/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/090804.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, August 4, 2009, Vol. 13, No. 214 Headlines A & M FLORIDA: Voluntary Chapter 11 Case Summary ABELAR COELHO: Voluntary Chapter 11 Case Summary ADAM VOLZ: Case Summary & 3 Largest Unsecured Creditors ADVENTRX PHARMACEUTICALS: NYSE Accepts Listing Compliance Plan AFFILIATED FOODS: Bankruptcy Wipes Out $34MM in Investments AFFIRMATIVE EQUITIES: Will Auction Off Patrick Henry Hotel AGFC CAPITAL: Moody's Cuts Preferred Stock Rating to 'Ba3' AIRPORT CHURCH: Case Summary & 5 Largest Unsecured Creditors ALLIS-CHALMERS ENERGY: Swings to $90,000 Net Loss for Q2 2009 AMBAC ASSURANCE: S&P Corrects Sevier Airport Revenue Bond Ratings AMERICAN INT'L: Board Names Robert Benmosche President & CEO AMERICAN LOCKER: Inks Receivables Purchase Deal with Gulf Coast AMR CORP: Unit Closes $276 Million Private Debt Sale AMR CORP: Fitch Affirms Issuer Default Rating at 'CCC' AROMAS-SAN JUAN: Fitch Affirms 'BB+' Rat6ing on $11.5 Mil. Bonds ARRAYIT CORP: Berman Hopkins Raises Going Concern Doubt ARROWHEAD GENERAL: S&P Affirms Junks Rating on 2nd-Lien Sec. Debt ASARCO LLC: Vedanta Won't Beef Up Offer for Assets BABCOCK QUARTER: Has Until Aug. 7 to File Schedules & Statements BABCOCK QUARTER: Meeting of Creditors Scheduled for August 21 BALTIMORE MAYOR: S&P Gives Negative Outlook on 2006-B Bonds BAMBOO ABBOTT: Meeting of Creditors Scheduled for September 17 BANK OF AMERICA: Pays $33MM to Settle SEC Suit on Merrill Bonuses BANKUNITED FINANCIAL: Common Stock Delisted by Nasdaq BCH LAND HOLDING: Case Summary & 8 Largest Unsecured Creditors BERNARD MADOFF: Picower Seeks Dismissal of Trustee Fraud Claims BRAINTECH INC: EVP Osborn to Get Stock for July-Sept. Salary BRAINTECH INC: Gets $3MM SVB and $1.5MM 60-Day Credit Facilities BRSP LLC: S&P Changes Outlook to Negative; Retains 'CC' Rating C & L LOFTS: Case Summary & 4 Largest Unsecured Creditors CABINET DOOR: Case Summary & 20 Largest Unsecured Creditors CALPINE CORP: Court Approves Settlement With Noteholders CASTLE MEGASTORE: Emerges from Chapter 11; Names Franks as CEO CELL THERAPEUTICS: Files Monthly Update at CONSOB's Directive CELL THERAPEUTICS: Registers 8,432,981 Shares of Common Stock CENTERLINE CAPITAL: S&P Affirms Counterparty Rating at 'B+' CIT GROUP: Raises Offer to 87.5 Cents on the Dollar COLONIAL BANCGROUP: Fitch Downgrades Issuer Default Rating to 'C' CONSTELLATION ENERGY: Fitch Downgrades Junior Notes to 'BB+' CONTINENTAL AIRLINES: Fitch Affirms Issuer Default Rating at 'B-' COOPER-STANDARD: Files Chapter 11 to Restructure Balance Sheet COOPER-STANDARD: Case Summary & 30 Largest Unsecured Creditors COREL CORP: Hagerman Assumes CEO Post on Permanent Basis COYOTES HOCKEY: Glendale Can Keep Some Negotiation Files Private COYOTES HOCKEY: Jerry Reinsdorf's Bid Gets NHL's Approval CRESCENT RESOURCES: U.S. Trustee Appoints 6 Members to Panel CRESCENT RESOURCES: Committee Retains Martine Winn as Counsel CRESCENT RESOURCES: Top Executives Got $9.2MM Before Bankr. Filing CRISMON CAPITAL: Voluntary Chapter 11 Case Summary D & L SALES: Case Summary & 10 Largest Unsecured Creditors DBSI INC: Interim Report on Fraud Probe to Be Released Today DELTA AIR LINES: Air New Zealand Opposes Delta-Virgin Tie Up DELTA AIR LINES: Bastian Disposed Of 20,000 Delta Shares July 28 DELTA AIR LINES: Techops and Hawaiian Air Have Support Pact DETROIT PUBLIC SCHOOLS: Bankruptcy is Worst Option, Union Says DHP HOLDINGS: Hires Landis Rath as Special Litigation Counsel DONALD WOLSEY BARRETT: Case Summary & 20 Largest Unsec. Creditors DUANE READE: Posts $11.6 Million Net Loss for Q2 2009 DUANE READE: Unveils Pricing of 11.75% Sr. Sec. Notes Offering ELECTROGLAS INC: Can Hire Pepper Hamilton as Bankruptcy Counsel ELECTROGLAS INC: U.S. Trustee Appoints Three to Creditors' Panel ELEMENT ALUMINUM: Case Summary & 20 Largest Unsecured Creditors ELLIS BROWN: Case Summary & 20 Largest Unsecured Creditors ELLSRAY CAPITAL LLC: Voluntary Chapter 11 Case Summary ENERGY PARTNERS: Court Confirms Plan; In Talks for Exit Financing ERNIE HAIRE: Accepting Bids for Assets Until August 14 F.D. WILSON TRUCKING: Case Summary & 20 Largest Unsec. Creditors FAIRPOINT COMMUNICATIONS: Fitch Cuts Issuer Default Rating to 'RD' FAIRPOINT COMMUNICATIONS: S&P Cuts Corporate Credit Rating to 'SD' FINLAY ENTERPRISES: May Have Bids in Advance of Possible Filing FIRSTBANK PUERTO: Moody's Reviews Ba1 Deposit Rating FLORIDA YACHT: Case Summary & 20 Largest Unsecured Creditors FORTICELL BIOSCIENCE: Wants Court to Dismiss Chapter 11 Case FONTAINEBLEAU: Committee Retains Fox Rothschild as Co-Counsel FONTAINEBLEAU: Committee Retains Genovese as Co-Counsel FONTAINEBLEAU: Proposes to Reject 33 Employment And Sales Pacts FONTAINEBLEAU: Proposes to Reject Town Square Lease FONTAINEBLEAU: Sued by Turnberry West to Assert Liens FOOTHILLS RESOURCES: Court Declines to Approve Employee Bonuses FORD MOTOR: Reports First Auto Sales Increase in 2009 FOUNDATION COAL: Moody's Confirms 'Ba2' Corporate Family Rating FREMONT GENERAL: Files Investment Incentive Plan for 2007 and 2008 FRONTIER AIRLINES: Bidders' Final Proposals Due August 10 FRONTIER AIRLINES: Gives Information on Directors FRONTIER AIRLINES: Proposes Morgan Stanley Fuel Supply Contract GENERAL MOTORS: ACE American Wants Prompt Decision on Contract GENERAL MOTORS: Buyout Offer for UAW Workers Expires GENERAL MOTORS: ESIS Inc. Wants Prompt Decision on Agreement GENERAL MOTORS: Toyota to Liquidate Stake in Nummi JV GENERAL MOTORS: Opel May Be Sent to Bankr. Absent Sale Consensus GENOA HEALTHCARE: CEO Departure Won't Affect Moody's 'B2' Rating GEORGIA GULF: Completes Private Debt Exchange Offer GLEN SCOTT LANG: Case Summary & 13 Largest Unsecured Creditors GOODYEAR TIRE: 2Q Results on Track to Meet Expectations, S&P Says GPS INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors GREY GOOSE FARMS: Voluntary Chapter 11 Case Summary GTC BIOTHERAPEUTICS: Closes Securities Purchase Deal with LFB GTC BIOTHERAPEUTICS: Net Loss Widens to $10.8 Million in Q2 2009 HANGER ORTHOPEDIC: Moody's Upgrades Corp. Family Rating to 'B1' HANOVER INSURANCE: S&P Withdraws 'BB-' Rating on $300 Mil. Notes HARVEST ENERGY: S&P Downgrades Corporate Credit Rating to 'B-' HAWAII SUPERFERRY: Disclosure Statement Hearing Set for August 11 HAWAII SUPERFERRY: Files New Schedules of Assets and Liabilities HAWAII SUPERFERRY: Parent Files New Schedules of Assets & Debts HAWAII SUPERFERRY: Panel Taps Kelley Drye as Lead Counsel HAWAII SUPERFERRY: Panel Wants Atlantic Law as Local Counsel HAYES LEMMERZ: Gets Court Approval to Move Ahead With Barnes' Suit HAYES TENNESSEE: Voluntary Chapter 11 Case Summary HCA INC: Moody's Assigns 'Ba3' Rating on $750 Million Senior Notes HEADWATERS INC: S&P Downgrades Ratings on Convertible Notes to 'D' HOWARD GOLDSTEIN: Case Summary & 20 Largest Unsecured Creditors HRP MYRTLE: Counsel to Get $1 Mil.; Unsec. Creditors Get Nothing IMPLANT SCIENCES: Amends 2008 Annual Report to Address SEC Issues INDALEX HOLDINGS: Completes Sale to Sapa Holding ING CLARION: Fitch Affirms 'CSS2+' Special Servicer Rating INTERNATIONAL LEASE: Moody's Cuts Preferred Stock Rating to 'Ba2' JAYAMPATH DHARMASURIYA: Section 341(a) Meeting Set for August 20 JAYAMPATH DHARMASURIYA: US Trustee Wants to Convert Case to Ch. 7 JEVIC TRANSPORTATION: Sun Capital Can Remove Workers' Class Action JOHN MCMILLAN: Case Summary & 20 Largest Unsecured Creditors JOSE JUAN DIAZ ORTIZ: Voluntary Chapter 11 Case Summary KENNETH GWYNN: Case Summary & 20 Largest Unsecured Creditors LA JOLLA: U.S. Trustee Sets Meeting of Creditors for August 18 LANDMARK COMMUNITY: Loudoun Easterner Ceases Publication LAS VEGAS SANDS: Moody's Reviews 'B3' Corp. Rating for Downgrade LRC BATTERY CREEK: Case Summary & 20 Largest Unsecured Creditors LYONDELL CHEMICAL: Reaches Stipulation on Palms Action LYONDELL CHEMICAL: Sees September 30 Shutdown of Chocolate Bayou MAGNACHIP SEMICONDUCTOR: May Now Send Plan to Creditors MARK DESJEAN: Case Summary & 19 Largest Unsecured Creditors MAX LANG: Case Summary & 6 Largest Unsecured Creditors MEADOW INDEMNITY: Voluntary Chapter 15 Case Summary MERCER INT'L: Posts EUR11.4 Million Net Loss for Q2 2009 MERISANT WORLDWIDE: Court Orders Appointment of Fee Examiner MGM MIRAGE: Swings to $212.5 Million Net Loss in Q2 2009 MICHAEL SIZEMORE: Voluntary Chapter 11 Case Summary MILLENNIUM TRANSIT: Court Transfers Case to Judge James Starzynski MORRIS PUBLISHING: Lenders Cut Revolving Loan Commitment to $60MM MPG PARKLAND: Case Summary & 18 Largest Unsecured Creditors NORTH MIAMI: Case Summary & 20 Largest Unsecured Creditors OPUS WEST: Asks for Injunction Against Utilities OPUS WEST: Presents Bonus Program for Critical Employees OPUS WEST: Proposes to Pay Prepetition Employee Wages OWENS CORNING: Delaware Unit's 1st Quarter 2009 Summary Report OWENS CORNING: Judge Fitzgerald Resets Omnibus Hearing to Sept. 22 PACIFIC CAPITAL: $363 Mil. Loss Cues Moody's to Junk Issuer Rating PATRIOT HOMES: To Auction Texas and Indiana Properties PATRIOT HOMES: Wants DIP Termination Date Extended to August 28 PEOPLE AGAINST DRUGS: Thompson & Knight Replaces Strasburger PHOENIX WORLDWIDE: Files Schedules of Assets and Liabilities PLIANT CORP: Reaches Deal with Apollo on Chapter 11 Plan POMARE LTD: Can Obtain Up to $1 Million Under Credit Agreement POMARE LTD: Can Use Purchase Money Creditors' Cash Collateral PREGIS CORPORATION: Moody's Affirms 'B3' Corporate Family Rating PROTOSTAR LTD: Can Access $2MM of DIP Financing with Credit Suisse PROVIDENT ROYALTIES: Court Okays Sale Protocol; Bids Due August 18 QUEST RESOURCE: Amends 2008 Annual Report to Correct Errors QUEST RESOURCE: Files Sept. 2008 Qtr Report, 2007 Restatement RAINBOWS UNITED: Missed Over $2.3MM in Tax Payments for 2 Yrs. REFCO INC: Post-Confirmation Quarterly Report for Q2 2009 RHODE ISLAND HEALTH: S&P Affirms 'BB' Rating on 1998 Bonds RHODE ISLAND HEALTH: S&P Cuts Rating on 1999 Bonds to 'BB-' SENTINEL MANAGEMENT: Court Dismisses Suit Against Bank of New York SIRIUS INTERNATIONAL: Moody's Affirms Preferred Shares at 'Ba3' SPORTSMAN'S WAREHOUSE: Court Confirms 2nd Amended Joint Plan TEMECULA VALLEY BANCORP: To File Chapter 7 Petition by August 18 TEMECULA VALLEY BANCORP: Philip Guldeman Resigns as CFO TERPHANE HOLDING: Moody's Cuts Corporate Family Rating to 'Caa3' TORREYPINES THERAPEUTICS: Amends Employment Deal with CEO, et al. TORREYPINES THERAPEUTICS: Cancels Shareholders' Meeting TOWER AUTOMOTIVE: PCT Reaches Deal with SPS to Reduce Claims TOWER AUTOMOTIVE: Post Consummation Trust Disbursed $467,000 in Q1 TOWER AUTOMOTIVE: TAI Mediation with Acemco Fail to Reach Deal TRIBUNE CO: Proposes Management Incentive Plan TRIBUNE CO: Wants Plan Filing Deadline Moved to November 30 TRIBUNE CO: Alvarez & Marsal Bills $3MM for March-May Work TRIBUNE CO: Expands Scope of PwC Work as Tax Advisors TRIBUNE CO: Nielsen Media Withdraws $3.4-mil. Claims TRUMP ENTERTAINMENT: To Be Bought for $100MM by Donald Trump, BNAC TVI CORP: U.S. Trustee Refuses to Appoint Equity Committee TXCO RESOURCES: Nasdaq Disqualifies and Delists Common Stock VALMONT INDUSTRIES: S&P Raises Corporate Credit Rating From 'BB+' VISTEON CORP: Nissan Trading Wants Payment of $630,000 Claim VISTEON CORP: Panasonic Withdraws Adequate Assurance Request VISTEON CORP: Retirees Oppose Termination of Benefit Plans ZILA INC: Misses Quarterly Interest Payment Due July 31 ZILA INC: Tolmar Amends Merger Deal, Raises Per Share Offer * Less DIP Financings Available as Corporate Defaults Increase * Credit-Card Defaults Rose in June on Unemployment, Fitch Says * Scott Pinsonnault Joins Bridge Associates' Turnaround Practice * Large Companies With Insolvent Balance Sheets ********* A & M FLORIDA: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: A & M Florida Properties, LLC GFI Management Services Inc. 50 Broadway - 4th Floor New York, NY 10004 Bankruptcy Case No.: 09-14797 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Kevin J. Nash, Esq. Goldberg Weprin Finkel Goldstein LLP 1501 Broadway, 22nd Floor New York, NY 10036 Tel: (212) 301-6944 Fax: (212) 422-6836 Email: KJNash@Finkgold.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Frederick Mehlman, chief executive officer - GFI of the Company. ABELAR COELHO: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Abelar Coelho 4 Brookfield Road Winthrop, MA 02152 Bankruptcy Case No.: 09-17409 Chapter 11 Petition Date: August 2, 2009 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Frank J. Bailey Debtor's Counsel: Michael Van Dam, Esq. Van Dam & Traini, LLP 60 William Street, Suite 300 Wellesley, MA 02481 Tel: (617) 969-2900 Fax: (617) 964-4631 Email: mvandam@trainilaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Mr. Coelho. ADAM VOLZ: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Adam R. Volz W6333 Highway 77 Minong, WI 54859 Bankruptcy Case No.: 09-15129 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Western District of Wisconsin http://www.wiw.uscourts.gov(Eau Claire) Judge: Thomas S. Utschig Debtor's Counsel: Mart W. Swenson, Esq. Laman & Swenson Law Offices 118 E. Grand Avenue P.O. Box 185 Eau Claire, WI 54702 Tel: (715) 835-7779 Fax: (715) 835-2573 Email: marts@lamanswensonlaw.com Total Assets: $686,425 Total Debts: $1,013,605 A full-text copy of Mr. Volz's petition, including a list of his 3 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/wiwb09-15129.pdf The petition was signed by Mr. Volz. ADVENTRX PHARMACEUTICALS: NYSE Accepts Listing Compliance Plan -------------------------------------------------------------- ADVENTRX Pharmaceuticals, Inc., was notified by staff of the NYSE Amex that its compliance plan has been accepted. On June 1, 2009, ADVENTRX was notified by the NYSE Amex staff that it was not in compliance with the NYSE Amex's continued listing standards as set forth in Part 10 of the NYSE Amex's Company Guide. In order to maintain its listing, the NYSE Amex required ADVENTRX to submit a plan by July 1, 2009, addressing how it intends to regain compliance by December 1, 2010, which the Company submitted timely. On July 31, 2009, the NYSE Amex staff notified ADVENTRX that it has determined that the Plan makes a reasonable demonstration of ADVENTRX's ability to regain compliance with the NYSE Amex's continued listing standards and has determined to grant an extension until December 1, 2010, for ADVENTRX to regain compliance with the NYSE Amex's continued listing standards. During the Extension Period, ADVENTRX will be subject to periodic review to determine whether it is making progress consistent with the Plan. If ADVENTRX does not show progress consistent with the Plan, the NYSE Amex staff will review the circumstances and may immediately commence delisting proceedings. On June 1, 2009, the NYSE Amex staff indicated that the Company is not in compliance with Section 1003(a)(ii) of the NYSE Amex Company Guide with stockholders' equity of less than $4,000,000 and losses from continuing operations and net losses in three of its four most recent fiscal years and Section 1003(a)(iii) of the NYSE Amex Company Guide with stockholders' equity of less than $6,000,000 and losses from continuing operations and net losses in its five most recent fiscal years. About ADVENTRX Pharmaceuticals ADVENTRX Pharmaceuticals, Inc. (NYSE Amex: ANX) -- http://www.adventrx.com/-- is a biopharmaceutical company whose product candidates are designed to improve the safety of existing cancer treatments. AFFILIATED FOODS: Bankruptcy Wipes Out $34MM in Investments ----------------------------------------------------------- The bankruptcy filing by Affiliated Foods Southwest Inc. Affiliated Foods Southwest Inc. has wiped out about $34 million in investments held by more than 600 employees or members of the cooperative, The Associated Press reported. According to the report, investors from Arkansas, Alabama, Georgia, Illinois, Louisiana, Mississippi, Missouri, New Mexico, Oklahoma, Tennessee and Texas bought certificates of indebtedness from the Company. The COIs are part of the unsecured debt held by Affiliated, according to The AP. Under the absolute priority rule of the Bankruptcy Code, secured creditors will be paid to the extent of the value of their collateral are paid first before unsecured creditors are paid. Stockholders would only obtain returns after unsecured creditors are paid. Affiliated Foods was a wholesale cooperative owned by member grocery stores. It supplied hundreds of grocery stores in Arkansas, Texas, Louisiana, Mississippi, Oklahoma and Tennessee. Little Rock, Arkansas-based Affiliated Foods Southwest, Inc., and its affiliates filed for Chapter 11 on May 5, 2009 (Bankr. E.D. Ark. Case No. 09-13178). W. Michael Reif, Esq., at Dover Dixon Horne represents the Debtors in their restructuring efforts. The Debtors listed assets between $10 million to $50 million and debts between $100 million to $500 million. Affiliated Foods has requested that its case be converted to Chapter 7 liquidation, noting that it has sold its inventory and that it has lost access to cash collateral. AFFIRMATIVE EQUITIES: Will Auction Off Patrick Henry Hotel ---------------------------------------------------------- Jenny Kincaid Boone at The Roanoke Times reports that Affirmative Equities Company, L.P.'s Patrick Henry Hotel and its land on Jefferson Street and Bullitt Avenue, assessed at $3.7 million, will be auctioned on Wednesday at 9:30 a.m. The Roanoke Times says that Patrick Henry Hotel has been closed and is in foreclosure. Court documents say that Affirmative Equities lacks a reliable source of income to pay necessary expenses for the Patrick Henry, including payroll, taxes, and insurance. The Roanoke Times relates that the lender, Potomac Realty Capital of Delaware, is moving forward with a foreclosure sale for the hotel. No sale price has been set. The Roanoke Times relates that Bill Mason, a Roanoke attorney and substitute trustee for the Patrick Henry sale, has received inquiries from some interested buyers for the property. According to The Roanoke Times, a deposit of $275,000 or 10% of the price, whichever amount is lower, is due at the time of the Patrick Henry sale. The report says that the buyer must close on the property 30 days later. New York-based Affirmative Equities Company, L.P. is a real estate investment management company. The Company, together with affiliates, filed for Chapter 11 bankruptcy protection on December 2, 2008 (Bankr. S.D.N.Y. Case No. 08-14814). Joseph Corneau, Esq., at Klestadt & Winters, LLP, assists the Debtors in their restructuring efforts. In its petition, Affirmative Equities listed $1 million to $100 million in assets and $1 million to $100 million in debts. Affirmative Equities' Chapter 11 bankruptcy case was converted to Chapter 7 liquidation in February 2009 when it failed to reorganize and restructure its debts. AGFC CAPITAL: Moody's Cuts Preferred Stock Rating to 'Ba3' ---------------------------------------------------------- Moody's Investors Service downgraded American General Finance Corporation's long-term rating to Baa3 from Baa2 and its short- term rating to Prime-3 from Prime-2. The short-term ratings of AGFC subsidiary CommoLoCo, Inc., and direct parent American General Finance Inc. were also downgraded to Prime-3 from Prime-2. The ratings of each entity were also placed under review for further possible downgrade. Moody's said its downgrade of AGFC's ratings reflects its concerns regarding the firm's funding profile, ultimate ownership, operating pressures, and franchise value. Historically, AGFC funded its operations primarily with public unsecured debt, but in recent quarters it has supplemented this source with bank loans, asset sales and securitizations due to constraints in the unsecured debt markets. AGFC and its parent AGFI must repay $4.5 billion of bank debt in July 2010, which will require that AGFC generate substantial additional alternative liquidity. Moody's believes that AGFC could sell or securitize additional assets, given its substantial base of unencumbered loans, but that sales could require higher discounts, resulting in losses. Even considering further liquidity actions, Moody's believes AGFC is likely to require support from AIG to maintain a minimal liquidity cushion. "We have said previously that absent AIG support, AGFC's rating would be non-investment grade," said Moody's senior analyst Mark Wasden. "In Moody's view, inherent weakness in the funding model, combined with continued pressure on asset quality and the risk of franchise value deterioration, suggests that AGFC's stand-alone credit profile may have weakened further," he added. In Moody's view, AGFC's liquidity and capital profiles have benefited from its ownership by and support from AIG. Though AIG is not presently seeking a buyer for the company, Moody's believes that it will likely do so in the future, resulting in uncertainty regarding AGFC's ownership and long-term operating and funding strategies. In the near-term, Moody's expects that AIG will continue to be supportive of AGFC to preserve its opportunity to sell the firm when market conditions improve. Moody's views longer-term support as potentially less certain, particularly if AGFC's performance prospects deteriorate beyond current expectations. During its review, Moody's will consider AGFC's operating prospects during the current challenging operating environment, the effects on its capital and franchise value, and its prospects for returning to profitability while also establishing more resilient sources of funding. Moody's will also consider the strength of support expectations from AIG while it continues to own AGFC. Ratings affected by the action include: American General Finance Corporation: * Long-term Issuer: to Baa3 from Baa2 * Senior Unsecured: to Baa3 from Baa2 * Short-term: to Prime-3 from Prime-2 AGFC Capital Trust I: * Preferred Stock: to Ba3 from Ba2 * American General Finance Inc.: * Short-term: to Prime-3 from Prime-2 CommoLoCo, Inc.: * Short-term: to Prime-3 from Prime-2 In its last rating action on March 17, 2009, Moody's lowered AGFC's long-term rating to Baa2 from Baa1 and assigned a negative rating outlook. American General Finance Corporation, headquartered in Evansville, Indiana, is a financial service holding company with subsidiaries that provide retail consumer finance and credit insurance products to consumers through a network of branches spread throughout 40 states. AIRPORT CHURCH: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Airport Church of Christ dba The Dixie Church of Christ 8000 E. Port Road Little Rock, AR 72206 Bankruptcy Case No.: 09-15502 Chapter 11 Petition Date: August 1, 2009 Court: United States Bankruptcy Court Eastern District of Arkansas (Little Rock) Judge: Richard D. Taylor Debtor's Counsel: Simmons S. Smith, Esq. Attorney at Law 2420 S. Broadway St. Little Rock, AR 72206-2138 Tel: (501) 375-3993 Email: sslawoffice@comcast.net Total Assets: $2,234,360 Total Debts: $2,351,737 A full-text copy of the Debtor's petition, including a list of its 5 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/areb09-15502.pdf The petition was signed by Ronald Parker Sr., treasurer of the Company. ALLIS-CHALMERS ENERGY: Swings to $90,000 Net Loss for Q2 2009 ------------------------------------------------------------- Allis-Chalmers Energy Inc. reported a net loss for the second quarter of 2009 of $90,000, or $0.00 per diluted share, compared to net income of $10.6 million, or $0.30 per diluted share in the second quarter of 2008. Revenues for the second quarter of 2009 decreased 31.0% to $112.5 million compared to $163.1 million for the second quarter of 2008. Results in the second quarter of 2009 include a pre-tax gain of $26.4 million on debt extinguishment associated with the repurchase of $74.8 million of senior notes and non-routine and restructuring charges totaling $8.6 million. The charges include a $3.2 million addition to the allowance for bad debts, $1.6 million in restructuring charges consisting of severance payments and the closing of certain yard locations, a $2.6 million non-cash loss on an asset disposition and inventory writedowns and $1.2 million of customer credits. Allis-Chalmers reported a net loss for the first six months of 2009 of $2.7 million, or $0.08 per diluted share, compared to net income of $18.6 million, or $0.53 per diluted share for the first six months of 2008. Results for the first six months of 2009 include a pre-tax gain of $26.4 million from the extinguishment of debt and non-routine and restructuring charges totaling $10.6 million. The charges include a $3.6 million addition to the allowance for bad debts, $1.8 million in restructuring charges consisting of severance payments and the closing of certain yard locations, a $3.2 million non-cash loss on asset dispositions and inventory writedowns and $2.0 million of customer credits. Adjusted EBITDA was $35.0 million for the second quarter of 2009, compared to $46.2 million for the second quarter of 2008. Adjusted EBITDA for the second quarter of 2009 would have been $17.2 million excluding the $26.4 million gain and the $8.6 million in non-routine and restructuring charges. For the first six months of 2009 Adjusted EBITDA was $64.5 million compared to $88.0 million for the first six months of 2008. Adjusted EBITDA would have been $48.7 million in the first six months of 2009 excluding the $26.4 million gain and the $10.6 million in non-routine and restructuring charges. EBITDA and Adjusted EBITDA are non-GAAP financial measures that are not necessarily comparable from one company to another and additional information and discussion regarding EBITDA and Adjusted EBITDA are provided later in this release. As of June 30, 2009, the Company had $1,103,521,000 in total assets, and $600,160,000 in total liabilities. In June 2009, Allis-Chalmers strengthened its balance sheet and improved its liquidity by raising approximately $125.6 million in gross equity proceeds through a back-stopped common stock rights offering and a new convertible perpetual preferred stock issue. Allis-Chalmers reduced outstanding debt by roughly $113.0 million at the end of the second quarter of 2009, including a $74.8 million reduction of its outstanding senior notes and all outstanding borrowings under the $90.0 million revolver, and increased cash on hand by roughly $40.0 million. Net debt, after cash on hand, was reduced to $439.4 million at the end of the second quarter of 2009 from $584.1 million at the end of the first quarter of 2009. Allis-Chalmers estimates that interest expense will decrease by roughly $8.6 million annually. Micki Hidayatallah, Allis-Chalmers' Chairman and Chief Executive Officer, stated, "The worldwide economic downturn, the decrease in natural gas prices in the U.S., and the impact of the credit and liquidity squeeze on our customers resulted in the U.S. rig count dropping by 52% as of June 30, 2009 compared to June 30, 2008. The weak market environment has had a significant impact on our domestic operations resulting in a severe deterioration in both equipment utilization and pricing." Mr. Hidayatallah also stated, "With operations in Argentina, Brazil and Bolivia, our Drilling and Completion segment has shown more stability and better visibility than the U.S. market, but rig utilization is down 12% to 15% and pricing has deteriorated by 5% to 10%. In this environment it has been difficult to recover increases in wages, fuel, labor and other costs resulting from very high inflationary trends in Argentina. The weakening of the Argentine peso has also impacted revenues. Finally, while our Brazilian operations have performed above expectations, we suffered the total loss of a rig from a blow-out. The rig was insured, but the insurance proceeds will be $1.9 million less than the book value of the rig." To counter market conditions, Allis-Chalmers has taken these steps: -- Decreased domestic work force by 50% to roughly 600 as compared to 1,200 on December 31, 2008. -- Converted much of the fixed direct labor costs to a job day-rate bonus. -- Closed unprofitable operating locations and reduced administrative and supervisory personnel in remote locations. Certain administrative and accounting functions were centralized and consolidated in Houston to increase efficiencies and reduce costs. -- Established a new account management system for its sales force which emphasizes both accountability and financial incentives. Allis-Chalmers will reward salesmen who expand and diversify its customer base and plans to increase market share with incentives for customers that use fully integrated services. -- Established a strategy to redeploy assets to locations with the highest utilization rates at a reasonable price. Domestic markets in which Allis-Chalmers is concentrating include the Marcellus, Haynesville and Eagle Ford shales. Internationally, marketing efforts for the redeployment of assets emphasize Columbia, Mexico, Brazil, the Middle East and the North African region. -- Conserve cash and maximize liquidity. Capital expenditures have been limited to maintenance and to those firm commitments for equipment made in 2008. Inventory levels are being reduced, credit analysis and receivables collection efforts have been intensified and where appropriate payables payment terms have been extended. Mr. Hidayatallah concluded, "In the first half of the year in an extremely difficult environment we internally generated $43 million of operating cash flow after interest, reduced our domestic workforce by over 50% and strengthened our balance sheet. At the end of the quarter, we had cash on hand of roughly $59 million. In the second half of 2009, we intend to enhance revenues with the redeployment of assets and the implementation of our new sales account management system. In 2010 we will endeavor to increase international revenues from 57% of total revenues to roughly 70% of total revenues as a strategic objective. We believe that this strategy will increase gross margins and operating profit and should enable us to be profitable on a net income basis in 2010." About Allis-Chalmers Houston, Texas-based Allis-Chalmers Energy Inc. (NYSE: ALY) -- http://www.alchenergy.com/-- is a multi-faceted oilfield services company. Allis-Chalmers provides services and equipment to oil and natural gas exploration and production companies, domestically primarily in Texas, Louisiana, New Mexico, Oklahoma, Arkansas, offshore in the Gulf of Mexico, and internationally, primarily in Argentina, Brazil and Mexico. Allis-Chalmers provides directional drilling services, casing and tubing services, underbalanced drilling, production and workover services with coiled tubing units, rental of drill pipe and blow-out prevention equipment, and international drilling and workover services. * * * As reported by the Troubled Company Reporter on July 15, 2009, Standard & Poor's Ratings Services raised its corporate credit rating on Allis-Chalmers Energy to 'B-' from 'SD' (selective default). The outlook is negative. At the same time, S&P raised the issue-level rating on Allis-Chalmers' unsecured notes to 'B-' (the same as the corporate credit rating) from 'D'. S&P revised the recovery rating on this debt to '4' from '3' indicating expectations of average (30%-50%) recovery of principal in the event of a payment default. The TCR said July 9, 2009, Moody's Investors Service affirmed Allis-Chalmers' B3 Corporate Family Rating, changed its Probability of Default Rating to B3 from B3/LD, and upgraded its $225 million 9% senior notes due 2014 to Caa1 (LGD 4, 62%) from Caa3 (LGD 3, 35%) and its $205 million 8.5% senior notes due 2017 to Caa1 (LGD 4, 62%) from Ca (LGD 4, 40%). The rating outlook is stable. AMBAC ASSURANCE: S&P Corrects Sevier Airport Revenue Bond Ratings ----------------------------------------------------------------- Standard & Poor's Ratings Services has corrected and raised its long-term rating on Sevier County Public Building Authority, Tennessee's general airport revenue bonds, issued for Metropolitan Knoxville Airport Authority, to 'A-' from NR. The outlook is stable. A bond insurance policy from Ambac Assurance Corp. (CC/Developing/--) also guarantees these bonds. On July 25, 2008, S&P assigned its 'A-' underlying rating on the authority's bonds but incorrectly did not change the long-term public rating. According to S&P's criteria, the rating on a fully credit-enhanced bond is the higher of the rating on the credit enhancer and the SPUR. In this case, the rating on the airport is higher than that on the bond insurance provider. About Ambac Assurance Ambac Financial Group, Inc. is a primarily a holding company. The Company, through its subsidiaries, provides financial guarantees and financial services to clients in both the public and private sectors worldwide. Ambac's activities are divided into two business segments. The Financial Guarantee segment provides financial guarantees (including credit derivatives) for public finance, structured finance and other obligations. The Financial Services segment provided investment agreements, funding conduits, interest rate, total return and currency swaps, principally to clients of the financial guarantee business. During the year ended December 31, 2008, the Company discontinued writing new investment agreements and derivative products in its Financial Services segment. Its existing investment agreement and derivative product portfolios are in active runoff, which may include transaction terminations, settlements, restructuring, transfers and natural attrition as contracts mature. Moody's Investors Service at the end of July 2009 downgraded to Caa2 from Ba3 the insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited. The rating action was prompted by Ambac's announced large loss reserve increase and credit impairment charge estimated for 2Q 2009. Standard & Poor's Ratings Services said that it lowered its counterparty credit, financial strength, and financial enhancement ratings on Ambac Assurance Corp. to 'CC' from 'BBB' and removed them from CreditWatch, where they were placed on June 24, 2009, with negative implications. "This rating action reflects S&P's view of the significant deterioration in Ambac's insured portfolio of nonprime residential mortgage-backed securities and related CDOs," noted Standard & Poor's credit analyst David Veno. AMERICAN INT'L: Board Names Robert Benmosche President & CEO ------------------------------------------------------------ American International Group, Inc.'s Board of Directors has elected Robert H. Benmosche President and Chief Executive Officer. Mr. Benmosche was also elected a member of the Board of Directors, and will assume his new roles on August 10, 2009, with the retirement of Chairman and Chief Executive Officer Edward M. Liddy. "AIG and American taxpayers are fortunate to gain the commitment of Bob Benmosche, a highly experienced executive who understands the challenges and opportunities of restructuring complex organizations," Mr. Liddy said. "Our stakeholders can look forward to a seamless transition and rest assured that the work of rebuilding the value of AIG's businesses and repaying the government will continue uninterrupted." Dennis Dammerman, Chairman of the AIG Board of Directors' Search Committee, said that Mr. Benmosche's experience is an ideal match for AIG. "Bob's outstanding track record as head of a major insurer and his success in business integration and execution of major transactions make him well-suited to lead AIG in the next phase of its restructuring. We are confident he will continue the substantial progress the company has achieved under the leadership of Ed Liddy. Ed answered the call for public service amid an extraordinary financial crisis that has only now begun to ease, and our company and country owe him a debt of gratitude." "Ed and his team have done a terrific job stabilizing AIG and implementing a strategy to repay the Company's stakeholders, including taxpayers," Mr. Benmosche said. "Now he has passed the baton to me, and I look forward to continuing the race. With my AIG colleagues, we will focus on this mission: maximizing the value of the company's assets and meeting all of our stakeholder obligations." In addition, the Company announced that Paula Rosput Reynolds, Vice Chairman and Chief Restructuring Officer, has decided to leave the company effective late in the third quarter of 2009. "Paula has played an instrumental role in our progress, having divested operations around the world and implemented a durable, long-term restructuring plan that has stabilized the Company and provided time for asset values to recover " Mr. Liddy said. "I could not have asked for a better partner, and we all wish her well in her future endeavors." Mr. Benmosche, 65, is former Chairman, President, and Chief Executive Officer of MetLife, a leading provider of insurance and other financial services. Mr. Benmosche led the transition of MetLife from a mutual to a public company in 2000. He joined MetLife in 1995 as Executive Vice President responsible for business integration and product development, marketing and sales efforts focused on MetLife's individual customers. Earlier in his career he served as Executive Vice President for PaineWebber, Inc., where he directed the merger of Kidder Peabody into PaineWebber. He also served in various capacities with Chase Manhattan Bank from 1976 to 1982. Mr. Benmosche has served as a member of the Board of Directors of Credit Suisse Group since 2002. Mr. Benmosche served as a Lieutenant in the United States Army from 1966 to 1968. He received a B.A. degree in Mathematics from Alfred University in 1966. Based in New York, American International Group, Inc., is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. On September 16, 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received, and continues to seek buyers of its assets. At March 31, 2009, AIG had $819.75 billion in total assets and $765.53 billion in total liabilities. At September 30, 2008, AIG had $1.022 trillion in total assets and $950.9 billion in total debts. The Troubled Company Reporter reported on March 4, 2009, that Moody's Investors Service confirmed the A3 senior unsecured debt and Prime-1 short-term debt ratings of American International Group. AIG's subordinated debt rating has been downgraded to Ba2 from Baa1. The rating outlook for AIG is negative. This rating action follows AIG's announcement of net losses of $62 billion for the fourth quarter and $99 billion for the full year of 2008, along with a revised restructuring plan supported by the U.S. Treasury and the Federal Reserve. This concludes a review for possible downgrade that was initiated on September 15, 2008. AMERICAN LOCKER: Inks Receivables Purchase Deal with Gulf Coast --------------------------------------------------------------- American Locker Group Incorporated on July 29, 2009, entered into a receivables purchase agreement with Gulf Coast Bank and Trust Company, pursuant to which the Company will sell certain of its accounts receivable to GCBT. GCBT will not purchase receivables from the Company if the total of all outstanding receivables held by it, at any time, exceeds $2,500,000. In addition, if a receivable is determined to be uncollectible or otherwise ineligible, GCBT may require the Company to repurchase the receivable. The Agreement calls for the Company to pay a daily variable discount rate, which is the greater of prime plus 1.50%; or 6.5% per annum, computed on the amount of outstanding receivables held by GCBT, for the period during which such receivables are outstanding. The Company will also pay a fixed discount percentage of 0.2% for each ten-day period during which receivables held by GCBT are outstanding. Proceeds from the sales of receivables under the Agreement will be used to repay the Company's existing $750,000 revolving line of credit with the F&M Bank & Trust Co. and for general working capital purposes. The Company has granted to GCBT a security interest in certain assets to secure its obligations under the Agreement. The Agreement is terminable at any time by either the Company or GCBT upon the giving of notice. The Company also disclosed that its First Amended and Restated Loan Agreement Dated March 5, 2008, with F&M Bank and Trust Company and Altreco, Inc., as Guarantor (Line of Credit), has been retired and terminated. On March 30, 2009, American Locker entered into an agreement with the F&M Bank & Trust to extend the maturity date of its $750,000 revolving line of credit until June 5. The agreement increased the interest rate from 0.75% above the prime rate to 2% above the prime rate. The floor interest rate was also increased from 5% to 6% per annum. On March 19, American Locker obtained a new $2 million mortgage loan from F.F.F.C., Inc. which was used to repay the existing mortgage loan with the F&M Bank & Trust. Interest on the loan is 12% per annum and is payable monthly. The loan matures March 20, 2011. The Company has yet to file its quarterly report on Form 10-Q for the three months ended March 31, 2009; and its annual report on Form 10-K for the year ended December 31, 2008. According to the Company, due to the current credit crisis, it postponed the audit of its financial statements for the fiscal year ended December 31, 2008, until it could complete a restructuring of its current credit facility. About American Locker American Locker Group Incorporated (Pink Sheets: ALGI) -- http://www.americanlocker.com, http://www.canadianlocker.comand http://www.securitymanufacturing.com-- which is based in Grapevine, Texas, supplies secure storage lockers under the American Locker Security Systems and Canadian Locker brands. American Locker's systems range from coin-operated lockers to RFID and electronic-controlled distribution systems to employee and personal lockers. American Locker is known for its iconic orange keys and is viewed as the industry standard for secure storage. Its Security Manufacturing Corporation subsidiary is a leading provider of commercial mailboxes through a national distribution network. Security Manufacturing offers a complete line of U.S. Postal Service approved mailboxes including horizontal and vertical apartment mailboxes, plus private mail delivery solutions for private industry and colleges and universities. AMR CORP: Unit Closes $276 Million Private Debt Sale ---------------------------------------------------- AMR Corporation (NYSE: AMR), the parent company of American Airlines, Inc., said August 3 that American Airlines has closed a $276 million private placement offering of senior secured notes due 2016, which were priced at par to yield 13 percent. The purpose of the offering was to refinance, in part, the outstanding $401 million principal amount of the Company's 1999-1 enhanced equipment trust certificates (1999 EETCs), which are scheduled to be paid in full on October 15, 2009. The Company deposited the net proceeds from the offering as cash collateral to secure the new notes. Following the October 15 maturity of the 1999 EETCs, the new notes will be secured by 12 of the 15 aircraft that currently secure the 1999 EETCs, and the cash collateral will be released to the Company. Once secured by the 12 aircraft, the new notes will have an initial loan-to-appraised value ratio of 65 percent. The secured notes were offered and sold in the United States in transactions exempt from registration under the Securities Act of 1933, as amended, and outside the United States pursuant to Regulation S under the Securities Act. The notes were not registered under the Securities Act or applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state law. About AMR Corporation Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, including Brazil, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. AMR Corp. reported a net loss of $390 million for the second quarter of 2009, or $1.39 per share. At June 30, 2009, the Company had $24.1 billion in total assets; $8.2 billion in total current liabilities, $8.3 billion in long- term debt, less current maturities, $572 million in obligations under capital leases, less current obligations, $6.8 billion in pension and postretirement benefits, and $3.1 billion in other liabilities, deferred gains and deferred credits; resulting in a $3.0 billion stockholders' deficit. Following the release of AMR's second quarter results, Standard & Poor's Ratings Services placed its ratings, including the 'B-' corporate credit ratings, on AMR Corp. and its American Airlines Inc. subsidiary, on CreditWatch with negative implications, due to concerns about revenue generation and liquidity. Fitch Ratings has affirmed issuer default rating of AMR Corp. and its principal operating subsidiary American Airlines, Inc. at 'CCC'. AMR CORP: Fitch Affirms Issuer Default Rating at 'CCC' ------------------------------------------------------ Fitch Ratings has affirmed the debt ratings of AMR Corp. and its principal operating subsidiary American Airlines, Inc.: AMR -- Issuer Default Rating (IDR) at 'CCC'; -- Senior Unsecured Debt at 'C'/RR6'. American Airlines -- IDR at 'CCC'; -- Secured Bank Credit Facility at 'B+'/RR1. There is no Rating Outlook for AMR and American. Fitch generally does not maintain a Rating Outlook for corporate issuers with IDRs of 'CCC' or below. The affirmation follows Fitch's March 13 downgrade of ratings for both entities, which reflected growing concerns about the cash flow and liquidity implications of the collapse in business travel demand that has undermined passenger revenue for the entire U.S. airline industry during the first half of 2009. AMR's second quarter revenue performance was generally consistent with results reported by all of the U.S. network carriers as sharp declines in passenger yields pushed mainline revenue per available seat mile down by 16% in the quarter. While AMR has successfully tapped the credit markets over the past several weeks to address significant aircraft financing needs, Fitch remains concerned about the carrier's near-term liquidity outlook in light of the extreme revenue pressure being felt across the industry during the global recession. With the seasonally-weak demand period approaching, Fitch remains focused on the degree to which AMR can counter negative free cash flow trends in the third and fourth quarters with successful capital raising efforts to keep unrestricted liquidity near the current level of $2.8 billion. As noted in the March downgrade, intense pressure on premium travel demand and extensive fare discounting, especially in hard- hit international markets, continues to drive passenger revenues lower, offsetting much of the benefit of substantially lower jet fuel prices in 2009. Looking ahead to the fall and winter, management remains cautious about the potential for recovery in business demand and fares, even as preliminary indications of a U.S. economic recovery have begun to appear. Fitch believes that a full-year 2009 RASM decline in excess of 10% is now more likely for AMR and the rest of the U.S. global network carriers, raising the risk that AMR will report another year of substantially negative free cash flow at a time when fixed cash obligations (scheduled debt maturities and required pension contributions) are heavy. A bottoming-out process does appear to be occurring with respect to RASM trends in June and July, but AMR and its competitors have continued to take additional capacity out of their fall schedules in anticipation of weak demand and yields after late August. Even if AMR is successful in refinancing a large portion of upcoming debt maturities through new aircraft-backed borrowing as assets become unencumbered, the airline faces a longer term challenge in meeting heavy fixed cash obligations (both debt payments and ultimately cash pension funding requirements) in the 2010-2011 period. In addition to $800 million in debt principal payments due in the second half of 2009, AMR faces scheduled debt maturities of approximately $1.3 billion in 2010 and $2.2 billion in 2011. Furthermore, pension funding requirements beyond 2009 could ramp up dramatically if another year of poor plan asset returns widens AMR's underfunded pension liability ($4.2 billion on a projected benefit obligation basis as of December 31, 2008). In the aftermath of the 2008 market collapse, the carrier's funded position slipped from approximately 96% of the PBO as of year-end 2007 to 70% at the end of 2008. Importantly, AMR retains unencumbered assets (including aircraft, engines, the American Eagle regional airline subsidiary, route authorities and potential proceeds from a sale of frequent flyer miles) that the carrier values at $3.7 billion. In addition, AMR estimates that a further $500 million in assets will become unencumbered this year as secured debt is paid down. Given the current state of the capital markets, however, there is no assurance that financing or sale of these assets will raise the amount of capital required to meet future cash obligations while maintaining unrestricted liquidity above critical levels. The airline's recent success in closing a pass-through certificates financing, in addition to subsequent secured borrowings in July, augurs well for AMR in reducing refinancing risk in 2010 as credit markets stabilize. The airline's operating results remain highly sensitive to jet fuel prices, which in the second quarter averaged more than 40% below the year-earlier level even after the run-up in fuel prices late in the quarter. As out-of-the-money fuel derivative positions have rolled off in the first half of the year, AMR is less exposed to swings in cash flow related to the posting of fuel hedge collateral. For the second half of the year, the airline expects jet fuel prices paid to exceed spot prices by approximately 15 cents per gallon. Management expects full-year jet fuel prices to average $1.98 per gallon. Still, the margin of safety with respect to changes in energy prices is thin as a result of the deterioration of the revenue environment. Some of the benefits of lower fuel prices are being offset this year by rising unit operating costs in areas such as employee benefits (higher pension accruals), airport costs and aircraft rents. AMR has forecasted non-fuel mainline unit operating expenses to be up approximately 6.5% for full-year 2009. Pressure on non-fuel unit costs will persist as the carrier takes additional capacity (mostly in international markets) out of the schedule in the second half of the year. With regard to aircraft commitments, all of AMR's scheduled Boeing 737-800 aircraft deliveries through 2011 have committed financing in place. AMR is committed to take 31 B737-800 deliveries this year, 45 in 2010 and eight in 2011. Taking into account committed aircraft financing, cash capital spending will be limited to approximately $500 million in 2009. The addition of new aircraft debt, alongside any new refinancing of upcoming maturities, will delay any progress toward total debt reduction during a period of continuing stress in the operating environment. Additional increases in AMR's lease-adjusted leverage will, in Fitch's view, further erode the sustainability of its highly leveraged capital structure as fixed financing obligations grow relative to the carrier's long-term cash flow generation potential. AMR's $255 million revolving credit facility was paid down in June upon its expiration. The airline retains a $433 million secured bank term loan maturing in December 2010. In June, AMR negotiated a credit facility amendment that modified the required EBITDAR fixed-charge coverage levels for upcoming quarters. The ratio of EBITDAR to fixed charges (adjusted for certain items) must exceed 0.95 for the one-, two- and three-quarter periods ending September 30, 2009, December 31, 2009, and March 31, 2010. The ratio steps up in subsequent quarters. The EBITDAR covenant is the most restrictive covenant in the credit facility. In addition, AMR has received covenant relief from its major credit card processor to cap credit card cash hold-backs tied to financial covenants in the processing agreement. A further downgrade of IDRs for AMR and American to 'CC' or below could follow if demand pressure intensifies further through the third and fourth quarters, eroding RASM further and increasing the risk of a liquidity crisis in early 2010. A worsening of conditions in the credit markets would also be a source of concern, given AMR's debt maturity profile. Any significant spike in jet fuel prices, while unlikely in light of the current global energy demand outlook, could also lead to a downgrade. AROMAS-SAN JUAN: Fitch Affirms 'BB+' Rat6ing on $11.5 Mil. Bonds ---------------------------------------------------------------- In the course of routine surveillance, Fitch Ratings affirms Aromas-San Juan Unified School District, California's (the district) $11.5 million outstanding general obligation bonds at 'BB+'. The Rating Outlook is Stable. The 'BB+' rating reflects the district's extremely weak financial position and slowing tax base following rapid development, balanced by management's efforts to regain financial stability and low debt levels. The rating also considers high tax base concentration, and weakening local economic and real estate market conditions. While Fitch acknowledges the district's progress to date in reducing spending to better align with revenue, financial operations are marked by negative total and unreserved general fund balances resulting from several years of deficit spending and recently flat to declining enrollment, a difficult state funding environment, and the need for external borrowing to support cash flows. Future rating actions will consider the district's ability to produce balanced financial operations and rebuild to adequate reserve levels. Estimated financial results for fiscal 2009 project a roughly $60,000 operating deficit, which is a marked improvement from the approximately $729,000 operating loss during the prior fiscal year. The fiscal 2009 deficit lowered the total and unreserved/undesignated general fund balances to negative $412,300 (-3.7% of expenditures and transfers out) and negative $754,500 (- 6.8%), respectively. Despite prudent actions by management to cut expenditures, the weakening state funding environment largely offset cost savings. Additionally, operations in fiscal 2009 were supported by non-recurring federal stimulus funds. For fiscal 2010, management expects a slight operating surplus due to recent expenditure reductions and a certificate of participation refinancing that pushes debt service out by five years. The district continues to operate under the auspices of a fiscal advisor appointed by the county board of education. The advisor has stay and rescind powers over board actions. The district is located in the San Joaquin Valley of central California, near the central coast and Monterey Bay. It is located 25 miles northeast of Monterey and 38 miles south of San Jose. The district encompasses a 100 square mile area including the city of San Juan Bautista (9.8%) and portions of San Benito (59.5%), Monterey (29.8%), and Santa Cruz (0.9%) counties. The regional economy is experiencing significant pressure. New development is nearly at a standstill, and unemployment rates for San Benito County have increased to 14% in May, from 8.8% in the prior year. Likewise, home foreclosure rates are up substantially from 2008 levels, and both Monterey and San Benito Counties have high exposure to negative amortization mortgages. The city of San Juan Baptista is also facing high exposure to negative amortization mortgages, but its foreclosure rate is materially lower than the county and national rate, which may be an indication of greater local stability. Nonetheless, the weakening economy is likely to negatively impact enrollment and assessed valuation levels, thus pressuring an already concentrated tax base. ARRAYIT CORP: Berman Hopkins Raises Going Concern Doubt ------------------------------------------------------- Berman Hopkins Wright & LaHam, CPAs and Associates, LLP, in Winter Park, Florida, in its audit report dated July 30, 2009, expressed substantial doubt on the ability of Arrayit Corporation, formerly Integrated Media Holdings, Inc., to continue as a going concern. Berman Hopkins said the Company has suffered recurring losses and has working capital and stockholder deficits. On July 31, 2009, Arrayit filed with the Securities and Exchange Commission amendments to its annual report on Form 10-K for the year ended December 31, 2008; and to its quarterly report on Form 10-Q for the three months ended March 31, 2009. Arrayit had $806,745 in total assets and $27,975,989 in total liabilities as of March 31, 2009. Arrayit had a working capital deficit of $27,671,815, and recurring net losses. Arrayit had total assets of $907,133 and total liabilities of $11,755,125 as of December 31, 2008. Arrayit had total negative working capital of $10,760,689 as of December 31, 2008. The Company has said its ability to continue as a going concern is dependent on it generating cash from the sale of its common stock or obtaining debt financing and attaining future profitable operations. Management's plans include selling its equity securities and obtaining debt financing to fund its capital requirement and ongoing operations; however, there can be no assurance Arrayit will be successful in these efforts. A full-text copy of the Amended Quarterly Report is available at no charge at http://ResearchArchives.com/t/s?4098 A full-text copy of the Amended Annual Report is available at no charge at http://ResearchArchives.com/t/s?4099 About Arrayit Corp. Arrayit Corporation develops, manufactures and markets next- generation life science tools and integrated systems for the large scale analysis of genetic variation, biological function and diagnostics. The Company provides a comprehensive line of products and services that currently serve the sequencing, genotyping, gene expression and protein analysis markets, and the Company expects to enter the market for molecular diagnostics. Arrayit was formed on the merger of Integrated Media Holdings, Inc. with TeleChem International, Inc., and its major shareholders, Endavo Media and Communications, Inc., and TCI Acquisition Corp. in February 2008. IMHI Merger IMHI issued 103,143 shares of Series C Convertible Preferred Stock to the TeleChem Shareholders in exchange for 100% of the equity interests of TeleChem resulting in TeleChem being a wholly owned subsidiary. The former TeleChem shareholders now own roughly 73.5% of the outstanding interest and voting rights of IMHI. The Preferred Stock is convertible into 36,100,000 shares of common stock after, but not before, the effective date of the reverse split of the outstanding Integrated Media common stock. IMHI transferred its wholly owned subsidiary, Endavo, to an individual. Effective March 19, 2009, IMHI changed its name to Arrayit Corporation. The Company's common stock began trading on the OTC Bulletin Boards as "ARYC". Malone & Bailey, PC, in Houston, expressed substantial doubt about Integrated Media Holdings' ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended December 31, 2007. The auditing firm pointed to the company's recurring losses, negative working capital, and stockholders' deficit. Integrated Media Holdings' consolidated balance sheet at September 30, 2008, showed $1,246,655 in total assets and $11,948,848 in total liabilities, resulting in a $10,702,193 stockholders' deficit. ARROWHEAD GENERAL: S&P Affirms Junks Rating on 2nd-Lien Sec. Debt ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its 'B-' counterparty credit rating and negative outlook on San Diego, California-based Arrowhead General Insurance Agency Inc. Standard & Poor's also said that it affirmed 'B-' ratings on Arrowhead's first-lien senior secured bank loan and first-lien revolving credit facility as well as its 'CCC' rating on the company's second-lien secured debt. The first-lien recovery rating is '3', indicating S&P's expectation of meaningful (50%- 70%) recovery in the event of a payment default. The second-lien recovery rating is '6', indicating S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. Subsequently, Standard & Poor's withdrew all of these ratings at the request of Arrowhead management. Arrowhead reported a net loss of $2.7 million for the first quarter of 2009. The company's total debt outstanding was $171.8 million as of March 31, 2009. "Arrowhead has a focused insurance brokerage platform," noted Standard & Poor's credit analyst Michael Gross. "However, declining premium rates in the property/casualty industry, some carrier disruption, and the current recessionary economic environment have hurt its results." The company has taken a number of corrective actions in 2009. For example, in April, it amended its bank loan credit agreements after noncompliance at year-end 2008. In addition, in May, it repaid $7.6 million of first-lien bank debt, and in June, the company appointed a chief financial officer and executive vice president from its private equity sponsor, Spectrum Equity Investors, and repaid another $2.4 million of first-lien bank debt. Standard & Poor's expects that Arrowhead's full-year 2009 revenue will be lower than in 2008. S&P believes that Arrowhead will report a moderate net loss for the year. ASARCO LLC: Vedanta Won't Beef Up Offer for Assets -------------------------------------------------- Vedanta Resources Plc's Chief Executive Officer M.S. Mehta said July 31 that the company "has no immediate plans" to raise the bid it made to acquire Asarco, according to the Wall Street Journal. Mr. Mehta said the company's bid "reflects the current market conditions" and the company does not "feel a need" to raise it, the paper said. ASARCO LLC has sent to creditors three competing Chapter 11 plans for voting -- plans sponsored by investors led by Harbinger Capital Partners Master Fund I Ltd., another by parent Grupo Mexico SAB, through ASARCO Inc. and a third by ASARCO LLC. ASARCO LLC's plan is built upon an agreement to sell assets to Vedanta unit Sterlite Industries Inc. Sterlite has agreed to provide a $770 million promissory note, pay $1.1 billion in cash and assume certain liabilities as part of its consideration in exchange for ASARCO's assets. Harbinger and co-sponsor Citigroup Global Markets Inc.'s letter to creditors urge a vote for the Company's plan, and not to vote on parent Grupo Mexico SAB's proposed plan. According to Harbinger, the Debtors' Plan provides for maximum recoveries to, and expeditious and equitable treatment of, all holders of claims, including holders of bond claims. Harbinger and Citigroup, which own two-thirds of Asarco's bonds and debentures, say that the Parent Plan may be non-confirmable as it deprives creditors of the right to collect US$500 million in post-bankruptcy interest. The bondhoders say they proposed their own plan just in case Asarco's plan couldn't be confirmed "for some unforeseeable reason." Copies of the disclosure statement explaining the three plans, as divided into five parts, are available for free at: http://bankrupt.com/misc/ASARCO_Joint_DS_070609_01.pdf http://bankrupt.com/misc/ASARCO_Joint_DS_070609_02.pdf http://bankrupt.com/misc/ASARCO_Joint_DS_070609_03.pdf http://bankrupt.com/misc/ASARCO_Joint_DS_070609_04.pdf http://bankrupt.com/misc/ASARCO_Joint_DS_070609_05.pdf 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. ASARCO LLC filed for Chapter 11 protection on August 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 ASARCO LLC filed for protection from its creditors, it listed US$600 million in total assets and US$1 billion in total debts. ASARCO LLC 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. Sander L. Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, APC, in Dallas, Texas, represents the Official Committee of Unsecured Creditors for the Asbestos Debtors. Former judge Robert C. Pate has been appointed as the future claims representative. 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 October 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 December 12, 2006. (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). Six of ASARCO's affiliates, Wyoming Mining & Milling Co., Alta Mining & Development Co., Tulipan Co., Inc., Blackhawk Mining & Development Co., Ltd., Peru Mining Exploration & Development Co., and Green Hill Cleveland Mining Co. filed for Chapter 11 protection on April 21, 2008. (Bank. S.D. Tex. Case No. 08-20197 to 08-20202). ASARCO LLC filed a plan of reorganization on July 31, 2008, premised on the sale of the Debtors' assets to Sterlite USA for US$2.6 billion. By October 2008, ASARCO LLC informed the Court that Sterlite refused to close the proposed sale and thus, the Original Plan could not be confirmed. The parties has since renewed their purchase and sale agreement and ASARCO LLC has obtained Court approval of a settlement and release contained in the new PSA for the sale of the ASARCO assets for US$1.1 billion in cash and a US$600 million note. Americas Mining Corporation, an affiliate of Grupo Mexico SAB de CV, submitted its own plan which allows it to keep its equity interest in ASARCO LLC by offering full payment to ASARCO's creditors. AMC offered provide up to US$2.7 billion in cash and a US$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. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) BABCOCK QUARTER: Has Until Aug. 7 to File Schedules & Statements ---------------------------------------------------------------- The Hon. Brenda T. Rhoades of the Eastern District of Texas extended until August 7, 2009, Babcock Quarter Horses, Inc.'s time to file its schedules of assets and liabilities and statement of financial affairs. Gainesville, Texas-based Babcock Quarter Horses, Inc., operates a ranch. The Company filed for Chapter 11 on July 13, 2009 (Bank. E. D. Tex. Case No. 09-42232). Bill F. Payne, Esq., represents the Debtor in its restructuring efforts. In its petition, the Debtor listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in debts. BABCOCK QUARTER: Meeting of Creditors Scheduled for August 21 ------------------------------------------------------------- The U.S. Trustee for Region 6 will convene a meeting of creditors in Babcock Quarter Horses, Inc.'s Chapter 11 case on August 21, 2009, at 2:00 p.m. The meeting will be held at Plano Centre, 2000 E. Spring Creek Parkway, in Plano, Texas. 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. Gainesville, Texas-based Babcock Quarter Horses, Inc., operates a ranch. The Company filed for Chapter 11 on July 13, 2009 (Bank. E. D. Tex. Case No. 09-42232). Bill F. Payne, Esq., represents the Debtor in its restructuring efforts. In its petition, the Debtor listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in debts. BALTIMORE MAYOR: S&P Gives Negative Outlook on 2006-B Bonds ----------------------------------------------------------- Standard & Poor's Ratings Services said it revised the outlook on the Baltimore Mayor and City Council, Maryland's $53.44 million convention center hotel revenue series 2006B bonds to negative from stable. At the same time, S&P affirmed its 'BB+' rating on the Council's $247.5 million convention center hotel senior revenue series 2006A bonds and its 'BB' rating on the 2006B bonds. The outlook on the 2006A series bonds remains stable. The council issued the bonds for the Baltimore Hotel Corp. The outlook revision stemmed from the impact of the recession on the hotel project as it completes it first year of operations. Performance in 2009 has weakened significantly compared with the budget. If the project continues to perform at this level, Standard & Poor's believes that the 2010 debt service coverage of senior and all debt by total pledged revenue, including support from the city, will be less than 1.7x and 1.4x, respectively. The hotel's net revenues and city revenues secure the bonds. The city revenues include a $7 million annual guarantee funded through a second lien on the citywide hotel occupancy tax revenue. It also includes a pledge of site-specific hotel occupancy tax revenue, which will vary based on the project's occupancy levels and the tax increment payment, which is equal to the hotel's property tax payment. S&P base the stable outlook on the 2006A series bonds on the hotel's ability to attain its projected financial performance. The hotel has opened during a significant market downturn. S&P could lower the rating on the series 2006B bonds, if the coverage levels for all project debt remains below 1.4x for a period of more than two years as a result of a prolonged economic slowdown, or other competitive factors that reduce net hotel revenues. S&P could revise the outlook to stable if the hotel's operating and financial performance stabilizes and shows improvement, resulting in coverage levels of all debt in excess of 1.7x. BAMBOO ABBOTT: Meeting of Creditors Scheduled for September 17 -------------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of creditors in Bamboo Abbott, Inc.'s Chapter 11 case on Sept. 17, 2009, at 10:00 a.m. The meeting will be held at Clarkson S. Fisher Federal Courthouse, 402 East State Street, Room 129, Trenton, New Jersey. 