associated with the buyback program. Denbury's SGL-3 rating reflects adequate liquidity through 2012, even with the assumption of up to $500 million in debt financed share buybacks. The company has a $1.6 billion borrowing base revolving bank credit facility that matures in 2016. As of September 30, 2011, $110 million in cash drawings were outstanding on the credit facility. The company is expected to be well within the maintenance covenants under the revolving credit facility, ensuring access during the next four quarters. Denbury has certain unencumbered assets and believes that its reserve profile is indicative of a significantly larger borrowing base, providing a degree of flexibility for alternate sources of liquidity. There are no significant long term debt maturities until 2016. The ratings could be downgraded if Denbury's leverage on PD reserves exceeds $13.00/boe and the company is unable to restore debt/average daily production trends below $40,000/boe. Conversely, the outlook could be stabilized if Denbury is successful in maintaining leverage on PD reserves in the $10/boe range and debt/average daily production in the $35,000/boe range. Over the longer term, an upgrade would be considered if Denbury reduces its leverage on PD reserves to less than $8.00/boe on a sustainable basis and debt/average daily production is less than $30,000/boe while maintaining its positive production trends and good margins. The principal methodology used in rating Denbury Resources was the Independent Exploration and Production (E&P) Industry Methodology published in December 2008. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Denbury Resources, Inc. is headquartered in Plano, Texas. DEX ONE: Moody's Downgrades Corporate Family Rating to 'B3' ----------------------------------------------------------- Moody's Investors Service has downgraded the corporate family rating (CFR) for Dex One Corporation's ("Dex One" or "the company") to B3 from B1. The downgrade reflects Moody's doubts that the company will be able to transition its business away from a reliance on print directories quickly enough to stabilize its revenues and earnings. Consequently, Moody's expects that the relatively robust levels of free cash flow that the company is currently generating will decline at an accelerating pace over time. Moody's ratings outlook for Dex One remains negative. Moody's has taken these rating actions: Issuer: Dex One Corp. -- Outlook: Negative, unchanged -- Corporate Family Rating: B3 from B1 prior -- Probability of Default Rating: B3 from B1 prior -- Senior Subordinate: Caa2 -- LGD6 (94%) from B3 -- LGD6 (95%) prior -- Speculative Grade Liquidity: SGL-2, unchanged Issuer: R.H. Donnelley Inc. -- Senior Secured Bank Credit Facility: B2 -- LGD3 (42%) from B1 -- LGD3 (43%) prior Issuer: Dex Media East LLC -- Senior Secured Bank Credit Facility: B2 -- LGD3 (42%) from B1 -- LGD3 (43%) prior Issuer: Dex Media West LLC -- Senior Secured Bank Credit Facility: B2 -- LGD3 (42%) from Ba3 -- LGD3 (42%) prior RATINGS RATIONALE Moody's estimates that the directory publishing industry is lagging behind other print-based media sectors, some of which will return to growth this year. Dex One's year-over-year ad sales were down 15% in 2Q'11 and Moody's anticipates another double-digit percentage decline in ad sales for directory publishers this year and next year. Dex One is attempting to reinvent its business by reducing its reliance on print advertising through the development of online and mobile directory service applications. The company's recent announcement to partner with Google is a positive step in this direction but Moody's doubts that the company will be able to effect this change at a pace that would allow it to stabilize its revenues over the intermediate term. Furthermore, Moody's notes that the initiative to reinvent the business will require investment that will offset the company's efforts to lower the cost structure of its legacy business. Earlier this year the company announced a plan to cut costs by $125 million. Dex One has good liquidity based on Moody's projection of $215 million in cash at year end 2011 and continued positive free cash flow. Similar to its competitors, the company requires minimal capital investment, well below internally generated cash flows. Rating Outlook The negative rating outlook reflects Moody's belief that the amount of free cash flow generated will decline at an accelerating pace due to structural challenges the print directory industry faces as consumers transition toward on-line and mobile advertising channels coupled with Moody's concerns that Dex's ability to cut costs in the legacy print business have diminished. What Could Change the Rating - Down If revenue continues to decline at a double digit percentage pace or if liquidity weakens the ratings could be lowered. Specifically, the ratings could be downgraded further if debt-to- EBITDA is likely to remain above 4.75x or if free cash flow-to- debt remains below 8% for an extended period of time. What Could Change the Rating -- Up Although unlikely given the continuing negative outlook, Dex's ratings could be upgraded if revenue and earnings pressure eases and the company makes a successful transition away from a reliance on print directories while maintaining good liquidity position. Specifically, if Dex is able to sustain debt-to-EBITDA leverage below 3.75x and free cash flow-to-debt in a double digit range, its ratings could be positively impacted. Moody's last rating action was on January 26, 2010 when the company's ratings were assigned following its exit from bankruptcy restructuring. Dex One'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 Dex One's core industry and believes Dex One's ratings are comparable to those of other issuers with similar credit risk. Dex One, headquartered in Cary, North Carolina, is a local business marketing services company that includes print directories and online voice and mobile search. Revenue was approximately $1.6 billion (pro forma) for the LTM period ended June 30, 2011. DK AGGREGATES: Has Until Oct. 17 to File Amended Plan Outline ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Mississippi gave DK Aggregates LLC until Oct. 17, 2011, to file an amended disclosure statement explaining the proposed Chapter 11 Plan. The ruling was in response to the objections filed by creditors Hancock Bank, Three Deuces, Inc., Mass P. Blackwell, and Blackwell Aggregates, Inc. As reported in the Troubled Company Reporter on July 25, 2011, the Plan proposes to pay 100% to all claim-holders except that the percentage recovery of holders of damage suits or torts is limited to policy limits under the proposed plan. Among others, unsecured creditors, owed $1.75 million, will receive 10 equal payments, first commencing four months after the plan's effective date, and ever six months thereafter, until all claims haven been satisfied. Secured claim of Hancock Bank will be payable under a 20-year amortization with interest accruing at 6% per annum, with monthly payments of $10,542. Monthly payments will commence on the 20th of the months immediately after the plan's effective date. On the 60th month after the effective date, the loan will mature and will be due and payable in full. The adequate protection payments presently being made under order of the Court will cease on the effective date. About DK Aggregates LLC Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter 11 bankruptcy protection (Bankr. S.D. Miss. Case No. 10-51823) on Aug. 9, 2010. Robert Alan Byrd, Esq., at Byrd & Wiser, assists the Debtor in its restructuring effort. H. Kenneth Lefoldt, Jr., of Lefoldt & Company P.A. serves as accountant. The Debtor disclosed assets of $17,025,695 and liabilities of $7,004,953 as of the petition date. The Troubled Company Reporter reported on June 22, 2011, that the Debtor disclosed $18,529,695 in assets and $7,114,925 in liabilities. DONSON GROUP: Case Summary & 4 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Donson Group, Ltd. 197 Eighth Street, Suite 850 Boston, MA 02129 Bankruptcy Case No.: 11-13700 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court District of New Hampshire (Manchester) Judge: J. Michael Deasy Debtor's Counsel: Jennifer Rood, Esq. Robert J. Keach, Esq. BERSTEIN, SHUR, SAWYER & NELSON 670 N. Commercial St., Ste 108 P.O. Box 1120 Manchester, NH 03105-1120 Tel: (603) 623-8700 Fax: (603) 623-7775 E-mail: jrood@bernsteinshur.com rkeach@bernsteinshur.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nhb11-13700.pdf The petition was signed by Iris A. Mitropoulis, president. Affiliates that filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- Kingsbury Corporation 11-13671 09/30/11 Ventura Industries, LLC 11-13687 09/30/11 DRYSHIPS INC: Adjusts Conversion Price of Convertible Notes ----------------------------------------------------------- DryShips Inc. announced that the applicable conversion price under the Indenture and related Supplemental Indenture governing the Company's 5.00% Convertible Senior Notes due Dec. 1, 2014, has been adjusted to $6.90 per share effective as of Sept. 19, 2011. The previous conversion price of $7.19 per share was adjusted downward in connection with the Company's partial spin off Ocean Rig UDW Inc. which is expected to be completed on Oct. 5, 2011. About DryShips Inc. Based in Greece, DryShips Inc. -- http://www.dryships.com/-- -- owns and operates drybulk carriers and offshore oil deep water drilling units that operate worldwide. As of Sept. 10, 2010, DryShips owns a fleet of 40 drybulk carriers (including newbuildings), comprising 7 Capesize, 31 Panamax and 2 Supramax, with a combined deadweight tonnage of over 3.6 million tons and 6 offshore oil deep water drilling units, comprising of 2 ultra deep water semisubmersible drilling rigs and 4 ultra deep water newbuilding drillships. DryShips's common stock is listed on the NASDAQ Global Select Market where it trades under the symbol "DRYS". On Nov. 25, 2010, DryShips Inc. entered into a waiver letter for its US$230.0 million credit facility dated Sept. 10, 2007, as amended, extending the waiver of certain covenants through Dec. 31, 2010. In its audit report on the Company's financial statements for the year ended Dec. 31, 2010, Deloitte, Hadjipavlou Sofianos & Cambanis S.A., noted that the Company's inability to comply with financial covenants under its original loan agreements as of Dec. 31, 2009, its negative working capital position and other matters raise substantial doubt about its ability to continue as a going concern. The Company's balance sheet at June 30, 2011, showed US$7.86 billion in total assets, US$4.03 billion in total liabilities, and US$3.83 billion in total equity. DUARTE, CALIF: S&P Lowers Rating on Series 1997A Bonds to 'BB' -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term rating on Duarte, Calif.'s (Heritage Park Apartments) Fannie Mae collateralized multifamily housing revenue bonds series 1997A to 'BB' from 'BB+'. "The downgrade is based on our view of the project's reliance on short-term market rate investments, falling parity, and insufficient funds to cover reinvestment risk based on the 30-day minimum notice period in the event of prepayment by 2017," said Standard & Poor's credit analyst Stephanie Wang. "The rating also reflects our view of the sufficient revenues from mortgage debt service payments and investment earnings to pay full and timely debt service on the bonds until maturity," S&P related. "Credit strengths for this issue include our opinion of high credit quality of the Fannie Mae pass-through certificates, which we consider to be 'AA+' eligible, and investments held in First American Treasury Obligations Fund Class D money market fund," S&P said. Standard & Poor's has analyzed the updated financial statements based on the revised criteria for certain federal government- enhanced housing transactions. "Based on our current stressed reinvestment rate assumptions for all scenarios as set forth in the related criteria articles, we believe the bonds are able to meet all bond costs from transaction revenues until maturity," S&P related. DUNE ENERGY: Enters Into Restructuring Plan Support Agreement ------------------------------------------------------------- Dune Energy, Inc. has entered into a restructuring plan support agreement with noteholders who together hold approximately 90% of the aggregate principal amount of Dune's outstanding 10-1/2% Senior Secured Notes due 2012 as well as a similar restructuring plan support agreement with a holder of approximately 64% of Dune's issued and outstanding 10% Senior Redeemable Convertible Preferred Stock. Pursuant to the support agreement, which sets forth the terms of Dune's capital restructuring plan, Dune intends to seek to eliminate all of the notes and the related cash interest expense, through consummation of an exchange offer to acquire all the notes in exchange for a combination of Dune equity securities, and either cash or new debt securities in an aggregate amount of $50 million. If fully subscribed, the exchange offer would result in the ownership of 97.25% of Dune's common stock on a post-restructuring basis by the noteholders. The support agreements also contemplate conversion of all of the outstanding preferred stock into $4.0 million in cash and 1.5% of Dune's common stock on a post-restructuring basis. In addition, the contemplated restructuring would result in Dune's current common stockholders holding 1.25% of Dune's common stock on a post- restructuring basis. Dune plans to launch this out-of-court exchange offer as soon as practical, but no later than November 1, 2011. As an alternative to the out-of-court exchange offer, Dune has also agreed in the support agreements to solicit consents from its noteholders to approve a prepackaged plan of reorganization in a bankruptcy proceeding. In the event certain conditions to the exchange offer are not satisfied, Dune intends to pursue the prepackaged plan. If confirmed, the prepackaged plan would have principally the same effect as if 100% of the noteholders had tendered their notes in the exchange offer. If all conditions to consummating the exchange offer are satisfied, Dune will cease seeking support for the prepackaged plan. Dune does not anticipate any business interruption in its operations during the restructuring process, regardless of whether the restructuring is completed out of court or in court. Under the proposed plan, Dune will continue its operations in the normal course. All vendors and suppliers will continue to be paid in full under normal terms in the ordinary course of business. The proposed plan contemplates a refinancing of Dune's senior secured term loan, and provides that all of Dune's creditor classes, including general unsecured creditors, will be "unimpaired" - i.e., will be paid in full for all valid, outstanding claims upon consummation of the plan to the extent they have not been paid previously; however there can be no assurance that the treatment of creditors outlined above will not change significantly. Implementation of the transactions contemplated by the support agreements are dependent on a number of factors and approvals. Pursuant to their support agreement, the supporting noteholders have agreed to, among other things, (1) support and use commercially reasonable efforts to complete the capital restructuring plan, including by tendering their notes into the exchange offer and voting in favor of the prepackaged plan; and (2) not exercise remedies or direct the trustee to exercise remedies under the indenture governing the notes for any default or event of default that has occurred or may occur thereunder. However, the support agreement may be terminated upon the occurrence or failure to occur of certain events generally related to progress towards consummation of the restructuring. Additional details related to the restructuring plan can be found in the restructuring support agreements, which will included as an exhibit to Dune's Current Report on Form 8-K filed with the Securities and Exchange Commission. About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company reported a net loss of $75.53 million on $64.18 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $59.13 million on $52.24 million of revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $274.23 million in total assets, $369.71 million in total liabilities, $151.29 million in redeemable convertible preferred stock, and a $246.78 million total stockholders' deficit. * * * Dune Energy carries a 'CCC-' corporate credit rating, with negative outlook, from Standard & Poor's, and 'Ca' corporate family and probability of default ratings, with negative outlook, from Moody's Investors Service. S&P said in April 2010, "[T]he company's heavy debt burden makes the prospects of a distressed exchange or bankruptcy a distinct possibility." DUNKIN' BRANDS: S&P Raises Corporate Credit Rating to 'B+' ---------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Dunkin' Brands Inc. to 'B+' from 'B'. The outlook is stable. At the same time, Standard & Poor's raised its issue-level rating on the company's senior secured bank credit facilities to 'B+' (same as the corporate credit rating) from 'B'. The recovery rating remains at '3', indicating the expectation of meaningful recovery (at the high end of the 50%-70% range) in the event of a payment default. Standard & Poor's also withdrew its ratings on the company's $625 million senior unsecured notes following their redemption. "The 'B+' rating on Dunkin' Brands reflects the meaningful improvement in the company's credit protection measures following the completion of its IPO and subsequent repayment of debt. We expect the company's leverage ratio to strengthen over the next year, as new store openings and menu offerings augment earnings and Dunkin' uses excess cash flows to reduce debt," said Standard & Poor's credit analyst Andy Sookram. "Dunkin' Brands' financial risk profile strengthened as a result of its recent IPO but, in our view, remains highly leveraged," he continued. The stable outlook reflects the company's resilient operations. Standard & Poor's view stems from the company's high proportion of revenues derived from its franchised operations and benefits from store expansion initiatives, which will help to keep credit measures in line with the higher rating. The company plans to open approximately 500 stores in 2011 and 600 stores in 2012, which should increase its EBITDA margin. DUTCH RESOURCES: Signs Mining Lease Pact with Bilbray & Johnston ---------------------------------------------------------------- Dutch Gold Resources, Inc., on Sept. 26, 2011, entered into a Mining Lease Agreement with the Bilbray Trust and the Johnston Trust for the Minnie Moore Mine located in Blaine County, Idaho. Pursuant to the Agreement, the Company was granted a license to use the Property for the purpose of exploring, evaluating, developing, mining and all necessary associated activities commensurate with that exploration and mining for an initial period of ten years and two ten year extension periods. The Agreement provides for an annual lease payment of $50,000 for the second half of the initial term, $75,000 for the third five year period and $100,000 for the fourth five year period. The Company is also required to make advance production payments of $10,000 per month. Upon commencement of the production of ore from the Property, in addition to the Advance Production Payment, the Company will pay to the Trusts the greater of $10,000 paid monthly or a net smelter royalty of 4.00% of the funds paid from the smelter to the Company. The Company will also pay to the Trusts a profit participation fee of 14.00% of the net profits of production of ore from the Property. In consideration of the lease, the Company granted options to each of the Trusts to purchase 5,250,000 shares of the Company's common stock at the exercise price of $1,000.00. The options shall vest when operations from the mine have generated net revenues of $10,000,000. The Company was also granted the right to purchase the Property for the purchase price of $15,000,000. Any payments made to the Trusts from the production of ore at the Property, including Advance Profit Payments, Net Smelter Royalties or Profit Participation, would be applied against the Purchase Price On Sept. 27, 2011, the Company and its wholly-owned subsidiary, DGRI Mining Services Corporation, entered into a Consulting Agreement with Carl Johnston for services to the Company related to the exploration, development and production of precious metals from the Property. The agreement provides for compensation in the amount of $5,000 per month and the term of the consulting agreement is for one year and is automatically renewed unless cancelled by either party. A full-text copy of the Mining Lease Agreement is available for free at http://is.gd/9bRjBd About Dutch Gold Based in Atlanta, Ga., Dutch Gold Resources, Inc. (OTC: DGRI) -- http://www.dutchgoldresources.com/-- is a junior gold miner focused on developing its existing mining properties in North America and acquiring and developing new mines that can enter into production in 12 to 24 months. The Company's balance sheet at June 30, 2011, showed $3.41 million in total assets, $7.08 million in total liabilities, and a $3.67 million total stockholders' deficit. As of June 30, 2011, the Company had cash on hand of $21,425, investments available for sale of $366,645, a working capital deficit of approximately $5.2 million and has incurred a loss from operations for the six months ended June 30, 2011. The Company reported a net loss of $3.70 million on $0 of revenue for the year ended Dec. 31, 2010, compared with a net loss of $11.33 million on $0 of revenue during the prior year. As reported, Hancock Askew & Co., LLP, in Atlanta, Georgia, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has limited liquidity and has incurred recurring losses from operations. EDWARD DEETS: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Edward Deets Holding Company, Inc 484 South Mountain Boulevard Mountain Top, PA 18707 Bankruptcy Case No.: 11-06869 Chapter 11 Petition Date: October 6, 2011 Court: U.S. Bankruptcy Court Middle District of Pennsylvania (Wilkes-Barre) Judge: John J. Thomas Debtor's Counsel: Jeffrey Dean Servin, Esq. 1500 Market Street, 12th Floor East Tower, Centre Square Philadelphia, PA 19102 Tel: (215) 665-1212 Fax: (215) 654-0357 E-mail: JDServin@comcast.net Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Edward Deets, president. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Edward Deets & Elizabeth Deets 11-06868 10/06/11 ELEPHANT TALK: Del. State Secretary Favors Certificate of Merger ---------------------------------------------------------------- Elephant Talk Communications, Inc., on Sept. 30, 2011, received notification that its certificate of merger of Elephant Talk Communications, Inc., a California corporation, into Elephant Talk Communications Corp., a Delaware corporation, was accepted by the Delaware Secretary of State on Sept. 26, 2011. The Certificate of Merger was filed with the California Secretary of State on Sept. 26, 2011. Pursuant to the Certificate of Merger, the Company was merged with and into ETAK Delaware such that the Company is now a Delaware corporation. The mechanism of the Reincorporation, reasons for the Reincorporation and comparison of the certificate of incorporations and bylaws of the Company and ETAK, the surviving company, were outlined in the Company's definitive proxy statement filed with the Securities and Exchange Commission on July 26, 2011. A full-text copy of the Certificate of Merger is available at no charge at http://is.gd/KJT4pI About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. The Company reported a net loss of $92.48 million on $37.17 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $17.30 million on $43.65 million of revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $51.24 million in total assets, $14.14 million in total liabilities, and $37.09 million in total stockholders' equity. As reported by the TCR on April 6, 2011, BDO USA, LLP, noted that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. As of Dec. 31, 2010, the Company incurred a net loss of $92.5 million, used cash in operations of $14.1 million and had an accumulated deficit of $154.8 million. EMMIS COMMUNICATIONS: Extends P. Walsh's Employment to 2013 ----------------------------------------------------------- Emmis Communications Corporation, on Oct. 3, 2011, entered into a new employment agreement with Patrick Walsh, effective Sept. 4, 2011, who will continue to serve as Executive Vice President, Chief Financial Officer and Chief Operating Officer, extending his employment through Sept. 3, 2013. Mr. Walsh's annual base compensation for the term of the employment agreement is $600,000. Mr. Walsh's annual incentive compensation targets for fiscal years 2012, 2013, and 2014 continue to be 100% of his base compensation. In the event that Mr. Walsh's employment terminates upon expiration of the employment agreement, Mr. Walsh's annual incentive compensation for fiscal year 2014 will be pro-rated. The company retains the right to pay any annual incentive compensation in cash or shares of the Company's common stock. Additionally, the award of annual incentive compensation is based upon achievement of certain performance goals to be determined each year by the Company's Compensation Committee. On Sept. 8, 2011, Mr. Walsh received an option to acquire 250,000 shares of the Company's Class A Common Stock. Mr. Walsh is also scheduled to receive a completion bonus upon the expiration of the agreement equal to at least $500,000, with additional targets of $800,000 and $1,200,000 based upon certain increases in share price set forth in the employment agreement. Mr. Walsh will receive an automobile allowance of $1,000 per month and will be reimbursed for up to $5,000 per year in premiums for life and disability insurance and professional fees related to estate planning. Mr. Walsh retains the right to participate in all of the Company's employee benefit plans for which he is otherwise eligible. The agreement remains subject to termination by the Company's board of directors for cause, and by Mr. Walsh for good reason upon written notice. Mr. Walsh is entitled to certain termination benefits upon disability or death, and certain severance benefits. Also on Sept. 30, the Compensation Committee approved the payment of certain bonuses to key participants in the Merlin Media transaction, including payments to Jeffrey H. Smulyan, Patrick M. Walsh and Richard E. Cummings in amounts equal to 125%, 45% and 12%, respectively, of their current base salaries. About Emmis Communications Headquartered in Indianapolis, Indiana, Emmis Communications Corporation -- http://www.emmis.com/-- owns and operates 22 radio stations serving New York, Los Angeles, Chicago, St. Louis, Austin, Indianapolis, and Terre Haute, as well as national radio networks in Slovakia and Bulgaria. The company also publishes six regional and two specialty magazines. The Company reported a consolidated net loss of $11.54 million on $251.31 million of net revenues for the year ended Feb. 28, 2011, compared with a consolidated net loss of $118.49 million on $242.56 million of net revenues during the prior year. The Company's balance sheet at May 31, 2011, showed $470.91 million in total assets, $474.41 million in total liabilities, $140.46 million in Series A Cumulative Convertible Preferred Stock, and a $143.96 million total deficit. * * * In November 2010, Moody's Investors Service affirmed the 'Caa2' Corporate Family Rating and 'Caa3' Probability of Default rating for Emmis Communications Corporation, as well as its SGL-4 speculative grade liquidity rating. Operating performance improved with the economic recovery, but absent debt reduction with proceeds from an asset sale or equity infusion Emmis will likely breach its leverage covenant when the covenant suspension period ends for the quarter ending November 30, 2011, in Moody's opinion. Emmis' CFR and PDR incorporate expectations for a covenant breach in November 2011. Moody's considers the Company's capital structure unsustainable, and its operations in the cyclical advertising business magnify this challenge. Furthermore, Emmis relies on two markets, Los Angeles and New York, for approximately 50% of its revenue, although its ownership of stations in top markets including Chicago as well as NY and LA, support the rating. The negative outlook incorporates Moody's expectations that Emmis will not comply with its maximum leverage covenant when effective for the quarter ending November 30, 2011. ENER1 INC: Charles Gassenheimer Resigns as Director --------------------------------------------------- Charles Gassenheimer resigned as a member of the Board of Directors of Ener1, Inc., on Sept. 30, 2011. On Oct. 4, 2011, the Board voted to not fill the director vacancy created by Mr. Gassenheimer's resignation and voted to decrease the number of directors of the Board from ten to nine. About Ener1 Ener1 Inc. (OTCBB: ENEI) -- http://www.ener1.com/-- has three business lines, which the company conducts through three operating subsidiaries. EnerDel, an 80.5% owned subsidiary, which is 19.5% owned by Delphi, develops Li-ion batteries, battery packs and components such as Li-ion battery electrodes and lithium electronic controllers for lithium battery packs. EnerFuel develops fuel cell products and services. NanoEner develops technologies, materials and equipment for nanomanufacturing. On Aug. 15, 2011, Ener1 disclosed that the Company's financial statements for the year ended December 31, 2010 and for the quarterly period ended March 31, 2011 should no longer be relied upon and should be restated. The determination was made following an assessment of certain accounting matters related to the loans receivable owed to Ener1 by Think Holdings and accounts receivable owed to Ener1 by Think Global held by the Company, and the timing of the recognition of the impairment charge related to the Company's investment in Think Holdings originally recorded during the quarter ended March 31, 2011. Ener1 in September 2011 announced that it has entered into an agreement to restructure its 8.25% Senior Amortizing Notes with Goldman Sachs Asset Management, L.P., and other holders of the Notes. Ener1 also announced that its primary shareholder, BzinFin S.A., has extended the maturity of its $15-million line of credit from November 2011 to July 2013. The Company and Bzinfin S.A., on Sept. 12, 2011, entered into an amendment to the Line of Credit Agreement dated June 29, 2011. Under the LOC Agreement, Bzinfin established a line of credit for the Company in the aggregate principal amount of $15,000,000, of which approximately $11,241,000 has been borrowed by the Company. Under the terms of the Amendment, the maturity date for the repayment of all advances under the LOC Agreement and all unpaid accrued interest thereon was extended to July 2, 2013, and the interest rate at which all outstanding advances will bear interest from and after Sept. 12, 2011, was increased to 15% per year. ENER1 INC: Pomerantz Reminds Shareholders of Oct. 17 Deadline ------------------------------------------------------------- Shareholders of Ener1, Inc. are reminded of the securities class action lawsuit filed against Ener1 and certain of its officers. The class action (Civil Action No. 11 Civ. 5795) in the United States Southern District Court of New York is on behalf of a class consisting of all persons or entities who purchased Ener1 securities between January 10, 2011 and August 15, 2011, both dates inclusive. The Complaint alleges violations of Sections 10(b) and 20(a) of the Exchange Act, 15 U.S.C. Sections 78j(b) and 78t(a); and SEC Rule 10b-5 promulgated thereunder by the SEC, 17 C.F.R. Section 240.10b-5. If you are a shareholder who purchased Ener1 securities during the Class Period, you have until October 17, 2011 to ask the Court to appoint you as Lead Plaintiff for the class. The Complaint charges Ener1 and certain of its executive officers and/or directors with violations of federal securities laws. Ener1 designs, develops and manufactures high-performance batteries and battery pack systems. In 2009 and 2010, Ener1 made separate investments in electric-vehicle manufacturer Think Global, AS and its majority owner Think Holdings, AS. The Complaint alleges that throughout the Class Period defendants made false and/or misleading statements and/or failed to disclose that, among other things: (1) Think Global lacked adequate operating capital, and the ability to raise capital, to continue operations; (2) as a result, Ener1 failed to timely impair the value of its Think Holdings investments; (3) as a result, the outstanding loans receivable and accounts receivable due from Think Holdings and Think Global were uncollectible; (4) as such, the Company's financial statements were misstated and its financial results were not prepared in accordance with Generally Accepted Accounting Principles ("GAAP"); and (5), as a result, the Company's financial statements were materially false and misleading at all relevant times. On June 22, 2011, the Company disclosed that a material charge was required under GAAP applicable to Ener1 related to the loans receivable of Think Holdings and accounts receivable of Think Global held by Ener1, based on the announcement by Think Global that, following an extended and ultimately unsuccessful search for long-term financing, it would be filing for bankruptcy proceedings in the Norwegian courts on June 22, 2011. Ener1 estimated the amount of the charge would be $35.4 million, subject to change to the extent that the Company received any recovery as a result of the liquidation of Think Global, but any recovery, to the extent it occurred, would not likely be significant. On this news, shares of Ener1 declined $0.07 per share, more than 5%, on unusually heavy volume, and further declined $0.16 per share, or 12.4%, to close on June 23, 2011, at $1.13 per share, also on unusually heavy volume. Subsequently, on August 15, 2011, Ener1 disclosed that the Company's financial statements for the year ended December 31, 2010 and for the quarterly period ended March 31, 2011 should no longer be relied upon and should be restated. The determination was made following an assessment of certain accounting matters related to the loans receivable owed to Ener1 by Think Holdings and accounts receivable owed to Ener1 by Think Global held by the Company, and the timing of the recognition of the impairment charge related to the Company's investment in Think Holdings originally recorded during the quarter ended March 31, 2011. On this news, shares of Ener1 declined $0.33 per share, or 42.31%, to close on August 16, 2011, at $0.45 per share, on unusually heavy volume. The Pomerantz Firm -- http://www.pomerantzlaw.com/--, with offices in New York, Chicago and Washington, D.C., is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. About Ener1 Ener1 Inc. (OTCBB: ENEI) -- http://www.ener1.com/-- has three business lines, which the company conducts through three operating subsidiaries. EnerDel, an 80.5% owned subsidiary, which is 19.5% owned by Delphi, develops Li-ion batteries, battery packs and components such as Li-ion battery electrodes and lithium electronic controllers for lithium battery packs. EnerFuel develops fuel cell products and services. NanoEner develops technologies, materials and equipment for nanomanufacturing. On Aug. 15, 2011, Ener1 disclosed that the Company's financial statements for the year ended December 31, 2010 and for the quarterly period ended March 31, 2011 should no longer be relied upon and should be restated. The determination was made following an assessment of certain accounting matters related to the loans receivable owed to Ener1 by Think Holdings and accounts receivable owed to Ener1 by Think Global held by the Company, and the timing of the recognition of the impairment charge related to the Company's investment in Think Holdings originally recorded during the quarter ended March 31, 2011. Ener1 in September 2011 announced that it has entered into an agreement to restructure its 8.25% Senior Amortizing Notes with Goldman Sachs Asset Management, L.P., and other holders of the Notes. Ener1 also announced that its primary shareholder, BzinFin S.A., has extended the maturity of its $15-million line of credit from November 2011 to July 2013. The Company and Bzinfin S.A., on Sept. 12, 2011, entered into an amendment to the Line of Credit Agreement dated June 29, 2011. Under the LOC Agreement, Bzinfin established a line of credit for the Company in the aggregate principal amount of $15,000,000, of which approximately $11,241,000 has been borrowed by the Company. Under the terms of the Amendment, the maturity date for the repayment of all advances under the LOC Agreement and all unpaid accrued interest thereon was extended to July 2, 2013, and the interest rate at which all outstanding advances will bear interest from and after Sept. 12, 2011, was increased to 15% per year. EVERGREEN ENERGY: Receives $30-Mil. Offer for K-Fuel Business ------------------------------------------------------------- Evergreen Energy Inc. received an offer from Stanhill Capital Partners to purchase the Company's K-Fuel process and technology business for $30 million. Among other things, the offer is expressly conditioned upon completion of due diligence, negotiation of definitive documents, the approval of Evergreen's stockholders and final approval of Stanhill's investment committee. The Company has formed a special committee consisting of Messrs. Richard B. Perl, Thomas H. Stoner, Chester N. Winter and Robert S. Kaplan to consider the Stanhill offer and other strategic alternatives. The members of the special committee are disinterested in the transaction. The special committee has retained Cooley LLP to serve as its independent legal counsel and is in the process of engaging a financial advisor to assist it in its process. Stanhill is a private merchant banking company based in London, Singapore and Hong Kong, with a focus on investments in the natural resources sector. Ilyas Khan, a member of the Company's Board of Directors and the Company's Executive Chairman and Acting Chief Executive Officer, is a substantial shareholder of Stanhill, and Peter Moss, also a member of the Company's Board of Directors has acted as an advisor to Stanhill Capital Partners in the past. Neither are members of the special committee formed to consider the offer from Stanhill. There can be no assurance that any agreement on terms satisfactory to the special committee will result from the Stanhill offer or that any transaction whatsoever will be completed. About Evergreen Energy Evergreen Energy Inc. has developed two, proprietary, patented, and green technologies: the GreenCert(TM) suite of software and services and K-Fuel(R). GreenCert, which is owned exclusively by Evergreen, is a science-based, scalable family of environmental intelligence solutions that quantify process efficiency and greenhouse gas emissions from energy, industrial and agricultural sources and may be used to create verifiable emission reduction credits. K-Fuel technology significantly improves the performance of low-rank coals, yielding higher efficiency and lowering emissions. The Company reported a net loss of $21.02 million on $403,000 of total operating revenue for the year ended Dec. 31, 2010, compared with a net loss of $58.53 million on $423,000 of total operating revenue during the prior year. Hein & Associates LLP, in Denver, Colo., expressed substantial doubt about Evergreen Energy's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and has had recurring cash used in operations. The Company's balance sheet at June 30, 2011, showed $24.54 million in total assets, $21.52 million in total liabilities, $2,000 in preferred stock, and $3.02 million in total stockholders' equity. EVERGREEN ENERGY: Ilyas Khan Discloses 6.6% Equity Stake -------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Ilyas Khan, ECK & Partners Holdings Limited, Crosby (Hong Kong) Limited, Stanhill Special Situations Fund, formerly Crosby Special Situations Fund, Stanhill Capital Partners Limited, formerly Crosby Capital Partners (BVI) Limited, disclosed that they beneficially own 1,858,250 shares of common stock of Evergreen Energy Inc. representing 6.60% of the shares outstanding. As previously reported by the TCR on Jan. 12, 2011, the reporting persons disclosed that they beneficially own 1,238,150 shares of common stock or 6.2% equity stake. A full-text copy of the amended Schedule 13D is available for free at http://is.gd/2opg97 About Evergreen Energy Evergreen Energy Inc. has developed two, proprietary, patented, and green technologies: the GreenCert(TM) suite of software and services and K-Fuel(R). GreenCert, which is owned exclusively by Evergreen, is a science-based, scalable family of environmental intelligence solutions that quantify process efficiency and greenhouse gas emissions from energy, industrial and agricultural sources and may be used to create verifiable emission reduction credits. K-Fuel technology significantly improves the performance of low-rank coals, yielding higher efficiency and lowering emissions. The Company reported a net loss of $21.02 million on $403,000 of total operating revenue for the year ended Dec. 31, 2010, compared with a net loss of $58.53 million on $423,000 of total operating revenue during the prior year. Hein & Associates LLP, in Denver, Colo., expressed substantial doubt about Evergreen Energy's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and has had recurring cash used in operations. The Company's balance sheet at June 30, 2011, showed $24.54 million in total assets, $21.52 million in total liabilities, $2,000 in preferred stock, and $3.02 million in total stockholders' equity. EVERGREEN SOLAR: Faces Delisting From Nasdaq Stock Market --------------------------------------------------------- Boston Business Journal reports that Evergreen Solar Inc. is one step closer to final delisting from the Nasdaq Stock Market after Nasdaq filed a delisting form with the U.S. Securities and Exchange Commission. According to the report, with Nasdaq filing what is called a Form 25 with the SEC on Oct. 5, the delisting will become final in 10 days. However, Evergreen's stock, which has been listed as ESLR, had already been suspended from trading on Aug. 24, nine days after Evergreen filed for bankruptcy protection. The report says Evergreen is one of two Boston-area energy technology to face a delisting threat. The Nasdaq has also moved against Beacon Power, which makes flywheel-based frequency regulation technology, even as the firm seeks financing for new plants. About Evergreen Solar Evergreen Solar, Inc. -- http://www.evergreensolar.com/-- develops, manufactures and markets String Ribbon solar power products using its proprietary, low-cost silicon wafer technology. The Company's patented wafer manufacturing technology uses significantly less polysilicon than conventional processes. Evergreen Solar's products provide reliable and environmentally clean electric power for residential and commercial applications globally. The Marlboro, Mass.