/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/120124.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, January 24, 2012, Vol. 16, No. 23 Headlines ABITIBIBOWATER INC: Resolute Extends Offer for Fibrek to Feb. 13 AGY HOLDING: Enters Into Employment Employment with Drew Walker ALCO CORPORATION: Sec. 341 Creditors' Meeting Set for Feb. 10 ALCO CORPORATION: Hires Carmen D. Conde Torres as Counsel ALCO CORPORATION: Taps Jimenez as Accountants ALLEN CAPITAL: DLH Master's Plan Effective Date Occurred Dec. 15 ALLIED DEFENSE: Howard Golden Discloses 10.2% Equity Stake AMERICAN DENTAL: S&P Assigns 'B' Corporate Credit Rating AMERICAN EAGLE: Shut by Regulators; Capital Bank Assumes Deposits AMERICAN MARINE: Self-Appointed Manager Objects to its Bankruptcy APPLETON PAPERS: James Tyrone Resigns as Senior Vice President BARBETTA LLC: Bankr. Administrator Has Objections to Plan BIG WHALE: Plan of Reorganization Declared Effective B.R. SUMMERLIN: Plan of Reorganization Declared Effective CAMTECH PRECISION: Court Gives R&J Until Feb. 4 to File Plan CAMTECH PRECISION: Avstar Wants More Time to Solicit Plan Votes CAPITOL BANCORP: Four Proposals Rejected at Annual Meeting CARPENTER CONTRACTORS: Plan Outline Hearing Adjoined Until Feb. 13 CATALYST PAPER: Hearing on Recapitalization Set on Feb. 3 CATALYST PAPER: Third Avenue Discloses 28.3% Equity Stake CENTRAL FEDERAL: Annual Stockholders Meeting Set for May 17 CDC CORP: Court OKs Kobre & Kim to Handle Evolution Matters CDC CORP: Equity Committee Taps Morgan Joseph as Fin'l Advisor CENTURY PLAZA: Has Interim Access to Cash Collateral Until Feb. 29 CITIZENS CORP: Files Plan to Pay Tennessee Commerce in Full CLAIRE'S STORES: Bank Debt Trades at 11% Off in Secondary Market CLARE OAKS: Opposes Appointment of Patient Care Ombudsman CLARE OAKS: Wants to Hire George Mesires as Bankruptcy Counsel CLEAN BURN: Bankruptcy Administrator Pushes Ch. 7 Liquidation CLEAR CHANNEL: Bank Debt Trades at 22% Off in Secondary Market CYBEX INTERNATIONAL: Receives Add'l Nasdaq Non-Compliance Notice DALLAS ROADSTER: Gets Final Court OK on $400,000 Bankruptcy Loan D.C. DEVELOPMENT: Court OKs Cole Schotz as Committee's Counsel D.C. DEVELOPMENT: Taps Maloney and Associates as Accountants D.C. DEVELOPMENT: Proposes Non-Debtor Affiliate as Broker DELTA PETROLEUM: Court Approves Hughes Hubbard as Counsel DELTA PETROLEUM: Court OKs Morris Nichols as Local Counsel DEX MEDIA WEST: Bank Debt Trades at 44% Off in Secondary Market DS WATERS: Moody's Assigns 'B1' Rating to Proposed Term Loans EASTMAN KODAK: Proposes $950-Mil. of DIP Financing EASTMAN KODAK: Proposes to Continue Using Cash Collateral EASTMAN KODAK: Schedules Deadline Extended to March 19 EASTMAN KODAK: Trustee for UK-Kodak Pension Expected to File Claim EASTMAN KODAK: Meeting to Form Creditors' Panel on Jan. 25 EASTMAN KODAK: Moody's Cuts Probability of Default Rating to 'D' EASTMAN KODAK: Court OKs $650-Mil. of Loans on Interim EASTMAN KODAK: Brighton Securities Lists 5 Things You Need to Know EUROCLASS MOTORS: Has Until Jan. 30 to Propose Chapter 11 Plan EVERGREEN SOLAR: Lenders Claim $70.3MM Decline in Collateral Value EVERGREEN SOLAR: Has Preliminary Settlement on Contested Claims FERTITTA MORTON: Moody's Assigns 'B2' Rating to Term Loan FILENE'S BASEMENT: Files Schedules of Assets and Liabilities FILENE'S BASEMENT: Syms Files Schedules of Assets & Liabilities FILENE'S BASEMENT: Committee Retains Abacus as Consultants FILENE'S BASEMENT: Equity Committee Retains RCS as Consultant FILENE'S BASEMENT: Allowed to Hire BDO USA as Accountants FILENE'S BASEMENT: Court OKs Hilco as Real Estate Consultant FILENE'S BASEMENT: Hilco Streambank OK'd as IP Consultant FIRST STATE: Closed; Hamilton State Bank Assumes All Deposits FLORIDA STATE BANK: Closed; CenterState Bank Assumes All Deposits FRIENDLY ICE: Court OKs Sale of All Assets to Sundae Group FURNITURE BY THURSTON: Files Schedules of Assets and Liabilities GAS CITY: Settles With BofA; Chapter 11 Case Dismissed GATEHOUSE MEDIA: Bank Debt Trades at 76% Off in Secondary Market GENERAL MARITIME: Files Schedules of Assets and Liabilities GSC GROUP: BDCM Files 4th Amended Plan, Gets Trustee Support GSW HOLDINGS: Must Pay Hancock on Sales of Hunter Chase Lots HABERSHAM BANCORP: Knight Capital Discloses 5.6% Equity Stake HANMI FINANCIAL: Posts $5.5 Million Net Income in Fourth Quarter HAYDEL PROPERTIES: Sec. 341 Creditors' Meeting Set for Feb. 17 HERCULES OFFSHORE: Bank Debt Trades at 2% Off in Secondary Market HERTZ CORP: Fitch Affirms 'BB-' Long-Term Issuer Default Rating HILEX POLY: S&P Affirms 'B' Corporate Credit Rating HOVENSA LLC: Fitch to Finish Review on Bond Ratings in February GOOD SAM: Offers to Purchase $7.4 Million 11.50% Senior Notes HOVENSA LLC: Moody's Affirms 'Ba2' Corporate Family Rating HUSSEY COPPER: Court Sets Feb. 29 as General Claims Bar Date INDIANA HEALTH: Fitch Raises Rating on Two Bonds From 'BB+' INGALLS INDUSTRIES: Fitch Affirms 'BB' Issuer Default Rating IOWA RENEWABLE: Posts $4.8 Million Net Loss in Fiscal 2011 JEFFERSON COUNTY: Bondholders, Receiver Appeal on Sewers' Control KLN STEEL: Committee Wants to Retain Hall Attorneys as Counsel KLN STEEL: Wants to Hire Horwood Marcus as Special Counsel KLN STEEL: Court Approves Jackson Walker as Attorneys LEE ENTERPRISES: To Complete Chapter 11 Process Jan. 30 LEHMAN BROTHERS: Seeks to Exercise First Offer Right in Archstone LEHMAN BROTHERS: Seeks Estimation of LB Finance, et al., Claims LEHMAN BROTHERS: Wins Nod to Sell Stake in Wilpon for $390MM LEHMAN BROTHERS: Wins OK to Stay Suits Seeking $3-Billion LEHMAN BROTHERS: Seeks to Sanction Two SPV Issuers LOS ANGELES DODGERS: Files Sale-Based Reorganization Plan LOS ANGELES DODGERS: Can Hire Deloitte as Tax Services Provider MACCO PROPERTIES: Trustee Can Hire Andrew Schmidt as Accountant MAXIM CRANE: Moody's Downgrades CFR/PDR to Caa1; Outlook Stable MC2 CAPITAL: Wants to Incur Unsecured Loan from Shaw Capital MEDICAL INTERNATIONAL: To Seek New Distributors Worldwide MONTANA ELECTRIC: Committee Taps Harold Dye as Attorney MOONLIGHT BASIN: Ranch Closes Sale to Lehman Brothers NATIONAL HOLDINGS: Incurs $4.7 Million Net Loss in Fiscal 2011 NATIONAL RETAIL: Fitch Affirms Rating on Preferred Stock at 'BB+' NATIVE WHOLESALE: Court Sets Feb. 10 as Claims Bar Date NEVADA CANCER: Committee Taps Pachulski Stang as Counsel NEVADA CANCER: Committee Taps Schwartzer as Local Counsel NEWELL RUBBERMAID: Fitch Affirms Rating on 5.25% QUIPS at 'BB+' NPC INT'L: Moody's Says 'B2' CFR Unaffected by Acquisition NUTRACEA: Completes Two Fund Raising Deals, Adds New Board Member NUTRACEA: Makes Final Payments Under Plan of Reorganization OPEN RANGE: Wants to Employ Anton Collins as Tax Advisor ORCHARD SUPPLY: Moody's Confirms CFR at 'B3', Outlook Negative PACESETTER FABRICS: OK'd to Use Cash Collateral Until March 16 PEAK BROADCASTING: Taps Sheppard Mullin as Chapter 11 Counsel PEAK BROADCASTING: Taps Pachulski as Local Bankruptcy Counsel PEAK BROADCASTING: Taps Edinger as Counsel to FCC Matters PEAK BROADCASTING: Seeks Approval to Transfer FCC Licenses PENDLETON COUNTY: S&P Cuts Rating on Series 1993B Bonds to 'B' PENINSULA HOSPITAL: Wants Plan Filing Deadline Extended to Feb. 17 PINNACLE AIRLINES: Chief Executive Says Bankruptcy is Possible PONTIAC, MI: Fitch Affirms Rating on Two Revenue Bonds at Low-B POTOMAC SUPPLY: Files for Chapter 11 Due to Funding Woes POTOMAC SUPPLY: Case Summary & 20 Largest Unsecured Creditors PRIUM SPOKANE: Trustee Retracts Case Conversion, Dismissal Plea PURE BEAUTY: Has Until May 1 to File Bankruptcy Plan RADIOSHACK CORP: Moody's Cuts Corp. Family Rating to 'Ba2' RANCHO LAS FLORES: San Bernardino Land Owner Files for Chapter 11 RANCHO LAS FLORES: Case Summary & 6 Largest Unsecured Creditors REALOGY CORP: Bank Debt Trades at 11% Off in Secondary Market SAKS INC: Moody's Lifts Corporate Family Rating to 'Ba3' SCHOMAC GROUP: Hearing on LNV Corp.'s Cash Continued Until Feb. 7 SCHOMAC GROUP: Hearing on Plan Outline Adequacy Set for Feb. 7 SEARS HOLDINGS: Talking to Factors; Ed Lampert Takeover Seen SEQUENOM INC: Selling 13 Million Common Shares at $4.15 Apiece SHOPPES OF LAKESIDE: March 9 Hearing on Dismissal Motion Set SHOPPES OF LAKESIDE: Will Seek Plan Approval at March 21 Hearing SIGNAL HILL: Court Converts Chapter 11 Case to One Under Chapter 7 SILVERSUN TECHNOLOGIES: Inks Exchange Pact with SWK Shareholders SOUTH OF THE STADIUM: Providence Asks Court to Deny Confirmation SOUTHERN MONTANA: Hearing on Access to Lender's Cash Set for Today SP NEWSPRINT: Court OKs Ashby & Geddes as Comm. Local Counsel SP NEWSPRINT: Court OKs BDO as Committee's Financial Advisor SPECTRAWATT INC: Will Seek Approval of Plan at Jan. 25 Hearing SQUARETWO FINANCIAL: Moody's Affirms Corp. Family Rating at 'B2' STONER AND CO: Sec. 341 Creditors' Meeting Set for Feb. 16 STONER AND CO: Chapter 11 Case Conference Set for Feb. 16 SUMMO INC: Creditors Have Until Feb. 6 to File Proofs of Claims SUPERMEDIA INC: Files Q4 Post-Confirmation Quarterly Report TEXAS COMPETITIVE: S&P Keeps 'CCC' Issuer Credit Rating TRAILER BRIDGE: Unsecured Creditors to Receive 25%-85% Recovery TRIBUNE CO: Bank Debt Trades at 37% Off in Secondary Market TRONOX INC: Kerr-McGee and Anadarko Fail to Get Damages Cap TXU CORP: Bank Debt Trades at 41% Off in Secondary Market TXU CORP: Bank Debt Trades at 37% Off in Secondary Market VEGAS INC: Sec. 341(a) Creditors' Meeting Set for Feb. 13 VEGAS INC: Initial Status Conference Set for Feb. 13 VEGAS INC: Files List of 6 Largest Unsecured Creditors WASHINGTON MUTUAL: Feb. 16 Hearing on Ex-Officers' Deal With FDIC WESTERN ENERGY: Moody's Assigns 'B2' Corporate Family Rating WILLIAM LYON: Gets Final OK to Access $30-Mil. Bankruptcy Loan WESTLAND PARCEL: Can Use Cash Collateral Til Jan. 31 WJO INC: Can Use Tristate Cash Collateral Thru Jan. 31 * Kodak Filing Leads to Increase in Liquidity-Stress Index * Recovery of U.S. Auto Makers, Suppliers Leads to Job Gains * NACBA Outlines Initiatives Planned on Ethnicity, Ch. 11 Filings * Large Companies With Insolvent Balance Sheets ********* ABITIBIBOWATER INC: Resolute Extends Offer for Fibrek to Feb. 13 ---------------------------------------------------------------- AbitibiBowater Inc., doing business as Resolute Forest Products, extended to Feb. 13, 2012, the expiry date for its offer to acquire all the issued and outstanding common shares of Fibrek Inc. The extension is intended to allow the Canadian Competition Bureau to complete its review of the proposed acquisition following its request for supplementary information and the Bureau de revision et decision to hear Resolute's application for an order to cease trade the Fibrek shareholder rights plan. "A supplementary information request is a normal part of the regulatory process," said Richard Garneau, President and Chief Executive Officer. "We will continue to work with the Canadian competition authority and provide it with the responsive information." He added: "We're pleased to see that over 57% of Fibrek shares have been tendered as of today. The success of our bid should be up to shareholders, unimpeded by management entrenchment maneuvers like the tactical poison pill." Fibrek shareholders should consider the following factors in making their decision to accept the offer: * The offer represents a substantial premium to Fibrek's pre- announcement trading price; * The offer is not subject to any financing condition; * Fibrek shareholders have the opportunity to exchange their shares of Fibrek, which had been thinly traded through to the date the offer was announced; * Resolute is uniquely positioned to integrate Fibrek into its existing operations; Fibrek shareholders who become Resolute shareholders will own shares in a company that: -- is financially stronger; -- has a diversified asset and product base; -- is determined to continue improving the competitive position of its mills by focusing on cost optimization; -- maintains a prudent capital structure, with a ratio of long- term debt to last twelve months adjusted EBITDA of 1.3x as of the end of the third quarter of 2011. The offer, which Resolute is making together with RFP Acquisition Inc., a wholly-owned subsidiary, is more fully described in the offer circular and other ancillary documentation the Company filed on Dec. 15, 2011, on the Canadian Securities Administrators' website, as amended by notice of variation on January 9 and on January 20. The offer will expire at 5:00 p.m. (Eastern Standard Time) on Feb. 13, 2012, unless it is extended or withdrawn by Resolute. As of the close of market on January 20, approximately 74.25 million common shares of Fibrek had been tendered to the offer, representing approximately 57.1% of the outstanding common shares. About AbitibiBowater Inc. AbitibiBowater Inc. -- http://www.abitibibowater.com/-- owns or operates 18 pulp and paper mills and 24 wood products facilities located in the United States, Canada and South Korea. Marketing its products in more than 70 countries, AbitibiBowater is also among the largest recyclers of old newspapers and magazines in North America, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade under the stock symbol ABH on both the New York Stock Exchange and the Toronto Stock Exchange. The Company and several of its affiliates filed for protection under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr. D. Del. Lead Case No. 09-11296). The Company and its Canadian affiliates commenced parallel restructuring proceedings under the Companies' Creditors Arrangement Act before the Quebec Superior Court Commercial Division the next day. Alex F. Morrison at Ernst & Young, Inc., was appointed CCAA monitor. Paul, Weiss, Rifkind, Wharton & Garrison LLP, served as the Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acted as the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, served as the Debtors' co-counsel, while Troutman Sanders LLP in New York, served as the Debtors' conflicts counsel in the Chapter 11 proceedings. The Debtors' financial advisors were Advisory Services LP, and their noticing and claims agent was Epiq Bankruptcy Solutions LLC. The CCAA Monitor's counsel was Thornton, Grout & Finnigan LLP, in Toronto, Ontario. Luc A. Despins, Esq., at Paul, Hastings, Janofsky & Walker LLP, in New York, served as counsel to the Official Committee of Unsecured Creditors. Jamie L. Edmonson, Esq., GianClaudio Finizio, Esq., and Daniel A. O'Brien, Esq., at Bayard, P.A., in Wilmington, Delaware, served as local counsel to the Creditors Committee. Abitibi-Consolidated Inc. and various Canadian subsidiaries filed for protection under Chapter 15 of the U.S. Bankruptcy Code on April 17, 2009 (Bankr. D. Del. 09-11348). Pauline K. Morgan, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, represented the Chapter 15 Debtors. U.S. Bankruptcy Judge Kevin Carey handled the Chapter 11 cases of AbitibiBowater Inc. and its U.S. affiliates and the Chapter 15 case of ACI, et al. The U.S. Bankruptcy Court issued an opinion confirming AbitibiBowater's chapter 11 plan of reorganization on Nov. 22, 2010. The Debtors also obtained approval of their reorganization plan under the Canadian Companies' Creditors Arrangement Act. AbitibiBowater emerged from bankruptcy on Dec. 9, 2010. AGY HOLDING: Enters Into Employment Employment with Drew Walker --------------------------------------------------------------- AGY Holding Corp. and its parent, KAGY Holding Company, Inc., entered into an employment agreement with Drew Walker, president and director of the Company. Under the terms of his employment agreement, Mr. Walker's annual base salary will be $350,000 and he will be eligible to receive a target annual bonus equal to 100% of annual base salary, subject to performance targets and the provisions of a management incentive plan. Mr. Walker will also be granted an option to acquire 280,000 shares of KAGY's common stock, subject to a four- year vesting schedule. In addition, the portion of Mr. Walker's existing option award granted in 2006 that is unvested has been accelerated such that Mr. Walker is fully vested in his option to purchase 120,000 shares of KAGY common stock that was granted in 2006. Mr. Walker will be entitled to participate in employee benefit plans for executives of the Company generally and will remain eligible for participation in the Company's severance plan, which provides for severance under certain circumstances. Mr. Walker will receive monthly apartment and car allowances and will be reimbursed for reasonable and necessary business expenses. In addition, Mr. Walker will be subject to certain non- compensation and non-solicitation restrictions following the termination of his employment as provided for in the employment agreement. About AGY Holding AGY Holding Corp. -- http://www.agy.com/-- produces fiberglass yarns and high-strength fiberglass reinforcements used in composites applications. AGY serves a range of markets including aerospace, defense, electronics, construction and industrial. Headquartered in Aiken, South Carolina, AGY has a European office in Lyon, France and manufacturing facilities in the U.S. in Aiken, South Carolina and Huntingdon, Pennsylvania and a controlling interest in a manufacturing facility in Shanghai, China. The Company reported a net loss of $14.57 million on $183.67 million of net sales for the year ended Dec. 31, 2010, compared with a net loss of $93.51 million on $153.85 million of net sales during the prior year. The Company reported a net loss of $21.10 million on $141.54 million of net sales for the nine months ended Sept. 30, 2011, compared with a net loss of $17.64 million on $140.44 million of net sales for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $294.72 million in total assets, $288.21 million in total liabilities, $233,000 in obligation under put/call for noncontrolling interest and $6.27 million in total shareholders' equity. * * * As reported by the TCR on Nov. 23, 2011, Moody's Investors Service lowered AGY Holding Corporation's (AGY) Corporate Family Rating (CFR) to Caa2 from B3, reflecting the decline in the company's liquidity and weak operating performance. In the Dec. 5, 2011, edition of the TCR, Standard & Poor's Ratings Services lowered its corporate credit rating on Aiken, S.C.-based AGY Holding Corp. (AGY) to 'CCC-' from 'CCC+'. "Our rating action reflects our view that AGY's credit quality has deteriorated due to ongoing weakness in its operating performance, a decline in liquidity, and the potential for insufficient liquidity to meet interest payments in 2012. As of Sept. 30, 2011, the company reported total liquidity of $17 million including $16.2 million of availability under its unrated revolving credit facility. AGY reported that it expected liquidity to decline to levels of around $12.4 million in November following the payment of nearly $10 million in semiannual interest on its notes. It also expects effective availability to be lower than the reported figures, because the company is also subject to a fixed-charge coverage ratio covenant if availability under its revolving credit facility declines to below $6.25 million. We do not expect to be in compliance if the covenant becomes applicable. Current liquidity levels have declined from our expectations of a minimum liquidity of $20 million at the previous rating. Key credit risks, in our view, are liquidity insufficient to meet requirements (including approximately $20 million in future interest payments in 2012). An additional risk is potential liquidity requirements possibly arising from the put option available with the seller of AGY Hong Kong Ltd. for the remaining 30% of the company not yet purchased by AGY. The put option can be exercised through Dec. 31, 2013. AGY reports a fair value of about $0.23 million for the remaining 30% of the AGY Hong Kong Ltd. as of Sept. 30, 2011 -- a decline from an initial estimated value of about $12 million in 2009. AGY Hong Kong also has about $10.5 million of debt, which the company reports it is trying to extend, and approximately $11.5 million in annually renewable working capital facilities due in 2012 (debt at AGY Hong Kong is nonrecourse to AGY)," S&P said. ALCO CORPORATION: Sec. 341 Creditors' Meeting Set for Feb. 10 ------------------------------------------------------------- Monsita Lecaroz Arribas of the Office of the U.S. Trustee in San Juan, Puerto Rico, will hold a meeting of creditors pursuant to Sec. 341(a) of the Bankruptcy Code in the Chapter 11 case of Alco Corporation on Feb. 10, 2012, at 9:00 a.m. at 341 Meeting Room, Ochoa Building, 500 Tanca Street, First Floor, San Juan. Proofs of claim are due in the case by May 10, 2012. Government proofs of claim are due by July 18, 2012. Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 12-00139) on Jan. 12, 2012. Carmen D. Conde Torres, Esq., at C. Conde & Associates, serves as the Debtor's counsel. It scheduled $11,200,030 in assets and $7,762,314 in debts. The petition was signed by Alfonso Rodriguez, president. ALCO CORPORATION: Hires Carmen D. Conde Torres as Counsel --------------------------------------------------------- Alco Corporation asks the Bankruptcy Court to approve its engagement of Carmen D. Conde Torres, Esq., and C. Conde & Associates as its Chapter 11 lawyer. Mrs. Conde Torres, Esq., a senior attorney at the firm, charges $300 an hour for her services. Associates at the firm bill $275 per hour while paralegals charge $150 per hour. The firm received a non-refundable retainer of $20,000 which was paid by Desarrolladora Los Filters Inc. The firm may be reached at: Carmen D. Conde Torres, Esq. C. CONDE & ASSOC. 254 San Jose Street, 5th Floor Old San Juan, Puerto Rico 00901 Tel: 787-729-2900 Fax: 787-729-2203 E-mail: condecarmen@microjuris.com About Alco Corp. Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 12-00139) on Jan. 12, 2012. It scheduled $11,200,030 in assets and $7,762,314 in debts. The petition was signed by Alfonso Rodriguez, president. Alco tapped Jimenez Vasquez & Associates, PSC, as accountants. ALCO CORPORATION: Taps Jimenez as Accountants --------------------------------------------- Alco Corporation seeks permission from the Bankruptcy Court to employ Jose Victor Jimenez, CPA, of Jimenez Vasquez & Associates, PSC, as accountants. The Debtor proposes to pay the firm $125 per hour. The firm has been provided a $7,000 retainer. Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 12-00139) on Jan. 12, 2012. Carmen D. Conde Torres, Esq., at C. Conde & Associates, serves as the Debtor's counsel. It scheduled $11,200,030 in assets and $7,762,314 in debts. The petition was signed by Alfonso Rodriguez, president. ALLEN CAPITAL: DLH Master's Plan Effective Date Occurred Dec. 15 ---------------------------------------------------------------- DLH Master Land Holding, LLC, notified the U.S. Bankruptcy Court for the Northern District of Texas that the Effective Date for the Amended and Restated Seventh Plan of Reorganization occurred on Dec. 15, 2011. The Court confirmed DLH Master's Plan on Nov. 23, 2011. Earlier in October, Bankruptcy Judge Harlin D. Hale confirmed the amended Fifth Joint Plan of Reorganization as to Allen Capital Partners LLC, and the Plan became effective Dec. 1, 2011. DLH Master's proposed Reorganization Plan contemplates that the Debtor will obtain sufficient Exit Financing to enable the Debtor to pay all administrative and non-tax priority claims in full on the effective date and to provide a standby line of credit for future operating cash flow needs for the Debtor. DLH, with the agreement of the DIP Lenders, will convert the DIP financing into a post-confirmation term loan. The current projected balance of the facility is approximately $2.72 Million. The Debtor has obtained additional Exit Financing approved by the Court. Certain Secured Claims will be satisfied on or shortly after the Effective Date by the surrender of the land securing such Secured Claims. Reorganized DLH will finance distributions to the other creditors from other sales of land, refinancing, Exit Financing and or joint ventures. The proceeds from any sale would be used first to pay necessary costs of closing, second, in payment of the Release Price necessary to satisfy in full the Secured Claim secured by such parcel, third, in payment of a Release Price on the Term Loan from the DIP Lenders, and fourth, payment of sufficient funds to allow the Debtor's owners to pay actual state and federal income taxes incurred as a result of the taxable gains realized on such a sale, if any resulting in the Net Sales Proceeds subject to Reorganized DLH being in compliance with all other terms of the Plan. The Net Sales Proceeds from any such sale will be allocated generally between Reorganized DLH and Creditors holding Allowed Claims against DLH: (a) to fund the operating expenses of Reorganized DLH, including the costs of managing and marketing the DLH Land and to repay the Term Loan and Other Exit Financing, and (b) to fund distributions to Creditors. A full-text copy of the Amended and Restated Plan is available for free at http://bankrupt.com/misc/DLH_MASTER_7thplan.pdf About Allen Capital Allen Capital Partners LLC and subsidiary DLH Master Land Holding LLC, are the developers of Dallas Logistics Hub, a 6,000-acre multimodal logistics park 12 miles (19 kilometers) from downtown Dallas. Allen Capital Partners, LLC, dba The Allen Group, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10- 30562) on Jan. 25, 2010. Mark MacDonald, Esq., at MacDonald + MacDonald, P.C., represents the Debtor. Lain, Faulkner & Co. is the Debtor's financial advisor. The Company disclosed $220,325,201 in assets and $160,622,236 in liabilities as of the Chapter 11 filing. The Debtor's affiliate -- DLH Master Land Holding, LLC, dba The Allen Group -- filed a separate Chapter 11 bankruptcy petition. Another affiliate, Visalia, California-based Richard S. Allen, Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D. Texas Case No. 10-33211) on May 3, 2010. Patrick J. Neligan, Jr., Esq., at Neligan Foley LLP, represents the Debtor. The Company disclosed $76,158,469 in assets and $53,728,982 in liabilities as of the petition date. An Official Committee of Unsecured Creditors has been appointed. Secured creditor BBVA Compass is represented by Kenneth Stohner, Jr., Esq., at Jackson Walker L.L.P. So-called Pool 2 and Pool 4 secured creditors are represented by Robert Yaquinto, Jr., Esq., at Sherman & Yaquinto, L.L.P. ALLIED DEFENSE: Howard Golden Discloses 10.2% Equity Stake ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Howard Golden and his affiliates disclosed that, as of June 7, 2011, they beneficially own 838,569 shares of common stock of Allied Defense Group, Inc., representing 10.2% of the shares outstanding. A full-text copy of the filing is available at: http://is.gd/oaVI8l About The Allied Defense Group Vienna, Va.-based The Allied Defense Group, Inc. (OTCQB: ADGI) -- http://www.allieddefensegroup.com/-- is a multinational defense business focused on the manufacture and sale of ammunition and ammunition related products for use by the U.S. and foreign governments. Allied's business is conducted by its two wholly owned subsidiaries: Mecar S.A. and Mecar USA, Inc. Mecar is located in Nivelles, Belgium and Mecar USA is located in Marshall, Texas. The Company received a subpoena from the U.S. Department of Justice on Jan. 19, 2010, requesting that the Company produce documents relating to its dealings with foreign governments. The Company said it is unlikely that any distributions to stockholders will be made until the matters relating to the DOJ subpoena have been resolved. The Company's consolidated statements of net assets as of Sept. 30, 2011, showed $47.80 million in total assets, $3.56 million in total liabilities, and $44.24 million in net assets in liquidation. Plan of Dissolution and Liquidation On June 24, 2010, the Company signed a definitive purchase and sale agreement with Chemring Group PLC pursuant to which Chemring agreed to acquire substantially all of the assets of the Company for $59,560 in cash and the assumption of certain liabilities. On Sept. 1, 2010, the Company completed the asset sale to Chemring contemplated by the Agreement. Pursuant to the Agreement, Chemring acquired all of the capital stock of Mecar for approximately $45,810 in cash, and separately Chemring acquired substantially all of the assets of Mecar USA for $13,750 in cash and the assumption by Chemring of certain specified liabilities of Mecar USA. A portion of the purchase price was paid through the repayment of certain intercompany indebtedness owed to the Company that would otherwise have been cancelled at closing. $15,000 of the proceeds from the sale was deposited into escrow to secure the Company's indemnification obligations under the Agreement. The $15,000 of cash plus earned interest income remains in escrow as of March 31, 2011. In conjunction with the Agreement, the Board of Directors of the Company unanimously approved the dissolution of the Company pursuant to a Plan of Complete Liquidation and Dissolution. The Company's stockholders approved the Plan of Dissolution on Sept. 30, 2010. In response to concerns of certain of the Company's stockholders, the Company has agreed to delay the filing of a certificate of dissolution with the Delaware Secretary of State so that the stockholders may continue to transfer the Company's common stock while the Company resolves the matters relating to the U.S. Department of Justice subpoena. The Company will delay the filing of a certificate of dissolution with the Delaware Secretary of State until the earlier of Aug. 31, 2011, or a resolution of all matters concerning the DOJ. On Sept. 2, 2010, the Company received a staff determination letter from NYSE Amex LLC. The Staff Determination stated that the Exchange determined that the Company no longer complies with the requirements for continued listing set forth in NYSE Amex LLC Company Guide Section 1003(c)(i) as a result of the sale of substantially all of the Company's assets. On Sept. 20, 2010, the Company announced that trading of shares of the Company's common stock had been transferred from the NYSE Amex to the OTCQBTM Marketplace effective Monday, Sept. 20, 2010. The Company's trading symbol is now ADGI. AMERICAN DENTAL: S&P Assigns 'B' Corporate Credit Rating -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Wakefield, Mass.-based American Dental Partners Inc. The rating outlook is stable. "We assigned our 'B' credit rating, the same as the corporate credit rating, to ADP's proposed $36 million first-lien revolving credit facility and $205 million first-lien term loan, and we assigned our '3' recovery rating to this debt, indicating our expectation for meaningful (50% to 70%) recovery of principal in the event of payment default," S&P said. "Our ratings on American Dental Partners Inc. assume the LBO transaction is completed as proposed; the ratings are based on our expectation that ADP's organic growth will be minimal, notwithstanding a gradually improving economy that bolsters medium-term prospects for the total U.S. dental services industry," said Standard & Poor's credit analyst Gail Hessol. "After making more than 100 acquisitions since ADP was founded in 1995, we believe management is now emphasizing growth through the opening of new dental care offices, although we expect the company will continue to be acquisitive. We expect ADP to generate discretionary cash flow in most years, as it did in each of the past six years, but we believe unanticipated operating problems, more aggressive expansion or other developments could require some additional borrowing." "ADP has a 'vulnerable' business risk profile, as defined in our criteria, notwithstanding its sizable network of 282 dental offices that offer general and specialty dental services. The company is narrowly focused in the extremely fragmented and highly competitive dental practice industry that has low barriers to entry. Treatment volume, especially for more discretionary services such as orthodontics, and patient financial capacity are vulnerable in economic downturns. The availability of financing for patients also influences demand. We believe the DPM industry could be adversely affected by potential changes in state or federal laws, regulations or accounting rules. We view ADP's business portfolio as highly concentrated as its two largest affiliated practices combined accounted for one-third of its revenue for the 9 months ended Sept. 30, 2011. There is also some geographic revenue concentration," S&P said. "The structure of ADP's DPM business model, in our view, creates the potential for costly and disruptive disputes between ADP and its affiliated dental practices and contributes to our 'vulnerable' business risk assessment. The company is currently engaged in litigation with three affiliated practices and significant litigation with a fourth was resolved in 2008. More than 90% of ADP's revenue is derived from service agreements with its affiliated practices, none of which are owned by ADP. Most of ADP's other revenue comes from a 94%-owned dental practice in Arizona," S&P said. AMERICAN EAGLE: Shut by Regulators; Capital Bank Assumes Deposits ----------------------------------------------------------------- American Eagle Savings Bank of Boothwyn, Pa., was closed on Friday, Jan. 20, 2012, by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Capital Bank, National Association, of Rockville, Md., to assume all of the deposits of American Eagle Savings Bank. The sole branch of American Eagle Savings Bank will reopen during its normal banking hours as a branch of Capital Bank, National Association. Depositors of American Eagle Savings Bank will automatically become depositors of Capital Bank, National Association. 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 American Eagle Savings Bank should continue to use their existing branch until they receive notice from Capital Bank, National Association, that it has completed systems changes to allow other Capital Bank, National Association, branches to process their accounts as well. As of Sept. 30, 2011, American Eagle Savings Bank had around $19.6 million in total assets and $17.7 million in total deposits. In addition to assuming all of the deposits of the failed bank, Capital Bank, National Association, agreed to purchase essentially all of the assets. Customers with questions about the transaction should call the FDIC toll-free at 1-800-355-0814. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/americaneagle.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $3.2 million. Compared to other alternatives, Capital Bank, National Association's acquisition was the least costly resolution for the FDIC's DIF. American Eagle Savings Bank is the third FDIC-insured institution to fail in the nation this year, and the first in Pennsylvania. The last FDIC-insured institution closed in the state was Public Savings Bank, Huntingdon Valley, on Aug. 18, 2011. AMERICAN MARINE: Self-Appointed Manager Objects to its Bankruptcy ----------------------------------------------------------------- Dow Jones' DBR Small Cap reports that the owner of Wortley American Marine Trust, a company that the owner says owns 20% of American Marine LLC's parent company, has filed a notice with the bankruptcy court saying that he will be asking the court to dismiss the American Marine bankruptcy because the court-appointed receiver doesn't have the authority to put the company in Chapter 11. About American Marine American Marine's primary business consists, inter alia, manufacturing, marketing, distributing, servicing and selling boats and related products in North Carolina. Brand names include Donzi, Fountain, Pro-Line and Baja. American Marine Holdings, LLC, along with affiliates, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Fla. Case No. 12-11354) on Jan. 18, 2012, after being sued for defaulting on its loans. Ronald Glass of GlassRatner Advisory & Capital Group, LLC, the receiver of American Marine, signed the bankruptcy petitions. FCC LLC d/b/a First Capital, which provided $51 million in loans prepetition, pushed for the appointment of a receiver after filing a complaint in state court. The receiver disclosed that the Debtor had no assets and had liabilities of $60,007,617 in the schedules attached to petition. The receiver said that debt to First Capital is $54 million. John E. Page, Esq., at Shraiberg, Ferrara, & Landau P.A., in Boca Raton, Florida, serves as counsel. GlassRatner Advisory & Capital Group Inc. serves as financial advisor. On Jan. 16, 2012, Joseph Wortley, a former owner and officer of American Marine, filed a Chapter 11 voluntary petition for Palmetto Park Financial, LLC (Case No. 12-11055-EPK). Mr. Glass contends that the voluntary petitions for Palmetto Park and related cases were null and void as Mr. Wortley no longer had the authority to file the cases. Mr. Glass is seeking the dismissal of the case. APPLETON PAPERS: James Tyrone Resigns as Senior Vice President -------------------------------------------------------------- James C. Tyrone, Senior Vice President of Appleton Papers Inc., has voluntarily resigned. Mr. Tyrone's resignation will be effective Jan. 30, 2012. About Appleton Papers Appleton Papers Inc. is a 100%-owned subsidiary of Paperweight Development Corp. Appleton Papers Inc. -- http://www.appletonideas.com/-- headquartered in Appleton, Wisconsin, produces carbonless, thermal, security and performance packaging products. Appleton has manufacturing operations in Wisconsin, Ohio, Pennsylvania, and Massachusetts, employs approximately 2,200 people and is 100% employee-owned. The Company's balance sheet at Oct. 2, 2011, showed $638.30 million in total assets, $764.66 million in total liabilities, $101.06 million in redeemable common stock, $139.94 million in accumulated deficit and a $87.47 million accumulated other comprehensive loss. * * * Appleton Papers carries a 'B' corporate credit rating from Standard & Poor's. BARBETTA LLC: Bankr. Administrator Has Objections to Plan --------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of North Carolina has continued until Jan. 25, 2012, at 11:30 a.m., the hearing to consider the confirmation of Barbetta, LLC's Plan of Reorganization. Marjorie K. Lynch, Bankruptcy Administrator, has asked the Court to direct the Debtor to modify the proposed Plan to address certain concerns and objections, and meet requirements of 11 U.S.C. Section 1129. According to the Bankruptcy Administrator, it objected to the confirmation of the Debtor's Plan because, among other things: -- the Debtor is delinquent in payment of Quarterly Fees and the filing of Monthly Reports; -- the Debtor is proposing to pay unsecured creditors in full over a five year period -- this does not satisfy the requirements of Section 1129(a)(7) which provides that if the Debtor were to be liquidated today it would result in full payment to the unsecured class; and -- the Debtor does not comply with the "absolute priority rule" as found in Section 1129(b)(2)(B) of the Bankruptcy Code. The Bankruptcy Administrator is represented by Brian C. Behr. The Chapter 11 plan The Plan, filed Oct. 18, 2011, contemplates a continuation of the Debtor's business. The Debtor intends to satisfy creditor claims from income earned through continued operations of leasing its real property. The Plan focuses on retaining the Debtor's properties that are financially feasible for the Debtor to maintain as rental properties and restructuring the obligations secured by such properties. General unsecured claims, estimated at $260,364, will be paid in full, in quarterly installments of $13,018.18 per quarter, over a period of 5 years. All payments will be distributed pro rata to allowed creditors within the Class. A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/barbettallc.dkt96.pdf About Barbetta, LLC Based in Selma, North Carolina, Barbetta, LLC, along with its owners, Charles E. Hester and Barbetta G. Hester, own a combined total of over 70 properties throughout the state of North Carolina. A significant majority of these properties are located in Johnston County, North Carolina; however, the Debtor, along with the Hesters, own property in 23 separate counties across the state of North Carolina. All of the income producing properties are rental properties leased for either commercial or residential use. The Debtor is the surviving entity after a merger with Hester 1996 Family Limited Partnership, South Pollock Street Development & Sign Co., LLC, Hester 5, LLC, and Hester 8, LLC. The Debtor filed for Chapter 11 bankruptcy (Bankr. E.D.N.C. Case No. 11-04370) on June 6, 2011. Judge J. Rich Leonard presides over the case. Trawick H. Stubbs, Jr. and Stubbs & Perdue, P.A., represents the Debtor in its restructuring efforts. The Debtor tapped Charles E. Hester, as member-manager of the Debtor, and the accounting firm of David J. Bradley, CPA, as accountants. In its schedules filed together with the petition, the Debtor disclosed $24,889,321 in total assets and $12,855,596 in total liabilities. The petition was signed by Charles E. Hester, member manager. Charles and Barbetta Hester also filed a separate Chapter 11 petition (Bankr. E.D.N.C. Case No. 11-04375) on June 6, 2011. BIG WHALE: Plan of Reorganization Declared Effective ---------------------------------------------------- The Big Whale, LLC, notified the U.S. Bankruptcy Court for the Eastern District of Wisconsin that the Effective Date of its Plan of Reorganization occurred on Nov. 17, 2011. The Court confirmed the Debtor's Plan on Oct. 24, 2011. As reported in the Troubled Company Reporter on Nov. 14, 2011, Judge James E. Shapiro confirmed the Debtor's reorganization plan, after the Debtor entered into stipulations with WaterStone Bank SSB and BMO Harris Bank N.A., to resolve their objections to the Plan. Under the modified plan, payments to creditors will be from the regular business income of the Reorganized Debtor. After the Confirmation Date, the Debtor will continue to hire Milwaukee Rents LLC to act as its property manager and Centro Construction & Development LLC to maintain its properties. A copy of the Modified Reorganization Plan is available for free at http://bankrupt.com/misc/BIGWHALE_plan.pdf About The Big Whale The Big Whale, LLC, owns 49 parcels of real property in Milwaukee County, Wisconsin. Those properties contain 138 rentable residential and commercial units. The Big Whale owns one industrial warehouse property, which is leased to various commercial/manufacturing tenants that operate their respective businesses in the building. The rental units are used to produce rental income from individual residential and commercial tenants. The Big Whale is managed by Steve Lindner and his sister, Debra Lindner. The Big Whale, LLC, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-23756) on March 21, 2011. In its schedules, the Debtor disclosed $12,278,647 in total assets and $13,613,203 in total liabilities as of the Petition Date. Jerome R. Kerkman, Esq., and Justin M. Mertz, Esq., at Kerkman & Dunn, in Milwaukee, Wisconsin, serves as the Debtor's bankruptcy counsel. B.R. SUMMERLIN: Plan of Reorganization Declared Effective --------------------------------------------------------- B.R. Summerlin Property, LLC, notifies the U.S. Bankruptcy Court for the District of Nevada that the Effective Date for its Second Amended Plan of Reorganization occurred on Nov. 8, 2011. The Court confirmed the Plan dated Sept. 19, 2011, on Oct. 24, 2011. A copy of the Plan is available for free at: http://bankrupt.com/misc/brsummerlin.2ndamendedplan.pdf About B.R. Summerlin Property Woodland Hills, California-based B.R. Summerlin Property, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11-10148) on Jan. 5, 2011. The Company disclosed $23,066,151 in assets and $15,414,103 in liabilities. Affiliates B.R. Brookfield Commons No. 1, LLC (Bankr. D. Nev. Case No. 10-38835) and B.R. Brookfield Commons No. 2, LLC (Bankr. D. Nev. Case No. 10-38838) filed separate Chapter 11 petitions on Nov. 29, 2010. The Debtor disclosed $23.07 million in assets, and $15.4 million in debts. B.R. Summerlin Property is represented by Gregory E. Garman, Esq., -- ggarman@gordonsilver --, Gabrielle A. Hamm, Esq., -- ghamm@gordonsilver.com --, at Gordon Silver, in Los Vegas, Nevada. CAMTECH PRECISION: Court Gives R&J Until Feb. 4 to File Plan ------------------------------------------------------------ Judge Paul G. Hyman has further extended R&J National Enterprises, Inc.'s exclusive right to file a plan through and including Feb. 4, 2012. R&J's exclusive right to solicit votes on that plan is also extended through April 16, 2012. R&J is an affiliated debtor of Camtech Precision Manufacturing, Inc. About Camtech Precision Avstar, founded in 2007, designs, manufactures and overhauls carburetors and fuel injection systems for aviation industry. Avstar is the holder of Federal Aviation Administration Parts Manufacturer Approvals for general aviation fuel systems. Avstar generates sales primarily from new product sales and overhauls of carburetors and servos for the general aviation industry. Jupiter, Florida-based Camtech Precision Manufacturing, Inc., Avstar Fuel Systems, Inc., and R & J National Enterprises, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case Nos. 10-22760, 10-22762 and 10-22762) on May 10, 2010. Bradley S. Shraiberg, Esq., who has an office in Boca Raton, Florida, serve as counsel to the Debtors. Carlos E. Sardi, Esq., and Glenn D. Moses, Esq., who have an office in Miami, Florida, represent the Official Committee of Unsecured Creditors. In its schedules, Camtech disclosed assets of $10,977,673 and debts of $14,625,066. CAMTECH PRECISION: Avstar Wants More Time to Solicit Plan Votes --------------------------------------------------------------- Avstar Fuel Systems, Inc., asks the U.S. Bankruptcy Court for the Southern District of Florida to extend its exclusive right to solicit votes on its proposed bankruptcy plan through and including March 5, 2012. Avstar is seeking an extension of its exclusive plan solicitation period to allow the claim of Marvel Schebler Aircraft Carburetors LLC to be estimated. MSA filed a motion to estimate claim for voting purposes in August 2011. According to Avstar's counsel, discovery between Avstar and MSA has been concluded and the parties will be contacting the Court's chambers to schedule an evidentiary hearing on the Claim Estimation, which is the last open issue before confirmation. Avstar, an affiliated debtor of Camtech Precision Manufacturing, Inc., filed its Plan and Disclosure Statement on July 5, 2011. It is currently in the process of preparing an amended disclosure statement. Avstar insists that its extension request is not a delay tactic, but rather is needed to resolve contingencies and negotiate with creditors. About Camtech Precision Avstar, founded in 2007, designs, manufactures and overhauls carburetors and fuel injection systems for aviation industry. Avstar is the holder of Federal Aviation Administration Parts Manufacturer Approvals for general aviation fuel systems. Avstar generates sales primarily from new product sales and overhauls of carburetors and servos for the general aviation industry. Jupiter, Florida-based Camtech Precision Manufacturing, Inc., Avstar Fuel Systems, Inc., and R & J National Enterprises, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case Nos. 10-22760, 10-22762 and 10-22762) on May 10, 2010. Bradley S. Shraiberg, Esq., who has an office in Boca Raton, Florida, serve as counsel to the Debtors. Carlos E. Sardi, Esq., and Glenn D. Moses, Esq., who have an office in Miami, Florida, represent the Official Committee of Unsecured Creditors. In its schedules, Camtech disclosed assets of $10,977,673 and debts of $14,625,066. CAPITOL BANCORP: Four Proposals Rejected at Annual Meeting ---------------------------------------------------------- Capitol Bancorp Limited announced the results of its reconvened annual meeting of shareholders held on Wednesday, Jan. 18, 2012. More than 70 percent of Capitol's outstanding shares voted on the shareholder proposals. As recommended by the board of directors, the majority of votes cast were against the proposals, with 64 percent voting against the proposal to amend Capitol's articles of incorporation to require majority voting for the election of directors, more than 78 percent voting against the proposal to redeem the preferred stock purchase rights under Capitol's tax benefits preservation plan, nearly 76 percent voting against the proposal to implement a policy requiring that the board of directors be comprised of a two-thirds majority of independent directors, and more than 74 percent voting against the declassification of the board of directors. About Capitol Bancorp Limited Capitol Bancorp Limited (NYSE: CBC) -- http://www.capitolbancorp.com/-- is a $5.1 billion national community banking company, with a network of bank operations in 16 states. Founded in 1988, Capitol Bancorp Limited has executive offices in Lansing, Michigan and Phoenix, Arizona. In September 2009, Capitol and its second-tier bank holding companies entered into a written agreement with the Federal Reserve Bank of Chicago under which Capitol has agreed, among other things, to submit to the Reserve Bank a written plan to maintain sufficient capital at Capitol on a consolidated basis and at Michigan Commerce Bank (as a separate legal entity on a stand- alone basis); and a written plan to enhance the consolidated organization's risk management practices, a strategic plan to improve the consolidated organization's operating results and overall condition and a cash flow projection. Certain of Capitol's bank subsidiaries have entered into formal agreements with their applicable regulatory agencies. Those agreements provide for certain restrictions and other guidelines and/or limitations to be followed by the banks. In 2009, Capitol commenced the deferral of interest payments on its various trust-preferred securities, as is permitted under the terms of the securities, to conserve cash and capital resources. The payment of interest may be deferred for periods up to five years. During such deferral periods, Capitol is prohibited from paying dividends on its common stock (subject to certain exceptions) and is further restricted by Capitol's written agreement with the Federal Reserve Bank of Chicago. Accrued interest payable on such securities approximated $18.1 million at June 30, 2010. The Company also reported a net loss of $45.04 million on $82.17 million of total interest income for the nine months ended Sept. 30, 2011, compared with a net loss of $163.10 million on $101.45 million of total interest income for the same period during the prior year. The Company's balance sheet at Sept. 30, 2011, showed $2.46 billion in total assets, $2.56 billion in total liabilities, and a $93.51 million in total deficit. As of Sept. 30, 2011, there are several significant adverse aspects of Capitol's consolidated financial position and results of operations which include, but are not limited to, the following: -- An equity deficit approximating $96 million; -- Regulatory capital classification on a consolidated basis as less than "adequately-capitalized" and related negative amounts and ratios; -- Numerous banking subsidiaries with regulatory capital classification as "undercapitalized" or 'significantly- undercapitalized"; -- Certain banking subsidiaries which are generally subject to formal regulatory agreements have received "prompt corrective action" notifications and directives from the FDIC, which require timely action by bank management and the respective boards of directors to resolve regulatory capital ratios which result in classification as less than "adequately-capitalized" or to submit an acceptable capital restoration plan to the FDIC, and it is likely additional PCANs or PCADs may be issued in the future or that the banking subsidiaries may be unable to satisfactorily resolve those notices or directives; -- In 2010 and 2011, Capitol sold several of its banking subsidiaries and has other divestiture transactions pending. The proceeds from those divestitures have been redeployed at certain remaining banking subsidiaries which have experienced a significant erosion of capital due to operating losses. While such proceeds have been a significant source of funds for redeployment, the Corporation will need to raise significant other sources of new capital in the future; -- The Corporation and substantially all of its banking subsidiaries are operating under various regulatory agreements which place a number of restrictions on them and impose other requirements limiting activities and requiring preservation of capital, improvement in regulatory capital measures, reduction of nonperforming assets and other matters for which the entities have not achieved full compliance; -- Elevated levels of nonperforming loans and other nonperforming assets as a percentage of consolidated loans and total assets, respectively; and -- Significant losses from continuing operations in 2011, 2010, 2009 and 2008, resulting primarily from provisions for loan losses, costs associated with foreclosed properties and other real estate owned and, in 2010, an impairment charge to operations for the write-off of previously-recorded goodwill ($64.5 million). The foregoing considerations raise some level of doubt as to the Corporation's ability to continue as a going concern. CARPENTER CONTRACTORS: Plan Outline Hearing Adjoined Until Feb. 13 ------------------------------------------------------------------ The Bankruptcy Court has continued until Feb. 13, 2012, at 1:30 p.m., the hearing to consider adequacy of the Disclosure Statement explaining Carpenter Contractors' Chapter 11 Plan. As reported in the Troubled Company Reporter on Sept. 23, 2011, the Plan of that contemplates the continuation of the Debtors' operations after plan confirmation plan. Donald L. Thiel will continue to sit as chairman and president of the post-confirmation management of Carpenter Contractors of America, Inc. Kenneth B. Thiel will retain his position as President of the post- confirmation management of CCA Midwest, Inc. The Plan of Reorganization and Disclosure Statement filed on Aug. 31, 2011, provide that payments and distributions under the Plan will be funded by the Debtors' current and ongoing business operations. In addition to the revenues generated by the business operations of the Debtors, Donald L. Thiel has agreed to the deferral of his unsecured claims which will result in additional cash availability. First American has agreed to provide the Debtors with a one year $5,120,000 exit financing line of credit renewable annually for 3 years, and a $2,500,000 term note, repayable in 36 monthly installments. Donald and Judith Thiel have also agreed to provide the Debtors with exit financing in the form of a $1,000,000 revolving line of credit, repayable when the Debtors have available cash flow. A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/carpentercontractors.DS.pdf About Carpenter Contractors Pompano Beach, Florida-based Carpenter Contractors of America, Inc., dba R&D Thiel, provides carpentry services to builders of new homes primarily in Illinois and Florida. It also manufactures building components and distributes construction materials in Illinois, Florida, and North Carolina. CCA Midwest Inc. provides carpentry services to builders of new homes in Illinois. It is a wholly-owned subsidiary of Carpenter Contractors. Carpenter Contractors and CCA Midwest filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Lead Case No. 10-42604) on Oct. 25, 2010. Chad P. Pugatch, Esq., and Christian Savio, Esq., at Rice Pugatch Robinson & Schiller, P.A., in Ft. Lauderdale, Fl., serve as the Debtors' bankruptcy counsel. Attorneys at Shaw Gussis Fishman Glantz Wolfson & Towbin LLC, serve as special counsel. GlassRatner Advisory & Capital Group, LLC, led by Thomas Santoro, is the Debtors' financial advisor, and Scott L. Spencer, CPA and Crowe Horwath, LLP. is the Debtors' accountant for audit work. Carpenter Contractors disclosed $42,900,573 in assets and $25,861,652 in liabilities as of the Chapter 11 filing. The U.S. Trustee for Region 21 notified the Court that until further notice, he will not appoint a committee of creditors. CATALYST PAPER: Hearing on Recapitalization Set on Feb. 3 --------------------------------------------------------- Catalyst Paper Corporation, in accordance with an interim order from the British Columbia Superior Court dated Jan. 17, 2012, that a hearing is scheduled to be held on Feb. 3, 2012 with respect to its previously announced recapitalization transaction. Full details of the recapitalization agreement and the transaction will be provided in a management information circular expected to be distributed to shareholders, holders of its 11% senior secured notes due 2016 (the Senior Secured Notes) and holders of its 7 3/8% senior notes due 2014 (Senior Notes and together with the Senior Secured Notes, the Noteholders) in February 2012. At the Hearing, Catalyst Paper will apply for the following orders and declarations: -- an order that the Circular of Catalyst Paper be deemed to represent sufficient and adequate disclosure, including for the purpose of section 192 of the Canada Business Corporations Act (CBCA), and Catalyst Paper shall not be required to send to Noteholders any other or additional statement pursuant to section 192 of the CBCA; -- an order approving a form of proxy that Catalyst Paper is authorized to use in connection with the Noteholders' meetings; -- an order approving Jan. 27, 2012, or such other date as disclosed by Catalyst Paper in a press release, as the early consent date for the purposes of the proposed arrangement and consideration allocated thereunder; -- a declaration that a vote of the holders of common shares in the capital of Catalyst Paper is not required for court approval of the proposed arrangement pursuant to section 192(4)(e) of the CBCA; -- an order that the votes cast in favour of the arrangement at the Meetingshall, in the event of a subsequent Companies' Creditors Arrangement Act (CCAA) proceeding being commenced as a result of the petitioners not obtaining the requisite votes at the Meeting or obtaining the final order, in all respects be counted as votes in favour of the recapitalization transaction in such CCAA proceedings; and -- such further and other relief as counsel for any petitioners may advise and the Court may deem just. Implementation of the plan of arrangement under the CBCA is subject to approval by not less than 66?