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. Edison, New Jersey, Bamboo Abbott, Inc., dba Prestige Window Fashions filed for Chapter 11 on July 19, 2009 (Bankr. D. N.J. Case No. 09-28689). Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman & Leonard represents the Debtor in its restructuring efforts. In its petition, the Debtor listed assets and debts both ranging from $10,000,001 to $50,000,000. BANK OF AMERICA: Pays $33MM to Settle SEC Suit on Merrill Bonuses ----------------------------------------------------------------- The Securities and Exchange Commission charged Bank of America Corporation for misleading investors about billions of dollars in bonuses that were being paid to Merrill Lynch & Co. executives at the time of its acquisition of the firm. Bank of America agreed to settle the SEC's charges and pay a penalty of $33 million. The SEC alleges that in proxy materials soliciting the votes of shareholders on the proposed acquisition of Merrill, Bank of America stated that Merrill had agreed that it would not pay year- end performance bonuses or other discretionary compensation to its executives prior to the closing of the merger without Bank of America's consent. In fact, Bank of America had already contractually authorized Merrill to pay up to $5.8 billion in discretionary bonuses to Merrill executives for 2008. According to the SEC's complaint, the disclosures in the proxy statement were rendered materially false and misleading by the existence of the prior undisclosed agreement allowing Merrill to pay billions of dollars in bonuses for 2008. "Companies must give shareholders all material information about corporate transactions they are asked to approve," said Robert Khuzami, Director of the SEC's Division of Enforcement. "Failing to disclose that a struggling company will pay out billions of dollars in performance bonuses obviously violates that duty and warrants the significant financial penalty imposed by today's settlement." David Rosenfeld, Associate Director of the SEC's New York Regional Office, said, "As Merrill was on the brink of bankruptcy and posting record losses, Bank of America agreed to allow Merrill to pay its executives billions of dollars in bonuses. Shareholders were not told about this agreement at the time they voted on the merger." The SEC's complaint, filed in the U.S. District Court for the Southern District of New York, alleges that Bank of America represented in the merger agreement that Merrill had agreed not to pay any bonuses to its executives before the merger closed, except as set forth in a schedule. Unbeknownst to shareholders, the schedule was already in place weeks before the proxy statement was filed with the SEC and disseminated to shareholders. Under the schedule, Bank of America had agreed that Merrill could pay up to $5.8 billion, or nearly 12 percent of the $50 billion merger consideration, in discretionary bonuses to its executives. The merger agreement was included as an appendix and summarized in the joint proxy statement that was distributed to all 283,000 shareholders of both companies. But Bank of America's agreement to allow Merrill to pay these discretionary bonuses was in a separate document that was omitted from the proxy statement and whose contents were never disclosed before the shareholders' vote on the merger. In settling the SEC's charges without admitting or denying the allegations, Bank of America consented to the entry of a judgment that permanently enjoins Bank of America from violating the proxy solicitation rules -- Section 14(a) of the Exchange Act of 1934 and Rule 14a-9 -- and orders Bank of America to pay the financial penalty. The settlement is subject to court approval. The SEC acknowledges the assistance of the U.S. Attorney's Offices for the Southern District of New York and the Western District of North Carolina, the Federal Bureau of Investigations, and the Office of the Special Inspector General for the Troubled Asset Relief Program. The SEC's investigation is ongoing. About Bank of America Based in Charlotte, North Carolina, Bank of America -- http://www.bankofamerica.com/-- is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The Company serves more than 59 million consumer and small business relationships with more than 6,100 retail banking offices, nearly 18,700 ATMs and online banking with nearly 29 million active users. Following the acquisition of Merrill Lynch on January 1, 2009, Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes serving corporations, governments, institutions and individuals around the world. Bank of America offers support to more than 4 million small business owners. The Company serves clients in more than 150 countries. Bank of America Corporation stock is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange. The bank needed the government's financial help in completing its acquisition of Merrill Lynch. Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth management, capital markets and advisory companies with offices in 40 countries and territories. As an investment bank, it is a leading global trader and underwriter of securities and derivatives across a broad range of asset classes and serves as a strategic advisor to corporations, governments, institutions and individuals worldwide. Merrill Lynch owns approximately half of BlackRock, one of the world's largest publicly traded investment management companies with more than $1 trillion in assets under management. Merrill Lynch's operations are organized into two business segments: Global Markets and Investment Banking (GMI) and Global Wealth Management (GWM). As reported by the Troubled Company Reporter on March 27, 2009, Moody's Investors Service lowered the senior debt rating of Bank of America Corporation to A2 from A1, the senior subordinated debt rating to A3 from A2, and the junior subordinated debt rating to Baa3 from A2. The preferred stock rating was downgraded to B3 from Baa1. The holding company's short-term rating was affirmed at Prime-1. BANKUNITED FINANCIAL: Common Stock Delisted by Nasdaq ----------------------------------------------------- The Nasdaq Stock Market, LLC, removed from listing the common stock of BankUnited Financial Corporation on July 13, 2009. Based on a review of the information provided by the Company, Nasdaq Staff determined that the Company no longer qualified for listing on the Exchange pursuant to Listing Rules 5100, 5110(b) and IM- 5100-1. The Company was notified of the Staffs determination on May 22, 2009. The Company did not appeal the Staff determination to the Hearings Panel, and the Staff determination to delist the Company became final on June 2, 2009. BankUnited Financial Corporation -- http://www.bankunited.com/-- was the holding company for BankUnited FSB, the largest banking institution headquartered in Coral Gables, Florida. On May 21, 2009, BankUnited FSB was closed by regulators and the Federal Deposit Insurance Corporation facilitated a sale of the bank to a management team headed by John Kanas, a veteran of the banking industry and former head of North Fork Bank, and a group of investors led by W.L. Ross & Co. BankUnited, FSB, had assets of $12.8 billion and deposits of $8.6 billion as of May 2, 2009. The Company and its affiliates filed for Chapter 11 on May 22, 2009 (Bankr. S.D. Fla. Lead Case No. 09-19940). Stephen P. Drobny, Esq., and Peter Levitt, Esq., at Shutts & Bowen LLP represents the Debtors in their restructuring efforts. The U.S. Trustee for Region 21 appointed three creditors to serve on an Official Committee of Unsecured Creditors. The Debtors' financial condition as of March 31, 2009, showed total assets of $37,729,520 and total debts of $559,740,185. The Debtors have $237,261,000 trust preferred securities, $120,000,000 convertible subordinated senior notes, $12,500,000 junior subordinated debentures, and $184,000,000 convertible subordinated senior HiMEDS. The Debtors listed 1,226,853 noncumulative convertible preferred stock, Series B; and $35,507,988 Class A and 719,947 Class B shares of common stock. BCH LAND HOLDING: Case Summary & 8 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: BCH Land Holding LLC PO Box 1738 North Hampton, NH 03862 Bankruptcy Case No.: 09-12851 Chapter 11 Petition Date: July 30, 2009 Court: United States Bankruptcy Court District of New Hampshire Live Database (Manchester) Judge: J. Michael Deasy Debtor's Counsel: William S. Gannon, Esq. William S. Gannon PLLC 889 Elm Street, 4th Floor Manchester, NH 03101 Tel: (603) 621-0833 Fax: (603) 621-0830 Email: bgannon@gannonlawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 8 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/nhb09-12851.pdf The petition was signed by Brian Hayes, sole member of the Company. BERNARD MADOFF: Picower Seeks Dismissal of Trustee Fraud Claims --------------------------------------------------------------- Jeffry Picower, the philanthropist and longtime Bernard Madoff investor, asked the U.S. Bankruptcy Court for the Southern District of New York to dismiss fraud claims in the suit brought against him by the trustee liquidating Madoff's business, Carla Main at Bloomberg news reported. Mr. Picower said the fraud claim against him "relies on baseless conclusions and idle speculation" and should be dismissed. According to the Bloomberg report, Mr. Picower, 67, a lawyer and philanthropist from Palm Beach, Florida, said July 31 in court papers that he was a victim of Madoff's fraud rather than a beneficiary. The foundation run by his wife, Barbara, was shuttered after Mr. Madoff's Dec. 11 arrest, he said. Mr. Picower's lawyer, William Zabel, said that his clients were upright citizens who weren't in a special position to know of Madoff's fraud and that the fraud "wiped out the Picowers' charitable foundation, which gave many millions to support medical research, the arts and education." As reported by the Troubled Company Reporter on May 15, 2009, Irving H. Picard, Esq., as trustee for the liquidation of the business of Bernard L. Madoff Investment Securities LLC, has filed a complaint against Jeffry M. Picower, his wife, his foundation and his related entities. Mr. Picard wants Mr. Picower, et al., to return transfers totaling of $6.7 billion, majority of which, the trustee says, are "other people's money." According to the Complaint, Jeffry Picower was a beneficiary of this Ponzi scheme for more than 20 years. Since December 1995, he and his related entities collectively profited from this scheme through the withdrawal of more than $6.7 billion dollars. The Trustee's investigation has revealed that at least five billion dollars of this amount was fictitious profit from the Ponzi scheme. In other words, Picower, et al., have received, at a minimum, more than five billion dollars of other people's money. The trustee's counsel, David J. Sheehan, Esq., at Baker & Hostetler LLP, in New York, asserts that, among other reasons, Mr. Picower "knew or should have known that they were profiting from fraud because of the implausibly high rates of return that their accounts supposedly achieved." According to Mr. Sheehan, Mr. Picower was one of a handful of BLMIS clients with special access to information from BLMIS, including access to information about BLMIS' 'target' rates of return for Picower's accounts. He noted that in several cases, Picower's purported annual rates of return were more than 100%, with some annual returns as high as 500% or even 950% per year. The average annual rate of return for the Picower Entities'' regular trading accounts between 1996 and 2007 was approximately 22%, even taking into account extremely low rates of return in 2000 (ranging as low as negative 770%). "These anomalous and astronomical rates of return - both positive and negative - were neither credible nor consistent with legitimate trading activity, and should have caused any reasonable investor to inquire further," Mr. Sheehan said. Mr. Picower, et al., also knew or should have known that they were reaping the benefits of manipulated purported returns, false documents and fictitious profit, Mr. Sheehan asserted. He cited some purported "trades" in Picower, et al.'s accounts supposedly took place before the relevant direction from Picower, or even before the relevant account was opened or funded. BLMIS records further suggest, according to Mr. Sheehan, that not only was Picower aware (or at a minimum, should have been aware) that BLMIS was creating backdated transactions, but that Picower and/or his agent may have used backdated documents to direct such backdated trades themselves. Mr. Sheehan asserts that the transfers or payments totaling $6.7 billion to Picower, et al., are avoidable and recoverable under Sections 544, 550(a)(1) and 551 of the Bankruptcy Code, applicable provisions of SIPA, particularly 15 U.S.C. Sections 78fff- 2(c)(3), and applicable provisions of N.Y. CPRL 203(g) (McKinney 2001) and N.Y. Debt. & Cred. Sections 273 - 276 (McKinney 2001). About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC was a market maker in U.S. stocks, including all of the S&P 500 and more than 350 Nasdaq stocks. The firm moved large blocks of stock for institutional clients by splitting up orders or arranging off-exchange transactions between parties. It also performed clearing and settlement services. Clients included brokerages, banks, and other financial institutions. In addition, Madoff Securities managed assets for high-net-worth individuals, hedge funds, and other institutional investors. The firm is being liquidated in the aftermath of a fraud scandal involving founder Bernard L. Madoff. As reported by the Troubled Company Reporter on December 15, 2008, the Securities and Exchange Commission charged Mr. Madoff and his investment firm with securities fraud for a multi-billion dollar Ponzi scheme that he perpetrated on advisory clients of his firm. The estimated losses from Mr. Madoff's fraud were allegedly at least US$50 billion. Also on December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. Irving H. Picard, Esq., was appointed as trustee for the liquidation of BLMIS, and Baker & Hostetler LLP was appointed as counsel. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors. BRAINTECH INC: EVP Osborn to Get Stock for July-Sept. Salary ------------------------------------------------------------ Braintech, Inc., reports that on July 29, 2009, effective as of July 1, the Company and Jerry L. Osborn, Executive Vice President, Braintech and President, Braintech Industrial, Inc., entered into an Amendment to Mr. Osborn's Employment Agreement. The Amendment provides that effective July 1, 2009, Mr. Osborn's salary and car allowance will be paid monthly in the form of restricted common stock based on the average closing price of the stock during the applicable month. If the Company does not begin to pay Mr. Osborn's salary in cash again starting with the first pay period of October 2009, then Mr. Osborn may elect to terminate his employment and sign a mutual general release with the Company. In this event (i) he will receive 3,500,000 shares of restricted common stock, (ii) the bonus stock which was placed in escrow under his Employment Agreement will vest, and (iii) the bonus stock options granted in connection with his Employment Agreement will vest and may be exercised for 36 months after his termination date. Headquartered in North Vancouver, B.C., Canada, Braintech Inc. (OTC BB: BRHI) -- http://www.braintech.com/-- has four wholly owned subsidiaries: Braintech Canada Inc., a British Columbia corporation, Braintech Government & Defense Inc., a Delaware corporation, Braintech Consumer & Service Inc., a Delaware corporation, and Braintech Industrial Inc., a Delaware corporation. Braintech Canada Inc. carries out the Company's research and development activities, and employs a majority of the company's technical personnel. The Company generates the majority of its revenues from the sale of robotic vision software that it has developed. The Company's software sales have principally involved computerized vision systems used for the guidance of industrial robots performing automated assembly, material handling, and part identification and inspection functions. As reported in the Troubled Company Reporter on January 2, 2009, in a November regulatory filing with the Securities and Exchange Commission, Braintech noted that its history of losses and significant deficit raises substantial doubt about its ability to continue as a going concern. The Company noted that it has generated only roughly $11.4 million in revenues since the inception its current operations January 3, 1994. The Company expects to incur operating losses in the future. As of March 31, 2009, the Company had $2,499,810 in total assets and $5,266,068 in total liabilities, resulting in $2,766,258 in stockholders' deficit. BRAINTECH INC: Gets $3MM SVB and $1.5MM 60-Day Credit Facilities ---------------------------------------------------------------- Braintech Inc. on July 27, 2009, signed a non-binding term sheet with Silicon Valley Bank for a new $3,000,000 credit facility. The SVB Credit Facility will consist of two parts: -- a $2,200,000 term loan, which will be interest only for 18 months from closing, and will then convert to an 18-month term loan, with final maturity 36 months from closing. The Term Loan will be secured by $2,200,000 in CDs or letters of credit from up to six parties; and -- an $800,000 credit line to be secured by the Company's accounts receivable. The Credit Line will mature 18 months from closing. The parties intend to negotiate and sign the definitive agreements for the SVB Credit Facility over the next four weeks. On July 29, Braintech entered into a temporary 60-day Credit Agreement dated as of July 11, 2009, with Royal Bank of Canada. The RBC Credit Agreement provides for a 60-day term facility of $1,506,000. The RBC Credit Agreement requires monthly payments of $50,000 and is payable in full on September 9, 2009. As with earlier credit agreements between the Company and RBC, the RBC Credit Agreement is secured by a first priority security interest on all of the Company's assets including its intellectual property and by letters of credit provided by the Company's CEO, the Company's Founder, a director of the Company, and other parties. The LC Providers have a security interest in all of the Company's assets including its intellectual property second in priority only to the security interest of RBC. Headquartered in North Vancouver, B.C., Canada, Braintech Inc. (OTC BB: BRHI) -- http://www.braintech.com/-- has four wholly owned subsidiaries: Braintech Canada Inc., a British Columbia corporation, Braintech Government & Defense Inc., a Delaware corporation, Braintech Consumer & Service Inc., a Delaware corporation, and Braintech Industrial Inc., a Delaware corporation. Braintech Canada Inc. carries out the Company's research and development activities, and employs a majority of the company's technical personnel. The Company generates the majority of its revenues from the sale of robotic vision software that it has developed. The Company's software sales have principally involved computerized vision systems used for the guidance of industrial robots performing automated assembly, material handling, and part identification and inspection functions. As reported in the Troubled Company Reporter on January 2, 2009, in a November regulatory filing with the Securities and Exchange Commission, Braintech noted that its history of losses and significant deficit raises substantial doubt about its ability to continue as a going concern. The Company noted that it has generated only roughly $11.4 million in revenues since the inception its current operations January 3, 1994. The Company expects to incur operating losses in the future. As of March 31, 2009, the Company had $2,499,810 in total assets and $5,266,068 in total liabilities, resulting in $2,766,258 in stockholders' deficit. BRSP LLC: S&P Changes Outlook to Negative; Retains 'CC' Rating -------------------------------------------------------------- Standard & Poor's revised its outlook on BRSP LLC's $290 million term loan due 2014 to CreditWatch with negative implications from CreditWatch with developing implications, to match the CreditWatch listing on its parent, CIT (CC/Negative/C). The rating remains unchanged at 'CC'. BRSP LLC is wholly-owned by CIT. Since BRSP is not ring-fenced from CIT, its debt rating is constrained by that of CIT. Based on the information currently available to us, S&P does not expect changes in the ring-fencing status of BRSP. S&P is withdrawing its debt rating on BRSP at the issuer's request. C & L LOFTS: Case Summary & 4 Largest Unsecured Creditors --------------------------------------------------------- Debtor: C & L Lofts, Inc 37 N Orange Ave #760 Orlando, FL 32801 Bankruptcy Case No.: 09-11186 Chapter 11 Petition Date: July 31, 2009 Debtor-affiliate that filed separate Chapter 11 petition April 9, 2009: Entity Case No. ------ -------- The Plaza, LLC 09-4661 Debtor-affiliate that filed separate Chapter 11 petition November 10, 2008: Entity Case No. ------ -------- Cornerstone-Orlando, LLC 08-10595 Court: United States Bankruptcy Court Middle District of Florida (Orlando) Debtor's Counsel: Elizabeth A. Green, Esq. Latham Shuker Eden & Beaudine LLP 390 North Orange Avenue, Suite 600 Orlando, FL 32801 Tel: (407) 481-5800 Fax: (407) 481-5801 Email: bankruptcynotice@lseblaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtors' petition, including a list of their 4 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-11186.pdf The petition was signed by Cameron B. Kuhn, president of the Company. CABINET DOOR: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Cabinet Door Company of Texas, Inc. 725 E. Main Street Lancaster, TX 75146 Bankruptcy Case No.: 09-34902 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Barbara J. Houser Debtor's Counsel: Eric A. Liepins, Esq. 12770 Coit Rd., Suite 1100 Dallas, TX 75251 Tel: (972) 991-5591 Email: eric@ealpc.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/txnb09-34902.pdf The petition was signed by Berry Bailey, president of the Company. CALPINE CORP: Court Approves Settlement With Noteholders -------------------------------------------------------- Calpine Corporation and its reorganized debtor affiliates obtained from Judge Burton Lifland of the U.S. Bankruptcy Court for the Southern District of New York approval of a settlement agreement dated May 22, 2009, they entered into with: * Manufacturers and Traders Trust Company, as Successor Indenture Trustee for Calpine's Subordinated Notes; * HSBC Bank USA, National Association, as Successor Indenture Trustee for certain of Calpine's Senior Notes; * U.S. Bank National Association, as Successor Indenture Trustee for certain of Calpine's Senior Notes; * UBS Securities, LLC, a noteholder; * SPO Advisory Corp., a noteholder; * each of Whitebox Hedged High Yield Partners LP, Pandora, Select Partners LP, Whitebox Special Opportunities Fund Series B Partners LP, Whitebox Convertible Arbitrage Partners LP, Whitebox Combined Partners LP, Cineasias Partners LP, DRE Partners LP, F Cubed Partners LP, and HFR RVA Combined Master Trust, each a noteholder; * Harbinger Capital Partners Master Fund I, Ltd., a noteholder; and * Goldman, Sachs & Co., a noteholder. Prior to the Petition Date, Calpine issued 7.625% Senior Notes due 2006, 8.75% Senior Notes due 2007, 7.875% Senior Notes due 2008, 7.75% Senior Notes due 2009, and 10.5% Senior Notes due 2006. Also, prior to the Petition Date, Calpine issued 7.75% Contingent Convertible Notes due 2015 pursuant to an Indenture, dated August 10, 2000, between Calpine and Wilmington Trust Company, as trustee, as supplemented by the Third Supplemental Indenture, dated June 23, 2005. The Subordinated Notes Indenture contains certain subordination provisions, the scope of which has been the subject of dispute between the Senior Noteholders and the Senior Notes Trustees on the one hand, and the Subordinated Noteholders and the Subordinated Notes Trustee on the other hand, for more than one year. On or about the Effective Date of the Reorganized Debtors' Plan of Reorganization, by agreement among Calpine, the Senior Notes Trustees, and the Subordinated Notes Trustee, Calpine (i) withheld 9,752,262 shares of New Calpine Common Stock from distribution to the Subordinated Noteholders and (ii) agreed to fund the Intercreditor Subordination Dispute Escrow Account with those shares. The purpose of the Intercreditor Subordination Dispute Escrow Account was to permit the Trustees to resolve a dispute regarding the appropriate division of the Reserved Shares, and upon resolution of the dispute, to immediately obtain their each of their distributions without further involvement by the Reorganized Debtors or the Bankruptcy Court. Because the Parties were unable to fully agree on the terms of an appropriate escrow arrangement, the Reorganized Debtors placed the Reserved Shares into a segregated reserve over which they maintain control. On February 21, 2008, the Subordinated Notes Trustee commenced an action by filing a complaint in the Supreme Court of the State of New York, in New York County, seeking a declaration that, among other things, the Subordinated Notes are not subordinated in right of payment to the prior payment in full of postpetition interest or post-effective date interest arising under the Senior Notes. The action was subsequently removed to the United States District Court for the Southern District of New York. The Senior Notes Trustees answered the Complaint and counterclaimed that the subordination provisions contained in the Subordinated Notes Indenture require payment in full of all amounts due on the Senior Notes, including postpetition interest and post-effective date interest, prior to the payment of any amounts due on the Subordinated Notes. Additionally, the Senior Notes Trustees and the Subordinated Notes Trustee each asserted a claim for declaratory relief as to the priority of the payment in full of trustee fees and expenses. Furthermore, HSBC and the Subordinated Notes Trustee each asserted a claim for declaratory relief concerning the priority of the payment in full of the Allowed Breach of Contract Claims granted to HSBC on behalf of the holders of the 7.875% Senior Notes Due 2008 and the 7.75% Senior Notes Due 2009 on account of their Asserted Breach of Contract Claims. Calpine and the Noteholder Parties negotiated in good faith regarding the Intercreditor Subordination Dispute, the Subordination Action, and the distribution of the Reserved Shares and have agreed to the Settlement Agreement, which, among other things, resolves the Intercreditor Subordination Dispute and the Subordination Action and provides for the distribution of the Reserved Shares. The highlights of the Settlement Agreement are: (i) Calpine will distribute the Reserved Shares from the Intercreditor Subordination Dispute Reserve: (a) 6,641,473 Reserved Shares will be distributed to the Subordinated Notes Trustee, for distribution to the Subordinated Noteholders in accordance with the distribution provisions of the Plan; and (b) a total of 3,110,789 Reserved Shares will be distributed to HSBC and U.S. Bank, in their capacities as Senior Notes Trustees, for distribution to the respective Senior Noteholders in accordance with the distribution provisions of the Plan and the respective indentures governing the Senior Notes; (ii) any and all future distributions after the date of the Settlement Agreement by Calpine from the disputed claims reserve under the Plan otherwise distributable to the class of Senior Noteholders and to the class of Subordinated Noteholders will be allocated, in accordance with the terms of the Plan, first to the Subordinated Noteholders to the extent necessary to result in the actual recovery and payment in full of the claims for principal and prepetition interest of the Subordinated Noteholders, whereupon all future distributions otherwise distributable to the class of Senior Noteholders and to the class of Subordinated Noteholders, from the disputed claims reserve will be allocated 65% to the Subordinated Noteholders and 35% to the Senior Noteholders, on a pro rata basis and for purposes of the Senior Notes, in accordance with certain percentages, as more fully set out in the Settlement Agreement; and (iii) promptly after the Subordinated Notes Trustee has released certain shares of New Calpine Common Stock under its control, the Subordinated Notes Trustee and the Senior Notes Trustees will prepare, execute, and file with the District Court a joint stipulation for the dismissal with prejudice of the Subordination Action, and each of the parties will cooperate with one another and take any and all further steps necessary to secure dismissal of the Subordination Action, including all claims and counterclaims, with prejudice. The Reorganized Debtors assert that the resolution of the Intercreditor Subordination Dispute and the Subordination Action benefits two of their largest creditor constituencies, the Senior Noteholders and the Subordinated Noteholders, by eliminating the uncertainty with respect to the recovery of those constituencies and thereby facilitates full and complete consummation of the Plan. "Resolution of the Intercreditor Subordination Dispute and the Subordination Action will move the Chapter 11 Cases closer to conclusion and allow the Reorganized Debtors' professionals and management to concentrate their efforts on running the Reorganized Debtors' business and operations, which is in the best interests of all creditors.," says James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in New York. Mr. Mazza adds that a clear majority of both the Senior Noteholders and the Subordinated Noteholders have expressed support for the Settlement Agreement by issuing direction letters to their Trustees directing them to enter into the Settlement Agreement on behalf of all holders. At a minimum, Mr. Mazza notes, the Settlement Agreement is not opposed by any significant party-in-interest. About Calpine Based in San Jose, California, Calpine Corporation (OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers and communities with electricity from clean, efficient, natural gas-fired and geothermal power plants. Calpine owns, leases and operates integrated systems of plants in 21 U.S. states and in three Canadian provinces. Its customized products and services include wholesale and retail electricity, gas turbine components and services, energy management and a wide range of power plant engineering, construction and maintenance and operational services. The Company and its affiliates filed for Chapter 11 protection on December 20, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G. Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their restructuring efforts. Michael S. Stamer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. As of Aug. 31, 2007, the Debtors disclosed total assets of $18,467,000,000, total liabilities not subject to compromise of $11,207,000,000, total liabilities subject to compromise of $15,354,000,000 and stockholders' deficit of $8,102,000,000. On February 3, 2006, two more affiliates, Geysers Power Company, LLC, and Silverado Geothermal Resources, Inc., filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 06-10197 and 06- 10198). On September 20, 2007, Santa Rosa Energy Center, LLC, another affiliate, also filed a voluntary Chapter 11 petition (Bankr. S.D.N.Y. Case No. 07-12967). On June 20, 2007, the Debtors filed their Chapter 11 Plan and Disclosure Statement. On August 27, 2007, the Debtors filed their Amended Plan and Disclosure Statement. Calpine filed a Second Amended Plan on September 19, 2007 and on September 24, 2007, filed a Third Amended Plan. On September 25, 2007, the Court approved the adequacy of the Debtors' Disclosure Statement and entered a written order on September 26. On December 19, 2007, the Court confirmed the Debtors' Plan. The Amended Plan was deemed effective as of January 31, 2008. (Calpine Bankruptcy News; Bankruptcy Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or 215/945-7000). CASTLE MEGASTORE: Emerges from Chapter 11; Names Franks as CEO -------------------------------------------------------------- Castle Megastore said it has emerged from bankruptcy, achieving a new milestone in its reinvention as a leading adult retailer. Mark A. Franks will take ownership and continue to fulfill the positions of president and chief executive officer. The company officially exited its Chapter 11 reorganization after meeting all closing conditions to the company's plan of reorganization, which was confirmed by the U.S. Bankruptcy Court for the District of Arizona in an order entered on May 19, 2009. In connection with closing the sale transaction, Castle Megastore Group, Inc. will take ownership and operate Castle Megastore's retail stores. The new Castle Megastore will continue to operate in its corporate office in Tempe, Ariz. "Today marks a defining moment in the reinvention of Castle Megastore as a more customer-focused and leading adult retailer," says Mr. Franks. "This has been a challenging period, but now is the opportunity to take Castle Megastore to the next level and create a more focused and flexible brand. "We are dedicated to adhering to our core values of exceptional service, revolutionary promotions and great product selections to the benefit of our customers, employees, industry partners and stakeholders. This is an exciting opportunity to re-position the company for long-term success," he says. The new Castle Megastore will execute the key elements of its plan along with additional initiatives to achieve winning results. Concentrating on adding to the company's retail locations and continuing to expand the brand are only the beginning of new plans on the horizon. "We launched a series of initiatives over the past few years to enhance the company's operational performance and refine our merchandising and marketing strategy," says Franks. "Now we are poised to take on new avenues to strengthen our brand." Future innovations rolling out will be Castle Megastore's radio station and customer relationship management technology. Castle Radio will include personal interviews with the top performers in the industry. Live feeds from its more than 100 signings -- and counting -- will feature performers like Jenna Jameson, Ron Jeremy, Jesse Jane, Belladonna, Stoya and Tera Patrick. Castle Radio will also feature special events like the signature Halloween Fashion Show and bridal shows. Utilizing CRM software, Castle Megastore will be able to analyze customer trends and send customized email communication to help drive sales. Along with personalized emails, customers will be able to sign up for a loyalty card that will provide exclusive benefits and discounts to members. Under the leadership of Mr. Franks, the Company said in a statement the year has been a successful one. It is the recipient of the Retailer of the Year award at the XBIZ Awards held in Hollywood, Calif. The annual awards show honors excellence and achievement in adult film, novelty, Internet and retail categories. Castle Megastore was also nominated for the Outstanding Retail Chain "O" Award, presented by AVN Media Network, AVN Novelty Business magazine and AVN Novelty Expo. The inaugural awards honor outstanding achievement in the pleasure product industry. "Castle Megastore is thrilled to have won and been nominated for significant awards in the adult industry in the same year," says Mr. Franks. "We stand among distinguished industry leaders who have had the privilege of receiving awards like these in the past." Castle Megastore -- http://www.castlemegastore.com/-- is an adult retailer with 16 stores operating in Alaska, Arizona, New Mexico, Oregon and Washington. CELL THERAPEUTICS: Files Monthly Update at CONSOB's Directive ------------------------------------------------------------- Pursuant to a request from the Italian securities regulatory authority, CONSOB, Cell Therapeutics, Inc., provided a monthly update of certain information relating to the Company's management and financial situation with the U.S. Securities and Exchange Commission. Financial information normally reported by the Company on a monthly basis, including earnings before interest, taxes, depreciation and amortization and the net financial indebtedness, as of June 30, 2009, will be promptly reported by August 6, 2009, following the Company's quarterly filing of financial information for the three and six month periods ended June 30, 2009, with the SEC. During the month of June 2009, these transactions contributed to the change in the number shares of the Company's outstanding Common Stock: -- The issuance of 24,235,986 shares of Common Stock in connection with the settlement of the Exchange Offers. -- The issuance of 180,300 shares of Common Stock relating to stock awards under the Company's 2007 Equity Incentive Plan. -- The issuance of 5,600 shares of Common Stock under the Company's 2007 Employee Stock Purchase Plan. -- The Company is not aware of any agreement for the resale of its shares of Common Stock on the MTA nor of the modalities by means of which shares of Common Stock were or will be resold. In June 2009, the Company did not issue any new debt instruments. The Company believes it is in compliance with the covenants on each series of its outstanding convertible notes. The Company announced the results of the Exchange Offers on June 19, 2009. In particular the Exchange Offers resulted in the elimination of approximately $52.9 million in debt that is expected to reduce the Company's annual interest expense by approximately $3.3 million. On July 7, Cell Therapeutics said it had requested and the European Medicines Agency has agreed to an oral explanation in support of the OPAXIO Marketing Authorization Application in September 2009, which extends the review for the Committee for Medicinal Products for Human Use opinion on approval until the fourth quarter of 2009. On July 22, Cell Therapeutics entered into an underwriting agreement with Rodman & Renshaw, LLC to issue and sell 29,332,107 shares of the Company's common stock, no par value, and warrants to purchase up to 7,333,027 shares of Common Stock, at a public offering price of $1.30 per share of Common Stock and warrant to purchase 0.25 shares of Common Stock. Each warrant has an exercise price of $1.70 per share of Common Stock. The warrants are exercisable immediately upon the date of issuance and terminate nine months after the date of issuance. All shares and warrants were offered by the Company and were sold under the Company's registration statement on Form S-3 (File No. 333- 158272), as supplemented by the prospectus supplement filed with the Securities and Exchange Commission on July 22. The Company granted the Underwriter a 30-day option to purchase up to 4,399,816 additional shares of Common Stock and warrants to purchase up to 1,099,954 additional shares of Common Stock to cover over-allotments and the Company announced on July 24 that the Underwriter elected to exercise the over-allotment option in full at the closing of the Offering. On July 28, the Company closed the Offering. In connection with the Offering and as partial compensation for the Underwriter's services, the Company issued to the Underwriter a warrant to purchase up to 586,642 registered shares of Common Stock at an exercise price of $1.70 per share. This warrant is exercisable commencing on the date six months from the issuance date and expiring five years from the closing date of the Offering. The Company received $41.7 million, net of underwriting discount, from the sale of 33,731,923 shares of Common Stock and warrants to purchase up to 8,432,981 shares of Common Stock in a public offering. A full-text copy of the Company's disclosure is available at no charge at http://ResearchArchives.com/t/s?4090 About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc., (Nasdaq and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. At March 31, 2009, the Company's balance sheet showed total assets of $42.9 million and total liabilities of $158.9 million, resulting in a stockholders' deficit of about $116.0 million Going Concern Doubt Stonefield Josephson Inc. in Los Angeles, California, expressed substantial doubt about Cell Therapeutics' ability to continue as a going concern after auditing company's financial statements for the years ended December 31, 2008, and 2007. The auditing firm reported that the Company has substantial monetary liabilities in excess of monetary assets as of December 31, 2007, including approximately $19.8 million of convertible subordinated notes and senior subordinated notes which mature in June 2008. It also noted that the Company has sustained loss from operations over the audit periods, incurred an accumulated deficit, and has substantial monetary liabilities in excess of monetary assets as of December 31, 2008. CELL THERAPEUTICS: Registers 8,432,981 Shares of Common Stock ------------------------------------------------------------- Cell Therapeutics, Inc., filed a Registration Statement and Prospectus on Form S-3 with the Securities and Exchange Commission relating to its plan to offer up to 8,432,981 shares of common stock, no par value, from time to time upon the exercise of warrants issued and sold by the Company in connection with its underwritten public offering of shares of common stock and the warrants on July 22, 2009. Each warrant described in the prospectus entitles its holder to purchase 0.25 shares of common stock at an exercise price of $1.70 per share of common stock. The warrants are currently exercisable and must be exercised on or before April 28, 2010. The warrants are not listed on any national securities exchange. The Company's common stock is quoted on The NASDAQ Capital Market and on the MTA stock market in Italy under the symbol "CTIC". On July 30, 2009, the last reported sale price of the Company's common stock on The NASDAQ Capital Market was $1.49. A full-text copy of the Prospectus is available at no charge at: http://ResearchArchives.com/t/s?408f About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc., (Nasdaq and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. At March 31, 2009, the Company's balance sheet showed total assets of $42.9 million and total liabilities of $158.9 million, resulting in a stockholders' deficit of about $116.0 million Going Concern Doubt Stonefield Josephson Inc. in Los Angeles, California, expressed substantial doubt about Cell Therapeutics' ability to continue as a going concern after auditing company's financial statements for the years ended December 31, 2008, and 2007. The auditing firm reported that the Company has substantial monetary liabilities in excess of monetary assets as of December 31, 2007, including approximately $19.8 million of convertible subordinated notes and senior subordinated notes which mature in June 2008. It also noted that the Company has sustained loss from operations over the audit periods, incurred an accumulated deficit, and has substantial monetary liabilities in excess of monetary assets as of December 31, 2008. CENTERLINE CAPITAL: S&P Affirms Counterparty Rating at 'B+' ----------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its ratings on Centerline Capital Group, including the 'B+' counterparty rating. The outlook remained negative. Subsequent to the affirmation, S&P withdrew its ratings on the company, at the issuer's request. CIT GROUP: Raises Offer to 87.5 Cents on the Dollar --------------------------------------------------- CIT Group Inc. (NYSE: CIT) on August 3 announced that, with the consent of the lenders' steering committee for its recently announced $3 billion secured credit facility, it has amended its pending tender offer for its $1 billion of Floating Rate Senior Notes due August 17, 2009. "We are pleased to announce a constructive resolution to the tender offer as we continue to make progress in the development and execution of a broad restructuring plan that positions CIT for the long-term," said Jeffrey M. Peek, Chairman and CEO. As a result of the amendment, holders of all Notes tendered prior to the expiration date at midnight, New York City time, at the end of Friday, August 14, 2009, will receive the amended purchase price of $875 in cash per $1,000 principal amount of Notes, as total consideration in the Offer. Previously, the purchase price, which included an early delivery payment, was $825 per $1,000 principal amount of Notes. CIT announced that the amendment to the Offer also reduces the minimum tender condition to 58% of the Notes, an amount approximately equal to the number of Notes which pursuant to the Credit Facility the lenders are committed to tender and not withdraw. As of 5:00 p.m., New York City time, on Friday, July 31, 2009, CIT had received tenders for 64.97% of the Notes. The withdrawal deadline for the Offer has been extended until midnight, New York City time, at the end of Wednesday, August 5, 2009. All other terms of the Offer remain unchanged. Morgan Stanley & Co. Incorporated and BofA Merrill Lynch are the Dealer Managers for the Offer. D.F. King & Co., Inc. is the Depositary and Information Agent. Persons with questions regarding the Offer should contact Morgan Stanley & Co. Incorporated toll free at (800) 624-1808 or collect at (212) 761-5384 or BofA Merrill Lynch at (980) 388-4813, Attn. Debt Advisory Services. Requests for documents should be directed to D.F. King & Co., Inc. toll free at (800) 758-5880 or collect at (212) 269-5550. The terms and conditions of the Offer are set forth in the Offer to Purchase dated July 20, 2009, and the Supplement dated July 23, 2009, copies of which are available from the Information Agent. Individuals interested in receiving future updates on CIT via e- mail can register at http://newsalerts.cit.com Restructuring Plan CIT has announced a comprehensive restructuring of its liabilities to provide additional liquidity and further strengthen its capital position. Aside from the $3 billion loan, CIT commenced a cash tender offer for its outstanding floating-rate senior notes due August 17, 2009. The price offered is less than face value, and the Company has indicated that without a successful tender offer it may have to file for bankruptcy protection. CIT said July 15 that it has been advised that there is no appreciable likelihood of additional government support being provided over the near term. The Company's Board of Directors and management, in consultation with its advisors, are evaluating alternatives. CIT has more than $1 billion of unsecured notes maturing in both third- and fourth-quarter 2009. Payments for these notes could become increasingly difficult to make if borrower draws increase significantly and CIT does not win regulatory approval of its strategic initiatives, Standard & Poor's said. CIT applied for access to government aid before $1 billion in bonds mature next month. Since Nov. 25 the Federal Deposit Insurance Corp. has backed $274 billion in bond sales under its Temporary Liquidity Guarantee Program. However, the FDIC was apprehensive to approve the application because of CIT's worsening credit quality. This led to reports that CIT, which serves as lender to 950,000 businesses, is preparing for a bankruptcy filing. According to the Wall Street Journal, CIT Group hired Skadden, Arps, Slate, Meagher & Flom, LLP, to prepare for a bankruptcy filing. About CIT Group CIT Group Inc. -- http://www.cit.com/-- is a bank holding company with more than $60 billion in finance and leasing assets that provides financial products and advisory services to small and middle market businesses. Operating in more than 50 countries across 30 industries, CIT provides an unparalleled combination of relationship, intellectual and financial capital to its customers worldwide. CIT maintains leadership positions in small business and middle market lending, retail finance, aerospace, equipment and rail leasing, and vendor finance. Founded in 1908 and headquartered in New York City, CIT is a member of the Fortune 500. CIT Group reported $75.7 billion in assets and $68.2 billion in liabilities, including $3 billion in deposits, at the end of the first quarter. As reported by the TCR on July 24, Standard & Poor's Ratings Services said that its ratings on CIT Group Inc. (CC/Negative/C) are not immediately affected by the company's announcement that it had initiated a recapitalization plan and entered into a $3 billion loan facility provided by a group of major bondholders. "The current rating level continues to reflect a significantly heightened risk of bankruptcy," S&P said. As part of the restructuring, CIT commenced a cash tender offer for its outstanding floating-rate senior notes due August 17, 2009. Noting that the price offered is less than face value, S&P said that, in accordance with criteria, upon completion of the offer, it will lower its counterparty credit rating on the company to 'SD' (selective default) and lower the ratings on the affected debt issue to 'D'. As reported by the TCR on July 20, Moody's Investors Service lowered CIT Group's senior unsecured rating to Ca from B3 and issuer rating to Ca from B3. The downgrade follows CIT's announcement that that it expects no additional support from the U.S. government and that it is evaluating alternatives, which Moody's believes includes a high probability of a near-term bankruptcy filing. COLONIAL BANCGROUP: Fitch Downgrades Issuer Default Rating to 'C' ----------------------------------------------------------------- Fitch Ratings has downgraded the ratings of The Colonial BancGroup (CNB) and its subsidiaries. The ratings have been removed from Rating Watch Evolving where they were placed on June 9, 2009. A complete list of ratings follows the end of this release. The rating action follows the announcement that the pending $300 million investment by Taylor Bean & Whitaker and its consortium of investors has terminated. CNB was mandated to raise $300 million in equity from the private sector in order to receive the much needed $550 million of capital through the Treasury's Capital Purchase Program, for which CNB already received preliminary approval. Furthermore, CNB had entered into a Cease and Desist Order with the Alabama State Banking Department and FDIC in June 2009, and most recently with the Federal Reserve on July 22, 2009. Among various asset quality and management improvements, the C&Ds require CNB to increase Colonial Bank's Tier I capital ratio to 8% and Total Risk Based Capital ratio to 12% by September 30, 2009; Colonial Bank's Tier I and Total Risk Based Capital ratios were 6.46% and 9.21% at June 30, 2009. Fitch believes it will be extremely challenging for CNB to raise the required capital by the September 30, 2009 deadline. Apart from the C&Ds, escalating credit problems have continued to generate significant losses, further weakening the company's capital position, and eroding the benefit of potential capital augmentations, resulting in a net loss of $606 million for second quarter-2009 (2Q'09). A $25 billion banking company headquartered in Montgomery, Alabama, CNB has become a Florida concentrated institution, with the majority of the company's deposits and assets (including mortgage warehouse) located within the state. In addition to Florida and Alabama, Colonial also has a presence in the states of Georgia, Texas and Nevada. Fitch has downgraded these ratings and removed them from Rating Watch Evolving: The Colonial BancGroup, Inc. -- Long-term Issuer Default Rating (IDR) to 'C' from 'CCC'. Colonial Bank -- Long-term IDR to 'C' from 'B-'; -- Long-term deposits to 'CC/RR3' from 'B/RR3'; -- Short-term IDR to 'C' from 'B'; -- Short-term deposits to 'C' from 'B'; -- Subordinated debt to 'C/RR6' from 'CC/RR6'. Fitch has affirmed these ratings: The Colonial BancGroup, Inc. -- Subordinated debt at 'C/RR6'; -- Short-term IDR at 'C'; -- Individual at 'E'; -- Support at '5'; -- Support Floor at 'NF'. Colonial Bank -- Short-term deposits at 'C'; -- Individual at 'E'; -- Support at '5'; -- Support Floor at 'NF'. Colonial Capital Trust IV -- Preferred stock at 'C/RR6'. CBG Florida REIT -- Preferred stock at 'C/RR6'. CONSTELLATION ENERGY: Fitch Downgrades Junior Notes to 'BB+' ------------------------------------------------------------ Fitch Ratings has downgraded Constellation Energy Group's Issuer Default Rating to 'BBB-' from 'BBB' and Baltimore Gas & Electric's IDR to 'BBB' from 'BBB+'. Fitch also removes the IDRs of both companies from Rating Watch Evolving and assigns Stable Rating Outlooks. The downgrade of CEG's ratings reflects a review of the expected future corporate cash flows from CEG's businesses and the amount of debt expected under two scenarios. Fitch considered a primary case in which the agreed sale of a 49.99% joint venture interest in Constellation Energy Nuclear Generation to Electricite de France is consummated, and an alternate case that considers the consequences if the sale of the nuclear interest (the EDF Transaction) is not completed. Currently the Maryland Public Service Commission is conducting proceedings to determine if the EDF Transaction is in the public interest, and CEG is simultaneously cooperating with the MPSC proceedings while also continuing to challenge the MPSC's jurisdiction to rule on the transaction. The MPSC revised its schedule and now foresees completing its hearings by October 16, three weeks beyond its earlier expedited time line. The EDF investment agreement will terminate on December 17, 2009, unless extended by the parties. While the primary scenario (with the EDF Transaction) would result in greater near-term debt reduction and more favorable credit ratios in 2010-2011, the alternate scenario would have more robust cash flow and potential debt reduction in 2012 and thereafter. On balance, Fitch considered the outcome of either of the two scenarios combined with the significant improvement CEG has brought about in its risk profile and corporate liquidity to be consistent with an investment grade IDR of 'BBB-'. Fitch's removal of CEG from Watch Evolving and assignment of a Stable Outlook reflects the company's accomplishment of the divestiture of its Houston and London commodity trading businesses and a material reduction of its trading exposures and collateral and contingent collateral needs relating to trading exposures. Lower net collateral and margin resulted in positive cash flows of $1.1 billion in the first half of 2009, and CEG reported an increase in its net available liquidity at June 30 2009, to $5 billion versus $4 billion at April 30 and $2.6 billion at March 31. CEG has also begun the process of adding new sources of liquidity to replace credit facilities that expire in 2009 and facilities that will terminate upon closing the EDF Transaction. Consequently, CEG has stabilized its liquidity and its future back-up facilities can be resized to a more realistic level. Both CEG and EDF, CEG's largest shareholder at approximately 8.5% ownership, appear intent upon carrying out their investment agreement, and there is a reasonable chance that the parties will negotiate a settlement including the MPSC that permits the transaction to go forward, although that could be at the cost of some trade-offs. While there is undoubtedly headline risk associated with the MPSC proceedings on the EDF Transaction, CEG's survival no longer hinges on completing the EDF Transaction. BGE's individual IDR was downgraded in consideration of the utility's weak and inconsistent cash flows over the past four to five years and its continuing exposure to political and regulatory pressure that could result in ongoing constraints on cash flow and weak credit measures. BGE is protected from variations in power supply costs and volume variations by means of purchased gas and purchased power recovery mechanisms, gas weather normalization, and electric decoupling. However, the utility is facing higher capital expenditures over the next three years and is likely to experience a lag in the cash recovery of the new investments. Projected credit ratios for BGE are likely to decline after 2009 and are expected to be comparable to those of peer utilities in the 'BBB' IDR category. Fitch's removal of BGE from Watch Evolving and assignment of a Stable Outlook reflects parent CEG's improved business and financial risk profile and stabilized liquidity. BGE's gas and electric utility business will represent about one-quarter to one-third of CEG's expected EBITDA going forward. While BGE's ratings and Outlook are not dependent upon completion of the EDF Transaction or absence of the transaction, the credit could be affected if material concessions are made to facilitate a settlement with the MPSC. The CEG Rating Scenarios In Fitch's primary scenario the EDF Transaction is executed by year-end 2009, and CEG's debt burden is reduced as transaction proceeds are used to replace expiring credit facilities and to repay debt. In this case, total operating cash flow is lower in the longer run because the profitable nuclear generation business is shared with EDF as a joint venture partner; however, any cash flow reduction in 2010 and 2011 would be largely or wholly offset by a part of the EDF investment agreement that calls for EDF to transfer $700 million present value to CEG, likely to be effected through a power purchase contract between the joint venture and CEG. In 2012 and beyond, credit measures would likely be less robust with the EDF Transaction than in the alternate scenario. In the alternate scenario, without the EDF Transaction, CEG would retain the full cash flows from its nuclear plant portfolio, but would not receive the up-front transaction payment from EDF (a net amount of approximately $3.5 billion pre-tax) nor the present value transfer of $700 million pre-tax during the first two years after the transaction. In the alternate scenario (without EDF Transaction), Fitch assumed that in order to support liquidity, CEG would exercise its option to sell certain non-nuclear power plants to EDF at specified prices (the EDF Put), resulting in after-tax proceeds of around $1.4 billion, an amount that would more than cover the $1 billion redemption of preferred stock held by EDF in the event of the transaction termination. CEG has so far received regulatory approvals needed to transfer assets subject to the EDF Put that aggregate $1.1 Billion of net proceeds. If the EDF Put is exercised, CEG would forego cash flows from the plants sold to EDF, offset by the cash flows of the retained half interest in CENG. Under this scenario, CEG would not reduce material amounts of debt in the near-term; leverage measures would likely be higher and interest coverage somewhat lower through 2012. In 2012 and beyond, this scenario is likely to produce more robust cash flow and credit measures because of the retention of the full ownership of CENG and especially so if a carbon pricing regime enhances the long-term cash flow of the nuclear operations. In both the primary and alternate scenarios, Fitch considered the financial benefits to CEG of the high contractual cover EBITDA from generation for 2009 (100%), 2010 (84%) and 2011 (57%) at favorable prices relative to currently depressed spot market prices. After 2011, the majority of CEG's expected power output is exposed to market prices for replacement contracts. CEG's competitive customer supply business currently benefits from improved pricing conditions and business terms in that marketplace, offsetting voluntary or involuntary volume declines. CEG and its partner EDF continue to participate in a separate joint venture (UniStar) to construct new nuclear plants in the U.S., including Calvert Cliffs 3 in Maryland, contingent upon financing availability and Nuclear Regulatory Commission and other approvals; that plan is not reflected in the CEG ratings as it is still beyond Fitch's credit horizon. Fitch downgrades these ratings and assigns Stable Outlooks to the long-term ratings: Constellation Energy Group, Inc. -- Long-term IDR to 'BBB-' from 'BBB'; -- Senior unsecured notes to 'BBB-' from ' BBB'; -- Short-term IDR to 'F3' from 'F2'; -- Commercial paper to 'F3' from 'F2'; -- Junior subordinated notes to 'BB+' from 'BBB-'. Baltimore Gas and Electric Company -- Long-term IDR to 'BBB' from 'BBB+'; -- Rating Outlook to Stable from Watch Evolving -- Senior unsecured notes/pollution control revenue bonds to 'BBB+' from 'A-'; -- Preferred stock to 'BBB' from 'BBB+'. BGE Capital Trust II -- Preferred stock to 'BBB' from 'BBB+'. In addition, Fitch affirms these ratings: Baltimore Gas and Electric Company -- Short-term IDR affirmed at 'F2'; -- Commercial paper affirmed at 'F2'. Fitch has also removed the above ratings from Rating Watch Evolving. CONTINENTAL AIRLINES: Fitch Affirms Issuer Default Rating at 'B-' ----------------------------------------------------------------- Fitch Ratings has affirmed the Issuer Default Rating for Continental Airlines, Inc., at 'B-' and has revised the company's senior unsecured rating to 'CC/RR6' from 'CCC/RR6' in accordance with Fitch's updated notching guidelines. The revision of the unsecured debt rating follows recent changes in Fitch's notching criteria for issuers with IDRs of 'B-' or below. The Rating Outlook for CAL is Stable. The rating affirmation follows a period of extreme revenue pressure driven by the global recession that has undermined CAL's ability to return to profitability and consistently positive free cash flow. While the dramatic pull-back in crude oil and jet fuel prices since last summer's peak has offset much of the revenue weakness in first half-2009 (1H'09), the industry revenue outlook remains very weak. In particular, the sharp decline in high-fare business bookings seen over the last several months has eroded passenger unit revenue dramatically, with no indications of a quick reversal in business demand trends moving into the fall. Given the weak revenue outlook and the potential for intensifying liquidity pressures through 2H'09, CAL's relatively strong unrestricted cash position will continue to provide the carrier with more flexibility than its network carrier rivals during a period of extreme operating stress. As of June 30, CAL reported total unrestricted cash and short-term investments of $2.8 billion. This represents more than 20% of total revenues over the last twelve months -- a ratio that remains superior to that seen at other network carriers such as United, US Airways and American. Looking ahead to the end of the third quarter, CAL expects unrestricted liquidity to total $2.4 billion. Like all of the U.S. global network carriers, CAL reported big declines in revenue per available seat mile during the second quarter, driven in large part by the collapse in high-fare business travel demand linked to the recession. Mainline RASM fell by 17% in the second quarter, with an 18% decline in mainline passenger yields accounting for all of the RASM drop. As high- yield demand has dried up, CAL and its competitors have continued to discount fares aggressively to stimulate leisure demand and boost load factors. Management noted on its July 21 earnings call that RASM deterioration appeared to be stabilizing at low levels in June and July. However, the outlook for business demand during the post-Labor Day period remains highly uncertain. Fitch now regards full-year 2009 RASM declines in excess of 10% as more likely for CAL and its global network carrier competitors, raising the risk that free cash flow will remain negative for at least the next two quarters. In response to the soft demand outlook, particularly in hard-hit trans-Atlantic markets, CAL announced plans on July 21 to adjust mainline capacity down further in the post-August period. Mainline capacity for the full year is now projected to be down 5.6%, and trans-Atlantic capacity is projected to fall by 9.1% this year. Furthermore, CAL plans to reduce headcount by an additional 1,700 positions as part of the capacity reduction initiative. This should help counter much of the unit cost pressure linked to the 2009 capacity pull-down. Non-fuel unit cost pressure has been fairly modest in 1H'09, as CAL has been successful in trimming costs -- particularly on the labor line as the size of the network has been reduced in response to the weak demand environment. Fuel remains a source of significant cash savings this year following the steep drop in energy prices after last July's peak. CAL projects full-year 2009 fuel cost savings of $2.7 billion based on the current full year average consolidated jet fuel price assumption of $1.92 per gallon. As underwater fuel derivative positions have rolled off this year, cash flow volatility driven by the need to post cash collateral with hedge counter-parties has diminished. For all of 2009, CAL's fuel hedges are expected to drive an increase of approximately 24 cents per gallon in the average jet fuel price paid. CAL's relative liquidity strength is likely to be eroded somewhat through 2010 even if the revenue environment improves modestly in line with a global economic recovery next year. In particular, cash balances will be impacted by heavy scheduled debt maturities of $943 million in 2010 and $1.1 billion in 2011. CAL's recent success in tapping the aircraft-backed debt markets bodes well for a potential refinancing of those maturing obligations, but a return to tighter credit market conditions would put more pressure on CAL's liquidity position if maturities must be met solely out of cash balances and weak free cash flow. CAL also faces a need to fund its defined benefit pension plans, which remain substantially under-funded. Required cash contributions, projected at $150 million this year, are likely to rise in 2010 as a result of weak asset returns in 2008 and a larger unfunded liability. Fitch may revise CAL's Rating Outlook to Negative or downgrade the ratings in the coming months if no evidence of recovery in global business travel demand appears, driving a continuation of large year-over-year declines in RASM and persistent operating losses for CAL. A decline in unrestricted liquidity to less than $2.0 billion, in light of the heavy 2010 and 2011 debt maturities, could also trigger a negative rating action. Fitch views the continuation of improved capital market access trends as vital for CAL in preserving liquidity during the industry downturn. COOPER-STANDARD: Files Chapter 11 to Restructure Balance Sheet -------------------------------------------------------------- Cooper-Standard Holdings Inc., and its affiliates, including Cooper-Standard Automotive Inc., on August 3 filed voluntary petitions for reorganization under Chapter 11 before the U.S. Bankruptcy Court for the District of Delaware. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, will seek relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Certain of the Company's current lenders have agreed to provide the Company with up to $175 million in debtor-in-possession (DIP) financing. The DIP financing consists of a $175 million superpriority delayed draw term loan facility plus a $25 million standby uncommitted single draw term loan facility. The DIP financing is subject to approval of the U.S. and Canadian bankruptcy courts. The Company will use the funds, along with its current cash balance and future cash flow, to formulate and implement a restructuring plan and pay normal operating expenses, including employee wages and payments to suppliers. The Company currently has $15 million in cash on hand. Cooper-Standard filed a variety of customary first day motions with the U.S. Bankruptcy Court in Delaware to enable it to continue business as usual during the restructuring, including requests to continue paying employee wages and benefits as usual. The Company intends to continue operating "business as usual" during the reorganization process and anticipates no interruption in its supply to customers. The filings include all wholly-owned U.S. and Canada operations. The Company's joint venture entities in the U.S. and around the world are not included in the filing. Cooper-Standard's other foreign subsidiaries are not included in the filing and will not be impacted. "Restructuring the Company's balance sheet to align with the new automotive marketplace is the right decision at the right time," said James S. McElya, Chairman and Chief Executive Officer of Cooper-Standard. "Today's action will allow the Company to maintain its leadership position in the industry, preserve its business relationships and continue providing innovative technology to our customers. We expect to emerge from Chapter 11 a much stronger and more competitive Company." Restructuring Plan Before filing for bankruptcy, the Company engaged in negotiations with senior lenders, while continuing to pursue alternatives with equity sponsors Goldman Sachs and Cypress Group. According to the Company's news release, significant progress has been made in these negotiations and the Company is hopeful that it will reach agreement with its lenders and other constituents and be able to implement an agreement in the near term. Under the most recent proposal supported by holders of a majority of the Company's senior secured debt, the Company's balance sheet would be significantly deleveraged, as the Company would reduce its approximately $1.1 billion of bank and bond indebtedness to approximately $350 million. In addition, the lenders' proposal contemplates an exit financing facility of $100 million to $150 million. The balance sheet restructuring follows an operational restructuring implemented in March 2009 that has enabled the Company to realize $47 million in annual savings. Allen J. Campbell, vice president and CFO of Cooper-Standard, said in the "first-day affidavit" that while the Debtors have made progress in negotiations with the senior lenders, the Debtors have not yet reached agreement on the terms of the Chapter 11 plan. Outstanding Indebtedness In its bankruptcy petition, the Company said that assets on a consolidated basis total $1,733,017,000 while debts total $1,785,039,000 as of March 31, 20009. Allen J. Campbell, vice president and CFO of Cooper-Standard, relates that as of the petition date, the Company had about $1,170,000,000 of outstanding indebtedness on a consolidated basis, of which $84.3 million consisted of draws on a senior secured revolving credit facility; $522.8 million consisted of five senior secured term loan facilities; $513.4 million consisted of unsecured senior and senior subordinated bond debt; and $49.9 million consisted of debt on account of other credit facilities, capital leases, swaps, and miscellaneous obligations. Cypress Group and Goldman Sachs Capital Partners Funds bought Cooper-Standard in 2004 for $1,165,000,000 in cash. To finance the acquisition, the Company accessed $125 million of revolving credit, and term loan facilities aggregating $350 million. The Company in February 2006 acquired the fluid handling businesses in North America, Europe and China from ITT Industries Inc. for approximately $202 million. The acquisition was funded with a notional amount of $215 million term loan. In August 31, 2007, the Company completed the acquisition of nine Metzeler Automotive Profile Systems sealing operations in Germany, Italy, Poland, Belarus, Belgium, and a joint venture interest in China from Automotive Sealing Systems S.A. The MAPS business were acquired for $144 million, mostly by using borrowings. Road to Bankruptcy According to Mr. Campell, "The current and unprecedented global economic crisis has had a crushing effect on the automotive industry and ultimately the Company's business." Automotive sales in the U.S. have declined significantly in 2008 and 2009. Since the majority of the Company's customers are OEMs and their suppliers, the Company has likewise experienced a significant fall off in sales, resulting in a decline in operating income and EBITDA. For the quarter ending March 31, 2009, the Company generated only $401.7 million in sales, compared with $756.0 million for the same period in 2008. About Cooper-Standard Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is a leading global automotive supplier specializing in the manufacture and marketing of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and NVH control systems. The Company is one of the leading suppliers of chassis products in North America, with about 14% of market share. The Company's main custoemrs include Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen, BMW, Fiat and Honda, among other automakers. Cooper-Standard Automotive employs approximately 16,000 people globally with more than 70 facilities throughout the world. For more information, visit the Company's Web site at: http://www.cooperstandard.com/ Cooper-Standard is a privately-held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard FrŠres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. COOPER-STANDARD: Case Summary & 30 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Cooper-Standard Holdings Inc. 39550 Orchard Hill Place Drive Novi, Michigan 48375 Bankruptcy Case No.: 09-12743 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Sterling Investments Company 09-12750 Cooper-Standard Automotive Inc. 09-12744 NISCO Holding Company 09-12751 Cooper-Standard Automotive FHS Inc. 09-12745 Cooper-Standard Automotive NC L.L.C. 09-12752 Cooper-Standard Automotive Fluid Systems Mexico Ho 09-12746 CS Automotive LLC 09-12753 StanTech, Inc. 09-12747 CSA Services Inc. 09-12754 Westborn Service Center, Inc. 09-12748 Cooper-Standard Automotive OH, LLC 09-12755 North American Rubber, Incorporated 09-12749 Type of Business: The Debtors make fluid handling, body sealing, and noise, vibration and harshness control components for passenger vehicles and light trucks. See http://www.cooperstandard.com/ Chapter 11 Petition Date: August 4, 2009 Court: District of Delaware Judge: Peter J. Walsh Debtor's Counsel: Gary L. Kaplan, Esq. Richard Slivinski, Esq. Peter B. Siroka, Esq. Fried, Frank, Harris, Shriver & Jacobson LLP One New York Plaza New York, NY 10004 Tel: (212) 859-8000 Fax: (212) 859-4000 http://www.ffhsj.com Debtors' Co-Counsel: Mark D. Collins, Esq. Michael J. Merchant, Esq. Chun I. Jang, Esq. Richards, Layton & Finger PA One Rodney Square 902 N. King Street Wilmington, DE 19801 Tel: (302) 651-7700 Fax: (302) 651-7701 http://www.rlf.com Debtors' Financial Advisor: Alvarez & Marsal 600 Lexington Avenue New York, NY 10022 http://www.alvarezandmarsal.com/ Debtors' Investment Banker: Lazard Freres & Co. 30 Rockfeler Place New York, NY 10020 http://www.lazard.com/ Debtors' Claims Agent: Kurtzman Carson Consultants LLC 2335 Alaska Avenue El Segundo, CA 90245 Tel: (866) 381-9100 http://www.kccllc.net/ The Debtors' financial condition as of March 31, 2009: Total Assets: $1,733,017,000 Total Debts: $1,785,039,000 The Debtors' Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wilmington Trust Company 8.375% Sr. Sub. $313,350,000 as Indenture Trustee notes due Dec. Rodney Square North 15, 2014 100 N. Market St. Wilmington, DE 19890 Tel: (302) 636-5410 Fax: (302) 636-4145 Wilmington Trust Company 7.000% Sr. Notes $313,350,000 as Indenture Trustee due Dec. 15, 2012 Rodney Square North 100 N. Market St. Wilmington, DE 19890 Tel: (302) 636-5410 Fax: (302) 636-4145 State of Ohio Environmenal consent $2,700,000 Protection Agency 1800 WaterMark Drive Columbus, Ohio 43266-0149 Tel: (614) 644-3020 Fax: (614) 644-2329 Robert Bosch LC trade vendor $713,782 38000 Hils Tech Drive Farmington Hils, MI 48331 Tel: (248) 876-1000 Fax: (876) 876-1116 Gil-Mar Manuacturing trade vendor $477,815 Summit Metals Services Inc. trade vendor $449,326 EMS-Chemie Na Inc. trade vendor $448,778 Evonik Degussa Corporation trade vendor $437,456 TMS Corporation trade vendor $395,668 Premier Too & Die Cast Corp. trade vendor $375,451 Kongsberg trade vendor $306,805 TI Group Automotive Systems trade vendor $259,315 Vitrica SA de CV trade vendor $259,312 Calvary Automation Systems trade vendor $248,191 Signature Aluminum Inc. trade vendor $247,428 Precix trade vendor $211,226 H&L Too Co. Inc trade vendor $202,485 Thunder Tooing & Mfg. Ltd. trade vendor $201,791 Vacuum Instrument Corporation trade vendor $192,780 USI Inc. trade vendor $183,096 GHSP trade vendor $183,101 Tubos Samaue De Mexico trade vendor $182,220 Papp Plastics trade vendor $179,316 Gonzalez Group LLC trade vendor $178,209 Titeflex Corporation trade vendor $176,633 Hi-Vo Products trade vendor $173,481 Apollo Metals trade vendor $166,390 Pension Benefit Guaranty Corp. trade vendor unknown Cooper Tire & Rubber trade vendor unknown Michigan Department of Gayford unknown Environmenta Quality groundwater contamination remediation The petition was signed by Allen J. Campbell, chief financial officer. COREL CORP: Hagerman Assumes CEO Post on Permanent Basis -------------------------------------------------------- Corel Corporation on July 29, 2009, said Kris Hagerman, who joined the Company as interim Chief Executive Officer in May 2008, will assume the role of Chief Executive Officer on a permanent basis, effective immediately. The Company also said the appointment of Joe Roberts as Executive Vice President, Products, on a permanent basis and the planned departure of Doug McCollam as Chief Financial Officer. The Company previously announced on May 5, 2008, that Mr. Hagerman had been appointed as interim Chief Executive Officer, and he has served in that capacity since May 8, 2008. Prior to his tenure with the Company, Mr. Hagerman, 45, served as a Senior Advisor at Vector Capital, an indirect holder of roughly 69% of Corel's outstanding common shares. From 2005 to 2007, Mr. Hagerman served as Senior Vice President of the Storage and Server Management Group of Symantec Corporation, a provider of infrastructure software, and then as Group President of Symantec's Data Center Management Group. Prior thereto, he served as Executive Vice President and General Manager of the Storage and Server Management Group for Veritas Software Corporation, a provider of storage management systems. From 2001 to 2004, Mr. Hagerman held executive positions with Veritas including Vice President of Alliances, Vice President of Strategic Operations, followed by Senior Vice President of Strategic Operations and Executive Vice President of Strategic Operations. Mr. Hagerman received his MBA from Stanford University. There are no arrangements between Mr. Hagerman and any other person pursuant to which Mr. Hagerman was selected as Chief Executive Officer, nor are there any transactions to which the Company was or is a participant and in which Mr. Hagerman has a material interest subject to disclosure under Item 404(a) of Regulation S-K. Mr. Hagerman has no family relationship with any director or executive officer which would otherwise be subject to disclosure. On July 28, 2009, the Company and Mr. Hagerman substantially finalized the terms on which Mr. Hagerman shall serve as the Chief Executive Officer of the Company effective as of July 28 and unless and until terminated by either party upon written notice. Mr. Hagerman will receive an annual base salary of $600,000 for the term of the agreement, subject to annual review and adjustment by the Board of Directors. Mr. Hagerman is also eligible to participate in the Company's Annual Incentive Plan with a target incentive of $400,000. The specific targets are set by the Board of Directors annually in consultation with Mr. Hagerman and reflect achievement of management objectives, corporate revenue and corporate EBITDA. In the event that Mr. Hagerman's employment by the Company is terminated without cause, he is entitled to severance compensation equal to 12 months' base salary plus a pro rata portion of the incentive compensation for the balance of the fiscal year (assuming 100% achievement), as well as 12 months' additional medical benefits coverage. If the Company completes a Significant Event -- as defined in the Company's 2006 Equity Incentive Plan -- then all of Mr. Hagerman's unvested options will be deemed to vest on completion of that event, provided that, if Mr. Hagerman departs the Company within 6 months after the Significant Event, he will be required to forfeit the accelerated options or any common shares or cash received in connection with those accelerated options. Mr. McCollam will be departing as Chief Financial Officer of the Company to take a career sabbatical, but will remain with the Company in that position until a permanent replacement is identified and to assist during a transition period. The Company is currently conducting a search for a replacement Chief Financial Officer. Mr. McCollam's employment agreement has recently been amended to provide that, in the event that his employment by the Company is terminated without cause and, if requested by the Company, he completes a 30 day transition period with the replacement Chief Financial Officer, then he is entitled to be paid (1) a pro rated portion of his AIP (assuming 50% achievement), (2) severance compensation equal to 12 months' base salary plus target incentive compensation (assuming 100% achievement), (3) 12 months' additional medical benefits coverage, and (4) in lieu of the remainder of his outstanding retention bonus, an amount equal to 30% of his base pay from July 1, 2009, until the completion of the 30 day transition period. Mr. Roberts is joining the Company on a permanent basis as Executive Vice President, Products. The Company previously announced on March 24, 2009, that Mr. Roberts had been hired as the Interim Executive Vice President, Products. "We are delighted that Kris is joining Corel as its permanent CEO," said Alex Slusky, Chairman of Corel's Board of Directors and Managing Partner at Vector Capital, the Company's majority shareholder. "Since joining the Company, Kris has been actively engaged in advancing all aspects of Corel's business strategy, while steering the Company through a very challenging economic cycle." "I'm excited about joining Corel on a permanent basis and by the opportunity to drive the future of the company with a longer-term outlook," said Mr. Hagerman. "In my time at Corel, I've been impressed by the quality and commitment of the team, and I'm excited about what Corel can accomplish in the years ahead as we look to leverage the many strengths of the company, including its vast customer base, the depth and breadth of its product portfolio, its reputation for innovation, quality, and value, and its global distribution channels." About Corel Corp. Corel Corp. (NASDAQ:CREL) (TSX:CRE) -- http://www.corel.com/-- is one of the world's top software companies with more than 100 million active users in over 75 countries. The Company provides high quality, affordable and easy-to-use Graphics and Productivity and Digital Media software. The Company's products are sold through a scalable distribution platform comprised of Original Equipment Manufacturers (OEMs), the Company's global e- Stores, and the Company's international network of resellers and retail vendors. The Company's product portfolio includes CorelDRAW(R) Graphics Suite, Corel(R) Paint Shop Pro(R) Photo, Corel(R) Painter(TM), VideoStudio(R), WinDVD(R), Corel(R) WordPerfect(R) Office and WinZip(R). The Company's global headquarters are in Ottawa, Canada, with major offices in the United States, United Kingdom, Germany, China, Taiwan, and Japan. Corel reported $217,990,000 in total assets and $230,109,000 in total liabilities, resulting in $12,119,000 of stockholders' deficit at May 31, 2009. Corel's working capital deficiency at May 31, 2009, was $13,200,000, an increase of $6,900,000 from the November 30, 2008, working capital deficiency of $6,300,000. * * * The Troubled Company Reporter reported on November 6, 2008, that Standard & Poor's Ratings Services affirmed its 'B' long-term corporate credit and senior secured debt ratings, on Ottawa-based packaged software provider Corel Corp. At the same time, S&P removed the ratings from CreditWatch with negative implications, where they were placed March 31, 2008. The outlook is stable. At August 31, Corel had US$159 million of debt outstanding. COYOTES HOCKEY: Glendale Can Keep Some Negotiation Files Private ---------------------------------------------------------------- Phoenix Business Journal reports that Maricopa County Superior Court Judge Edward Burke has ruled that most of the documents dealing with negotiations by the city of Glendale, Arizona, with the Phoenix Coyotes may remain sealed under a state law that allows nondisclosure in cases of legal negotiations. According to Business Journal, 34 of the 322 pages of the documents will have to be released as part of a lawsuit filed by the Goldwater Institute. As reported by the Troubled Company Reporter on July 10, 2009, the Goldwater Institute watchdog group was seeking to get a look at Glendale's negotiations with Jerry Reinsdorf regarding his bid for Phoenix Coyotes. Goldwater Institute wanted to see what Glendale had been talking to Mr. Reinsdorf about including any possible incentives, subsidies or lease changes. Glendale refused a public records request by Goldwater Institute, which then sued the city in June 2009, asking the court to make Glendale turn over the records. Glendale said that Goldwater Institute's request didn't fit into the state's public records law. Phoenix Coyotes owner Jerry Moyes' lawyers also asked the U.S. Bankruptcy Court for the District of Arizona to require more information on Mr. Reinsdorf's $148 million bid for the team. Mr. Moyes was also seeking information from Mr. Reinsdorf's business partners and the National Hockey League regarding the bid. Business Journal relates that Glendale fought attempts to release the documents because negotiations are ongoing. Judge Burke, Business Journal states, also ordered Glendale to release the documents as soon as a decision is made to bring a proposal to the City Council. Judge Burke, based on the city's ability to call a special meeting with 24 hours notice, sought to give Goldwater and any other interested parties more time to review the documents before a final decision was made, Business Journal reports. Dewey Ranch Hockey LLC, Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC -- owners and affiliates of the Phoenix Coyotes National Hockey League team -- filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 09-09488) on May 5, 2009. The Debtors are represented by Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, in Phoenix, and estimate their assets and liabilities are between $100 million and $500 million. Jim Balsillie, Research in Motion Ltd.'s co-chief executive officer, offered to buy the Phoenix Coyotes for $212 million and move the NHL team to Hamilton, Ontario, and the League balked at the relocation proposal. Mr. Balsillie was unsuccessful in 2007 when he attempted to buy and relocate the Nashville Predators, and lost a similar bid in 2006 to buy and relocate the Pittsburgh Penguins. COYOTES HOCKEY: Jerry Reinsdorf's Bid Gets NHL's Approval --------------------------------------------------------- Nancy Kercheval at Bloomberg News reports that the National Hockey League's board of governors unanimously approved Jerry Reinsdorf's $148 million bid for Phoenix Coyotes, and rejected Jim Balsillie's $212.5 million bid. NHL Commissioner Gary Bettman said in a statement, "We will so advise the Bankruptcy Court and we will move this process forward." According to Bloomberg, Mr. Balsillie's spokesperson Bill Walker said that based on bankruptcy Judge Redfield Baum's ruling in June 2009, the NHL can't keep Mr. Balsillie from taking ownership of Phoenix Coyotes unless it can prove there have been "material changes" in PSE since 2006, but "no such change was raised with us today [July 30]". Dewey Ranch Hockey LLC, Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC -- owners and affiliates of the Phoenix Coyotes National Hockey League team -- filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 09-09488) on May 5, 2009. The Debtors are represented by Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, in Phoenix, and estimate their assets and liabilities are between $100 million and $500 million. As widely reported, Jim Balsillie, Research in Motion Ltd.'s co- chief executive officer, offered to buy the Phoenix Coyotes for $212 million and move the NHL team to Hamilton, Ontario, and the League balked at the relocation proposal. Mr. Balsillie was unsuccessful in 2007 when he attempted to buy and relocate the Nashville Predators, and lost a similar bid in 2006 to buy and relocate the Pittsburgh Penguins. CRESCENT RESOURCES: U.S. Trustee Appoints 6 Members to Panel ------------------------------------------------------------ Pursuant to 11 U.S.C. Sec. 1102 (a) (1) and (b) (1), Charles F. McVay, united states trustee for Region 7, appointed these parties to the Committee of Unsecured Creditors in the Chapter 11 cases of Crescent Resources Inc. and its affiliates: 1. HCH (Rim Golf Investors L.L.C. and Chaparral Pines Investors LLC) c/o R. Perry Overstreet 3017 SE 156 Avenue Vancouver, WA.98683 Telephone: (928) 978-0662 E-mail: Rperryo@yahoo.com 2. Rim Chapparal Pines Real Estate Services, LLC (Portland Group LLC) c/o Lawrence M. Throneburg, III 3801 N. Goldwater Blvd., #400. Scottsdale, AZ 85251 Telephone: (928) 200-1385 Fax: (480) 284-7739 E-mail: lmt51@aol.com 3. Hofer Builders, Inc. (Crescent Bartram Park I, LLC ) c/o David Hofer 301 North Saginaw Blvd. Saginaw, Tex. 76179 Telephone: (817)232-2166 Fax: (817) 232-4886 E-mail: dhofer@hoferbuilders.com 4. Honors Golf (WGV, LLC) c\o Robert L. Shults, Jr. 3455 Peachtree Road NE, Suite 500 Atlanta, GA 30326 Telephone: (404) 261-8333 Fax: (404) 995-7001 E-mail: rob.shults@honoursgolf.com 5. WorldWest Limited Liability Company (Rim Golf Investors LLC) c\o Thomas Hornbaker 609 New Hampshire St. Lawrence, KS 66044 Telephone: (785) 832-7175 Fax: (785) 832-7120 E-mail: Thornbaker@ljworld.com 6. Gladys Elder (Crescent Resources, LLC) 412 San Lanta Circle Sanford, FL.32771 Telephone: (407) 322-3631 (407) 872-6222(Paul Byron, Esq) Fax: (407) 872-6822(Paul Byron) E-mail: geetutu@bellsouth.net(Elder) Paul@productts law.ne (Paul Byron) The Creditors Committee selected Robert L. "Rob" Shults, Jr., as chair. Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. Crescent Resources, LLC -- http://www.crescent-resources.com/-- is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Based in Charlotte, North Carolina, Crescent Resources is a joint venture between Duke Energy and the Morgan Stanley Real Estate Funds. Established in 1969, Crescent creates mixed-use developments, award-winning country club communities, single- family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Crescent Resources and 120 affiliates filed separate chapter 11 petitions on June 10, 2009 (Bankr. W.D. Tex. Lead Case No. 09- 11507). The Hon. Craig A. Gargotta presides over the case. Attorneys at Weil Gotshal Manges LLP represent the Debtors in their Chapter 11 cases. Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., serves as the Debtors' co-counsel. Garden City Group serves as claims and notice agent. The Debtors disclosed more than $1 billion each in assets and debts when they filed for bankruptcy. CRESCENT RESOURCES: Committee Retains Martine Winn as Counsel ------------------------------------------------------------- The Official Committee of Unsecured Creditors in Crescent Resources LLC's cases asks the U.S. Bankruptcy Court for the Western District of Texas, Austin Division, for permission to retain Martinec, Winn, Vickers & McElroy, PC., to represent it effective July 10, 2009. Martinec Winn's work will include providing advice and counsel to the Committee on matters relating to the bankruptcy case, litigation related to the case, pleadings, and reorganization and workout efforts. The hourly rates to be charged by the personnel of the firm who will be working on the case at this time are: Joseph D. Martinec $400 Rebecca S. McElron $400 Ed Winn $350 Lee Vickers $350 Paralegals $100 Law Clerks $35 Administration $20 The Committee believes that Martinec Winn has no interest adverse to the unsecured creditors on any matters upon which they are to be engaged. The firm may be reached at: Martinec, Winn, Vickers & McElroy, P.C. 600 Congress Avenue, Suite 500 Austin, TX 78701 Tel: (512) 476-0750 Fax: (512) 476-0753 E-mail: martine@mwvmlaw.com Crescent Resources, LLC -- http://www.crescent-resources.com/-- is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Based in Charlotte, North Carolina, Crescent Resources is a joint venture between Duke Energy and the Morgan Stanley Real Estate Funds. Established in 1969, Crescent creates mixed-use developments, award-winning country club communities, single- family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Crescent Resources and 120 affiliates filed separate chapter 11 petitions on June 10, 2009 (Bankr. W.D. Tex. Lead Case No. 09- 11507). The Hon. Craig A. Gargotta presides over the case. Attorneys at Weil Gotshal Manges LLP represent the Debtors in their Chapter 11 cases. Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., serves as the Debtors' co-counsel. Garden City Group serves as claims and notice agent. The Debtors disclosed more than $1 billion each in assets and debts when they filed for bankruptcy. CRESCENT RESOURCES: Top Executives Got $9.2MM Before Bankr. Filing ------------------------------------------------------------------ Court documents, according to CharlotteObserver.com, reveal that Crescent Resources LLC paid 17 top executives $9.2 million in the 12 months before the bankruptcy filing. The payments include more than $3 million in what appears to be bonuses. Crescent Resources paid on January 30, 2009, $3.6 million to 11 executives in lump sums ranging from $25,000 to $900,000. James Mozley and James Short -- presidents of Crescent Resources' residential and land-management divisions -- both received at least $1 million. Creditors may try to recover executive payments if they were made when the Company was insolvent, Elizabeth Gibson, a bankruptcy law professor at UNC Chapel Hill, said. As to plans by the creditors to recover those payments, Robert Shults, president of Honors Golf, a member of the official committee of unsecured creditors formed in the case, said, "We are interested in it, but we have just formed the committee [of unsecured creditors] and don't have an opinion on those payments." The Company lost $420 million last year. Crescent Resources, LLC -- http://www.crescent-resources.com/-- is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Based in Charlotte, North Carolina, Crescent Resources is a joint venture between Duke Energy and the Morgan Stanley Real Estate Funds. Established in 1969, Crescent creates mixed-use developments, award-winning country club communities, single- family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Crescent Resources and 120 affiliates filed separate chapter 11 petitions on June 10, 2009 (Bankr. W.D. Tex. Lead Case No. 09- 11507). The Hon. Craig A. Gargotta presides over the case. Attorneys at Weil Gotshal Manges LLP represent the Debtors in their Chapter 11 cases. Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., serves as the Debtors' co-counsel. Garden City Group serves as claims and notice agent. The Debtors disclosed more than $1 billion each in assets and debts when they filed for bankruptcy. CRISMON CAPITAL: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Crismon Capital Group, LLC 7208 East Cave Creek Road, Suite A Carefree, AZ 85377 Case No.: 09-18108 Chapter 11 Petition Date: July 30, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Randolph J. Haines Debtor's Counsel: Daniel E. Garrison, Esq. Law Offices of Daniel E Garrison PLLC 7114 E Stetson Drive, Suite 300 Scottsdale, AZ 85251 Tel: (480) 421-9449 Fax: (480) 522-1515 Email: dan@andantelaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. D & L SALES: Case Summary & 10 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: D & L Sales, LLC 1930 Bobby Lee Point Sanford, FL 32771 Bankruptcy Case No.: 09-11273 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Middle District of Florida (Orlando) Debtor's Counsel: Peter N. Hill, Esq. Wolff Hill McFarlin & Herron PA 1851 West Colonial Drive Orlando, FL 32804 Tel: (407) 648-0058 Fax: (407) 648-0681 Email: phill@whmh.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 10 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-11273.pdf The petition was signed by Lon J. Neuville, managing member of the Company. DBSI INC: Interim Report on Fraud Probe to Be Released Today ------------------------------------------------------------ Idaho Business Review says that the U.S. Bankruptcy Court for the District of Delaware would release on August 4 an interim report on the investigation into DBSI Inc.'s inter-company transactions and transfers. Court-appointed investigators found earlier this year evidence that money from new DBSI investors was used to pay financial obligations to those who had previously bought into the Company. According to IBR, the state of Idaho also accused DBSI of engaging in a Ponzi scheme. DBSI schemed to defraud thousands of investors out of millions of dollars through the sale of unregistered securities, IBR says, citing the state. IBR relates that Joshua Hochberg, who was appointed to conduct an examination, said that he intended to make an interim report to the U.S. Bankruptcy Judge Peter Walsh on August 4. Headquartered in Meridian, Idaho, DBSI Inc. and its affiliates were engaged in numerous commercial real estate and non-real estate projects and businesses. On November 10, 2008, and other subsequent dates, DBSI and 180 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-12687). Lawyers at Young Conaway Stargatt & Taylor LLP represent the Debtors as counsel. The Official Committee of Unsecured Creditors tapped Greenberg Traurig, LLP, as its bankruptcy counsel. Kurtzman Carson Consultants LLC is the Debtors' notice claims and balloting agent. When the Debtors filed for protection from their creditors, they listed assets and debts between $100 million and $500 million. Joshua Hochberg, a former head of the Justice Department fraud unit, has been named examiner to investigate allegations of fraud by the Debtors and their management. DELTA AIR LINES: Air New Zealand Opposes Delta-Virgin Tie Up ------------------------------------------------------------ Virgin Blue Airlines Group's plan to form a joint venture with Delta to expand both carriers' reach between the U.S. and Australia and the South Pacific, is being opposed by Air New Zealand, citing "collusion on fares and capacity," according to The Dominion Post. Air New Zealand offers indirect services between Australia and Los Angeles via Auckland. It filed its formal opposition after Singapore Airlines-backed Tiger Airways said that it would object to the proposed Delta-Virgin Blue venture, says the report. To recall, Delta and Virgin Blue announced on July 8, 2009, that they will seek regulatory approval for their proposed revenue- sharing agreement which will allow them to collaborate on route and product planning, enforce code-sharing on each of their networks, extend frequent flyer program benefits, and lounge access to customers. John Blair, Air New Zealand's general counsel found the proposed joint venture "anti-competitive." He added that in 2008, the Australian Competition and Consumer Commission had rejected plans for a "co-operation agreement" between Air New Zealand and Air Canada on a Sydney-Vancouver route, which, according to Mr. Blair, would lead to the unlikely success of the Delta-Virgin Blue application, the Post reports. About Delta Air Lines With its acquisition of Northwest Airlines, Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- is now the world's largest airline. From its hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Salt Lake City and Tokyo-Narita, Delta, its Northwest subsidiary and Delta Connection carriers offer service to more than 376 destinations worldwide in 66 countries and serves more than 170 million passengers each year. Delta's marketing alliances allow customers to earn and redeem either SkyMiles or WorldPerks on more than 16,000 daily flights offered by SkyTeam and other partners. The merger closed on October 29, 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington, represented the Northwest Debtors in their restructuring efforts. On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Northwest Airlines Bankruptcy News and Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported by the TCR on June 29, 2009, Fitch Ratings has downgraded the debt ratings of Delta Air Lines, Inc., and its wholly owned subsidiary Northwest Airlines, Inc. -- (i) DAL's Issuer Default Rating to 'B-' from 'B', First-lien senior secured credit facilities to 'BB-/RR1' from 'BB/RR1', and Second-lien secured credit facility to 'B-/RR4' from 'B/RR4', and (ii) NWA's IDR to 'B-' from 'B'; and Secured bank credit facility to 'BB- /RR1' from 'BB/RR1'. The downgrade of DAL's ratings reflects the continued erosion of the airline's near-term cash flow generation potential that has resulted from extremely weak business travel demand and large year-over-year declines in passenger revenue per available seat mile. DELTA AIR LINES: Bastian Disposed Of 20,000 Delta Shares July 28 ---------------------------------------------------------------- Edward H. Bastian, president and chief operating officer of Northwest Airlines Corporation, informed the Securities and Exchange Commission on July 29, 2009, that he disposed of 20,000 shares of Delta Air Lines, Inc., common stock at a price of $6.53 per share on July 28. Following the transaction, Mr. Bastian is deemed to beneficially own 652,719 shares of Delta common stock. About Delta Air Lines With its acquisition of Northwest Airlines, Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- is now the world's largest airline. From its hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Salt Lake City and Tokyo-Narita, Delta, its Northwest subsidiary and Delta Connection carriers offer service to more than 376 destinations worldwide in 66 countries and serves more than 170 million passengers each year. Delta's marketing alliances allow customers to earn and redeem either SkyMiles or WorldPerks on more than 16,000 daily flights offered by SkyTeam and other partners. The merger closed on October 29, 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington, represented the Northwest Debtors in their restructuring efforts. On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Northwest Airlines Bankruptcy News and Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported by the TCR on June 29, 2009, Fitch Ratings has downgraded the debt ratings of Delta Air Lines, Inc., and its wholly owned subsidiary Northwest Airlines, Inc. -- (i) DAL's Issuer Default Rating to 'B-' from 'B', First-lien senior secured credit facilities to 'BB-/RR1' from 'BB/RR1', and Second-lien secured credit facility to 'B-/RR4' from 'B/RR4', and (ii) NWA's IDR to 'B-' from 'B'; and Secured bank credit facility to 'BB- /RR1' from 'BB/RR1'. The downgrade of DAL's ratings reflects the continued erosion of the airline's near-term cash flow generation potential that has resulted from extremely weak business travel demand and large year-over-year declines in passenger revenue per available seat mile. DELTA AIR LINES: Techops and Hawaiian Air Have Support Pact ----------------------------------------------------------- Delta Air Lines' (NYSE: DAL) maintenance division, Delta TechOps, has entered into a memorandum of understanding (MOU) with Honolulu-based Hawaiian Airlines. The long-term agreement, which could be valued at as much as $500 million, includes Delta TechOps' Complete Fleet (TM) support for Hawaiian's new Airbus 330-200 fleet and an extension of an existing support agreement for Hawaiian's Boeing 767 fleet. The Complete Fleet services contract will cover line maintenance, component maintenance services, inventory provisioning and support, maintenance planning and scheduling, engineering support, contractor management and other technical services for Hawaiian's Airbus 330-200 fleet, with deliveries beginning in April 2010. "We're thrilled to expand on our longtime partnership with Hawaiian Airlines and honored that they will be the launch customer of Delta TechOps' A330 capabilities," said Tony Charaf, president of Delta TechOps. "The strong partnership we have with Hawaiian and our other maintenance, repair and overhaul customers is the direct result of the men and women in Delta's Technical Operations. Their hard work, expertise and flexibility are what make Delta TechOps unique." The A330, which is just one component of Hawaiian's growth strategy, serves as the airline's next generation of long-range aircraft, allowing Hawaiian to expand its product and service. "Delta has been an excellent partner in our 767 operations and we are delighted they've put forward the most competitive bid for our A330 program," said Charlie Nardello, Hawaiian senior vice president of Operations. "Delta's extensive network and the expertise of their former NWA technical staff with Airbus give us confidence that our induction of the A330 into Hawaiian's fleet will be seamless." About Hawaiian Airlines Hawaiian is the nation's highest-ranked carrier for service quality and performance in 2008 in the 19th annual Airline Quality Rating study. Hawaiian has also led all U.S. carriers in on-time performance for each of the past five years (2004-2008) and has been an industry leader in fewest misplaced bags during that same period (No. 1 from 2005-2007, No. 2 in 2008) as reported by the U.S. Department of Transportation. Consumer surveys by Conde Nast Traveler, Travel + Leisure and Zagat have all ranked Hawaiian as the top domestic airline serving Hawaii. Now in its 80th year of continuous service in Hawaii, Hawaiian is the state's biggest and longest-serving airline, as well as the largest provider of passenger air service to Hawaii from the state's primary visitor markets on the U.S. mainland. Hawaiian offers nonstop service to Hawaii from more U.S. gateway cities (10) than any other airline, as well as service to the Philippines, Australia, American Samoa, and Tahiti. Hawaiian also provides more than 160 daily jet flights within the Hawaiian Islands. Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA). Additional information is available at: http://www.HawaiianAirlines.com/ About Delta TechOps Delta TechOps is the largest airline maintenance, repair and overhaul provider in North America, generating more than $500 million in revenue in 2008. In addition to providing maintenance and engineering support for Delta's fleet of more than 750 aircraft, Delta TechOps serves more than 150 other aviation and airline customers around the world, specializing in high-skill work like engines, components, hangar and line maintenance. Delta TechOps employs more than 8,500 maintenance professionals and is one of the world's most experienced providers, with more than seven decades of aviation expertise. More about Delta TechOps is available at http://www.deltatechops.com/ About Delta Air Lines With its acquisition of Northwest Airlines, Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- is now the world's largest airline. From its hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Salt Lake City and Tokyo-Narita, Delta, its Northwest subsidiary and Delta Connection carriers offer service to more than 376 destinations worldwide in 66 countries and serves more than 170 million passengers each year. Delta's marketing alliances allow customers to earn and redeem either SkyMiles or WorldPerks on more than 16,000 daily flights offered by SkyTeam and other partners. The merger closed on October 29, 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington, represented the Northwest Debtors in their restructuring efforts. On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. (Bankruptcy Creditors Service Inc. publishes Northwest Airlines Bankruptcy News and Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported by the TCR on June 29, 2009, Fitch Ratings has downgraded the debt ratings of Delta Air Lines, Inc., and its wholly owned subsidiary Northwest Airlines, Inc. -- (i) DAL's Issuer Default Rating to 'B-' from 'B', First-lien senior secured credit facilities to 'BB-/RR1' from 'BB/RR1', and Second-lien secured credit facility to 'B-/RR4' from 'B/RR4', and (ii) NWA's IDR to 'B-' from 'B'; and Secured bank credit facility to 'BB- /RR1' from 'BB/RR1'. The downgrade of DAL's ratings reflects the continued erosion of the airline's near-term cash flow generation potential that has resulted from extremely weak business travel demand and large year-over-year declines in passenger revenue per available seat mile. DETROIT PUBLIC SCHOOLS: Bankruptcy is Worst Option, Union Says -------------------------------------------------------------- A bankruptcy filing is the worst option for Detroit Public Schools, Marisa Schultz at The Detroit News reports, citing Keith Johnson, president of the Detroit Federation of Teachers, one of the 10 unions and 16 bargaining units negotiating with the district. Citing experts, The Detroit News relates that Detroit Public is facing a $259 million deficit and diminishing cost-cutting options. As reported by the Troubled Company Reporter on July 15, 2009, Detroit Public, which has experienced budget deficits for seven years, may consider filing for bankruptcy protection to sell off assets and cut costs. Mr. Wasko said that Robert C. Bobb, who Michigan Governor Jennifer Granholm appointed in January as emergency financial manager for Detroit Public, recommended bankruptcy as an option for addressing deficit. Bloomberg states that the district has $1.6 billion of debt, which might be reorganized or restructured in bankruptcy. Mr. Wasko said that school officials met with retired bankruptcy judge Ray Reynolds Graves and other attorneys to discuss whether Chapter 9 bankruptcy, which is for government entities, would be good for the district. Retired U.S. Bankruptcy Judge Ray Reynolds Graves said that Chapter 9 could let the district discard its labor agreements, The Detroit News states. The report quoted Mr. Graves as saying, "The bond obligations and the labor contracts are the big financial burdens on DPS. Failure of the constituents to make sacrifices will make Chapter 9 inevitable. If people don't want to make deals, then (the district will) have to file." According to The Detroit News, Ms. Johnson said, "Filing bankruptcy sends the wrong message to the community. It says, 'We are broke and we can't afford to educate your children.' That will be the perception, whether real or imagined. That would accelerate the exodus of Detroit Public Schools." A Chapter 9 bankruptcy filing may be an attractive option due to the ease it could offer in throwing out union contracts, but it should only be used as a last resort, The Detroit News states, citing James E. Spiotto, a Chapter 9 specialist and partner with Chapman and Cutler LLP in Chicago. Detroit Public Schools is a school district that covers all of the city of Detroit, Michigan, United States. The district had 194 schools as of 2008. DHP HOLDINGS: Hires Landis Rath as Special Litigation Counsel ------------------------------------------------------------- DHP Holdings II Corporation and its affiliates ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Landis Rath & Cobb LLP as special litigation counsel, nunc pro tunc to June 2, 2009, to pursue certain collection actions on outstanding accounts receivable. William E. Chipman, Jr., a partner at Landis Rath, says that the firm does not hold or represent any interest adverse to the Debtors or their estates with respect to the collection matters for which LRC is to be employed. The current hourly rates of the principal attorneys and paralegals who will have primary responsibility for this engagement are: William E. Chipman, Jr., Esq. $500 Rebecca L. Butchcer, Esq. $375 Mark D. Olivere, Esq. $340 Linda Rogers About DHP Holdings Headquartered in Bowling Green, Kentucky, DHP Holdings II Corporation is the parent of DESA Heating, which sells and distributes heating commercial products in Europe and Mexico under brand names including ReddyHeater, Comfort Glow and Master Portable Heaters. The Company has manufacturing, storage and distribution facilities in Alabama and California. DHP Holdings II and six of its affiliates filed for Chapter 11 protection on December 29, 2008 (Bankr. D. Del. Lead Case No. 08-13422). The Company's international arm, HIG-DHP Barbados, has not filed for bankruptcy. HIG-DHP Barbados holds 100% of the equity of all foreign nondebtor subsidiaries, which manufacture, distribute and sell commercial and consumer goods in Europe, Mexico, and Canada. Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski, Stang, Ziehl Young & Jones LLP, serves as counsel to the Debtors. The Debtors have engaged AEG Partners as restructuring consultants, with the firm's Craig S. Dean serving as chief restructuring officer and Kevin Willis as assistant chief restructuring officer. Epiq Bankruptcy Solutions LLC is the noticing, claims and balloting agent. As of November 29, 2008, the Company, along with its non-debtor units and affiliates, had assets of $132.5 million and liabilities of $133.2 million. DONALD WOLSEY BARRETT: Case Summary & 20 Largest Unsec. Creditors ----------------------------------------------------------------- Joint Debtors: Donald Wolsey Barrett aka Don Barrett Vicky Lou Barrett 44 Seabrook Landing Drive Hilton Head Island, SC 29926 Bankruptcy Case No.: 09-05696 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: David R. Duncan Debtors' Counsel: Michael W. Mogil, Esq. 303 Professional Building Hilton Head Island, SC 29928 Tel: (843) 785-8110 Fax: (843) 785-9676 Email: mwmogil@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A full-text copy of the Debtors' petition, including a list of their 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/scb09-05696.pdf The petition was signed by the Joint Debtors. DUANE READE: Posts $11.6 Million Net Loss for Q2 2009 ----------------------------------------------------- Duane Reade Holdings, Inc., reported financial results for the second quarter ended June 27, 2009. Net retail store sales, which exclude pharmacy resale activity, increased 4.2% to $450.3 million from $432.1 million in the second quarter of 2008. Total net sales increased 6.1% to $479.1 million from $451.4 million in the second quarter of 2008. Total same-store sales increased by 1.7% during the second quarter of 2009, with a front-end same-store sales increase of 0.2% and a pharmacy same-store sales increase of 3.6%. During the second quarter, the Company opened three new stores and closed two stores. At the end of the second quarter, the Company operated 253 stores, compared to 251 stores at December 27, 2008 and 241 stores at the end of the second quarter of 2008. Total front-end sales increased by 3.3%, primarily due to the opening of new stores, as the difficult economy, reduced levels of tourism and poor weather patterns combined to restrain same-store sales growth. The shift in Easter holiday sales into the second quarter of 2009 from the first quarter of 2008 positively impacted front-end same-store sales in 2009 by approximately 0.6%. In addition, the front-end same-store sales reflect an increase in cigarette prices commensurate with a June 2008 increase in New York State cigarette excise taxes. Although such additional sales did not result in any additional profit to the Company, the increase in sales price positively impacted front-end same-store sales by approximately 0.6%. The pharmacy same-store sales growth reflected continued strength in this portion of the business as the average same-store weekly prescriptions filled per store increased 2.6% during the second quarter of 2009. Generic drugs, which typically sell at lower prices but yield higher margins and profitability than brand-name drugs, represented approximately 61.9% of pharmacy prescriptions for the second quarter, compared to approximately 58.7% of pharmacy prescriptions in the second quarter of 2008. The higher proportion of generics adversely impacted pharmacy same-store sales growth by 3.7% during the second quarter of 2009. Product margin, which represents net sales less cost of sales (excluding depreciation and amortization), for the second quarter was 30.4% of total net sales, compared to 30.9% during the second quarter of 2008. Product margin on retail sales, which excludes pharmacy resale activity, increased to 32.4% of net retail store sales from 32.3% in the prior year. Selling, general and administrative expenses as a percentage of net sales decreased to 25.5% from 26.3% in the previous year, primarily due to increased pharmacy resale activity. Selling, general and administrative expenses as a percentage of net retail store sales decreased to 27.2% from 27.4% in the previous year and reflect cost savings resulting from initiatives implemented by the Company and designed to mitigate the impact of the current economic conditions. Second quarter 2009 Adjusted FIFO EBITDA increased 6.3% to $26.5 million, compared to $24.9 million in the prior year period. As a percentage of net retail store sales, Adjusted FIFO EBITDA increased to 5.9% compared to 5.8% in the previous year. Second quarter 2009 operating income was $1.2 million, compared to an operating loss of $200,000 in the prior year period. The improvement was primarily due to the increase in Adjusted FIFO EBITDA of $1.6 million. In addition, during the second quarter of 2009, other expenses increased $1.6 million to $4.9 million. The increase in other expenses was due to increased closed store costs and additional expenses relating to litigation activities associated with a former CEO. The net loss for the second quarter of 2009 was $11.6 million, compared to $12.1 million in the prior year period. The improvement is attributable to the increase in operating income and was partially offset by an increase in interest expense of $900,000 during the second quarter of 2009, compared to the prior year. The increase in interest expense was due to a non-cash fair value adjustment for the preferred stock's mandatory redemption feature, which is considered a derivative financial instrument. During the second quarter of 2009, cash interest paid by the Company decreased by $1.2 million due to lower interest rates on the Company's variable rate borrowings and lower outstanding borrowings on the revolving credit facility. The Company's net cash provided by operating activities was $26.7 million compared to $26.8 million in the prior year second quarter. At quarter end, the Company's total debt, including capital leases but excluding the liability associated with the issuance of the redeemable preferred stock, was $554.5 million, reflecting a decrease of $1.1 million from the balance at the end of fiscal 2008. Availability under the Company's revolving credit facility at quarter end was approximately $67.5 million. For the six month period, total net sales were $923.6 million, reflecting an increase of 5.1% compared to $878.5 million last year. Net retail store sales increased 3.5% to $877.0 million, from $847.0 million in the prior year period. Total same-store sales increased 1.4%, with a front-end same-store sales decrease of 0.3% and a pharmacy same-store sales increase of 3.6%. Product margin decreased to 30.7% of total net sales for the six month period, compared to 31.0% in the prior year, due to increased pharmacy resale activity. As a percentage of net retail store sales, product margin improved to 32.3% from 32.1% in the prior year with the increase attributable to improved front-end selling margins and reduced front-end shrink losses. Selling, general and administrative expenses as a percentage of net sales decreased to 26.5% from 26.9% in the prior year period. As a percentage of net retail store sales, selling, general and administrative expenses were 27.9% for both periods. Adjusted FIFO EBITDA increased by 6.9% to $46.2 million, or 5.3% of net retail store sales, from $43.2 million, or 5.1% of net retail store sales, in the prior year period. Operating loss was $3.2 million in the first half of 2009, compared with $4.3 million in the first half of 2008, primarily attributable to the improvement in Adjusted FIFO EBITDA, and was partially offset by a $2.1 million increase in other expenses from $4.1 million in the first half of 2008 to $6.3 million in the first half of 2009. The increase in other expenses during the first half of 2009 is primarily due to additional expenses relating to litigation activities associated with a former CEO and additional closed store costs. The net loss for the first six months of 2009 was $28.8 million, compared to $33.1 million in the prior year period. The improvement is attributable to the reduction in operating loss and reduced interest expense of $3.1 million during the first six months of 2009. The reduction in interest expense was primarily due to lower interest rates on the Company's variable rate borrowings as compared to the prior year. The Company generated net cash flows from operating activities of $31.0 million during the first half of 2009 compared to $26.8 million in first half of 2008. At June 27, 2009, the Company had $701.6 million in total assets and $876.9 million in total liabilities, resulting in $175.3 million in stockholders' deficit. At March 28, 2009, the Company had $708,637,000 in total assets and $872,340,000 in total liabilities, resulting in $163,703,000 stockholders' deficit. Company Outlook With respect to the remainder of 2009, the Company: -- Reaffirmed its previously provided expectations for the fiscal year's Adjusted FIFO EBITDA in the range of $93 million to $98 million. -- Adjusted its expectations for net retail store sales to a range of $1.760 billion to $1.785 billion from its previously anticipated range of $1.795 billion to $1.830 billion, primarily attributable to the timing of new store openings and the difficult economic environment which has led to reduced levels of tourism and consumer spending. -- Adjusted its expected annual total same-store sales growth range to 0.5% to 2.2% from its previously anticipated range of 1.0% to 2.6%, with front-end same-store sales growth now expected to range from (1.0%) to 1.0% and pharmacy same-store sales growth expected to fall within the previously anticipated range of 2.0% to 3.5%. -- Adjusted its anticipated range of net loss to $50.5 million to $55.5 million from its previously anticipated range of $47.0 million to $52.0 million, due primarily to increased closed store costs included within other expenses. John A. Lederer, Chairman and Chief Executive Officer, commented, "We are encouraged by our continued solid performance despite a weak external environment and are also pleased with our 6.3% increase in Adjusted FIFO EBITDA. We made significant progress on the transformation of our business during the quarter and continue to be pleased with the very strong performance of our new and transformed store locations. The customer response to our improved offering and store design remains exceedingly positive with an expanding level of awareness of the improvements we have made. We are encouraged by this momentum and remain committed to better serving New Yorkers as we aim to become a destination brand." Mr. Lederer concluded, "As we look to the second half of the year, we remain cautiously optimistic about our prospects for continued growth in our business and remain on track with our expectations for Adjusted FIFO EBITDA, even as we take into account continued external challenges. We are pleased with Oak Hill's demonstrated confidence in our transformation plans and appreciate the firm's ongoing support as our equity partner. Further, we anticipate that our debt refinancing will be completed shortly and look forward to the benefits of operating our business with added financial flexibility as we continue to identify and pragmatically realize our opportunities for long-term growth." A full-text copy of Duane Reade's Earnings Release Excerpts is available at no charge at http://ResearchArchives.com/t/s?409e About Duane Reade Founded in 1960, Duane Reade is the largest drug store chain in New York City, offering a wide variety of prescription and over- the-counter drugs, health and beauty care items, cosmetics, convenience foods, greeting cards and photofinishing. As of June 27, 2009, the Company operated 253 stores. DUANE READE: Unveils Pricing of 11.75% Sr. Sec. Notes Offering -------------------------------------------------------------- Duane Reade Holdings, Inc., said Friday its wholly owned subsidiaries, Duane Reade Inc. and Duane Reade, had priced their offering of $300,000,000 aggregate principal amount of Senior Secured Notes due August 1, 2015. The Notes will bear interest at an annual rate of 11.75%. The Notes were priced at 97.417%, representing a yield to maturity of 12.375%. The offering of the Notes is expected to close on August 7, 2009. The Issuers intend to use the net proceeds from the Notes offering, together with a portion of the proceeds from a $125 million preferred equity investment by entities associated with Oak Hill Capital Partners, L.P., to purchase the Issuers' $210,000,000 aggregate principal amount of Senior Secured Floating Rate Notes due 2010 and up to $146,250,000 aggregate principal amount of 9.75% Senior Subordinated Notes due 2011 and pay any related consent fees in the Issuers' cash tender offer for such securities or to optionally redeem any Floating Rate Notes not tendered in the Offers pursuant to an optional redemption notice to be given at the closing date of the offering of the Notes. The closing of the Notes offering is conditioned upon, among other things, (i) all conditions precedent -- including, without limitation, the funding of the Equity Investment -- to the Offers, other than the availability of the proceeds of the notes offering, being satisfied or waived and (ii) receipt of an amendment to the Issuers' asset-based revolving loan facility to permit, among other things, the completion of the Offers and the Notes offering. The offer and sale of the Notes will not be registered under the Securities Act of 1933 and may not be offered or sold in the United States absent such registration or an exemption from the registration requirements of such Act. The Troubled Company Reporter said July 17 that Moody's Investors Service assigned a Caa1 rating to Duane Reade's proposed new $210 million senior secured notes and a Caa3 rating to its proposed new $110 million senior subordinated notes. Moody's also affirmed Duane Reade's Caa1 Corporate Family Rating and Ca Probability of Default Rating. The rating outlook is stable. Proceeds from the issuance of the notes will be used to fund the company's cash tender offer for its outstanding $210 million senior secured and $195 million senior subordinated notes. Duane Reade's Caa1 CFR reflects the company's high leverage and weak coverage along with its geographic concentration in and disproportionate exposure to economic conditions in the intensely competitive New York metro market. The rating also incorporates Moody's expectation that free cash flow will be weak over the next twelve months due to relatively modest cash flow that is largely consumed by capital expenditures. About Duane Reade Founded in 1960, Duane Reade is the largest drug store chain in New York City, offering a wide variety of prescription and over- the-counter drugs, health and beauty care items, cosmetics, convenience foods, greeting cards and photofinishing. As of June 27, 2009, the Company operated 253 stores. ELECTROGLAS INC: Can Hire Pepper Hamilton as Bankruptcy Counsel --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Electroglas Inc. and Electroglas International Inc. to employ Pepper Hamilton LLP as their counsel. The firm is expected to, among other things: a) represent the Debtors in all aspects of the Chapter 11 proceedings; b) advise the Debtors with respect to their rights, powers and duties as debtor and debtor-in-possession in the continued management and operation of the businesses and properties; c) attend meetings and negotiate with representatives of creditors and other parties-in-interest; d) advise and consult the Debtors regarding the conduct of the case including all of the legal administrative requirements of operating in Chapter 11; and e) advise the Debtors on matters relating to the evaluation of the assumption, rejection or assignment of unexpired leases and executory contracts. The firm's standard hourly rates are: Designation Hourly Rate ----------- ----------- Partners and Counsel $380 to $825 Associates $240 to $435 Paraprofessionals $75 to $215 The Debtors assured the Court that the firm does not hold any interests adverse to their estate and creditors, and is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in San Jose, California, Electroglas Inc. operates a semiconductor manufacturing machinery. The Company and its affiliate, Electroglas International Inc., filed for Chapter 11 protection on July 9, 2009 (Bankr. D. Del. Lead Case No. 09- 12416). When the Debtors sought for protection from their creditors, they listed $19,625,000 in total assets and $31,542,000 in total debts. ELECTROGLAS INC: U.S. Trustee Appoints Three to Creditors' Panel ---------------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, has appointed three members to the official committee of unsecured creditors in the Chapter 11 cases of Electroglas Inc. and Electroglas International Inc. The Creditors Committee members are: 1. NPI Solutions, Inc. Attn: Kevin Anderson 721 Charcot Ave. San Jose, CA 95131 Tel: (408) 944-9178 Fax: (408) 944-9644 2. U-Freight America, Inc. Attn: Richard Keller 320 Corey Way South San Francisco, CA 94080 Tel: (650) 583-6527 Fax: (650) 583-8122 3. Execuforce LLC Attn: Ryan Gilmore 99 Almaden Blvd., No. 975 San Jose, CA 95113 Tel: (408) 283-9244 Fax: (408) 283-9111 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About Electroglas Inc. Headquartered in San Jose, California, Electroglas Inc. operates a semiconductor manufacturing machinery. The Company and its affiliate, Electroglas International Inc., filed for Chapter 11 protecton on July 9, 2009 (Bankr. D. Del. Lead Case No. 09-12416). When the Debtors sought for protection from their creditors, they listed $19,625,000 in total assets and $31,542,000 in total debts. ELEMENT ALUMINUM: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Element Aluminum, LLC 2410 Dr. F.E. Wright Drive Jackson, TN 38305 Case No.: 09-13091 Type of Business: The Debtor operates an Aluminum Fabricator business. Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Western District of Tennessee (Jackson) Judge: G. Harvey Boswell Debtor's Counsel: E. Franklin Childress Jr., Esq. Baker Donelson Bearman & Caldwell, PA 165 Madison Avenue, 20th Fl. Memphis, TN 38103 577-2147 Email: fchildress@bakerdonelson.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Thomas M. Ostrom, the company's manager. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hazelett Stripcasting Casting m/c supplies $826,685 Corp. PO Box 600 135 West Lakeshore Colchester, VT 05446 Unique Machine Repair, Inc. Press repairs $130,583 Link Tool & Manufacturing Tooling $118,368 American Express Various Credit $59,066 Card Purchases Volunteer Machine & Tool Machine shop $55,345 LLC services PSK Steel Corp. Hot Mill Rolls $50,000 turned Dead Sea Magnesium LTD Alloying material $43,863 Aleastur of America LLC Alloying materials $34,673 Lewis Supply Company General Supplies $26, 874 C.H. Robinson Worldwide, Freight services $23,775 Inc. Airgas Plant gases $22,913 Laurand Associates Inc. Alloying materials $19,149 Fedex Freight Freight Services $19,037 GE Fanuc Electronic Field $14,584 Service Industrial Automation Automation $13,500 Services Field Service FGMK, LLC Audit/tax $13,150 Pyrotek, Inc. Casting supplies $12,614 Core Trans LLC Freight Services $12,486 Jackson Industrial Sales General Supplies $12,280 The J&J Company Machine Shop $12,142 Services ELLIS BROWN: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Ellis Brown dba Quantum General Contractors aka James Ellis Brown 3229 Monterey Blvd. Oakland, CA 94602 Bankruptcy Case No.: 09-47036 Chapter 11 Petition Date: August 1, 2009 Court: United States Bankruptcy Court Northern District of California (Oakland) Judge: Randall J. Newsome Debtor's Counsel: Coraltha O. Lewis, Esq. Law Offices of Cora O. Lewis 5032 Woodminster Lane Oakland, CA 94611 Tel: (510) 482-3088 Email: lewis-cora@sbcglobal.