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/raid1/www/Hosts/bankrupt/TCR_Public/080902.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, September 2, 2008, Vol. 12, No. 209 Headlines ALOHA AIRLINES: Court OKs Proposed Pay-Off Pact & Reimbursement AMERICAN HOME: Can Sell of 233 "Alt-A" Mortgages to Vantium ASARCO LLC: Parent Proposes to Set Cap on Unliquidated Claims ASARCO LLC: Court to Rule on Fraudulent Conveyance Suit This Month ASARCO LLC: U.S. Trustee Appoints Asbestos Creditors Committee ASHTON WOODS: Moody's Lowers Rating of Sr. Subor. Notes to Caa3 ASHTON WOODS: KPMG LLP Raises Going Concern Doubt AVADO BRANDS: Wants $6.5 Million KPMG-Sidley Agreement Approved BANC OF AMERICA: Fitch Affirms Ratings on BACM Series 2007-2 BUSINESS ALLIANCE: A.M. Best Rates Financial Strength At B(Fair) CAVTEL HOLDINGS: Moody's Junks Two Senior 1st Lien Secured Loans CBA COMMERCIAL: Fitch Takes Various Rating Actions on CBA 2006-2 CHA HAWAII: Voluntary Chapter 11 Case Summary CISTERA NETWORKS: Farmer Fuqua Raises Going Concern Doubt CLEARLY CANADIAN: Reports $2 Mil. Net Loss in Qtr. Ended June 30 CLICKABLEOIL.COM: Case Summary & 20 Largest Unsecured Creditors DAIRYLAND HAY: Case Summary & 20 Largest Unsecured Creditors EAGLETAIL BIGHORN: Voluntary Chapter 11 Case Summary FIRST AMERICAN: Fitch Affirms BB Rating on Trust Pref. Securities FLIGHT SAFETY: Wolf & Company Raises Going Concern Doubt FORD MOTOR: District Court Approves VEBA Health Care Trust Fund GENERAL MOTORS: Deserves $50BB Gov't-Backed Loans, Mr. Lutz Says GENOIL INC: Posts C$1.1MM Net Loss in 2008 1st Qtr. Ended June 30 GREEKTOWN CASINO: Creditors Panel Balks at Oct. 31 Claims Bar Date GREEKTOWN CASINO: Can Hire Honigman Miller as Special Counsel HICKORY HUT: Case Summary & 20 Largest Unsecured Creditors HOW COS: Deputy Receiver Sets Jan. 12, 2009 as Claims Bar Date IGNIS PETROLEUM: Names Geoff Evett as Acting CEO and Chairman INDYMAC BANCORP: Court Dumps Suit Against Bank, FDIC INTERNATIONAL RECTIFIER: Board Rejects Unsolicited Vishay Buyout JOHN WOLFE: Case Summary & 20 Largest Unsecured Creditors KIMBALL HILL: BMO Capital Seeks to File Consolidated Claim KIMBALL HILL: Highland Wants Decision Made on Sales Contract LANDSOURCE COMMUNITIES: Taps Paul Hastings as Special Counsel LANDSOURCE COMMUNITIES: Asks Court to Set Nov. 14 Claims Bar Date LANDSOURCE COMMUNITIES: Taps D&T as Auditor and Accountant LANDSOURCE COMMUNITIES: Panel May Retain Pachulski as Lead Counsel LASALLE COMMERCIAL: Fitch Cuts and Assigns Rating on 2 CMBS Deals LE JARDIN: Voluntary Chapter 11 Case Summary LEHMAN MORTGAGE: DBRS Puts Low-B Ratings on $3.68MM Class Certs. LEVITZ FURNITURE: Court Allows WFNNB's $1,892,587 Admin. Claim LEVITZ FURNITURE: Court Approves Set-Off Deal with DFS Services LINENS N THINGS: Expansion of Ernst & Young's Services Approved LINENS N THINGS: Trade Creditors to Get Stock Warrants Under Plan LYNNKOHN LLC: Legacy Asks Court to Dismiss Case or Appoint Trustee MPK ENTERPRISES: Voluntary Chapter 11 Case Summary NETEFFECT INC: Voluntary Chapter 11 Case Summary NEWPORT WAVES: Fitch Lowers 3 CDO Sub-Classes, Resolves Neg. Watch N CAROLINA MEDICAL: Fitch Holds BB Rating on Revenue Bonds S. 1998 NORTH OAKLAND: Section 341(a) Meeting Slated for September 2 NORTH OAKLAND: Gets Initial Nod to Use McLaren's $1.5MM DIP Loan PACIFIC LUMBER: Resumes Lumber Operations as Humboldt Redwood PCG SUMMIT-LAKELINE: Case Summary & 16 Largest Unsecured Creditors PCG SUMMIT-NORTHWOODS: Case Summary & 9 Largest Unsec. Creditors PHS GROUP: Court Appoints Tranzon to Market Somerset Assets PRC LLC: Has Until October 7 to Object to Creditors' Claims PRC LLC: Wants BofA's $2 Mil. Interest Claim Deemed as Unsecured PRC LLC: Names Gregory Carr as Senior VP of Sales and Marketing QUAKER FABRIC: Court Confirms Joint Liquidating Plan QUEBECOR WORLD: Court Okays Settlement of $3.8MM Claim with TSIC RPM TECHNOLOGIES: June 30 Balance Sheet Upside-Down by $2,264,260 SHARPER IMAGE: Wants to Set Oct. 13 as Admin. Claims Bar Date SHARPER IMAGE: Court Approves Committee/Joint Venture Settlement SHARPER IMAGE: Court Okays Settlement of $3.8MM Quebecor Claim SHARPER IMAGE: Gift Card Holders Rep. Pursues Conversion Motion SHARPER IMAGE: Transfers Principal Offices to Walnut Creek SWANSEA PROPERTIES: Voluntary Chapter 11 Case Summary THORNBURG MORTGAGE: May Not be Able to Continue Operating TWEETER HOME: Wants Plan Filing Extended Until December 2 TWEETER HOME: Anne David Wants Automatic Stay Lifted UNIVERSAL NURSING: Case Summary & 20 Largest Unsecured Creditors US DATAWORKS: Reports $109,481 Net Loss for Quarter Ended June 30 VERENIUM CORP: Posts $16.4 Million Net Loss in 2008 Second Quarter VILLA DEL SOL : Case Summary & 1 Largest Unsecured Creditor VISUAL MANAGEMENT: June 30 Balance Sheet Upside-Down by $3.88 Mil. WESTERN NONWOVEN: Fire Retardant Business Acquired by Milliken WR GRACE: Can Implement 2008-2010 Incentive Plan * D'Aversa Joins Orrick Herrington from Mayer Brown ********* ALOHA AIRLINES: Court OKs Proposed Pay-Off Pact & Reimbursement --------------------------------------------------------------- Judge Lloyd King of the U.S. Bankruptcy for the District of Hawaii approved a pay-off agreement between Dane S. Field, the Chapter 7 trustee overseeing the liquidation of Aloha Airlines' bankruptcy case, and Continental Airlines, Bankruptcy Law360 reports. The Court also approved a reimbursement of certain employee expenses, the report adds. About Aloha Airgroup Based in Honolulu, Hawaii, Aloha Airgroup Inc., Aloha Airlines Inc. -- http://www.alohaairlines.com/-- and its affiliates are carriers that fly passengers and freight to Hawaii's five major airports, as well as to half a dozen destinations in the western U.S. They operate a fleet of about 20 aircraft, all Boeing 737s, including three configured as freighters. Aloha filed for Chapter 11 protection on Dec. 30, 2004 (Bankr. D. Hawaii Case No. 04-03063), and emerged from Chapter 11 bankruptcy protection in February 2006. The company and its affiliates again filed for Chapter 11 protection on March 18, 2008 (Bankr. D. Hawaii Lead Case No. 08- 00337). Brian G. Rich, Esq., Jordi Guso, Esq., and Paul Steven Singerman, Esq., at Berger Singerman P.A., and David C. Farmer, Esq., represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors was represented by Sonnenschein Nath & Rosenthal LLP and Bronster Hoshibata, A Law Corporation. The Debtors' schedules reflected total assets of $74,600,000 against total liabilities of $197,100,000. On April 29, 2008, the Court converted the Debtors' cases into Chapter 7 liquidation proceedings. The next day, the U.S. Trustee appointed Dane S. Field to serve as chapter 7 trustee for the cases. James Wagner, Esq., represents Mr. Field. AMERICAN HOME: Can Sell of 233 "Alt-A" Mortgages to Vantium ------------------------------------------------------------- Bankruptcy Law360 reports that the Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware allowed American Home Mortgage Inc. to sell 233 "Alt-A" mortgages to Vantium Capital Markets LP. American Home will sell the mortgages for $19.3 million, Bankruptcy Law360, says, citing the firm's counsel. Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for Chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. The Creditors Committee also retained Hennigan, Bennett & Dorman LLP, as special conflicts counsel, nunc pro tunc to March 3, 2008. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. (American Home Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service, Inc., Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Parent Proposes to Set Cap on Unliquidated Claims ------------------------------------------------------------- Asarco Incorporated and Americas Mining Corporation ask the U.S. Bankruptcy Court for the Southern District of Texas to approve procedures to determine the maximum allowed amounts of certain unliquidated claims for plan distribution purposes. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy, LLP, in New York, notes that the plan of reorganization filed by ASARCO LLC and its debtor-affiliates on July 31, 2008, does not contain a cap on distributions for unliquidated asbestos and environmental claims against the Debtors. He asserts that the Debtors' Plan cannot possibly be confirmed because, as currently proposed, it contains no limit on the amount of distributions that the holders of the environmental and asbestos claims can receive and it is not fair and equitable for these claimants to receive more than 100% of the allowed amount of their claims. Because the Debtors' Plan fails to limit the holders of asbestos and enviromental claims' recovery to no more than 100% of their allowed claims, Mr. Despins argues that the Court must determine the maximum amount of their allowed claims prior to proceeding to confirmation. This determination is crucial in light of the fact that under the Parent's plan of reorganization, the holders of these claims will be offered 100% cash recovery by the Parent and to implement this Plan. Rather than the Court trying to determine the impact of the uncapped claims at the confirmation hearing, Asarco Inc. suggests that it would be much more efficient to establish an efficient procedure to address or liquidate the Asbestos and Unresolved Environmental Claims. About ASARCO LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since April 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006. (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Debtors submitted to the Court a joint plan of reorganization and disclosure statement on July 31, 2008. As reported by the Troubled Company Reporter on August 28, 2008, Americas Mining Corporation, an affiliate of Grupo Mexico SAB de CV, submitted a reorganization plan to retain its equity interest in ASARCO LLC, by offering full payment to ASARCO's creditors in connection with ASARCO's Chapter 11 case. AMC would provide up to $2.7 billion in cash as well as a $440 million guarantee to assure payment of all allowed creditor claims, including payment of liabilities relating to asbestos and environmental claims. AMC's plan is premised on the estimation of the approximate allowed amount of the claims against ASARCO. Asarco Inc. and AMC are represented by Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York. Sander L. Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, APC, in Dallas, Texas, represents the Asarco Asbestos Subsidiary Committee. (ASARCO Bankruptcy News, Issue No. 81; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Court to Rule on Fraudulent Conveyance Suit This Month ------------------------------------------------------------------ The U.S. District Court for the Southern District of Texas, according to Bloomberg News, will issue a ruling on ASARCO LLC's fraudulent transfer litigation against Grupo Mexico S.A.B. de C.V., parent of Americas Mining Corporation. That ruling may coincide with the decision of the U.S. Bankruptcy Court for the Southern District of Texas on which of the two competing plans of reorganization -- one filed by ASARCO LLC and its debtor affiliates and the other filed by Americas Mining -- is the best plan for ASARCO LLC's creditors. If ASARCO LLC comes out successful in the fraudulent transfer litigation, Grupo Mexico may be forced to pay $8,250,000,000, or $1.03 a share, and give up its 100% equity interest in ASARCO LLC, the report said. ASARCO LLC filed the complaint in early February 2007 alleging that Grupo Mexico, its subsidiaries, officers and directors conspired for the transfer of 54.2% of ASARCO's equity interest in Southern Peru Copper Corporation, now known as Southern Copper Corporation, at a time when ASARCO was cash-strapped. German Larrea, chairman and chief executive officer of Grupo Mexico, denied the accusation during trial, which was completed in June 2008. ASARCO is seeking to recover more than $10,500,000,000, from Americas Mining and Grupo Mexico in the form of the return of its SPCC Shares and $1,700,000,000 in dividends Americas Mining has collected from SPCC. As of August 28, 2008, shares of SCC Common Stock trades at $26.17 per share. About 883,410,150 shares of SCC common stock were outstanding as of June 30, 2008. On June 19, 2008, SCC declared a three-for-one split of the Company Common stock. For the quarter ended June 30, 2008, Grupo Mexico reported $9,837,221,000 of assets and $4,719,900,000 of debts. The report said Grupo Mexico's common stock reached a 16-month low on August 12, mainly because of uncertainty over the bankruptcy case and a yearlong strike at its mine in Cananea, Mexico. "It would be a very bad situation -- the worst, worst scenario" for the parent company to lose in both courts, analyst Rodrigo Heredia of IXE Grupo Financiero told Bloomberg. "It would be a surprise" if Grupo lost the suit, Mr. Heredia added. During the June 2008 trial, Bloomberg related that, before the transfer of the SCC Stock, Grupo Mexico failed to persuade a financial consultant to verify ASARCO LLC's solvency. That amounted to "damning" evidence against Grupo Mexico, Charles Tatelbaum, Esq., at Adorno & Yoss, in Fort Lauderdale, Florida, told Bloomberg. Mr. Tatelbaum is not involved in the litigation but has represented creditors in the Enron Corp. and WorldCom Inc. bankruptcies. Grupo Mexico "has a very significant problem" if ASARCO LLC presented the facts accurately, Mr. Tatelbaum further told Bloomberg. Grupo Mexico's shares would be hurt should the company lose both court battles, Morgan Stanley analyst Carlos De Alba said in an interview with Bloomberg. The market doesn't expect a double loss, he said. About ASARCO LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since April 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006. (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Debtors submitted to the Court a joint plan of reorganization and disclosure statement on July 31, 2008. As reported by the Troubled Company Reporter on August 28, 2008, Americas Mining Corporation, an affiliate of Grupo Mexico SAB de CV, submitted a reorganization plan to retain its equity interest in ASARCO LLC, by offering full payment to ASARCO's creditors in connection with ASARCO's Chapter 11 case. AMC would provide up to $2.7 billion in cash as well as a $440 million guarantee to assure payment of all allowed creditor claims, including payment of liabilities relating to asbestos and environmental claims. AMC's plan is premised on the estimation of the approximate allowed amount of the claims against ASARCO. Asarco Inc. and AMC are represented by Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York. Sander L. Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, APC, in Dallas, Texas, represents the Asarco Asbestos Subsidiary Committee. (ASARCO Bankruptcy News, Issue No. 81; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: U.S. Trustee Appoints Asbestos Creditors Committee -------------------------------------------------------------- The U.S. Trustee for Region appointed 14 members of the Official Committee of Asbestos Claimants pursuant to Section 1102(a) and 1102(b)(1) of the U.S. Bankruptcy Code. The Asbestos Committee is comprised of members of the Official Committee of Unsecured Creditors for the Subsidiary Debtors and three additional members. The Asbestos Committee members are: 1. Barbara Zondervan c/o Robert Phillips Simmons Cooper, LLC 707 Berkshire Boulevard P.O. Box 521 East Alton, IL 62024 Tel No.: (618) 259-2222 Fax No.: (618) 259-2251 2. Thomas Brown c/o Ryan A. Foster Ryan A. Foster Law Firm 440 Louisiana Street, Suite 2100 Houston, TX 77002 Tel No.: (713) 236-2900 Fax No.: (713) 236-0566 3. Melvin Eldon Boggs c/o Steve Baron and Natalie Duncan Baron & Budd, P.C. 3102 Oak Lawn Avenue, Suite 1100 Dallas, TX 75219 Tel No.: (214) 521-3605 Fax No.: (214) 520-1181 4. Kenna Hall Terrel c/o Steven Kazan Kazan McClaim Abrams Fernandez Lyons & Farrise 171 Twelfth Street, Suite 300 Oakland, CA 94607 Tel No.: (510) 302-1000 Fax No.: (510) 835-4913 5. Robert H. Lawhorn c/o Charles Finley William Kherkher Hart Boundas, LLP (f/k/a Williams Bailey) 8441 Gulf Freeway, Suite 600 Houston, TX 77017 Tel No.: (713) 230-2200 Fax No.: (713) 643-6226 6. Benito T. Caceres c/o Eric Bogdan The Bogdan Law Firm 8866 Gulf Freeway, Suite 515 Houston, TX 77017 Tel No.: (713) 378-9378 Fax No.: (713) 378-9379 7. James Bailey c/o Brian Blevins Provost Umprey Law Firm 490 Park Street Beaumont, TX 77704 Tel No.: (409) 835-6000 Fax No.: (409) 838-8888 8. Robert Ryan c/o Christina Skubic Brayton Purcell 222 Rush Landing Road Novato, CA 94948 Tel No.: (415) 898-1555 Fax No.: (415) 898-1247 9. Timothy Crisler c/o Lou Thompson Black Brent Coon and Associates Weslayan Tower 24 East Greenway Plaza, Suite 725 Houston, TX 77046 Tel No.: (713) 840-0380 Fax No.: (713) 840-0702 10. Myra Meiers c/o Thomas W. Bevan Bevan & Associates, LPA 10360 Northfield Road Northfield, OH 44067 Tel No.: (330) 467-8571 Fax No.: (330) 467-4493 11. Samuel Cox c/o Thomas M. Wilson Kelly & Ferraro, LLP 2200 Key Tower 127 Public Square Cleveland, OH 44114 Tel No.: (216) 575-0777 Fax No.: (216) 575-0799 12. Gary Ellis c/o Robert Phillips Simmons Cooper, LLC 707 Berkshire Boulevard P.O. Box 521 East Alton, IL 62024 Tel No.: (618) 259-2222 Fax No.: (618) 259-2251 13. Elizabeth Scanlon c/o Robert Phillips Simmons Cooper, LLC 707 Berkshire Boulevard P.O. Box 521 East Alton, IL 62024 Tel No.: (618) 259-2222 Fax No.: (618) 259-2251 14. Rory Lewis c/o Christina Skubic Brayton Purcell 222 Rush Landing Road Novato, CA 94948 Tel No.: (415) 898-1555 Fax No.: (415) 898-1247 About ASARCO LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since April 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006. (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Debtors submitted to the Court a joint plan of reorganization and disclosure statement on July 31, 2008. As reported by the Troubled Company Reporter on August 28, 2008, Americas Mining Corporation, an affiliate of Grupo Mexico SAB de CV, submitted a reorganization plan to retain its equity interest in ASARCO LLC, by offering full payment to ASARCO's creditors in connection with ASARCO's Chapter 11 case. AMC would provide up to $2.7 billion in cash as well as a $440 million guarantee to assure payment of all allowed creditor claims, including payment of liabilities relating to asbestos and environmental claims. AMC's plan is premised on the estimation of the approximate allowed amount of the claims against ASARCO. Asarco Inc. and AMC are represented by Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York. Sander L. Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, APC, in Dallas, Texas, represents the Asarco Asbestos Subsidiary Committee. (ASARCO Bankruptcy News, Issue No. 80; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASHTON WOODS: Moody's Lowers Rating of Sr. Subor. Notes to Caa3 --------------------------------------------------------------- Moody's Investors Service lowered the ratings of Ashton Woods USA, LLC, including its corporate family rating to Caa2 from B3, its probability of default rating to Caa2 from B3, and the rating on its senior subordinated notes to Caa3 from Caa2. The outlook remains negative. The downgrade was prompted by the company's failure to comply with the tangible net worth, leverage ratio, and land inventory ratio covenants under its revolving credit facility as of the fiscal year ended May 31, 2008 as noted in the company's Aug. 22, 2008 8k SEC filing. As a result of non-compliance, Ashton Woods is in technical default under the facility and will be prohibited from making interest or principal payments on its $125 million Senior Subordinated notes due 2015 until an amendment or waiver is granted by the senior lenders. Further exacerbating the situation, Ashton Woods' approximately $58.7 million of tangible net worth at the end of its May fiscal year was below the $60 million minimum required by its bond indenture. If tangible net worth remains below $60 million for the quarter ending Aug. 31, 2008, as is currently anticipated, the company will be in technical default under its bond indenture and will need to seek a resolution. Specifically, the indenture requires the company to repurchase 10% of its outstanding subordinated notes. However, because of Ashton Woods' non-compliance under the credit facility, it is currently prohibited from repurchasing the notes -- as well as making the scheduled semi-annual interest payment due on Sept. 30, 2008 -- without a waiver. As a result, other possible cures may need to be considered. The negative outlook reflects: 1) the uncertainty surrounding the Ashton Woods' ability to successfully negotiate an amendment or waiver with both its lending group and bondholders in order to cure the technical defaults; 2) the expectation that the macro housing environment will remain unsupportive well into 2009, with any recovery likely to be very measured at first, thus prolonging the company's under performance on key financial metrics vs. prior expectations; and 3) the company's relatively small size and scale and somewhat limited geographic, product and price point diversity, which exacerbate the risk of localized down cycles. These ratings were affected: -- Probability of Default Rating lowered to Caa2 from B3; and -- Senior Subordinated Notes, lowered to Caa3 (LGD-5, 87%) from Caa2 (LGD-5, 87%). Begun in 1989, headquartered in Roswell, Georgia, and privately- owned by six Canadian families, Ashton Woods builds single-family detached homes, townhomes, and stacked-flat condominiums, with operations in seven U.S. cities. Revenues and net income in fiscal 2008 were approximately $408.1 million and ($113.5) million, respectively. ASHTON WOODS: KPMG LLP Raises Going Concern Doubt ------------------------------------------------- KPMG LLP in Atlanta, Georgia, expressed substantial doubt about Ashton Woods USA LLC's ability to continue as a going concern after it audited the company's financial statements for the years ended March 31, 2008 and 2007. The auditing firm pointed out that company defaulted certain covenants under its senior credit facility, as amended, and was below the required tangible net worth level contained in the subordinated notes. At May 31, 2008, the company's consolidated balance sheets showed total assets of $260,097,000 and total debts of $200,968,000, resulting in a stockholders' equity of $58,699,000. The company reported a $113,527,000 in net loss on home sales of $376,814 for the year ended May 31, 2008, compared to a $24,683,000 in net income on home sale of $572,166 for the same period a year earlier. A full-text copy of the regulatory filing is available for free at http://ResearchArchives.com/t/s?3184 Headquartered in Atlanta, Georgia, Ashton Woods USA L.L.C. is a homebuilder with operations in Atlanta, Dallas, Houston, Orlando, Phoenix, Denver and Tampa. AVADO BRANDS: Wants $6.5 Million KPMG-Sidley Agreement Approved --------------------------------------------------------------- Avado Brands Inc and its debtor-affiliates ask the United States Bankruptcy Court for the District of Delaware for permission to approve a proposed settlement with KPMG LLP and Sidley Austin LLP. A hearing is set for Sept. 16, 2008, at 10:30 a.m., ET, to consider approval of the Debtors' motion. Objections, if any, are due Sept. 9, 2008. On April 20, 2005, the Debtors initiated a litigation in the State Court of Fulton County, Georgia, against the two firms after the promotion and sale by the firms to the Debtors of a tax shelter investment -- Offshore Portfolio Investment Strategy -- which was subsequently determined by the Internal Revenue Services as fraudulent tax shelter. The Debtors alleged, among other things, that the OPIS transaction resulted in dire financial consequences to the Debtors including a tax liability to the IRS. Under the settlement agreement, the firms will pay the Debtors $6.5 million and execute a mutually-agreeable stipulation of dismissal. In turn, the Debtors will release the firms to the litigation and will discharge the Debtors from any and all claims as well as unknown claims. Furthermore, the agreement provides for a collateral carve-out from the liens of the Debtors' prepetition lender, DDJ Capital Management LLC, in the amount equal to 15% of the net recoveries of the litigation. A full-text copy of the Debtors and firms' settlement agreement dated Aug. 26, 2008, is available for free at: http://ResearchArchives.com/t/s?3186 About Avado Brands Madison, Georgia-based Avado Brands Inc., aka Applesouth, -- http://www.avado.com/-- operates about 120 casual dining restaurants under the banners Don Pablo's Mexican Kitchen and Hops Grillhouse & Brewery. The restaurants are located in 22 states in the U.S. As of Sept. 5, 2007, the Debtors employed about 9,970 people. For the year ended July 31, 2007, the Debtors generated about $227.8 million in revenues and a negative EBITDA of $7.8 million. The Debtor filed for chapter 11 protection on Feb. 4, 2004 (Bankr. N.D. Tex. Case No. 04-1555). On April 26, 2005, Judge Steven Felsenthal confirmed Avado's Modified Plan of Reorganization and that Plan became effective on May 19, 2005. On Sept. 5, 2007, Avado filed a voluntary chapter 22 petition (Bankr. D. Del. Case No. 07-11276) to complete an orderly sale of its assets, via Section 363 of the Bankruptcy Code. About 10 of Avado's affiliates also filed for bankruptcy protection on the same date (Bankr. D. Del. Case Nos. 07-11277 through 07-11286). Michael Tuchin, Esq., and Stacia A. Neeley, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP, represent the Debtors. Donald J. Detweiler, Esq., at Greenberg Traurig, LLP, is the Debtors' local counsel. Kurtzman Carson Consultants LLC acts as the Debtors' claims and noticing agent. The U.S. Trustee for Region 3 has appointed creditors to serve on an Official Committee of Unsecured Creditors to this cases. Greenberg Traurig LLP represents the Committee. In their second filing, the Debtors disclosed estimated assets and debts between $1 million and $100 million. BANC OF AMERICA: Fitch Affirms Ratings on BACM Series 2007-2 ------------------------------------------------------------ Fitch Ratings has affirmed Banc of America Commercial Mortgage Securities, Inc.'s mortgage pass-through certificates, series 2007-2, as: -- $49.8 million class A-1 at 'AAA'; -- $753 million class A-2 at 'AAA'; -- $55 million class A-2FL at 'AAA'; -- $162.6 million class A-3 at 'AAA'; -- $61 million class A-AB at 'AAA'; -- $602 million class A-4 at 'AAA'; -- $528.1 million class A-1A at 'AAA'; -- $317.3 million class A-M at 'AAA'; -- $153.8 million class A-J at 'AAA'; -- $100 million class A-JFL at 'AAA'; -- Interest only class XW at 'AAA'; -- $15.9 million class B at 'AA+'; -- $47.6 million class C at 'AA'; -- $31.7 million class D at 'AA-'; -- $15.9 million class E at 'A+'; -- $27.8 million class F at 'A'; -- $27.8 million class G at 'A-'; -- $43.6 million class H at 'BBB+'; -- $35.7 million class J at 'BBB'; -- $35.7 million class K at 'BBB-'; -- $15.9 million class L at 'BB+'; -- $7.9 million class M at 'BB'; -- $15.9 million class N at 'BB-'; -- $4 million class O at 'B+'; -- $4 million class P at 'B'; -- $11.9 million class Q at 'B-'. The $39.7 million class S is not rated by Fitch. The rating affirmations are the result of stable performance since issuance in June 2007. As of the August 2008 remittance, the transaction has paid down 0.3% to $3.163 billion from $3.173 billion at issuance. Loan maturities range from 2011 to 2021 with 28.9% of the pool scheduled to mature in 2012. Fitch has identified 11 Loans of Concern (4.1%), six of which are specially serviced (2.1%). Potential losses would be absorbed by the non-rated class S. The largest specially serviced asset (0.7%) is a 258-unit multifamily property in Las Vegas, Nevada. The loan is 60+ days delinquent and the borrower indicated that the delinquency is due to an increase in vacancy and expenses. The second largest specially serviced asset (0.6%) is secured by an office building in Eagan, Minnesota. The property serves as the headquarters for Buffets Inc., which filed for bankruptcy in January 2008. According to the special servicer, Buffets has renegotiated their lease term and rate, but will remain in occupancy at the property. The third largest specially serviced loan (0.3%) is secured by a multifamily property located in Reno, Nevada. The property has suffered from a decline in occupancy and is 60+ days delinquent. At issuance, there were three loans in the top ten, One Park Avenue (5.9%), 575 Lexington (5.1%), and 200 West 57th Street (2.9%), that were in the process of stabilizing. While the loans continue to have servicer reported year-end 2007 debt-service coverage ratios (DSCR) less than 1.0 times, Fitch has reviewed the updated occupancy, reserve expenditure, and cash flow information for these loans and has determined that they are in-line with the stabilization schedule set forth at issuance. Fitch will continue to monitor these loans. The Harlem River Yard industrial/warehouse complex (0.9%) maintains its investment-grade shadow rating. Servicer reported weighted average occupancy as of year-end 2007 was 100% with a debt-service coverage ratio of 2.07x. BUSINESS ALLIANCE: A.M. Best Rates Financial Strength At B(Fair) ---------------------------------------------------------------- A.M. Best Co. placed the financial strength rating of B (Fair) and issuer credit rating of "bb" of Business Alliance Insurance Company (BAIC) in San Bruno, California under review with positive implications. These rating actions follow the recent filing of a Form A Information Statement with the California Department of Insurance by PSM Holding Corporation to obtain the common shares and ownership of BAIC, in partial settlement of a $40 million judgment against the company and its principal owners. Concurrently, the trustee for BAIC's parent company, National Farm Financial Corporation, has appealed the judgment against the company. The outcome of the appeal will not be known until late 2009. Public Service Mutual Insurance Company is the parent company of PSMHC, as well as the lead company of the Magna Carta Companies. Members of Magna Carta Companies include Paramount Insurance Company and Western Select Insurance Company. The ratings will remain under review until transfer of ownership is finalized, most likely before year-end 2008. At that time, A.M. Best likely will remove the company from under review following discussions with PSMHC's management