-based Company filed for Chapter 11 bankruptcy (Bankr. D. Del. Case No. 11-12590) on Aug. 15, 2011, before Judge Mary F. Walrath. The Company's balance sheet at April 2, 2011, showed $373,972,000 in assets, $455,506,000 in total liabilities, and a stockholders' deficit of $81,534,000. Ronald J. Silverman, Esq., and Scott K. Seamon, Esq., at Bingham McCutchen LLP, serve as general bankruptcy counsel to the Debtor. Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as co-counsel. Zolfo Cooper LLC is the financial advisor. Epiq Bankruptcy Solutions has been tapped as claims agent. In conjunction with the Chapter 11 filing, the Company entered into a restructuring support agreement with certain holders of more than 70% of the outstanding principal amount of the Company's 13% convertible senior secured notes. As part of the bankruptcy process the Company will undertake a marketing process and will permit all parties to bid on its assets, as a whole or in groups pursuant to 11 U.S.C. Sec. 363. An entity formed by the supporting noteholders, ES Purchaser, LLC, entered into an asset purchase agreement with the Company to serve as a "stalking-horse" and provide a "credit-bid" pursuant to the Bankruptcy Code for assets being sold. The supporting noteholders are represented by Michael S. Stainer, Esq., and Natalie E. Levine, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York. FORD MOTOR: Moody's Reviews Ba2 Corp. Family Rating for Upgrade --------------------------------------------------------------- Moody's Investors Service is reviewing the ratings of Ford Motor Company (Ford) for possible upgrade following the announcement that the company has reached a tentative agreement with the United Auto Workers Union (UAW) on a four year contract replacing the agreement which expired on September 14. Ratings under review are the Corporate Family Rating (CFR) and Probability of Default Rating (PDR) at Ba2, secured bank debt at Baa3, and senior unsecured debt at Ba3. The company's Speculative Grade Liquidity rating is SGL-2. The proposed contract is being submitted to Ford's approximately 41,000 UAW employees for a ratification vote that Moody's expects will be completed shortly. Moody's is also reviewing the ratings of Ford Motor Credit Company (Ford Credit) and its supported entities for possible upgrade -- CFR at Ba2. Ford Credit's ratings are under review due to the finance operation's strategic importance to Ford and the formal support agreement from its parent. RATINGS RATIONALE Our initial assessment of the proposed UAW contract is that it should enable Ford to maintain its operating flexibility, fixed cost position, break even point, and liquidity position near current levels. If Moody's final review of the of the contract's provisions is consistent with this initial assessment, and if the contract is ratified, Ford's credit metrics and business position would be supportive of a higher rating. Beyond the terms and potential benefits of the new contract, Moody's review will also focus on the level of operating and financial flexibility that Ford will have in the face of increasing economic uncertainty in regional and global markets. Bruce Clark, Senior Vice President with Moody's said, "Ford has built a much stronger operating model and financial profile during the past year. Moody's wants to determine if it can maintain this position if markets conditions become more difficult." Our analysis will concentrate on several factors including: the break even level and earnings potential of Ford's North American operations under various stress scenarios; Ford's ability to maintain operating disciplines with respect to product quality, vehicle renewal rates, and the utilization of global platforms; and the company's long-term commitment to maintaining a strong balance sheet and liquidity profile. An additional consideration will be the potential drag represented by Ford Motor Credit Company whose stand-alone credit profile is likely to remain in the speculative grade area through the intermediate-term. Ford Credit's reliance on confidence-sensitive wholesale funding and high encumbered asset levels constrains its credit strength in relation to the credit improvements observed at Ford. Nevertheless, Ford Credit's rating could be upgraded in the event that Ford's rating is raised based on the support, both implicit and explicit, that is provided by Ford. Clark said, "In this review we are going to look at Ford and GM side-by-side, and we are likely to conclude Moody's reviews of the companies simultaneously." The last rating action on Ford was a change in the outlook to positive from stable on January 28, 2011. The principal methodology used in rating Ford was the Global Automotive Manufacturer Methodology 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. FRC LLC: Files for Chapter 11 Bankruptcy Protection --------------------------------------------------- Boston Business Journal reports that FRC LLC filed for protection under Chapter 11 of the U.S. bankruptcy code. The company listed under $1 million in assets and debts in the range of $1 million to $10 million. According to the report, a financial statement filed in connection with the bankruptcy filing reported a net loss of $739,920 for the first eight months of calendar 2011. The biggest unsecured creditors listed in the filing are: Morningstar Inc., owed $225,401; Thomson Reuters, owed $131,031; Bellemy Research, owed $123,800; and James Goodwin of Barrington, R.I., owed $105,105. Boston, Mass.-based FRC LLC provides investments data. FRIENDLY ICE CREAM: Obtains Approval of $50.6-Mil. Interim Loan --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Friendly Ice Cream Corp. on Oct. 6 received interim approval to borrow $50.6 million. At a final financing hearing Oct. 24, Friendly will request raising the borrowing limit to $71.3 million. In addition to closing 63 stores, Friendly arranged an Oct. 24 hearing for approval of auction procedures to sell the business. Absent better offers, an affiliate of the existing owner Sun Capital Partners Inc. will buy the operation in exchange for debt. Affiliates of Boca Raton, Florida-based Sun Capital are also holders of second-lien debt. 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. GARY PHILLIPS: Can Use Creditors' Cash Collateral Until Dec. 16 --------------------------------------------------------------- The Hon. Marcia Phillips Parsons of the U.S. Bankruptcy Court for the Eastern District of Tennessee authorized, in an amended interim order, Gary Phillips Construction, LLC, to access the cash collateral of its secured creditors until Dec. 16, 2011. The secured creditors consist of Bank of Tennessee, Citizens Bank, Commercial Bank, First Bank & Trust, Regions Bank, Tri-Summit Bank, TruPoint Bank, and Probuild Company, LLC. The Debtor would use the property in the nature of cash collateral to pay the estimated expenses that are necessary to prevent immediate and irreparable harm to the Debtor's estate. Any variance in expense figure in excess of the 10% will require approval by the Court. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the secured creditors replacement liens in and to all assets of the estate. The Debtor will also maintain insurance and General Commercial Liability Insurance in a form and amount acceptable to the banks and the U.S. Trustee. The Debtor related that Regions Bank only agreed to the order through the hearing date on their objection to the Debtor's use of cash collateral which is set for Oct. 26, 2011. A hearing on the Debtor's request for further cash collateral use will be held on Dec. 13, 2011, at 9:00 a.m. About Gary Phillips Construction Piney Flats, Tennessee-based Gary Phillips Construction, LLC, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Tenn. Case No. 10-53097) on Dec. 3, 2010. Fred M. Leonard, Esq. -- fredmleonard@earthlink.net -- in Bristol, Tennessee, serves as the Debtor's counsel. The Debtor tapped Wayne Turbyfield as accountant. The Court denied the application to employ Crye-Leike Realtors as realtor. In its schedules, the Debtor disclosed $13,255,698 in assets and $7,614,399 in liabilities as of the Petition Date. Daniel M. McDermott, the U.S. Trustee for Region 8, appointed six creditors to serve on an Official Committee of Unsecured Creditors in the Debtor's case. Dean B. Farmer, Esq., at Hodges, Doughty & Carson, PLLC, serves as the committee's counsel. GARY PHILLIPS: Wants TruPoint Bank DIP Loan Extended Until 2013 --------------------------------------------------------------- Gary Phillips Construction, LLC, and TruPoint Bank ask the U.S. Bankruptcy Court for the Eastern District of Tennessee for authorization to extend and modify an agreed order for the Debtor's postpetition loans. The Debtor owns a property consisting of approximately 11 lots in Cardinal Forest, Washington County, Tennessee. The Debtor financed the acquisition by a loan from the bank in the original principal amount of $380,000, secured by a deed of trust. As of the filing date, the outstanding balance of the acquisition loan was $278,666. Simultaneously with the acquisition loan, the Debtor obtained a construction loan from the bank in the original principal amount of $600,000, secured by a deed of trust. As of the filing date, the outstanding balance of the construction loan was $521,882. The parties request that the Debtor be authorized to obtain postpetition financing until Dec. 31, 2013. The parties related that the agreed order only provided that the bank would provide postpetition financing through the end of calendar year 2011. The Debtor related that it has completed construction of the house on Lot 3 and has entered into a lease/purchase agreement as to the same. In this regard, the Debtor has requested that Lot 3 be released from the collateral based securing the acquisition and construction loan. The terms of the postpetition financing will be identical to the terms in the prior motion, among other things: -- subject to the approval by the bank's loan committee, the Debtor will obtain a new and separate term loan in a principal amount ranging from $140,000 to $165,000 to be secured by a deed of trust as to lot 3 and an assignment of rents; -- standard credit terms will apply and the Debtor will be charged interest at the rate of 6%; -- the proceeds of the lot will be paid against the construction loan principal; -- the lot 3 term loan will be cross-collaterized against the bank's collateral under the acquisition loan; -- as before, the Debtor and the Official Committee of Unsecured Creditors will have 90 days within which to file an objection as to the claim of the bank based on the perfection, extent, validity, or priority of the same. As reported in the Troubled Company Reporter on June 23, 2011, the bank will have superpriority as to all postpetition advances made to the Debtor on the collateral of the bank in Cardinal Forrest Subdivision. The Debtor set an Oct. 18 hearing on its request to access DIP financing. About Gary Phillips Construction Piney Flats, Tennessee-based Gary Phillips Construction, LLC, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Tenn. Case No. 10-53097) on Dec. 3, 2010. Fred M. Leonard, Esq. -- fredmleonard@earthlink.net -- in Bristol, Tennessee, serves as the Debtor's counsel. The Debtor tapped Wayne Turbyfield as accountant. The Court denied the application to employ Crye-Leike Realtors as realtor. In its schedules, the Debtor disclosed $13,255,698 in assets and $7,614,399 in liabilities as of the Petition Date. Daniel M. McDermott, the U.S. Trustee for Region 8, appointed six creditors to serve on an Official Committee of Unsecured Creditors in the Debtor's case. Dean B. Farmer, Esq., at Hodges, Doughty & Carson, PLLC, serves as the committee's counsel. GLOBAL CROSSING: STT Crossing's Equity Stake Down to 0% ------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Temasek Holdings (Private) Limited, Singapore Technologies Telemedia Pte Ltd, STT Communications Ltd, and STT Crossing Ltd, disclosed that they do not beneficially own any shares of common stock of Global Crossing Limited. As previously reported by the TCR on April 18, 2011, STT Crossing and its affiliates disclosed beneficial ownership of 47,351,431 shares or 60.2% equity stake. A full-text copy of the latest Schedule 13D is available for free at http://is.gd/GNCkMA 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. GREENWICH SENTRY: Judge Approves Chapter 11 Plans ------------------------------------------------- Ian Thoms at at Bankruptcy Law360 reports that a New York bankruptcy judge on Tuesday approved the disclosure statements explaining the restructuring plans of two Fairfield Greenwich Group affiliates that acted as feeder funds for Bernard L. Madoff's massive Ponzi scheme. Law360 relates that the move allows Greenwich Sentry LP and Greenwich Sentry Partners LP to submit their plans, which they say enjoy broad support, to creditors for approval. Creditors must send their votes on the plans by Nov. 4, 2011, and the bankruptcy court will holding a confirmation hearing on Nov. 22, 2011. As reported in the Aug. 20, 2011 edition of the TCR, according to the Disclosure Statements, the Plans have substantially similar operative terms, with the exception of certain monetary amounts and other numbers involved that are specific to each Debtor. The primary components of both Debtors' plan are: -- the payment in full of allowed administrative expense claims, allowed professional fee claims, allowed priority tax claims, allowed priority claims and allowed general unsecured claims; -- the implementation of a settlement with the BLMIS trustee for the estate of Bernard L. Madoff Investment Securities; and -- the establishment of two trusts to hold the retained assets left in the Debtor's estate after consummation of the BLMIS trustee settlement and payment of allowed claims with priority over the allowed limited partner interests of certificates representing the beneficial ownership of the trusts. The central feature of Greenwich Sentry Partners, L.P.'s Plan is the BLMIS trustee settlement, wherein the Debtor believing, pursuant to its good faith business judgment, that avoidance action claims of the BLMIS trustee would be difficult to defend, has agreed, in sum, to allow the BLMIS trustee a claim and judgment in the amount of $5,985,000 and the BLMIS trustee has agreed to seek recovery of his claim only from certain specified assets of the Debtor, to allow the Debtor's customer claim against BLMIS in the amount of $2,011,304, to share recovery on certain litigation claims with the Debtor, and to provide for the distribution of the retained assets to creditors and limited partners free and clear of the BLMIS trustee claims. The central feature of Greenwich Sentry, L.P.'s Plan is the BLMIS trustee settlement, wherein the Debtor, believing, pursuant to its good faith business judgment, that avoidance action claims of the BLMIS trustee would be difficult to defend, has agreed, in sum, to allow the BLMIS trustee a claim and judgment in the amount of $206 million, and the BLMIS trustee has agreed to seek recovery of his claim only from certain specified assets of the Debtor, to allow the Debtor's customer claim against BLMIS in the amount of $35 million, to share recovery on certain litigation claims with the Debtor, and to provide for the distribution of the retained assets to creditors and limited partners free and cler of the BLMIS' trustee's claims. The BLMIS trustee agreed to support the Plans and Disclosure Statement and to vote his claim in favor of the Plans pursuant to the settlement agreements. BLMIS is a broker-dealer registered with the Securities and Exchange Commission, though customer accounts maintained by the Debtors at BLMIS. The Debtors have been informed that holder of not less than $60 million in limited partner interests in GS also favor the Court's approval of the Disclosure Statements and confirmation of the Plans. The Plans provide the Debtors' creditors with substantial recoveries and allows for recovery of equity. The Debtors propose a Sept. 1 hearing on the approval of their Disclosure Statements. Objections, if any, are due Aug. 25. Full-text copies of the Disclosure Statements are available for free at: http://bankrupt.com/misc/GREENWICHSENTRY_DS.pdf http://bankrupt.com/misc/GREENWICHSENTRYPartners_DS.pdf About Greenwich Sentry Liquidators of Fairfield Sentry Limited, filed a Chapter 15 petition for Fairfield in June 2010 (Bankr. S.D.N.Y. Case No. 10-13164). In July 2010, Kenneth Krys and Christopher Stride of Krys & Associates (BVI) Limited, the liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited obtained cross-border recognition as foreign main proceedings by the U.S. Bankruptcy Court of the funds' insolvency proceedings, pending in the British Virgin Islands. The liquidators are represented in the U.S. by Brown Rudnick LLP. Fairfield Sentry Limited was the largest "feeder fund" to Bernard L. Madoff Investment Securities LLC, and invested approximately 95% of its assets with BLMIS. BLMIS was placed into liquidation proceedings in the United States in December 2008, after it was revealed that Bernard Madoff operated BLMIS as a Ponzi scheme for many years. Fairfield Sigma Limited and Fairfield Lambda Limited were both feeder funds of Fairfield Sentry Limited, and invested all of their assets with Fairfield Sentry Limited. Greenwich Sentry, L.P., and an affiliate filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-16229) on Nov. 19, 2010, hoping to settle lawsuits filed against it in connection with its investments with Bernard L. Madoff. Paul R. DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP, in New York, represents the Debtors in the Chapter 11 cases. Bernard L. Madoff was charged by the Securities and Exchange Commission in December 2008 of orchestrating the largest Ponzi scheme in history, with losses topping US$50 billion. In March 2009, Mr. Madoff pleaded guilty to 11 federal crimes and admitted to turning his wealth management business into a Ponzi scheme. A trustee was appointed to liquidate and has been filing clawback suits against investors who withdrew phony profits from Mr. Madoff. On May 18, 2009, Irving H. Picard, the trustee liquidating the estate of Mr. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC, filed a lawsuit against Fairfield Sentry and Greenwich, seeking the return of $3.55 billion that Fairfield withdrew from Madoff during the period from 2002 to Madoff's arrest in December 2008. Since 1995, the Fairfield funds invested about $4.5 billion with BLMIS. Mr. Picard claims that Fairfield knew or should have known about the fraud give that it received from BLMIS unrealistically high and consistent annual returns of between 10% and 21% in contrast to the vastly larger fluctuations in the S&P 100 Index. In schedules filed with the Court, Greenwich Sentry disclosed $317,073,770 in total assets and $206,337,244 in total liabilities. GREENWOOD RACING: Moody's Confirms 'B2' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service has confirmed the B2 Corporate Family Rating of Greenwood Racing, Inc. ("Greenwood") and the B1 ratings for its senior secured term loan due 2011. Moody's has confirmed the following ratings: Corporate Family Rating -- B2 Probability of Default Rating -- B2 $265 million senior secured term loan due 2011 -- B1 (LGD3, 40%) Rating outlook: stable RATINGS RATIONALE The rating confirmation reflects Greenwood's continued solid operating performance and strong credit metrics and follows completion of the refinancing and full repayment of the $265 million term loan which would have matured on November 28, 2011. The action concludes the review of Greenwood's ratings which was initiated on July 18, 2011 due to refinancing risk. Moody's will withdraw Greenwood's ratings subsequent to the rating actions. The principal methodology used in rating Greenwood Racing, Inc. 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. Greenwood Racing, Inc. owns and operates the Parx Casino ("Parx") slots gaming facility in Bensalem, Pennsylvania, a 20-minute drive from downtown Philadelphia. The company opened its permanent facility in December 2009 and currently features approximately 3,461 slot machines and 152 table games including Poker. The company also conducts live racing for thoroughbred horses at the Philadelphia Park facility located adjacent to Parx. GUIDED THERAPEUTICS: LuViva Under Review by UK's NHS Diagnostics ---------------------------------------------------------------- Guided Therapeutics, Inc., announced that the LuViva Advanced Cervical Scan was selected for inclusion in a review of new technologies by the United Kingdom's National Institute for Health and Clinical Excellence. As part of NICE's work to provide guidance on medical technologies, its Diagnostics Assessment Programme focuses on the evaluation of innovative medical diagnostic technologies in order to ensure that the National Health Service is able to adopt clinically and cost effective technologies rapidly and consistently. LuViva is one of four new adjunctive colposcopy technologies under review as part of the assessment. Additional information about the NICE assessment can be found at: http://guidance.nice.org.uk/DT/5 "Inclusion in the NICE review is important to our strategy of establishing LuViva as a means to improve the standard of care for women's health internationally," said Mark L. Faupel, Ph.D., President and CEO of Guided Therapeutics. "We look forward to working with NICE over the coming months to demonstrate not only LuViva's efficacy, but the tremendous savings in time and money our technology can bring to the UK healthcare system." LuViva scans the cervix with light to identify cancer and pre- cancer painlessly and non-invasively. Guided Therapeutics' patented biophotonic technology is able to distinguish between normal and diseased tissue by detecting biochemical and morphological changes at the cellular level. Unlike Pap or HPV tests, LuViva does not require laboratory analysis or a tissue sample, and is designed to provide results immediately, which eliminates costly, painful and unnecessary testing. In the United Kingdom, LuViva is proposed initially as a test for about 400,000 women who are annually referred to more than 170 institutions for follow up from a Pap test, called a colposcopy examination, which in many cases involves taking a biopsy of the cervix. Based on its clinical trial results, LuViva could eliminate about 40% of unnecessary follow up procedures and could identify serious cervical disease up to two years earlier than the standard of care. About Guided Therapeutics Guided Therapeutics, Inc. (OTC BB and OTC QB: GTHP) -- http://www.guidedinc.com/-- is developing a rapid and painless test for the early detection of disease that leads to cervical cancer. The technology is designed to provide an objective result at the point of care, thereby improving the management of cervical disease. Unlike Pap and HPV tests, the device does not require a painful tissue sample and results are known immediately. GT has also entered into a partnership with Konica Minolta Opto to develop a non-invasive test for Barrett's Esophagus using the LightTouch technology platform. The Company's balance sheet at June 30, 2011, showed $3.31 million in total assets, $2.91 million in total liabilities, and $410,000 in stockholders' equity. The Company reported a net loss of $2.84 million on $3.36 million of contract and grant revenue for the year ended Dec. 31, 2010, compared with a net loss of $6.21 million on $1.55 million of contract and grant revenue during the prior year. As reported by the TCR on April 4, 2011, UHY LLP, in Atlanta, Georgia, noted that the Company's recurring losses from operations, accumulated deficit and lack of working capital raise substantial doubt about its ability to continue as a going concern. HALO COMPANIES: Tony Chron Resigns as President ----------------------------------------------- Tony Chron resigned from his role as President of Halo Companies, Inc., in order to pursue an opportunity in the real estate development field where he spent 25 years of his career prior to becoming President of the Company. Mr. Chron will remain on the Board of Directors of the Company. On Sept. 30, 2011, Reif Chron, 33, has been appointed to serve as President and General Counsel of the Company. Mr. Chron is Brandon Thompson's cousin. Mr. Chron joined Halo in March of 2009 to serve as General Counsel. Mr. Chron studied Accounting at Texas A&M University and subsequently graduated with his Juris Doctorate from Washington University School of Law. Prior to attending Washington University, Mr. Chron spent time at Pricewaterhouse Coopers LLP where specialized tax planning for high net worth clients, as well as Trademark Property Company where he participated in several projects including a 160 million dollar real estate portfolio sale to Heritage Property Investment Trust, a new 400,000 square foot shopping center in Flowood, MS and a 100 million dollar lifestyle center located in the Woodlands, TX. Mr. Chron also compiled market research that has led to three new development projects. After earning his law degree, he practiced as a real estate attorney at Kelly Hart & Hallman where his experience includes the negotiation, due diligence review, documentation, and closing of sophisticated real estate transactions, including the acquisition and disposition of office buildings, hotels, commercial tracts and ranch land as well as representing developers in the acquisition, leasing and management of shopping centers and mixed-use projects. On Sept. 30, 2011, Robert A. Boyce, Jr., 49, has been appointed to serve as Chief Operating Officer of the Company. Mr. Boyce joined Halo in June of 2011 bringing over 27 years of business operating experience in public companies and the private sector. For the five years prior to joining Halo, Mr. Boyce managed and operated commercial real estate holdings in Texas and commercial agricultural properties in Mississippi. From 1990 to 2005, Mr. Boyce held various executive positions for United Agri Products (and its related entities), which prior to being taken public by the Apollo Group, was a wholly-owned subsidiary of ConAgra Foods. While with UAP, Mr. Boyce held the positions of President of Verdicon, the non-crop distribution business with revenues of $300 million; Executive Vice President of United Agri Products responsible for $1.2 billion in revenue; and President and General Manager for two independent operating companies with revenue of $200 million. Prior to joining UAP, Mr. Boyce worked for Helena Chemical Company and ICI Americas. Throughout his career, Mr. Boyce has served on national and regional industry-related boards. He is a graduate from the University of Mississippi, B.B.A., 1984. About Halo Companies Allen, Texas-based Halo Companies, Inc., is a nationwide real estate investment, asset management and financial services company that provides technology and asset management solutions to asset owners as well as real estate and financial services to financially distressed consumers which can be applied individually or utilized as a comprehensive workout strategy. As reported by the TCR on April 8, 2011, Montgomery Coscia Greilich LLP, in Plano, Texas, expressed substantial doubt about Halo Companies' ability to continue as a going concern. The independent auditors noted that the Company has incurred losses since its inception and has not yet established profitable operations. The Company reported a net loss of $3.6 million on $6.9 million of revenue for 2010, compared with a net loss of $1.9 million on $9.1 million of revenue for 2009. The Company's balance sheet at June 30, 2011, showed $1.56 million in total assets, $4.12 million in total liabilities and a $2.55 million total shareholders' deficit. HENDEE ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Hendee Enterprises, Inc. 9350 South Point Dr. Houston, TX 77054-3724 Bankruptcy Case No.: 11-38444 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Jeff Bohm Debtor's Counsel: J. Craig Cowgill, Esq. J. CRAIG COWGILL & ASSOCIATES, P.C. 8100 Washington, Suite 120 Houston, TX 77007 Tel: (713) 956-0254 Fax: (713) 956-6284 E-mail: jccowgill@cowgillholmes.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/txsb11-38444.pdf The petition was signed by Robert Veasey III, president. HIGHLANDS GROUP: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Debtor: The Highlands Group of Brunswick, LLC P.O. Box 1083 Wilmington, NC 28402 Bankruptcy Case No.: 11-07628 Chapter 11 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court Eastern District of North Carolina (Wilson) Debtor's Counsel: George M. Oliver, Esq. OLIVER FRIESEN CHEEK, PLLC P.O. Box 1548 New Bern, NC 28563 Tel: (252) 633-1930 Fax: (252) 633-1950 E-mail: efile@ofc-law.com Scheduled Assets: $2,489,187 Scheduled Debts: $3,485,025 The petition was signed by Harry Stovall, member/manager. The Company?s list of unsecured creditors filed with the petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Regions Bank -- $75,000 Attn: Officer, Mg Agt, Agent 1105 Military Cutoof Road Wilmington, NC 28403 LAND DEVELOPMENT: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Land Development Technology of NJ, LLC 201 Wilton Avenue Middlesex, NJ 08846 Bankruptcy Case No.: 11-39140 Chapter 11 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court District of New Jersey (Trenton) Judge: Raymond T. Lyons, Jr. Debtor's Counsel: Randi K. Franco, Esq. FRANCO & FRANCO 55 Madison Avenue, Suite 400 Morristown, NJ 07960 Tel: (973) 993-1843 Fax: (973) 285-3223 E-mail: ranfranc@optonline.net Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 The Company?s list of its unsecured creditors filed together with the petition does not contain any entry. The petition was signed by Christine Porchetta, chief financial officer. HOLDINGS OF EVANS: Amends List of Largest Unsecured Creditors ------------------------------------------------------------- Holdings of Evans LLC has filed with the U.S. Bankruptcy Court for the Southern District of Georgia an amended list of its largest unsecured creditors. The Debtor took out Lovett Law Firm and Neil L. Wilcove from the list and added ABR Fire Protection, Inc., Advanced Enviromental Resource Tech, and T.M.N. & Associates, Inc. Debtor's Amended List of Its 10 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ ABR Fire Protection, Inc. c/o Kevin Duncan Herrick 2478 Sandell Drive Atlanta, GA 30338 $11,482.00 Advanced Enviromental Resource Tech P.O. Box 100 Bogart, GA 30622 $30,000.00 Brian Leonard P.O. Box 321 Augusta, GA 30914 Services Rendered $2,000.00 Claussen Loan Personal Loan to Holdings of Evans to pay legal fees and operating expenses` $396,773.07 G.B. Sharma Personal Loan to Holdings of Evans to pay legal fees and other operating expenses $270,000.00 M. R. Sridharan Personal Loan to Holdings of Evans to pay legal fees and other operating costs $191,000.00 Mr. Shawn Fitzpatrick Bratton Mahaffey, Pickens, Tucker LLP Consulting Services $1,208.84 South East Hospitality Purchase of Recliners, Chairs, Drapery and Carpets - Clients Dispute balance. Items do not meet IHG Brand Standard and merchandise was received late $122,000.00 T.M.N. & Associates, Inc. Vista Bank Construction Loan in the original amount of $750,000.00 $460,000.00 About Holdings of Evans Martinez, Georgia-based Holdings of Evans LLC, dba Candlewood Suites, filed for Chapter 11 bankruptcy (Bankr. S.D. Ga. Case No. 11-11756) on Sept. 2, 2011. Judge Samuel L. Kay presides over the case. Todd Boudreaux, Esq., at Shepard Plunkett Hamilton Boudreaux, serves as the Debtor's counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by GB Sharma, managing member. HOLDINGS OF EVANS: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Holdings of Evans LLC, dba Candlewood Suites, filed with the Bankruptcy Court for the Southern District of Georgia its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $7,700,000 B. Personal Property $3,415,538 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $5,300,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $1,484,463 ----------- ----------- TOTAL $11,115,538 $6,784,463 About Holdings of Evans Martinez, Georgia-based Holdings of Evans LLC, dba Candlewood Suites, filed for Chapter 11 bankruptcy (Bankr. S.D. Ga. Case No. 11-11756) on Sept. 2, 2011. Judge Samuel L. Kay presides over the case. Shepard Plunkett Hamilton Boudreaux LLC serves as the Debtor's Chapter 11 counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by GB Sharma, managing member. HOLDINGS OF EVANS: U.S. Trustee Unable to Form Committee -------------------------------------------------------- The United States Trustee said that an official committee under 11 U.S.C. Sec. 1102 has not been appointed in the bankruptcy case of Holdings of Evans LLC, dba Candlewood Suites, because an insufficient number of persons holding unsecured claims against the Debtor have expressed interest in serving on a committee. The U.S. Trustee reserves the right to appoint such a committee should interest developed among the creditors. About Holdings of Evans Martinez, Georgia-based Holdings of Evans LLC, dba Candlewood Suites, filed for Chapter 11 bankruptcy (Bankr. S.D. Ga. Case No. 11-11756) on Sept. 2, 2011. Judge Samuel L. Kay presides over the case. Shepard Plunkett Hamilton Boudreaux LLC serves as the Debtor's Chapter 11 counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by GB Sharma, managing member. HOVENSA LLC: S&P Keeps 'B' Secured Debt Rating; Outlook Negative ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its recovery rating on Virgin Islands-based Hovensa LLC's $400 million first-lien revolving credit facility due in 2011-2012 and its $355.7 million in tax-exempt debt issued by the U.S. Virgin Islands and the Virgin Islands Public Finance Authority to '2' from '1'. The project rating remains 'B' and the outlook remains negative. The '2' recovery rating indicates that lenders can expect a substantial (70%-90%) recovery if a payment default occurs. "The revised recovery score reflects the high cost structure and level of mandatory capital spending required at the facility, which is likely to impair lender recovery value in the event of default compared to our previous analysis. We have lowered our rating despite the fact that the revolving credit facility will mature in 