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/canb09-47036.pdf The petition was signed by Ellis Brown. ELLSRAY CAPITAL LLC: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Debtor: Ellsray Capital, LLC 7208 East Cave Creek Road, Suite A Carefree, AZ 85377 Case No.: 09-18107 Chapter 11 Petition Date: July 30, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Eileen W. Hollowell Debtor's Counsel: Daniel E. Garrison, Esq. Law Offices of Daniel E Garrison PLLC 7114 E Stetson Drive, Suite 300 Scottsdale, AZ 85251 Tel: (480) 421-9449 Fax: (480) 522-1515 Email: dan@andantelaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. ENERGY PARTNERS: Court Confirms Plan; In Talks for Exit Financing ----------------------------------------------------------------- Energy Partners, Ltd., said the United States Bankruptcy Court for the Southern District of Texas, Houston Division, confirmed EPL's pre-negotiated Joint Plan of Reorganization. "The Court's confirmation of Energy Partners' Plan is a major milestone in what has been a very efficient and productive restructuring process," said Alan D. Bell, Chief Restructuring Officer. "Our operations are strong and we look forward to emerging from this process with a much improved capital structure. I speak for the Board and management team when I offer sincere thanks to our employees, customers, vendors and other stakeholders for their support and confidence in our company throughout this process." Under the terms of the plan of reorganization, the holders of the Company' senior notes will receive their pro rata share of 95% of the outstanding common stock in the reorganized Company upon its emergence from bankruptcy, and the current stockholders in the Company will receive the remaining 5%, in each case prior to any issuance of shares or options under customary employee incentive arrangements. EPL is in discussions with lenders regarding the terms of an exit facility that the Company will enter into upon the effective date of the Plan. The closing of the exit facility is one of the conditions to the effectiveness of the Plan and the Company's emergence from bankruptcy. The confirmation order provides that the conditions to the effectiveness of the Plan must be satisfied by September 10, 2009, or a later date agreed to by the Company and the Noteholders or as set by the Court. About Energy Partners Ltd. Based in New Orleans, Louisiana, Energy Partners, Ltd., (Pink Sheets: ERPL.PK) is an independent oil and natural gas exploration and production company. The Company had interests in 24 producing fields, six fields under development and one property on which drilling operations were then being conducted, all of which are located in the Gulf of Mexico Region. Energy Partners, Ltd., and its affiliates filed for Chapter 11 on May 1, 2009 (Bankr. S.D. Tex. Lead Case No. 09-32957). Paul E. Heath, Esq., at Vinson & Elkins LLP, represents the Debtors in their restructuring efforts. The Debtors propose to employ Parkman Whaling LLC as financial advisor. The Debtors' financial condition as of December 31, 2008, showed total assets of $770,445,000 and total debts of $708,370,000. ERNIE HAIRE: Accepting Bids for Assets Until August 14 ------------------------------------------------------ According to Tampa Business Journal, bids for Ernie Harie Ford Inc.'s Ford dealership in Tampa, Florida, and other assets are being accepted until August 14. Elder Automotive Group, which owns a Tampa Jaguar dealership, is the stalking horse bidder with its $8 million offer. Elder Automotive will receive a $150,000 break-up fee if Ernie Harie consummates a sale with another party. In case competing bids are timely received, an auction will be conducted on August 17, otherwise, the Debtor is expected to seek approval of the sale to Elder without an auction. The sale may or may not include the Florida Avenue property, where the new car dealership is headquartered and which is owned by the Mary Haire trust, Business Journal says, citing Herbert Donica, Ernie Haire's bankruptcy counsel. Mr. Donica said that several investors have conveyed interest in Ernie Harie's assets. A winning bidder that wants to continue to operate the dealership must secure Ford Motor Co.'s approval. Headquartered in Tampa, Florida, Ernie Haire Ford, Inc. -- http://ernie-haireford.dealerconnection.com-- has been a Ford dealer for about 38 years. The Company also sells used and new automobiles. The Company filed for Chapter 11 protection on November 24, 2008 (Bankr. M.D. Fla. Case No. 08-18672). Attorneys at G. T. Hodges, P.A., represent the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed assets and debts between $10 million to $50 million each. F.D. WILSON TRUCKING: Case Summary & 20 Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: F.D. Wilson Trucking Company, Inc. PO Box 5330 Vernon, AL 35592 Bankruptcy Case No.: 09-71938 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Northern District Of Alabama (Tuscaloosa) Judge: C. Michael Stilson Debtor's Counsel: Justin G. Williams, Esq. Tanner & Guin LLC PO Box 3206 Tuscaloosa, AL 35403-3206 Tel: (205) 633-0218 Fax: (205) 633-0318 Email: jwilliams@tannerguin.com Robert L. Shields III, Esq. Tanner & Guin, LLC 418 Lorna Square Office Complex Birmingham, AL 35216 Tel: (205) 823-1990 Fax: (205) 278-8595 Email: rls@bhamlawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/alnb09-71938.pdf The petition was signed by F.D. Wilson, president of the Company. FAIRPOINT COMMUNICATIONS: Fitch Cuts Issuer Default Rating to 'RD' ------------------------------------------------------------------ Fitch Ratings has downgraded FairPoint Communications, Inc.: -- Issuer Default Rating to 'RD' from 'C'. Fitch's downgrade reflects the company's July 30, 2009 announcement of the successful consummation of a private exchange offer of approximately $458 million of 13.25% senior notes due April 2, 2018 (New Notes) for approximately $440 million, or approximately 83%, of its 13.125% senior notes due April 1, 2018 (Old Notes), of which there was approximately $531.1 million outstanding. In Fitch's view, the exchange has elements of a coercive debt exchange under Fitch's policy. Under the policy, the IDR is being downgraded to 'RD' before the rating is raised to reflect the company's prospects. Subsequently, Fitch has taken these actions: -- IDR upgraded to 'C' from 'RD'; -- 13.125% senior unsecured notes due April 2, 2018 (New Notes) rated 'C/RR4'; -- 13.125% senior unsecured notes due April 1, 2018 (Old Notes) affirmed at 'C/RR4'; -- Senior secured revolving credit facility affirmed at 'B- /RR1'; -- Senior secured term loan due 2014 affirmed at 'B-/RR1'; -- Senior secured term loan due 2015 affirmed at 'B-/RR1'; -- Senior secured delayed draw term loan due 2015 affirmed at 'B-/RR1'. FairPoint's 'C' IDR reflects continued uncertainty regarding the company's near-term prospects. FairPoint had previously disclosed in the May 2009 release of its first quarter 2009 earnings that the weak economy, difficulties related to its systems cutover, and incremental costs to operate the business following cutover may jeopardize its ability to execute on its business plan. On March 31, 2009, FairPoint's cash balance amounted to approximately $92.5 million, and its restricted cash balance was $55.2 million. The cash balance includes proceeds drawn from FairPoint's $170 million credit facility to preserve capital availability; $4.7 million remains available. FairPoint has no major maturities in 2009, although Fitch estimates approximately $33 million will be due under the amortization of its credit facility during the remainder of the year. The revolving credit facility and term loan A mature in March 2014. FAIRPOINT COMMUNICATIONS: S&P Cuts Corporate Credit Rating to 'SD' ------------------------------------------------------------------ Standard & Poor's Ratings Services said it lowered its corporate credit rating on Charlotte, North Carolina-based FairPoint Communications Inc. to 'SD' from 'CC' and lowered the unsecured debt rating to 'D' from 'C'. At the same time, S&P removed the ratings from CreditWatch with negative implications, where they had been placed on June 25, 2009, following the company's announcement of its exchange offer, which S&P has determined is a distressed exchange. The 'CC' senior secured bank loan rating remains on CreditWatch Negative. "We expect to reassign a corporate credit rating of 'CC', given the very limited liquidity being experienced by the company since the cutover from the Verizon systems due to operational issues," said Standard & Poor's credit analyst Catherine Cosentino, "as well as the uncertain prospects for near-term payment of interest and loan amortization, and uncertain ability to meet existing covenants in the credit facility over the coming quarters." S&P is also likely to reassign a 'C' to the 17% of the old notes that did not participate in the exchange offer. Their recovery will continue to be a '6', representing negligible (0%-10%) recovery in the event of a payment default. FINLAY ENTERPRISES: May Have Bids in Advance of Possible Filing --------------------------------------------------------------- Finlay Enterprises Inc. received two bids in advance of a potential bankruptcy filing, Bloomberg's Carla Main reported, citing two people familiar with the situation. According to the report, Versa Capital Management Inc., a Philadelphia-based private-equity firm, and a group of liquidators submitted offers to buy the New York-based company out of bankruptcy. A bankruptcy filing may come as soon as next week, the same people said, according to Bloomberg. Finlay Fine Jewelry Corporation, Finlay Enterprises, Inc.'s wholly owned subsidiary, failed to make a semi-annual interest payment of $1.7 million that was due on June 1, 2009, to the holders of Finlay Jewelry's 8-3/8% Senior Notes due June 1, 2012. The indenture governing the Senior Notes provides for a 30-day grace period for the payment of interest. Finlay Jewelry also did not make the interest payment during the 30-day grace period, which ended on July 1, 2009. Finlay Jewelry's failure to make the interest payment by July 1, 2009, constitutes an event of default under the indenture governing the Senior Notes. Under the terms of the indenture governing the Senior Notes, as a result of the event of default, the trustee under the indenture or the holders of at least 25% of the Senior Notes may by written notice declare the Senior Notes immediately due and payable. About Finlay Enterprises Finlay Enterprises, Inc. (OTC Bulletin Board: FNLY) through its wholly owned subsidiary, Finlay Fine Jewelry Corporation, is one of the leading retailers of fine jewelry operating luxury stand- alone specialty jewelry stores and licensed fine jewelry departments in department stores throughout the United States and achieved sales of $754.3 million in fiscal 2008. The number of locations at the end of the first quarter of fiscal 2009 totaled 476, including 68 Bailey Banks & Biddle, 34 Carlyle and five Congress specialty jewelry stores. Going Concern Doubt According to Finlay, its ability to continue as a going concern is dependent on the successful implementation of its strategic plan, the repayment of the amounts due under its revolving credit facility and its ability to obtain a new line of credit on or before the maturity date of the Revolving Credit Agreement. In addition, Finlay experienced a significant operating loss in 2008, it incurred an operating loss in the first quarter of 2009, and it is expected to incur operating losses for the remainder of 2009. "These uncertainties raise substantial doubt about our ability to continue as a going concern," Finlay says. On March 22, 2009, Finlay completed the sale of certain assets to Bloomingdale's. The assets included inventory and fixed assets for the 34 departments that it operated in Bloomingdale's for a purchase price of roughly $33.4 million. The proceeds from the transaction were used to pay-down a portion of the outstanding balance under Finlay Jewelry's Revolving Credit Facility. Finlay reported total assets of $430,023,000 and total liabilities of $451,679,000, resulting in $21,656,000 in shareholders' deficit as of May 2, 2009. It posted a net loss of $28,669,000 on sales of $159,321,000 for the 13 weeks ended May 2, 2009, compared to a net loss of $11,011,000 on sales of $142,072,000 for the 13 weeks ended May 3, 2009. FIRSTBANK PUERTO: Moody's Reviews Ba1 Deposit Rating ---------------------------------------------------- Moody's Investors Service placed the bank financial strength and long term debt and deposit ratings of FirstBank Puerto Rico (bank financial strength D+, long-term deposits Ba1) on review for possible downgrade. FirstBank is the primary operating subsidiary of First BanCorp Puerto Rico, which is unrated. The review will focus on the possible further deterioration in FirstBank's loan portfolio. Continued deterioration in the bank's Puerto Rico portfolio would further challenge financial flexibility which is already severely pressured by FirstBank's Florida commercial real estate exposure where losses are at the high end of Moody's expectations. The rating action follows First BanCorp's second quarter earnings release where it reported a net loss of $78.7 million, driven by a provision for loan losses of $235 million, and announced the suspension of common and preferred dividends. The heightened provision was primarily due to the continued market downturn in South Florida and Puerto Rico. Moody's last rating action on FirstBank was on March 6, 2009, when the issuer rating was downgraded to Ba2. Issuer: FirstBank Puerto Rico On Review for Possible Downgrade: -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently D+ -- Issuer Rating, Placed on Review for Possible Downgrade, currently Ba2 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently Ba2 -- Senior Unsecured Bank Note Program, Placed on Review for Possible Downgrade, currently Ba2 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently Ba2 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Ba1 Outlook Actions: -- Outlook, Changed To Rating Under Review From Stable FLORIDA YACHT: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Florida Yacht Charters and Sales, Inc. 390 Alton Road #3 Miami Beach, FL 33139 Bankruptcy Case No.: 09-25920 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Southern District of Florida (Miami) Judge: A. Jay Cristol Debtor's Counsel: James A. Poe, Esq. 9500 S Dadeland Blvd, Suite 610 Miami, FL 33156 Tel: (305) 670-3950 Fax: (305) 670-3951 Email: jamesapoe@bellsouth.net Total Assets: $3,641,265 Total Debts: $3,411,217 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flsb09-25920.pdf The petition was signed by David P. Sell, president of the Company. FORTICELL BIOSCIENCE: Wants Court to Dismiss Chapter 11 Case ------------------------------------------------------------ Forticell BioScience asks the U.S. Bankruptcy Court to enter an order dismissing its Chapter 11 case, BankruptcyData.com reports. The Debtor said that Holy Land Art has failed to comply with an agreement to provide debtor-in-possession financing. The Bankruptcy Court order imposed a June 12, 2009, deadline for providing such financing, but Holy Land continues to be in breach of that order. The Debtor has been unable to obtain alternative financing. Forticell is facing foreclosure from Columbia University, which houses the Company's New York lab and office facilities. "The absence of such funding voided the bankruptcy court order. Given the sudden unexpected loss of DIP financing and exposure to imminent eviction, we gave no assurance regarding the continuation of our operations. We endeavored to find alternative financing. Our bankruptcy attorney was assessing our potential claims for damages against HLA and any other parties that may have caused the breach or made misrepresentations regarding, among other things, HLA's ability to provide financing necessary for us to continue our operations," BankruptcyData.com quoted the Debtor as saying. Based in New York, Forticell Bioscience Inc. -- http://www.forticellbioscience.com/-- engages on regenerative medicine and stem cell therapy. The Company filed for Chapter 11 protection on November 21, 2008 (Bankr. S.D.N.Y. Case No. 08- 14665). Randy M. Kornfeld, Esq., at Kornfeld & Associates, P.C., represents the Debtor in its restructuring efforts. When it sought for protection from its creditors, the Debtor posted assets between $1 million and $10 milion. FONTAINEBLEAU: Committee Retains Fox Rothschild as Co-Counsel ------------------------------------------------------------- The Official Committee of Unsecured Creditors in Fontainebleau Las Vegas LLC's case seeks the Bankruptcy Court's authority to retain Michael J. Viscount, Jr., Esq., and his law firm, Fox Rothschild LLP, as co-counsel to the Committee, nunc pro tunc to June 22, 2009. As co-counsel to the Committee, Fox is expected to: (a) advise the Committee with respect to its rights, powers, and duties in the Chapter 11 cases; (b) assist and advise the Committee in its consultations with the Debtors relative to the administration of the Cases; (c) assist the Committee in analyzing the claims of the Debtors' creditors and in negotiating with the creditors; (d) assist with the Committee's investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtors and of the operation of the Debtors' business; (e) assist the Committee in its analysis of, and negotiations with, the Debtors or any third party concerning matters related to the use of cash collateral, debtor-in- possession financing, the liquidation of assets and the terms of a plan or plans of reorganization; (t) assist and advise the Committee with respect to its communications with the general creditor body regarding significant matters in the Cases; (g) represent the Committee at all hearings and other proceedings in the Cases; (h) review and analyze all applications, motions, orders, statements of operations, and schedules filed with the Court and advise the Committee as to their propriety; (i) assist the Committee in preparing pleadings and applications as may be necessary in furtherance of the Committee's interests and objectives; and (g) perform other legal services as may be required and are deemed to be in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code. In exchange for its services, Fox will be paid based on its hourly rates: Professional Hourly Rate ------------ ----------- Michael J. Viscount, Jr. $540 Josefina Fernandez McEvoy $600 Josh Klein $335 Kelly M. Cooper $220 Attorneys $220 - $675 Associate Attorneys $220 - $450 Legal Assistants $50 - $265 The Debtors will pay Fox's fees and reimburse its expenses incurred after the filing of interim or a final application and a hearing consistent with the requirements of Sections 327, 330 and 331 of the Bankruptcy Code, Rules 2002, 2016 of the Federal Rules of Bankruptcy Procedure and Local Rules 2016-1. Michael J. Viscount, Jr., Esq., an attorney and shareholder at Rothschild LLP, relates that Fox does not have any connections with the Debtors, their creditors, or any other party-in- interest, or their attorneys and accountants, or the United States Trustee or any person employed in the office of the U.S. Trustee, except HSH NordBank. Prior to the Petition Date, Mr. Vicount relates, one or more of the Debtors filed a law suit in Nevada against various of the Debtors' lenders including HSH Nor Bank. Fox was retained and served as local Nevada counsel to Kaye Scholer LLP on behalf of HSH. The representation of HSH in that matter was directed by Kaye Scholer. Fox had no direct contact with HSH, received no confidential information from HSH concerning the matter, and the services provided were limited to filing of pleadings in the Federal Court located in Las Vegas, Mr. Viscount relates. The only lawyers at Fox involved were three located in the firm's Las Vegas office and one attorney in Philadelphia who secured the representation, he adds. The law suit was dismissed by the Debtors prior to the Petition Date at which time the involvement of Fox ceased with respect to the claims of the Debtors against HSH. In addition to the Debtors' lawsuit, HSH was also sued in Nevada by other lender parties in connection with extensions of credit to the Debtors. Fox was in the process of finalizing the terms of the same local counsel representation for Kaye Scholer in the Lender's Action until the relationship was terminated by Kaye Scholer. Out of an abundance of caution, Fox has set up an ethical screen around the four lawyers who provided local counsel services in Nevada. The four lawyers will have no role whatsoever in the representation of the Committee in the Cases, and no member of the firm's Financial Services and Bankruptcy Department will have any access to the firm's files of HSH, Mr. Viscount informs the Court. Against this backdrop, Mr. Viscount assures the Court that his firm does not hold any interest adverse to the Debtors and is a "disinterested person" within the scope and meaning of Section 101(14) of the Bankruptcy Code. Debtors' Objection The Debtors have objected to the Application, arguing that while achieving a meaningful recovery for unsecured creditors in the Chapter 11 cases may prove to be herculean task, that does not justify the retention of multiple law firms as co-counsel to the Committee. In response, the Committee asserts that the Debtors' action is a continuation of an ongoing and orchestrated effort to subvert the federal bankruptcy process by the Debtors working together with some or all of their senior lenders and the Sofer family, which owns and controls the Debtors as well as certain non-debtor affiliates. The Committee relates that to reserve to themselves the benefits of the bankruptcy process, and at the expense of others whom Congress has sought to protect, the Debtors have put forth an incredible position expressed by themselves and others with whom they speak in confidence, designed to alter the balance of power in a bankruptcy case and frustrate the clear intentions of Congress under the Bankruptcy Code. The Committee argues that the Court should not allow the frustration of the process of the Bankruptcy Code as suggested by the Debtors and, if nothing else, should rule that the Committee be permitted to employ counsel of its choice, especially since no one in the Case is prepared to voluntarily provide even a nominal sum of money from which the Committee's professionals can be paid. About Fontainebleau Las Vegas Fontainebleau Las Vegas Holdings, LLC -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleau Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas, LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Judge A. Jay Cristol presides over the Debtors' cases. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represents the Debtors in their restructuring efforts. The Debtors' Financial Advisor are Moelis & Company LLC and Citadel Derivatives Group LLC. The Debtors' Special Litigation Counsel is David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors' Claims Agent is Kurtzman Carson Consulting LLC. An official committee of unsecured creditors has been appointed in the Chapter 11 cases. As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FONTAINEBLEAU: Committee Retains Genovese as Co-Counsel ------------------------------------------------------- The Official Committee of Unsecured Creditors in Fontainebleau Las Vegas LLC's bankruptcy case asks the Bankruptcy Court to enter order authorizing it to employ Paul J. Battista, Esq. and the law firm of Genovese, Joblove & Battista, P.A., as co-counsel to the Committee, nunc pro tunc to June 22, 2009, the date services were first rendered. Genovese will be required to render, among others, these services to the Committee: (a) advise the Committee with respect to its rights, powers, and duties in the Chapter 11 cases; (b) assist and advise the Committee in its consultations with the Debtors relative to the administration of the Cases; (c) assist the Committee in analyzing the claims of the Debtors' creditors and in negotiating with the creditors; (d) assist with the Committee's investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtors and of the operation of the Debtors' business; (e) assist the Committee in its analysis of, and negotiations with, the Debtors or any third party concerning matters related to the use of cash collateral, debtor-in- possession financing, the liquidation of assets and the terms of a plan or plans of reorganization; (t) assist and advise the Committee with respect to its communications with the general creditor body regarding significant matters in these Cases; (g) represent the Committee at all hearings and other proceedings in the cases; (h) review and analyze all applications, motions, orders, statements of operations, and schedules filed with the Court and advise the Committee as to their propriety; (i) assist the Committee in preparing pleadings and applications as may be necessary in furtherance of the Committee's interests and objectives; and (j) perform other legal services as may be required and are deemed to be in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code. The Firm will be paid based on its hourly rates: Professional Hourly Rate ------------ ----------- Paul J. Battista $525 Glenn D. Moses $435 Heather L. Harmon $330 Attorney $160 - $650 Associate Attorneys $160 - $350 Legal Assistants $85 - $160 The Debtors will pay Fox's fees and reimburse its expenses after the filing of interim or final fee application and a hearing consistent with the requirements of Sections 327, 330 and 331 of the Bankruptcy Code, Rules 2002 and 2016 of the Federal Rules of Bankruptcy Procedure and Local Rules 2016-1. Paul J. Battista, Esq., an attorney and shareholder of Genovese Joblove & Battista, P.A., assures the Court that his firm neither holds nor represents any interest adverse to the Debtors and is a "disinterested person" within the scope and meaning of Section 101(14) of the Bankruptcy Code. A search of GJB's conflicts check system and the responses from attorneys at GJB revealed certain connections with the Cases, none of which, according to Mr. Batista, impairs GJB's disinterestedness or constitutes any conflict of interest. A list of these connections is available for free at http://bankrupt.com/misc/FB_GJBRepresentations.pdf Debtors' Objection The Debtors point out that the Debtors are also seeking the Court's approval to retain Fox Rothschild LLP as co-counsel. The Debtors assert that the retention of two firms as co-counsel is unnecessary and will unduly burden the estate with excessive administrative expenses that may complicate its efforts to confirm a plan of reorganization. Either of the Committee's chosen counsel are capable of single-handedly representing the Committee, the Debtors maintain. The Committee counters that the Debtors' objection is both "disingenuous and offensive" in that it is brought by what is effectively a single party who finds nothing strange about employing in their Chapter 11 cases no less than six law firms, two accounting firms, a financial advisor, an investment banker and a noticing agent, who collectively were paid over $4.7 million for services provided during the lead up to bankruptcy and who apparently have managed to burn through over $3 million of retainer money brought into the Case. About Fontainebleau Las Vegas Fontainebleau Las Vegas Holdings, LLC -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleau Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas, LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Judge A. Jay Cristol presides over the Debtors' cases. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represents the Debtors in their restructuring efforts. The Debtors' Financial Advisor are Moelis & Company LLC and Citadel Derivatives Group LLC. The Debtors' Special Litigation Counsel is David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors' Claims Agent is Kurtzman Carson Consulting LLC. An official committee of unsecured creditors has been appointed in the Chapter 11 cases. As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FONTAINEBLEAU: Proposes to Reject 33 Employment And Sales Pacts --------------------------------------------------------------- Pursuant to Section 365(a) of the Bankruptcy Code, Fontainebleau Las Vegas, LLC and its affiliates ask the Bankruptcy Court to issue an order authorizing the rejection of 11 employment contracts of its former employees, and 21 group sales executory contracts. A list of the Contracts to be rejected is available for free at: http://bankrupt.com/misc/FB_Reject_11EC.pdf http://bankrupt.com/misc/FB_Reject_21GSC.pdf Due to Fontainebleau Las Vegas's financial situation, each of the employees was terminated as of the term date and is no longer employed by Fontainebleau Las Vegas. Accordingly, to limit any potential administrative obligations associated with the Employment Contracts during the Chapter 11 Cases, the Debtors seek authority for Fontainebleau Las Vegas to reject the Employment Contracts. Each employee had entered into an Employment Contract with Fontainebleau Las Vegas prepetition. The Group Sales Contracts relate to certain conventions that are scheduled to occur at the Project on or before June 2010. With the construction on hold at the present time, the Project will not be completed by the scheduled convention date for each Group Sales Contract which Fontainebleau Las Vegas seeks to reject. Therefore, the request is necessary because Fontainebleau Las Vegas is no longer in a position to fulfill the obligations set forth in the Group Sales Contracts in the timeframe required by each contract. Given the realities of the Debtors' circumstances, the Debtors seek rejection of the Contracts, as they are of little or no value, and are burdensome to the estates. About Fontainebleau Las Vegas Fontainebleau Las Vegas Holdings, LLC -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleau Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas, LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Judge A. Jay Cristol presides over the Debtors' cases. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represents the Debtors in their restructuring efforts. The Debtors' Financial Advisor are Moelis & Company LLC and Citadel Derivatives Group LLC. The Debtors' Special Litigation Counsel is David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors' Claims Agent is Kurtzman Carson Consulting LLC. An official committee of unsecured creditors has been appointed in the Chapter 11 cases. As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FONTAINEBLEAU: Proposes to Reject Town Square Lease --------------------------------------------------- Fontainebleau Las Vegas, LLC, and its affiliates seek the Bankruptcy Court's permission to to reject a Town Square Lease with Turnberry/Centra Sub, LLC, as of July 10, 2009. On January 30, 2008, the Landlord and Fontainebleau Las Vegas, as Tenant, entered into a Lease Agreement, as amended, for the lease of 6623 Las Vegas Boulevard South, Suite No. 300, Las Vegas, Nevada. Pursuant to the terms of the Town Square Lease, Fontainebleau Las Vegas is obligated to make monthly rental payments of $53,023 on the first of each month for the first 12 months, with monthly payments increasing annually by approximately $2,300 per month. The Town Square Lease is scheduled to expire on April 30, 2014. As of July 16, 2009, the Debtors have never occupied nor improved the Rental Space and have not tendered rent or the security deposit contemplated by the Town Square Lease. On July 10, 2009, Fontainebleau Las Vegas gave formal written notification of its intent to reject the Town Square Lease. Fontainebleau Las Vegas says it no longer intends to use the Rental Space as it is not necessary for an effective reorganization of the Debtors' estates. About Fontainebleau Las Vegas Fontainebleau Las Vegas Holdings, LLC -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleau Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas, LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Judge A. Jay Cristol presides over the Debtors' cases. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represents the Debtors in their restructuring efforts. The Debtors' Financial Advisor are Moelis & Company LLC and Citadel Derivatives Group LLC. The Debtors' Special Litigation Counsel is David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors' Claims Agent is Kurtzman Carson Consulting LLC. An official committee of unsecured creditors has been appointed in the Chapter 11 cases. As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FONTAINEBLEAU: Sued by Turnberry West to Assert Liens ----------------------------------------------------- Turnberry West Construction, Inc., delivered to the Court on July 14, 2009, a complaint against: (a) Fontainebleau Las Vegas LLC, as owner and developer, (b) Bank of America N.A as Administrative Agent, Issuing Lender, and Swing Line Lender, (c) Term Lenders, See: http://bankrupt.com/misc/FB_TermLenders.pdf (d) Revolving Lenders, * N.A., Merrill Lynch Capital Corporation, * JPMorgan Chase Bank, N.A., * Barclays Bank PLC, * Deutsche Bank Trust Company Americas, * The Royal Bank of Scotland PLC, * Sumitomo Mitsui Banking Corporation, * Bank of Scotland, * HSN Nordbank AG, * MB Financial Bank, N.A., and * Camulos Master Fund, L.P. (e) Second Mortgage Lenders, See: http://bankrupt.com/misc/FB_2ndMortgageLenders.pdf (f) John Does 1-50 representing any unknown successor lender under either a Term Loan, Delayed Draw Loan or Swing Line Loan. James D. Gassenheimer, Esq., at Berger Singerman, in Miami, Florida, relates that TWC did not wish to bring the lawsuit at this time. TWC attempted to persuade the Term Lenders to not require the filing of the Adversary as a condition precedent to its consent to the Debtors' use of Cash Collateral. Mr. Gassenheimer notes that TWC does not wish to destabilize the Debtors' case and believes that the issues raised in the complaint could have been more efficiently and effectively resolved later and at a less fragile time in the case. However, TWC failed to persuade the Term Lenders to eliminate the requirement that the complaint be filed on or before July 14, 2009. Mr. Gassenheimer recounts that TWC entered into a construction contract with FBLV for the construction of Fontainebleau Las Vegas. Pursuant to the Construction Contract, TWC is entitled to a fee of $62,431,561 and a soft cost fee of $1,466,899 for the construction of the Project. After application of all payments received by TWC from FBLV as of May 31, 2009, TWC claims a lien of $675,260,792, plus interest at a rate of 15%, as provided for under the Construction Contract, in respect of accrued and unpaid draws. Certain Lenders and the Debtors closed loans to fund the continued construction of the Project on June 6, 2007. As part of the June 6 Loans, the Lenders required disclosure of all material contracts. Mr. Gassenheimer says that TWC continued to employ subcontractors with workers and materialmen and proceeded with the scope of work provided for under the Construction Contract. However, as a direct result of the Debtors' inability to obtain access to the promised funds, TWC was not paid and was unable to pay its subcontractors. Consequently, on June 4, 2009, TWC filed and recorded a claim of lien in the public records of Clark County Nevada bearing Doc Number 2009060400011772, in accordance with Nevada law, for $668,990,933. The vast majority of the amount is for money owed to various subcontractors who have performed work for which they have not been paid because TWC, in turn, has not been paid by FBLV because its funding has been cut off. TWC has received demand for payment from many of its subcontractors and in many instances has been sued. Certain Lenders caused TWC and certain related companies along with the Debtors to enter into an "Affiliate Subordination Agreement" in favor of BOA, as Administrative Agent and Wells Fargo, as Trustee. At the same time, the Debtors and their related entities closed on the June 6 Loans. The Subordination Agreement states that TWC will not obtain any Lien on any assets of the Fontainebleau Companies. The Agreement further states that if a lien exists it will be subordinate to the Senior Debt. According to Mr. Gassenheimer, TWC brought this Adversary Proceeding for: (i) a declaration that the Subordination Agreement is void and unenforceable under applicable law, and (ii) to determine the validity, priority and extent of TWC's lien on its own behalf and on behalf of all construction lien holders claiming by and through the lien of TWC, finding that the Term Lenders, Swing Line Lenders, Revolving Lenders and 2nd Mortgage Lenders liens are inferior to that of TWC in the full amount of its claim. The Court has summoned the Debtors and the Prepetition Lenders and required them to file an answer to the complaint on or before August 8, 2009, except that the United States and its offices and agencies will submit an answer to the complaint on or before August 19, 2009. The Court will hold a pre-trial conference on the Action on October 19, 2009, at 10:00 a.m., in Claude Pepper Federal Bldg, 51 SW First Ave Room 1410, in Miami, Florida. About Fontainebleau Las Vegas Fontainebleau Las Vegas Holdings, LLC -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleau Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas, LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Judge A. Jay Cristol presides over the Debtors' cases. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represents the Debtors in their restructuring efforts. The Debtors' Financial Advisor are Moelis & Company LLC and Citadel Derivatives Group LLC. The Debtors' Special Litigation Counsel is David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors' Claims Agent is Kurtzman Carson Consulting LLC. An official committee of unsecured creditors has been appointed in the Chapter 11 cases. As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FOOTHILLS RESOURCES: Court Declines to Approve Employee Bonuses --------------------------------------------------------------- Judge Christopher Sontchi of the U.S. Bankruptcy Court for the District of Delaware declined to authorize Foothills Resources Inc. to make bonus payments under certain employment agreements. The payments may not be made because the two executives are insiders and the bonuses are for the purpose of retention, not incentive, and are therefore disallowed under the Bankruptcy Code, Judge Sontchi wrote, according to Carla Main at Bloomberg News. The recipients to the proposed bonuses include two persons who are vice presidents of the Debtors. Foothills Resources, Inc., is engaged in the acquisition, exploration and development of oil and natural gas properties. The company's operations are conducted primarily through its wholly owned subsidiaries, Foothills California, Inc., Foothills Texas, Inc., and Foothills Oklahoma, Inc. On February 11, 2009, Foothills Resources and its wholly owned subsidiaries, Foothills California, Foothills Oklahoma, and Foothills Texas, filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 09-10452). Judge Christopher S. Sontchi handles the Chapter 11 cases. Akin Gump Strauss Hauer & Feld LLP is the Debtors' lead bankruptcy counsel. Norman L. Pernick, Esq., and Patrick J. Reilley, Esq., at Cole, Schotz, Meisel, Forman & Leonard, represent the Debtors as Delaware counsel. The Garden City Group, Inc., is the claims agent for the Debtors. In its bankruptcy petition, Foothills listed assets and debts of between $50 million and $100 million each FORD MOTOR: Reports First Auto Sales Increase in 2009 ----------------------------------------------------- Customer demand for Ford Motor Co.'s fuel-efficient vehicles coupled with the U.S. government's Car Allowance Rebate System ("Cash for Clunkers") enabled the Company to post the first sales increase of any major manufacturer in 2009. Ford, Lincoln, and Mercury dealers reported 118,197 retail sales in July, up 9% versus a year ago. Total sales (including fleet customer deliveries) were 158,838, up 2% versus last year. "We had another strong month in progress before the 'Cash for Clunkers' program started," said Ken Czubay, Ford vice president, U.S. Marketing, Sales and Service. "Our products, our dealers and our advance preparation enabled us to leverage the program and drive traffic and sales to another level. In addition, we achieved a sales increase even though we decreased incentive spending in an increasingly competitive environment." July Sales Highlights -- Ford Fusion sales totaled 17,610, a July record and up 66% versus a year ago, and Mercury Milan sales were up 60%. The 2010 model Fusion and Milan and their hybrid versions are the most fuel-efficient mid-size sedans in America. -- Ford Escape sales totaled 20,241, a July record and up 94% versus a year ago, and Mercury Mariner sales were up 71%. The 2009 model Escape Hybrid and Mariner Hybrid are the most fuel-efficient utility vehicles in America. -- Ford Focus sales totaled 21,830, up 44% versus a year ago. The Focus is among the most fuel-efficient compact cars in America with an EPA highway rating of 35 mpg. -- Ford Ranger sales totaled 7,695, up 65% versus a year ago. The Ranger is the most fuel-efficient compact pickup in America. -- Ford Flex sales totaled 3,631, up 65% versus a year ago. The Flex is among the most fuel-efficient mid-size crossover utilities in America. -- Ford's hybrid vehicles (Fusion, Milan, Escape and Mariner) posted combined sales of 5,353, a record for any month and up 323% versus a year ago. "We have the freshest line of new products in the industry," said Mr. Czubay. "We're really encouraged by the growing number of consumers who are considering Ford for their next vehicle." Internal and external studies show a positive trend in the%age of consumers with favorable opinions about Ford, and growing numbers of consumers who are willing to consider purchasing a Ford vehicle, thanks to improved fuel economy, smart technology and higher residual values. More new products are on the way. The first new 2010 Ford Taurus sedans were delivered at the end of July, as well as the first Transit Connects. The all-new Taurus is the smartest full-size sedan in America. The Transit Connect, a small, fuel-efficient purpose-built van, is the first ONE Ford global vehicle to be sold in the United States. This summer, Ford also will debut its EcoBoost engine technology in the Taurus SHO, Lincoln MKS, Ford Flex and all-new Lincoln MKT crossover vehicle. In these vehicles, EcoBoost provides the fuel economy of a six-cylinder engine and the performance of a V-8. FORD MOTOR COMPANY JULY 2009 U.S. SALES July % Year-To-Date % ---- ------------ 2009 2008 Change 2009 2008 Change ---- ---- ------ ---- ---- ------ Sales By Brand Ford 142,135 138,175 2.9 802,483 1,117,746 -28.2 Lincoln 6,672 8,819 -24.3 47,382 65,713 -27.9 Mercury 10,031 9,412 6.6 54,725 82,007 -33.3 ------ ----- ------ ------ Total Ford, Lincoln and Mercury 158,838 156,406 1.6 904,590 1,265,466 -28.5 Volvo 6,441 5,124 25.7 36,187 51,305 -29.5 ----- ----- ------ ------ Total Ford Motor Company 165,279 161,530 2.3 940,777 1,316,771 -28.6 Ford, Lincoln and Mercury Sales By Type Cars 62,176 57,177 8.7 342,228 457,622 -25.2 Crossover Utility Vehicles 37,419 27,336 36.9 203,741 240,393 -15.2 Sport Utility Vehicles 6,526 10,213 -36.1 50,563 108,921 -53.6 Trucks and Vans 52,717 61,680 -14.5 308,058 458,530 -32.8 ------ ------ ------- ------- Total Trucks 96,662 99,229 -2.6 562,362 807,844 -30.4 ------ ------ ------- ------- Total Vehicles 158,838 156,406 1.6 904,590 1,265,466 -28.5 FORD BRAND JULY 2009 U.S. SALES ------------------------------- July % Year-To-Date % ---- ------------ 2009 2008 Change 2009 2008 Change ---- ---- ------ ---- ---- ------ Crown Victoria 3,766 4,325 -12.9 21,949 31,765 -30.9 Taurus 1,760 4,100 -57.1 19,141 36,016 -46.9 Fusion 17,610 10,607 66.0 102,756 98,530 4.3 Focus 21,830 15,200 43.6 91,184 138,649 -34.2 Mustang 6,686 10,711 -37.6 40,474 65,764 -38.5 ----- ------ ------ ------ Ford Cars 51,652 44,943 14.9 275,504 370,724 -25.7 Flex 3,631 2,204 64.7 23,692 3,583 561.2 Edge 7,857 8,508 -7.7 49,117 77,235 -36.4 Escape 20,241 10,421 94.2 96,643 102,486 -5.7 Taurus X 366 2,034 -82.0 5,650 16,803 -66.4 --- ----- ----- ------ Ford Crossover Utility Vehicles 32,095 23,167 38.5 175,102 200,107 -12.5 Expedition 2,565 3,469 -26.1 16,521 35,760 -53.8 Explorer 3,108 5,404 -42.5 27,442 55,339 -50.4 ----- ----- ------ ------ Ford Sport Utility Vehicles 5,673 8,873 -36.1 43,963 91,099 -51.7 F-Series 36,327 44,829 -19.0 215,959 319,542 -32.4 Ranger 7,695 4,677 64.5 34,118 45,980 -25.8 Econoline/Club Wagon 7,792 11,146 -30.1 54,680 85,721 -36.2 Transit Connect 417 0 NA 417 0 NA Low Cab Forward 23 81 -71.6 167 635 -73.7 Heavy Trucks 461 459 0.4 2,573 3,938 -34.7 --- --- ----- ----- Ford Trucks and Vans 52,715 61,192 -13.9 307,914 455,816 -32.4 ------ ------ ------- ------- Ford Brand 142,135 138,175 2.9 802,483 1,117,746 -28.2 LINCOLN BRAND JULY 2009 U.S. SALES ---------------------------------- July % Year-To-Date % ---- ------------ 2009 2008 Change 2009 2008 Change ---- ---- ------ ---- ---- ------ MKS 1,205 2,279 -47.1 9,666 2,664 262.8 MKZ 1,532 2,331 -34.3 13,340 20,978 -36.4 Town Car 1,841 943 95.2 7,946 9,982 -20.4 MKX 1,642 2,010 -18.3 12,742 19,573 -34.9 Navigator 450 768 -41.4 3,544 9,802 -63.8 Mark LT 2 488 -99.6 144 2,714 -94.7 --- --- --- ----- Lincoln Brand 6,672 8,819 -24.3 47,382 65,713 -27.9 MERCURY BRAND JULY 2009 U.S. SALES ---------------------------------- July % Year-To-Date % ---- ------------ 2009 2008 Change 2009 2008 Change ---- ---- ------ ---- ---- ------ Grand Marquis 2,667 2,569 3.8 14,239 19,310 -26.3 Sable 345 2,276 -84.8 5,710 11,702 -51.2 Milan 2,934 1,836 59.8 15,823 22,262 -28.9 Mariner 3,682 2,159 70.5 15,897 20,713 -23.3 Mountaineer 403 572 -29.5 3,056 8,020 -61.9 --- --- ----- ----- Mercury Brand 10,031 9,412 6.6 54,725 82,007 -33.3 VOLVO BRAND JULY 2009 U.S. SALES -------------------------------- July % Year-To-Date % ---- ------------ 2009 2008 Change 2009 2008 Change ---- ---- ------ ---- ---- ------ S40 525 431 21.8 4,073 7,203 -43.5 V50 181 120 50.8 954 1,151 -17.1 S60 1,461 409 257.2 5,016 6,720 -25.4 S80 602 745 -19.2 5,391 7,657 -29.6 V70 241 234 3.0 1,154 2,336 -50.6 XC60 762 0 NA 4,289 0 NA XC70 722 668 8.1 3,536 6,302 -43.9 XC90 850 1,546 -45.0 5,613 13,011 -56.9 C70 685 540 26.9 3,745 4,144 -9.6 C30 412 431 -4.4 2,416 2,781 -13.1 --- --- ----- ----- Volvo Brand 6,441 5,124 25.7 36,187 51,305 -29.5 The sales data are based largely on data reported by dealers representing their sales to retail and fleet customers. About Ford Motor 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 by the Troubled Company Reporter on April 15, 2009, Standard & Poor's Ratings Services said it raised its ratings on Ford Motor Co. and related entities, including the corporate credit rating, to 'CCC+' from 'SD-'. The ratings on Ford Motor Credit Co. are unchanged, at 'CCC+', and the ratings on FCE Bank PLC, Ford Credit's European bank, are also unchanged, at 'B-', maintaining the one-notch rating differential between FCE and its parent Ford Credit. S&P said that the outlook on all entities is negative. Moody's Investors Service in December 2008 lowered the Corporate Family Rating and Probability of Default Rating of Ford Motor Company to Caa3 from Caa1 and lowered the company's Speculative Grade Liquidity rating to SGL-4 from SGL-3. The outlook is negative. The downgrade reflects the increased risk that Ford will have to undertake some form of balance sheet restructuring to achieve the same UAW concessions that General Motors and Chrysler are likely to achieve as a result of the recently-approved government bailout loans. Such a balance sheet restructuring would likely entail a loss for bond holders and would be viewed by Moody's as a distressed exchange and consequently treated as a default for analytic purposes. FOUNDATION COAL: Moody's Confirms 'Ba2' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service confirmed the Ba2 Corporate Family Rating and Ba3 senior unsecured rating, and affirmed the SGL-1 Speculative Grade Liquidity Rating of Foundation Coal Corporation, which was re-named Alpha Natural Resources, Inc., on July 31, 2009. On that date, Alpha Natural Resources, Inc (pre-merger Alpha) acquired Foundation Coal Holdings, Inc., and the two entities, along with Foundation Coal Corporation, merged into Foundation, which then changed its name to Alpha Natural Resources, Inc. The rating outlook is stable. At the same time Moody's withdrew all of the ratings of the pre-merger Alpha -- all of its rated debt was repaid in conjunction with the merger. This concludes the rating reviews of Foundation Coal Corporation and pre-merger Alpha that began on May 12, 2009. The confirmation of Alpha's Corporate Family Rating reflects the merged company's size and scale as the third largest coal producer in the U.S. with approximately 90 million tons of annual production, its diversity of operations in three principal coal producing regions, the ability to sell up to approximately 10 million tons of its production as met coal, a conservative financial position, and what should be the ability to produce free cash flow even in an environment of weak thermal and met coal markets. The rating is negatively impacted by the geological and operating challenges of the coal mining industry, the disruptions to production that have frequented the few large mines that come from the Foundation side of the merger, and the large number of small and relatively high cost mines that come from the Alpha side of the merger. The rating also considers increasing environmental and safety costs, and difficulties and delays that may be experienced in obtaining surface mining permits in Central Appalachia. Finally, the rating considers the pre-merger Alpha's history of making frequent, albeit successful, acquisitions. Outlook Actions: Issuer: Foundation Coal Corporation -- Outlook, Changed to Stable From Rating Under Review Issuer: Foundation PA Coal Company -- Outlook, Changed to Stable From Rating Under Review Confirmations: Issuer: Foundation Coal Corporation -- Probability of Default Rating, Confirmed at Ba2 -- Corporate Family Rating, Confirmed at Ba2 Issuer: Foundation PA Coal Company -- Senior Unsecured Regular Bond/Debenture, Confirmed at Ba3, LGD4, 69% from LGD5, 83% Affirmations: Issuer: Foundation Coal Corporation -- Speculative Grade Liquidity Rating, Affirmed at SGL-1 Moody's last rating action on the pre-merger Alpha Natural Resources, Inc. was to place its B1 Corporate Family Rating and other ratings under review for possible upgrade on May 12, 2009. Moody's last rating action on Foundation Coal Corporation was to place its Ba2 Corporate Family Rating and other ratings on review for possible downgrade, also on May 12, 2009. Headquartered in Abingdon, Virginia, Alpha Natural Resources, Inc. is one of the largest coal companies in the U.S. and , pro forma for the merger of Alpha and Foundation, had revenues of approximately $1.8 billion in the first six months of 2009. FREMONT GENERAL: Files Investment Incentive Plan for 2007 and 2008 ------------------------------------------------------------------ Fremont General Corp. filed with the Securities and Exchange Commission its Investment Incentive Plan as of December 31, 2008, and 2007. The Company related that the net assets available for benefits for the year ending December 31, 2008 was $29,345,670 and $80,794,50 for the year ending December 31, 2007. A full-text copy of the Form 11-K is available for free at: http://ResearchArchives.com/t/s?4097 Based in Santa Monica, California, Fremont General Corp. (OTC: FMNTQ) -- http://www.fremontgeneral.com/-- was a financial services holding company with $8.8 billion in total assets at September 30, 2007. Fremont General ceased being a financial services holding company on July 25, 2008, when its wholly owned bank subsidiary, Fremont Reorganizing Corporation (f/k/a Fremont Investment & Loan) completed the sale of its assets, including all of its 22 branches, and 100% of its $5.2 billion of deposits to CapitalSource Bank. Fremont General filed for Chapter 11 protection on June 18, 2008, (Bankr. C.D. Calif. Case No. 08-13421). Robert W. Jones, Esq., and J. Maxwell Tucker, Esq., at Patton Boggs LLP, Theodore Stolman, Esq., Scott H. Yun, Esq., and Whitman L. Holt, Esq., at Stutman Treister & Glatt, represent the Debtor as counsel. Kurtzman Carson Consultants LLC is the Debtor's Noticing Agent and Claims Processor. Lee R. Bogdanoff, Esq., Jonathan S. Shenson, Esq., and Brian M. Metcalf, at Klee, Tuchin, Bogdanoff & Stern LLP, represent the Official Committee of Unsecured Creditors as counsel. The Debtor filed with the Court an amended schedule of its assets and liabilities on October 30, 2008, disclosing $330,036,435 in total assets and $326,560,878 in total debts. FRONTIER AIRLINES: Bidders' Final Proposals Due August 10 --------------------------------------------------------- As widely reported, Southwest Airlines confirmed on July 30, 2009, that it has submitted a non-binding proposal worth a minimum of $113.6 million to purchase Frontier Airlines, thwarting a rival bid of $108.75 million previously proposed by Republic Airways Holdings, Inc. To recall, Judge Robert D. Drain of the U.S. Bankruptcy Court for the Southern District of New York approved on July 13, 2009, the investment agreement between Frontier Airlines Holdings, Inc. and Republic Holdings. Under the Investment Agreement, Republic Holdings will purchase 100% of Frontier Holdings' stock for $108.75 million upon its emergence from bankruptcy, so long as certain conditions are met, thereby making Frontier a wholly- owned subsidiary of Republic. The Investment Agreement also allows Frontier to seek higher or otherwise better competing bids pursuant to the Court-approved auction procedures. Interested bidders are required to submit an initial proposal by August 3, 2009, and a final proposal by August 10. In consultation with the Official Committee of Unsecured Creditors, Frontier will conduct an auction, if necessary, for the period from August 11 to 17, to consider all qualified proposals and determine the highest or otherwise best proposal. Frontier can terminate the Investment Agreement upon identification and acceptance of the better offer. In an official statement, Southwest said it is "preparing its proposal; therefore, it is premature to comment on the specifics at this point." Ron Ricks, Executive Vice President at Southwest reiterated in a conference call that "the final form of the bid hasn't been set," according to Bloomberg News. Mr. Ricks noted that Southwest had conducted an intensive study on Frontier and "been considering a bid for some time, independent of any action Republic took with its bid proposal." "We have the cash, access to capital, and collateral that allows us to take advantage of this existing opportunity and synergies between Southwest and Frontier. We believe this is an opportunity to expand our network with legendary low fares, add jobs into Southwest, and boost competition in Denver as well as other cities with our low fares and high quality Customer Service," Ron Ricks, executive vice president for Corporate Services and corporate secretary at Southwest, said. "We see a strong fit between our Company cultures, a mutual commitment to high quality Customer Service, and similar entrepreneurial roots," Gary Kelly, Southwest's chairman of the Board, president, and CEO, added, noted Bloomberg. "[We are] in this to win. We take this very, very seriously," Mr. Ricks added. Experts opined that while Southwest's acquisition Frontier could pose challenges with respect to the meshing of the airlines' fleets, labor forces and network operations, the move will allow Southwest to expand its business, Reuters reported. Southwest Executive Vice President Bob Jordan specifically noted that while the airline couldn't commit to operating Frontier's flights outside the U.S. on a set date, "we are very interested in understanding the near-international routes," Bloomberg said. The successful bidder will acquire Frontier, along with its gates at the Denver International Airport. Frontier has 17 gates on Concourse A, Republic flies regional jets in and out of DIA for other airlines and Southwest owns several gates, the Denver Post noted. As the airlines' leases at DIA are set to expire, "there may be an alignment of the stars . . . [and] at some point, we would hope for some efficiencies you could gain by consolidating things" on one concourse, Mr. Jordan said, according to the Denver Post. Patrick Heck, DIA's deputy manager for business development, clarified that "no decisions have been made yet." Republic Holdings, for its part, is studying their options and the Southwest bid, Bloomberg reported, quoting spokesman Carlo Bertolini, as saying. Subsequent to Southwest's posting of its rival bid to take over Frontier, Republic Holdings confirmed that it had completed the acquisition of Midwest Airlines from Texas private equity group TPG Capital, for $6 million in cash, and a $25 million five-year note that can be converted to Republic stock at $10 a share. Accordingly, Midwest would operate as a Republic unit. About Frontier Airlines Holdings Frontier Airlines Holdings, Inc. (Pink Sheets: FRNTQ) -- http://www.FrontierAirlines.com/-- is the parent company of Denver-based Frontier Airlines. Currently in its 15th year of operations, Frontier Airlines is the second-largest jet service carrier at Denver International Airport, employing approximately 5,000 aviation professionals. Frontier Airlines' mainline operation has 51 aircraft with one of the youngest Airbus fleets in North America. In conjunction with a fleet of 10 Bombardier Q400 aircraft operated by Lynx Aviation -- a subsidiary of Frontier Airlines Holdings, Inc. -- Frontier offers routes to more than 50 destinations in the U.S., Mexico and Costa Rica. Frontier Airlines and its debtor-affiliates filed for Chapter 11 protection on April 10, 2008 (Bankr. S.D.N.Y. Case No. 08-11297 thru 08-11299). Benjamin S. Kaminetzky, Esq., and Hugh R. McCullough, Esq., at Davis Polk & Wardwell, represent the Debtors in their restructuring efforts. Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is the Debtors' Special Counsel, and Kekst and Company is the Debtors' Communications Advisors. The Debtors' exclusive period to file a plan of reorganization will expire on October 9, 2009. Their exclusive period to solicit and obtain acceptances of that plan will expire December 9, 2009. Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Frontier Airlines Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FRONTIER AIRLINES: Gives Information on Directors ------------------------------------------------- In a first amendment to its Annual Report for the fiscal year ended March 31, 2009, filed with the Securities and Exchange Commission on July 29, 2009, Frontier Airlines Holdings, Inc., disclosed information concerning the Company's directors, executive officers and corporate governance. Frontier Chief Executive Officer and Director Sean E. Menke reported that the Company's Board of Directors is comprised of: Board of Director Member Position ------------------------ -------- Sean Menke President, CEO D. Dale Browning Director Rita M. Cuddihy Director Paul S. Dempsey Director Patricia A. Engels Director B. LaRae Orullian Director Jeff S. Potter Director Robert D. Taylor Director James B. Upchurch Director During the fiscal year ended March 31, 2009, each Frontier director received (x) a quarterly retainer of $2,500, (y) board meeting fees of $750 per meeting attended personally, and (z) $375 per meeting attended telephonically. In addition, Mr. Browning received a $2,500 annual retainer for serving as the chair of the board. Ms. Orullian also received a $2,500 annual retainer for serving as the chair of the audit committee. Ms. Engels received an annual retainer of $1,500 for serving as the chair of the compensation committee, and Mr. Dempsey received an annual retainer of $1,500 for serving as the chair of the Nominating and Corporate governance Committee. The directors did not receive any additional compensation or fees for attending committee meetings. Following the Petition Date, the Directors agreed to reduce their annual retainer and board meeting fees by 50%, according to Mr. Menke. For the fiscal year ended March 31, 2009, each of the non- employee directors earned these fees: Fees Earned or Director Paid in Cash -------- -------------- D. Dale Browning $13,313 Rita M. Cuddihy 8,688 Paul S. Dempsey 7,750 Patricia A. Engels 10,938 B. LaRae Orullian 11,750 Jeff S. Potter 6,250 Robert D. Taylor 9,438 James B. Upchurch 7,375 None of the Directors received any stock awards during the Reporting Period. Mr. Menke further disclosed that for the fiscal year ended March 31, 2009, KPMG LLP received a total of $917,521 for the auditing services it rendered to the Company. The number of shares of the Frontier's common stock outstanding as of July 27, 2009 was 36,945,744. A full-text copy of the Amendment No. 1 to Frontier's Annual Report on Form 10-K/A is available with the SEC at: http://ResearchArchives.com/t/s?4073 About Frontier Airlines Holdings Frontier Airlines Holdings, Inc. (Pink Sheets: FRNTQ) -- http://www.FrontierAirlines.com/-- is the parent company of Denver-based Frontier Airlines. Currently in its 15th year of operations, Frontier Airlines is the second-largest jet service carrier at Denver International Airport, employing approximately 5,000 aviation professionals. Frontier Airlines' mainline operation has 51 aircraft with one of the youngest Airbus fleets in North America. In conjunction with a fleet of 10 Bombardier Q400 aircraft operated by Lynx Aviation -- a subsidiary of Frontier Airlines Holdings, Inc. -- Frontier offers routes to more than 50 destinations in the U.S., Mexico and Costa Rica. Frontier Airlines and its debtor-affiliates filed for Chapter 11 protection on April 10, 2008 (Bankr. S.D.N.Y. Case No. 08-11297 thru 08-11299). Benjamin S. Kaminetzky, Esq., and Hugh R. McCullough, Esq., at Davis Polk & Wardwell, represent the Debtors in their restructuring efforts. Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is the Debtors' Special Counsel, and Kekst and Company is the Debtors' Communications Advisors. The Debtors' exclusive period to file a plan of reorganization will expire on October 9, 2009. Their exclusive period to solicit and obtain acceptances of that plan will expire December 9, 2009. Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Frontier Airlines Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FRONTIER AIRLINES: Proposes Morgan Stanley Fuel Supply Contract --------------------------------------------------------------- Frontier Airlines Inc. and its affiliates consume substantial quantities of jet fuel in the ordinary course of their businesses. For the fiscal year ended March 31, 2009, jet fuel accounted for 41.5% of the Debtors' operating expenses. To ensure a reliable supply of jet fuel, Frontier purchases from various suppliers, including Morgan Stanley Capital Group, Inc. Frontier and Morgan Stanley were parties to a forward fuel supply contract that, pursuant to Section 556 of the Bankruptcy Code, terminated after the Petition Date. On May 30, 2008, the Court approved the Debtors' entry into a renewal of the prepetition supply contract -- the First Replacement Contract -- on terms similar to the prepetition contract. The Replacement Contract expired on April 30, 2009. In this regard, the Debtors sought and obtained the Court's approval to execute a Second Replacement Contract with Morgan Stanley in order to memorialize the parties' existing relationship. Under the terms of the Second Replacement Contract, Morgan Stanley has met, and will continue to meet, certain of Frontier's fuel requirements by delivering to Frontier approximately 25,000 barrels of bonded and domestic jet fuel per month through April 30, 2010, at the prevailing market price plus a small premium. The Second Replacement Contract is a requirements contract that estimates that these number of barrels of bonded jet fuel have and will continue to be delivered to the Debtors' facilities on a monthly basis, including: -- 11,900 barrels at Denver International Airport; -- 8,300 barrels at Los Angeles International Airport; and -- 4,800 barrels at LaGuardia Airport. In addition, the Second Replacement Contract permits Morgan Stanley to terminate the contract upon the occurrence of certain events, including (i) Frontier's failure to prepay amounts due, or (ii) the conversion of Frontier's Chapter 11 case to Chapter 7. Damian S. Schaible, Esq., at Davis Polk & Wardwell, in New York, relates that the Second Replacement Contract will allow the Debtors to maintain a secure and ready supply of jet fuel at a competitive cost. He adds that it will be executed in the ordinary course of the Debtors' businesses, but will be performed under Sections 363(b)(1) and 363(c)(1) of the Bankruptcy Code, as requested by Morgan Stanley. Mr. Schaible avers that the Debtors have provided the relevant information to the Official Committee of Unsecured Creditors, with which they intend to work closely in the analysis of the Second Replacement Contract. The Debtors also filed with the Court a certificate of no objection to their request. About Frontier Airlines Holdings Frontier Airlines Holdings, Inc. (Pink Sheets: FRNTQ) -- http://www.FrontierAirlines.com/-- is the parent company of Denver-based Frontier Airlines. Currently in its 15th year of operations, Frontier Airlines is the second-largest jet service carrier at Denver International Airport, employing approximately 5,000 aviation professionals. Frontier Airlines' mainline operation has 51 aircraft with one of the youngest Airbus fleets in North America. In conjunction with a fleet of 10 Bombardier Q400 aircraft operated by Lynx Aviation -- a subsidiary of Frontier Airlines Holdings, Inc. -- Frontier offers routes to more than 50 destinations in the U.S., Mexico and Costa Rica. Frontier Airlines and its debtor-affiliates filed for Chapter 11 protection on April 10, 2008 (Bankr. S.D.N.Y. Case No. 08-11297 thru 08-11299). Benjamin S. Kaminetzky, Esq., and Hugh R. McCullough, Esq., at Davis Polk & Wardwell, represent the Debtors in their restructuring efforts. Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is the Debtors' Special Counsel, and Kekst and Company is the Debtors' Communications Advisors. The Debtors' exclusive period to file a plan of reorganization will expire on October 9, 2009. Their exclusive period to solicit and obtain acceptances of that plan will expire December 9, 2009. Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Frontier Airlines Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: ACE American Wants Prompt Decision on Contract -------------------------------------------------------------- ACE American Insurance Company and Motors Liquidation Co., formerly known as General Motors Corp., are parties to certain policies and agreements, including a Foreign Casualty Insurance Program, directors' and officers' liability insurance policies, and excess casualty insurance policies. The ACE Policies also include numerous agreements concerning the payment of premiums, the indemnification and handling of claims, the collateral security provided to ACE in order to protect ACE against a default by the Debtors. As of July 21, 2009, the Debtors have not assumed or rejected the ACE Policies and Agreements. Andrew K. Lipetz, Esq., at Wasserman Grubin & Rogers, LLP, in New York, says the Debtors have served on ACE two vague and indefinite notices of intent to assume and assign executory contracts, however the limited information in the notices was unintelligible. In light of the Debtors having not assumed any of the ACE Policies, he notes that General Motors Company or New GM does not have coverage under the ACE Policies. Similarly, the Debtors' foreign subsidiaries and affiliates that were insured under the ACE Foreign Casualty Insurance Program may also not have coverage, because they are no longer subsidiaries or affiliates of the Debtors. Under these circumstances, Mr. Lipetz points out, ACE is unable to determine the scope of its obligations to the Debtors and New GM. Despite repeated and ongoing efforts by ACE to initiate discussions with the Debtors, the Debtors still have failed to state their intentions on the assumption and assignment of the ACE Policies, and the satisfaction of any cure amounts and regarding adequate assurance of future performance, he contends. Against this backdrop, ACE asks the Court to compel the Debtors to assume or reject the ACE Policies. In the event the Debtors assume the ACE Policies, ACE asks the Court to direct the Debtors to: * cure defaults and provide adequate assurance of future performance under the Insurance Policies; * provide to ACE the information regarding the financial condition of the New GM so that ACE could make an informed decision whether to agree to an assignment of the ACE Policies to the New GM; and * provide to ACE, as a condition of the assignment of the ACE Policies to the New GM, a valid and acceptable commitment from the New GM to fully perform the Debtors' obligations under the ACE Policies. 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. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Buyout Offer for UAW Workers Expires ---------------------------------------------------- United Auto Workers-represented workers and salaried employees hade until July 31, 2009, to accept buyout packages and retirement offers proposed by General Motors Company, or New GM, Detroit Free Press discloses. New GM will offer cash payments ranging from $20,000 to $115,000, Free Press says. However, New GM did not cite any expected number of workers that will be accommodated by the buyout, only citing that the official buyout number will be disclosed after some time, Free Press points out. New GM intends to reduce UAW workers by 13,500 at the end of 2009, and salaried employees by 4,000, Free Press notes. New GM will also trim its executive staff by 35%, Free Press adds. 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. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: ESIS Inc. Wants Prompt Decision on Agreement ------------------------------------------------------------ ESIS, Inc., and the Debtors entered into Claims Administration Services Agreements, which are part of the Debtors' overall insurance program. ESIS' obligations under the Agreements include providing third-party administration services for certain insurance claims asserted by and against the Debtors. Andrew K. Lipetz, Esq., at Wasserman Grubin & Rogers, LLP, in New York, notes that the Debtors have informally told ESIS that they intend to assume or reject the Agreements, but as of July 21, 2009, no notice was received by ESIS. He further points out that the Agreements were not listed in the Debtors' schedules of assumed executory contracts. Mr. Lipetz tells the Court that despite ESIS' efforts to initiate discussions with the Debtors, the Debtors have failed to state their intentions as to the assumption and assignment of the Agreements, the satisfaction of any cure amounts, and regarding adequate assurances of future performance. More importantly, he asserts that the Debtors' non-decision on the Agreements, has caused uncertainty regarding the scope of ESIS' contractual obligations. For one, it seems that ESIS' obligations do not include the administration of claims the liabilities for which have been assumed by General Motors Company, or New GM. Similarly, ESIS does not know which entity, if any, will perform the Debtors' obligations under the Agreements. The uncertainty about whether the Debtors are assuming and assigning the Agreements will impede the performance of the obligations of all parties to the Agreements, and may adversely affect the Insurance Program that has been purchased from the Debtors by the New GM, he maintains. Accordingly, ESIS asks the Court to compel the Debtors' assumption or rejection of the Agreements. In the event of assumption, ESIS asks the Court to require the Debtors to: * provide for cure of defaults and provide adequate assurance of future performance to ESIS; * provide to ESIS the information regarding the financial condition of the New GM so that ESIS can make an informed decision on whether to agree to an assignment of the Agreements to the New GM; and * provide to ESIS, as a condition of the assignment of the Agreements to the New GM, a valid and acceptable commitment from the New GM to fully perform the Debtors' obligations under the Agreements. 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. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Toyota to Liquidate Stake in Nummi JV ----------------------------------------------------- Toyota Motor Corp. confirmed on July 24, 2009, that it is liquidating its stake in New United Motor Manufacturing Inc., which is jointly operated with General Motors. GM stated in June 2009 that it is terminating the NUMMI venture amid disagreements on the future product to be manufactured at the facility. NUMMI is based in Fremont, California, and has been run by GM and Toyota since 1984. It employs 4,600 workers who make the Pontiac Vibe station wagon for GM and the Corolla compact car and Tacoma pickup truck for Toyota. Toyota spokesman Paul Nolasco stated that Toyota "is in a really difficult situation," and is "pressed to make hard decisions," the Associated Press reported. In an effort to save the jobs of its 4,500 represented workers, the United Auto Workers union called on its members to urge U.S. lawmakers to impede the probable closure of NUMMI, Reuters reported. "We believe that Toyotas sold in the United States should be made in the United States. California is by far Toyota's single biggest market for car sales in the United States," the UAW said in its email message, according to the report. 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. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Opel May Be Sent to Bankr. Absent Sale Consensus ---------------------------------------------------------------- General Motors Corp.'s Opel unit may be forced into bankruptcy if the automaker and the German government fail to agree on a buyer, Bloomberg's Carla Main reported, citing three people close to the trust that controls the division. The German government has preferred Magna International Inc. as a buyer for Opel as the automotive supplier has promised to keep jobs. The trust's five-member board, however, prefers RHJ International SA as the buyer or pushing Opel into insolvency, Bloomberg said. GM negotiators are also fighting Magna's bid because they're concerned about losing control of some patents, Bloomberg said, citing one of the people. The German government is providing EUR1.5 billion (US$2.1 billion) in short-term loans to Opel for the sale. A spokesman to Germany Chancellor Angela Merkel has earlier warned that no deal is possible without the German government's approval. The trust was set up as an interim owner of Opel. It oversees talks with the suitors approves any business decisions by Opel, including which bidder will win. A final decision on the sale is made by General Motors, which is now controlled by the U.S. Treasury. Acording to Bloomberg, GM's board will review bids for Opel during a meeting starting Aug. 3, people familiar with the planning have said. The trust will gather to discuss the bids the following week, said two of the people. Approval is also required by the U.S. Treasury, people familiar with the process have said. Brussels-based RHJ is bidding for a 51 percent stake in Opel and is asking for EUR700 million less than Magna in government aid to secure Opel's future, while Magna, which is bidding for Opel with Moscow-based OAO Sberbank, would provide EUR350 million of cash directly under an improved cash offer for the unit, Bloomberg notes. 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. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENOA HEALTHCARE: CEO Departure Won't Affect Moody's 'B2' Rating ---------------------------------------------------------------- Moody's commented that there is no immediate impact to the ratings of Genoa Healthcare Group, LLC, due to the recent departure of the company's CEO and CFO. The Corporate Family Rating and Probability of Default Rating are B2 and the outlook is negative. The last rating action was on December 18, 2007, when the outlook was changed to negative from stable. Genoa's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as: i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record of tolerance for risk. Those attributes were compared against other issuers both within and outside of Genoa's core industry and Genoa's ratings are believed to be comparable to those other issuers of similar credit risk. Headquartered in Tampa, Florida, Genoa, through its subsidiaries, provides skilled nursing, medically complex and specialty healthcare services in 61 skilled nursing facilities throughout the state of Florida. The company also provides consulting and administrative services to an additional 66 facilities in 16 states and the District of Columbia through contractual arrangements. GEORGIA GULF: Completes Private Debt Exchange Offer --------------------------------------------------- Georgia Gulf Corporation last week closed its private debt exchanges and announced the effectiveness of a long-term amendment to its senior secured credit agreement. "For several months we have been working closely with our lenders and bondholders to restructure our balance sheet and provide Georgia Gulf the financial flexibility to weather current economic conditions and to provide a solid foundation for growth. With our new capital structure, valuable asset base and skilled and dedicated employees, we are a strong business partner positioned for the long term in our chemicals and building products businesses. We look forward to continuing to work with our customers and suppliers to lead our markets as economic conditions improve," commented Paul Carrico, Georgia Gulf's President and CEO. Debt Exchanges Georgia Gulf previously announced the results of its private offers to exchange its outstanding 7.125% Senior Notes due 2013, 9.5% Senior Notes due 2014, and 10.75% Senior Subordinated Notes due 2016, for shares of its convertible preferred stock and shares of its common stock. Roughly $736.0 million, or 92.0% in aggregate principal amount, of the notes were accepted in exchange for roughly 30.2 million shares of convertible preferred stock and 1.3 million shares of common stock, giving effect to the 1-for-25 reverse stock split that became effective July 27. Moreover, roughly $726.0 million of aggregate principal amount of notes, together with the Company's obligations for accrued interest under such notes, were extinguished July 27 in settlement of the exchange offers in exchange for shares of common and convertible preferred stock. The remaining roughly $10.0 million of principal amount of notes are contractually committed to be exchanged and the Company expects those to be canceled for shares of common and convertible preferred stock in the near term. Long Term Bank Amendment In conjunction with the successful private debt exchange offers, the Company obtained an amendment to its senior secured credit agreement that adjusts the financial covenants to reflect current market conditions as well as the impact of the private debt exchanges. The maximum leverage ratios and minimum interest covenant ratios were adjusted through the term of the revolving lending facility. The amendment added a new minimum fixed charge coverage ratio covenant and a maximum senior secured leverage ratio covenant, while eliminating the minimum EBITDA covenant. The capital expenditure limitations established by the amendment are $45 million in 2010 and $50 million per year thereafter. The amendment also allows the Company to use 50% of the first $45 million of net cash proceeds from asset dispositions to make additional capital expenditures, subject to certain annual limitations and minimum EBITDA requirements. The amendment replaced the $75 million minimum revolver availability requirement with a permanent $75 million reduction in the aggregate revolving commitments, resulting in a $300 million revolver commitment. Under the amendment, the interest rates and certain fees payable to lenders were increased by 0.5% per annum. The Company also obtained an amendment to its $175 million asset securitization agreement that adjusts the financial covenants to conform to the covenants described above through the expiration of the asset securitization agreement in March 2011. Under the amendment, the interest rate was increased by 0.25% per annum. Related Transactions In conjunction with the completion of the debt exchanges and bank amendment: -- Effective July 27, the Company completed the previously described 1-for-25 reverse stock split, whereby the Company's currently outstanding common shares, before the issuance of common shares in the debt exchanges, were reduced to approximately 1.4 million shares. -- Pursuant to authority provided for in the Company's charter, about 32 million shares of a new series of convertible preferred stock were designated by the Company's Board of Directors, substantially all of which were issued in the debt exchanges. -- The Board approved, and has recommended for approval by the Company's stockholders, -- an amendment to the Company's charter to increase the number of authorized shares of common stock to 100 million; and -- a new equity incentive plan for the issuance of equity awards of the Company's common shares to Company employees. Further, the Board provided that stockholders of record August 17, 2009 will vote on these two proposals at a to be scheduled special meeting of stockholders. Upon approval and filing of the charter amendment to increase the number of authorized common shares, the shares of convertible preferred stock issued in the debt exchanges will automatically convert into common shares on a one-for-one basis. Perella Weinberg Partners acted as the Company's financial advisor and Jones Day as its legal advisor with regard to the private debt exchanges, bank amendment, and related transactions. About Georgia Gulf Georgia Gulf Corporation is a manufacturer and international marketer of two integrated chemical product lines, chlorovinyls and aromatics. The Company's primary chlorovinyls products are chlorine, caustic soda, vinyl chloride monomer (VCM), vinyl resins and vinyl compounds. Its aromatics products are cumene, phenol and acetone. The Company has four business segments: chlorovinyls; window and door profiles, and moldings products; outdoor building products, and aromatics. At March 31, 2009, the Company had $1.56 billion in total assets and $1.66 billion in total liabilities, resulting in $97.3 million stockholders' deficit. As reported in the Troubled Company Reporter on June 19, 2009, Standard & Poor's Ratings Services lowered its issue rating on Georgia Gulf Corp.'s $100 million 7.125% senior notes due 2013 to 'D' from 'C' and retained the '6' recovery rating, indicating S&P's expectation of negligible recovery (0%-10%) on the notes. At the same time, S&P kept its corporate credit rating on Georgia Gulf at 'D'. S&P had lowered its corporate credit rating and these issue ratings on Georgia Gulf to 'D' on May 21, 2009, following a missed interest payment of $34.5 million on these notes. As reported by the TCR on August 3, Moody's Investors Service upgraded the Corporate Family Rating of Georgia Gulf Corporation to B2 from Caa2 as a result of the completion of the private debt- for-equity exchange offer and an amendment to its credit facility that substantially improves the company's liquidity. GLEN SCOTT LANG: Case Summary & 13 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Glen Scott Lang 219 Surrey Hill Noblesville, IN 46062 Bankruptcy Case No.: 09-11196 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Southern District of Indiana (Indianapolis) Judge: Basil H. Lorch III Debtor's Counsel: Mark S. Zuckerberg, Esq. Law Office of Mark S. Zuckerberg, P.C. 333 N Pennsylvania St., Suite 100 Indianapolis, IN 46204 Tel: (317) 687-5157 Fax: (317) 687-5151 Email: filings@mszlaw.com Sally J. O'Connor, Esq. Law Office of Mark S. Zuckerberg, P.C. 333 N Pennsylvania St., Suite 100 Indianapolis, IN 46204 Tel: (317) 687-0000 Total Assets: $1,883,524 Total Debts: $1,860,578 A full-text copy of Mr. Lang's petition, including a list of his 13 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/insb09-11196.pdf The petition was signed by Mr. Lang. GOODYEAR TIRE: 2Q Results on Track to Meet Expectations, S&P Says ----------------------------------------------------------------- Standard & Poor's Ratings Services said that, based on The Goodyear Tire & Rubber Co.'s reported results for the second quarter, S&P believes its results are on track to meet S&P's expectations for the current rating (BB-/Negative/--). S&P assumes Goodyear will use less than $350 million in cash in 2009. S&P estimates that free cash flow totaled about $181 million in the second quarter, helped in part by better management of inventories and a sequential rise in operating profitability; S&P estimates it was a negative $365 million for the first half of 2009. Despite the ongoing weakness in the replacement and original equipment (OE) tire markets, price and mix of $127 million more than offset the cost of raw materials in the second quarter. In addition, the company reported that it realized approximately $200 million in cost savings. Total segment operating income was a weak $24 million in the second quarter, compared with $330 million in the second quarter a year ago, but a loss of $176 million in the first quarter. At the end of June, cash and cash equivalents stood at $2.4 billion, and the company had $1.7 billion available on its credit facilities. S&P believes there are signs of stabilization in the North American tire market. U.S. miles driven in May rose sequentially, and government incentive programs are supporting OE demand. Also, other regions of the world are contributing to positive results; Latin America and Asia generated positive operating income, and demand in China and India is rebounding. Nevertheless, S&P remains concerned about the ongoing recession in the U.S. and Europe, the possibility of increased price competition by major tire makers, and uncertainty about future pension contributions given capital market volatility. GPS INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: GPS Industries, Inc. 1358 Fruitville Road Sarasota, Fl 34236 Bankruptcy Case No.: 09-16766 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Judge: Catherine Peek McEwen Debtor's Counsel: Richard J. McIntyre, Esq. McIntyre, Panzarella, Thanasides & Eleff 6943 East Fowler Avenue Temple Terrace, FL 33617 Tel: (813) 899-6059 Fax: (813) 899-6069 Email: rich@mcintyrefirm.com Total Assets: $2,971,388 Total Debts: $27,901,483 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-16766.pdf The petition was signed by David Chessler, chief executive officer of the Company. GREY GOOSE FARMS: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Grey Goose Farms, Inc. 211 Kirkwood Ct. Sugarland, TX 77478 Bankruptcy Case No.: 09-35558 Chapter 11 Petition Date: August 2, 2009 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Sheila K. Deason, Esq. Deason Law Firm 2950 N Loop W, Suite 500 Houston, TX 77092 Tel: (713) 586-8820 Fax: (713) 868-2021 Email: deason@1stcounsel.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Linda M. Hawk, president of the Company. GTC BIOTHERAPEUTICS: Closes Securities Purchase Deal with LFB ------------------------------------------------------------- GTC Biotherapeutics Inc. on July 31, 2009, completed the closing of the transactions under its securities purchase agreement with LFB Biotechnologies S.A.S., dated June 18, 2009. At the closing, GTC issued to LFB 12,000 shares of its newly designated Series E-1 10% Convertible Preferred Stock and 13,500 shares of its newly designated Series E-2 10% Convertible Preferred Stock for payment to GTC of roughly $8.3 million cash and conversion of the $4.5 million convertible promissory note issued to LFB on June 18, 2009. The Series E-1 Convertible Preferred Stock is convertible into 4,562,738 shares of GTC common stock at a conversion price of $2.63 per share and the Series E-2 Convertible Preferred Stock is convertible into 6,305,437 shares of GTC common stock at a conversion price of $2.2368. If LFB were to fully convert all of its Series E and Series D convertible preferred stock, fully convert its $15M convertible note and exercise in full its warrant holdings, LFB would hold 19,782,550 shares of GTC common stock, or 70.1% of GTC shares outstanding. The Series E Preferred Stock was issued to LFB in reliance on the exemption from registration provided under the provisions of Section 4(2) of the Securities Act (and the regulations promulgated thereunder, including Regulation D) relating to sales by an issuer not involving a public offering. LFB has represented to GTC in the securities purchase agreement that it is acquiring the shares of Series E Preferred Stock and the shares of common stock issuable upon conversion thereof for investment and not for distribution, that it can bear the risks of the investment and that it has had an opportunity to ask questions of, and receive answers from, GTC regarding the terms and conditions of the offering. Amendment to Shareholder Rights Agreement In connection with the closing of the sale of Series E Preferred Stock, GTC entered into a Third Amendment to the Shareholder Rights Agreement dated July 30, 2009, with American Stock Transfer and Trust Company, as rights agent, further amending the Shareholder Rights Agreement dated May 31, 2001. The amendment exempts LFB's acquisition from GTC of shares of its Series E Convertible Preferred Stock so that the acquisition does not trigger the exercisability of the preferred stock purchase rights pursuant to the Shareholder Rights Agreement. Amendment to Articles of Organization GTC's Board of Directors approved an amendment to its Restated Articles of Organization which provided for the designation of (i) 18,000 shares of authorized and unissued Preferred Stock as shares of "Series E-1 10% Convertible Preferred Stock" and (ii) 27,000 shares of GTC authorized and unissued Preferred Stock as shares of "Series E-2 10% Convertible Preferred Stock." Each share of Series E Preferred Stock is convertible into fully paid and nonassessable shares of GTC common stock. Prior to this amendment, no such series of stock existed. The amendment to GTC's Restated Articles of Organization to designate these two new classes of Series E Preferred Stock was filed with the Massachusetts Secretary of the Commonwealth and became effective on July 30, 2009. Shareholders' Meeting On July 30, 2009, GTC held a special meeting of shareholders. A table sets forth the results of voting of GTC shareholders of common stock and Series D Preferred Stock, voting on an as- converted basis, on the proposal submitted at the meeting to its shareholders: Proposal "For" "Against" "Abstain" -------- ----- --------- --------- Proposal to approve the issuance 5,409,410 339,192 72,036 of Series E-1 10% Convertible Preferred Stock and Series E-2 10% Convertible Preferred Stock to LFB Biotechnologies S.A.S. pursuant to the Securities Purchase Agreement between GTC and LFB A full-text copy of GTC's letter to shareholders is available at no charge at http://ResearchArchives.com/t/s?40a0 Nasdaq Delisting Notice On June 18, 2009, GTC received a Staff Deficiency Letter from The Nasdaq Stock Market notifying that for the last 10 consecutive trading days the aggregate market value of the Company's common stock was below the $35,000,000 minimum market value required for continued listing on the Nasdaq Capital Market, as specified by Marketplace Rule 5550(b)(2). In accordance with Marketplace Rule 5810(c)(3)(C), GTC has 90 calendar days, or until September 16, 2009, to regain compliance with the minimum market value requirement. To regain compliance, the market value of GTC's common stock must equal or exceed $35,000,000 for a minimum of 10 consecutive business days or for such longer period that Nasdaq may, in its discretion, require. If GTC does not regain compliance with the minimum market value requirement by September 16, 2009, Nasdaq will provide written notification that GTC's common stock will be delisted. At that time, GTC may appeal Nasdaq's determination to delist its common stock to a Nasdaq Listings Qualifications Panel. GTC's common stock would continue to be listed during the appeals process. About GTC Biotherapeutics Headquartered in Framingham, Massachusetts, GTC Biotherapeutics, Inc. (NASDAQ: GTCB) -- http://www.gtc-bio.com-- develops, supplies, and commercializes therapeutic proteins produced through transgenic animal technology. The Company is also developing a portfolio of recombinant human plasma proteins with known therapeutic properties. The company also has a monoclonal antibody portfolio focused on follow-on biologics, including a CD20 monoclonal antibody. The intellectual property of the company includes a patent in the United States through 2021 for the production of any therapeutic protein in the milk of any transgenic mammal. Its transgenic production platform is particularly well suited to enabling cost effective development of proteins that are difficult to express in traditional recombinant production systems as well as proteins that are required in large volumes. GTC BIOTHERAPEUTICS: Net Loss Widens to $10.8 Million in Q2 2009 ---------------------------------------------------------------- GTC Biotherapeutics, Inc.'s total net loss for the second quarter ended June 28, 2009, was $10.8 million, or $1.03 per share, compared to $2.2 million, or $0.22 per share, for the second quarter of 2008. The total net loss for the first six months of 2009 was $21.1 million, or $2.03 per share, compared to $10.4 million, or $1.12 per share, for the first six months of 2008. GTC received $8.3 million of additional funding from LFB Biotechnologies upon the first closing under the June 18, 2009 agreement for the sale of new convertible preferred stock. "As a result of our financing transaction with our strategic partner, LFB Biotechnologies, we are taking an important step in re-establishing the financial stability of GTC with a committed, long term investor," stated Geoffrey F. Cox, Ph.D., GTC's Chairman of the Board and Chief Executive Officer. "We have also been very encouraged by the strong launch of ATryn(R) by our partner, Lundbeck Inc., and we believe this bodes well for future sales in the U.S. in the approved hereditary antithrombin deficiency indication as well as the potential for future broader indications we are developing together for approval, such as heparin resistance." At June 28, 2009, GTC had $29.0 million in total assets and $53.0 million in total liabilities, resulting in $23.9 million in stockholders' deficit. Cash and marketable securities at June 28, 2009 totaled $4.7 million, a $6.9 million decrease compared to $11.6 million at December 28, 2008. The second quarter cash and marketable securities includes the initial $4 million of convertible debt funding from LFB Biotechnologies. Subsequent to June 28, 2009, GTC received an additional $8.3 million from LFB Biotechnologies as part of the overall financing arrangement. Together with committed partnering milestone proceeds, but not including any new proceeds from contemplated partnering activities, this will fund operations into the fourth quarter of 2009. Revenues for the second quarter of 2009 were approximately $700,000, an $8.5 million decrease from the $9.1 million recorded in the second quarter of 2008. Revenues totaled approximately $900,000 for the first six months of 2009 compared to $12.7 million in the first six months of 2008, a decrease of $11.8 million. The revenue decreases in 2009 were driven by the termination of the ATryn(R) agreement with LEO and completion in 2008 of GTC's service contract work for PharmAthene and Merrimack Pharmaceuticals. GTC recently entered into an additional scope of service work with PharmAthene as they continue development of their Protexia(R) product. Costs of revenue and operating expenses totaled $10.3 million in the second quarter of 2009, approximately 6% lower than $11 million in the second quarter of 2008. Costs of revenue and operating expenses totaled $20.1 million for the first half of 2009, approximately 12% lower than $22.7 million in the first half of 2008. The lower expenses are primarily due to decreased costs in the ATryn(R) program and reduced work under GTC's fee-for- service contracts for its external programs. A full-text copy of GTC's quarterly report is available at no charge at http://ResearchArchives.com/t/s?409f Nasdaq Delisting Notice On June 18, 2009, GTC received a Staff Deficiency Letter from The Nasdaq Stock Market notifying that for the last 10 consecutive trading days the aggregate market value of the Company's common stock was below the $35,000,000 minimum market value required for continued listing on the Nasdaq Capital Market, as specified by Marketplace Rule 5550(b)(2). In accordance with Marketplace Rule 5810(c)(3)(C), GTC has 90 calendar days, or until September 16, 2009, to regain compliance with the minimum market value requirement. To regain compliance, the market value of GTC's common stock must equal or exceed $35,000,000 for a minimum of 10 consecutive business days or for such longer period that Nasdaq may, in its discretion, require. If GTC does not regain compliance with the minimum market value requirement by September 16, 2009, Nasdaq will provide written notification that GTC's common stock will be delisted. At that time, GTC may appeal Nasdaq's determination to delist its common stock to a Nasdaq Listings Qualifications Panel. GTC's common stock would continue to be listed during the appeals process. About GTC Biotherapeutics Headquartered in Framingham, Massachusetts, GTC Biotherapeutics, Inc. (NASDAQ: GTCB) -- http://www.gtc-bio.com-- develops, supplies, and commercializes therapeutic proteins produced through transgenic animal technology. The Company is also developing a portfolio of recombinant human plasma proteins with known therapeutic properties. The company also has a monoclonal antibody portfolio focused on follow-on biologics, including a CD20 monoclonal antibody. The intellectual property of the company includes a patent in the United States through 2021 for the production of any therapeutic protein in the milk of any transgenic mammal. Its transgenic production platform is particularly well suited to enabling cost effective development of proteins that are difficult to express in traditional recombinant production systems as well as proteins that are required in large volumes. HANGER ORTHOPEDIC: Moody's Upgrades Corp. Family Rating to 'B1' --------------------------------------------------------------- Moody's Investors Service upgraded the ratings of Hanger Orthopedic Group, Inc., including the Corporate Family Rating and Probability of Default Rating to B1 from B2. Moody's also upgraded the senior secured credit facility to Ba2 from Ba3 and the unsecured notes to B3 from Caa1. Moody's also changed the outlook to stable from positive. The upgrade of the Corporate Family Rating reflects Hanger's continued growth in EBITDA and cash flow generation, which has reduced financial leverage and brought credit metrics more in-line with the B1 rating. The improvement in operating performance has been driven by healthy same-store sales growth, tuck-in acquisitions, and operating efficiencies. While Moody's believes the pricing and reimbursement environment may not be as favorable over the rating horizon as it has been in recent years, Moody's believe mitigating factors include: a more attractive acquisition pipeline, cost reductions (both labor and materials) and new product introductions, thus supporting the B1 rating. The Corporate Family Rating of B1 reflects the company's competitive position as the largest O&P services provider in the U.S., its national footprint and relatively stable, recurring revenue model. The rating is constrained primarily by the company's modest size, financial leverage that is considerable (though improved) as well as the risks associated with the pricing and reimbursement environment in the O&P industry. Ratings upgraded: -- $75 million secured revolver due 2011, to Ba2 (LGD2, 27%) from Ba3 (LGD2, 27%) -- $230 million secured term loan due 2013, to Ba2 (LGD2, 27%) from Ba3 (LGD2, 27%) -- $175 million unsecured senior notes due 2014, to B3 (LGD5, 81%) from Caa1 (LGD5, 78%) -- Corporate Family Rating, to B1 from B2 -- Probability of Default Rating, to B1 from B2 The outlook is stable. The last rating action was August 7, 2008, when Moody's changed the outlook to positive. Hanger's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as: i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record of tolerance for risk. Those attributes were compared against other issuers both within and outside of Hanger's core industry and Hanger's ratings are believed to be comparable to those other issuers of similar credit risk. For further details, refer to Moodys.com for the latest Credit Opinion on Hanger. Hanger (NYSE: HGR), headquartered in Bethesda, Maryland, is the leading provider of O&P patient-care services in the US. The company owns and operates 671 patient care centers in 45 states and the District of Columbia. The company also generates roughly 12% of total revenues from its O&P distribution business. For the twelve months ended June 30, 2009, the company recognized revenue of approximately $727 million. HANOVER INSURANCE: S&P Withdraws 'BB-' Rating on $300 Mil. Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services said it withdrew its 'BB-' rating on Hanover Insurance Group Inc.'s AFC Capital Trust I's $300 million issue of preferred securities due February 2027. At the same time, S&P assigned a 'BB-' rating on the company's newly issued $165 million series B 8.207% junior subordinated deferrable interest debentures due February 3, 2027. "We withdrew S&P's rating on the $300 million preferred securities following the liquidation of the trust," said Standard & Poor's credit analyst Polina Chernyak. "The newly rated $165 million series B junior subordinated debentures have the same maturity, interest, and risk profile as the preferred stocks." HARVEST ENERGY: S&P Downgrades Corporate Credit Rating to 'B-' -------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its long-term corporate credit rating on Calgary, Alberta-based Harvest Energy Trust (Harvest or the trust) to 'B-' from 'B', and its senior unsecured debt ratings on subsidiary Harvest Operations Corp. to 'CCC' from 'CCC+'. The recovery rating of '6' on the senior unsecured notes is unchanged, and indicates S&P's expectation for negligible (0%-10%) recovery in the event of a default. The outlook is stable. "The downgrade reflects S&P's expectations that likely lower operating cash flows will constrain Harvest's ability to meaningfully reduce debt," said Standard & Poor's credit analyst Jamie Koutsoukis. "In addition, as the trust has a reduced capital program in place for 2009, S&P believes upstream production will continue to decline; its financial metrics will weaken, so the trust will have increased sensitivity to hydrocarbon prices," Ms. Koutsoukis added. In S&P's opinion, the ratings on Harvest reflect the trust's high leverage, as measured by debt per barrel of oil equivalent of net proven reserves and debt per throughput capacity at its refining operations; expected weak cash flow from operations in 2009 and 2010; below-average reserve life index; and relatively high full- cycle costs. S&P believes a high percentage of proven developed reserves; and the trust's good product mix, with added diversification from the refinery operations, offset these weaknesses. The stable outlook incorporates S&P's expectation that Harvest will be able to fund capital expenditures and manage distributions at a level that allows it to reduce its debt levels. It also reflects S&P's expectation that the trust will be able to refinance its existing bank debt due April 2010 (although S&P believes it will be below the current C$1.6 billion capacity). A negative rating action could occur if Harvest cannot refinance its existing bank debt or if the terms of the new facility meaningfully constrain the trust's ability to operate. In addition, if it is unable to internally fund its capital spending program and financing obligations, thereby increasing its debt outstanding, S&P could also lower the rating. A positive rating action, although unlikely in the near term, would depend on the trust improving operating performance and meaningfully reducing debt levels while funding its capital program through internally generated cash flows. HAWAII SUPERFERRY: Disclosure Statement Hearing Set for August 11 ----------------------------------------------------------------- HSF Holding, Inc., and Hawaii Superferry, Inc., ask the U.S. Bankruptcy Court for the District of Delaware to approve an explanatory disclosure statement with respect to their Joint Plan of Liquidation, which was filed with the Court on June 30, 2009. The Debtors also ask the Court to approve certain deadlines in connection with the hearing on the adequacy of the disclosure statement scheduled for August 11, 2009, at 2:00 p.m., and the hearing on confirmation of the Plan scheduled for September 23, 2009, at 2:00 p.m. The proposed deadlines are: August 11, 2009 Voting Record Date August 17, 2009 Distribution of Solicitation Packages September 15, 2009 Voting Deadline & Plan Objection Deadline September 21, 2009 Deadline for Debtors' Reply in Support of Confirmation Summary of Plan Terms The Plan provides for the liquidation and conversion of all of the Debtors' remaining assets to cash and the distribution of the net proceeds therefrom to creditors holding allowed claims, in accordance with the relative priorities set forth in the Bankruptcy Code. No distribution will be made on account of the Guggenheim secured claim in the outstanding principal amount of $51,752,288 as of the petition date, since Superferry stock against which it asserts a lien is being cancelled and has no value. The Guggenheim secured claim is therefore deemed to reject. HSF Holding general unsecured claims will receive a pro rata share of the net proceeds of any causes of action held and realized by HSF Holding, Inc. only. Hawaii Superferry general unsecured claims will receive a pro rata share of available cash after full satisfaction of, or the establishment of an appropriate reserve for, allowed administrative expense claims, allowed priority tax claims, allowed other priority claims, allowed secured tax claims, allowed other secured claims, and allowed convenience claims. The Debtors estimate that the total amount of Hawaii Superferry general unsecured claims is $25,020,114. Of this amount, approximately $21,366,792 was owing to Austal USA, a wholly owned subsidiary of Austal Ships, an Australian company, under the Austal term loans, while approximately $3,255,361 was owed to trade creditors. The Debtors anticipate that $509,175, or approximately 2% of allowed claims, may be available as of September 30, 2009, for distribution to holders of allowed Hawaii Superferry general unsecured claims. Equity Interests Deemed to Reject HSF Holding preferred stock equity interests and Hawaii Superferry preferred stock equity interests will not receive any distributions on account of such equity interests, since it is believed that the value of the Debtors' assets is less than the toal value of the Debtors' debts and liabilities. Holders of these interests are therefore deemed to reject the Plan. HSF Holding common stock equity interests and Hawaii Superferry common stock equity interests will also not receive any distributions of account of their equity interests, and thus, deemed to reject. Classes Entitled to Vote Only holders of HSF Holding general unsecured claims, Hawaii Superferry general unsecured claims and convenience claims are entitled to vote. A copy of the explanatory disclosure statement with respect to HSF Holding, Inc. and Hawaii Superferry, Inc.'s Joint Plan of Liquidation is available for free at: http://bankrupt.com/misc/HSF.ds.pdf Wilmington, Delaware-based HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high- speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The Company and its affiliate filed for Chapter 11 on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper Hamilton LLP represent the Debtors in their restructuring efforts. Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, is the Committee's proposed lead counsel. Adam Hiller, Esq., Brian Arban, Esq., and Michelle Berkeley-Ayres, Esq., at Atlantic Law, is the Committee's proposed local counsel. When the Debtors sought protection from their creditors, they listed between $100 million and $500 million each in assets and debts. HAWAII SUPERFERRY: Files New Schedules of Assets and Liabilities ---------------------------------------------------------------- Hawaii Superferry, Inc., filed with the U.S. Bankruptcy Court for the District of Delaware amended schedules of its assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------------ ------------ A. Real Property B. Personal Property $202,718,064 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $162,117,701 E. Creditors Holding Unsecured Priority Claims $261,068 F. Creditors Holding Unsecured Non-priority Claims $2,912,719 ------------ ------------ TOTAL $202,718,064 $165,291,489 A copy of the Debtor's new schedules is available at: http://bankrupt.com/misc/hawaiisuperferry.newschedules.doc Wilmington, Delaware-based HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high- speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The Company and its affiliate filed for Chapter 11 on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper Hamilton LLP represent the Debtors in their restructuring efforts. Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, is the Committee's proposed lead counsel. Adam Hiller, Esq., Brian Arban, Esq., and Michelle Berkeley-Ayres, Esq., at Atlantic Law, are the Committee's proposed local counsel. When the Debtors sought protection from their creditors, they listed between $100 million and $500 million each in assets and debts. HAWAII SUPERFERRY: Parent Files New Schedules of Assets & Debts --------------------------------------------------------------- HSF Holding, Inc., filed with the U.S. Bankruptcy Court for the District of Delaware amended schedules of its assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------------ ------------ A. Real Property B. Personal Property $131,639,820 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $51,752,288 E. Creditors Holding Unsecured Priority Claims F. Creditors Holding Unsecured Non-priority Claims ------------ ------------ TOTAL $131,639,820 $51,752,288 A full-text copy of the Schedules is available at: http://bankrupt.com/misc/hsfholding.SAL.pdf Wilmington, Delaware-based HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high- speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The Company and its affiliate filed for Chapter 11 on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper Hamilton LLP represent the Debtors in their restructuring efforts. Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, is the Committee's proposed lead counsel. Adam Hiller, Esq., Brian Arban, Esq., and Michelle Berkeley-Ayres, Esq., at Atlantic Law, are the Committee's proposed local counsel. When the Debtors sought protection from their creditors, they listed between $100 million and $500 million each in assets and debts. HAWAII SUPERFERRY: Panel Taps Kelley Drye as Lead Counsel --------------------------------------------------------- The official committee of unsecured creditors of HSF Holding, Inc., et al., asks the U.S. Bankruptcy Court for the District of Delaware for authority to employ Kelley Drye & Warren LLP as its lead counsel, nunc pro tunc to June 11, 2009. As the Committee's lead counsel, Kelley Drye will: a) advise the Committee with respect to its rights, duties and powers in these Chapter 11 cases; b) assist and advise the Committee in its consultations with the Debtors in connection with the administration of these Chapter 11 cases; and c) review the nature and validity of liens asserted against property of the Debtors and advise the Committee concerning the enforceability of such liens. Craig A. Wolfe, Esq., a member at Kelley Drye, assures the Court that the firm does not hold or represent any interest adverse to the Debtors' estates, and that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Wolfe says that Kelley Drye's current customary hourly rates are: Partners $550-$875 Of Counsel $480-$780 Special Counsel $400-$675 Associates $205-$520 Law Clerks $110-$195 Paraprofessionals $85-$285 Wilmington, Delaware-based HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high- speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The Company and its affiliate filed for Chapter 11 on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper Hamilton LLP represent the Debtors in their restructuring efforts. Adam Hiller, Esq., Brian Arban, Esq., and Michelle Berkeley-Ayres, Esq., at Atlantic Law, are the Committee's proposed local counsel. When the Debtors sought protection from their creditors, they listed between $100 million and $500 million each in assets and debts. HAWAII SUPERFERRY: Panel Wants Atlantic Law as Local Counsel ------------------------------------------------------------ The official committee of unsecured creditors of HSF Holding, Inc., et al., asks the U.S. Bankruptcy Court for the District of Delaware for authority to retain Atlantic Law Group, LLC as its local counsel, nunc pro tunc to July 17, 2009, to replace Draper & Goldberg, PLLC. Atlantic Law acquired substantially all of the assets of Draper & Goldberg, effective July 17, 2009. As the Committee's local counsel, Atlantic Law will: a) advise the Committee with respect to its rights, duties and powers in these Chapter 11 cases; b) assist and advise the Committee in its consultations with the Debtors in connection with the administration of these Chapter 11 cases; and c) review the nature and validity of liens asserted against property of the Debtors and advise the Committee concerning the enforceability of such liens. Adam Hiller, Esq., an associate at Atlantic Law, discloses that other than his former employment as an associate with Pepper Hamilton LLP, the Debtor's counsel, the firm and its professionals do not hold or represent any interest adverse to the Debtor or its estate, and that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Hiller says that the professionals and para-professionals of the firm who will have primary responsibility for the engagement and their hourly rates are: Adam Hiller, Esq. $275 Brian Arban, Esq. $250 Michelle Berkeley-Ayres, Esq. $250 Kevin Capuzzi $200 Cynthia Vernon $150 Katie Burritt $150 Olivia Lawson $45 Wilmington, Delaware-based HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high- speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The Company and its affiliate filed for Chapter 11 on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper Hamilton LLP represent the Debtors in their restructuring efforts. Craig A. Wolfe, Esq., at Kelley Drye & Warren LLP, is the Committee's proposed lead counsel. When the Debtors sought protection from their creditors, they listed between $100 million and $500 million each in assets and debts. HAYES LEMMERZ: Gets Court Approval to Move Ahead With Barnes' Suit ------------------------------------------------------------------ The Hon. Mary Walrath of the U.S. Bankruptcy Court for the District of Delaware granted Hayes Lemmerz International Inc.'s bid to move ahead with law firm Barnes & Thornburg LLP's suit over an allegedly unpaid bill, in which the auto supplier has filed a negligence counterclaim seeking more than $1 million in damages, according to Law360. Originally founded in 1908, Hayes Lemmerz International, Inc. (NasdaqGM: HAYZ) is a worldwide producer of aluminum and steel wheels for passenger cars and light trucks and of steel wheels for commercial trucks and trailers. The Company is also a supplier of automotive powertrain components. The Company has global operations with 23 facilities, including business, sales offices and manufacturing facilities, located in 12 countries around the world. The Company sells products to every major North American, Asian and European manufacturer of passenger cars and light trucks and to commercial highway vehicle customers throughout the world. The Company and certain affiliates filed for bankruptcy on May 11, 2009 (Bankr. D. Del. Case No. 09-11655) after reaching agreements with lenders holding a majority of the Company's secured debt. The Company's principal bankruptcy attorneys are Skadden, Arps, Slate, Meagher & Flom, LLP. Lazard Freres & Co., LLC, serves as the Company's financial advisors. AlixPartners, LLP, serves as the Company's restructuring advisors. The Garden City Group, Inc., serves as the Debtors' claims and notice agent. As of January 31, 2009, the Debtors had total assets of $1,336,600,000 and total debts of $1,405,200,000. This is the Company's second trip to the bankruptcy court, dubbed a Chapter 22, which was precipitated by an unprecedented slowdown in industry demand and a tightening of credit markets. The Company plans to reduce its debt and restructure its balance sheet. Hayes Lemmerz and its direct and indirect domestic subsidiaries and one subsidiary in Mexico first filed for bankruptcy in December 2001 before the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 filings were precipitated by declining market conditions and the Company's excessive debt burdens, according to Mr. Clawson, who also served as chairman and chief executive officer at that time. The Court confirmed the Company's reorganization plan in May 2003, allowing the Company to exit bankruptcy in June 2003. In accordance with the 2003 Plan, approximately $2.1 billion in pre-petition debt and other liabilities were discharged. The Plan provided for holders of prepetition secured claims to receive $478.5 million in cash and 53.1% of the reorganized company common stock. Holders of senior note claims were to receive $13 million in cash and 44.9% of the New Common Stock, and holders of general unsecured claims were to receive 2% of the New Common Stock. Hayes Lemmerz' prior common stock and securities were cancelled as of June 3, 2003. HAYES TENNESSEE: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Hayes Tennessee Venture, LLC 2410 Dr. F.E. Wright Drive Jackson, TN 38305 Bankruptcy Case No.: 09-13098 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Western District of Tennessee (Jackson) Judge: G. Harvey Boswell Debtor's Counsel: E. Franklin Childress Jr., Esq. Baker Donelson Bearman & Caldwell, PA 165 Madison Avenue, 20th Fl. Memphis, TN 38103 Tel: () 577-2147 Email: fchildress@bakerdonelson.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company says it does not have unsecured creditors who are non insiders when they filed their petition. The petition was signed by Thomas M. Ostrom, sole member and secretary of the Company. HCA INC: Moody's Assigns 'Ba3' Rating on $750 Million Senior Notes ------------------------------------------------------------------ Moody's Investors Service assigned a Ba3 (LGD3, 32%) rating to HCA Inc.'s proposed offering of $750 million of first lien senior secured notes. Moody's also affirmed the existing ratings of HCA, including the B2 Corporate Family and Probability of Default Ratings. The outlook for the ratings is stable. "The current transaction continues the company's efforts to proactively address the considerable amount of bank debt scheduled to mature in the 2012 and 2013 time frame," said Dean Diaz, Vice President -- Senior Credit Officer at Moody's. As such, the proposed issuance is not expected to result in any change in the company's leverage as the proceeds of the notes will be used to prepay a like amount of first lien bank debt. Additionally, while the current offering and the April 2009 issuance of secured notes is expected to increase interest expense, it is not expected to materially affect cash flow and interest coverage metrics. HCA's B2 Corporate Family Rating continues to reflect the significant leverage of the company resulting from the November 2006 leveraged buyout. The considerable interest cost associated with the debt load continues to constrain interest coverage metrics and limits free cash flow. The rating also reflects the anticipation that HCA's scale, market strength and recent focus on cost containment should aid in weathering the unfavorable trends in bad debt expense and weak volumes that have been and are expected to continue to plague the industry as a whole. Additionally, the company is expected to maintain good liquidity over the next year. Moody's rating actions are summarized below. Ratings assigned: * $750 million first lien secured notes due 2020, Ba3 (LGD3, 32%) Ratings affirmed: * $2,000 million ABL Revolver due 2012, Ba2 (LGD2, 12%) * $2,000 million Revolving Credit Facility due 2012, Ba3 (LGD3, 32%) * $2,750 million Term Loan A due 2012, Ba3 (LGD3, 32%) * $8,800 million Term Loan B due 2013, to Ba3 (LGD3, 32%) * $1,250 million Euro Term Loan due 2013, Ba3 (LGD2, 23%) * $1,500 million first lien secured notes due 2019, Ba3 (LGD3, 32%) * $1,000 million Second Lien Notes due 2014, B2 (LGD4, 57%) * $3,200 million Second Lien Notes due 2016, B2 (LGD4, 57%) * $1,500 million Second Lien PIK Notes due 2016, B2 (LGD4, 57%) Senior unsecured notes (various), Caa1 (LGD6, 90%) * Corporate Family Rating, B2 * Probability of Default Rating, B2 * Speculative Grade Liquidity Rating, SGL-2 Moody's last rating action was on April 14, 2009, when Moody's assigned a Ba3 rating to HCA's first lien senior secured notes offering and affirmed the existing ratings of the company. Headquartered in Nashville, Tennessee, HCA is the nation's largest acute care hospital company with 163 hospitals and 105 freestanding surgery centers (including eight hospitals and eight freestanding surgery centers that are accounted for using the equity method) as of June 30, 2009. For the twelve months ended June 30, 2009, the company recognized revenue in excess of $29 billion. HEADWATERS INC: S&P Downgrades Ratings on Convertible Notes to 'D' ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its issue-level rating on South Jordan, Utah-based Headwaters Inc.'s 2.875% convertible subordinated notes due 2016 to 'D' from 'CCC', and removed the rating from CreditWatch. The rating was originally placed on CreditWatch with negative implications on July 28, 2009; the CreditWatch status was revised to developing on July 30. The recovery rating remains '5' and is subject to review pending the successful completion of the company's proposed asset-based lending facility. S&P lowered the issue-level rating following Headwaters' announcement that it has completed an exchange of $19.8 million in principal of its 2.875% convertible senior subordinated notes due 2016 for 4.8 million shares of its common stock. The company offered the exchange at a 25% discount from the par value of the convertible notes. "Under S&P's criteria, S&P view an exchange offer at a discount to par by a company under substantial financial pressure as a distressed debt exchange and tantamount to a default," said Standard & Poor's credit analyst Tobias Crabtree. The company announced it has completed its planned convertible debt exchanges, resulting in a debt reduction of approximately $35 million. The corporate credit rating on Headwaters is 'CCC+' and it remains on CreditWatch with developing implications. Rating List Headwaters Inc. Corporate Credit Rating CCC+/Watch Dev/-- Rating Lowered To From -- ---- $91.6 Mil. Conv. Sub Notes Due 2016 D CCC/Watch Dev Recovery Rating 5 5 HOWARD GOLDSTEIN: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Joint Debtors: Howard Goldstein, Esq. Jody Goldstein fka Jody Lynn Holdeman 616 Chervil Valley Drive Las Vegas, NV 89138 Bankruptcy Case No.: 09-23861 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtors' Counsel: Charles T. Wright, Esq. Piet & Wright 3130 S. Rainbow Blvd., Suite 304 Las Vegas, NV 89146 Tel: (702) 566-1212 Fax: (702) 566-4833 Email: todd.wright@pietwright.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtors' petition, including a list of their 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/nvb09-23861.pdf The petition was signed by the Joint Debtors. HRP MYRTLE: Counsel to Get $1 Mil.; Unsec. Creditors Get Nothing ---------------------------------------------------------------- Court documents Paul, Hastings, Janofsky & Walker LLP will get $953,815 in compensation and $29,190 in expense reimbursement for its three and a half months of service for Hard Rock Park, while hundreds of unsecured creditors will go unpaid. Citing bankruptcy experts, Monique Newton at The Sun News reports that because no objections were filed to the application by early July, the money from the bankruptcy estate will flow to Hastings Janofsky and will be distributed to individual attorneys. Charleston School of Law professor Michael Dickey said that some of the Debtor's attorneys were paid more than $700 or $800 per hour for their services, The Sun News relates. The report quoted Mr. Dickey as saying, "The thing about hourly rates is that they tend to be regional or based on what market that attorney practices in. In New York, there are partners that have broken the $1,000 mark. For up there, those rates probably are not atypical." Andrew Marcus -- Tempus Marketing MB, LLC's chief operating officer and one of the committee of unsecured creditors' five members -- said that the committee, comprised of the five unsecured creditors that were owed the most money, was formed at the start of the bankruptcy, but dissolved once the Debtor moved from a reorganization to liquidation bankruptcy, The Sun News states. "Generally speaking, the unsecured creditors committee would've liked to see a reorganizational plan because there was a recognition that given the large amount of outstanding secured debt and bond debt as well as the overall economic climate in which this was happening, there would not be recovery for unsecured creditors in a liquidation context," the report quoted Mr. Marcus as saying. Based in Myrtle Beach, South Carolina, HRP Myrtle Beach Holdings, LLC, owned and operated Hard Rock Park, a rock-n-roll theme park in Myrtle Beach, South Carolina, under a long-term license agreement with Hard Rock Cafe International (USA), Inc. The Company and six of its affiliates filed for Chapter 11 protection on Sept. 24, 2008 (Bankr. D. Del. Lead Case No. 08-12193). Attorneys at Richards, Layton & Finger represented the Debtors as counsel. Attorneys at Dorsey & Whitney LLP represented the Official Committee of Unsecured Creditors. HRP said in its bankruptcy petition it had $100 million to $500 million in assets and debts. The Chapter 11 case was converted to liquidation proceedings under Chapter 7 in January 2009. IMPLANT SCIENCES: Amends 2008 Annual Report to Address SEC Issues ----------------------------------------------------------------- Implant Sciences Corporation filed with the Securities and Exchange Commission: 1. Amendment No. 4 on Form 10-K/A to amend its Annual Report on Form 10-K for the fiscal year ended June 30, 2008, originally filed on October 14, 2008. The Company filed Amendment No. 4 in response to certain comments made by the staff of the SEC. In response to the comments, the Company (i) amended Part II, Item 9A (Controls and Procedures) and (ii) filed currently dated certifications of its Chief Executive Officer and Chief Financial Officer, as required under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. See http://ResearchArchives.com/t/s?409d 2. Amendment No. 5 on Form 10-K/A to amend its Annual Report on Form 10-K for the fiscal year ended June 30, 2008, originally filed on October 14, 2008. The Company filed the Amendment No. 5 in response to certain comments made by the staff of the SEC. In response to the comments, the Company (i) amended Part II, Item 9A (Controls and Procedures) and (ii) filed currently dated certifications of its Chief Executive Officer and Chief Financial Officer. See http://ResearchArchives.com/t/s?409c According to the filings, the Company's management, with the participation of the Company's Chief Executive Officer and Chief Financial Officer, failed to complete its assessment of internal control over financial reporting and was unable to complete the evaluation as to the effectiveness of the Company's disclosure controls and procedures as of June 30, 2008. Based on the Company's inability to complete its assessment of internal control over financial reporting and conclude the evaluation of the Company's disclosure controls and procedures as of June 30, 2008, the Company's CEO and CFO concluded that, as of such date, the Company's disclosure controls and procedures were not effective. Subsequent to June 30, 2008, the Company: (i) dedicated internal and external staff to document and test internal controls, (ii) increased the oversight and training of the accounting staff in internal controls and (iii) commenced the process of drafting written policies and procedures. About Implant Sciences Wakefield, Massachusetts-based Implant Sciences Corporation (NYSE Alternext US: IMX) -- http://www.implantsciences.com/-- develops, manufactures and sells sophisticated sensors and systems for the Security, Safety and Defense industries. The Company has developed proprietary technologies used in its commercial portable and bench-top explosive trace detection systems which ship to a growing number of locations domestically and internationally. The Company had $8,296,000 in total assets and $16,112,000 in total liabilities resulting in $7,816,000 in stockholders' deficit at March 31, 2009. The Company had an accumulated deficit of approximately $70,224,000 and a working capital deficit of $7,088,000 as of March 31, 2009. Going Concern Doubt The Company has suffered recurring losses from operations and must repay in full the balance of its senior secured convertible promissory note on December 10, 2009. The promissory note was recorded at $3,741,000 as of March 31, 2009, and has a liquidation value of $4,600,000. The Company said these conditions raise substantial doubt about the Company's ability to continue as a going concern. UHY LLP on October 14, 2008, expressed substantial doubt about Implant Sciences' ability to continue as a going concern after auditing the company's consolidated financial statements for the fiscal year ended June 30, 2008, and 2007. The auditing firm pointed to the Company's recurring losses from operations. INDALEX HOLDINGS: Completes Sale to Sapa Holding ------------------------------------------------ Sapa Holding AB completed its acquisition of Indalex Holdings Finance Inc. on Monday, August 3, 2009. As reported by the Troubled Company Reporter on July 31, 2009, the Department of Justice reached a settlement that would require Sapa and Indalex to divest a North Carolina aluminum sheathing facility in order to proceed with Sapa's proposed $150 million acquisition of Indalex. The sale includes eleven active plants -- six in the U.S. and five in Canada -- with two cast houses and 29 presses. Indalex Holdings Corp., a wholly-owned subsidiary of Indalex Holdings Finance Inc., through its operating subsidiaries Indalex Inc. and Indalex Ltd., with headquarters in Lincolnshire, Illinois, is the second largest producer of soft alloy extrusion products in North America. The Company's aluminum extrusion products are widely used throughout industrial, commercial, and residential applications and are customized to meet specific end- user requirements. Indalex operates 10 extrusion facilities, 29 extrusion presses with circle sizes up to 20 inches, a variety of fabrication and close tolerance capabilities, two anodizing operations, two billet casting facilities, and six electrostatic paint lines, including powder coat capability. Indalex is indirectly controlled by private-equity investor Sun Capital Partners Inc. Sun Capital purchased Indalex in 2005 from Honeywell International Inc. for $425 million. Indalex is the 12th investment by Boca Raton, Florida-based Sun Capital to file in Chapter 11 since January 2006. Indalex Holdings and four affiliates filed for Chapter 11 on March 20 (Bankr. D. Del., Lead Case No. 09-10982). Donald J. Bowman, Jr., Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, has been tapped as counsel. Epiq Bankruptcy Solutions LLC is the claims and noticing agent. In its bankruptcy petition, Indalex listed assets of $356 million against debt totalling $456 million. As reported in the TCR on July 28, 2009, the Bankruptcy Court has authorized Indalex to sell its business to Sapa Holding AB. Sapa offered to pay (i) $90.1 million in cash and for the Debtors' U.S. assets; and (ii) $31.7 million in cash for the Canadian assets. ING CLARION: Fitch Affirms 'CSS2+' Special Servicer Rating ---------------------------------------------------------- Fitch Ratings affirms ING Clarion Capital Loan Services, LLC's commercial mortgage special servicer rating of 'CSS2+'. The rating is based on ING Clarion's highly experienced asset management team with strong workout backgrounds as well as their demonstrated ability to specially service nonperforming assets securing commercial mortgage-backed security transactions. The rating also reflects the financial strength and support of parent company, ING Group. As of June 30, 2009, ING Clarion was the named special servicer for 2,373 loans in 19 CMBS transactions totaling $27.2 billion. The company was actively specially servicing 96 loans and four real estate owned assets totaling $1.9 billion. Since inception, ING Clarion has resolved 54 CMBS loans totaling $753.7 million. INTERNATIONAL LEASE: Moody's Cuts Preferred Stock Rating to 'Ba2' ----------------------------------------------------------------- Moody's Investors Service downgraded the ratings of International Lease Finance Corp. (senior unsecured to Baa3 from Baa2, short- term to Prime-3 from Prime-2) and placed the ratings on review for further possible downgrade. The ratings downgrade reflects Moody's view that there is increased uncertainty regarding ILFC's long-term strategy for funding its $44 billion portfolio of commercial aircraft, assuming that the firm's planned divestiture by parent AIG is completed. ILFC has historically relied on access to the unsecured debt markets to meet much of its funding need, enabled by its solid operating performance and also by the implicit and demonstrated support of AIG. Unsecured bonds, notes and bank debt comprised 87% ($27.6 billion) of ILFC's total debt at the end of March. In recent quarters, a combination of factors has severely constrained ILFC's ability to issue new unsecured debt, including credit market contractions, the travails of AIG, and the ongoing efforts by AIG to sell ILFC. Though a sale of ILFC would eliminate the last two of these factors, Moody's believes that ILFC's future access to unsecured debt sources will likely be significantly diminished, notwithstanding a recovery in the debt markets and a transfer of company ownership. "We believe that ILFC, as a large monoline enterprise that relies upon wholesale funding, is particularly susceptible to capital market disruption," said Moody's analyst Mark Wasden. "Though ILFC's performance during the downturn has been resilient to date, Moody's view is that higher wholesale funding risks will require that ILFC transition to financing alternatives that could limit its financial flexibility when compared to traditional unsecured sources," added Wasden. Moody's said that ILFC's stand-alone characteristics are challenged by its funding risks, and this, in turn, puts pressure on its franchise position. Moody's expects that AIG will continue to provide needed capital support to the firm during the sales process. However, absent the support of AIG, ILFC would have a non-investment grade profile, in Moody's view. This change from an earlier view that ILFC had a Baa stand-alone profile is based primarily on Moody's increased concern regarding ILFC's uncertain future funding profile. During its review, Moody's will follow developments as AIG continues its efforts to divest ILFC. Moody's will also assess the implications of a sale for ILFC's operating and funding strategies and current creditor protections. Moody's will also analyze the potential effects on ILFC's earnings and capital position resulting from stresses on its customer base and asset values. The review will include a re-examination of the notching between ILFC's senior securities and its junior securities, with the possibility that the notching could widen. Should a sale of ILFC not appear to be forthcoming, Moody's will reconsider AIG's rationale for continuing to support ILFC, with negative consequences for ILFC's rating if the level of long-term support is seen as having weakened. Ratings affected by the action include: International Lease Finance Corp.: * Senior Unsecured: to Baa3 from Baa2 * Short-term: to Prime-3 from Prime-2 * Preferred Stock: to Ba2 from Ba1 ILFC E-Capital Trust I: * Preferred Stock: to Ba2 from Ba1 ILFC E-Capital Trust II: * Preferred Stock: to Ba2 from Ba1 In its last rating action on March 17, 2009, Moody's lowered ILFC's long-term rating to Baa2 from Baa1 and assigned a negative rating outlook. International Lease Finance Corporation, headquartered in Los Angeles, California, is a major owner-lessor of commercial aircraft. JAYAMPATH DHARMASURIYA: Section 341(a) Meeting Set for August 20 ---------------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of creditors in Jayampath P. Dharmasuriya's Chapter 11 case on August 20, 2009, at 11:00 a.m. The meeting will be held at 725 S Figueroa St., Room 2610, Los Angeles, California. 