regarding the new parent's plans for BAIC. The ratings of the Magna Carta Companies are unchanged by this transaction. CAVTEL HOLDINGS: Moody's Junks Two Senior 1st Lien Secured Loans ---------------------------------------------------------------- Moody's Investors Service downgraded CavTel Holdings, LLC.'s corporate family rating to Caa1 from B3, and the B3 rating of the Company's senior secured credit facilities to Caa1. The rating action concludes the review for a possible downgrade initiated on April 24, 2008. The ratings outlook is negative, as the Company still faces significant execution risks in its turnaround plan. In conjunction with the rating action, Moody's maintained the probability of default rating at Caa1, reflecting the rating agency's views that the risk of default over the next 12 months remains elevated despite the amendment the Company reached with its bank group in May. Moody's took these ratings action: Issuer: CavTel Holdings, LLC -- Corporate Family Rating downgraded to Caa1, from B3 -- Probability of Default Rating confirmed Caa1 -- Senior 1st lien secured Revolving Credit Facility Due 2011 downgraded to Caa1, LGD3 - 47%, from B3, LGD3 - 32% -- Senior 1st lien secured Term Loan Due 2012 downgraded to Caa1, LGD3 - 47%, from B3, LGD3 - 32% -- Outlook is negative The downgrade was based on Cavalier's continuing operational challenges in integrating TalkAmerica Holdings, which Cavalier acquired in December 2006, and the highly competitive environment in Cavalier's markets. The weaker sales to residential and commercial customers, the high churn of residential customers and the related bad debt expenses have all contributed to poor cash flow performance. In addition, Moody's believes that a likely turnaround may take over one year to materialize given the lead time needed for the revamped sales force to work into full productivity, and new products to filter through the Company's pipeline. Moody's recognizes the actions that the Company has taken to solidify its business plan going forward, including supplementing its senior management team, rationalizing its wholesale, residential and business sales strategies and efforts to improve churn levels across all business lines. However, while Cavalier projects to have adequate liquidity over the next twelve months, Moody's notes that the cash position and covenant cushion may quickly erode if the revenue and EBITDA declines are not stabilized by the end of 2008. Moody's notes that Cavalier continues to realize cost synergies from the integration of Talk America, and may have flexibility to slow its capital spending to preserve liquidity and generate positive free cash flow in 2008, as the ongoing dislocation in the capital markets will likely prevent the company from raising capital needed for growth. However, significant capex conservation may starve the Company's long term sales growth potential and hinder its ultimate turnaround. In Moody's view, given the history of rapid deterioration of enterprise value of CLECs operating in default, the potential recovery to Cavalier's creditors would be lower than historic averages for all-bank corporate credits under the guidelines in Moody's loss given default methodology. Therefore, Moody's raised the expected loss estimate for Cavalier to 50% from 35%. Richmond, VA, based Cavalier is a competitive local exchange carrier servicing approximately 570,000 access lines. CBA COMMERCIAL: Fitch Takes Various Rating Actions on CBA 2006-2 ---------------------------------------------------------------- Fitch downgrades CBA Commercial Assets, LLC small balance series 2006-2 as: -- $1.1 million class M-5 to 'B-' from 'B'. In addition, Fitch places the following class on Rating Watch Negative: -- $2.3 million class M-4 at 'BB-'. Fitch also affirms these classes: -- $94.2 million class A at 'AAA'; -- interest only class X-1 at 'AAA'; -- $3.8 million class M-1 at 'AA'; -- $4.9 million class M-2 at 'A-'; -- $2.8 million class M-3 at 'BBB-'. Classes M-6, M-7, and M-8 are not rated by Fitch. The downgrade and Rating Watch placement is the result of additional specially serviced loans and increased loss expectations since Fitch's last rating action in March 2008. Fitch expects losses to deplete the non-rated classes M-8, M-7 and impact class M-6; thus reducing current credit enhancement levels. As of the August 2008 distribution date, the pool's aggregate collateral balance has been reduced 13% to $113.9 million from $130.5 million at issuance. There are currently 251 loans remaining with a weighted average loan size of $453,949. Twenty-three loans (10.3%) are currently in special servicing. Fitch expects losses on 19 (8.1%) of the 23 loans. The largest specially serviced loan (3%) is secured by a multifamily property located in Kansas City, MO and is 90 days delinquent. The special servicer has initiated foreclosure and appointed a receiver. The second largest specially serviced loan (1%) is secured by an industrial property located in Lake City, Florida and is more than 90 days delinquent. The special servicer is currently is proceeding with foreclosure and placement of a receiver. Fifteen loans (5.7%) are currently on the master servicer's watchlist for declines in performance, forced placed insurance, principal, and interest and escrow delinquencies. Per the Pooling and Servicing Agreement, loans with a current unpaid principal balance over $2 million are required to be transferred to special servicing at 60 days past due. However, loans with current outstanding balances below $2 million are not required to transfer to the special servicer until they are 120 days past due. Fitch will continue to monitor the performance of these loans for any further declines. CHA HAWAII: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: CHA Hawaii LLC 9342 E. Central Avenue Wichita, KS 67206 Bankruptcy Case No.: 08-12027 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Hawaii Medical Center East LLC 08-12030 Hawaii Medical Center West LLC 08-12032 Hawaii Medical Center LLC 08-12033 Type of Business: The Debtors run a health care business. Chapter 11 Petition Date: August 29, 2008 Court: District of Delaware (Delaware) Debtor's Counsel: Laura Davis Jones, Esq. Pachulski Stang Ziehl & Jones LLP 17th Floor, 919 N. Market Street Wilmington, DE 19899-8705 Tel (302) 652-4100 Fax 302-652-4400 Email ljones@pszjlaw.com Estimated Assets: $1 million to $10 million Estimated Debts: $50 million to $100 million The Debtors don't have any creditors who are not insiders. CISTERA NETWORKS: Farmer Fuqua Raises Going Concern Doubt --------------------------------------------------------- Farmer, Fuqua & Huff, P.C., in Plan, Texas, raised substantial doubt on Cistera Networks Inc.'s ability to continue as a going concern after it audited the company's financial statements for the years ended March 31, 2008, and 2007. The auditing firm pointed out that the company has suffered recurring losses from operations and has a net capital deficit. On Nov. 12, 2007, auditing firm Robinson Hill & Co. in Salt Lake, Utah, cited the company's recurring losses from operations and net capital deficit that raise substantial doubt about the company's ability to continue as a going concern. At March 31, 2008, the company's consolidated balance sheet showed total assets of $3,051,649 and total debts of $5,872,649, resulting in stockholders' deficit of $2,821,045. Moreover, its consolidated balance sheet also showed strained liquidity with $673,020 in total current assets available to pay $3,695,288 in total current liabilities. The company reported a $5,252,420 net loss on total revenues of $2,874,615, compared to a $2,051,338 net loss on total revenues of $1,932,838 for the same period a year earlier. A full-text copy of the company's regulatory filing with the Securities and Exchange Commission is available for free at: http://ResearchArchives.com/t/s?3185 Based in Dallas, Cistera Networks Inc. (OTC BB: CNWT.OB) -- http://www.cistera.com/-- works within the IT industry, specifically the field of unified communications. Cistera provides converged application platforms for the enterprise that enhances the investment in IP Telephony. CLEARLY CANADIAN: Reports $2 Mil. Net Loss in Qtr. Ended June 30 ---------------------------------------------------------------- Clearly Canadian Beverage Corporation reported a net loss of $2,046,000, on sales of $2,534,000, for the first quarter ended June 30, 2008, compared with a net loss of $5,680,000, on sales of $7,303,000, in the same period in 2007. At June 30, 2008, the company's consolidated balance sheet showed $16,450,000 in total assets, $9,147,000 in total liabilities, and $1,567,460 in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2008, are available for free at http://ResearchArchives.com/t/s?3181 About Clearly Canadian Based in Vancouver, B.C., Clearly Canadian Beverage Corporation (OTC BB: CCBEF.OB CL) -- http://www.clearly.ca/-- markets premium alternative beverages, including Clearly Canadian(R) sparklingflavoured waters and Clearly Canadian dailyEnergy, dailyVitamin and dailyHydration Natural Enhanced Waters which are distributed in the United States, Canada and various other countries. Clearly Canadian's recent acquisition of DMR Food Corporation and My Organic Baby Inc. marks the company's debut into organic and natural products with a full line of organic baby and toddler foods under the brand names My Organic Baby and My Organic Toddler and a wide range of dried fruit and nut snacks offerings from SunRidge Farms, Naturalife, Sweet Selections, Simply by Nature and Glengrove Organics brands. CLICKABLEOIL.COM: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Clickableoil.com, Inc. 2 Madison Avenue Larchmont, NY 10538 Bankruptcy Case No.: 08-23253 Type of Business: The Debtor sells heating oil. See: http://www.clickableoil.com/ Chapter 11 Petition Date: August 29, 2008 Court: Southern District of New York (White Plains) Judge: Adlai S. Hardin Jr. Debtor's Counsel: Anne J. Penachio, Esq. (Apenachio@lowey.com and annepena@aol.com) Lowey Dannenberg Cohen, P.C. One North Broadway, Fifth Floor White Plains, NY 10601 Tel: (914) 997-0500 Fax: (914) 997-0035 http://lowey.com/ Estimated Assets: $100,000 to $500,000 Estimated Debts: $1 million to $10 million A list of the Debtor's largest unsecured creditors is available for free at: http://bankrupt.com/misc/nysb08-23253.pdf DAIRYLAND HAY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Dairyland Hay Co., Inc. 6660 Riverside Drive Chino, CA 91710-9071 Bankruptcy Case No.: 08-21385 Chapter 11 Petition Date: August 29, 2008 Court: Central District of California (Riverside) Judge: Meredith A. Jury Debtor's Counsel: Stephen R Wade, Esq. (dp@srwadelaw.com) The Law Offices of Stephen R. Wade 400 N. Mountain Ave., Ste. 214B Upland, CA 91786 Tel: (909) 985-6500 Fax: (909) 985-2865 Estimated Assets: $1 million $10 million Estimated Debts: $1 million $10 million A list of the Debtor's largest unsecured creditors is available for free at: http://bankrupt.com/misc/califcb08-21385.pdf EAGLETAIL BIGHORN: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Eagletail Bighorn LLC 6028 N. 129th Ave. Litchfield Park, AZ 85340 Bankruptcy Case No.: August 29, 2008 Chapter 11 Petition Date: August 29, 2008 Court: District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtor's Counsel: James E. Cross Osborn Maledon P.A. 2929 N. Central Ave. #2100 Phoenix, AZ 85012 Tel (602) 640-9307 Fax 602-664-2077 Email jcross@omlaw.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of its largest unsecured creditors. FIRST AMERICAN: Fitch Affirms BB Rating on Trust Pref. Securities ----------------------------------------------------------------- Fitch Ratings affirmed and removed the Rating Watch Negative from the ratings of First American Corporation and its insurance operating subsidiaries, as: First American Corporation -- Issuer Default Rating at 'BBB'; -- Senior unsecured debt at 'BBB-'. First American Capital Trust -- Trust preferred securities at 'BB+'; First American Insurance Companies -- Insurer Financial Strength at 'A-'. The Rating Outlook is Negative. On April 10, 2008, Fitch lowered all ratings of FAF one notch to their current levels and placed the ratings on Rating Watch Negative. The rating actions taken on April 10th reflected the significant deterioration in First American's Risk Adjusted Capital as modeled by Fitch. Further, the Rating Watch was tied to management's evaluation of capital at First American given the potential spin-off of the title and specialty insurance operations which was scheduled to be a third quarter event but has now been delayed to 2009. During the second quarter of this year, FAF contributed to First American Title Insurance Company $200.5 million. The transfer consisted of $166.8 million in cash, marketable securities of $13.7 million, and a secured note of $20 million. This increase in surplus coupled with a pro forma decline of approximately 20% in operating expenses increases First American's 2008 pro forma RAC score to a range of 105%-115% from a 2007 RAC score of 74%. While Fitch recognizes the improvement in capital, both on an absolute and a risk adjusted measure, the agency notes that relative to peers First American continues to underperform. The current Negative Outlook is indicative of the negative trends not only in First American's capital, but also reserve levels and profitability. Fitch will review the company's performance over the next twelve to eighteen months to determine if the company's credit profile is consistent with the current rating level. If Fitch concludes that the company is operating in a manner inconsistent with its current rating category Fitch would likely lower the ratings one to two notches. Fitch removes from Rating Watch Negative and affirms these. The Rating Outlook is Negative. The First American Corporation -- IDR at 'BBB'; -- Senior debt at 'BBB-'; -- $200 million senior unsecured notes 2014 at 'BBB-'; -- $100 million senior unsecured debentures due 2028 at 'BBB-'. First American Capital Trust -- $100 million trust preferred security due 2012 at 'BB+'. Fitch affirms these IFS ratings at 'A-'. The Rating Outlook is Negative. -- First American Title Insurance Company -- First American Title Insurance Co. of New York -- First American Title Insurance Co. of Oregon -- First American Title Insurance Co. of North Carolina -- First American Title Insurance Co. (UK) PLC. -- Land Title Insurance Co. of St. Louis -- Ohio Bar Title Insurance Co. -- Port Lawrence Title & Trust Co. -- Mortgage Guaranty & Title Co. -- Massachusetts Title Insurance Co. -- Western National Title Insurance Company -- United General Title Insurance Co. -- Pacific Northwest Title Ins Co. -- Censtar Title Ins Co. -- T.A. Title Ins Co. -- First American Title Ins Co. of KS FLIGHT SAFETY: Wolf & Company Raises Going Concern Doubt -------------------------------------------------------- Wolf & Company, P.C. raised substantial doubt about Flight Technologies Inc.'s ability to continue as a going concern after auditing the financial statements of the company for the fiscal year ended May 31, 2008. The company experienced recurring losses from operations that have diminished its financial resources. The company's liquidity to date has primarily been provided by revenue from government contracts and proceeds from the sale of its equity securities. In addition, its funded contract backlog for its SOCRATES Phase IV Contract has been $0 since Dec. 31, 2006. As of May 31, 2008, the company's cash and investments were $1,002,899. The company expects that it will fund a substantial portion if not all of its operating expense and technology development costs from our own cash and investments. However, its own resources are limited and are not sufficient to complete the research, development and testing that is necessary to commercialize any of its technologies. Furthermore, the company's cash and investment account balance as of May 31, 2008, will be insufficient to fund its operations through the current year. Its inability to obtain further government or private funding for research, development and testing of its technologies would have a material adverse affect upon its financial condition and its ability to maintain operations. These factors raise substantial doubt about its ability to continue as a going concern. At May 31, 2008, Flight Technologies' balance sheets showed total assets of $1,265,276, and total debts of $477,313, resulting in a stockholders' equity of $787,963. The company posted a net loss of $3,286,299 on contract revenues of $336,995 for the year ended May 31, 2008, as compared with a net loss of $2,788,386 on contract revenues of $1,546,857 in the prior year. About Flight Safety Technologies Inc. Based in Mystic, Connecticut, Flight Safety Technologies Inc. -- http://www.flysafetech.com/-- (AMEX:FLT) is engaged in developing technologies that enhances aviation safety and efficiency. These technologies include Aircraft Wake Safety Management, Sensor for Optically Characterizing Ring-eddy Atmospheric Turbulence Emanating Sound, Universal Collision Obviation and Reduced Near- Miss and Tactical Integrated Illumination Countermeasure Technology. FORD MOTOR: District Court Approves VEBA Health Care Trust Fund --------------------------------------------------------------- The Detroit Free Press reports that U.S. District Court Judge Robert Cleland in Detroit approved, on Friday, the creation of the Voluntary Employee Beneficiary Association, an indendent union- controlled trust fund for Ford Motor Company employees. Ford will be turning over to the United Auto Workers union retiree health care obligations. According to a UAW Report, Ford agreed to fund the VEBA in a manner sufficient to provide benefits at current levels on a lifetime basis for current and future retirees, based on reasonable projections. The Detroit Free Press, relates that the ruling indicated that Ford, together with General Motors Corp. and Chrysler LLC, can make a go at the funds. Judge Cleland approved GM's VEBA on July 31, and Chrysler's on August 4. The UAW Report recounts that Ford's VEBA trust pays benefits beginning Jan. 1, 2010. In order to secure long-term funding for retiree health care, Ford will continue to pay for retiree health care directly until 2010 (at a cost of roughly $ 2.2 billion), and also contribute $13.2 billion in cash and securities to the independent VEBA trust. According to The Wall Street Journal, Ford vowed in August to continue operating three former Visteon Corp. plants beyond 2008 as it attempts to find buyers in an ever-tightening market. Ford took back 17 factories and facilities back from Visteon, its financially struggling parts supplier and former subsidiary. The Journal said the plants were placed in the Automotive Components Holdings unit created by Ford in October 2005. To date, the unit has sold five plants, will close three this year and has nonbinding sale agreements on two other facilities, WSJ says. Separately, Ford Motor Credit told investors early in August that it is substantially scaling back the number of vehicles it expects to lease and warned that if market conditions continue to deteriorate, further losses could place Ford Credit's lending plan at further risk, the Journal says. According to the Journal, Jim Farley, Ford's global vice president for marketing and communications, said during a call with analysts, that "we are rebalancing our marketing incentives to really focus on retail [loans]. We've been actually doing that for several months and it has been very effective in rebalancing our portfolio." About Ford Motor Co Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin-American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter on Aug. 5, 2008, Fitch Ratings has downgraded the issuer default rating of Ford Motor Company and Ford Motor Credit Company LLC to 'B-' from 'B'. The Rating Outlook remains Negative. The downgrade reflects these: (i) the further deterioration in Ford's U.S. sales as a result of economic conditions, an adverse product mix and the most recent jump in gas prices; (ii) portfolio deterioration at Ford Credit and heightened concern regarding economic access to capital to support financing requirements; and (iii) escalating commodity costs that will remain a significant offset to cost reduction efforts. GENERAL MOTORS: Deserves $50BB Gov't-Backed Loans, Mr. Lutz Says ---------------------------------------------------------------- ABI World reports that General Motors vice chairman Robert A. Lutz said that automakers are "deserving" of as much as $50 billion in government-backed loans so that they can build more fuel-efficient cars. Mr. Lutz made the statement to reporters at an event near Chicago where G.M. showed off its 2009 lineup, according to Nick Bunkley of The New York Times. As reported by the Troubled Company Reporter on Aug. 26, 2008, the Big Three auto makers and their suppliers are now seeking significantly more help from the federal government. The Detroit Free Press reported earlier in August that top executives at Ford Motor Co., General Motors Corp., and Chrysler LLC had a meeting and decided to ask for financial aid from the feds. There is no consensus as to how much do auto executives want, people familiar with the talks say, according to The Wall Street Journal. But reports say it could be between $40 billion and $50 billion. The auto makers would like to have a funded plan in place by the end of 2008. The companies have already been authorized to receive $25 billion government-backed loans approved as part of an energy bill last year. The loans have yet to be funded. David Cole, president of the Center of Automotive Research in Ann Arbor, Mich., denied the funding is a bailout in its entirety, WSJ says. "This is actually more like the government acting like a banker as it begins to look at the major consequences of a major failure in the auto industry," he said. The current funding is reportedly aimed at making the Big Three more competitive. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. About Ford Motor Co Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin-American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter on Aug. 5, 2008, Fitch Ratings has downgraded the issuer default rating of Ford Motor Company and Ford Motor Credit Company LLC to 'B-' from 'B'. The Rating Outlook remains Negative. The downgrade reflects these: (i) the further deterioration in Ford's U.S. sales as a result of economic conditions, an adverse product mix and the most recent jump in gas prices; (ii) portfolio deterioration at Ford Credit and heightened concern regarding economic access to capital to support financing requirements; and (iii) escalating commodity costs that will remain a significant offset to cost reduction efforts. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. At March 31, 2008, GM's balance sheet showed total assets of $145,741,000,000 and total debts of $186,784,000,000, resulting in a stockholders' deficit of $41,043,000,000. Deficit, at Dec. 31, 2007, and March 31, 2007, was $37,094,000,000 and $4,558,000,000, respectively. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. GENOIL INC: Posts C$1.1MM Net Loss in 2008 1st Qtr. Ended June 30 ----------------------------------------------------------------- Genoil Inc. reported a net loss of C$1,133,718, on revenues of C$13,932, for the first quarter ended June 30, 2008, compared with a net loss of C$4,315,637, on zero revenues, in the same period in 2007. At June 30, 2008, the company's consolidated balance sheet showed C$5,300,680 in total assets, C$3,733,220 in total liabilities, and C$1,567,460 in total stockholders' equity. The company's consolidated balance sheet at June 30, 2008, also showed strained liquidity with $724,364 in total current assets available to pay C$3,586,315 in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2008, are available for free at http://ResearchArchives.com/t/s?3180 Going Concern Doubt As at March 31, 2008, the company had incurred accumulated losses of C$58,585,694 since inception. The company believes that its ability to continue as a going concern is in substantial doubt and is dependent on achieving profitable operations, commercialising its upgrader technology, and obtaining the necessary financing in order to develop this technology further. About Genoil Inc. Headquartered in Alberta, Canada, Genoil Inc. (OTC BB: GNOLF.OB) (CDNX: GNO.V) -- http://www.genoil.net/-- is an international engineering technology development company. The company specializes in heavy oil upgrading, process system optimization, development, engineering, design and equipment supply, installation, start up and commissioning of services to specific oil production, refining and related markets. Genoil has designed and developed the Genoil Hydroconversion Upgrader, an improved hydrogenation process that upgrades and increases the yields from high sulphur, acidic, heavy crude oils and heavy refinery feed stocks, bitumen and refinery residues into light, clean transportation fuels; and the Crystal Sea separator, a bilge water treatment system which has met the guidelines and standards of the United States Coast Guard and the International Maritime Organization's MEPC Resolution 107 (49) MEP for pollution prevention equipment for ship bilges. GREEKTOWN CASINO: Creditors Panel Balks at Oct. 31 Claims Bar Date ------------------------------------------------------------------ The Official Committee of Unsecured Creditors in Greektown Casino LLC and its debtor-affiliates' Chapter 11 cases opposes the Debtors' request to set Oct. 31, 2008, as the deadline for filing proofs of claim. As reported in the Troubled Company Reporter on Aug. 6, 2008, the Debtors asked the Court to establish Oct. 31, 2008, at 8:00 p.m., prevailing Eastern Time, as the deadline for all creditors, including individual, partnership, joint venture, corporation, estate, trust and governmental units, to file proofs of claim against them that arose before the date of bankruptcy. A meeting of creditors was held by the U.S. Trustee pursuant to Section 341 of the U.S. Bankruptcy Code on July 2, 2008. Pursuant to Local Rule 3003-1 of the Local Rules of Bankruptcy Procedure for the Eastern Michigan Bankruptcy Court, the last date for the filing of proofs of claim is set 90 days after the first date scheduled for the 341 Meeting. Thus, the Court generated a notice establishing Sept. 30, 2008, as the deadline to file a proof of claim. The Debtors, however, believe that it is in the best interest of all parties for the Court to establish Oct. 31, 2008, as the new claims bar date. The Debtors believe that such date will give all creditors, including governmental units, ample opportunity to prepare and timely file proofs of claim. Representing the Official Committee of Unsecured Creditors, Robert D. Gordon, Esq., at Clark Hill PLC, in Detroit, Michigan, says that Section 502(b) of the U.S. Bankruptcy Code provides that a proof of claim of a governmental unit will be timely filed if it is filed before 180 days after the petition date or at a later time as the Federal Rules of Bankruptcy Procedure may provide. Mr. Gordon contends that since the Oct. 31, 2008 Claims Bar Date proposed by the Debtors also covers governmental units and is only 155 days after the Petition Date, the Debtors' attempt to reduce the time period for governmental units to file proofs of claim is not authorized by the Bankruptcy Code. Since a notice fixing a general claims bar date has been previously been issued in the Debtors' cases, there should be a clarification in the Debtors' proposed order for the Claims Bar Date that the Order does not refer to the previous claims bar date notice of the Court and that the Order supersedes the previous notice, Mr. Gordon points out. The proposed Order also provides that the Bar Date is binding on unknown and known creditors. The Committee believes that this particular provision is inappropriate because unknown creditors who are not receiving actual or publication notices should not be bound by the Bar Date. Mr. Gordon adds that: -- the Claims Bar Date Notice is confusing and lacks clarity because some of the Notice's footnotes are incorrectly numbered and are vague in providing notice to claims holders under Section 503(b)(9) of the separate procedures established for submitting proofs of claim; and -- the Claims Bar Date Notice's provision of "apprising claimants that failure to comply with the Claim Filings Procedures will result in the claim being forever barred and discharges should" is also unclear and should be highlighted in bold lettering. The Committee suggests that various headings and subheadings should be inserted in the Claims Bar Date Notice to enable creditors to easily digest the information in the Notice and for the Debtors to make certain other organizational amendments to it. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC and its affiliates -- http://www.greektowncasino.com/-- operate world- class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC serves as the Debtors' claims, noticing, and balloting agent. When the Debtor filed for protection from its creditors, it listed consolidated estimated assets and debts of $100 million to $500 million. (Greektown Casino Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). GREEKTOWN CASINO: Can Hire Honigman Miller as Special Counsel ------------------------------------------------------------- Greektown Casino LLC and its debtor-affiliates obtained permission from the Honorable Walter Shapero of the U.S. Bankruptcy Court for the Eastern District of Michigan to employ Honigman Miller Schwartz and Cohn LLP as their special counsel. The Debtor's CFO, Clifford J. Vallier, told the Court that Honigman has served as the Debtors' general counsel since 2004 and the firm has provided the Debtors with a variety of prepetition legal services. He averred that the Debtors will need continuing legal representation during the duration of their Chapter 11 cases. The Debtors maintained that if Honigman could not continue to provide them services that are similar to the prepetition legal services the firm provided, they will incur large legal fees and delays in having another law firm learn the necessary facts and law in order to provide those services. Honigman Miller is expected to: (a) represent the Debtors in regulatory issues, including with the Michigan Gaming Board, in negotiations with Ted Gatzaros, an equity holder and secured lender, in financing issues, including relations with their secured lenders and bondholders, and on issues arising from the construction of their new casino/hotel building and its parking structures; (b) prepare the Debtors' s-4 registration statement and assisting in seeking an equity investor, including preparing a due diligence room; (c) address the issues of engaging an investment banker for a potential sale of the Debtors' assets; (d) negotiate, draft and analyze contracts; (e) provide labor, benefits, environmental, taxes and litigation services; (f) assist the Debtors, in connection with the possible sale of their assets or if they seek an equity investment, with the drafting and negotiating of confidentiality agreements, letters of intent, an asset purchase agreement and its schedules, and due diligence activities related to an asset sale or equity investment; (g) assist the Debtors in connection with the drafting a proposed disclosure statement. Honigman agreed to coordinate and work closely with the Debtors' proposed counsel, Schafer and Weiner PLLC, to ensure that there will be no duplication of services with Schafer. The Debtors will pay for Honigman's services in accordance with the firm's customary hourly rates: Professional Hourly Rate ------------ ----------- Partners $275 - $680 Associates $190 - $275 Legal Assistants $80 - $220 Judy B. Calton, Esq., a partner at Honigman, disclosed that the firm received a $300,000 retainer for services it is to render for the Debtors' benefit and as an advance against expenses to be incurred by the firm. Ms. Calton assured the Court that her firm does not hold or represent any interest materially adverse to the interest of the Debtors and their estates. She added that the firm is a "disinterested person" within the meaning of Section 101(14), as modified by Section 1107(b) of the U.S. Bankruptcy Code. As reported in the Troubled Company Reporter on June 30, 2008, Habbo G. Fokkena, the U.S. Trustee for Region 9, asked the Court to deny the Debtors' request to employ Honigman Miller as special counsel. The Trustee argued that the Honigman Application concedes the firm is not disinterested and could not qualify for employment as general counsel under Section 327(a) of the U.S. Bankruptcy Code. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC and its affiliates -- http://www.greektowncasino.com/-- operate world- class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08- 53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC serves as the Debtors' claims, noticing, and balloting agent. When the Debtor filed for protection from its creditors, it listed consolidated estimated assets and debts of $100 million to $500 million. (Greektown Casino Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). HEAVEN INVESTMENT: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Heaven Investment Holding Corp. 1401 El Camino Ave. No. 410 Sacramento, CA 95815 Bankruptcy Case No.: 08-32280 Type of Business: The Debtor is a real estate corporation. Chapter 11 Petition Date: August 29, 2008 Court: Eastern District of California (Sacramento) Judge: Thomas Holman Debtor's Counsel: Yasha Rahimzadeh 980 9th St. 16th Fl. PMB 1021 Sacramento, CA 95814 Tel (916) 337-8066 Total Assets: $21,120,000 Total Debts: $30,571,763 Debtors' List of 20 largest unsecured creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Malibu Recoventance LLC (JCRA) Mortgage $13,329,669 P.O. Box 4987 Value of security Chatsworth, CA 91311 - $13,000,000 Michael Samson $1,500,000 619 47th Ave. San Francisco, CA 94121 Al Stewart & Doug Jansen $700,000 13760 Tank Drive Pine Groove, CA 95665 Ozair Abdullah $555,000 18522 Pine View Square Leezburg, VA 20176 Bill &Carolyn Wilson Deed of Trust $530,000 6691 Gibson Canyon Rd. Value of Security - $600,000 Nazim Hashim $500,000 20332 Via Galileo Porter Ranch, CA 91326 Telgraph Garden Apts. $400,000 9646 West Vista Hillsboro, MO 63050 Olivia Raya $270,000 684 San Jose Ave. Ste. A San Francisco, CA 94110 Dolores LeBlue $200,000 Ed Sarna $190,000 Bimal Singh $190,000 Olga Biasiol $180,000 Jeff & Debbie Buchanan $165,000 Laila Bhamani $150,000 Marvin & Elena Booth $140,000 Tatyana Mironova $135,000 Brent Fredricksen $130,000 Harnesk Nijjar $125,000 Ferishta Kulaly $125,000 Anne Fisher $114,000 HICKORY HUT: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Hickory Hut, Inc. dba Old Town Grill & Bistro P.O. Box 64 Helotes, TX 78023 Bankruptcy Case No.: 08-52533 Type of Business: The Debtor runs a bistro. Chapter 11 Petition Date: August 30, 2008 Court: Western District of Texas (San Antonio) Judge: Leif M. Clark Debtor's Counsel: Dean William Greer, Esq. 2929 Mossrock, Suite 117 San Antonio, TX 78230 Tel: (210) 342-7100 Fax: (210) 342-3633 Email: dwgreer@sbcglobal.net Estimated Assets: $1 million to $100 million Estimated Debts: $1 million to $100 million Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Jeannie H. Pircher Loan $378,347 1445 CR 2615 Rio Medina, Texas 78066 Cattaro Investments LLC Loan $280,000 11445 2615 Rio Medina, TX 78066 United Managers Group, Inc. Loan $278,000 1445 Cr 2615 Rio Medina, TX 78066 Domaine Builders, LLC Services $200,000 1445 Cr 2615 Rio Medina, TX 78066 Ben E. Keith Supplies $17,570 P.O. 34810 San Antonio, TX 78265 John Bezdeck Insurance Insurance $10,000 Ifc Credit Corp Equipment Leasing $9,035 Frost Bank Trade Debt $8,707 State Comptroller of Public Ac Sales Taxes $8,000 U.S. Foodservice, Inc. Service $7,206 Sylvia S. Romo Property Taxes $7,034 Sysco Foods Supplies $6,177 Lupe Rubio Construction Co Inc Construction $4,000 Grey Forest Utilities Utilities $4,000 Pure Hart Production LLC Supplies $2,500 Coca Cola Bottling Company Supplies $2,277 City Public Service Electric $2,277 ASCAP Services $2,170 BMI Services $1,832 Blue Cross/Blue Shield Insurance $1,415 HOW COS: Deputy Receiver Sets Jan. 12, 2009 as Claims Bar Date -------------------------------------------------------------- Alfred W. Gross, deputy receiver appointed in the liquidation proceeding of Home Warranty Corporation, Home Owners Warranty Corporation, and How Insurance Company, established Jan. 12, 2009, as deadline by which all proofs of claim against the company should be filed. Claims must be submitted to: The Deputy Receiver Proof of Claim Department HOW Companies, in Receivership P.O. Box 1557 Tucker, Georgia 30085-1557 On June 13, 2008, the State Corporation Commission of the Commonwealth of Virginia entered its order approving plans of liquidation for the HOW Companies. The plan, among other things, authorized the deputy receiver to establish a bar date for claims including contingent or unliquidated claims. Claims filed after the claims bar date will be barred from sharing in the assets of the companies until timely approved claims are paid in full, unless these filed claims are exempt from the claims bar date. HOW Companies -- http://www.howcorp.com/-- marketed a home warranty insurance program before the inception of receivership proceedings. The program issued builder liability insurance policies and home owner warranty certificates, which provided coverage for at least 10 years to homes throughout the United States. IGNIS PETROLEUM: Names Geoff Evett as Acting CEO and Chairman ------------------------------------------------------------- Ignis Petroleum Group, Inc. disclosed that several changes have been implemented over the last 12 to 18 months, most notably its management structure. Geoff Evett now acts as CEO and Chairman of the company's Board of Directors. The four areas Mr. Evett has been concentrating his efforts on have been the restructuring of Ignis's capital structure, especially in view of the convertibles outstanding with the company's senior creditor, rationalizing the cost structure of the organization, assessment of the current project portfolio and, finally, the identification of new projects. Capital Structure Ignis and the company's senior creditor have executed a new agreement under which the conversion price of the debentures held has been fixed at $0.03. This is the first step in the recapitalization process for the company and one management deems imperative to start building shareholder value. Without the agreement, the overhang of the convertibles would be of an uncertain magnitude, effectively rendering further investment in the company a very tough prospect. With the agreement executed, the overhang is now quantifiable and allows for management to pursue further opportunities. The dialogue with the creditor is positive and constructive and Management expects further announcements to be made regarding the capital restructuring. The Troubled Company Reporter on Aug. 12, 2008, Ignis disclosed that on July 18, 2008, it executed a forbearance agreement with YA Global Investments, L.P. Under the terms of the agreement, Ignis has agreed to pay YA Global $55,000 monthly for the period of the forbearance agreement. YA Global has agreed to a restructuring of the debentures. Under the new agreement, the debentures have a fixed conversion price of $0.03. Cost rationalization Management has been downsized and many other costs the previous Management carried have been cut. As a result, Ignis is now generating a positive cash flow, enabling the organization to put in place its restructuring program. Projects The ACOM A6 well has been productive and has generated a positive cash flow for the company. The well is currently under a workover and production is anticipated to restart as soon as this is completed. Upon recommencement of production, the company will assess the feasibility of adding production capacity, both in terms of investment required and in terms of logistics capacity. The latter is of importance as the capacity to transport oil out of the area seems to be near full capacity at present. The project with W. B. Osborn Oil & Gas Operations to develop the field located in Montague and Cooke Counties, Texas, continues to progress and add to production. The project has recently reached breakeven and Silverpoint Capital, the capital provider for the project, has only now started to recoup its investment. The way the deal is structured is that Ignis will start earning its working interest once Silverpoint has recovered its original investment plus a certain return. Even though no revenues are accruing to Ignis from this project as yet, the fact that it has reached breakeven and has started to generate a positive cash flow has created definite value to the company. At present there are no exploration or exploitation activities at the Sherburne project as Management has decided that certain technicalities make the economic viability of the project too risky a prospect to pursue at present. The rights, however, have been retained. The Barnett Shale wells (unrelated to the WBO project) to date have proven unproductive and Management has decided to, for the time being, not engage in risky investments on this project. New Projects The Board of Directors has deemed the Liberty Hills project, which the company was pursuing, as not suitable for the Ignis portfolio. As a result, the company is now in a position to actively pursue new opportunities. Ignis is in discussions on a number of fronts. With its new management structure and contacts within industry, the company has the ability to engage the services of certain very highly regarded energy professionals to judge the merits of new projects. With the financial and business acumen of the Board, the Company is positive on the prospect of securing new and profitable projects that will create significant shareholder value. New projects will have to comply with strict criteria. There will be no wildcatting and projects with a high exploration risk will not be considered. Management prefers projects where proven reserves can be extended through targeted exploration or where new technologies can add significantly to the already established production flow. Furthermore, Management said it will assess the projects it currently holds a working interest in for production expansion. Mr. Evett, Chairman of the Board and CEO, stated, "We have done a lot of work these last [12] to [18] months in restructuring the organization and have put Ignis on a new footing, enabling us to actively pursue new opportunities. We now have the capital structure, management, industry connections and links to financial partners that will enable us to do so. Furthermore, we are cash flow positive, which allows us time to analyze properly new prospects. We are confident we have been and are doing what is needed to put value into Ignis, and I look forward to informing our shareholders on a more regular basis." About Ignis Petroleum Ignis Petroleum Group, Inc. -- http://www.ignispetro.com/-- is a Dallas-based oil and gas production company focused on exploration, acquisition and development of crude oil and natural gas reserve in the United States. The company's management has closely aligned itself with strategic industry partnerships and is building a diversified energy portfolio. It focuses on prospects that result from new lease opportunities, new technology and new information. INDYMAC BANCORP: Court Dumps Suit Against Bank, FDIC ----------------------------------------------------- ABI World reports that the Hon. John G. Koeltl of the U.S. District Court in Manhattan dismissed a lawsuit against IndyMac Bancorp Inc. and the Federal Deposit Insurance Corp. The suit alleges that IndyMac Bank hired appraisers who inflated home values so the bank could charge higher interest rates on home equity loans. Reuters' Martha Graybow says Virgen Cedeno accused IndyMac of concealing the nature of its relationship with outside appraisers, saying she was misled about the equity in her home because of an inflated appraisal of her home's value. Ms. Cedeno is a resident of Brooklyn, New York. According to Reuters says, the Plaintiff alleged she obtained an $80,000 line of credit from IndyMac secured by her property, and was charged a $500 appraisal fee. Judge Koeltl, according to Reuters, held that Ms. Cedeno failed to state adequate claims, and said her state law claims were pre- empted by federal law. The Court dismissed claims against IndyMac and the FDIC for alleged violations of the federal Real Estate Settlement Procedures Act and Truth in Lending Act, Reuters says. Reuters notes that the complaint sought class action status. About IndyMac Bancorp Based in Pasadena, California, IndyMac Bancorp Inc. (NYSE:IMB) -- http://www.indymacbank.com/-- is the holding company for IndyMac Bank, FSB, a hybrid thrift/mortgage bank that originated mortgages in all 50 states of the United States. Through its hybrid thrift- mortgage bank business model, IndyMac designed, manufactured, and distributing cost-efficient financing for the acquisition, development, and improvement of single-family homes. IndyMac also provided financing secured by single-family homes to facilitate consumers' personal financial goals and strategically invests in single-family mortgage-related assets. Indymac Bancorp filed for Chapter 7 bankruptcy protection on July 31, 2008 (Bankr. C.D. Calif., Case No. 08-21752). Representing the Debtor are Dean G. Rallis, Jr., Esq., and John C. Weitnauer, Esq. Bloomberg noted that Indymac had $32.01 billion in assets as of July 11, 2008. In court documents, IndyMac disclosed estimated assets of $50 million to $100 million and estimated debts of $100 million to $500 million. All of Indymac's business is conducted, and assets are held, within IndyMac Bank, F.S.B. On July 11, 2008, the Office of Thrift Supervision closed IndyMac Bank and appointed FDIC as the bank's receiver. Thacher Proffitt & Wood LLP was engaged as counsel to the FDIC. INTERNATIONAL RECTIFIER: Board Rejects Unsolicited Vishay Buyout ---------------------------------------------------------------- International Rectifier Corporation's board of directors unanimously determined that the unsolicited, non-binding proposal by Vishay Intertechnology, Inc. to acquire all of the outstanding shares of the company for $21.22 per share in cash is not in the best interests of the company and its shareholders. "[Vishay] is probably going to comeback with another offer or proposal," The Wall Street Journal quoted Argus Research analyst Jim Kelleher as saying. The Board reviewed the proposal with the assistance of Goldman, Sachs & Co., as financial; adviser, and Fried, Frank, Harris, Shriver & Jacobson LLP, as legal adviser. "Vishay's proposal significantly undervalues the Company and its future prospects when compared to the shareholder value realizable under our recently adopted strategic plan," Richard J. Dahl, chairman of the company's board said. "On Aug. 1, 2008, we announced that the Company had successfully completed the restatement process of prior financial periods. The Company has also added considerable strength and depth to its senior management team during the past year and is poised to enhance its competitive position in the marketplace. "The Board believes that the proposal by Vishay does not value the Company and its future prospects appropriately. In our judgment, IR shareholders will be better served by allowing management to move forward with its strategic plan. We believe that IR's valuation is still under the cloud of legacy issues. The Board and our management team look forward to executing the exciting opportunities available to our Company and to delivering this value to our shareholders," concluded Mr. Dahl. "We look forward to fulfilling our potential as we continue to follow our strategic plan and focus on long term value creation for our shareholders," Oleg Khaykin, Chief Executive Officer of the company added. The company delayed 2007 Annual Meeting of Stockholders will be held on Oct. 10, 2008, where the stockholders will elect the class one directors. The record date for the 2007 Annual Meeting is Sept. 19, 2008. About International Rectifier International Rectifier Corporation -- http://www.irf.com/-- (NYSE:IRF) is in the power management technology business. IR's analog, digital, and mixed signal ICs, and other advanced power management products enable high performance computing and save energy in a wide variety of business and consumer applications. IR's customers include manufacturers of computers, energy efficient appliances, lighting, automobiles, satellites, aircraft, and defense systems. * * * As reported in the Troubled Company Reporter on Aug. 21, 2008, Standard & Poor's Ratings Services said that its 'BB' corporate credit rating on El Segundo, Calif.-based International Rectifier Corp. (IR) would remain on CreditWatch with negative implications, where it was placed on April 9, 2007, because of an accounting investigation that prevented the company from filing financial statements. JOHN WOLFE: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: John Wolfe Auto Group, L.P. dba Wolfe Ford-Mercury Wolfe Dodge Chrysler Jeep 2803 Wilbarger Vernon, TX 76384 Bankruptcy Case No.: 08-70341 Type of Business: The Debtor is an auto dealer. Chapter 11 Petition Date: August 25, 2008 Court: Northern District of Texas (Wichita Falls) Judge: Harlin DeWayne Hale Debtor's Counsel: Edwin Paul Keiffer Wright Ginsberg Brusilow, PC 1401 Elm Street, Suite 4750 Dallas, TX 75202 Tel (214) 651-6517 Fax (214) 744-2615 Email pkeiffer@wgblawfirm.com Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million A list of the Debtor's largest unsecured creditors is available for free at http://bankrupt.com/misc/txnb08-70341.pdf KIMBALL HILL: BMO Capital Seeks to File Consolidated Claim ---------------------------------------------------------- Kimball Hill Inc. and its debtor-affiliates, and BMO Capital Markets, fka Harris Nesbitt Corp., agreed, in a Court-approved stipulation, that BMO may file one master proof of claim for its claims in connection with a certain purchase agreement between the parties. Prior to the date of bankruptcy, the Debtors and BMO Capital are parties to a Purchase Agreement in connection with the issuance by Kimball Hill, Inc., of 10-1/2% Senior Subordinated Notes in the principal aggregate amount of $203,000,000. BMO is the initial purchaser under the Purchase Agreement. BMO will be deemed to have filed individually a proof of claim in each of the Debtors' cases, upon filing the master proof of claim. The Stipulation does not intend to impair BMO's rights and obligations to file additional proof of claims with respect to any other claims against the Debtors. About Kimball Hill Based in Rolling Meadow, Illinois, Kimball Hill Inc. -- http://www.kimballhillhomes.com/-- is one of the largest privately-owned homebuilders and one of the 30 largest homebuilders in the United States, as measured by home deliveries and revenues. The company designs, builds and markets single- family detached, single-family attached and multi-family homes. The company currently operate within 12 markets, including, among others, Chicago, Dallas, Fort Worth, Houston, Las Vegas, Sacramento and Tampa, in five regions: Florida, the Midwest, Nevada, the Pacific Coast and Texas. Kimball Hill, Inc. and 29 of its affiliates filed for Chapter 11 protection on April 23, 2008 (Bankr. N.D. Ill. Lead Case No. 08- 10095). Ray C. Schrock, Esq., at Kirkland & Ellis LLP, represents the Debtors in their restructuring efforts. The Debtors' consolidated financial condition as of Dec. 31, 2007 reflected total assets of $795,473,000 and total debts $631,867,000. The Debtors have until Oct. 20, 2008, to exclusively file a bankruptcy plan. (Kimball Hill Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). KIMBALL HILL: Highland Wants Decision Made on Sales Contract ------------------------------------------------------------ Highland Six Twenty Residential, Ltd. asks the U.S. Bankruptcy Court for the Northern District of Illinois to compel Kimball Hill Inc. and its debtor-affiliates to immediately assume or reject a certain residential sales contract. Highland is a developer of residential construction projects, and is responsible for developing and constructing the basic infrastructure of a residential project before selling and conveying lots to custom homebuilders. Before the bankruptcy filing, the Debtors and Highland entered into a Sales Contract pursuant to which the Debtors agreed to buy and pay for 152 residential lots located at the Highland Horizon, Phase 1, a subdivision in Williamson County, Texas. Highland is in the process of constructing streets, water distribution, wastewater distribution system, sewer, and other improvements in the Highland Horizon subdivision. As further consideration for the Debtors' rights to purchase the lots and as earnest money for the contemplated purchase, the Debtors have placed with Highland an Irrevocable Standby Letter of Credit for $858,000, issued by their debtor-affiliate National Credit and Guaranty Corporation. Highland notes that National Credit's Schedules of Assets and Liabilities show no assets other than the $6,650,000 in intercompany receivables, with obligations in excess of $300,000,000. Craig H. Cavalier, Esq., in Houston, Texas, points out that the Debtors' financial commitment under the Contract total $8,580,000, plus interest, on account of covenants requiring them to: -- purchase or "take down" 40 of the 152 lots at a $2,000,000 initial cost upon substantial completion of the improvements expected by September 15, 2008. By that date, interest will begin to accrue; -- pay $1,000 for rights to purchase the designated lots; and -- purchase additional lots at the rate of 12 lots every 90 days, beginning 180 days after the initial take down. -- take an additional 150 lots for the remaining commitment. Highland notes that the Debtors seem to have a combined postpetition credit facility of only $86,000,000. Mr. Cavalier points out that with the current estimated costs of construction, the cost attributable to the Debtors for completing construction on the Highland Horizon development is approximately $40,000,000. Against these backdrop, Highland asks the Court to: (a) lift the automatic stay to allow it to provide updated notices related to building restrictions and other administrative matters pertaining to Highland Horizon building restrictions and other administrative matters; and (b) immediately terminate the Contract if the defaults are not cured. In the alternative, Highland asks the Court to compel the Debtors to immediately assume or reject the Sales Contract and accordingly, provide adequate assurance of future performance should they elect to assume the Contract. About Kimball Hill Based in Rolling Meadow, Illinois, Kimball Hill Inc. -- http://www.kimballhillhomes.com/-- is one of the largest privately-owned homebuilders and one of the 30 largest homebuilders in the United States, as measured by home deliveries and revenues. The company designs, builds and markets single- family detached, single-family attached and multi-family homes. The company currently operate within 12 markets, including, among others, Chicago, Dallas, Fort Worth, Houston, Las Vegas, Sacramento and Tampa, in five regions: Florida, the Midwest, Nevada, the Pacific Coast and Texas. Kimball Hill, Inc. and 29 of its affiliates filed for Chapter 11 protection on April 23, 2008 (Bankr. N.D. Ill. Lead Case No. 08- 10095). Ray C. Schrock, Esq., at Kirkland & Ellis LLP, represents the Debtors in their restructuring efforts. The Debtors' consolidated financial condition as of Dec. 31, 2007 reflected total assets of $795,473,000 and total debts $631,867,000. The Debtors have until Oct. 20, 2008, to exclusively file a bankruptcy plan. (Kimball Hill Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). LANDSOURCE COMMUNITIES: Taps Paul Hastings as Special Counsel ------------------------------------------------------------- Pursuant to Sections 327(e) and 330 of the Bankruptcy Code and Rule 2014(a) of the Federal Rules of Bankruptcy Procedure, LandSource Communities Development, LLC, and its debtor-affiliates seek the U.S. Bankruptcy Court for the District of Delaware's permission to employ Paul, Hastings, Janofsky & Walker LLP as their special counsel, nunc pro tunc to June 8, 2008. Paul Hastings has represented Debtor Lennar Mare Island, LLC since 1997, beginning with negotiations with the U.S. Department of the Navy, the City of Vallejo, and the environmental contractor, CH2M Hill Constructors, Inc., to set the amount of the Navy grant that would fund the environmental clean up the eastern early transfer portion of Mare Island. Paul Hastings has developed an institutional knowledge of the structure and interplay of the many governing documents and the relationship of LMI with the City of Vallejo, the Navy, CH2M Hill, and the California Department of Toxic Substances Control. For the last 12 years, Paul Hastings has also provided services to variety of land use matters to The Newhall Land and Farming Company, including the California Environmental Quality Act compliance and litigation. Paul Hastings advises on Newhall projects from the initial planning stages through project entitlement by local agencies. As a special counsel to the Debtors, Paul Hasting is expected to: (a) advise LMI with respect to certain real estate, labor, land use, environmental, development, disposition, and transactional matters and Newhall with respect to certain real estate, land use, environmental, development, disposition, and litigation matters; (b) provide counseling and oversight related to environmental due diligence and the preparation of remedial action plans, risk management plans, environmental impact reports, and similar plans and reports; (c) attend meetings, work with local governments and state and federal agencies entitling or approving Newhall and LMI development and remediation projects, work with consultants assisting Newhall, LMI or the local governments and agencies with Newhall and LMI development and remediation projects, and negotiate with representatives of creditors, insurers, and other parties- in-interest on behalf of Newhall and LMI; (d) take all necessary action to protect and preserve the Debtors' estates in connection with the Debtors' real estate, labor, environmental, and land use matters, including appearing in court, researching, preparing documents, papers, reports, motions, instruments, agreements, and applications, and managing administration, claims, and insurance coverage issues in connection with environmental insurance policies; (e) defend any action commenced against the Debtors and represent the Debtors' interests in negotiations concerning real estate, labor, environmental, and land use matters and resolving disputes among various parties in connection with the Debtors' real estate, labor, environmental, and land use matters; and (f) perform all other necessary or otherwise beneficial legal services for the Debtors in connection with real estate, labor, environmental, and land use matters. Paul Hastings will not be responsible for (a) appearances before the Court and the U.S. Trustee for Region 2; (b) litigation in the Court with respect to matters that are primarily disputes involving issues of bankruptcy law; or (c) the provision of legal advice within the bankruptcy, tax, or criminal law fields. Further, Paul Hastings will not be required to devote attention to forming professional opinions as to, or advising the Debtors with respect to, bankruptcy law. Paul Hastings' customary hourly rates are: Professional Hourly Rate ------------ ----------- Partners $615 - $895 Counsel $590 - $915 Associates $310 - $665 Paraprofessionals and Staff $110 - $425 The firm's attorneys expected to be active in the Debtors' Chapter 11 cases are: (a) Environmental Matters Professional Hourly Rate ------------ ----------- Gordon Hart, Partner $695 Beth Pennington, Of Counsel $640 Jill Yung, Associate $495 Michael Sharpless, Paralegal $310 (b) Land Use Matters Professional Hourly Rate ------------ ----------- Robert McMurry, Partner $775 A. Catherine Norian, Of Counsel $665 Elizabeth Hanks, Associate $405 Rosie Haq, Document Clerk/Paralegal $155 Paul Hastings will also charge the Debtors for expenses it incurs in connection with the engagement. The Debtors owe Paul Hastings approximately $210,000 for legal services related to prepetition matters. Paul Hastings intends to retain this claim against the Debtors and their estates. Gordon Hart, a partner at Paul Hastings, disclosed that his firm does not (a) represent or hold any interest adverse