2011 and 2012, leaving the project with less debt outstanding in 2013, the time of default in our simulation," S&P said. "The current rating on Hovensa reflects its weak financial profile, which we expect will continue to be pressured by low margins and negative project cash flows through at least 2013. Our expectation assumes a weak refining environment for facilities processing Brent-priced crude, high fuel and operating expenses, and high capital spending requirements," S&P stated. With negative cash flow and internal liquidity short of requirements, Hovensa's stand-alone profile is consistent with a low 'B' or high 'CCC' category rating. However, Hovensa's project rating reflects an expectation of support from its parents, Hess Corp. and Petr�leos de Venezuela S.A. (PDVSA), over the short term due to its moderately strategic importance. Refining margins are highly volatile, and the project could return to profitability if demand for refined products increases and margins improve. "However, our economists currently project a slow economic recovery, with U.S. GDP growth of about 2% through 2013, and we believe Brent-based refining margins are likely to remain weak. In addition, a minority portion of Hovensa's credit facility matures in December 2011, with the balance maturing a year later. With high environmental capital spending requirements that we expect to escalate in 2013, Hovensa may need Hess and PDVSA to provide significant additional funding. If the parents remain convinced that Hovensa's current issues are a matter of short-term liquidity rather than a long-term solvency, we believe their support may continue. If the parents believe otherwise, we feel they may withdraw support because in our view the facility is not a core asset to either parent," S&P related. Hovensa had a cash balance of $32 million as of June 30, 2011. It also maintains a six-month debt service reserve of $11 million and benefits from a $400 million working-capital facility and $30 million in sponsor support. "In our opinion, poor market conditions combined with high fuel and operating costs and ongoing capital spending result in less-than-adequate liquidity and are likely to require Hovensa's parents to provide financial support to the project through at least 2013. Its cash position has decreased significantly in the past two years and the project has made no distributions since second-quarter 2008. Higher-than- expected capital spending, a worsening or continuation of poor refining conditions, and a cessation or decline in parent support could materially constrain the project's ability to meet short- term cash needs," S&P stated. "The negative outlook reflects our expectation of negative project cash flow through 2013 due to a weak refining environment and the facility's cost structure, as well as Hovensa's reduced liquidity as cash balances have fallen, the revolver matures, and the need for parent support increases. We anticipate that poor market conditions combined with high levels of required capital spending will keep the project's debt service coverage below zero through 2013. Our rating on Hovensa is supported by our assumption that the project's parents are likely to assist it with liquidity over the short term. If parent support is scaled back or withdrawn, or turns out to be inadequate due to worse-than-expected refining margins, we could lower the rating. If Hovensa can weather the current downturn and rebuild its liquidity position to pre-2008 levels, we could revise the negative outlook to stable or raise the rating," S&P added. Ratings List Recovery Rating Lowered To From Hovensa LLC Senior secured debt B/Negative Recovery rating 2 1 HOVNANIAN ENTERPRISES: Fitch Puts 'CCC' IDR on Watch Negative ------------------------------------------------------------- Fitch Ratings has placed Hovnanian Enterprises, Inc. (NYSE: HOV, 'CCC' IDR) on Rating Watch Negative following the announcement of a planned $220 million debt exchange offer. Fitch views the proposed exchange offer to be a distressed debt exchange; the placement of Hovnanian's ratings on Rating Watch Negative reflects Fitch's 'Distressed Debt Exchange Criteria', published Aug. 12, 2011. Distressed Debt Exchange: On Sept. 28, 2011, Hovnanian announced the commencement of private offers to exchange certain of its senior unsecured notes for up to $220 million of new 2% senior secured notes due 2021. The new notes will be secured by a first- priority lien on the assets of certain subsidiaries that are 'unrestricted subsidiaries' under the company's existing indentures. The assets of these subsidiaries are not collateral for the company's existing secured indebtedness. Fitch believes that the exchange offer represents a material reduction in terms vis-a-vis the terms of the notes being offered for exchange. In particular, there is a significant reduction in interest rate and a lengthy extension of maturity date. Furthermore, the exchange offer is being initiated as part of an ongoing restructuring of the company's capital structure to increase financial flexibility. Fitch will address the Rating Watch Negative following the closing of the exchange offer. The rating for HOV is influenced by the company's execution of its business model, land policies and geographic, price point and product line diversity. The rating additionally reflects the company's liquidity position, substantial debt and high leverage. It also incorporates the still challenging housing environment. With the recent softening in the economy and lowered economic growth expectations for 2011 and 2012, the environment may at best support a relatively modest recovery in housing metrics over the next year and a half. Fitch has placed the following ratings on Rating Watch Negative: -- Issuer Default Rating (IDR) 'CCC'; -- Senior secured notes 'B-/RR3'; -- Senior unsecured notes 'C/RR6'; -- Series A perpetual preferred stock 'C/RR6'. HOVNANIAN ENTERPRISES: S&P Lowers Corp. Credit Rating to 'CC' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Hovnanian Enterprises Inc. to 'CC' from 'CCC'. "We also lowered our ratings on the company's rated senior debt. We downgraded the first-lien senior secured notes to 'CC' from 'CCC' and downgraded the senior unsecured notes to 'C' from 'CC'. The '3' recovery rating on the first-lien notes and the '6' recovery rating on the senior unsecured and senior subordinated notes are unchanged. We also affirmed our 'C' rating on the company's preferred securities. The rating actions affect $1.6 billion of rated debt securities," S&P stated. "The downgrade follows Hovnanian's announcement that its K. Hovnanian subsidiary has commenced an offer to exchange certain existing senior notes with coupons ranging from 6.25% to 11.875% scheduled to mature between 2014 through 2017 for new 2% secured notes to mature in 2021," said credit analyst George Skoufis." "According to our criteria, we view this as a 'distressed Exchange' and tantamount to a default." The outlook is negative. "If K. Hovnanian completes the proposed exchange offer, we will lower our corporate credit ratings on Hovnanian and K. Hovnanian to 'SD' and downgrade the existing exchanged notes to 'D'. After the debt exchange we would revise our corporate credit ratings after the debt exchange based on the company's capital structure and liquidity profile while also taking into consideration its operating performance and expectations in the currently challenging housing environment," S&P related. HUDSON HEALTHCARE: Hoboken Univ Creditors Strike Sale Settlement ---------------------------------------------------------------- Dow Jones' DBR Small Cap reports that creditors of the Hoboken University Medical Center accepted a $10.2 million settlement offer, Hoboken, N.J., city officials said, paving the way for the sale of the cash-strapped hospital to a for-profit medical group to proceed. As reported in the Oct. 6, 2011 edition of the TCR, the Official Committee of Unsecured Creditors in the Hudson Healthcare, Inc. bankruptcy voted to approve the sale of Hoboken University Medical Center to HUMC Holdco, LLC and to approve a global settlement by and among the City of Hoboken, the Hoboken Municipal Hospital Authority ("HMHA"), HUMC, and the Committee. This decision, which will save New Jersey's oldest operating hospital, comes after months of HUMC Holdco working closely with the HMHA, the Department of Health and Senior Services, and the NJ State Health Planning Board, which formally recommended approval of the Certificate of Need for the transfer of ownership. About Hudson Healthcare Hudson Healthcare Inc. is the nonprofit operator of Hoboken University Medical Center in Hoboken, New Jersey. Hudson Healthcare filed for Chapter 11 protection (Bankr. D. N.J. Case No. 11-33014) in Newark on Aug. 1, 2011, estimating assets and debt of less than $50 million. Affiliate Hoboken Municipal Hospital Authority also sought Chapter 11 protection. Attorneys at Trenk, Dipasquale, Webster, et al., serve as counsel to the Debtor. Daniel McMurray, the patient care ombudsman, has tapped Neubert, Pepe & Monteith P.C. as his counsel effective Aug. 25, 2011. The Official Committee of Unsecured Creditors of Hudson Healthcare has retained Sills Cummis & Gross P.C. as its counsel, nunc pro tunc to Aug. 12, 2011. INNER CITY: Senior Lenders Object to Rothschild's Success Fee ------------------------------------------------------------- Senior lenders of Inner City Media Corporation, et al., ask the U.S. Bankruptcy Court Southern District of New York to deny the Debtors' motion to employ Rothschild Inc., solely as it relates to payment of any success fee to Rothschild. The senior lenders are Yucaipa Corporate Initiatives Fund II, L.P., Yucaipa Corporate Initiatives (Parallel) Fund II, L.P., CF ICBC LLC, Fortress Credit Funding I L.P., and Drawbridge Special Opportunities Fund Ltd. Cortland Capital Market Services LLC, serves as administrative agent for the lenders signatory to the Credit Agreement. During the informal status conference before the Court on Aug. 31, 2011, the senior lenders advised the Court that Alvarez & Marsal had been retained during the prepetition period as financial advisor to the Debtors. Pursuant to A&M's engagement letter, the Debtors committed to pay A&M, among other things, a success fee of $1,500,000 upon the earlier to occur of (a) the consummation of any out-of-court Restructuring Transaction and (b) the effective date of a confirmed chapter 11 plan, which constitutes a Restructuring Transaction. The senior lenders made clear to the Court during the Aug. 31 status conference, that the Debtors' estates must not be responsible for the payment of two success fees to financial advisors that were retained by the Debtors. The senior lenders have insisted that there be an overall cap with respect to the payment of success fees to A&M and Rothschild, either as a prepetition claim or a postpetition expense. The senior lenders were under the impression that the success fee issue would be resolved in connection with plan negotiations. The senior lenders intend to continue to negotiate to resolve all open issues regarding the plan. At present there has been no resolution of the particular issue among the Debtors, Rothschild, and the senior lenders. Yucaipa Corporate Initiatives Fund II, L.P. and Yucaipa Corporate Initiatives (Parallel) Fund II, L.P. are represented by: CADWALADER, WICKERSHAM & TAFT LLP John J. Rapisardi, Esq. Scott J. Greenberg, Esq. One World Financial Center New York, New York 10281 Tel: (212) 504-6000 Fax: (212) 504-6666 E-mail: john.rapisardi@cwt.com scott.greenberg@cwt.com - and - CADWALADER, WICKERSHAM & TAFT LLP Peter Friedman, Esq. 700 Sixth Street, N.W. Washington, D.C. 20001 Tel: (202) 862-2200 Fax: (202) 862-2400 CF ICBC LLC, Fortress Credit Funding I L.P., and Drawbridge Special Opportunities Fund Ltd. are represented by: SCHULTE ROTH & ZABEL LLP Adam C. Harris, Esq. Meghan Breen, Esq. 919 Third Avenue New York, NY 10022 Tel: (212) 756-2000 Fax: (212) 593-5955 E-mail: adam.harris@srz.com meghan.breen@srz.com About Inner City Media Corp. On Aug. 23, 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 Media Corp. 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 Feb. 13, 2010. Inner City Media'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. Attorneys for Yucaipa Corporate Initiatives Fund II, L.P. and Yucaipa Corporate Initiatives (Parallel) Fund II, L.P. are John J. Rapisardi, Esq., and Scott J. Greenberg, Esq., at Cadwalader, Wickersham & Taft LLP. Attorneys for CF ICBC LLC, Fortress Credit Funding I L.P., and Drawbridge Special Opportunities Fund Ltd. are Adam C. Harris, Esq., and Meghan Breen, Esq., at Schulte Roth & Zabel LLP. Akin Gump Strauss Hauer & Feld LLP serves as the Debtors' counsel. Rothschild Inc. serves as the Debtors' financial advisors and investment bankers. GCG Inc. serves as the Debtors' claims agent. INNKEEPERS USA: Creditors to Join Trial Over $1.12BB Hotel Deal --------------------------------------------------------------- Sindhu Sundar at Bankruptcy Law360 reports that a bankruptcy judge ruled Wednesday that creditors of Innkeepers USA Trust could participate in an upcoming trial over whether a Cerberus Capital Management LP unit and Chatham Lodging Trust improperly reneged on their deal to buy 64 hotels for $1.12 billion. U.S. Bankruptcy Judge Shelley Chapman approved an agreement between Cerberus, Chatham, Innkeepers and its committee of unsecured creditors, allowing the committee to have a limited role in the trial, which is set to begin Oct. 10 in New York bankruptcy court. As reported in the Troubled Company Reporter on Oct. 5, 2011, Bill Rochelle, the bankruptcy columnist for Bloomberg News, said Cerberus Capital Management LP and Chatham Lodging Trust filed their pre-trial brief Oct. 4 laying out the theory they will use at trial where Innkeepers USA Trust will ask the bankruptcy judge to compel Cerberus and Chatham to complete the $1.12 billion acquisition of 64 hotels. The trial begins Oct. 10 in U.S. Bankruptcy Court in Manhattan. According to Bloomberg, the erstwhile buyers contend they were entitled to cancel the contract under a material adverse change clause in the contract. They point to deteriorating conditions in the country's economy and the lodging industry in particular as the basis for ending the purchase obligation. Cerberus and Chatham, according to Bloomberg, cited the 30% to 40% decline in the price of hotel stocks, the tightening of capital markets, and analysts' downgrades of the lodging industry as permissible grounds for termination. Even if they violated the contract, the two buyers say Innkeepers' only remedy is to keep the $20 million contract deposit. The lawsuit against Cerberus is Innkeepers USA Trust v. Cerberus Four Holdings LLC (In re Innkeepers USA Trust), 11-02557, U.S. Bankr. S.D.N.Y. (Manhattan). Cerberus Sale Collapses In June 2011, the Bankruptcy Court confirmed Innkeepers' chapter 11 plan of reorganization. The Plan is premised on the sale of the Company's hotel portfolio. A joint venture between the private-equity firm Cerberus Capital Management, L.P. and the real estate investment trust Chatham Lodging agreed to purchase for roughly $1.12 billion the equity in entities that own and operate 65 of the Company's hotels. Cerberus and Chatham agreed to pay $400.5 million cash and assume about $723.8 million mortgage debt for the hotels. Chatham Lodging also agreed to purchase for $195 million, five of the Company's hotels that serve as collateral for loan trusts serviced by LNR Partners LLC. The deal for the five hotels closed in July 2011. Cerberus and Chatham on Aug. 19 terminated a deal to acquire a portfolio of Innkeepers USA Trust's hotels. In a statement, Cerberus and Chatham said they had abandoned the deal "as a result of the occurrence of a condition, change or development that could reasonably be expected to have a material adverse effect" on Innkeepers' business, operations or financial condition, among other things. The deal had a Sept. 15, 2011 deadline to close. Cerberus and Chatham are required to pay a $20 million termination fee under the bankruptcy court-approved asset purchase agreement. Innkeepers insists that no changes have occurred to the hotel owner's business that would trigger the "material adverse effect" clause in the buyout's contract. The Debtors have filed a complaint against Cerberus, Chatham Lodging Trust and other related defendants for breach of contract and other claims for reneging on their commitment to acquire 64 hotels from Innkeepers. The lawsuit is Innkeepers USA Trust v. Cerberus Four Holdings LLC (In re Innkeepers USA Trust), 11-02557, U.S. Bankruptcy Court, Southern District New York (Manhattan). The two sides and Judge Shelley C. Chapman agreed that a trial of the lawsuit could start on Oct. 10, which would necessitate the opening of the courthouse during the Columbus Day holiday. Innkeepers USA has won an extension until Nov. 10 of its exclusivity periods to file a plan free from the threat of a rival proposal. Originally, Innkeepers was going to ask for an extension until Jan. 12 to file a plan and March 19 to solicit credit or votes on the proposal, but a lawyer said the company had scaled the request back to Nov. 10 and would come to court just before that if it needs more time. The lawsuit is INNKEEPERS USA TRUST, et al., v. CERBERUS SERIES FOUR HOLDINGS, LLC, CHATHAM LODGING TRUST, INK ACQUISITION LLC, AND INK ACQUISITION II LLC, Adv. Proc. No. Case No. 11-02557 (Bankr. S.D.N.Y.). Attorneys for Cerberus are Alan R. Glickman, Esq., Howard O. Godnick, Esq., Adam C. Harris, Esq., and Michael E. Swartz, Esq., at Schulte Roth & Zabel LLP, in New York, serve as counsel. Attorneys at Wachtell, Lipton, Rosen & Katz, serve as counsel to Chatham. About Innkeepers USA Trust Innkeepers USA Trust is a self-administered Maryland real estate investment trust with a primary business focus on acquiring premium-branded upscale extended-stay, mid-priced limited service, and select-service hotels. Innkeepers, through its indirect subsidiaries, owns and operates an expansive portfolio of 72 upscale and mid-priced extended-stay and select-service hotels, consisting of approximately 10,000 rooms, located in 20 states across the United States. Apollo Investment Corporation acquired Innkeepers in June 2007. Innkeepers USA Trust and 91 affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-13800) on July 19, 2010. The Company's consolidated assets for 2009 totaled approximately $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred $1.29 billion of secured debt. Paul M. Basta, Esq., at Kirkland & Ellis LLP, in New York; Anup Sathy, P.C., Esq., Marc J. Carmel, Esq., at Kirkland & Ellis in Chicago; and Daniel T. Donovan, Esq., at Kirkland & Ellis in Washington, D.C., serve as counsel to the Debtors. AlixPartners is the restructuring advisor and Marc A. Beilinson is the chief restructuring officer. Moelis & Company is the financial advisor. Omni Management Group, LLC, is the claims and notice agent. Attorneys at Morrison & Foerster, LLP, represent the Official Committee of Unsecured Creditors. INTERNATIONAL RARITIES: Panel, Trustee Object to Plan Outline ------------------------------------------------------------- Dan Browning at Star Tribune reports that the U.S. Trustee and the official committee of unsecured creditors in the bankruptcy case of International Rarities Corp. object to a plan to restructure IRC's debts. According to the report, the committee wants additional information about a June investigation of the company by the U.S. Securities and Exchange Commission, as well as any regulatory issues that might affect the company. It wants to know of any relationship between IRC owner David Marion and Stephen Hastings, a turnaround executive he hired in mid-July when Mr. Marion resigned as CEO. Mr. Browning says the committee cited a report in the Star Tribune about a pending federal investigation into the Company. Mr. Browning says the committee also wants information about what it described as "excess" distributions that Mr. Marion took from the company as its performance deteriorated in recent years; and Mr. Marion to disclose the truth or falsity of certain fraud claims made against IRC by Dean Dellinger, 89, of Milton, Florida. The report says the committee characterized a lawsuit Mr. Dellinger filed in a federal court in Florida as an indictment of IRC's business operations, "from top to bottom." Mr. Browning also reports that Michael Fadlovich, an attorney for Trustee Habbo Fokkena, said IRC's restructuring plan lacked so much information that it's deficient "on its face." The report relates that IRC's plan to repay its creditors is based on the company's historic cash flows, plus the collection of nearly $900,000 from Marion personally. But Mr. Fadlovich said the company's bank account at Affinity Plus credit union was frozen after federal agents raided its offices on Sept. 7, seizing computers, customer lists and financial records. He said the company has been unable to recover its customer lists from federal agents and doesn't appear likely to do so in the near future. The report says Mr. Hastings testified at a meeting of unsecured creditors that without the customer lists, IRC would be unable to achieve its plan to repay its creditors and investors in a related entity called International Rarities Holdings. The report notes Mr. Fadlovich said IRC's plan to repay IRH investors sets up an inherent conflict of duties. In addition, he said, IRC's restructuring plan requires that Marion repay the company for excess distributions he took totaling $896,357. The plan calls for Mr. Marion to make payments over five years at 4 percent annual interest. That would require payments of $16,452.93 a month, Mr. Fadlovich said. But Mr. Marion, who's working as an independent "closer" through IRC, is being paid a base salary of $10,000 a month, the report says. The report adds the cash flow from Mr. Marion and IRC's projected future operations "is wholly inadequate to make full payment over time of claims that exceed $2.2 million," Mr. Fadlovich argued. He said because of its numerous deficiencies, the plan should not be approved. A hearing on the matter, according to the report, has been set for Oct. 12 in Minneapolis. Coin dealer International Rarities Corp., in Minneapolis, Minnesota, filed for Chapter 11 bankruptcy protection (Bankr. D. Minn. Case No. 11-45512) on Aug. 19, 2011, disclosing assets of $1,353,295 and liabilities of $3,025,921. Judge Robert J. Kressel presides over the case. Thomas G. Wallrich, Esq., at Hinshaw & Culbertson LLP, represents the Debtor. Matthew Burton, Esq. -- mburton@losgs.com -- at Leonard, O'Brien, Spencer, Gale & Sayre, represents the creditors' committee. JELD-WEN INC: S&P Assigns 'B' Corporate Credit Rating ----------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Klamath Falls, Ore.-based Jeld-Wen Inc. "At the same time, we assigned a 'B-' issue-level rating (one notch below the corporate credit rating) to JELD-WEN's $460 million senior secured notes due 2017. The recovery rating is '5', indicating our expectation for modest (10% to 30%) recovery for lenders in the event of a payment default. The rating outlook is stable," S&P related. The company partially refinanced its existing debts with the notes proceeds. In conjunction with this transaction, private equity firm Onex Corp. invested $700 million in convertible preferred stock and $189 million in an 18-month bridge loan (also convertible into preferred convertible stock if not repaid before maturity) to complete the refinancing of existing debt of approximately $1.2 billion. "The 'B' rating on JELD-WEN reflects what we consider to be the company's highly leveraged financial risk profile, resulting from its high debt and relatively modest free cash flow generation," said Standard & Poor's credit analyst Thomas Nadramia. "We expect total pro forma adjusted debt (including $700 million preferred convertible stock) will be in excess of 10x EBITDA." "The ratings also reflect what we consider to be the company's weak business risk profile because JELD-WEN is highly dependent on the currently depressed residential construction and remodeling end markets, has thin operating profit margins, and operates in highly competitive markets," added Mr. Nadramia. Still, the company maintains a leading position in residential doors in North America, Europe, and Australia, and possesses good geographic diversity, with more than 50% of revenues and profits from outside of the U.S. "The rating and outlook incorporates our expectation that demand for JELD-WEN's window and door products, which the company sells primarily to residential end markets and account for approximately 90% of sales, will continue to face difficulties over the next several quarters as housing and remodeling markets remain near cyclically low levels. We believe repair and replacement markets, which constitute about 47% of JELD-WEN's sales, will be flat for the remainder of 2011. Weak housing markets in both the U.S. and Europe will likely continue to affect new residential construction, which accounts for 41% of JELD-WEN's worldwide sales. In the U.S., Standard & Poor's economists expect approximately 590,000 total housing starts for 2011, roughly the same as 2010 and still well below historical averages. The weakness in U.S. markets will be partially offset by better market conditions in Canada, Europe, and Australia, where JELD-WEN derives over 50% of its revenues. We expect sales of the company's products related to commercial end markets in Europe, which represent about 12% of recent sales, to remain flat for the remainder of 2011 and into 2012," S&P stated. "The stable rating outlook reflects our expectation that JELD- WEN's operating performance during the next several quarters will likely be flat to showing modest improvement, primarily thanks to internal cost saving measures, as we expect market conditions to remain weak. As a result, we expect credit measures to remain in line with the ratings given the company's weak business risk profile. We expect adjusted leverage to be about 10x over the next year based on adjusted EBITDA of about $150 million and cash interest coverage of about 2x. The stable rating outlook also reflects our expectation that liquidity will be adequate to meet all of the company's obligations over the next year, given the expected $50 million in cash as well as nearly full availability under the new $300 million revolving credit facility," S&P stated. "We could take a negative rating action if sales and adjusted EBITDA were to fall below our projected level of about $150 million in 2011 and 2012, which could result from a double-dip recession and reduced construction activity, or if the company fails to achieve benefits derived from its ongoing restructuring efforts," S&P related. For a lower rating, EBITDA would have to decline about 25% from projected levels for interest coverage to fall below 1.5x. Downward rating pressure could also occur if a decline in EBITDA caused the company to use cash to fund operating losses, resulting in a drop in liquidity materially below the projected $350 million of combined cash on hand and revolver availability. "A positive rating action, although unlikely in the near term, could occur if a greater-than-expected recovery in residential and commercial construction were to result in leverage to fall below 7x. For this to occur we project EBITDA would have to improve to $250 million or higher," S&P said. JMG ACQUISITION: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: JMG Acquisition #1, Ltd. P.O. Box 114 Yorktown, TX 78164 Bankruptcy Case No.: 11-12441 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: Craig A. Gargotta Debtor's Counsel: Douglas J. Powell, Esq. LAW OFFICES OF DOUGLAS J. POWELL, P.C. 820 West 10th Street Austin, TX 78701 Tel: (512) 476-2457 Fax: (512) 477-4503 E-mail: notices@swbell.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 John Golden, general partner, Golden/Dunson, LLC. JMR DEVELOPMENT: Hires Luis R. Carrasquillo as Accountant --------------------------------------------------------- JRM Development Group Corporation asks permission from the U.S. Bankruptcy Court for the District of Puerto Rico to appoint CPA Luis R. Carrasquillo & CO., P.S.C as financial accountant. Upon retention, the firm will, among other things: a) assist the Debtor in the financial restructuring of its affairs by providing advice in strategic planning; b) prepare the Debtor's plan of reorganization, disclosure statement and business plan; and c) participate in the Debtor's negotiations with creditors. The Debtor has retained Carrasquillo on the basis of $10,000 advance by the Debtor, against which Carrasquillo has billed and will bill as per the hourly billing rates. The firm's hourly rates are: Personnel Rates --------- ----- CPA Luis R. Carrasquillo, Partner $160 CPA Marcelo Gutierrez, Senior CPA $125 Other CPAs $90-$125 Lionel Rodriguez Perez, Senior Accountant $85 Carmen Echevarria, Senior Accountant $75 Omara Torres Ortiz, Senior Tax Specialist $75 Sandra Zavala Diaz, Junior Accountant $50 Janet Marrero, Administrative & Support $35 Iris L. Franqui, Administrative & Support $35 Luis R. Carrasquillo Ruiz, CPA, attest that the firm and its members are disinterested persons, as defined in 11 U.S.C. Sec. 101(14). About JMR Development Group JMR Development Group Corp. filed a Chapter 11 petition (Bankr. D. P.R. Case No. 11-07907) on Sept. 16, 2011, in Ponce, Puerto Rico. Charles A Curpill PSC Law Office serves as counsel to the Debtor. The Debtor scheduled assets of US$12,732,474 and debts of US$48,587,611. An affiliate, JMR Tourist Development Group Corp. sought Chapter 11 protection (Case No. 11-07911) on the same day. JMR DEVELOPMENT: Taps Charles A. Cuprill as Bankruptcy Attorney --------------------------------------------------------------- JRM Development Group Corporation asks permission from the U.S. Bankruptcy Court for the District of Puerto Rico to appoint Charles A. Cuprill, P.S.C., Law Offices as attorney. The law firm's address is: Charles A. Cuprill, P.S.C., Law Offices 356 Fortaleza Street, Second Floor San Juan, PR 00901 Tel: (787) 977-0515 Fax: (787) 977-0518 The firm's principal, Charles A. Cuprill-Hernandez, Esq., attests that the members of the firm are disinterested persons as defined in 11 U.S.C. Sec. 101(14). The firm's hourly rates are: Personnel Rates --------- ----- Charles A. Cuprill-Hernandez, Esq. $300 Senior Associates $225 Junior Associates $150 Paralegals $85 About JMR Development Group JMR Development Group Corp. filed a Chapter 11 petition (Bankr. D. P.R. Case No. 11-07907) on Sept. 16, 2011, in Ponce, Puerto Rico. CPA Luis R. Carrasquillo & CO., P.S.C serves as financial accountant. The Debtor scheduled assets of US$12,732,474 and debts of US$48,587,611. An affiliate, JMR Tourist Development Group Corp. sought Chapter 11 protection (Case No. 11-07911) on the same day. KEYUAN PETROCHEMICALS: Receives NASDAQ Delisting Notice ------------------------------------------------------- Keyuan Petrochemicals, Inc. disclosed that on October 5, 2011, the Company received a letter from the NASDAQ Hearings Panel regarding the Company's appeal to remain listed. NASDAQ notified the Company that its common stock will be suspended from the Nasdaq Stock Market effective October 6. Management, the board of directors and the independent committees all worked diligently to provide the Nasdaq with all requested information in a timely manner and meet the deadlines previously imposed. Despite the Company's best efforts to become compliant on all of NASDAQ's requirements, the Panel suspended Keyuan's listing from the Nasdaq Stock Market. As a result, the Company's shares will resume trading in the pink sheets under the ticker symbol KEYP beginning Friday, October 7. The final audit and Form 10K for 2010, in addition to the 10-Q for both the first and second quarter of 2011, is expected to be filed as soon as possible in the middle of October with the Securities and Exchange Commission. The 10-K will contain details surrounding the operations, financials, and a comprehensive list of actions the Company has taken and is committed to taking in order to remediate accounting and internal control issues. Given the significant capital allocation from the Company's U.S. dollar account for this investigation, review and report, the dividend payment was not declared in September as anticipated. The Company and the board are evaluating its current dividend policy for shareholders. "The entire management team is extremely disappointed in this decision given that we did everything which was asked," stated Chungfeng Tao, Chairman and Chief Executive Officer. "We have done everything within our power to address the independent review, to complete our 2010 audit and the financial filings for the first two quarters of 2011, which we are in the process of finalizing to submit to the SEC. We will submit an appeal to the NAsdaq with the hope that once all filings are up to date, we can be reinstated, however there is no assurance that the appeal will be granted. The Company spent approximately $5 million, 5 months, and significant corporate resources to complete the investigation and become compliant with the Nasdaq requirements. It is extremely important that our shareholders understand that the Company is continuing to operate and has not ceased operations of the business. If we are unsuccessful in achieving a main board listing, the Company will actively pursue strategic alternatives including but not limited to taking the company private, a merger or other transaction which will maximize shareholder value, and ensure we can meet our growth objectives." About Keyuan Petrochemicals Keyuan Petrochemicals, Inc., established in 2007 and operating through its wholly-owned subsidiary, Keyuan Plastics Co., Ltd., is located in Ningbo, China and is a leading independent manufacturer and supplier of various petrochemical products. Having commenced production in October 2009, Keyuan's operations include an annual petrochemical manufacturing design capacity of 720,000 MT for a variety of petrochemical products, with facilities for the storage and loading of raw materials and finished goods, and a technology that supports the manufacturing process with low raw material costs and high utilization and yields. In order to meet increasing market demand, Keyuan plans to expand its manufacturing capacity to include a SBS production facility, additional storage capacity, a raw material pre-treatment facility, and an asphalt production facility. KINGSWAY FINANCIAL: A.M. Best Cuts Issuer Credit Ratings to 'C' --------------------------------------------------------------- A.M. Best Co. has downgraded the issuer credit ratings (ICR) to "c" from "ccc" and senior debt ratings to "c" from "ccc" of Kingsway Financial Services Inc (KFSI) and Kingsway America Inc. (KAI). A.M. Best also has downgraded the financial strength rating (FSR) to C+ (Marginal) from B- (Fair) and ICR to "b-" from "bb-" of Kingsway Reinsurance Corporation (KRC) (Barbados) as well as the Mendota Group and its members, Mendota Insurance Company and its wholly owned subsidiary, Mendakota Insurance Company (both are domiciled in Eagan, MN). All the above ratings have been removed from under review with negative implications and assigned a negative outlook. Additionally, A.M. Best has affirmed the FSR of D (Poor) and ICR of "c" of Universal Casualty Company (UCC). The outlook for both ratings is negative. (Please see below for a detailed listing of the debt ratings.) All companies are headquartered in Elk Grove Village, IL, unless otherwise specified. The rating actions on the Mendota Group, KFSI, KAI and KRC follow A.M. Best's discussions with KFSI regarding the results of its research into various recapitalization strategies for the holding companies, which to date have yet to materialize. These discussions are in response to the holding company's year-end 2010 loss in equity of over $55 million, as well as its continued $19 million in equity losses through the second quarter of 2011. A.M. Best will continue to monitor management's efforts to recapitalize KFSI, KAI and the Mendota Group. The ratings for KFSI and its affiliates recognize their weak risk- adjusted capitalization, above average financial and operating leverage, continued unprofitable earnings trends and the challenges they face from strong competitive markets, weak economic conditions, below average interest rates, declining premium volume and rising claims costs. These concerns are partially offset by KFSI's actions to reorganize operations to improve efficiency and customer service; de-leverage its balance sheet and improve liquidity by selling assets for cash and reducing debt; improve performance by cancelling non-core lines of business; unprofitable agents and accounts; focus on core non-standard automobile insurance and consolidate management and back office operations. The ratings for UCC reflect its severe adverse reserve development at year-end 2010, which caused risk-adjusted capitalization to not support its ratings after reserves were strengthened. The following debt ratings have been downgraded: Kingsway America Inc.? -- to "c" from "ccc" on USD 125 million 7.5% senior unsecured notes, due 2014 (currently USD 27 million outstanding) -- to "c" from "ccc" on CAD 74.1 million 7.12% senior unsecured notes, due 2015 (currently CAD 19.7 million of the related KLROC debt is in the possession of non-KFSI owners) Kingsway Financial Services Inc? -- to "c" from "ccc" on CAD 100 million 6% senior unsecured debentures, due 2012 (currently CAD 1.9 million outstanding) All senior debt is unconditionally guaranteed by KFSI and KAI. LEE WILLIAMS: Case Summary & 8 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Lee William Development, L.P. 19425 Soledad Canyon Road Ste 328 Santa Clarita, CA 91351 Bankruptcy Case No.: 11-51474 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Central District Of California (Los Angeles) Judge: Ellen Carroll Debtor's Counsel: Nolan E. Clark, Esq. LAW OFFICE OF NOLAN E. CLARK 123 2nd Ave #T-8 Salt Lake City, UT 84103 Tel: (801) 505-9916 Scheduled Assets: $5,465,000 Scheduled Debts: $2,783,000 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb11-51474.pdf The petition was signed by Jonathan Swauger, general partner. LEVEL 3: To Assume Outstanding Awards Under Global Crossing Plan ---------------------------------------------------------------- Level 3 Communications, Inc., amended its Registration Statement on Form S-4, as amended, by filing a Post-Effective Amendment No. 1 on Form S-8 relating to 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. A full-text copy of the Form S-8 POS filing is available at no charge at http://is.gd/KlmRhL 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: STT Crossing Discloses 24.8% Equity Stake -------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, STT Crossing Ltd and its affiliates disclosed that they beneficially own 757,478,896 shares of common stock of Level 3 Communications, Inc., representing 24.8% of the shares outstanding. A full-text copy of the filing is available for free at http://is.gd/KSmT2x 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. LOCATION BASED TECH: Presents at Craig-Hallum Annual Conference --------------------------------------------------------------- Location Based Technologies, Inc., announced that Chief Operating Officer, Desiree Mejia presented at the Craig-Hallum 2nd Annual Alpha Select Conference on Thursday, October 6. The one-day conference was held at The Roosevelt Hotel in New York City. The Craig-Hallum 2nd Annual Alpha Select Conference showcased over 65 small and micro cap companies that fit the Alpha Select List (ASL) criteria. The idea behind the conference is to give institutional investors the opportunity to prospect for new investment ideas that may either be under the radar or that have proven out their model and are executing successfully. Presenting companies encompass four general sectors: Consumer, Healthcare, Services and Technology along with many Special Situation opportunities. 