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. Rancho Palos Verdes, California-based Jayampath P. Dharmasuriya aka Jay Dhamasuiya Chapter 11 on July 20, 2009 (Bankr. C. D. Calif. Case No. 09-28606). William H. Brownstein, Esq., represents the Debtor in his restructuring efforts. In his petition, the Debtor listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in debts. JAYAMPATH DHARMASURIYA: US Trustee Wants to Convert Case to Ch. 7 ----------------------------------------------------------------- Peter C. Anderson, the U.S. Trustee for Region 16, asks the U.S. Bankruptcy Court for the Central District of California to dismiss or convert Jayampath P. Dharmasuriya's Chapter 11 case to a Chapter 7 case. The U.S. Trustee related that the Debtor failed to comply with the requirements of the Chapter 11 Notices and Guides, Bankruptcy Court and Local Bankruptcy Rules by failing to provide documents, financial reports or attend required meetings. The Court has set a hearing on the motion on Sept. 2, 2009, at 11:00 a.m. at Courtroom 1575, 255 E. Temple Street, Los Angeles, California. Objections, if any, are due 14 days prior to the hearing date. Rancho Palos Verdes, California-based Jayampath P. Dharmasuriya aka Jay Dhamasuiya Chapter 11 on July 20, 2009 (Bankr. C. D. Calif. Case No. 09-28606). William H. Brownstein, Esq., represents the Debtor in his restructuring efforts. In his petition, the Debtor listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in debts. JEVIC TRANSPORTATION: Sun Capital Can Remove Workers' Class Action ------------------------------------------------------------------ The Hon. Thomas Hardiman of the U.S. Court of Appeals for the Third Circuit ruled that the Class Action Fairness Act allows Sun Capital Partners Inc. to remove a class action filed by laid-off employees of trucking company Jevic Transportation Inc., which Sun owns, to federal court even though Jevic is bankrupt, reversing a decision by a district court, according to Law360. Based in Delanco, New Jersey, Jevic Transportation Inc. -- http://www.jevic.com/-- provides trucking services. The company has two units: Jevic Holding Corp. and Creek Road Properties. Neither of the units have assets nor operations. The company and its affiliates filed for Chapter 11 protection on May 20, 2008 (Bankr. D. Del. Case No. 08-11008). Domenic E. Pacitti, Esq., and Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg & Ellers, in Wilmington, Delaware, represent Jevic Transportation. The U.S. Trustee for Region 3 has appointed five creditors to serve on an Official Committee of Unsecured Creditors. Robert J. Feinstein, Esq., Bruce Grohsgal, Esq., and Maria A. Bove, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. Before filing for bankruptcy, the Debtors initiated an orderly wind-down process. As a part of the wind-down process, the Debtors have ceased substantially all of their business and terminated approximately 90% of their employees. The Debtors continue to manage the wind-down process in attempt to deliver all of the freight that is in their system and to retrieve their assets. When the Debtors filed for protection against their creditors, they listed assets and debts between $50 million and $100 million. As reported in the Troubled Company Reporter on January 3, 2009, The Company reported a net loss of $296,469 on $0 revenues for the month of September 2008. At September 30, 2008, the Company had total assets of $28,934,350, total liabilities of $36,188,467, and stockholders' deficit of $7,254,117. JOHN MCMILLAN: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: John R. McMillan 9704 Newport Coast Circle Las Vegas, NV 89147 Bankruptcy Case No.: 09-23887 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtor's Counsel: Laurel E. Davis, Esq. Fennemore Craig, P.C. 300 S. Fourth Street, #1400 Las Vegas, NV 89101 Tel: (702) 692-8000 Fax: (702) 692-8099 Email: ldavis@fclaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/nvb09-23887.pdf The petition was signed by Mr. McMillan. JOSE JUAN DIAZ ORTIZ: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Joint Debtors: Jose Juan Diaz Ortiz aka Professional Car Paint Julia Milagros De Leon-Perez PO Box 1331 Truillo Alto, PR 00977 Bankruptcy Case No.: 09-06375 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of Puerto Rico (Old San Juan) Debtors' Counsel: Lyssette A. Morales Vidal, Esq. Lyssete Moraleslaw Office 76 Calle Aquamarina Urb Villa Blanca Caguas, PR 00725-1908 Tel: (787) 746-2434 Email: lamoraleslawoffice@gmail.com Total Assets: $3,319,305 Total Debts: $1,935,394 The Debtors did not file a list of their 20 largest unsecured creditors when they filed their petition. The petition was signed by the Joint Debtors. KENNETH GWYNN: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Kenneth H. Gwynn Jessie C. Gwynn 1511 Serena Drive Myrtle Beach, SC 29579 Bankruptcy Case No.: 09-05652 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: David R. Duncan Debtors' Counsel: Michael H. Wells, Esq. Coastal Law, LLC 1314 Second Avenue Conway, SC 29526 Tel: (843) 488-5000 Email: mwells@coastal-law.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtors' petition, including a list of their 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/scb09-05652.pdf The petition was signed by the Joint Debtors. LA JOLLA: U.S. Trustee Sets Meeting of Creditors for August 18 -------------------------------------------------------------- The U.S. Trustee for Region 15 will convene a meeting of creditors in Bamboo Abbott, Inc.'s Chapter 11 case on August 18, 2009, at 3:00 p.m. The meeting will be held at the Office of the U.S. Trustee, 402 W. Broadway (use C St. entrance), Suite 630, San Diego, California. 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. Solana Beach, California-based La Jolla Networks, Inc., filed for Chapter 11 on July 17, 2009 (Bankr. S.D. Calif. Case No. 09- 10233). Kit J. Gardner, Esq., at the Law Offices of Kit J. Gardner represents the Debtor in its restructuring efforts. In its petition, the Debtor listed $50,000,001 to $100,000,000 in assets and $1,000,001 to $10,000,000 in debts. LANDMARK COMMUNITY: Loudoun Easterner Ceases Publication -------------------------------------------------------- The Loudoun Easterner has stopped publication. Loudoun Easterner posted on its Web site: "Effective today, July 22, 2009, we have suspended publication of the Loudoun Easterner. This was a difficult decision. We appreciate the years of reader, advertiser and employee loyalty to the publication." The Loudoun Easterner is a tabloid newspaper operating out of Ashburn. Landmark Community Newspapers operated the paper, which printed its first issue in 1968. LAS VEGAS SANDS: Moody's Reviews 'B3' Corp. Rating for Downgrade ---------------------------------------------------------------- Moody's Investors Service placed Las Vegas Sands, Corp.'s ratings, including its B3 Corporate Family Rating, on review for possible downgrade. The company's SGL-3 Speculative Grade Liquidity Rating was affirmed. The review for possible downgrade reflects LVSC's weak fiscal 2009 second quarter operating results and Moody's heightened concern regarding the company's ability to maintain an adequate liquidity profile, reduce leverage, and remain in compliance with its financial covenants. The review for downgrade also acknowledges that there is no definitive agreement or plan to sell non-core assets in Macau at this time. The sale of non-core assets is one of the three major components of LVSC's business plan and a potential significant source of additional near-term liquidity that, if successful, will allow the company to reduce a portion of its Macau subsidiary debt. Moody's review will focus on LVSC's ability to: (1) mitigate the impact to earnings from further revenue declines; (2) remain in compliance with financial covenants at its Las Vegas and Macau subsidiaries; and (3) raise the capital necessary to reduce its debt to more manageable levels. Consolidated debt/EBITDA currently exceeds 11 times and reflects a significant amount of debt-financed development activity. Ratings placed under review for possible downgrade (LGD rates subject to adjustment) are: Las Vegas Sands, Corp.: * Corporate Family Rating at B3 * Probability of Default Rating at B3 * $250 million 6.375% senior notes due 2015 at B3 (LGD 4, 50%) Venetian Casino Resort, LLC (and its co-issuer Las Vegas Sands, LLC): * $1 billion revolver expiring 2012 at B3 (LGD 4, 50%) * $3 billion term loan due 2014 at B3 (LGD 4, 50%) * $600 million delay draw term loan due 2014 at B3 (LGD 4, 50%) * $400 million delay draw term loan due 2013 at B3 (LGD 4, 50%) Venetian Macao Limited: * $700 million revolver expiring 2011 at B3 (LGD 4, 50%) * $1.8 billion term loan due 2013 at B3 (LGD 4, 50%) * $100 million term loan due 2011 at B3 (LGD 4, 50%) * $700 million delay draw term loan due 2012 at B3 (LGD 4, 50%) The previous rating action occurred on March 25, 2009, when Moody's commented that LVSC's announcement that it was in discussions with lenders regarding an amendment did not affect its ratings. Las Vegas Sands, Corp., owns and operates gaming and entertainment facilities in Las Vegas, NV, Bethlehem, PA, and Macao, China. The company is also developing a gaming and entertainment complex in Singapore. The company generates consolidated annual net revenues of about $4.3 billion. LRC BATTERY CREEK: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: LRC Battery Creek, LLC 2138 Rounte 522 Selinsgrove, PA 17870 Case No.: 09-05663 Type of Business: The Debtor operates a real estate business. Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: Chief Judge John E. Waites Debtor's Counsel: G. William McCarthy Jr., Esq. 1715 Pickens St. (29201) PO Box 11332 Columbia, SC 29211-1332 Tel: (803) 771-8836 Email: bmccarthy@mccarthy-lawfirm.com Total Assets: $16,881,382 Total Debts: $9,299,236 The petition was signed by Gary L. Grossman, the company's president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Beaufort County Treasurer $81,366 Fenton Tile Company LLC $26,798 Hagemeyer $24,626 Sailer Stone and Stucco LP $22,675 Pool Design Group Inc. $17,000 Perfect Square Construction $14,802 LLC Dupriest Construction $14,120 Co Inc Elevator Lift Systems Inc $13,500 Newkirk Environmental Inc $11,864 Buist Byars and Taylor LLC $9,491 Thompson Landscaping $8,641 Beaufort Jasper Water and $6,295 Sewer Authority Calibogue Enterprises $4,864 SCE and G $4,783 Play Serious Home $4,584 Technology Palmetto Fence Co Inc $4,395 Carolina Engineering $3,083 Consultants Inc JD Painting Services $2,750 Gale Contractor Services $2,700 Spark Chasers Electrical $2,355 Contracting LYONDELL CHEMICAL: Reaches Stipulation on Palms Action ------------------------------------------------------ In September 2007, Aaron and Tisha Palms filed an action in the 164th Judicial District Court of Harris County, Texas, against Debtors Lyondell Chemical Company and Houston Refining, LP as co- defendants, seeking compensation for injuries allegedly sustained by Mr. Palms at a Houston Refining refinery in February 2007, while working with his employer, Technical Automation Services. Technical Automation has agreed to indemnify Houston Refining, but not Lyondell for costs arising from the Palms Action. Against this backdrop, the Debtors sought and obtained the Court's approval of a stipulation it entered into with the Palmses modifying the automatic stay to permit (i) the parties to mediate the Palms Action; and (ii) the Palmses to dismiss one of the Debtors from the Palms Action, and to pursue the Palms Action 90 days after approval of the Stipulation. The parties further agreed that: (1) the automatic stay will remain in full force and effect with respect to any effort to enforce or collect any liquidated claim from Houston Refining or any other Debtor. (2) the Palmses will dismiss Lyondell as a co-defendant in the Palms Action. Christopher R. Mirick, Esq., at Cadwalader, Wickersham & Taft LLP, told the Court that dismissal of Lyondell from the Palms Action will help the Debtors' estates avoid costs and expenses in connection with their defense as co-defendant in the Palm Action. Moreover, he noted that the Court lacks jurisdiction to liquidate the Palms' personal injury claims. He also noted that Technical Automation's agreement to indemnify Houston Refining for defense costs provides the Debtors' creditors additional protection against any potential effort by the Palmses to seek recovery from the Debtors' estates. Since the Palmses will need to return to the Bankruptcy Court to recover from the assets of Houston Refining or any other Debtor, even if a judgment against Houston Refining is obtained, there will be no risk to the Debtors' estate assets from allowing the Palms Action to proceed, he assured the Court. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately $8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a $6.5 billion term loan, which comprises a $3.25 billion in new loans and a $3.25 billion roll-up of existing loans; and a $1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LYONDELL CHEMICAL: Sees September 30 Shutdown of Chocolate Bayou ---------------------------------------------------------------- To recall, Lyondell Chemical Co. and its affiliates filed with the Bankruptcy Court their motion to (i) shut down and demolish their polymers production facility known as Chocolate Bayou polymers plant in Brazoria County, Texas; and (ii) reduce the workforce at the Facility, effective July 31, 2009. The Debtors note that since their filing of the Motion to Shut Down, they have re- evaluated the amount of time necessary to transition customers to Clinton, Iowa; and Matagorda, Texas sites in a safe and orderly manner. By this amended motion, the Debtors seek the Court's authority to (i) shut down the Facility, and to subsequently demolish the Facility; and (ii) eliminate 50 jobs at the Facility on or after September 30, 2009. Although the Debtors intend to demolish the Facility, they continue to explore ways to maximize the value of the Facility for their estates. If they obtain a viable offer from a third party for the purchase of the Facility prior to the Court approval of their Amended Motion, the Debtors may not demolish the Facility. Judge Gerber will consider the Debtors' Amended Motion on August 11, 2009. Objections are due August 7. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately $8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a $6.5 billion term loan, which comprises a $3.25 billion in new loans and a $3.25 billion roll-up of existing loans; and a $1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MAGNACHIP SEMICONDUCTOR: May Now Send Plan to Creditors ------------------------------------------------------- MagnaChip Semiconductor LLC won approval from the U.S. Bankruptcy Court for the District of Delaware of the disclosure statement explaining its proposed Chapter 11 plan of liquidation, Carla Main at Bloomberg News said. With the approval of the Disclosure Statement, MagnaChip, which has sold most of its assets, may now send the Plan to creditors for voting. The Plan sets forth the proposed treatment of claims and interest. According to the Disclosure Statement, holders of claims and interests would receive: Estimated Creditor Class Treatment of Claims Recovery -------------- ------------------- -------- First Lien Payment from most 70.6% Lenders Owed of the proceeds $95 Million of the sale Second Lien Noteholders Payment from the $1 million 0.2% owed about allocated to unsec. Creditors $500 million and noteholders Unsec. Creditors Payment from the $1 million 0.1% Owed $3.2 million allocated to unsec. creditors and noteholders. The 0.1% recovery by unsecured creditors is contingent on their support of the plan. Unsecured creditors would get nothing if they vote to reject the plan. The official committee of unsecured creditors previously said that it is rejecting the plan and said that the Debtor should pursue a plan with better terms. According to Bloomberg, the Bankruptcy Court scheduled an Aug. 3 hearing to consider terminating MagnaChip's exclusive period to propose a plan. If exclusivity is terminated, the Creditors Committee and other stakeholders could pursue their own plan for MagnaChip. About MagnaChip Semiconductor Headquartered in South Korea, MagnaChip Semiconductor LLC -- http://www.magnachip.com/-- is a leading, Asia-based designer and manufacturer of analog and mixed-signal semiconductor products for high volume consumer applications. The Company has a broad range of analog and mixed-signal semiconductor technology and intellectual property, supported by its 29-year operating history, large portfolio of registered and pending patents and extensive engineering and manufacturing process expertise. Citigroup Venture Capital Equity Partners LP was part of the investor group that acquired MagnaChip in 2004 from Hynix Semiconductor Inc. MagnaChip Semiconductor S.A. and five other entities filed for Chapter 11 on June 12, 2009, in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 cases are jointly administered under Case No. 09-12008, MagnaChip Semiconductor Finance Company. Judge Peter J. Walsh handles the case. Curtis A. Hehn, Esq., James E. O'Neill, Esq., Laura Davis Jones, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtors as counsel. Howard A. Cohen, Esq., at Drinker Biddle & Reath serves as counsel for the official committee of unsecured creditors. Omni Management Group LLC is the Debtors' claims agent. In its petition, Magnachip Semiconductor Finance Company listed assets below $50,000 and debts of more than $1 billion. In their formal schedules, MagnaChip Semiconductor S.A. disclosed $951,917,782 in assets against $845,903,186 in debts while MagnaChip Semiconductor B.V. disclosed assets of $762,465,739 against debts of $1,800,612,084. MARK DESJEAN: Case Summary & 19 Largest Unsecured Creditors ----------------------------------------------------------- Joint Debtors: Mark S. Desjean aka Mark Desjean aka Mark Steven Desjean Robbie Lyn Desjean aka Robbie-Lyn Desjean P.O. Box 23344 Hilton Head Island, SC 29925 Bankruptcy Case No.: 09-05673 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: Chief Judge John E. Waites Debtors' Counsel: Michael W. Mogil, Esq. 303 Professional Building Hilton Head Island, SC 29928 Tel: (843) 785-8110 Fax: (843) 785-9676 Email: mwmogil@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtors' petition, including a list of their 19 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/scb09-05673.pdf The petition was signed by the Joint Debtors. MAX LANG: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------ Debtor: Max Lang 237 Lafayette Street, Apt. 3E New York, NY 10012 Bankruptcy Case No.: 09-14810 Chapter 11 Petition Date: July 31, 2009 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Eric J. Snyder, Esq. Siller Wilk 675 Third Avenue, 9th Floor New York, NY 10017 Tel: (212) 421-2233 Fax: (212) 752-6380 Email: esnyder@sillerwilk.com Total Assets: $703,479 Total Debts: $2,138,593 A list of the Company's 6 largest unsecured creditors is available for free at: http://bankrupt.com/misc/nysb09-14810.pdf The petition was signed by Mr. Lang. MEADOW INDEMNITY: Voluntary Chapter 15 Case Summary --------------------------------------------------- Chapter 15 Petitioner: The Meadow Indemnity Company Limited Chapter 15 Debtor: The Meadow Indemnity Company Limited PO Box 33 Maison Trinity St. Peter Port Guernsey GY1 4AT United Kingdom Chapter 15 Case No.: 09-08706 Chapter 15 Petition Date: July 31, 2009 Court: Middle District of Tennessee Judge: Keith M Lundin Chapter 15 Petitioner's Counsel: Barbara Dale Holmes, Esq. Harwe Howard Hyne Gabbert & Manner P.C. 315 Deaderick Street, Ste. 1800 Nashville, TN 37238 Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million About the Meadow Indemnity Company The Meadow Indemnity Company Limited was formed on April 29, 1976 in St. Peter, Port, Guernsey, Channel Islands as an insurance and reinsurance company. It was a wholly owned subsidiary of Gould, Inc. whose headquarters were in Chicago in the state of Illinois, USA. Initially, the Company participated only in insuring and reinsuring its parent's property and casualty activities, but in 1978 it began to participate in external reinsurance risks. The Company's book of business included Aviation, Casualty, Financial, Marine, Non-Marine, Multi-Line, Professional Indemnity and Property accounts. The majority of these accounts were underwritten through the London market. In early 1991, the Company ceased underwriting new reinsurance business and began the process of settling its outstanding insurance claims (went into run-off), which is still ongoing today. The Meadows Indemnity Company Limited has reached with creditors a solvent scheme of arrangement with the High Court of Justice of England and Wales. Proofs of claim by former brokers and policyholders are due January 2010. MERCER INT'L: Posts EUR11.4 Million Net Loss for Q2 2009 -------------------------------------------------------- Mercer International Inc. reported a net loss of EUR11.4 million during the three months ended June 30, 2009, compared to a net income of EUR4.30 million during the same period last year. Mercer reported a net loss of EUR60.0 million during the six months ended June 30, 2009, compared with a net income of EUR3.9 million during the same period last year. As at June 30, 2009, the Company had EUR1.10 billion in total assets and EUR1.02 billion in total liabilities. As at June 30, 2009, the Company's cash and cash equivalents were EUR62.1 million, compared to EUR42.5 million at the end of 2008 and it had working capital of EUR80.2 million compared with EUR154.4 million at the end of 2008. The Company also had EUR3.5 million of restricted cash in the debt service reserve account under the Stendal Loan Facility compared to EUR13.0 million at December 31, 2008. The Stendal Loan Facility is provided by a syndicate of 11 financial institutions and the Celgar Loan Facility and Rosenthal Loan Facility are each provided by one financial institution. The Company has not to date experienced any reductions in credit availability with respect to the loan facilities. However, if any of the financial institutions were to default on their commitment to fund, it could be adversely affected. During the second quarter the Company negotiated the refinancing of the Rosenthal Loan Facility, which matures in February 2010, with a new EUR25.0 million replacement revolving facility set to mature in December 2012 and a four-year amortizing EUR4.4 million term loan. Subject to customary conditions, the Company currently expects to finalize both the New Rosenthal Facility and the Rosenthal Term Loan in the third quarter. In July 2009, the Company commenced an exchange offer for any and all outstanding 8.5% convertible senior subordinated notes which mature in October 2010. Under the terms of the Exchange Offer the Company is offering to exchange each $1,000 principal amount of the Convertible Notes for (i) 129 shares of common stock; (ii) a premium of $200 in principal amount of new 3% convertible senior subordinated notes due 2012; and (iii) accrued and unpaid interest. Unless extended, the Exchange Offer will expire on August 11, 2009. Approximately $67.3 million was outstanding under the old notes at March 31, 2009. Jimmy S.H. Lee, President and Chairman, stated, "While global economies remain in recession and pulp prices were generally weak, we saw a stabilizing trend during the latter part of the quarter as record restocking by Chinese buyers and production downtime throughout the industry helped reduce global pulp inventories from peak levels earlier in the year. The Pulp and Paper Products Council recently reported that world pulp producer inventories for bleached softwood kraft pulp have fallen to approximately 26 days. List prices also improved in most markets in the quarter with the NBSK price in Europe rising from a low of $580 per ADMT in April to $630 per ADMT at the end of June. Additionally, producers have announced further price increases of about $70 per ADMT for July and August, bringing the NBSK price in Europe to $700 per ADMT. Offsetting this upward movement however has been the weakening of the U.S. dollar which decreased by about 5.4% and 7.8% versus the Euro and Canadian dollar, respectively, during the quarter." Mr. Lee continued, "In June the Canadian government announced a C$1 billion aid program aimed at supporting energy efficiency and environmental performance capital programs at Canadian pulp and paper mills. The amount of funding is to be based upon the quantity of black liquor produced by a mill in 2009. Although no specific rules for the program have been released, we currently believe that our Celgar mill will be eligible for significant capital expenditure grants and thus are reviewing the mill's various energy and environmental initiatives, including the "green" energy project, with a view to realizing on the opportunities under the program." Mr. Lee added, "Earlier this month we commenced an exchange offer for our outstanding 8.5% convertible notes to improve our capital structure by reducing our debt and interest expense levels. In the quarter we also negotiated the refinancing of the revolving working capital facility of our Rosenthal mill which matures in February 2010, with a new EUR25.0 million replacement revolving facility set to mature in December 2012 and a four-year amortizing EUR4.4 million term loan. Subject to customary conditions, we currently expect to finalize both the new loan facility and the term loan sometime in the third quarter." Mr. Lee concluded, "We currently believe that maintenance of inventories at the present lower levels will be key to further price recovery in the second half of the year and into 2010 and that additional production downtime by producers will be required as demand from China levels off." A full-text copy of the Company's earnings report is available at no charge at http://ResearchArchives.com/t/s?4091 Mercer International Inc., a Washington-based corporation with corporate offices in Vancouver, British Columbia, is a global producer of NBSK pulp. Moody's ratings cover the Restricted Group, which includes the Celgar and Rosenthal pulp mills but excludes the Stendal mill. Annual production capacity of the Restricted Group is approximately 820,000 ADMTs (air-dried metric tones) and revenue for the 12 months ended March 31, 2009, was EUR391 million. * * * As reported by the Troubled Company Reporter on June 26, 2009, Moody's Investors Service downgraded the credit ratings of the Restricted Group of Mercer International Inc., while concurrently placing the ratings on review for possible further downgrade. The Corporate Family Rating and Probability of Default Rating were lowered to Caa1 from B2, the rating on the senior unsecured notes was lowered to Caa2 from B2 and the Speculative Grade Liquidity Rating was lowered to SGL-4 from SGL-3. The TCR said July 16, 2009, Standard & Poor's Ratings Services lowered its corporate credit rating and issue-level rating on Mercer International. S&P lowered the corporate credit rating to 'CC' from 'B-' and lowered the rating on the senior unsecured debt to 'CC' from 'B-'. The rating outlook is negative. MERISANT WORLDWIDE: Court Orders Appointment of Fee Examiner ------------------------------------------------------------ At the behest of Merisant Worldwide Inc., Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware directed the appointment of a fee examiner and established procedures for paying the professionals who do work for the debtor, Carla Main at Bloomberg News reported. According to the report, the order also permits the examiner to establish procedures for considering fee applications by the professionals. About Merisant Worldwide Headquartered in Chicago, Illinois, Merisant Worldwide Inc. -- http://www.merisant.com/-- sells low-calorie tabletop sweetener. The Debtor's brands are Equal(R) and Canderel(R). The Debtor has principal regional offices in Mexico City, Mexico; Neuchatel, Switzerland; Paris, France; and Singapore. In addition, the Debtor owns and operates manufacturing facilities in Manteno, Illinois, and Zarate, Argentina, and own processing lines that are operated exclusively for the Debtor at plants located in Bergisch and Stendal, Germany and Bangkrason, Thailand. As of March 28, 2008, the Debtor has 20 active direct and indirect subsidiaries, including five subsidiaries in the United States, six subsidiaries in Europe, five subsidiaries in Mexico, Central America and South America, and three subsidiaries in the Asia Pacific region, including Australia and India. Furthermore, the Debtor's Swiss subsidiary holds a 50% interest in a joint venture in the Philippines. Merisant Worldwide holds 100% interest in Merisant Company. Merisant Worldwide and five of its units filed for Chapter 11 protection on January 9, 2009 (Bankr. D. Del. Lead Case No. 09-10059). Sidley Austin LLP represents the Debtors in their restructuring efforts. Young, Conaway, Stargatt & Taylor LLP represents the Debtors' as co-counsel. Blackstone Advisory Services LLP is the Debtors' financial advisor. Epiq Bankruptcy Solutions, LLC, is the Debtors' Claims and Noticing Agent. Winston & Strawn LLP represents the official committee of unsecured creditors as counsel. Ashby & Geddes, P.A., is the Committee's Delaware counsel. The Debtors had US$331,077,041 in total assets and US$560,742,486 in total debts as of November 30, 2008. MGM MIRAGE: Swings to $212.5 Million Net Loss in Q2 2009 -------------------------------------------------------- MGM MIRAGE reported a net loss of $212.5 million for the three months ended June 30, 2009, compared to a net income of $113.1 million in the prior year second quarter. MGM MIRAGE reported a net loss of $107.3 million for the six months ended June 30, 2009, compared to a net income of $231.4 million during the same period a year ago. The current year result was impacted by non-cash impairment charges of $188 million, or $0.34 per diluted share net of tax, primarily related to the Company's investment in a convertible note. The Company also recorded losses on the retirement of long- term debt of $58 million primarily related to the redemption of senior debentures required to permit the Company's recent secured note issuances -- an impact of $0.11 per diluted share net of tax. During the second quarter the Company secured funding for the completion of CityCenter, issued $1.15 billion of equity through an offering of common stock, issued $1.5 billion of senior secured notes, and secured key amendments to its senior credit facility. "This has been a monumental quarter for us, as the significant capital market transactions and other corporate finance activities meaningfully improved our financial position," said Jim Murren, MGM MIRAGE Chairman and Chief Executive Officer. "Perhaps as important, we saw a more stabilized -- though still difficult -- operating environment in the second quarter. Our operating teams are focused on continuing to sequentially increase cash flow and our CityCenter team is driving towards completion and opening of CityCenter. We believe CityCenter will invigorate the Las Vegas market and be a key component of the future growth of MGM MIRAGE." At June 30, 2009, the Company had $22.4 billion in total assets, including $1.07 billion in total current assets; $1.23 billion in total current liabilities, $3.58 billion in deferred income taxes, $12.3 billion in long-term debt, $186.7 million in other long-term obligations; and $5.04 billion in stockholders' equity. MGM MIRAGE said the $2.65 billion of debt and equity issuances, completed in the second quarter, significantly improved the Company's financial position. Also, in conjunction with the transactions the Company secured a long-term amendment to its senior credit facility. The amendment to the senior credit facility permanently waived prior non-compliance with financial covenants and amended the financial covenants to provide for minimum EBITDA and maximum annual capital expenditure tests, replacing the previous leverage and interest coverage tests. A portion of the net proceeds from the issuance of the senior secured notes and common stock were used to permanently repay approximately $826 million under the senior credit facility. The Company also redeemed all of its 7.25% senior debentures due 2017 for $127 million, and repurchased $885 million of its senior notes due 2009 through a public tender offer. At June 30, 2009, the Company had approximately $4.1 billion of borrowings outstanding under its senior credit facility with available borrowings of $1.5 billion; total long-term debt was $12.3 billion, down $1.1 billion from December 31, 2008. The Company's cash balance was $411 million at June 30, 2009. During the second quarter of 2009 the Company made capital investments of approximately $33 million. In addition, the Company funded $294 million for its portion of the remaining equity contributions to CityCenter which included $224 million in the form of an irrevocable letter of credit, of which $88 million remained to be drawn as of June 30, 2009. "Our ability to access the capital markets in the second quarter is a testament to our operating strength as well as the incredible demonstration of support our stakeholders have in our Company, our properties and our employees," said Mr. D'Arrigo. "We will continue to evaluate additional strategies to further enhance our financial position." As reported by the Troubled Company Reporter on June 24, 2009, MGM MIRAGE has concluded that there is no longer substantial doubt about its ability to continue as a going concern as a result of a series of transactions it executed in May 2009 to improve its financial condition. The report of Deloitte & Touche, LLP, MGM MIRAGE's independent registered public accounting firm on the Company's consolidated financial statements for the year ended December 31, 2008, contains an explanatory paragraph with respect to the Company's ability to continue as a going concern. On May 19, 2009, as reported by the TCR, MGM MIRAGE completed a public offering of 164.5 million shares of its common stock at $7 per share, with proceeds of roughly $1.1 billion. In addition, the Company launched a private placement of senior secured notes; $650 million of 10.375% senior secured notes due May 2014 and $850 million of 11.125% senior secured notes due November 2017. In conjunction with the transactions, the company entered into Amendment No. 6 and waiver to its senior credit facility, which required the Company to: 1) permanently repay $826 million of the credit facility, and 2) treat the $400 million in aggregate repayment of the credit facility borrowings made as a condition to Amendment No. 2 and Amendment No. 5 as a permanent prepayment of the credit facility borrowings. About MGM MIRAGE Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) -- http://www.mgmmirage.com/-- is a hotel and gaming company. It owns and operates 17 properties located in Nevada, Mississippi and Michigan, and has investments in three other properties in Nevada, New Jersey and Illinois. * * * As reported by the Troubled Company Reporter on May 20, 2009, Standard & Poor's Ratings Services raised its corporate credit ratings on MGM MIRAGE and its subsidiaries to 'CCC+' from 'CCC', reflecting the substantial boost to MGM MIRAGE's intermediate-term liquidity profile provided by the recent $2.5 billion capital raise (prior to any over-allotments on the equity offering). S&P also removed all ratings from CreditWatch, where they were placed with positive implications on May 13, 2009, following MGM MIRAGE's announced plans to raise at least $2.5 billion of capital. The rating outlook is developing. The TCR said May 15 that Moody's Investors Service affirmed MGM MIRAGE's Caa2 Corporate Family Rating and Caa3 Probability of Default Rating following the company's announcement it intends to issue $1.0 of new common equity and $1.5 billion of new senior secured notes. A B1 rating was assigned to the proposed $1.5 billion senior secured guaranteed notes. MGM has an SGL-4 Speculative Grade Liquidity rating and a negative rating outlook. MICHAEL SIZEMORE: Voluntary Chapter 11 Case Summary --------------------------------------------------- Joint Debtors: Michael T. Sizemore dba S & S Investments GP Trina S. Sizemore P.O. Box 159 Eads, TN 38028 Bankruptcy Case No.: 09-28290 Chapter 11 Petition Date: August 1, 2009 Court: United States Bankruptcy Court Western District of Tennessee (Memphis) Judge: David S. Kennedy Debtors' Counsel: Russell W. Savory, Esq. 88 Union Avenue, 14th Floor Memphis, TN 38103 Tel: (901) 523-1110 Email: russell.savory@gwsblaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtors did not file a list of their 20 largest unsecured creditors when they filed their petition. The petition was signed by the Joint Debtors. MILLENNIUM TRANSIT: Court Transfers Case to Judge James Starzynski ------------------------------------------------------------------ The Honorable Mark B. McFeelley of the U.S. Bankruptcy Court for the District of New Mexico ordered on July 24, 2009, the transfer of Millennium Transit Services, LLC's bankruptcy case to the Honorable James S. Starzynski in the interest of facilitating its administration. Roswel, New Mexico-based Millennium Transit Services LLC is a bus manufacturer. The Company filed for Chapter 11 relief on August 29, 2008 (Bankr. D. N.M. Case No. 08-12848). David T. Thuma, Esq., at Jacobvitz, Thuma & Walker, represents the Debtor as counsel. George M. Moore, Esq., at Moore, Berkson & Gandarilla, P.C., represents the official committee of unsecured creditors as counsel. When the Debtor filed for protection from its creditors, it listed between $10 million and $50 million each in assets and debts. MORRIS PUBLISHING: Lenders Cut Revolving Loan Commitment to $60MM ----------------------------------------------------------------- Morris Publishing Group, LLC, as borrower, on July 31, 2009, entered into Amendment No. 6 and Waiver No. 9 with JPMorgan Chase Bank, N.A. as Administrative Agent under the parties' Credit Agreement dated as of December 14, 2005, as amended. Additional parties to the Waiver include the subsidiary guarantors of Morris Publishing, Morris Communications, MPG Newspaper Holding, LLC, the parent of Morris Publishing, Shivers Trading & Operating Company, the parent of MPG Holding, and Morris Communications Holding Company, LLC, the parent of Morris Communications. The lenders party to the Credit Agreement are JPMorgan Chase Bank, N.A., The Bank of New York, SunTrust Bank, Wachovia Bank, N.A., Bank of America, N.A., General Electric Capital Corporation, Allied Irish Banks, P.L.C., RBS Citizens, N.A., Comerica Bank, US Bank, National Association, First Tennessee Bank, National Association, Webster Bank, National Association, Keybank National Association, Sumitomo Mitsui Banking Corporation, and Mizuho Corporate Bank, Ltd. The Credit Agreement includes an event of default if Morris Publishing defaults in the payment when due of any principal or interest due on any other indebtedness having an aggregate principal amount of $5,000,000 or more -- such as Morris Publishing's $278,478,000 of 7% Senior Subordinated Notes due 2013. Morris Publishing failed to pay the $9,746,730 interest payment due February 1, 2009 on the Notes. Waiver No. 9 waives any default that arose from the failure to make such interest payment and any default that may arise from the failure to make the $9,746,730 interest payment due August 3, 2009, on the Notes until 5:00 p.m. New York City time on August 14. However, the waiver will terminate earlier if Amendment No. 6 to the Forbearance Agreement is terminated or amended prior to such time or upon other defaults. In addition, Waiver No. 9 permanently reduced the Revolving Credit Commitment to $60,000,000. Waiver No. 9 also waives until August 14 any event of default that may have occurred consisting solely of the consolidated cash flow ratio of Morris Communications and Morris Publishing exceeding the applicable amount permitted under Section 6.06(a) of the Credit Agreement. Also on July 31, Morris Publishing and Morris Publishing Finance Co., as issuers, and all other subsidiaries of Morris Publishing, as subsidiary guarantors, entered into Amendment No. 6 to the Forbearance Agreement dated as of February 26, 2009, with respect to the indenture relating to the Notes between the issuers, the subsidiary guarantors and US Bank Trust, N.A. (as successor to Wachovia Bank, N.A.), as Indenture Trustee, dated as of August 7, 2003. Morris Publishing failed to pay the $9,746,730 interest payment due February 1, 2009 on the Notes and anticipated that it would fail to pay the $9,746,730 interest payment due August 3. Pursuant to the Forbearance Agreement, the holders, their investment advisors or managers of over $226,000,000 of outstanding principal amount of the Notes -- over 80% of the outstanding Notes -- agreed not to take any action during the forbearance period as a result of the Payment Defaults to enforce any of the rights and remedies available to the Holders or the Indenture Trustee under the Indenture or the Notes, including any action to accelerate, or join in any request for acceleration of, the Notes. The Holders also agreed to request that the Indenture Trustee not take any such remedial action with respect to the Payment Defaults, including any action to accelerate the Notes during the Forbearance Period. Under the Amendment No. 6, the "Forbearance Period" generally means the period ending at 5:00 p.m. EDT on August 14, but could be terminated earlier for various reasons set forth in the Forbearance Agreement including if the lenders under the Credit Agreement accelerate the maturity of the obligations under the Credit Agreement, if Waiver No. 9 is terminated, upon the occurrence of any other default under the Indenture, or if Morris Publishing files for bankruptcy protection or breaches its covenants under the Forbearance Agreement. The lenders party to the Credit Agreement also agreed to waive until August 14 the cross default arising from the overdue interest payments on the senior subordinated notes. Morris Publishing Group, LLC -- http://www.morris.com/-- is a privately held media company based in Augusta, Ga. Morris Publishing currently owns and operates 13 daily newspapers as well as nondaily newspapers, city magazines and free community publications in the Southeast, Midwest, Southwest and Alaska. MPG PARKLAND: Case Summary & 18 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: MPG Parkland, LTD 1803 Briar Creek Blvd. Safety Harbor, FL 34695 Bankruptcy Case No.: 09-16990 Chapter 11 Petition Date: August 2, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Joel S. Treuhaft, Esq. Joel S. Treuhaft Law Offices 2656 West Lake Road Palm Harbor, FL 34684 Tel: (727) 797-7799 Fax: (727) 230-9518 Email: jstreuhaft@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A full-text copy of the Debtor's petition, including a list of its 18 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-16990.pdf The petition was signed by Giorgio Vallar. NORTH MIAMI: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: North Miami Shopping Center Venture dba 127th Street Shopping Center 1803 Briar Creek Blvd Clearwater, FL 33759 Case No.: 09-16991 Chapter 11 Petition Date: August 2, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Joel S Treuhaft, Esq. Joel S. Treuhaft Law Offices 2656 West Lake Road Palm Harbor, FL 34684 Tel: (727) 797-7799 Fax: (727230-9518 Email: jstreuhaft@yahoo.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Giorgio Vallar, the company's treasurer. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Della Porta Ward & Assoc $6,294 Fisher & Associates Inc $11,999 Florida Power & Light Co Utilities $624 Fortin Leavy Skiles Inc $4,885 G Batista & Associates $5,000 Gateway Building & Design $185,574 3091 SE Jay St Stuart, FL 34997 Gene H Bieber Architect Inc $2,500 Gordon B Certain Trust Ground Rent $31,250 (Quarterly) Landamerica Live Resp Team $500 Lawrence Turner Quarterly Ground $15,625 Rent Miami Dade Co Tax Collector Real Estate Taxes $362 NAI Miami $250,644 9655 S Dixie Hwy Ste 200 Miami, FL 33156 National Construction Rental $816 Pertnoy Solowsky & Allen PA $12,674 Richard Turner Ground Rent- $15,625 Quarterly Ruden McClosky $16,714 Tampa Reprographics & Supply $306 Tropical Realty Appraisal Sv $6,000 Waste Management-Dade Co Services $357 Wingerter Laboratories Inc $1,231 OPUS WEST: Asks for Injunction Against Utilities ------------------------------------------------ The Opus West Corp. and its affiliates ask the Bankruptcy Court to (i) prohibit utility providers from altering, refusing, or discontinuing service; (ii) deem Utility Providers adequately assured of future performance; and (iii) establish procedures for determining adequate assurance of payments. Section 366(a) of the Bankruptcy Code prevents utility companies from discontinuing, altering, or refusing service to a debtor during the first 30 days of a Chapter 11 case. Upon expiration of that period, a utility provider cannot terminate its services if a debtor has furnished "adequate assurance of payment" within the meaning of Section 366(c)(l)(A). Clifton R. Jessup, Jr., Esq., at Greenberg Traurig LLP, in Dallas, Texas, contends that uninterrupted utility services are essential to the business operations of the Opus West Debtors and the preservation of their estates and assets. The Debtors' aggregate average monthly cost for Utility Services is approximately $128,947, according to Mr. Jessup. He says that the Debtors have a long and established payment history with all of the Utility Providers. Recognizing the right of the Utility Providers to evaluate the proposed adequate assurance on a case-by-case basis, the Opus West Debtors propose to adopt these procedures: a. As adequate assurance, the Debtors will deposit within 15 days after entry of an interim order, in a single separate escrow account for the benefit of all Utility Providers, an amount equal to the approximate aggregate cost of two weeks of Utility Services provided by the Utility Providers, based on the average cost of the Utility Services over the last 12 months. The Debtors estimate the total Adequate Assurance Deposit will not exceed $64,473. All of the Debtors' Utility Providers will be deemed to have received adequate assurance of payment, as that term is used under Section 366. b. If a Utility Provider is not satisfied with the assurance of future payment provided by the Debtors, the Utility Provider must serve a written request on the Debtors setting forth the locations for which Utility Services are provided, the account numbers for the locations, the outstanding balance for each account, a summary of the Debtors' payment history on each account, and an explanation of why the Adequate Assurance Deposit is inadequate assurance of payment. Additionally, the Utility Provider may seek further relief from the Court in order to receive further adequate assurance. c. A Utility Provider may not alter, discontinue, or refuse further service to the Debtors until and unless the Utility Provider receives authorization from the Court. d. If at any time during the postpetition period, the Debtors fail to pay a regularly billed utility payment invoiced postpetition by any Utility Provider, the Utility Provider will provide the Debtors and their bankruptcy counsel written notice of the failure outlining the location and account number for which the postpetition payment is due as well as the amount of the missed payment. After five business days from the date of receipt of the written notice by both the Debtors and their bankruptcy counsel, the Utility Provider will have the right to receive payment in an amount equal to the Adequate Assurance Deposit allocated for the Utility Provider. If, during the Cure Period, the Utility Provider is paid by the Debtors an amount that cures the missed Postpetition Utility Payment, then the Utility Provider will not have the right to draw on its Adequate Assurance Deposit with regard to the payment. e. Any Utility Provider claiming that the Debtors have failed to pay a Postpetition Utility Payment will be restrained from discontinuing, altering, or refusing service to the Debtors on account of unpaid charges for prepetition or postpetition services or the Debtors' bankruptcy filing until after the Utility Provider receives its Adequate Assurance Deposit, and the Debtors fail to make a subsequent Postpetition Utility Payment. f. At any time, the Debtors may terminate service from any of the Utility Providers, the termination being effective immediately upon the Debtors' notice to the Utility Provider. At that time, Debtors will no longer be required to make any more payments to the Utility Provider for any services provided after the termination and any excess will be returned. A list of the Opus West Debtors' Utility Providers and their adequate assurance amounts is available for free at: http://bankrupt.com/misc/OpWUtilities.pdf Mr. Jessup tells the Court that although the Debtors have made an extensive and good faith effort to identify all the Utility Providers, certain Utility Providers may not be on the current List. To the extent the Opus West Debtors identify additional Utility Providers, they will promptly file amendments to the Utility Provider List. Following the Debtors' filing and service of an amendment to the Utility Provider List, the Debtors propose that the newly identified Utility Providers will have 20 days to serve an Additional Assurance Request. Southern California Responds Southern California Edison Company, a utility provider, objected to the Debtors' request, but subsequently withdrew the objection because the Debtors confirmed that they have no accounts with Southern California. Accordingly, Southern California's counsels, Creel Sussman & Moore LLP and Russel R. Johnson III PLC, filed a notice of withdrawal in the Debtors' bankruptcy cases. Court Enters Interim Order The Court grants the Debtors' request, on an interim basis. All Utility Providers are prohibited from discontinuing, altering, or refusing service to the Debtors on account of any unpaid prepetition charges, or discriminating against the Debtors as a result of the Debtors' bankruptcy filing or any outstanding prepetition invoices. The Debtors are directed to fund the Adequate Assurance Deposit no later than August 12, 2009. A final hearing on the Debtors' request will be held on August 5, 2009, at 3:00 p.m. About Opus West Corporation Based in Phoenix, Arizona, Opus West Corporation is a full-service real estate development firm that focuses on acquiring, constructing, operating, managing, leasing and/or disposing of real estate development projects primarily located in the western United States. Opus West and its affiliates filed for Chapter 11 on July 6, 2009 (Bankr. N.D. Tex. Case No. 09-34356). Clifton R. Jessup, Jr., at Greenberg Traurig, LLP, represents the Debtors in their restructuring efforts. Franklin Skierski Lovall Hayward, LLP, is co-counsel to the Debtors. Pronske & Patel, P.C. is conflicts counsel. Chatham Financial Corp. is financial advisor. BMC Group is the Company's claims and notice agent. As of May 31, Opus West -- together with its non-debtor affiliates -- had $1,275,334,000 in assets against $1,462,328,000 in debts. In its bankruptcy petition, Opus West said it had assets and debts both ranging from $100 million to $500 million. Opus West joins affiliates that previously filed for bankruptcy. Opus East LLC, a real estate operator from Rockville, Maryland, commenced a Chapter 7 liquidation on July 1 in Delaware. Opus South Corp., a Florida condominium developer based in Atlanta, filed a Chapter 11 petition April 22 in Delaware. OPUS WEST: Presents Bonus Program for Critical Employees -------------------------------------------------------- Opus West Corp. and its affiliates ask the Court to approve a bonus program for certain of their remaining critical employees, through and including October 31, 2009. Clifton R. Jessup, Jr., Esq., at Greenberg Traurig LLP, in Dallas, Texas, relates that over the past year, the Debtors have gradually reduced their employee levels from approximately 400 employees one year ago to 37 employees as of the Petition Date. He reveals that about 21 of the Debtors' remaining employees are believed to be critical to the Debtors' operations during the Chapter 11 cases for at least the next four months. The Critical Employees consist of 15 employees in the accounting and information technology department, two employees in the legal department, two in the sales and finance department, and two administrative employees. Mr. Jessup says that the Critical Employees perform a variety of functions and services necessary for the Debtors to continue to operate postpetition and to maximize the value of their assets for the benefit of their creditors. Among other things, the Employees: (a) collect receivables and other amounts owed to the Debtors, (b) process and pay accounts payable and other expenses, (c) comply with various financial, accounting and other reporting requirements, (d) process and prepare various tax returns, (e) maintain information networks and desktop support, (f) handle various legal matters, (g) work with the Debtors' professionals and consultants, (h) assist in the sale or other disposition of the Debtors' assets, including various due diligence and information gathering activities, and (i) perform a number of bookkeeping, office and administrative services relating to Debtors' businesses and operations. The Debtors have adopted an Employee Bonus Program that is designed to retain and incentivize the Critical Employees. Mr. Jessup says that the Bonus Program for Non-Insider Critical Employees is designed primarily as a retention bonus plan, while the Bonus Program for the Insider Critical Employees is designed primarily as a performance-based incentive bonus plan. The Debtors believe that 20 of the 21 Critical Employees are not "insiders" as the term is defined under Section 101(31) of the Bankruptcy Code. Claire Janssen, the Debtors' Chief Financial Officer, a Critical Employee of the Debtors, may qualify as an "insider" of the Debtors. The Debtors estimate that under the Bonus Program, they will pay approximately $60,000 to $65,000 in retention bonuses each month to the Non-insider Critical Employees. With respect to the performance bonus for the Debtors' Chief Financial Officer, the CFO may qualify for a monthly performance bonus of up to $7,916. The maximum cost of the Bonus Program for the four-month period is approximately $280,000. Mr. Jessup relates that the amount of the monthly bonus for the CFO will be determined by John Greer, a representative of the Debtors' Chief Restructuring Officer, based on an evaluation of the CFO's work during that month using a performance criteria. Mr. Greer is not a participant in the Bonus Program and is otherwise disinterested and able to render a fair and impartial evaluation of the CFO's monthly performance, Mr. Jessup assures the Court. Any performance bonus that is earned by the CFO during any given month would be earned and payable as of the last day of that month. Mr. Jessup asserts that the Bonus Program will help improve employee morale, which currently is very low in light of the significant reductions in force over the past year, unpaid bonuses earned prior to the bankruptcy, the pending termination of their jobs at the end of the Chapter 11 cases as well as the added pressure, uncertainty and responsibility resulting from the filing of the Chapter 11 cases. Since it is likely that some of the Critical Employees will need to be retained beyond October 31, 2009, the Debtors also ask the Court that their request be without prejudice to their right to seek an extension of the Bonus Program as may be necessary. About Opus West Corporation Based in Phoenix, Arizona, Opus West Corporation is a full-service real estate development firm that focuses on acquiring, constructing, operating, managing, leasing and/or disposing of real estate development projects primarily located in the western United States. Opus West and its affiliates filed for Chapter 11 on July 6, 2009 (Bankr. N.D. Tex. Case No. 09-34356). Clifton R. Jessup, Jr., at Greenberg Traurig, LLP, represents the Debtors in their restructuring efforts. Franklin Skierski Lovall Hayward, LLP, is co-counsel to the Debtors. Pronske & Patel, P.C. is conflicts counsel. Chatham Financial Corp. is financial advisor. BMC Group is the Company's claims and notice agent. As of May 31, Opus West -- together with its non-debtor affiliates -- had $1,275,334,000 in assets against $1,462,328,000 in debts. In its bankruptcy petition, Opus West said it had assets and debts both ranging from $100 million to $500 million. Opus West joins affiliates that previously filed for bankruptcy. Opus East LLC, a real estate operator from Rockville, Maryland, commenced a Chapter 7 liquidation on July 1 in Delaware. Opus South Corp., a Florida condominium developer based in Atlanta, filed a Chapter 11 petition April 22 in Delaware. OPUS WEST: Proposes to Pay Prepetition Employee Wages ----------------------------------------------------- Opus West Corp. and its affiliates ask the Bankruptcy Court for authority to reimburse certain prepetition employee business expenses and pay postpetition severance amounts. In addition, the Debtors ask the Court to enter an order directing all banks to honor their prepetition checks or electronic transfers for the reimbursement of business expenses, and prohibiting banks from placing any holds on, or attempting to reverse, any automatic transfers on account of the payment of business expenses. Certain Employees may be owed prepetition business expenses, including business expense reimbursement checks issued by the Debtors prior to the Petition Date, but which did not clear with the banks for whatever reason prior to the Petition Date. Currently, the Debtors believe that two employees are owed reimbursement for Business Expenses amounting $3,288. The Debtors seek the Court's authority to reimburse employees for Business Expenses incurred prior to the Petition Date in an amount not to exceed $5,000. According to Clifton R. Jessup, Jr., Esq., at Greenberg Traurig LLP, in Dallas, Texas, the Debtors need to pay and reimburse their current employees and independent contractors because the employees and contractors allow the Debtors to: (a) maintain their real estate development projects; (b) continue operations; (c) minimize the personal hardship the Employees may suffer if prepetition business expenses are not reimbursed as expected; and (d) maintain morale and ensure that the Debtors have adequate staffing. The Debtors note that they also need the Court's approval of the payment of severance amounts paid on the July 15, 2009 payroll amounting to $11,861 for severance due to employees that were terminated before the Petition Date. Mr. Jessup contends that the Severance Payments were made in the ordinary course of their businesses and thus, may not need the Court's approval. Nevertheless, out of an abundance of caution, the Debtors are disclosing that the Severance Payments were made and are seeking the Court's approval for them. The Severance Payments, Mr. Jessup maintains, represent a small amount of money in comparison to the total size of the Debtors' estates and will cause no material harm to the Debtors' estates or their creditors. About Opus West Corporation Based in Phoenix, Arizona, Opus West Corporation is a full-service real estate development firm that focuses on acquiring, constructing, operating, managing, leasing and/or disposing of real estate development projects primarily located in the western United States. Opus West and its affiliates filed for Chapter 11 on July 6, 2009 (Bankr. N.D. Tex. Case No. 09-34356). Clifton R. Jessup, Jr., at Greenberg Traurig, LLP, represents the Debtors in their restructuring efforts. Franklin Skierski Lovall Hayward, LLP, is co-counsel to the Debtors. Pronske & Patel, P.C. is conflicts counsel. Chatham Financial Corp. is financial advisor. BMC Group is the Company's claims and notice agent. As of May 31, Opus West -- together with its non-debtor affiliates -- had $1,275,334,000 in assets against $1,462,328,000 in debts. In its bankruptcy petition, Opus West said it had assets and debts both ranging from $100 million to $500 million. Opus West joins affiliates that previously filed for bankruptcy. Opus East LLC, a real estate operator from Rockville, Maryland, commenced a Chapter 7 liquidation on July 1 in Delaware. Opus South Corp., a Florida condominium developer based in Atlanta, filed a Chapter 11 petition April 22 in Delaware. OWENS CORNING: Delaware Unit's 1st Quarter 2009 Summary Report -------------------------------------------------------------- Mark, W. Mayer, vice president and chief accounting officer of Owens Corning Delaware, submitted to the Office of the U.S. Trustee a post-confirmation summary report for the first quarter ended March 31, 2009. Owens Corning Delaware Case No. 00-3837 Post-Confirmation Report For Quarter Ended March 31, 2009 Cash, beginning of period $15,816,000 Total receipts received by Debtor: Cash sales 0 Accounts receivable 963,426,000 Proceeds from litigation 0 Sale of Debtor's assets 0 Capital infusion under Plan 0 --------------- Total cash received 963,426,000 --------------- Total cash available 979,242,000 Less disbursement made by Debtor: Disbursements made under Plan 2,440,000 Disbursement made for administrative claims 899,000 Other disbursements 973,418,000 --------------- Total disbursements 976,757,000 --------------- Cash, at end of period $2,485,000 =============== The Chapter 11 cases of the other Owens Corning affiliates have been closed, Case Nos. 00-3838 through 00-3854. About Owens Corning Headquartered in Toledo, Ohio, Owens Corning fka Owens Corning (Reorganized) Inc. (NYSE: OC) -- http://www.owenscorning.com/-- is a producer of residential and commercial building materials and glass fiber reinforcements, and other similar materials for composite systems. The Company has operations in 26 countries. The Company filed for chapter 11 protection on October 5, 2000 (Bankr. D. Del. Case. No. 00-03837). Norman L. Pernick, Esq., at Saul Ewing LLP, represented the Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Official Committee of Asbestos Creditors. James J. McMonagle served as the Legal Representative for Future Claimants until June 20, 2007. Mr. McMonagle was replaced by Michael J. Crames. Mr. Crames served as Mr. McMonagle's counsel until July 2005, when he retired from the law firm Kaye Scholer LLP. On September 28, 2006, the Honorable John P. Fullam, Sr., of the U.S. District Court for the Eastern District of Pennsylvania affirmed the order of Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware confirming Owens Corning's Sixth Amended Plan of Reorganization. The Plan took effect on October 31, 2006, marking the company's emergence from Chapter 11. Reorganized Owens sought on July 25, 2008, from the Delaware Bankruptcy Court a final decree closing the Chapter 11 cases of 17 of its affiliates. Only the Chapter 11 case of Owens Corning Sales, LLC, formerly known as Owens Corning, under Case No. 00-03837 will remain open. (Owens Corning Bankruptcy News; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) OWENS CORNING: Judge Fitzgerald Resets Omnibus Hearing to Sept. 22 ------------------------------------------------------------------ In light of the G-20 Summit to be held in Pittsburg, Pennsylvania, on September 24 to 25, 2009, Judge Fitzgerald has reset the Omnibus Hearing date in Owens Corning's case to September 22. Judge Fitzgerald has reset the schedule in view of the travel restrictions into and out of Pittsburg before and after the Summit. About Owens Corning Headquartered in Toledo, Ohio, Owens Corning fka Owens Corning (Reorganized) Inc. (NYSE: OC) -- http://www.owenscorning.com/-- is a producer of residential and commercial building materials and glass fiber reinforcements, and other similar materials for composite systems. The Company has operations in 26 countries. The Company filed for chapter 11 protection on October 5, 2000 (Bankr. D. Del. Case. No. 00-03837). Norman L. Pernick, Esq., at Saul Ewing LLP, represented the Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Official Committee of Asbestos Creditors. James J. McMonagle served as the Legal Representative for Future Claimants until June 20, 2007. Mr. McMonagle was replaced by Michael J. Crames. Mr. Crames served as Mr. McMonagle's counsel until July 2005, when he retired from the law firm Kaye Scholer LLP. On September 28, 2006, the Honorable John P. Fullam, Sr., of the U.S. District Court for the Eastern District of Pennsylvania affirmed the order of Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware confirming Owens Corning's Sixth Amended Plan of Reorganization. The Plan took effect on October 31, 2006, marking the company's emergence from Chapter 11. Reorganized Owens sought on July 25, 2008, from the Delaware Bankruptcy Court a final decree closing the Chapter 11 cases of 17 of its affiliates. Only the Chapter 11 case of Owens Corning Sales, LLC, formerly known as Owens Corning, under Case No. 00-03837 will remain open. (Owens Corning Bankruptcy News; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) PACIFIC CAPITAL: $363 Mil. Loss Cues Moody's to Junk Issuer Rating ------------------------------------------------------------------ Moody's Investors Service downgraded the ratings of Pacific Capital Bancorp (issuer rating to Caa1 from Ba1) and its subsidiary, Pacific Capital Bank, N.A. (long-term bank deposits to B1 from Baa3; bank financial strength rating to E+ from D+). Pacific Capital Bank, N.A.'s short-term ratings were downgraded to Not Prime from Prime-3. The long-term ratings remain on review for possible downgrade. Moody's said that the multi-notch downgrade reflects its opinion that given the likely credit costs in Pacific Capital's real estate lending portfolios and inability to tax effect losses, there is a risk of the firm becoming undercapitalized without external capital raising. The downgrade follows Pacific Capital's announcement of a $363 million loss for the second quarter of 2009. This loss was largely driven by $194 million of loan loss provision, a $129 million impairment of goodwill, and $26 million of tax expense resulting from a valuation allowance against the company's deferred tax asset. With this charge, the valuation allowance is equal to the full amount of Pacific Capital's DTA. This signals that