to the Debtors with respect to the matters on which Paul Hastings seeks to be employed; or (b) have any connection with the Debtors, any creditors or other parties-in-interest, their respective attorneys and accountants, or the United States Trustee. About LandSource Communities LandSource Communities Development LLC, which operates in Arizona, California, Florida, New Jersey, Nevada and Texas, is involved in the planning and development of master planned communities and transforming undeveloped land into ready-to-build home sites and commercial properties. With the exception of one development project in Marina del Rey, California, LandSource does not build homes or commercial properties. LandSource and 20 of its affiliates filed for chapter 11 bankruptcy protection before the U.S. Bankruptcy Court for the District of Delaware on June 8, 2008 (Lead Case No. 08-11111). The Debtors are represented by Marcia Goldstein, Esq., at Weil Gotshal & Manges in New York, and Mark D. Collins, Esq., at Richards Layton & Finger in Wilmington, Delaware. Lazard Freres & Co. acts as the Debtors' financial advisors, and Kurtzmann Carson Consultants serves as the Debtors' notice and claims agent. According to the Troubled Company Reporter on May 22, 2008, LandSource sought help from its lender consortium to restructure $1.24 billion of its debt. LandSource engaged a 100-bank lender group led by Barclays Capital Inc., which syndicates LandSource's debt. LandSource had received a default notice on that debt from the lender group after it was not able to timely meet its payments during mid-April. However, LandSource failed to reach an agreement with its lenders on a plan to modify and restructure its debt, forcing it to seek protection from creditors. The Debtors' exclusive plan filing period expires on Oct. 6, 2008. (LandSource Bankruptcy News, Issue No. 10; http://bankrupt.com/newsstand/or 215/945-7000). LANDSOURCE COMMUNITIES: Asks Court to Set Nov. 14 Claims Bar Date ----------------------------------------------------------------- Pursuant to Rules 2002(a)(7),(f),(l), and 3003(c) of Federal Rules of Bankruptcy Procedure and Section 502(b)(9) of the Bankruptcy Code, LandSource Communities Development, LLC, and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to: (a) set November 14, 2008, at 5:00 p.m. (prevailing Pacific Time) as the bar date for all persons and entities other than governmental units to file a proof of claim; (b) set December 5, 2008, at 5:00 p.m. (prevailing Pacific Time) as the bar date for all governmental units to file a proof of claim; (c) approve the proof of claim form; (d) approve the proposed bar date notice, with Sept. 19, 2008, as its anticipated mailing date; and (e) approve the form of notice procedures for the bar dates. Entities Not Required to File Proof of Claim The Debtors propose that these entities be not required from filing proofs of claim by the applicable bar date: (a) Any persons or entity that has already properly filed a proof of claim against a Debtor with the Bankruptcy Clerk or Kurtzman Carson Consultants LLC, the Debtors' official claims agent, in a form substantially similar to the Official Bankruptcy Form No. 10; (b) Any person or entity whose claim is listed on Schedule D, E, or F in the Debtors' schedules of assets and liabilities, and (i) the claim is not described as "disputed," "contingent," or "unliquidated"; (ii) the claimant agrees with the amount, nature, and priority of the claim stated in the Schedules, and (iii) the claimant agrees that the claim is an obligation of the specific Debtor which has listed the claim in its Schedules; (c) Any holder of a claim that has been allowed by order of the Court extended prior to the applicable Bar Date; (d) Any person or entity whose claim has been satisfied in full prior to the applicable Bar Date; (e) Any Debtor holding a claim against another Debtor; (f) Any officer, director, or employee for a claim for indemnification, contribution, or reimbursement; provided, however; any officer, director, or employee must file a Proof of Claim if they wish to assert any other claims against any of the Debtors, unless another exception identified applies; (g) Any holder of a claim allowable under Sections 503(b) or 507(a) of the Bankruptcy Code as an administrative expense of the Debtors' Chapter 11 cases; (h) Any person or entity that holds an interest in any Debtor, which interest is based upon the ownership of common or preferred stock, membership interests, partnership interests, or warrants, sell or subscribe to a interest; provided, however, that any interest holder who wishes to assert any claim against any of the Debtors that arises out of the ownership the interest must file its Proof of Claim before the Bar Date; and (i) Any holder of a claim for which the Court has already fixed a specific deadline to file a Proof of Claim. Mr. Collins notes that at this time, the Debtors do not seek to set a bar date for the filing of proofs of equity interests. "The Debtors may move the Court to establish a bar date for filing the proofs of interests in the future," Mr. Collins adds. Filing and Notice Procedures All persons and entities, including individuals, partnerships, corporations, joint ventures, trusts, and Governmental Units, that assert a claim, as defined in Section 101(5) of the Bankruptcy Code, against the Debtors which arose before the Petition Date, should file a Proof of Claim before the Bar Date; Any person or entity that asserts a claim that arises from the rejection of an executory contract or unexpired lease must file a proof of claim based before the later of (i) the Bar Date, or (ii) the date that is 20 days following the effective date of the rejection; provided, however, that a party to an executory contract or unexpired lease that asserts a claim on account of unpaid amounts accrued and outstanding as of the Petition Date must file a Proof of Claim before the Bar Date. The Debtors note that any holder of a claim who is required, but fails, to file a Proof of Claim before the proposed bar date will be forever barred, estopped, and enjoined from asserting the claim against them. The Debtors, with the assistance of KCC, have prepared a proof of claim form, based upon Official Form 10 and tailored to the Debtors' Chapter 11 cases. A full-text copy of the Proof of Claim Form is available for free at: http://ResearchArchives.com/t/s?310b The Debtors propose to mail notice of the bar dates to various parties. The Debtors will also publish the Bar Date Notice once in New York Times (National Edition) and once in the Los Angeles Times, each at least 45 days prior to the Bar Date, thus satisfying the 20-day notice requirements of Rule 2002(a(7) of the Federal Rules of Bankruptcy Procedure. About LandSource Communities LandSource Communities Development LLC, which operates in Arizona, California, Florida, New Jersey, Nevada and Texas, is involved in the planning and development of master planned communities and transforming undeveloped land into ready-to-build home sites and commercial properties. With the exception of one development project in Marina del Rey, California, LandSource does not build homes or commercial properties. LandSource and 20 of its affiliates filed for chapter 11 bankruptcy protection before the U.S. Bankruptcy Court for the District of Delaware on June 8, 2008 (Lead Case No. 08-11111). The Debtors are represented by Marcia Goldstein, Esq., at Weil Gotshal & Manges in New York, and Mark D. Collins, Esq., at Richards Layton & Finger in Wilmington, Delaware. Lazard Freres & Co. acts as the Debtors' financial advisors, and Kurtzmann Carson Consultants serves as the Debtors' notice and claims agent. According to the Troubled Company Reporter on May 22, 2008, LandSource sought help from its lender consortium to restructure $1.24 billion of its debt. LandSource engaged a 100-bank lender group led by Barclays Capital Inc., which syndicates LandSource's debt. LandSource had received a default notice on that debt from the lender group after it was not able to timely meet its payments during mid-April. However, LandSource failed to reach an agreement with its lenders on a plan to modify and restructure its debt, forcing it to seek protection from creditors. The Debtors' exclusive plan filing period expires on Oct. 6, 2008. (LandSource Bankruptcy News, Issue No. 10; http://bankrupt.com/newsstand/or 215/945-7000). LANDSOURCE COMMUNITIES: Taps D&T as Auditor and Accountant ---------------------------------------------------------- Pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code, Rules 2014 and 2014-1 of the Local Rules of Bankruptcy Practice and Procedure of the United States Bankruptcy Court for the District of Delaware, LandSource Communities Development, LLC, and its debtor-affiliates seek the Court's permission to employ Deloitte & Touche LLP as their independent auditors and accountants nunc pro tunc to July 25, 2008, pursuant to the terms of engagement letters dated as of: (a) July 21, 2008, between LandSource Communities Development LLC and D&T; (b) July 21, 2008, between Lennar Mare Island, LLC and D&T; (c) June 30, 2008, between The Newhall Land and Farming Company and D&T; and (d) June 30, 2008, between Tournament Players Club at Valencia, LLC, and D&T. D&T has served as the independent auditors for LandSource Communities Development LLC and certain its affiliates for over 10 years. As the Debtors' independent auditors and accountants, D&T is expected to: (1) audit and report the financial statements of: (i) LandSource Communities Development LLC; (ii) Lennar Mare Island, LLC; and The Newhall Land and Farming Company; and (iii) Tournament Players Club at Valencia, LLC; and (2) perform other accounting services for the Debtors as may be necessary, to the extent permitted under professional standards and as agreed to between the Debtors and D&T. D&T's current hourly billing rates are: Professionals Hourly Rate ------------- ----------- Partner/Principal/Director $400 - $500 Senior Manager $350 - $400 Manager $300 - $350 Senior Accountant $220 - $300 Staff Accountant $150 - $220 Administrative Staff $75 - $100 As of the Petition Date, the Debtors owe D&T $19,000 for professional services rendered prior to the Petition Date. Subject to and contingent upon the Court's approval of D&T's application, D&T has agreed to waive its Claim. D&T will also seek payment of compensation and reimbursement of expenses it will incur while performing its services to the Debtors. An affiliate of D&T, Deloitte Tax LLP, has provided tax services to the Debtors if so requested and as may be approved by the Court. Further, D&T provides and will continue to provide services to two of the Debtors' sponsors Lennar Corporation and LNR Property Corporation. Benjamin Fried, CPA, a partner at D&T, assures that Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, as modified by Section 1107(b). About LandSource Communities LandSource Communities Development LLC, which operates in Arizona, California, Florida, New Jersey, Nevada and Texas, is involved in the planning and development of master planned communities and transforming undeveloped land into ready-to-build home sites and commercial properties. With the exception of one development project in Marina del Rey, California, LandSource does not build homes or commercial properties. LandSource and 20 of its affiliates filed for chapter 11 bankruptcy protection before the U.S. Bankruptcy Court for the District of Delaware on June 8, 2008 (Lead Case No. 08-11111). The Debtors are represented by Marcia Goldstein, Esq., at Weil Gotshal & Manges in New York, and Mark D. Collins, Esq., at Richards Layton & Finger in Wilmington, Delaware. Lazard Freres & Co. acts as the Debtors' financial advisors, and Kurtzmann Carson Consultants serves as the Debtors' notice and claims agent. According to the Troubled Company Reporter on May 22, 2008, LandSource sought help from its lender consortium to restructure $1.24 billion of its debt. LandSource engaged a 100-bank lender group led by Barclays Capital Inc., which syndicates LandSource's debt. LandSource had received a default notice on that debt from the lender group after it was not able to timely meet its payments during mid-April. However, LandSource failed to reach an agreement with its lenders on a plan to modify and restructure its debt, forcing it to seek protection from creditors. The Debtors' exclusive plan filing period expires on Oct. 6, 2008. (LandSource Bankruptcy News, Issue No. 10; http://bankrupt.com/newsstand/or 215/945-7000). LANDSOURCE COMMUNITIES: Panel May Retain Pachulski as Lead Counsel ------------------------------------------------------------------ The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware approved the Official Committee of Unsecured Committee's retention of Pachulski Stang Ziehl & Jones LLP as its lead counsel. Judge Carey overruled Barclays Bank PLC's objection to the terms of Pachulski's retention. The Official Committee of Unsecured Creditors said Pachulski Stang Ziehl & Jones LLP has already created three separate billing categories relating to its investigation and analysis of the claims under the Final DIP Order. Laura D. Jones, Esq., a partner at the firm, informed the Court that the challenge billing category relates to services rendered for prosecuting any motion or lawsuit and related work to either: (a) challenge the extent, validity, priority, perfection or enforceability of the debt or liens of the lenders, (b) challenge the release of any claims against the lenders, or (c) bring any claims against the lenders. The Investigation billing category relates only to investigation of the extent, validity, priority, perfection, and enforceability of any of the First Lien Obligations and the Second Lien Obligations. The Valuation billing category, on the other hand, relates to preparing a motion directly relating to whether the Lenders are oversecured or undersecured. The Final DIP Order establishes reserves that may be used in connection with potential valuation and lien challenges. Ms. Jones argued that nothing in the Final DIP Order provides that Pachulski is not allowed to bill in excess of any of the reserved amounts to any of the billing categories. "Any assertion that the Final DIP Order has established a 'cap' on the fees of the Firm or the Debtors' counsel is meritless," Ms. Jones avered. According to Ms. Jones, Pachulski's fees are subject to review by all parties-in-interest and a Court approval. If Pachulski's fees exceed the reserve amounts, the First Lien Lenders have a right to object to the fees. If the Court allows the fees, then pursuant to Section 1129(a)(9) of the Bankruptcy Code the fees will need to be paid for the Debtors to confirm a plan of reorganization. Ms. Jones asserted that there is no basis to which a non-reserve amount allowed fees should come from the recoveries of the general unsecured creditors. Ms. Jones said that the First Lien Lenders have not cited to a single case supporting the assertion. "The First Lien Lenders should not be allowed to cherry pick which professionals should be paid and which professionals should not be paid," she added. About LandSource Communities LandSource Communities Development LLC, which operates in Arizona, California, Florida, New Jersey, Nevada and Texas, is involved in the planning and development of master planned communities and transforming undeveloped land into ready-to-build home sites and commercial properties. With the exception of one development project in Marina del Rey, California, LandSource does not build homes or commercial properties. LandSource and 20 of its affiliates filed for chapter 11 bankruptcy protection before the U.S. Bankruptcy Court for the District of Delaware on June 8, 2008 (Lead Case No. 08-11111). The Debtors are represented by Marcia Goldstein, Esq., at Weil Gotshal & Manges in New York, and Mark D. Collins, Esq., at Richards Layton & Finger in Wilmington, Delaware. Lazard Freres & Co. acts as the Debtors' financial advisors, and Kurtzmann Carson Consultants serves as the Debtors' notice and claims agent. According to the Troubled Company Reporter on May 22, 2008, LandSource sought help from its lender consortium to restructure $1.24 billion of its debt. LandSource engaged a 100-bank lender group led by Barclays Capital Inc., which syndicates LandSource's debt. LandSource had received a default notice on that debt from the lender group after it was not able to timely meet its payments during mid-April. However, LandSource failed to reach an agreement with its lenders on a plan to modify and restructure its debt, forcing it to seek protection from creditors. The Debtors' exclusive plan filing period expires on Oct. 6, 2008. (LandSource Bankruptcy News, Issue No. 10; http://bankrupt.com/newsstand/or 215/945-7000). LASALLE COMMERCIAL: Fitch Cuts and Assigns Rating on 2 CMBS Deals ----------------------------------------------------------------- After a review of the LaSalle Commercial Mortgage Securities Inc., series 2006-MF3 and 2006-MF4 small balance U.S. CMBS transactions, Fitch downgrades and assigns distressed recovery ratings to these bonds: LASL Series 2006-MF3 -- $13.0 million class C to 'BBB' from 'A'; -- $8 million class D to 'BB+' from 'BBB'; -- $3.7 million class E to 'BB' from 'BBB-'; -- $4.9 million class F to 'B-' from 'BB+'; -- $6.8 million class G to 'CCC/DR5' from 'B+'; -- $2.5 million class H to 'C/DR6'from 'B-'; -- $1.9 million class J to 'C/DR6' from 'CCC/DR1'; -- $1.2 million class K to 'C/DR6' from 'CC/DR5'. LASL Series 2006-MF4 -- $11.8 million class C to 'BBB+' from 'A'; -- $9 million class D to 'BBB-' from 'BBB+'; -- $2.3 million class E to 'BB+' from 'BBB'; -- $4.5 million class F to 'BB+' from 'BBB-'. -- $7.9 million class G to 'CCC/DR1' from 'BB'; -- $2.3 million class H to 'CC/DR5' from 'B+'; -- $1.7 million class J to 'C/DR6' from 'B-'; -- $1.7 million class K to 'C/DR6' from 'CCC/DR2'; -- $1.1 million class L to 'C/DR6' from 'CC/DR4'; -- $564,000 class M to 'C/DR6' from 'CC/DR5'. In addition, Fitch places the following classes on Rating Watch Negative: LASL Series 2006-MF3: -- $364.0 million class A at 'AAA'; -- $8 million class B at 'AA'. LASL Series 2006-MF4: -- $357.1 million class A at 'AAA'; -- $7.9 million class B at 'AA'. Fitch also affirms the following classes: LASL 2006-MF3: -- Interest-only class X at 'AAA'; -- $2.5 million class L at 'C/DR6'; -- $1.2 million class M at 'C/DR6'. LASL 2006-MF4: -- Interest-only class X at 'AAA'. The class N certificates in both transactions deals are not rated by Fitch. The downgrades and Rating Watch Negative placements are the result of additional specially serviced loans and increased loss expectations since Fitch's last rating action. Both transactions are expected to incur losses which will deplete the non-rated classes as well as several non-investment grade classes, thus negatively impacting current credit enhancement to all classes. The transaction's delinquencies far exceed the average delinquencies of typical CMBS deals. Total delinquencies for each transaction are as follows LASL 2006-MF3, 13.7% and LASL 2006-MF4, 7.5%. In estimating loan losses, Fitch reviewed recent evaluations or appraisals provided by the special servicers, and applied haircuts to determine Fitch's expected loss. These losses were then applied to the individual transactions per the documents and new credit enhancement levels were calculated. The transactions are collateralized by small balance commercial loans secured by multifamily, mobile home park and mixed use properties. The transactions are geographically diverse with significant concentrations in Texas, Arizona, Florida and Ohio. The loans are smaller than typical CMBS loans with a weighted average loan size of $1,142,614 ranging from approximately $90,000 to $5,000,000, and in some instances are not structured as single purpose entities and are full recourse. LE JARDIN: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: Le Jardin, LLC The Moore Law Group, LLC c/o John A. Moore, Esq. 1745 Martin Luther King Jr. Drive Atlanta, GA 30314 Tel: (404) 758-9111 Bankruptcy Case No.: 08-77019 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Le Jardin, LLC 08-77019 BOJ Homes at Twin Lakes, LLC 08-77022 BOJ Twin Lakes Investments, LLC 08-77024 BOJ Reserve Investments, LLC 08-77025 Retail at Le Jardin, LLC 08-77027 Type of Business: The Debtor is a real estate corporation Chapter 11 Petition Date: August 29, 2008 Court: Northern District of Georgia (Atlanta) Debtors' Counsel: John A. Moore, Esq. The Moore Law Group, LLC 1745 Martin Luther King Jr. Drive Atlanta, GA 30314 Tel: (404) 758-9111 Fax: 888-553-0071 Email: jmoore@moorelawllc.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtors did not file a list of their 20 Largest Unsecured Creditors. LEHMAN MORTGAGE: DBRS Puts Low-B Ratings on $3.68MM Class Certs. ---------------------------------------------------------------- DBRS assigned these ratings to the Mortgage Pass-Through Certificates, Series 2008-6 issued by Lehman Mortgage Trust, Series 2008-6. -- $66.20 million Class 1-A1 rated at AAA -- $6.62 million Class 1-A2 rated at AAA -- $41.10 million Class 2-A1 rated at AAA -- $10.28 million Class 2-A2 rated at AAA -- $5.14 million Class 2-A3 rated at AAA -- $41.10 million (notional) Class 2-AIO rated at AAA -- $6.61 million Class B1 rated at AA -- $2.79 million Class B2 rated at A -- $1.76 million Class B3 rated at BBB -- $2.28 million Class B4 rated at BB -- $1.40 million Class B5 rated at B The AAA ratings on the Class A series certificates reflect the 12.00% of credit enhancement provided by subordination. The AA, "A", BBB, BB, B ratings on Classes B1, B2, B3, B4, B5 reflect the 7.50%, 5.60%, 4.40%, 2.85%, 1.90% of credit enhancement, respectively, provided by classes subordinate thereto. The Class B6 Certificates are not rated by DBRS. The ratings on the certificates also reflect the quality of the underlying assets and the capabilities of Aurora Loan Services LLC as master servicer and primary servicer. Wells Fargo Bank, N. A. will serve as trustee. Interest and principal payments collected from the mortgage loans will be distributed on the 25th of each month, commencing in September 2008 in the following order: 1) current and unpaid interest to Senior Certificates relating to the respective mortgage pools; 2) principal amount to the Senior Certificates in their respective pools; 3) current and unpaid interest to the subordinate certificates; 4) principal amount to the subordinate certificates, sequentially from Class B1 to B6 in numerical order. Unless paid down to zero, unscheduled principal will be paid exclusively to the Senior Certificates for the first seven years and disproportionately in years eight through 11, subject to performance tests. Additionally, if senior credit enhancement doubles during the first three years and performance tests are satisfied, subordinate classes will receive half their pro rata share of unscheduled principal and their full pro rata share thereafter. The Class 2-A1 Certificates will benefit from an Interest Rate Cap Agreement with Lehman Brothers Special Financing Inc. The Trust contains mortgage loans originated by Lehman Brothers Bank, FSB and various other banks, savings and loans and other mortgage lending institutions. The pool consists of first-lien, near-prime quality, fixed and hybrid adjustable-rate mortgages. As of the cut-off date, Aug. 1, 2008, the loans had an initial aggregate principal balance of $146,968,430, a weighted-average mortgage rate of 6.747%, a weighted-average original FICO score of 750 and a weighted-average original loan-to-value ratio of 72.98%. LEVITZ FURNITURE: Court Allows WFNNB's $1,892,587 Admin. Claim -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York approved a stipulation between PLVTZ, LLC, dba Levitz Furniture Inc., and World Financial Network National Bank resolving the bank's administrative claim for $1,892,587. The claim represents payment of World Financial's fee for processing postpetition chargebacks for the Debtor. It consists of $1,590,447 and $287,000, stemming from chargebacks of sales before and after the bankruptcy filing. Under the court-approved stipulation, World Financial will have an allowed administrative claim for $100,000, which constitutes settlement of the $287,000. Meanwhile, the $1,590,447 is allowed as an unsecured claim against the Debtor. The stipulation further provides that the balance of $1,892,587 is not entitled to administrative expense status. About Levitz Furniture/PVLTZ Based in New York City, Levitz Furniture Inc. -- http://www.levitz.com/-- is a specialty retailer of furniture, bedding and home furnishings in the United States. It has 76 locations in major metropolitan areas, principally in the Northeast and on the West Coast of the United States. Levitz Furniture Inc. and 11 affiliates filed for chapter 11 on Sept. 5, 1997. In December 2000, the Court confirmed the Debtors' Plan and Levitz emerged from chapter 11 on February 2001. Levitz Home Furnishings Inc. was created as the new holding company as a result of the emergence. Levitz Home Furnishings and 12 affiliates filed for chapter 11 protection on Oct. 11, 2005 (Bankr. S.D.N.Y. Lead Case No. 05- 45189). In their second filing, the Debtors disclosed about $245 million in total assets and $456 million in total debts. Nicholas M. Miller, Esq., and Richard H. Engman, Esq., at Jones Day represented the Debtors. Jeffrey L. Cohen, Esq., Jay R. Indyke, Esq., and Cathy Hershcopf, Esq., at Cooley Godward Kronish LLP served as counsel to the Official Committee of Unsecured Creditors. During this period, the Debtors closed around 35 stores in the Northeast, California, Minnesota and Arizona. On March 28, 2008, the Court dismissed the chapter 11 cases of Levitz II. In December 2005, the Levitz II debtors sold substantially all of their assets to PLVTZ, LLC, an affiliate of Prentice Capital Management LLP, and the Pride Capital Group, doing business as Great American Group. Initially, Prentice owned all of the equity interests in PLVTZ. On July 6, 2007, PLVTZ was converted into a Delaware corporation, and Harbinger Capital Partners Special Situations Fund, LP, Harbinger Capital Partners Master Fund I, Ltd., and their affiliates became minority shareholders. Great American's stake in the acquisition was in running the going-out- of-business sales for some 27 Levitz units. PLVTZ, dba Levitz Furniture, continued to face decline in financial performance since December 2005. Liquidity issues and the inability to obtain additional capital prompted PLVTZ to seek protection under chapter 11 on Nov. 8, 2007 (Bankr. S.D.N.Y. Lead Case No. 07-13532). Paul D. Leake, Esq., and Brad B. Erens, Esq., at Jones Day represents the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC serves as the Debtors' claims and noticing agent. The Debtor's schedules show total assets of $123,842,190 and total liabilities of $76,421,661. (Levitz Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). LEVITZ FURNITURE: Court Approves Set-Off Deal with DFS Services --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York approved the stipulation between PLVTZ, LLC, dba Levitz Furniture Inc., and DFS Services LLC, permitting DFS to exercise its set-off rights. The stipulation dated July 8, 2008, allows DFS to set off $304,638, owed to it by the Debtor against the $571,015, held in the reserve account. In return, DFS will return to the Debtor $266,377 of the reserve fund. The reserve fund was put up to secure payment to DFS for administering the sale transaction between the Debtor and its customers who purchased merchandise through cards. About $341,617 of the reserve fund secures DFS' claim against the Debtor. The stipulation further provides that DFS' claim will be deemed paid and expunged without further court order, and that the parties will release each other from all claims following the set-off. About Levitz Furniture/PVLTZ Based in New York City, Levitz Furniture Inc. -- http://www.levitz.com/-- is a specialty retailer of furniture, bedding and home furnishings in the United States. It has 76 locations in major metropolitan areas, principally in the Northeast and on the West Coast of the United States. Levitz Furniture Inc. and 11 affiliates filed for chapter 11 on Sept. 5, 1997. In December 2000, the Court confirmed the Debtors' Plan and Levitz emerged from chapter 11 on February 2001. Levitz Home Furnishings Inc. was created as the new holding company as a result of the emergence. Levitz Home Furnishings and 12 affiliates filed for chapter 11 protection on Oct. 11, 2005 (Bankr. S.D.N.Y. Lead Case No. 05- 45189). In their second filing, the Debtors disclosed about $245 million in total assets and $456 million in total debts. Nicholas M. Miller, Esq., and Richard H. Engman, Esq., at Jones Day represented the Debtors. Jeffrey L. Cohen, Esq., Jay R. Indyke, Esq., and Cathy Hershcopf, Esq., at Cooley Godward Kronish LLP served as counsel to the Official Committee of Unsecured Creditors. During this period, the Debtors closed around 35 stores in the Northeast, California, Minnesota and Arizona. On March 28, 2008, the Court dismissed the chapter 11 cases of Levitz II. In December 2005, the Levitz II debtors sold substantially all of their assets to PLVTZ, LLC, an affiliate of Prentice Capital Management LLP, and the Pride Capital Group, doing business as Great American Group. Initially, Prentice owned all of the equity interests in PLVTZ. On July 6, 2007, PLVTZ was converted into a Delaware corporation, and Harbinger Capital Partners Special Situations Fund, LP, Harbinger Capital Partners Master Fund I, Ltd., and their affiliates became minority shareholders. Great American's stake in the acquisition was in running the going-out- of-business sales for some 27 Levitz units. PLVTZ, dba Levitz Furniture, continued to face decline in financial performance since December 2005. Liquidity issues and the inability to obtain additional capital prompted PLVTZ to seek protection under chapter 11 on Nov. 8, 2007 (Bankr. S.D.N.Y. Lead Case No. 07-13532). Paul D. Leake, Esq., and Brad B. Erens, Esq., at Jones Day represents the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC serves as the Debtors' claims and noticing agent. The Debtor's schedules show total assets of $123,842,190 and total liabilities of $76,421,661. (Levitz Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). LINENS N THINGS: Expansion of Ernst & Young's