% of the votes cast by holders of each of the Senior Secured Notes and the Senior Notes at meetings to be held to consider the arrangement, the approval of the Supreme Court of British Columbia and receipt of all necessary regulatory and stock exchange approvals. In addition, the Agreement is subject to termination if a new labor agreement with all union locals at the company's Canadian mills has not been ratified by Jan. 31, 2012. Catalyst Paper manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With four mills, located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 1.9 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. About Catalyst Paper Catalyst Paper Corp. -- http://www.catalystpaper.com/-- manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With four mills, located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 1.9 million tons. The Company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst Paper in January 2012 applied for and received an initial court order under the Canada Business Corporations Act (CBCA) to commence a consensual restructuring process with its noteholders. Affiliate Catalyst Paper Holdings Inc., sought creditor protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 12-10219) on Jan. 17, 2012. The company is seeking recognition of these proceedings with the Delaware Court in order for the Canadian order under the CBCA to be recognized in the United States. The company will continue to operate and satisfy its obligations to trade creditors, customers, employees and retirees in the ordinary course of business during this restructuring process. Catalyst on Dec. 15, 2011, deferred a US$21 million interest payment on its outstanding 11.00% Senior Secured Notes due 2016 and Class B 11.00% Senior Secured Notes due 2016 due on Dec. 15, 2011. Catalyst said it was reviewing alternatives to address its capital structures and it is currently in discussions with noteholders. Perella Weinberg Partners served as the financial advisor. In early January 2012, Catalyst said it had entered into a restructuring agreement, which will see its bondholders taking control of the company and includes an exchange of debt for equity. The agreement said it would slash the company's debt by C$315.4 million ($311 million) and reduce its cash interest expenses. Catalyst also said it will continue to "operate and satisfy" its obligations to customers, trade creditors, employees and retirees in the ordinary course of business during the restructuring process. Catalyst Paper joins a line of paper producers that have succumbed to higher costs, increased competition from Asia and Europe, and falling demand as more advertisers and readers move online. Last year, Cerberus Capital-backed NewPage Corp. filed for bankruptcy protection, followed by SP Newsprint Co., owned by newsprint magnate and fine art collector Peter Brant. In December, Wausau Paper said it will close its Brokaw mill in Wisconsin, cut 450 jobs and exit its print and color business. CATALYST PAPER: Third Avenue Discloses 28.3% Equity Stake --------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Third Avenue Management LLC disclosed that, as of Jan. 17, 2012, it beneficially owns 107,901,621 shares of common stock of Catalyst Paper Corporation representing 28.3% of the shares outstanding. This calculation is based on 381,900,450 common shares of the Company outstanding as of Nov. 14, 2011, as reported in the Company's third quarter report filed on Nov. 16, 2011. A full-text copy of the amended filing is available for free at http://is.gd/m937x5 About Catalyst Paper Catalyst Paper Corp. -- http://www.catalystpaper.com/-- manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With four mills, located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 1.9 million tons. The Company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst Paper in January 2012 applied for and received an initial court order under the Canada Business Corporations Act (CBCA) to commence a consensual restructuring process with its noteholders. Affiliate Catalyst Paper Holdings Inc., sought creditor protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 12-10219) on Jan. 17, 2012. The company is seeking recognition of these proceedings with the Delaware Court in order for the Canadian order under the CBCA to be recognized in the United States. The company will continue to operate and satisfy its obligations to trade creditors, customers, employees and retirees in the ordinary course of business during this restructuring process. Catalyst on Dec. 15, 2011, deferred a US$21 million interest payment on its outstanding 11.00% Senior Secured Notes due 2016 and Class B 11.00% Senior Secured Notes due 2016 due on Dec. 15, 2011. Catalyst said it was reviewing alternatives to address its capital structures and it is currently in discussions with noteholders. Perella Weinberg Partners served as the financial advisor. In early January 2012, Catalyst said it had entered into a restructuring agreement, which will see its bondholders taking control of the company and includes an exchange of debt for equity. The agreement said it would slash the company's debt by C$315.4 million ($311 million) and reduce its cash interest expenses. Catalyst also said it will continue to "operate and satisfy" its obligations to customers, trade creditors, employees and retirees in the ordinary course of business during the restructuring process. Catalyst Paper joins a line of paper producers that have succumbed to higher costs, increased competition from Asia and Europe, and falling demand as more advertisers and readers move online. Last year, Cerberus Capital-backed NewPage Corp. filed for bankruptcy protection, followed by SP Newsprint Co., owned by newsprint magnate and fine art collector Peter Brant. In December, Wausau Paper said it will close its Brokaw mill in Wisconsin, cut 450 jobs and exit its print and color business. CENTRAL FEDERAL: Annual Stockholders Meeting Set for May 17 ----------------------------------------------------------- Central Federal Corporation's annual meeting of stockholders will be held on May 17, 2012, at the Fairlawn Country Club, 200 North Wheaton Road, Fairlawn, Ohio at 10:00 AM. The record date for stockholders eligible to vote at the meeting is April 6, 2012. About Central Federal Fairlawn, Ohio-based Central Federal Corporation (Nasdaq: CFBK) is the holding company for CFBank, a federally chartered savings association formed in Ohio in 1892. CFBank has four full-service banking offices in Fairlawn, Calcutta, Wellsville and Worthington, Ohio. The Company's balance sheet at Sept. 30, 2011, showed $265.4 million in total assets, $254.0 million in total liabilities, and stockholders' equity of $11.4 million. Regulatory Matters On May 25, 2011, Central Federal Corporation and CFBank each consented to the issuance of an Order to Cease and Desist (the Holding Company Order and the CFBank Order, respectively, and collectively, the Orders) by the Office of Thrift Supervision (OTS), the primary regulator of the Holding Company and CFBank at the time the Orders were issued. The Holding Company Order requires it, among other things, to: (i) submit by June 30, 2011, a capital plan to regulators that establishes a minimum tangible capital ratio commensurate with the Holding Company's consolidated risk profile, reduces the risk from current debt levels and addresses the Holding Company's cash flow needs; (ii) not pay cash dividends, redeem stock or make any other capital distributions without prior regulatory approval; (iii) not pay interest or principal on any debt or increase any Holding Company debt or guarantee the debt of any entity without prior regulatory approval; (iv) obtain prior regulatory approval for changes in directors and senior executive officers; and (v) not enter into any new contractual arrangement related to compensation or benefits with any director or senior executive officer without prior notification to regulators. The CFBank Order required CFBank to have by Sept. 30, 2011, and maintain thereafter, 8% Tier 1 (Core) Capital to adjusted total assets and 12% Total Capital to risk weighted assets. CFBank will not be considered well-capitalized as long as it is subject to individual minimum capital requirements. CFBank did not comply with the higher capital ratio requirements by the Sept. 30, 2011 required date. CDC CORP: Court OKs Kobre & Kim to Handle Evolution Matters ----------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia authorized CDC Corporation to employ Kobre & Kim LLP as its special litigation counsel in connection with: -- pending cases involving Evolution CDC SPV Ltd., Evolution Master Fund Ltd., SPC, Segregated Portfolio, and E1 Fund Ltd.; and -- potential litigation issues that might arise in connection with transactions contemplated pursuant to the Debtor's engagement letter with Moelis & Company LLC, the Debtor's financial advisor and investment banker. The firm's attorneys charge US$400 to US$825 per hour, with the exception of one of its partners who are English Queen's Counsel whose rates are GBP750 per hour, which amount will be converted to US dollars upon invoicing at the then current exchange rate. Non- lawyer paraprofessionals charge a blended rate of US$250 per hour. About CDC Corp 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. CDC Corporation, doing business as Chinadotcom, filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 11-79079) on Oct. 4, 2011. James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout, PA, in Atlanta, Georgia, serves as counsel. Moelis & Company LLC serves as its financial advisor and investment banker. Marcus A. Watson at Finley Colmer and Company serves as chief restructuring officer. The Debtor estimated assets and debts at $100 million to $500 million as of the Chapter 11 filing. CDC CORP: Equity Committee Taps Morgan Joseph as Fin'l Advisor -------------------------------------------------------------- The Official Committee of Equity Security Holders of CDC Corporation seeks permission from the U.S. Bankruptcy Court for the Northern District of Georgia to retain Morgan Joseph TriArtisan LLC as its financial advisor. Subject to the Court's approval, Morgan Joseph will receive a monthly fee of $100,000. Morgan Joseph will also receive a completion fee of $750,000, provided, however, that if the transaction is not (a) a sale of all or a majority of the equity securities of the Company's subsidiary CDC Software Corporation, (b) the merger or combination of the Business with that of an acquirer or other third party or (c) an acquirer's acquisition of all or a portion of the assets, properties of business operations of the Business, whether pursuant to an 11 U.S.C. Section 363 sale, plan of reorganization, sale of CDC Corporation or otherwise, then the completion fee will be $2,000,000. The firm will also seek reimbursement for reasonable out-of-pocket expenses it incurred in connection with the engagement. To the best of the Equity Committee's knowledge, Morgan Joseph is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About CDC Corp 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. CDC Corporation, doing business as Chinadotcom, filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 11-79079) on Oct. 4, 2011. James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout, PA, in Atlanta, Georgia, serves as counsel. Moelis & Company LLC serves as its financial advisor and investment banker. Marcus A. Watson at Finley Colmer and Company serves as chief restructuring officer. The Debtor estimated assets and debts at $100 million to $500 million as of the Chapter 11 filing. CENTURY PLAZA: Has Interim Access to Cash Collateral Until Feb. 29 ------------------------------------------------------------------ The Hon. J. Phillip Klingeberger of the U.S. Bankruptcy Court for the Northern District of Indiana authorized, on an interim order, Century Plaza LLC, to use The PrivateBank and Trust Company's cash collateral until Feb. 29, 2012. The Debtor is authorized to make expenditures not exceeding 10% of the total proposed expenses, unless otherwise agreed by the lender. The Court also ordered that the Debtor will: -- maintain and pay premiums for insurance to cover all of its assets from fire, theft and water damage; -- maintain a depository account, separate from any other account into which the Debtor will deposit any and all tenant real estate tax escrow payments collected after the filing of the Debtor's case; -- make available to the lender evidence of that which constitutes its collateral or proceeds; and -- maintain the property in good repair and manage the property. The Debtor set a Feb. 28, 2012, hearing at 1:30 p.m., on its request to further access the cash collateral. About Century Plaza Based in Merrillville, Indiana, Century Plaza LLC owns and operates a commercial shopping center known as "Century Plaza". Century Plaza filed for Chapter 11 bankruptcy (Bankr. N.D. Ind. Case No. 11-24075) on Oct. 18, 2011. The Debtor estimated assets and debts of $10 million to $50 million. The petition was signed by Richard Dube, president of Tri-Land Properties, Inc., manager. Judge J. Philip Klingeberger presides over the case. The Debtor's counsel are Crane, Heyman, Simon, Welch & Clar; and Anderson & Anderson P.C. CITIZENS CORP: Files Plan to Pay Tennessee Commerce in Full ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Citizens Corp. filed a reorganization plan offering to pay all creditors in full over time, including Tennessee Commerce Bank and other secured lenders owed $17.3 million. The plan proposes paying the lenders in full with 2% interest. The new loan would amortize principal on a 30-year schedule. The remaining principal would mature in five years. Unsecured creditors, owed a combined $81,000, would be paid off in equal installments over five years. The lenders' $463,000 unsecured claim likewise would be fully paid over five years. According to the report, the principal asset is ownership of non- bankrupt Financial Data Technology Corp., a provider of information technology services for Tennessee banks. Exercising a pledge of the stock of FiData, the lenders took over control of the subsidiary prior to the Chapter 11 case. The Chapter 11 plan is designed for the holding company to regain control of the subsidiary. Mr. Rochelle notes that at one time, Citizens was attempting to have the lenders held in contempt for refusal to turn over control of the subsidiary. Now, Citizens is only asking the bankruptcy judge to return control of the subsidiary at a Jan. 30 hearing. At the same hearing, the lenders will seek appointment of a trustee. The lenders previously said they were owed $19.2 million, which is more than the value of the FiData stock, according to the banks. About Citizens Corp. Franklin, Tennessee-based Citizens Corp. operates a mortgage brokerage business. Citizens Corp. filed for Chapter 11 bankruptcy (Bankr. M.D. Tenn. Case No. 11-11792) on Nov. 28, 2011. Judge George C. Paine, II presides over the case. Robert J. Mendes, Esq., at MGLAW, PLLC, serves as the Debtor's counsel. Marion Ed Lowery, a former owner of Peoples State Bank of Commerce of Nolensville and various other entities, serves as chairman of the company. He signed the Chapter 11 petition. Lenders Tennessee Commerce Bank is represented by David W. Houston, IV, Esq., at Burr & Forman LLP. Citizens filed lists of assets and liabilities showing property worth $40.1 million and debt of $17.8 million. CLAIRE'S STORES: Bank Debt Trades at 11% Off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which Claire's Stores, Inc., is a borrower traded in the secondary market at 88.97 cents- on-the-dollar during the week ended Friday, Jan. 20, 2012, an increase of 1.00 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 275 basis points above LIBOR to borrow under the facility. The bank loan matures on May 29, 2014, and carries Moody's B3 rating and Standard & Poor's B rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. The Company's balance sheet at Oct. 29, 2011, showed $2.81 billion in total assets, $2.86 billion in total liabilities, and a $44.61 million stockholders' deficit. As reported by the Troubled Company Reporter on March 15, 2011, Moody's upgraded Claire's Stores' senior secured bank credit facilities to B3 from Caa1 and its Speculative Grade Liquidity Rating to SGL-2 from SGL-3. All other ratings were affirmed including Claire's Caa2 Corporate Family Rating. The rating outlook is positive. CLARE OAKS: Opposes Appointment of Patient Care Ombudsman --------------------------------------------------------- Clare Oaks asks the U.S. Bankruptcy Court for the Northern District of Illinois to enter an order finding the appointment of a patient care ombudsman unnecessary. The Bankruptcy Code provides that, "[i]f the debtor in a case under chapter ... 11 is a health care business, the court shall order, not later than 30 days after the commencement of the case, the appointment of an ombudsman to monitor the quality of patient care and to represent the interests of the patients of the health care business unless the court finds that the appointment of such ombudsman is not necessary for the protection of patients under the specific facts of the case." The Patient Care Ombudsman will, among other things, monitor the quality of patient care provided to patients by the Debtor. According to the Debtor, the totality of circumstances in its bankruptcy case demonstrates that the appointment of a Patient Care Ombudsman is not necessary to protect residents of the Clare oaks Campus. The Debtor maintains that the patients' rights at Clare Oaks are adequately protected through existing internal and external safeguards, and it is able to maintain and provide adequate services and care for its residents without the appointment of a patient care ombudsman. About Clare Oaks Clare Oaks, an Illinois not-for-profit corporation organized under section 501(c)(3) of the Internal Revenue Code, operates a namesake continuing care retirement community in Bartlett, Illinois. Its members are the Sisters of St. Joseph of the Third Order of St. Francis, a Roman Catholic religious institute, who are elected and serving as the members of the Central Board of the Congregation. Clare Oaks is managed by CRSA/LCS Management LLC, an affiliate of Life Care Services LLC. Clare Oaks filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 11-48903) on Dec. 5, 2011. Judge Pamela S. Hollis presides over the case. David R. Doyle, Esq., George R. Mesires, Esq., and Patrick F. Ross, Esq., at Ungaretti & Harris LLP, serve as the Debtor's counsel. North Shores Consulting serves as the Debtor's operations consultant. Continuum Development Services and Alvarez & Marsal Healthcare Industry Group LLC serve as advisors. Alvarez & Marsal's Paul Rundell serves as the Chief Restructuring Officer. Sheila King Marketing + Public Relations serves as communications advisors. In its petition, Clare Oaks estimated $100 million to $500 million in assets and debts. The petition was signed by Michael D. Hovde, Jr., president. Wells Fargo, as master trustee and bond trustee, is represented by Daniel S. Bleck, Esq., and Charles W. Azano, Esq., at Mintz Levin Cohen Ferris Glovsky and Popeo PC; and Robert M. Fishman, Esq., and Allen J. Guon, Esq., at Shaw Gussis Fishman Glantz Wolfson & Towbin LLC. Sovereign Bank, the letters of credit issuer, is represented by John R. Weiss, Esq., at Duane Morris LLP. Senior Care Development LLC, the DIP Lender, is represented by William S. Fish, Jr., Esq., and Sarah M. Lombard, Esq., at Hinckley Allen & Snyder LLP. CLARE OAKS: Wants to Hire George Mesires as Bankruptcy Counsel -------------------------------------------------------------- Clare Oaks seeks permission from the U.S. Bankruptcy Court for the Northern District of Illinois to employ George R. Mesires and Ungaretti & Harris LLP as its bankruptcy counsel. Prior to the Petition Date, Ungaretti & Harris represented the Debtor in connection with various matters, including its attempts to restructure out-of-court and, subsequently, in preparing the filing of the Chapter 11 case. Current billing rates for the Ungaretti & Harris attorneys with primary responsibility for these matters are: Donald L. Schwartz ($760/hour); George R. Mesires ($475/hour); Patrick F. Ross ($265/hour); David R. Doyle ($245/hour). Current billing rates for other Ungaretti & Harris attorneys who may provide legal services in this case are: (a) Partners ? $315 to $760/hour (b) Associates ? $195 to $315/hour (c) Paralegals ? $175 to $205/hour Pursuant to an engagement letter dated Nov. 1 2011, as amended, the Debtor has agreed to compensate Ungaretti & Harris on a basis that reflects a discount of approximately 10% from Ungaretti & Harris' standard restructuring rates. On Nov. 1, 2011, the Debtor transferred $750,000 to Ungaretti & Harris, which was initially to be held in trust and thereafter applied to various professionals as retainers, as contemplated by the terms of the Engagement Letter. Ungaretti & Harris will also request reimbursement for expenses incurred in connection with its representation of the Debtor. To the best of the Debtor's knowledge, Ungaretti & Harris is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Clare Oaks Clare Oaks, an Illinois not-for-profit corporation organized under section 501(c)(3) of the Internal Revenue Code, operates a namesake continuing care retirement community in Bartlett, Illinois. Its members are the Sisters of St. Joseph of the Third Order of St. Francis, a Roman Catholic religious institute, who are elected and serving as the members of the Central Board of the Congregation. Clare Oaks is managed by CRSA/LCS Management LLC, an affiliate of Life Care Services LLC. Clare Oaks filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 11-48903) on Dec. 5, 2011. Judge Pamela S. Hollis presides over the case. David R. Doyle, Esq., George R. Mesires, Esq., and Patrick F. Ross, Esq., at Ungaretti & Harris LLP, serve as the Debtor's counsel. North Shores Consulting serves as the Debtor's operations consultant. Continuum Development Services and Alvarez & Marsal Healthcare Industry Group LLC serve as advisors. Alvarez & Marsal's Paul Rundell serves as the Chief Restructuring Officer. Sheila King Marketing + Public Relations serves as communications advisors. In its petition, Clare Oaks estimated $100 million to $500 million in assets and debts. The petition was signed by Michael D. Hovde, Jr., president. Wells Fargo, as master trustee and bond trustee, is represented by Daniel S. Bleck, Esq., and Charles W. Azano, Esq., at Mintz Levin Cohen Ferris Glovsky and Popeo PC; and Robert M. Fishman, Esq., and Allen J. Guon, Esq., at Shaw Gussis Fishman Glantz Wolfson & Towbin LLC. Sovereign Bank, the letters of credit issuer, is represented by John R. Weiss, Esq., at Duane Morris LLP. Senior Care Development LLC, the DIP Lender, is represented by William S. Fish, Jr., Esq., and Sarah M. Lombard, Esq., at Hinckley Allen & Snyder LLP. CLEAN BURN: Bankruptcy Administrator Pushes Ch. 7 Liquidation ------------------------------------------------------------- Michael D. West, Esq., the U.S. Bankruptcy Administrator for the Middle District North Carolina asks the U.S. Bankruptcy Court to convert the Chapter 11 case of Clean Burn Fuels, LLC to one under Chapter 7 of the Bankruptcy Code. The U.S. Bankruptcy Administrator tells the Court: -- The stay has been lifted as to all of the Debtor's tangible assets or the assets have been sold; -- The Debtor is not conducting any ongoing business, and has no business left to reorganize or liquidate; -- The Debtor failed to file its Plan and Disclosure Statement by the Aug. 1, 2011 deadline; -- The monthly reports filed by the Debtor show continuing losses; and -- Perdue BioEnergy LLC, major creditor and litigant, has filed a motion to convert the case, although the litigation position of Perdue must be considered in the analysis, the issue it raises as to management of the Debtor is serious. As reported in the Troubled Company Reporter on Dec. 29, 2011, Perdue is a defendant in an adversary proceeding in which the Debtor sought, among other things, to avoid Perdue's claimed ownership of corn feedstock that was to be used in the operation of the Debtor's ethanol facility. Perdue said the conversion of the Debtor's case to Chapter 7 and the appointment of a Chapter 7 trustee will insure that an independent fiduciary will be present to make the decisions for the estate in regard to the adversary proceeding. Perdue related that on the Petition Date, Debtor had no corporate officers willing to undertake and manage the responsibilities of pursuing a Chapter 11 reorganization. The U.S. Bankruptcy Administrator asserts that the conversion of the case is in the best interests of creditors and the estate. The U.S. Bankruptcy Administrator is represented by Robert E. Price, Jr. 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., in Chapel Hill, N.C., represents the Debtor. Neal, Bradsher & Taylor, P.A., serves as its accountants. Charles M. Ivey, Esq., at Ivey McClellan Gatton, in Greensboro, N.C., represents the Creditors' Committee as counsel. Since the petition date, the Debtor has not operated its ethanol plant. CLEAR CHANNEL: Bank Debt Trades at 22% Off in Secondary Market -------------------------------------------------------------- Participations in a syndicated loan under which Clear Channel Communications, Inc., is a borrower traded in the secondary market at 77.58 cents-on-the-dollar during the week ended Friday, Jan. 20, 2012, a drop of 0.35 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 365 basis points above LIBOR to borrow under the facility. The bank loan matures on Jan. 30, 2016, and carries Moody's Caa1 rating and Standard & Poor's CCC rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About CC Media and Clear Channel San Antonio, Texas-based CC Media Holdings, Inc. (OTC BB: CCMO) -- http://www.ccmediaholdings.com/-- is the parent company of Clear Channel Communications, Inc. CC Media Holdings is a global media and entertainment company specializing in mobile and on-demand entertainment and information services for local communities and premier opportunities for advertisers. The Company's businesses include radio and outdoor displays. CC Media has three reportable business segments: Radio Broadcasting; Americas Outdoor Advertising; and International Outdoor Advertising. Approximately half of CC Media's revenue is generated from its Radio Broadcasting segment. The Company's balance sheet at Sept. 30, 2011, showed $16.51 billion in total assets, $23.96 billion in total liabilities and a $7.45 billion total member's deficit. As reported by the Troubled Company Reporter on Dec. 16, 2011, Standard & Poor's revised its rating outlook on CC Media Holdings Inc., and Clear Channel, which S&P views on consolidated basis, to negative from positive. "We affirmed our ratings on the company, including the corporate credit rating of 'CCC+'," S&P said. "The outlook revision reflects our view that softening ad demand and global economic uncertainty could slow the pace of revenue growth at CC Media over the intermediate term, heightening refinancing risk around its 2014 and 2016 debt maturities," explained Standard & Poor's credit analyst Michael Altberg. "The 'CCC+' corporate credit rating reflects the risks surrounding the longer-term viability of the company's capital structure in particular, refinancing risk relating to sizable secured and unsecured debt maturities in 2014 ($2.9 billion) and 2016 ($12.3 billion). We view CC Media's financial risk profile as 'highly leveraged' (based on our criteria), given the company's significant refinancing risk, very slim EBITDA coverage of interest expense, and minimal discretionary cash flow compared to its debt burden. In our view, the company has a 'fair' business risk profile, because of its position as the largest U.S. radio and global outdoor advertising operator," S&P said. CYBEX INTERNATIONAL: Receives Add'l Nasdaq Non-Compliance Notice ---------------------------------------------------------------- Cybex International, Inc., on Jan. 17, 2012, received a determination letter from The Nasdaq Stock Market indicating that the Company's common stock was subject to delisting from Nasdaq because it failed to maintain a minimum market value of publicly held shares of $5,000,000 for thirty consecutive business days as required by Nasdaq Listing Rule 5450(b)(1)(c). The Company has a compliance period of 180 calendar days, or until July 16, 2012, in which to regain compliance. The Company can regain compliance if at any time during this 180-day period the market value of publicly held shares closes at $5,000,000 or more for a minimum of ten consecutive business days. The Company intends to monitor the market value of its publicly held shares and will consider available options to resolve this deficiency and regain compliance with the Nasdaq Listing Rules. As previously reported, the Company previously received determination letters from Nasdaq indicating that the Company's common stock was subject to delisting from Nasdaq due to failure to comply with the minimum stockholders' equity requirement of $10 million and the minimum bid price requirement of $1 per share. Subsequently, a Nasdaq Hearings Panel granted the Company's request for continued listing on Nasdaq, subject to specified conditions. These conditions are: -- Stockholders' Equity Requirement. On or before April 2, 2012, the Company must publicly announce on a Form 8-K its stockholders' equity, which shall be $10 million or greater. -- Minimum Bid Price Requirement. On or before March 12, 2012, the Company will have evidenced a closing bid price above $1.00 for a minimum of 10 consecutive trading days. In order to fully comply with the terms of this exception, the Company must be able to demonstrate compliance with all requirements for continued listing on Nasdaq. In the event the Company is unable to do so, its securities may be delisted from Nasdaq. About Cybex International Medway, Mass.-based Cybex International, Inc. (NASDAQ: CYBI) -- http://www.cybexintl.com/--is a manufacturer of exercise equipment and develops, manufactures and markets strength and cardiovascular fitness equipment products for the commercial and, to a lesser extent, consumer markets. The net loss was $454,000 on $97.1 million of net sales for the nine months ended Sept. 24, 2011, compared with a net loss of $1.1 million on $83.0 million of net sales for the nine months ended Sept. 25, 2010. The Company's balance sheet at Sept. 24, 2011, showed $87.8 million in total assets, $103.0 million in total liabilities, and a stockholders' deficit of $15.2 million. As reported in the TCR on April 8, 2011, KPMG LLP, in Pittsburgh, Pa., expressed substantial doubt about Cybex International's ability to continue as a going concern, following the Company's results for the fiscal year ended Dec. 31, 2010. The independent auditors noted that a December 2010 jury verdict in a product liability suit apportions a significant amount of liability to the Company. "The Company does not have the resources to satisfy a judgment in this matter that has not been substantially reduced from the jury verdict, which raises substantial doubt about the Company's ability to continue as a going concern." DALLAS ROADSTER: Gets Final Court OK on $400,000 Bankruptcy Loan ---------------------------------------------------------------- Dallas Roadster Limited and IEDA Enterprise, Inc. won final court approval to obtain from Texas Capital Bank, N.A., up to $400,000 in financing, to be used in accordance with a prepared budget, a copy of which is available for free at: http://bankrupt.com/misc/DALLASROADSTER_DIPLoanBudgettruJan31.pdf In a Jan. 12, 2012 order, Judge Brenda Rhoades ruled that the Debtors' authority to draw funds under the DIP Loan will terminate on the earlier of January 31, 2012, or upon the occurrence of a violation by the Debtors of the terms of the DIP Loan Agreement. All advances under the DIP Loan are secured by a lien in all of the Debtors' assets, which lien will have the highest administrative priority under Sec. 364(c)(1) of the Bankruptcy Code. The DIP Loan Liens are subject to the carve-out for unpaid fees under 28 U.S.C. Sec. 1930, unpaid fees incurred by bankruptcy professional of the Debtors and any statutory creditors committee, and unpaid compensation of the Receiver under Sec. 543, in a total amount not to exceed $250,000. About Dallas Roadster and IEDA Enterprises Dallas Roadster Ltd. owns and operates an auto dealership with locations in both Richardson and Plano, Texas. IEDA Enterprises, Inc., is the general partner of Roadster. Dallas Roadster and IEDA Enterprises filed for Chapter 11 bankruptcy (Bankr. E.D. Tex. Case Nos. 11-43725 and 11-43726) on Dec. 12, 2011. Chief Judge Brenda T. Rhoades oversees both cases. Michael S. Mitchell, Esq., and Robert T. DeMarco, Esq. -- mike@demarcomitchell.com and robert@demarcomitchell.com -- at DeMarco-Mitchell, PLLC, serve as the Debtors' bankruptcy counsel. Dallas Roadster estimated $10 million to $50 million in assets. The Debtors' assets were placed under the care of a receiver on Nov. 16, 2011, pursuant to a state court action by Texas Capital Bank, National Association. TCB may be reached at: Texas Capital Bank, National Association c/o Jennifer Owen HIGIER ALLEN & LAUTIN, P.C. 5057 Keller Springs Road, Suite 600 Addison, TX 75001-6608 E-mail: jowen@higierallen.com The receiver for the Debtors' assets may be reached at: Patrick Michaels P.E. MICHAELS CONSULTING 1403 Marlboro Lane Richardson, TX 75082 E-mail: pat@pemichaels.com D.C. DEVELOPMENT: Court OKs Cole Schotz as Committee's Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Maryland authorized the Official Committee of Unsecured Creditors of D.C. Development, LLC, to retain Cole, Schotz, Meisel, Forman & Leonard, P.A., as its counsel. The firm's hourly rates are: Personnel Rates --------- ----- Partners and Special Counsel $335 to $775 Associates $210 to $385 Paralegals $160 to $240 About D.C. Development D.C. Development, LLC, is the owner of the Wisp Resort, a sky resort in the mountains of Garrett County, Maryland. The ski and golf resort is situated on 2,200 acres with two golf courses, 32 ski trails, and 12 ski lifts. The hotel has 102 suites and 67 guest rooms. Financial problems were caused by a guarantee given to Branch Banking & Trust Co. to secure a $29.6 million judgment the bank obtained on a real estate development within the property. D.C. Development, LLC, along with affiliates, filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 11-30548) on Oct. 15, 2011. The Debtor disclosed $91,155,814 in assets and $46,141,245 in liabilities as of the Chapter 111 filing. D.C. Development has engaged Logan, Yumkas, Vidmar & Sweeney, LLC, as counsel and tapped Invotex Group as financial restructuring consultant. The Official Committee of Unsecured Creditors has tapped Cole, Schotz, Meisel, Forman & Leonard, P.A. as counsel. D.C. DEVELOPMENT: Taps Maloney and Associates as Accountants ------------------------------------------------------------ D.C. Development, LLC, Recreational Industries, Inc., Wisp Resort Development, Inc., and The Clubs at Wisp, LLC, seek permission from the U.S. Bankruptcy Court for the District of Maryland to employ Maloney and Associates, PLLC, as their accountants. Maloney and Associates will assist in the preparation of the federal and state corporate income tax returns for the fiscal year ended Oct. 31, 2011, the annual review of financial statements required by the ongoing business operations, the 2011 audit of the 401(k) plan for required by ERISA and Department of Labor guidelines, the preparation of the federal and state partnership income returns for 2011, the preparation of the federal and state corporate income tax returns for 2011, and the preparation of annual financial statements required by ongoing business operations. The customary hourly rates of Maloney are: Partners/Principals $120 to $150 Seniors $80 to $90 Staff/Paraprofessionals $45 to $65 Administrative $40 The firm will seek reimbursement for its expenses and will include charges for typing, copying, travel, telephones, computer rental, etc. To the best of the Debtors' knowledge, Maloney and its individual accountants do not have any connections with the Debtors, other creditors or any other party-in-interest, their respective attorneys and accountants, the United States Trustee, or any person employed in the Office of the United States Trustee and is a "disinterested person" as that term is defined under Section 101(14) of the Bankruptcy Code. About Wisp Resort Recreational Industries Inc., D.C. Development LLC, Wisp Resort Development Inc., and The Clubs at Wisp LLC own and operate the Wisp Resort, a sky resort in the mountains of Garrett County, Maryland. The ski and golf resort is situated on 2,200 acres with two golf courses, 32 ski trails, and 12 ski lifts. The hotel has 102 suites and 67 guest rooms. Financial problems were caused by a guarantee given to Branch Banking & Trust Co. to secure a $29.6 million judgment the bank obtained on a real estate development within the property. Recreational Industries, D.C. Development, Wisp Resort Development and The Clubs at Wisp filed for Chapter 11 bankruptcy (Bankr. D. Md. Lead Case No. 11-30548) on Oct. 15, 2011. D.C. Development disclosed $91,155,814 in assets and $46,141,245 in liabilities as of the Chapter 111 filing. The Debtors engaged Logan, Yumkas, Vidmar & Sweeney LLC as counsel and tapped Invotex Group as financial restructuring consultant. The Official Committee of Unsecured Creditors has tapped Cole, Schotz, Meisel, Forman & Leonard, P.A. as counsel. D.C. DEVELOPMENT: Proposes Non-Debtor Affiliate as Broker --------------------------------------------------------- D.C. Development seeks permission from the U.S. Bankruptcy Court for the District of Maryland to employ Wisp Resort Development, Inc., the Company's affiliate, as broker to sell 120 Lodestone Way Property. Wisp Resort developed the lot and borrowed funds from Branch Banking and Trust Company to do so. SWR, LLC, borrowed funds from Clear Mountain Bank to construct a single-family home on the lot. The lot and home constitute the "Property". The Debtor has determined that it is in the best interests of its estate to sell the Property and the Court has authorized such sale in the amount of $430,000. However, the Court ordered that the seven percent sales commission be held in escrow pending application to and further order of the Court. Wisp Resort, along with its real estate agents and real estate broker, is the entity responsible for the listing, marketing and sale of the Property. The Debtor intends to disburse to Wisp Resort the commission equal to seven percent of the purchase price of the Property, in the amount of $30,100. According to the Debtor, the seven percent sales commission is customary rate in the Deep Creek Lake and Wisp Resort real estate market. The Debtor asserts that preventing it from disbursing these commissions will have a chilling effect on itself to sell property in the future and will thwart its ability to reorganize. Th Debtor attests that WRD and its professionals do not have connections with other creditors or any other party-in-interest and the Debtor attests that WRD is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Wisp Resort Recreational Industries Inc., D.C. Development LLC, Wisp Resort Development Inc., and The Clubs at Wisp LLC own and operate the Wisp Resort, a sky resort in the mountains of Garrett County, Maryland. The ski and golf resort is situated on 2,200 acres with two golf courses, 32 ski trails, and 12 ski lifts. The hotel has 102 suites and 67 guest rooms. Financial problems were caused by a guarantee given to Branch Banking & Trust Co. to secure a $29.6 million judgment the bank obtained on a real estate development within the property. Recreational Industries, D.C. Development, Wisp Resort Development and The Clubs at Wisp filed for Chapter 11 bankruptcy (Bankr. D. Md. Lead Case No. 11-30548) on Oct. 15, 2011. D.C. Development disclosed $91,155,814 in assets and $46,141,245 in liabilities as of the Chapter 111 filing. The Debtors engaged Logan, Yumkas, Vidmar & Sweeney LLC as counsel and tapped Invotex Group as financial restructuring consultant. The Official Committee of Unsecured Creditors has tapped Cole, Schotz, Meisel, Forman & Leonard, P.A. as counsel. DELTA PETROLEUM: Court Approves Hughes Hubbard as Counsel --------------------------------------------------------- Delta Petroleum Corporation, et al., sought and obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ Hughes Hubbard & Reed LLP as their counsel. Beginning in October 2011, Hughes Hubbard began working with the Debtors, their lenders and other debtholders toward resolving the Debtors' financial issues. Since that time, Hughes Hubbard has been closely involved in every detail of the Debtors' restructuring. Hughes Hubbard's current hourly rates are: Partners $700 - $975 Counsel $640 - $925 Associates $350 - $695 Legal Assistants $240 Consistent with Hughes Hubbard's policy with respect to its other clients, Hughes Hubbard will continue to charge the Debtors for all other services provided and for other charges and disbursements incurred in the rendition of services. Prior to the Petition Date, Hughes Hubbard received a retainer from the Debtors in the amount of $500,000, which it continues to hold. To the best of the Debtors' knowledge, the members, counsel and associates of Hughes Hubbard do not have any connection with the Debtors, their creditors, or any other party-in-interest, or their respective attorneys and accountants. The Debtors attest that Hughes Hubbard is a "disinterested person" within the meaning of Sections 101(14) of the Bankruptcy Code. The firm can be contacted at: W. Peter Beardsley, Esq. Christopher Gartman, Esq. Kathryn A. Coleman, Esq. Ashley J. Laurie, Esq. HUGHES HUBBARD & REED LLP One Battery Park Plaza New York, NY 10004-1482 Tel: (212) 837-6000 Fax: (212) 422-4726 About Delta Petroleum Delta Petroleum Corporation (NASDAQ: DPTR) is an independent oil and gas company engaged primarily in the exploration for, and the acquisition, development, production, and sale of, natural gas and crude oil. Natural gas comprises over 90% of Delta's production services. The core area of its operations is the Rocky Mountain Region of the United States, where the majority of the proved reserves, production and long-term growth prospects are located. Delta and seven of its subsidiaries sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 11-14006 to 11-14013, inclusive) on Dec. 16, 2011, roughly six weeks before the Jan. 31, 2012 scheduled maturity of its $38.5 million secured credit facility with Macquarie Bank Limited and after several months of unsuccessful attempts to sell the business. Delta disclosed $375,498,248 in assets and $310,679,157 in liabilities, which also include $152,187,500 in outstanding obligations on account of the 7% senior unsecured notes issued in March 2005 with US Bank National Association indenture trustee; and $115,527,083 in outstanding obligations on account of 3-3/4% Senior Convertible Notes due 2037 issued in April 2007. W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A. Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard & Reed LLP, in New York, N.Y., represent the Debtors as counsel. Derek C. Abbott, Esq., Ann C. Cordo, Esq., and Chad A. Fights, Esq., at Morris, Nichols, Arsht & Tunnel LLP, in Wilmington, Del., represent the Debtors as co-counsel. Conway Mackenzie is the Debtors's restructuring advisor. The Debtors selected Epiq Bankruptcy Solutions, LLC as claims and noticing agent. The petition was signed by Carl E. Lakey, chief executive officer and president. DELTA PETROLEUM: Court OKs Morris Nichols as Local Counsel ---------------------------------------------------------- Delta Petroleum Corporation, et al., sought and obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ Morris, Nichols, Arsht and Tunnell LLP as their Delaware co-counsel. The attorneys and paralegals principally responsible for the representation of the Debtors and their current hourly rates are: (a) Derek C. Abbott (partner) $600 (b) Ann C. Cordo (associate) $455 (c) Chad A. Fights (associate) $405 (d) Renae M. Fusco (paralegal) $230 The Debtors will reimburse Morris Nichols for necessary expenses incurred, which will include travel, photocopying, delivery service, postage, vendor charges and other out-of-pocket expenses incurred in providing professional services. To the best of the Debtors' knowledge, information and belief, none of Morris Nichols' partners, counsel or associates hold or represent any interest adverse to the Debtors' estates or their creditors, and Morris Nichols is a "disinterested person," as defined in Section 101(14) of the Bankruptcy Code. About Delta Petroleum Delta Petroleum Corporation (NASDAQ: DPTR) is an independent oil and gas company engaged primarily in the exploration for, and the acquisition, development, production, and sale of, natural gas and crude oil. Natural gas comprises over 90% of Delta's production services. The core area of its operations is the Rocky Mountain Region of the United States, where the majority of the proved reserves, production and long-term growth prospects are located. Delta and seven of its subsidiaries sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 11-14006 to 11-14013, inclusive) on Dec. 16, 2011, roughly six weeks before the Jan. 31, 2012 scheduled maturity of its $38.5 million secured credit facility with Macquarie Bank Limited and after several months of unsuccessful attempts to sell the business. Delta disclosed $375,498,248 in assets and $310,679,157 in liabilities, which also include $152,187,500 in outstanding obligations on account of the 7% senior unsecured notes issued in March 2005 with US Bank National Association indenture trustee; and $115,527,083 in outstanding obligations on account of 3-3/4% Senior Convertible Notes due 2037 issued in April 2007. W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A. Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard & Reed LLP, in New York, N.Y., represent the Debtors as counsel. Derek C. Abbott, Esq., Ann C. Cordo, Esq., and Chad A. Fights, Esq., at Morris, Nichols, Arsht & Tunnel LLP, in Wilmington, Del., represent the Debtors as co-counsel. Conway Mackenzie is the Debtors's restructuring advisor. The Debtors selected Epiq Bankruptcy Solutions, LLC as claims and noticing agent. The petition was signed by Carl E. Lakey, chief executive officer and president. DEX MEDIA WEST: Bank Debt Trades at 44% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which Dex Media West LLC is a borrower traded in the secondary market at 55.50 cents-on- the-dollar during the week ended Friday, Jan. 20, 2012, a drop of 0.33 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 450 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 24, 2014, and carries Standard & Poor's CCC rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Dex Media West Dex Media West LLC is a subsidiary of Dex Media West, Inc., and an indirect wholly owned subsidiary of Dex Media, Inc. Dex Media is a direct wholly owned subsidiary of R.H. Donnelley Corporation. Dex Media West is the exclusive publisher of the official yellow pages and white pages directories for Qwest Corporation, the local exchange carrier of Qwest Communications International, Inc., in Arizona, Idaho, Montana, Oregon, Utah, Washington, and Wyoming. R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media East LLC, Dex Media West LLC and Dex Media, Inc., filed for Chapter 11 protection (Bank. D. Del. Case No. 09-11833 through 09- 11852) on May 28, 2009, after missing a $55 million interest payment on its senior unsecured notes due April 15, 2009. James F. Conlan, Esq., Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq., Jeffrey E. Bjork, Esq., and Peter K. Booth, Esq., at Sidley Austin LLP, in Chicago, Illinois, served as lead bankruptcy counsel to the Debtors. Attorneys at Young, Conaway, Stargatt & Taylor LLP, in Wilmington, Delaware, served as local counsel. Deloitte Financial Advisory Services LLP was the financial advisor and Lazard Freres & Co. LLC was the investment banker. The Garden City Group, Inc., was claims and noticing agent. The Official Committee of Unsecured Creditors tapped Ropes & Gray LLP as its counsel, Cozen O'Connor as Delaware bankruptcy co-counsel, J.H. Cohn LLP as its financial advisor and forensic accountant, and The Blackstone Group, LP, as its financial and restructuring advisor. The Debtors emerged from Chapter 11 bankruptcy proceedings at the end of January 2010. DS WATERS: Moody's Assigns 'B1' Rating to Proposed Term Loans ------------------------------------------------------------- Moody's Investors Service has assigned a B1 rating to the proposed $465 million first lien secured term loan facilities due 2017, which will be used to partially fund the recapitalization of DS Waters of America, Inc.'s (New) (DSWA) balance sheet. Further, a B1 corporate family rating has been assigned to the post- recapitalization DSWA entity. The rating outlook is stable. These ratings are predicated on the completion of the recapitalization and subject to Moody's review of final documentation. The recapitalization plan would use proceeds from a proposed $390 million first lien term loan due 2017 and roughly $100 million of cash to repay DSWA's existing $180 million term loan B due October 2012 (Ba3) and $300 million Holdco term loan due April 2012 (not rated). The plan would also include the exchange of roughly $421 million Group PIK Notes due March 2012 (not rated) into $421 million Participating Perpetual Preferred Equity and result in preferred equity holders obtaining a 55% common equity interest. In addition, the recapitalization would include a proposed $75 million first lien delayed draw term loan due 2017, the proceeds of which are expected to be used to finance the potential acquisition of a provider of brewed beverages and related products to offices, restaurants and foodservice organizations ("CoffeeCo"). These ratings have been assigned to DS Waters of America (NEW): Corporate Family Rating at B1; Probability of Default Rating at B1; B1 (LGD4, 55%) to the $390 million first lien secured term loan due 2017; and B1 (LGD4, 55%) to the $75 million first lien delayed draw term loan due 2017. Moody's will treat the exchange of the Group PIK Notes for preferred and common equity as a distressed exchange in accordance with Moody's Definition of Default. It is Moody's view that the exchange constitutes default avoidance given the imminent maturity of the existing Group PIK Notes in March 2012. Accordingly, Moody's has lowered the existing PDR to Ca from B3 to reflect the heightened probability of default. All other ratings at the existing DS Waters of America, Inc. entity have been affirmed. At close, Moody's will assign an "/LD" modifier to the existing PDR to designate the limited default and will withdraw all ratings on the existing DS Waters of America, Inc. entity shortly thereafter. RATINGS RATIONALE "The proposed recapitalization is expected to substantially improve DSWA's capital structure which is supportive of the B1 CFR, both by lowering its leverage and by extending its maturity profile," stated Moody's Analyst Brian Grieser. With a more flexible capital structure in place, Moody's anticipates that DSWA will accelerate its acquisition strategy beginning with its plans to acquire CoffeeCo, which would be the largest acquisition in DSWA's history. The pending acquisition is expected to create one of the larger players in the niche US office coffee service market and enable DSWA to expand its filtration business. Moody's expects that DSWA's free cash flow will support the company's acquisition strategy while maintaining balance sheet leverage below 4.0x, before inclusion of Moody's adjustment for preferred stock. Although Moody's expects modest earnings growth in 2012, driven by improving customer and order trends as well as profits from acquired businesses, the ratings are constrained by the risk that a weak economy will continue to pressure pricing and margins. Moody's also expects DSWA's exposure to diesel fuel and resin costs to remain a pressure on margins given the company's limited ability to pass through commodity price increases. The company has reported minimal sales growth and declining EBITDA over the last few years. Further, ongoing restructuring and integration costs along with high capital investment requirements will limit cash flow expansion over the near term. The ratings are also constrained by DSWA's growth strategy being tied to acquisitions and further penetration into markets where it has not historically held a market dominant position, such as retail, coffee and filtration. The B1 corporate family rating reflects DSWA's improved leverage following the restructuring, consistent free cash generation, leading market position in the fragmented US home and office delivery (HOD) market, high barriers to new competition, its portfolio of regional brands and a good liquidity profile. DSWA's market position continues to improve given its ability to consolidate local players and increase its route density which is critical in an industry with limited pricing power. Despite rising commodity costs weighing on earnings, DSWA has held EBITDA margins above 16% and continues to generate free cash flow. The B1 rating on the proposed $465 million first lien secured credit facility reflects its first priority lien on all property and assets (excluding current assets and certain real estate) and a second priority lien on all current assets and certain real estate. Further, the proposed term loan facility will account for the majority of the prospective capital structure. DSWA's unrated $70 million asset-based credit facility due 2017 will have a first lien priority interest on the accounts receivable, inventory and selected real estate and second lien on all other assets. Ratings pressure could arise if the company executes any large acquisitions prior to the integration of the CoffeeCo acquisition. Further, if revenues decline or margins continue to erode such that leverage exceeds 4.5x (before inclusion of Moody's adjustment for preferred stock), the ratings could be downgraded. The ratings also incorporate Moody's expectation that the term loan facility will meaningfully restrict dividends from DSWA to its parent entities. Therefore, any dividends prior to a material improvement in the company's financial performance will negatively impact the ratings. Following completion of the recapitalization, Moody's does not anticipate near term improvement in the ratings. Over the medium term, the ratings could be upgraded if the company records steady revenue and organic EBITDA growth over a period of 1 to 2 years and Moody's comes to expect that the company's financial policies will be consistent with debt-to-EBITDA being maintained below 3.0 (before inclusion of Moody's adjustment for preferred stock). The principal methodology used in rating DSWA was the Global Soft Beverage 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. DSWA, headquartered in Atlanta, Georgia, is a provider of bottled water and related services delivered directly to residential and commercial customers in the U.S. (operates in 43 states). Its core business is the bottling and direct delivery of drinking water in 3 and 5 gallon bottles to homes and offices and the rental of water dispensers. The company also sells water in smaller bottles, cups, coffee, flavored beverages and powdered sticks, and sells water filtration devices. Proforma for the restructuring, DSWA will be owned by Kelso and Co (33%), preferred equity holders (55%), consisting primarily of Glenview Capital Management, GoldenTree Asset Management and Solar Capital, and management (12%). Revenues for 2011 were roughly $765 million. EASTMAN KODAK: Proposes $950-Mil. of DIP Financing -------------------------------------------------- Eastman Kodak Company and its debtor affiliates seek authority from Judge Allan L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York to obtain postpetition financing facilities totaling $950 million on a senior secured, priming, superpriority basis. The DIP Facility is composed of: -- up to $700 million senior secured non-amortizing term loan facility, with $450 million available at the Effective Date and an additional $250 million that will be available upon entry of the Final DIP Order; -- up to $250 million senior secured non-amortized asset-based revolving credit facility, which provides that $25 million will be available to fund only non-debtor affiliate Kodak Canada. The Revolving Credit Facility will include a subfacility for letters of credit in the aggregate amount of $200 million. On the interim, the Debtors seek authority to borrow not more than $450 million under the U.S. Term Facility and $225 million under the U.S. Revolving Credit Facility, with an additional $25 million under the Canadian Revolving Facility. Borrowers under the DIP Facility are Eastman Kodak Company and Kodak Canada, Inc., only with respect to the Canadian Revolving Facility. Each of the Debtors is a guarantor. Citicorp North America, Inc., is administrative agent, collateral agent, and syndication agent. The sole lead arranger and bookrunner is Citigroup Global Markets Inc. The Lenders are an affiliate of the Arranger and other financial institutions. Proceeds of the DIP Facility will be used to refinance the Debtors' Prepetition First Lien Debt; pay vendors and suppliers while minimizing disruption to day-to-day operations; fund restructuring costs and necessary capital expenditures; and satisfy working capital requirements. Counsel for the Debtors, Andrew G. Dietderich, Esq., at Sullivan & Cromwell LLP, in New York, says in court papers that it is essential that the Debtors obtain immediate access to the DIP Facility pointing out several key drivers for the Debtors' near- term liquidity issues, including substantially higher than normal commodity prices and revenue declines; poor investment performance and declining interest rates; delay in cash flow from the licensing and sale of intellectual property; and negative publicity and other external issues. The DIP Facility contemplates the payment of fees and reimbursement of expenses to professionals of the Agent, the Issuing Bank, and in certain circumstances, any Lender. The DIP Facility also includes various commitment fees and letter of credit fees. The DIP Facility includes priming liens granted pursuant to Section 364(d)(1) of the Bankruptcy Code that prime the Existing Second Lien Debt. The Debtors will also provide adequate protection to the Prepetition First Lien Secured Lenders by deeming certain prepetition letters of credit to be issued pursuant to, and secured under, the DIP Agreement, or backstopping those letters of credit by depositing cash collateral or issuing new letters of credit issued under the DIP Agreement. The Prepetition Second Lien Noteholders will receive adequate protection in the form of administrative claims and adequate protection liens. A Carve-Out will apply to U.S. Trustee fees and applicable interest, professional fees of the Debtors and the official committee of unsecured creditors incurred prior to the occurrence of an Event of Default; and professional fees of the Debtors and the official committee of unsecured creditors incurred after an Event of Default of up to $10 million. Cash or other amounts on deposit in the Letter of Credit Cash Deposit Account will not be subject to the Carve-Out. The DIP Facility imposes certain limitations on asset dispositions and investments made by the Company in its Subsidiaries that are not Loan Parties under the DIP Facility, with the exception of Kodak Canada, to which the limitations do not apply, in amounts exceeding $100 million at any time outstanding. The aggregate amount of the investments made during any fiscal quarter cannot exceed $25 million and no investment is permitted to be made if at the time of their making any default under the DIP Facility exists or would result therefrom. The DIP Facility enumerates a number of Events of Default, including, but not limited to (a) failure to pay principal, interest or any other amount when due under the DIP Facility, (b) postpetition judgments, subject to certain provisos, in excess of $25 million, (c) certain changes to the ownership or control of the Company, (d) the entry of an order appointing a Chapter 7 or Chapter 11 trustee, (e) reversing, amending, supplementing, staying for a period of five days or more, vacating or otherwise amending the Interim Order or the Final Order in a fashion not satisfactory to the Agent, and (f) the occurrence of certain actions or events in respect of pension-related proceedings in the United Kingdom that would reasonably be expected to have a Material Adverse Effect. The Debtors may prepay in full or in part, without premium or penalty the Loans; provided that each partial prepayment will be in an aggregate amount of $10 million, or $5 million in the case of the Canadian Revolving Credit Facility, or multiples of $1 million in excess thereof. Milestones/Deadlines The DIP Agreement provides for these milestones or deadlines: June 30, 2012 -- Filing of a bidding procedures motion under Section 363 of the Bankruptcy Code relating to the sale of the Digital Imaging Patent Portfolio Jan. 15, 2013 -- Delivery to the Administrative Agent drafts of (i) a plan of reorganization in that provides for the termination of the unused commitments and the payment in full in cash of the Loan Parties' obligations under the DIP Facility, and (ii) a disclosure statement with respect to the plan Feb. 15, 2013 -- Filing with the Bankruptcy Court an Acceptable Reorganization Plan and a disclosure statement A draft pro forma 13-week cash flow projections for the Debtors is available for free at: http://bankrupt.com/misc/EastmanKodak13WkBudget.pdf CNAI, as DIP Agent, is represented by: Marshall S. Huebner, Esq. Brian S. Resnick, Esq. DAVIS POLK & WARDWELL LLP 450 Lexington Avenue New York, NY 10017 Tel: (212) 450-4000 Fax: (212) 701-5800 E-mail: marshall.huebner@davispolk.com brian.resnick@davispolk.com Apple Objects Apple Inc. told Judge Gropper that it does not oppose Kodak's acquisition of postpetition financing as a general matter, but opposes Kodak's request to grant security interests in and liens on patents that Kodak does not own. Apple pointed out that Kodak's assets that will secure its financing will include certain patents that are subject to ongoing patent ownership and patent infringement disputes between Kodak and Apple. Central to these disputes is Apple's belief that it is the rightful owner of the U.S. Patent No. 6,292,218 and potentially other patents in Kodak's digital imaging portfolio. The disputes are the subject of ongoing actions pending in the U.S. International Trade Commission and the United States District Court for the Western District of New York. Apple asks that any order approving the proposed financing contain clarifying language that no security interests or liens will attach to patents to which Apple is the owner and has claimed ownership unless and until there is a judicial determination resolving the ownership dispute between Apple and Kodak. Apple is represented by: James H.M. Sprayregen, P.C., Esq. Paul M. Basta, Esq. Brian S. Lennon, Esq. KIRKLAND & ELLIS LLP 601 Lexington Avenue New York, NY 10022 Tel: (212) 446-4800 Fax: (212) 446-4900 E-mail: james.sprayregen@kirkland.com paul.basta@kirkland.com brian.lennon@kirkland.com -- and -- David R. Seligman P.C., Esq. KIRKLAND & ELLIS LLP 300 North LaSalle Chicago, IL 60654 Tel: (312) 862-2000 Fax: (312) 862-2200 E-mail: david.seligman@kirkland.com About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EASTMAN KODAK: Proposes to Continue Using Cash Collateral --------------------------------------------------------- On the Petition Date, Eastman Kodak's outstanding secured funded debt was $946 million. This consists of (a) approximately $100 million of loans outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit, and (b) $750 million in principal amount of second lien secured notes. The Debtors seek authority from Judge Allan Gropper to use the funds on deposit with any Prepetition Secured Creditor as of the Petition Date, any proceeds of prepetition collateral and any other cash collateral of the Prepetition Secured Creditors within the meaning of section 363(a) of the Bankruptcy Code. As of the Petition Date, the Debtors' Cash Collateral totaled approximately $56.7 million. The Prepetition Secured Creditors will be granted adequate protection. The Existing Second Lien Debt holders whose liens will be primed and whose cash collateral will be authorized for use by the Loan Parties, will be entitled to receive as adequate protection (i) liens on the Collateral that are junior to the liens securing the DIP Facility, the adequate protection liens, and other liens of the Prepetition First Lien Secured Lien Lenders; and (ii) administrative claims as provided for in Section 507(b) of the Bankruptcy Code, junior to the DIP Superpriority Claims. A draft pro forma 13-week cash flow projections for the Debtors is available for free at: http://bankrupt.com/misc/EastmanKodak13WkBudget.pdf Bank of America, N.A., as prepetition first lien agent, is represented by: Fredric Sosnick, Esq. Susan A. Fennessey, Esq. SHEARMAN & STERLING LLP 599 Lexington Avenue New York, NY 10022 Tel: (212) 848-4000 Fax: (212) 848-7179 E-mail: fsosnick@shearman.com sfennessey@shearman.com Certain holders of the (i) 9.75% Senior Secured Notes due March 1, 2018, issued pursuant to that certain Indenture dated March 5, 2010, as amended, supplemented or otherwise modified from time to time, by and among Eastman Kodak Company, as issuer, the guarantors, and Bank of New York Mellon, as indenture trustee and (ii) 10.625% Secured Notes due March 15, 2019, issued pursuant to that certain Indenture dated March 15, 2011, as amended, supplemented or otherwise modified from time to time, by and among EK, as issuer, the guarantors, and Bank of New York Mellon, as indenture trustee, are represented by: Michael S. Stamer, Esq. David H. Botter, Esq. Abid Qureshi, Esq. Alexis Freeman, Esq. Rachel Ehrlich Albanese, Esq. AKIN GUMP STRAUSS HAUER & FELD LLP One Bryant Park New York, NY 10036 Tel: (212) 872-1000 Fax: (212) 872-1002 E-mail: mstamer@akingump.com dbotter@akingump.com aqureshi@akingump.com afreeman@akingump.com About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EASTMAN KODAK: Schedules Deadline Extended to March 19 ------------------------------------------------------ At the behest of Eastman Kodak Company and its debtor affiliates, Judge Allan L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York extended the time for the Debtors to file their schedules of assets and liabilities, statements of financial affairs, schedules of executory contracts and unexpired leases to March 19, 2012. Andrew G. Dietderich, Esq. at Sullivan & Cromwell LLP, in New York, told the Court that the Debtors require extra time to prepare and file their Schedules and Statements given the scope and complexity of their businesses, coupled with the limited time and resources available to them to compile the required information. Mr. Dietderich added that focusing the attention of the Debtors' key accounting and legal personnel on critical operational and Chapter 11 compliance issues during the early days of their Chapter 11 cases will help the Debtors make a smoother transition into Chapter 11 and, therefore, ultimately will maximize the value of their estates for the benefit of creditors and all parties-in- interest. Rule 2015.3 Reports The Debtors also sought and obtained a Court ruling extending the time for them to file reports of financial information with respect to entities in which their estates hold a controlling or substantial interest pursuant to Rule 2015.3 of the Federal Rules of Bankruptcy Procedure until 45 days after the meeting of creditors pursuant to Section 341 of the Bankruptcy Code will be held. The extended filing deadline will enable the Debtors to work with their financial advisors and the U.S. Trustee to determine the appropriate nature and scope of the 2015.3 Reports and any proposed modifications to the reporting requirements established by Rule 2015, Mr. Dietderich said. Moreover, the Debtors sought and obtained Court authority to waive the requirements (i) under Rule 1007(a)(3) of the Federal Rules of Bankruptcy Procedure to file the Equity Holders List, and (ii) under Rule 2002(d) to give the Notice of Commencement to all of the Debtors' equity security holders. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EASTMAN KODAK: Trustee for UK-Kodak Pension Expected to File Claim ------------------------------------------------------------------ Eastman Kodak Co. and its affiliates said in court papers accompanying their Chapter 11 filing that they expect KPP Trustees Limited, the trustee for the Kodak pension plan in the United Kingdom, to have a significant general unsecured claim against Eastman Kodak Company by virtue of a Guaranty Agreement, effective October 9, 2007, among EKC, the Trustee and EKC's U.K. subsidiary, Kodak Limited. The Guarantee is governed by English law and on its face, among other things, and subject to certain terms and conditions, guarantees the ability of Kodak Limited to contribute to the Plan (i) the minimum amount of assets necessary so that the Plan will have sufficient assets to make member benefit payments as they are immediately due and payable if the Plan would not otherwise have sufficient assets needed to make such benefit payments; and (ii) that the Plan will achieve a "Full Funding status" by December 31, 2022. The Debtors said they have not determined a valuation of the Trustee's potential claim in connection with the Guarantee. As part of the preparation for the Chapter 11 proceedings, representatives of the Debtors traveled to London to meet with the Board of Directors of the Trustee and the Pension Regulator of the United Kingdom. The meetings occurred on January 11 and 12, 2012. At these meetings, representatives of the Debtors discussed confidentially the prospect of these proceedings and their intent that only the U.S. entities of the Kodak group file for Chapter 11, and that non-U.S. companies continue to conduct operations in the ordinary course of business. The Debtors' representatives discussed their plans to ensure for adequate funding for European operations during these proceedings. The representatives also informed the Trustee and the Pension Regulator of the Debtors' view that ordinary course operations around the world, and the absence of non-U.S. insolvency proceedings, are in the best interest of the Trustee and critical to maximizing value for all stakeholders of the Debtors, including the Trustee. The Debtors said they intend to work collaboratively with the Trustee and have invited them to take an active role in the Chapter 11 proceedings. KPP Trustees Limited is represented by: Christopher R. Donoho III, Esq. HOGAN LOVELLS US LLP 875 Third Avenue New York, NY 10022 Tel: (212) 918-3000 Fax: (212) 918-3100 E-mail: chris.donoho@hoganlovells.com About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EASTMAN KODAK: Meeting to Form Creditors' Panel on Jan. 25 ---------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on Jan. 12, 2012, at 9:30 a.m. in the bankruptcy case of Eastman Kodak Company, et al. The meeting will be held at: Andaz Wall Street Hotel 75 Wall Street New York, NY 10005 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. EASTMAN KODAK: Moody's Cuts Probability of Default Rating to 'D' ---------------------------------------------------------------- Moody's Investors Service lowered Eastman Kodak's Probability of Default Rating to D from Caa3. The downgrade was prompted by the company's January 19, 2012 announcement that it voluntarily filed for relief under Chapter 11 of the United States Bankruptcy Code. This rating was downgraded and will be withdrawn: Probability of Default Rating downgraded to D from Caa3 The following ratings have been affirmed and will be withdrawn: Corporate Family Rating at Caa3 $500 million Senior Secured Notes due 2018, at Caa1; LGD2, 12%; $250 million Senior Secured Notes due 2019, at Caa1; LGD2, 12%; $3 million Senior Unsecured Notes due 2018, at Ca; LGD4, 54%; $10 million Senior Unsecured Notes due 2021, at Ca; LGD4, 54%; $250 million Senior Unsecured Global Notes due 2013, at Ca; LGD4, 54%; Speculative Grade Liquidity rating at SGL - 4 The LGD rates on both secured and unsecured instruments have been revised to reflect Moody's expectations of a higher than average expected firm wide recovery rate. RATINGS RATIONALE The downgrade follows the announcement that Eastman Kodak and its U.S. subsidiaries commenced voluntary cases under Chapter 11 of the United States Bankruptcy Code. Subsequent to the actions, Moody's will withdraw the ratings because Eastman Kodak has entered bankruptcy. The principal methodology used in rating Eastman Kodak was the Global Technology Hardware Industry Methodology published in September 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Eastman Kodak Company, headquartered in Rochester, N.Y., provides imaging technology products and services to the photographic, graphic arts commercial printing, consumer digital, and entertainment imaging market. Kodak reported $6.2 billion in revenue for the twelve months ended September 2011. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EASTMAN KODAK: Court OKs $650-Mil. of Loans on Interim ------------------------------------------------------ Eastman Kodak Company disclosed that Judge Allan L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York has approved initial availability of $650 million in interim Debtor- in-Possession (DIP) financing by Citigroup. Kodak will use these funds, among other things, to pay vendors and other suppliers for all post-petition goods and services, and to operate its day-to- day business activities. The Judge set Feb. 15, 2012 as the date of a hearing to issue the final order regarding first day motions. As announced earlier, Eastman Kodak Company and its U.S. subsidiaries filed to reorganize its U.S. business under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York. Non-U.S. subsidiaries were not part of the filing. The interim DIP approved as part of the first day motions represents the first portion of the fully-committed, $950 million debtor-in- possession credit facility that it obtained from Citigroup to enhance liquidity and working capital. Kodak also reported that the Court has approved additional "First Day Motions" which assures that ongoing business will not be disrupted. In this regard, Kodak received authorization from the Court to: -- pay U.S. employees in the usual manner and to continue their healthcare and other benefits programs without disruption -- pay certain prepetition wages and reimbursable U.S. employee expenses -- maintain and administer customer programs and honor prepetition obligations to customers including all pending orders, warrantees, and other customer programs -- continue to use existing cash management systems and maintain existing bank accounts Antonio M. Perez, Chairman and Chief Executive Officer, stated, "The Court's immediate approval of these critical first day motions is an important first step, enabling us to continue to operate our U.S. business in ordinary course, and putting us on the right path to a successful reorganization." About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EASTMAN KODAK: Brighton Securities Lists 5 Things You Need to Know ------------------------------------------------------------------ Brighton Securities, a financial services firm in Rochester, NY established a Kodak hotline, community meetings and is answering questions live on social media as Rochester takes a psychological blow from Kodak filing Chapter 11. "Kodak is a company in our backyard," said George Conboy, president of Brighton Securities and expert on local, national, economic and business analysis. "Of the thousands of people impacted, there are nearly 25,000 Kodak retirees in the Greater Rochester area alone. People need to know what this means for them and our firm is answering the call. Brighton Securities is holding Community Resource Meetings for Kodak employees and retirees, helping to provide clear information at a time when rumor, half-truth, and urban legend have circulated throughout the community. Brighton Securities lists the top five things you need to know about Kodak now: SIP is seeing a major change. Effective Feb. 1, 2012, the Fixed Income Fund will change to a pure fixed-income fund. The difference with the new fund is that it will no longer carry the insurance "wrapper" designed to keep the value stable. With this material change, it may be time for participants to review all of their options for their SIP balance. KRIP (Kodak Retirement Income Plan) will now be subject to a PBGC (Pension Benefit Guarantee Corporation) audit as a routine consequence of the bankruptcy filing. This will likely take 2-3 months, and employees who terminate during that time will not have access to a lump-sum settlement option, though monthly pension payments would still be available and are secure. After the audit is complete the plan may be able to resume lump-sum settlements if the PBGC determines that the plan is adequately funded. Uncertainty about some aspects of retiree health insurance has cleared a bit. Some retirees pay their health insurance share to Kodak in advance. We had advised that retirees pay month-to-month to avoid ending up as an unsecured creditor. That concern has passed, and there should be no problem paying a few months ahead for those people who want the convenience of not writing a small check every month. Employees will keep their jobs and benefits - for now. Kodak will try to sell businesses (consumer is high on the list) but even if sold a lot of jobs will remain. Bankruptcy means reorganization for Kodak - not liquidation. The company will try to sell its patents and some business units with a plan to slim down and emerge a smaller and more profitable company. Estimated time in bankruptcy: about 18 months. As Kodak prepares to release its fourth quarter earnings on Jan. 26, Conboy will be available to answer questions and provide commentary and analysis. About Brighton Securities Brighton Securities -- http://www.brightonsecurities.com-- is an independently owned full-service financial firm headquartered in Rochester, N.Y. with a satellite office in Batavia, N.Y. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, voluntarily filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. are not included in the filing and will continue to operate as usual. The Company, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Having invested significantly in research and development for over a century, Kodak has a vast portfolio of patents. In 1975, Kodak scientists invented the first digital camera. Kodak then went on to develop a vast collection of patented technologies to enhance digital image capture and processing, technologies that are used in virtually every modern digital camera, smartphone and tablet, as well as numerous other devices. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Kodak disclosed $5.10 billion in assets and $6.75 billion in liabilities as of Sept. 30, 2011. The net book value of all assets located outside the United States as of Dec. 31, 2011 is $13.5 million. Kodak says it has "significant" legacy liabilities, which include $1.2 billion in non-U.S. pension liabilities, $1.3 billion of Other Post-Employment Benefit ("OPEB") liabilities and roughly $100 million in environmental liabilities. Kodak has outstanding funded debt in an aggregate amount of roughly $1.6 billion, consisting primarily of roughly: (a) $100 million outstanding under the first lien revolving credit facility plus an additional $96 million in face amount of outstanding letters of credit; (b) $750 million in principal amount of second lien secured notes; (c) $400 million in principal amount of convertible notes; and (d) $283 million in principal amount of other senior unsecured debt. Kodak also has roughly $425 million in outstanding trade debt. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtor. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. A group of second lien lenders are represented by Akin Gump Strauss Hauer & Feld LLP. Bankruptcy Creditors' Service, Inc., publishes EASTMAN KODAK BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Eastman Kodak and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). EUROCLASS MOTORS: Has Until Jan. 30 to Propose Chapter 11 Plan -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Puerto Rico, extended Euroclass Motors, Inc.'s exclusive periods to file and solicit acceptances for the proposed Plan of Reorganization until Jan. 30, 2012, and May 3, respectively. The extension will enable the Debtor to reconcile its claims and complete the negotiations to extend and renew its financing agreement with Reliable Holding Company, negotiations which will assist in the feasibility of the Plan. The Court ordered that it is the final extension of its exclusivity period. About Euroclass Motors San Juan, Puerto Rico-based Euroclass Motors, Inc. filed for Chapter 11 protection (Bankr. D. P.R. Case No. 11-05772) on July 6, 2011. Ramon Vega Diaz, president of the Debtor, filed the petition. The Chapter 11 case of Euroclass Motors, Inc., has been reassigned to the Hon. Mildred Caban Flores. The Debtor estimated assets between $1 million and $10 million and estimated debts between $10 million and $50 million. Charles Alfred Cuprill, at Charles A Cuprill, PSC Law Office, in San Juan, Puerto Rico, represents the Debtor in this case. Affiliate Autos Vega, Inc., is a car dealership engaged in the sales of new and used cars and trucks car parts, accessories and providing vehicle repair and maintenance, based in San Juan, Puerto Rico. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. P.R. Case No. 11-05773) on July 6, 2011. The Debtor disclosed $22,959,296 in assets and $34,224,323 in liabilities. EVERGREEN SOLAR: Lenders Claim $70.3MM Decline in Collateral Value ------------------------------------------------------------------ Certain unaffiliated holders of the 13% Convertible Senior Secured Notes due 2015, ask the U.S. Bankruptcy Court for the District of Delaware to determine that the value of the prepetition secured parties' adequate protection claims and liens as of the valuation date is $70.33 million. As set forth in the D&P Report (Expert Report of Brian J. Cullen and W. Christopher Bakewell, at 11), the aggregate diminution in value of the Prepetition Secured Parties' collateral since the Petition Date is $70.334 million. According to the Prepetition Secured Parties, during the course of the Chapter 11 case, diminution in value has occurred because: 1. the costs of Chapter 11 have placed an enormous burden on the Prepetition Secured Parties' prepetition collateral. The Debtor's cash collateral budget demonstrates that the Debtor is, and has been, burning cash each and every day, for a total postpetition expenditure of approximately $20.613 million. 2. the value of the Prepetition Secured Parties' non-cash collateral has decreased significantly during the chapter 11 case. 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. Hilco Industrial LLC serves as exclusive marketing and sales agent. Klehr Harrison Harvey Branzburg serves as special conflicts counsel. Zolfo Cooper LLC is the financial advisor. UBS Securities, LLC, serves as investment banker. 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. An official committee of unsecured creditors has retained Pepper Hamilton and Kramer Levin Naftalis & Frankel as counsel. The Committee tapped Garden City Group as communications services agent. Evergreen Solar is at least the fourth solar company to seek court protection from creditors since August 2011. Other solar firms are start-up Spectrawatt Inc., which also filed in August, Solyndra Inc., which filed early in September, and Stirling Energy Systems Inc., which filed for Chapter 7 bankruptcy late in September. At an auction in November, Evergreen Solar sold some of its core assets to Max Era Properties Limited. EVERGREEN SOLAR: Has Preliminary Settlement on Contested Claims --------------------------------------------------------------- Representatives of Evergreen Solar, Inc., attended a mediation session with representatives of the Official Committee of Unsecured Creditors of Evergreen Solar, Inc., certain unaffiliated holders of its 13% Convertible Senior Secured Notes due 2015, and U.S. Bank National Association, as the indenture trustee for the Secured Notes, seeking to settle certain contested matters and litigation including (i) the Motion of the Official Committee of Unsecured Creditors of Evergreen Solar, Inc., for an Order Pursuant to 11 U.S.C. Sections 105, 349, and 1112, and Fed. R. Bankr. P. 1017 and 2016 Dismissing Chapter 11 Case or Converting the Chapter 11 Case to a Chapter 7 Case and Granting Related Relief; (ii) the Motion of the Supporting Noteholders to Determine the Value of Adequate Protection Claims and Liens Granted Pursuant to the Cash Collateral Order; (iii) the Adversary Complaint for Declaratory Judgment, Avoidance of Liens and Disallowance of Claims; and (iv) the Indenture Trustee's Motion to Dismiss Claims Relating to Certain Foreign Intellectual Property of the Company. In connection therewith, the parties reached a preliminary, high- level framework for resolution of the Litigation and all other claims and causes of action among the parties, in each case subject in all respects to further discussion of relevant points and implementation mechanisms, as well as definitive documentation. Until such time as such further matters and definitive documentation are concluded, no agreement has been reached. In addition, any agreement would be subject to approval by the United States Bankruptcy Court for the District of Delaware. Pursuant to the preliminary framework: 1. The Indenture Trustee and the Supporting Noteholders would agree that the following assets will be available for distribution to administrative, priority and unsecured creditors: (i) amounts necessary to fund (a) professional fees to be paid consistent with the carve-out contained in the cash collateral order and (b) that certain wind-down budget filed with the Bankruptcy Court on Dec. 14, 2011, (ii) an additional $1.1 million of cash to be used to pay administrative and priority claims, including professional fees; (iii) an additional $200,000 carve-out for Company professionals' reasonable fees and expenses related to selling certain assets located in Devens, Massachusetts ($100,000 of which would be paid only from the proceeds of the sale of the Devens real estate, subject to certain conditions), as well as such assets; (iv) director and officer insurance claims, if any, and (v) certain other types of assets to be agreed, if any. 2. The Company, the Indenture Trustee and the Supporting Noteholders would agree that the following assets will be available for distribution solely to general unsecured creditors (i) 3.25 million shares of Ordinary Shares of China Private Equity Investment Holdings Limited received in connection with the Company's sale of its core assets; (ii) two causes of action; and (iii) $50,000 to administer such assets. 3. The parties would agree that on the effective date of the settlement, substantially all of the Company's assets other than the assets described in paragraphs 1 and 2 would be transferred to the Indenture Trustee for the benefit of the holders of the Secured Notes. To the extent the Company later identifies or receives additional assets, the Company would notify the Indenture Trustee of its right to take possession and if so requested, transfer the assets to the Indenture Trustee. The Company would also agree to take all reasonably feasible steps to close the sale of the Devens, Massachusetts assets and pay the net proceeds to the Indenture Trustee immediately upon closing. 4. The parties would agree to waive and not pursue potential pre- bankruptcy preferential transfers to unsecured creditors if the amount of the transfer was less than $60,000. 5. The parties would agree that the Company would pursue confirmation and consummation of a chapter 11 plan of liquidation to the extent reasonably feasible consistent with the settlement. The parties would also stipulate to the validity and amount of the Indenture Trustee's deficiency claim. The Indenture Trustee's deficiency claim would not share in any distributions to unsecured creditors until other allowed unsecured claims have recovered 1%. 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. Hilco Industrial LLC serves as exclusive marketing and sales agent. Klehr Harrison Harvey Branzburg serves as special conflicts counsel. Zolfo Cooper LLC is the financial advisor. UBS Securities, LLC, serves as investment banker. 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. An official committee of unsecured creditors has retained Pepper Hamilton and Kramer Levin Naftalis & Frankel as counsel. The Committee tapped Garden City Group as communications services agent. Evergreen Solar is at least the fourth solar company to seek court protection from creditors since August 2011. Other solar firms are start-up Spectrawatt Inc., which also filed in August, Solyndra Inc., which filed early in September, and Stirling Energy Systems Inc., which filed for Chapter 7 bankruptcy late in September. At an auction in November, Evergreen Solar sold some of its core assets to Max Era Properties Limited. FERTITTA MORTON: Moody's Assigns 'B2' Rating to Term Loan --------------------------------------------------------- Moody's Investors Service assigned a B2 rating to Fertitta Morton's Restaurants, Inc.'s (Fertitta Morton's) proposed $190 million guaranteed senior secured term loan and $15 million revolving credit facility. Moody's also assigned Fertitta Morton's a B3 Corporate Family Rating (CFR) and Caa1 Probability of Default Rating (PDR). The rating outlook is stable. RATINGS RATIONALE Proceeds from the proposed term loan and revolver will be used by Fertitta Morton's to fund the acquisition of Morton's Restaurant Group, Inc., re-finance the existing debt of Claim Jumper Restaurants, Inc. and the merger of these two restaurant concepts as wholly owned subsidiaries of Fertitta Morton's. Ratings are subject to final documentation. This is the first time Moody's rates this debt for Fertitta Morton's. Ratings assigned are: Corporate Family Rating at B3 Probability of Default Rating at Caa1 $15 million guaranteed senior secured 1st lien revolver due 2016 at B2 (LGD 2, 28%) $190 million guaranteed senior secured 1st lien term loan due 2017 at B2 (LGD 2, 28%) The rating outlook is stable The B3 Corporate Family Rating of Fertitta Morton's reflects its high pro forma leverage of about 6.5 times (before realization of any cost synergies) and the uncertainty as to the timing and extent to which proposed synergies and cost saving can be realized. The ratings also reflect the company's modest scale versus some of its peers, the weak same store sales performance of its Claim Jumper concept, and Moody's expectation that historically high unemployment and high levels of promotional activities by competitors will continue to pressure operating performance. The ratings are supported by the high level of brand awareness of Morton's Restaurants, the company's good liquidity, and an expectation that some level of costs savings will be realized through its management agreement with Landry's Inc. The stable rating outlook reflects Moody's view that debt protection metrics will gradually improve over the next twelve months as operating earnings benefit from the realization of a certain level of cost savings, despite soft consumer spending. The outlook also reflects Moody's expectation that the company will maintain good liquidity. Factors that could result in an upgrade would include a permanent strengthening of debt protection metrics driven by a sustained improvement in operating earnings. Specifically, a higher rating would require debt to EBITDA of below 5.75 times and EBITA coverage of gross interest of over 1.5 times. An upgrade would also require good liquidity. An inability to strengthen debt protection metrics from current levels over the next twelve to eighteen months could result in downward rating pressure. Specifically, a downgrade could occur if the company is unable to reduce Debt to EBITDA towards 6.0 times and improve EBITA to interest coverage to over 1.15 times. A deterioration in liquidity could also result in a downgrade. As of the close of the transaction and before realization of any cost synergies, pro forma leverage is expected to be about 6.5 times. The principal methodology used in rating Fertitta Morton's Restaurants, Inc. was the Global Restaurant Industry 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. Fertitta Morton's Restaurants, Inc. will be the owner operator of two restaurant concepts, Morton's Steakhouse and Claim Jumper Restaurant. Pro forma annual revenues are expected to be approximately $450 million in fiscal year 2011. FILENE'S BASEMENT: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Filene's Basement LLC has filed with the U.S. Bankruptcy Court for the District of Delaware its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property B. Personal Property $90,093,167 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $33,220,760 E. Creditors Holding Unsecured Priority Claims F. Creditors Holding Unsecured Non-priority Claims $50,587,775 ----------- ----------- TOTAL $90,093,167 $83,808,536 Copies of the Company's schedules of assets and liabilities and statement of financial affairs are available for free at: http://bankrupt.com/misc/FILENES_BASEMENT_Schedules.pdf http://bankrupt.com/misc/FILENES_BASEMENT_SOFA.pdf About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FILENE'S BASEMENT: Syms Files Schedules of Assets & Liabilities --------------------------------------------------------------- Syms Corp. has filed with the U.S. Bankruptcy Court for the District of Delaware its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $63,250,083 B. Personal Property $139,314,750 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $33,220,760 E. Creditors Holding Unsecured Priority Claims F. Creditors Holding Unsecured Non-priority Claims $35,122,944 ----------- ----------- TOTAL $202,564,833 $68,343,704 Copies of the Company's schedules of assets and liabilities and statement of financial affairs are available for free at: http://bankrupt.com/misc/FILENES_BASEMENT_Syms_Schedules.pdf http://bankrupt.com/misc/FILENES_BASEMENT_Syms_SOFA.pdf About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FILENE'S BASEMENT: Committee Retains Abacus as Consultants ---------------------------------------------------------- The Official Committee of Unsecured Creditors of Filene's Basement, LLC and its Debtor affiliates seeks authority from the U.S. Bankruptcy Court for the District of Delaware to retain Abacus Advisors Group LLC as real estate and liquidation consultants to the Committee, nunc pro tunc to December 8, 2011. As consultants, Abacus will, among other things: -- monitor the conduct and results of store closing sales, and the expense budgets and actual expenses associated with selling the Debtors' inventory and furniture, fixtures, and equipment; -- assist with any negotiations with various parties-in- interest to ensure maximum recoveries, minimum expenses, and a swift conclusion to the store closing sale process; -- identify additional proposed purchasers of select business operations and assets; and -- review and supplement, if appropriate, the information package distributed to potential purchasers of any of the Debtors' assets, and review all proposals that have been or will be received by the Debtors for the purchase of their business and assets. The firm's hourly rates are: Classification Rates -------------- ----- Managing Directors $550 - $700 Executive Managers $400 - $500 Associates $300 - $375 Clerical Staff $150 - $250 Alan Cohen, Chairman of Abacus assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A hearing will be held on February 8, 2012, to consider the application. Objections are due on February 1. About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FILENE'S BASEMENT: Equity Committee Retains RCS as Consultant ------------------------------------------------------------- The Official Committee of Syms Corp. Equity Security Holders in the Chapter 11 bankruptcy cases of Filene's Basement, LLC and its Debtor affiliates seeks authority from the U.S. Bankruptcy Court for the District of Delaware to retain Retail Consulting Services, Inc., doing business as RCS Real Estate Advisors, as its real estate consultant, nunc pro tunc to December 7, 2011. Upon retention, RCS will, among other things: -- assist the Equity Committee in evaluating and analyzing real estate issues and opportunities related to Syms's owned and the Debtors' leased properties; -- with respect to Syms's owned properties, monitor the activities of Cushman & Wakefield Securities, Inc., as Real Estate Financial Advisor and Cushman & Wakefield, Inc., as Real Estate Broker, to the extent retained by the Debtors; -- with respect to Syms's owned properties, review and supplement existing appraisal methodologies; and -- with respect to Syms's owned properties, review and supplement the potential investor list. The firm's hourly rates are: Personnel Rate --------- ---- President and CEO $750 Senior Vice President $600 Vice President $500 Paralegal/Admin. Assistant $100 Pursuant to the parties' Engagement Letter, RCS's total compensation, not including reimbursement of expenses, will be capped at $150,000. Ivan L. Friedman, President and CEO of RCS, attests that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FILENE'S BASEMENT: Allowed to Hire BDO USA as Accountants --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Filene's Basement, LLC and its debtor-affiliates to employ BDO USA, LLP, as their accountants and auditors, nunc pro tunc to Nov. 7, 2011. About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FILENE'S BASEMENT: Court OKs Hilco as Real Estate Consultant ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Filene's Basement, LLC and its Debtor affiliates to employ Hilco Real Estate, LLC, as real property lease consultant, nunc pro tunc to the Petition Date. The Court also approved Hilco's fee structure, expense reimbursements and indemnification provisions as set forth in the parties' engagement agreement. About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FILENE'S BASEMENT: Hilco Streambank OK'd as IP Consultant --------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware approved the application of Filene's Basement, LLC and its Debtor affiliates to employ Hilco IP Services LLC, doing business as Hilco Streambank, as their intellectual property disposition consultant, nunc pro tunc to the Petition Date. Hilco Streambank's fee structure, reimbursable expenses and indemnification provisions as set forth in the parties' retention letter are also approved. The Court also ruled that Hilco Streambank's commission, which is based on a percentage of aggregate gross proceeds generated from the sale, assignment, license or other disposition of the Intellectual Property, is: * 6% of the first $3 million of aggregate Gross Proceeds; * 7.5% for any aggregate Gross Proceeds in excess of $3 million and up to $5 million; and * 10% for any Gross Proceeds in excess of $5 million. To the extent that Hilco Streambank earns a fee based on Gross Proceeds that include "non-cash consideration", the Court advised Hilco Streambank to consult with the counsel of all official committees concerning the "value" of the "non-cash consideration", as contemplated by the Retention Letter. To the extent that Hilco Streambank earns a fee based on a transaction that includes one or more deferred payments to the Debtors' estates, the portion of Hilco Streambank's fee attributable to the Deferred Payments will not be paid to Hilco Streambank until the time or times as the Deferred Payments are received by the estates or the Debtors' successors-in-interest. About Filene's Basement & Syms Corp. Massachusetts-based Filene's Basement, also called The Basement, is the oldest off-price retailer in the United States. The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures, Inc., the following year. Retail Ventures in April 2009 transferred the unit to Buxbaum. Filene's Basement, Inc. and its affiliates filed for Chapter 22 (Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy Solutions serves as claims and notice agent. The Debtors disclosed assets of $236 million, including real estate of $97.7 million, and liabilities of $94 million, including $31.1 million owing on a revolving credit with Bank of America NA as agent. In addition, there were $11.1 million in letters of credit outstanding on the revolver. The 2009 Debtor was formally renamed FB Liquidating Estate, following the sale of all of its assets to Syms Corp. in June 2009. Pursuant to the Liquidating Plan confirmed in January 2010, secured creditors in the Chapter 11 case have been paid in full, and holders of priority, administrative and convenience class claims have received 100% of their allowed claims. As reported by the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen, Chairman of Abacus Advisors LLC and Chief Restructuring Officer for FB Liquidating Estate disclosed that a second distribution of dividend checks to Filene's unsecured creditors amounting to 12.5% of approved claims has been made, bringing the cumulative distributions on unsecured claims to 62.5%. On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 11-13511 to 11-13514) after a failed bid to sell the business. The two units are Syms Clothing Inc. and Syms Advertising Inc. Judge Kevin J. Carey presides over the case. Lawyers at Skadden Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The Debtors tapped Rothschild Inc. as investment banker and Cushman and Wakefield Securities, Inc., as real estate financial advisors. Syms shuttered its namesake and Filene's Basement outlets upon the bankruptcy filing and tapped a joint venture of Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC to run the going-out-of-business sales. The sale may continue until Jan. 31, 2012. Filene's Basement estimated $1 million to $10 million in assets and $50 million to $100 million in debts. The petitions were signed by Gary Binkoski, authorized representative of Filene's Basement. The official committee of unsecured creditors appointed in the 2011 case has retained Hahn & Hessen LLP as legal counsel. Holders of equity in Syms Corp. pushed for an official shareholders' committee and separation of the Syms and Filene's Basement bankruptcy estates. Gordon Brothers and Hilco are represented by Goulston & Storrs, P.C. and Ashby & Geddes, P.A. FIRST STATE: Closed; Hamilton State Bank Assumes All Deposits ------------------------------------------------------------- The First State Bank of Stockbridge, Ga., was closed on Friday, Jan. 20, 2012, by the Georgia Department of Banking and Finance, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Hamilton State Bank of Hoschton, Ga., to assume all of the deposits of The First State Bank. The seven branches of The First State Bank will reopen during their normal business hours as branches of Hamilton State Bank. Depositors of The First State Bank will automatically become depositors of Hamilton State 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 First State Bank should continue to use their existing branch until they receive notice from Hamilton State Bank that it has completed systems changes to allow other Hamilton State Bank branches to process their accounts as well. As of Sept. 30, 2011, The First State Bank had around $536.9 million in total assets and $527.5 million in total deposits. Hamilton State Bank will pay the FDIC a premium of 0.50% to assume all of the deposits of The First State Bank. In addition to assuming all of the deposits of the failed bank, Hamilton State Bank agreed to purchase essentially all of the assets. The FDIC and Hamilton State Bank entered into a loss-share transaction on $419.5 million of The First State Bank's assets. Hamilton State 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 1-800-405-8251. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/firststatebank-ga.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $216.2 million. Compared to other alternatives, Hamilton State Bank's acquisition was the least costly resolution for the FDIC's DIF. The First State Bank is the second FDIC-insured institution to fail in the nation this year, and the first in Georgia. The last FDIC-insured institution closed in the state was Community Bank of Rockmart, Rockmart, on Nov. 10, 2011. FLORIDA STATE BANK: Closed; CenterState Bank Assumes All Deposits ----------------------------------------------------------------- Central Florida State Bank of Belleview, Fla., was closed on Friday, Jan. 20, 2012, by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with CenterState Bank of Florida, National Association, of Winter Haven, Fla., to assume all of the deposits of Central Florida State Bank. The four branches of Central Florida State Bank will reopen during normal business hours as branches of CenterState Bank of Florida, National Association. Depositors of Central Florida State Bank will automatically become depositors of CenterState Bank of Florida, National Association. 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 Central Florida State Bank should continue to use their existing branch until they receive notice from CenterState Bank of Florida, National Association, that it has completed systems changes to allow other CenterState Bank of Florida, National Association, branches to process their accounts as well. As of Sept. 30, 2011, Central Florida State Bank had around $79.1 million in total assets and $77.7 million in total deposits. In addition to assuming all of the deposits of the failed bank, CenterState Bank of Florida, National Association, agreed to purchase essentially all of the assets. The FDIC and CenterState Bank of Florida, National Association, entered into a loss-share transaction on $53.6 million of Central Florida State Bank's assets. CenterState Bank of Florida, National Association, will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html Customers with questions about the transaction should call the FDIC toll-free at 1-800-405-8028. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/cfsb.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $24.4 million. Compared to other alternatives, CenterState Bank of Florida, National Association's acquisition was the least costly resolution for the FDIC's DIF. Central Florida State Bank is the first FDIC-insured institution to fail in the nation this year, and the first in Florida. The last FDIC- insured institution closed in the state was Premier Community Bank of the Emerald Coast, Crestview, on Dec. 16, 2011. FRIENDLY ICE: Court OKs Sale of All Assets to Sundae Group ---------------------------------------------------------- The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware authorized Friendly Ice Cream Corporation, et al., to: -- sell all or substantially all assets to Sundae Group Holdings II, LLC; -- assume and assign certain executory contracts and unexpired leases. As reported in the Troubled Company Reporter on Jan. 2, 2012, Friendly Ice Cream Corp. will be sold to an affiliate of the existing owner Sun Capital Partners Inc. in exchange for debt. The Sun Capital affiliate will pay about $120 million, including enough cash to off first-lien debt. Most of the remainder is a credit bid from the $267.7 million in second-lien, pay-in-kind notes that a Sun Capital affiliate owns. Pursuant to the order, the wind-down budget will be funded by the purchaser at closing into a segregated account to be designated by the Debtors in an amount equal to $11,257,881, including $8,487,268 previously funded pursuant to the final order approving and authorizing the Debtors' postpetition debtor-in-possession facility for fees and expenses incurred by the professionals retained by the Debtors or the Committee. About Friendly Ice Cream 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. 