from a tax perspective, the company may not produce sufficient income in future periods to utilize its current losses. As a result, the depletion of the company's capital base will be greater than initially anticipated because of its inability to recognize tax benefit from ongoing losses. Additionally, although the rating agency had expected that credit provisions would be elevated for several periods, limiting the company's ability to internally generate capital from its core regional banking business, the second quarter provision and resulting net loss was higher than expected. The second quarter results also demonstrated that noninterest expenses (excluding nonrecurring items such as the goodwill impairment and FDIC special assessment) are increasing rapidly, offsetting the modestly improving revenue. Moody's believes that Pacific Capital's tax business, which provides Refund Anticipation Loans and Refund Transfers, could continue to make positive contributions to earnings. However, the regulatory agreement, along with the large funding requirements of this business, could lead to changes that will limit the tax business' earnings contribution and alter the company's earnings mix. The rating agency said that ratings remain under review pending the outcome of Pacific Capital's review of its strategic alternatives, as well as its ability to meet its higher regulatory capital requirements at the bank level. As expected, Pacific Capital Bank, N.A., did not achieve the OCC target for Tier 1 leverage. The ratio was 5.6% as of June 30, 2009, compared to the target of 8.5%. It did meet the Total risk-based capital ratio of 11%. The bank is also required to achieve ratios of Tier 1 Leverage and Total RBC of 9% and 12%, respectively, by September 30, 2009. Moody's believes that meeting September 30 targets will be even more challenging, given the substantial erosion of equity in the recent quarter and the company's low stock price. The last rating action was on June 22, 2009 when Moody's downgraded the bank's financial strength rating to D+ from C and long term deposits to Baa3 from A3. Following the downgrade, the ratings were placed on review for possible further downgrade. Pacific Capital Bancorporation, which is headquartered in Santa Barbara, CA, reported total assets of $7.3 billion as of June 30, 2009. Downgrades: Issuer: Pacific Capital Bancorp -- Issuer Rating, Downgraded to Caa1 from Ba1 Issuer: Pacific Capital Bank, N.A. -- Bank Financial Strength Rating, Downgraded to E+ from D+ -- Issuer Rating, Downgraded to a range of B2 to NP from a range of Baa3 to P-3 -- OSO Rating, Downgraded to NP from P-3 -- Deposit Rating, Downgraded to NP from P-3 -- OSO Senior Unsecured OSO Rating, Downgraded to B2 from Baa3 -- Senior Unsecured Deposit Rating, Downgraded to B1 from Baa3 PATRIOT HOMES: To Auction Texas and Indiana Properties ------------------------------------------------------ Patriot Homes, Inc., et al., ask the U.S. Bankruptcy Court for the Northern District of Indiana to approve bid procedures for the sale of the Debtor's real property commonly known as 1001 W. Loop 340, Waco, Texas 76712 and 104400 County Road 2, Midlebury, Indiana 46540, including the payment of break-up fees of $25,000 to the stalking horse bidders in the event that the stalking horse bidders are not the winning bidders for the properties. Prior to the petition date, the Texas Property and the Indiana Property had housed the Debtors' manufacturing facilities. ABDI Family Trust has offered to purchase the Texas Property for $2,250,000, while BR Properties LLC has offered $1,500,000 for the Indiana Property. As proposed, competing bids are due no later than August 21. Initial overbid for the Texas Property will be at least $2,300,000 while initial overbid for the Indiana Property will be at least $1,550,000. If necessary, an auction for the Texas Property will be held on August 25, 2009, at 10:00 a.m., at Coldwell Banker Commercial, 500 N. Valle Mills Dr., Waco, Texas 76710, while an auction for the Indiana Property will be held on August 26, 2009, at 1:30 p.m., at Meridian Title, 405 South Second street, Elkhart, Indiana 46516. After the conclusion of the respective auctions, the Debtors will submit the sales order to the Court for approval without further motion, to save on additional costs. Additionally, the Debtors request that they be authorized to "reimplement" the bidding procedures in the event that either of these proposed sales are not consummated, subject to the prior consent of both Wells Fargo Business Credit, which holds the mortgages on the properties, and the official committee of unsecured creditors. Headquartered in Middlebury, Indiana, Patriot Homes, Inc. -- http://www.patriothomes.com/-- makes modular houses. The Debtor and 7 of its debtor-affiliates filed separate motions for Chapter 11 relief on September 28, 2008 (Bankr. N.D. Ind. Lead Case No. 08-33347). Paul F. Donahue, Esq., Sven T. Nylen, Esq., at K&L Gates LLP. serve as counsel. Rebecca Hoyt Fisher, Esq., at Laderer & Fischer, represents the official committee of unsecured creditors as counsel. In its schedules, Patriot Homes disclosed total assets of $1,715,900 and total debts of $17,918,377. PATRIOT HOMES: Wants DIP Termination Date Extended to August 28 --------------------------------------------------------------- Patriot Homes, Inc., et al., ask the U.S. Bankruptcy Court for the Northern District of Indiana to extend for the seventh consecutive four-week period its final order, dated October 16, 2008, granting authority to obtain secured credit, to use cash collateral, and to use advances from Wells Fargo Bank, National Association, beyond its current termination date of May 29, 2009, through and including August 28, 2009. The Debtors intend to use the funds to pay wages, utilities, and other necessary expenses of preserving and liquidating the collateral, in accordance with a budget covering the period of June 5, 2009, through the termination date. As of the Petition Date, Debtors are obligated to lender in the aggregate principal amount of $8,673,652, secured by substantially all of the assets and properties of the Debtors (other than Patriot General, Inc., and Patriot Mfg. Limited, Inc.). As adequate protection for the use of cash collateral and as security for the post-petition advances, Wells Fargo will have a superpriority claim and a postpetition prior and paramount security interest in all of the Debtors' (a) existing and future personal property, and (b) real property, subject to a "carve-out" for professional fees. Other creditors that may claim an interest in the Debtors' cash collateral will also be granted replacement liens. All prepetition collateral will secure all prepetition and postpetiton debt and obligations of the Debtors to lender, and all prepetition cash collateral may be applied by lender, at its sole discretion, to the prepetition or postpetition debts and obligations of Debtors to it. A copy of the four-week DIP budget is available for free at: http://bankrupt.com/misc/patriothomes.4-weekDIPbudget.pdf Headquartered in Middlebury, Indiana, Patriot Homes, Inc. -- http://www.patriothomes.com/-- makes modular houses. The Debtor and 7 of its debtor-affiliates filed separate motions for Chapter 11 relief on Sept. 28, 2008 (Bankr. N.D. Ind. Lead Case No. 08-33347). Paul F. Donahue, Esq., Sven T. Nylen, Esq., at K&L Gates LLP. serves as counsel. Rebecca Hoyt Fisher, Esq., at Laderer & Fischer, represents the official committee of unsecured creditors as counsel. In its schedules, Patriot Homes disclosed total assets of $1,715,900 and total debts of $17,918,377. PEOPLE AGAINST DRUGS: Thompson & Knight Replaces Strasburger ------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas has granted People Against Drugs Affordable Housing Agency permission to employ Thompson & Knight as special counsel, retroactive to May 15, 2009. Thompson & Knight replaces Strasburger Price LLP, whose employment was terminated. The Court approved the termination of Strasburger effective May 15. As special counsel, TK will advise and represent the Debtor with respect to the IRS audit, provide federal tax advice in connection with the IRS disputes regarding employment taxes and Form 990, and provide state non-profit law advice. TK will also assist in the implementation of the Debtor's plan of reorganization, as it relates to tax exempt status and non-profit status. Thompson & Knight's hourly rates are: David Rosenberg, Esq. $500 Tyree Collier, Esq. $425 Kara Blanco, Esq. $270 David M. Rosenberg, Esq., a partner at Thompson & Knight, assured the Court that the firm does not hold any interest materially adverse to the interest of the Debtor's estate or to any class of creditors, by reason of any direct or indirect relationship to, connection with, or interest in the Debtor. Garland, Texas-based People Against Drugs Affordable Public Housing Agency -- http://www.peopleagainstdrugs.org/-- is a nonprofit charitable corporation which was formed in 1991, and acquired a certificate of authority to do business in Texas in 1992. The Debtor owns an apartment complex, Country Creek Apartments, located in Garland, Texas. Country Creek has 296 apartment units and offers sliding scale rents depending on the tenant's income. County Creek Apartments are managed by Pace Realty Corporation. Until February 2009, the Company offered transitional housing for individuals in recovery from addictions, also providing them with the transportation needed to work, buy medification and foods, and attend important appointments that would enable them to start rebuilding their lives. The funds for these operations were derived from the profit realized upon the operation of Country Creek Apartments. The Company filed for Chapter 11 protection on September 17, 2008 (Bankr. N.D. Tex. Case No. 08-34696). Christina Walton Stephenson, Esq., Gerrit M. Pronske, Esq., Rakhee V. Patel, Esq., and Vickie L. Driver, Esq., at Pronske & Patel, P.C., represent the Debtor as counsel. In its schedules, the Debtor listed total assets of $12,516,289 and total debts of $12,615,708. PHOENIX WORLDWIDE: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Phoenix Worldwide Industries, Inc., filed with the U.S. Bankruptcy Court for the Southern District of Florida its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $5,500,000 B. Personal Property $23,659,697 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $8,986,111 E. Creditors Holding Unsecured Priority Claims $950,255 F. Creditors Holding Unsecured Non-priority Claims $4,630,568 ----------- ----------- TOTAL $29,159,697 $14,566,935 A copy of the Debtor's SAL is available at: http://bankrupt.com/misc/phoenixworldwide.SAL.pdf Miami, Florida-based Phoenix Worldwide Industries, Inc. -- http://www.phoenixworldwide.com/-- dba Phoenix Worldwide Industries, Inc., develops surveillance technologies for government and law enforcement agencies. The Company filed for Chapter 11 on June 29, 2009 (Bankr. S.D. Fla. Case No. 09-23201). Jeffrey P. Bast, Esq., at Bast Amron LLP, represents the Debtor in its restructuring efforts. According to the Chapter 11 petition, the Debtor has assets and debts both ranging from $10 million to $50 million. PLIANT CORP: Reaches Deal with Apollo on Chapter 11 Plan -------------------------------------------------------- Pliant Corp. creditors reached an agreement that allows the bankrupt plastics maker to be taken over by Apollo Management LP, according to Steven Church of Bloomberg News. Bloomberg News relates that representatives Apollo, Pliant, and its lenders announced the deal on July 31 after signing papers in the courthouse hallway in Wilmington, Delaware. Under the settlement, bondholders will get $100 million plus a six-year note for $250 million guaranteed by Pliant's assets, bondholder attorney Kristopher Hansen told Judge Mary Walrath. The deal is backed by Pliant's management. The Apollo plan will now be backed by Pliant and the bondholders, a Pliant attorney said. As reported by the Troubled Company Reporter on July 14, 2009, Apollo Management VI, L.P., and Pliant's management have filed proposed Chapter 11 plants that have been sent to creditors for voting. The Apollo Plan provides that: -- The First Lien Notes secured claims receive $89 million in cash and $236.4 million of new senior secured notes to be issued pursuant to the Plan; -- The remaining balances of the Debtor's First Lien Notes and the Debtors Second Lien Notes will receive, in respect of each $1000 of allowed claims, at the Holder's option either $87.50 in cash and $87.50 in liquidation preference of new preferred stock if such holder elects to receive cash and new preferred stock or if such holder does not make an election on the ballot, or a pro rata share of the Rights allocation if such holder elects to receive Rights; -- General unsecured claims will be paid $0.175 on the dollar in cash; -- The Debtors' DIP facility claims and prepetition credit facility claims will be paid in full in cash; and -- Claims and interests of Pliant's existing equity holders will be extinguished. Pliant's plan provides for (i) payment of $393 million in first- lien notes with all of the new stock of reorganized Pliant, (ii) recovery by other creditors, including the holders of $262 million in second-lien notes, with warrants to buy new stock. Pliant earlier amended its plan to beef up recovery for unsecured creditors: Estimated Estimated Recovery Recovery Under 1st Under 2nd Type of Claim Amended Plan Amended Plan ------------- ------------ ------------ Priority Non-Tax 100% 100% Other Secured 100% 100% Prepetition Credit 100% 100% Facility First Lien Notes 50.1% 40.5%-58.1 Unsecured Claims 0.5% 3%-6.3% Convenience Class 100% 100% Senior Subordinated Notes 0.5% 0% Subsidiary Interests 100% 100% About Pliant Headquartered in Schaumburg, Illinois, Pliant Corporation produces polymer-based films and flexible packaging products for food, beverage, personal care, medical, agricultural and industrial applications. The Company has operations in Australia, New Zealand, Germany, and Mexico. Pliant and 10 of its affiliates filed for Chapter 11 protection on January 3, 2006 (Bankr. D. Del. Lead Case No. 06-10001). James F. Conlan, Esq., at Sidley Austin LLP, and Edmon L. Morton, Esq., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, represented the Debtors in their restructuring efforts. The Debtors tapped McMillan Binch Mendelsohn LLP, as Canadian counsel. As of September 30, 2005, the Company had $604.3 million in total assets and $1.19 billion in total debts. The Debtors emerged from Chapter 11 on July 19, 2006. Pliant Corp. and its affiliates again filed for Chapter 11 after reaching terms of a pre-packaged restructuring plan. The voluntary petitions were filed February 11, 2009 (Bank. D. Del. Case Nos. 09-10443 through 09-10451). The Hon. Mary F. Walrath presides over the cases. Jessica C.K. Boelter, Esq., at Sidley Austin LLP, in Chicago, Illinois, and Edmon L. Morton, Esq., at Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, provide bankruptcy counsel to the Debtors. Epiq Bankruptcy Solutions LLC acts as claims and noticing agent. The U.S. Trustee for Region 3 appointed five creditors to serve on an official committee of unsecured creditors. The Creditors Committee selected Lowenstein Sandler PC as its counsel. As of September 30, 2008, the Debtors had $688.6 million in total assets and $1.03 billion in total debts. POMARE LTD: Can Obtain Up to $1 Million Under Credit Agreement -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has granted Pomare Ltd. permission to draw up to $1 million under its DIP Credit Agreement with North Tustin Partners, Inc., to purchase inventory necessary to the Debtor's operations. Pomare discloses that North Tustin's rights as lender under the DIP Credit Agreement have been assigned to Donald Bum Sik Kang, the owner of Royal Hawaiian Creations and its new owner, who has agreed, as DIP lender, to make the requested advance and to limit the collateral securing such advance to the inventory to be purchased with the funds. All other provisions of the final order will remain in full force and effect. Under the DIP Credit Agreement with North Tustin, Pomare is authorized to obtain up to a maximum of $5,000,000 in loans. A copy of the final order dated December 8, 2008, is available for free at http://bankrupt.com/misc/pomare.finaldiporder.pdf About Pomare Ltd. Based in Honolulu, Hawaii, Pomare Ltd., dba Hilo Hattie, is a tourist-destination retailer with operations chiefly in Hawaii. It has seven stores in Hawaii and two in California. The Company filed for Chapter 11 relief on October 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. Alexis M. McGinness, Esq., and Ted N. Pettit, Esq., at Case Lombardi & Pettit, represent the official committee of unsecured creditors. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. POMARE LTD: Can Use Purchase Money Creditors' Cash Collateral ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware approved on July 28, 2009, the stipulation of Tori Richard, Ltd., Iolani Sportswear, Limited, and DBI Hawaii, Ltd. and Pomare, Ltd., extending the Debtor's authority to use cash collateral until October 31, 2009, to pay reasonable and ordinary operating expenses. As adequate protection, Tori Richard, et al., designated as the "Purchase Money Secured Creditors", are granted replacement liens in the Debtor's post-petition cash on hand, receivables and inventory, together with other newly acquired assets of the Debtor, to the extent of any actual diminution in their respective interests in the prepetition collateral. The stipulated order will be binding on the Debtor, its estate, its creditors, and any subsequently appointed Chapter 11 or Chapter 7 trustee. About Pomare Ltd. Based in Honolulu, Hawaii, Pomare Ltd., dba Hilo Hattie, is a tourist-destination retailer with operations chiefly in Hawaii. It has seven stores in Hawaii and two in California. The Company filed for Chapter 11 relief on October 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. Alexis M. McGinness, Esq., and Ted N. Pettit, Esq., at Case Lombardi & Pettit, represent the official committee of unsecured creditors. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. PREGIS CORPORATION: Moody's Affirms 'B3' Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service affirmed the B3 corporate family rating of Pregis Corporation and revised the outlook to negative from stable and the speculative grade liquidity rating to SGL-4 from SGL-3. Additional instrument ratings are detailed below. The downgrade of the Speculative Grade Liquidity Rating and revision of the outlook to negative reflect the projected tightness under certain covenants in the company's credit agreement, the deterioration in the company's credit metrics and the challenging operating and competitive environment. Step downs in the company's financial covenants coupled with poor operating performance over the last several quarters leave little room for negative operating variance near term. Pregis derives approximately 65% of its revenue from the cyclical protective packaging market which has experienced an intensifying competitive environment due to a dramatic decline in volumes and its fragmented structure. Moody's anticipates ongoing softness in the company's markets (primarily in protective packaging). Despite the significant cost cutting programs the company has instituted, Moody's believes it may be challenged to improve metrics to a level necessary to provide adequate cushion under its financial covenants in the near term. The ratings benefit from Pregis' diverse product line, long standing customer relationships and low concentration of sales. The company is also geographically diversified with a significant international presence (primarily Western Europe) and some exposure to faster growing emerging markets. The company has undertaken significant cost cutting actions which are expected to provide some offset to anticipated continuing softness in the company's primary end market and the loss of a major customer in the specialty packaging segment. Moody's took these ratings: -- Corporate Family Rating, affirmed at B3 -- Probability of Default Rating, affirmed at B3 -- $50 million senior secured first lien revolver due 2011, affirmed at Ba3 (LGD2, 20% from LGD2, 19%) -- $87 million senior secured first lien term loan B-1 due 2012, affirmed at Ba3 (LGD2, 20% from LGD2, 19%) -- EUR68 million senior secured first lien term loan B-2 due 2012, affirmed at Ba3 (LGD2, 20% from LGD2, 19%) -- EUR100 million senior secured second lien notes due 2013, affirmed at B3 (LGD4, 55% from LGD 4, 54%) -- $150 million senior subordinated notes due 2013, affirmed at Caa2 (LGD5, 89% from 85%) -- Speculative Grade Liquidity Rating, downgraded to SGL-4 from SGL-3 The ratings outlook is changed to negative from stable. Moody's last rating action on Pregis occurred on July 1, 2008, when Moody's downgraded the corporate family rating to B3 and revised the outlook to stable from negative. Deerfield, Illinois-based Pregis Corporation manufactures, markets and distributes protective and specialty packaging for industrial, foodservice and medical applications. Pregis operates in two segments including protective packaging and specialty packaging. The company generated approximately $946 million of revenue in the last twelve months ended March 31, 2009. PROTOSTAR LTD: Can Access $2MM of DIP Financing with Credit Suisse ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized, on an interim basis, ProtoStar Ltd. and its debtor-affiliates to: -- obtain $2,000,000 of debtor-in-possession financing from lenders led by Canyon Capital Advisors LLC, as administrative agent, and Bank of Mellon, as collateral agent; -- use cash collateral in which the prepetition lenders have an interest; and -- grant adequate protection to the prepetition lenders' liens, grant superpriority expense claims to the agent and the DIP lenders. A final hearing on the DIP and cash collateral motion is set for August 20, 2009, at 11:30 a.m. before this Court. Objections, if any, are due 4:00 p.m. on August 13, 2009. As of ProtoStar's petition date, the outstanding principal balance under the Bank of New York Mellon and Canyon Capital Advisors LLC under the working capital agreement was $10,000,000; and under the BNYM senior secured notes was $182,363,076. The Debtors also owe under that certain facility agreement with Credit Suisse, Singapore Branch, together with Canyon, the financial institutions party thereto. The Debtors related that the use of cash collateral alone would not be insufficient to meet the their immediate postpetition liquidity needs. Credit Suisse agreed to extend the DIP financing. The Salient Terms of the DIP Financing Borrowers: ProtoStar Ltd. and ProtoStar II Ltd. Guarantors: ProtoStar Development Ltd., ProtoStar Asia Pte. Ltd. and ProtoStar II Asia Services Ltd. Administrative Agent: Credit Suisse, Cayman Islands Branch Lenders: Financial Institutions party thereto as lenders DIP Loan Facility: $2,000,000 on the interim basis. Availability: The DIP loan facility will be available in multiple tranches: (i) $2,000,000 upon entry of the interim order; and (ii) upon entry of the final order with up to two additional delayed draws in amounts and at times consistent with the cash flow budget. Maturity Date: The DIP Facility will terminate 30 days after the petition date if the final order has not been entered; consummation of sale of the PSII or the shares of PS II; 90 days after the petition date, however, if the borrowers have consummated a sale. Interest Rates: one month LIBOR with a floor of 2.5% plus 12.5%; Default Rate: 2% in addition to the current rate. Events of Default: Usual and Customary DIP Fees: All fees payable and expenses reimbursable by the credit parties to the agent. As additional adequate protection, the Debtors will pay the prepetition lenders upon the closing of the ProtoStar I sale, the net asset sale proceeds. About ProtoStar Ltd. Hamilton, HM EX, Bermuda-based ProtoStar Ltd. is a satellite operator formed in 2005 to acquire, modify, launch and operate high-power geostationary communication satellites for direct-to- home satellite television and broadband internet access across the Asia-Pacific region. The Company and its affiliates filed for Chapter 11 on July 29, 2009 (Bankr. D. Del. Lead Case No. 09-12659.) The Debtor selected Pachulski Stang Ziehl & Jones LLP as Delaware counsel; Law Firm of Appleby as their Bermuda counsel; UBS Securities LLC as financial advisor & investment banker and Kurtzman Carson Consultants LLC as claims and noticing agent. In their petition, the Debtors listed assets and debts both ranging from $100,000,001 to $500,000,000. As of December 31, 2008, ProtoStar's consolidated financial statements, which include non-debtor affiliates, showed total assets of $463,000,000 against debts of $528,000,000. PROVIDENT ROYALTIES: Court Okays Sale Protocol; Bids Due August 18 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas has approved bid procedures in connection with a sale of substantially all of Provident Royalties, LLC, et al's assets, to Sinclair Oil & Gas Company, the "stalking horse" bidder, subject to higher and better offers at an auction. Sinclair Oil holds more than $150 million in senior secured debt, secured by substantially all of the Debtors' oil and gas assets. Pursuant to the purchase and sale agreement, Sinclair has agreed to credit bid the full amount of its senior debt of $150,000,000, plus interest and fees. The agreement also includes: -- an agreement by Sinclair Finance Company to not participate in the first $7.5 million of distribution to other unsecured creditors as to the Sinclair subdebt, and an agreement to waive any liens associated with the Sinclair subdebt; -- a relinquishment of all rights to any and all cash collateral held by the Debtors as of the closing; -- payment of a portion of the investment banking fee associated with the sale; and -- a mutual release of claims. A decision on the Debtors' motion for the payment to Sinclair of a termination fee of $500,000 and an overbid fee for out-of pocket costs and expenses incurred in connection with the agreement will be made at the August 25, 2009 sale hearing. Competing bids are due no later than 12:00 noon on August 18, 2009. Bids must provide for cash consideration to sellers of at least $1,250,000 over the purchase price. Sale shall be on an "as is, where is" basis. Objections, if any, to the sale motion, are due no later than August 14, 2009, at 4:00 p.m. If necessary, an auction will be held on August 24, 2009, at 10:00 a.m. at the offices of Munsch Hardt Kopf & Harr, P.C., 3800 Lincoln Plaza, 500 N. Akard Street, Dallas, Texas 75201. Interested parties may contact Mike Pokrassa at Raymond James & Associates, Inc., 277 Park Avenue, 4th Foor, New York, NY 10172, phone number: (212) 885-1801. About Provident Royalties Based in Dallas, Texas, Provident Royalties LLC owns working interests in oil and gas properties primarily in Oklahoma. Provident and its affiliates filed for Chapter 11 on June 22, 2009 (Bankr. N.D. Tex. Case No. 09-33886). Judge Harlin DeWayne Hale presides over the case. Patton Boggs LLP represents the Debtors as their bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, is the claims and noticing agent. The United States Trustee for the Northern District of Texas appointed nine members to the Official Committee of Unsecured Creditors. ennis L. Roossien, Jr., Esq., at Munsch Hardt Kopf & Harr P.C. in Dallas, Texas, serve as the Debtors' Chapter 11 trustee. The Company listed between $100 million and $500 million each in assets and debts. On July 2, 2009, the Securities and Exchange Commission filed, under seal, a complaint in District Court for the Northern District of Texas against the Debtors and certain of their principals and managing partners on allegations that they sold stock and limited partnership interest to over 7,700 investors as part of a $485 million Ponzi scheme. On July 2, 2009, the District Court for the Northern District of Texas appointed Dennis L. Roossien, Jr., as receiver for the Debtors. On July 20, 2009, the Bankruptcy Court appointed the Receiver as the Debtors' chapter 11 trustee. Mr. Roossien has taken possession and control of the Debtors' property and business. QUEST RESOURCE: Amends 2008 Annual Report to Correct Errors ----------------------------------------------------------- Quest Resource Corp. filed with the Securities and Exchange Commission Amendment No. 1 on Form 10-K/A to the Annual Report on Form 10-K, originally filed on June 3, 2009, to correct an error identified in July 2009 related to the incorrect classification of realized gains on commodity derivative instruments during the year ended December 31, 2008. The error resulted in an understatement of revenue and an overstatement of the gain from derivative financial instruments by approximately $14.6 million for the year ended December 31, 2008, of which $2.4 million, $17.8 million, $15.1 million and ($20.7) million related to the quarters ended March 31, June 30, September 30, and December 31, 2008, respectively. The error had no effect on net income (loss), net income (loss) per share, stockholders' equity or the Company's Consolidated Balance Sheet, Consolidated Statement of Cash Flows or Consolidated Statement of Stockholders' Equity as of and for the year ended December 31, 2008, or any of the interim periods during 2008. In accordance with the guidance in Staff Accounting Bulletin No. 99, "Materiality," management evaluated the error from a quantitative and qualitative perspective and concluded it was not material to any period. A full-text copy of Amendment No. 1 on Form 10-K/A is available at no charge at http://ResearchArchives.com/t/s?4093 The Company also filed Amendment No. 1 to amend the Current Report on Form 8-K filed on July 16 related to the Company's acquisition of PetroEdge Resources (WV) LLC. The Form 8-K/A amends the Original Report to include the financial statements and pro forma information. A full-text copy of the PetroEdge Financial Statements is available at no charge at http://ResearchArchives.com/t/s?4094 A full-text copy of QRCP's Pro Forma Financial Information is available at no charge at http://ResearchArchives.com/t/s?4095 About Quest Resource Quest Resource Corporation -- http://www.qrcp.net/, http://www.qelp.net, and http://www.qmlp.net/-- is a fully integrated E&P company that owns producing properties and acreage in the Appalachian Basin of the northeastern United States; 100% of the general partner and a 57% limited partner interest in Quest Energy Partners, L.P.; and 85% of the general partner and a 36.4% of the limited partner interests in the form of subordinated units in Quest Midstream Partners, L.P. Quest Resource operates and controls Quest Energy Partners and Quest Midstream Partners through its ownership of their general partners. As reported by the Troubled Company Reporter on June 23, 2009, the report of UHY LLP, in Houston, Texas, the Company's independent registered public accounting firm, on its financial statements for the fiscal year ended December 31, 2008, includes an explanatory paragraph regarding the Company's ability to continue as a going concern. The factors contributing to this concern include QRCP's recurring losses from operations, stockholders' accumulated deficit, and inability to generate sufficient cash flow to meet its obligations and sustain its operations. QRCP does not anticipate being able to make its next quarterly principal payment due September 30, 2009, under its Amended and Restated Credit Agreement with Royal Bank of Canada, as administrative agent and collateral agent. The TCR said July 14 that QRCP's lenders led by Royal Bank of Canada, among other things, agreed to waive the interest coverage ratio and leverage ratio covenants for the fiscal quarter ended June 30, 2009; and defer until September 30, 2009, interest payment due on June 30, 2009. At December 31, 2008, the Company had $650,176,000 in total assets; $96,276,000 in current liabilities, $353,246,000 in long- term liabilities, and $204,536 in minority interests; resulting in $3,882,000 in stockholders' deficit. QUEST RESOURCE: Files Sept. 2008 Qtr Report, 2007 Restatement ------------------------------------------------------------- Quest Resource Corp. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, which includes: -- consolidated interim financial statements as of September 30, 2008, and for the three and nine month periods ended September 30, 2008, which have not previously been issued, and -- restated consolidated interim financial statements for the three and nine month periods ended September 30, 2007, which have not previously been restated in any other report for QRCP. On August 22, 2008, in connection with an inquiry from the Oklahoma Department of Securities, the boards of directors of QRCP; Quest Energy GP, LLC -- Quest Energy GP -- the general partner of Quest Energy Partners, L.P. (NASDAQ: QELP) -- QELP -- which is a publicly traded limited partnership controlled by QRCP; and Quest Midstream GP, LLC -- Quest Midstream GP -- the general partner of Quest Midstream Partners, L.P. -- QMLP -- a private limited partnership controlled by QRCP, held a joint working session to address certain unauthorized transfers, repayments and re-transfers of funds to entities controlled by their former chief executive officer, Jerry D. Cash. A joint special committee comprised of one member designated by each of the boards of directors of QRCP, Quest Energy GP, and Quest Midstream GP was immediately appointed to oversee an independent internal investigation of the Transfers. In connection with this investigation, other errors were identified in prior year financial statements and management and the board of directors concluded that QRCP had material weaknesses in its internal control over financial reporting. As of December 31, 2008, these material weaknesses continued to exist. On December 31, 2008, the board of directors of QRCP determined that the audited consolidated financial statements of QRCP as of and for the years ended December 31, 2007, 2006, and 2005 and QRCP's unaudited consolidated financial statements as of and for the three months ended March 31, 2008, and as of and for the three and six months ended June 30, 2008, should no longer be relied upon. The investigation and determination that the Company's previously issued financial statements should no longer be relied upon resulted in its inability to timely file the Quarterly Report on Form 10-Q for the quarter ended September 30, 2008. In October 2008, QRCP's audit committee engaged a new independent registered public accounting firm to audit QRCP's consolidated financial statements for 2008 and, in January 2009, engaged them to reaudit QRCP's consolidated financial statements as of December 31, 2007 and 2006 and for the years ended December 31, 2007, 2006, and 2005. It was determined that QRCP's previously issued consolidated financial statements contained errors in a majority of the financial statement line items for all periods presented. A full-text copy of the Company's Form 10-Q for the quarter ended September 30, 2008, is available at no charge at: http://ResearchArchives.com/t/s?4092 About Quest Resource Quest Resource Corporation -- http://www.qrcp.net/, http://www.qelp.net, and http://www.qmlp.net/-- is a fully integrated E&P company that owns producing properties and acreage in the Appalachian Basin of the northeastern United States; 100% of the general partner and a 57% limited partner interest in Quest Energy Partners, L.P.; and 85% of the general partner and a 36.4% of the limited partner interests in the form of subordinated units in Quest Midstream Partners, L.P. Quest Resource operates and controls Quest Energy Partners and Quest Midstream Partners through its ownership of their general partners. As reported by the Troubled Company Reporter on June 23, 2009, the report of UHY LLP, in Houston, Texas, the Company's independent registered public accounting firm, on its financial statements for the fiscal year ended December 31, 2008, includes an explanatory paragraph regarding the Company's ability to continue as a going concern. The factors contributing to this concern include QRCP's recurring losses from operations, stockholders' accumulated deficit, and inability to generate sufficient cash flow to meet its obligations and sustain its operations. QRCP does not anticipate being able to make its next quarterly principal payment due September 30, 2009, under its Amended and Restated Credit Agreement with Royal Bank of Canada, as administrative agent and collateral agent. The TCR said July 14 that QRCP's lenders led by Royal Bank of Canada, among other things, agreed to waive the interest coverage ratio and leverage ratio covenants for the fiscal quarter ended June 30, 2009; and defer until September 30, 2009, interest payment due on June 30, 2009. At December 31, 2008, the Company had $650,176,000 in total assets; $96,276,000 in current liabilities, $353,246,000 in long- term liabilities, and $204,536 in minority interests; resulting in $3,882,000 in stockholders' deficit. RAINBOWS UNITED: Missed Over $2.3MM in Tax Payments for 2 Yrs. -------------------------------------------------------------- Hurst Laviana at The Wichita Eagle reports that Rainbows United, Inc., failed to pay more than $2.3 million in federal withholding taxes over the past two years. Rainbows United listed the Internal Revenue Service as one of its largest creditors, court documents say. The Wichita Eagle states that Rainbows United's $5.6 million in debts include: -- the unpaid federal taxes, -- $2.4 million in outstanding bank loans, and -- $800,000 in accounts payable to organizations and businesses that do business with the Company. It appears that Rainbows United stopped paying federal payroll taxes about two years ago, although it wasn't clear why, The Wichita Eagle relates, citing Steve Cox, chairman of the Company's board of directors. "We'll have a lot more information about how and why in six months," the report quoted Mr. Cox as saying. According to The Wichita Eagle, Mr. Cox said that the board was unaware of any efforts by the IRS to collect the unpaid taxes, but he couldn't rule out the possibility that such an effort was made. Mr. Cox said that the "financial irregularities" that forced Rainbows United bankruptcy involved misleading internal financial statements rather than embezzled money, The Wichita Eagle reports. "We have no indication that there were any funds that left Rainbows," the report quoted him as saying. According to court documents, the $9.4 million in assets that Rainbows United listed include: -- $5 million early-childhood center that opened in January 2009; -- $1.4 million in vehicles and buses; -- $1.6 million in machinery, equipment, and supplies; and -- bank accounts containing about $250,000. Wichita, Kansas-based Rainbows United, Inc. -- http://www.rainbowsunited.org/-- is a Wichita nonprofit agency that serves children with special needs and their families. Rainbows United serves more than 2,600 children aged birth through 5, including more than 2,300 with special needs. The organization, which has 435 full- and part- time employees, serves primarily Sedgwick and Butler counties. Rainbows United filed for Chapter 11 bankruptcy protection on July 30, 2009 (Bankr. D. Kan. Case No. 09-12457). Edward J. Nazar, Esq., at Redmond & Nazar, L.L.P., assists the Company in its restructuring efforts. REFCO INC: Post-Confirmation Quarterly Report for Q2 2009 --------------------------------------------------------- Refco, Inc., and its affiliates, including Refco Capital Markets, Ltd., delivered to the U.S. Bankruptcy Court for the Southern District of New York a copy of their post-confirmation quarterly report for the period from April 1 to June 30, 2009. According to Valerie E. DePiro, chief financial officer of Refco Inc. and Refco Capital Markets, Ltd., cash balance of $81,414,000 at the start of March 2009 decreased to $76,737 at the end of the reporting period. The Reorganized Debtors received $78,533,000 in total cash and disbursed $77,756,000 for the second quarter of 2009. Unaudited Schedule of Cash Receipts and Disbursements (in thousands) Beginning Ending Debtor Balance Receipts Company Disbursements Balance ----- ------- -------- ------- ------------- ------- Refco Capital Markets $22,912 $24,324 $50,035 ($73,968) $24,303 Refco Capital LLC 10,741 54,154 (18,812) (506) 45,577 Refco F/X Assoc. 6,723 48 - (53) 6,718 Refco Global Holdings 36,236 7 (36,242) (1) - Refco Group Ltd.. - - - - - Refco Regulated - - - - - Refco Inc. 125 - 5,019 (4,228) 916 Westminster-Refco - - - - - ------- -------- ------- ------------- ------- Totals $76,737 $78,533 $0 ($77,756) $77,514 The Reorganized Debtors served as paying agent for certain non- Debtors and Refco, LLC. The $24.3 million in receipts for RCM includes proceeds from the recovery of a cash account held at MF Global, miscellaneous asset recoveries, and interest income, Ms. DePiro noted. According to Ms. DePiro, in June 2009, the Contributing Debtors made an interim distribution of the RCM Cash Distribution of $50.0 million. The June 30, 2009 cash balance also includes the 502(h) Special Reserve of $3.0 million and the Disputed Claim Reserve of approximately $6.9 million, as well as wind-down costs. Cash at June 30, 2009 included $839,000 in outstanding checks from Interim Distributions to Allowed Claims, Ms. DePiro added. Schedule of Cash Distributions to Creditors (In Thousands) Quarter Ended Emergence June 30, 2009 to Date ------------- ---------- Administrative and Operating Expenses $937 $1,613 TREATMENT OF CONTRIBUTING DEBTORS' CREDITORS AND INTEREST HOLDERS Priority Tax Claims 56 1,613 Class 1 - Non Tax Priority Claims - - Class 2 - Other Secured Claims - - Class 3 - Secured Lender Claims - 703,967 Class 4 - Senior Subordinated Note Claims - 335,985 Class 5(a) - Contributing Debtors General Unsecured Claims 4,230 141,655 Class 5(b) - Related Claims - - Class 6 - RCM Intercompany Claims - - Class 7 - Subordinated Claims - - Class 8 - Old Equity Interests - - TREATMENT OF FXA CREDITORS Priority Tax Claims - 90 Class 1 - FXA Non-Tax Priority Claims - - Class 2 - FXA Other Secured Claims - - Class 3 - FXA Secured Lender Claims - - Class 4 - FXA Sr. Subordinated Note Claims - - Class 5(a) - FXA General Unsecured Claims - 19,453 Class 5(b) - Related Claims - - Class 6 - FXA Convenience Claims - 4,827 Class 7 - FXA Subordinated Claims - - TREATMENT OF RCM CREDITORS Priority Tax Claims - - Class 1 - RCM Non-Tax Priority Claims - - Class 2 - RCM Other Secured Claims - - Class 3 - RCM FX/Unsecured Claims 38,882 421,876 Class 4 - RCM Securities Customer Claims 33,652 2,628,541 Class 5 - RCM Leuthold Metals Claims - 19,364 Class 6 - Related Claims - - Class 7 - RCM Subordinated Claims - - From April 1 to June 30, 2009, the Reorganized Debtors paid $56,000 in total domestic and foreign federal taxes. Tax claims and notices were received by the Reorganized Debtors from the IRS and State taxing authorities in the aggregate amount of approximately $20 million. All of the original 47 claims filed have been expunged or resolved. Allowed claims total approximately $1.6 million. All insurance policies are fully paid for the current period, including amounts owed for workers' compensation and disability insurance, Ms. DePiro averred. A full-text copy of the Reorganized Debtors' Post-Confirmation Quarterly Report for the Second Quarter 2009 is available at no charge at http://bankrupt.com/misc/Refco2ndQ2009PostCon.pdf About Refco Inc. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company has operations in Bermuda. The Company and 23 of its affiliates filed for Chapter 11 protection on October 17, 2005 (Bankr. S.D.N.Y. Case No. 05- 60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represented the Debtors in their restructuring efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its Chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on December 15, 2006. That Plan became effective on Dec. 26, 2006. Pursuant to the plan, RJM, LLC, was named plan administrator to reorganized Refco, Inc. and its affiliates, and Marc S. Kirschner as plan administrator to Refco Capital Markets, Ltd. Bankruptcy Creditors' Service, Inc., publishes Refco Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Refco Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) RHODE ISLAND HEALTH: S&P Affirms 'BB' Rating on 1998 Bonds ---------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook to negative from stable on Rhode Island Health & Educational Building Corp.'s series 1998 revenue bonds, issued for Roger Williams Hospital, due to the hospital's weaker level of liquidity through the first nine months of fiscal 2009 (interim period). At the same time, Standard & Poor's affirmed its 'BB' long-term rating on the bonds. The rating reflects Roger Williams' adequate financial position for the rating, with hospital management reporting close to breakeven results for both fiscal 2008 and 2007. Through the first nine months of fiscal 2009 (interim period ended June 30, 2009), Roger Williams Hospital alone reported an operating loss of greater-than-budgeted expectations. However, this outcome would have been closer to breakeven if one-time costs were excluded. In addition, management recently implemented cost-saving initiatives that should benefit the operating margin by fiscal year-end. An offsetting credit factor is Roger Williams' light level of liquidity at only about 31 days' cash on hand through the interim period. In addition, Roger Williams is awaiting final approval from the Office of the Attorney General of Rhode Island on its potential affiliation with St. Joseph Health Services, also located in the city of Providence. A final decision on this affiliation is expected by the end of calendar 2009. "The negative outlook reflects concerns related to the organization's light liquidity through fiscal 2008 and further decline through the interim period," said Standard & Poor's credit analyst Jennifer Soule. "While additional funds were received in July to help bolster liquidity, the balance remains light," said Ms. Soule. If Roger Williams is able to close fiscal 2009 in line with budgeted expectations, while maintaining liquidity, the outlook may return to stable. However, if the organization's overall financial profile were to decline over the next year, the rating may be lowered. Roger Williams Hospital, which does not provide obstetric or pediatric services, operates a 220-licensed-bed acute-care hospital in Providence, R.I. ('A'). The hospital is affiliated with Roger Williams Medical Center, which has subsidiaries that include a nursing home and a real estate holding corporation. RHODE ISLAND HEALTH: S&P Cuts Rating on 1999 Bonds to 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term rating to 'BB-' from 'BB' on Rhode Island Health and Educational Building Corp.'s $19.1 million series 1999 bonds issued for St. Joseph Health Services. The lower rating reflects two years of fiscal results (fiscals 2007 and 2008) that fell short of management's budgeted expectations, with this trend expected to continue through the close of fiscal 2009. The outlook remains negative, with various financial uncertainties tied to the organization's efforts to combine its two hospitals and affiliate with a local competitor. The 'BB-' rating further reflects St. Joseph's limited balance sheet with recent declines in the organization's already minimal liquidity. In addition, the competitive Rhode Island service area is another credit concern. A lower rating is precluded at this time pending the financial outcome of the organization's efforts to consolidate its inpatient services on a single campus and the final outcome of an expected affiliation with Roger Williams Medical Center. "The negative outlook reflects concerns that St. Joseph's operating margins will have fallen short of budgeted expectations, including fiscal 2009, for the past three fiscal years," said Standard & Poor's credit analyst Jennifer Soule. "However, S&P expects St. Joseph's to meet its projected expectations for fiscal 2009 and begin to realize efficiencies as part of its internal hospital consolidation, all while maintaining its current levels of liquidity," said Ms. Soule. Standard & Poor's also expects that the Roger Williams affiliation, if given final approval, will provide additional cost savings and further benefit St. Joseph's financial profile. If all of these factors hold true, as articulated by management, the outlook may return to stable at the current rating. However, if St. Joseph's financial profile were to further decline, the rating may be lowered to the 'B' category. St. Joseph has no swaps outstanding. SENTINEL MANAGEMENT: Court Dismisses Suit Against Bank of New York ------------------------------------------------------------------ The Hon. James B. Zagel of the U.S. District Court for the Northern District of Illinois has dismissed a suit against Bank of New York Mellon Corp. brought by the liquidation trustee of money manager Sentinel Management Group Inc., ruling that the trustee cannot recover for Sentinel customers hundreds of millions that were allegedly lost as a result of a fraudulent investment scheme, according to Law360. About Sentinel Management Based in Northbrook, Illinois, Sentinel Management Group Inc. -- http://www.sentinelmgi.com/-- is a full service firm offering a variety of security solutions. The company filed a voluntary Chapter 11 petition on August 17, 2007 (Bankr. N.D. Ill. Case No. 07-14987). Ronald Barliant, Esq., Randall Klein, Esq., and Kathryn A. Pamenter, Esq., at Goldberg, Kohn, Bell & Black Rosenbloom & Moritz, Ltd. represent the Debtor as counsel. Quinn, Emanuel Urquhart Oliver & Hedges, LLP, represents the Official Committee of Unsecured Creditors as counsel. DLA Piper US LLP is the Committee's co-counsel. When the Debtor sought bankruptcy protection, it listed assets and debts of more than $100 million. On August 28, 2007, the Court approved Frederick Grede as the Debtor's Chapter 11 Trustee. Marc I. Fenton, Esq., at DLA Piper US LLP, and Vincent E. Lazar, Esq, at Jenner & Block LLP, represent the Chapter 11 Trustee as counsel. As reported by the Troubled Company Reporter on January 2, 2009, the Court confirmed on December 15, 2008, the plan of liquidation of Sentinel, and Mr. Grede is managing the liquidation. A copy of the Plan is available for free at: http://bankrupt.com/misc/SentinelManagement_4thAmendedPlan.pdf SIRIUS INTERNATIONAL: Moody's Affirms Preferred Shares at 'Ba3' --------------------------------------------------------------- Moody's Investors Service has affirmed the A3 insurance financial strength ratings of Sirius International Insurance Corporation (WMRe Sirius) and White Mountains Reinsurance Company of America (WMRe America) and the Baa3 senior debt rating of White Mountains Re Group, Ltd., following the announcement by White Mountains Insurance Group Ltd. (WTM) that it will reorganize its reinsurance operations. The ratings outlook for these companies is stable. The rating agency stated that the affirmation of the A3 insurance financial strength ratings of both WMRe Sirius and WMRe America reflects each company's position within White Mountains' reinsurance operations, as well as their stand-alone credit characteristics. WMRe Sirius and WMRe America are jointly managed and operate under the common branded franchise of White Mountains Re, and as a result of this cohesion, Moody's believes that the ratings and outlooks on WMRe Sirius and WMRe America should continue to be aligned. As part of the planned reorganization, WTM's Bermuda-domiciled reinsurance operating company, White Mountains Re Bermuda Ltd (WMRe Bermuda), will cease operations, with in-force business ceded to WMRe Sirius. Following the reorganization, WTM's reinsurance platform will utilize two operating companies -- WMRe Sirius and WMRe America. The operations of WMRe Bermuda will effectively be transferred to WMRe Sirius, which will establish a branch office in Bermuda to maintain the company's presence in the Bermuda market. It is anticipated that approximately $200 million of capital will be contributed to WMRe Sirius to support the liabilities it will be assuming from WMRe Bermuda. Approximately $400 million of capital will be upstreamed to WTM and WMRe. According to Moody's, WMRe has reduced both catastrophe risk and investment risk at the group over the past year, which mitigates the credit-related impact resulting from the removal of capital from the reinsurance group. While gross underwriting leverage and financial leverage at the reinsurance group will increase slightly, the reorganization will improve the financial leverage profile of WTM, the ultimate parent company. In Moody's opinion, the reorganization has limited impact on WMRe America, as certain intra-group quota share arrangements will move from WMRe Bermuda to WMRe Sirius. With respect to WMRe Sirius, however, its catastrophe risk exposure profile will increase somewhat through the assumption of reinsurance business from WMRe Bermuda, though this will be off-set to some extent by the related capital contributions to WMRe Sirius. WMRe America's rating reflects the company's good profitability, disciplined reinsurance underwriting practices, high quality investment portfolio and adequate capital base. These strengths are tempered by the inherent volatility of catastrophe risks and the potential for adverse loss reserve development on legacy liabilities. WMRe Sirius' credit strengths include strong capitalization, good underwriting performance, and no material exposure to US long-tail liabilities. Off-setting these strengths are the relatively high exposure to equities compared to reinsurance peers, and concentration risk in its investment portfolio via its ownership interest in a White Mountains subsidiary, White Mountains International S.a.r.l. These ratings have been affirmed, with a stable outlook: * White Mountains Re Group, Ltd. -- senior debt at Baa3, preference shares at Ba2; * Sirius International Insurance Corporation -- insurance financial strength at A3; and * White Mountains Reinsurance Company of America -- insurance financial strength at A3. The last rating action on WMRe and WMRe America occurred on June 19, 2008, when Moody's affirmed the Baa3 senior debt rating and Ba2 preference share rating of WMRe and the A3 insurance financial strength rating of WMRe America following the announcement of a $140 million reserve charge at WMRe America. The last rating action on WMRe Sirius occurred on June 19, 2006, when the A3 insurance financial strength rating was affirmed, with the outlook changed to stable from positive. White Mountains Re Group, Ltd., domiciled in Bermuda, is wholly- owned by White Mountains Insurance Group, Ltd., and writes reinsurance through three operating companies, Sirius International Insurance Corporation (branded White Mountains Re Sirius), White Mountains Reinsurance Company of America and White Mountains Re Bermuda Ltd. As of June 30, 2009, common shareholder's equity at White Mountains Re Group Ltd. was approximately $1.9 billion. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to pay punctually senior policyholder claims and obligations. SPORTSMAN'S WAREHOUSE: Court Confirms 2nd Amended Joint Plan ------------------------------------------------------------ The Hon. Christopher Sontchi of the U.S. Bankruptcy Court for the District of Delaware confirmed Sportsman's Warehouse Inc.'s second amended joint plan of reorganization, according to Law360 According to the Troubled Company Reporter on July 3, 2009, under Sportman's plan, holders of general unsecured claims, totaling $130 million, will receive their pro rata share of the right to receive cash flow payment. Holders are expected to recover 15% of their claims. Furthermore, the reorganized Debtors will obtain an exit facility to: -- satisfy the debtor-in-possession facility claims; -- support other payments required to be made under the amended plan; -- pay transaction costs; and -- fund working capital and other general corporate purposes of the reorganized debtors following their emergence. On the plan's effective date, the plan sponsor will provide a $10 million loan to fund the operations of the reorganized Debtors. The Plan sponsor loan will be secured by the plan sponsor lien. Proceeds of the second lien collateral received in connection with the sale or other disposition of, or collection on, such second lien collateral upon the exercise of remedies with respect thereto, shall be shared pro rata among the holders of the plan sponsor lien and the critical vendor lien. After the plan's effective date, the reorganized Debtors will distribute up to $5 million to certain critical vendors to be designated by the reorganized Debtors with the plan sponsor's approval in exchange for: i) the critical vendor trade credit on terms reasonably satisfactory to the Reorganized Debtors for a period of at least two years; and ii) trade terms. The critical vendor trade credit is trade credit on terms reasonably satisfactory to the Reorganized Debtors, to be provided by critical vendors to the reorganized Debtors for a period of at least two years, in an amount not less than $15 million, as set forth in the trade credit agreements to be entered into prior to the effective date, which trade credit will be secured by the critical vendor lien, and may include trade credit extended subsequent to the effective date, as provided in agreements reasonably satisfactory to the Reorganized Debtors in the plan. Proceeds of the second lien collateral received in connection with the sale or other disposition of, or collection on, such second lien collateral upon the exercise of remedies with respect thereto, will be shared Pro Rata among the holders of the plan sponsor Lien and the critical vendor lien. A full-text copy of the Debtors' disclosure statement is available for free at http://ResearchArchives.com/t/s?3e04 A full-text copy of the Debtors' plan is available for free at http://ResearchArchives.com/t/s?3e05 Headquartered in Midvale, Utah, Sportsman's Warehouse, Inc. -- http://www.sportsmanswarehouse.com/-- and its affiliates has 29 stores selling indoors and outdoor gears and equipment. The Companies filed for Chapter 11 bankruptcy protection on March 20, 2009 (Bankr. D. Del. Bankr. Case No. 09-10990). Gregg M. Galardi, Esq., at Skadden, Arps, Slate, Meagher assists the Companies in their restructuring efforts. Kurtzman Carson Consultants is the Company's claims agent. Roberta DeAngelis, U.S. Trustee for Region 3, appointed seven members to the official committee of unsecured creditors of Sportsman's Warehouse Inc. Greenberg Traurig LLP represents the Committee. The Company listed assets of $436 million against debt totaling $452 million as of December 31, 2008. TEMECULA VALLEY BANCORP: To File Chapter 7 Petition by August 18 ---------------------------------------------------------------- Temecula Valley Bancorp Inc. said in a filing with the Securities and Exchange Commission that it intends to file a voluntary petition in the U.S. Bankruptcy Court of the Central District of California, Riverside Division, seeking relief under Chapter 7 of Title 11 of the United States Code by August 18, 2009. The Chapter 7 bankruptcy filing is precipitated the decision of the California Department of Financial Institutions to close Company's former subsidiary, Temecula Valley Bank and subsequently appoint the Federal Deposit Insurance Corporation as receiver. As a result of the FDIC being appointed receiver of the Bank on July 17, 2009 and the planned Chapter 7 bankruptcy filing, the Company has ceased all business activity and operations since the Bank was the Company's only source of revenue. Upon filing of the petition, the court will appoint a bankruptcy trustee who will be responsible for liquidating the Company. The planned Chapter 7 bankruptcy filing of Title 11 of the United States Code would cause an event of default under the terms of the indentures governing trust preferred securities issued by the Company's five unconsolidated special purpose business trusts: Temecula Valley Statutory Trusts II, III, IV, V and VI. Subject to certain notice and waiting requirements particular to the documentation of each Trust, upon the occurrence of this event of default, the trustee or holders of not less than 25% in principal of the outstanding debentures of each Trust may declare the entire principal, premium and any accrued unpaid interest immediately due and payable. About Temecula Valley Temecula Valley Bancorp Inc. served as the holding company for Temecula Valley Bank. Temecula Valley Bank, Temecula, California, was closed July 17 by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First-Citizens Bank and Trust Company, Raleigh, North Carolina, to assume all of the deposits of Temecula Valley Bank, excluding those from brokers. As of May 31, 2009, Temecula Valley Bank had total assets of $1.5 billion and total deposits of approximately $1.3 billion. In addition to assuming all of the deposits of the failed bank, First-Citizens Bank and Trust Company agreed to purchase essentially all of the assets. TEMECULA VALLEY BANCORP: Philip Guldeman Resigns as CFO ------------------------------------------------------- Philip E. Guldeman resigned as Chief Financial Officer of Temecula Valley Bancorp Inc. on July 28, 2009. Temecula Valley Bancorp Inc. served as the holding company for Temecula Valley Bank. Temecula Valley Bank, Temecula, California, was closed July 17 by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First-Citizens Bank and Trust Company, Raleigh, North Carolina, to assume all of the deposits of Temecula Valley Bank, excluding those from brokers. As of May 31, 2009, Temecula Valley Bank had total assets of $1.5 billion and total deposits of approximately $1.3 billion. In addition to assuming all of the deposits of the failed bank, First-Citizens Bank and Trust Company agreed to purchase essentially all of the assets. Temecula Valley Bancorp Inc. said in a filing with the Securities and Exchange Commission that it intends to file a voluntary petition in the U.S. Bankruptcy Court of the Central District of California, Riverside Division, by August 18, 2009, seeking relief under Chapter 7 of Title 11 of the United States Code. TERPHANE HOLDING: Moody's Cuts Corporate Family Rating to 'Caa3' ---------------------------------------------------------------- Moody's Investors Service downgraded the corporate family rating Terphane Holding Corporation to Caa3 from Caa2. Moody's also downgraded the senior secured notes ratings to Ca from Caa2 and probability of default rating to Ca/LD from Caa2 following the company's disclosure that it had reached a forbearance agreement with a majority of its bondholders that effectively extends the maturity of $83 million senior secured notes by one year. The agreement reflects the tenuous nature of the company's financial condition and is considered a limited default by Moody's definition as denoted by the Ca/LD probability of default rating. After approximately three business days Moody's will remove the LD designation and change the probability of default rating as well as the senior secured notes ratings to Caa3. The outlook remains negative. The downgrade of the corporate family rating to Caa3 reflects Terphane's inability to secure long term financing for the recent bond maturities, an unsustainable capital structure and a lack of improvement in the company's credit statistics to a level commensurate with the rating category. The downgrade also reflects the company's lack of liquidity and challenging operating and competitive environment. The company does not have a committed revolver and is facing significant debt maturities within the next twelve months. Terphane has not met projected results and faces diverse business challenges. Moody's also notes that there is limited transparency from the company into its operations and projections. The negative outlook reflects Moody's belief that Terphane will be challenged to improve credit statistics and secure long term financing in the current operating, competitive and capital markets environment. Moody's took these rating actions for Terphane Holding Corporation: -- $76.5 million senior secured notes, due 2010, downgraded to Ca from Caa2 (will be revised to Caa3 LGD 4, 51% after three business days) -- $6.5 million senior secured notes, due 2010, downgraded to Ca from Caa2 (will be revised to Caa3 LGD 4, 51% after three business days) -- Corporate Family Rating, downgraded to Caa3 from Caa2 -- Probability of Default, downgraded to Ca/LD from Caa2 (will be revised to Caa3 after three business days) The ratings outlook remains negative. Moody's last rating action on Terphane occurred on July 29, 2008, when Moody's downgraded the corporate family rating to Caa2 with a negative outlook. Terphane Holding Corporation is a manufacturer of specialty polyester films with technical support and manufacturing operations in North America and South America. Headquartered in Cabo de Santo Agostinho, Pernambuco, Brazil, Terphane had revenues of roughly $106 million for the twelve months ended March 31, 2009. TORREYPINES THERAPEUTICS: Amends Employment Deal with CEO, et al. ----------------------------------------------------------------- TorreyPines Therapeutics, Inc., reports that on July 27, 2009, as part of the execution of the Agreement and Plan of Merger with Raptor Pharmaceuticals Corp., each director of TorreyPines agreed to resign as a director contingent upon the closing of the Merger. The effective date of such resignations has not yet been set. TorreyPines also entered into various employment agreements: (A) Ev Graham On July 27, 2009, TPTX, Inc., entered into a second amended and restated employment agreement with Chief Executive Officer, Evelyn Graham. The second amended and restated employment agreement amends and restates the employment agreement between TorreyPines, TPTX and Ms. Graham dated September 1, 2008, as amended February 3, 2009. This second amended and restated employment agreement was entered into in connection with the Merger and will become effective only upon the closing of the Merger. Upon effectiveness, if the Merger closes, this second amended and restated employment agreement shall replace and supersede all prior employment agreements between Ms. Graham and TPTX or TorreyPines. The second amended and restated agreement, once effective, will remain effective through February 28, 2010, and may be terminated by Ms. Graham or TPTX at any time, with or without cause. Ms. Graham's second amended and restated employment agreement reflects her current annual base salary of $350,000. The agreement does not provide for any annual bonus or vacation. Pursuant to the terms of Ms. Graham's second amended and restated employment agreement, in the event that Ms. Graham is terminated for any reason, Ms. Graham will be entitled to continue to receive her base salary through February 28, 2010. In addition, if, following the effective time of Ms. Graham's second amended and restated employment agreement and prior to February 28, 2010, TPTX (i) sells to a third party buyer any equity securities of TPTX and the proceeds from such sale are used primarily for the development of TPTX's product designated NGX426, (ii) completes a change of control transaction or (iii) enters into a partnership, option, or similar arrangement and such sale or equivalent transaction as described in clauses (i), (ii) or (iii) above is approved by TPTX and is for aggregate cash consideration (net of all costs and expenses associated with the sale) received by TPTX on or before February 