Services Approved --------------------------------------------------------------- The United States Bankruptcy Court for the District of Delaware granted the request of Linens 'n Things, Inc., and its debtor- affiliates to have the scope of services of Ernst & Young, LLP, expanded, pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code. Mark D. Collins, Esq., at Richards Layton & Finger, P.A., in Wilmington, Delaware, discloses that Ernst & Young will provide services pursuant to three statements of work: (1) Statement of Work #1 - Tax Consultation Re: Chapter 11 Filing dated as of June 13, 2008; (2) Statement of Work #2 - Tax Consultation Re: Chapter 11 Filing Restructuring Assistance dated as of June 13, 2008; and (3) Statement of Work #5 - Transfer Pricing Documentation Project dated as of June 13, 2008. Mr. Collins states that E&Y's familiarity and experience with the Debtors will enable it to provide valuable tax services necessary for their overall reorganization goals. He notes that without the firm's services, the Debtors would have to hire another firm, which would unnecessarily increase costs to the bankruptcy estates, and complicate the reorganization process. Clifton, New Jersey-based Linens 'n Things, Inc. -- http://www.lnt.com/-- is the second largest specialty retailer of home textiles, housewares and home accessories in North America operating 589 stores in 47 U.S. states and seven Canadian provinces as of Dec. 29, 2007. The company is a destination retailer, offering one of the broadest and deepest selections of high quality brand-name as well as private label home furnishings merchandise in the industry. Linens 'n Things has some 585 superstores (33,000 sq. ft. and larger), emphasizing low-priced, brand-name merchandise, in more than 45 states and about seven Canadian provinces. Brands include Braun, Krups, Calphalon, Laura Ashley, Croscill, Waverly, and the company's own label. Linens 'n Things was acquired by private equity firm Apollo Management in 2006. On May 2, 2008, these Linens entities filed chapter 11 petition (Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things, Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834), Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08- 10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT Virginia LLC (08-10841), LNT Merchandising Company LLC (08-10842), LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844). Judge Christopher S. Sontchi presides over the case. The Debtors' bankruptcy counsels are Mark D. Collins, Esq., John H. Knight, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., provide Linens 'n Things with bankruptcy counsel. The Debtors' special corporate counsel are Holland N. O'Neil, Esq., Ronald M. Gaswirth, Esq., Stephen A. McCaretin, Esq., Randall G. Ray, Esq., and Michael S. Haynes, Esq., at Morgan, Lewis & Bockius, LLP. The Debtors' restructuring management services provider is Conway Del Genio Gries & Co., LLC. The Debtors' CRO and Interim CEO is Michael F. Gries, co-founder of Conways Del Genio Gries & Co., LLC. The Debtors' claims agent is Kurtzman Carson Consultants, LLC. The Debtors' consultants are Asset Disposition Advisors, LLC, and Protivit, Inc. The Debtors' investment bankers are Financo, Inc., and Genuity Capital Markets. (Bankruptcy News About Linens 'n Things; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) LINENS N THINGS: Trade Creditors to Get Stock Warrants Under Plan ----------------------------------------------------------------- Linens Holding Co. and its debtor subsidiaries have filed a Plan of Reorganization and Disclosure Statement with the United States Bankruptcy Court for the District of Delaware. The Plan process has the support of LNT's Senior Lenders and its Official Committee of Unsecured Creditors, as well as an ad hoc committee of holders of its Senior Notes. A hearing regarding the approval of the Disclosure Statement will be scheduled by the Court in the near future. LNT, which filed for Chapter 11 on May 2, 2008, expects to emerge in early 2009. The Plan calls for the senior lenders to be paid in full and the holders of the Senior Notes to convert the majority of their debt into substantially all of the ownership of the reorganized LNT. Unsecured creditors will receive warrants to purchase common stock in the new company. "The filing of our Plan of Reorganization is a major milestone in the restructuring of LNT," said Michael Gries, Chief Restructuring Officer and Interim CEO, "and reflects the hard work of the entire LNT team and the creditors' and noteholders' committees." The Disclosure Statement filed with the Court contains a profile of the company, a description of the proposed distribution to creditors and an analysis of the plan, as well as information on the solicitation and approval process. LNT's Plan of Reorganization and Disclosure Statement are available at http://www.kccllc.net/linensnthings DiNicola Resigns as Executive Chairman LNT also announced that Robert J. DiNicola has submitted his resignation as Executive Chairman of the company. In his letter of resignation, Mr. DiNicola stated, that the filing of the Plan represents substantial progress toward the goals we outlined in connection with the Chapter 11 filing and the beginning of this final phase of the restructuring is an appropriate time to step down from his executive role. He has agreed to remain a member of the Board of Directors and serve as non-executive Chairman of the Board pending solicitation and approval of the Plan. "[Mr.] DiNicola has been an important part of LNT's restructuring efforts and one of the reasons why we expect to be able to complete our restructuring in such a short timeframe," added Mr. Gries. "I know I speak for the entire LNT community in thanking [Mr. DiNicola] as we look forward to emerging as a strong, financially sound and nimble company, well-positioned for the current retail environment and beyond." About Linens 'n Things Clifton, New Jersey-based Linens 'n Things, Inc. -- http://www.lnt.com/-- is the second largest specialty retailer of home textiles, housewares and home accessories in North America operating 589 stores in 47 U.S. states and seven Canadian provinces as of Dec. 29, 2007. The company is a destination retailer, offering one of the broadest and deepest selections of high quality brand-name as well as private label home furnishings merchandise in the industry. Linens 'n Things has some 585 superstores (33,000 sq. ft. and larger), emphasizing low-priced, brand-name merchandise, in more than 45 states and about seven Canadian provinces. Brands include Braun, Krups, Calphalon, Laura Ashley, Croscill, Waverly, and the company's own label. Linens 'n Things was acquired by private equity firm Apollo Management in 2006. On May 2, 2008, these Linens entities filed chapter 11 petition (Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things, Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834), Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08- 10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT Virginia LLC (08-10841), LNT Merchandising Company LLC (08-10842), LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844). Judge Christopher S. Sontchi presides over the case. The Debtors' bankruptcy counsels are Mark D. Collins, Esq., John H. Knight, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., provide Linens 'n Things with bankruptcy counsel. The Debtors' special corporate counsel are Holland N. O'Neil, Esq., Ronald M. Gaswirth, Esq., Stephen A. McCaretin, Esq., Randall G. Ray, Esq., and Michael S. Haynes, Esq., at Morgan, Lewis & Bockius, LLP. The Debtors' restructuring management services provider is Conway Del Genio Gries & Co., LLC. The Debtors' CRO and Interim CEO is Michael F. Gries, co-founder of Conways Del Genio Gries & Co., LLC. The Debtors' claims agent is Kurtzman Carson Consultants, LLC. The Debtors' consultants are Asset Disposition Advisors, LLC, and Protivit, Inc. The Debtors' investment bankers are Financo, Inc., and Genuity Capital Markets. (Bankruptcy News About Linens 'n Things; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) LYNNKOHN LLC: Legacy Asks Court to Dismiss Case or Appoint Trustee ------------------------------------------------------------------ Stacey Roberts of the Arkansas Democrat-Gazzete reported on Friday that Legacy National Bank asked the U.S. Bankruptcy Court for the Western District of Arkansas to either dismiss Lynnkohn LLC's Chapter 11 filing or to appoint a trustee to manage the property during the proceedings. Brandon Barber is Lynnkohn LLC's sole owner. The motion claims Lynnkohn's sole reason for filing for Chapter 11 bankruptcy was to get a stay on the scheduled foreclosure of The Legacy Building at 401 Watson St. According to Mr. Roberts, when the petition was filed Aug. 20, Barber was considered by bankruptcy law to be a "debtor in possession," meaning he regained control of The Legacy Building until a repayment plan is approved and completed. "A debtor in possession has many of the other powers and duties of a trustee, including the right, with the court's approval, to employ attorneys, accountants, appraisers, auctioneers, or other professional persons to assist the debtor during its bankruptcy case," Mr. Roberts points to the Bankruptcy Court Web site. Mr. Roberts adds that attorneys for Legacy and Barber and others had reached an out-of-court agreement July 23 in a foreclosure action by the bank against The Legacy Building for more than $18.7 million owed in unpaid mortgages. Mr. Roberts said that, according to the July consent decree filed in Washington County Circuit Court, Lynnkohn and individual loan guarantors Barber; his wife, Keri Barber; her sister Laura Kaffka; and the sister's husband, Seth Kaffka, had until Aug. 6 to pay back the mortgage or the seven-story, 37-unit condo would be sold. The mortgage went unpaid, and the sale was set for Aug. 21. The bank's motion -- which was filed by Stan Smith, Esq., at Mitchell, Williams, Selig, Gates & Woodyard -- asserts that Lynnkohn does not have the ability to formulate a repayment plan or carry any repayment plan to completion. In addition, Legacy says Lynnkohn was removed from managing the building because of mismanagement and a receiver appointed during the foreclosure proceedings by Legacy National Bank in Washington County Circuit Court. Lynnkohn, Brandon Barber, Keri Barber, Seth Kaffka and Laura Kaffka filed a complaint on Aug. 20, 2008, before the Washington County Circuit Court against Legacy National Bank and Flake & Kelley Management, Inc., doing business as Flake & Kelley Commercial. Flake & Kelley are the leasing agents for the property. The complaint alleges that Legacy National conspired with the leasing company to "discourage sales of the condo units, interfering with the contractual relationship of the court's receiver Wayne Swofford, deceptive trade practices and defrauding Lynnkohn, the guarantors, the court and Swofford." Lynnkohn, et al., seek more than $5 million in actual damages plus punitive damages. About Lynnkohn, LLC Based in Fayetteville, Arkansas, Lynnkohn, LLC develops real estate in northwest Arkansas. The company filed for Chapter 11 bankruptcy petition on August 20, 2008 (Bankr. W.D. Ark. Case No. 08-73301). K. Vaughn Knight, Esq., at Knight Law Firm, PLC, represents the Debtor in its restructuring efforts. When the company filed for bankruptcy, it listed $35,365,102 in total assets and $31,618,598 in total debts. MPK ENTERPRISES: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: MPK Enterprises Inc. 6028 N. 129th Ave. Litchfield Park, AZ 85340 Bankruptcy Case No.: 08-11532 Chapter 11 Petition Date: August 31, 2008 Court: District of Arizona (Phoenix) Debtor's Counsel: James E. Cross Osborn Maledon P.A. 2929 N. Central Ave. No. 2100 Phoenix, AZ 85012 Tel (602) 640-9307 Fax 602-664-2077 Email jcross@omlaw.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of its largest unsecured creditors. NETEFFECT INC: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: NetEffect Inc. aka NetEffect Semiconductor Inc. Banderacom Suite 100, 9211 Waterford Centre Blvd. Austin, TX 78758 Bankruptcy Case No.: 08-12008 Chapter 11 Petition Date: August 27, 2008 Court: District of Delaware (Delaware) Judge: Kevin J. Carey Debtor's Counsel: Curtis A. Hehn, Esq. Email chehn@pszjlaw.com Laura Davis Jones, Esq. Email ljones@pszjlaw.com Timothy P. Cairns, Esq. Email tcairns@pszyjw.com Pachulski Stang Ziehl & Jones LLP 17th Floor, 919 N. Market Street Wilmington, DE 19801 Tel (302) 652-4100 Fax (302)652-4400 Estimated Assets: $500,000 to $1 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of the Debtor's largest unsecured creditors. NEWPORT WAVES: Fitch Lowers 3 CDO Sub-Classes, Resolves Neg. Watch ------------------------------------------------------------------ Fitch Ratings has downgraded these sub-classes of Newport Waves CDO Series 2 and removed the notes from Rating Watch Negative. These rating actions are effective immediately: -- $1,000,000 sub-class A4A-$L credit-linked notes due 2017, to 'BBB+' from 'AA-'; -- $2,000,000 sub-class A6A-$L credit-linked notes due 2017, to 'BBB-' from 'A'; -- $5,000,000 sub-class A7-$L credit-linked notes due 2017, to 'BB+' from 'A-'. The actions reflect Fitch's view on the credit risk of the rated notes after the release of its new corporate CDO rating criteria. Key drivers of this transaction's credit risk include portfolio migration risk, with 5% of the portfolio currently on Rating Watch Negative and 21% of the portfolio with a Negative Outlook. Fitch also notes the industry concentration of 34.5% in the underperforming sector of banking & finance. The portfolio has experienced negative rating migration, resulting in an average portfolio quality of 'BBB' compared to 'A-/BBB+' at the closing date in April 2007. Since the notes were placed on Rating Watch Negative in May 2008, 12.3% of the portfolio has experienced further downgrades. In addition, 7.8% of the portfolio carries a rating below investment grade. This compares to current credit enhancement levels of 6.1%, 5.2% and 4.9% for sub-classes A4A-$L, A6A-$L and A7-$L, respectively. Fitch's rating action commentary on the Rating Watch Negative status (dated May 14, 2008) indicated a possible downgrade to the 'BBB' category for sub-class A4A-$L and as low as the 'BB' category for sub-classes A6A-$L and A7-$L if there were no significant changes prior to a resolution of the Watch status. Since then, Pacific Investment Management Company LLC, as portfolio manager, executed substitutions on the reference portfolio, replacing 12 obligors with 11 obligors (approximately 8% of the portfolio) of higher credit quality. However, key drivers of credit risk remained relatively unchanged, as the portfolio has experienced further downgrades, causing the overall credit profile of the sub-classes to be maintained. Newport Waves CDO (the issuer) is a managed synthetic collateralized debt obligation referencing a portfolio of primarily investment grade corporate obligations. At close, proceeds from the issuance of the notes were used to enter into a guaranteed investment contract with MBIA Inc., which is insured by MBIA Insurance Corp., to collateralize the credit default swap between the issuer and Bear Stearns Credit Products Inc., whose obligations are guaranteed by Bear Stearns Companies, LLC (rated 'AA-/F1+' by Fitch). Additional collateral has been posted and is marked to market on at least a weekly basis to maintain collateral levels required by the investment agreement. The portfolio is managed by PIMCO (investment grade corporate CDO asset manager rating of 'CAM1-' by Fitch). Fitch released updated criteria on April 30 for corporate CDOs and, at that time, noted it would be reviewing its ratings accordingly to establish consistency for existing and new transactions. As part of this review, Fitch makes standard adjustments for any names on Rating Watch Negative or with a Negative Outlook, downgrading such ratings for default analysis purposes by two and one notches, respectively. Fitch has previously noted that its review will be focused first on ratings most exposed to risks it has highlighted in its updated criteria. Consequently, Fitch placed the notes on Rating Watch Negative on May 14. As previously indicated, resolution of the Rating Watch Negative status depends on any plans managers/arrangers may choose to modify either the structure or the portfolio. In this case, the manager executed trades in the portfolio as indicated. N CAROLINA MEDICAL: Fitch Holds BB Rating on Revenue Bonds S. 1998 ------------------------------------------------------------------ Fitch affirms the 'BB+' rating on approximately $16.8 million of North Carolina Medical Care Commission's hospital revenue bonds, series 1998. The Rating Outlook is revised to Stable from Negative. The Outlook revision to Stable from Negative reflects Halifax Regional Medical Center's improved operations, balance sheet indicators and coverage levels over the past two fiscal years. Furthermore, the addition of several key physicians, well as managements focus on revenue cycle changes have played pivotal roles in turning around operating performance. In fiscal 2007, HRMC posted a positive 1.6% operating margin, up from positive 1.0% and negative 2.4% in fiscal 2006 and fiscal 2005 respectively. Through the nine months ended June 30 of fiscal 2008, the operating margin was positive 2.6% which management projects to be maintained through fiscal year-end. From fiscal years 2004-2007, days cash on hand increased from 60.2 to 82.3 days and cash-to-debt increased from 43.7% to 101.2% during the same period. The affirmation reflects HRMC's low debt burden, dominant market share, and positive utilization trends. In its primary service area, HRMC has maintained a dominant market share position of approximately 60%. The nearest acute care facility is Nash General Hospital (roughly 11% market share) in Rocky Mount, NC, approximately 35 miles away. HRMC has demonstrated positive utilization trends in recent years, though admissions and net emergency room visits were down slightly in fiscal 2007. In conjunction with the opening of the Joint Care Center, HRMC added an additional orthopedic surgeon and is in the process of recruiting another in the near term. Ongoing concerns include high dependence on government payors, small revenue base, weak demographic indicators, above average bad debt expense, and future capital spending needs. While recent decisions by management have improved operations, HRMC's operating results will continue to be hindered by its challenging payor mix that included approximately 53% Medicare and 18% Medicaid in fiscal 2007. Additionally, Fitch recognizes that the average length of stay (ALOS) of 5 days in fiscal 2007 is relatively high given HRMC's CMI of 1.2 and further hinders revenue growth potential. It should be noted that the addition of the hospitalist program in fiscal 2008 is expected to improve length of stay figures going forward. Although liquidity indicators have improved over the past few fiscal years, Fitch believes that the significant decrease in capital expenditures since fiscal 2004 will put pressure on the balance sheet as capital needs are realized and projects funded. HRMC is a 206 licensed-bed community medical center (144 operated beds) providing primary and secondary care services. The medical center is located in Roanoke Rapids, approximately 75 miles northeast of Raleigh. In fiscal 2007, HRMC had $95.7 million in total operating revenue. Disclosure to Fitch has been adequate with quarterly disclosure, although only audited annual disclosure is required in the bond documents. HRMC provides disclosure upon request to other third parties. Fitch notes that quarterly disclosure includes a balance sheet and income statements; however, a statement of cash flows and management discussion and analysis is not provided. NORTH OAKLAND: Section 341(a) Meeting Slated for September 2 ------------------------------------------------------------ The U.S. Trustee for Region 9 will convene a meeting of creditors of North Oakland Medical Center and its debtor-affiliates on Sept. 2, 2008, at 2:30 p.m. The meeting will take place at room 315 E, 211 W. Fort St. Bldg. in Detroit, Michigan. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in Pontiac, Michigan, North Oakland Medical Center, Inc. dba Pontiac General Hospital and Medical Center provide health care services. The company and two of its affiliates filed for Chapter 11 protection on Aug. 26, 2008 (Bankr. E.D. Mich. Lead Case No.08-60731). Matthew Wilkins, Esq., and Max J. Newman, Esq., at Butzel Long, P.C., represent the Debtors in their restructuring efforts. When the Debtor filed for protection from their creditors, they listed assets between $10 million to $50 million, and debts between $50 million to $100 million. NORTH OAKLAND: Gets Initial Nod to Use McLaren's $1.5MM DIP Loan ---------------------------------------------------------------- The Hon. Marci B. McIvor of the United States Bankruptcy Court for the Eastern District of Michigan authorized North Oakland Medical Center and its debtor-affiliates to obtain, on an interim basis, up to $1,500,000 in postpetition financing from Mclaren Health Care Corporation under a loan and security agreement. A hearing is set for Sept. 23, 2008, at 10:30 a.m., to consider for final approval of the motion. Objections, if any, are due Sept. 19, 2008. McLaren Health agreed to provide a committed $2,750,000 in DIP financing to the Debtors on a final basis. The DIP facility will enable the Debtors to continue to operate while they pursue the sale of substantially all of their assets as a going concern, which sale will allow the Debtors to remain open to continue to serve the citizens of the City of Pontiac. In addition, the DIP loan will be used for working capital and general corporate purposes, and to pay the cost and expenses related to the administration of the Debtors' bankruptcy cases. The DIP facility will accrue on the principal amount of the loan outstanding at the end of each day at a fluctuating rate per annum equal to the Prime Rate plus 1%. The DIP facility is subject to carve-out for payment of professionals retained by the Debtors and the committee, and the U.S. Trustee's fees. There is a $750,000 carve-out if the sale of the Debtors' assets is consummated by Oct. 31, 2008, otherwise $1,000,000 carve-out will be paid. To secure their DIP obligation, McLaren Health will be granted superpriority administrative expense claims with priority over all other administrative expenses in the Debtors' cases pursuant to Section 364(c)(1) of the Bankruptcy Code. The DIP agreement contains customary and appropriate events of defaults. A full-text copy of the Debtors' loan and security agreement is available for free at: http://ResearchArchives.com/t/s?317d A full-text copy of the Debtors' cash flow analysis is available for free at: http://ResearchArchives.com/t/s?317e Headquartered in Pontiac, Michigan, North Oakland Medical Center, Inc. dba Pontiac General Hospital and Medical Center provide health care services. The company and two of its affiliates filed for Chapter 11 protection on Aug. 26, 2008 (Bankr. E.D. Mich. Lead Case No.08-60731). Matthew Wilkins, Esq., and Max J. Newman, Esq., at Butzel Long, P.C., represent the Debtors in their restructuring efforts. When the Debtor filed for protection from their creditors, they listed assets between $10 million to $50 million, and debts between $50 million to $100 million. PACIFIC LUMBER: Resumes Lumber Operations as Humboldt Redwood ------------------------------------------------------------- Log deliveries have resumed in the first week of August 2008 at Humboldt Redwood Co., f/k/a The Pacific Lumber Company, bringing operations almost back to normal, The Press Democrat reports. About 250 of the old PALCO's 300 employees have been re-hired, the report states. "On the surface it looks like business as usual," Richard Higgenbottom, Humboldt Redwood's chief executive officer, told The Press Democrat. "But major management changes have been put in place, including implementing new protections for the remaining old-growth redwood trees dotting the company's 210,000 acres of southern Humboldt County timberlands." The Press Democrat relates that the same policies were put in place 10 years ago by the Fisher family when they bought the former Louisiana-Pacific Co. The Fisher family owns Mendocino Redwood Company, LLC, which formed a partnership with investment fund Marathon Structured Finance Fund L.P., to purchase PALCO and its affiliates with a Texan Bankruptcy Court approval in late July 2008. About Pacific Lumber Based in Oakland, California, The Pacific Lumber Company -- http://www.palco.com/-- and its subsidiaries operate in several principal areas of the forest products industry, including the growing and harvesting of redwood and Douglas-fir timber, the milling of logs into lumber and the manufacture of lumber into a variety of finished products. Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned subsidiaries of Pacific Lumber. Scotia Pacific, Pacific Lumber's largest operating subsidiary, was established in 1993, in conjunction with a securitization transaction pursuant to which the vast majority of Pacific Lumber's timberlands were transferred to Scotia Pacific, and Scotia Pacific issued Timber Collateralized Notes secured by substantially all of Scotia Pacific's assets, including the timberlands. Pacific Lumber, Scotia Pacific, and four other subsidiaries filed for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case Nos. 07-20027 through 07-20032). Jack L. Kinzie, Esq., at Baker Botts LLP, is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan, Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead counsel. Kyung S. Lee, Esq., Esq., at Diamond McCarthy LLP is Scotia Pacific's co-counsel, replacing Porter & Hedges LLP. John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Official Committee of Unsecured Creditors. When Pacific Lumber filed for protection from its creditors, it listed estimated assets and debts of more than $100 million. Scotia Pacific listed total assets of $932,000,000 and total debts of $765,978,335. The Debtors filed their Joint Plan of Reorganization on Sept. 30, 2007, which was amended on Dec. 20, 2007. Four other parties-in- interest have filed competing plans for the Debtors -- The Bank of New York Trust Company, N.A., as Indenture Trustee for the Timber Notes; the Official Committee of Unsecured Creditors; Marathon Structured Finance Fund L.P, the Debtors' DIP Lender and Agent under the DIP Credit Facility; and the Heartlands Commission, which represents the tribal members of the Bear River Band of Rohnerville Rancheria and PALCO employees. On July 8, 2008, the Court confirmed the Modified First Amended Joint Plan of Reorganization With Technical Modifications for the Debtors proposed by Marathon Structured Finance Fund L.P., Mendocino Redwood Company, LLC, and the Official Committee of Unsecured Creditors. The Debtors emerged from bankruptcy protection on July 30, 2008. The Reorganized Entities have been renamed as Humboldt Redwood Co., under the management of Mendocino Redwood. (Scotia/Pacific Lumber Bankruptcy News, Issue No. 68; http://bankrupt.com/newsstand/or 215/945-7000). PCG SUMMIT LAKELINE: Files for Chapter 11 to Avoid Foreclosure -------------------------------------------------------------- PCG Summit-Lakeline Station, L.P.'s newly found investor may help the company keep its planned $400 million Lakeline Station in Northwest Austin and stave off a foreclosure of the facility, Kate Miller Morton of the American-Statesman reports. The Lakeline Station is intended to be one of the first high-density residential and commercial developments along a new commuter rail line, Statesman writes. According to the report, the Debtor filed its chapter 11 petition before the scheduled foreclosure of almost half of the property. Landowner William Savage, foreclosed on 141 acres of the site in July 2008 after Pacific Summit missed at least one quarterly payment, Statesman says. The Debtor had bought the rest of the property outright from Mr. Savage. HomeFed Corp. in Carlsbad, California currently owns the general partnership interest in PCG Summit-Lakeline Station, Statesman relates. Paul Borden is the current chief executive and president of HomeFed. The Statesman says that HomeFed also underwent reorganization. It filed for bankruptcy in 1992 after its largest operations at HomeFed Bank collapsed. HomeFed emerged from bankruptcy in the mid-1990s, and became a development company, Statesman notes. HomeFed develops and manages the San Elijo Hills mixed-use project in San Diego County. It also partly plans the Otay Ranch development near Chula Vista, California. The Statesman says that the role of PCG's original partners, William Lo and Steve Levenson, in Lakeline Station is unclear. Messrs. Lo and Levenson formed Pacific Summit in 2005 and invested at least $100 million in real property on which to build homes. Mr. Lo, according to the report, filed for personal bankruptcy in California. Based on the report, since November 2007, about two dozen suppliers have secured or attempted to secure liens on PCG's properties, including Pacific Century Homes. Early this year, the Debtor's lenders foreclosed on a property at Highland Meadows, 230 acres between U.S. 183 and Texas 29. Colonial Bank seized the Debtor's Fairways at Steiner Ranch, planned to have 88 homes. The Debtor's Northwoods at Lakeline property, which is 178 acres of lot adjacent to Lakeline Station, is set for foreclosure, the Statesman relates. About PCG Summit Costa Mesa, California-based PCG Summit-Lakeline Station, L.P. is a single real asset entity. It filed its chapter 11 petition on Aug. 4, 2008 (Bankr. C.D. Calif. Case No. 08-14588). Judge Theodor Albert presides over the case. Eric D. Goldberg, Esq., represents the Debtor in its restructuring efforts. The Debtor estimated both its assets and debts to be between $10,000,000 and $50,000,000. The Debtor's largest unsecured creditor is Diversified Pacific Opportunity Fund, which is owed $10,600,000. PCG SUMMIT-LAKELINE: Case Summary & 16 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: PCG Summit-Lakeline Station, L.P. 890 Baker Street, Suite 200 Costa Mesa, CA 92626 Bankruptcy Case No.: 08-14588 Type of Business: The Debtor is a single asset real estate. Chapter 11 Petition Date: August 4, 2008 Court: Central District of California (Santa Ana) Judge: Theodor Albert Debtor's Counsel: Eric D. Goldberg, Esq. 1901 Avenue of the Stars 12th Floor Los Angeles, CA 90067 Tel: (310) 228-5760 Fax: (310) 228-5788 egoldberg@stutman.