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 one of two companies 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 Delaware bankruptcy court on Oct. 3, 2011. On Oct. 12, 2011, the U.S. Trustee appointed the Committee. The Committee currently consists of seven members. The Committee selected Akin Gump Straus Hauer & Feld LLP and Blank Rome LLP to serve as co-counsel to the Committee, and FTI Consulting to serve as the Committee's financial advisor. FURNITURE BY THURSTON: Files Schedules of Assets and Liabilities ---------------------------------------------------------------- Furniture by Thurston filed with the U.S. Bankruptcy Court for the Western District of Texas its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $15,375,120 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $17,228,789 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $7,999,183 ----------- ----------- TOTAL $15,375,120 $25,227,972 A full-text copy of the schedules is available for free at: http://bankrupt.com/misc/FURNITUREBY_sal.pdf San Antonio, Texas-based KLN Steel Products Company LLC, Dehler Manufacturing Co. Inc., and Furniture by Thurston manufacture and market high quality furniture for multi-person housing facilities and packaged services for federal government offices and dormitory facilities. They have two manufacturing facilities. One in San Antonio, Texas, which is consolidated and designed to accommodate high volume fabrication of standard and semi-custom steel furniture and casegoods of high quality for colleges and universities, military quarters, and job corps centers, or wherever high quality, long life, low maintenance furniture is essential. The facility includes a manufacturing facility of more than 170,000 square feet capable of producing substantial projects on a timely basis. The second facility is located in Grass Valley, California, with more than 61,000 square feet dedicated to the manufacturing of wood furniture for military and university housing. KLN Steel filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-12855) on Nov. 22, 2011. Dehler (Case No. 11-12856) and Furniture by Thurston (Case No. 11-12858) filed on the same day. Judge Craig A. Gargotta were originally assigned to the KLN and Dehler cases. The Furniture by Thurston case was given to Judge H. Christopher Mott. Judge Mott now oversees all three cases. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as the Debtors' counsel. Each of the Debtors estimated assets and debts of $10 million to $50 million. The petition was signed by Edward J. Herman, president. GAS CITY: Settles With BofA; Chapter 11 Case Dismissed ------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Illinois Gas City, Ltd. et al., approved the procedures for (i) distribution of remaining funds under a global settlement agreement and (ii) dismissal of the Debtors' Chapter 11 cases. The Court found that the Debtors lack sufficient funds to formulate, confirm or effectuate a Chapter 11 Plan. Pursuant to the order, the Section 507(b) claim in favor of the Bank of America will be allowed in the amount of $2,026,954, subject to adjustment based on the amount of the unencumbered proceeds finally allocated from the proceeds of Station 151. The Court also ordered that the Debtors will distribute the remaining Station proceeds in their possession and any remaining proceeds of the Gas City working capital assets as, among other things: 1. Station Lender Holdback: The Debtors will indefeasibly pay 90% of the Station Lender Holdback to the Station lenders, respectively, and to use the remaining 10% of the Station Lender Holdback to pay allowed and unpaid non-professional administrative expenses, provided, however, that Standard Bank will receive 100% of its Station Lender Holdback, and any distribution of the Station Lender Holdback to First Community Bank will be subject to further agreement, stipulation or Court order. b. Unsecured Creditor Pool. The amount of Unsecured Creditor Pool is $1,457,562. The Debtors will distribute $250,000 of the Unsecured Creditor Pool to GUC Disbursing Agent, for further distribution on a pro rata basis to holders of allowed general unsecured claims against Gas City under the Distribution Guidelines approved hereby, each in accordance with the Global Settlement Agreement. The $1,207,562 balance of the Unsecured Creditor Pool will be paid to Bank of America on account of Section 507(b) claim. c. Unemcumbered Proceeds. The Debtors are authorized to distribute $675,000 of the Unemcumbered Proceeds to the Administrative Claim Pool, and the $819,392 balance of the Unemcumbered Proceeds in the Debtors' possession as of the date hereof will be distributed to BofA on account of Section 507(b) claim. About Gas City Gas City Ltd. -- http://www.gascity.net/-- based in Frankfort, Illinois, is an independent petroleum marketer with locations in Northeast Illinois, Northwest Indiana, Florida and Arizona. Gas City sought Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 10-47879) on Oct. 26, 2010, estimating assets at $50 million to $100 million and debts at $100 million to $500 million. Gas City's parent, the William J. McEnery Revocable Trust dated Apr. 22, 1993, filed a separate Chapter 11 petition (Bankr. N.D. Ill. Case No. 10-47895). Paul V. Possinger, Esq., Mark K. Thomas, Esq., Grayson T. Walter, Esq., at Proskauer Rose LLP, in Chicago; and Daniel A. Zazove, Esq., and Kathleen A. Stetsko, Esq., at Perkins Coie LLP, in Chicago, represent the Debtors. A. Jeffrey Zappone at Conway Mackenzie is the Debtors' chief restructuring officer. Kurtzman Carson Consultants is the Debtors' claims agent. Gas City disclosed $66,307,812 in assets and $209,577,690 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors has tapped Pachulski Stang Ziehl & Jones LLP and Levenfeld Pearlstein, LLC, as co- counsel and Mesirow Financial Consulting, LLC, as financial advisors. GATEHOUSE MEDIA: Bank Debt Trades at 76% Off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which GateHouse Media, Inc., is a borrower traded in the secondary market at 23.73 cents- on-the-dollar during the week ended Friday, Jan. 20, 2012, an increase of 1.07 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 200 basis points above LIBOR to borrow under the facility. The bank loan matures on Feb. 27, 2014, and carries Moody's Ca rating and Standard & Poor's CCC- rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About GateHouse Media GateHouse Media, Inc. -- http://www.gatehousemedia.com/-- headquartered in Fairport, New York, is one of the largest publishers of locally based print and online media in the United States as measured by its 97 daily publications. GateHouse Media currently serves local audiences of more than 10 million per week across 21 states through hundreds of community publications and local Web sites. The Company reported a net loss of $28.42 million on $381.35 million of total revenues for the nine months ended Sept. 25, 2011, compared with a net loss of $27.74 million on $415.22 million of total revenues for the nine months ended Sept. 30, 2010. The Company reported a net loss of $26.64 million on $558.58 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $530.61 million on $584.79 million of total revenue for the year ended Dec. 31, 2009. The Company's balance sheet at Sept. 25, 2011, showed $511.80 million in total assets, $1.32 billion in total liabilities and a $811.28 million total stockholders' deficit. GENERAL MARITIME: Files Schedules of Assets and Liabilities ----------------------------------------------------------- General Maritime Corporation filed with the U.S. Bankruptcy Court for the Southern District of New York its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $1,201,124,132 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $1,073,598,088 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $429,777,197 ----------- ----------- TOTAL $1,201,124,132 $1,503,375,285 A full-text copy of the schedules is available for free at: http://bankrupt.com/misc/GeneralMaritime_SAL.pdf Previously, the Court approved the stipulation with the Official Committee of Unsecured Creditors extending until Jan. 17, 2012, the Debtors' time to file their schedules of assets and liabilities and statements of financial affairs. About General Maritime New York-based General Maritime Corporation, through its subsidiaries, provides international transportation services of seaborne crude oil and petroleum products. The Company's fleet is comprised of VLCC, Suezmax, Aframax, Panamax and product carrier vessels. The fleet consisted of 30 owned vessels and three chartered vessels. The company generates substantially all of its revenues by chartering its fleet to third-party customers. The largest customers include major international oil companies, oil producers, and oil traders such as BP, Chevron Corporation, CITGO Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess Corporation, Lukoil Oil Company, Stena AB, and Trafigura. General Maritime and 56 subsidiaries filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17, 2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer Levin Naftalis & Frankel LLP, in New York, serve as counsel to the Debtors. Moelis & Company is the financial advisor. Garden City Group Inc. is the claims and notice agent. General Maritime disclosed $1,718,598,000 in assets and $1,412,900,000 in liabilities as of Sept. 30, 2011. General Maritime's publicly held securities include 121.5 million common shares and $300 million in unsecured 12% notes due 2017. Prepetition, General Maritime reached agreements with its key senior lenders, including its bank group, led by Nordea Bank Finland plc, New York Branch as administrative agent, as well as affiliates of Oaktree Capital Management, L.P., on the terms of a restructuring. Under terms of the agreements, Oaktree will provide a $175 million new equity investment in General Maritime and convert its prepetition secured debt to equity. In conjunction with the filing, General Maritime has received a commitment for up to $100 million in new DIP financing from a group of lenders led by Nordea as administrative agent. Counsel for Nordea, as the DIP Agent and the Senior Agent, are Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case LLP. Counsel for Oaktree Capital Management, the Junior Agent, are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland & Ellis, LLP. The Official Committee of Unsecured Creditors appointed in the case has retained lawyers at Jones Day as Chapter 11 counsel. Jones Day previously represented an ad hoc group of holders of the 12% Senior Notes due 2017 issued by General Maritime Corp. This representation began Sept. 20, 2011, and concluded Nov. 29, 2011, with the agreement of all members of the Noteholders Committee. The Creditors Committee also tapped Lowenstein Sandler PC as special conflicts counsel. The Noteholders Committee consisted of Capital Research and Management Company, J.P. Morgan Investment Management, Inc., J.P. Morgan Securities LLC, Stone Harbor Investment Partners LP and Third Avenue Focused Credit Fund. The Creditors Committee is comprised of Bank of New York Mellon Corporate Trust, Stone Harbor Investment Partners, Delos Investment Management, and Ultramar Agencia Maritima Ltda. GSC GROUP: BDCM Files 4th Amended Plan, Gets Trustee Support ------------------------------------------------------------ Black Diamond Capital Management, L.L.C. on Dec. 30, 2011 filed a Fourth Amended Joint Chapter 11 Plan and Disclosure Statement for GSC Group, Inc. and its affiliated debtors. The latest version of the BDCM Plan, according to managing principal Stephen H. Deckoff, is a plan of reorganization under which the Reorganized Debtors will continue the operation of the Debtor's existing investment management business. BDCM maintains that its proposed plan is a more preferable and value-preserving alternative to the GSC Chapter 11 Trustee's Modified Joint Plan. The Trustee Plan contemplates the winddown and liquidation of the Debtors. The BDCM Plan provides more attractive treatment for general unsecured claims and preferred equity holders than the Trustee Plan. 1. The BDCM Plan offers all unsecured creditors three recovery options from which to select rather than just the single recovery option the Chapter 11 Trustee offered. Unsecured creditor can choose (1) a fast cash payout; (2) a partial cash payment close to the Effective Date plus a delayed cash payout from the proceeds of the Liquidating Trust; or (3) shares of Reorganized GSC Group Series B Preferred Stock and shares of Reorganized GSC Group Convertible Class B Common Stock, which will comprise between 33% and 49%, at BDCM's discretion, of the Reorganized GSC Group Common Stock with 24.9% of the voting rights. If a holder of an Allowed General Unsecured Claim elects the "Upfront Cash Option," it will be entitled to its pro rata share of $6.6. million. If such holder elects the "Combination Cash Option," it will be entitled to its pro rata share of %5.6 million plus its pro rata share of units in the Liquidating Trust. The Trustee Plan contains only one option, for general unsecured creditors to receive its pro rata share of only up to $4.6 million. 2. The BDCM Plan provides that Preferred Equity Interest holders will receive shares of Reorganized GSC Group's Class A Common Stock equal to between 51% and 67%, at BDCM's discretion, of the total GSC Common Stock, while the Trustee Plan does not provide any recovery for the interest holders. A blacklined version of the BDCM 4th Amended Disclosure Statement is available for free at: http://bankrupt.com/misc/GSCGrp_DS4thAmdDec30.PDF Trustee Agrees to Support BDCM Plan BDCM relates that pursuant to a Dec. 20, 2011 Court-approved stipulation, the Chapter 11 Trustee has agreed to support the BDCM Plan. To this end, the Chapter 11 Trustee has adjourned seeking confirmation of its Plan while BDCM solicit votes on the BDCM Plan and pursues plan confirmation. In the event the BDCM Plan is confirmed and consummated by Mar. 31, 2012, the Chapter 11 Trustee will abandon pursuing Court approval of the Trustee Plan. In return, BDCM has provided the Chapter 11 Trustee with $1 million to satisfy allowed Chapter 11 professional fees and agreed to provide $4 million in escrow funds for the Reorganized Debtors to use to satisfy any "Straddle Tax" (i.e., any income tax liability required to be paid had the Effective Date occurred on or before Dec. 31, 2011). Plan-Related Deadlines To be counted, the BDCM Plan proposes that Feb. 10, 2012, be set as the plan voting deadline. BDCM also proposes that Feb. 22, 2012 be set as the confirmation hearing and that objections to confirmation be submitted no later than Feb. 10, 2012, at 4:00 p.m. prevailing Eastern time. About GSC Group Florham Park, New Jersey-based GSC Group, Inc. -- http://www.gsc.com/-- was a private equity firm that specialized in mezzanine and fund of fund investments. Originally named Greenwich Street Capital Partners Inc. when it was a subsidiary of Travelers Group Inc., GSC became independent in 1998 and at one time had $28 billion of assets under management. Market reverses, termination of some funds, and withdrawal of customers' investments reduced funds under management at the time of bankruptcy to $8.4 billion. GSC Group, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010. Michael B. Solow, Esq., at Kaye Scholer LLP, served as the Debtor's bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice and claims agent. Capstone Advisory Group LLC served as the Debtor's financial advisor. The Debtor estimated its assets at $1 million to $10 million and debts at $100 million to $500 million as of the Chapter 11 filing. Since Jan. 7, 2011, the Debtors have been operated by James L. Garrity Jr., as Chapter 11 trustee for the Debtors. The Chapter 11 trustee tapped Shearman & Sterling LLP as his counsel, and Togut, Segal & Segal LLP as his conflicts counsel. No committee of unsecured creditors has been appointed in the case. The Chapter 11 trustee completed the sale of business in July 2011 and filed a liquidating Chapter 11 plan and explanatory disclosure statement in late August. The bankruptcy court authorized the trustee to sell the business to Black Diamond Capital Finance LLC, as agent for the secured lenders. Proceeds were used to pay secured claims. The price paid by the lenders' agent was designed for full payment on $256.8 million in secured claims, with $18.6 million cash left over. Black Diamond bought most assets with a $224 million credit bid, a $6.7 million note, $5 million cash, and debt assumption. A minority group of secured lenders filed an appeal from the order allowing the sale. Through a suit in state court, the minority lenders failed to halt Black Diamond from completing the sale. The Chapter 11 Trustee and Black Diamond have filed rival repayment plans for GSC Group. As reported in the TCR on Dec. 16, 2011, Hilary Russ at Bankruptcy Law360 related that the Chapter 11 trustee for GSC Group, Inc., reached a handshake deal on Dec. 13, 2011, ending a bitter dispute with Black Diamond that delayed a $235 million asset sale. Adam Goldberg, Esq., and Douglas Bacon, Esq., at Latham & Watkins, represent Black Diamond Capital Management, LLC, as counsel. Patrick J. Nash, Jr., Esq. and Paul Wierbicki, Esq. of Kirkland & Ellis LLP serve as counsel to Black Diamond Capital Management, LLC. GSW HOLDINGS: Must Pay Hancock on Sales of Hunter Chase Lots ------------------------------------------------------------ Judge Katherine M. Samson granted Hancock Bank's motion to prohibit GSW Holdings, LLC's use of cash collateral and request for adequate protection. The Debtor, in August 2011, executed a renewal promissory note to Hancock Bank in the principal amount of $259,271. The loan, which is secured by 43 lots in the Hunter Chase Subdivision, Gulfport, Harrison County, Mississippi, has matured and continues to accrue interest. As the Debtors continued efforts to sell the Hunter Chase lots in bankruptcy, Hancock told the Court it does not consent to the use of its cash collateral saying it is not adequately protected. Judge Samson authorizes the Debtor to sell the Hunter Chase lots in the ordinary course of business; provided that as each lot is sold, Hancock will be paid the greater of 85% of the sales price or $27,200 for the release of the lot being sold. Moreover, the Court specifically directed to pay Hancock $1,500 without delay, $3,000 on or before Jan. 15, 2012, and $3,000 on or before Apr. 15, 2012. About GSW Holdings LLC Gulfport, Mississippi-based GSW Holdings LLC filed for Chapter 11 bankruptcy (Bankr. S.D. Miss. Case No. 11-52338) on Oct. 11, 2011. Judge Katharine M. Samson presides over the case. Wheeler & Wheeler serves as its local bankruptcy counsel. The Debtor disclosed $22,225,500 in assets and $8,851,228 in liabilities. HABERSHAM BANCORP: Knight Capital Discloses 5.6% Equity Stake ------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Knight Capital Americas, L.P., formerly Knight Equity Markets, L.P., disclosed that, as of Dec. 30, 2011, it beneficially owns 159,902 shares of common stock of Habersham Bancorp, Inc., representing 5.67% based on outstanding shares reported on the Company's 10-Q filed with the SEC for period ended Sept. 30, 2010. A full-text copy of the Schedule 13G is available for free at http://is.gd/odsN7s About Habersham Bancorp Cornelia, Ga.-based Habersham Bancorp (OTC BB: HABC) owns all of the outstanding stock of Habersham Bank and an inactive subsidiary, The Advantage Group, Inc. The Company's continuing primary business is the operation of banks in rural and suburban communities in Habersham, White, Cherokee, Warren, Stephens, and Hall counties in Georgia. The Company's balance sheet as of Sept. 30, 2010, showed $396.3 million in total assets, $386.6 million in total liabilities, and stockholders' equity of $9.7 million. As reported in the Troubled Company Reporter on April 5, 2010, Porter Keadle Moore, LLP, in Atlanta, Ga., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that at Dec. 31, 2009, Habersham Bank's total capital to risk-weighted assets and Tier I capital to average assets ratios are below the required levels as established by regulation. In addition, the Bank has suffered recurring operating losses. * * * The Georgia Department of Banking and Finance closed Habersham Bancorp's subsidiary bank, Habersham Bank, and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. Habersham Bancorp is no longer the parent of Habersham Bank. In a virtually simultaneous transaction, SCBT National Association acquired the operations and all deposits and purchased essentially all assets of the Bank in a loss-share transaction facilitated by the FDIC and will continue to operate the Bank. HANMI FINANCIAL: Posts $5.5 Million Net Income in Fourth Quarter ---------------------------------------------------------------- Hanmi Financial Corporation reported net income of $5.50 million on $30.64 million of total interest and dividend income for the three months ended Dec. 31, 2011, compared with net income of $5.31 million on $34.61 million of total interest and dividend income for for the same period a year ago. The Company reported net income of $28.14 million on $128.80 million of total interest and dividend income for the year ended Dec. 31, 2011, compared with a net loss of $88.01 million on $144.51 million of total interest and dividend income during the prior year. The Company's balance sheet as of Dec. 31, 2011, showed $2.74 billion in total assets, $2.45 billion in total liabilities and $285.61 million in stockholders' equity. "2011 was a year of great transformation for Hanmi. With hard work and dedication of all our employees, we have overcome many challenges and have already implemented steps to continue on the road to profitability," said Jay S. Yoo, President and Chief Executive Officer. "We launched the new year with an all-company rally that brought the entire Hanmi team together. I was impressed with the dedication and enthusiasm that our team members demonstrated at the rally. We are once again dedicated to make Hanmi 'The Bank of Choice' for our customers, our employees, our communities, and our shareholders." A full-text copy of the press release is available at: http://is.gd/I2laQ8 About Hanmi Financial Headquartered in Los Angeles, California, Hanmi Financial Corp. (Nasdaq: HAFC) -- http://www.hanmi.com/-- is the holding company for Hanmi Bank, a state chartered bank with headquarters located at 3660 Wilshire Boulevard, Penthouse Suite A, in Los Angeles. Hanmi Bank provides services to the multi-ethnic communities of California, with 27 full-service offices in Los Angeles, Orange, San Bernardino, San Francisco, Santa Clara and San Diego counties, and a loan production office in Washington State. Going Concern The Company is required by federal regulatory authorities to maintain adequate levels of capital to support its operations. Hanmi Bank is also required to increase its capital and maintain certain regulatory capital ratios prior to certain dates specified in a Final Order issued by the California Department of Financial Institutions. By July 31, 2010, the Bank was required to increase its contributed equity capital by not less than an additional $100 million and maintain a ratio of tangible stockholders' equity to total tangible assets of at least 9.0%. In addition, the Bank was also required to maintain a ratio of tangible stockholders' equity to total tangible assets of at least 9.5 percent at Dec. 31, 2010 and until the Final Order is terminated. As a result of the successful completion of the registered rights and best efforts offering in July 2010, the capital contribution requirement set forth in the Final Order was satisfied. However, the tangible capital ratio requirement set for in the Final Order has not been satisfied at Dec. 31, 2010. Further, should the Company's asset quality continue to erode and require significant additional provision for credit losses, resulting in added future net operating losses at the Bank, or should the Company otherwise fail to be profitable, the Company's capital levels will additionally decline requiring the raising of more capital than the amount currently required to satisfy the Company' agreements with its regulators. The Company said an inability to raise additional capital when needed or comply with the terms of the Final Order or the Written Agreement with the Board of Governors of the Federal Reserve System, raises substantial doubt about its ability to continue as a going concern. The Company's independent registered public accounting firm in their audit report for fiscal year 2010 has expressed substantial doubt about the Company's ability to continue as a going concern. Continued operations may depend on the Company's ability to comply with the regulatory orders the Company is subject to. HAYDEL PROPERTIES: Sec. 341 Creditors' Meeting Set for Feb. 17 -------------------------------------------------------------- The United States Trustee in Jackson, Mississippi, will hold a Meeting of Creditors pursuant to 11 U.S.C. Sec. 341(a) in the bankruptcy case of Haydel Properties LP on Feb. 17, 2012, at 10:30 a.m. at 341 Mtg - Gpt - Ch 7, 11, 13. Proofs of claim are due by May 10, 2012. Government Proof of Claim are due by July 9, 2012. Haydel Properties LP, in Biloxi, Mississippi, filed for Chapter 11 bankruptcy (Bankr. S.D. Miss. Case No. 12-50048) on Jan. 11, 2012. Judge Katharine M. Samson presides over the case. Patrick A. Sheehan, Esq., at Sheehan & Johnson, PLLC; and Robert Gambrell, Esq., at Gambrell & Associates, PLLC, serve 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 Michael D. Haydel, manager of general partner. HERCULES OFFSHORE: Bank Debt Trades at 2% Off in Secondary Market ----------------------------------------------------------------- Participations in a syndicated loan under which Hercules Offshore Inc. is a borrower traded in the secondary market at 98.40 cents- on-the-dollar during the week ended Friday, Jan. 20, 2012, an increase of 0.29 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 650 basis points above LIBOR to borrow under the facility. The bank loan matures on July 11, 2013, and carries Moody's Caa1 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Hercules Offshore Hercules Offshore Inc. (NASDAQ: HERO) -- http://www.herculesoffshore.com/-- provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the United States, Gulf of Mexico and internationally. The Company provides these services to integrated energy companies, independent oil and natural gas operators and national oil companies. The Company operates in six business segments: Domestic Offshore, International Offshore, Inland, Domestic Liftboats, International Liftboats and Delta Towing. Hercules Offshore, Inc., filed with the U.S. Securities and Exchange Commission its Quarterly Report on Form 10-Q reporting a net loss of $16.99 million on $162.99 million of revenue for the three months ended Sept. 30, 2011, compared with a net loss of $15.06 million on $157.61 million of revenue for the same period during the prior year. The Company also reported a net loss of $54.64 million on $492.57 million of revenue for the nine months ended Sept. 30, 2011, compared with a net loss of $50 million on $460.06 million of revenue for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $2.05 billion in total assets, $1.12 billion in total liabilities and $928.65 million in total stockholders' equity. * * * The Company reported a net loss of $134.59 million on $657.48 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $91.73 million on $742.85 million of revenue during the prior year. Hercules reported a net loss of $37.65 million on $329.58 million of revenue for the six months ended June 30, 2011, compared with a net loss of $34.94 million on $302.45 million of revenue for the same period during the prior year. The Company's balance sheet at June 30, 2011, showed $2.09 billion in total assets, $1.14 billion in total liabilities, and $944.48 million in stockholders' equity. HERTZ CORP: Fitch Affirms 'BB-' Long-Term Issuer Default Rating --------------------------------------------------------------- Fitch Ratings has affirmed the long-term Issuer Default Rating (IDR) of The Hertz Corporation (HRZ) at 'BB-'. Concurrently, HRZ's secured and unsecured debt ratings have been affirmed. In addition, Fitch removes the ratings from Negative Rating Watch and assigned a Stable Rating Outlook. Approximately $4.5 billion of secured and unsecured debt is affected by these actions. The affirmation reflects HRZ's strength as the leader in the on- airport rental market, its cost-containment initiatives, improved access to the capital markets, and solid capitalization and liquidity relative to some of its industry peers. Rating constraints continue to reflect the cyclicality of the car and equipment rental industry and the company's heavy reliance on secured funding, although unsecured debt financing has increased recently. Fitch initially placed the ratings on Negative Rating Watch in May 2011 following HRZ's revised bid to acquire Dollar Thrifty Automotive Group (DTG). HRZ formally withdrew its bid to acquire DTG on Oct. 27, 2011, following the company's rejection of outstanding offers and the announcement of its intention to operate as a stand-alone company. Hertz remains interested in acquiring DTG as it believes the combination would be a good strategic fit, and remains engaged with the regulators to secure antitrust clearance. Fitch has factored into its affirmation a potential acquisition based upon HRZ's last proposed exchange offer at or around $72 per share for DTG. The Stable Outlook reflects HRZ's improved credit metrics on a standalone basis, even after the company's recent acquisition of Donlen Corporation for $177 million in cash and the assumption of $770 million of vehicle-backed debt. However, the positive momentum is mitigated over the near term by a potential DTG acquisition, which Fitch believes could result in negative rating pressure if HRZ were to increase leverage over and above assumed levels in acquiring DTG, requiring a substantial cash outlay and additional debt to finance the transaction. Positive rating actions will be driven by the ability of the company to sustain improvements in operating performance, funding flexibility, and capitalization. Fitch would view favorably the company's ability to continue to manage its leverage profile over time. Should Hertz acquire DTG, the timing of any positive rating action would likely be pushed out over the medium-to-long term. Negative rating actions would be driven by deterioration in global economic conditions that would result in a decline in passenger travel volumes, which would hurt revenue and EBITDA generation. In addition, Fitch would also view negatively an acquisition of DTG under conditions that would adversely affect its current credit profile. Leverage, measured by HRZ's corporate debt to corporate EBITDA, improved to 3.43 times (x) at Sept. 30, 2011, on a trailing 12- month (TTM) basis, compared to 4.94x at year-end 2010 and 4.41x at year-end 2009. Net of unrestricted cash of $385 million, leverage was 3.14x compared to 2.79x at 2010 and 3.40x at 2009. Net corporate leverage improved in 2010 due to balance sheet cash on hand of $2.4 billion. On a TTM basis, Corporate EBITDA also improved in September 2011 to $1.3 billion from $1.1 billion in 2010. This is attributable to increased rental volumes, offset by a competitive pricing environment, as well as improved residual value on vehicle sales and disciplined cost controls. Fitch expects these trends to continue in the near term. HRZ's liquidity profile has improved over the last year with a more favorable debt maturity profile, lower cost of funds, and sufficient excess capacity on its corporate revolver as a result of its recent debt refinancing efforts. As of Sept. 30, 2011, HRZ has $1.2 billion of corporate liquidity including $386 million of unrestricted cash and $786 million of availability under its corporate revolver. The corporate revolver is not expected to expire until March 2016. Other than $176.1 and $473 million of unsecured debt coming due in 2012 and 2014, respectively, there is no other corporate debt scheduled to expire until October 2018. These figures exclude a $474.7 million convertible senior note for Hertz Global Holdings due in 2014. Fitch believes HRZ's current funding profile is sufficient to meet its peak fleet needs. The company reported record revenue of $6.3 billion for the nine- months ended Sept. 30, 2011, representing a 9.7% increase over the same period last year. Management expects revenue growth of 7% to 8% for 2012. Operating performance has improved since the downturn in the rental car market in 2009 due largely to cost containment, as operating efficiencies have grown, fleet costs have declined and a strong used vehicle market has yielded larger gains on sales. The Hertz Corporation, a subsidiary of Hertz Global Holdings, Inc., is the world's largest airport general-use car rental brand, operating from approximately 8,500 locations in approximately 150 countries worldwide. Hertz also operates one of the world's largest equipment rental businesses, Hertz Equipment Rental Corporation, through approximately 315 branches in the United States, Canada, China, France, Spain, Italy and Saudi Arabia, as well as through its international licensees. As of Sept. 30, 2011, the company operated a rental fleet of 325,500 vehicles in the U.S. and 159,100 internationally, excluding the 129,000 vehicles relating to Donlen. The company generated approximately $5.4 billion of rental car revenue in the nine-months ended Sept. 30, 2011. The company's stock trades on the NYSE under the ticker HTZ. Fitch has affirmed the following ratings, removed them from Rating Watch Negative, and assigned a Stable Outlook: The Hertz Corporation -- Long-term IDR at 'BB-'; -- Senior secured revolving facility at 'BBB-'; -- Secured term facility at 'BBB-'; -- Letter of credit facility at 'BBB-'; -- Senior unsecured debt 'BB-'. HILEX POLY: S&P Affirms 'B' Corporate Credit Rating --------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Hartsville, S.C.-based Hilex Poly Co. LLC (Hilex) to stable from negative and affirmed its 'B' corporate credit rating on the company. "At the same time, we raised our issue-level rating Hilex's $135 million term loan to 'B+' from 'B' and revised the recovery rating to '2' from '3', indicating our expectation for a substantial (70% to 90%) recovery in the event of a payment default," S&P said. "The outlook revision reflects Hilex's strengthened liquidity position resulting from improving operating performance and our expectation that the company will maintain adequate liquidity levels over the next 12 to 24 months," said Standard & Poor's credit analyst. "We expect Hilex will also maintain sufficient headroom under its fixed-charge and debt leverage covenants despite step-down provisions over the next two years. The outlook also reflects our view that earnings in 2012 will remain at least in line with 2011's improved levels." "The ratings on Hilex reflect our assessment of its business risk profile as 'vulnerable' and financial risk profile as 'aggressive' (as our criteria define the terms). The ratings also incorporate our expectation for minimal discretionary cash flow after significant debt amortization requirements," S&P said. Business risks include Hilex's narrow product mix, heavy customer concentration, and the threat of imports and legislative actions banning the use of plastic bags in certain states. Shifting consumer preference toward paper and reusable bags is also a rising risk. Partly offsetting these risks are the company's favorable market share and competitive advantages, including its relatively large scale of operations, in?house recycling capabilities, effective raw material pass-through provisions, and an improved cost position arising from restructuring actions it has undertaken in the past few years. "We regard the company's business profile as vulnerable. Value- addition is relatively limited, contributing to EBITDA margins of around 10%. The high degree of customer concentration is another risk factor, with the largest customer, Wal-Mart, accounting for more than 25% of sales, and the top 10 customers representing about 60% of sales. Environmental and regulatory considerations could significantly affect the plastic bag industry, and the bags have increasingly become a focus of environmental concern. Growing environmental consciousness and a shift in consumer preference toward reusable bags and paper bags could result in declining demand for plastic bags in the U.S. Ongoing legislative actions could further accelerate this trend and may develop into a longer-range credit concern, although Hilex successfully markets its products' environmental merits, including its greater recycled content," S&P said. Business strengths include a leading market share, scale advantages relative to domestic competition in raw material procurement, and the ability to meet requirements of large national-level retail customers. Hilex benefits from monthly contractual pass-throughs of resin price fluctuations for about 75% of its sales (quarterly for most of the rest). Hilex currently has around 25% recycled content in its plastic bags, and its goal is to increase that to 40% by 2015 as it continues to develop sourcing relationships to gain postindustrial and consumer waste for use in its products. It's the only domestic manufacturer that operates both a compounding facility and a plastic bag recycling facility, which provides a captive source of lower-cost recycled raw materials (it gets the balance of its virgin resin requirements at market prices). "The financial profile is aggressive. The key ratio of funds from operations (FFO) to total debt (adjusted for capitalized operating leases) was 20% as of Sept. 30, 2011 -- in line with our expectations of 15% to 20% at the current rating. The company expects acquisitions to be a part of its growth strategy, and we expect it to fund growth spending in a manner that preserves an financial profile commensurate with the ratings. There are a number of smaller players in the plastic bags and films market and Hilex could play a consolidator role," S&P said. "We could lower the ratings if escalating raw material prices caused availability under the revolving credit facility to decline significantly and if the EBITDA cushions under covenants deteriorate to single-digit percentage levels. We could also lower the ratings if debt increases beyond current levels, discretionary cash flow turns negative for an extended period, or if FFO to total debt is consistently below 12%. We view financial policy as a major risk factor, particularly in light of the company's 2010 debt-financed dividend recapitalization and its acquisition-driven growth strategy," S&P said. "Based on our downside scenario forecasts, we could lower the ratings if shifts in consumer preferences, legislation banning plastic bags in large markets, or the loss of a key customer caused volume declines of 20% or more. If this were to happen, along with a 300 basis point decrease in EBITDA, we would expect FFO to total adjusted debt to fall to below 12%," S&P related. "Although not likely at this time given the risks inherent in the company's vulnerable business profile," Mr. Krauss continued, "we could raise the ratings if its liquidity and cash flow generation gradually strengthen, and Hilex maintains a comfortable cushion under its covenants. We would also need to gain greater clarity on future financial policy decisions related to growth and shareholder rewards." HOVENSA LLC: Fitch to Finish Review on Bond Ratings in February --------------------------------------------------------------- Fitch Ratings believes that the announcement by Hovensa LLC (rated 'BB-' with a Stable Outlook) that it will cease refinery operations on the island of St. Croix will have a detrimental impact on the economy and financial operations of the United States Virgin Islands (USVI; implied general obligation [GO] bond rating of 'BB+' with a Stable Outlook). Fitch expects to complete a review of the associated bond ratings of the USVI some time in February, following expected action to address a current fiscal year (FY) budget gap and receipt of additional information on the Hovensa closure. According to Hovensa, the refinery employs about 1,200 people and has approximately 960 contractors on St. Croix. The firm states that it now intends to operate the facility as an oil storage terminal and will employ about 100 people, including contractors. In addition to being the USVI's largest employer, Hovensa's activities have been a large source of tax revenues to the USVI. The governor of the USVI has estimated the revenue impact to the government to be about $60 million annually on a General Fund budget of approximately $700 million. Further, as the largest supplier of on-island refined oil, Fitch believes there is a potential for increases in energy and fuel costs in the USVI which could also have negative economic impacts. The closure could threaten not only the 'BB+' implied GO rating on the USVI but also the 'BBB' rating on the Virgin Island Public Finance Authority (VIPFA) bonds secured by gross receipts taxes, should pledged revenues be reduced by a significant downturn in the USVI's economy. Bonds issued by VIPFA that are secured by federal excise taxes based on sales in the U.S. of USVI rum are more insulated from economic and financial pressures of the USVI. Payment on those bonds (senior indenture rated 'BBB+' on the senior lien and 'BBB' on the junior lien, and Diageo and Cruzan indentures each rated 'BBB', all with Stable Outlooks) is ultimately dependent on continuation of rum production at both facilities. Fitch is concerned that a wide ranging impact on the USVI from the closure could compound an already unbalanced General Fund financial position and delay prospects for fiscal stabilization. For FY 2012, the USVI has projected a budget gap of about $67 million (prior to Hovensa's announcement); FY 2011 is reported to have ended with a $26.5 million budget deficit. The USVI is undertaking multiple rounds of budget negotiations to eliminate the current year's gap, with almost 500 employees eliminated to date. An additional 500 employee terminations are possible by the end of January along with various fee and tax increases. GOOD SAM: Offers to Purchase $7.4 Million 11.50% Senior Notes ------------------------------------------------------------- Good Sam Enterprises, LLC, commenced an offer to purchase up to $7,425,000 in principal amount of the Company's outstanding 11.50% Senior Secured Notes due 2016. The Offer to Purchase will expire at 5:00 p.m., New York City time, on Feb. 17, 2012, unless extended. The Offer to Purchase is being made pursuant to the terms of the indenture governing the Notes. The Offer Amount is $7.5 million. The purchase price is 101% of the principal amount of the Notes, plus accrued and unpaid interest to the date of purchase. Since the Offer Amount is $7.5 million and the purchase price is 101%, the maximum aggregate amount of Notes that could be purchased pursuant to this Excess Cash Flow Offer is $7,425,000. If the aggregate principal amount of Notes validly tendered in the Offer to Purchase exceeds the Offer Amount, Notes will be accepted for purchase on a pro rata basis, such that the aggregate purchase price for the Notes purchased does not exceed the Offer Amount. About Affinity Group Ventura, Calif.-based Affinity Group Holding, Inc., now known as Good Sam Enterprises, LLC, is a holding company and the direct parent of Affinity Group, Inc. The Company is an indirect wholly- owned subsidiary of AGI Holding Corp, a privately-owned corporation. The Company is a member-based direct marketing organization targeting North American recreational vehicle owners and outdoor enthusiasts. The Company operates through three principal lines of business, consisting of (i) club memberships and related products and services, (ii) subscription magazines and other publications including directories, and (iii) specialty merchandise sold primarily through its 78 Camping World retail stores, mail order catalogs and the Internet. The Company also reported net income of $4.57 million on $362.26 million of revenue for the nine months ended Sept. 30, 2011, compared with a net loss of $6.24 million on $361.65 million of revenue for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $233.96 million in total assets, $487.09 million in total liabilities and a $253.12 million total stockholder's or member's deficit. * * * Affinity Group Inc. carries 'B3' long term corporate family and probability of default ratings, with 'stable' outlook, from Moody's Investors Service. As reported in the Troubled Company Reporter on November 9, 2010, Standard & Poor's Ratings Services assigned Affinity Group Inc.'s proposed $325 million senior secured notes due 2016 its preliminary 'B-' issue-level rating. Following the close of the proposed transaction, S&P expects to assign a 'B-' corporate credit rating to Affinity Group Inc., and withdraw S&P's current 'D' corporate credit rating on Affinity Group Holding Inc. A portion of the proceeds of the new notes will be used, in conjunction with cash contributions from Holding's parent, to repay in full $88 million of senior notes that are currently outstanding at Holding. S&P said the expected 'B-'corporate credit rating on Affinity Group reflects S&P's expectation that, following the proposed refinancing transaction, adjusted debt leverage will be reduced by about 1x, the company will not have any meaningful near-term debt maturities, and the company will generate some discretionary cash flow (albeit minimal). Still, credit measures will remain relatively weak, as adjusted debt leverage will remain above 6.0x (S&P's operating lease adjustment adds about a turn to leverage), and S&P expects interest coverage to remain in the low- to mid- 1.0x area over the intermediate term. HOVENSA LLC: Moody's Affirms 'Ba2' Corporate Family Rating ---------------------------------------------------------- Moody's Investors Service affirmed HOVENSA LLC's Ba2 corporate family rating and the Ba2 rating on its tax-exempt bonds in response to the joint venture's announcement that it will shut down its 350,000 barrel-per-day refinery in St. Croix, the Virgin Islands, by mid-February 2012. The site will continue to operate as an oil products terminal. RATINGS RATIONALE "HOVENSA's refinery is one of the largest in the Atlantic Basin and Western Hemisphere, running a large supply of lower cost heavy crude from Venezuela. Still, high market inventory levels, narrow light/heavy crude differentials, and high fuel costs at the refinery forced the owners to make this shutdown decision," said Tom Coleman, Senior Vice President. "While shuttering and severance costs will be an upfront burden, the owners ultimately will cut losses and benefit from stronger liquidity and improved returns." The ratings affirmation reflects HOVENSA's intent to tender for its entire $356 million of outstanding industrial revenue bonds, which will be funded by cash and inventory liquidation. Under deteriorating market conditions the owners, Hess Corporation (rated Baa2 senior unsecured) and Petr�leos de Venezuela (PDVSA, B1 global local currency issuer rating) have been supporting HOVENSA via tight working capital management. Additionally, HOVENSA repaid and terminated its $400 million revolving credit facility as of December 30, 2011. Moody's believes a strong crude and product price outlook will support HOVENSA's inventory values and ability to make timely payoff of all principal and accrued interest on the bonds via the tender process, which is expected to expire approximately 20 days after formal notice to bondholders. Assuming most of the holders tender the bonds, Moody's expects to withdraw the ratings upon expiration of the tender. At the same time, Moody's does not expect the shutdown to affect Hess Corporation's Baa2 long-term debt rating and stable outlook or PDVSA's B1 global local currency issuer rating. Hess announced it will book a $525 million after-tax charge related to severance and shuttering costs. The charge is expected to cover its pro-rata share of any residual cash costs incurred in the shuttering process, which should be largely completed and paid out in 2012. The leverage and liquidity impacts on Hess will be fairly small given an outlook for strong crude prices, its crude-weighted upstream production profile, and its solid liquidity position, which included $827 million in cash as of September 30, 2011, and a $4 billion revolving credit facility, substantially all of which was unutilized. In addition, Hess should be able to replace HOVENSA product supplies for its retail marketing system using plentiful market supplies in the Atlantic Basin. PDVSA, like Hess, has continued to support HOVENSA's crude supply needs and working capital and liquidity. While PDVSA benefited from HOVENSA as a secure outlet for significant volumes of its Mesa and Merey crudes, the loss of this outlet and residual cash costs of the shutdown will not materially affect the Venezuelan state oil company's financial and operating position. The principal methodology used in rating HOVENSA was the Global Refining and Marketing 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. HUSSEY COPPER: Court Sets Feb. 29 as General Claims Bar Date ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware has established Feb. 29, 2012, at 4:00 p.m. (prevailing Eastern Time), as the deadline for any individual or entity to file proofs of claim against Hussey Copper Corp. et al. The Bankruptcy Court also established March 26, at 4:00 p.m. as the bar date for all Governmental Units to file proofs of claim. Proof of claim forms must be sent to the claims agent at the these addresses: If sent by mail: Donlin Recano & Company, Inc. Re: Hussey Copper Corp., et al. P.O. Box 2048 Murray Hill Station New York, NY 10156 If sent by hand delivery or overnight courier: Donlin Recano & Company, Inc. Re: Hussey Copper Corp., et al. 419 Park Avenue South, Suite 1206 New York, NY 10016 About Hussey Copper Hussey Copper Corp., based in Leetsdale, Pennsylvania, is one of the leading manufacturers of copper products in the United States. Hussey Copper was founded in Pittsburgh in 1848. The Company and its affiliates, which operate one manufacturing facility in Leetsdale and two facilities in Eminence, Kentucky, manufacture "a wide range of value-added copper products and copper-nickel products. The Company has more than 500 full-time employees. Hussey Copper Corp. filed a Chapter 11 petition (Bankr D. Del. Case No. 11-13010) on Sept. 27, 2011, with a deal to sell substantially all assets. Five other affiliates also filed separate petitions (Case Nos. 11-13012 to 11-13016). Hussey Copper Ltd. estimated $100 million to $500 million in assets and debts. Hussey Copper Corp. estimated up to $50,000 in assets and up to $100 million in debts. Mark Minuti, Esq., at Saul Ewing LLP, serves as counsel to the Debtors. Donlin Recano & Company Inc. is the claims and notice agent. An official creditors' committee has been appointed in the case. The panel selected Lowenstein Sandler PC as counsel. The panel selected FTI Consulting, Inc. as restructuring and financial advisor. The stalking horse bidder, KHC Acquisitions LLC, a unit of Kataman Metals LLC, is represented in the case by David D. Watson, Esq., and Scott Opincar, Esq., at McDonald Hopkins LLC, in Cleveland. Counsel to PNC Bank NA, as lender, issuer and agent for the Debtors' secured lenders, are Lawrence F. Flick II, Esq., Blank Rome LLP, in New York, and, Regina Stango Kelbon, Esq., at Blank Rome LLP, in Wilmington. INDIANA HEALTH: Fitch Raises Rating on Two Bonds From 'BB+' ----------------------------------------------------------- Fitch Ratings has upgraded to 'BBB-' from 'BB+' the following Indiana Health Facilities Financing Authority bonds, issued on behalf of The Methodist Hospitals (TMH): -- $12.6 million revenue bonds, series 1996; -- $56.7 million revenue bonds, series 2001. The Rating Outlook is revised to Stable from Positive. TMH's upgrade to 'BBB-' from 'BB+' is supported by sustained improvements in operating profitability. Following significant losses in fiscal 2008 when there was a mass exodus of active physicians, TMH has consistently improved its performance to a 1.9% operating margin and 10.9% operating EBITDA margin in 2010, against Fitch's 'BBB' medians of 1.7% and 8.5%, respectively. Operating performance was very strong through the nine months ended Sept. 30, 2011 with a 4.2% operating margin; however, this is inflated by a $33 million DSH payment. Operating improvements have been driven by reducing costs, improving revenue cycle management, and rebuilding the medical staff. Improvements in operations have generated good debt service coverage. Fitch has calculated maximum annual debt service (MADS) at $11.3 million, which includes approximately $3 million in annual capital lease payments. TMH covered MADS at 3.1 times (x) by EBITDA and 2.7x by operating EBITDA for fiscal 2010 and 3.5x and 3.2x, respectively for the interim period ending Sept. 30, 2011. This compares favorably to the medians for the rating category of 2.6x and 2.3x, respectively. TMH has no further debt plans, and management expects to fund approximately $25 million in ongoing annual capital expenditures with cash flow. Fitch notes that total revenue has declined every year since 2007, which can be attributed to a drop in patient volumes, strategic service line consolidation, and the timing of DSH moneys. However, TMH's significant expense reduction efforts have thus far preserved profitability. Fitch believes revenue growth will need to return to ensure long-term viability. Fitch's primary credit concern is TMH's unfavorable payor mix and reliance on DSH revenues. The Indiana DSH program is expected to remain in place until its phasing-out begins in 2014, and TMH is pursuing longer-term eligibility for its Northlake campus. Still, the future of these payments is uncertain, and presents a fundamental risk to the stability of TMH's revenue base going forward. The Outlook revision to Stable is based on Fitch's expectation that TMH will continue generating operating cash flow levels which are consistent with Fitch's 'BBB' median ratios over the next 12- 24 months. Fitch also expects TMH to preserve its healthy balance sheet metrics. TMH operates a 302-bed acute care facility in Gary (Northlake campus), Indiana and a 313-bed acute care facility in Merrillville, Indiana (Southlake campus). The obligated group is comprised of Methodist Hospitals Inc. Total revenues for 2010 were $289.9 million. TMH covenants to disclose audited financial statements within 150 days of fiscal year end. Annual disclosure is posted to the Municipal Securities Rulemaking Board's EMMA system. While TMH does not covenant to disclose quarterly statements, it does so voluntarily to bondholders via EMMA. Quarterly disclosure includes balance sheet, income