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 stockholders' deficit. LODGENET INTERACTIVE: David Bankers Resigns from All Positions -------------------------------------------------------------- LodgeNet Interactive Corporation and David M. Bankers have mutually agreed to the termination of Mr. Bankers' employment with the Company, effective as of Oct. 1, 2011. As of that date, Mr. Bankers resigned from all his positions with the Company and its subsidiaries and affiliates, including his positions as the Company's Senior Vice President, Product and Technology Development. Mr. Bankers' departure from the Company is not the result of any disagreement with the Company on any matter relating to the Company's operations, policies or practices. Mr. Bankers will be available to provide an orderly transition of his duties and will provide consulting services to the Company as needed. Mr. Bankers will be paid the amounts owed to him under his existing Employment Agreement. The Company has engaged a firm to conduct an executive search. About LodgeNet Interactive Sioux Falls, South Dakota-based LodgeNet Interactive Corporation (Nasdaq:LNET), formerly LodgeNet Entertainment Corp. -- http://www.lodgenet.com/-- provides media and connectivity solutions designed to meet the unique needs of hospitality, healthcare and other guest-based businesses. LodgeNet Interactive serves more than 1.9 million hotel rooms worldwide in addition to healthcare facilities throughout the United States. The Company's services include: Interactive Television Solutions, Broadband Internet Solutions, Content Solutions, Professional Solutions and Advertising Media Solutions. LodgeNet Interactive Corporation owns and operates businesses under the industry leading brands: LodgeNet, LodgeNetRX, and The Hotel Networks. The Company reported a net loss of $11.68 million on $452.17 million of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $10.15 million on $484.49 million of total revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $419.22 million in total assets, $470.10 million in total liabilities, and a $50.87 million total stockholders' deficiency. * * * Lodgenet carries a 'B3' long term corporate family rating and a 'Caa1' probability of default rating, with 'stable' outlook, from Moody's. It has 'B' long term foreign and local issuer credit ratings, with 'stable' outlook, from Standard & Poor's. "In Moody's opinion, continued cautious investment from LodgeNet's hotel customers will hamper intermediate term growth in its core hospitality services business, and over the long term competing forms of entertainment will pressure this revenue stream as the company seeks to defend its relevance to both hotel operators and hotel guests. The B3 corporate family rating incorporates these weak growth prospects, mitigated somewhat by the company's moderately high financial risk profile and demonstrated capacity to generate positive free cash flow throughout challenging economic conditions, along with a measure of stability from the monthly fees it receives from hotels regardless of occupancy," Moody's said in October 2010. LOUISIANA HOUSING: S&P Lowers Rating on Revenue Bonds to 'B-' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term rating on Louisiana Housing Finance Agency's (Meadowbrook Apartments Project) multifamily housing revenue bonds series 2006 to 'B-' from 'BB+'. "The downgrade is based on our view of the project's reliance on short-term market rate investments," said Standard & Poor's credit analyst Renee J. Berson. The rating reflects S&P's view of these: Revenues from mortgage debt service payments and investment earnings are insufficient to pay full and timely debt service on the bonds plus fees until remarketing date; Debt service coverage is projected to fall below investment- grade levels beyond 2014; and Asset/liability parity is projected to fall below 100% beginning March 2015. Credit strengths in the issue include S&P's opinion of: Investments held in First American Treasury Obligations Fund Class D money market fund; and The high credit quality of the Fannie Mae standby credit facility, which S&P consider to be 'AA+' eligible. "Standard & Poor's has analyzed updated financial information based on our current stressed reinvestment rate assumptions for all scenarios as set forth in the criteria for certain federal government-enhanced housing transactions. We believe the bonds are unable to meet all bond costs from transaction revenues until remarketing date, assuming no reinvestment earnings on securities," S&P related. M WAIKIKI: Seeks Court Approval to Hire Neligan Foley as Counsel ---------------------------------------------------------------- M Waikiki, LLC seeks permission from the United States Bankruptcy Court for the District of Hawaii to employ Neligan Foley LLP as its counsel, nunc pro tunc to the Petition Date. As counsel, Neligan Foley will render these services to the Debtor: (a) advise M Waikiki, its management, officers, and directors of its rights, powers, and duties as a debtor-in- possession; (b) counsel M Waikiki's management, officers, and directors on issues involving operations, potential sales of assets, and possible financing options as well as negotiate documents, prepare pleadings, and represent M Waikiki at hearings related to those matters; (c) take all necessary actions to protect and preserve M Waikiki's estate, including prosecuting litigation M Waikiki's behalf, investigating claims of M Waikiki, defending M Waikiki, if necessary, in any actions, litigations, hearings or motions commenced against M Waikiki, negotiating disputes in which M Waikiki is involved, and preparing objections to claims filed against the estate; (d) prepare on behalf of M Waikiki all necessary motions, applications, answers, pleadings, orders, reports, and papers in connection with the administration of the estate or in furtherance of M Waikiki's business operations, or as required to preserve M Waikiki's assets, and as otherwise requested by M Waikiki's management; (e) negotiate and draft documents relating to debtor-in- Possession financing and/or use of cash collateral as well as attend any hearings on these matters, prepare discovery and respond to discovery served on M Waikiki, respond to creditor inquiries and information requests, assist with preparation of Schedules, Statement of Affairs, Monthly Operating Reports, attendance at the 341 meeting and representation at meetings with creditors as well as any committee appointed by the United States Trustee; (f) draft, negotiate, and prosecute on behalf of M Waikiki a plan or plans of reorganization, the related disclosure statement(s), and any revisions, amendments, and supplements relating to these documents, and all related materials; (g) perform all other necessary legal services in connection with the Chapter 11 case and any other bankruptcy-related representation that M Waikiki requires; and (h) handle all litigation, discovery, and other matters for M Waikiki arising in connection with the Chapter 11 case. The firm will be paid based on its customary hourly rates: Partners $395 - $550 Paralegals and Associates $130 - $275 Prior to the filing of the petition, Neligan Foley received a deposit of $347,000 from M Waikiki to represent M Waikiki in preparation for, and in this Chapter 11 proceeding. Neligan Foley applied $14,709.82 of these funds to prepetition fees and expenses and forwarded $100,000 of these funds to Klevansky Piper LLP, the Debtor's proposed local counsel, to be held by Klevansky Piper as a retainer to be applied to postpetition fees and expenses as approved by the Court. Thus, Neligan Foley is now holding $232,290.18 in trust for M Waikiki. The Retainer will be applied to fees and expenses that are incurred in the course of M Waikiki's bankruptcy proceedings and approved by the Court in connection with M Waikiki's bankruptcy proceeding. If, at the conclusion of the case, Neligan Foley's fees and expenses ultimately are approved in an aggregate amount less than the amount of the Retainer, Neligan Foley will return any remaining portion of the Retainer. Patrick J. Neligan, Jr., a partner, at Neligan Foley, assures the Court that his firm represents no interests adverse to M Waikiki and that Neligan Foley is a "disinterested person," as 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. 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. M WAIKIKI: Seeks Nod to Tap Klevansky Piper as General Counsel -------------------------------------------------------------- M Waikiki, LLC, seeks authority from the United States Bankruptcy Court for the District of Hawaii to employ Klevansky Piper, LLP, as its general counsel in its Chapter 11 case. As general counsel, Klevansky Piper will: (a) advise M Waikiki, its management, officers, and directors of its rights, powers, and duties as a debtor-in- possession; (b) counsel M Waikiki' s management, officers, and directors on issues involving operations, potential sales of assets, and possible financing options as well as negotiate documents, prepare pleadings, and represent M Waikiki at hearings related to those matters; (c) take all necessary actions to protect and preserve M Waikiki's estate, including prosecuting litigation M Waikiki's behalf, investigating claims of M Waikiki, defending M Waikiki, if necessary, in any actions, litigations, hearings or motions commenced against M Waikiki, negotiating disputes in which M Waikiki is involved, and preparing objections to claims filed against the estate; (d) prepare on behalf of M Waikiki all necessary motions, applications, answers, pleadings, orders, reports, and papers in connection with the administration of the estate or in furtherance of M Waikiki' s business operations, or as required to preserve M Waikiki's assets, and as otherwise requested by M Waikiki's management; (e) negotiate and draft documents relating to debtor-in- possession financing and/or use of cash collateral as well as attend any hearings on such matters, prepare discovery and respond to discovery served on M Waikiki, respond to creditor inquiries and information requests, assist with preparation of Schedules, Statement of Affairs, Monthly Operating Reports, attendance at the 341 meeting and representation at meetings with creditors as well as any committee appointed by the United States Trustee; (f) draft, negotiate, and prosecute on behalf of M Waikiki a plan or plans of reorganization, the related disclosure statement(s), and any revisions, amendments, and supplements relating to the foregoing documents, and all related materials; (g) perform all other necessary legal services in connection with this Chapter 11 case and any other bankruptcy-related representation that M Waikiki requires; and (h) handle all litigation, discovery, and other matters for M Waikiki arising in connection with the Chapter 11 case. The firm will be paid based on its customary hourly rates: Partners $290 - $390 Paralegals and Associates $100 - $180 Prior to the filing of the petition, Klevansky Piper received a deposit of $100,000 from M Waikiki -- through Neligan Foley, LLP - - to represent M Waikiki in the Chapter 11 proceeding. These funds are being held by Klevansky Piper as a retainer to be applied to postpetition fees and expenses as approved by the Court. The Retainer will be applied to fees and expenses that are incurred in the course of M Waikiki's bankruptcy proceedings and approved by the Court in connection with M Waikiki's bankruptcy proceeding. If, at the conclusion of the case, Klevansky Piper's fees and expenses ultimately are approved in an aggregate amount less than the amount of the Retainer, Klevansky Piper will return any remaining portion of the Retainer. Simon Klevansky, a partner at the firm assures the Court that Klevansky Piper represents no interests adverse to M Waikiki and that his firm is a "disinterested person," as 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. 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. MANISTIQUE PAPERS: Taps Godfrey & Kahn as Lead Counsel ------------------------------------------------------ Manistique Papers, Inc., sought and obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ Godfrey & Kahn, S.C. as its lead counsel, effective August 12, 2011. As the Debtor's counsel, Godfrey & Kahn will: (a) Advise the Debtor of its rights, powers and duties as debtor and debtor-in-possession and the continued management and operation of its business and property; (b) Advise the Debtor concerning, and assisting in the negotiations and documentation of, financing agreements, debt restructurings, and related transactions; (c) Review the nature and validity of liens asserted against the property of the Debtor and advising the Debtor concerning the enforceability of the liens; (d) Advise the Debtor concerning the actions that it might take to collect and to recover property for the benefit of the Debtor's estate; (e) Prepare on behalf of the Debtor all necessary and Appropriate applications, motions, pleadings, draft orders, notices, schedules and other documents, and review all financial and other reports to be filed in this case, and advising the Debtor regarding responses to the court papers; (f) Counsel the Debtor in connection with the negotiation and promulgation of a plan of reorganization and related documents; (g) Counsel the Debtor in connection with any sales outside of the ordinary course of business under Section 363 of the Bankruptcy Code; (h) Attend meetings and negotiations with representatives of creditors and other parties-in-interest and advise and consult on the conduct of this bankruptcy case, including all of the legal and administrative requirements of operating in bankruptcy; (i) Appear before the Bankruptcy Court and any appellate courts and maintain communications with the U.S. Trustee; and (j) Perform all other legal services for and on behalf of the Debtor that may be necessary or appropriate in the administration of this case and the reorganization of the Debtor's business, including advising and assisting the Debtor with respect to debt restructurings, stock or asset dispositions, claim analysis and disputes, and legal issues involving general manufacturing, corporate, bankruptcy, labor, environmental, employee benefits, tax, finance, real estate and litigation matters. The firm will be paid based on its hourly rates: Billing Category Range ---------------- ----- Shareholders $350 - $525 Special Counsel $300 - $515 Associates $185 - $340 Paralegals $165 - $200 The names, positions and current hourly rates of the Godfrey & Kahn professionals and paraprofessionals presently expected to have primary responsibility for providing services to the Debtor are: Timothy F. Nixon (Shareholder) $470/hour John E. Donahue $450/hour Paul W. Griepentrog (Shareholder) $400/hour Christine L. McLaughlin (Shareholder) $400/hour Carla O. Andres (Special Counsel) $350/hour Jennifer B. Herzog (Associate) $285/hour Tom G. O'Day (Associate) $275/hour Peggy L. Barlett (Associate) $225/hour Gale Raiche (Paralegal) $165/hour Emily Seelig(Paralegal) $165/hour In addition, from time to time, it may be necessary for other Godfrey & Kahn professionals to provide services to the Debtor. Godfrey & Kahn does not represent and does not hold any interest adverse to the Debtor or its estate, creditors, or equity security holders in the matters for which Godfrey & Kahn is proposed to be retained. Accordingly, Godfrey & Kahn is a "disinterested person" within the meaning of Sections 101(14) and 327 of the Bankruptcy Code. About Manistique Papers Manistique Papers Inc. operates a landfill in Manistique, Michigan, whereby residuals resulting from paper production are deposited. Manistique Papers filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-12562) on Aug. 12, 2011. Manistique Papers estimated assets of $10 million to $50 million and debts of $50 million to $100 million in its Chapter 11 petition. MANISTIQUE PAPERS: Hires Morris Nichols as Delaware Co-counsel -------------------------------------------------------------- Manistique Papers, Inc. sought and obtained approval from the U.S. Bankruptcy Court for the District of Delaware to employ Morris, Nichols, Arsht & Tunnell LLP as its Delaware bankruptcy co- counsel, nunc pro tunc to August 12, 2011. As Delaware co-counsel, Morris Nichols will render these professional services for the Debtor: (a) assist Godfrey & Kahn, S.C. with representing the Debtor in connection with the bankruptcy case; (b) perform all necessary services as the Debtor's Delaware bankruptcy co-counsel, including, without limitation, providing the Debtor with advice, representing the Debtor, and preparing necessary documents on behalf of the Debtor in the areas of restructuring and bankruptcy; (c) take all necessary actions to protect and preserve the Debtor's estate during the chapter 11 case, including the prosecution of actions by the Debtor, the defense of any actions commenced against the Debtor, negotiations concerning litigation in which the Debtor is involved, and objecting to claims filed against the estate; (d) prepare or coordinate preparation on behalf of the Debtor, as debtor-in-possession, necessary motions, applications, answers, orders, reports, and papers in connection with the administration of the chapter 11 case; (e) counsel the Debtor with regard to its rights and obligations as debtor-in-possession; and (f) perform certain other necessary legal services. The Debtor will pay Morris Nichols based on its professionals' current hourly rates of: Partners $475 to $770 Associates $275 to $465 Paraprofessionals $220 Case Clerks $130 The firm will also be reimbursed for necessary expenses incurred. Morris Nichols was engaged by the Debtor on August 8, 2011. Prior to the Petition Date, the Debtor made payments to Morris Nichols totaling $35,000 in connection with advice and services regarding financial restructuring and related matters, including, inter alia, the preparation and filing of this case. Of the prepetition amounts received by Morris Nichols, Morris Nichols applied $32,929.90 as payment for service rendered and expenses incurred up to the Petition Date. Accordingly, Morris Nichols currently holds a balance of $2,070.10 as an advance payment for services to be rendered and expenses to be incurred in connection with its representation of the Debtor. Morris Nichols has not received any other compensation from the Debtor. The firm does not hold or represent any interest adverse to the Debtor's estate or its creditors. Therefore, Morris Nichols is a "disinterested person" under Section 101(14) of the Bankruptcy Code. About Manistique Papers Manistique Papers Inc. operates a landfill in Manistique, Michigan, whereby residuals resulting from paper production are deposited. Manistique Papers filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-12562) on Aug. 12, 2011. Manistique Papers estimated assets of $10 million to $50 million and debts of $50 million to $100 million in its Chapter 11 petition. MARKET STREET: Court OKs Morphy Makofsky as Consulting Engineers ---------------------------------------------------------------- Market Street Properties, LLC, sought and obtained permission from the U.S. Bankruptcy Court for the Eastern District of Louisiana to employ Morphy Makofsky, Inc. as consulting engineers. The Debtor believes that Morphy is likely an ordinary course professional and that this application is not strictly necessary. Morphy's services include, among other things: -- conducting a visual inspection of the condition of the structure of the building to identify any structural defects, any signs of structural stress or deformation, or any signs of material deformation; and -- directing and managing surveyor to measure all beams and columns and performing engineering calculations to determine the cross-sectional areas, moments of inertia, and section modules. The hourly rates of Morphy's personnel are: Principal $199 Senior Engineer $161 Junior Engineer $118 Senior Drafter $83 Junior Drafter $68 Field Engineer/Inspector $101 Specification Writer $91 Clerical $60 To the best of the Debtor's knowledge, Morphy is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Market Street Properties Oceanside, New York-based Market Street Properties, L.L.C., owns an approximately 500,000 square-foot power plant, two substations, and three parcels of vacant land. It filed for Chapter 11 bankruptcy (Bankr. E.D. La. Case No. 09-14172) on Dec. 23, 2009, represented by Christopher T. Caplinger, Esq., Joseph Patrick Briggett, Esq., and Stewart F. Peck, Esq., at Lugenbuhl Wheaton Peck Rankin & Hubbard, in New Orleans. Cupkovic Architecture LLC serves as the Debtor's architect; and Patrick J. Gros, CPA, as accountant. James E. Fitzmorris, Jr., serves as political consultant and advisor. No trustee or examiner has been appointed in the case. The Company disclosed $52,404,026 in assets and $26,848,596 in liabilities as of the Chapter 11 filing. MARKET STREET: Court OKs James Fitzmorris as Political Consultant ----------------------------------------------------------------- Market Street Properties, LLC, sought and obtained permission from the U.S. Bankruptcy Court for the Eastern District of Louisiana to employ James E. Fitzmorris, Jr. as political consultant and advisor. Mr. Fitzmorris will be assisting the Debtor in the development of an approximately 500,000 square foot power plant, two substations, and three parcels of vacant land. The Debtor will pay Mr. Fitzmorris a monthly fee of $6,000. The employment will be on a monthly basis and can be terminated by either party at any time. To the best of the Debtor's knowledge, Mr. Fitzmorris is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Market Street Properties Oceanside, New York-based Market Street Properties, L.L.C., owns an approximately 500,000 square-foot power plant, two substations, and three parcels of vacant land. It filed for Chapter 11 bankruptcy (Bankr. E.D. La. Case No. 09-14172) on Dec. 23, 2009, represented by Christopher T. Caplinger, Esq., Joseph Patrick Briggett, Esq., and Stewart F. Peck, Esq., at LUGENBUHL WHEATON PECK RANKIN & HUBBARD, in New Orleans. Cupkovic Architecture LLC serves as the Debtor's architect; and Patrick J. Gros, CPA, as accountant. No trustee or examiner has been appointed in the case. The Company disclosed $52,404,026 in assets and $26,848,596 in liabilities as of the Chapter 11 filing. MARRIOTT VACATIONS: S&P Assigns Prelim. BB- Corp. Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary 'BB-' corporate credit rating to Marriott Vacations Worldwide Corp. (MVW). "Marriott International Inc. plans to spin off timeshare subsidiary MVW by the end of 2011, at which time we will assign our final ratings. The rating outlook is stable," S&P stated. "At the same time, we assigned our preliminary 'B-' preferred stock rating to subsidiary MVW US Holdings Inc.'s proposed $40 million cumulative and mandatorily redeemable preferred stock issue. This preliminary issue-level rating is three notches below the preliminary 'BB-' corporate credit rating for MVW, in accordance with our issue-level rating notching criteria for preferred stock," S&P stated. "The rating reflects MVW's weak business risk profile, which requires external financing to fund lending to customers in the company's capital-intensive and competitive timeshare business," said Standard & Poor's credit analyst Emil Courtney. "The structural financing needs of the business to achieve growth results in our assessment of MVW's business risk profile as weak, at least until we have the opportunity to observe the company's growth and financial policies as a stand-alone company for a reasonable period of time. The rating also reflects our view of MVW's financial risk profile as 'aggressive'." "Under our operating assumptions, we believe MVW is likely to sustain net leverage around the mid-4x area and coverage of around 3x or better, and an adequate overall liquidity profile," added Mr. Courtney. This is in line with an aggressive financial risk assessment for MVW, in S&P view. MOORE SORRENTO: Court Approves Forshey & Prostok as Counsel ----------------------------------------------------------- Moore Sorrento LLC sought and obtained permission from the U.S. Bankruptcy Court for the Northern District of Texas to employ Forshey & Prostok, LLP, as its attorneys, nunc pro tunc to the Petition Date. F&P will advise the Debtor (i) of its rights and duties as debtor- in-possession, (ii) concerning negotiation and documentation of agreements, debt restructurings and related transactions, (iii) concerning actions that it might take to collect and to recover property for its bankruptcy estate, and (iv) in connection with the formulation, negotiation and promulgation of a plan of reorganization and related documents. The Debtor will pay F&P according to the firm's current customary hourly rates: Professional Fee Range ------------ --------- Partners $525 Associates $225 - $400 Of counsel $275 - $425 Paralegals $150 - $175 F&P will also be reimbursed for its actual and necessary expenses. The Debtor paid F&P a $50,000 retainer for its prepetition services. The unused balance of the Retainer will be applied to postpetition services. J. Robert Forshey, Esq., a partner at F&P, attests that his firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Moore Sorrento Hurst, Texas-based Moore Sorrento, LLC, owns real property located in Moore, Oklahoma, commonly known as the Shops at Moore, which the Company operates as a retail shopping center. The center's current 23 tenants offer various goods and services to retail customers. Moore Sorrento filed Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 11-44651) on Aug. 17, 2011. J. Robert Forshey, Esq., and Matthew G. Maben, Esq., at Forshey & Prostok, LLP, in Fort Worth, Tex., serve as the Debtor's counsel. In its schedules, Moore Sorrento disclosed assets of $43,259,900 and liabilities of $42,262,158 as of the Petition Date. MT. MORRIS MUTUAL: A.M. Best Cuts Financial Strength Rating to 'B' ------------------------------------------------------------------ A.M. Best Co. has downgraded the financial strength rating (FSR) to B (Fair) from B++ (Good) and issuer credit rating (ICR) to "bb+" from "bbb" of Mt. Morris Mutual Insurance Company (Mt. Morris) (Coloma, WI). The outlook for the ICR has been revised to negative from stable, while the outlook for the FSR is stable. These rating actions follow Mt. Morris' approximate 40% decline in policyholder surplus as of the second quarter 2011, due to its significant underwriting losses. As a result, the company's risk- adjusted capitalization substantially deteriorated. The ratings also recognize the company's elevated underwriting and investment leverage, limited product diversification and geographic concentration of risks in Wisconsin, which exposes Mt. Morris to competitive market conditions, as well as frequent and severe weather-related events. Offsetting these negative rating factors are Mt. Morris' generally positive operating performance over the last five years and local market knowledge. NALIKA INC: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: Nalika, Inc. dba Dry Clean Super Center 616 Roanoke Dr. Allen, TX 75013 Bankruptcy Case No.: 11-43038 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, general partner. NEW HOLLAND: Files for Bankruptcy; Must File Plan By January 2012 ----------------------------------------------------------------- The Associated Press reports that New Holland Dairy has filed for Chapter 11 bankruptcy reorganization after acquiring at least $6 million in debt. According to the report, the Company must devise a recovery plan by the end of January to satisfy Bank of America. The dairy is continuing to operate in the meantime. Daniel Skekloff, Esq., of Fort Wayne says the dairy was forced into bankruptcy by a drop in milk and real estate prices in 2009. He says high feed costs and other issues two years ago forced dairy farms across the country out of business and prompted the U.S. Department of Agriculture to provide emergency aid. New Holland Dairy operates 1,200 cow dairy facilities in northeastern Indiana. The Company has about $6 million in annual milk sales and 15 employees. Bluffton, Indiana-based New Holland Dairy LLC filed for bankruptcy (Bankr. N.D. Ind. Case No. 11-13644) on Sept. 27, 2011. Judge Robert E. Grant presides over the case. Lawyers at Skekloff, Adelsperger & Kleven, LLP, serve as counsel to the Debtor. In its petition, New Holland Dairy estimated $1 million to $10 million in assets and debts. Affiliate New Holland Dairy Leasing LLC filed a separate petition (Bankr. N.D. Ind. Case No. 11-13651) on the same day, also estimating $1 million to $10 million in assets and debts. NEW JERSEY MOTORSPORTS: Emerges From Chapter 11 Protection ---------------------------------------------------------- Roadracing World Publishing Inc. reports that New Jersey Motorsports Park officially emerged from Chapter 11 bankruptcy protection, just a few months after announcing its reorganization plan. The plan moved quickly from the start, which included a formal announcement on March 7, 2011. According to the report, the confirmed plan included restructuring of debt and company equity, including an investment of $2,100,000 from NEI, LLC, the new majority and managing ownership group headed by Lee Brahin and Richard J. Valentine, and the payment and restructuring of all unsecured debts. The report says, with the reorganization now complete, NJMP has now turned its attention towards preparing promotions for an exciting 2012 racing season, future capital development and new business opportunities. "While the Chapter 11 filing occupied a lot of our time over the last few months, we're proud that we were able to restructure the organization without any interruption to on- or off-track activities this season," said Brad Scott, general manager of New Jersey Motorsports Park. "Interest in NJMP remains high. The quantity of tickets sold were up year-over-year for several of our major events, track rentals have been solid and interest in using NJMP as the host site for non-motorsports activities continues to be a hot topic for us. "We'd like to thank our customers, members, sponsors, track renters, vendors, community partners and staff for their patience and support. Collectively, NJMP is in a better position today to build towards the future, and as we grow we look forward to including all of our stakeholders in our exciting future plans." The report says NJMP is actively working to solidify its 2012 calendar of events, including major spectator events, club races and track days, karting competitions and other motorsports activities while exploring a number of community events such as concerts, festivals, social activities and catering. The complete 2012 schedule of major events is anticipated to be released later this fall. About New Jersey Motorsports Millville, New Jersey-based New Jersey Motorsports Park, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 11-16752) on March 7, 2011. Nella M. Bloom, Esq., at Cohen Seglias Pallas Greenhall & Furman, PC, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $100,001 to $500,000 and debts at $10 million to $50 million. Affiliates New Jersey Motorsports Park Operating Company, LLC (Bankr. D. N.J. Case No. 11-16772), New Jersey Motorsports Park Development Association (Bankr. D. N.J. Case No. 11-16776), and New Jersey Motorsports Park Urban Renewal, LLC (Bankr. D. N.J. Case No. 11-16778) filed separate Chapter 11 petitions on March 7, 2011. In July 2011, Judge Judith Wizmur cleared the Debtor's reorganization plan. NEI Motorsports LLC acquired the facility for $22.5 million at a Court-supervised auction. NEW LEAF: Recasts $606,381 in Existing Secured Loans ---------------------------------------------------- New Leaf Brands, Inc., on Aug. 24, 2011, recast $606,381 in existing secured loans with 6 parties in exchange for 10% Secured Convertible Subordinated Notes which Notes were coupled with common stock. Each Secured Note is collateralized by all of the Company's assets and is convertible into common stock at a conversion price of $0.05 per share. Additionally, those lenders were granted an additional 5 shares of the Company's common stock for each $1.00 of interest and principal due them. On Sept 13-16, 2011, the Company completed a private placement in which it raised aggregate gross proceeds of $250,000 from 2 investors and recast an existing unsecured loan from one investor. The Company issued to these investors the same 10% Secured Convertible Subordinated Notes the Company had issued to the lenders. Additionally, those investors received an additional 5 shares of the Company's common stock for each $1.00 invested. About New Leaf Brands Scottsdale, Ariz.