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Debtor's 16 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Diversified Pacific Loan $10,600,000 Opportunity Fund 10621 Civic Center Drive Rancho Cucamonga, CA 91730 Pacific Century Homes Loan $995,401 890 Baker Street, Suite 200 Costa Mesa, CA 92626 Lo Family Trust U/D/T dated Loan $910,000 July 6, 1989 890 Baker Street, Suite 200 Costa Mesa, CA 92626 Bury+Partners Engineering Engineering $218,521 Solutions Services 221 W. Sixth Street, Suite 600 Austin, Texas 78701 Armbrust & Brown, L.L.P. Legal Services $127,000 100 Congress Avenue, Suite 1300 Austin, Texas 78701 Pacific Lummit Partners, LLC Loan $96,960 890 Baker Street, Suite 200 Costa Mesa, CA 92626 Calthorpe Associates Architecture $24,000 2095 Rose Street Services Berkeley, California 94709 KTGY Group, Inc. Architecture and $15,000 17992 Mitchell South Planning Irvine, CA 92614 Services Terracon Consultants, Inc. Environmental $12,000 5307 Industrial Oaks Boulevard Services Suite 160 Austin, Texas 78735 Plateau Life and Wildlife Agricultural Tax $8,745 Management Deferral 14101 Highway 290W, Suite 1100B Austin, Texas 78737 Justin W. Lo Irrevocable Trust Loan $5,515 890 Baker Street, Suite 200 Costa Mesa, California 92626 Haskell & White Accountant $4,860 16485 Laguna Canyon Road Services Irvine, California 92618 Eastwind Financial Group, Inc. Consulting $4,550 890 Baker Street, Suite 200 Services Costa Mesa, CA 92626 Balance-Wheel Environmental $800 1616 Broadmoor Drive Advice Austin, Texas 78723 Ridgway's - Austin Copying Services $417 615 S. Lamar Austin, Texas 78704 Thomas Reprographics Copying Services $164 817 E. Indian School Road Phoenix, Arizona 85014 PCG SUMMIT-NORTHWOODS: Case Summary & 9 Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: PCG Summit-Northwoods L.P. 890 Baker Street, Suite 200 Costa Mesa, CA 92626 Bankruptcy Case No.: 08-15268 Type of Business: The Debtor operates a real estate business. Chapter 11 Petition Date: August 29, 2008 Court: Central District Of California (Santa Ana) Judge: Theodor Albert Debtors' Counsel: Eric D. Goldberg 12th Fl., 1901 Ave of the Stars Los Angeles, CA 90067 Tel (310) 228-5760 Fax 310-228-5788 Email egoldberg@stutman.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Debtors' Consolidated List of 9 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ CA-Austin Lakeline LLC Loan $8,092,448 Ste. 300, 13215 East Penn Street Whittier, CA 90601 Bury & Partners Engineering Services $214,213 221 West 6th Street, Ste. 600 Austin , TX 78701 Armburst & Brown LLP Legal Services $100,000 100 Congree Ave. Ste. 1300 Austin, TX 78701-2744 Land Design Partners Landscape Services $14,000 HDR/WHM Transaportation Engineering Services $12,555 Kevin Crook Architect Services $8,678 KTGY Group Inc. Architect Services $5,067 Haskell & White Accounting Services $3,755 OCB Reprographics Inc. Copying Services $143 PHS GROUP: Court Appoints Tranzon to Market Somerset Assets ----------------------------------------------------------- Tranzon Asset Advisors has been appointed by the U.S. Bankruptcy Court for the Eastern District of Kentucky to sell at Absolute Auction the assets of PHS Group, Inc. and its subsidiaries including The Somerset Refinery, Inc., and Somerset Oil, Inc., located in Somerset, Kentucky, 80 miles south of Lexington, Kentucky. The refining operations and plant of Somerset Oil is one of the only two refineries in Kentucky and was operational in late 2007. The Chapter 11 Trustee, Mr. William D. Bishop, upon order of the Court has employed the expertise of Tranzon to market the assets to a world-wide audience and new buyers are being contacted daily through its advertising campaign. Tranzon's press release said that the "incredible opportunity to own and operate a refinery is not limited just to the refining plant. Rather the "Right to Refine Crude Oil" in the United States presents potential suitors with a chance to trade oil and petroleum products as well as contract for raw crude with regional and international impact. Somerset Oil is an attractive opportunity for Strategic, Portfolio, or Financial investment with growth potential and excellent returns, based on an over 50 year track record. The refinery is uniquely positioned to serve the needs of small and midsize crude oil producers in Eastern Kentucky and Tennessee. It can also provide a non-monopoly based refining capacity to similar producers in the remainder of Kentucky, as well as West Virginia and Virginia." "Pipeline and barge providers of crude oil do not serve Eastern Kentucky or Tennessee in this geographic area, there is a significant underserved marketplace for the buyers," stated Ed Durnil, the Court appointed Auctioneer and CEO of Tranzon Asset Advisors. The recent installation of a regional intermodal rail park has made the prospect of rail deliveries of crude oil not only possible but probable for expanded capacity in the near term. The auction team and stakeholders formulated a multiple lot or parcel offering for the assets of Somerset Oil, Inc. The first lot consists of a 5,500 barrel-per-day petroleum refinery situated on approximately 105 acres of land in the heart of Somerset and includes all furniture, fixtures & equipment along with the maintenance and repair shops associated with the plant's operation and upkeep. Lots 2 and 3 are the primary offices for the company and a smaller office building and warehouse located off Monticello Street in Somerset. Lot 4 is the full right, title and interest in a pipeline easement traversing 6 counties in south-central Kentucky with a permit for crossing Lake Cumberland. This pipeline is unique in that it is available for multiple uses and could provide natural gas, oil or finished product to many communities that have no access to these resources. Additionally, the auction sale will be offering separate or combined lots, several non-real estate assets. Lot 5 is all the company's rolling stock that includes over 100 vehicles such as over-the-road semi-trucks, oil tankers, environmental clean-up vehicles, company cars and vehicles, panel service trucks and dump trucks. Lot 6 is the current inventory from Somerset Oil, which was a significant Pennzoil distributor, as well as refined oil stocks currently at a warehouse facility on the refinery grounds. Lot 7 consists of 12 well-located neighborhood gas stations in various locations throughout eastern Kentucky. The gas stations are being offered in two distinct auction formats. First, they can be bought separately or as a block by submitting sealed bids to Tranzon. If acceptable bids are not received for each station, they will be sold at a live outcry auction at each site the week following the refinery auction. Bidders will have the unique option of buying only the lot or lots they desire or a bidder can bundle Lots 1 through 7 and bid for same if so desired. Current oil prices have driven tremendous interest to this auction event. World-wide headlines and the national debate to increase refining capacity are at the heart of the issues surrounding buyer actions. With record crude prices and energy independence on the line, the lucky buyer can expect tremendous return on investment from this plant for decades to come. Potential buyers must provide proof of financial capacity to close on their bid(s) and a deposit of ten percent of the purchase price in order to buy the assets. Sealed bids are due on Sept. 19, 2008 to the offices of Tranzon Asset Advisors. Bidders may obtain due diligence from Tranzon through -- http://www.tranzon.com/-- or by calling 866-243-8243 or 270-769-0284. About Tranzon Asset Advisors Tranzon Asset Advisors, -- http://www.tranzon.com/-- headquartered in Elizabethtown, KY, is an internationally recognized real estate auction company and a member company of Tranzon, L.L.C., which is based in Virginia Beach, VA. Founded in 2001, Tranzon L.L.C. has 12 independently owned and operated member companies that collectively have more than 30 offices ranging from coast-to-coast. The professionals working at Tranzon member companies specialize in providing real estate auction and accelerated marketing services to corporations, financial institutions, trustees, individuals and estates throughout the U.S. Tranzon member companies regularly conduct over 1,000 auctions and 2,500 property valuations per year, effecting in excess of three billion dollars in real estate assets. About PHS Group Lexington, Kentucky-based PHS Group, Inc.'s primary business is the operation of affiliate Somerset Refinery, Inc., which has a processing capability of 5500 barrels of oil per day. The refinery primarily produces gasoline at octanes of 87, 89, 91, diesel fuel and heavy fuel oils for homes and industry furnaces. It filed its chapter 11 petition on May 8, 2007 with its five affiliates (Bankr. E.D. Ky. Lead Case No. 07-60407). Judge Joseph M. Scott, Jr., presides over the case. Gregory R. Schaaf, Esq., at Greenebaum Doll & MacDonald, P.L.L.C., represents the Debtors in their restructuring efforts. The Debtors estimated both their assets and debts to be between $1 million and $100 million. PRC LLC: Has Until October 7 to Object to Creditors' Claims ----------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York extended, in the interim, PRC LLC and its debtor-affiliates' claim objection deadline through Oct. 7, 2008. The Court will convene another hearing to consider extending the deadline on a final basis. Pursuant to their confirmed Joint Plan of Reorganization, the Reorganized Debtors can serve objections and requests for estimation on a claimant, and file them with the Court no later than 60 days after the Plan Effective Date or at a later date as fixed by the Court. The Reorganized Debtors' objection deadline was to expire Aug. 29, 2008. The Reorganized Debtors have made significant progress in claim reconciliation, Philip J. Landau, Esq., at Akerman Senterfitt, in Fort Lauderdale, Florida, said. They have filed two omnibus claims objections and 48 individual claim objections. They have also objected to claims filed by Wesley O'Brien, Drive America Holdings, Inc., BGTX Project, LLP, and IAC. Mr. Landau informed that there are hundreds of claims to be reviewed. In addition, Mr. Landau notes that his firm has recently been retained as the Reorganized Debtors' counsel and thus, will require additional time to verify accuracy and validity of the claims. He says the Reorganized Debtors have also obtained consensual agreements on 60 claims. Given additional time, the Reorganized Debtors expect to obtain more consensual agreements with claimants, resulting to reduced time required for hearing claim objections, Mr. Landau relates. To that extent, the Reorganized Debtors ask the Court to extend the period within which they may object to claims, through and including Oct. 28, 2008. The Reorganized Debtors assert that the extended objection deadline will result to a claims objection process that eliminates all improper claims to the benefit of their estates and creditors. About PRC LLC Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC -- http://www.prcnet.com/-- is a leading provider of customer management solutions. PRC markets its services to brand-focused, Fortune 500 U.S. corporations and delivers these services through a global network of call centers in the U.S., Philippines, India, and the Dominican Republic. PRC is the sole member of each of PRC B2B, LLC, and Precision Response of Pennsylvania, LLC, and the sole shareholder of Access Direct Telemarketing, Inc., each of which is a debtor and debtor- in-possession in PRC's joint Chapter 11 cases. Panther/DCP Intermediate Holdings, LLC, is the sole member of PRC. PRC, together with its operating subsidiaries PRC B2B, Access Direct, and PRC PA, is a leading provider of complex, consultative, outsourced services in the Customer Care and Sales & Marketing segments of the business process outsourcing industry. Since 1982, the company has acquired and grown customer relationships for some of the world's largest and most brand-focused corporations in the financial services, media, telecommunications, transportation, and retail industries. The company and four of its affiliates filed for Chapter 11 protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08- 10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP, represents the Debtors in their restructuring efforts. The Debtors chose Stephen Dube, at CXO LLC, as their restructuring and turnaround advisor. Additionally, Evercore Group LLC provides investment and financial counsel to the Debtors. The Debtors' consolidated financial condition as of Dec. 31, 2007 showed total assets of $354,000,000 and total debts of $261,000,000. The Debtors submitted to the Court a Chapter 11 Plan of Reorganization on Feb. 12, 2008. The Court confirmed that Plan mid-June 2008. (PRC LLC Bankruptcy News, Issue No. 20; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) PRC LLC: Wants BofA's $2 Mil. Interest Claim Deemed as Unsecured ---------------------------------------------------------------- PRC LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to allow Bank of America's $2 million claim as a general unsecured claim and be treated as a Class 6 claim under the Debtors' plan of reorganization. As of the date of bankruptcy, the Debtors were parties to an Amended and Restated First Lien Credit and Guaranty Agreement with The Royal Bank of Scotland PLC as administrative agent and collateral agent, and certain other lenders, pursuant to which the Debtors are required to enter into one or more interest rate swap agreements. The Debtors would pay interest at a fixed rate to the swap counterparty and the swap counterparty would pay interest at a floating rate to the Debtors, in each case based on a notional amount of indebtedness. In this light, the Debtors and the Bank of America entered into an interest rate swap agreement under an ISDA Master Agreement and a Schedule to the ISDA Master Agreement, each dated Jan. 30, 2007. Pursuant to the First Lien Credit Agreement, Bank of America was required to deliver to Royal Bank, as Administrative Agent, a letter appointing the Collateral Agent as its agent under the applicable loan documents. The Appointment Letter would serve to quality Bank of America as a secured party in the Interest Rate Swap Agreement and would allow its claim under the Interest Rate Swap Agreement to be secured by the security interests granted to the Collateral Agent under the Security Agreement. The Appointment Letter must also indicate Bank of America's consent to be bound by Sections 9.03, 10.02 and 10.14 of the First Lien Credit Agreement. The Debtors, however, inform the Court that Bank of America did not deliver the Collateral Agent Appointment Letter to Royal Bank at any time before the bankruptcy filing. Subsequently, in April 2008, Bank of America filed a $2,488,218 claim, asserting a secured priority resulting from the termination of the Interest Rate Swap Agreement, plus postpetition interest, reasonable out of pocket expenses, and legal fees. The Debtors' Redacted Summary of Schedules have indicated Bank of America Claim as holding an unsecured, non-priority claim in an unknown and unliquidated amount with respect to the Interest Rate Swap Agreement. That Claim was classified under the Plan as Class 6 general unsecured claims. The Plan classifies the First Lien Lenders' Claim under the First Lien Credit Agreement as Class 4 Allowed Prepetition First Lien Claims. Bank of America has also objected to the confirmation of the Plan, alleging, among other things, that the Plan improperly failed to classify its Interest Rate Swap Claim as a Class 4 Claim. The Debtors contended that because the Plan provides for a post-confirmation procedure to resolve disputed claims, Bank of America's objection should be overruled. Against these backdrop, the Reorganized Debtors ask the Court to: (a) declare the Interest Rate Swap Claim as a general unsecured claim entitled to treatment as a Class 6 Claim under the Plan; (b) allow the Interest Rate Swap Claim as a Class 6 Claim for $2,488,218; and (c) require Bank of America to return any Class 4 distributions provisionally made under the Plan with respect to the Interest Rate Swap Claim. The Debtors assert that pursuant to the Confirmation Order, the Interest Rate Swap Claim will be treated as a Class 4 Claim, in the event the Court determines that it has the same priority as an Allowed Prepetition First Lien Claim, notwithstanding any contrary provision in the Plan. About PRC LLC Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC -- http://www.prcnet.com/-- is a leading provider of customer management solutions. PRC markets its services to brand-focused, Fortune 500 U.S. corporations and delivers these services through a global network of call centers in the U.S., Philippines, India, and the Dominican Republic. PRC is the sole member of each of PRC B2B, LLC, and Precision Response of Pennsylvania, LLC, and the sole shareholder of Access Direct Telemarketing, Inc., each of which is a debtor and debtor- in-possession in PRC's joint Chapter 11 cases. Panther/DCP Intermediate Holdings, LLC, is the sole member of PRC. PRC, together with its operating subsidiaries PRC B2B, Access Direct, and PRC PA, is a leading provider of complex, consultative, outsourced services in the Customer Care and Sales & Marketing segments of the business process outsourcing industry. Since 1982, the company has acquired and grown customer relationships for some of the world's largest and most brand-focused corporations in the financial services, media, telecommunications, transportation, and retail industries. The company and four of its affiliates filed for Chapter 11 protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08- 10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP, represents the Debtors in their restructuring efforts. The Debtors chose Stephen Dube, at CXO LLC, as their restructuring and turnaround advisor. Additionally, Evercore Group LLC provides investment and financial counsel to the Debtors. The Debtors' consolidated financial condition as of Dec. 31, 2007 showed total assets of $354,000,000 and total debts of $261,000,000. The Debtors submitted to the Court a Chapter 11 Plan of Reorganization on Feb. 12, 2008. The Court confirmed that Plan mid-June 2008. (PRC LLC Bankruptcy News, Issue No. 20; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) PRC LLC: Names Gregory Carr as Senior VP of Sales and Marketing --------------------------------------------------------------- PRC LLC has appointed Gregory M. Carr as the company's Senior Vice President of Sales and Marketing. Mr. Carr is an industry veteran who brings more than 25 years of sales management experience to the role and a track record of implementing sustainable market strategies that drive revenue growth, the report said. Prior to joining PRC, Mr. Carr was Senior Vice President of Sales at OSI, a $400 million Business Processing Outsourcing (BPO) company in the receivables management industry, where reportedly he dramatically improved year-over-year sales results. Mr. Carr has served in various senior executive sales leadership at ADP, a $8.0 billion leading outsourcing provider, including Vice President of Sales for the Claims Services Division. Chief Executive Officer Steven K. Richards said, "I have had a close working relationship with Greg for several years and am thrilled that he will be leading PRC's sales and marketing division. Greg's extensive industry and business knowledge as well as his experience in operational turnarounds will allow him to make valuable contributions at PRC as we actively seek to grow our market presence while maintaining our high standards of client service excellence." Mr. Carr said, "Throughout my professional career, I have sought to develop mutually beneficial strategic partnerships with customers that ultimately result in 'Clients for Life,' a mindset that I feel is reflected in PRC's emphasis on outstanding service and client satisfaction. I look forward to working closely with Steve and the PRC team as we chart our new growth course and reach our strategic goals." Mr. Carr earned a Business degree in Marketing from Xavier University. About PRC LLC Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC -- http://www.prcnet.com/-- is a leading provider of customer management solutions. PRC markets its services to brand-focused, Fortune 500 U.S. corporations and delivers these services through a global network of call centers in the U.S., Philippines, India, and the Dominican Republic. PRC is the sole member of each of PRC B2B, LLC, and Precision Response of Pennsylvania, LLC, and the sole shareholder of Access Direct Telemarketing, Inc., each of which is a debtor and debtor- in-possession in PRC's joint Chapter 11 cases. Panther/DCP Intermediate Holdings, LLC, is the sole member of PRC. PRC, together with its operating subsidiaries PRC B2B, Access Direct, and PRC PA, is a leading provider of complex, consultative, outsourced services in the Customer Care and Sales & Marketing segments of the business process outsourcing industry. Since 1982, the company has acquired and grown customer relationships for some of the world's largest and most brand-focused corporations in the financial services, media, telecommunications, transportation, and retail industries. The company and four of its affiliates filed for Chapter 11 protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08- 10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP, represents the Debtors in their restructuring efforts. The Debtors chose Stephen Dube, at CXO LLC, as their restructuring and turnaround advisor. Additionally, Evercore Group LLC provides investment and financial counsel to the Debtors. The Debtors' consolidated financial condition as of Dec. 31, 2007 showed total assets of $354,000,000 and total debts of $261,000,000. The Debtors submitted to the Court a Chapter 11 Plan of Reorganization on Feb. 12, 2008. The Court confirmed that Plan mid-June 2008. (PRC LLC Bankruptcy News, Issue No. 20; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) QUAKER FABRIC: Court Confirms Joint Liquidating Plan ---------------------------------------------------- The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware confirmed a second amended joint liquidating plan of Quaker Fabric Corporation and Quaker Fabric Corporation of Fall River. As reported in the Troubled Company Reporter July 18, 2008, the amended Plan contemplates the liquidation of assets of the Debtors for the benefit of their creditors and the appointment of a liquidating agent. Initial Distribution On the plan's effective date, the liquidating agent, on behalf of the Debtors, will pay in cash in full all (i) administrative expense claims, (ii) priority tax claims, and (iii) secured claims. Holders of unsecured claims will receive their pro rata share of available cash, if any. The amended plan classifies interests against and liens in the Debtors in five classes. The classification of interests and claims are: Treatment of Claims and Interests Types of Estimated Estimated Class Claims Treatment Amount Recovery ----- -------- --------- ---------- --------- unclassified administrative $1,600,000 100% claims unclassified priority tax $200,000 100% claims 1 priority unimpaired $155,386 100% claims 2 secured unimpaired $0 N/A claims 3 WARN Act impaired $6,000,000 5%-15% claims 4 unsecured impaired $25,000,000 6% claims 5 equity impaired Not Estimated 0% interest Holders of Class 1 allowed priority claims will receive in full satisfaction of and exchange for their claim (i) the amount of the allowed priority claim, without interest, in cash after the Plan's effective date, or (ii) other treatment as may be agreed upon in writing by the holder, the Debtors and the Committee. About Quaker Fabric Based in Fall River, Mass., Quaker Fabric Corp. (NASDAQ: QFAB) -- http://www.quakerfabric.com/-- designs, manufactures, and markets woven upholstery fabrics primarily for residential furniture manufacturers and jobbers. It also develops and manufactures specialty yarns, including chenille, taslan, and spun products for use in the production of its fabrics, as well as for sale to distributors of craft yarns, and manufacturers of homefurnishings and other products. The company is one of the largest producers of Jacquard upholstery fabrics. Quaker Fabric sells its products through sales representatives andindependent commissioned sales agents in the United States, Canada, Mexico, and internationally. The company and its affiliate, Quaker Fabric Corporation of Fall River, filed for chapter 11 protection on Aug. 16, 2007 (Bankr. D. Del. Case No. 07-11146). John D. Sigel, Esq. at Wilmer Cutler Pickering Hale and Dorr LLP and Joel A. Waite, Esq. at Young Conaway Stargatt & Taylor LLP are co-counsels to the Debtors. Epiq Bankruptcy Solutions is the Debtors' claims agent. The Official Committee of Unsecured Creditors has selected Shumaker, Loop & Kendrick, LLP, as its bankruptcy counsel and Benesch, Friedlander, Coplan & Aronoff, LLP, as co-counsel. The Debtors' schedules reflect total assets of $41,375,191 and total liabilities of $54,435,354. QUEBECOR WORLD: Court Okays Settlement of $3.8MM Claim with TSIC ---------------------------------------------------------------- Quebecor World (USA), Inc., asserted a $3,800,000 claim against TSIC, Inc., formerly Sharper Image Corporation, on account of printing services under an amended and restated printing agreement between the parties dated January 5, 2007. Quebecor alleges that its claim is secured by a lien on certain paper, currently in its possession under the Agreement. TSIC disputes Quebecor's lien rights since those lien rights may be avoidable. TSIC's counsel, Steven K. Kortanek, Esq., at Womble Carlyle Sandridge & Rice, PLLC, in Wilmington, Delaware, relates that TSIC and Quebecor engaged in arms-length negotiations and agreed to sell the Paper for $460,000 on an agreed-upon basis to a third-party, free and clear of liens. The parties agreed that gross proceeds from the sale be allocated at 80% to Quebecor and 20% to TSIC. According to Mr. Kortanek, by the stipulation, TSIC will realize meaningful value on account of its interest in the Paper, while avoiding the cost and risk associated with litigation. If litigated, the dispute may be further complicated by the fact that both TSIC and Quebecor are debtor-in-possession in separate Chapter 11 cases, pending in different districts. If the claim is not resolved, further discovery, motion practice, and litigation will likely ensue in both the U.S. Bankruptcy Court for the District of Delaware, where TSIC filed its Chapter 11 case, and the U.S. Bankruptcy Court for the Southern District of New York, where Quebecor filed its Chapter 11 case, with additional expense and delay. TSIC believes that under relevant circumstances, the terms and conditions of the stipulation are favorable and in the best interests of the estate and its creditors. Accordingly, TSIC asks the Delaware Court to approve the Stipulation. A full-text copy of the stipulation with Quebecor is available at no charge at http://ResearchArchives.com/t/s?317c About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Judge Kevin Gross presides over the case. Harvey R. Miller, Esq., Lori R. Fife, Esq., and Christopher J. Marcus, Esq., at Weil, Gotshal & Manges, LLP, serve as the Debtor's lead counsel. Steven K. Kortanek, Esq., and John H. Strock, Esq., at Womble, Carlyle, Sandridge & Rice, P.L.L.C., serve as the Debtor's local Delaware counsel. An Official Committee of UnsecuredCreditors has been appointed in the case. Cooley Godward Kronish LLP is the Committee's lead bankruptcy counsel. Whiteford Taylor Preston LLC is the Committee's Delaware counsel. When the Debtor filed for bankruptcy, it listed total assets of $251,500,000 and total debts of $199,000,000. As of June 30, 2008, the Debtor listed $52,962,174 in total assets and $39,302,455 in total debts. The Court extended the exclusive period during which the Debtor may file a Plan through and including Sept. 16, 2008. Sharper Image sought and obtained the Court's approval to change its name to "TSIC, Inc." in relation to an an Asset Purchase Agreement by the Debtor with Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. (Sharper Image Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE: IQW), -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. The company has operations in Mexico, Brazil, Colombia, Chile, Peru, Argentina and the British Virgin Islands. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08- 10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. The Debtors have until Sept. 30, 2008, to file a plan of reorganization in the chapter 11 case. The Debtors' CCAA stay has been extended to Sept. 30, 2008. RPM TECHNOLOGIES: June 30 Balance Sheet Upside-Down by $2,264,260 ----------------------------------------------------------------- RPM Technologies Inc.'s consolidated balance sheet at June 30, 2008, showed $2,853,628 in total assets and $5,117,888 in total liabilities, resulting in a $2,264,260 stockholders' deficit. At June 30, 2008, the company's consolidated balance sheet also showed strained liquidity with $891,948 in total current assets available to pay $5,117,888 in total current liabilities. The company reported a net loss of $399,834 on revenues of $682,013 for the second quarter ended June 30, 2008, compared with a net loss of $491,553 on revenues of $598,097 in the same period of 2007. Gross profit increased by $220,557, from a gross loss of $27,076 in the three months ended June 30, 2007, to a gross profit of $193,481 in the same period in 2008. The company attributed the increase in gross profit primarily to better efficiency and keeping its raw material cost down in a time of generally increasing costs of petroleum and its effects on plastic costs. The increase in revenues in the three months ended June 30, 2008, as compared to the same period in 2007 is primarily attributable to a increase in sales of the company's plastic roofing and pallets stringer molds which are back in production. The decrease in net loss primarily reflects the increase in sales and profit margins. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2008, are available for free at http://researcharchives.com/t/s?3183 Going Concern Doubt Through June 30, 2008, the company had incurred cumulative losses of $17,785,774 and and had a deficit in stockholders' equity of $2,264,260. In addition, certain term notes are in default and have been classified as current in the balance sheet. The company's successful transition to attaining profitable operations is dependent upon obtaining financing adequate to fulfill its development, marketing and sales activities and achieving a level of revenues adequate to support the company's cost structure. These factors raise substantial doubt about the company's ability to continue as a going concern. About RPM Technologies Headquartered in Mokena, Illinois, RPM Technologies Inc. (OTC BB: RPMM) --http://rpmplasticpallets.com/-- is engaged in the business of developing, producing through subcontract manufacturers, marketing and selling plastic pallets and other material-handling products throughout the United States, Canada and South America. SHARPER IMAGE: Wants to Set Oct. 13 as Admin. Claims Bar Date ------------------------------------------------------------- Pursuant to Section 503(a) of the Bankruptcy Code and Rule 3003(c)(3) of the Federal Rules of Bankruptcy Procedure, TSIC, Inc., fka The Sharper Image Corp., asks the U.S. Bankruptcy Court for the District of Delaware to set October 13, 2008, as the deadline for filing administrative expense claims against the Debtor or its estate arising or accrued from and after the Petition Date through and including September 1, 2008. The Debtor proposes to exclude these entities from filing administrative claims: (i) any person or entity who has already properly filed an administrative expense claim request with the Court or the Court-approved claims agent, Kurtzman Carson Consultants LLC; (ii) professionals retained by the Debtor or the Official Committee of Unsecured Creditors under Sections 327, 328, or 1103, and whose administrative expense claim is for services performed and reimbursements of expenses incurred; and (iii) the U.S. Trustee. The Debtor relates any administrative expense claimant asserting an administrative expense claim will be required to file on or before the Administrative Claims Bar Date to Kurtzman Carson by U.S. mail, overnight delivery or hand delivery. The Administrative Expense Claim Requests must be (i) written in English, (ii) is denominated in lawful U.S. currency; (iii) sets forth with specificity the legal and factual basis for the Administrative Expense Claim; and (iv) has attached supporting documentation. The circumstances of the Debtor's Chapter 11 case justify the setting of the Administrative Claims Bar Date at this time, Francis A. Monaco, Jr., Esq., at Womble Carlyle Sandridge & Rice, PLLC, in Wilmington, Delaware, tells the Court. The Debtor is in the process of winding down its estate. To determine whether a plan of liquidation is feasible or other action necessary, it is appropriate that the amount of allowed administrative expense claims be determined, Mr. Monaco says. SHARPER IMAGE: Court Approves Committee/Joint Venture Settlement ---------------------------------------------------------------- Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware approved a letter agreement entered into between the Official Committee of Unsecured Creditors in the bankruptcy case of TSIC, Inc., fka The Sharper Image Corp., and the joint venture among Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. The Committee agreed to refrain from impeding the consummation of the sale transaction, including, without limitation, the filing or prosecution of its objection to the sale of the Debtor's assets to the Joint Venture and the filing or prosecution of an appeal or motion to reconsider the Sale. The Committee also agreed to waive the right to challenge the Joint Venture's conduct during the auction process or the reduction of its bid. In return, the Joint Venture agreed to fund a trust account for the exclusive benefit of the Debtor's general unsecured creditors in an amount equal to the lesser of (i) $500,000, and (ii) 10% of the gross royalties ultimately paid for the period of January 1, 2009, through December 31, 2009, in connection with the Intellectual Property acquired from the Debtor in the sale transaction. The U.S. Trustee objected to the letter agreement on the contention that the agreement contravenes the intention of the Bankruptcy Code generally, and conflicts with the absolute priority rule specifically. Judge Gross, in a 14-page opinion, held that a lengthy discussion of the Settlement's adherence to the absolute priority rule is neither necessary nor appropriate for the simple reason that the absolute priority rule is not violated in substance or spirit. Judge Gross cited that In re Armstrong World Indus., Inc., 432 F.3d 507 (3d Cir. 2005) makes it clear that the absolute priority rule is violated when a senior class' portion of its share of estate property is allocated to a junior class over the objection of an intervening creditor class. In the Debtor's case, Judge Gross said he is not dealing with estate property or with property to which a senior class was entitled or, for that matter, with a creditor or class of creditors making the payment. Judge Gross noted that the U.S. Trustee presented no evidence in support of the objection that the funds the Joint Venture agreed to pay in the Settlement were otherwise intended for the Debtor's estate. Judge Gross said it is satisfied that the Committee's actions in achieving the Settlement were proper and found that the Settlement is fair, reasonable, and in the best interest of the estate. Chagrin Withdraws Objection Chagrin Retail, LLC, withdrew its objection to the Debtor's proposed assumption and assignment of a nonresidential real property for the property located at the Eton Chagrin Boulevard in Woodmere Village, Ohio. * * * At the Debtor's behest, the Court approved the termination agreements entered into between the Debtor and each of the landlords for 14 real property leases: Store No. Name Location -------- ---- -------- 220 Alamona Center Honolulu, HI 230 North Star Mall San Antonio, TX 332 Washington Square Tigard, OR 348 Chandler Fashion Center Chandler, AZ 261 Tyson Galleria McLean, VA 273 Village Corte Madera Corte Madera, CA 274 The Fashion Show Las Vegas, NV 306 Crabtree Valley Mall Raleigh, NC 316 Aventura Mall Aventura, FL 317 Cherry Creek Shopping Center Denver, CO 335 Kierland Commons Scottsdale, AZ 349 Bellevue Square Bellevue, WA 363 The Mall at Millennia Orlando, FL 407 NorthPoint Mall Alpharetta, GA 421 Alderwood Mall Lynwood, WA The Debtor previously withdrew the sale motion as to the 14 leases pending negotiations of a resolution with the lessors of the leases who have filed objections to the proposed sale of the leases. The Contested Leases were proposed to be assumed by the Debtor and assigned to American Apparel Retail, Inc. The Lessors object to the proposed assumption and assignment on the grounds of, among other things, adequate assurance of future performance, changes in the "use" clauses of the contested leases, and purported disruption of the tenant mix and balance at the affected retail centers. Acting U.S. Trustee Appeals Ruling Roberta A. DeAngelis, Acting United States Trustee for Region 3, appealed from Judge Gross' order approving the letter agreement entered into between the Official Committee of Unsecured Creditors and the joint venture among Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Judge Kevin Gross presides over the case. Harvey R. Miller, Esq., Lori R. Fife, Esq., and Christopher J. Marcus, Esq., at Weil, Gotshal & Manges, LLP, serve as the Debtor's lead counsel. Steven K. Kortanek, Esq., and John H. Strock, Esq., at Womble, Carlyle, Sandridge & Rice, P.L.L.C., serve as the Debtor's local Delaware counsel. An Official Committee of UnsecuredCreditors has been appointed in the case. Cooley Godward Kronish LLP is the Committee's lead bankruptcy counsel. Whiteford Taylor Preston LLC is the Committee's Delaware counsel. When the Debtor filed for bankruptcy, it listed total assets of $251,500,000 and total debts of $199,000,000. As of June 30, 2008, the Debtor listed $52,962,174 in total assets and $39,302,455 in total debts. The Court extended the exclusive period during which the Debtor may file a Plan through and including Sept. 16, 2008. Sharper Image sought and obtained the Court's approval to change its name to "TSIC, Inc." in relation to an an Asset Purchase Agreement by the Debtor with Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. (Sharper Image Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SHARPER IMAGE: Court Okays Settlement of $3.8MM Quebecor Claim -------------------------------------------------------------- Quebecor World (USA), Inc., asserted a $3,800,000 claim against TSIC, Inc., formerly Sharper Image Corporation, on account of printing services under an amended and restated printing agreement between the parties dated January 5, 2007. Quebecor alleges that its claim is secured by a lien on certain paper, currently in its possession under the Agreement. TSIC disputes Quebecor's lien rights since those lien rights may be avoidable. TSIC's counsel, Steven K. Kortanek, Esq., at Womble Carlyle Sandridge & Rice, PLLC, in Wilmington, Delaware, relates that TSIC and Quebecor engaged in arms-length negotiations and agreed to sell the Paper for $460,000 on an agreed-upon basis to a third-party, free and clear of liens. The parties agreed that gross proceeds from the sale be allocated at 80% to Quebecor and 20% to TSIC. According to Mr. Kortanek, by the stipulation, TSIC will realize meaningful value on account of its interest in the Paper, while avoiding the cost and risk associated with litigation. If litigated, the dispute may be further complicated by the fact that both TSIC and Quebecor are debtor-in-possession in separate Chapter 11 cases, pending in different districts. If the claim is not resolved, further discovery, motion practice, and litigation will likely ensue in both the U.S. Bankruptcy Court for the District of Delaware, where TSIC filed its Chapter 11 case, and the U.S. Bankruptcy Court for the Southern District of New York, where Quebecor filed its Chapter 11 case, with additional expense and delay. TSIC believes that under relevant circumstances, the terms and conditions of the stipulation are favorable and in the best interests of the estate and its creditors. Accordingly, TSIC asks the Delaware Court to approve the Stipulation. A full-text copy of the stipulation with Quebecor is available at no charge at http://ResearchArchives.com/t/s?317c About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Judge Kevin Gross presides over the case. Harvey R. Miller, Esq., Lori R. Fife, Esq., and Christopher J. Marcus, Esq., at Weil, Gotshal & Manges, LLP, serve as the Debtor's lead counsel. Steven K. Kortanek, Esq., and John H. Strock, Esq., at Womble, Carlyle, Sandridge & Rice, P.L.L.C., serve as the Debtor's local Delaware counsel. An Official Committee of UnsecuredCreditors has been appointed in the case. Cooley Godward Kronish LLP is the Committee's lead bankruptcy counsel. Whiteford Taylor Preston LLC is the Committee's Delaware counsel. When the Debtor filed for bankruptcy, it listed total assets of $251,500,000 and total debts of $199,000,000. As of June 30, 2008, the Debtor listed $52,962,174 in total assets and $39,302,455 in total debts. The Court extended the exclusive period during which the Debtor may file a Plan through and including Sept. 16, 2008. Sharper Image sought and obtained the Court's approval to change its name to "TSIC, Inc." in relation to an an Asset Purchase Agreement by the Debtor with Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. (Sharper Image Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SHARPER IMAGE: Gift Card Holders Rep. Pursues Conversion Motion --------------------------------------------------------------- Frederic Prohov, as representative of a class of gift card holders, says that TSIC, Inc., fka The Sharper Image Corp., is in a precarious financial condition. He points out, in an amended bid to convert the Debtor's Chapter 11 bankruptcy case to Chapter 7, that the Debtor's June 2008 operating report shows that the Debtor has little if any unrestricted cash and that more than half of its $36,403,436 in total current assets consist of $7,203,601 in prepaid expenses and $17,304,554 in deferred or prepaid income taxes. He also notes that the operating report shows more than $23,000,000 of postpetition debts. Mr. Prohov maintains that the Debtor's case should be converted to Chapter 7 so that the Gift Card Holders will not be prejudiced by natural bias of the Debtor-in-possession and the Official Committee of Unsecured Creditors who may reduce or eliminate gift card claims. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Judge Kevin Gross presides over the case. Harvey R. Miller, Esq., Lori R. Fife, Esq., and Christopher J. Marcus, Esq., at Weil, Gotshal & Manges, LLP, serve as the Debtor's lead counsel. Steven K. Kortanek, Esq., and John H. Strock, Esq., at Womble, Carlyle, Sandridge & Rice, P.L.L.C., serve as the Debtor's local Delaware counsel. An Official Committee of UnsecuredCreditors has been appointed in the case. Cooley Godward Kronish LLP is the Committee's lead bankruptcy counsel. Whiteford Taylor Preston LLC is the Committee's Delaware counsel. When the Debtor filed for bankruptcy, it listed total assets of $251,500,000 and total debts of $199,000,000. As of June 30, 2008, the Debtor listed $52,962,174 in total assets and $39,302,455 in total debts. The Court extended the exclusive period during which the Debtor may file a Plan through and including Sept. 16, 2008. Sharper Image sought and obtained the Court's approval to change its name to "TSIC, Inc." in relation to an an Asset Purchase Agreement by the Debtor with Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. (Sharper Image Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SHARPER IMAGE: Transfers Principal Offices to Walnut Creek ---------------------------------------------------------- Sharper Image Corporation, now known as TSIC, Inc., notifies the U.S. Bankruptcy Court for the District of Delaware that effective August 31, 2008, its principal executive offices will be located at 1255 Treat Boulevard, Suite 300, in Walnut Creek, California, with telephone number (415) 999-8317 and fax number (925) 472- 6572. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Judge Kevin Gross presides over the case. Harvey R. Miller, Esq., Lori R. Fife, Esq., and Christopher J. Marcus, Esq., at Weil, Gotshal & Manges, LLP, serve as the Debtor's lead counsel. Steven K. Kortanek, Esq., and John H. Strock, Esq., at Womble, Carlyle, Sandridge & Rice, P.L.L.C., serve as the Debtor's local Delaware counsel. An Official Committee of UnsecuredCreditors has been appointed in the case. Cooley Godward Kronish LLP is the Committee's lead bankruptcy counsel. Whiteford Taylor Preston LLC is the Committee's Delaware counsel. When the Debtor filed for bankruptcy, it listed total assets of $251,500,000 and total debts of $199,000,000. As of June 30, 2008, the Debtor listed $52,962,174 in total assets and $39,302,455 in total debts. The Court extended the exclusive period during which the Debtor may file a Plan through and including Sept. 16, 2008. Sharper Image sought and obtained the Court's approval to change its name to "TSIC, Inc." in relation to an an Asset Purchase Agreement by the Debtor with Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. (Sharper Image Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) STEVE & BARRY'S: CNE Wants Assurance of Payment for Utility Usage ----------------------------------------------------------------- (Louie) Constellation NewEnergy, Inc. (CNE) asks the United States Bankruptcy Court for the Southern District of New York to determine that it is entitled to adequate assurance of payment from Steve and Barry's LLC and its debtor-affiliates in the form of a deposit equal to the amount of two months of the Debtors' utility usage, or $312,000, pursuant to Section 366 of the Bankruptcy Code. Before the Petition Date, CNE, and the Debtors entered into a Master Electricity Supply Agreement. Pursuant to the Electricity Agreement, CNE agreed to provide electricity service to 14 of the Debtors' locations commencing on March 20, 2008, at a rate of $0.09626 per kilowatt-hour for each location, plus applicable fees and charges, if any. The Debtors' average monthly rate of consumption for the 14 locations aggregate $156,000. If payment is not received in a timely manner, a default will occur and the Debtors have an additional 20 days to cure the default, after receiving notice of default from CNE. Subsequent to the July 29, 2008 hearing on the Debtors' Utility Motion, certain facts have surfaced, which upon consideration, warrant the reconsideration of the two-week assurance deposit offered to it, according to CNE. Among other things, CNE learned that the Debtors' use of Cash Collateral expires on August 22, 2008, and that as a condition of the Debtors' use of cash collateral, they must close on the sale of substantially all of their assets -- to BH S&B Holdings, LLC or any other buyer -- no later than August 20, 2008, Michael S. Etkin, Esq., at Lowenstein Sandler, PC, in New York, relates. Certain parties have also voiced concerns that if the going concern sale cannot close in advance of August 20, 2008, the full-scale liquidation contemplated in the Cash Collateral Order would have to commence -- thus rendering the Debtors' estates administratively insolvent, Mr. Etkin points out. Moreover, the Debtors must overcome various contingencies in advance of the August 20, 2008 closing date. Mr. Etkin notes that there are difficulties in satisfying certain contingencies. CNE further learned that the gross adequate assurance deposit amount was not the $1,000,000 that the Debtors estimated it would be. Rather, it was $250,000. The two-month deposit would cover approximately two billing periods of service at the average rate of consumption over the life of the Electricity Agreement, which is the amount that CNE could lose if the Debtors miss one postpetition payment, Mr. Etkin tells the Court. In light of the potential for administrative insolvency, the cash available to the Debtors given the limited aggregate deposit paid to utilities pursuant to the Utility Order, as well as the other changed circumstances, CNE should not be placed in the precarious position of being forced to provide electricity service to the Debtors on a postpetition basis with the risk of recouping only a portion of the amounts due on postpetition invoices, Mr. Etkin argues. Debtors Object Debtors' counsel, Shai Y. Waisman, Esq., at Weil, Gotshal & Manges LLP, in New York, contends that CNE's request for additional deposit is an "impermissible attempt" to reargue the Debtors' Utility Motion. Under the guise of a change of circumstances, CNE reiterates the same arguments the Court already rejected in connection with CNE's objection to the Utilities Motion, he argues. There are no changed circumstances that warrant granting CNE additional adequate assurance of payment, Mr. Waisman asserts. Instead of relying on facts to support its allegations, CNE relies on statements of people "in the know" and mischaracterize statements made by Debtors' counsel, he says. Moreover, CNE's other "facts," including the identity of the stalking horse bidder and the extension of the use of cash collateral, do not constitute changed circumstances that would warrant additional adequate assurance of payment -- instead, they support a denial of CNE's Additional Deposit Motion, Mr. Waisman maintains. Mr. Waisman points out that at the July 29, 2008 hearing, the Court held that "[t]here has been no suggestion that any sale, whether on a going concern basis or on a going-out-of-business basis, can or will ignore utility costs and charges that are being accrued." None of CNE's new "facts" change this conclusion, he says. Headquartered in Port Washington, New York, Steve and Barry LLC -- http://www.steveandbarrys.com/-- is a national casual apparel retailer that offers high quality merchandise at low prices for men, women and children. Founded in 1985, the company operates 276 anchor and junior anchor shopping center and mall-based locations throughout the U.S. At STEVE & BARRY'S (R) stores, shoppers will find brands they can't find anywhere else, including the BITTEN(TM) collection, the first-ever apparel line created by actress and global fashion icon Sarah Jessica Parker, and the STARBURY(TM) collection of athletic and lifestyle apparel and sneakers created with NBA (R) star Stephon Marbury. Steve & Barry's, LLC, and 63 affiliates filed separate voluntary petitions under Chapter 11 on July 9, 2008 (Bankr. S.D. N.Y. Lead Case No. 08-12579). Lori R. Fife, Esq., and Shai Waisman, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. Diana G. Adams, United States Trustee for Region 2, has appointed seven members to the Official Committee of Unsecured Creditors in the Debtors' Chapter 11 cases. When the Debtors filed for bankruptcy, it listed $693,492,000 in total assets and $638,086,000 in total debts. STEVE & BARRY'S: Court Orders Payment for Laird Hamilton Royalty ---------------------------------------------------------------- (Louie) The United States Bankruptcy Court for the Southern District of New York has authorized and directed Steve and Barry's LLC and its debtor-affiliates to pay the $300,000 royalty payment of Laird Hamilton due under the Licensing Agreement between the Debtors and Flying Pigz LLC. The amount includes royalty payments incurred prepetition. In exchange of the receipt of the Royalty Payment, Flying Pigz waives any defenses and objections to the assumption and assignment by the Debtors of the Licensing Agreement based on (i) the terms of the agreement, (ii) the invocation of Section 365(c) of the Bankruptcy Code, and (iii) any argument that the agreement is a contract for "personal services," and is, therefore, not assignable in accordance with Section 365(c)(1). However, all of Flying Pigz's rights with respect to any other defenses or objections by any proposed assignee of the Licensing Agreement are preserved. Upon the closing and effectiveness of the Asset Purchase Agreement, dated August 4, 2008, between S&B Industries, Inc., and BH S&B Holdings, LLC, and provided that the Licensing Agreement will be classified as a "Purchased Contract" under the BH Purchase Agreement, Flying Pigz will be deemed to (i) consent to the assumption and assignment of the License Agreement by the Debtors to BH S&B Holdings, and (ii) have received "adequate assurance of future performance" with respect to the assignment. The objection of PrenSB, LLC has been overruled. As previously reported, the Court has authorized and directed the payment of the $250,000 royalty payment of Venus Williams. The Court also recently entered a separate written order with respect to Ms. Williams. Headquartered in Port Washington, New York, Steve and Barry LLC -- http://www.steveandbarrys.com/-- is a national casual apparel retailer that offers high quality merchandise at low prices for men, women and children. Founded in 1985, the company operates 276 anchor and junior anchor shopping center and mall-based locations throughout the U.S. At STEVE & BARRY'S (R) stores, shoppers will find brands they can't find anywhere else, including the BITTEN(TM) collection, the first-ever apparel line created by actress and global fashion icon Sarah Jessica Parker, and the STARBURY(TM) collection of athletic and lifestyle apparel and sneakers created with NBA (R) star Stephon Marbury. Steve & Barry's, LLC, and 63 affiliates filed separate voluntary petitions under Chapter 11 on July 9, 2008 (Bankr. S.D. N.Y. Lead Case No. 08-12579). Lori R. Fife, Esq., and Shai Waisman, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. Diana G. Adams, United States Trustee for Region 2, has appointed seven members to the Official Committee of Unsecured Creditors in the Debtors' Chapter 11 cases. When the Debtors filed for bankruptcy, it listed $693,492,000 in total assets and $638,086,000 in total debts. STEVE & BARRY'S: Wants Conway to Provide Additional Services ------------------------------------------------------------ (Louie) Steve and Barry's LLC and its debtor-affiliates seek authority from the United States Bankruptcy Court for the Southern District of New York to amend their employment agreement with Conway, Del Genio, Gries & Co., LLC, to include additional financial services, specifically assisting the Debtors in: (a) identifying potential bidders; (b) creating a data room for diligence material; (c) overseeing due diligence to potential bidders; (d) negotiating with all bidders; (e) analyzing bids; and (f) conducting the auction. According to Steve & Barry's Manhattan LLC Chairman and Secretary Barry Prevor, the firm will be paid for the Additional Services and reimbursed of its expenses. The Debtors have agreed to pay Conway Del Genio a transaction fee contingent upon the consummation of a sale, and payable at the closing. Mr. Prevor says that the transaction fee will be 1% of the "Aggregate Consideration," offset by 50% of the total fees received by the firm since the beginning of the current engagement with the Debtors. Creditors Committee Objects to Amendment The Official Committee of Unsecured Creditors objects to the Debtors' amendment of their employment agreement with financial advisors, Conway Del Genio, Gries & Co., LLC, that provides for the reward of a success fee to the firm. The Creditors Committee states that the Debtors should not be authorized to pay the firm a success fee of $1,600,000 for assisting them with a 40-day sale process, which may ultimately leave the estates administratively insolvent. According to Cathy Hershcopf, Esq., at Cooley Godward Kronish LLP, in New York, while the sale to Bay Harbour Management LC was the best possible outcome under the circumstances, the sale proceeds alone provide no recovery for general unsecured creditors. The proposed fee is high in light of the work performed by Conway Del Genio and would be paid at the expense of administrative and priority creditors of the estates, who provided and continue to prove valuable products and services to the Debtors, Ms. Hershcopf argues. Headquartered in Port Washington, New York, Steve and Barry LLC -- http://www.steveandbarrys.com/-- is a national casual apparel retailer that offers high quality merchandise at low prices for men, women and children. Founded in 1985, the company operates 276 anchor and junior anchor shopping center and mall-based locations throughout the U.S. At STEVE & BARRY'S (R) stores, shoppers will find brands they can't find anywhere else, including the BITTEN(TM) collection, the first-ever apparel line created by actress and global fashion icon Sarah Jessica Parker, and the STARBURY(TM) collection of athletic and lifestyle apparel and sneakers created with NBA (R) star Stephon Marbury. Steve & Barry's, LLC, and 63 affiliates filed separate voluntary petitions under Chapter 11 on July 9, 2008 (Bankr. S.D. N.Y. Lead Case No. 08-12579). Lori R. Fife, Esq., and Shai Waisman, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. Diana G. Adams, United States Trustee for Region 2, has appointed seven members to the Official Committee of Unsecured Creditors in the Debtors' Chapter 11 cases. When the Debtors filed for bankruptcy, it listed $693,492,000 in total assets and $638,086,000 in total debts. SWANSEA PROPERTIES: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Swansea Properties LLC 6028 N. 129th Ave. Litchfield Park, AZ 85340 Bankruptcy Case No.: 08-11486 Chapter 11 Petition Date: August 29, 2008 Court: District of Arizona (Phoenix) Judge: Charles G. Case II Debtor's Counsel: James E. Cross Osborn Maledon P.A. 2929 N. Central Ave. No. 2100 Phoenix, AZ 85012 Tel (602) 640-9307 Fax (602) 664-2077 Email jcross@omlaw.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of its largest unsecured creditors. THORNBURG MORTGAGE: May Not be Able to Continue Operating --------------------------------------------------------- ABI World reports that Thornburg Mortgage Inc. admitted that its survival remained in doubt following additional margin calls. However, Thornburg Mortgage said it is on track to complete a restructuring and avoid collapse, ABI World states. About Thornburg Mortgage Inc. Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA) -- http://www.thornburgmortgage.com/-- is a single-family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable- rate mortgages. It originates, acquires, and retains investments in adjustable and variable rate mortgage assets. Its ARM assets comprise of purchased ARM assets and ARM loans, including traditional ARM assets and hybrid ARM assets. At March 31, 2008, the company's consolidated balance sheet showed $30.8 billion in total assets, $31.9 billion in total liabilities, and $1.0 billion in preferred stock, resulting in a $2.1 billion stockholders' deficit. * * * As reported in the Troubled Company Reporter on June 27, 2008, Moody's Investors Service affirmed Ca and C senior debt and preferred stock ratings, respectively of Thornburg Mortgage Inc. Thornburg's Ca debt rating remains under review for possible downgrade. Moody's said that Thornburg's efforts to raise capital to avoid default under its repo agreements have resulted in the reconfiguration of its balance sheet with adverse impact on its debt and preferred equity holders. TWEETER HOME: Wants Plan Filing Extended Until December 2 --------------------------------------------------------- Tweeter Home Entertainment Group Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to further extend the time within which they may file a plan of reorganization until December 2, 2008, and solicit acceptances of that plan until February 2, 2009. The Debtors' current Plan filing deadline expires on September 3, 2008, and their solicitation deadline on November 5, 2008. Sarah E. Pierce, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Wilmington, Delaware, the Debtors have conducted a sale of their assets to maximize the value of their estates for the benefit of all the parties-in-interest. The Debtors, together with their professionals, also worked to implement procedures to comply with the substantial reporting and disclosure requirements imposed on debtors-in-possession. In addition, the Debtors were compelled to address the demands of customers, vendors, employees and other parties-in-interest to preserve the going concern value of their businesses. The efforts of the Debtors and their professionals culminated in the Sale of their assets to Tweeter Newco, LLC, which sale closed on July 13, 2007. Given the Debtors' substantial efforts since the Petition Date, they believe that they should be granted additional time to develop a plan without the distraction of competing plans filed by other parties. Moreover, since the Petition Date, the Debtors have attempted to quantify the amount of their existing administrative, priority, and unsecured claims against their estates but they have not completed the analysis yet. Thus, additional time is required for them to review and analyze the claims. The Debtors believe that they will require additional time to review and analyze the validity, amount and priority of those claims that have been asserted against their estates and that were not assumed or will not be satisfied by the Purchaser pursuant to the terms of the Asset Purchase Agreement, dated June 26, 2007. Moreover, the Purchaser retains certain designation rights under the terms of the Purchase Agreement. Since the Closing Date, the Debtors have assumed and assigned numerous contracts and leases to the Purchaser and have resolved certain disputed issues between the Purchaser and the Debtors. Ms. Pierce avers in light of the ongoing efforts of the Debtors and their professionals, they need additional time to develop and negotiate a plan of liquidation and a disclosure statement. The extension will also provide the Debtors and opportunity to analyze their post-sale financial circumstances and develop a liquidating plan that maximizes the return to parties-in- interest, she adds. The Court will convene a hearing on October 20, 2008, to consider approval of the Debtors' request. By application of Rule 9006-2 of the Local Rules of Bankruptcy Practice and Procedures of the United States Bankruptcy Court for the District of Delaware, the Exclusive Plan Proposal Period is automatically extended until the conclusion of the hearing. About Tweeter Home Based in Canton, Mass., Tweeter Home Entertainment Group Inc. -- http://www.tweeter.com/-- retails mid-to high-end audio and video consumer electronics products. Tweeter and seven of its affiliates filed for chapter 11 Protection on June 11, 2007 (Bankr. D. Del. Case Nos. 07-10787 through 07-10796). Gregg M. Galardi, Esq., Mark L. Desgrosseilliers, Esq., and Sarah E. Pierce, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represent the Debtors. Kurtzman Carson Consultants LLC acts as the Debtors' claims and noticing agent. Bruce Grohsgal, Esq., William P. Weintraub, Esq., and Rachel Lowy Werkheiser, Esq., at Pachulski Stang Ziehl & Jones LLP; and Scott L. Hazan, Esq., Lorenzo Marinuzzi, Esq., and Todd M. Goren, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., represent the Official Committee of Unsecured Creditors. As of Dec. 21, 2006, Tweeter had total assets of $258,573,353 and total debts of $190,417,285. The Debtors exclusive period to file a plan of reorganization expired on June 5, 2008. (Tweeter Bankruptcy News, Issue No. 22, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TWEETER HOME: Anne David Wants Automatic Stay Lifted ---------------------------------------------------- Anne David is seeking recovery from the proceeds of Tweeter Home Entertainment Group Inc. and its debtor-affiliates' insurance policies for the multiple injuries she sustained after having tripped on a raised edge of pavement while walking toward the parking lot at one of the Debtors' store in Towson, Maryland. According to Ms. David, she incurred approximately $23,680 in medical expenses for her injuries. Pursuant to Section 362 of the Bankruptcy Code, Ms. David asks the U.S. Bankruptcy Court for the District of Delaware to lift the automatic stay for the purpose of liquidating her claims against the Debtors and their insurance policies. Ms. David says she is seeking recovery only from the proceeds of the Debtors' insurance policies. About Tweeter Home Based in Canton, Mass., Tweeter Home Entertainment Group Inc. -- http://www.tweeter.com/-- retails mid-to high-end audio and video consumer electronics products. Tweeter and seven of its affiliates filed for chapter 11 Protection on June 11, 2007 (Bankr. D. Del. Case Nos. 07-10787 through 07-10796). Gregg M. Galardi, Esq., Mark L. Desgrosseilliers, Esq., and Sarah E. Pierce, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represent the Debtors. Kurtzman Carson Consultants LLC acts as the Debtors' claims and noticing agent. Bruce Grohsgal, Esq., William P. Weintraub, Esq., and Rachel Lowy Werkheiser, Esq., at Pachulski Stang Ziehl & Jones LLP; and Scott L. Hazan, Esq., Lorenzo Marinuzzi, Esq., and Todd M. Goren, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., represent the Official Committee of Unsecured Creditors. As of Dec. 21, 2006, Tweeter had total assets of $258,573,353 and total debts of $190,417,285. The Debtors exclusive period to file a plan of reorganization expired on June 5, 2008. (Tweeter Bankruptcy News, Issue No. 22, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). UNIVERSAL NURSING: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Universal Nursing Services, Inc. 402 East Market Street Akron, OH 44304 Bankruptcy Case No.: 08-53163 Type of Business: The Debtor is into home health care business. Chapter 11 Petition Date: August 29, 2008 Court: Northern District of Ohio (Akron) Judge: Marilyn Shea-Stonum Debtor's Counsel: Morris H. Laatsch, Esq. Hardesty, Kaffen & Zimmerman 520 South Main Street, Suite 500 Akron, OH 44311 Tel: (330)762-7477 Email: jwander@hkz-law.com Total Assets: $471,898 Total Debts: $2,822,660 A copy of the Debtor's petition that contains the list of its 20 Largest Unsecured Creditors is available at: http://bankrupt.com/misc/ohnb08-53163.pdf US DATAWORKS: Reports $109,481 Net Loss for Quarter Ended June 30 ----------------------------------------------------------------- US Dataworks Inc.'s consolidated balance sheet at June 30, 2008, showed $7,147,620 in total assets and $4,448,862 in total liabilities, resulting in a $2,698,758 total stockholders' deficit. The company reported a net loss of $109,481 on net revenues of $2,069,049 for the quarter ended June 30, 2008, compared with a net loss of $869,264 on net revenues of $1,229,071 in the same period last year. According to the company's regulatory filing with the Securities and Exchange Commission, although the company has enough cash to fund its operation until March 31, 2009, however, it may need to raise additional capital in the future. Any equity financing may be dilutive to shareholders, and debt financing, if available, will increase expenses and may involve restrictive covenants. The company may be required to raise more capital, at times and in amounts that are uncertain, especially under the current capital market conditions. These factors raise substantial doubt about its ability to continue as a going concern. Under these circumstances, it may have adverse effect on the company's financial condition if it is unable to obtain more capital. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2008, are available for free at http://ResearchArchives.com/t/s?3182 About US Dataworks US Dataworks, Inc. (AMEX: UDW) -- http://www.usdataworks.com/-- develops, markets, and supports payment processing software for the financial services industry. Its customer base includes many of the largest financial institutions as well as credit card companies, government institutions, and high-volume merchants in the United States. It has strategic partnerships with Computer Sciences Corporation, Chase Paymentech Services, eGistics, and Accuity. The company was founded in 1994 and is based in Sugar Land, Texas. VERENIUM CORP: Posts $16.4 Million Net Loss in 2008 Second Quarter ------------------------------------------------------------------ Verenium Corp. reported financial results for the second quarter of 2008 and provided recent company highlights and accomplishments. Net loss for the second quarter and six months ended June 30, 2008 was $16.4 million and $39.7 million, respectively. This compares to a net loss for the second quarter and six months ended June 30, 2007 of $55.2 million, and $65.5 million, respectively. Net loss for the second quarter and first half of 2007 includes a non-cash in-process research and development charge of $42.4 million. Excluding this charge, net loss for the second quarter and first half of 2007, on a non-GAAP basis, increased as compared to the same periods in 2008. This increase was attributable primarily to incremental operating expenses related to the inclusion of Celunol's business from the June 2007 merger, as well as incremental interest and other expenses related to the company's convertible notes issuance in February 2008. These increases were offset in part by an increase in product revenue and related gross profit in 2008. "We are very pleased to report a most productive second quarter and successful first half of the year for Verenium," Carlos A. Riva, President and Chief Executive Officer of Verenium, said. "As announced, our corporate partnership with BP marks a major accomplishment and transformational event for Verenium, moving us closer delivering on our vision of making cellulosic ethanol a commercial reality." Total revenues for the second quarter and six months ended June 30, 2008 were $18.3 million and $33.5 million, respectively, compared to $11.1 million and $22.4 million for the same periods in 2007. The increase in total revenue resulted from solid growth in product revenue, offset in part by a decrease in collaborative revenue, consistent with earlier guidance provided by the company. The company reported product revenue of $13.4 million and $24.6 million, respectively, in the second quarter and first half 2008, representing a 121% and 116% increase compared to the same periods in 2007. The increase in product revenue was primarily due to increased sales of Phyzyme(R) XP by Danisco Animal Nutrition, which continues to grow globally in the animal feed industry. The company also experienced solid sales growth for its other enzyme products, including Fuelzyme(R)-LF, the company's alpha amylase product sold directly by Verenium's own sales team into the corn- based ethanol industry. For the first half of 2008, the company also reported $2.4 million in product revenue from two discontinued products, Bayovac(R) and Quantum(R), which will not occur in future quarters. Product revenue accounted for 73% of total revenue during the second quarter and first half of 2008, respectively, compared to 54% and 51% during the same periods in 2007, respectively. Product gross profit (product revenue less cost of product revenue) and product gross margin (product gross profit divided by product revenue) improved in the first half of 2008 as compared to the first half of 2007 due primarily to growth in Phyzyme sales, as well as incremental margin improvement contributed by other product growth. The company's product gross margin is still subject to quarterly fluctuations resulting from variability in product mix, manufacturing yields due to continued commercial scale-up of Phyzyme and Fuelzyme, and fixed manufacturing costs as the company takes on additional capacity to meet customer demand. Over time, the company believes that product volume growth and a higher mix of company-marketed products in the portfolio should yield improvement in both product gross profit and margin. Total operating expenses were lower in the second quarter and first half of 2008 compared to the same periods in 2007 primarily due to a one-time, non-cash charge of $42.4 million in June 2007 for in-process research and development related to the merger with Celunol. Excluding the impact of this charge, on a non-GAAP basis, total operating expenses in the second quarter and first half of 2008 increased compared to the same periods in 2007 related primarily to the incremental operating expenses associated with inclusion of the company's Biofuels business since its June 2007 merger with Celunol. Approximately $0.9 million of the increase in Selling, General and Administrative expense between the first half of 2008 and 2007 resulted from increased legal expenses that represent levels not expected to continue through the balance of the year. Additionally, for the second quarter and first half of 2007, approximately $1.1 million and $2.3 million, respectively, in expenses related to the company's intellectual property and regulatory activities were reclassified from Research and Development expense to Selling, General and Administrative Expense in order to conform to the 2008 classification of these expenses. Non-cash, stock-based compensation expense included in operating expenses, (apportioned at roughly 40% to Research and Development and 60% to Selling, General and Administrative expenses) for the second quarter and first half of 2008 was $2.7 million and $6.2 million, respectively, compared to $2.3 million and $3.3 million for the same periods in 2007. The increase in stock-based compensation was related primarily to additional options granted during 2007 in connection with the Celunol merger, together with additional equity awards granted since that time. In February 2008, the company announced the completion of a private placement of 8% convertible notes and warrants which generated net cash proceeds of approximately $45 million. Pursuant to applicable accounting rules, the company is required to bifurcate certain derivative features of these notes and measure them at fair value on a quarterly basis. The change in fair value of these bifurcated derivative features is included as a separate line item on the consolidated statements of operations. As of June 30, 2008, the company had cash, cash equivalents, and short-term investments totaling $19.5 million, excluding approximately $10 million in restricted cash. At June 30, 2008, the company's balance sheet showed total assets of $275.1 milllion and total liabilities of $186.3 million, resulting in a stockholders' equity of $88.7 million. Company Highlights and Accomplishments Verenium and BP entered into a significant strategic partnership to accelerate the development and commercialization of cellulosic ethanol technologies. The partnership combines a broad technology platform and strong operational capabilities in an effort to advance the development of a portfolio of low-cost, environmentally-sound cellulosic ethanol production facilities in the United States, and potentially throughout the world. The first phase of Verenium's partnership with BP is focused on accelerating Verenium's technology and production facility initiatives as the foundation for future development of a portfolio of commercial-scale cellulosic ethanol facilities. In this first phase, BP has committed to $90 million of total funding over the next 18 months for its participation rights in the 50/50 partnership with Verenium, as well as co-funding obligations to support Verenium's Biofuels technology development initiatives. Payment terms are: * $45 million in unconditional payments for BP's participation rights in the partnership; of this total, $24.5 million is payable within 10 days of closing, $6.5 million is payable on Jan. 2, 2009, and $14 million is payable on July 2, 2009. * $2.5 million per month for 18 months to co-fund Verenium's Biofuels technology development initiatives. For the five months remaining in 2008, the $2.5 million per month obligation will be accrued and paid fully on Jan. 2, 2009. Thereafter, the monthly funding will be paid on the first of every month. As such, on Jan. 2, 2009, Verenium will be paid a total of $21.5 million, comprising $15 million for the five-month co-funding accrual including the January payment, as well as $6.5 million related to BP's development funding obligation. As part of the partnership, the companies have formed a Special Purpose Entity, equally owned by Verenium and BP, that will serve as the entity into which current technologies owned by the companies within the cellulosic ethanol field will be in-licensed, and new technologies jointly developed by Verenium and BP will be owned by the SPE. All intellectual property owned prior to the formation of the partnership, and licensed into the SPE, will be retained by each respective company. The SPE will serve as the licensing entity enabling commercial cellulosic ethanol production projects. The relationship will be governed by a Joint Development Agreement and managed by a Joint Steering Committee with equal representation from Verenium and BP. About Verenium Corp. Based in Cambridge, Massachusetts, Verenium Corporation (Nasdaq: VRNM) -- http://www.verenium.com/-- is engaged in the development and commercialization of next-generation cellulosic ethanol, an environmentally-friendly and renewable transportation fuel, as well as high-performance specialty enzymes for applications within the alternative fuels, specialty industrial processes, and animal nutrition and health markets. Going Concern/Possible Bankruptcy As reported in the Troubled Company Reporter on April 1, 2008, Ernst & Young LLP, in San diego, expressed substantial doubt about Verenium Corporation's ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2007. The auditing firm pointed to the company's recurring operating losses and accumulated deficit of $437.1 million at Dec. 31, 2007. Based on the company's operating plan, its existing working capital is not sufficient to meet the cash requirements to fund the company's planned operating expenses, capital expenditures, and working capital requirements through Dec. 31, 2008, without additional sources of cash or the deferral, reduction or elimination of significant planned expenditures. The company's plan to address the expected shortfall of working capital is to generate additional financing through a combination of corporate partnerships and collaborations, federal and state grant funding, incremental product sales, selling or financing assets, and, if necessary and available, the sale of equity or debt securities. If the company is unsuccessful in raising additional capital from any of these sources, it will defer, reduce, or eliminate certain planned expenditures. The company said it will continue to consider other financing alternatives including but not limited to, a divesture of all or part of its business. If the company cannot obtain sufficient additional financing in the short-term, it may be forced to restructure or significantly curtail its operations, file for bankruptcy or cease operations. VILLA DEL SOL : Case Summary & 1 Largest Unsecured Creditor ----------------------------------------------------------- Debtor: Villa Del Sol at Cape San Blas LLC 6230 Shiloh Road, Ste. 200 Alpharetta, GA 30004 Bankruptcy Case No.: 08-40589 Chapter 11 Petition Date: August 29, 2008 Court: Northern District of Florida (Tallahassee) Debtor's Counsel: Thomas B. Woodward, Esq. P.O. Box 10058 Tallahassee, FL 32302 Tel (850) 222-4818 Fax 850-561-3456 Email woodylaw@embarqmail.com Total Assets: $27,260,000 Total Debts: $16,508,031 Debtor's List of Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Lighthouse Utilities Co. Inc. Electric Service $8,031 P.O. Box 428 Port Saint Joe, Fl 32457 VISUAL MANAGEMENT: June 30 Balance Sheet Upside-Down by $3.88 Mil. ------------------------------------------------------------------ Visual Management Systems Inc.'s consolidated balance sheet at June 30, 2008, showed $4,733,638 in total assets and $8,621,442 in total liabilities, resulting in a $3,887,804 total stockholders' deficit. At June 30, 2008, the company's consolidated balance sheet also showed strained liquidity with $842,919 in total current assets available to pay $4,990,960 in total current liabilities. The company reported a net loss of $1,527,469, on net revenues of $1,635,516 for the first quarter ended June 30, 2008, compared with a net loss of $970,988 on net revenues of $1,438,272 in the same period last year. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2008, are available for free at http://ResearchArchives.com/t/s?317f Going Concern Doubt Sobel & Co., LLC, in Livingston, N.J., expressed substantial doubt about Visual Management Systems Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2007. The auditing firm stated that the company has suffered recurring losses from operations, has experienced a deficiency of cash from operations, and lacks sufficient liquidity to continue its operations. About Visual Management Based in Toms River, N.J., Visual Management Systems Inc. (OTC BB: VMSY) -- http://www.vmscctv.com/-- engages in the design, sale, and installation of digital surveillance systems. WESTERN NONWOVEN: Fire Retardant Business Acquired by Milliken -------------------------------------------------------------- Fibre2fashion.com reports that Milliken & Company disclosed on Friday that it has acquired Western Nonwovens Inc.'s fire retardant barrier assets and geotextile business out of Chapter 11 bankruptcy. The transaction was consummated through one of Milliken's wholly owned subsidiaries. As reported in the Troubled Company Reporter on Aug. 27, 2008, the Hon. Peter J. Walsh of the United States Bankruptcy Court for the District of Delaware approved the sale of certain assets of Western Nonwovens Inc. to Sylvan Chemical Company for $11.2 million. Bloomberg News reported that Sylvan Chemical's bid was $6 million more than the stalking-horse bidder's offer. The Court also approved the sale of the Debtor's other assets -- including inventory and intellectual property -- to Harvest Consumer Insulation Inc. for $1.05 million. A full-text copy of the Sylvan Asset Purchase Agreement dated Aug. 20, 2008, is available for free at: http://ResearchArchives.com/t/s?3133 About Western Nonwovens Headquartered in Carson, California, Western Nonwovens, Inc. -- http://www.westernnonwovens.com-- manufactures nonwoven materials and provides services to industries, including mattress, automotive, retail apparel, filtration and furniture manufacturers. Western Nonwovens Inc. and seven of its affiliates filed voluntary petitions under Chapter 11 on July 14, 2008 (Bankr. D. Del., Case No. 08-11435). Representing the Debtors is Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware. The U.S. Trustee for Region 3 appointed creditors to serve on an Official Committee of Unsecured Creditors. Hahn & Hessen LLP and Montgomery McCraken Walker & Rhoads LLP represent the Committee in this cases. The Debtor selected Epiq Bankruptcy Services LLC as its claims agent. When the Debtor filed for protection against its creditors, it listed assets of $28.4 million and debts of $106.9 million. WR GRACE: Can Implement 2008-2010 Incentive Plan ------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware granted W.R. Grace & Co. permission to implement its 2008-2010 long-term incentive plan for certain key employees, BankruptcyData.com reports. David M. Bernick, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, had told the Court that the Debtors' long-standing strategy for its long-term incentive program requires a renewed LTIP each calendar year, with no more than three LTIPs in effect in any year. The Debtors proposed to continue their long-term incentive program strategy by implementing the 2008-2010 LTIP, which will be similar to their former LTIPs, with two exceptions: (1) the total targeted value of awards under the 2008-2010 LTIP, which will be comprised of potential cash payouts plus stock option awards, will be increased to $15,800,000 excluding the CEO, to reflect the recommendations of the Compensation Committee's compensation consultant as necessary to provide long- term incentive opportunities at or about the 60th percentile of the opportunities provided by the Debtors' industry peer group; and (2) the 2008-2010 LTIP will include awards of stock options for shares of the Debtors' parent, W.R. Grace & Co. According to Mr. Bernick, the total targeted value of the award under the 2008-2010 LTIP for the CEO will remain unchanged from the prior LTIPs, at approximately $1,700,000. The targeted value will be comprised of potential cash payouts plus a stock option award, determined under the same provisions as applicable to 2008- 2010 LTIP awards to other key employees. The aggregate targeted long-term incentive award value applicable to the prior LTIPs has remained unchanged since the Debtors implemented the initial LTIP in 2002, with an aggregate targeted award of $11,800,000, excluding their CEO. Mr. Bernick explained that the 2008-2010 LTIP is designed so that the amount of the cash component of the target awards to Key Employees will equal 50% of the total targeted award that the key employee received or would have received under the 2007-2009 LTIP. Cash awards to key employees will be made in 1/3 and 2/3 installments in 2010 and 2011. The total aggregate cash awards, if earned, under the 2008-2010 LTIP, including the CEO, would be: Cash Payout ----------------------- Year Targeted Maximum ----- ---------- ---------- 2010 $2,250,000 $2,250,000 2011 4,500,000 11,250,000 ----- ---------- ---------- Total $6,750,000 $13,500,000 The Debtors anticipate granting options covering approximately 1,700,000 to 2,200,000 shares of Grace Stock, under the 2008-2010 LTIP. The "strike price" of the stock options awarded under the 2008-2010 LTIP will be the market price of Grace Stock as of the award date. One half of the awarded stock options would vest in March 2010, and the remaining half would vest in March 2011. The stock options would generally be exsercisable for a period of five years after grant. The performance criteria for the cash awards portion of the 2008- 2010 LTIP are essentially the same as the provisions of the previous LTIPs, Mr. Bernick told the Court. The Debtors believe that increasing the total targeted value of awards under the 2008-2010 LTIP from the levels of the prior LTIPs is necessary to maintain a competitive and meaningful incentive program to continue to motivate key employees to perform at a high level. Mr. Bernick said an analysis conducted by the Debtors' Compensation Consultant has concluded that their long-term incentive award opportunities have fallen behind those implemented by their industry peer group. He adds that none of the Debtors' former LTIPs included any award of stock options or other equity-based incentives. The Debtors have not issued any equity-based incentives to key employees since filing for Chapter 11 protection on April 2, 2001, he relates. The Debtors believe that, at this point in their Chapter 11 cases, it is appropriate to reintroduce stock option awards as part of their long-term incentive plans. About W.R. Grace Headquartered in Columbia, Md., W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. The Debtors filed their Chapter 11 Plan and Disclosure Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan and Disclosure Statement. The hearing to consider the adequacy of the Debtors' Disclosure Statement began on Jan. 21, 2005. The Debtors' exclusive period to file a chapter 11 plan expired on July 23, 2007. Estimation of W.R. Grace's asbestos personal injury liabilities commenced on January 14, 2008. At Dec. 31, 2006, the W.R. Grace's balance sheet showed total assets of $3,620,400,000 and total debts of $4,189,100,000. As of November 30, 2007, W.R. Grace's balance sheet showed total assets of $3,335,000,000, and total debts of $3,712,000,000. (W.R. Grace Bankruptcy News, Issue No. 162; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * D'Aversa Joins Orrick Herrington from Mayer Brown --------------------------------------------------- Orrick, Herrington & Sutcliffe LLP said Raniero D'Aversa, Jr. has joined the firm as a partner and head of its New York creditors' rights and bankruptcy practice. D'Aversa has joined the firm from Mayer Brown LLP, where he served as the co-chair of its global restructuring, bankruptcy and insolvency group. "Ron's addition to our bankruptcy group will bring tremendous depth to the firm, particularly in the New York market, the expansion of which is a high priority of the firm," said Roger Frankel, chairman of Orrick's creditors' rights and bankruptcy group. "His reputation, especially within the bankruptcy community, and his experience representing institutional clients in all bankruptcy-related areas are a welcome addition to our growing practice." D'Aversa's practice includes representing clients involved in bankruptcies, out-of-court restructurings and creditors' rights controversies. He provides comprehensive legal guidance to DIP lenders, secured lenders and bank groups, investment banks, hedge funds and other financial institution creditors in bankruptcies, workouts, restructurings, liquidations, distressed debt transactions and acquisitions. "Orrick is a great place for the practice I've developed," said D'Aversa. "What most attracted me to Orrick is the depth of its client base, particularly with respect to financial institutions, its global presence and its interdisciplinary team of lawyers in litigation and finance who can provide exceptional support on any matter." D'Aversa received his J.D. from New York University School of Law in 1990 and his B.B.A from Adelphi University, summa cum laude, in 1987. His addition follows the recent arrival of Mark Fennessy, the former head of Hunton & Williams' corporate restructuring and insolvency group in London. Orrick, Herrington & Sutcliffe -- http://www.orrick.com-- is one of California's oldest law firms. It is based in San Francisco. Among its practice areas are public finance, litigation, securities, tax, and intellectual property. Orrick has some 980 lawyers in about 20 offices in the U.S., as well as in the Asia/Pacific region, and Europe. ********* 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. 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. Sheryl Joy P. Olano, Shimero R. Jainga, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, Joseph Medel C. Martirez, Ma. Cristina I. Canson, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2008. 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 ***