statement, statement of cash flows, utilization, and management discussion and analysis. Fitch notes that management has been very accessible, timely and thorough in its disclosure. INGALLS INDUSTRIES: Fitch Affirms 'BB' Issuer Default Rating ------------------------------------------------------------ Fitch Ratings has affirmed Huntington Ingalls Industries, Inc.'s (HII) Issuer Default Rating (IDR) and senior unsecured debt ratings at 'BB'. Fitch has also affirmed HII's senior secured facilities at 'BBB-'. The Rating Outlook is Stable. The ratings cover approximately $1.9 billion of outstanding debt. HII's ratings are supported by a solid liquidity position, positive free cash flow (FCF; cash from operations less capital expenditures and dividends), the high level of current Department of Defense (DoD) spending, and HII's position in the current DoD spending environment with roles on four of the DoD's top 11 programs in the fiscal 2012 budget. Fitch also considered HII's role as a sole source manufacturer on about 66% of its revenues, its large and highly visible backlog, and the company's pension position (92% funded at the end of 2010). Fitch's rating concerns include risks to core defense spending after fiscal 2012, HII's revenue concentration with the U.S. Navy and Coast Guard, the ongoing restructuring at the company's Ingalls operations, and HII's undefined cash deployment strategy. HII generates nearly all of its revenues from the U.S. government, exposing the company to changes in U.S. Navy and U.S. Coast Guard plans regarding future fleet needs. In addition, Fitch is concerned by the company's relatively low though improving margins, program execution risks and the high percentage of the workforce that is unionized. The notching up of the senior secured credit facility by two rating notches from the IDR of 'BB' to 'BBB-' is supported by the coverage provided by HII's tangible assets and operating EBITDA compared to the fully drawn facility. The collateral for the facility includes substantially all of HII's assets with the exception of the Avondale shipyard and a few other exclusions. Fitch may consider a positive rating action if HII decreases its current leverage by either reducing its debt or increasing its EBITDA driven by an execution of ongoing margin improvement initiatives. Potential positive rating actions will also be dependant on clarity of HII's future cash deployment strategy. A negative rating action may be considered should the company's leverage (debt to EBITDA) increase to above approximately 3.6-3.8 times (x), or if defense spending cuts have a more significant impact on the company's earnings and FCF than currently anticipated. HII's leverage was approximately 3.2x for the last 12 months ended at Sept. 30, 2011. HII's current leverage is in line with Fitch's initial expectation that it would be approximately 3.2-3.4x after the spin-off from Northrop Grumman. There is the potential for steady improvement over the next several years with some debt reduction and restructuring-driven margin expansion. HII has a good liquidity position of approximately $1.1 billion, consisting of $536 million in cash and $529 million in availability under its $650 million domestic credit revolving facility, after giving effect to $121 million of outstanding letters of credit. Fitch expects HII's liquidity to remain strong, however it will likely be lower once the company determines its cash deployment strategy. HII generated approximately $262 million cash flow from operating activities during the last 12 months ended (LTM) Sept. 30, 2011, down from $359 million at the end of 2010. Lower cash flow was primarily due to changes in working capital and higher interest expenses. Correspondingly, HII's FCF totaled $48 million during the LTM ended Sept. 30, 2011, down from $168 million at the end of 2010. Fitch expects HII's cash generation to be in line with the results of 2010 and LTM ended at Sept. 30, 2011. Fitch also expects FCF margin to gradually improve beyond 2012. HII does not have a set policy regarding its cash deployment at this moment, however Fitch expects that HII's dividend and share repurchase (if any) policies will be established by the board of directors based on HII's financial conditions and other factors. HII's pension plans were underfunded by $259 million (92% funded) with other post employment benefits (OPEB) obligations totaling $713 million at the end of 2010. HII expects that required contributions for 2011 will total $2 million for the company's defined benefit plans and $37 million for its OPEB plans. Through the first nine months of 2011, HII had contributed $1 million and $28 million to its pension and OPEB plans, respectively. Fitch expects the funded status of HII's pension obligation to decline in 2011 due to prevailing low interest rate market environment and unfavorable performance of global equity markets. HII's status as a defense contractor mitigates some of the risks associated with its pension obligations. Most of HII's pension contributions are recoverable through government contracts because they qualify as allowable costs under government Cost Accounting Standards (CAS). Most of HII's revenues are derived from the defense industry. High levels of defense spending currently support HII's ratings, but the DoD budget environment is highly uncertain after fiscal 2012 because of large U.S. government budget deficits and the potential for large, automatic spending cuts beginning in fiscal 2013. The end of the 'Supercommittee' negotiations without an agreement increases the probability of Fitch's harshest DoD spending scenario ('sequestration'), but Fitch expects less severe and more orderly spending scenarios are possible because Congress could act to avoid or modify sequestration's automatic cuts beginning in January 2013. Fitch estimates that DoD spending reductions in the sequestration scenario would total nearly $1 trillion over 10 years. In Fitch's view, the most negative element of this scenario is an estimated 12%-13% decline in spending in fiscal 2013, which Fitch understands would be made across the board without consideration of program health or national security priorities. Fitch believes that modest declines in defense spending would not lead to negative rating actions given the strategic importance of HII's portfolio, long lead times for program execution and the amount of DOD funding HII received in both fiscal 2011 and fiscal 2012. The exposure to DoD spending is also mitigated by HII's good liquidity position. IOWA RENEWABLE: Posts $4.8 Million Net Loss in Fiscal 2011 ---------------------------------------------------------- Iowa Renewable Energy, LLC, filed on Jan. 19, 2011, its annual report for the fiscal year ended Sept. 30, 2011. McGladrey & Pullen, LLP, in Davenport, Iowa, expressed substantial doubt about Iowa Renewable Energy's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations, has incurred significant debt and has experienced significant liquidity issues. The Company reported a net loss of $4.8 million on $32.7 million of revenues for fiscal 2011, compared with a net loss of $4.4 million on $9.2 million of revenues for fiscal 2010. The Company's balance sheet at Sept. 30, 2011, showed $41.9 million in total assets, $38.8 million in total liabilities, and members' equity of $3.1 million. A copy of the Form 10-K is available for free at: http://is.gd/uBY3zG Iowa Renewable Energy, LLC, located in Washington, Iowa, was formed in April 2005 to pool investors to build a biodiesel manufacturing plant with an annual capacity of between 25 and 30 million gallons, depending on the feedstock used. The Company was in the development stage until July 2007, when it commenced operations. JEFFERSON COUNTY: Bondholders, Receiver Appeal on Sewers' Control ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Jan. 6 ruling by the bankruptcy judge taking away the state-court appointed receiver's control of the Jefferson County, Alabama, sewer system was appealed on Jan. 20 by the receiver and other parties on the losing side of the case. Others appealing were Bank of New York Mellon Corp., as indenture trustee for the bondholders, and JPMorgan Chase Bank NA, the holder of $1 billion of the sewer bonds. Mr. Rochelle notes that before deciding whether Jefferson County is eligible for Chapter 9, the judge will allow the Alabama Supreme Court to decide whether sewer warrants are the equivalent of "funding or refunding bonds" required under state law before a municipality can be in bankruptcy. The county began the country's largest municipal bankruptcy on Nov. 9. The county said that long-term debt is $4.23 billion, including about $3.1 billion in defaulted sewer debt where the debt holders can look only to the sewer system for payment. About Jefferson County Jefferson County has its seat in Birmingham, Alabama. It has a population of 660,000. Jefferson County filed a bankruptcy petition under Chapter 9 (Bankr. N.D. Ala. Case No. 11-05736) on Nov. 9, 2011, after an agreement among elected officials and investors to refinance $3.1 billion in sewer bonds fell apart. John S. Young Jr. LLC was appointed as receiver by Alabama Circuit Court Judge Albert Johnson in September 2010. Jefferson County's bankruptcy represents the largest municipal debt adjustment of all time. The county said that long-term debt is $4.23 billion, including about $3.1 billion in defaulted sewer bonds where the debt holders can look only to the sewer system for payment. The county said it would use the bankruptcy court to put a value on the sewer system, in the process fixing the amount bondholders should be paid through Chapter 9. Judge Thomas B. Bennett presides over the Chapter 9 case. Lawyers at Bradley Arant Boult Cummings LLP and Klee, Tuchin, Bogdanoff & Stern LLP, led by Kenneth Klee, represent the Debtor as counsel. Kurtzman Carson Consultants LLC serves as claims and noticing agent. Jefferson estimated more than $1 billion in assets. The petition was signed by David Carrington, president. KLN STEEL: Committee Wants to Retain Hall Attorneys as Counsel -------------------------------------------------------------- The Official Committee of Unsecured Creditors of KLN Steel Products Company, LLC, et al., seeks permission from the U.S. Bankruptcy Court for the Western District of Texas to retain Hall Attorneys, P.C., as its general bankruptcy counsel. The Firm's rates for attorneys are $225 to $325 per hour and for non-attorneys $50 to $125 per-hour. The current hourly rate for Nicholas Hall and Ron Satija, the principal attorneys handling the Committee representation, is $325. To the best of the Committee's knowledge and based on the Hall Declaration, the Firm has no connection with the Debtors, their creditors, any other party-in-interest, their respective attorneys or professionals, the United States Trustee or any person employed in the Office of the United States Trustee. The Firm does not hold, or represent any entity having, an adverse interest in connection with the Debtors or their bankruptcy cases. The Firm can be contacted at: Nicholas A. Hall Bar Number: 24069863 Ron Satija Bar Number: 24039158 701 Brazos, Suite 500 Austin, TX 78701 Telephone 512-551-3041 Fax 512-692-2833 nhall@hallattorneys.com rsatija@hallattorneys.com About KLN Steel Products KLN Steel Products Company LLC, Dehler Manufacturing Co. Inc., and Furniture by Thurston manufacture and market high quality furniture for multi-person housing facilities and packaged services for federal government offices and dormitory facilities. They have two manufacturing facilities. One is in San Antonio, Texas, which is consolidated and designed to accommodate high volume fabrication of standard and semi-custom steel furniture and casegoods of high quality for colleges and universities, military quarters, and job corps centers, or wherever high quality, long life, low maintenance furniture is essential. The facility includes a manufacturing facility of more than 170,000 square feet capable of producing substantial projects on a timely basis. The second facility is located in Grass Valley, California, with more than 61,000 square feet dedicated to the manufacturing of wood furniture for military and university housing. KLN Steel filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-12855) on Nov. 22, 2011. Dehler (Case No. 11-12856) and Furniture by Thurston (Case No. 11-12858) filed on the same day. Judge Craig A. Gargotta oversees the case. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as the Debtors' counsel. Conway MacKenzie, Inc., serves as financial advisor. Each of the Debtors estimated assets and debts of $10 million to $50 million. San Antonio, Texas-based 4200 Pan Am LLC filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-13154) on Dec. 29, 2011. Judge Gargotta oversees the case, taking over from Judge H. Christopher Mott. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as 4200 Pan Am's counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and debts. The petition was signed by Edward J. Herman, manager. 4200 Pan Am is seeking joint administration of its case with those of affiliates Dehler, Furniture By Thurston, and KLN. KLN STEEL: Wants to Hire Horwood Marcus as Special Counsel ---------------------------------------------------------- KLN Steel Products Company, LLC, et al., seek permission from the U.S. Bankruptcy Court for the Western District of Texas to employ Horwood Marcus & Berk Chartered as their special counsel. It is proposed that Horwood Marcus would provide the Debtors with legal representation respecting general corporate matters, certain litigation matters to the extent necessary, conflict matters, and services as Registered Agent of the Debtors. Horwood Marcus was outside corporate counsel, litigation counsel and Registered Agent for and represented the Debtors prior to the filing of the Debtors' bankruptcy cases, and has been selected by the Debtors for the proposed post-petition engagement because of its expertise and familiarity with the Debtors' corporate and litigation matters. The rates of the attorneys in the Firm range from $215 an hour to $540 an hour. Horwood Marcus's paralegal rates range from $130 an hour to $150 an hour. The firm will seek reimbursement for necessary expenses. To the best of the Debtors' knowledge, Horwood Marcus does not hold any interest adverse to the Debtors or to the Debtors' bankruptcy estates. About KLN Steel Products KLN Steel Products Company LLC, Dehler Manufacturing Co. Inc., and Furniture by Thurston manufacture and market high quality furniture for multi-person housing facilities and packaged services for federal government offices and dormitory facilities. They have two manufacturing facilities. One is in San Antonio, Texas, which is consolidated and designed to accommodate high volume fabrication of standard and semi-custom steel furniture and casegoods of high quality for colleges and universities, military quarters, and job corps centers, or wherever high quality, long life, low maintenance furniture is essential. The facility includes a manufacturing facility of more than 170,000 square feet capable of producing substantial projects on a timely basis. The second facility is located in Grass Valley, California, with more than 61,000 square feet dedicated to the manufacturing of wood furniture for military and university housing. KLN Steel filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-12855) on Nov. 22, 2011. Dehler (Case No. 11-12856) and Furniture by Thurston (Case No. 11-12858) filed on the same day. Judge Craig A. Gargotta oversees the case. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as the Debtors' counsel. Conway MacKenzie, Inc., serves as financial advisor. Each of the Debtors estimated assets and debts of $10 million to $50 million. San Antonio, Texas-based 4200 Pan Am LLC filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-13154) on Dec. 29, 2011. Judge Gargotta oversees the case, taking over from Judge H. Christopher Mott. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as 4200 Pan Am's counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and debts. The petition was signed by Edward J. Herman, manager. 4200 Pan Am is seeking joint administration of its case with those of affiliates Dehler, Furniture By Thurston, and KLN. KLN STEEL: Court Approves Jackson Walker as Attorneys ----------------------------------------------------- KLN Steel Products Company, LLC, et al., sought and obtained permission from the U.S. Bankruptcy Court for the Western District of Texas to employ J. Scott Rose and Patricia B. Tomasco and the law firm of Jackson Walker L.L.P. as their attorneys. Jackson Walker received a retainer of $200,000 for services performed and to be performed in connection with and in contemplation of the filing of the bankruptcy case. Patricia B. Tomasco's hourly rate is currently $450. The rates of other attorneys in Jackson Walker range from $190 to $650 an hour and legal assistant rates are $165 an hour. To the best of Debtors' knowledge, these attorneys have no interest adverse to the Debtors or to the Debtors' bankruptcy estate and are disinterested. The firm can be reached at: Patricia Baron Tomasco, Esq. JACKSON WALKER LLP 100 Congress Avenue, Suite 1100 Austin, TX 78701 Tel: (512) 236-2076 Fax: (512) 691-4438 About KLN Steel Products KLN Steel Products Company LLC, Dehler Manufacturing Co. Inc., and Furniture by Thurston manufacture and market high quality furniture for multi-person housing facilities and packaged services for federal government offices and dormitory facilities. They have two manufacturing facilities. One is in San Antonio, Texas, which is consolidated and designed to accommodate high volume fabrication of standard and semi-custom steel furniture and casegoods of high quality for colleges and universities, military quarters, and job corps centers, or wherever high quality, long life, low maintenance furniture is essential. The facility includes a manufacturing facility of more than 170,000 square feet capable of producing substantial projects on a timely basis. The second facility is located in Grass Valley, California, with more than 61,000 square feet dedicated to the manufacturing of wood furniture for military and university housing. KLN Steel filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-12855) on Nov. 22, 2011. Dehler (Case No. 11-12856) and Furniture by Thurston (Case No. 11-12858) filed on the same day. Judge Craig A. Gargotta oversees the case. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as the Debtors' counsel. Conway MacKenzie, Inc., serves as financial advisor. Each of the Debtors estimated assets and debts of $10 million to $50 million. San Antonio, Texas-based 4200 Pan Am LLC filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-13154) on Dec. 29, 2011. Judge Gargotta oversees the case, taking over from Judge H. Christopher Mott. Patricia Baron Tomasco, Esq., at Jackson Walker LLP, serves as 4200 Pan Am's counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and debts. The petition was signed by Edward J. Herman, manager. 4200 Pan Am is seeking joint administration of its case with those of affiliates Dehler, Furniture By Thurston, and KLN. LEE ENTERPRISES: To Complete Chapter 11 Process Jan. 30 ------------------------------------------------------- Lee Enterprises, Incorporated has successfully completed the remaining steps to enable its refinancing agreements to go into effect on Jan. 30, 2012. The agreements extend the maturities of Lee's borrowings to December 2015 and April 2017. Implementation required a voluntary, prepackaged Chapter 11 process to bind a small minority of non-consenting lenders to the terms. The plan of reorganization was confirmed by Chief U.S. Bankruptcy Judge Kevin Gross in the District of Delaware, where Lee is incorporated. Lee is scheduled to emerge from Chapter 11 on Jan. 30, 2012, when the plan of reorganization becomes effective. "This is the favorable outcome we fully expected, and it provides Lee with a nearly four-year runway to continue improving our balance sheet," said Mary Junck, chairman and chief executive officer. "The completion of our Chapter 11 process, which began Dec. 12, 2011, did not affect employees, vendors, contractors, customers or any aspect of company operations. Stockholders retain their interest in the company with only modest dilution. The refinancing, along with our ongoing strong cash flow, will keep Lee on solid financial footing as we continue reshaping our company and building on our unique strengths. Because of our intensive sales culture and evolving array of products, Lee has outpaced the industry in advertising revenue performance for 33 quarters in a row. Even in a challenging economy, more than 80% percent of adults in our larger markets read or use our print and digital products each week, including two-thirds of 18- to 29- year-olds. All of this reinforces our optimism for the future." Lee announced in September that its credit facility would be amended and extended beyond its current maturity of April 2012 in a structure of first and second lien debt. The first lien debt consists of a term loan of $689.5 million, as well as a new $40 million revolving credit facility that is not expected to be drawn at closing, both of which mature in December 2015. The first lien debt carries interest at LIBOR plus 6.25%, with a LIBOR floor of 1.25%. Interest on the $40 million revolver is at LIBOR plus 5.5%, with a LIBOR floor of 1.25%. Mandatory amortization payments for the first lien debt total $5 million for the remainder of our 2012 fiscal year, $11 million in 2013, $12.75 million in 2014, and $13.5 million prior to the final maturity in 2015. The second lien debt consists of a $175 million term loan with an interest rate of 15% maturing in April 2017. There are no mandatory amortization payments required. Second lien creditors will share in issuance of approximately 6,744,000 shares of Lee Common Stock, amounting to approximately 13% of outstanding shares on a pro forma basis as of the closing date. Agreement on extending Lee's remaining debt, the Pulitzer Notes, was reached in December. The debt will carry an interest rate of 10.55%, increasing 0.75% in January 2013 and each year thereafter. Adjusted for principal payments and non-cash fees to be paid to noteholders, the amended Pulitzer Notes will have a balance of $126.4 million. Mandatory amortization payments total $1.4 million in 2012 and $6.4 million annually thereafter prior to the final maturity in December 2015. Both the first lien debt and Pulitzer Notes also require principal payments based on calculated excess cash flow and allow for optional repayments. Carl Schmidt, vice president, chief financial officer and treasurer, said that although the refinancing agreements ultimately received support from approximately 97% of lenders under the credit facility and all Pulitzer Notes lenders, Lee needed the court process to complete the transactions due to the requirement for unanimous approval of certain of the terms of the amended facilities. About Lee Enterprises Lee Enterprises, Inc., headquartered in Davenport, Iowa, publishes the St. Louis Post Dispatch and the Arizona Daily Star along with more than 40 other daily newspapers and about 300 weekly newspapers and specialty publications in 23 states. Revenue for the 12 months ended December 2010 was $780 million. The Company has 6,200 employees, with 4,650 working full-time. Lee Enterprises and certain of its affiliates filed for chapter 11 protection (Bankr. D. Del. Lead Case No. 11-13918) on Dec. 12, 2011, with a prepackaged plan of reorganization. The Debtor selected Young Conaway Stargatt & Taylor LLP as co-counsel; The Blackstone Group as Financial and Asset Management Consultant; and The Garden City Group Inc. as claims, noticing and balloting agent. The Debtor disclosed total assets of $1.15 billion and total liabilities of $1.25 billion at Sept. 25, 2011. The Plan has been proposed to, among other things, amend and extend the maturity of the Debtors' prepetition credit facilities and the so-called PD LLC Notes as part of an overall effort to restructure the Debtors' balance sheet. The Plan was proposed prepetition and obtained the support of 100% of holders of claims related to the Prepetition Credit Agreement, totaling roughly $827.9 million, and 100% of the holders of PD LLC Notes claims, totaling roughly $133.8 million. Priority Non-Tax Claims, Other Secured Claims, The Herald Claim, General Unsecured Claims, and Intercompany Claims against, as well as Interests in, all of the Debtors will not be impaired by the Plan. A hearing is set for Jan. 23 at 2:00 p.m. to consider confirmation of the prepack plan. Certain Holders of Prepetition Credit Agreement Claims, Goldman Sachs Lending Partners LLC, Mutual Quest Fund, Monarch Master Funding Ltd, Mudrick Distressed Opportunity Fund Global, LP and Blackwell Partners, LLC have committed to acquire up to a maximum amount of $166.25 million of loans under a New Second Lien Term Loan Facility. This commitment also includes the potential payment of up to $10 million as backstop cash to Reorganized Lee Enterprises to acquire the loans. Deutsche Bank Trust Company Americas, as DIP Agent and Prepetition Agent, is represented in the Debtors' cases by Sandeep "Sandy" Qusba, Esq., and Terry Sanders, Esq., at Simpson Thacher & Bartlett LLP. The Initial Backstop Lenders are represented by Matthew S. Barr, Esq., and Brian Kinney, Esq., at Milbank, Tweed, Hadley & McCloy LLP. LEHMAN BROTHERS: Seeks to Exercise First Offer Right in Archstone ----------------------------------------------------------------- Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York granted a motion by Lehman Brothers Holdings Inc. seeking to exercise its right of first offer to buy the stake of Bank of America Corp. and Barclays Plc in apartment owner, Archstone. Lehman filed the motion after the banks struck a deal to sell 26.5% of Archstone to Sam Zell's Equity Residential and granted the latter an option to buy the second half of their stake in the apartment owner for $1.33 billion. LBHI has the right of first offer to purchase the banks' stake pursuant to the terms of their agreement reached in December 2010. Lehman, which owns 47% of Archstone, had been hoping to buy the rest from the banks for $2.65 billion. Two weeks ago, LBHI's bid to block Equity Residential from buying part of Archstone was rejected after it failed to convince the bankruptcy court that it would face irreparable harm if the sale pushed through. Lehman, however, can match Equity Residential's offer, which would trigger an option allowing the latter to then buy the other half of the banks' stake. LBHI can match that offer also but would have to put up enough money to overcome a likely price increase. Lehman to Block Deal Lehman is planning this week to use $1.33 billion in cash to buy a 26.5% stake in Archstone, according to a January 23 report by The Wall Street Journal. The company, which has a right to match Equity Residential's offer, has to put up the cash this week if it wants to exercise that option. It is planning to do that as early as Monday using some of its extensive cash reserves, The Journal reported, citing people familiar with the matter as its source. However, a move by Lehman to exercise its option will not necessarily resolve the battle since under Equity Residential's deal with the banks, it also has a right to buy their other 26.5% stake. If it does, Lehman can and is prepared to match that offer although it is not clear what price Equity Residential would offer for the other 26.5% stake, the report said. Lehman is considering raising the money by bringing in an investor. It has been in talks with pension funds, including Canada's Caisse de depot et placement du Quebec and the Canadian Pension Plan Investment Board, people familiar with the discussions said. Archstone owns nearly 60,000 apartments in the U.S. and 14,000 in Germany. Lehman bought Archstone in 2007 in a $22 billion buyout through debt and equity financing from Bank of America and Barclays, which later became part owners when the buyout was restructured. Lehman's investment in Archstone is reportedly worth between $16 billion and $17 billion, including $11 billion in debt. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Seeks Estimation of LB Finance, et al., Claims --------------------------------------------------------------- Lehman Brothers Holdings Inc. has asked the U.S. Bankruptcy Court for the Southern District of New York to estimate the claims filed by Lehman Brothers Finance AG and seven other claimants. The move is part of Lehman's effort to expedite the distributions to creditors pursuant to its $65 billion payout plan, which the bankruptcy court confirmed last month. LB Finance filed $15.4 billion in claims against Lehman and another $552.8 million in claims against the company's special financing unit. The other claimants seek to recover as much as $37 billion from Lehman and Structured Assets Securities Corp. The claims are based on alleged breach of representations and warranties related to SASCO loans that were transferred to the trusts administered by the claimants. The trustees are U.S. Bank N.A., Citibank N.A., Wilmington Trust Co., Bank of America N.A., Deutsche Bank National Trust Co., HSBC Bank USA N.A. and Wells Fargo Bank N.A. Alfredo Perez, Esq., at Weil Gotshal & Manges LLP, in New York, said the request is "solely for the purpose of establishing reserves under the plan." He added that it is necessary so that Lehman would not have to maintain large reserves for those claims which could reduce distributions to creditors. Under the payout plan, Lehman is required to establish reserves for unresolved claims, including the claims of LB Finance and the trustees which the company described as "grossly overstated." In court papers, Lehman asked the bankruptcy court to estimate LB Finance's claim against the company at $0 in Class 4B, and to estimate its claim against the special financing unit at $63.5 million in Class 5C. As for the $37 billion in claims filed by the trustees, Lehman proposed that the claims be estimated as unsecured claims in the amounts listed at: http://bankrupt.com/misc/LBHI_TrusteesClaimEstimates.pdf Daniel Ehrmann, managing director of Alvarez & Marsal North America LLC, said in a declaration that he found no evidence that Lehman's books and records were "materially deficient or unreliable," and that they "fairly reflect the obligations owed" by LB Finance to the company. Meanwhile, Zachary Trumpp, a LAMCO LLC employee who participated in the development of the methodology used to estimate the trustees' claims, said the methodology "represents a reasonable and fair basis" to estimate the potential liability of Lehman and SASCO to the trustees. Judge James Peck will hold a hearing to consider the request on January 26, 2012. PwC Opposes Claim Estimation PricewaterhouseCoopers AG, Zurich, the firm appointed to liquidate LB Finance, criticized the proposed estimation of LB Finance's claims, saying Lehman failed to prove that the liquidation of the claims would delay the administration of its bankruptcy case. PwC blamed Lehman for any delay in resolving their dispute, pointing out that the company even refused to engage in mediation with the firm. The firm further said that Lehman made the request under a provision of the U.S. Bankruptcy Code, which only authorizes the estimation of "contingent or unliquidated claims" although LB Finance's claims are neither contingent nor unliquidated. Lehman also drew criticisms from Wells Fargo, Wilmington Trust, Citibank, U.S. Bank and Deutsche Bank. The trustees complained that Lehman did not provide factual basis for its estimates, the company failed to prove that the estimation is necessary to avoid delaying the bankruptcy cases, among other reasons. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wins Nod to Sell Stake in Wilpon for $390MM ------------------------------------------------------------ Lehman Brothers Holdings Inc. obtained court approval to sell their stake in Wilton Re Holdings Limited to the Bermuda-based company for more than $390.2 million. LBHI, which invested as much as $300 million in Wilton, owns about 5.66 million shares representing about 25% of the reinsurance holding company's outstanding shares. Wilton is buying Lehman's stake for $69 a share, a price that Lehman described as above market, Bloomberg News noted. The sale is subject to closing conditions including approval or authorization from the bankruptcy court and certain government agencies. Wilton must also be satisfied with the feedback from rating agencies concerning the closing of the sale. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wins OK to Stay Suits Seeking $3-Billion --------------------------------------------------------- Judge James Peck issued an order granting another six-month stay on more than 50 lawsuits filed by Lehman Brothers Holdings Inc. to recover more than $3 billion. The order extends the stay to July 20, 2012, and the deadline for completing service of summons and complaints on the defendants to March 30, 2012. It also imposes a September 5, 2012 deadline for the defendants to answer the complaints. The bankruptcy judge overruled an objection by the liquidators of Lehman Brothers Australia Ltd. at the hearing. The liquidators previously opposed another extension of stay on the lawsuit filed by LBHI's special financing unit against BNY Mellon Corporate Trustee Services Ltd. They expressed concern that the resolution of the lawsuit would be delayed further by another extension of stay. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Seeks to Sanction Two SPV Issuers -------------------------------------------------- Lehman Brothers Financial Products, Inc., asks the Court to hold two special purpose vehicle issuers and adversary proceeding defendants accountable for their contumacious violations of the Court's Alternative Dispute Resolution Procedures Order for Affirmative Claims of the Debtors under Derivatives Transactions with Special Purpose Vehicle Counterparties, dated March 3, 2011. Peter Gruenberger, Esq., at Weil Gotshal & Manges LLP, in New York, contends that awarding sanctions against the Counterparty will deter other issuers from adopting that Counterparty's tactic of refusing to participate substantively in the SPV ADR process by relying on untenable arguments about their alleged lack of authority to engage in settlement negotiations with the Debtors, despite being the Debtors' contractual counterparties and despite being adversary proceeding defendants. Mr. Gruenberger also argues that to allow the Counterparty to evade the SPV ADR Order as it is seeking to do would invite the Debtors' numerous other issuer counterparties to make similarly baseless arguments and, thereby, subvert the purpose of the SPV ADR Order and grind the SPV ADR process to a halt -- potentially crippling the Debtors' efforts to resolve the hundreds of outstanding disputes involving derivatives transactions with SPVs. In his declaration supporting the request, Locke R. McMurray, managing director of Lehman Brothers Holdings Inc.'s Derivative Legal, disclosed that the Counterparty asserted that they were "not the proper parties for resolving this dispute at mediation" and that they "lack authority" to enter a settlement, despite having previously served its settlement authority designation, which identified a director of the Counterparty "as having complete settlement authority to negotiate all disputed amounts." LBFP thus asks the Court to compelling Counterparty to acknowledge to the Court in writing that (1) it has full authority to negotiate a settlement of the dispute with LBFP in SPV ADR No. 159 and (2) it will participate in mediation with LBFP in good faith. In the alternative, the LBFP asks the Court to (1) enter a default judgment against Counterparty in the Adversary Proceeding; (2) order Counterparty I to pay LBFP $7,154,607 as a termination payment due under the Counterparty I Swap Agreement, plus periodic payments due and owing of $1,587,853; (3) order Counterparty II to pay LBFP $3,165,676 as a termination payment due under the Counterparty II Swap Agreement; and (4) order Counterparty to pay interest on all other amounts at the applicable rates. LBFP also asks an award of a sum sufficient to reimburse it for the attorneys' fees and costs incurred in responding to Counterparty's frivolous position, including the attorney's fees and costs associated with preparing and prosecuting this Motion. SPV Issuers Object In a redacted document filed with the Court, counsel for the Counterparty insists that the SPV Issuers/Counterparty have fully complied with the Debtors' requests relating to the ADR proceeding, and have designated a settlement representative. The Counterparty, however, found discrepancies in the scope of their authority under certain Indentures versus the authority that was necessary to participate in the ADR proceeding in the manner demanded by the Debtors. Specifically, the counsel said that the representative had full authority to participate in the ADR proceeding and bind the Counterparty, but the Counterparty did not have the authority under the Indentures to bind noteholders and could, therefore, not impart authority on the representative. The counsel also discloses that he has reached out to the Debtors to discuss the substantive issues relating to the Counterparty's authority but he was ignored. LBFP Talks Back In its objection, the Counterparty attempts to cast their refusal to participate in good faith in the ADR process as a mere disagreement about the scope of their authority to bind noteholders under the Indentures, Mr. Gruenberger tells the Court. They also seek to create the misimpression that they attempted to engage in substantive discussions with LBFP, but neither is accurate, he contends. In fact, the Objection itself is but another example of the shell game the Counterparty has played to stall the ADR process and delay resolution of the adversary proceeding, Mr. Gruenberger alleges. Fortunately, he notes, rather than engage in those machinations, about 175 other counterparties in the ADR process have taken seriously the Court's ADR orders, leading to intensely negotiated settlements that has surpassed the $1 billion level. Meredith B. Parenti, Esq., at Weil, Gotshal & Manges LLP, in Washington, D.C. -- meredith.parenti@weil.com -- filed a declaration supporting LBFP's reply. She presented to the Court certain records maintained by Weil Gotshal relating to the Debtors' transactions with the Counterparty. Parties Stipulate Following discussions to resolve their differences, the Parties have agreed that notwithstanding the Counterparty's belief that it has already served LBFP with an ADR Response that fully complied with the SPV ADR Order and LBFP's contention that Counterparty is in violation of that order, the Counterparty agrees to serve LBFP with a confidential ADR Response by January 27, 2012, addressing the merits of LBFP's ADR Notice specifically with respect to LBFP's contentions concerning (i) that the purported modification to LBFP's payment priority under the Indentures violates the Bankruptcy Code's prohibition on ipso facto clauses, (ii) the reasonableness of the settlement amounts calculated by the investment advisor, and (iii) whether the Counterparty owes LBFP the amounts stated in its ADR notice. The Counterparty agrees that it has full authority to negotiate a settlement for itself of the dispute with LBFP in SPV ADR No. 159. The Parties also agree that notwithstanding LBFP's claims to the contrary, Counterparty believes it has participated in the ADR process in good faith and further agrees that it will participate in good faith in the ADR process, including mediation. LBFP subsequently withdrew its motion for sanctions, without prejudice. LBFP reserves its rights to renew the Motion on any grounds in the future. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LOS ANGELES DODGERS: Files Sale-Based Reorganization Plan --------------------------------------------------------- The Los Angeles Dodgers filed with the Bankruptcy Court the Joint Plan of Reorganization under Chapter 11. The plan resolves fully the financial challenges confronting the Dodgers that precipitated the filing by the debtors of the Chapter 11 cases through a sale of all of the equity of the Dodgers, which will result in a change in ownership of the team. As a result of the intended sale and the related reorganization of the Debtors, the plan contemplates that all creditor claims will be satisfied in full either through their assumption by the reorganized debtors or by the payment of cash from proceeds from the sale of the Dodgers. The club stated, "The Dodgers are fully committed to maximizing the value of the debtors' estates. The Dodgers are not only a storied franchise with truly global appeal, but also present the attractive potential for strong cash flow and significant value enhancement. The combination of these unique attributes is helping to drive significant interest from potential bidders in the Dodger sale process. The Dodgers expect to identify the highest and best bid prior to the Confirmation Hearing, which is anticipated to be in April." Implementation of the Plan of Reorganization will include the consummation of a sale transaction on or promptly following the Effective Date of the Plan. The Debtors expect the Effective Date will occur on or before April 30, 2012. Full Payment with 0.l7% Interest Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that under the Plan, all claims are to be paid in full, leaving only the baseball club's owners to vote for approval of the plan. The plan carries out settlements previously reached with the commissioner of Major League Baseball and Fox Entertainment Group Inc., the broadcaster with television rights through the 2013 season. The confirmation hearing for approval of the plan is currently set for April 13, allowing the sale to be completed by the April 30 deadline pursuant to the settlement between the club and the commissioner. The MLB settlement allows the sale of the stadium along with the team if owner Frank McCourt agrees. Unsecured creditors with claims ranging between $3.8 million and $8.4 million will be paid along with 0.l7% interest from the beginning of the Chapter 11 case in June until the claim is paid. The interest rate is the rate paid on judgments issued by federal courts. All other claims, secured and priority, will be paid in full in cash or be assumed by the team's buyer. The Dodgers crafted the agreement with the commissioner to ensure that the bidder with the highest offer ends up as the buyer. About Los Angeles Dodgers Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a professional Major League Baseball club in the Los Angeles metropolitan area. Frank McCourt, a Boston real-estate developer who unsuccessfully bid for the Boston Red Sox, bought the Dodgers from Rupert Murdoch's Fox Entertainment Group, Inc. in 2004 for $330 million. Mr. McCourt also bought the Dodgers Stadium from Fox for $100 million. Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB Commissioner Bud Selig rejected a television deal with News Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for June 30 and July 1. Fox Sports has exclusive cable television rights for Dodgers games until the end of 2013 baseball season. Chapter 11 filings were also made for LA Real Estate LLC, an affiliated entity which owns Dodger Stadium, and three other related holding companies. The petition estimates assets of up to $500 million and debts of up to $1 billion. In its schedules, the LA Dodgers baseball club disclosed $77,963,734 in assets and $4,695,702 in liabilities. LA Real Estate LLC disclosed $161,761,883 in assets and $0 in liabilities. According to Forbes, the team is worth about $800 million, making it the third most valuable baseball team after the New York Yankees and the Boston Red Sox. Judge Kevin Gross presides over the case. Lawyers at Young, Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Public relations specialist Kekst and Company has been hired for crisis support. Covington & Burling LLP serves as special counsel. An official committee of unsecured creditors has been appointed in the case. The panel has tapped Lazard Freres & Co. as financial adviser and investment banker, and Morrison & Foerster LLP and Pinckney, Harris & Weidinger, LLC as counsel. The LA Dodgers is the 12th sports team in North America to have sought bankruptcy protection. The reorganization is being financed with a $150 million unsecured loan from the Commissioner of Major League Baseball. The loan gives the Commissioner few of the controls lenders often demanded from bankrupt companies. LOS ANGELES DODGERS: Can Hire Deloitte as Tax Services Provider --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Los Angeles Dodgers LLC, et al., to employ Deloitte Tax LLP in order to, among other things, prepare tax basis balance sheet, calculate various adjustment, and review various transactions. The Debtor will pay Deloitte $158,000 for the engagement. About Los Angeles Dodgers Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a professional Major League Baseball club in the Los Angeles metropolitan area. Frank McCourt, a Boston real-estate developer who unsuccessfully bid for the Boston Red Sox, bought the Dodgers from Rupert Murdoch's Fox Entertainment Group, Inc. in 2004 for $330 million. Mr. McCourt also bought the Dodgers Stadium from Fox for $100 million. Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB Commissioner Bud Selig rejected a television deal with News Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for June 30 and July 1. Fox Sports has exclusive cable television rights for Dodgers games until the end of 2013 baseball season. Chapter 11 filings were also made for LA Real Estate LLC, an affiliated entity which owns Dodger Stadium, and three other related holding companies. The petition estimates assets of up to $500 million and debts of up to $1 billion. In its schedules, the LA Dodgers baseball club disclosed $77,963,734 in assets and $4,695,702 in liabilities. LA Real Estate LLC disclosed $161,761,883 in assets and $0 in liabilities. According to Forbes, the team is worth about $800 million, making it the third most valuable baseball team after the New York Yankees and the Boston Red Sox. Judge Kevin Gross presides over the case. Lawyers at Young, Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Public relations specialist Kekst and Company has been hired for crisis support. Covington & Burling LLP serves as special counsel. An official committee of unsecured creditors has been appointed in the case. The panel has tapped Lazard Freres & Co. as financial adviser and investment banker, and Morrison & Foerster LLP and Pinckney, Harris & Weidinger, LLC as counsel. The LA Dodgers is the 12th sports team in North America to have sought bankruptcy protection. The reorganization is being financed with a $150 million unsecured loan from the Commissioner of Major League Baseball. The loan gives the Commissioner few of the controls lenders often demanded from bankrupt companies. MACCO PROPERTIES: Trustee Can Hire Andrew Schmidt as Accountant --------------------------------------------------------------- The Bankruptcy Court authorized Michael E. Deeba, the Chapter 11 Trustee of Macco Properties, Inc., to employ Andrew G. Schmidt of Schmidt & Associates, PC, as his accountant to assist in the preparation of all tax returns for the estate and the related entities. Schmidt will charge an hourly rate of $125 for all professional services rendered. About Macco Properties Oklahoma City, Oklahoma-based Macco Properties, Inc., is a property management company that is the sole or controlling member and/or manager of numerous multi-family residential rental units in Oklahoma City, Oklahoma, Wichita, Kansas, and Dallas, Texas, and several and commercial business properties in Oklahoma City, Oklahoma, and Holbrook, Arizona. The Company filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 10-16682) on Nov. 2, 2010. The Debtor disclosed $50,823,581 in total assets, and $4,323,034 in total liabilities. The Official Unsecured Creditors' Committee is represented by Ruston C. Welch, at Welch Law Firm, P.C., in Oklahoma City, Oklahoma. As reported in the TCR on June 17, 2011, the Bankruptcy Court approved the appointment of Michael E. Deeba as the Chapter 11 trustee in the case of Macco Properties, Inc. James H. Bellingham, Esq., and Janice D. Loyd, Esq., at Bellingham & Loyd, P.C., in Oklahoma City, Okla., represent the Trustee as counsel. MAXIM CRANE: Moody's Downgrades CFR/PDR to Caa1; Outlook Stable --------------------------------------------------------------- Moody's Investors Service has downgraded Maxim Crane Works, L.P. (Maxim) corporate family rating (CFR) and probability of default rating (PDR) to Caa1 from B3 and its $250 million second lien notes to Caa2 from Caa1. The ratings outlook is stable. The downgrade reflects the company's weak credit metrics, which are not anticipated by Moody's to improve meaningfully, weak liquidity profile, and anticipated anemic recovery in the U.S. non-residential construction market, a primary driver of crane utilization. Moody's believes that the company's financial performance will continue to be hindered by its leveraged capital structure, low interest coverage, and weak demand and pricing for rental equipment for much of 2012. Until the U.S. non-residential construction market begins to improve, or the energy market materially increases crane usage, the company's credit metrics are likely to remain weak. The stable outlook reflects Moody's expectation that credit metrics should stop declining or stabilize over the near term as the U.S. construction market starts to show some modest recovery in 2012. Maxim's well established position as one of the largest crane rental companies in the United States with a national footprint and a broad offering of lift solutions is well positioned to respond to an increase in demand. The company's competitiveness benefits from a relatively young fleet and its ability to move cranes throughout much of the United States to address demand. The Caa2 rating, one notch below the corporate family rating, on the second lien notes reflects their second priority status after a relatively large first lien asset backed loan (unrated). The one notch downgrade of the notes is in line with downgrade of the company's corporate family rating. As a market leader within crane rental, Moody's anticipates the company's recovery should match the pace of any industry recovery. Continued deterioration of credit metrics, in particular Debt to EBITDA above 6.5 times, retained cash flow to debt below 5% or negative free cash flow, could cause further ratings pressure. Although a near-term ratings upgrade is not likely, an EBITA to interest above 1 time, free cash flow to debt of 3% or higher, and improvements in the company's liquidity profile including the extension of or refinancing of the company's ABL may lead to a positive outlook or ratings upgrade. Downgrade Issuer: Maxim Crane Works, L.P. -- Probability of Default Rating to Caa1 from B3 -- Corporate Family Rating to Caa1 from B3 Changed -- Senior Secured Regular Bond/Debenture to Caa2 LGD6-92% from Caa1 LGD5-74% Outlook: -- Outlook Stable --no change The principal methodologies used in this rating were Moody's Global Equipment and Automobile Rental Industry Methodology, published in December 2010 and Loss Given Default for Speculative- grade Non-financial Companies in the U.S., Canada and EMEA published in June 2009. Maxim Crane Works Holdings, Inc., headquartered in Bridgeville, Pennsylvania, is a holding company conducting its operations through Maxim Crane Works, L.P. The company is a nationwide provider of specialized crane rentals and services in the United States with a product offering that includes over 1,200 cranes and operators that are typically employed on an as-needed basis. LTM revenues through September 30, 2011 totaled over $338 million. Maxim is wholly owned by Steelers Holding Corporation, an affiliate of Platinum Equity Capital Partners II, L.P. MC2 CAPITAL: Wants to Incur Unsecured Loan from Shaw Capital ------------------------------------------------------------ MC2 Capital Partners, LLC, asks the U.S. Bankruptcy Court for the Northern District of California for authorization to incur unsecured debt of up to $150,000 from Shaw Capital Partners, LLC. The Debtor will use the loan to pay critical expenses for administration, including the maintenance of property and casualty insurance and security services on the estate's real property. The principal terms of the debtor-in-possession financing are: -- SCP will provide the debtor a revolving line or credit in the maximum amount of $150,000 bearing interest at 10% per annum; -- expenditures will be made pursuant to the budget; -- the loan will be entitle to administrative priority treatment; and -- the loan will be due on the earlier of May 31, 2012, a sale of substantially all of the Debtor's assets, or the Effective Date of the confirmed Plan of Reorganization. A full-text copy of the terms of the agreement and the budget is available for free at: http://bankrupt.com/misc/MC2CAPITAL_agreement-budget.pdf About MC2 Capital MC2 Capital Partners, LLC, based in San Rafael, California, filed for Chapter 11 bankruptcy (Bankr. N.D. Calif. Case No. 11-14366) on Dec. 1, 2011. Judge Alan Jaroslovsky presides over the case. John H. MacConaghy, Esq. -- macclaw@macbarlaw.com -- at MacConaghy and Barnier, PLC, presides over the case. In its petition, the Debtor estimated $10 million to $50 million in assets and $50 million to $100 million in debts. The Debtor's Manager is Monahan Pacific Corporation. Thomas Monahan -- an officer and director of Monahan Pacific Corporation and the holder of 95% of the LLC equity interests in the Debtor -- signed the petition. He has been appointed as responsible individual for the Debtor. MEDICAL INTERNATIONAL: To Seek New Distributors Worldwide --------------------------------------------------------- Medical International Technology, Inc., sent to investors a status report regarding the current and future state of the Company. In the Report the Company said that its focus is to seek new distributors worldwide for the Company's existing products, to increase its sales and improve its share price. -- On Dec. 6, 2011, the Company signed a letter of intent with a new distributor for the Province of Quebec and the Maritimes. This distributor will be targeting the Mesotherapy market only. This exclusive Letter of Intent, when materialised, will be worth $1.8 million dollars. -- After two months of discussions, on Dec. 28, 2011, the Company had a comprehensive understanding with one of the leading European distributor specialising in Animal application who will be selling all of the Company's Agro- Jet products in Netherlands, Germany and Belgium. -- Work in progress in collaboration with the Company's Mexican distributor on the required documents for the certification of the Company's Med-Jet and Meso-Jet products to sell in human applications niche markets, the Company expects the final documents to be submitted to the Mexican authorities within the next 4 weeks. -- MIT received encouraging results from the German doctors using the Company's Med-Jet MBX and H-III in Germany who was performing test for Mesotherapy applications, these results will help the Company's negotiations with Distributors worldwide in many of the Company's