-based New Leaf Brands, Inc. develops, markets and distributes healthy and functional ready-to-drink teas under the New Leaf(R) brand. The Company reported a net loss of $9.13 million on $4.25 million of net sales for the year ended Dec. 31, 2010, compared with a net loss of $10.93 million on $3.45 million of net sales for the same period during the prior year. As reported by the TCR on June 2, 2011, Mayer Hoffman McCann P.C., in Phoenix, Arizona, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations, has a working capital deficiency, was not in compliance with certain financial covenants related to debt agreements, and has a significant amount of debt maturing in 2010. Mayer Hoffman issued negative going concern qualifications following the release of the 2009 and 2010 results. NEXTMART INC: AuKeSaSi Beijing Acquires 100% of BGCC ---------------------------------------------------- NextMart Inc., on July 20, 2011, entered into an acquisition transaction wherein its subsidiary AuKeSaSi (Beijing) Art Market Consulting Company acquired 100% of Beijing Gaolaiqi Culture Communications Co. Ltd. which has RMB 3 million in registered capital in exchange for 368,941,292 shares of the Company at a price of US$0.00125 per share. BGCC was 52% held by Ms. Zhu Yun and 48% held by Liaoning Chengde Trading Co. Ltd. Of the 368,941,292 Company shares, 191,849,472 will be transferred to Ms. Zhu Yun and 177,091,820 will be transferred to LCT totaling 100% of BGCC and its registered capital. The Company assumed the control of BGCC and its capital immediately upon the transaction. About NextMart Inc. Beijing, PRC-based NextMart, Inc., was originally incorporated under the laws of Minnesota in 1972 and was previously known as SE Global Equity. In May 2007, the Company reincorporated into the State of Delaware and changed its name to NextMart, Inc. NextMart's planned business operations for 2011 will consist of 1) the sale of marketing solutions through art events and art media marketing channels, and 2) the design and marketing of art-themed products lines for existing luxury and high-end goods and services, and art themed real estate developments. The Company's balance sheet at June 30, 2011, showed $1.39 million in total assets, $3.16 million in total liabilities, and a $1.77 million total stockholders' deficit. As reported in the Troubled Company Reporter on Jan. 19, 2011, Bernstein & Pinchuk LLP, in New York, expressed substantial doubt about NextMart, Inc.'s ability to continue as a going concern, following the Company's results for the fiscal year ended Sept. 30, 2010. The independent auditors noted that the Company has incurred significant losses from operations for the two years ended Sept. 30, 2010, and has a working capital deficiency. Bankruptcy Warning The Company said it cannot provide assurances that it will be successful in its efforts to enhance its liquidity. If the Company is unable to raise sufficient funds to meet its cash requirements, it may be required to curtail, suspend, or discontinue its current or proposed operations. The Company's inability to raise additional funds may forced the Company to restructure, file for bankruptcy, sell assets or cease operations, any of which could adversely impact its business and business strategy, and the value of its capital stock. Due to the current price of the Company's common stock, any common stock based financing will create significant dilution to the then existing stockholders. In addition, in order to conserve capital and to provide incentives for the Company's employees and service providers, it is conceivable that the Company may issue stock for services in the future which also may create significant dilution to existing stockholders. NORTHCORE TECHNOLOGIES: Renews Contract of Enterprise Client ------------------------------------------------------------ Northcore Technologies Inc. announced the contract renewal of a strategic client. The client is an industry leader in food and beverage production and distribution and has been a long term user of the Northcore asset management toolset. Northcore provides a comprehensive platform for the management of capital equipment assets through the entire lifecycle, from sourcing through to tracking and ultimately disposition. The products are proven, effective and in use by some of the world?s most successful corporations. "We are gratified by this latest contract renewal and the corresponding vote of confidence from one of our key clients," said Amit Monga, CEO of Northcore Technologies. "We believe that this demonstrates the strength of our partner relationships and the real benefits of our Asset Management platform." Companies interested in effective asset management solutions should contact Northcore at 416-640-0400 or 1-888-287-7467, extension 395 or via e-mail at Sales@northcore.com About Northcore Toronto, Ontario-based Northcore Technologies Inc. (TSX: NTI; OTC BB: NTLNF) -- http://www.northcore.com/-- provides a Working Capital Engine(TM) that helps organizations source, manage, appraise and sell their capital equipment. Northcore offers its software solutions and support services to a growing number of customers in a variety of sectors including financial services, manufacturing, oil and gas and government. Northcore owns 50% of GE Asset Manager, LLC, a joint business venture with GE. Together, the companies work with leading organizations around the world to help them liberate more capital value from their assets. Northcore reported a net loss for the first quarter of C$574,000. This compares with a net loss of C$677,000 in the fourth quarter of 2010. In the first quarter of 2010, Northcore reported a net loss of $713,000. Northcore reported consolidated revenues of C$183,000 for the first quarter, an increase of 4% over the C$176,000 reported in the fourth quarter of 2010. In the same period of 2010, Northcore reported consolidated revenues of C$150,000. Certain adverse conditions and events cast substantial doubt upon the ability of the Company to continue as a going concern, the Company said in the filing. "The Company has not yet realized profitable operations and has relied on non-operational sources of financing to fund operations." The Company's balance sheet at June 30, 2011, showed C$1.39 million in total assets, C$1.33 million in total liabilities and C$61,000 in total shareholders' equity. OKLAHOMA FARM: A.M. Best Cuts Financial Strength Rating to 'B-' --------------------------------------------------------------- A.M. Best Co. has downgraded the financial strength rating to B- (Fair) from B (Fair) and issuer credit ratings to "bb-" from "bb" of Oklahoma Farm Bureau Group (Oklahoma Farm Bureau) and its members, Oklahoma Farm Bureau Mutual Insurance Company and AgSecurity Insurance Company (all domiciled in Oklahoma City, OK). The outlook for all ratings is negative. The rating downgrades reflect Oklahoma Farm Bureau's declining surplus trend as a result of its poor underwriting performance, which has continued into 2011. Oklahoma Farm Bureau has experienced significant underwriting losses over the past five years, with a five-year average combined ratio that is significantly worse than its personal lines composite. Although the company has increased rates, reduced exposure and implemented loss control initiatives, frequent and severe catastrophe events have resulted in continued underwriting losses. In addition, Oklahoma Farm Bureau bolstered its surplus through an approximate $25 million surplus note in 2010; however, severe storms early in the third quarter of 2010 and the second quarter of 2011 eroded much of this capital. Oklahoma Farm Bureau continues to improve its risk management strategies. In addition, the company maintains a favorable expense structure and benefits from its affiliation with The Oklahoma Farm Bureau Federation. OPEN RANGE: Files for Chapter 11 to Sell or Liquidate ----------------------------------------------------- Open Range Communications Inc., a provider of wireless broadband services to 26,000 rural customers in 12 states, filed a Chapter 11 petition Oct. 6 (Bankr. D. Del. Case No. 11-13188), saying it would either sell the business or shut down and liquidate. Open Range disclosed assets of $114 million and liabilities of $110 million as of Sept. 30, 2011. Secured debt includes $74 million owing to the U.S. Agriculture Department's Rural Utilities Services. Unsecured claims are $36 million. The business has been funded partly with $41 million in equity contributions from One Equity Partners LLC. Open Range, based in Greenwood Village, Colorado, blamed financial problems on substandard equipment provided by a vendor and difficulties in maintaining licenses for wireless spectrum required for the system. GlobalStar Licensee LLC provided the licensed spectrum that Open Range intended to use to reach up to 50 million people. Chris Edwards, CFO, said in a court filing that by June 30, 2010, the Debtor was in 36 markets and passed 220,000 households. But, according to Mr. Edwards, the momentum was substantially adversely affected by difficulties GlobalStar was having retaining the spectrum which the company was using for its services. The Company, Mr. Edwards added, experienced problems in network quality which further slowed down progress compared to its original plans. The wireless network the Company uses was built and maintained under turn-key arrangement with Alvarion. But the system performance contracted from Alvarion was never achieved. The Company had revenue of $1.74 million and a loss from operations of $50.3 million in fiscal year ended Dec. 31, 2010. Open Range said it filed for bankruptcy to utilize the benefits of the automatic stay and other Bankruptcy Code protections to effectuate either (i) an 11 U.S.C. Sec. 363 sale of substantially all of its assets as a going concern or sales for select assets, or (ii) a wind-down of its business through a liquidation in Chapter 11. During the first 30 days of the Chapter 11 case, the Company will market its assets to determine whether there are any potential bidders for the sale. If the sale process is unsuccessful, the Company will immediately shut down its network and begin a wind- down of its operations. The Company estimates that it will take three months to complete a wind-down. The Company selected Cole, Schotz, Meisel, Forman & Leonard, P.A., as its bankruptcy counsel. The Company tapped FTI Consulting Inc. to provide certain employees for financial crisis, turnaround and related management services including Michael E. Katzenstein to serve as the Company's chief restructuring officer, and Christopher R. LeWand as the Company's associated chief restructuring officer. In addition, the Company selected Logan & Company Inc. as claims, noticing, and balloting agent. According to Greg Avery at Denver Business Journal, one before the bankruptcy filing, the Company laid off 126 of its 174 employees. Founder and CEO Bill Beans also resigned on Oct. 5. The Business Journal relates that in April, the U.S. Agriculture Department's Rural Utilities Services and One Equity Partners restructured their funding commitments to Open Range, reducing the RUS loan amount 32%, to $180 million, and the OEP agreeing to a $40 million investment. That was shortly after Open Range had reached an agreement with Light Squared, a Reston, Va.-based broadband spectrum wholesaler, to use LightSquared's frequencies to carry Open Range's broadband service, says Mr. Avery. The Business Journal also relates that RUS on Oct. 4 asked Open Range to pay back $19.6 million that the government agency said had been "improperly forwarded" to the company, said Mr. Avery citing papers filed with the Court. Open Range started its WiMax broadband and voice service in late 2009, backed by a $267 million loan from RUS and $100 million invested by OEP, a financing arm of JPMorgan Chase & Co. Dow Jones' DBR Small Cap reports that Open Range, which was slated to partner with wireless company LightSquared to provide broadband Internet service to rural areas, sought Chapter 11 protection after its government loan funding was cut off. OPEN RANGE: Case Summary & 30 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Open Range Communications Inc. 6430 S. Fiddlers Green Circle, Suite 500 Greenwood Village, CO 80111 Bankruptcy Case No.: 11-13188 Chapter 11 Petition Date: October 6, 2011 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Judge: Kevin J. Carey Debtor's Counsel: Marion M. Quirk, Esq. COLE, SCHOTZ, MEISEL, FORMAN & LEONARD 500 Delaware Avenue, Suite 1410 Wilmington, DE 19801 Tel: (302) 652-3131 Fax: (302) 652-3117 E-mail: bankruptcy@coleschotz.com Debtor's Claims Agent: LOGAN & CO. Estimated Assets: $100,000,001 to $500,000,000 Estimated Debts: $100,000,001 to $500,000,000 The petition was signed by Chris Edwards, chief financial officer. Debtor's List of Its 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Adesta, LLC Trade Payable $7,574,352 1200 Landmark Center, Suite 1300 Omaha, NE 68102 Velocitel, Inc. Trade Payable $5,590,037 2000 Regency Parkway, Suite 135 Cary, NC 27518 One Equity Partners JPM Chase OEP Management Fee $2,787,810 320 Park Avenue, 18th Floor New York, NY 10022 Alvarion Inc. Trade Payable $1,960,150 2495 Leghorn Streey Mountain View, CA 94043 Black Dot Wireless, LLC Trade Payable $742,316 320 Commerce, Suite 200 Irvine, CA 92602 Globalstar Trade Payable $735,827 4170 Ashford Dunwoody Road, Suite 250 Atlanta, GA 30319 Cloud 10 Corporation Trade Payable $649,860 6786 S. Revere Parkway, Suite 100 Centennial, CO 80112 Communications Test Design, Inc. Trade Payable $633,898 1373 Enterprise Drive West Chester, PA 19380 Rt & Sons LLC Trade Payable $441,003 100 2nd Street E. Whitefish, MT 59937 Aerios Direct Inc. Services $417,764 720 Corporate Circle, Suite D Golden, CO 80401 Level 3 Communications LLC Services $393,549 1025 Eldorado Boulevard Broomfield, CO 80021 Drinker Biddle & Reath LLP Legal Services $370,490 1500 K. Street, N.W., Suite 1100 Washington, D.C. 20005-1209 Netlink Software Group America Services $347,143 Inc. 1701 E. Woodfield Road, Suite 430 Schaumberg, IL 60173 AT&T Services $344,536 AT&T Mobility 12555 Cingular Way, Suite 1200 Alpharetta, GA 30004 Latham & Watkins LLP Legal Services $335,000 885 Third Avenue New York, NY 10022-4834 CallComm Construction, Inc./AirTel Trade Payable $294,543 5721 Logan Street Denver, CO 80216 Statera Inc. Services $280,040 6501 E. Belleview Avenue, Suite 300 Englewood, CO 80111 BCI Communications Inc. Trade Payable $260,462 18-01 Pollitt Drive Fair Law, NJ 07410 Frontera Consulting LLC Services $251,849 120 Riverside Boulevard, Suite 14T New York, NY 10069 Aviat US Inc. Services $195,069 Alianza Global Communication Services $185,431 Service SiteMaster, Inc. Trade Payable $175,061 Zayo Bandwidth, LLC Services $161,040 PVSL Solutions Inc. Services $128,515 American Tower Lease Obligation $124,313 CCGS Holdings LLC Lease Obligation $115,196 SBA Structures, Inc. Lease Obligation $112,623 Pinpoint Staffing, LLC Services $103,764 Kentucky Data Link, Inc. Services $96,684 Nexgen Wireless Inc. Services $96,382 OPTIMUMBANK HOLDINGS: Issuance of 37.5MM Common Shares Approved --------------------------------------------------------------- OptimumBank Holdings, Inc., on Sept. 28, 2011, held a special meeting of shareholders. At the Special Meeting, the shareholders: (1) voted to approve the issuance of up to 37,500,000 shares of the Company's common stock in a proposed private placement; (2) voted to approve an amendment to the Company's articles of incorporation to increase the authorized shares of common stock from 1,500,000 shares to 50,000,000 shares; and (3) voted to adjourn the Special Meeting, if necessary. On Sept. 29, 2011, the Company filed with the Secretary of State of Florida an Amendment to its Articles of Incorporation increasing the number of authorized shares of common stock from 1,500,000 shares to 50,000,000 shares. A copy of the Amendment is available for free at http://is.gd/SyDkYn About OptimumBank Holdings Fort Lauderdale, Fla.-based OptimumBank Holdings, Inc. is a is a one-bank holding company and owns 100% of OptimumBank, a state (Florida)-chartered commercial bank. The Bank offers a variety of community banking services to individual and corporate customers through its three banking offices located in Broward County, Florida. The Bank's wholly-owned subsidiaries are OB Real Estate Management, LLC, OB Real Estate Holdings, LLC, OB Real Estate Holdings 1503, LLC, and OB Real Estate Holdings 1695, LLC, all of which were formed in 2009. OB Real Estate Management, LLC, is primarily engaged in managing foreclosed real estate. OB Real Estate Holdings, LLC, OB Real Estate Holdings 1503, LLC, and OB Real Estate Holdings 1695, LLC, hold and dispose of foreclosed real estate. OptimumBank is currently operating under a Consent Order issued by the Federal Deposit Insurance Corporation ("FDIC") and the State of Florida Office of Financial ("OFR"), effective as of April 16, 2010. As of Sept. 30, 2010, the Bank was considered "undercapitalized" under these FDIC requirements. As an "undercapitalized" institution, the Bank is subject to restrictions on capital distributions, payment of management fees, asset growth and the acceptance, renewal or rollover of brokered and high-rate deposits. In addition, the Bank must obtain prior approval of the FDIC prior to acquiring any interest in any company or insured depository institution, establishing or acquiring any additional branch office, or engaging in any new line of business. "The Bank [OptimumBank] has experienced recent and continuing increases in nonperforming assets, declining net interest margin, increases in provisions for loan losses, continuing high levels of noninterest expenses related to the credit problems, and eroding regulatory capital which raise substantial doubt about the Bank's ability to continue as a going concern," the Company said in its Form 10-Q for the quarter ended Sept. 30, 2010. The Company's balance sheet at June 30, 2011, showed $176.15 million in total assets, $177.32 million in total liabilities, and a $1.16 million total stockholders' deficit. The Company reported a net loss of $8.45 million on $8.78 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $11.48 million on $14.00 million of total interest income during the prior year. The Company's continuing high levels of nonperforming assets, declining net interest margin, continuing high levels of noninterest expenses related to the credit problems, and eroding regulatory capital raise substantial doubt about the Company's ability to continue as a going concern. Moreover, as reported by the TCR on April 20, 2011, Hacker, Johnson & Smith PA, in Fort Lauderdale, Florida, noted that the Company's operating and capital requirements, along with recurring losses raise substantial doubt about its ability to continue as a going concern. ORAGENICS INC: Committee Awards Options to Buy 195,700 Shares ------------------------------------------------------------- The Compensation Committee of Oragenics, Inc.'s Board of Directors, which administers the Company's Amended and Restated 2002 Stock Option and Incentive Plan, awarded options to acquire an aggregate of 195,700 shares of common stock to employees of the Company including the Company's President and Chief Executive Officer, Dr. John Bonfiglio and the Company's Chief Financial Officer, Mr. Brian Bohunicky. The Compensation Committee awards under the Plan were made consistent with the Compensation Committee's objective to continue to retain and motivate Company employees. The awards included grants to (i) Dr. Bonfiglio of options to acquire 39,200 shares of Company common stock and (ii) Mr. Bohunicky, of options to acquire and aggregate of 28,000 shares of Company common stock. These option awards each have exercise prices of $1.50 per share, which was the closing price on the date the Compensation Committee granted the options. The options awarded to Dr. Bonfiglio and Mr. Bohunicky time vest in equal amount on an annual basis over three years, subject to earlier vesting upon a change in control of the Company. The awards made to the other employees also have an exercise price of $1.50 some of which are time vested and some of which consist of both time vested awards and awards in which, the vesting is tied to certain designated performance milestones. These option awards were made pursuant to individual award agreements substantially similar to the form of Stock Option Agreement attached as an exhibit to the Company's Plan which has been previously filed with the SEC. About Oragenics Inc. Tampa, Fla.-based Oragenics, Inc. -- http://www.oragenics.com/-- is a biopharmaceutical company focused primarily on oral health products and novel antibiotics. Within oral health, Oragenics is developing its pharmaceutical product candidate, SMaRT Replacement Therapy, and also commercializing its oral probiotic product, ProBiora3. Within antibiotics, Oragenics is developing a pharmaceutical candidate, MU1140-S and intends to use its patented, novel organic chemistry platform to create additional antibiotics for therapeutic use. The Company's balance sheet at June 30, 2011, showed $1.3 million in total assets, $6.3 million in total liabilities, and a stockholders' deficit of $5.0 million. As reported in the TCR on April 5, 2011, Kirkland, Russ, Murphy & Tapp, P.A., in Clearwater, Fla., expressed substantial doubt about Oragenics' ability to continue as a going concern, following the Company 2010 results. The independent auditors noted that the Company has incurred recurring operating losses, negative operating cash flows and has an accumulated deficit. OTERO COUNTY: Court Approves John D. Wheeler as Bankruptcy Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of New Mexico authorized Otero County Hospital Association, Inc., to employ John D. Wheeler & Associates, PC as counsel. As reported in the Troubled Company Reporter on Sept. 7, 2011, the firm's professionals and their hourly rates are: Partner $200 Of Counsel $200 Associates $175 Paraprofessionals $75 The Court also authorized the Debtor to pay 75% of invoiced fees, 100% of reimbursable costs, and 100% of applicable gross receipts tax on fees and taxes that are paid to JDWA on a monthly basis, upon receipt of JDWA's billing statements prior to the Court's ultimate approval of JDWA's compensation. The payments are to be made first, from a prepetition retainer held in JDWA's trust account, if any, and when the retainer is fully expended, thereafter from other funds of the estate. The Debtor may pay JDWA interim compensation at its standard hourly rates. The Debtor assured the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Otero County Hospital Otero County Hospital Association Inc. filed for Chapter 11 protection (Bankr. D. N.M. Case No. 11-13686) in Albuquerque, New Mexico, on Aug. 16, 2011. The Alamogordo, New Mexico-based nonprofit developed and operates the Gerald Champion Regional Medical Center. GCRMC serves a total population of approximately 70,000 people. The Debtor disclosed $124,186,104 in assets and $40,506,759 in liabilities as of the Chapter 11 filing. Otero County Hospital Association also does business as Mountain View Catering. Judge Robert H. Jacobvitz presides over the case. Craig H. Averch, Esq., and Roberto J. Kampfner, Esq., at White & Case, LLP, in Los Angeles; and John D. Wheeler, Esq., at John D. Wheeler & Associates, PC, in Alamogordo, New Mexico, serve as bankruptcy counsel. Kurtzman Carson Consultants, LLC, serves as claims agent. Alice Nystel Page, United States Trustee for Region 20 appointed five unsecured creditors to serve on the Official Committee of Unsecured Creditors of the Debtor. OTERO COUNTY: Bankruptcy Court OKs White & Case as Lead Counsel --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of New Mexico authorized Otero County Hospital Association, Inc., to employ White & Case LLP as lead counsel. As reported in the Troubled Company Reporter on Sept. 6, 2011, W&C is representing the Debtor in coordination with John D. Wheeler & Associates, PC, a new Mexico law firm. As lead counsel, W&C is expected to, among others: a. represent and render legal advice to the Debtor regarding all aspects of this bankruptcy case, including, without limitation, the continued operation of Debtor's businesses, meetings of creditors, claims objections, adversary proceedings, plan confirmation and all hearings before the Bankruptcy Court; b. take all necessary actions to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections to claims filed against the Debtor's estate; and c. provide legal advice with respect to the Debtor's powers and duties as debtor in possession in the continued operation of its businesses; The Debtor will pay W&C its customary hourly rates for services rendered that are in effect at the time the services were performed. The Debtor is also authorized to pay 75% of invoiced fees and 100% of reimbursable costs to W&C on a monthly basis, upon receipt of W&C's billing statements prior to the Court's ultimate approval of W&C?s compensation. The payments are to be made first, from a pre-petition retainer held in W&C's trust account, if any, and when the retainer is fully expended, thereafter from other funds of the estate. The Debtor may pay W&C interim compensation at its standard hourly rates. Craig H. Averch, a partner of W&C assured the Court that W&C is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Otero County Hospital Otero County Hospital Association Inc. filed for Chapter 11 protection (Bankr. D. N.M. Case No. 11-13686) in Albuquerque, New Mexico, on Aug. 16, 2011. The Alamogordo, New Mexico-based nonprofit developed and operates the Gerald Champion Regional Medical Center. GCRMC serves a total population of approximately 70,000 people. The Debtor disclosed $124,186,104 in assets and $40,506,759 in liabilities as of the Chapter 11 filing. Otero County Hospital Association also does business as Mountain View Catering. Judge Robert H. Jacobvitz presides over the case. Craig H. Averch, Esq., and Roberto J. Kampfner, Esq., at White & Case, LLP, in Los Angeles; and John D. Wheeler, Esq., at John D. Wheeler & Associates, PC, in Alamogordo, New Mexico, serve as bankruptcy counsel. Kurtzman Carson Consultants, LLC, serves as claims agent. Alice Nystel Page, United States Trustee for Region 20 appointed five unsecured creditors to serve on the Official Committee of Unsecured Creditors of the Debtor. PARTNERS MUTUAL: A.M. BEST Downgrades FSR to 'C++' -------------------------------------------------- A.M. Best Co. has downgraded the financial strength rating to C++ (Marginal) from B (Fair) and issuer credit rating to "b" from "bb" of Partners Mutual Insurance Company (Partners) (Waukesha, WI). The outlook for both ratings has been revised to negative from stable. These rating actions reflect Partners' decline in its risk- adjusted capitalization as a result of the company reporting a loss to policyholder surplus of approximately 40% as of the second quarter of 2011, due to significant weather-related losses. The ratings also recognize Partners' trend of deteriorating underwriting performance, an elevated expense structure and geographic concentration of risks. Offsetting these negative rating factors are Partners' long- standing agency relationships and strategies to improve underwriting results. PAT IONADI: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Pat Ionadi Corporation dba Ionadi Corporation 4615 Butler Street Pittsburgh, PA 15201 Bankruptcy Case No.: 11-26204 Chapter 11 Petition Date: October 5, 2011 Court: U.S. Bankruptcy Court Western District of Pennsylvania (Pittsburgh) Debtor's Counsel: Adam S. Barsotti, Esq. BARSOTTI LAW OFFICE 8601 Old Perry Highway Pittsburgh, PA 15237 Tel: (412) 369-5710 Fax: (412) 369-5715 E-mail: barsottilaw@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company?s list of its 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/pawb11-26204.pdf The petition was signed by Patrick Ionadi, president. PENINSULA HOSPITAL: Court Names McMurray as Patient Care Ombudsman ------------------------------------------------------------------ The Hon. Elizabeth S. Stong of the U.S. Bankruptcy Court for the Eastern District of New York appointed Daniel T. McMurray at Focus Management Group as patient care ombudsman in the bankruptcy case of Peninsula Hospital Center, at the behest of Tracy Hope Davis, United States Trustee for Region 2. The Patient Care Ombudsman will: 1) monitor the quality of patient care provided to patients of the debtor, to the extent necessary under the circumstances, including interviewing patients and physicians; 2) not later than 60 days after the date of appointment, and not less frequently than at 60 day intervals thereafter, report to the court after notice to the parties in interest, at a hearing or in writing, regarding the quality of patient care provided to patients of the debtor; and 3) if such ombudsman determines that the quality of patient care provided to patients of the debtor is declining significantly or is otherwise being materially compromised, file with the court a motion or written report, with notice to the parties in interest immediately upon making such determination. Mr. McMurray is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Mr. McMurray can be reached at: Daniel T. McMurray Focus Management Group 5011 W. Lemon Street Tampa, Florida 33609 Tel: (813) 281-0062 Fax: (813) 281-0063 E-mail: d.mcmurray@focusmg.com 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. On the Net: http://www.peninsulahospital.org/ PENN NATIONAL: S&P Raises Rating on Subordinated Debt to 'BB' ------------------------------------------------------------- Standard & Poor's Ratings Services raised its issue-level ratings on Wyomissing, Penn.-based Penn National Gaming Inc.'s subordinated debt to 'BB' (at the same level as the corporate credit rating) from 'BB-' and removed the ratings from CreditWatch, where they were placed with developing implications on June 7, 2011. The recovery rating remains unchanged at '4', indicating our expectation of average (30% to 50%) recovery for lenders in the event of a default. "We subsequently withdrew our issue-level rating on the company's $250 million 6.75% senior subordinated notes due 2015," S&P related. Penn National called for redemption of the notes and funded the redemption with proceeds from its new revolving credit facility. The CreditWatch listing of the subordinated notes issues reflected uncertainty over how the company would fund the redemption of the 6.75% senior subordinated notes, which would potentially have included increasing the size of the term loan B and could have resulted in a revision of our recovery rating on Penn's subordinated debt. Ratings List Penn National Gaming Inc. Corporate Credit Rating BB/Stable/-- Upgraded; Recovery Rating Unchanged To From Penn National Gaming Inc. Subordinated BB BB-/Watch Dev Recovery Rating 4 4 Ratings Subsequently Withdrawn To From Penn National Gaming Inc. Senior Subordinated nts $250 mil nts NR BB Recovery Rating NR 4 PHILADELPHIA ORCHESTRA: Nears to Reaching Deal With Labor --------------------------------------------------------- Peter Dobrin, The Philadelphia Inquirer's classical music critic, reports that a breakthrough in the Philadelphia Orchestra's Chapter 11 bankruptcy case could emerge as soon as Wednesday, as management and labor try to hammer out a deal under the supervision of Stephen Raslavich, chief judge of U.S. Bankruptcy Court, Eastern District of Pennsylvania. According to Mr. Dobrin, if a new contract does not include continued participation in the national musicians' pension fund, the fund will begin litigation involving donors and board members. Sources told the Inquirer that musicians had not received a final offer from management as of Tuesday. Judge Raslavich asked the musicians' union not to discuss a developing deal on wages and pension with players, who returned from vacation Tuesday for the start of the orchestra's 2011-12 season. Judge Raslavich does not have the authority to dictate the terms of a new contract. But he has impressed upon both sides that if a deal was not reached through court-supervised negotiations, a long stretch of expensive and unpleasant litigation lay ahead. The report says it was still not clear whether, under the terms of a contract that may be coming together, the American Federation of Musicians and Employers' Pension Fund would continue to serve as the retirement plan for musicians. If it is not, fund leaders say they will pursue litigation to recover what they say is between $23 million and $35 million the fund would be owed as part of a withdrawal liability. The report relates that, If the pension fund is cut out, he said, "we have to mitigate that withdrawal liability, and we'll look to the endowment to see if there are funds to help mitigate that." In fact, the pension fund is already far along on its investigation of the endowment. In a teleconference with the court Tuesday, the fund revealed that it had sent letters to 18 to 20 donors, asking whether they spelled out that their donations be earmarked as restricted to remain in endowment for perpetuity, says Mr. Dobin. The report notes attorney Herman "Hank" L. Goldsmith told Judge Eric L. Frank that the strategy was proving "fruitful." Mr. Dobrin says one donor who made a $2 million donation, Goldsmith said, had already responded that he made an "unrestricted gift, and the [Orchestra Association] kept writing back to say thank you for your restricted gift." Mr. Dobrin adds that the orchestra contends that all $120 million or so of its endowment is restricted by donors' wishes to remain in the endowment, and is therefore unavailable to creditors as part of the bankruptcy. The legal theory under which the pension fund is operating is that perhaps up to $20 million in endowment gifts came with no clear instructions for their use and that the fund, as the largest creditor in the case, is entitled to the money as part of the bankruptcy process. The report relates that Anne M. Aaronson, Esq., the association's bankruptcy attorney, said she learned only Monday that donors were being contacted. She expressed concern that they were being pulled into the case and suggested that this course of action was "harassment or a vindictive act against the" association. About The Philadelphia Orchestra The Philadelphia Orchestra -- http://www.philorch.org/-- claims to be among the world's leading orchestras. Bloomberg News says the orchestra became the first major U.S. symphony to file for bankruptcy protection, surprising the music world. Previous conductors include Fritz Scheel (1900-07), Carl Pohlig (1907-12), Leopold Stokowski (1912-41), Eugene Ormandy (1936-80), Riccardo Muti (1980-92), Wolfgang Sawallisch (1993-2003), and Christoph Eschenbach (2003-08). Charles Dutoit is currently chief conductor, and Yannick Nezet-Seguin has assumed the title of music director designate until he takes up the baton as The Philadelphia Orchestra's next music director in 2012. The Philadelphia Orchestra Association, The Academy of Music of Philadelphia, Inc., and Encore Series, Inc., filed separate Chapter 11 petitions (Bankr. E.D. Pa. Case Nos. 11-13098 to 11-13100) on April 16, 2011. Judge Eric L. Frank presides over the case. The Philadelphia Orchestra Association is being advised by Dilworth Paxson LLP, its legal counsel, and Alvarez & Marsal, its financial advisor. Curley, Hessinger & Johnsrud serves as its special counsel. Philadelphia Orchestra disclosed $15,950,020 in assets and $704,033 in liabilities as of the Chapter 11 filing. Encore Series, Inc., tapped EisnerAmper LLP as accountants and financial advisors. Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed seven members to the official committee of unsecured creditors in the Debtors' case. Reed Smith LLP serves as the Committee's counsel. PILGRIM'S PRIDE: Manipulated Chicken Prices, Ordered to Pay $26MM ----------------------------------------------------------------- Dow Jones' Daily Bankruptcy Review reports that a federal judge ruled Pilgrim's Pride Corp. knowingly tried to manipulate the price of chicken in 2009 and ordered the company to pay $26 million in damages to dozens of contract poultry growers in Arkansas. About Pilgrim's Pride Pilgrim's Pride Corporation -- http://www.pilgrimspride.com/-- is one of the largest chicken companies in the United States, Mexico and Puerto Rico. The Company's fresh chicken retail line is sold throughout the US, throughout Puerto Rico, and in the northern and central regions of Mexico. The Company exports commodity chicken products to 90 countries. The Company operates feed mills, hatcheries, processing plants and distribution centers in 15 U.S. states, Puerto Rico and Mexico. Pilgrim's Pride and six of its subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Lead Case No. 08-45664) on Dec. 1, 2008. The Company's subsidiaries in Mexico and certain subsidiaries in the United States were not included in the filing and operated outside of the Chapter 11 process. Attorneys at Weil, Gotshal & Manges LLP served as bankruptcy counsel. Lazard Freres & Co., LLC, was the Company's investment bankers. Kurtzman Carson Consulting LLC served as claims and notice agent. Kelly Hart and Brown Rudnick represented the official equity committee. Attorneys at Andrews Kurth LLP represented the official committee of unsecured creditors. On Dec. 10, 2009, the Bankruptcy Court confirmed the Joint Plan of Reorganization filed by the Debtors. The Plan was premised on the sale of the business to JBS SA. Under the Plan, creditors are paid in full. Existing owners retained 34% of the equity. The Company emerged from its Chapter 11 bankruptcy proceedings on Dec. 28, 2009. * * * According to the Troubled Company Reporter on July 5, 2011, Moody's Investors Service downgraded Pilgrim's Pride's Corporate Family and Probability of Default ratings to B2 from B1 and senior unsecured note rating to Caa1 from B3 given the lack of improvement in chicken prices and its consequent impact on Pilgrim's Pride's financial performance, including expectations for modest EBITDA at best for 2011. Moody's concern is somewhat mitigated by the covenant relief provided by Pilgrim's lenders and the cash advance of $50 million from JBS USA (a PIK subordinated loan provided by a sister company). The SGL-3 speculative grade liquidity rating was affirmed. The outlook is stable. PITT PENN: Thomas Alexander Gets OK to Withdraw as Special Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware granted the request of Thomas Alexander & Forrester LLP to withdraw as special counsel for Pitt Penn Holding Co., Inc. and its Debtor affiliates, including Industrial Enterprises of America, Inc, the named plaintiff in certain adversary proceedings. According to the Troubled Company Reporter on Sept. 28, 2011, the Court approved Thomas Alexander as special counsel to Debtors and is to be compensated on both a reduced hourly basis and on a contingent fee basis on Feb. 16, 2010. The Debtor required that before Thomas Alexander submit a fee application to the Court, the Debtor's management had to approve the fee application. Steven W. Thomas, Esq., a member of Thomas Alexander, contends that despite repeated requests, TEAM has not approved Thomas Alexander's hourly invoices for payments for over three months. Mr. Thomas relates that the original invoice was provided to Industrial Enterprises on May 4, 2011. At Industrial Enterprises' request, Thomas Alexander submitted a revised invoice on June 22, 2011 and since that date, Thomas Alexander has continued to devote significant hours to matters involving Industrial Enterprises. As of August 16, 2011, Thomas Alexander has incurred $408,306 in unpaid legal fees and expenses, Mr. Thomas notes. He adds that Industrial Enterprises continues to withhold payment that is due. Delaware Rule of Professional Conduct 1 .16(b)(5) allows counsel to withdraw for a client's failure to substantially fulfill an obligation to the lawyer regarding the lawyer's services where the client has been given reasonable warning that the lawyer will withdraw unless the obligation is fulfilled. About Industrial Enterprises Pittsburgh, Pennsylvania-based Industrial Enterprises of America, Inc., f/k/a Advanced Bio/Chem, Inc., filed for Chapter 11 protection (Bankr. D. Del. Case No. 09-11508) on May 1, 2009. Pitt Penn Holding Co., Inc., and Pitt Penn Oil Co., LLC, each filed voluntary petitions for Chapter 11 relief (Bankr. D. Del. Case Nos. 09-11475 and 09-11476) on April 30, 2009. EMC Packaging, Inc., filed a voluntary petition for Chapter 11 relief (Bankr. D. Del. Case No. 09-11524) on May 4, 2009. Unifide Industries, LLC, and Today's Way Manufacturing LLC, each filed a voluntary petition for Chapter 11 relief (Bankr. D. Del. Case Nos. 09-11587 and 09-11586) on May 6, 2009. PPH, PPO, EMC, Unifide, and Today's Way are each subsidiaries of IEAM. The cases are jointly administered under Case No. 09-11475. Christopher D. Loizides, Esq., at Loizides, P.A., in Wilmington, Del., represents the Debtors as counsel. In its petition, Industrial Enterprises disclosed total assets of $50,476,697 and total debts of $17,853,997. Industrial Enterprises originally operated as a holding company with four wholly owned subsidiaries, PPH, EMC, Unifide, and Today's Way. PPH, through its wholly owned subsidiary, PPO, was a leading manufacturer, marketer and seller of automotive chemicals and additives. EMC's original business consisted of converting hydrofluorocarbon gases R134a and R152a into branded private label refrigerant and propellant products. Unifide was a leading marketer and seller of automotive chemicals and additives. Today's Way manufactured and packaged the products which were sold by Unifide. PITTSBURGH CORNING: Has Until Oct. 10 to Adjust Plan Language ------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Pennsylvania issued an order regarding the Third Amended Chapter 11 Plan filed by Pittsburgh Corning Corporation, et al. In minutes for the hearing held Sept. 20, 2011, the Court ordered that: -- by Sept. 23, the parties will agree to a schedule as to Mt. McKinley to meet and confer to resolve the insurance neutrality language to satisfy, Mt. McKinley with the proviso that if that happens, then Mt. McKinley will have no further interest in the case and no further objections to the plan. -- by Oct. 10, Reaud will give to the plan proponents language that they think will satisfy the non-derivative claims definition and parties to meet and confer if they need to in order to adjust the plan language; -- soon as any agreement is reached the plan proponents are to notify all constituents as to additional language changes needed to the plan; -- the issue of what has been or has not been resolved is set for a status conference on Nov. 30; and -- 8347 Mt. McKinley Insurance Company's and Everest Reinsurance Company's Motion for Limited Reconsideration, to alter or amend, and for related relief filed on June 30, is continued to Nov. 30 omnibus for status conference. The parties filed an amended and restated stipulation resolving Plan objections, submitted in relation to the Debtor's proposed Plan Amendments dated Sept. 17, 2011, to the Modified Third Amended Plan of Reorganization. The stipulation provides for, among other things: 1. Century Indemnity Company, Pacific Employers Insurance Company and Westchester Fire Insurance Company agree, upon the Funding Effective Date, to sign, and make the scheduled contributions pursuant to, the PPG Trust Funding Agreement as revised by the April 29, 2010 Plan Amendments, the June 8, 2010 Plan Amendments and the Sept. 17, 2011 Plan Amendments, and have been designated as Participating Insurers as set forth in the PPG TFA. 2. The Pre-Stipulation Plan has been amended to include (a) Insurance Company of North America, Indemnity Insurance Company of North America, and CCI Insurance Company, as their successor-in-interest, and Century Indemnity Company, as its successor-in-interest, (b) CIGNA Specialty Insurance, previously known as California Union Insurance Company, and Century Indemnity Company as its successor in interest, (c) International Insurance Company and Westchester Fire Insurance Company, as its successor-in-interest, (d) Lumbermens, and (e) LMI, as Corning Protected Insurers. 