28, 2010 of not less than $10 million, then promptly following the closing of such sale or equivalent transaction, (A) TPTX shall pay to Ms. Graham an amount equal to (a) 3.0% of the aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX in the sale or equivalent transaction multiplied by (b) 41%, and (B) TorreyPines shall pay to Ms. Graham an amount equal to (x) 2.0% of the aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX in the sale or equivalent transaction multiplied by (y) 41%. (B) Craig Johnson On July 27, 2009, TPTX entered into a second amended and restated employment agreement with Chief Financial Officer, Craig Johnson. The second amended and restated employment agreement amends and restates the previously disclosed employment agreement between TorreyPines, TPTX and Mr. Johnson dated November 12, 2008, as amended February 3, 2009. The second amended and restated employment agreement was entered into in connection with the Merger and will become effective only upon the closing of the Merger. Upon effectiveness, if the Merger closes, this second amended and restated employment agreement shall replace and supersede all prior employment agreements between Mr. Johnson and TPTX or TorreyPines. The second amended and restated agreement, once effective, will remain effective through February 28, 2010, and may be terminated by Mr. Johnson or TPTX at any time, with or without cause. Mr. Johnson's second amended and restated employment agreement reflects his current annual base salary of $282,000. The agreement does not provide for any annual bonus or vacation. Pursuant to the terms of Mr. Johnson's second amended and restated employment agreement, in the event that Mr. Johnson is terminated for any reason, Mr. Johnson will be entitled to continue to receive his base salary through February 28, 2010. In addition, if, following the effective time of Mr. Johnson's second amended and restated employment agreement and prior to February 28, 2010, TPTX (i) sells to a third party buyer any equity securities of TPTX and the proceeds from such sale are used primarily for the development of TPTX's product designated NGX426, (ii) completes a change of control transaction or (iii) enters into a partnership, option, or similar arrangement and such sale or equivalent transaction as described in clauses (i), (ii) or (iii) is approved by TPTX and is for aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX on or before February 28, 2010 of not less than $10 million, then promptly following the closing of such sale or equivalent transaction, (A) TPTX shall pay to Mr. Johnson an amount equal to (a) 3.0% of the aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX in the sale or equivalent transaction multiplied by (b) 33%, and (B) TorreyPines shall pay to Mr. Johnson an amount equal to (x) 2.0% of the aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX in the sale or equivalent transaction multiplied by (y) 33%. (C) Paul Schneider On July 27, 2009, TPTX entered into a second amended and restated employment agreement with Vice President and General Counsel, Paul Schneider. The second amended and restated employment agreement amends and restates the previously disclosed employment agreement between TorreyPines, TPTX and Mr. Schneider dated November 12, 2008, as amended February 3, 2009. The second amended and restated employment agreement was entered into in connection with the Merger and will become effective only upon the closing of the Merger. Upon effectiveness, if the Merger closes, this second amended and restated employment agreement shall replace and supersede all prior employment agreements between Mr. Schneider and TPTX or TorreyPines. This second amended and restated agreement, once effective, will remain effective through February 28, 2010 and may be terminated by Mr. Schneider or TPTX at any time, with or without cause. Mr. Schneider's second amended and restated employment agreement reflects his current annual base salary of $217,700. The agreement does not provide for any annual bonus or vacation. Pursuant to the terms of Mr. Schneider's second amended and restated employment agreement, in the event that Mr. Schneider is terminated for any reason, Mr. Schneider will be entitled to continue to receive his base salary through February 28, 2010. In addition, if, following the effective time of Mr. Schneider's second amended and restated employment agreement and prior to February 28, 2010, TPTX (i) sells to a third party buyer any equity securities of TPTX and the proceeds from such sale are used primarily for the development of TPTX's product designated NGX426, (ii) completes a change of control transaction or (iii) enters into a partnership, option, or similar arrangement and such sale or equivalent transaction as described in clauses (i), (ii) or (iii) is approved by TPTX and is for aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX on or before February 28, 2010 of not less than $10 million, then promptly following the closing of such sale or equivalent transaction, (A) TPTX shall pay to the Mr. Schneider an amount equal to (a) 3.0% of the aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX in the sale or equivalent transaction multiplied by (b) 26%, and (B) TorreyPines shall pay to Mr. Schneider an amount equal to (x) 2.0% of the aggregate cash consideration (net of all costs and expenses associated with the sale or equivalent transaction) received by TPTX in the sale or equivalent transaction multiplied by (y) 26%. About TorreyPines TorreyPines Therapeutics, Inc. -- http://www.tptxinc.com/-- is a biopharmaceutical company that aims to develop product candidates each capable of treating a number of acute and chronic diseases and disorders such as migraine and chronic pain. The company currently has two ionotropic glutamate receptor antagonist clinical stage product candidates. TorreyPines Therapeutics had $6.70 million in total assets, $4.87 million in total liabilities, and $1.83 million in stockholders' equity at March 31, 2009. * * * Ernst & Young LLP, the Company's independent registered public accounting firm, has included an explanatory paragraph in their report on the Company's 2008 financial statements related to the uncertainty and substantial doubt of its ability to continue as a going concern. The Company received on March 31, 2009, a letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying the Company that based on the Company's stockholders' equity as reported in its Annual Report on Form 10-K for the year ended December 31, 2008, the Company does not comply with the minimum stockholders' equity requirement of $10 million for continued listing on The Nasdaq Global Market as set forth in NASDAQ Marketplace Rule 4450(a)(3). TORREYPINES THERAPEUTICS: Cancels Shareholders' Meeting ------------------------------------------------------- TorreyPines Therapeutics, Inc., cancelled its Special Meeting of Stockholders, scheduled July 30 at 9:00 a.m., local time. The purpose of the meeting was for stockholder to vote upon a proposal to approve the liquidation and dissolution of TPTX. Given the entry in an Agreement and Plan of Merger between TPTX and Raptor Pharmaceuticals Corp., on July 24, 2009, TorreyPines' Board of Directors unanimously approved canceling the Special Meeting of Stockholders -- originally scheduled for July 9, which was then adjourned until July 30 -- to focus on completing the merger transaction. As reported by the Troubled Company Reporter on July 30, 2009, Raptor entered into an Agreement and Plan of Merger and Reorganization with TorreyPines and ECP Acquisition, Inc. -- Merger Sub -- a wholly owned subsidiary of TorreyPines. TorreyPines will acquire Raptor in a stock-for-stock reverse triangular merger. In the Merger, Merger Sub will be merged with and into Raptor, with Raptor surviving the merger as a wholly owned subsidiary of TorreyPines. As reported by the TCR on June 4, 2009, TorreyPines' board of directors determined, after consideration of potential strategic and financing alternatives, that it is in the best interests of the Company and its stockholders to liquidate the Company's assets and dissolve the Company. The board approved a Plan of Liquidation and Dissolution of the Company subject to stockholder approval. Although the board of directors approved the Plan of Dissolution, the Company said it continues to seek and will consider any reasonable alternative strategic or financing proposals presented to the Company. In connection with the proposed merger, TorreyPines will file a registration statement on Form S-4 that contains a joint proxy statement/prospectus with the SEC. Investors and security holders of Raptor and TorreyPines are urged to read the joint proxy statement/prospectus to be included in a registration statement filed on Form S-4 (including any amendments or supplements thereto) regarding the merger when it becomes available because it will contain important information about Raptor and TorreyPines. Raptor's and TorreyPines' stockholders will be able to obtain a copy of the joint proxy statement/prospectus, as well as other filings containing information about Raptor and TorreyPines, without charge, at the SEC's Internet Web site. Copies of the joint proxy statement/prospectus and Raptor's and TorreyPines' filings with the SEC can also be obtained, without charge, by directing a request to Raptor Pharmaceuticals Corp., 9 Commercial Blvd., Suite 200, Novato, CA 94949, Attention: Christopher M. Starr, Ph.D., CEO, Fax No. 415-382-1458 or at the email address: cstarr@raptorpharma.com, with respect to Raptor, and by directing a request to TorreyPines Therapeutics, Inc., 11085 North Torrey Pines Road., Suite 300, La Jolla, CA 92037, Attention: Investor Relations or at the email address: cjohnson@tptxinc.com, with respect to TorreyPines. In addition to the registration statement and related joint proxy statement/prospectus, each of Raptor and TorreyPines file annual, quarterly and special reports, proxy statements and other information with the SEC. About TorreyPines TorreyPines Therapeutics, Inc. -- http://www.tptxinc.com/-- is a biopharmaceutical company that aims to develop product candidates each capable of treating a number of acute and chronic diseases and disorders such as migraine and chronic pain. The company currently has two ionotropic glutamate receptor antagonist clinical stage product candidates. TorreyPines Therapeutics had $6.70 million in total assets, $4.87 million in total liabilities, and $1.83 million in stockholders' equity at March 31, 2009. * * * Ernst & Young LLP, the Company's independent registered public accounting firm, has included an explanatory paragraph in their report on the Company's 2008 financial statements related to the uncertainty and substantial doubt of its ability to continue as a going concern. The Company received on March 31, 2009, a letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying the Company that based on the Company's stockholders' equity as reported in its Annual Report on Form 10-K for the year ended December 31, 2008, the Company does not comply with the minimum stockholders' equity requirement of $10 million for continued listing on The Nasdaq Global Market as set forth in NASDAQ Marketplace Rule 4450(a)(3). TOWER AUTOMOTIVE: PCT Reaches Deal with SPS to Reduce Claims ------------------------------------------------------------ The Tower Automotive Post-Consummation Trust seeks court approval of a settlement of claims with SPS Technologies Waterford Co. Under the deal, SPS Technologies' Claim No. 6731 will be reduced from $105,922 to $3,500, and will be allowed as an administrative expense claim against Tower Automotive Inc. The parties also agreed to release each other from all claims. The settlement does not affect the terms and conditions of the settlement agreement between SPS Technologies and Eugene Davis, trustee of the TAI Unsecured Creditors Liquidating Trust, in the lawsuit filed by the trustee against the company. Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- (OTC Bulletin Board: TWRAQ) is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The Company has operations in Korea, Spain and Brazil. The company and 25 of its debtor-affiliates filed voluntary Chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed US$787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. On July 11, 2007, the Court confirmed the Debtors' Amended Chapter 11 Plan and the Debtors emerged from Chapter 11 on July 31, 2007. (Tower Automotive Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TOWER AUTOMOTIVE: Post Consummation Trust Disbursed $467,000 in Q1 ------------------------------------------------------------------ Julie Hertzberg, on behalf of the Tower Automotive Post Consummation Trust, disclosed in a fee statement that during the quarter ended March 31, 2009, a total of $467,010, was disbursed by the liquidating trust in Tower Automotive Inc.'s bankruptcy case. No disbursements were made on behalf of its affiliated debtors. Period Disbursements ------ ------------- January 2009 $35,132 February 2009 1,643 March 2009 430,235 -------- $467,010 ======== Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- (OTC Bulletin Board: TWRAQ) is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The company has operations in Korea, Spain and Brazil. The company and 25 of its debtor-affiliates filed voluntary Chapter 11 petitions on February 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed US$787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. On July 11, 2007, the Court confirmed the Debtors' Amended Chapter 11 Plan and the Debtors emerged from Chapter 11 on July 31, 2007. (Tower Automotive Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TOWER AUTOMOTIVE: TAI Mediation with Acemco Fail to Reach Deal -------------------------------------------------------------- Pursuant to the Bankruptcy Court's order approving mediation procedures, I. William Cohen, Esq., at Pepper Hamilton LLP, in Detroit, Michigan, filed in Court a report concerning the mediation it handled. Mr. Cohen was selected as mediator by Acemco Inc. and TRW- Steering & Suspension Systems. Acemco is a defendant of a lawsuit prosecuted by Eugene Davis, trustee of the TAI Unsecured Creditors Liquidating Trust, while TRW-Steering is a defendant of a case filed by R.J. Tower Corporation and three other companies. Mr. Cohen disclosed in his report that a mediation had been conducted in both cases, however, the parties failed to reach a settlement of the lawsuits. Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- (OTC Bulletin Board: TWRAQ) is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The company has operations in Korea, Spain and Brazil. The Company and 25 of its debtor-affiliates filed voluntary Chapter 11 petitions on February 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed US$787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. On July 11, 2007, the Court confirmed the Debtors' Amended Chapter 11 Plan and the Debtors emerged from Chapter 11 on July 31, 2007. (Tower Automotive Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TRIBUNE CO: Proposes Management Incentive Plan ---------------------------------------------- Tribune Company and its debtor affiliates ask Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware for permission to implement a 2009 Management Incentive Plan that includes: (a) a continuation of the Debtors' self-funding ordinary course annual management incentive program opportunity for approximately 720 management employees with an aggregate payout opportunity of approximately $17,500,000 if Tribune Company achieves its "planned" 2009 operating cash flow goal, and an aggregate payout of approximately $35,000,000 if Tribune achieves "stretch" performance equal to 142% of its "planned" operating cash flow; (b) a Transition MIP to incentivize 21 members of the Debtors' core management team with an aggregate payout opportunities of approximately $3,500,000 at "planned" 2009 operating cash flow and approximately $7,500,000 at "stretch" 2009 operating cash flow, as well as a discretionary pool of $500,000 at "planned" performance and $1,000,000 at "stretch" performance for up to 50 other employees based on management judgment of their contributions to the Debtors' restructuring efforts; and (c) a Key Operations Bonus with a maximum aggregate opportunity of approximately $9,300,000 to incentivize 23 participants who also participate in the annual MIP component of the 2009 Management Incentive Plan but who do not participate in the Transition MIP. The Debtors also seek the Court's authority to make payouts totaling $3,100,000 in earned 2008 MIP awards to nine of the Top 10 executives -- that include the Chief Operating Officer, Chief Administrative Officer, Chief Financial Officer, General Counsel, two Executive Vice Presidents, President of Tribune Broadcasting, Publisher of the Los Angeles Times, Executive Vice President of Tribune Publishing, and President of Tribune Interactive, a non- Debtor executive. None of the Top 10 Executives have received any awards despite payment of 2008 MIP awards to all other participants. Continuation in 2009 of the ordinary course annual MIP component of the 2009 MIP for approximately 720 participants is entirely consistent with the Debtors' historical practice, says Kate J. Stickles, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware. According to Ms. Stickles, the Transition MIP component of the 2009 MIP also is a reasonable and necessary component. She relates that the 21 participants in the Transition MIP hold key positions with top-level responsibility, and have been identified by management and the Compensation Committee as principally responsible for the Debtors' restructuring efforts. Ms. Stickles tells the Court that the Transition MIP motivates strong operating performance by offering incentive opportunities on the level of 2009 operating cash flow relative to Tribune's 2009 operating plan. In addition, the Debtors note, the Key Operators Bonus is aimed to motivate operating leaders to continue to focus on transformation of their businesses throughout 2009. Ms. Stickles relates that the Debtors have taken a thoughtful and conservative approach with the 2009 MIP and the remaining 2008 MIP awards to ensure these proper incentives, to bring the participants' compensation closer to the market median relative to their peers, and to avoid the substantial undercompensation and dilution of incentives that otherwise would occur. A full-text copy of the 2009 Tribune MIP is available for free at http://bankrupt.com/misc/Tribune_2009MIP.pdf Debtors Seek to File Mercer Report Under Seal In a separate filing, the Debtors seek the Court's authority to file under seal a report, dated July 22, 2009, prepared by Mercer (US) Inc., reviewing and analyzing the MIP. The Debtors further ask that any objections to the Incentive Plan Motion that contain or reflect the confidential information contained in the Mercer Report be filed under seal. The Debtors assert that information in the Mercer Report contains sensitive information relating to the compensation of several officers and other management-level employees. The Debtors further assert that public dissemination of the confidential information would provide their competitors with a substantial and unfair competitive advantage to the severe detriment of the Debtors' estates. The Debtors further note that the Mercer Report could provide their competitors with insights into the commercial operations and strategies of the Debtors with regard to employee compensation. The proposed 2009 MIP has been reviewed and approved by the Compensation Committee of Tribune's Board of Directors. The 2009 MIP has also been developed and analyzed by Mercer, an independent compensation consulting firm that concluded that the various incentive benefit opportunities provided under the 2009 MIP all are within reasonable market ranges and are common forms of compensation for companies in Chapter 11 cases. C. Bigelow & J. Dempsey File Affidavits In separate affidavits, Chandler Bigelow III, senior vice president and chief financial officer of Tribune, and John Dempsey, principal of Mercer, filed with the Court affidavits in support of the motion. Mr. Dempsey assures the Court that the MIP, transition MIP and Key Operations Bonus are within reasonable market ranges, are reasonable in cost, and are a common form of compensation both for companies in Tribune's industry and for companies in Chapter 11. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Wants Plan Filing Deadline Moved to November 30 ----------------------------------------------------------- Tribune Company and its debtor affiliates ask Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware, to extend their exclusive period to file a plan of reorganization through November 30, 2009. The Debtors also ask the Court to extend their exclusive right to solicit acceptance of that Plan through March 15, 2010. The Debtors relate that during the past seven months, they have made significant progress in administering their cases and productively utilizing their exclusivity periods. The Debtors tell the Court that they have continued to drive their cases toward resolution, both in matters of case administration and discussions with their major creditor constituencies. James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, points to these significant developments since April 23, 2009, when the first exclusivity extension order was entered: (a) On March 26, 2009, the Court entered an order establishing a general claims bar date of June 12, 2009. As of July 24, 2009, more than 6,000 claims asserting approximately $606 billion in the aggregate have been filed. Based on the Debtors' preliminary analysis, the filed claims that are likely to be allowed may not vary substantially from their scheduled aggregate liabilities of approximately $13.7 billion. (b) The Debtors are party to approximately 45,000 executory contracts and unexpired leases. The Debtors have obtained Court approval to assume executory contracts to support their operations, and their review and analysis continues. The Debtors were granted an extension through July 6, 2009, to assume or reject their remaining unexpired real estate leases. Through March 23, 2009, the Debtors were granted orders pursuant to three omnibus motions to reject more than 70 leases for an annual cost savings of approximately $6,100,000. On June 25, 2009, the Debtors were authorized to assume 224 unexpired non-residential leases and pay cure amounts up to approximately $377,000 and, after resolving objections, the Debtors were granted their fourth omnibus rejection order regarding 30 additional leases for annual cost savings of approximately $9,900,000, before offset for any replacement space. (c) The Debtors have continued to pursue a potential transaction involving the Chicago Cubs, a Major League Baseball franchise that is owned and operated by one of Tribune's non-Debtor affiliates, Chicago National League Ball Club, LLC and Cubs LLC's subsidiaries and related interests. If successfully concluded, that transaction will allow the majority of the value of the Chicago Cubs -- one of the most valuable single assets of Tribune and its affiliates -- to be monetized, generating substantial cash proceeds, and having a material impact on the structure of any Plan. (d) The Debtors have conducted extensive operational, financial and legal analyses necessary to the formulation of a confirmable Plan. The Debtors have had extensive discussions with both the Official Committee of Unsecured Creditors and their senior lender steering committee concerning the framework for a consensual Plan and believe that progress have been made. The Debtors have worked continuously over the last several months to provide the Committee with requested information in order to allow it to complete its due diligence of the Debtors and their principal prepetition transactions. (e) The Debtors strive to maintain a cooperative and responsive relationship with their creditor constituencies, including the Creditors' Committee and the Steering Committee. The Debtors and their professionals have provided to the Creditors' Committee and the Steering Committee massive amounts of data and analyses involving sizing the Debtors' current and potential liabilities, including pension liabilities, tax liabilities and intercompany claims. The Debtors attempt to inform and obtain feedback from the Creditors' Committee and the Steering Committee on all matters of significance in their cases, through their legal and financial advisors, maintain regular communications, including frequent meetings and telephone conferences. Mr. Conlan maintains that the Debtors have devoted substantial time and resources to the development of a long-term business plan necessary for the formulation of a Plan. "If this Court were to deny the Debtors' request for a further extension of the Exclusive Periods, any party in interest would be free to propose a plan of reorganization for each of the 111 Debtors," Mr. Conlan says. He adds that terminating exclusivity at this critical juncture would not advance the rehabilitative objectives of the Chapter 11 process. Judge Carey will convene a hearing on the request on August 11, 2009. 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 Debtors' Action Removal Period is automatically extended until the conclusion of that hearing. Objections are due August 4. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Alvarez & Marsal Bills $3MM for March-May Work ---------------------------------------------------------- Pursuant to Sections 330 and 331 of the Bankruptcy Code, these professionals hired in Tribune Co. and its affiliates' bankruptcy cases filed interim fee applications: A. Debtors' Professionals Professional Period Fees Expenses ------------ ------ ---- -------- Alvarez & Marsal North 03/01/09- America, LLC 05/31/09 $3,064,212 $26,710 Alvarez & Marsal North 05/01/09- America, LLC 05/31/09 701,658 6,207 Sidley Austin LLP 05/01/09- 05/31/09 1,201,675 44,700 Jenner & Block LLP 05/01/09- 05/31/09 93,036 5,705 Jenner & Block LLP 03/01/09- 05/31/09 448,140 11,721 Mercer (US) Inc. 03/01/09- 05/31/09 266,908 10,532 Mercer (US) Inc. 01/12/09- 02/28/09 116,170 139 Mercer (US) Inc. 04/01/09- 04/30/09 106,803 7,031 Mercer (US) Inc. 03/01/09- 03/31/09 102,335 288 Mercer (US) Inc. 02/01/09- 02/28/09 83,855 0 Mercer (US) Inc. 05/01/09- 05/31/09 57,769 3,212 Mercer (US) Inc. 01/12/09- 01/31/09 32,315 139 Cole, Schotz, Meisel, 03/01/09- Forman & Leonard, P.A. 05/31/09 256,560 17,090 Cole, Schotz, Meisel, 05/01/09- Forman & Leonard, P.A. 05/31/09 77,805 3,025 Paul, Hastings, 05/01/09- Janofsky & Walker LLP 05/31/09 204,721 883 Lazard Freres & Co. LLC 04/01/09- 04/30/09 200,000 7,119 PricewaterhouseCoopers 04/01/09- LLP 04/30/09 144,183 53 Paul, Hastings, 04/01/09- Janofsky & Walker LLP 04/30/09 122,648 88 PricewaterhouseCoopers 05/01/09- LLP 05/31/09 118,617 310 Stuart Maue 05/01/09- 05/31/09 69,957 - Stuart Maue 03/01/09- 04/30/09 62,237 - Jones Day 03/01/09- 05/31/09 41,280 91 Jones Day 04/01/09- 05/31/09 34,217 74 Reed Smith LLP 03/01/09- 05/31/09 24,944 1,254 Reed Smith LLP 05/01/09- 05/31/09 5,710 283 Jones Day 12/08/08- 02/28/09 23,822 442 Daniel J. Edelman 03/09/09- 05/31/09 7,068 125 Daniel J. Edelman Inc. 05/01/09- 05/31/09 875 0 Sidley Austin, Paul Hastings, Cole Schotz, Reed Smith, Jones Day, and Jenner & Block are counsel to the Debtors for separate matters. PwC serves as the Debtors' tax advisors and independent auditors. Alvarez & Marsal is the Debtors' restructuring advisor. Lazard Freres is the Debtors' investment banker and financial advisor. Daniel J. Edelman is the Debtors' corporate communications and investor relations consultant. Stuart Maue serves as the Debtors' fee examiner. Mercer is the Debtors' compensation consultant. The Debtors said they received no objections as to these professionals' monthly fee applications: Professional Period ------------ ------ PricewaterhouseCoopers LLP 03/01/09-03/31/09 Sidley Austin LLP 04/01/09-04/30/09 Cole, Schotz, Meisel, Forman & Leonard, P.A. 04/01/09-04/30/09 Jenner Block LLP 04/01/09-04/30/09 Daniel J. Edelman, Inc. 04/01/09-04/30/09 Reed Smith LLP 04/01/09-04/30/09 Alvarez & Marsal North America, LLC 04/01/09-04/30/09 Jones Day 12/08/09-03/31/09 B. Official Committee of Unsecured Creditors' Professionals Professional Period Fees Expenses ------------ ------ ---- -------- Chadbourne & Parke LLP 03/01/09- 05/31/09 $1,761,577 $51,679 Chadbourne & Parke LLP 05/01/09- 05/31/09 582,143 31,011 AlixPartners, LLP 03/01/09- 05/31/09 1,582,226 24,608 AlixPartners, LLP 05/01/09- 05/31/09 533,933 8,547 Moelis & Company LLC 05/01/09- 05/31/09 200,000 1,874 Landis Rath & Cobb LLP 03/01/09- 05/31/09 151,213 9,480 Landis Rath & Cobb 05/01/09- LLP 05/31/09 46,008 2,305 AlixPartners is the Committee's financial advisor. Landis Rath and Chadbourne & Parke are the Committee's co-counsel. Moelis & Company serves as the Committee's investment banker. The Creditors' Committee said it received no objections to the fee applications submitted by Moelis & Company LLC for the period from April 1, 2009 to April 30, 2009. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Expands Scope of PwC Work as Tax Advisors ----------------------------------------------------- William T. England, a partner of PricewaterhouseCoopers LLP, discloses that Tribune Co. and its affiliates have expanded the scope of PwC's services associated with the 2008 consolidator audit services and have agreed to additional estimated fees to complete the 2008 financial statement audits. The Debtors and PwC also expanded the scope of services for PwC to perform the integrated audit of the consolidated financial statements of the Debtors at December 27, 2009, and for the year then ending of the Debtors' internal control over financial reporting as of December 27, 2009. As reported by the Troubled Company Reporter on March 19, 2009, Judge Kevin Carey of the U.S. Bankruptcy Court for the District of Delaware has authorized Tribune Company and its debtor-affiliates to employ PricewaterhouseCoopers LLP as compensation and tax advisors and independent auditors nunc pro tunc to the Petition Date. The Debtors entered into an engagement agreement with PwC, which agreement outlines the firm's responsibilities and compensation. PwC acted as the Debtors' outside advisors and independent auditor for many years, gaining considerable experience with their current corporate, financial and internal structures. Under the terms of the original engagement, PwC agreed to five categories of services as tax advisors: (1) General Compensation Advisory Services, including: -- advising on the design of annual and long-term incentive programs; -- preparing cost estimates for implementing any arrangements; -- advising on participant target levels for the incentive programs; and -- advising on severance and retention programs; (b) Integrated Auditing Services at December 28, 2008 and for the year then ending; (c) a review on Tribune Company's unaudited consolidated quarterly financial information; (d) General Tax Consulting Services, including: -- advising on tax issues resulting from the Debtors' Chapter 11 cases; -- advising on tax planning or reporting matters; and -- preparing or reviewing original and amended returns for all taxes including federal, state and local income taxes, gross receipts, license, sales and use taxes and property taxes; (e) Claims Response and Settlement Services including: -- assisting in managing, responding to and verifying the accuracy of claims submitted for federal income taxes, state and local net income taxes, franchise, sales use, property and business license or gross receipts taxes as a result of the Debtors' Chapter 11 cases; -- assist in negotiating settlements with taxing authorities with respect to claims submitted due to the Debtors' Chapter 11 cases, as well as tax assessments for which the Debtors requests assistance during the pendency of their cases; and (f) additional compensation, tax and accounting consulting, as requested by the Debtors. The Engagement Letter provides that: (a) PwC will not be entitled to indemnification, contribution, or reimbursement for services other than the services provided in the Engagement Letter, unless the services and the indemnification, contribution, or reimbursement is approved by the Court; (b) the Debtors will have no obligation to indemnify any person or provide contribution or reimbursement for any claim or expense to the extent that it is (i) judicially determined to have arisen from gross negligence or willful misconduct; (ii) for a contractual dispute in which the Debtors allege that breach of PricewaterhouseCoopers' contractual obligations unless the Court determines that indemnification, contribution, or reimbursement would be permissible; and (c) if before the confirmation of Chapter 11 plan or the closing of the Chapter 11 cases, PricewaterhouseCooper believes it is entitled to the payment by the Debtors on account of indemnification, contribution, or reimbursement obligations, the Debtors may not pay any amount without the Court's order. The Debtors propose to pay PricewaterhouseCoopers based on the firm's hourly rates: Partner $625-$760 Managing Director $600-$625 Director $450-$500 Manager $280-$320 Senior Associate $200-$240 Associate $155-$180 Professional Assistant $145 The Debtors relate that the estimated fees in connection with the PwC's auditing services are approximately $1,815,000, not including out-of-pocket expenses. Prior to the Petition Date, the Debtors provided PwC with a retainer of $50,000 for services rendered and reimbursement of expenses. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Nielsen Media Withdraws $3.4-mil. Claims ---------------------------------------------------- In separate Court filings, Nielsen Media Research, Inc., n/k/a The Nielsen Company (US), LLC, notifies the Court of its intent to withdraw its claims against the Debtors totaling $3,473,054. Claim No. Debtor Claim Amount --------- ------ ------------ 5599 Tribune Broadcasting $2,605,101 5598 WGN Continental 725,241 5600 Tribune Entertainment 138,236 5601 Chicagoland Television News 4,476 About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRUMP ENTERTAINMENT: To Be Bought for $100MM by Donald Trump, BNAC ------------------------------------------------------------------ MarketWatch's By V. Phani Kumar says Trump Entertainment Resorts said late Monday that Donald Trump and BNAC, an affiliate of Beal Bank Nevada, will invest $100 million cash to buy the reorganized company. The report says Beal Bank and Beal Bank Nevada will separately restructure about $486 million of the Debtors' debt. The plan has to be approved by a bankruptcy court. About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the Company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC, and other affiliates filed for Chapter 11 on February 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of December 31, 2008. TVI CORP: U.S. Trustee Refuses to Appoint Equity Committee ---------------------------------------------------------- The U.S. Trustee for Region 4 denied a request from certain holders of TVI Corporation and its debtor-affiliates' common stock to appoint an official shareholders committee to serve in the Chapter 11 cases. A full-text copy of the letter from the U.S. Trustee is available for free at http://ResearchArchives.com/t/s?4096 The Debtors entered into an amendment to their debtor-in- possession credit agreement with Branch Banking and Trust. The amendment extends the milestones to be achieved by the Debtors. The amendment stated that the Debtors would: a) deliver to the Lender a draft disclosure statement and plan of reorganization on or before July 31, 2009; and b) file a disclosure statement and a plan of reorganization with the Bankruptcy Court, which disclosure statement and plan will be acceptable to the Lender in all respects in its sole and absolute discretion, on or before Aug. 14, 2009. About TVI Corporation Headquartered in Glenn Dale, Maryland, TVI Corporation -- http://www.tvicorp.com/-- supplies military and civilian emergency first responder and first receiver products, personal protection products and quick-erect shelter systems. The products include powered air-purifying respirators, respiratory filters and quick-erect shelter systems used for decontamination, hospital surge systems and command and control. The users of these products include military and homeland defense/homeland security customers. The Company and two of its affiliates filed for Chapter 11 protection on April 1, 2009 (Bankr. D. Md. Lead Case No. 09-15677). Christopher William Mahoney, Esq., Jeffrey W. Spear, Esq., and Joel M. Walker, Esq., at Duane Morris LLP, represent the Debtors in their restructuring efforts. Debtors tapped Buccino & Associates, Inc., as their financial advisors and consultants. When the Debtor filed for protection from its creditors, it listed $10 million to $50 million in assets and $1 million to $10 million in debts. TXCO RESOURCES: Nasdaq Disqualifies and Delists Common Stock ------------------------------------------------------------ The Nasdaq Stock Market, LLC, removed from the listing the common stock of TXCO Resources Inc. on July 13, 2009. Based on a review of the information provided by the Company, Nasdaq Staff determined that the Company no longer qualified for listing on the Exchange pursuant to Listing Rules 5100, 5110(b) and IM-5100-1. The Company was notified of the Staffs determination on May 18, 2009. The Company did not appeal the Staff determination to the Hearings Panel, and the Staff determination to delist the Company became final on May 28, 2009. The Company and its affiliates filed for Chapter 11 protection on May 17, 2009 (Bankr. W.D. Tex. Case No. 09-51807). The Debtors hired Deborah D. Williamson, Esq., and Lindsey D. Graham, Esq., at Cox Smith Matthews Incorporated, as general restructuring counsel; Fulbright and Jaworski, L.L.P., as corporate counsel & conflicts counsel; Albert S. Conly as chief restructuring officer and FTI Consulting Inc. as financial advisor; Goldman, Sachs & Co. as financial advisor for assets sale; Global Hunter Securities, LLC, as financial advisors and investment bankers; and Administar Services Group LLC as claims agent. Gardere Wynne Sewell LLP represents the Committee. As reported in Troubled Company Reporter on July 6, 2009, in their schedules of assets and liabilities, the Debtors have $357,855,952 in total assets and $331,422,792 in total liabilities. VALMONT INDUSTRIES: S&P Raises Corporate Credit Rating From 'BB+' ----------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit and issue-level rating on Valmont Industries Inc. by one notch. S&P raised the corporate credit rating to 'BBB-' from 'BB+'. The rating outlook is stable. "The ratings upgrade reflects S&P's view that Valmont's operating performance will remain good, despite the ongoing significant slowdown in domestic construction spending," said Standard & Poor's credit analyst Thomas Nadramia. The company's healthy operating performance is attributable to a combination of its presence in relatively less recession-resistant end markets, particularly those tied to highway spending and utilities and communications infrastructure, and its diversification into international markets. As a result, S&P expects the company will be in a position to maintain credit metrics at levels more consistent with a low-investment-grade rating. Omaha, Nebraska-based Valmont is a leading producer of metal products, such as lighting and traffic poles, utility poles for electricity transmission, communication towers, agricultural irrigation equipment, and other tubular products. The stable outlook incorporates S&P's expectation that Valmont will maintain credit metrics around current levels, despite likely continued weakness in commercial construction and irrigation end markets. Furthermore, based upon Valmont's prudent financial risk policies, variable cost structure and historically modest leverage, S&P anticipates that Valmont will maintain credit measures in line with the ratings even if end markets and operating earnings perform considerably worse than expected. Specifically, S&P expects adjusted debt to EBITDA to remain below 2x and FFO to debt to remain above 40% even if end markets weaken. Given current weakness in several of the company's segments, S&P believes a revision in the outlook to positive is unlikely in the near term unless operating earnings materially exceed expectations or the company achieves greater size and geographic diversity while maintaining margins. S&P could change the outlook to negative if operating earnings fall rapidly from current levels due to volume declines following unexpected cuts in infrastructure spending for highways or electrical distribution. Specifically, this would require deterioration in operating margins to less than 10% and sustained debt to EBITDA of greater than 2.5x. VISTEON CORP: Nissan Trading Wants Payment of $630,000 Claim ------------------------------------------------------------ In separate filings, two of Visteon Corp.'s creditors ask the Court to direct the Debtors to pay them their administrative claims pursuant to Section 503(b)(9) of the Bankruptcy Code: Creditor Admin. Claim -------- ------------ Nissan Trading Corp., USA $630,167 Unique Fabricating, Inc. 16,706 Flow Dry Technology, Inc., has withdrawn its motion for payment of a $6,714 administrative claim. No reason was stated for the withdrawal. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Panasonic Withdraws Adequate Assurance Request ------------------------------------------------------------ Panasonic Automotive Systems Company of America withdrew its motion for adequate assurance of payment from Visteon Corp. and its affiliates. No reason was stated for the withdrawal. Panasonic Automotive, and certain of the Debtors are parties to multiple purchase orders, scheduling orders, and other contracts, pursuant to which Panasonic supplies audio or visual equipment and components to the Debtors. The Debtors incorporate Panasonic's products into their own components that they in turn supplies to vehicle manufacturers. In mid-2008, Panasonic became concerned with the Debtors' deteriorating financial condition based on the Debtors' balance sheet, public filings, press reports, and other industry- recognized statistical models. Panasonic came to the conclusion that there was a material risk that the Debtors would be unable to continue to perform under the terms of the Prepetition Contract. By a June 30, 2008 letter, Panasonic informed the Debtors that it had reasonable grounds of insecurity regarding the Debtors' ability to perform and thus, demanded that the Debtors provide it with adequate assurance of payment in the form of cash-in-advance payment terms or in the alternative, an irrevocable stand-by letter of credit in its favor in exchange for its continuing provision of trade credit to the Debtors. The Debtors ultimately provided Panasonic with appropriate adequate assurance, the terms of which are subject to a confidentiality agreement. Panasonic relates that as of the Petition Date, the Debtors owe it owed $2,543,920, of which $179,335 is past due. Panasonic tells the Court the Debtors have threatened to seek damages for alleged breach of contract and automatic stay violations unless Panasonic renders performance under a prepetition contract providing for the delivery of goods -- historically $600,000 per week -- on trade credit terms of approximately 55 days. In its request, Panasonic had asked the Court to compel the Debtors to: (i) provide adequate assurance in the form of either cash-in- advance in the amount of goods ordered under the purchase orders or in the alternative, a letter of credit in an amount reasonably acceptable to Panasonic, as a precondition to Panasonic's shipment of goods; or (ii) decide on whether to assume or reject the Prepetition Contract. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Retirees Oppose Termination of Benefit Plans ---------------------------------------------------------- A number of retirees filed with the Bankruptcy Court letters, opposing the Debtors' proposed termination of post-employment health care benefits. On July 29, 2009, a petition was filed by 34 retirees of the Debtors opposing the termination of the Post-Employment health Benefits. In a separate report, USAToday.com notes that more than 1,400 retired employees of Visteon Corporation signed petitions, protesting Visteon's plan to terminate retiree health and life insurance. According to the report, petitions were mailed to the U.S. Bankruptcy Court for the District of Delaware. Debtors Visteon Corporation, Visteon Systems LLC, and Visteon Caribbean Inc. currently maintain employee benefit plans and programs that provide "other post-employment benefits" to certain retirees and their spouses, surviving spouses, domestic partners and dependents. The Debtor may also provide OPEB in the future to certain active employees who are currently or may become eligible for OPEB, certain former employees who are currently or may become eligible for OPEB, and their spouses, surviving spouses, domestic partners and dependents, in their retirement. The Debtors aver that the cost of providing the OPEB is one of the largest and most significant long-term liabilities on their balance sheet. These benefits, the Debtors note, are funded on a pay-as-you-go basis. The Sponsoring Debtors provide OPEB to approximately 6,650 retirees, including former salaried employees and former hourly employees under the Visteon Corporation Health and Welfare Program for Salaried Employees, the Visteon Systems LLC Health and Welfare Benefit Plan for Hourly Employees, the Connersville and Bedford Plan, the Visteon Systems LLC Health and Welfare Benefit Plan for Hourly Employees (North Penn Location), and the Visteon Caribbean Inc. Employee Group Insurance Plan. Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, relates after full and careful deliberation, the Sponsoring Debtors have determined that they must eliminate their current and future costs associated with providing OPEB in order to successfully restructure their businesses. Ms. Jones tells the Court that the Sponsoring Debtors' OPEB liability is projected to be $310,000,000 by end of 2009, with projected cash costs of $31,000,000 in this year alone. "These liabilities are not sustainable," Ms. Jones states. Accordingly, the Sponsoring Debtors are asking the Court for authority to modify or terminate their Plans and Programs that providing these post-employment benefits: (1) Employer-paid post-employment health care benefits for current active employees, their spouses, surviving spouses, domestic partners and dependents; (2) Employer-paid post-employment health care benefits for current and future retirees, their spouses, surviving spouses, domestic partners and dependents; (3) Retiree medical credits and related retiree medical notional accounts established by the Sponsoring Debtors; and (4) Employer-paid post-employment basic life insurance benefits for current retirees. Document Requests In a notice to the Court, the Debtors relate that they have submitted responses and objections to The International Union of Electronic, Electrical, Technical Salaried, Machine, and Furniture Workers-Communication Workers of America, AFL-CIO's document requests and deposition notices on July 20, 2009. IUE previously sought documents and depositions with respect to employee benefits provided by the Debtors. The Debtors also note that they also served their first set of document requests on IUE on July 22, 2009. Details on what the documents requests are all about were not made available in the Court dockets. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) ZILA INC: Misses Quarterly Interest Payment Due July 31 ------------------------------------------------------- ZILA Inc. did not make a quarterly interest payment due July 31, 2009, under its Senior Secured Convertible Notes. ZILA has already failed to make the quarterly interest payments due on January 31, 2009, and April 30, 2009, under the Notes. Each failure to make an interest payment constitutes an event of default under the Notes. ZILA said it has not received a notice of default or acceleration from Tolmar Holding Inc., the note holder, as of Friday, which is required prior to any of the principal amount becoming due and payable as a result of such defaults. On July 28, 2009, Tolmar, ZILA, and certain of ZILA's subsidiaries entered into a Forbearance Agreement. Tolmar agreed to forbear, for a certain period of time and subject to certain conditions, from exercising its rights under the Notes to accelerate the payment of all or part of the outstanding principal amount of the Notes and accrued and unpaid interest as a result of, among other things, (i) ZILA's past failure to make the interest payments due on January 31, 2009 and April 30, 2009 and (ii) ZILA's anticipated failure to make the interest payment due on July 31, 2009. Tolmar and ZILA agreed that: (i) the outstanding principal amount of the Notes is $12,000,001.20, and (ii) as of July 28, the accrued and unpaid interest with respect to the Notes is $1,104,666.84. Upon the occurrence and during the continuation of any event of default, all amounts outstanding under the Notes bear interest at a default rate of 15.0% per annum. Tolmar acquired the Notes from Visium Balanced Master Fund, Ltd. and Atlas Master Fund, Ltd. ZILA, TOLMAR and Project Z Acquisition Sub, Inc. on June 25, 2009, entered into an Agreement and Plan of Merger. Pursuant to the terms of the Merger, Acquisition Sub will merge with and into ZILA, with ZILA surviving as a wholly owned subsidiary of Tolmar. A full-text copy of the Forbearance Agreement, dated July 28, 2009, by and among ZILA, Inc., certain of its subsidiaries and TOLMAR Holding, Inc., is available at no charge at: http://ResearchArchives.com/t/s?409b About ZILA Inc. Based in Scottsdale, Arizona, ZILA Inc. is a diagnostic company dedicated to the prevention, detection and treatment of oral cancer and periodontal disease. ZILA manufactures and market ViziLite(R) Plus with TBlue(R), its flagship product for the early detection of oral abnormalities that could lead to cancer. * * * As reported by the Troubled Company Reporter on June 18, 2009, historically, the Company sustained recurring losses and negative cash flows from operations as it changed its strategic direction to focus on the growth and development of ViziLite(R) Plus and its periodontal product lines. The Company's liquidity needs have arisen from the funding of its research and development program and the launch of its new products, as ViziLite(R) Plus, working capital and debt service requirements, and strategic initiatives. The Company's balance sheet at April 30, 2009, showed total assets of $21,302,884, total liabilities of $16,932,897 and shareholders' equity of $4,369,987. The Company is in compliance with the terms of the senior secured convertible notes, except for the quarterly interest payments due April 30, 2009, and Jan. 31, 2009. The failures to make these payments are events of default under its senior secured convertible notes. Upon an event of default, the senior secured convertible notes bear interest at a default rate of 15.0% per annum. Although the Company has not received a notice of default or acceleration from the note holders as of the date of this filing, which is required prior to any of the principal amount becoming due and payable as a result of the default, the Company has reclassified the senior secured convertible notes to current liabilities. Pursuant to the Note Purchase Agreement, the holders of the Senior Secured Convertible Notes have agreed not to exercise their remedies under the notes unless and until the note purchase agreement is terminated. However, there can be no assurance that the current or future note holders will not accelerate amounts due under the senior secured convertible Notes and proceed against their collateral. In the event of acceleration, the Company indicated it would likely be forced to file for protection under Chapter 11 of the Federal Bankruptcy Code or liquidate the Company under Chapter 7 of the Federal Bankruptcy Code, which would likely result in its common stock becoming worthless. The Company anticipates it will need to refinance its senior secured convertible notes by their due date of July 31, 2010. As of April 30, 2009, there were $1.1 million of unamortized debt issue costs and $2.2 million of debt discounts relative to the senior secured convertible notes. ZILA INC: Tolmar Amends Merger Deal, Raises Per Share Offer ----------------------------------------------------------- ZILA, Inc., TOLMAR Holding, Inc., and Project Z Acquisition Sub, Inc., on June 25, 2009, entered into an Agreement and Plan of Merger. Pursuant to the terms of the Merger, Acquisition Sub will merge with and into ZILA, with ZILA surviving as a wholly owned subsidiary of Tolmar. On July 28, 2009, ZILA, Tolmar and Acquisition Sub entered into First Amendment to Agreement and Plan of Merger to modify certain terms of the Merger Agreement: -- The merger consideration was increased from $0.38 per share to $0.45 per share for holders of shares of ZILA common stock. -- The merger consideration was increased from $0.44 per share to $0.50 per share for holders of ZILA Series B Convertible Preferred Stock. -- Certain covenants and closing conditions were amended or deleted. -- ZILA updated its confidential disclosure schedules to reflect developments since the date of the Merger Agreement. ZILA has received notice from Tolmar that Tolmar has acquired from Visium Balanced Master Fund, Ltd. and Atlas Master Fund, Ltd. the Third Amended and Restated Senior Secured Convertible Notes, dated November 28, 2006, issued by ZILA, in the aggregate principal amount of $12,000,001.20. David Bethune, ZILA's chairman and CEO, said, "The ZILA Board of Directors has continued its efforts to secure the best possible outcome for our stockholders. In the coming days we expect to complete a proxy statement that will provide our stockholders with all the details of the proposed merger and how the voting process works." As part of the note purchase Tolmar acquired 435,084 shares of ZILA stock, representing roughly 4% of the outstanding common stock, from the note holders with a proxy to vote it in favor of the merger. ZILA intends to hold a special meeting of its stockholders as soon as practicable, and the parties anticipate that the proposed merger will close by September. Upon the completion of the proposed merger, ZILA will no longer be a publicly traded company. On July 2, 2009, ZILA filed with the Securities and Exchange Commission a preliminary proxy statement relating to the proposed merger with Tolmar. ZILA intends to file a definitive proxy statement and other relevant materials with the SEC in the near future. The materials will also be mailed to ZILA's stockholders. A full-text copy of the First Amendment to Agreement and Plan of Merger, dated July 28, 2009, by and among TOLMAR Holding, Inc., Project Z Acquisition Sub, Inc. and ZILA, Inc., is available at no charge at http://ResearchArchives.com/t/s?409a About ZILA Inc. Based in Scottsdale, Arizona, ZILA Inc. is a diagnostic company dedicated to the prevention, detection and treatment of oral cancer and periodontal disease. ZILA manufactures and market ViziLite(R) Plus with TBlue(R), its flagship product for the early detection of oral abnormalities that could lead to cancer. * * * As reported by the Troubled Company Reporter on June 18, 2009, historically, the Company sustained recurring losses and negative cash flows from operations as it changed its strategic direction to focus on the growth and development of ViziLite(R) Plus and its periodontal product lines. The Company's liquidity needs have arisen from the funding of its research and development program and the launch of its new products, as ViziLite(R) Plus, working capital and debt service requirements, and strategic initiatives. The Company's balance sheet at April 30, 2009, showed total assets of $21,302,884, total liabilities of $16,932,897 and shareholders' equity of $4,369,987. The Company is in compliance with the terms of the senior secured convertible notes, except for the quarterly interest payments due April 30, 2009, and January 31, 2009. The failures to make these payments are events of default under its senior secured convertible notes. Upon an event of default, the senior secured convertible notes bear interest at a default rate of 15.0% per annum. Although the Company has not received a notice of default or acceleration from the note holders as of the date of this filing, which is required prior to any of the principal amount becoming due and payable as a result of the default, the Company has reclassified the senior secured convertible notes to current liabilities. Pursuant to the Note Purchase Agreement, the holders of the Senior Secured Convertible Notes have agreed not to exercise their remedies under the notes unless and until the note purchase agreement is terminated. However, there can be no assurance that the current or future note holders will not accelerate amounts due under the senior secured convertible Notes and proceed against their collateral. In the event of acceleration, the Company indicated it would likely be forced to file for protection under Chapter 11 of the Federal Bankruptcy Code or liquidate the Company under Chapter 7 of the Federal Bankruptcy Code, which would likely result in its common stock becoming worthless. The Company anticipates it will need to refinance its senior secured convertible notes by their due date of July 31, 2010. As of April 30, 2009, there were $1.1 million of unamortized debt issue costs and $2.2 million of debt discounts relative to the senior secured convertible notes. * Less DIP Financings Available as Corporate Defaults Increase -------------------------------------------------------------- With corporate defaults at a six-year high, debtor-in-possession financings dropped to about 23% of businesses failing to make debt payments so far this year, the lowest since at least 2003, Bloomberg News reported, citing strategists at Bank of America Merrill Lynch. Lenders are charging those entering Chapter 11 reorganization a record 7.25 percentage points over benchmark interest rates, on average, even with borrowing costs for issuers of junk-rated bonds the cheapest since September, Carla Main at Bloomberg News said. Less available financing for DIP loans will give fewer companies the option of restructuring and exiting bankruptcy and drive more into liquidation, said Darin Schmalz, a director on the Fitch Ratings leveraged finance team in Chicago. The tightening of available credit is tied to the decline in the value of collateral used for DIP financing. * Credit-Card Defaults Rose in June on Unemployment, Fitch Says --------------------------------------------------------------- Recent indicators are providing a glimmer of hope that U.S. credit card ABS chargeoffs may soon plateau, according to Fitch Ratings in a July 31 release. While prime chargeoffs set another record high this month, the rate of increase has slowed significantly from earlier this year as delinquencies continued to stabilize over recent periods, according to the latest Fitch Prime Credit Card Index results covering the June collection period. The results, while partly driven by seasonal factors, point to chargeoffs leveling in the coming months. 'We typically observe a dip in chargeoffs during the third quarter following seasonal declines in delinquencies during the second quarter,' said Managing Director Michael Dean. 'The most encouraging trends at this stage are the deceleration in chargeoff increases combined with stabilization in delinquency rates.' Chargeoffs rose 35 basis points (bps) in the most recent period pushing Fitch's Prime Chargeoff Index to 10.79% and 64% higher than year-earlier measures. Despite the elevated chargeoff levels, Fitch expects current ratings of senior tranches to remain stable given available credit enhancement and structural protections afforded investors. The outlook for subordinate tranches, however, remains negative. After increasing rapidly for more than a year, credit card delinquencies have leveled off over the last five months, with this month's rate declining 14 bps to 4.31%. Year over year, however, delinquencies still are almost 40% higher. 'Delinquencies remain elevated and continue to hover near record high levels,' said Senior Director Cynthia Ullrich. 'We do not anticipate chargeoffs to recede meaningfully until we see some improvement in unemployment, delinquency and bankruptcy trends.' Pricing initiatives and discount options continue to generate incremental yield, as evidenced by a 36 bp rise in this month's yield to 17.95%, representing the highest level in 15 months. Since the increase in yield completely offset the increase in chargeoffs this month, one-month excess spread improved slightly although the three-month average excess spread remains compressed at 4.35%. Excess spread measures the profitability of credit transactions and is the amount left over after chargeoffs, bond coupon, and servicing expenses are subtracted from yield. * Scott Pinsonnault Joins Bridge Associates' Turnaround Practice ---------------------------------------------------------------- Energy/oil & gas expert Scott M. Pinsonnault will lead Bridge Associates LLC's growing Energy Turnaround and Restructuring Practice. "We are delighted to welcome Scott to the Energy practice team," stated Louis E. Robichaux IV, Managing Director and Co-Managing Member of Bridge Associates. "Mr. Pinsonnault's breadth of experience as both an operator and financier in the energy and oil & gas sectors will be a tremendous asset to the firm's growing energy restructuring practice." Mr. Pinsonnault joins Bridge as a Director in the Dallas office. Mr. Pinsonnault will be part of the senior management team focusing on Bridge's energy practice. Mr. Pinsonnault is a 15-year veteran of the oil & gas, energy and energy financial services industries. He began his oil & gas career as a geoscientist with Texaco in New Orleans, Louisiana. For the last nine years he advanced in a career of principal investing and lending to oil & gas and energy companies with two large publicly-traded investment companies. "Scott has aggregated an impressive set of oil & gas technical and operating skills as well as broad-based principal investing, lending, management and restructuring experience," said David N. Phelps, Managing Director and Co-Managing Member of Bridge Associates. Mr. Pinsonnault received a BS in Geology from St. Lawrence University, an MS in Geology and Geophysics from Texas A&M University and an MBA from Tulane University. He is a member of the American Bankruptcy Institute, the Turnaround Management Association, the Association of Insolvency & Restructuring Advisors, as well as numerous oil & gas industry and professional associations. Bridge Associates LLC -- http://www.bridgeassociatesllc.com/-- is a national turnaround, crisis management and financial advisory services firm. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------- ------- ABSOLUTE SOFTWRE ABT CN 107 (7) 24 ACCO BRANDS CORP ABD US 1,100 (107) 135 AFC ENTERPRISES AFCE US 131 (33) 2 AMR CORP AMR US 24,138 (3,000) (3,129) ARBITRON INC ARB US 220 0 (22) ARRAY BIOPHARMA ARRY US 108 (54) 31 ARVINMERITOR INC ARM US 2,873 (719) 278 AUTOZONE INC AZO US 5,296 (45) (527) AVATAR HOLDINGS AVTR US 585 0 N.A. BLOUNT INTL BLT US 499 (43) 175 BOARDWALK REAL E BEI-U CN 2,318 (5) N.A. BOARDWALK REAL E BOWFF US 2,318 (5) N.A. BP PRUD BAY-RTU BPT US 9 8 0 BRIGHAM EXPLOR BEXP US 365 2 17 BURCON NUTRASCIE BU CN 4 3 2 CABLEVISION SYS CVC US 9,551 (5,349) (367) CADIZ INC CDZI US 45 9 4 CARDTRONICS INC CATM US 468 (22) (33) CENTENNIAL COMM CYCL US 1,413 (992) 148 CENVEO INC CVO US 1,501 (221) 163 CHENIERE ENERGY CQP US 1,975 (408) 79 CHOICE HOTELS CHH US 357 (141) (22) CINCINNATI BELL CBB US 2,029 (638) (147) CLOROX CO CLX US 4,464 (309) (866) CONOCOPHILLIPS COP US N.A. 0 N.A. DELTEK INC PROJ US 191 (48) 42 DISH NETWORK-A DISH US 7,063 (1,666) (422) DOMINO'S PIZZA DPZ US 461 (1,372) 113 DUN & BRADSTREET DNB US 1,614 (785) (176) DYAX CORP DYAX US 64 (41) 9 EINSTEIN NOAH RE BAGL US 168 (11) (52) ENERGY COMPOSITE ENCC US 0 0 0 EPICEPT CORP EPCT SS 12 (5) 4 EXELIXIS INC EXEL US 333 (123) 29 EXTENDICARE REAL EXE-U CN 1,833 (51) 98 FEMALE HEALTH FHCO US 13 9 8 FORD MOTOR CO F US 207,270 (16,476) (40,953) FORD MOTOR CO F BB 207,270 (16,476) (40,953) FX ENERGY INC FXEN US 38 7 7 GARTNER INC IT US 948 4 (223) GENTEK INC GETI US 430 (8) 102 GLG PARTNERS INC GLG US 345 (382) 101 GLG PARTNERS-UTS GLG/U US 345 (382) 101 GOLD RESOURCE CO GORO US 9 9 7 HALOZYME THERAPE HALO US 68 3 52 HEALTHSOUTH CORP HLS US 1,921 (656) (53) HERMAN MILLER MLHR US 767 8 167 HOLLY ENERGY PAR HEP US 469 0 (6) HUMAN GENOME SCI HGSI US 670 (55) 117 IDENIX PHARM IDIX US 82 (4) 34 IMAX CORP IMX CN 226 (98) 19 IMAX CORP IMAX US 226 (98) 19 IMMUNOMEDICS INC IMMU US 59 0 7 IMS HEALTH INC RX US 2,026 4 328 INCYTE CORP INCY US 189 (256) 123 INTERMUNE INC ITMN US 193 (82) 121 IPCS INC IPCS US 545 (41) 62 ISTA PHARMACEUTI ISTA US 82 (17) 31 JAZZ PHARMACEUTI JAZZ US 179 (38) 3 JOHN BEAN TECH JBT US 559 (6) 78 JUST ENERGY INCO JE-U CN 535 (692) (358) KNOLOGY INC KNOL US 635 (52) 25 LINEAR TECH CORP LLTC US 1,421 (266) 963 LIONS GATE LGF US 1,667 (8) (819) LOGMEIN INC LOGM US 40 4 0 MAP PHARMACEUTIC MAPP US 78 4 32 MAXLIFE FUND COR MXFD US 0 0 0 MEAD JOHNSON-A MJN US 1,707 (897) 380 MEDIACOM COMM-A MCCC US 3,700 (463) (281) MEDIDATA SOLUTIO MDSO US 72 (13) (17) MEDIVATION INC MDVN US 211 0 128 MODAVOX INC MDVX US 5 3 (1) MOLECULAR INSIGH MIPI US 107 (62) 86 MOODY'S CORP MCO US 1,873 (749) (404) NATIONAL CINEMED NCMI US 604 (514) 89 NAVISTAR INTL NAV US 9,656 (1,447) 1,784 NPS PHARM INC NPSP US 200 (225) 87 OCH-ZIFF CAPIT-A OZM US 1,821 (177) N.A. OVERSTOCK.COM OSTK US 129 (3) 33 PALM INC PALM US 643 (108) 11 PDL BIOPHARMA IN PDLI US 217 (306) 140 PENN REIT PEI US 3,457 0 N.A. PERMIAN BASIN PBT US 10 0 9 PETROALGAE INC PALG US 5 (23) (7) POTLATCH CORP PCH US 916 0 N.A. QWEST COMMUNICAT Q US 20,226 (1,051) 260 REGAL ENTERTAI-A RGC US 2,563 (246) (78) RENAISSANCE LEA RLRN US 58 0 (6) REVLON INC-A REV US 797 (1,074) 87 SALLY BEAUTY HOL SBH US 1,433 (702) 389 SANDRIDGE ENERGY SD US 2,670 (114) 118 SCHOLASTIC CORP SCHL US 1,654 0 425 SEMGROUP ENERGY SGLP US 354 (126) 27 SIGA TECH INC SIGA US 7 (6) (3) SONIC CORP SONC US 828 (22) 75 STANDARD PARKING STAN US 231 0 (15) STEREOTAXIS INC STXS US 53 (4) 3 SUCCESSFACTORS I SFSF US 165 (5) 1 SUN COMMUNITIES SUI US 1,197 (68) N.A. SYNERGY PHARMACE SGYP US 0 (68) (1) TALBOTS INC TLB US 999 (1) (28) TAUBMAN CENTERS TCO US 2,858 (184) N.A. TENNECO INC TEN US 2,767 (289) 240 THERAVANCE THRX US 206 (263) 166 UAL CORP UAUA US 18,805 (159) (2,345) UNITED RENTALS URI US 3,918 (2,628) 316 US AIRWAYS GROUP LCC US 7,857 (46) (548) VECTOR GROUP LTD VGR US 683 (336) 44 VENOCO INC VQ US 730 5 33 VERIFONE HOLDING PAY IT 843 (107) 299 VERIFONE HOLDING PAY US 843 (14) 299 VERIFONE HOLDING VF2 GR 843 (14) 299 VIRGIN MOBILE-A VM US 323 (281) (141) WALTER INVESTMEN WAC US 12 (44) N.A. WARNER MUSIC GRO WMG US 4,256 (110) (394) WEIGHT WATCHERS WTW US 1,087 (848) (313) WESTERN ALLIANCE WAL US 5 0 N.A. WR GRACE & CO GRA US 3,815 (351) 977 ZYMOGENETICS INC ZGEN US 279 8 107 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Danilo Munnoz, Joseph Medel C. Martirez, Denise Marie Varquez, Philline Reluya, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2009. 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 **