niche markets specific applications. -- The Company's plan of sales and expansion into the Chinese market is in the progress. Mr. Karim Menassa, president and chief executive officer, nominated Mr. George Hendy Ad.E, on MIT's Advisory Board. Mr. Hendy is a Partner at Osler, Hoskin & Harcourt LLP, an internationally recognized law firm. Mr. Hendy has been in different law first with different specialization; he has vast experience in Class actions, International Commercial Arbitration and Alternative Dispute Resolution, and Litigation. The nomination and acceptance by Mr. Hendy to join MIT's Advisory Board will strengthen MIT's management team. The addition of Mr. Hendy will also enrich negotiation opportunities with Medical and Pharmaceutical companies and help MIT achieve its goal to partner with multinational corporations. A copy of this Report is available for free at http://is.gd/k8zeRR About Medical International Montreal, Canada-based Medical International Technology, Inc., specializes in production, marketing and the sale of needle-free jet injector products designed for humans and animals, for single and mass injections. PS Stephenson & Co., P.C., in Wharton, Texas, expressed substantial doubt about Medical International Technology's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and has a working capital deficiency. The Company reported a net loss of US$643,439 on US$437,378 of revenues for fiscal 2011, compared with a net loss of US$751,109 on US$510,893 of revenues for fiscal 2010. The Company's balance sheet at Sept. 30, 2011, showed US$1.0 million in total assets, US$1.6 million in total liabilities, and a stockholders' deficit of USU$632,439. MONTANA ELECTRIC: Committee Taps Harold Dye as Attorney ------------------------------------------------------- The Official Committee of Unsecured Creditors of Southern Montana Electric Generation and Transmission Cooperative, Inc., seeks permission from the U.S. Bankruptcy Court for the District of Montana to retain Harold Dye and Dye & Moe, PLLP, as its attorney. The hourly rates of professionals and paraprofessionals of Dye & Moe are: Harold V. Dye $250 Nancy K. Moe $175 Nik G. Geranios $175 Paralegal $60 The firm will also seek reimbursement of costs expended. To the best of the Committee's knowledge, Dye & Moe is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Southern Montana Electric Based in Billings, Montana, Southern Montana Electric Generation And Transmission Cooperative, Inc., was formed to serve five other electric cooperatives. The city of Great Falls later joined as the sixth member. Including the city, the co-op serves a population of 122,000. In addition to Great Falls, the service area includes suburbs of Billings, Montana. Southern Montana filed for Chapter 11 bankruptcy (Bankr. D. Mont. Case No. 11-62031) on Oct. 21, 2011. Southern Montana estimated assets of $100 million to $500 million and estimated debts of $100 million to $500 million. Timothy Gregori signed the petition as general manager. Jon E. Doak, Esq., at Doak & Associates, P.C., in Billings, Montana, serves as the Debtor's counsel. In December 2011, Southern Montana also sought permission to employ the Goodrich Law Firm, P.C., as general co-counsel. Also in December, Lee A. Freeman was appointed as Chapter 11 trustee. Mr. Freeman retained Horowitz & Burnett, P.C., as his counsel and Waller & Womack, P.C., as local counsel. The United States Trustee for Region 18 has appointed an Official Committee of Unsecured Creditors in the case. Standard & Poor's Ratings Services in October lowered its issuer credit rating on SME to 'CC' from 'BBB', and placed the rating on CreditWatch with developing implications. These actions follow the cooperative's Oct. 21 bankruptcy filing under Chapter 11 of the U.S. Bankruptcy Code. According to SME, the filing was in response to failure on the part of some of its members to honor contractual obligations, including payment to the cooperative for services. MOONLIGHT BASIN: Ranch Closes Sale to Lehman Brothers ----------------------------------------------------- Moonlight Basin has closed the sale of substantially all of its assets to an affiliate of Lehman Brothers Holdings Inc. under Moonlight Basin's confirmed chapter 11 plan of reorganization. The sale was an integral component of a global settlement agreement between the parties which also effectuated the dismissal of all claims in the adversary proceeding between Lehman and Moonlight Basin. The settlement agreement, which was the cornerstone of Moonlight Basin's chapter 11 plan, was approved by the Bankruptcy Court for the District of Montana on Sept. 8, 2011, and the chapter 11 plan was confirmed on Oct. 26, 2011. Under the plan, Lehman supplied the funds sufficient to satisfy in full the claims of Moonlight Basin's administrative creditors and provide a substantial recovery for Moonlight Basin's unsecured creditors. "We feel confident about the ongoing success of the Moonlight Basin ski and golf resort and the prospects for developing the real estate within the 8,000 acre project," said Phil Cyburt, managing director at Alvarez & Marsal, the professional services firm that is overseeing LBHI's real estate asset management. Since 2007, Lehman has been funding Moonlight's operations, which include ski, golf and lodging, and plans to continue to do so. The Moonlight team will continue to manage operations of the Resort in the ordinary course of business. Russ McElyea, Chief Operating Officer for Moonlight Basin, added, "Our preparations for the 2011/2012 ski season are now well behind us, and we are encouraged to hear from our guests that we are delivering an outstanding experience. With this settlement now complete, today is a new day for Moonlight Basin, our employees, vendors, guests and the community as a whole." About Moonlight Basin Ennis, Montana-based Moonlight Basin Ranch LP and affiliated Debtors Lone Mountain Food & Beverage, LLC, Moonlight Lodge, LLC, Moonlight Golf, LLC, Moonlight Spa, LLC, Moonlight Basin, LLC, and Moonlight Basin Mezz, LLC, each filed for Chapter 11 bankruptcy protection (Bankr. D. Mont. Case Nos. 09-62327 to 09-62332; 09- 62334) on Nov. 18, 2009. Craig D. Martinson, Esq., and James A. Patten, Esq., who have offices in Billings, Montana, assist the Debtor in its restructuring effort. In its amended schedules, Moonlight Basin Ranch LP disclosed $45,519,089 in assets and $97,407,467 in liabilities as of the petition date. Treeline Springs, LLC, and Mountain Top Construction Company, LLC, filed for Chapter 11 protection (Bankr. D. Mont. Case No. 09-62368, 09-62370) on Nov. 23, 2009. The Debtors, together with their nondebtor affiliates, operate the Moonlight Basin Resort (the ?Resort?), a ski and golf community situated on more than 8,000 acres of land at the north face of Lone Mountain in Big Sky, Montana, approximately 50 miles from Bozeman, Montana. The overall development plan for the Resort also contemplates a total of approximately 1,650 residential dwellings. As of Sept. 2, 2011, approximately 340 units/lots have been sold. The Debtors' Chapter 11 Cases have been consolidated for procedural purposes only and are being jointly administered under case number 09-62327 pursuant to Bankruptcy Rule 1015(b). NATIONAL HOLDINGS: Incurs $4.7 Million Net Loss in Fiscal 2011 -------------------------------------------------------------- National Holdings Corporation reported a net loss of $4.71 million on $126.52 million of revenue for the 12 months ended Sept. 30, 2011, compared with a net loss of $6.63 million on $110.95 million of revenue during the prior year. "The market volatility over the past fiscal year resulted in a challenging business setting, yet despite this difficult environment, we grew our consolidated revenues to $126.52 million for the fiscal year ended September 30, 2011 compared to $110.95 million for the fiscal year ended September 30, 2010 reflecting a growth of 14%," stated Mark Goldwasser, Chief Executive Officer. "We look forward to the future with a high level of optimism, as we believe that the Company is well positioned to achieve success should the markets stabilize and improve; we continue to strive towards improving our profit margins through continued growth, cost reduction initiatives and realizing greater efficiencies." "We continue to leverage our diverse revenue base, including our strategic product initiatives, overall retail advisory channel and our investment banking team all of which resulted in an increase in our overall commission income by approximately 16% and investment banking revenues by approximately 6% for the year ended September 30, 2011 as compared to the same period ending in 2010," stated Leonard J. Sokolow, President and Vice Chairman. "As we progress into our FY 2012 we see that favorable markets should continue to reward the infrastructure we have put in place and enable us to benefit from strategic initiatives generated by the ever changing market place." The net profit before interest, taxes, depreciation and amortization (EBITDA), adjusted to exclude non-cash compensation expense and write down of forgivable loans, was $.12 million for the fiscal year ended Sept. 30, 2011, as compared to a net loss of ($1.52 million) for the fiscal year ended Sept. 30, 2010. This represents an overall adjusted (EBITDA) improvement of $1.64 million from the fiscal year 2010 to the fiscal year 2011. A full-text copy of the press release is available for free at: http://is.gd/yifwEJ About National Holdings New York, N.Y.-based National Holdings Corporation is a financial services organization, operating primarily through its wholly owned subsidiaries, National Securities Corporation, Finance Investments, Inc., and EquityStation, Inc. The Broker-Dealer Subsidiaries conduct a national securities brokerage business through their main offices in New York, New York, Boca Raton, Florida, and Seattle, Washington. Sherb & Co., LLP, in Boca Raton, Florida, expressed substantial doubt about National Holdings' ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses and has a working capital deficit as of Sept. 30, 2011. The Company reported a net loss of $4.7 million on $126.5 million of total revenues for fiscal 2011, compared with a net loss of $6.6 million on $111.0 million on total revenues for fiscal 2010. The Company's balance sheet at Sept. 30, 2011, showed $16.4 million in total assets, $17.8 million in total liabilities, and a stockholders' deficit of $1.4 million. NATIONAL RETAIL: Fitch Affirms Rating on Preferred Stock at 'BB+' ----------------------------------------------------------------- Fitch Ratings has affirmed the credit ratings of National Retail Properties, Inc. (NYSE: NNN) as follows: -- Issuer Default Rating (IDR) at 'BBB'; -- Unsecured revolving credit facility at 'BBB'; -- Senior unsecured notes at 'BBB'; -- Senior unsecured convertible notes at 'BBB'; -- Preferred stock at 'BB+'. The Rating Outlook is Stable. The rating affirmations are supported by NNN's solid credit metrics, which are appropriate for the 'BBB' IDR, as well as the company's diverse portfolio of net lease retail properties that have generated stable cash flows throughout cycles. NNN's fixed-charge coverage ratio (defined as recurring operating EBITDA less recurring capital expenditures and straight-line rents, divided by total interest incurred and preferred stock distributions) was solid at 2.8 times (x) for the 12 months ended Sept. 30, 2011, down slightly from 2.9x for full year 2010. Fitch expects fixed charge coverage to improve through 2013 due to recent acquisitions at attractive spreads combined with long average remaining lease terms of 12 years, and steady fixed charges. In addition, occupancy also remains stable and was 97.2% as of Sept. 30, 2011, up from 97.1% as of Sept. 30, 2010. In a more adverse operating environment than currently anticipated by Fitch, fixed charge coverage could approach 2.0x over the next 12-24 months, which would be more consistent with a 'BBB-' rating. NNN's free-standing retail property portfolio is highly granular and includes 1,298 investment properties spread throughout 47 states, with the largest concentrations in Texas, Florida and Illinois. Moreover, NNN's portfolio is comprised of over 300 tenants, thus limiting individual tenant credit risk. NNN's leverage metrics are strong for the 'BBB' rating category. Net debt to last 12 months recurring operating EBITDA was 5.9x as of Sept. 30, 2011, up from 5.7x as of Dec. 31, 2010, and 4.8x as of Dec. 31, 2009. Leverage at Sept. 30, 2011 and Dec. 31, 2010 was negatively impacted by significant acquisitions towards the end of the period that did not fully contribute to EBITDA on a full-year basis. Applying a normalized run-rate for these acquisitions, and pro forma for the fourth quarter of 2011 (4Q'11) equity offering, leverage would be approximately 5.0x as of Sept. 30, 2011 and 5.3x as of Dec. 31, 2010. Fitch expects leverage to decline and stabilize just below 5.0x over the next 12-24 months. Additionally, NNN has a solid risk- adjusted capitalization ratio of 1.5x, which is strong for the rating category, due to a focus on stabilized, mostly unencumbered retail property assets. In a more adverse operating environment than currently anticipated by Fitch, leverage could exceed 7.0x over the next 12-24 months, which would be weak for the current rating. The rating actions also point to NNN's management team's track record. Management has consistently implemented a business strategy that entails acquiring, owning, and investing in single- tenant retail properties, generally under long-term triple net leases. The company has a solid liquidity profile. Base case liquidity coverage (unrestricted cash, availability under the company's unsecured revolving credit facility and expected retained cash flow after dividends divided by debt maturities and expected recurring capital expenditures) is 1.7x for the period Oct. 1, 2011 through Dec. 31, 2013. NNN's undrawn $450 million unsecured revolving line of credit and well-laddered debt maturity schedule are main drivers of NNN's liquidity surplus. In addition, the financial covenants in the company's unsecured debt agreements do not limit NNN's financial flexibility. NNN's unencumbered asset coverage of unsecured debt (based on a 9% cap rate on 3Q'11 annualized unencumbered NOI) was 2.3x as of Sept. 30, 2011 . This level is adequate for the rating category and provides ample contingent liquidity for NNN. Fitch's credit concerns include NNN's moderate geographical concentration. Texas represents 18.6% of annualized base rents (ABR), with the next largest concentration in Florida (10% of ABR), indicating vulnerability to regional demand drivers. NNN's portfolio also includes non-necessity based retailers (e.g., full-service restaurants, movie theatres, sporting goods) that may be adversely impacted through retail demand cycles. The convenience store industry represented 21.6% of ABR as of Sept. 30, 2011, although this is mitigated by the stable performance of this tenant segment. The next largest industry concentration was full service restaurants at 10% of ABR, which exposes the company to industry specific volatility. Although the portfolio has performed well during the recent downturn, the company has exposure to certain higher credit risk tenants. It is possible that some of the locations leased to these tenants will be vacated in the event of bankruptcy, leading to lost revenue until a property is re-tenanted, or a potential decline in value if the property is sold vacant. The two-notch differential between NNN's IDR and its preferred stock rating is consistent with Fitch's criteria for corporate entities with a 'BBB' IDR. Based on Fitch's report 'Treatment and Notching of Hybrids in Nonfinancial Corporate and REIT Credit Analysis', these preferred securities are deeply subordinated and have loss absorption elements that would likely result in poor recoveries in the event of a corporate default. The Stable Outlook centers on Fitch's expectation that NNN's credit metrics will remain consistent with a 'BBB' rating over the next 12-24 months. In addition, NNN's long-term triple net leases (typically 15 - 20 years in term) and manageable lease expiration schedule contribute to the stable cash flows of the portfolio. The Stable Outlook also takes into account NNN's strong financial flexibility. The following factors may have a positive impact on NNN's ratings and/or outlook: -- Broader tenant and geographic diversity; -- Fixed charge coverage sustaining above 3.0x (fixed charge coverage was 2.8x for the 12 months ended Sept. 30, 2011); -- Net debt to recurring EBITDA sustaining below 5.0x (leverage was 5.9x as of Sept. 30, 2011); -- Unencumbered assets to unsecured debt based on a stressed 9% capitalization rate, sustaining above 3.0x (this ratio was 2.3x as of Sept. 30, 2011). The following factors may have a negative impact on NNN's ratings and outlook: -- Fixed charge coverage sustaining below 2.5x; -- Net debt to recurring EBITDA sustaining above 6.0x; -- Unencumbered asset to unsecured debt ratio sustaining below 2.2x; -- A liquidity coverage ratio sustaining below 1.0x. NATIVE WHOLESALE: Court Sets Feb. 10 as Claims Bar Date ------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of New York has established Feb. 10, 2012, as the deadline for any individual or entity to file proofs of claim against Native Wholesale Supply Company. The Court also set May 21 as the governmental bar date. About Native Wholesale Native Wholesale Supply Company is in the business of importing cigarettes and other tobacco products from Canada and selling them within the United States. It purchases the products from Grand River Enterprises Six Nations, Ltd., a Canadian corporation and the Debtor's only secured creditor. Native is an entity organized under the Sac and Fox Nation and has its principal place of business at 10955 Logan Road in Perrysburg, New York. Native filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No. 11-14009) on Nov. 21, 2011. The Chapter 11 filing was triggered to resolve an ongoing dispute with the United States government regarding up to $43 million in assessments made by the government against the Debtor pursuant to the Fair and Equitable Tobacco Reform Act of 2004 and the Tobacco Transition Payment Program and to restructure the terms of payment of any obligation determined to be owing by the Debtor to the U.S. under the Disputed Assessment. The issues pertaining to the Disputed Assessment resulted in two lawsuits, subsequently consolidated, now pending in the Federal District Court. Fredericks Peebles & Morgan LLP serves as its special counsel. Mengel Mertzger Barr & Co. LLP serves as its accountants. The Company disclosed $30,022,315 in assets and $70,590,564 in liabilities as of the Chapter 11 filing. NEVADA CANCER: Committee Taps Pachulski Stang as Counsel -------------------------------------------------------- The Official Committee of Unsecured Creditors of Nevada Cancer Institute seeks permission from the U.S. Bankruptcy Court for the District of Nevada to retain Pachulski Stang Ziehl & Jones LLP as its counsel. The attorneys currently expected to be principally responsible for the Case, and their respective hourly rates effective as of Jan. 1, 2011, are: Robert J. Feinstein $895 per hour Samuel R. Maizel $725 per hour Shirley S. Cho $650 per hour Jason H. Rosell $395 per hour The hourly rate for the paralegals assigned to the Case, Patricia Jefferies and Felice Harris, is $255. The firm will seek reimbursement of expenses. To the best of the Committee's knowledge, Pachulski Stang is a "disinterested person" within the meaning of section 101(14) of the Bankruptcy Code. About Nevada Cancer Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP; and Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEVADA CANCER: Committee Taps Schwartzer as Local Counsel --------------------------------------------------------- The Official Committee of Unsecured Creditors of Nevada Cancer Institute seeks permission from the U.S. Bankruptcy Court the District of Nevada to retain Schwartzer & McPherson Law Firm as its local bankruptcy counsel. The Committee is informed that the professionals employed in the Debtor's case have voluntarily agreed to a reduction of their fees which have been incurred thus far in connection with the bankruptcy case. Thus, Schwartzer & McPherson has also agreed to voluntarily reduce its fees by 20%. The attorneys currently expected to be principally responsible for the Case, and their respective hourly rates effective Jan. 1, 2012 (without taking into account the 20% discount) are: Leonard E. Schwartzer $500 Jeanette E. McPherson $450 Jason A. Imes $350 Emilia L. Allen $225 Angela Hosey $125 Sheena Clow $125 The firm will seek reimbursement for its customary expenses. To the best of the Committee's knowledge, Schwartzer & McPherson is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Nevada Cancer Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP; and Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEWELL RUBBERMAID: Fitch Affirms Rating on 5.25% QUIPS at 'BB+' --------------------------------------------------------------- Fitch Ratings has affirmed Newell Rubbermaid, Inc.'s (Newell) ratings as follows: -- Long-term Issuer Default Rating (IDR) at 'BBB'; -- Short-term IDR at 'F2'; -- Commercial paper at 'F2'; -- $800 million revolving credit facility at 'BBB'; -- Senior unsecured notes and 5.5% convertible at 'BBB; -- 5.25% convertible quarterly income preferred securities (QUIPS) at 'BB+'. The Rating Outlook is Stable. Approximately $2.1 billion of debt and preferred securities are affected by this action. The ratings reflect Newells' well-known brands, considerable liquidity, and its focus on differentiated global products with prospects for higher growth and margins. The ratings also encompass the cyclical nature of a significant portion of the company's global business units as well as some commodity exposure, albeit at much lower levels than several years ago. That cyclicality and the slow growth environment since 2008 has led to a number of impairments including the $306 million related to the Baby & Parenting business unit in 2011. Newell has managed its diversified portfolio of business units well given economic pressures and volatility in commodity costs. The company has lowered its cost, simplified its capital structure and reduced debt such that its credit protection measures have improved markedly since 2008. Through the last 12 months ended Sept. 30, 2011 (LTM), Newell's leverage of 2.3 times (x) is down almost 1 turn from the 3.2x in 2008. FFO interest coverage has improved sequentially to 7.1x at the LTM from 3.5x in 2008. More importantly, Newell's FCF (operating cash flow less capital expenditure and dividends) has rebounded to $200 million to $375 million annually over the past three years. It is expected to remain in that range through 2012. The Stable Outlook reflects the company's resumption of organic revenue growth in 2010, strong cash flow generation, and Fitch's expectation that share-holder friendly actions will be prudent. Newell is at the end of major restructuring efforts, although some fine-tuning related to the European Transformation and Project Renewal is ongoing. Given this, there would be cushion in the rating to accommodate bolt-on acquisitions or prudent shareholder- friendly actions as long as leverage (total debt with equity credit/EBITDA) remains in the 2x to 3x range. Fitch expects some pressure on revenues given Newell's moderate level of sales from developed markets in Europe. However, it should be partially blunted by growth in developing markets. Additionally, the company's focus on costs and Fitch's expectation that commodity costs have stabilized somewhat should ensure that profits and cash flows remain relatively stable. It is noteworthy that despite the fact that Newell has been restructuring for much of the past decade, it has generated positive free cash flow since at least 1996. For the nine months ended Sept. 30, 2011 revenues increased 3.6% paced by foreign exchange translation of 2.5% and core growth (volume/price/mix) of 1.1% to $4.4 billion. Higher commodity costs such as resin and packaging material resulted in the gross margin declining 50 basis points to 37.7%. Debt balances declined $54 million to $2.3 billion and is expected to remain in this range in the near term. Newell's financial flexibility is ample. The company had $139 million in cash on hand, a new five-year, $800 million revolver and $100 million of availability under its receivables facility which provides more than $1 billion in liquidity. Newell is expected to extend the 364-day receivable facility in September 2012. Long-term debt maturities are relatively heavy in 2012 when the $250 million, 6.75% note is due and in 2013 when a $500 million, 5.5% note is due. Newell is likely to refinance these notes. There are no other long-term debt maturities until 2018. NPC INT'L: Moody's Says 'B2' CFR Unaffected by Acquisition ---------------------------------------------------------- Moody's Investors Service stated that NPC International, Inc.'s ratings are unchanged following the company's announcement that it has agreed to acquire 36 Pizza Hut units from Pizza Hut, Inc. and affiliates for $18.8 million plus an additional amount for inventory, prepaids and store cash. NPC's ratings are as: -- Corporate Family Rating at B2 -- Probability of Default Rating at B2 -- $100 million senior secured revolver due 2016 at Ba3 (LGD3, 32%) -- $375 million senior secured term loan due 2018 at Ba3 (LGD3, 32%) -- $190 million senior unsecured notes due 2020 at Caa1 (LGD5, 85%) -- Speculative Grade Liquidity rating at SGL-3 The ratings outlook is negative. The principal methodology used in rating NPC was the Global Restaurant Industry published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non- Financial Companies in the U.S., Canada and EMEA published in June 2009. NPC International, Inc. is the largest Pizza Hut franchisee operating 1,151 stores in 28 states with concentration in the Midwest, South and Southeastern United States. Annual revenues approach $960 million. NUTRACEA: Completes Two Fund Raising Deals, Adds New Board Member ----------------------------------------------------------------- NutraCea disclosed two fund raising transactions and the addition of a new Board member. The Company disclosed the recent completion of two funding transactions. The first is an $870,000 Original Issue Discount Senior Secured Convertible Note provided by Hillair Capital Investments L.P. The second funding is a Subordinated Convertible Secured Note package totaling $4.3 million, which included the roll-over of $2.3 million in previously issued convertible notes and allows for an authorized total facility amount of $7.5 million. In total, NutraCea raised over $2.7 million in cash prior to related closing costs from these two transactions. NutraCea used existing cash and part of the proceeds of these two fund raising transactions to make the final payments due to its bankruptcy creditors in accordance with terms of its Amended Plan of Reorganization which became effective on Nov. 30, 2010 upon the Company's exit from Chapter 11 Bankruptcy proceedings. Halpern Capital, a FINRA registered broker-dealer, was the Company's investment bank and financial advisor for both transactions. Baruch Halpern, managing partner of Halpern Capital Inc., was a major investor in the Notes package. Other participants in the Notes included new investors as well as current NutraCea shareholders. Weintraub Partners, consisting of attorneys from the Company's lead legal advisor Weintraub, Genshlea, Chediak, Tobin & Tobin LLP.; NutraCea Board members Ed McMillan, Chairman of the Board of Directors; James Lintzenich, Compensation Committee Chair; and W. John Short, Director and CEO, also invested in the Notes. Concurrent with the completion of the funding transactions, Baruch Halpern was appointed to the Board of Directors and Steven Saunders resigned from the Board. In addition, a Majority in Interest of investors in the Notes received the right to nominate another Director to be appointed to the Board. Concurrent with these changes, NutraCea increased the size of its board to seven members. W. John Short, Chief Executive Officer of NutraCea, stated, "The completion of these two fund raising transactions allows us to put the bankruptcy fully behind us and to focus our management team's energies on building NutraCea into a significant player in the global food ingredient industry." Mr. Short continued, "I welcome Baruch Halpern to the NutraCea Board of Directors. Baruch has been a shareholder, financial advisor and strong supporter of NutraCea for several years and is very knowledgeable about the strategies and future direction we have set for our Company. I want to thank Baruch and his team for their support in closing both of these fund raising transactions. In addition, I want to thank Steven Saunders for his support of the company and his service to the Board over many years." About Nutracea Scottsdale, Arizona-based NutraCea (NTRZ.pk) -- http://www.nutraceaonline.com/-- is a food ingredient and health company focused on the procurement, processing and refinement of rice bran and derivative products. The Company has proprietary intellectual property that allows it to process and convert rice bran, one of the world's most underutilized food resources, into a highly nutritious ingredient, stabilized rice bran (SRB) that has applications in various food products. Nutracea filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 09-28817) on Nov. 10, 2009. NutraCea emerged from Chapter 11 bankruptcy protection effective Nov. 30, 2010. NUTRACEA: Makes Final Payments Under Plan of Reorganization ----------------------------------------------------------- NutraCea disclosed final payment of all amounts due to creditors under the terms of its Plan of Reorganization. The Company confirmed today that it has met all of its obligations under the terms of the Amended Plan of Reorganization approved by the US Bankruptcy Court. W. John Short, Chief Executive Officer of NutraCea, stated, "We are pleased to have made the final payments due to all creditors under the Amended Plan of Reorganization. We are proud to have paid in full all of the lenders, suppliers and vendors who supported NutraCea during the entire reorganization process that began with our Chapter 11 filing in November 2009 and culminated in our final payments to creditors at the beginning of this week. No creditor that participated in the court supervised restructuring process lost money doing business with NutraCea. "NutraCea used the Chapter 11 process exactly as it was intended. Under the supervision of the bankruptcy court, we restructured our business, repaid all creditors in full and protected the interests of the shareholders who invested in NutraCea prior to the bankruptcy filing. I want to offer special thanks to Cary Forrester, bankruptcy counsel who represented NutraCea throughout the proceedings, for his guidance and wise counsel in guiding us through this complex process." The Company's bankruptcy counsel, S. Cary Forrester, of Forrester & Worth, in Phoenix, Arizona, commented: "This is an extraordinary outcome. In the vast majority of Chapter 11 filings, the pre- petition owners lose most or all of their ownership interests and unsecured creditors receive pennies on the dollar. In fact, according to one study of bankruptcy outcomes, less than 10% of Chapter 11 debtors confirm and complete a plan of reorganization. In this case, NutraCea not only exited Chapter 11 intact and paid all of its debts in full, but it did so in a way that allowed its shareholders to retain 100% of their ownership interests in the Company." About Nutracea Scottsdale, Arizona-based NutraCea (NTRZ.pk) -- http://www.nutraceaonline.com/-- is a food ingredient and health company focused on the procurement, processing and refinement of rice bran and derivative products. The Company has proprietary intellectual property that allows it to process and convert rice bran, one of the world's most underutilized food resources, into a highly nutritious ingredient, stabilized rice bran (SRB) that has applications in various food products. Nutracea filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 09-28817) on Nov. 10, 2009. NutraCea emerged from Chapter 11 bankruptcy protection effective Nov. 30, 2010. OPEN RANGE: Wants to Employ Anton Collins as Tax Advisor -------------------------------------------------------- Open Range Communications Inc. seeks permission from the U.S. Bankruptcy Court for the District of Delaware to employ Anton Collins Mitchell LLP as its tax advisor. ACM LLP will assist the Debtor in preparing and filing state and local tax returns for the 2011 and 2012 tax years and will provide an audit of the Open Range Communications Inc. 401(k) Profit Sharing & Trust. ACM LLP's hourly rates for the preparation of property tax returns will be: Partner $350 Director $245 Manager $220 Senior $155 Staff $115 The hourly rates charged by ACM LLP professionals in the audit group are: Partner $300 - $350 Director $275 - $300 Manager $180 - $250 Senior $125 - $180 Staff $100 - $125 ACM LLP has requested a retainer of $15,000 for the audit services. ACM LLP will seek reimbursement of expenses. The Debtor believes that ACM LLP is a "disinterested person" as that term in defined in Section 101(14) of the Bankruptcy Code. About Open Range Greenwood Village, Colo.-based Open Range Communications Inc., a provider of wireless broadband services to 26,000 rural customers in 12 states, filed a Chapter 11 petition (Bankr. D. Del. Case No. 11-13188) on Oct. 6, 2011, to either sell the business or shut down and liquidate. Open Range disclosed about $115.1 million in assets and $102.8 million in debts. Open Range started its WiMax broadband and voice service in late 2009, backed by a $267 million loan from the U.S. Department of Agriculture's Rural Utility Service and $100 million invested by One Equity Partners, a financing arm of JPMorgan Chase & Co. Judge Kevin J. Carey presides over the case. Marion M. Quirk, Esq., at Cole, Schotz, Meisel, Forman & Leonard, serves as bankruptcy counsel. Logan & Co. serves as claims agent. FTI Consulting, Inc., will provide a chief restructuring officer, Michael E. Katzenstein; an associate chief restructuring officer, Chris Lewand; and hourly temporary staff. The petition was signed by Chris Edwards, chief financial officer. On filing for Chapter 11 protection, Open Range said it would shut down and liquidate the network if a buyer couldn't be found. Roberta A. DeAngelis, the United States Trustee for Region 3, pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed seven unsecured creditors to serve on the Official Committee of Unsecured Creditors of Open Range Communications Inc. In December 2011, Ann Schrader at the Denver Post reported that Open Range has shut down operations after failing to get the broadcast spectrum it needed, problems with network quality and vendors, and the "sporadic" flow of money from a $267 million federal loan, of which Open Range owes a balance of $73.5 million. Open Range hired RB Capital LLC and Heritage Global Partners Inc. as auctioneers and sales agents to conduct an auction of the Debtor's assets. ORCHARD SUPPLY: Moody's Confirms CFR at 'B3', Outlook Negative -------------------------------------------------------------- Moody's Investors Service confirmed Orchard Supply Hardware Stores Corporation Corporate Family and Probability of Default Ratings at B3. Moody's also confirmed the B3 rating of the company's $59 million Senior Secured Term Loan due December, 2013 and assigned a B3 rating to the $78 million Senior Secured Term Loan tranche that was recently extended to December, 2015. The rating outlook is negative. The rating actions resolve the review for possible downgrade that commenced on June 28, 2011. These ratings were confirmed and LGD assessments amended: Corporate Family Rating at B3 Probability of Default Rating at B3 Senior Secured Term Loan due 2013 at B3 (LGD 4,56% from LGD 4, 54%) This rating was assigned: Senior Secured Term Loan due 2015 at B3 (LGD 4, 56%) RATINGS RATIONALE The confirmation of the B3 CFR reflects Moody's expectations that OSH will be able to continue recent positive trends in comparable store sales into fiscal 2012 as a result of initiatives taken by its relatively new management team. Moody's expects these initiatives will enable the company to offset a significant portion of the incremental costs associated with its transition to a publicly-traded company independent of Sears Holdings Corporation (B3/Negative) following the conclusion of the spin-off on December 30, 2011. The company has also taken steps to improve liquidity by utilizing proceeds from recent asset sales to reduce debt as well as extending a meaningful portion of its Senior Secured Term Loan by two years to 2015. The confirmation also reflects the company's December 2011 amendments to its credit agreements which provided it with additional cushion under its financial covenants. OSH's B3 rating reflects the company's still high financial leverage, with debt/EBITDA for the LTM period ending 10/29/2011 of approximately 6.7 times. The rating also reflects execution risks associated with the transition from a majority-owned subsidiary of Sears to a stand-alone company. The company will need to deliver continued improvements in same store sales and at least maintain if not improve operating margins to offset the impact of higher stand-alone company costs. The B3 rating also reflects the company's narrow geographic focus with a presence only in the state of California and the continued challenging economic environment in that state. The rating outlook is negative, as ratings could be downgraded if the company is unable to execute operating strategies to improve operating performance to a sufficient degree to offset expected increases in operating costs in fiscal 2012 following its spin-off by Sears. The negative rating outlook also reflects the company's still significant 2013 debt maturities. In view of the negative, outlook ratings are unlikely to be upgraded. The rating outlook could be stabilized if the company were to demonstrate stable earnings and positive comparable store sales while also further addressing its 2013 debt maturities. Quantitatively the rating outlook could be stabilized if debt/EBITDA approached 6 times. Over time ratings could be upgraded if EBITA/interest exceeded 1.5 times and debt/EBITDA was sustained below 5.25 times. Ratings could be lowered if over the next couple quarters the company does not demonstrate stable operating earnings, which would indicate that its strategies are not fully effective to offset higher operating costs resulting from the spin off. Ratings could also be lowered if the company does not begin to make further progress to address its late 2013 debt maturities. The principal methodology used in rating Orchard Supply Hardware Stores was the Global Retail Industry 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. Headquartered in San Jose, California, Orchard Supply Hardware Stores Corporation is a specialty home improvement retail carrying a broad range of merchandise across repair and maintenance, lawn and garden and in-home products. The company operated 87 stores in California. LTM revenues are approximately $660 million. PACESETTER FABRICS: OK'd to Use Cash Collateral Until March 16 -------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California approved third stipulation authorizing Pacesetter Fabrics, LLC's to use the cash collateral until March 16, 2012. The stipulation, entered between the Debtor and Cathay Bank, provides for among other things: -- during the Third Extended Period, the Debtor will pay to lender all payments required under the Third Revised Budget, including without limitation not less than the additional amounts of not less than three $100,000 scheduled periodic payments at the times specified in the Third Revised Budget; and -- the Debtor consent to the immediate grant by the Court of relief from the automatic stay for lender to enforce against Mixxed 26, LLC in any court of competent jurisdiction any and all claims against Mixxed 26, including without limitation to collect any money owed to Debtor by Mixxed 26. A full-text copy of the stipulation is available for free at http://bankrupt.com/misc/PACESETTER_FABRICS_cashcoll_3rdstipulatio n.pdf As reported in the Troubled Company Reporter on Sept. 22, 2011, the bank asserted that it is owed $12.6 million in the aggregate plus attorneys' fees and costs as of June 17, 2011, under various prepetition secured loan agreements with the Debtor. The debt includes a $17.5 million loan under a 2009 agreement among Pacesetter, its affiliate Rock L.A. Fashion LLC, and the bank. The Debtor and Rock defaulted on the loan by failing to make payment due December 2009. In February 2010, the parties executed a forbearance agreement; the lender also provided a $4.3 million term loan to pay down the prior loan. The term loan was due April 30, 2011. The Debtor and Rock defaulted on the loans by failing to make required payments and violating disclosure requirements. The Debtor is also a guarantor under a $2 million loan extended by the bank to Ramin Namvar, the manager of both the Debtor and Rock. Mr. Namvar is also in default of his loan. About Pacesetter Fabrics Based in City of Commerce, California, Pacesetter Fabrics, LLC, dba Pacesetter Off Price and Pacesetter Garments, is a distributor of quality textile and garment fabrics in the United States and international markets. The Company has been in business for over 14 years. The Company is owned 98% by Net, LLC, a California limited liability company, 1% by Leora Namvar (Ramin Namvar's wife), and 1% by Massoud Poursalimi (Leora Namvar and David Poursalimi's father). Net LLC is in turn owned 99% by Ramin Namvar and 1% Leora Namvar. Pacesetter Fabrics filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-36330) on June 17, 2011, estimating assets and debts of $10 million to $50 million. Judge Ernest M. Robles presides over the case. The Debtor is represented by Brian L. Davidoff, Esq., C. John M. Melissinos, Esq., and Claire E. Shin, Esq., at Rutter Hobbs & Davidoff Incorporated. Brian Wygle -- Brian@lazarusresources.com -- president of Lazarus Resources Group, LLC, a corporate turnaround consultant, assists Pacesetter with its turnaround and reorganization efforts and the financial affairs and management of the Company. PEAK BROADCASTING: Taps Sheppard Mullin as Chapter 11 Counsel ------------------------------------------------------------- Peak Broadcasting LLC and its debtor-affiliates seek Bankruptcy Court permission to employ Sheppard, Mullin, Richter & Hampton LLP as Chapter 11 counsel. The principal Sheppard Mullin attorneys who are presently designated to represent the Debtors are partner Ori Katz and associate Robert K. Sahyan. Their hourly rates are normally $620 and $455, respectively. Sheppard Mullin has agreed to discounts its fees by 10%. Other Sheppard Mullin attorneys may render limited services on discrete matters requiring their particular expertise or when the principal attorneys are unavailable, and those other attorneys will be subject to this 10% discount as well. Sheppard Mullin has received payments from the Debtors during the year prior to the Petition Date for $391,049.67 in connection with its prepetition representation of the Debtors. Of this amount, $331,596.95 was applied prepetition toward the payment of Sheppard Mullin's fees and expenses incurred through the Petition Date. Mr. Katz attests that Sheppard Mullin is a "disinterested person" within the meaning of section 101(14) of the Bankruptcy Code. The firm may be reached at: Ori Katz, Esq. Robert K. Sahyan, Esq. SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Four Embarcadero Center Seventeenth Floor San Francisco, CA 94111 Tel: 415-774-3238 E-mail: okatz@sheppardmullin.com rsahyan@sheppardmullin.com About PEAK Broadcasting PEAK Broadcasting LLC, in Fresno, California, filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 12-10183) on Jan. 10, 2012. PEAK Broadcasting, founded in 2006-2007, operates radio stations in Fresno, California, and Boise, Idaho. Several affiliates also sought Chapter 11 protection: Peak Broadcasting of Fresno LLC; Peak Broadcasting of Boise LLC; Peak Broadcasting of Fresno Licenses LLC; and Peak Broadcasting of Boise Licenses LLC. In its petition, Peak Broadcasting estimated $50 million to $100 million in assets and debts. The petition was signed by Todd Lawley, CEO and managing member. PEAK Broadcasting filed together with the petition a prepackaged plan of reorganization. The plan provides for payments to the Company's employees, vendors and other unsecured creditors, and for the business to continue in the ordinary course with no disruption. Judge Peter Walsh, who oversees the case, set a hearing to confirm the prepack plan for Feb. 23. Pachulski Stang Ziehl & Jones LLP serves as the Debtors' Chapter 11 local counsel. PEAK BROADCASTING: Taps Pachulski as Local Bankruptcy Counsel ------------------------------------------------------------- Peak Broadcasting LLC and its debtor-affiliates seek Bankruptcy Court permission to employ Pachulski Stang Ziehl & Jones LLP as their Chapter 11 local counsel. The principal attorneys and paralegals presently designated to represent the Debtors and their current standard hourly rates are: Joshua M. Fried, Esq. $650 Michael R. Seidl, Esq. $575 C. Margaret L. McGee (paralegal) $245 Mr. Seidl, Esq., attests that Pachulski does not hold or represent any interest adverse to the Debtors' estates, and is a "disinterested person" as that phrase is defined in section 101(14) of the Bankruptcy Code. Pachulski has received payments from the Debtors during the year prior to the Petition Date in the amount of $49,283.50, including the Debtors' aggregate filing fees for these cases, in connection with its prepetition representation of the Debtors. About PEAK Broadcasting PEAK Broadcasting LLC, in Fresno, California, filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 12-10183) on Jan. 10, 2012. PEAK Broadcasting, founded in 2006-2007, operates radio stations in Fresno, California, and Boise, Idaho. Several affiliates also sought Chapter 11 protection: Peak Broadcasting of Fresno LLC; Peak Broadcasting of Boise LLC; Peak Broadcasting of Fresno Licenses LLC; and Peak Broadcasting of Boise Licenses LLC. In its petition, Peak Broadcasting estimated $50 million to $100 million in assets and debts. The petition was signed by Todd Lawley, CEO and managing member. PEAK Broadcasting filed together with the petition a prepackaged plan of reorganization. The plan provides for payments to the Company's employees, vendors and other unsecured creditors, and for the business to continue in the ordinary course with no disruption. Judge Peter Walsh, who oversees the case, set a hearing to confirm the prepack plan for Feb. 23. Sheppard, Mullin, Richter & Hampton LLP serves as the Debtors' Chapter 11 counsel. PEAK BROADCASTING: Taps Edinger as Counsel to FCC Matters --------------------------------------------------------- Peak Broadcasting LLC and its debtor-affiliates have engaged Edinger Associates as special counsel to advise and assist the Debtors with matters involving their Federal Communications Commission licenses. The Debtors' prepackaged plan of reorganization calls for the transfer of their FCC licenses to a trust. The firm will be paid at these rates: Scott Woodworth $300 Ladd Johnson $300 Brook Edinger $375 Mr. Woodworth -- swoodworth@edingerlaw.net -- attests that Edinger does not hold or represent any interest adverse to the Debtors' estates, qualifying Edinger as a "disinterested person" as that phrase is defined in Bankruptcy Code section 10 1(14). Edinger has received payments from the Debtors during the year prior to the Petition Date for $26,062, including the Debtors' aggregate filing fees for these cases, in connection with its prepetition representation of the Debtors. Edinger has been paid current as of Jan. 8, 2012, and holds a prepetition retainer from the Debtors for $10,000. About PEAK Broadcasting PEAK Broadcasting LLC, in Fresno, California, filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 12-10183) on Jan. 10, 2012. PEAK Broadcasting, founded in 2006-2007, operates radio stations in Fresno, California, and Boise, Idaho. Several affiliates also sought Chapter 11 protection: Peak Broadcasting of Fresno LLC; Peak Broadcasting of Boise LLC; Peak Broadcasting of Fresno Licenses LLC; and Peak Broadcasting of Boise Licenses LLC. In its petition, Peak Broadcasting estimated $50 million to $100 million in assets and debts. The petition was signed by Todd Lawley, CEO and managing member. PEAK Broadcasting filed together with the petition a prepackaged plan of reorganization. The plan provides for payments to the Company's employees, vendors and other unsecured creditors, and for the business to continue in the ordinary course with no disruption. Judge Peter Walsh, who oversees the case, set a hearing to confirm the prepack plan for Feb. 23. Sheppard Mullin Richter & Hampton LLP serves as the Debtors' bankruptcy counsel and Pachulski Stang Ziehl & Jones as co- counsel. PEAK BROADCASTING: Seeks Approval to Transfer FCC Licenses ---------------------------------------------------------- Peak Broadcasting LLC and its debtor-affiliates ask the Bankruptcy Court to approve a trust agreement under which the Debtors' broadcasting and other licenses issued by the Federal Communications Commission will be transferred to a trust pursuant to the Debtors' prepackaged plan of reorganization. The Debtors also seek to appoint a trustee. On the Petition Date, the Debtors filed a Joint Plan of Reorganization and a related disclosure statement. The Plan is the product of extensive good-faith, arm's length negotiations between the Debtors and their primary stakeholders, including General Electric Capital Corporation, for itself and as agent for the Debtors' prepetition first lien lenders, and Oaktree Capital Management, L.P., a key First Lien Lender. GE, Oaktree and their affiliates own 75% in the aggregate of the outstanding first lien debt claims. The Debtors also negotiated the terms of the Plan with members of the Debtors' Senior Second Lien Lenders and Junior Second Lien Lenders. The lenders' support for the Plan is evidenced by the Restructuring Support Agreement, dated Oct. 12, 2011 and as amended on Dec. 30, 2011. The Plan preserves the Debtors' business as a going concern, and provides for the consensual elimination of roughly $85 million to $90 million in prepetition secured debt. The Restructuring Support Agreement, as amended, requires the Debtors to consummate the Plan by no later than Feb. 29, 2012 to prevent the Debtors from languishing in bankruptcy. The Debtors seek to expeditiously consummate the Plan to mitigate the substantial costs and burdens of administering a chapter 11 case. But, before the Debtors may consummate the Plan, and to effect the Debtors' post-emergence corporate structure, the Debtors must obtain Federal Communications Commission approval for the assignment or transfer of the FCC License Assets. The Debtors said securing the Court's approval now of the FCC Trust Agreement, and authorization to appoint the Trustee, will accelerate the FCC's consideration of the transactions contemplated under the Plan, including the assignment or transfer of the FCC License Assets. The Supporting Lenders support the Court granting the Debtors' request. PENDLETON COUNTY: S&P Cuts Rating on Series 1993B Bonds to 'B' -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term rating on Pendleton County, Ky.'s multi-county lease funding revenue bonds series 1993B, issued on behalf of Kentucky Association of Counties Leasing Trust Program, to 'B' from 'A', and removed it from CreditWatch with developing implications, where it was placed on Oct. 18, 2011. The outlook is stable. The security for the bonds is investment earnings and funds on deposit in an investment agreement (IA) between the trustee (on behalf of the issuer) and Transamerica Life Insurance Co., the IA provider. There are $10 million in funds on deposit with the IA provider, and these funds are earning 6.4% interest. There are $10 million in bonds outstanding and the bonds are paying investors 6.4% interest each interest payment date. The trust indenture calls for certain fees and expenses to be paid from the trust estate. "In our opinion, the trust estate does not have sufficient funds to pay projected debt service and expenses on the bonds, as set forth in our criteria," said Standard & Poor's credit analyst Steve Tencer. "The association indicated to us that it plans to deposit additional funds in the trust estate to make such payments and to amend the documents to be consistent with our criteria. To date, we have not been provided with any amended documents, and we are not aware of the deposit of any funds into the trust estate," S&P said. PENINSULA HOSPITAL: Wants Plan Filing Deadline Extended to Feb. 17 ------------------------------------------------------------------ Peninsula Hospital Center and Peninsula General Nursing Home Corp. are seeking an extension of the initial exclusive right to file a Chapter 11 plan through Feb. 17, 2012. They are seeking an extension of the deadline to solicit acceptances of the plan through Apr. 17, 2012. The Debtors assert that extension of the Exclusive Periods will allow them to continue to work with the Official Committee of Unsecured Creditors to formulate consensual Chapter 11 plans. In constrast, termination of the Exclusive Period, the Debtors insist, could give rise to the threat of multiple plans and a contentious confirmation process that will result in increased administrative expenses and diminished returns to creditors. About Peninsula Hospital Wayne S. Dodakian, Vinod Sinha, and Shannon Gerardi filed an involuntary Chapter 11 bankruptcy protection against Peninsula Hospital Center -- http://www.peninsulahospital.org/-- (Bankr. E.D.N.Y. Case No. 11-47056) on Aug. 16, 2011. Judge Elizabeth S. Stong presides over the case. Marilyn Cowhey Macron, Esq., at Macron & Cowhey, represents the petitioners. Peninsula Hospital Center and Peninsula General Nursing Home Corp., employed Alvarez & Marsal Healthcare Industry Group, LLC, as financial advisors. The Hospital employed Abrams Fensterman, et al., as their attorneys. Nixon Peabody serves as their special counsel; GCG, Inc., serves as claims and noticing agent. Judge Stong appointed Daniel T. McMurray at Focus Management Group as patient care ombudsman. Neubert, Pepe & Monteith P.C. serves as PCO's counsel. Richard J. McCord, Esq., of Certilman Balin, & Hyman, LLP, has been appointed by the Court as examiner in the Debtors' cases. He is tasked to conduct an investigation of the Debtors' relationship and transactions with Revival Home Health Care, Revival Acquisitions Group LLC, Revival Funding Co. LLC, and any affiliates. CBIZ Accounting, Tax & Advisory of New York, LLC and CBIZ, Inc., serve as financial advisors for the Official Committee of Unsecured Creditors. PINNACLE AIRLINES: Chief Executive Says Bankruptcy is Possible -------------------------------------------------------------- Pinnacle Airlines Corp. sent a letter to its employees updating them on the restructuring program announced on Dec. 8, 2011. The Company stated that its financial position continues to worsen at an alarming rate and that it needs to act immediately. "We presented a comprehensive turnaround plan to our Board that focuses on steps required to address our situation. From a liquidity perspective, we have been in active discussions with potential lenders and investors. From a cost perspective, our plan encompasses integration and synergy savings, partner contract changes and labor savings. The Board agreed with management's recommendations and proposed next steps. We have since met regularly and repeatedly with our airline partners, union leadership, potential investors and other parties. Our message has been very clear: we cannot continue to operate businesses that are losing money. We do not have the cash to sustain it." The Company hopes to reach agreement with all of the necessary parties on the changes it needs to implement to ensure the Company's continued viability. It is also possible that the Company may ultimately undergo a court-supervised Chapter 11 process which many other airlines have used successfully in recent years. A full-text copy of the letter is available for free at: http://is.gd/gpFS7w About Pinnacle Airlines Corp. Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/-- a $1 billion airline holding company with 7,800 employees, is the parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.; and Colgan Air, Inc. Flying as Delta Connection, United Express and US Airways Express, Pinnacle Airlines Corp. operating subsidiaries operate 199 regional jets and 80 turboprops on more than 1,540 daily flights to 188 cities and towns in the United States, Canada, Mexico and Belize. Corporate offices are located in Memphis, Tenn., and hub operations are located at 11 major U.S. airports. The Company reported $8.81 million on $938.05 million of total operating revenue for the nine months ended Sept. 30, 2011, compared with net income of $17.02 million on $729.13 million of total operating revenue for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $1.53 billion in total assets, $1.42 billion in total liabilities and $112.31 million in total stockholders' equity. PONTIAC, MI: Fitch Affirms Rating on Two Revenue Bonds at Low-B --------------------------------------------------------------- Fitch Ratings takes the following rating action on Pontiac, MI (the city) as part of its continuous surveillance effort: -- Approximately $2 million water revenue bonds, series 1995 and 2002, affirmed at 'B-'; -- Approximately $3.3 million sewer revenue bonds, series 2002, affirmed at 'B-'. The Rating Outlook is revised to Positive from Stable. The water revenue bonds are secured by net revenues of the city's water system. The sewer revenue bonds are secured by net revenues of the city's sewer system. Financial performance in 2011 improved with water and sewer funds experiencing strong cash flow and coverage of existing debt obligations. Although management did not provides financial projections, cash flow and debt service coverage will likely decline as state loans repayments of approximately $12 million in new revolving fund loans begin in fiscal 2012. Fitch anticipates that debt service coverage should remain adequate with the additional savings expected from the United Water operating agreement. In Fitch's view, the credit quality of the water and sewer ratings is closely tied to the overall health of the city. In the past, the city has used funds from the water and sewer funds to provide cash flow relief to the general fund. While there are currently no outstanding loans due from the general fund to the two systems, the potential still exists. Ongoing discussions about a potential sale of excess wastewater treatment capacity contemplate potential use of the funds to benefit general fund operations. Although these discussions have been ongoing for years and remain tentative, it continues to reflect the collective approach to city financial operations that leads to the credit relationship. However, as the city's general financial position improves, there is less risk to the utility enterprise funds of the use of system revenues to support general government obligations. Further decoupling of the credit quality of the water and sewer systems from the general government will also include improved financial reporting and forecasting made available by management for the enterprise systems. Fitch expects these additional functions to develop as the city progresses towards overall financial health. Following multiple years of weak financial performance, the state appointed an EFM in March of 2009. The EFM is employed by the state to re-establish structural integrity and eliminate the city's overall accumulative deficit within five years with authority over labor negotiations, hiring, spending, and most other financial concerns. The third EFM is in place since 2009, creating some concern regarding turnover. Importantly, the EFM has unilateral control over rate setting for the utilities. Both the water and sewer funds experienced strong cash flow according to the 2011 audit. Each system achieved positive debt service coverage (over 7.0x for the water system and 3.0x for the sewer system) with sizable increases to their previously slim cash reserves. Water system cash reserves improved to over $5 million (234 days operating cash) and the sewer system cash reserves totaled $3.5 million (175 million days cash). However, coverage will decline as debt payments at each of the utilities increase with the additional loan repayments to the state beginning in fiscal 2012. Loan proceeds are needed to comply with regulatory requirements for both systems, certain of which were mandated by the state. In 2009, the city received authorization to borrow $5.5 million from the state drinking water revolving fund and $16 million from the state revolving fund for sewer fund improvements. Both loans allowed the city to take advantage of funds provided by the American Recovery and Reinvestment Act which provide 40% principal forgiveness on the loan amounts. Based on the city's estimated draw-down of loan funds, the first interest payments are due in fiscal 2012. As of July 1, 2011, United Water took over operations of the water and sewer systems under an operating agreement with the city. The city anticipates that United Water will be able to improve water losses and revenue collections as well as operate the systems for a savings of $2 million annually for both funds combined under a fixed price contract. Rates were increased 5% at the water system and 14% at the sewer system as of July 1, 2011 as well, although this reflects increasing water supply and treatment costs from Detroit, the city's wholesale water provider. Collection levels were only 84% based on information last provided to Fitch. Additional rate review is being conducted by United Water with consideration given to both operating and capital requirements and additional rate increases may be necessary within fiscal 2012. Collectively, both funds had around $8 million in customer receivables at the end of fiscal 2011, as compared to $22 million in annual revenues. However, a city ordinance was passed allowing for water service shut-off in the event of non-payment, which the city is hoping will both improve collections and reduce the uncollected amounts. Uncollected amounts after six months can be transferred to the county for collection on the property tax bill. POTOMAC SUPPLY: Files for Chapter 11 Due to Funding Woes -------------------------------------------------------- Kinsale, Virginia-based building-supply manufacturer Potomac Supply Corporation filed a Chapter 11 bankruptcy petition (Bankr. E.D. Va. Case No. 12-30347) on Jan. 20, 2012, in Richmond. The Debtor estimated assets and debts of $10 million to $50 million as of the Chapter 11. Potomac in mid-January announced that it is suspending manufacturing operations in Kinsale after its lender refused to provide financing without additional investment. Potomac said it will resume operations at the 168-employee plant if it obtains funding. Potomac, according to The Associated Press, shut its 57-employee sawmill in December after being hit by the recession. Founded in 1948, the Kinsale-based company has five manufacturing operations. POTOMAC SUPPLY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Potomac Supply Corporation 1398 Kinsale Road Kinsale, VA 22488 Bankruptcy Case No.: 12-30347 Chapter 11 Petition Date: January 20, 2012 Court: U.S. Bankruptcy Court Eastern District of Virginia (Richmond) Judge: Douglas O. Tice, Jr. Debtor's Counsel: Patrick J. Potter, Esq. PILLSBURY WINTHROP SHAW PITTMAN LLP 2300 N. Street N.W. Washington, DC 20037-1128 Tel: (202) 663-8000 E-mail: patrick.potter@pillsburylaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by William T. Carden, Jr., chief executive officer. Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Osmose Wood Preserving Co. Trade Debt $924,078 P.O. Drawer O 1016 Everee Inn Road Griffin, GA 30224 Flippo Lumber Corporation Trade Debt $549,830 P.O. Box 38 Doswell, VA 23047 Potomac Xpress, LLC Trade Debt $542,327 1398 Kinsale Road Kinsale, VA 22488 Marquette Transportation Trade Debt $437,381 P.O. Box 1450 Minneapolis, MN 55485 West Fraser Trade Debt $428,041 #501 858 Beatty Street Vancouver BC V6B 1C1 CA Arbortech Forest Products, Inc. Trade Debt $341,979 500 Dearing Avenue Blackstone, VA 23824 Weyerhaeuser ? Contract Loads Trade Debt $189,435 Potomac Bioenergy Solutions, LLC Trade Debt $180,000 Elliot Sawmilling Company, Inc. Trade Debt $171,504 True North Sales LLC Trade Debt $156,071 Chips, Inc. Trade Debt $144,836 Gypsum Express, Ltd. Trade Debt $135,911 Primary Packaging, Inc. Trade Debt $123,400 Chester Wood Products, LLC Trade Debt $117,046 Viance, LLC Trade Debt $70,351 Alvarez & Marsal, LLC Trade Debt $69,204 Ball Lumber Company, Inc. Trade Debt $68,541 Carter Machinery Company, Inc. Trade Debt $66,900 Motion Industries, Inc. Trade Debt $64,059 Amandus Kahl GmbH & Co. KG Trade Debt $59,283 PRIUM SPOKANE: Trustee Retracts Case Conversion, Dismissal Plea --------------------------------------------------------------- Robert D. Miller Jr., the U.S. Trustee for Region 18, notified the U.S. Bankruptcy Court for the Eastern District of Washington that it has withdrawn it request to dismiss or convert Prium Spokane Buildings, L.L.C.'s case to one under Chapter 7 of the Bankruptcy Code. As reported in the Troubled Company Reporter on Nov. 8, 2011, the Debtor asked the Court to deny the motion to dismiss or convert. The Debtor asserted that dismissal or conversion would not be in the best interests of creditors. Further, the time that has elapsed without filing a plan and disclosure statement was due to the size and complexity of the case, and the associated issues that Prium Spokane was attempting to resolve prior to submitting a plan. The U.S. Trustee is represented by: James D. Perkins, Esq. United States Dept. of Justice 920 West Riverside, Room 593 Spokane, WA 99201 Tel: (509) 353-2999 Fax: (509) 353-3124 About Prium Spokane Buildings, L.L.C. Bellevue, Washington-based Prium Spokane Buildings, L.L.C., filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wash. Case No. 10-06952) on Dec. 16, 2010. Davidson Backman Medeiros PLLC, represents the Debtor. Berreth, Lochmiller & Associates, PLLC, serves as accountants. The Debtor disclosed $17,042,743 in assets and $34,723,584 in liabilities as of the Chapter 11 filing. There was no creditors committee appointed in the case. PURE BEAUTY: Has Until May 1 to File Bankruptcy Plan ---------------------------------------------------- Judge Mary Walrath extended Pure Beauty Salons & Boutiques, Inc., et al.'s exclusive right to file a Chapter 11 plan through May 1, 2012. The Debtors' exclusive right to solicit votes on that plan is also extended through June 28, 2012. About Pure Beauty Pure Beauty Salons & Boutiques, Inc., and its affiliated company BeautyFirst Franchise Corp., operate a chain of hair care and beauty supply stores under the trade names Trade Secret, Beauty Express, BeautyFirst, PureBeauty, and Winston's Barber Shop. Pure Beauty Salons & Boutiques, Inc. operates and/or owns 436 stores and BeautyFirst Franchise Corp. has agreements with 13 franchisees that operate 22 BeautyFirst and 7 Trade Secret Stores. Pure Beauty Salons & Boutiques, Inc., is back in Chapter 11 after having been sold out of Chapter 11 last year. The prior case was dismissed after the sale was completed. The previous case was In re Trade Secret Inc., 10-12153, in the same court. Pure Beauty Salons filed for bankruptcy (Bankr. D. Del. Case No. 11-13159) on Oct. 4, 2011. Affiliate BeautyFirst Franchise Corp. filed a separate petition (Bankr. D. Del. Case No. 11-13160). Joseph M. Barry, Esq., Kenneth J. Enos, Esq., and Ryan M. Bartley, Esq., at at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' counsel. The Debtors' investment banker is SSG Capital Advisors' J. Scott Victor -- jsvictor@ssgca.com The Debtors' notice, claims solicitation, and balloting agent is Epiq Bankruptcy Solutions. In its schedules, Pure Beauty Salons disclosed $36,444,963 in assets and $55,215,590 in liabilities as of the Petition Date. In its schedules, BeautyFirst Franchise disclosed $1,716,985 in assets and $36,761,086 in liabilities as of the Petition Date. The Debtors owe $15 million to vendors and landlords. The petition was signed by Brian Luborsky, chief executive officer. Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed seven unsecured creditors to serve on the Official Committee of Unsecured Creditors of Pure Beauty Salons. Attorneys at Pachulski Stang Ziehl & Jones LLP represent the Committee. LM+Co serves as their financial advisor. Secured lender Regis Corp. is represented in the case by Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath Nauman & Tansey P.A., and Kathleen M. Miller, Esq., at Smith Katzenstein & Furlow LLP. RADIOSHACK CORP: Moody's Cuts Corp. Family Rating to 'Ba2' ---------------------------------------------------------- Moody's Investors Service downgraded RadioShack Corporation's ("RadioShack") corporate family and probability of default ratings to Ba2 from Ba1. In addition, the ratings for RadioShack's senior unsecured convertible notes and senior unsecured notes were also downgraded to Ba3 from Ba2. The ratings outlook remains negative. RadioShack's SGL-1 Speculative Grade Liquidity rating is affirmed. Mickey Chadha, Senior Analyst at Moody's said "We do not expect the negative trend in margins and credit metrics for RadioShack to reverse in the near to medium term due to the highly competitive environment in its mobility business, increasing promotional sales and the proliferation of lower margin smart phones". Chadha went on to say "Underpinning and providing support to the ratings is the company's very good liquidity". RATINGS RATIONALE Based on Moody's outlook that the operating income growth for the overall retail sector will be muted in 2012, the weak overall retail market trends in the fourth quarter of 2011 and the increasing price competition within the wireless mobility sector, Moody's believes that RadioShack's operating performance will continue to be weak. These ratings are downgraded and point estimates updated: Corporate Family Rating to Ba2 from Ba1 Probability of Default Rating to Ba2 from Ba1 $375 million 2.5% senior unsecured convertible notes due 2013 to Ba3 (LGD 4, 64%) from Ba2 (LGD 4, 64%) $325 million senior unsecured notes due 2019 TO Ba3 (LGD 4, 64%) from Ba2 (LGD 4, 64%) Senior unsecured shelf rating to (P) Ba3 from (P) Ba2 The negative outlook reflects Moody's opinion that the 2012 operating environment will remain challenging and that RadioShack's ongoing lackluster operating performance is resulting in margin erosion which will likely continue in the near to medium term. Pending maturity concerns are mitigated by Moody's expectation that the company's cash balance will be maintained at approximately current levels. Given the negative outlook, upward movement in RadioShack's ratings is unlikely in the near to medium term. Stabilization of the outlook could occur if operating margins reverse their declining trend, liquidity remains very good, debt/EBITDA is sustained below 4.25 times and EBITA to interest is sustained above 2.5 times. In the longer term a higher rating would likely require no deterioration in liquidity and improvements in operating performance, such that debt / EBITDA is sustained below 3.75 times and EBITA to interest is sustained above 3.5 times. Given that debt/EBITDA and EBITA/interest for the LTM period ended September 30, 2011 is at about 5.0 times and about 2.5 times respectively, ratings could be downgraded if there is no improvement in credit metrics in the near to medium term. Ratings could also be downgraded due to further increases in dividends or share buyback's and deterioration in liquidity. The principal methodology used in rating RadioShack was the Global Retail Industry 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. Please see ratings tab on the issuer/entity page on www.moodys.com for the last rating action and the rating history. The date on which some ratings were first released goes back to a time before Moody's ratings were fully digitized and accurate data may not be available. Consequently, Moody's provides a date that it believes is the most reliable and accurate based on the information that is available to it. RANCHO LAS FLORES: San Bernardino Land Owner Files for Chapter 11 ----------------------------------------------------------------- Dana Point, California-based Rancho Las Flores, LLC, filed a Chapter 11 petition (Bankr. C.D. Calif. Case No. 8:12-bk-10764-ES) on Jan. 19, 2012, in Santa Ana. The Debtor disclosed $168.3 million in assets and liabilities of $58.1 million in documents attached to the petition. The Donald W. Hutchings Living Trust owns 72% of the Debtor. Donald W. Hutchings, as president of Countryside Properties Inc., the manager of the Debtor, signed the Chapter 11 petition. The Debtor owns parcels of land identified as Rancho Las Flores in Hesperia, California (valued at $166.3 million); a 124-acre Weirick property in Hesperia ($570,000); the Afton Canyon Property in Baker, California ($70,400); and the Derkermus Property in San Bernardino County ($162,175). The Debtor has communications site license agreements for cell tower operations with AT&T Wireless and Southern California Edison Company. Income from business operations in 2010 was $1.29 million. Income rose to $2.68 million the next year. A $55.7 million claim by RE Loans LLC is secured by the Rancho Las Flores property. RE Loans LLC, which for many years was providing financing to home builders and developers of real property, had sought Chapter 11 protection with affiliates (Bankr. N.D. Tex. Case Nos. 11-35865, 11-35868 and 11-35869) on Sept. 13, 2011. Rancho Las Flores says that a motion for relief from stay has been filed in the RE Loans Chapter 11 case. RANCHO LAS FLORES: Case Summary & 6 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Rancho Las Flores, LLC, Debtor 33971 Selva Road, Suite 250 Dana Point, CA 92629 Bankruptcy Case No.: 12-10764 Chapter 11 Petition Date: January 19, 2012 Court: U.S. Bankruptcy Court Central District of California (Santa Ana) Judge: Erithe A. Smith Debtor's Counsel: Todd C. Ringstad, Esq. RINGSTAD & SANDERS LLP 2030 Main Street, #1200 Irvine, CA 92614 Tel: (949) 851-7450 E-mail: becky@ringstadlaw.com Scheduled Assets: $168,276,058 Scheduled Liabilities: $58,080,221 The petition was signed by Donald W. Hutchings, president of Countryside Properties, Inc., manager. Debtor's List of Its Six Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Niguel Shores LLC Lease $4,894 P.O. Box 1762 San Ramon, CA 94583 O?Neil LLP Trade Debt $1,415 1990 MacArthur Boulevard, Suite 1050 Irvine, CA 92612 Professional Archaeological Trade Debt $800 13730 Via Cima Bella San Diego, CA 92129 Staples Credit Plan Trade Debt $587 Law Offices of David L Colgan Attorney?s Fees $424 Xerox Corporation Equipment Fees $187 REALOGY CORP: Bank Debt Trades at 11% Off in Secondary Market ------------------------------------------------------------- Participations in a syndicated loan under which Realogy Corp. is a borrower traded in the secondary market at 89.46 cents-on-the- dollar during the week ended Friday, Jan. 20, 2012, an increase of 0.28 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 425 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 10, 2016, and carries Moody's B1 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Realogy Corp. Realogy Corp. -- http://www.realogy.com/-- a global provider of real estate and relocation services with a diversified business model that includes real estate franchising, brokerage, relocation and title services. Realogy's world-renowned brands and business units include Better Homes and Gardens Real Estate, CENTURY 21, Coldwell Banker, Coldwell Banker Commercial, The Corcoran Group, ERA, Sotheby's International Realty, NRT LLC, Cartus and Title Resource Group. Collectively, Realogy's franchise systems have around 15,000 offices and 270,000 sales associates doing business in 92 countries around the world. Headquartered in Parsippany, N.J., Realogy is owned by affiliates of Apollo Management, L.P., a leading private equity and capital markets investor. Realogy fully supports the principles of the Fair Housing Act. Realogy reported a net loss of $285 million on $3.16 billion of net revenues for the nine months ended Sept. 30, 2011, compared with a net loss of $7 million on $3.12 billion of net revenues for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $7.89 billion in total assets, $9.24 billion in total liabilities, and a $1.34 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. SAKS INC: Moody's Lifts Corporate Family Rating to 'Ba3' -------------------------------------------------------- Moody's Investors Service upgraded Saks Incorporated ratings including its Corporate Family Rating to Ba3 from B1. The rating outlook is stable. The upgrade reflects Saks' strong operating results and Moody's belief that Saks' growth in operating income is sustainable given the strength in the luxury sector. This results in Saks' being able to sustain EBITA margins above 4.5% and EBITA to interest expense above 2.25 times, a level that Moody's believes is more indicative of a Ba rating. These ratings are upgraded: Corporate Family Rating to Ba3 from B1 Probability of Default Rating to Ba3 from B1 Senior unsecured rating to B1 (LGD 5, 71%) from B2 (LGD 5, 75%) RATINGS RATIONALE "Saks reported very strong Holiday 2011 sales which bodes well for its 2011 earnings," stated Maggie Taylor a Senior Credit Officer with Moody's. "Its performance is likely to remain strong as the luxury sector is resilient to most of the economic pressures facing consumers," she added. Saks' Ba3 reflects its low level of funded debt which results in modest leverage, its very good liquidity, and its sizable portfolio of unencumbered real estate. The rating also acknowledges Saks' well recognized brand name and that the luxury goods market is somewhat immune to most pressures facing consumers, namely high unemployment and continued high gas prices. Thus, Moody's expects Saks to continue to perform well. The rating is constrained by Saks' relatively small scale with revenues of about $3.0 billion, its limited store base, and its geographic concentration in New York City which accounts for about 22% of its sales. The rating also considers that Saks' operating margin continues to lag its peers. In addition, Saks' history of erractic operating performance prior to the recession remains a rating concern. The stable outlook reflects the strength in Saks' debt protection measures and acknowledges the Euro area sovereign crisis. While the Euro area sovereign crisis could potentially impact tourism in New York City potentially hurting sales at Saks' flagship store and also result in continued stock market volatility, Moody's believes that the strength in Saks' debt protection measures and its very good liquidity provide it with a sizable cushion at the Ba3 rating level. An upgrade would require Saks' to continue to demonstrate consistently solid operating results and to improve EBIT margins such that they are closer to its industry peers and remain above 6.5%. A rating upgrade would also require Saks to maintain good liquidity along with debt to EBITDA below 3.5 times and EBITA to interest expense above 2.75 times. In addition, an upgrade would require Saks to maintain financial policies that would support this level of credit metrics. Ratings could be downgraded should operating performance falter or debt increase such that debt to EBITDA would rise above 4.5 times or EBITA to interest expense would fall below 2.25 times. The principal methodology used in rating Saks Incorporated was the Global Retail Industry 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. Saks Incorporated, headquartered in New York, NY, operates about 46 Saks Fifth Avenue Stores in 22 states and 60 OFF 5th off-price stores across the United States. Revenues are about $3.0 billion. SCHOMAC GROUP: Hearing on LNV Corp.'s Cash Continued Until Feb. 7 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona has continued until Feb. 7, 2012, at 10:00 a.m., the hearing to consider Schomac Group, Inc., and Tedco, Inc.'s request to use LNV Corp.'s cash collateral. The Court has also continued until Feb. 9, at 10:00 a.m., the hearing on NSS RV Central OG Limited Partnership's request to use BOKF, N.A.'s cash collateral. The Court previously authorized the Debtors to use the cash collateral to fund postpetition operations of their businesses. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the lender replacement liens in all property in the same kind and character as existed prepetition. About The Schomac Group & TEDCO Tucson, Arizona-based The Schomac Group, Inc., develops, constructs, manages, and invests in residential, industrial, and commercial real property. Tedco, Inc., invests in real property and in mortgages backed by real property. Schomac Group and Tedco filed for Chapter 11 bankruptcy (Bankr. D. Ariz. Case Nos. 11- 22717 and 11-22720) on Aug. 9, 2011. In its schedules, Schomac Group disclosed $48,929,897 in total assets and $34,583,005 in total liabilities. Judge Eileen W. Hollowell presides over the cases. Mesch, Clark & Rothschild, P.C., serves as the Debtors' counsel. Attorney for secured lender LNV Corp. is William Novotny, Esq., at Mariscal Weeks McIntyre & Friedlander, PA. SCHOMAC GROUP: Hearing on Plan Outline Adequacy Set for Feb. 7 -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona will convene a hearing on Feb. 7, 2012, at 10:00 a.m., to consider adequacy of the Disclosure Statement explaining The Schomac Group, Inc., et al.'s Chapter 11 Plan of Reorganization. As reported in the Troubled Company Reporter on Jan. 6, 2012, the Plan contemplates the continued operation of the business entities, including the marketing of properties, which will allow the Debtors to pay creditors. The Debtors' secured debt will be restructured in a manner where payment obligations do not outstrip the income from the project. The Plan will be funded by future operations of the Debtors' businesses, including the sale of properties, as well as by the dividend income from the Debtors' OP Units in CubeSmart. The Debtors also have commitments from related non-debtor entities and the individual equity-holder of the Debtors to fund plan payments, to the extent the Debtors' revenues are insufficient. The secured claim of LNV Corp. against both Schomac (Class 4) and TEDCO (Class 17) in the scheduled amount of $17,709,053 will be allowed in an amount determined by the Court, which the Debtor believes will not include penalties, late charges or default interest. Accrued interest and allowed fees and costs will be added to the principal amount of the claim. This claim will be paid over a period of 10 years. Interest only quarterly payments will be made for the first 36 months following the Effective Date. Allowed general unsecured creditors of Schomac will be paid an initial distribution equal to 10% of each Allowed Claim within 12 months after the Effective Date. Beginning on the second anniversary date of the Effective Date, each claimant will receive an annual distribution, equal to at least 10% of the Allowed Claim, plus accrued interest, until paid in full. Allowed general unsecured claims of TEDCO (Class 19), NSS RV (Class 26), and SRE (Class 32) will receive similar treatment. Schomac's equity holders (Class 19), TEDCO's equity holders (Class 20), NSS RV's Equity holders (Class 27), and SRE's equity holders (Class 33) will continue their ownership of the Debtors post- confirmation and management of the Debtors will remain the same. A copy of the Joint Disclosure Statement is available at no chrge at http://bankrupt.com/misc/schomac.doc96.pdf About The Schomac Group Tucson, Arizona-based The Schomac Group, Inc.'s primary business is to act as a holding company for its various subsidiaries, which are actively involved in diverse segments of the real estate industry. Schomac's sole shareholders are two trusts controlled by W. Michael Schoff. Schomac previously managed a portfolio of approximately 200 self-storage facilities, 72 of which were sponsored and managed by Schomac with TEDCO, Inc., being a substantial investor. Schomac also sponsored and managed a portfolio of apartment complexes, including the management of roughly 40 apartment complexes, as many as 16 of which were owned by Schomac over time. TEDCO's primary business is to act as a holding company for its various subsidiaries, which are actively involved in diverse segments of the real estate industry. TEDCO's sole shareholder is W. Michael Schoff. SRE Investments, LP owns eleven residential lots of roughly 5 acres each in Saguaro Ranch, a subdivision located in the Tortolita Mountains in Marana, Pima County, Arizona. SRE is 75.921% owed by Schomac. NSS RV Central Limited Partnership owns the real estate known as RV Central, a recreational vehicle and self storage facility located at 6260 North Travel Center Drive in Marana, Pima County, Arizona. NSS RV is 100% owned by Schomac. Schomac Group and TEDCO filed for Chapter 11 bankruptcy (Bankr. D. Ariz. Case Nos. 11-22717 and 11-22720) on Aug. 9, 2011. In its schedules, Schomac Group disclosed $48,929,897 in total assets and $34,583,005 in total liabilities. Judge Eileen W. Hollowell presides over the cases. NSS RV filed for Chapter 11 (Bankr. D. Ariz. Case No. 11-33246) on Dec. 6, 2011. In its petition, NSS RV estimated assets and debts of between $1 million and $10 million each. SRE Investments filed for Chapter 11 bankruptcy (Bankr. D. Ariz. Case No. 11-33247) on Dec. 6, 2011. In its schedules, SRE disclosed $10,148,424 in assets and $3,727,952 liabilities. Michael McGrath, Esq., and Frederick J. Petersen, Esq., at Mesch, Clark & Rothschild, P.C., in Tucson, Ariz. Represent the Debtors as counsel. The cases are being jointly administered under Case No. 11-22717. SEARS HOLDINGS: Talking to Factors; Ed Lampert Takeover Seen ------------------------------------------------------------ Karen Talley, writing for Dow Jones Newswires, reports that Sears Holdings Corp.'s shares jumped 13% on Friday -- shares rose $5.65 to $49 in 4 p.m. trading on the Nasdaq Stock Market -- amid expectations the department store retailer will be able to reassure its merchandise financiers that it has the wherewithal and the desire to meet its obligations. Dow Jones said there's talk that Sears could be taken over by its majority owner, hedge fund billionaire Edward Lampert. Any discussions couldn't be confirmed. Dow Jones also reports Sears on Friday was said to have talked with a number of its larger factors about a new financial approach after talking first with CIT Group Inc., a factor that pulled its funding amid uncertainties about Sears's financial condition. CIT was said to have reinstated its financing agreement. Dow Jones notes representatives from Sears declined to comment. A CIT spokesman said the company doesn't comment on customers. Factors are financing firms that buy receivables from suppliers and collect the money from retailers once the goods are sold. "Sears has come up with a financial vehicle to make factors more comfortable," said a person familiar with the arrangement, according to Dow Jones. "There is a lot of renewed confidence in their ability to satisfy their vendors." The executive declined to elaborate on the arrangement. Dow Jones also reports another person close to the matter said an arrangement has been "placed on the table" and it was likely it would soon be put into effect. Sears had tried to reassure suppliers it has adequate liquidity to operate its business, but that hasn't done much to allay financiers' fears, the sources said, according to Dow Jones. The factors were "worried about our financial exposure and that can't be satisfied by conversations about liquidity," said an executive at one New York-based factor, Dow Jones also reports. "We want shortened payment terms, more transparency into their finances, to know the value of their assets." About Sears Holdings Hoffman Estates, Illinois-based Sears Holdings Corporation (Nasdaq: SHLD) -- http://www.searsholdings.com/-- is the nation's fourth largest broadline retailer with more than 4,000 full-line and specialty retail stores in the United States and Canada. Sears Holdings operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a 94% stake in Sears Canada and an 80.1% stake in Orchard Supply Hardware. Key proprietary brands include Kenmore, Craftsman and DieHard, and a broad apparel offering, including such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer, as well as the Apostrophe and Covington brands. It also has the Country Living collection, which is offered by Sears and Kmart. Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6, 2003, pursuant to the terms of an Amended Joint Plan of Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represented the retailer in its restructuring efforts. The Company's balance sheet showed $16,287,000,000 in assets and $10,348,000,000 in debts when it sought chapter 11 protection. Kmart bought Sears, Roebuck & Co., for $11 billion to create the third-largest U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in annual revenues. Kmart completed its merger with Sears on March 24, 2005. Negative Outlook Standard & Poor's Ratings Services in January 2012 lowered its corporate credit rating on Hoffman Estates, Ill.-based Sears Holdings Corp. to 'CCC+' from 'B'. "We removed the rating from CreditWatch, where we had placed it with negative implications on Dec. 28, 2011. We are also lowering the short-term and commercial paper rating to 'C' from 'B-2'. The rating outlook is negative," S&P said. "The corporate credit rating reflects our projection that Sears' EBITDA will be negative in 2012, given our expectations for continued sales and margin pressure," said Standard & Poor's credit analyst Ana Lai. She added, "We further expect that liquidity could be constrained in 2013 absent a turnaround or substantial asset sales to fund operating losses." Moody's Investors Service in January 2012 lowered Sears Holdings Family and Probability of Default Ratings to B3 from B1. The outlook remains negative. At the same time Moody's affirmed Sears' Speculative Grade Liquidity Rating at SGL-2. The rating action reflects Moody's expectations that Sears will report a significant operating loss in fiscal 2011. Moody's added that the rating action also reflects the company's persistent negative trends in sales, which continue to significantly underperform peers. SEQUENOM INC: Selling 13 Million Common Shares at $4.15 Apiece -------------------------------------------------------------- Sequenom, Inc., announced the pricing of an underwritten public offering of 13,000,000 shares of its common stock, offered at a price to the public of $4.15 per share. The gross proceeds to Sequenom from this offering are expected to be $53.95 million, before deducting underwriting discounts and commissions and other estimated offering expenses payable by Sequenom. Sequenom has granted the underwriters a 30-day option to purchase up to an aggregate of 1,950,000 additional shares of common stock to cover over-allotments, if any. The offering is expected to close on or about Jan. 25, 2012, subject to customary closing conditions. Sequenom anticipates using the net proceeds from the offering for general corporate purposes, including research and development expenses, capital expenditures, working capital and general administrative expenses. Jefferies & Company, Inc., is acting as sole book-running manager for the offering, and Oppenheimer & Co. Inc. and William Blair & Company, L.L.C., are acting as co-managers for the offering. The securities described above are being offered by Sequenom pursuant to a shelf registration statement previously filed with the Securities and Exchange Commission, which the SEC declared effective on Dec. 21, 2011. A preliminary prospectus supplement related to the offering has been filed with the SEC and is available on the SEC's Web site located at http://www.sec.gov. Copies of the final prospectus supplement and the accompanying prospectus relating to this offering, when available, may be obtained from Jefferies & Company, Inc., Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, 12th floor, New York, NY 10022, or by telephone at 877-547-6340, or by email at Prospectus_Department@Jefferies.com. About Sequenom Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a life sciences company committed to improving healthcare through revolutionary genetic analysis solutions. Sequenom develops innovative technology, products and diagnostic tests that target and serve discovery and clinical research, and molecular diagnostics markets. The company was founded in 1994 and is headquartered in San Diego, California. Sequenom reported a net loss of $120.85 million on $47.45 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $71.01 million on $37.86 million of total revenue during the prior year. The Company also reported a net loss of $51.98 million on $40.42 million of total revenues for the nine months ended Sept. 30, 2011, compared with a net loss of $98.82 million on $33.70 million of total revenues for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $152.99 million in total assets, $42.13 million in total liabilities and $110.85 million in total stockholders' equity. Ernst & Young LLP of San Diego, California, in its audit report attached to the 2010 financial statements, did not include a going concern qualification for Sequenom. E&Y, in its report on the 2009 results, expressed substantial doubt against Sequenom's ability as a going concern, noting that the Company "has incurred recurring operating losses and does not have sufficient working capital to fund operations through 2010." SHOPPES OF LAKESIDE: March 9 Hearing on Dismissal Motion Set ------------------------------------------------------------ The U.S. Bankruptcy Court for the Middle District of Florida has scheduled a final evidentiary hearing on J Properties IV, LLC's motion to dismiss Shoppes of Lakeside, Inc.'s Chapter 11 case for March 9, 2012, at 9:30 a.m. As reported in the TCR on Dec. 22, 2011, Secured Creditor J Properties IV, LLC, told the Bankruptcy Court that the Debtor's Chapter 11 case should be dismissed as a bad faith filing. J Properties told the Court that, among others, the two Chapter 11 plans (Dec. 31, 2010, and April 20, 2011) proposed by the Debtor both allow the Debtor to stave off secured creditors for seven years with only minimal payments. Both plans also provide for an improper release of Mr. Hionides' guarantee liabilities as to those same creditors. About Shoppes of Lakeside Inc. Neptune Beach, Florida-based Shoppes of Lakeside, Inc., holds title to and generates income from residential and commercial buildings and unimproved land in Duval County. The Debtor owns 45 commercial properties and 10 residential properties. The Debtor filed for Chapter 11 bankruptcy protection on June 15, 2010 (Bankr. M.D. Fla. Case No. 10-05199). Taylor J. King, Esq., at the Law Offices of Mickler & Mickler, in Jacksonville, Fla., represents the Debtor as counsel. The Company disclosed $39,894,050 in assets and $37,748,101 in liabilities. As reported in the Troubled Company Reporter on Sept. 21, 2011, the Debtor disclosed $39,128,747 in assets and $37,748,101 in liabilities. SHOPPES OF LAKESIDE: Will Seek Plan Approval at March 21 Hearing ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida has approved the adequacy of the information of the disclosure statement filed by Shoppes of Lakeside, Inc., on April 20, 2011, and the addendum filed on Oct. 20, 2011. The Court established March 7, 2012, as the deadline for filing written acceptances or rejection of the Plan. The Court set a March 21, 2012 hearing date to consider the confirmation of the Debtor's Plan. Objections to confirmation, if any, must be filed and served 7 days before the date set for the confirmation hearing. Pursuant to the Plan terms, general unsecured claims will be paid 100% distribution, together with 5% interest, over 84 months. With respect to the one shareholder who owns 100% equity interest in the Debtor, no distribution will be made until all prior classes are paid in full. Payments and distributions under the Plan will be funded by: Lease and/or sale of commercial real property and capital contributions of Chris Hionides, the President, Vice President, Secretary and Treasurer of the Debtor. Numerous real properties owned by the Debtor are unencumbered or have minimal debt. Debtor anticipates sale of such properties over the life of the Plan to fund Plan payments, in addition to rental income. A copy of the Disclosure Statement filed April 20, 2011, is available for free at: http://bankrupt.com/misc/shoppesoflakeside.doc329.pdf A copy of the Addendum to Debtor's Amended Disclosure Statement is available for free at: http://bankrupt.com/misc/shoppesoflakeside.doc390.pdf About Shoppes of Lakeside Inc. Neptune Beach, Florida-based Shoppes of Lakeside, Inc., holds title to and generates income from residential and commercial buildings and unimproved land in Duval County. The Debtor owns 45 commercial properties and 10 residential properties. The Debtor filed for Chapter 11 bankruptcy protection on June 15, 2010 (Bankr. M.D. Fla. Case No. 10-05199). Taylor J. King, Esq., at the Law Offices of Mickler & Mickler, in Jacksonville, Fla., represents the Debtor as counsel. The Company disclosed $39,894,050 in assets and $37,748,101 in liabilities. As reported in the Troubled Company Reporter on Sept. 21, 2011, the Debtor disclosed $39,128,747 in assets and $37,748,101 in liabilities. SIGNAL HILL: Court Converts Chapter 11 Case to One Under Chapter 7 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Western District of Virginia has entered an order converting Signal Hill Crossroads, LLC's Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. In his motion for the conversion of the Debtor's case, filed Oct. 14, 2011, W. Clarkson McDow, Jr., United States Trustee for the Western District of Virginia, cited that the Debtor has failed to file monthly operating reports for the months of May, June, July and August 2011, and to pay quarterly fees for the 2nd quarter of 2011. Furthermore, the U.S. Trustee said that the Debtor has failed to confirm a plan of reorganization. The Debtor withdrew its plan and disclosure statement after relief from the automatic stay was granted to one of the Debtor's secured lenders. Vienna, Virginia-based Signal Hill Crossroads, LLC, filed for Chapter 11 bankruptcy protection (Bankr. Case W.D. Va. No. 11- 60365) on Feb. 14, 2011. Douglas E. Little, Esq., at Douglas E. Little, Attorney At Law, in Charlottesville, Va., serves at the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. SILVERSUN TECHNOLOGIES: Inks Exchange Pact with SWK Shareholders ---------------------------------------------------------------- SilverSun Technologies, Inc., entered into a share exchange agreement with certain shareholders of SWK Technologies, Inc., a subsidiary of the Company. Pursuant to the terms of the Agreement, the SWK Shareholders exchanged an aggregate of 25 shares of SWK to the Company for a total of 22,664,678 shares of the Company's common stock. Upon consummation of the Exchange, SWK became a wholly-owned subsidiary of the Company. The Company issued the Exchange Shares in reliance on an exemption from the registration requirements of the Securities Act of 1933, as amended for the private placement of our securities pursuant to Section 4(2) of the Act and/or Rule 506 of Regulation D promulgated thereunder. The transaction does not involve a public offering, the SWK Shareholders are "accredited investors" and they have access to information about the Company and their investment. A full-text copy of the Share Exchange Agreement is available for free at http://is.gd/CTpht5 About SilverSun Livingston, N.J.-based SilverSun Technologies, Inc., formerly known as Trey Resources, Inc., focuses on the business software and information technology consulting market, and is looking to acquire other companies in this industry. SWK Technologies, Inc., the Company's subsidiary and the surviving company from the acquisition and merger with SWK, Inc., is a New Jersey-based information technology company, value added reseller, and master developer of licensed accounting and financial software published by Sage Software. SWK Technologies also publishes its own proprietary supply-chain software, the Electronic Data Interchange (EDI) solution "MAPADOC." SWK Technologies sells services and products to various end users, manufacturers, wholesalers and distribution industry clients located throughout the United States, along with network services provided by the Company. As reported in the TCR on April 2, 2011, Friedman LLP, in East Hanover, NJ, expressed substantial doubt about Trey Resources, Inc.'s ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred substantial accumulated deficits and operating losses, and at Dec. 31, 2010, has a working capital deficiency of approximately $5.1 million. The Company's balance sheet at Sept. 30, 2011, showed $2.11 million in total assets, $2.89 million in total liabilities, all current, and a $783,533 total stockholders' deficit. SOUTH OF THE STADIUM: Providence Asks Court to Deny Confirmation ---------------------------------------------------------------- On Dec. 27, 2011, Providence Bank, as successor in interest to Premier Bank, filed its objection to the First Amended Plan of Reorganization of South of Stadium I, LLC, citing that because the Plan does not meet the requirements of Bankruptcy Code Section 1129, the Court must deny confirmation. Providence filed the following arguments in support of its objection to plan confirmation: 1. The Plan is not confirmable in that it was clearly not proposed in good faith. Good faith requires that the Debtor propose a plan with a reasonable expectation that reorganization can be accomplished. 2. The Planis not fair and equitable. In order for a plan to be confirmed over the objection of an impaired secured creditor, it must not discriminate unfairly and must be fair and equitable with respect to the secured claim. 11 U.S.C. Section 1129(b)(1). 3. The Plan violates the absolute priority rule. The Plan provides that unsecured creditors, whose interests would be junior to the claim of Providence, and all other classes of creditors, receive a cash distribution. For this to be allowable, the Plan must provide that each impaired non-accepting class of creditors receive value equal to the full amount of its claims before any class whose claims or interests are junior to that class receive anything. 4. The Plan is not feasible. The Debtor's assets are completely insufficient to fund the Plan. There are over $15,000,000 in secured claims against the Debtor's sole asset, the approximately 28.5 acres of undeveloped real property. The Debtors appraisal shows this asset to be worth $14,900,000, a figure which Providence disputes and believes is substantially overstated. Even if the Court accepts the Debtor's appraisal, there is no means of the Debtor paying the claims as set forth in the Plan. 5. The Plan may prejudice Providence's rights against third parties who guaranteed the debt, which would constitute an improper third party release. 6. The Plan is not confirmable in that it sets forth no time frame within which the Debtor will pay Class 5 claims, and does not provide interest to Class 5 claims during such time as they remain unpaid. 7. The Plan does not provide Providence its cash collateral and apparently uses Providence's cash collateral to pay Administrative Claims, Priority Tax Claims, General Unsecured Claims, and U.S. Trustee Fees. 8. The Plan does not make the disclosures required by Bankruptcy Code Section 1129(a)(5). 9. The Plan does not provide adequate means for implementation under Section 1123(a)(5). The Debtor has no means to pay all claims in full, because the value of the claims against the Debtor far outstrip its assets. 10. The Plan unfairly discriminates against Providence. As reported in the TCR on Dec. 5, 2011, the U.S. Bankruptcy Court for the Northern District of Texas, on Nov. 21, 2011, approved the first amended disclosure statement in support of the first amended plan of reorganization filed by South of the Stadium I, LLC, dated Nov. 16, 2011. Under the Plan, the Providence Property will be transferred to the Class 3 Claimant in full and final satisfaction of any and all amounts owed to the Class 3 Claimant. If the Class 3 Claimant disputes that the value of the property transferred to the Class 3 Claimant is equal to or greater than the Allowed Claim of the Class 3 Claimant, the Bankruptcy Court will conduct a hearing and determine the value of the property transferred to the Class 3 Claimant. The Class 3 Providence Bank Secured Claim will be allowed in the amount of $9,859,210 plus accrued but unpaid interest, fees, costs and expenses. At this time, Providence has filed a proof of claim asserting a secured claim in the amount of $10,921,062 as of the Petition Date, and has asserted rights under 11 U.S.C. Section 506(b) to post-petition interest at the rate of 11.5% per annum and attorneys' fees. The Class 4 Claim of One Prime will be allowed in the amount of $4,713,855 plus accrued but unpaid interest, fees, costs and expenses. The Class 4 Claimant will release any and all claims against the Providence Property on the date of transfer of the Providence Property under Section 5.03 of the Plan. The Class 4 Claimant will receive no property of any kind in consideration of the claims of the Class 4 Claimant against SOS. SOS owes $772,718 in unsecured claims (Class 5) of which $700,000 is owed to One Windsor Hill, LP, an insider or affiliate of SOS, and approximately $60,000 is owed to IntegraTax, Inc., for service provided in challenging and reducing property taxes assessed against the real property owned by SOS. Each Holder of an Allowed Class 5 General Unsecured Claim will receive a pro rata share of $10,000 cash within 30 days of the Effective Date of the Plan. The cash will be contributed by the sole member of SOS, MMM Ventures, LLC. Class 6 Interests in the Debtor will be extinguished on the Effective Date. Class 6 is impaired under the Plan. Each Holder of a Class 6 Interest is entitled to vote to accept or reject the Plan. A copy of the First Amended Disclosure statement with respect to the Debtor's First Amended Plan of Reorganization is available for free at http://bankrupt.com/misc/southofthestadium.dkt38.pdf Counsel for Providence Bank may be reached at: J. Seth Moore, Esq. Craig B. Anderson, Esq. DLA PIPER LLP (US) 1717 Main Street, Suite 4600 Dallas, TX 75201 Tel: (214) 743-4572 Fax: (972) 813-6267 E-mail: seth.moore@dlapiper.com craig.anderson@dlapiper.com About South of the Stadium I, LLC South of the Stadium I, LLC, in Carrollton, Texas, is a Texas limited liability company formed on April 18, 2007, for the purpose of acquiring and developing real property located in Tarrant County, Texas. MMM Ventures, LLC, a Texas limited liability company is the sole member of SOS. The single asset of SOS is 28.53 acres of undeveloped land located south of the Dallas Cowboys' stadium in Arlington, Texas. The Debtor filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 11-43278) on June 6, 2011. Debtor-affiliates 261 CW Springs LTD (Bankr. N.D. Tex. Case No. 1-33757), WS Minerals LLC (Bankr. N.D. Tex. Case No. 11-43273), and WS Mineral Holdings LLC (Bankr. N.D. Tex. Case No. 11-43290) also filed on the same day. Judge D. Michael Lynn presides over the cases. Richard W. Ward, Esq. -- rwward@airmail.net -- Plano, Texas, serves as the Debtors' bankruptcy counsel. South of the Stadium I, WS Minerals LLC, and WS Mineral Holdings LLC each estimated assets and debts of $10 million to $50 million in their petitions. 261 CW Springs estimated assets and debts of $1 million to $10 million in its petition. The petitions were signed by Jeff Shirley, authorized representative. SOUTHERN MONTANA: Hearing on Access to Lender's Cash Set for Today ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Montana will convene a hearing on Jan. 24, 2012, at 10:00 a.m., to consider Southern Montana Electric, Generation and Transmission Cooperative, Inc.'s request to use the cash collateral. The Court, in a second interim order, approved the stipulation entered among Lee Freeman, the Chapter 11 trustee for the Debtor, and the prepetition secured parties. As of the Petition Date, the Debtor was liable to the prepetition secured parties in respect of obligations under the indenture for (i) the aggregate principal amount of not less than $85 million on account of the notes issued under the indenture; and (ii) unpaid fees, expenses, disbursements, indemnifications, obligations, and charges or claims. The trustee would use the cash collateral to finance the operation of the business until Jan. 24. As adequate protection from diminution in value of the lenders' collateral, the Debtor will grant the prepetition secured parties replacement liens on all collateral, and a superpriority administrative expense claim status, subject to carve out. About Southern Montana Electric Based in Billings, Montana, Southern Montana Electric Generation and Transmission Cooperative, Inc., was formed to serve five other electric cooperatives. The city of Great Falls later joined as the sixth member. Including the city, the co-op serves a population of 122,000. In addition to Great Falls, the service area includes suburbs of Billings, Montana. Southern Montana filed for Chapter 11 bankruptcy (Bankr. D. Mont. Case No. 11-62031) on Oct. 21, 2011. Southern Montana estimated assets of $100 million to $500 million and estimated debts of $100 million to $500 million. Timothy Gregori signed the petition as general manager. Jon E. Doak, Esq., at Doak & Associates, P.C., in Billings, Montana, serves as the Debtor's counsel. In December 2011, Southern Montana also sought permission to employ the Goodrich Law Firm, P.C., as general co-counsel. Also in December, Lee A. Freeman was appointed as Chapter 11 trustee. Mr. Freeman retained Horowitz & Burnett, P.C., as his counsel and Waller & Womack, P.C., as local counsel. The United States Trustee for Region 18 has appointed an Official Committee of Unsecured Creditors in the case. Standard & Poor's Ratings Services in October lowered its issuer credit rating on SME to 'CC' from 'BBB', and placed the rating on CreditWatch with developing implications. These actions follow the cooperative's Oct. 21 bankruptcy filing under Chapter 11 of the U.S. Bankruptcy Code. According to SME, the filing was in response to failure on the part of some of its members to honor contractual obligations, including payment to the cooperative for services. SP NEWSPRINT: Court OKs Ashby & Geddes as Comm. Local Counsel ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized the Official Committee of Unsecured Creditors of SP Newsprint Holdings LLC, et al., to retain Ashby & Geddes, P.A., as its Delaware counsel. The principal attorneys and paralegals presently designated to represent the Committee and their current hourly rates are: Professional Position Hourly Rate ------------ -------- ----------- William P. Bowden Member $640 Karen B. Skomorucha Associate $385 Stacy L. Newman Associate $315 Chris Warwick Paralegal $185 About SP Newsprint Greenwich, Conn.