3. Upon the occurrence of the Funding Effective Date, Century Indemnity Company agrees to make the payments set forth in the Settlement Agreement (Letter Agreement) between Pittsburgh Corning Corporation and Century Indemnity Company, as successor to Insurance Company of North America and as successor to CIGNA Specialty Insurance (formerly known as California Union Insurance Company), dated May 9, 2002. The Modified Plan The Debtor, Pittsburgh Corning Corporation, the official Committee of Asbestos Creditors, and the Future Claimants' Representative proposed the Modified Third Amended Plan of Reorganization for the Debtor, dated Jan. 29, 2009. The Plan includes injunctions prohibiting actions against certain parties other than the Debtor. The Plan also includes transfers by the Debtor to the Asbestos PI Trust of the Debtor's rights to receive future insurance proceeds, to the extent owing, under settlement agreements executed by the Debtor prior to the Confirmation Date, including the Pre-1981 PCC Settlement Agreements and the PCC Insurance Settlement Agreements. A full-text copy of the Modified Third Amended Plan is available for free at: http://bankrupt.com/misc/PITTSBURGHCORNING_3rdAplan_modified.pdf About Pittsburgh Corning Pittsburgh Corning Corporation filed for Chapter 11 bankruptcy protection (Bankr. W.D. Pa. Case No. 00-22876) on April 16, 2000, to address numerous claims alleging personal injury from exposure to asbestos. At the time of the bankruptcy filing, there were about 11,800 claims pending against the Company in state court lawsuits alleging various theories of liability based on exposure to Pittsburgh Corning's asbestos products and typically requesting monetary damages in excess of $1 million per claim. The Hon. Judith K. Fitzgerald presides over the case. Reed Smith LLP serves as counsel and Deloitte & Touche LLP as accountants to the Debtor. The United States Trustee appointed a Committee of Unsecured Trade Creditors on April 28, 2000. The Bankruptcy Court authorized the retention of Leech, Tishman, Fuscaldo & Lampl, LLC, as counsel to the Committee of Unsecured Trade Creditors, and Pascarella & Wiker, LLP, as financial advisor. The U.S. Trustee also appointed a Committee of Asbestos Creditors on April 28, 2000. The Bankruptcy Court authorized the retention of these professionals by the Committee of Asbestos Creditors: (i) Caplin & Drysdale, Chartered as Committee Counsel; (ii) Campbell & Levine as local counsel; (iii) Anderson Kill & Olick, P.C. as special insurance counsel; (iv) Legal Analysis Systems, Inc., as Asbestos-Related Bodily Injury Consultant; (v) defunct firm, L. Tersigni Consulting, P.C. as financial advisor, and (vi) Professor Elizabeth Warren, as a consultant to Caplin & Drysdale, Chartered. On Feb. 16, 2001, the Court approved the appointment of Lawrence Fitzpatrick as the Future Claimants' Representative. The Bankruptcy Court authorized the retention of Meyer, Unkovic & Scott LLP as his counsel, Young Conaway Stargatt & Taylor, LLP as his special counsel, and Analysis, Research and Planning Corporation as his claims consultant. In 2003, a plan of reorganization was agreed to by various parties-in-interest, but, on Dec. 21, 2006, the Bankruptcy Court issued an order denying the confirmation of that plan, citing that the plan was too broad in addressing independent asbestos claims that were not associated with Pittsburgh Corning. Corning Inc. and PPG each own 50% of the capital stock of Pittsburgh Corning. PORTER DEVELOPMENT: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Porter Development Partners, LLC 13135 Diary Ashford, Suite 150 Sugar Land, TX 77478 Bankruptcy Case No.: 11-38543 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: David R. Jones Debtor's Counsel: Johnie J. Patterson, Esq. WALKER & PATTERSON, P.C. P.O. Box 61301 Houston, TX 77208-1301 Tel: (713) 956-5577 Fax: (713) 956-5570 E-mail: jjp@walkerandpatterson.com Scheduled Assets: $7,999,992 Scheduled Debts: $2,004,250 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Costa Bajjali, vice president and secretary. POINT BLANK: Approved to Auction Business on Oct. 27 ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that on the third attempt, Point Blank Solutions Inc. may succeed in selling the business. The bankruptcy court in Delaware approved sale procedures on Oct. 5. According to the report, bids for the manufacturer of soft body armor for police and military are due Oct. 26, followed by an auction on Oct. 27 and a hearing to approve the sale on Oct. 28. An affiliate of the Gores Group LLC named Barrier Acquisition LLC is under contract to pay $20 million. Secured lenders can bid their debt in lieu of cash, although they must provide $750,000 in cash in addition. Mr. Rochelle relates that Point Blank -- unable to extricate itself from Chapter 11 otherwise -- is selling to overcome opposition from the official equity committee to confirmation of a reorganization plan. About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-11255) on April 14, 2010. Laura Davis Jones, Esq., Alan J. Kornfeld, Esq., David M. Bertenthal, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. T. Scott Avila of CRG Partners Group LLC is the restructuring officer. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. Ian Connor Bifferato, Esq., and Thomas F. Driscoll III, Esq., at Bifferato LLC; and Carmen H. Lonstein, Esq., Andrew P.R. McDermott, Esq., and Lawrence P. Vonckx, Esq., at Baker & McKenzie LLP, serve as counsel for the Official Committee of Equity Security Holders. Robert M. Hirsh, Esq., and George P. Angelich, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at the Rosner Law Group LLC, serve as co counsel. PROTECTIVE LIFE: Fitch Affirms 'BB+' Trust Preferred Rating ----------------------------------------------------------- Fitch Ratings has affirmed Protective Life Corp.'s (NYSE: PL) Issuer Default Rating (IDR) at 'BBB+' and senior debt ratings at 'BBB'. Fitch has also affirmed PL's trust preferred ratings at 'BB+' and primary life insurance subsidiaries' Insurer Financial Strength (IFS) ratings at 'A'. The Rating Outlook is Stable. The rating rationale is that PL's reported credit metrics are consistent with Fitch's expectations. Over the past year, PL has continued to report operating profits in line with expectations, its operating subsidiaries have remained strongly capitalized on a statutory basis, investment impairments have remained well within the levels contemplated by the Fitch investment stress test and PL continues to migrate from reserve-intensive level premium life insurance products to universal life products with lower reserve requirements. Reported risk-adjusted statutory capital rose from yearend 2009 to 2010, but declined modestly in the first half of 2011, which was expected following the close of PL's coinsurance of a book of life business from Liberty Life Insurance Company. Nonetheless, Protective Life Insurance Company's risk based capital ratio remains strong on both a reported basis and when subjected to Fitch's investment stress test. PL's financial leverage ratio has declined, but remains near the high end of the rating expectation of 25% - 30%. Additionally, Fitch notes that under its Total Financings and Commitments ratio (TFC), PL demonstrates high (above average) leverage compared to peers at approximately 1.4 times (x). This is due mainly to financings for Regulation XXX reserving. Fitch generally views these activities as well managed, and related risks were previously captured in Fitch's ratings. Fitch's TFC ratio captures surplus notes and letters of credit used to finance Regulation XXX reserves while traditional financial leverage does not. Fitch also believes that PL's liquidity position is sound. The company has no significant debt maturing until 2013. Also, PL has recently indicated its intention to maintain a cash balance of 12 months interest coverage (approximately $70 million) in cash and liquid assets at the holding company by year-end 2011 and going forward. PL has rapidly grown its variable annuity book of business in 2010 and the first half of 2011. While variable annuities sales grew for the entire industry, PL's growth rate had exceeded the industry's rate of growth. Rapid growth can be a concern in mature product lines because it can signal aggressive pricing or product design. Fitch believes PL's variable annuity products have moderate risk that is mitigated by PL's hedging strategy. Key concerns include a macroeconomic headwind in the form of low interest rates, high financial market volatility and the risk of contagion from the Eurozone debt crisis. These conditions are expected to constrain PL's ability to improve earnings over the near term and could have a material negative effect on the company's earnings and capital in a severe, albeit unexpected, scenario. The key rating triggers that could result in an upgrade include continued recovery in earnings combined with growth in equity and surplus (particularly if accomplished through retained earnings). Ratings could be upgraded if financial leverage remains below 25% and TFC leverage falls into the 0.8x to 1.0x range. Ratings could also be positively affected if EBIT-based interest coverage rose above 9x. The key rating triggers that could result in a downgrade include material declines in GAAP (that would drive financial leverage above 30%) or statutory capital (that would drive reported RBC below 300%), a downturn or weak growth in earnings, or a material reinsurance loss. Ratings could also be pressured if interest coverage fell below 5x. Fitch has affirmed the following ratings with a Stable Rating Outlook: Protective Life Corporation -- IDR at 'BBB+'; -- $250 million in senior notes due 2013 at 'BBB'; -- $150 million in senior notes due 2014 at 'BBB'; -- $150 million in senior notes due 2018 at 'BBB'; -- $400 million of 7.38% senior notes due 2019 at 'BBB'; -- $300 million of 8.45% senior notes due 2039 at 'BBB'; -- $100 million of 8.00% senior retail notes due 2024 at 'BBB'; -- $103 million trust preferred issued through PLC Capital Trust III due 2031 at 'BB+'; -- $119 million trust preferred issued through PLC Capital IV due 2032 at 'BB+'; -- $103 million trust preferred issued through PLC Capital Trust V due 2034 at 'BB+'; -- $200 million class D junior subordinated notes due 2066 at 'BB+'. Protective Life Insurance Company Protective Life and Annuity Insurance Company West Coast Life Insurance Company -- IFS at 'A'. Protective Life Secured Trust -- Notes at 'A'; -- Medium-term notes at 'A'. QUALTEQ INC: Can Employ Fox Rothschild as Co-Counsel ---------------------------------------------------- The Honorable Kevin J. Carey approved the application of QualTeq, Inc., d/b/a VCT New Jersey, Inc., et al. to employ Fox Rothschild LLP as their co-counsel, nunc pro tunc the Petition Date. The Debtor sought to employ Fox Rothschild to provide these services: -- take all necessary actions to protect and preserve the Debtors' bankruptcy estates, including the prosecution or defense of actions on the Debtors' behalf; -- provide legal advice with respect to the Debtors' powers and duties as debtors in possession in the continued operation of their businesses and management of their properties; -- negotiate, prepare and pursue confirmation of a plan and approval of a disclosure statement; and -- assist with any disposition of the Debtors' assets, by sale or otherwise. The Firm will be compensated in accordance with the procedures set forth in Sections 330 and 331 of the Bankruptcy Code, the applicable Bankruptcy Rules, the Local Rules and orders of the Court, and other procedures as have been or may be fixed by Court order. 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. QUANTUM FUEL: Repays May 2011 Bridge Notes in Full -------------------------------------------------- Quantum Fuel Systems Technologies Worldwide, Inc., on Sept. 30, 2011, repaid the entire amount of principal and interest due under bridge notes that the Company issued in May 2011 in accordance with the terms of those bridge notes. About Quantum Fuel Based in Irvine, California, Quantum Fuel Systems Technologies Worldwide, Inc., is a fully integrated alternative energy company and considers itself a leader in the development and production of advanced clean propulsion systems and renewable energy generation systems and services. Quantum Fuel and its senior lender, WB QT, LLC, entered into a Ninth Amendment to Credit Agreement and a Forbearance Agreement on Jan. 3, 2011. The Senior Lender agreed to provide the Company with a $5.0 million non-revolving line of credit, which may be drawn upon at any time prior to April 30, 2011. Advances under the New Line of Credit do not bear interest -- unless an event of default occurs, in which case the interest rate would be 10% per annum -- and mature on April 30, 2011. The Senior Lender also agreed to forbear from accelerating the maturity date for any portion of the Senior Debt Amount and from exercising any of its rights and remedies with respect to the Senior Debt Amount until April 30, 2011. The Company's balance sheet at July 31, 2011, showed $74.15 million in total assets, $31.62 million in total liabilities, and $42.53 million total stockholders' equity. The Company reported a net loss attributable to stockholders of $11.03 million on $20.27 million of total revenue for the year ended Apri1 30, 2011, compared with a net loss attributable to stockholders of $46.29 million on $9.60 million of total revenue during the prior year. Ernst & Young LLP, in Orange County, California, noted that Quantum Fuel's recurring losses and negative cash flows combined with the Company's existing sources of liquidity and other conditions raise substantial doubt about the Company's ability to continue as a going concern. Possible Bankruptcy The Company anticipates that it will need to raise a significant amount of debt or equity capital in the near future in order to repay certain obligations owed to the Company's senior secured lender when they mature. As of June 15, 2011, the total amount owing to the Company's senior secured lender was approximately $15.5 million, which includes approximately $12.5 million of principal and interest due under three convertible promissory notes that are scheduled to mature on Aug. 31, 2011, and a $3.0 million term note that is potentially payable in cash upon demand beginning on Aug. 1, 2011, if the Company's stock is below $10.00 at the time demand for payment is made. If the Company is unable to raise sufficient capital to repay these obligations at maturity and the Company is otherwise unable to extend the maturity dates or refinance these obligations, the Company would be in default. The Company said it cannot provide any assurances that it will be able to raise the necessary amount of capital to repay these obligations or that it will be able to extend the maturity dates or otherwise refinance these obligations. Upon a default, the Company's senior secured lender would have the right to exercise its rights and remedies to collect, which would include foreclosing on the Company's assets. Accordingly, a default would have a material adverse effect on the Company's business and, if the Company's senior secured lender exercises its rights and remedies, the Company would likely be forced to seek bankruptcy protection. QUANTUM FUEL: Sells $1.95 million of 10% Convertible Notes ---------------------------------------------------------- Quantum Fuel Systems Technologies Worldwide, Inc., on Sept. 29, 2011, entered into Subscription Agreements with certain "accredited investors" for the purchase and sale of 10% convertible promissory notes. The Company received gross proceeds of approximately $1.95 million, which will be used for general working capital purposes and repayment of debt. As additional consideration, the Investors received warrants to purchase up to 550,703 shares of the Company's common stock. The holders of the Convertible Notes have the right at any time and from time to time to convert all or part of the outstanding principal amount into shares of the Company's common stock at a conversion price of $2.124 per share. The Convertible Notes mature on the earlier of (i) the first anniversary of the closing date and (ii) the date the Company issues any securities in an offering registered under the Securities Act with the United States Securities and Exchange Commission; provided, however, in the event that the net proceeds received by the Company from such registered offering are insufficient to repay the sum of (A) all of the principal and interest due to the Company's senior secured lender and (B) the amount owed under the Convertible Notes due to the fact that the Company did not have a sufficient number of shares of common stock available for issuance in such registered offering, then the Company shall use its best efforts to obtain stockholder approval for an increase of its authorized shares of common stock and the Maturity Date will be the earlier of (i) one year following the date of issuance of the Convertible Notes and (ii) ninety days following the closing of the registered offering. The exercise price for the Investor Warrants is $2.60 per share. The Investor Warrants are not exercisable for six months and permit cashless exercise unless the resale of the shares underlying the Investor Warrants has been registered under the Securities Act, in which case, they must be exercised for cash. In the event that the Company at any time prior to the first anniversary date of the issuance of the Investor Warrant issues any shares of its common stock or rights, warrants, options or other securities or debt convertible, exercisable or exchangable for shares of the Company's common stock at a price per share that is less than the exercise price for the Investor Warrants then in effect, the exercise price for the Investor Warrant will be adjusted to that lower price. The Company and Investors also entered into a Registration Rights Agreement pursuant to which the Company agreed to file a registration statement within 30 calendar days of the final closing to register the resale of the shares of common stock issuable upon conversion of the Convertible Notes and exercise of the Investor Warrants. The Company also agreed to use its best efforts to cause the registration statement to be declared effective within 60 days of the Required Filing Date. The Company paid its placement agent a cash fee of $233,955 for its services as placement agent in the offering. The Convertible Notes, Investor Warrants, and shares of common stock issuable upon conversion of the Convertible Notes and exercise of the Investor Warrants have not been registered under the Securities Act, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements under the Securities Act or any applicable state securities laws. As a result of the transaction, the anti-dilution provision contained in warrants issued by the Company on Oct. 27, 2006, was triggered. The exercise price for the October 2006 Warrants was reset from $2.92 to $2.124 and the number of shares subject to the October 2006 Warrants was increased from 968,992 to 1,332,135. A full-text copy of the Form 8-K is available for free at: http://is.gd/fs0KYO About Quantum Fuel Based in Irvine, California, Quantum Fuel Systems Technologies Worldwide, Inc., is a fully integrated alternative energy company and considers itself a leader in the development and production of advanced clean propulsion systems and renewable energy generation systems and services. Quantum Fuel and its senior lender, WB QT, LLC, entered into a Ninth Amendment to Credit Agreement and a Forbearance Agreement on Jan. 3, 2011. The Senior Lender agreed to provide the Company with a $5.0 million non-revolving line of credit, which may be drawn upon at any time prior to April 30, 2011. Advances under the New Line of Credit do not bear interest -- unless an event of default occurs, in which case the interest rate would be 10% per annum -- and mature on April 30, 2011. The Senior Lender also agreed to forbear from accelerating the maturity date for any portion of the Senior Debt Amount and from exercising any of its rights and remedies with respect to the Senior Debt Amount until April 30, 2011. The Company's balance sheet at July 31, 2011, showed $74.15 million in total assets, $31.62 million in total liabilities, and $42.53 million total stockholders' equity. The Company reported a net loss attributable to stockholders of $11.03 million on $20.27 million of total revenue for the year ended Apri1 30, 2011, compared with a net loss attributable to stockholders of $46.29 million on $9.60 million of total revenue during the prior year. Ernst & Young LLP, in Orange County, California, noted that Quantum Fuel's recurring losses and negative cash flows combined with the Company's existing sources of liquidity and other conditions raise substantial doubt about the Company's ability to continue as a going concern. Possible Bankruptcy The Company anticipates that it will need to raise a significant amount of debt or equity capital in the near future in order to repay certain obligations owed to the Company's senior secured lender when they mature. As of June 15, 2011, the total amount owing to the Company's senior secured lender was approximately $15.5 million, which includes approximately $12.5 million of principal and interest due under three convertible promissory notes that are scheduled to mature on Aug. 31, 2011, and a $3.0 million term note that is potentially payable in cash upon demand beginning on Aug. 1, 2011, if the Company's stock is below $10.00 at the time demand for payment is made. If the Company is unable to raise sufficient capital to repay these obligations at maturity and the Company is otherwise unable to extend the maturity dates or refinance these obligations, the Company would be in default. The Company said it cannot provide any assurances that it will be able to raise the necessary amount of capital to repay these obligations or that it will be able to extend the maturity dates or otherwise refinance these obligations. Upon a default, the Company's senior secured lender would have the right to exercise its rights and remedies to collect, which would include foreclosing on the Company's assets. Accordingly, a default would have a material adverse effect on the Company's business and, if the Company's senior secured lender exercises its rights and remedies, the Company would likely be forced to seek bankruptcy protection. REAL MEX: S&P Cuts Corp. Credit Rating to D After Ch. 11 Filing --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Cypress, Calif.-based Real Mex Restaurants Inc. to 'D' from 'CC'. "We also lowered our issue-level rating on the company's $130 million secured notes due 2013 to 'D' from 'CC'. The '4' recovery rating on the notes remains unchanged and indicates our expectation for average (30% to 50%) recovery," S&P related. The downgrade of Real Mex follows the company's filing for Chapter 11 bankruptcy protection. "We understand the company will have about $49 million in secured debtor-in-possession financing, which we expect should allow it to maintain operations during the Chapter 11 restructuring. The company had approximately $170 million of debt outstanding at June 26, 2011," S&P said. ROBINO-BAY COURT: Creditor Wants Chapter 11 Case Dismissed ---------------------------------------------------------- Dover Bay Court Plaza asks the U.S. Bankruptcy Court for the District of Delaware to dismiss the Chapter 11 case of Robino-Bay Court Plaza LLC and Robino-Bay Court Pad, LLC. Dover Bay is a holder of the first mortgage secured against Bay Court Plaza's shopping center, all leases and other assets. As of Nov. 10, 2010, payoff of Dover Bay's debt was $11,833,269 with interest accruing at $2,607 per diem. Debtors have made zero payments to Dover Bay since they filed for bankruptcy. Dover Bay tells the Court that the Debtors have failed to file monthly operating reports for May 2011 to present. Dover Bay says the Debtors have not made any payments for the debt service associated with the $11 million owed to Dover Bay. However, Debtors' monthly operating statements list "interest" payments being made during the bankruptcy: August, 2010 $95,914 October, 2010 $61,515 January, 2011 $12,600 Dover Bay adds that the Debtors have not filed a proposed Chapter 11 plan of reorganization nor a proposed disclosure statement. William J. Rhodunda, Esq., at Rhodunda & Williams LLC, represents Dover Bay. About Robino-Bay Court Plaza Wilmington, Delaware-based Robino-Bay Court Plaza, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 10- 12376) on July 28, 2010. The Debtor is represented by John D. McLaughlin, Jr., Esq., at Ciardi Ciardi & Astin. The Debtor estimated its assets and debts at $10 million to $50 million in its Chapter 11 petition. An affiliate, Robino-Bay Court Pad, LLC, filed a separate Chapter 11 petition (Case No. 10-12377) on July 28, 2010, estimating its assets at $500,001 to $1 million and debts at $1 million to $10 million as of the Petition Date. REALOGY CORP: To Report $30 Million Net Loss in Third Quarter ------------------------------------------------------------- Realogy Corporation announced preliminary unaudited results for the third quarter of 2011: * Revenue for the third quarter 2011 was approximately $1.2 billion; * Net loss attributable to Realogy for the third quarter 2011 was approximately $30 million; * EBITDA before restructuring and other items was approximately $185 million for the third quarter 2011; * At Sept. 30, 2011, Realogy's senior secured leverage ratio under its senior secured credit facility is expected to be in the range of approximately 4.10 to 1 ? 4.20 to 1, below the maximum ratio of 4.75 to 1 necessary to be in compliance with the terms of its senior secured credit facility. The Company also expects to be in compliance with that ratio for the foreseeable future; * Realogy's third quarter 2011 homesale transactions increased by 10% year-over-year at the Realogy Franchise Group, the Company's real estate franchise services segment, and by 17% year-over-year at NRT LLC, the Company's owned real estate brokerage unit, compared to the third quarter of 2010; * Realogy's third quarter 2011 average homesale price declined 1% at RFG and 6% at NRT compared to the third quarter of 2010; and * At Sept. 30, 2011, the Company had borrowings of $50 million under its $652 million revolving credit facility and $113 million of outstanding letters of credit drawn against the facility; in October 2011, the Company expects to borrow additional funds under the revolving credit facility to fund interest payments of approximately $215 million due on its Unsecured Notes and Second Lien Loans. EBITDA and EBITDA before restructuring and other items are non- GAAP financial measures. The Company does not currently expect to update the preliminary 2011 third quarter financial information prior to the release of its third quarter 2011 financial results. Realogy expects to release its third quarter 2011 financial results and file its Form 10-Q for the three months ended Sept. 30, 2011, on Nov. 1, 2011, and hold an investor webcast that same day. A full-text copy of the Preliminary Third Quarter Results is available for free at http://is.gd/sheE1w About Realogy Corp. Realogy Corp. -- http://www.realogy.com/-- a global provider of real estate and relocation services with a diversified business model that includes real estate franchising, brokerage, relocation and title services. Realogy's world-renowned brands and business units include Better Homes and Gardens Real Estate, CENTURY 21, Coldwell Banker, Coldwell Banker Commercial, The Corcoran Group, ERA, Sotheby's International Realty, NRT LLC, Cartus and Title Resource Group. Collectively, Realogy's franchise systems have around 15,000 offices and 270,000 sales associates doing business in 92 countries around the world. Headquartered in Parsippany, N.J., Realogy is owned by affiliates of Apollo Management, L.P., a leading private equity and capital markets investor. Realogy fully supports the principles of the Fair Housing Act. The Company's balance sheet at June 30, 2011, showed $7.98 billion in total assets, $9.29 billion in total liabilities, and a $1.31 billion total deficit. * * * Realogy has 'Caa2' corporate family rating and 'Caa3' probability of default rating, with positive outlook, from Moody's. The rating outlook is positive. Moody's said in January 2011 that the 'Caa2' CFR and 'Caa3' PDR reflects very high leverage, negative free cash flow and uncertainty regarding the timing and strength of a recovery of the residential housing market in the U.S. Moody's expects Debt to EBITDA of about 14 times for the 2010 calendar year. Despite the recently completed and proposed improvements to the debt maturity profile, the Caa2 CFR continues to reflect Moody's view that current debt levels are unsustainable and that a substantial reduction in debt levels will be required to stabilize the capital structure. In February, Standard & Poor's Ratings Services raised its corporate credit rating on Realogy Corp. to 'CCC' from 'CC'. The rating outlook is positive. REALTY FINANCE: Board Mulls Chapter 7 Liquidation ------------------------------------------------- In light of the current position Realty Finance Corporation, the Company's board of directors has solicited, evaluated and engaged in discussions with respect to a wide range of strategic alternatives over the past three years. It has investigated each proposal in light of the circumstances surrounding the Company at the time, and will continue to do so in the future. The strategic alternatives that the Board has received and investigated in years prior to 2011 have either been determined not to have been viable, lacked sufficient information or credibility to enable the Board to make informed decisions as to the merits of such alternatives or to proceed with such action or were terminated by the counterparty. While the Board continues to explore various strategic options for the Company, there is no guarantee that any agreement could be reached. In addition, the Company has been evaluating a liquidation of the Company, including filing a Chapter 7 bankruptcy, and may ultimately determine to wind down the affairs of its business and distribute remaining cash, if any, to its stockholders due to, among other things, the Company's inability to complete a strategic transaction, the significant reduction in the value of the Company's platform, the Company's inability to execute its business plan, the Company's inability to obtain new capital, the Company's lack of future sources of cash flow, the Company's operating cash shortfalls, the Company's ability to operate as a going concern, the numerous defaulted investments in the Company's portfolio, the significant reduction of Company personnel and the continuing volatility of real estate and real estate credit markets. The Company continues to focus on controlling operating expenses while effectively managing its investments, including CDO I. Despite the difficult commercial real estate environment and the disappointing financial results, the Company remains committed to maximizing stockholder value. A full text copy of the company's financial statements for the year ended Dec. 31, 2010 is available free at: http://ResearchArchives.com/t/s?7721 About Realty Finance Realty Finance Corporation -- http://www.realtyfinancecorp.com -- is a commercial real estate specialty finance company primarily focused on managing a diversified portfolio of commercial real estate-related loans and securities. RITE AID: Files Form 10-Q, Incurs $92.2MM Loss in Aug. 27 Quarter ----------------------------------------------------------------- Rite Aid Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $92.25 million on $6.27 billion of revenue for the 13 week period ended Aug. 27, 2011, compared with a net loss of $196.97 million on $6.16 billion of revenue for the 13 week period ended Aug. 28, 2010. The Company also reported a net loss of $155.33 million on $12.66 billion of revenue for the 26 weeks period ended Aug. 27, 2011, compared with a net loss of $270.66 million on $12.55 billion of revenue for the 26 weeks period ended Aug. 28, 2010. The Company's balance sheet at Aug. 27, 2011, showed $7.41 billion in total assets, $9.77 billion in total liabilities and a $2.35 billion total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/oLZfg5 About Rite Aid Corp. Drugstore chain Rite Aid Corporation (NYSE: RAD) -- http://www.riteaid.com/-- based in Camp Hill, Pennsylvania, has more than 4,700 stores in 31 states and the District of Columbia and fiscal 2010 annual revenues of $25.7 billion. Rite Aid carries 'Caa2' probability of default and corporate family ratings from Moody's Investors Service. It has a 'B-' corporate credit rating from Standard & Poor's Ratings Services. The TCR reported on Feb. 21, 2011 that Standard & Poor's Ratings Services said that it assigned its 'B+' issue rating and '1' recovery rating to Rite Aid Corp.'s proposed $343 million senior secured term loan tranche 5 due 2018. The '1' recovery rating indicates S&P's expectation for very high (90%-100%) recovery in the event of a payment default. According to the company, it will use the proceeds to repay about $321 million in borrowings under its tranche 3 term loan due 2014. "The ratings reflect the difficulties Rite Aid faces in improving its well-below-average operating performance relative to its peers, especially amid intense industry competition," said Standard & Poor's credit analyst Ana Lai. They also reflect the company's significant debt burden and thin cash flow protection measures. As reported by the Troubled Company Reporter on Feb. 22, 2011, Moody's assigned a B3 rating to Rite Aid Corp.'s proposed $343 million Tranche 5 senior secured first lien term loan due 2018. All other ratings including its Caa2 Corporate Family Rating, Caa2 Probability of Default Rating, and SGL-3 Speculative Grade Liquidity rating were affirmed. The rating outlook is stable. The proceeds will be used to repay the $343 million (including $21.2 original issue discount) Tranche 3 term loan due 2014. Following the repayment, the Tranche 3 term loan will be retired and its B3 rating withdrawn. RIVERBANK OF WYOMING: Closed; Central Bank Assumes Deposits ----------------------------------------------------------- The RiverBank of Wyoming, Minn., was closed Friday, Oct. 7, 2011, by the Minnesota Department of Commerce, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Central Bank of Stillwater, Minn., to assume all of the deposits of The RiverBank. The six branches of The RiverBank will reopen during their normal business hours as branches of Central Bank. Depositors of The RiverBank will automatically become depositors of Central Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of The RiverBank should continue to use their existing branch until they receive notice from Central Bank that it has completed systems changes to allow other Central Bank branches to process their accounts as well. As of June 30, 2011, The RiverBank had around $417.4 million in total assets and $379.3 million in total deposits. In addition to assuming all of the deposits of the failed bank, Central Bank agreed to purchase essentially all of the assets. The FDIC and Central Bank entered into a loss-share transaction on $339.3 million of The RiverBank's assets. Central Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html Customers with questions about the transaction should call the FDIC toll-free at 1-877-367-2717. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/riverbank.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $71.4 million. Compared to other alternatives, Central Bank's acquisition was the least costly resolution for the FDIC's DIF. The RiverBank is the 75th FDIC-insured institution to fail in the nation this year, and the second in Minnesota. The last FDIC-insured institution closed in the state was Rosemount National Bank, Rosemount, on April 15, 2011. ROCHA DAIRY: Can Use Cash Collateral Through Confirmation of Plan ----------------------------------------------------------------- The Hon. Jim D. Pappas has authorized Rocha Dairy, LLC, to use the proceeds from the sale of milk and cull cows to pay operating expenses through the date of the confirmation of the Plan of Reorganization. Judge Pappas finds that irreparable harm or damage would occur unless the Debtor is authorized use of cash collateral. D.L. Evans Bank, Metropolitan Life Insurance Company and Rocky Mountain Merchandising will retain its lien with the same priority and to the extent they existed pre-petition, which includes milk, milk proceeds, cull cow proceeds and purchased cows and feed. The debtor is required to maintain at least 1,800 milking cows, including dry cows, and 1,150 heifers, for a total of herd size of 2,950 under the cash collateral order. In consideration for the use of cash collateral, including the cash proceeds of milk sold and cattle sold, those parties who claim an interest in the cash collateral to be used are granted post-petition adequate protection liens in all post-petition cows, milk, accounts, cash sales proceeds of milk and accounts and income to the same extent and in the same priority as their pre- petition liens existed on the date of filing, but only to the extent of cash collateral used. Commencing on August 15, 2011, and continuing during the term of the use of cash collateral, as an adequate protection, $10,000 a month will be paid to D.L. Evans Bank. A copy of the cash collateral budget is available for free at: http://bankrupt.com/misc/ROCHA_cashcollbudget.pdf About Rocha Dairy Based in Wendell, Idaho, Rocha Dairy, LLC, aka Rocha Farms, filed for Chapter 11 bankruptcy (Bankr. D. Idaho Case No. Case No. 11- 40836) on May 25, 2011. Judge Jim D. Pappas presides over the case. Lawyers at Robinson, Anthon & Tribe serve as bankruptcy counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by Elcidio Rocha, member. S-SI SAN JUAN: Case Summary & 10 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: S-SI San Juan Venture No. One, L.P. 105 N. Cesar Chavez Road San Juan, TX 78589 Bankruptcy Case No.: 11-70646 Chapter 11 Petition Date: October 3, 2011 Court: United States Bankruptcy Court Southern District of Texas (McAllen) Judge: Richard S. Schmidt Debtor's Counsel: Matthew Brian Probus, Esq. WAUSON PROBUS One Sugar Creek Ctr Blvd, Ste 880 Sugar Land, TX 77478 Tel: (281) 242-0303 Fax: (281) 242-0306 E-mail: mbprobus@w-plaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txsb11-70646.pdf The petition was signed by Troy Bathman, president of St. Ives Realty, Inc., manager of general partner. SAGAMORE PARTNERS: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Sagamore Partners, Ltd. dba Sagamore, The Art Hotel Sagamore Hotel 1177 Kane Concourse, Suite 201 Bay Harbor, FL 33154 Bankruptcy Case No.: 11-37867 Chapter 11 Petition Date: October 6, 2011 Court: U.S. Bankruptcy Court Southern District of Florida (Miami) Judge: A. Jay Cristol Debtor's Counsel: Peter D. Russin, Esq. MELAND RUSSIN & BUDWICK, P.A. 200 S Biscayne Boulevard, #3000 Miami, FL 33131 Tel: (305) 358-6363 Fax: (305) 358-1221 E-mail: prussin@melandrussin.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Martin W. Taplin, Pres of Miami Beach Vacation Resorts, Inc., manager of Sagamore GP, LLC, general partner. Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 14th Brickwell West, Ltd Loan $12,461,954 1177 Kane Concourse, Suite 201 Bay Harbor, FL 33154 Hall, Lamb & Hall, P.A. Professional Services $534,782 1428 Brickell Avenue PH Miami, FL 33131 Greenberg Traurig Professional Services $354,708 5100 Town Center Circle, Suite 400 Boca Raton, FL 33486 Flatiron Capital Insurance Premium $304,929 Dept 2195 Financing Denver, CO 80271-2195 Social Miami Trade Debt $235,291 Harbour Realty Advisors Inc Loan $212,935 Berger Singerman Professional Services $170,855 1177 Kane Concourse Pshp, Ltd Office Space Rent $157,047 Richard And Richard, P.A. Professional Services $139,187 The Taplin Company Ltd Loan $110,000 Harbour Realty Advisors, Inc. Professional Services $100,000 Fritella Management Trade Debt $68,644 Greenberg Traurig Professional Services $53,101 Bickerl & Brewer Professional Services $52,688 U.S. Alliance Management Corp. Litigation $50,000 Florida Dept of Revenue Taxes $33,427 Keith D. Silverstein, P.A. Professional Services $31,263 Boucher Brothers Management, Inc. Professional Services $27,517 Howard Hollander, P.A. Professional Services $27,142 Imperial Credit Corporation Insurance Premium $20,989 Financing SBARRO INC: Files "Improved Version" of Ch. 11 Exit Plan -------------------------------------------------------- Sbarro, Inc., along with its domestic subsidiaries and affiliates, announced has filed an Amended Disclosure Statement and related Amended Plan of Reorganization with the U.S. Bankruptcy Court for the Southern District of New York. The Company is pursuing an improved version of the plan of reorganization sponsored by certain of its first lien lenders that was originally filed in early August. Under the Amended Plan, Sbarro will significantly reduce its total debt and expects to emerge with approximately $110 million in net debt, and the Company's prepetition first lien lenders will become the new owners of the business by converting the majority of their debt to equity. Notably, the first lien lender sponsors have agreed to provide the Company with new money commitments of up to $35 million, which will provide significant additional liquidity for the Company's post-emergence operations. The amended plan has the support of all of Sbarro's key stakeholders, including the unsecured creditors committee. Nicholas McGrane, Interim President and Chief Executive Officer of Sbarro, said, "The amended plan is a positive development for Sbarro that will allow the Company to emerge from bankruptcy in the very near term with significantly reduced debt. The plan also provides the Company with approximately $35 million of new capital to continue our turnaround effort, which has already increased same store sales year-to-date, including continued improvement in the third quarter. In addition, through this process, the Company has been able to improve lease terms at a number of locations and close some underperforming restaurants. We appreciate the support of our first lien lenders and believe the ample liquidity they have provided -- combined with our reduced debt and operating expenses -- will position Sbarro for accelerated growth going forward." Key terms of the Amended Plan include: -- Converting up to $35 million of loans outstanding under Sbarro's DIP Facility into new first-out rollover term loans, which together with the new money term loans of up to $35 million will comprise the "First-Out Exit Term Loan Facilities" of the reorganized company. -- Converting a portion of the Prepetition First Lien Credit Facility into a $75 million "last-out" exit term facility; -- Converting the remaining approximately $100 million in secured indebtedness outstanding under the Prepetition First Lien Credit Facility into substantially all of the common equity of Reorganized Sbarro; and -- Eliminating all other outstanding debt. Importantly, the exit financing package provided by the first lien lenders allows the Company to exit bankruptcy in the fourth quarter with significant cash interest coverage. As the Company enters the fourth quarter -- historically its busiest period -- it expects to be able to generate positive cash flow before year-end, resulting in net leverage below $100 million and expected liquidity of approximately $40 million by the end of 2011. As previously disclosed, the Company obtained court approval for a plan overbid process, which established bidding procedures to allow interested third parties to "top" the first lien lenders' original stalking horse plan, which contemplated a $110 million "take back" exit facility and new money commitments of up to $18.6 million. Although several third parties expressed interest in pursuing a transaction, the Company did not hold an auction and instead determined that the revised plan sponsored by the first lien lenders represented the best way forward for Sbarro. Sbarro will seek approval of the amended disclosure statement at a hearing scheduled for October 11, 2011. If approved, the Company will begin to solicit votes on the Amended Plan, which it expects to confirm on November 17, 2011. The Company is being advised by Kirkland & Ellis LLP, its legal counsel, and Rothschild Inc., its financial advisor. Cantor Fitzgerald Securities, the agent for Sbarro's first lien lenders and post-petition debtor-in-possession lenders, is being advised by Davis Polk & Wardwell LLP, its legal counsel, and Conway Del Genio Gries & Co., LLC, its financial advisor. About Sbarro Inc. The Sbarro family started its business after moving to Brooklyn, New York, from Naples, Italy, in 1956. Today Sbarro is a leading, global Italian quick service restaurant concept with approximately 5,170 employees, 1,045 restaurants throughout 42 countries, and annual revenues in excess of $300 million. Sbarro Inc. sought bankruptcy protection under Chapter 11 (Bankr. S.D.N.Y. Lead Case No. 11-11527) to eliminate about $200 million in debt. The Debtor disclosed $51,537,899 in assets and $460,975,646 in liabilities as of the Chapter 11 filing. Sbarro said it has reached an agreement with all of its second- lien secured lenders and approximately 70% of its senior noteholders on the terms of a reorganization plan that will eliminate more than half of the Company's total indebtedness. Edward Sassower, Esq., and Nicole Greenblatt, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' general bankruptcy counsel. Rothschild, Inc., is the Debtors' investment banker and financial advisor. PriceWaterhouseCoopers LLP is the Debtors' bankruptcy consultants. Marotta Gund Budd & Dzera, LLC, is the Debtors' special financial advisor. Curtis, Mallet-Prevost, Colt & Mosle LLP serves as the Debtors' conflicts counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims agent. Sard Verbinnen & Co is the Debtors' communications advisor. SOLYNDRA INC: Energy Department Loan Official Resigns ----------------------------------------------------- Maria Chutchian at Bankruptcy Law360 reports that Jonathan Silver, head of the U.S. Department of Energy's loan guarantee program, resigned from his position Thursday following the controversy over $535 million the agency spent on Solyndra Inc. Law360 relates that Energy Secretary Steven Chu said Thursday that Mr. Silver had informed him in July that he would leave at the end of the fiscal year, according to a statement from the department. 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. SOUTH EDGE: New Inspirada Settlement Opens Door for Confirmation ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Chapter 11 plan covering South Edge LLC stands a better chance of approval at the Oct. 17 confirmation hearing now that the largest remaining dispute was settled. Focus Group South LLC was claiming to have a lien on about $26 million cash and was opposing approval of the reorganization plan. The secured bank lenders were contending that the cash was their collateral. The report relates that the settlement calls for the banks to receive $21 million in cash, while Focus takes $5 million from the disputed funds. In addition, other builders behind the South Edge project will buy out Focus's interest for $35.5 million. The plan implements a settlement negotiated in May by South Edge's Chapter 11 trustee with KB Home and other homebuilders who represented 92 percent of the ownership interests in the project. About South Edge Las Vegas, Nevada-based South Edge LLC owns the Inspirada project, an uncompleted 2,000-acre residential development in Henderson, Nevada, about 16 miles (26 kilometers) southeast of Las Vegas. The eight owners of the project include an affiliate of KB Home, a 49% owner. Other owners are Coleman Toll LP with 10.5%, Pardee Homes Nevada Inc. with 4.9%, Meritage Homes with 3.5%, and Beazer Homes USA Inc. with 2.6%. JPMorgan Chase Bank, N.A., Credit Agricole Corporate and Investment Bank, and Wells Fargo Bank, N.A., filed an involuntary chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 10-32968) on Dec. 9, 2010, against South Edge, LLC. The petitioning creditors are part of a lender group that provided a $595 million credit. New York-based JPMorgan serves as lender and agent for the group. South Edge filed motions to dismiss the involuntary petition. The Court conducted a contested trial on Jan. 24 and 25, 2011, and Feb. 2 and 3, 2011. On Feb. 3, 2011, the Court entered an order for relief under Chapter 11 of the Bankruptcy Code against the Debtor and issued an order directing the appointment of a chapter 11 trustee. The United States Trustee appointed Cynthia Nelson to serve as Chapter 11 trustee on Feb. 20, 2011. The Court approved the appointment three days later. South Edge is represented by lawyers at Klee, Tuchin, Bogdanoff and Stern LLP, and The Schwartz Law Firm, Inc., as legal counsel. The Chapter 11 trustee also tapped Schwartzer & McPherson Law Firm as local counsel. Petitioning creditors JPMorgan Chase Bank, N.A., and Wells Fargo Bank, N.A., are represented by lawyers at Morrison and Foerster LLP; and Lewis and Roca LLP. Credit Agricole is represented by lawyers at Haynes and Boone LLP, and Jolley Urga Wirth Woodbury & Standish. SPANISH BROADCASTING: Marko Radlovic Resigns as CRO & Gen. Mngr. ---------------------------------------------------------------- Marko Radlovic resigned as the Chief Revenue Officer of the radio segment division of Spanish Broadcasting System, Inc., and General Manager and Senior Vice President of the Los Angeles radio market. About Spanish Broadcasting Headquartered in Coconut Grove, Florida, Spanish Broadcasting System, Inc. -- http://www.spanishbroadcasting.com/-- owns and operates 21 radio stations targeting the Hispanic audience. The Company also owns and operates Mega TV, a television operation with over-the-air, cable and satellite distribution and affiliates throughout the U.S. and Puerto Rico. Its revenue for the twelve months ended Sept. 30, 2010, was approximately $140 million. The Company reported net income of $15.04 million on $136.12 million of net revenue for the year ended Dec. 31, 2010, compared with a net loss of $13.78 million on $139.39 million of net revenue during the prior year. The Company's balance sheet at June 30, 2011, showed $481.77 million in total assets, $434.08 million in total liabilities, $92.35 million in cumulative exchangeable redeemable preferred stock and a $44.66 million total stockholders' deficit. * * * In November 2010, Moody's Investors Service upgraded the corporate family and probability of default ratings for Spanish Broadcasting System, Inc., to 'Caa1' from 'Caa3' based on improved free cash flow prospects due to better than anticipated cost cutting and the expiration of an unprofitable interest rate swap agreement. Moody's said Spanish Broadcasting's 'Caa1' corporate family rating incorporates its weak capital structure, operational pressure in the still cyclically weak economic climate, generally narrow growth prospects (though Spanish language is the strongest growth prospect) given the maturity and competitive pressures in the radio industry, and the June 2012 maturity of its term loan magnify this challenge. In July 2010, Standard & Poor's Ratings Services raised its corporate credit rating on Miami, Fla.-based Spanish Broadcasting System Inc. to 'B-' from 'CCC+', based on continued improvement in the company's liquidity position. The rating outlook is stable. "The rating action reflects S&P's expectation that, despite very high leverage, SBS will have adequate liquidity over the intermediate term to meet debt maturities, potential swap settlements, and operating needs until its term loan matures on June 11, 2012," said Standard & Poor's credit analyst Michael Altberg. STEAK N SHAKE: S&P Assigns 'B+' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Rating Services assigned its 'B' corporate credit rating to Indianapolis-based Steak n Shake Operations Inc. The outlook is stable. "At the same time, we assigned our 'BB-' issue-level rating to the company's senior secured first-lien credit facility, which consists of a $20 million three-year revolver and a $110 million four-year term loan. The recovery rating is '1', indicating our expectation for very high (90%-100%) recovery for lenders in the event of a payment default. Steak n Shake used proceeds from the facility to fund a dividend to its parent, Biglari Holdings Inc. (BH; unrated), and to refinance existing debt," S&P related. "The ratings on Steak n Shake reflect our view of the company's very aggressive financial policy. Although credit measures are currently better than medians for the 'B' rating category, we expect this may be transitory and future debt-financed dividends to BH are likely and will lead to weaker credit metrics," S&P stated. Steak n Shake is a wholly owned subsidiary of BH, a public company. Currently, Steak n Shake accounts for the majority of sales and earnings of BH and as such, credit measures are comparable for both entities. BH's strategy is to reinvest cash generated by its operating subsidiaries into acquisitions of other businesses. "Over the past two fiscal years, Steak n Shake distributed about $104 million in advances and dividends to BH. Because all operating and financial decisions for Steak n Shake are made by BH -- mainly by its CEO -- we view Steak n Shake's financial policy and governance as very aggressive," S&P said. "Pro forma for the transaction, leverage is about 4.1x at July 6, 2011, and EBITDA interest coverage is about 2.9x. In the near term, we expect leverage to decline to below 4.0x, mainly because of debt reduction. Under the terms of the credit agreement, the company faces steep amortization payments of 10% per year. In addition, the company is required to sweep 75% of its excess cash flow toward debt payment. However, we believe that these measures will not be sustained, based on our expectation that BH will use debt to finance future acquisitions. Although dividends are currently limited, we believe the existing agreement could either be amended or refinanced to allow for greater dividend payments," S&P related. STERLING FINANCIAL: Fitch Withdraws 'B' LT Issuer Default Rating ---------------------------------------------------------------- Fitch Ratings has affirmed Sterling Financial Corporation's (STSA) and its main subsidiary, Sterling Savings Bank, long-term and short-term Issuer Default Ratings (IDR) at 'B' and 'B', respectively. At the same time, Fitch has withdrawn all of the company's ratings and will no longer provide ratings or analytical coverage. STSA's ratings are no longer considered by Fitch to be relevant to the agency's coverage. STSA is a $9.2 billion bank holding company headquartered in Spokane, WA. Fitch has affirmed and withdrawn the following ratings: Sterling Financial Corporation -- Long-term Issuer Default Rating (IDR) at 'B'; -- Short-term IDR at 'B'; -- Viability at 'b'; -- Individual at 'D'; -- Support at '5'; -- Support floor at 'NF'. Sterling Savings Bank -- Long-term deposits at 'B+/RR3'; -- Long-term IDR at 'B'; -- Short-term deposits at 'B'; -- Short-term IDR at 'B'; -- Viability at 'b'; -- Individual at 'D'; -- Support at '5'; -- Support floor at 'NF'. STILLWATER MINING: Moody's Withdraws B2 Rating on $300MM Notes -------------------------------------------------------------- Moody's Investors Service withdrew the B2 rating on Stillwater Mining Company's proposed $300 million senior unsecured notes due 2016 due to company's withdrawal of the notes offering. In a related rating action, Moody's affirmed Stillwater's Corporate Family Rating (CFR) and Probability of Default ratings at B2, as well as the B2 rating on the company's $30 million revenue bonds due 2020. The rating outlook is stable. RATINGS RATIONALE Stillwater previously announced that it withdrew the proposed senior notes offering due to unfavorable market conditions. The proceeds from the notes issuance were intended to be used, together with cash on hand, to fund the cash portion of the company's acquisition of Peregrine Metals (a Canada headquartered company), for other expansion, and for general corporate purposes. Since the company terminated the $200 million bridge facility and currently does not a revolver in place, it completed the acquisition of Peregrine on October 4, 2011 using the cash on hand. Stillwater indicated that, as of September 26, 2011, it had cash and short term investments on hand of $255 million, and expected the net cash portion of the acquisition to be $165 million. The affirmation of the B2 CFR reflects the meaningful recovery in Stillwater's primary end-market (the automotive sector) and the increase in palladium and platinum pricing since their respective troughs during the past financial crisis. The rating also considers the company's moderate debt level, and minimal debt service requirements. The CFR remains constrained by the company's exposure to the volatile palladium and platinum precious metal markets, primary reliance on mines in a single ore body, and exposure to the cyclical automotive industry as its primary end market. The stable rating outlook anticipates that Stillwater will maintain a liquidity position sufficient to support its operations over the next two years, while the company increases its capital spend to develop its Marathon asset in Canada. A positive action is unlikely in the near term given the execution risk, reduced liquidity, and the potential that the company could need to raise additional debt to support the capital spend of roughly $450 million required to develop the Marathon project through 2013-14. A negative outlook or downgrade is possible if the company's liquidity level (unrestricted cash/investments and potential revolver availability) were to fall below $100 million for an extended period or if PGM prices drop further substantially on an average realized basis. Leverage approaching 4.0 times and cash flow from operations to debt below 20% could also result in negative rating pressure. These ratings/assessments have been affected: $300 million senior unsecured notes due 2016 rated B2 (LGD4, 52%), withdrawn; Corporate Family Rating affirmed at B2; Probability of Default Rating affirmed at B2; $30 million unsecured Revenue Bonds due 2020, affirmed at B2 (LGD4, 55%) from B2 (LGD4, 52%). The rating outlook is stable. The principal methodology used in rating Stillwater Mining Company was the Global Mining Industry Methodology published in May 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. Stillwater Mining Company is engaged in underground mining, smelting and refining of palladium, platinum and associated minerals. The company's mining operations consist of the Stillwater and East Boulder mines, which are located at the eastern and western ends of the J-M Reef in Montana, as well as the Marathon PGM project in Canada. Stillwater also operates a smelter and refinery where, in addition to processing its mined production, it recycles spent automotive catalyst materials to recover platinum group metals (PGMs). The company had revenue of $680 million for the last twelve month period ended 6/30/2011. SUMMIT III: Notifies on Change of Address ----------------------------------------- Summit III LLC notifies the U.S. Bankruptcy Court for the Northern District of West Virginia of its change of address. The new address for the Debtor is: Summit III LLC 295 Seven Farms Drive Suite C-296 Daniel Island, South Carolina 29492 About Summit III Summit III LLC, based in Snowshoe, West Virginia, filed for bankruptcy (Bankr. N.D. W.Va. Case No. 11-01448) on Aug. 11, 2011. Judge Patrick M. Flatley presides over the case. Steven L. Thomas, Esq., at Kay, Casto & Chaney, serves as the Debtor's bankruptcy counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by Samuel M. Levin, Summit III's manager. SUN SECURITY BANK: Closed; Great Southern Bank Assumes Deposits --------------------------------------------------------------- Sun Security Bank of Ellington, Mo., was closed Friday, Oct. 7, 2011, by the Missouri Division of Finance, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Great Southern Bank of Springfield, Mo., to assume all of the deposits of Sun Security Bank. The 27 branches of Sun Security Bank will reopen during their normal business hours, and after the Columbus Day holiday all branches of Sun Security Bank will reopen as branches of Great Southern Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Sun Security Bank should continue to use their existing branch until they receive notice from Great Southern Bank that it has completed systems changes to allow other Great Southern Bank branches to process their accounts as well. As of June 30, 2011, Sun Security Bank had around $355.9 million in total assets and $290.4 million in total deposits. In addition to assuming all of the deposits of the failed bank, Great Southern Bank agreed to purchase essentially all of the assets. The FDIC and Great Southern Bank entered into a loss-share transaction on $351.9 million of Sun Security Bank's assets. Great Southern Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html Customers with questions about the transaction should call the FDIC toll-free at 1-866-806-6128. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/sunsecurity.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $118.3 million. Compared to other alternatives, Great Southern Bank's acquisition was the least costly resolution for the FDIC's DIF. Sun Security Bank is the 76th FDIC-insured institution to fail in the nation this year, and the first in Missouri. The last FDIC-insured institution closed in the state was Premier Bank, Jefferson City, on Oct. 15, 2010. SUNRISE REAL ESTATE: Issues 2.5MM Shares to Better Time ------------------------------------------------------- Sunrise Real Estate Group, Inc., and Sunrise Real Estate Development Group, Inc., received the $500,000 from Better Time International and has issued 2,500,000 shares of common stock to Better Time on Sept. 30, 2011 Sunrise, on Jan. 22, 2011, entered into a Share Purchase Agreement with Better Time to issue 2,500,000 shares to Better Time for US$500,000. This agreement, subject to standard closing terms and conditions, was scheduled to close on or before March 20, 2011. On March 16, 2011, Sunrise and Better Time agreed to extend the scheduled closing date of the Share Purchase Agreement, subject to standard closing terms and conditions, to on or before July 1, 2011. All other terms and conditions of the Share Purchase Agreement remain unchanged and in full force and effect. On July 1, 2011, Sunrise and Better Time agreed to extend the scheduled closing date of the Share Purchase Agreement, subject to standard closing terms and conditions, to on or before Sept. 30, 2011. All other terms and conditions of the Share Purchase Agreement remain unchanged and in full force and effect. About Sunrise Real Headquartered in Shanghai, the People's Republic of China, Sunrise Real Estate Group, Inc. was initially incorporated in Texas on Oct. 10, 1996, under the name of Parallax Entertainment, Inc. On Dec. 12, 2003, Parallax changed its name to Sunrise Real Estate Development Group, Inc. On April 25, 2006, Sunrise Estate Development Group, Inc. filed Articles of Amendment with the Texas Secretary of State, changing the name of Sunrise Real Estate Development Group, Inc. to Sunrise Real Estate Group, Inc., effective from May 23, 2006. The Company and its subsidiaries are engaged in the property brokerage services, real estate marketing services, property leasing services and property management services in China. The Company's balance sheet at June 30, 2011, showed US$19.70 million in total assets, US$23.05 million in total liabilities, US$1.41 million in noncontrolling interests of consolidated subsidiaries, and a US$4.75 million total shareholders' deficit. The Company reported a net loss of US$25,487 on US$12.82 million of net revenues for the year ended Dec. 31, 2010, compared with net income of US$3.27 million on US$13.11 million of net revenues during the prior year. Going Concern The Company has accumulated losses of $10,563,169 for the year ended June 30, 2011. The Company's net working capital deficiency and significant accumulated losses raise substantial doubt about the Company's ability to continue as a going concern. However, management believes that the Company is able to generate sufficient cash flow to meet its obligations on a timely basis and ultimately to attain successful operations in respect of the agency sales and property management operations. As reported by the TCR on April 21, 2011, Kenne Ruan, CPA, P.C., in Woodbridge, CT, USA, noted that the Company has significant accumulated losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. SUPERMEDIA INC: Moody's Lowers CFR to Caa1; Outlook Negative ------------------------------------------------------------ Moody's Investors Service has changed the corporate family rating (CFR) for SuperMedia Inc. to Caa1 from B3 prior. The downgrade reflects Moody's belief that revenues will continue to decline at a double digit rate for the foreseeable future, leading to a steady decline in free cash flow. SuperMedia's sales were down 17% for 2Q'11 in a generally improving advertising sector. Moody's ratings outlook for SuperMedia remains negative. Moody's has taken the following rating actions: Issuer: SuperMedia Inc. These ratings were changed: -- Corporate Family Rating, Caa1 from B3 prior -- Probability of Default Rating, Caa2 from Caa1 prior -- $2.2 billion Term Loan, Caa1 LGD3-34% from B3 LGD3-35% prior These ratings are unchanged: -- Speculative Grade Liquidity, SGL 2 -- Outlook: Negative RATINGS RATIONALE Continued weakness in ad sales relative to expected spending in other print-based channels and the overall advertising market suggests that the cyclical recovery in client advertising spending is not stabilizing revenue in the directory industry. Moody's thus believes the magnitude of the structural challenges the directory industry faces are more severe than previously anticipated. While SuperMedia is attempting to transition the business away from its reliance on print advertising through development of online and mobile directory service applications, Moody's is increasingly concerned that the company will not be able to make this change quickly enough to stabilize the revenue base over the intermediate term. Further, the high fixed cost nature of SuperMedia's business could lead to steep margin compression, notwithstanding continued aggressive cost management. SuperMedia has good liquidity, supported by Moody's projection of $215 million in cash at year end 2011 and ongoing positive free cash flow. The company requires minimal capital investment, well below internally generated cash flows. Additionally, SuperMedia can opt to accrue approximately 20% of interest as principal, offering additional flexibility. Rating Outlook The negative outlook reflects Moody's concerns that the pace of decline in revenue and new orders (as indicated by the company's advertising sales), which is faster than Moody's had anticipated, will persist despite a recovery in overall U.S. advertising spending. Although improved from the cycle's trough of down 21% in 1Q'10/4Q'09, advertising sales were down 17% for 2Q'11 amidst a generally improving advertising sector. Continued weakness in ad sales relative to expected spending in other print-based channels and the overall advertising market suggests that the cyclical recovery in client advertising spending is not stabilizing revenue in the directory industry. Moody's thus believes the magnitude of the structural challenges the directory industry faces are more severe than previously anticipated. What Could Change the Rating -- Down Moody's could lower SuperMedia's ratings further if the company's revenues continue to fall at a double digit rate, if it becomes unable to generate meaningful free cash flow without exercising the PIK option, or if its liquidity becomes strained. What Could Change the Rating -- Up Given the likelihood that both secular and cyclical pressures will continue to impact revenues and adversely affect SuperMedia's credit metrics, Moody's does not anticipate any upward ratings momentum over the intermediate term. If the company is able to successfully offset declining print revenues with growth of its online business such that revenue and leverage begin to stabilize, an upgrade would be considered. The last rating action Moody's took on SuperMedia was on January 6, 2011 when the company's PDR was lowered to Ca/LD and the outlook was changed to negative. SuperMedia'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 SuperMedia's core industry and believes SuperMedia's ratings are comparable to those of other issuers with similar credit risk. SuperMedia Inc., headquartered in D/FW Airport, Texas, is the second largest U.S. yellow pages publisher. The company reported revenues of $1.8 billion (pro forma) for the twelve months ended June 30, 2011. TH PROPERTIES: U.S. Trustee Seeks Chapter 7 Conversion ------------------------------------------------------ Tony Di Domizio at Montgomeryville-LandsdalePatch reports that U.S. Trustee Roberta DeAngelis has filed for a motion seeking to convert TH Properties LLC's Chapter 11 case to a Chapter 7 liquidation bankruptcy. The report says Ms. DeAngelis alleges that: -- THP has surrendered all its collateral with all its secured lenders and that THP also failed to submit a plan of reorganization under Chapter 11; -- THP also accrued $2.867 million in post-petition payables as of August 2011. Of that, $2.64 million are unpaid professional fees; -- THP garnered $96,497 in case flow deficit in August 2011, according to court documents. "The Debtor has repeated promised a plan to be forthcoming, but has yet to submit the same," said Ms. DeAngelis, according to the report. "Hence, there does not seem to be a reasonable likelihood of rehabilitation." The report relates that THP attorney Joseph O'Neil, Esq., said THP's Chapter 11 reorganization is ongoing and will continue until such time as the bankruptcy court orders otherwise. "At no time has THP sought conversion of its case from a reorganization to a chapter 7, and it has no intentions of doing so," said Mr. O'Neil, according to the report. "THP shall respond to the motions filed by other parties in interest in its cases at the appropriate time in accordance with the applicable rules of the Court." About T.H. Properties Philadelphia-based T.H. Properties, L.P., has 12 working developments in Pennsylvania and New Jersey. Timothy Hendricks and his brother Todd started the firm in 1992. T.H. Properties and its affiliates filed for Chapter 11 bankruptcy protection on April 30, 2009 (Bankr. E.D. Pa. Case No. 09-13201). Northgate Development Company, LP (Bankr. E.D. Calif. Case No. 09-____) was among the affiliates that filed. Barry E. Bressler, Esq., at Schnader, Harrison, Segal & Lewis, LLP, and Natalie D. Ramsey, Esq., at Montgomery McCracken Walker and Rhoads LLP, represent the Debtors in their restructuring efforts. T.H. Properties estimated assets between $100 million and $500 million, and debts between $10 million and $50 million in its Chapter 11 petition. A creditors' committee has been appointed in the Debtors' chapter 11 proceedings. Affiliate Wynstone Development Group, LP (Bankr. E.D. Calif. Case No. 10-17863) filed for Chapter 11 protection on Sept. 14, 2010. It estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. THOMASTON HOUSING: S&P Lowers Rating on Revenue Bonds to 'BB-' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term rating on Thomaston Housing Authority, Ga.'s multifamily housing revenue bonds series 2004, issued for the Fairview Apartments Project, to 'BB-' from 'BB+'. "The downgrade is based on our view of the project's reliance on short-term market rate investments," said Standard & Poor's credit analyst Renee J. Berson. The rating reflects S&P's view of these: Revenues from mortgage debt service payments and investment earnings are insufficient to pay full and timely debt service on the bonds until maturity; Debt service coverage is projected to fall below investment- grade levels on the remarketing date; and Asset/liability parity is projected to fall below 100% in 2023. Credit strengths in the issue include S&P's opinion of: Investments held in U.S. Treasury Obligations Fund Institutional money market fund (AAAm); and The high credit quality of the Fannie Mae pass-through certificate, which S&P considered to be 'AA+' eligible. "Standard & Poor's has analyzed updated financial information based on our current stressed reinvestment rate assumptions for all scenarios as set forth in the criteria for certain federal government-enhanced housing transactions. We believe the bonds are unable to meet all bond costs from transaction revenues until maturity, assuming these reinvestment earnings," S&P related. TOWNSENDS INC: Wins Court Nod to Convert Bankruptcy to Chapter 7 ---------------------------------------------------------------- Liz Hoffman at Bankruptcy Law360 reports that a Delaware bankruptcy judge on Wednesday granted Townsends Inc.'s request to convert its bankruptcy from Chapter 11 to a Chapter 7 liquidation, but gave the company a week to tie up loose ends before putting a trustee in charge. The conversion will be effective Oct. 13, and U.S. Bankruptcy Judge Christopher Sontchi will appoint a trustee to oversee liquidation of the company's remaining assets, according to Law360. 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. TTC PLAZA: Capital One Wants to Proceed With Foreclosure -------------------------------------------------------- Capital One N.A. seeks relief from the automatic stay in the bankruptcy case of TTC Plaza L.P. to exercise its rights in all of the Debtor?s (a) real property and improvements comprising of 8.715 acres of land situated in the John D. Taylor League, Abstract number 72, Harris County, City of Houston, Texas, and (b) rents and proceeds. Capital One said it would show to the Court that ?cause? exists inasmuch as the Debtor's case is essentially a two-party dispute where the Debtor filed the Chapter 11 petition in bad faith in order to forestall a foreclosure proceeding scheduled for Oct. 4, 2011. On June 23, 2006, the Debtor executed and delivered to Capital One a Promissory Note in the original principal amount of $4,998,000. The Note had a stated maturity date of June 23, 2008. In exchange, the Debtor granted Capital One an interest in a tract of real property situated in Harris County. On June 23, 2008, the Note matured and the Debtor defaulted on its obligations to Capital One under the Note due to nonpayment. Capital One has renewed or extended the Note on several occasions since its inception. Capital One said the Debtor?s multiple attempts to sell the Property after default have proved futile. As of the bankruptcy filing date, the Debtor owed Capital One $4,746,265, which include interests and attorneys fees and expenses. The interest and attorneys fees continue to accrue. Capital One is represented by: Bruce J. Ruzinsky, Esq. Matthew D. Cavenaugh, Esq. JACKSON WALKER L.L.P. 1401 McKinney, Suite 1900 Houston, TX 77010 Tel: (713) 752-4200 Fax: (713) 308-4221 E-mail: bruzinsky@jw.com mcavenaughl@jw.com TTC Plaza L.P. filed for Chapter 11 bankruptcy (Bankr. S.D. Tex. Case No. 11-38381) on Oct. 3, 2011, before Judge Marvin Isgur. Jack Nicholas Fuerst, Esq., in Houston, Texas, represents the Debtor. The Debtor scheduled assets of $12,016,768 and liabilities of $5,312,263. The petition was signed by William Wu, managing partner. TTC PLAZA: Status Conference Scheduled for Nov. 8 ------------------------------------------------- The Bankruptcy Court will hold a status conference in the bankruptcy case of TTC Plaza L.P. on Nov. 8, 2011, at 1:30 p.m. at Houston, Courtroom 404 (MI). TTC Plaza L.P. filed for Chapter 11 bankruptcy (Bankr. S.D. Tex. Case No. 11-38381) on Oct. 3, 2011, before Judge Marvin Isgur. Jack Nicholas Fuerst, Esq., in Houston, Texas, represents the Debtor. The Debtor scheduled assets of $12,016,768 and liabilities of $5,312,263. The petition was signed by William Wu, managing partner. TTC PLAZA: Sec. 341 Creditors' Meeting Set for Nov. 8 ----------------------------------------------------- The U.S. Trustee for the Southern District of Texas in Houston will convene a Meeting of Creditors in the bankruptcy case of TTC Plaza L.P. on Nov. 8, 2011, at 10:00 a.m. at Houston, 515 Rusk Suite 3401. 