-based SP Newsprint Holdings LLC -- aka Bulldog Acquisition I LLC, Bulldog Acquisition II LLC, Publishers Papers, Southeastern Paper Recycling and SP Newsprint Merger LLC -- and three affiliates, SP Newsprint Co. LLC, SP Recycling Corporation and SEP Technologies L.L.C, filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-13649) on Nov. 15, 2011. SP Newsprint Holdings LLC is a newsprint company controlled by polo-playing mogul Peter Brant. It is one of the largest producers of newsprint in North America. SP Recycling Corporation, a Georgia corporation and the Debtors' other operating company, was established in 1980 as a means for SP to secure a ready supply of recycled fiber, a key raw material for its newsprint. SP Newsprint is the second Brant-owned newsprint company to tumble into bankruptcy proceedings in recent years. Current and former affiliated entities are Bear Island Paper Company, L.L.C., Brant Industries, Inc., F.F. Soucy, Inc., Soucy Partners Newsprint, Inc., White Birch Paper Company. Judge Christopher S. Sontchi presides over the case. Joel H. Levitin, Esq., Maya Peleg, Esq., and Richard A. Stieglitz Jr., Esq., at Cahill Gordon & Reindel LLP serve as the Debtors' lead counsel. Lee E. Kaufman, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as the Debtors' Delaware counsel. AlixPartners LLP serves as the Debtors' financial advisors and The Garden City Group Inc. serves as the Debtors' claims and noticing agent. In its petition, SP Newsprint Holdings estimated $100 million to $500 million in assets and debts. The petitions were signed by Edward D. Sherrick, executive vice president and chief financial officer. An official committee of unsecured creditors appointed in the case tapped BDO Consulting as financial advisor; and Lowenstein Sandler PC and Ashby & Geddes as counsel. SP NEWSPRINT: Court OKs BDO as Committee's Financial Advisor ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized the Official Committee of Unsecured Creditors of SP Newsprint Holdings LLC, et al., to retain BDO Consulting as its financial advisor. BDO will seek payment for compensation of professional services on a fixed monthly basis of $75,000 per month for the first three months and $50,000 per month thereafter, plus reimbursement of actual and necessary expenses. About SP Newsprint Greenwich, Conn.-based SP Newsprint Holdings LLC -- aka Bulldog Acquisition I LLC, Bulldog Acquisition II LLC, Publishers Papers, Southeastern Paper Recycling and SP Newsprint Merger LLC -- and three affiliates, SP Newsprint Co. LLC, SP Recycling Corporation and SEP Technologies L.L.C, filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-13649) on Nov. 15, 2011. SP Newsprint Holdings LLC is a newsprint company controlled by polo-playing mogul Peter Brant. It is one of the largest producers of newsprint in North America. SP Recycling Corporation, a Georgia corporation and the Debtors' other operating company, was established in 1980 as a means for SP to secure a ready supply of recycled fiber, a key raw material for its newsprint. SP Newsprint is the second Brant-owned newsprint company to tumble into bankruptcy proceedings in recent years. Current and former affiliated entities are Bear Island Paper Company, L.L.C., Brant Industries, Inc., F.F. Soucy, Inc., Soucy Partners Newsprint, Inc., White Birch Paper Company. Judge Christopher S. Sontchi presides over the case. Joel H. Levitin, Esq., Maya Peleg, Esq., and Richard A. Stieglitz Jr., Esq., at Cahill Gordon & Reindel LLP serve as the Debtors' lead counsel. Lee E. Kaufman, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as the Debtors' Delaware counsel. AlixPartners LLP serves as the Debtors' financial advisors and The Garden City Group Inc. serves as the Debtors' claims and noticing agent. In its petition, SP Newsprint Holdings estimated $100 million to $500 million in assets and debts. The petitions were signed by Edward D. Sherrick, executive vice president and chief financial officer. An official committee of unsecured creditors appointed in the case tapped BDO Consulting as financial advisor; and Lowenstein Sandler PC and Ashby & Geddes as counsel. SPECTRAWATT INC: Will Seek Approval of Plan at Jan. 25 Hearing -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York approved on Dec. 19, 2011, the adequacy of the information of the First Amended Disclosure Statement filed in SpectraWatt Inc.'s Chapter 11 case. The hearing to consider the confirmation of the Plan is scheduled for Jan. 25, 2012, at 10:00 a.m. Washington County, Oregon, which holds pre-petition secured claims against the Debtor for unpaid property taxes totaling $45,642 plus accruing interest, has objected to the proposed plan of liquidation. The County tells the Court that the Debtor sold its Oregon assets without its knowledge or consent and failed to remit the sale proceeds, to which the County's lien automatically attached, to the County. The County thus seeks entry of an order denying confirmation of the proposed Plan, unless the Plan is amended to provide for the full payment of the Oregon Tax Claims upon confirmation. As reported in the TCR on Jan. 6, 2012, SpectraWatt Inc. filed a First Amended Disclosure Statement in connection with the Debtor's Chapter 11 Plan of Liquidation, dated Dec. 5, 2011. The Plan contemplates the transfer of all of the Debtor's assets into a Liquidating Trust for distribution to holders of Allowed Claims by the Liquidating Trustee. The Liquidating Trustee will be tasked with the winding down of the Debtor's Estate and the resolution of the outstanding Claims against the Debtor. The Classes of Claims and Interests and their treatment are: A. Class 1 - Allowed Series A-1 Noteholder Secured Claims Estimated Allowed Claims: $41,159,724 Estimated Recovery: 11.8% B. Class 2 - Allowed Crystalox Secured Claim Estimated Allowed Claims: $0 Estimated Recovery: 0% C. Class 3 - Allowed SUMCO Secured Claim Estimated Allowed Claims: Unknown (disputed) Estimated Recovery: 100% of any Allowed claim up to the amount of the SUMCO Prepayment D. Class 4 - Allowed Other Secured Claims Estimated Allowed Claims: $0 Estimated Recovery: 100% of any Allowed Claims E. Class 5 - Allowed Priority Non-Tax Claims Estimated Allowed Claims: $0 Estimated Recovery: 100% of any Allowed Claims F. Class 6 - Allowed General Unsecured Trade Claims Estimated Allowed Claims: $775,000-$2,300,000 Estimated Recovery if Class 6 votes to accept Plan: Range between 11.4% to 11.8% Estimated Recovery if Class 6 votes not to accept Plan: 0% G. Class 7 - Allowed Series A-1 Noteholder Deficiency Claims Estimated Allowed Claims: $36,305,535 Estimated Recovery: 0% H. Class 8 - Allowed Interests Estimated Allowed Interests: $50,000,000 Estimated Recovery: 0% The treatment of Unclassified Claims are: A. Estimated Allowed Administrative Expense Claims other than Professional Fee Claims: $30,000 Estimated Recovery: 100% B. Estimated Allowed Priority Tax Claims: $350,000 Estimated Recovery: 100% A copy of the First Amended Disclosure Statement is available for free at: http://bankrupt.com/misc/SPECTRAWATT_ds_firstamended.pdf About SpectraWatt Inc. Based in Hopewell Junction, New York, SpectraWatt Inc. was spun off from Intel in June 2008 and raised $50 million through a sale of preferred stock to its former parent and other investors including Goldman Sachs Group Inc.'s Cogentrix Energy LLC, PCG Clean Energy and Berlin-based solar panel maker Solon SE. The Company has also issued about $36.7 million in senior secured convertible notes. The Company's manufacturing facility in Hopewell Junction is designed to generate over 200 megawatts of production per year. The plant began operations in January 2010 with an initial capacity of only 30 megawatts per year. The Company began winding down its affairs late last year after encountering setbacks and shut down the lone manufacturing facility in March, and fired all its workers. SpectraWatt filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 11-37366) on Aug. 19, 2011, in Poughkeepsie, New York. SpectraWatt estimated as much as $50 million in both debt and assets as of the Chapter 11 filing. Mark W. Wege, Esq., and Eric M. English, Esq., at King & Spalding LLP, in Houston, Texas, and Scott I. Davidson, Esq., at King & Spalding LLP, in New York, represent the Debtor as counsel. SQUARETWO FINANCIAL: Moody's Affirms Corp. Family Rating at 'B2' ---------------------------------------------------------------- Moody's Investors Service affirmed SquareTwo Financial Corporation's Corporate Family and Senior Secured Second Lien Notes ratings of B2. The outlook for the ratings is stable. RATINGS RATIONALE SquareTwo's ratings incorporate several credit weaknesses including the Company's monoline focus on charged-off consumer debt collections, its relatively weak financial position, dependence on secured funding and vulnerability to model risk in cash flow forecasting and portfolio valuation. However, Moody's recognizes improvement in profitability and debt coverage trends as well as notes the Company's extensive track record in the fragmented charged-off credit card collections industry. The Company's relatively high leverage and significant negative tangible net worth, as well as high level of asset encumbrance, constrain SquareTwo's operating and financial flexibility. Moody's believes that companies in the debt collection industry need a substantial capital cushion in order to absorb potential financial stresses. At the same time, Moody's notes the Company's satisfactory debt maturity profile with no substantial debt maturities until 2014, which mitigates near-term liquidity-related risks. In addition, significant private equity ownership of SquareTwo creates uncertainty regarding the method and timing of KRG's investment exit. The rating for the Senior Notes is the same as the Corporate Family Rating, reflecting the Senior Notes' preponderance in the Company's debt structure. However, Moody's notes that over the past 12 months the Company has increased the Senior First Lien Revolving Credit Facility, which has repayment superiority over the Senior Notes, as a percentage of total debt. Further material changes in the capital structure may affect rated debt notching. The rating outlook is stable, reflecting Moody's expectations that the Company will continue to exhibit satisfactory performance. The principal methodology used in this rating was Analyzing the Credit Risks of Finance Companies published in October 2000. SquareTwo is a purchaser of charged off credit card and other consumer debt receivables which pursues collections via a network of franchises. The Company is headquartered in Denver, CO. STONER AND CO: Sec. 341 Creditors' Meeting Set for Feb. 16 ---------------------------------------------------------- The United States Trustee will hold a meeting of creditors pursuant to 11 U.S.C. Sec. 341(a) in the Chapter 11 case of Stoner and Company on Feb. 16, 2012, at 9:30 a.m. at UST Conference Room (New). Stoner and Company, in Fort Collins, Colorado, filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 12-10429) on Jan. 11, 2012. Judge Elizabeth E. Brown presides over the case. Daniel W. Alexander, Esq., serves as the Debtor's counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $100,001 to $500,000 in debts. The petition was signed by Jay D. Stoner, president. STONER AND CO: Chapter 11 Case Conference Set for Feb. 16 --------------------------------------------------------- The Bankruptcy Court set a Chapter 11 Scheduling Conference for Feb. 16, 2012, at 11:00 a.m. BRCH Courtroom C501 for 1. The Debtor faces a Feb. 25 deadline to file schedules of assets and liabilities and statement of financial affairs. Stoner and Company, in Fort Collins, Colorado, filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 12-10429) on Jan. 11, 2012. Judge Elizabeth E. Brown presides over the case. Daniel W. Alexander, Esq., serves as the Debtor's counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and $100,001 to $500,000 in debts. The petition was signed by Jay D. Stoner, president. SUMMO INC: Creditors Have Until Feb. 6 to File Proofs of Claims --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Colorado has established Feb. 6, 2012, as the deadline for any individual or entity to file proofs of claim against Summo Inc. Pueblo, Colorado-based Summo, Inc., fka Pinion Ridge, LLC, filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 11-28971) on Aug. 9, 2011. Judge Elizabeth E. Brown presides over the case. Daniel K. Usiak, Jr., Esq., at Usiak Law Firm, in Colorado Springs, Colo., serves as the Debtor's bankruptcy counsel. The Debtor scheduled $15,845,500 in assets and $4,809,760 in debts. The petition was signed by John C. Musso, the president and sole equity owner of the Debtor. A creditors committee has not been appointed in the bankruptcy case. SUPERMEDIA INC: Files Q4 Post-Confirmation Quarterly Report ----------------------------------------------------------- On Jan. 20, 2012, SuperMedia Inc., et al., filed their unaudited consolidated Post-Confirmation Quarterly Operating Report for the quarter ending Dec. 31, 2011, with the Office of the United States Trustee for the Northern District of Texas, Dallas Division. SuperMedia Inc., et al., submitted their schedules of cash receipts and disbursements for the quarter. SuperMedia Inc. disclosed: Cash, Beginning $0 Cash Receipts $32,620,000 Cash Disbursements $32,620,000 Cash, End $0 SuperMedia LLC disclosed: Cash, Beginning $267,355,000 Cash Receipts $310,563,000 Cash Disbursements $488,349,000 Cash, End $89,569,000 SuperMedia Services ? West Inc. disclosed: Cash, Beginning $0 Cash Receipts $15,680,000 Cash Disbursements $15,680,000 Cash, End $0 SuperMedia Services ? West Inc. changed its corporate name to SuperMedia Services Inc., effective Jan. 1, 2011. SuperMedia Sales ? West Inc. disclosed: Cash, Beginning $0 Cash Receipts $7,182,000 Cash Disbursements $7,182,000 Cash, End $0 SuperMedia Sales ? West Inc. changed its corporate name SuperMedia Sales Inc., effective Jan. 1, 2011. A copy of the post-confirmation quarterly report is available for free at http://is.gd/7zduRx About SuperMedia Inc. DFW Airport, Texas-based SuperMedia Inc. and its subsidiaries sells advertising solutions to its clients and places their advertising into its various advertising media. The Company's advertising media include Superpages yellow page directories, Superpages.com, its online local search resource, the Superpages.com network, an online advertising network, Superpages direct mailers, and Superpages mobile, its local search application for wireless subscribers. The Company is the official publisher of Verizon Communications Inc. print directories in the markets in which Verizon is currently the incumbent local telephone exchange carrier. The Company also has agreements with FairPoint Communications, Inc., and Frontier Communications Corporation in various Northeast and Midwest markets in which FairPoint and Frontier are the local exchange carriers. On March 31, 2009, SuperMedia Inc., formerly known as Idearc Inc., and all of its domestic subsidiaries filed voluntary petitions for Chapter 11 relief (Bankr. N.D. Tex. Lead Case No. 09-31828). On Sept. 8, 2009, the Company filed its First Amended Joint Plan of Reorganization with the Bankruptcy Court, which was later modified on Nov. 19, 2009, and on Dec. 22, 2009, the Bankruptcy Court entered an order approving and confirming the Amended Plan. On Dec. 31, 2009 (the "Effective Date"), the Debtors consummated the reorganization and emerged from the Chapter 11 bankruptcy proceedings. On Dec. 29, 2011, the Bankruptcy Court entered final decrees closing the bankruptcy cases for the Debtors. SuperMedia Inc. and subsidiaries reported a net loss of $909.0 million on $1.258 billion of operating revenue for the nine months ended Sept. 30, 2011, compared with a net loss of $252.0 million on $750.0 million of operating revenue for the same period of 2010. The Company's balance sheet at Sept. 30, 2011, showed $1.834 billion in total assets, $2.758 billion in total liabilities, and a stockholders' deficit of $924.0 million. * * * As reported in the TCR on Dec. 27, 2011, Standard & Poor's Ratings Services raised its corporate credit rating on Dallas-based SuperMedia Inc. to 'CCC+' from 'SD' (selective default). The rating outlook is negative. TEXAS COMPETITIVE: S&P Keeps 'CCC' Issuer Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Brazos River Authority's bonds series 2001I, 2001D-2, and 2002A to 'A/A- 1' from 'A+/A-1'. The bonds are fully supported by letters of credit (LOCs) from Citibank N.A. "The rating actions reflect the Nov. 29, 2011, lowering of our rating on Citibank N.A. to 'A/A-1' from 'A+/A-1' and the application of our joint-support criteria," S&P said. "We downgraded the bonds after applying our joint-support criteria using our lowered rating on Citibank N.A., the LOC provider, and our rating on Texas Competitive Electric Holding Co. LLC ('CCC'), the obligor. For these transactions, the long-term components of our ratings are based on our long-term issuer credit ratings on, as well as the joint support provided by, Citibank N.A. and the obligor, assuming a low correlation level between the LOC provider and obligor. Based on the application of our joint criteria, there is no rating elevation to the long-term components of our ratings on the bonds due to the rating on the obligor. The short- term components of our ratings are based solely on our short-term issuer credit rating on Citibank N.A. because we currently do not assign a short-term rating to Texas Competitive Electric Holding Co. LLC," S&P said. "The long-term components of our ratings on all of the bonds address full and timely payments of interest and principal when the bondholders have not exercised the put option. The short-term components of our ratings address full and timely payments of interest and principal when the bondholders have exercised the put option," S&P said. "Changes to our ratings on these LOC-backed bonds can result from, among other things, changes to our rating on the LOC provider or obligor, changes to our correlation assumptions in our joint- support criteria, the expiration or termination of the LOCs, or amendments to the transactions' terms," S&P said. Standard & Poor's 17g-7 Disclosure Report SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this credit rating report is available at: http://standardandpoorsdisclosure-17g7.com Ratings Lowered Transaction CUSIP Rating To From Brazos River Authority $62.92 mil poll ctl rev rfdg bnds ser 2001I due 12/01/2036 106213FQ9 A/A-1 A+/A-1 $60.65 mil poll ctl rev rfdg bnds ser 2002A due 05/01/2037 106213FV8 A/A-1 A+/A-1 $98.53 mil poll ctl rev rfdg bnds ser 2001D-2 due 05/01/2033 106213GG0 A/A-1 A+/A-1 TRAILER BRIDGE: Unsecured Creditors to Receive 25%-85% Recovery --------------------------------------------------------------- On Jan. 14, 2012, Trailer Bridge, Inc., filed a Chapter 11 Plan of Reorganization and a related Disclosure Statement with the U.S. Bankruptcy Court for the Southern District of New York. Under the proposed Plan, current holders of the $82.5 million 9.25% Senior Secured Notes would receive a pro rata share of a $65 million debt instrument and 91% interest in the newly restructured company. Estimated recovery is 75%. If the Plan is approved, secured creditors and contract parties will receive 100% payment on their pre-filing claims. Unsecured creditors, with estimated aggregate claims of $2 million to $4 million will receive their pro rata distribution from funds made available to them from an exit financing facility provided by the Majority Note Holders. Unsecured creditors will have a recovery of 25-85%. Additionally, the holders of Trailer Bridge's existing common equity will have the option to receive 9% of the reorganized Company's common equity or a cash payment of $0.15 per share. A copy of the Plan is available for free at http://is.gd/YwUNih A copy of the Disclosure Statement with respect to the Plan is available for free at http://is.gd/bVGlhs About Trailer Bridge Jacksonville, Fla.-based Trailer Bridge, Inc. -- http://www.trailerbridge.com/-- provides integrated trucking and marine freight service to and from all points in the lower 48 states and Puerto Rico and Dominican Republic. This total transportation system utilizes its own trucks, drivers, trailers, containers and U.S. flag vessels to link the mainland with Puerto Rico via marine facilities in Jacksonville, San Juan and Puerto Plata. Trailer Bridge filed a voluntary Chapter 11 petition (Bankr. M.D. Fla. Case No. 11-08348) on Nov. 16, 2011, one day after its $82.5 million 9.25% Senior Secured Notes became due. Judge Jerry A. Funk presides over the case. Gardner F. Davis, Esq., at Foley & Lardner LLP, and DLA Piper LLP (US) serve as the Debtor's counsel. Global Hunter Securities LLC serves as the Debtor's investment banker. RAS Management Advisors LLC serves as the Debtor's financial advisor. The Debtor disclosed $97,345,981 in assets, and $112,538,934 in liabilities. The petition was signed by Mark A. Tanner, co-chief executive officer. TRIBUNE CO: Bank Debt Trades at 37% Off in Secondary Market ----------------------------------------------------------- Participations in a syndicated loan under which Tribune Co. is a borrower traded in the secondary market at 62.69 cents-on-the- dollar during the week ended Friday, Jan. 20, 2012, an increase of 2.29 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 300 basis points above LIBOR to borrow under the facility. The bank loan matures on May 17, 2014. Moody's has withdrawn its rating on the loan. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRONOX INC: Kerr-McGee and Anadarko Fail to Get Damages Cap ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Kerr-McGee Corp. and Anadarko Petroleum Corp. lost a skirmish with successfully reorganized Tronox Inc. when the bankruptcy judge ruled on Jan. 20 that there is no cap on potential damages they must pay if they lose the trial beginning in May where they are being sued for billions of dollars to cover costs of environmental cleanup. The report relates that Anadarko and Kerr-McGee, the former parent of Tronox, filed a motion asking U.S. Bankruptcy Judge Allan L. Gropper to declare that they can't be liable for more than the shortfall on creditors' claims. Judge Gropper disagreed, saying that the "appropriate measure of damages, if any, can only be determined after trial of all relevant issues." Mr. Rochelle discloses that Anadarko argued that Section 550(a) of the U.S. Bankruptcy Code caps liability at the creditors' shortfall. Judge Gropper said that the "benefit of the estate" language in Section 550(a) isn't a cap on damages. The judge said he could find no case requiring a calculation of all creditors' claims and the resulting deficiency before fixing the amount of liability for a fraudulent transfer. Tronox is suing to recover environmental remediation costs it was given when spun off by Kerr-McGee in March 2006. Anadarko acquired Kerr-McGee for $18.4 billion in August 2006. In his 20- page opinion, Judge Gropper said the possible range of damages was as high as $15.5 billion. Another method, Judge Gropper said, would yield damages between $1.9 billion and $6.2 billion. Anadarko and Kerr-McGee have yet another method producing maximum damages of about $1.5 billion. The case is TRONOX INCORPORATED, TRONOX WORLDWIDE LLC f/k/a Kerr- McGee Chemical Worldwide LLC, and TRONOX LLC f/k/a Kerr-McGee Chemical LLC, Plaintiffs, v. ANADARKO PETROLEUM CORPORATION, KERR- McGEE CORPORATION, KERR-MCGEE OIL & GAS CORPORATION, KERR-MCGEE WORLDWIDE CORPORATION, KERR-MCGEE INVESTMENT CORPORATION, KERR- MCGEE CREDIT LLC, KERR-MCGEE SHARED SERVICES COMPANY LLC, and KERR-MCGEE STORED POWER COMPANY LLC, Defendants; THE UNITED STATES OF AMERICA, Plaintiff-Intervenor, v. TRONOX INCORPORATED, TRONOX WORLDWIDE LLC, KERR-MCGEE CORPORATION, and ANADARKO PETROLEUM CORPORATION, Defendants Adv. Proc. No. 09-1198 (Bankr. S.D.N.Y.). A copy of Judge Gropper's Jan. 20 Memorandum of Opinion is available at http://is.gd/0Nzxu3from Leagle.com. About Tronox Inc. Tronox Inc., aka New-Co Chemical, Inc., and 14 other affiliates filed for Chapter 11 protection on Jan. 13, 2009 (Bankr. S.D.N.Y. Case No. 09-10156), before Hon. Allan L. Gropper. Richard M. Cieri, Esq., Jonathan S. Henes, Esq., and Colin M. Adams, Esq., at Kirkland & Ellis LLP in New York, represented the Debtors. The Debtors also tapped Togut, Segal & Segal LLP as conflicts counsel; Rothschild Inc. as investment bankers; Alvarez & Marsal North America LLC, as restructuring consultants; and Kurtzman Carson Consultants served as notice and claims agent. An official committee of unsecured creditors and an official committee of equity security holders were appointed in the cases. The Creditors Committee retained Paul, Weiss, Rifkind, Wharton & Garrison LLP as counsel. Until Sept. 30, 2008, Tronox was publicly traded on the New York Stock Exchange under the symbols TRX and TRX.B. Since then, Tronox has traded on the Over the Counter Bulletin Board under the symbols TROX.A.PK and TROX.B.PK. As of Dec. 31, 2008, Tronox had 19,107,367 outstanding shares of class A common stock and 22,889,431 outstanding shares of class B common stock. On Nov. 17, 2010, the Bankruptcy Court confirmed the Debtors' First Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code, dated Nov. 5, 2010. Under the Plan, Tronox reorganized around its existing operating businesses, including its facilities at Oklahoma City, Oklahoma; Hamilton, Mississippi; Henderson, Nevada; Botlek, The Netherlands and Kwinana, Australia. TXU CORP: Bank Debt Trades at 41% Off in Secondary Market --------------------------------------------------------- Participations in a syndicated loan under which TXU Corp., now known as Energy Future Holdings Corp., is a borrower traded in the secondary market at 59.49 cents-on-the-dollar during the week ended Friday, Jan. 20, 2012, a drop of 3.64 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 450 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 10, 2017, and carries Moody's B2 rating and Standard & Poor's CCC rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Energy Future Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leverage buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. Energy Future Holdings Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $710 million on $2.32 billion of operating revenues for the three months ended Sept. 30, 2011, compared with a net loss of $2.90 billion on $2.60 billion of operating revenue for the same period during the prior year. The Company also reported a net loss of $1.77 billion on $5.67 billion of operating revenue for the nine months ended Sept. 30, 2011, compared with a net loss of $2.97 million on $6.59 billion of operating revenue for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $44.02 billion in total assets, $51.68 billion in total liabilities and a $7.66 billion total deficit. The Company's consolidated balance sheets at Dec. 31, 2010, showed $46.388 billion in total assets, $52.299 billion in total liabilities, and a stockholders' deficit of $5.911 billion. * * * In April 2011, Moody's Investors Service affirmed the 'Caa2' Corporate Family Rating, 'Caa3' Probability of Default Rating and SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially distressed company with limited financial flexibility; its capital structure appears to be untenable, calling into question the sustainability of the business model; and there is no expectation for any meaningful debt reduction over the next few years, beyond scheduled amortizations. At the end of February 2011, Fitch Ratings it does not expect to take any immediate rating action on EFH's Texas Competitive Electric Holdings Company LLC or their affiliates based on recent default allegations from lender Aurelius. EFH carries a 'CCC' corporate rating, with negative outlook, from Fitch. TXU CORP: Bank Debt Trades at 37% Off in Secondary Market --------------------------------------------------------- Participations in a syndicated loan under which TXU Corp., now known as Energy Future Holdings Corp., is a borrower traded in the secondary market at 63.39 cents-on-the-dollar during the week ended Friday, Jan. 20, 2012, a drop of 4.69 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 350 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 10, 2014, and carries Standard & Poor's CCC rating. The loan is one of the biggest gainers and losers among 131 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Energy Future Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leverage buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. Energy Future Holdings Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $710 million on $2.32 billion of operating revenues for the three months ended Sept. 30, 2011, compared with a net loss of $2.90 billion on $2.60 billion of operating revenue for the same period during the prior year. The Company also reported a net loss of $1.77 billion on $5.67 billion of operating revenue for the nine months ended Sept. 30, 2011, compared with a net loss of $2.97 million on $6.59 billion of operating revenue for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $44.02 billion in total assets, $51.68 billion in total liabilities and a $7.66 billion total deficit. The Company's consolidated balance sheets at Dec. 31, 2010, showed $46.388 billion in total assets, $52.299 billion in total liabilities, and a stockholders' deficit of $5.911 billion. * * * In April 2011, Moody's Investors Service affirmed the 'Caa2' Corporate Family Rating, 'Caa3' Probability of Default Rating and SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially distressed company with limited financial flexibility; its capital structure appears to be untenable, calling into question the sustainability of the business model; and there is no expectation for any meaningful debt reduction over the next few years, beyond scheduled amortizations. At the end of February 2011, Fitch Ratings it does not expect to take any immediate rating action on EFH's Texas Competitive Electric Holdings Company LLC or their affiliates based on recent default allegations from lender Aurelius. EFH carries a 'CCC' corporate rating, with negative outlook, from Fitch. VEGAS INC: Sec. 341(a) Creditors' Meeting Set for Feb. 13 --------------------------------------------------------- The United States Trustee for the Eastern District of Michigan in Detroit will convene a meeting of creditors pursuant to 11 U.S.C. Sec. 341(a) in the Chapter 11 case of Vegas Inc., aka Vegas Liquor, on Feb. 13, 2012, at 2:00 p.m. at room 315 E, 211 W. Fort St. Bldg. in Detroit. Proofs of claim are due by May 14, 2012. Detroit-based Vegas Inc., aka Vegas Liquor, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 12-40572) on Jan. 11, 2012. Judge Steven W. Rhodes presides over the case. Donald C. Darnell, Esq., at Darnell PLLC in Dexter, Michigan, serves as the Debtor's counsel. In its petition, the Debtor estimated $100 million to $500 million in assets and debts. The petition was signed by Mark Thuwaini, president. VEGAS INC: Initial Status Conference Set for Feb. 13 ---------------------------------------------------- The Bankruptcy Court set an Initial Chapter 11 Status Conference for Feb. 13, 2012, at 10:30 a.m. at Courtroom 1825. Vegas Inc. faces a Jan. 25 deadline to file with the Court its schedules of assets and liabilities and statement of financial affairs. Detroit-based Vegas Inc., aka Vegas Liquor, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 12-40572) on Jan. 11, 2012. Judge Steven W. Rhodes presides over the case. Donald C. Darnell, Esq., at Darnell PLLC in Dexter, Michigan, serves as the Debtor's counsel. In its petition, the Debtor estimated $100 million to $500 million in assets and debts. The petition was signed by Mark Thuwaini, president. VEGAS INC: Files List of 6 Largest Unsecured Creditors ------------------------------------------------------ Vegas Inc. filed with the Bankruptcy Court a list of its six largest unsecured creditors, disclosing: Entity Nature of Claim Amount ------ --------------- ------ City of Detroit 2010-2011 personal Unknown CYMC property taxes 2 Woodward Ave - Ste. 120 Detroit, MI 48226 DTE Energy Energy Unknown One Energy Plaza Detroit, MI 48226 Internal Revenue Service 941 taxes Unknown SBSE/Insolvency Unit PO Box 330500, Stop 15 Detroit, MI 48232 JPMorgan Chase Bank, N.A. Commercial loan $194,046 c/o Alexsy Law Group. PC 440 E. Congress, Ste. 3R Detroit, MI 48226 Michigan Department of 160 taxes Unknown Treasury-CD P.O. Box 30199 Lansing, MI 48909 United Distribution Group LLC All property Unknown 25700 W. Eight Mile Rd. $150,000 Southfield, MI 48033 Detroit-based Vegas Inc., aka Vegas Liquor, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 12-40572) on Jan. 11, 2012. Judge Steven W. Rhodes presides over the case. Donald C. Darnell, Esq., at Darnell PLLC in Dexter, Michigan, serves as the Debtor's counsel. In its petition, the Debtor estimated $100 million to $500 million in assets and debts. The petition was signed by Mark Thuwaini, president. WASHINGTON MUTUAL: Feb. 16 Hearing on Ex-Officers' Deal With FDIC --------------------------------------------------*-------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that there will be a hearing in bankruptcy court Feb. 16 for approval of the settlement among Washington Mutual Inc., the Federal Deposit Insurance Corp. and three of WaMu's former officers and directors. The parties agreed to settle a lawsuit where the providers of directors' and officers' liability insurance will pay the FDIC $39.6 million. Mr. Rochelle recounts that when WaMu's bank subsidiary failed, the FDIC as receiver assumed the right to sue bank officers. In March, the FDIC filed a complaint against former Chief Executive Officer Kerry Killinger, ex-President Stephen Rotella and David Schneider. The report relates that in addition to the $39.6 million from insurance, the settlement provides for the three former officers to hand over to the FDIC whatever they collect from their claims against WaMu. In addition, the three individuals will pay a combined $425,000. The insurance companies also agree not to make a claim for indemnification against WaMu. At the Feb. 16 hearing, WaMu will attempt once again to obtain confirmation of a Chapter 11 plan. New disclosure materials were approved at a Jan. 11 hearing so creditors affected by the revised plan can vote again. About Washington Mutual 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. 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. WESTERN ENERGY: Moody's Assigns 'B2' Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service assigned a B3 rating to Western Energy Service's Corp.'s (Western) proposed C$125 million senior unsecured notes issue. Moody's also assigned Western a B2 Corporate Family Rating (CFR) and Probability of Default Rating and a Speculative Grade Liquidity rating of SGL-3. The rating outlook is stable. This is the first time Moody's has rated Western Energy Corp. RATINGS RATIONALE "Western's B2 CFR reflects its fleet of high quality rigs, term contracts for 60% of its rig fleet, low leverage, good liquidity and a solid, industry-experienced management team" said Terry Marshall, Moody's Senior Vice President. "The rating also considers Western's very short corporate and operating history due to its recent growth through several acquisitions, exposure to the cyclical land drilling business, concentration in the Western Canadian Sedimentary Basin, and anticipated negative free cash flow as the company expands its rig fleet. The rating further considers anticipated acquisitions in support of the rig business as well as expansion in the rig service business." Western Energy's SGL-3 liquidity rating reflects adequate liquidity with internally generated cash flow expected to cover all of the company's maintenance capex (approximately C$25 million per annum) and most of its growth capex through 2012. At closing of the proposed C$125 million notes offering the company will have minimal cash, an undrawn revolver of C$150 million, and should not be challenged by its three financial covenants through 2012. Alternate liquidity is limited given that substantially all of the company's assets are pledged under the revolver. The stable outlook considers the company's contracted position and anticipated strong demand for its long reach horizontal rigs over the next 12 to 18 months. The rating could be raised if the company successfully integrates recent and anticipated acquisitions and appears able to maintain leverage as measured by total debt to EBITDA below 2x. The rating could be downgraded if the company is unable to renew its rig contracts as they mature or if it approaches a covenant default. The C$125 million senior unsecured notes are rated one notch below the B2 CFR because of the existence in the capital structure of the prior-ranking C$150 million secured revolver. The principal methodology used in rating Western was the Global Oilfield Services 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. Western Energy Services Corp. is a Calgary Alberta based company engaged in the provision of land contract drilling services to North American Exploration and Production (E&P) companies. Assignments: Issuer: Western Energy Services Corp. -- Probability of Default Rating, Assigned B2 -- Speculative Grade Liquidity Rating, Assigned SGL-3 -- Corporate Family Rating, Assigned B2 -- Senior Unsecured Regular Bond/Debenture, Assigned a B3 (LGD5, 73%) WILLIAM LYON: Gets Final OK to Access $30-Mil. Bankruptcy Loan -------------------------------------------------------------- Judge Christopher H. Sontchi entered a final order permitting William Lyon Homes, Inc., et al., to obtain postpetition financing of up to $30,000,000 from ColFin WLH Funding, LLC, as administrative agent, for itself and certain lenders from time to time. The DIP loan proceeds may be used in accordance with a prepared budget, a copy of which is available for free at: http://bankrupt.com/misc/WILLIAMLYON_DIPLoanBudget.pdf All obligations related to the DIP Loan constitute allowed claims against the Debtors with priority over administrative expenses, diminution claims, and all other claims against the Debtors. As security for the DIP Obligations, the DIP Lenders are granted liens on the Debtors' property. Moreover, the Debtors are authorized on a final basis to use cash collateral of their pre-bankruptcy lenders. Each Prepetition Lender is entitled to adequate protection for and equal in amount to the aggregate net diminution in the value of that Lender's interests in the Prepetition Collateral, including the Cash Collateral, in the form of replacement liens. As reported in the Dec. 28, 2011 edition of the Troubled Company Reporter, as of the petition date, the Debtors owe the prepetition secured parties not less than $206 million. The Debtors are also liable to a Make Whole Amount as defined in the prepetition loan agreement and an exit fee. The prepetition secured parties assert that the Make Whole Amount due and owing is not less than $69 million and the exit fee is not less than $12.9 million. The DIP liens and adequate protection liens are subject to a carve-out for unpaid fees of the Clerk of Court and the U.S. Trustee pursuant to 28 U.S.C. Sec. 1930(a)(6); bankruptcy professional fees; and unpaid fees and expenses of the ad hoc group of noteholders (not to exceed $535,000) and the so-called backstop investors (not to exceed $200,000) in the case. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and its subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. William Lyon Homes and its affiliates commenced a prepackaged Chapter 11 reorganization (Bankr. D. Del. Lead Case No. 11-14019) on Dec. 19, 2011. William Lyon had been pursuing an out-of-court restructuring since January. The reorganization plan, announced in November, will reduce debt on borrowed money from $510 million to $328 million. The Debtors intend to obtain approval of the bankruptcy plan at a hearing beginning Feb. 10, 2012. The Chapter 11 plan already has been accepted by 97% in amount and 93% in number of senior unsecured notes. The Plan exchanges the notes for equity and generates $85 million in new cash. Holders owed $300 million on senior unsecured notes are to exchange the debt for $75 million in new secured notes plus 28.5% of the common equity. The Lyon family will invest $25 million in return for 20% of the common stock and warrants for another 9.1%. Senior secured lenders led by ColFin WLH Funding LLC, an affiliate of real-estate finance and investment company Colony Financial Inc., would receive a new $235 million 10.25% three-year secured note for existing secured claim of at least $206 million in principal. There will be a rights offering to buy $10 million in common stock and $50 million in convertible preferred stock, representing 51.5% of the new equity. A noteholder has agreed to buy any of the offering that isn't purchased. The company didn't make a $7.5 million interest payment payable Oct. 1, 2011, on $138.8 million in 10.75% senior notes due 2013. William Lyon expects to pay its remaining creditors in full, including vendors and other general unsecured creditors. Judge Christopher S. Sontchi presides over the case. Lawyers at Pachulski Stang Ziehl & Jones LLP serve as the Debtors' counsel. Lawyers at Irell & Manella LLP serve as their special counsel. Alvarez & Marsal Holdings LLC serves as the Debtors' financial advisors. Kurtzman Carson Consultants, LLC, serves as the Debtors' claims and notice agent. The petition says assets are $593.5 million with debt totaling $606.6 million as of Sept. 30, 2011. Counsel to the Backstop Investors are Matthew K. Kelsey, Esq., and J. Eric Wise, Esq., at Gibson, Dunn & Crutcher LLP. Counsel to the Ad Hoc Noteholders Group are Mark Shinderman, Esq., and Neil Wertlieb, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Delaware Counsel to the Ad Hoc Noteholders Group is Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP. The Prepetition Agent and the Prepetition Secured Lenders are represented by David P. Simonds, Esq., at Akin Gump Strauss Hauer & Feld LLP and David Stratton, Esq., at Pepper Hamilton LLP. The Prepetition Lenders also have hired FTI Consulting Inc. as advisors. WESTLAND PARCEL: Can Use Cash Collateral Til Jan. 31 ---------------------------------------------------- Westland Parcel J Partners, LLC won court approval for continued access to cash collateral of Pacific Western Bank through Jan. 31, 2012 pursuant to a budget, a copy of which is available for free at http://bankrupt.com/misc/WESTLANDPARCEL_BudgetJan2012.pdf The U.S. Bankruptcy Court for the Central District of California's ruling came upon the Debtor's 7th stipulation with Pacific Western, through the bank's counsel, T. Courtney Dubar. A continued hearing on the cash collateral use will be held on Feb. 8, 2012. About Westland Parcel J Partners Long Beach, California-based Westland Parcel J Partners, LLC, filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 10-58987) on Nov. 15, 2010. Jeffrey S Shinbrot, Esq., at The Shinbrot Firm, assists the Debtor in its restructuring effort. Kallman & Co., LLC, serves as its certified public accountants. AG Commercial serves as its leasing broker. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliate David William Neary (Bankr. C.D. Calif. Case No. 10- 39802) filed separate Chapter 11 petition on July 20, 2010. WJO INC: Can Use Tristate Cash Collateral Thru Jan. 31 ------------------------------------------------------ WJO Inc. won bankruptcy court approval of its tenth stipulation with Tristate Capital Bank for continued use of the cash collateral through Jan. 31, 2012 pursuant to a prepared budget, a copy of which is available for free at: http://bankrupt.com/misc/WJO_BudgetJan2012.pdf The Debtor's prepetition lender is granted valid and perfected replacement liens in all of the Debtor's assets as adequate protection of the lender's interest in the cash collateral. A further interim hearing on the cash collateral use will be held on Jan. 25, at 9:30 a.m. About WJO Inc. Bristol, Pennsylvania-based WJO, Inc., operates six family practices located in Newtown, Bristol, Bensalem, Bustleton, South Philadelphia, and Bethlehem, Pennsylvania and consists of Board Certified Osteopathic Physicians specializing in Family Medicine. Prior to the petition date, and to allow the Company to restructure effectively, HyperOx Inc., HyperOx I, LP, HyperOx III, LP, and East Coast TMR, Inc., were merged into WJO. WJO filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No. 10-19894) on Nov. 15, 2010. The Debtor disclosed $19,923,802 in assets and $6,805,255 in liabilities as of the Chapter 11 filing. Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy counsel. Pond Lehocky Stern Giordano serves as the Debtor's special counsel to represent it in worker's compensation proceedings pertaining to the Therapeutic Magnetic Resonance treatments. Patrick Yun serves as the Debtor's financial advisor. Attorneys at Keifer & Tsarouhis LLP serve as counsel to the official committee of unsecured creditors. ParenteBeard LLC serves as the Committee's accountant and financial advisor. The United States Trustee has appointed David Knowlton as patient care ombudsman in the case. The Ombudsman is represented in the case by Karen Lee Turner, Esq., at Eckert Seamans Cherin & Mellott, LLC, as counsel. Tristate Capital Bank, the cash collateral lender, is represented in the case by lawyers at Benesch Friedlander Coplan & Aronoff LLP. * Kodak Filing Leads to Increase in Liquidity-Stress Index ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the bankruptcy of Eastman Kodak Co. by itself was responsible for a slight increase in a measure of financial distress among junk-rated companies. In the first half of January, the liquidity-stress index rose to 4.9% from 4.8%, where it stood at the end of December, according to a report from Moody's Investors Service. The uptick was the result of a downgrade in Kodak's liquidity rating just before the Chapter 11 filing last week. The report relates that Moody's said that the increase in the liquidity-stress index "foreshadows an increase in the U.S. speculative-grade corporate default rate in 2012. Moody's has been predicting that the junk default rate, 1.8% at the end of 2011, will climb to 2.8% by the conclusion of 2012. The liquidity-stress index is the percentage of junk-rated companies with the weakest liquidity. The high for the index was 20.9% in March 2009. Credit-rating upgrades were exceeding downgrades until July, when downgrades became more numerous for junk companies, Moody's said. * Recovery of U.S. Auto Makers, Suppliers Leads to Job Gains ------------------------------------------------------------ Dow Jones' Daily Bankruptcy Review reports that big auto makers and their suppliers are spending billions to expand and retool U.S. factories, pushing heartland states to jockey to land new auto jobs. * NACBA Outlines Initiatives Planned on Ethnicity, Ch. 11 Filings ----------------------------------------------------------------- Bankruptcy attorney William Brewer, president of the National Association of Consumer Bankruptcy Attorneys (NACBA), which is the only national organization dedicated to serving the needs of consumer bankruptcy attorneys and protecting the rights of consumer debtors in bankruptcy, issued the following statement today: "The National Association of Consumer Bankruptcy Attorneys has always favored a direct and unflinching examination of the bankruptcy process in America. We believe in fair play and have no reservations whatsoever about having tough questions posed about the practices of debtors' attorneys. It is our view that bankruptcy is simply too important a process in the lives of Americans facing their darkest hours to allow any party - creditors, trustees or consumer legal advocates - to escape scrutiny. That is why one of NACBA's board members was a key player in the new study that examines the impact of ethnicity on bankruptcy filings. We believe that this study is an important start - a much-needed first look - illuminating the path needed for further research. If the necessary fuller research indicates that there is, indeed, an unfair disparity in how Americans are handled in bankruptcy, NACBA will be the first party in line to propose necessary changes remedy any such imbalance. In the meantime, we believe it is important to underscore the findings of the researchers that there is no evidence that racism plays any part here. We can vouch for the fact that bankruptcy attorneys, who deal each year with hundreds of thousands of American families of all races, colors and creeds, are in fact the first-line defenders for Americans who have been unemployed for long periods of time, crushed by crippling health care bills, trapped in the foreclosure crisis, or otherwise fallen on hard times. Even without the more detailed research needed to resolve this issue, consumer bankruptcy attorneys have no intention of sitting by idly. NACBA's Board of Directors will address this issue at its next and subsequent board meetings, for the purpose of recommending any needed reforms, guidelines, or attorney practice changes that are warranted. Additionally, we expect to explore it fully at our next membership meeting in April in San Antonio, TX, where a special panel and full-group discussion will be held. It also is our intention to reach out to and confer with our many friends in organizations representing Americans of color. We have spent many long years working closely with these organizations to ensure that bankruptcy is fairer. They know who we are and what is in our hearts when it comes to fairness and equality for all Americans. In short, we will simply not rest on this question until we know all the facts and until we have taken every possible step to remedy whatever imbalance may exist." About Nacbanacba NACBANACBA (National Association of Consumer Bankruptcy Attorneys) -- http://www.nacba.org/-- is the only national organization dedicated to serving the needs of consumer bankruptcy attorneys and protecting the rights of consumer debtors in bankruptcy. Formed in 1992, NACBA has nearly 5,000 members located in all 50 states and Puerto Rico. NACBA's members represent a large number of the individuals who file bankruptcy cases in the United States Bankruptcy Courts. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total Holders Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------- ------- ANOORAQ RESOURCE ARQ SJ 927.7 (148.7) 29.2 AUTOZONE INC AZO US 5,932.6 (1,347.1) (736.3) LORILLARD INC LO US 3,152.0 (1,174.0) 1,299.0 DUN & BRADSTREET DNB US 1,775.6 (558.0) (478.3) MEAD JOHNSON MJN US 2,580.0 (144.8) 678.3 WEIGHT WATCHERS WTW US 1,086.5 (470.5) (292.3) CLOROX CO CLX US 4,077.0 (76.0) (30.0) TAUBMAN CENTERS TCO US 2,518.2 (467.9) - MEDIVATION INC MDVN US 188.3 (3.9) 89.4 DIRECTV-A DTV US 18,232.0 (2,471.0) 103.0 VERISK ANALYTI-A VRSK US 1,379.9 (158.9) (234.2) AMC NETWORKS-A AMCX US 2,121.5 (1,065.5) 519.5 SUN COMMUNITIES SUI US 1,328.6 (72.4) - MOODY'S CORP MCO US 2,521.3 (174.2) 525.1 CHOICE HOTELS CHH US 467.9 (14.4) 28.0 VERISIGN INC VRSN US 1,657.7 (166.7) 724.5 DOMINO'S PIZZA DPZ US 438.2 (1,221.0) 118.2 IMPERVA INC IMPV US 42.5 (6.6) (5.8) GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5 IPCS INC IPCS US 559.2 (33.0) 72.1 HCA HOLDINGS INC HCA US 23,756.0 (9,062.0) 2,422.0 MAINSTREET EQUIT MEQ CN 477.7 (11.1) - RENTECH NITROGEN RNF US 152.4 (76.1) (32.3) SALLY BEAUTY HOL SBH US 1,728.6 (219.0) 419.1 CHENIERE ENERGY CQP US 1,803.0 (524.1) 67.7 GROUPON INC GRPN US 795.6 (15.6) (301.0) UNISYS CORP UIS US 2,566.9 (594.5) 464.7 RSC HOLDINGS INC RRR US 3,075.9 (50.7) (199.1) AMERISTAR CASINO ASCA US 2,039.6 (105.7) (50.8) CAPMARK FINANCIA CPMK US 20,085.1 (933.1) - LEVEL 3 COMM INC LVLT US 9,254.0 (523.0) 1,058.0 THERAVANCE THRX US 283.3 (59.2) 229.4 MONEYGRAM INTERN MGI US 5,000.3 (108.2) 33.9 VECTOR GROUP LTD VGR US 931.0 (66.7) 252.6 RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 INCYTE CORP INCY US 371.2 (181.0) 225.5 RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) PROTECTION ONE PONE US 562.9 (61.8) (7.6) ANGIE'S LIST INC ANGI US 32.6 (38.9) (25.9) BOSTON PIZZA R-U BPF-U CN 146.9 (105.3) (2.0) REVLON INC-A REV US 1,081.7 (685.1) 148.6 CLOVIS ONCOLOGY CLVS US 26.4 (18.1) (19.2) OTELCO INC-IDS OTT-U CN 316.1 (10.1) 22.9 IDENIX PHARM IDIX US 88.8 (2.3) 54.6 CABLEVISION SY-A CVC US 6,740.1 (5,525.9) (886.1) OTELCO INC-IDS OTT US 316.1 (10.1) 22.9 MANNING & NAPIER MN US 66.1 (184.6) - NATIONAL CINEMED NCMI US 807.9 (346.2) 56.6 FREESCALE SEMICO FSL US 3,596.0 (4,488.0) 1,386.0 SINCLAIR BROAD-A SBGI US 1,563.8 (125.4) 45.7 WESTMORELAND COA WLB US 769.0 (174.4) (5.9) FNB UNITED CORP FNBN US 1,643.9 (129.9) - REGAL ENTERTAI-A RGC US 2,262.0 (555.7) (25.8) QUALITY DISTRIBU QLTY US 304.3 (105.9) 44.1 JUST ENERGY GROU JE CN 1,584.2 (242.2) (215.6) JUST ENERGY GROU JSTEF US 1,584.2 (242.2) (215.6) AMER AXLE & MFG AXL US 2,232.8 (373.3) 125.6 DEAN FOODS CO DF US 5,911.2 (58.1) 327.7 CHENIERE ENERGY LNG US 2,651.4 (446.9) (282.7) SINCLAIR BROAD-A SBTA GR 1,563.8 (125.4) 45.7 ACCO BRANDS CORP ABD US 1,050.3 (32.6) 298.7 LIZ CLAIBORNE LIZ US 1,144.0 (420.0) (97.3) NEXSTAR BROADC-A NXST US 582.7 (187.0) 26.2 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) TOWN SPORTS INTE CLUB US 445.1 (3.2) (30.8) WARNER MUSIC GRO WMG US 3,583.0 (289.0) (630.0) NYMOX PHARMACEUT NYMX US 6.5 (5.5) 3.3 ISTA PHARMACEUTI ISTA US 137.5 (34.8) (7.5) PRIMEDIA INC PRM US 208.0 (91.7) 3.6 BLUEKNIGHT ENERG BKEP US 320.8 (12.5) (69.9) QWEST COMMUNICAT Q US 16,849.0 (1,560.0) (2,828.0) NPS PHARM INC NPSP US 237.4 (38.6) 183.5 MERITOR INC MTOR US 2,663.0 (961.0) 206.0 PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PDL BIOPHARMA IN PDLI US 270.5 (243.2) 44.6 DIGITAL DOMAIN M DDMG US 178.9 (85.7) (38.3) MORGANS HOTEL GR MHGC US 480.8 (77.2) (4.1) PALM INC PALM US 1,007.2 (6.2) 141.7 GENCORP INC GY US 994.2 (143.4) 102.2 CC MEDIA-A CCMO US 16,508.9 (7,456.0) 1,531.3 VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 HUGHES TELEMATIC HUTC US 94.0 (111.8) (39.0) ABSOLUTE SOFTWRE ABT CN 120.2 (9.2) 2.7 SMART TECHNOL-A SMA CN 514.9 (9.4) 171.8 LIN TV CORP-CL A TVL US 815.8 (115.0) 56.6 SMART TECHNOL-A SMT US 514.9 (9.4) 171.8 DENNY'S CORP DENN US 280.6 (95.5) (40.1) HUGHES TELEMATIC HUTCU US 94.0 (111.8) (39.0) SYNERGY PHARMACE SGYP US 2.1 (8.6) (6.1) CENVEO INC CVO US 1,407.1 (331.1) 222.9 CINCINNATI BELL CBB US 2,683.8 (626.1) 22.7 CANADIAN SATEL-A XSR CN 174.4 (29.8) (55.9) ODYSSEY MARINE OMEX US 25.8 (0.7) (4.1) ********* 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 2012. 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 ***