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. Proofs of claim are due in the case by Feb. 6, 2012. TTC Plaza L.P. filed for Chapter 11 bankruptcy (Bankr. S.D. Tex. Case No. 11-38381) on Oct. 3, 2011, before Judge Marvin Isgur. Jack Nicholas Fuerst, Esq., in Houston, Texas, represents the Debtor. The Debtor scheduled assets of $12,016,768 and liabilities of $5,312,263. The petition was signed by William Wu, managing partner. UNITED AUTOMOBILE: A.M. Best Upgrades FSR to 'C++' -------------------------------------------------- A.M. Best Co. has upgraded the financial strength rating (FSR) to C++ (Marginal) from C (Weak) and the issuer credit rating (ICR) to "b" from "ccc" of United Automobile Insurance Company (United Auto) (Miami Gardens, FL). The ratings have been removed from under review with developing implications and assigned a stable outlook. A.M. Best also has withdrawn the FSR of C (Weak) and ICR of "ccc" of United Automobile Insurance Group (Miami Gardens, FL), due to the group no longer being in existence. These rating actions follow United Auto's subsidiary, Argus Fire & Casualty Insurance Company (Argus), fulfilling the terms of a Consent Order issued by the Florida Office of Insurance Regulation on May 31, 2011, which required Argus to cancel all in force policies. The ratings of United Auto reflects its adequate risk- adjusted capitalization and variability of operating results in recent years, led by investment and fee income, during a period of challenging economic conditions, particularly within its niche of personal non-standard automobile. Where necessary, the company has adjusted rates, which led to some improvement in underwriting performance in recent years. In addition, United Auto's loss reserve strengthening and more favorable loss trends, albeit still inconsistent, have helped to improve the company's development in recent periods. These positive rating factors are somewhat offset by United Auto's historically variable underwriting performance. Furthermore, United Auto has maintained elevated underwriting leverage measures in recent years, which has put pressure on its risk-adjusted capital position. Moreover, the company maintains a somewhat modest business profile with limited product availability and concentrations in states with difficult operating environments for the non-standard automobile segment. WASHINGTON MUTUAL: Blocked From Holding Quick Confirmation Hearing ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Washington Mutual Inc. failed Oct. 6 to persuade the bankruptcy judge to schedule a near-term confirmation hearing on a modified reorganization plan while mediation goes ahead on a parallel track. When U.S. Bankruptcy Judge Mary F. Walrath for a second time disapproved WaMu's plan, she directed the parties in her Sept. 13 opinion to mediate. WaMu wanted only to mediate disputes between noteholders and equity holders while moving ahead with confirmation. Judge Walrath said "no," according to the Bloomberg report. Telling the parties they must also try to settle disputes regarding the plan, the judge said she doesn't want to conduct another contested confirmation hearing "without trying" to reach a truly global settlement. Although the mediator is yet to be selected, the mediator's initial report will be due Nov. 7, Juge Walrath said Oct. 6. As reported in the Oct. 6, 2011 edition of the TCR, WaMu asked the bankruptcy judge to move ahead with confirmation while the mediation process on a parallel track. WaMu said that pausing for another vote will delay confirmation by two or three months and result in a $60 million to $90 million loss for the so-called Piers creditors who are at the bottom of the distribution waterfall. The losses would result from fees and expenses and the continued accrual of interest owing to senior creditor classes. The bank holding company likewise opposes holding up the confirmation process pending mediation that Judge Walrath required when she denied confirmation last month. WaMu says that mediation should focus on the lawsuit that the judge is allowing equity holders to bring against noteholders who allegedly traded debt using non-public information. About WaMu Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- was the holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York, and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan, upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. However, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. WaMu filed a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement, which it believes would address the Bankruptcy Court's concerns. On Sept. 13, 2011, Judge Walrath denied confirmation of WaMu's Modified Sixth Amended Plan and granted equity committee standing to prosecute claims for equitable disallowance but stayed the ruling pending mediation. Judge Walrath scheduled a status hearing for Oct. 7, 2011, at 11:30 a.m. to consider the issues to be referred to a mediator. WaMu said it would seek confirmation of a revised plan "as soon as practicable." The Plan proposes to pay more than $7 billion to creditors and incorporates a global settlement agreement resolving issues among the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp. in its corporate capacity and as receiver for WaMu Bank, certain large creditors, certain WMB senior noteholders, and the creditors' committee. The Settlement Noteholders are Appaloosa Management, L.P., Aurelius Capital Management LP, Centerbridge Partners, LP, and Owl Creek Asset Management, L.P. WASHINGTON MUTUAL: Judge Denies Bid to Limit Mediation ------------------------------------------------------ Lance Duroni at Bankruptcy Law360 reports that Washington Mutual Inc. lost its bid on Thursday to fast-track a third attempt at confirming its reorganization plan, failing to convince a Delaware bankruptcy judge that the insider trading claims that doomed its previous plan could be mediated separately from the broader plan process. As reported in the Troubled Company Reporter on Sept. 15, 201, Judge Mary F. Walrath denied confirmation of Washington Mutual Inc.'s Modified Sixth Amended Joint Plan, filed on March 16, 2011, as modified on March 25, 2011. Judge Walrath also granted the official equity committee's motion for standing to prosecute claims for equitable disallowance but stayed the ruling pending mediation. Judge Walrath scheduled a status hearing for Oct. 7, 2011, at 11:30 a.m. to consider the issues to be referred to a mediator. WaMu, according to Bloomberg News, issued a statement Sept. 13 saying it would seek confirmation of a revised plan "as soon as practicable." The Plan proposes to pay more than $7 billion to creditors and incorporates a global settlement agreement resolving issues among the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp. in its corporate capacity and as receiver for Washington Mutual Bank, certain large creditors, certain WMB senior noteholders, and the creditors' committee. The Settlement Noteholders are Appaloosa Management, L.P., Aurelius Capital Management LP, Centerbridge Partners, LP, and Owl Creek Asset Management, L.P. BankruptcyData.com reports that Washington Mutual's official committee of equity security holders filed with the U.S. Bankruptcy Court a response to the statement of Debtors with respect to (A) scope and participation in mediation and (B) confirmation of the Modified Plan. The response asserts, "In the Statement, the Debtors attempt to shirk the Court's direction that the parties mediate all impediments to confirmation of a plan as well as the issues attendant to the Equity Committee's claims against the Settlement Note Holders. Rather, the Debtors seek to bypass entirely any mediation on the plan and instead propose to press forward immediately with an attempt to confirm yet another variation on the rejected plan of reorganization, a re-revised plan which the Debtors unjustifiably claim faces 'no impediment' to confirmation. (Statement, 17). This high-handed and inflexible approach invites a third contested confirmation hearing In fact, much of the expense and delay complained of in the Debtors' Statement is of the Debtors' own making, traceable to the Debtors' willful refusal to accommodate - or even to acknowledge - the interests of many of its constituents." The trust preferred holders filed their own response, explaining, "From the perspective of the TPS Consortium, numerous issues (whether to be raised at a subsequent confirmation hearing or in connection with further appellate proceedings) remain impediments to the Debtors' ultimate ability to emerge from bankruptcy, and therefore, should be addressed in connection with the Court- Ordered mediation." About WaMu Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- was the holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York, and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan, upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. However, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. WaMu filed a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement, which it believes would address the Bankruptcy Court's concerns. On Sept. 13, 2011, Judge Walrath denied confirmation of WaMu's Modified Sixth Amended Plan and granted equity committee standing to prosecute claims for equitable disallowance but stayed the ruling pending mediation. Judge Walrath scheduled a status hearing for Oct. 7, 2011, at 11:30 a.m. to consider the issues to be referred to a mediator. WaMu said it would seek confirmation of a revised plan "as soon as practicable." The Plan proposes to pay more than $7 billion to creditors and incorporates a global settlement agreement resolving issues among the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp. in its corporate capacity and as receiver for WaMu Bank, certain large creditors, certain WMB senior noteholders, and the creditors' committee. The Settlement Noteholders are Appaloosa Management, L.P., Aurelius Capital Management LP, Centerbridge Partners, LP, and Owl Creek Asset Management, L.P. WASHINGTON MUTUAL: Creditors Seek Probe of Trading Decision ----------------------------------------------------------- Dow Jones' Daily Bankruptcy Review reports that the official creditors committee in Washington Mutual Inc.'s Chapter 11 case has joined the ranks of those pushing to appeal a ruling that put some of the country's most powerful distressed-debt investing firms in danger of going to trial for insider trading. About WaMu Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- was the holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York, and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan, upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. However, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. WaMu filed a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement, which it believes would address the Bankruptcy Court's concerns. On Sept. 13, 2011, Judge Walrath denied confirmation of WaMu's Modified Sixth Amended Plan and granted equity committee standing to prosecute claims for equitable disallowance but stayed the ruling pending mediation. Judge Walrath scheduled a status hearing for Oct. 7, 2011, at 11:30 a.m. to consider the issues to be referred to a mediator. WaMu said it would seek confirmation of a revised plan "as soon as practicable." The Plan proposes to pay more than $7 billion to creditors and incorporates a global settlement agreement resolving issues among the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp. in its corporate capacity and as receiver for WaMu Bank, certain large creditors, certain WMB senior noteholders, and the creditors' committee. The Settlement Noteholders are Appaloosa Management, L.P., Aurelius Capital Management LP, Centerbridge Partners, LP, and Owl Creek Asset Management, L.P. WASHINGTON MUTUAL: Confirms Release of Securities Tendered ---------------------------------------------------------- Washington Mutual, Inc. confirmed that it has instructed The Depository Trust Company to release, and return to the target CUSIP accounts, securities that were tendered into contra-CUSIP accounts established with DTC. Once securities have been returned to the target CUSIP accounts, such securities will be available for trading by the holders of such securities. These securities were tendered to contra-CUSIP accounts for the purpose of identifying and "freezing" trading of the securities in connection with release and exchange elections made with respect to WMI's proposed Modified Sixth Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of the United States Bankruptcy Code, dated February 7, 2011. The holders of the securities will have an opportunity to resubmit release and exchange elections in connection with any modification to the Plan or any other chapter 11 plan of reorganization filed in the future. Except as noted below, all prior elections with respect to released securities shall be disregarded. Holders of (a) WMB Senior Notes - both those who filed claims classified as "WMB Senior Notes Claims" in Class 17A as well as Non-Filing WMB Senior Note Holders - and (b) preferred shares classified as "REIT Series" in Class 19 shall not have an opportunity to resubmit release elections; such holders' elections made in connection with the Plan shall remain valid and enforceable in connection with respect to any modification to the Plan or any other chapter 11 plan of reorganization filed in the future. To the extent that a holder elected to grant the releases set forth in the Plan, such holders' information was recorded in an escrow CUSIP account established with DTC, or recorded by Euroclear Bank S.A./N.V. or Clearstream Banking, societe anonyme as applicable, prior to such holders' securities being previously released from the contra-CUSIP. Security holders affected by these procedures should consult with their respective financial and legal advisors. Additional details, as well as WMI's Plan and related disclosure statement are available at http://www.kccllc.net/wamu/ About WaMu Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- was the holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York, and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan, upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. However, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. WaMu filed a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement, which it believes would address the Bankruptcy Court's concerns. On Sept. 13, 2011, Judge Walrath denied confirmation of WaMu's Modified Sixth Amended Plan and granted equity committee standing to prosecute claims for equitable disallowance but stayed the ruling pending mediation. Judge Walrath scheduled a status hearing for Oct. 7, 2011, at 11:30 a.m. to consider the issues to be referred to a mediator. WaMu said it would seek confirmation of a revised plan "as soon as practicable." The Plan proposes to pay more than $7 billion to creditors and incorporates a global settlement agreement resolving issues among the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp. in its corporate capacity and as receiver for WaMu Bank, certain large creditors, certain WMB senior noteholders, and the creditors' committee. The Settlement Noteholders are Appaloosa Management, L.P., Aurelius Capital Management LP, Centerbridge Partners, LP, and Owl Creek Asset Management, L.P. WASTEQUIP INC: Working to Refinance Debt as Maturities Approach --------------------------------------------------------------- Dow Jones' Daily Bankruptcy Review reports that Wastequip Inc. is seeking to refinance a credit agreement that comes due in the next 14 months, a tough task for the maker of waste-handling equipment, which is burdened with heavy debt and challenging market conditions for its products, said analysts. Wastequip is the largest manufacturer of waste handling and recycling equipment used to collect, process, and transport solid and liquid waste in North America. Revenues for the twelve months ending September 30, 2009, exceeded $300 million. As reported in the Troubled Company Reporter on Oct. 3, 2011, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit and senior secured issue-level ratings, on Wastequip Inc. to 'CCC-' from 'CCC'. The recovery rating on this debt remains unchanged at '3'. The outlook is negative. WORLD SURVEILLANCE: Files Form S-8; Registers 63.9-Mil. Shares -------------------------------------------------------------- World Surveillance Group Inc., formerly known as Sanswire Corp., filed with the U.S. Securities and Exchange Commission a Form S-8 registration statement registering 63.9 million shares of common stock to be offered under the 2004 Employee Stock Option Plan, 2011 Equity Compensation Incentive Plan and Non-Qualified Stock Options. A full-text copy of the Form S-8 prospectus is available for free at http://is.gd/22AjMd About World Surveillance World Surveillance Group Inc. designs, develops, markets and sells autonomous lighter-than-air (LTA) unmanned aerial vehicles (UAVs) capable of carrying payloads that provide persistent security and/or wireless communication from air to ground solutions at low, mid and high altitudes. The Company's airships, when integrated with electronics systems and other high technology payloads, are designed for use by government-related and commercial entities that require real-time intelligence, surveillance and reconnaissance or communications support for military, homeland defense, border control, drug interdiction, natural disaster relief and maritime missions. The Company is headquartered at the Kennedy Space Center, in Florida. The Company's balance sheet at June 30, 2011, showed $3.7 million in total assets, $17.9 million in total liabilities, and a stockholders' deficit of $14.2 million. Rosen Seymour Shapss Martin & Company LLP, in New York, expressed substantial doubt about Sanswire's ability to continue as a going concern, following the Company's results for the fiscal year ended Dec. 31, 2010. The independent auditor noted that the Company has experienced significant losses and negative cash flows, resulting in decreased capital and increased accumulated deficits. YELLOWSTONE MOUNTAIN: Federal Judge Dismisses Firm's Appeal ----------------------------------------------------------- A federal judge dismissed an appeal that would have confirmed a $40 million judgment against developer Tim Blixseth, the founder of the exclusive Yellowstone Club in Montana. In a significant victory for Mr. Blixseth, US District Court Judge Sam E. Haddon dismissed the appeal by the Yellowstone Club Liquidating Trust because the judgment is not final and is still a "moving target." In previous rulings, the Ninth Circuit Court of Appeals similarly refused to hear the appeal seeking to confirm the approximately $40 million judgment against Mr. Blixseth. "I've done nothing wrong and the judgment against me should be thrown out," Mr. Blixseth said. "More importantly, a recent Supreme Court decision makes clear that a lone bankruptcy court judge in Montana has no constitutional ability to decide matters like these," Mr. Blixseth added. Mr. Blixseth's legal team has consistently argued that his case clearly should never have been adjudicated by a US bankruptcy judge, without a jury and without the normal rules of civil discovery. Notably, the bankruptcy court in Montana initially forced Mr. Blixseth to go to trial only three weeks after he was sued for over $200 million. As the US Supreme Court made clear earlier this year in Stern v Marshall, bankruptcy courts have no constitutional authority to decide the very state law claims against Mr. Blixseth that the bankruptcy court did in Montana. Such matters should be handled instead by US District Courts, the Supreme Court ruled. "Stern v Marshall signaled the end of many years of allowing isolated bankruptcy judges to wield unbridled and unchecked judicial power in bankruptcy courts by trying cases that should have been tried by an independent judge," Mr. Blixseth said. "All I've ever wanted is a fair shake and an opportunity to lay out my case before a jury of my peers and an independent judge. That's what real justice is all about and that is what the Constitution requires. The judgment against me should be dismissed and the process started the right way, with fairness for all parties." On August 16, 2010, prior to the landmark Stern v Marshall ruling, US Bankruptcy Judge Ralph Kirscher ruled on his own in the Yellowstone Club bankruptcy case and issued the $40 million judgment against Blixseth. The club filed for bankruptcy protection in 2008, and was owned at the time by Mr. Blixseth's ex-wife and controlled by Sam Byrne of Cross Harbor Capital Partners of Boston. "All I ever did was borrow money from an aggressive lender, Credit Suisse, which promised the Yellowstone Club loan would never have recourse to me. Credit Suisse and one of its bondholders, Sam Byrne, have been behind the scenes in all of this litigation and ended up as partial owners of the Yellowstone Club at a fraction of its real worth. They and their partners weren't satisfied with just getting the club for a steal, they then fabricated a case against me. It's just one more example of the era of greed on Wall Street, as exposed in the award-winning documentary, 'Inside Job.'" About Yellowstone Club Located near Big Sky, Montana, Yellowstone Club -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Mountain Club LLC and its affiliates filed for Chapter 11 on Nov. 10, 2008 (Bankr. D. Mont. Case No. 08-61570). The Company's owner affiliate Edra D. Blixseth, filed for Chapter 11 on March 27, 2009 (Bankr. D. Mont. Case No. 09-60452). In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners, LLC, acquired equity ownership in the reorganized club for $115 million. Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC, represented the Debtors. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer, as counsel, and James H. Cossitt, Esq., at local counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. The Court entered an order confirming The Yellowstone Club's Chapter 11 Plan of Reorganization in June 2009. * 2011 Global Corp Default Tally Increases to 32 ------------------------------------------------ Three U.S.-based issuers defaulted this week, raising the 2011 global corporate default tally to 32, said an article published Thursday by Standard & Poor's Global Fixed Income Research, titled "Global Corporate Default Update (Sept. 29 - Oct. 5, 2011)." One of these defaulters, Real Mex Restaurants Inc., defaulted for the second time this year -- the first time in July after failing to make an interest payment and the second time this week after filing for Chapter 11 bankruptcy protection. Of the total defaulters this year, 23 are based in the U.S., three are based in New Zealand, two are in Canada, and one each is in the Czech Republic, France, Israel, and Russia. Of the defaulters by this time in 2010, 49 were U.S.-based issuers, nine were from the other developed region (Australia, Canada, Japan, and New Zealand), seven were from the emerging markets, and two were European issuers. Thirteen of this year's defaults were due to missed interest or principal payments and seven were due to distressed exchanges -- both of which were among the top reasons for defaults in 2010. Bankruptcy filings followed with six defaults, and regulatory actions accounted for three. Of the remaining defaults, one issuer had its banking license revoked by its country's central bank, another was appointed a receiver, and the third was confidential. By comparison, in 2010, 28 defaults resulted from missed interest or principal payments, 25 from Chapter 11 and foreign bankruptcy filings, 23 from distressed exchanges, three from receiverships, one from a regulatory directive, and one from administration. * Slowing Economy Poses Risks to 3 Most Stressed Sectors -------------------------------------------------------- Standard & Poor's Global Fixed Income Research has published its latest "Stress In Corporate America" report, in which we use three of our research publications -- weakest links, potential bond downgrades, and the distressed report -- to identify and spotlight U.S. sectors S&P believes are currently subject to the highest levels of credit stress. In light of sluggish consumer demand, a depressed construction market, and continued uncertainty about economic and credit market conditions, the media and entertainment, consumer products, and forest products/building materials sectors were, in our opinion, the most troubled sectors as of Sept. 29, 2011, according to the article published Friday, titled "Stress In Corporate America: The Slowing Economy Poses Risks To Recovery For The Three Most Stressed Sectors." These sectors had the highest levels of risk among our lists of distressed companies, weakest links, and potential bond downgrades. "We identified 113 companies in these three sectors that meet at least one of the criteria," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "Of the 113 companies, 27 are on more than one list, indicating even higher vulnerability." "Over the past 12 months, downgrades accounted for 54% of all rating actions in forest products and building materials, 49% in consumer products, and 46% in media and entertainment," said Ms. Vazza. "In comparison, 42% of rating actions for nonfinancial issuers were downgrades." * Missouri and Minnesota Banks Shuttered; Year's Failures Now 76 ---------------------------------------------------------------- Sun Security Bank, Ellington, Missouri, was closed Friday by the Missouri Division of Finance, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Great Southern Bank, Springfield, Missouri, to assume all of the deposits of Sun Security Bank. The RiverBank, Wyoming, Minnesota, was closed today by the Minnesota Department of Commerce, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Central Bank, Stillwater, Minnesota, to assume all of the deposits of The RiverBank. The FDIC estimates that the failures of the two banks will cost $190 million to its deposit insurance fund. 2011 Failed Banks List The FDIC was appointed as receiver for the closed banks. To protect the depositors, the FDIC entered into a purchase and assumption agreement with various banks that agreed to assume the deposits of most of the closed banks. The FDIC also entered into loss-share transactions on assets bought by the banks. For this year, the failed banks are: Loss-Share Transaction Party FDIC Cost Assets of Bank That Assumed to Insurance Closed Bank Deposits & Bought Fund Closed Bank (millions) Certain Assets (millions) ----------- ----------- ----------------- ------------ Sun Security Bank $355.9 Great Southern Bank $118.3 The RiverBank $417.4 Central Bank $71.4 First International Bank $239.9 American First Nat'l $53.8 Citizens Bank of N. Ca. $288.8 Tri Counties Bank $37.2 Bank of the Commonwealth $985.1 Southern Bank and Trust $268.3 First Nat'l Bank, Fla. $296.8 CharterBank $46.9 CreekSide Bank $102.3 Georgia Commerce Bank $27.3 Patriot Bank of Georgia $150.8 Georgia Commerce Bank $44.4 First Choice Bank Geneva $141.0 Inland Bank & Trust $31.0 First Southern Nat'l $164.6 Heritage Bank of the South $39.6 Lydian Private Bank $1,700.0 Sabadell United Bank $293.2 Public Savings Bank $46.8 Capital Bank, N.A. $11.0 1st Nat'l Bank of Olathe $538.1 Enterprise Bank & Trust $116.6 Bank of Whitman $548.6 Columbia State Bank $134.8 Bank of Shorewood $110.7 Heartland Bank and Trust $25.6 Integra Bank $2,200.0 Old National Bank $170.7 BankMeridian, N.A. $239.8 SCBT N.A. $65.4 Virginia Business $95.8 Xenith Bank $17.3 Bank of Choice $1,070.0 Bank Midwest, N.A. $213.6 LandMark Bank of Fla. $275.0 American Momentum $34.4 Southshore Community $46.3 American Momentum $8.3 Summit Bank $72.0 The Foothills Bank $11.3 First Peoples Bank $228.3 Premier American Bank $7.4 One Georgia Bank $186.3 Ameris Bank $44.4 High Trust Bank $192.5 Ameris Bank $66.0 Colorado Capital $717.5 First-Citizens Bank $283.8 First Chicago Bank $959.3 Northbrook Bank $284.3 Signature Bank $66.7 Points West Community $22.3 Mountain Heritage $103.7 First American Bank $41.1 First Commercial Bank $98.6 Stonegate Bank $28.5 McIntosh State Bank $339.9 Hamilton State Bank $80.0 Atlantic Bank and Trust $208.2 First Citizens Bank $36.4 First Heritage Bank $173.5 Columbia State $34.9 First Georgia Banking $731.0 CertusBank $156.5 Atlantic Southern $741.9 CertusBank $273.5 Summit Bank $142.7 Columbia State $15.7 Coastal Bank $129.4 Premier American Bank $13.4 Community Central $476.3 Talmer Bank & Trust $183.2 The Park Avenue Bank $953.3 Bank of the Ozarks $306.1 Cortez Community Bank $70.9 Florida Community Bank $18.6 First National Bank $352.0 Florida Community Bank $42.9 First Choice Community $308.5 Bank of the Ozarks $92.4 Heritage Banking $224.0 Trustmark National $49.1 Rosemount National $37.6 Central Bank $3.6 Nexity Bank $793.7 AloStar Bank of Commerce $175.4 New Horizons Bank $110.7 Citizens South Bank $30.9 Bartow County Bank $330.2 Hamilton State Bank $69.5 Superior Bank $3,000.0 Superior Bank, N.A. $259.6 Nevada Commerce Bank $144.9 City National Bank $31.9 Western Springs $186.8 Heartland Bank $31.0 Bank of Commerce $163.1 Advantage National $41.9 Legacy Bank $190.4 Seaway Bank and Trust $43.5 First Nat'l Bank of Davis $90.2 The Pauls Valley National $26.5 Valley Community Bank $123.8 First State Bank $22.8 Citizens Bank $214.3 Heritage Bank $59.4 San Luis Trust $332.6 First California $96.1 Habersham Bank $387.6 SCBT National $90.3 Charter Oak Bank $120.8 Bank of Marin $21.8 Sunshine State $125.5 Premier American $30.0 Badger State Bank $83.8 Royal Bank $17.5 Canyon National $210.9 Pacific Premier Bank $10.0 Peoples State Bank $390.5 First Michigan Bank $87.4 American Trust Bank $238.2 Renasant Bank $71.5 Community First $51.1 Northbrook Bank $11.7 North Georgia Bank $153.2 BankSouth $35.2 First Community Bank $2,310.0 U.S. Bank, N.A. $260.0 FirsTier Bank $781.5 No Acquirer $242.6 Evergreen State $246.5 McFarland State $22.8 The First State Bank $43.5 Bank 7 $20.1 The Bank of Asheville $195.1 First Bank $56.2 CommunitySouth Bank $440.6 Certus Bank $46.3 Enterprise Banking $100.9 [No Acquirer] $39.6 United Western Bank $2,050.0 First-Citizens Bank $312.8 Oglethorpe Bank $230.6 Bank of the Ozarks $80.4 Legacy Bank, Arizona $150.6 Enterprise Bank & Trust $27.9 First Commercial Bank $598.5 First Southern Bank $78.0 In 2010, there were 157 failed banks, compared with 140 in 2009 and just 25 for 2008. A complete list of banks that failed since 2000 is available at: http://www.fdic.gov/bank/individual/failed/banklist.html 865 Banks in Problem List The Federal Deposit Insurance Corp.'s list of "problem" banks fell in the second quarter 2011 for the first time since 2006 as the industry's income improved and costs tied to bad loans eased. The confidential list of banks deemed at greater risk of collapse shrank by 23 firms to 865, the FDIC said Aug. 23 in its Quarterly Banking Profile. The last time that happened was the third quarter of 2006 before the credit crisis began, the agency said. The FDIC defines "problem" institutions as those with financial, operational or managerial weaknesses that threaten their viability. The deposit insurance fund, which protects customer holdings up to $250,000 per account in the event of a failure, was positive for the first time in two years, the agency said. The fund rose to $3.9 billion, because of fewer expected bank failures and assessment revenue, the agency said. The FDIC insures deposits at more than 7,500 banks and thrifts. Problem Institutions Failed Institutions -------------------- ------------------- Year Number Assets (Mil) Number Assets (Mil) ---- ------ ------------ ------ ------------ 2010 884 $390,017 157 $92,085 2009 702 $402,800 140 $169,700 2008 252 $159,405 25 $371,945 2007 76 $22,189 3 $2,615 2006 50 $8,265 0 $0 2005 52 $6,607 0 $0 2004 80 $28,250 4 $170 Federal regulators assign a composite rating to each financial institution, based upon an evaluation of financial and operational criteria. The rating is based on a scale of 1 to 5 in ascending order of supervisory concern. "Problem" institutions are those institutions with financial, operational, or managerial weaknesses that threaten their continued financial viability. Depending upon the degree of risk and supervisory concern, they are rated either a "4" or "5." The number and assets of "problem" institutions are based on FDIC composite ratings. Prior to March 31, 2008, for institutions whose primary federal regulator was the OTS, the OTS composite rating was used. * Insurer Must Pay Bankrupt Manufacturer's Asbestos Claims ---------------------------------------------------------- Liz Hoffman at Bankruptcy Law360 reports that Transport Insurance Corp. is on the hook for millions of dollars in asbestos-related health claims after an Illinois federal judge ruled that it could not skirt a provision in its policy held by a bankrupt materials manufacturer. According to Law360, U.S. District Judge Sharon Johnson Coleman partially granted Artra 524(g) Asbestos Trust's request for summary judgment, ruling that Transport Insurance must pay the full amount of any health claims, rather than simply covering the pennies on the dollar the trust can afford to pay claimants. * Avenue Holds Second Close on European Distress Fund ----------------------------------------------------- Dow Jones' DBR Small Cap reports that Avenue Capital Group has held a second close on its latest European special situations fund at $1.1 billion, said people familiar with the situation. * BOND PRICING -- For Week From Oct. 3 to Oct. 7, 2011 ------------------------------------------------------ Company Coupon Maturity Bid Price ------- ------ -------- --------- ACARS-GM 8.100 6/15/2024 1.000 AHERN RENTALS 9.250 8/15/2013 24.125 AMBAC INC 9.375 8/1/2011 10.000 AMBAC INC 9.500 2/15/2021 15.000 AMBAC INC 7.500 5/1/2023 12.500 AMBAC INC 5.950 12/5/2035 10.000 AMBAC INC 6.150 2/7/2087 0.200 AMERICAN ORIENT 5.000 7/15/2015 53.346 AMR CORP 9.200 1/30/2012 90.000 AMR CORP 9.000 8/1/2012 82.850 BANK NEW ENGLAND 8.750 4/1/1999 14.000 BANK NEW ENGLAND 9.875 9/15/1999 14.000 BANKUNITED FINL 3.125 3/1/2034 7.100 BLOCKBUSTER INC 11.750 10/1/2014 2.125 BROADVIEW NETWRK 11.375 9/1/2012 73.080 CAPMARK FINL GRP 5.875 5/10/2012 50.500 CIRCUS & ELDORAD 10.125 3/1/2012 83.000 CITICORP 7.250 10/15/2011 99.900 DIRECTBUY HLDG 12.000 2/1/2017 31.000 DIRECTBUY HLDG 12.000 2/1/2017 35.625 DUNE ENERGY INC 10.500 6/1/2012 48.100 DYNEGY HLDGS INC 8.750 2/15/2012 78.058 EASTMAN KODAK CO 7.250 11/15/2013 49.250 EDDIE BAUER HLDG 5.250 4/1/2014 6.750 ENERGY CONVERS 3.000 6/15/2013 41.000 EOP OPERATING LP 5.000 10/15/2011 98.250 EVERGREEN SOLAR 4.000 7/15/2013 1.000 EVERGREEN SOLAR 13.000 4/15/2015 50.000 EVERGREEN SOLAR 4.000 7/15/2020 13.000 FAIRPOINT COMMUN 13.125 4/1/2018 1.000 FAIRPOINT COMMUN 13.125 4/2/2018 1.250 FRIENDLY ICE CR 8.375 6/15/2012 27.525 GLB AVTN HLDG IN 14.000 8/15/2013 85.100 GLOBALSTAR INC 5.750 4/1/2028 59.750 GMAC LLC 6.750 10/15/2011 99.429 GREAT ATLA & PAC 6.750 12/15/2012 22.000 HARTFORD FINL 5.250 10/15/2011 100.000 HAWKER BEECHCRAF 8.500 4/1/2015 41.000 HAWKER BEECHCRAF 9.750 4/1/2017 27.000 HORIZON LINES 4.250 8/15/2012 69.000 INTL LEASE FIN 5.000 10/15/2011 99.665 INTL LEASE FIN 5.250 10/15/2011 99.010 K HOVNANIAN ENTR 6.250 1/15/2015 60.000 K HOVNANIAN ENTR 6.250 1/15/2016 38.160 K HOVNANIAN ENTR 7.500 5/15/2016 30.000 KELLWOOD CO 7.625 10/15/2017 29.000 LEHMAN BROS HLDG 6.000 7/19/2012 22.000 LEHMAN BROS HLDG 3.000 10/28/2012 25.125 LEHMAN BROS HLDG 3.000 11/17/2012 24.250 LEHMAN BROS HLDG 5.000 1/22/2013 23.125 LEHMAN BROS HLDG 5.625 1/24/2013 22.000 LEHMAN BROS HLDG 5.100 1/28/2013 22.500 LEHMAN BROS HLDG 5.000 2/11/2013 23.000 LEHMAN BROS HLDG 4.800 2/27/2013 23.125 LEHMAN BROS HLDG 4.700 3/6/2013 22.500 LEHMAN BROS HLDG 5.000 3/27/2013 21.000 LEHMAN BROS HLDG 5.750 5/17/2013 23.000 LEHMAN BROS HLDG 5.250 1/30/2014 23.125 LEHMAN BROS HLDG 4.800 3/13/2014 23.000 LEHMAN BROS HLDG 5.000 8/3/2014 23.125 LEHMAN BROS HLDG 6.200 9/26/2014 23.375 LEHMAN BROS HLDG 5.150 2/4/2015 23.125 LEHMAN BROS HLDG 5.250 2/11/2015 22.500 LEHMAN BROS HLDG 8.800 3/1/2015 22.000 LEHMAN BROS HLDG 7.000 6/26/2015 22.500 LEHMAN BROS HLDG 8.500 8/1/2015 23.500 LEHMAN BROS HLDG 5.000 8/5/2015 20.250 LEHMAN BROS HLDG 7.000 12/18/2015 20.800 LEHMAN BROS HLDG 5.500 4/4/2016 23.000 LEHMAN BROS HLDG 5.875 11/15/2017 23.375 LEHMAN BROS HLDG 5.600 1/22/2018 22.000 LEHMAN BROS HLDG 5.700 1/28/2018 22.000 LEHMAN BROS HLDG 5.500 2/4/2018 22.500 LEHMAN BROS HLDG 5.550 2/11/2018 22.250 LEHMAN BROS HLDG 6.000 2/12/2018 23.125 LEHMAN BROS HLDG 5.350 2/25/2018 21.875 LEHMAN BROS HLDG 6.875 5/2/2018 24.000 LEHMAN BROS HLDG 8.050 1/15/2019 22.000 LEHMAN BROS HLDG 7.000 4/16/2019 21.750 LEHMAN BROS HLDG 8.500 6/15/2022 20.000 LEHMAN BROS HLDG 11.000 6/22/2022 23.375 LEHMAN BROS HLDG 11.000 7/18/2022 22.750 LEHMAN BROS HLDG 11.500 9/26/2022 23.375 LEHMAN BROS HLDG 9.500 12/28/2022 21.750 LEHMAN BROS HLDG 9.500 1/30/2023 21.875 LEHMAN BROS HLDG 8.400 2/22/2023 21.500 LEHMAN BROS HLDG 9.500 2/27/2023 22.250 LEHMAN BROS HLDG 9.000 3/7/2023 19.775 LEHMAN BROS HLDG 10.000 3/13/2023 22.500 LEHMAN BROS HLDG 18.000 7/14/2023 25.750 LEHMAN BROS HLDG 10.375 5/24/2024 22.000 LEHMAN BROS HLDG 11.000 3/17/2028 25.497 LEHMAN BROS INC 7.500 8/1/2026 15.000 LENNAR CORP 5.950 10/17/2011 100.125 LIFEPT VILGE 8.500 3/19/2013 49.500 LOCAL INSIGHT 11.000 12/1/2017 2.250 MAJESTIC STAR 9.750 1/15/2011 5.000 MANNKIND CORP 3.750 12/15/2013 53.250 MOHEGAN TRIBAL 8.000 4/1/2012 60.200 MOHEGAN TRIBAL 6.125 2/15/2013 53.000 MOHEGAN TRIBAL 7.125 8/15/2014 43.700 MOHEGAN TRIBAL 6.875 2/15/2015 43.670 MP SUSQUEH-CALL 9.875 5/15/2014 100.813 NBC ACQ CORP 11.000 3/15/2013 1.000 NEBRASKA BOOK CO 10.000 12/1/2011 91.000 NEBRASKA BOOK CO 8.625 3/15/2012 43.750 NEWPAGE CORP 12.000 5/1/2013 1.980 NVE-CALL11/11 6.750 8/15/2017 102.100 OCR-CALL10/11 6.875 12/15/2015 103.375 PENSON WORLDWIDE 8.000 6/1/2014 44.248 PMI CAPITAL I 8.309 2/1/2027 9.000 RESTAURANT CO 10.000 10/1/2013 22.550 RIVER ROCK ENT 9.750 11/1/2011 71.000 SBARRO INC 10.375 2/1/2015 1.000 TEXAS COMP/TCEH 7.000 3/15/2013 29.000 TEXAS COMP/TCEH 10.250 11/1/2015 37.625 TEXAS COMP/TCEH 10.250 11/1/2015 37.500 TEXAS COMP/TCEH 10.250 11/1/2015 34.000 THORNBURG MTG 8.000 5/15/2013 6.000 TIMES MIRROR CO 7.250 3/1/2013 35.000 TOUSA INC 9.000 7/1/2010 19.500 TRAILER BRIDGE 9.250 11/15/2011 88.900 TRAVELPORT LLC 11.875 9/1/2016 40.000 TRAVELPORT LLC 11.875 9/1/2016 39.875 TRICO MARINE 3.000 1/15/2027 4.000 TRICO MARINE SER 8.125 2/1/2013 4.000 VIRGIN RIVER CAS 9.000 1/15/2012 51.000 WCI COMMUNITIES 7.875 10/1/2013 0.400 WCI COMMUNITIES 4.000 8/5/2023 1.570 WESCO INTL 1.750 11/15/2026 89.000 WILLIAM LYON INC 10.750 4/1/2013 18.250 WILLIAM LYON INC 7.500 2/15/2014 17.000 WILLIAM LYONS 7.625 12/15/2012 23.000 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers" public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, Joseph Medel C. Martirez, Denise Marie Varquez, 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 ***